What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-11-13 compared with 2024-08-14 · 673 added, 719 removed, 1026 unchanged (58% of the section changed)

1 unchanged sentence

Holdings, Inc.

Consolidated Balance Sheets

Consolidated Statements of Operations

Consolidated Statements of Changes in Stockholders’ Equity (Deficit)

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Balance Sheets

Statements of Operations

Statements of Changes in Stockholders’ Equity (Deficit)

Statements of Cash Flows

to Consolidated Financial Statements

Holdings, Inc.

1 unchanged sentence

Balance Sheets

June 30, 2024

December 31, 2023

receivable - net

from related party

Current Assets

Accounts receivable - net

Due from related party

Prepaids and other

Total Current Assets

Property and equipment - net

Operating lease - right-of-use asset

Operating lease - right-of-use asset - related party

Operating lease - right-of-use asset

Liabilities and Stockholders’ Deficit

and equipment - net

lease - right-of-use asset

lease - right-of-use asset - related party

lease - right-of-use asset

and Stockholders’ Equity (Deficit)

payable and accrued expenses

payable and accrued expenses - related parties

payable and accrued expenses

payable - net

payable - related parties - net

payable - net

lease liability

lease liability - related party

lease liability

payable (common stock) - related parties

Current Liabilities

Accounts payable and accrued expenses

Accounts payable and accrued expenses - related parties

Accounts payable and accrued expenses

Notes payable - net

Notes payable - related parties - net

Notes payable - net

Operating lease liability

Operating lease liability - related party

Operating lease liability

Total Current Liabilities

Term Liabilities

payable - net

lease liability

lease liability - related party

lease liability

Long Term Liabilities

Notes payable - net

Operating lease liability

Operating lease liability - related party

Operating lease liability

Total Long Term Liabilities

Total Liabilities

Commitments and Contingencies

Stockholders’ Deficit

Preferred stock - $ 0.0001 par value;

and Contingencies

Stockholders’

Equity (Deficit)

stock - $ 0.0001 par value;

5,000,000 shares authorized none issued and outstanding, respectively

Common stock - $ 0.0001 par value, 500,000,000 shares authorized 2,151,902 and 1,806,612 shares issued and outstanding, respectively

Common stock issuable ( 242,000 and 104,000 shares, respectively)

Additional paid-in capital

Accumulated deficit

( 50,577,405 )

Preferred stock - Series A, $ 0.0001 par value;

513,000 shares designated 363,000 and none issued and outstanding, respectively

Preferred stock - Series B, $ 0.0001 par value;

150,000 shares designated 140,000 and none issued and outstanding, respectively

stock - $ 0.0001 par value, 500,000,000 shares authorized 6,208,073 and 1,806,612 shares issued and outstanding, respectively

stock issuable ( 0 and 104,000 shares, respectively)

paid-in capital

( 58,741,247 )

Total Stockholders’ Deficit

( 45,317,050 )

Stockholders’ Equity (Deficit)

( 1,906,206 )

Total Liabilities and Stockholders’ Deficit

Liabilities and Stockholders’ Equity (Deficit)

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

1 unchanged sentence

and Subsidiary

Consolidated Statements

of Operations and Comprehensive Loss

the Three Months Ended June 30,

the Six Months Ended June 30,

Costs and expenses

Statements of Operations and Comprehensive Loss

the Three Months Ended September 30,

the Nine Months Ended September 30,

Cost of sales

General and administrative expenses

Depreciation and amortization

Total costs and expenses

Loss from operations

and administrative expenses

and amortization

costs and expenses

from operations

( 1,613,024 )

2 unchanged sentences

( 6,082,503 )

Other income (expense)

Interest income

Interest expense

income (expense)

expense (including amortization of debt discount)

( 5,601,813 )

( 8,163,375 )

on sale of marketable debt securities - net

Loss on debt extinguishment – related party

of fixed assets

other income (expense) - net

5 unchanged sentences

$ ( 7,044,320 )

per share - basic and diluted

Weighted average number

of shares - basic and diluted

Comprehensive loss:

$ ( 3,361,233 )

$ ( 2,468,811 )

$ ( 5,260,355 )

$ ( 4,817,582 )

Change in fair value

of debt securities

comprehensive loss:

stock dividend - payable on Series A convertible preferred stock - to be issued in common stock

stock dividend - payable on Series B convertible preferred stock - to be issued in common stock

stock dividend

loss available to common stockholders - basic and diluted

$ ( 8,160,343 )

2 unchanged sentences

$ ( 7,044,320 )

per share - basic and diluted

average number of shares - basic and diluted

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

1 unchanged sentence

and Subsidiary

Consolidated Statements

of Changes in Stockholders’ Deficit

For the Three and Six Months Ended June 30, 2024

Preferred Stock

Common Stock Issuable

Additional Paid-in

Total Stockholders’

December 31, 2023

Statements of Changes in Stockholders’ Deficit

the Three and Nine Months Ended September 30, 2024

A - Convertible

B - Convertible

Stockholders’

$ ( 45,317,050 ) -

$ ( 1,906,206 )

Stock based compensation - related parties

Stock issued as debt issue costs - related party

Stock issued for services

based compensation - related parties

issued as debt issue costs - related party

issued for services

( 1,899,122 ) -

( 1,899,122 )

March 31, 2024

( 47,216,172 ) -

( 3,312,101 )

Stock based compensation - related parties

Stock issued as debt issue costs - related party

Stock issued in connection with loan interest expense – related party

based compensation - related parties

issued as debt issue costs - related party

issued in connection with loan interest expense - related party

( 3,364,732 ) -

( 3,364,732 )

June 30, 2024

( 50,580,904 ) -

( 4,836,949 )

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

EzFill Holdings, Inc.

based compensation - related parties

issued for cash - related party

of debt - related party - preferred stock

of debt - related party - common stock

issued as debt issue costs - related party

issued for services

split true up adjustment

of previously issuable common stock - related party

Loss on debt extinguishment – related party

A and B - convertible preferred stock dividends - payable in common stock

( 8,075,509 ) -

( 8,075,509 )

$ ( 58,741,247 ) -

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

Holdings, Inc.

and Subsidiary

Consolidated Statements of Changes in Stockholders’

For the Three and Six Months Ended June 30, 2023

Preferred Stock

Additional Paid-in

Accumulated Other Comprehensive

Total Stockholders’

December 31, 2022

Statements of Changes in Stockholders’ Deficit

the Three and Nine Months Ended September 30, 2023

Comprehensive

Stockholders’

$ ( 34,845,161 )

Stock based compensation - related parties

Stock based compensation - other

Stock sold for cash (ATM) - net of offering costs

Cash paid for direct offering costs

Unrealized gain on debt securities

based compensation - related parties

based compensation - other

sold for cash (ATM) - net of offering costs

paid for direct offering costs

gain on debt securities

( 2,348,771 )

March 31, 2023

( 37,193,932 )

based compensation - related parties

based compensation - other

issued as debt issue costs - related party

issued as debt issue costs (contingent shares) - related party

gain on debt securities

( 2,468,811 )

Stock based compensation - related parties

Stock based compensation - other

Stock issued as debt issue costs - related party

Stock issued as debt issue costs (contingent shares) - related party

Unrealized gain on debt securities

( 2,468,811 )

( 39,662,743 )

June 30, 2023

( 39,662,743 )

based compensation - related parties

based compensation - other

issued as debt issue costs - related party

issued for services

( 2,226,738 )

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

( 2,226,738 )

$ ( 41,889,481 )

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

Holdings, Inc.

and Subsidiary

Consolidated Statements of Cash Flows

For the Six Months Ended June 30,

Operating activities

Statements of Cash Flows

the Nine Ended September 30,

$ ( 13,339,363 )

$ ( 7,044,320 )

Adjustments to reconcile net loss to net cash used in operations

Depreciation and amortization

Amortization of bond premium and realized loss on investments in debt securities

Amortization of operating lease - right-of-use asset

Amortization of operating lease - right-of-use asset - related party

Amortization of debt discount

Bad debt expense

Stock issued in connection with loan interest expense – related party

Stock issued for services

Stock issued for services - related parties

Changes in operating assets and liabilities

(Increase) decrease in

Accounts Receivable

Prepaids and other

Increase (decrease) in

Accounts payable and accrued expenses

Accounts payable and accrued expenses - related party

Operating lease liability

Operating lease liability - related party

Net cash used in operating activities

to reconcile net loss to net cash used in operations

and amortization

Impairment of fixed assets

of bond premium and realized loss on investments in debt securities

of operating lease - right-of-use asset

of operating lease - right-of-use asset - related party

of debt discount

issued in connection with loan interest expense - related party

issued for services

issued for services - related parties

penalty interest expense

Loss on debt extinguishment – related party

in operating assets and liabilities

(decrease) in

payable and accrued expenses

payable and accrued expenses - related party

lease liability

lease liability - related party

cash used in operating activities

( 3,448,667 )

( 5,439,667 )

Investing activities

Proceeds from sale of marketable debt securities

Advances - related party

Purchase of fixed assets - net of refunds on prior purchases

Net cash used provided by (used in) investing activities

Financing activities

Proceeds from notes payable

Proceeds from notes payable - related party

Proceeds from stock issued for cash

Cash paid for direct offering costs

Repayments on notes payable

Repayments on loan payable - related party

Net cash provided by financing activities

Net decrease in cash

Cash - beginning of period

Cash - end of period

Supplemental disclosure of cash flow information

Cash paid for interest

Cash paid for income tax

Supplemental disclosure of non-cash investing and financing activities

Debt discount (OID) in connection with the issuance of notes payable - related

Adjust note balance for actual borrowings

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

HOLDING, INC.

from sale of marketable debt securities

- related party

of fixed assets - net of refunds on prior purchases

cash used provided by (used in) investing activities

from issuance of Series B - convertible preferred stock - related party

from notes payable

from notes payable - related party

from common stock issued for cash

paid for direct offering costs - common stock

on line of credit

( 1,000,000 )

on notes payable

on loan payable - related party

cash provided by financing activities

decrease in cash

( 1,661,563 )

- beginning of period

- end of period

disclosure of cash flow information

paid for interest

paid for income tax

disclosure of non-cash investing and financing activities

of debt - related party - Series A, preferred stock

of debt - related party - common stock

of accrued interest - related party - common stock

discount (OID) in connection with the issuance of notes payable - related party

A and B - preferred stock dividends - payable in common stock

note balance for actual borrowings

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

HOLDINGS, INC.

AND SUBSIDIARY

2 unchanged sentences

and Nature of Operations

Holding, Inc.

Holdings, Inc.

and Subsidiary (“EzFill,” “EHI,” “we,” “our” or “the Company”),

2 unchanged sentences

Its wholly owned subsidiary Neighborhood Fuel Holdings, LLC is inactive.

– Continued Listing Rule or Standard

previously disclosed, on August 22, 2023, the Company received a letter from the Listing Qualifications Staff (the “Staff”)

of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that the Company’s stockholders’ equity did not comply with

the minimum $ 2,500,000 stockholders’ equity requirement for continued listing set forth in Listing Rule 5550(b) (the “Equity

Upon submission of the Company’s plan to regain compliance, the Staff granted the Company an extension until February

20, 2024 to comply with this requirement.

February 21, 2024, the Company received a delist determination letter (the “Delist Letter”) from the Staff advising the Company

that the Staff had determined that the Company did not meet the terms of the extension.

Specifically, the Company did not complete its

proposed transaction to regain compliance with the Equity Rule and evidence compliance on or before February 20, 2024.

See Form 8-K filed

on February 23, 2024.

Company had requested an appeal for the Staff’s determination.

A hearing occurred on May 2, 2024.

At the hearing, the Company presented

its plan for regaining compliance with the Equity Rule and may request a further extension to complete the execution of its plan.

August 30, 2024, the Company received a letter from Nasdaq confirming that the Company has (i) regained compliance with the Equity Rule,

as required by the Panel’s decision dated May 13, 2024, as amended, and (ii) in application of Listing Rule 5815(d)(4)(B), the

Company will be subject to a mandatory panel monitor for a period of one year from the date of such letter.

If, within that one-year

monitoring period, the Staff finds that the Company is no longer in compliance with the Equity Rule, then, notwithstanding Listing Rule

5810(c)(2), the Company will not be permitted to provide Staff with a plan of compliance with respect to such deficiency and Staff will

not be permitted to grant additional time for the Company to regain compliance with respect to such deficiency, nor will the Company

be afforded an applicable cure or compliance period pursuant to Listing Rule 5810(c)(3).

Instead, the Staff will issue a Delist Determination

Letter, and the Company will have an opportunity to request a new hearing with the initial Panel or a newly convened Hearings Panel if

the initial Panel is unavailable.

The Company will have the opportunity to respond/ present to the Hearings Panel as provided by Listing

Rule 5815(d)(4)(C) and the Company’s securities may at that time be delisted from Nasdaq.

of Presentation

6 unchanged sentences

the opinion of the Company’s management, the accompanying unaudited consolidated financial statements contain all of the adjustments

necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of June 30, 2024 and the

results of operations and cash flows for the periods presented.

The results of operations for the six months ended June 30, 2024 are

not necessarily indicative of the operating results for the full fiscal year or any future period.

necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of September 30, 2024 and

the results of operations and cash flows for the periods presented.

The results of operations for the nine months ended September 30,

2024 are not necessarily indicative of the operating results for the full fiscal year or any future period.

unaudited consolidated financial statements should be read in conjunction with the financial statements and related notes thereto included

4 unchanged sentences

and Going Concern

reflected in the accompanying consolidated financial statements, for the six months ended June 30, 2024, the Company had:

loss of $ 5,260,355 ;

Net cash used in operations was $ 2,095,470

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

reflected in the accompanying consolidated financial statements, for the nine months ended September 30, 2024, the Company had:

loss available to common stockholders of $ 13,424,197 ;

cash used in operations was $ 3,448,667

Additionally,

at June 30, 2024, the Company had:

Accumulated deficit of $ 50,577,405

Stockholders’ deficit of $ 4,833,450 ;

at September 30, 2024, the Company had:

deficit of $ 58,741,247

Stockholders’

equity of $ 3,558,365 ;

capital deficit of $ 1,302,925

5 unchanged sentences

the Company to complete its initiatives or attain profitable operations.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Company’s operating needs include the planned costs to operate its business, including amounts required to fund working capital

8 unchanged sentences

The Company had cash on hand

of $ 306,811 at June 30, 2024.

of $ 828,185 at September 30, 2024.

Company has historically incurred significant losses since inception and has not demonstrated an ability to generate sufficient revenues

3 unchanged sentences

our financial position, our cash flows and cash usage forecasts for the twelve months

ended June 30, 2025, and our current capital structure including equity-based instruments and our obligations and debts.

ended September 30, 2025, and our current capital structure including equity-based instruments and our obligations and debts.

factors create substantial doubt about the Company’s ability to continue as a going concern within the twelve-month period subsequent

3 unchanged sentences

and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

strategic plans include the following:

Expand into new and existing markets (commercial and residential),

into new and existing markets (commercial and residential);

additional debt and/or equity based financing;

Collaborations with other operating businesses for strategic

opportunities;

other businesses to enhance or complement our current business model while accelerating our

Collaborations

with other operating businesses for strategic opportunities;

other businesses to enhance or complement our current business model while accelerating our growth.

2 - Summary of Significant Accounting Policies

28 unchanged sentences

and liabilities made after the end of the measurement period are recorded within the Company’s earnings.

HOLDING, INC.

HOLDINGS, INC.

AND SUBSIDIARY

28 unchanged sentences

We do not have any property or equipment outside of the United States.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

of Estimates and Assumptions

7 unchanged sentences

assumptions, which include both quantitative and qualitative assessments that it believes to be reasonable under the circumstances.

estimates during the six months ended June 30, 2024 and 2023, respectively, include, allowance for doubtful accounts and other receivables,

inventory reserves and classifications, valuation of loss contingencies, valuation of stock-based compensation, estimated useful lives

related to property and equipment, impairment of intangible assets, implicit interest rate in right-of-use operating leases, uncertain

tax positions, and the valuation allowance on deferred tax assets.

estimates during the nine months ended September 30, 2024 and 2023, respectively, include, allowance for doubtful accounts and other

receivables, inventory reserves and classifications, valuation of loss contingencies, valuation of stock-based compensation, estimated

useful lives related to property and equipment, impairment of intangible assets, implicit interest rate in right-of-use operating leases,

uncertain tax positions, and the valuation allowance on deferred tax assets.

and Uncertainties

9 unchanged sentences

results on a consistent basis.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Value of Financial Instruments

8 unchanged sentences

The hierarchy requires the Company to use observable inputs when available, and to minimize the use of unobservable inputs, when determining

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

three tiers are defined as follows:

14 unchanged sentences

of market participants, market factors, or the weighting of various valuation methods.

The Company may also engage external advisors

to assist us in determining fair value, as appropriate.

Although the Company believes that the recorded fair value of our financial instruments

is appropriate, these fair values may not be indicative of net realizable value or reflective of future fair values.

Company may also engage external advisors to assist us in determining fair value, as appropriate.

Although the Company believes that

the recorded fair value of our financial instruments is appropriate, these fair values may not be indicative of net realizable value

or reflective of future fair values.

Company’s financial instruments, including cash, accounts receivable, accounts payable and accrued expenses, and accounts payable

and accrued expenses – related party, are carried at historical cost.

At June 30, 2024 and December 31, 2023, respectively, the

carrying amounts of these instruments approximated their fair values because of the short-term nature of these instruments.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

At September 30, 2024 and December 31, 2023, respectively,

the carrying amounts of these instruments approximated their fair values because of the short-term nature of these instruments.

825-10 “Financial Instruments” allows entities to voluntarily choose to measure certain financial assets and liabilities

9 unchanged sentences

or less at the purchase date and money market accounts to be cash equivalents.

June 30, 2024 and December 31, 2023, respectively, the Company did not have any cash equivalents.

September 30, 2024 and December 31, 2023, respectively, the Company did not have any cash equivalents.

Company is exposed to credit risk on its cash and cash equivalents in the event of default by the financial institutions to the extent

account balances exceed the amount insured by the FDIC, which is $ 250,000 .

June 30, 2024 and December 31, 2023, respectively, the Company did not experience any losses on cash balances in excess of FDIC insured

September 30, 2024 and December 31, 2023, respectively, the Company did not experience any losses on cash balances in excess of FDIC

insured limits.

Available-for-sale

11 unchanged sentences

then becomes the new amortized cost basis of the investment, and it is not adjusted for subsequent recoveries in fair value.

HOLDING, INC.

the nine months ended September 30, 2024 and 2023, the Company received proceeds of $ 0 and $ 2,130,116 , respectively, in connection with

the sale and liquidation of its investment portfolio.

losses, including amortization of bond premiums on these debt securities were $ 0 and $ 34,556 for the nine months ended September 30,

2024 and 2023, respectively.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

the six months ended June 30, 2024 and 2023, the Company received proceeds of $ 0 and $ 2,130,116 , respectively, in connection with the

sale and liquidation of its investment portfolio.

losses, including amortization of bond premiums on these debt securities were $ 0 and $ 34,556 for the six months ended June 30, 2024 and

2023, respectively.

receivable are stated at the amount management expects to collect from outstanding customer balances.

8 unchanged sentences

determination is made.

following is a summary of the Company’s accounts receivable at June 30, 2024 and December 31, 2023:

following is a summary of the Company’s accounts receivable at September 30, 2024 and December 31, 2023:

Schedule of Accounts Receivable

June 30, 2024

December 31, 2023

Accounts receivable

allowance for doubtful accounts

Accounts receivable - net

was bad debt expense of $ 0 and $ 79,357 for the three months ended June 30, 2024 and 2023, respectively.

was bad debt expense of $ 0 and $ 82,478 for the six months ended June 30, 2024 and 2023, respectively.

receivable - net

was bad debt expense of $ 7,799 and $ 1,086 for the three months ended September 30, 2024 and 2023, respectively.

was bad debt expense of $ 41,836 and $ 83,564 for the nine months ended September 30, 2024 and 2023, respectively.

debt expense (recovery) is recorded as a component of general and administrative expenses in the accompanying consolidated statements

of operations.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

consists solely of fuel.

2 unchanged sentences

Management assesses the recoverability of its inventory and establishes reserves on a quarterly basis.

were no provisions for inventory obsolescence for the three and six months ended June 30, 2024 and 2023, respectively.

June 30, 2024 and December 31, 2023, the Company had inventory of $ 103,490 and $ 134,057 , respectively.

were no provisions for inventory obsolescence for the three and nine months ended September 30, 2024 and 2023, respectively.

September 30, 2024 and December 31, 2023, the Company had inventory of $ 102,685 and $ 134,057 , respectively.

Concentrations

1 unchanged sentence

Schedule of Concentration of Risk

Six Months Ended June 30,

Year Ended December 31, 2023

Six Months Ended June 30,

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Months Ended September 30,

Ended December 31, 2023

Months Ended September 30,

of Long-lived Assets including Internal Use Capitalized Software Costs

2 unchanged sentences

Assets.” Events and circumstances considered by the Company in determining whether the carrying value of identifiable intangible

assets and other long-lived assets may not be recoverable include but are not limited to significant changes in performance relative

to expected operating results;

assets and other long-lived assets may not be recoverable, but are not limited to significant changes in performance relative to expected

operating results;

significant changes in the use of the assets;

significant negative industry or economic trends;

in the Company’s business strategy.

In determining if impairment exists, the Company estimates the undiscounted cash flows to be

generated from the use and ultimate disposition of these assets.

and changes in the

Company’s business strategy.

In determining if impairment exists, the Company estimates the undiscounted cash flows to be generated

from the use and ultimate disposition of these assets.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

impairment is indicated based on a comparison of the assets’ carrying values and the undiscounted cash flows, the impairment to

be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets.

were no impairment losses for the three and six months ended June 30, 2024 and 2023, respectively.

were no impairment losses for the three and nine months ended September 30, 2024 and 2023, respectively.

note 3 for discussion of impairments of long lived assets.

8 unchanged sentences

of the asset may not be recoverable.

were no impairment losses for the three and six months ended June 30, 2024 and 2023, respectively.

note 3 for discussion of impairments of long lived assets.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Company analyzes all financial instruments with features of both liabilities and equity under FASB ASC Topic No.

14 unchanged sentences

at the fair value of the instrument on the reclassification date.

June 30, 2024 and December 31, 2023, respectively, the Company had no derivative liabilities.

September 30, 2024 and December 31, 2023, respectively, the Company had no derivative liabilities.

Issue Discounts and Other Debt Discounts

9 unchanged sentences

The combined debt discounts cannot exceed the face amount of the debt issued.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

issuance cost paid to lenders, or third parties are recorded as debt discounts and amortized to interest expense over the life of the

18 unchanged sentences

renewal options are included in the measurement of the right-of-use assets and operating lease liabilities.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

the rate implicit in leases are not readily determinable, the Company uses an incremental borrowing rate to calculate the lease liability

9 unchanged sentences

incentives, discounts, rebates, and amounts collected on behalf of third parties.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

performance obligation is a promise in a contract to transfer a distinct good or service to a customer and is the unit of account under

29 unchanged sentences

it is probable that a significant future reversal of cumulative revenue under the contract will not occur.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

of the Company’s contracts contain a significant financing component.

None of the Company’s

contracts contain a significant financing component.

the transaction price to performance obligations in the contract

13 unchanged sentences

account available information such as market conditions and internally approved pricing guidelines related to the performance obligations.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Company’s contracts have a distinct single performance obligation and there are no contracts with variable consideration.

10 unchanged sentences

the Company recognizes fuel sales each month after delivery has occurred.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Liabilities (Deferred Revenue)

3 unchanged sentences

deposit is relieved and revenue is recognized.

June 30, 2024 and December 31, 2023, the Company had deferred revenue of $ 0 ,

respectively.

following represents the Company’s disaggregation of revenues for the six months ended June 30, 2024 and 2023:

September 30, 2024 and December 31, 2023, the Company had deferred revenue of $ 0 , respectively.

following represents the Company’s disaggregation of revenues for the nine months ended September 30, 2024 and 2023:

Schedule of Disaggregation of Revenue

Six Months Ended June 30,

% of Revenues

Months Ended September 30,

of sales primarily include fuel costs and wages/benefits paid to our drivers.

9 unchanged sentences

will be sustained upon examination by the tax authorities.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024 and December 31, 2023, respectively, the Company had no uncertain tax positions that qualify for either recognition or

disclosure in the financial statements.

September 30, 2024 and December 31, 2023, respectively, the Company had no uncertain tax positions that qualify for either recognition

or disclosure in the financial statements.

Company recognizes interest and penalties related to uncertain income tax positions in other expense.

No interest and penalties related

to uncertain income tax positions were recorded for the six months ended June 30, 2024 and 2023, respectively.

to uncertain income tax positions were recorded for the nine months ended September 30, 2024 and 2023, respectively.

of Deferred Tax Assets

8 unchanged sentences

is considered, along with all other available positive and negative evidence.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

categories of evidence carry more weight in the analysis than others based upon the extent to which the evidence may be objectively verified.

15 unchanged sentences

The Company also considers all other available positive and negative evidence in its analysis.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024 and December 31, 2023, respectively, the Company has recorded a full valuation allowance against its deferred tax assets

resulting in a net carrying amount of $ 0 .

September 30, 2024 and December 31, 2023, respectively, the Company has recorded a full valuation allowance against its deferred tax

assets resulting in a net carrying amount of $ 0 .

costs are expensed as incurred.

1 unchanged sentence

statements of operations.

Company recognized $ 33,661 and $ 21,737 in marketing and advertising costs during the three months ended June 30, 2024 and 2023, respectively.

Company recognized $ 58,167 and $ 80,377 in marketing and advertising costs during the six months ended June 30, 2024 and 2023, respectively.

Company recognized $ 54,099 and $ 29,724 in marketing and advertising costs during the three months ended September 30, 2024 and 2023,

respectively.

Company recognized $ 112,266 and $ 110,102 in marketing and advertising costs during the nine months ended September 30, 2024 and 2023,

respectively.

Company accounts for our stock-based compensation under ASC 718 “Compensation – Stock Compensation” using the

12 unchanged sentences

determining fair value of stock options, the Company considers the following assumptions in the Black-Scholes model:

Exercise price,

Expected dividends,

Expected volatility,

Risk-free interest rate;

Expected life of option

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

interest rate;

life of option

connection with certain financing (debt or equity), consulting and collaboration arrangements, the Company may issue warrants to purchase

10 unchanged sentences

or at the date of issuance if there is not a service period.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

and Diluted Earnings (Loss) per Share and Reverse Stock Split

14 unchanged sentences

shares of common stock are excluded from the denominator in computing net loss per share.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

stock and RSUs granted as part of share-based compensation contain nonforfeitable rights to dividends and dividend equivalents, respectively,

3 unchanged sentences

to dividend equivalents are forfeitable.

following potentially dilutive equity securities outstanding as of June 30, 2024 and 2023 were as follows:

following potentially dilutive equity securities outstanding as of September 30, 2024 and 2023 were as follows:

Schedule of Dilutive Equity Securities Outstanding

June 30, 2024

June 30, 2023

Stock options (vested)

Warrants (vested)

Total common stock equivalents

and stock options included as commons stock equivalents represent those that are fully vested and exercisable.

on the potential common stock equivalents noted above at June 30, 2024, the Company has sufficient authorized shares of common stock

A, preferred stock

B, preferred stock

Series A, preferred stock - dividends

Series B, preferred stock - dividends

common stock equivalents

A and B, preferred shares as well as the related dividends on each class are convertible into common stock.

included as common stock equivalents represent those that are fully vested and exercisable.

on the potential common stock equivalents noted above at September 30, 2024, the Company has sufficient authorized shares of common stock

( 500,000,000 ) to settle any potential exercises of common stock equivalents.

12 unchanged sentences

of the transacting parties might be prevented from fully pursuing its own separate interests.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Note 4 which includes accrued interest payable – related parties.

Notes 5 and 10 for a discussion of related party debt.

Note 7 regarding right-of-use operating lease with the Company’s Chief Technology Officer.

Notes 7 and 10 regarding right-of-use operating lease with the Company’s Chief Technology Officer.

Note 8 for a discussion of equity transactions with certain officers and directors.

Note 9 regarding expected share exchange agreement with NextNRG Holding Corp.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Party Agreement with Company owned by Daniel Arbour

1 unchanged sentence

revenue officer.

The Company will pay $ 5,000 per month and cover other certain expenses.

The Company will pay $ 5,000 per month and cover certain other expenses.

The initial term of the agreement is for one

8 unchanged sentences

connection with this agreement, the Company issued 130,000 shares of common stock.

At June 30, 2024 and December 31, 2023, 104,000 and

104,000 shares have vested, respectively.

At September 30, 2024 and December 31, 2023, 104,000

and 104,000 shares have vested, respectively.

The remaining 26,000 shares will vest in April 2025 ( 13,000 shares) and April 2026 ( 13,000

1 unchanged sentence

From Related Party

the six months ended June 30, 2024, the Company advanced $ 17,150 to an entity controlled by Michael Farkas (a material debt lender),

and an approximate 27 % stockholder in the Company.

the nine months ended September 30, 2024, the Company advanced $ 17,150 to an entity controlled by Michael Farkas (a former material debt

lender), and greater than 20 % stockholder in the Company.

The advance related to fees incurred by that entity for professional services.

7 unchanged sentences

yet effective accounting pronouncements, when adopted, will have a material impact on the consolidated financial statements of the Company.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

March 2022, the Financial Accounting Standards Board (the “FASB”) issued ASU 2022-02, Financial Instruments – Credit

34 unchanged sentences

effect on the consolidated results of operations, stockholders’ equity, or cash flows.

HOLDING, INC.

HOLDINGS, INC.

AND SUBSIDIARY

3 unchanged sentences

Schedule of Property and Equipment

Estimated Useful

June 30, 2024

December 31, 2023

Lives (Years)

Office furniture

Leasehold improvements

Office equipment

and equipment, gross

Accumulated depreciation

( 3,037,317 )

( 2,242,866 )

Total property and equipment - net

Months Ended June, 2024

and amortization expense for the three months ended June 30, 2024 and 2023 was $ 264,368 and $ 277,608 , respectively.

and amortization expense for the six months ended June 30, 2024 and 2023 was $ 540,891 and $ 550,695 , respectively.

amounts are included as a component of general and administrative expenses in the accompanying consolidated statements of operations.

property and equipment - net

Months Ended September 30, 2024

and amortization expense for the three months ended September 30, 2024 and 2023 was $ 269,561 and $ 278,442 , respectively.

and amortization expense for the nine months ended September 30, 2024 and 2023 was $ 810,451 and $ 829,137 , respectively.

the three and nine months ended September 30, 2024, the Company recorded an impairment loss of $ 13,422 related to leasehold improvements

made to certain leased office space that is no longer used.

and amortization are included as a component of general and administrative expenses in the accompanying consolidated statements of operations.

losses of property and equipment are included as a component of general and administrative expenses in the accompanying consolidated

statements of operations.

ended December 31, 2023

2 unchanged sentences

to true up the amounts to their actual balances.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

4 – Accounts Payable and Accrued Liabilities

payable and accrued liabilities were as follows at June 30, 2024 and December 31, respectively:

payable and accrued liabilities were as follows at September 30, 2024 and December 31, respectively:

Schedule of Accounts Payable and Accrued Liabilities

June 30, 2024

December 31, 2023

Accounts payable

Accrued interest payable - related parties

Accounts payable and accrued liabilities

interest payable - related parties

payable and accrued liabilities

following represents a summary of the Company’s debt (notes payable – related parties, third party debt for notes payable

(including those owed on vehicles), and line of credit, including key terms, and outstanding balances at June 30, 2024 and December 31,

(including those owed on vehicles), and line of credit, including key terms, and outstanding balances at September 30, 2024 and December

31, 2023, respectively.

Payable – Related Parties

following is a summary of the Company’s notes payable – related parties at June 30, 2024 and December 31, 2023:

following is a summary of the Company’s notes payable – related parties at September 30, 2024 and December 31, 2023:

of Notes Payable

1 unchanged sentence

Face amount of note

Debt discount/issue costs

discount/issue costs

( 1,608,900 )

Amortization of debt discount/issue costs

of debt discount/issue costs

Balance - December

Debt discount/issue costs - original issue discount

Debt discount/issue costs - stock issuances

discount/issue costs - original issue discount

discount/issue costs - stock issuances

( 2,020,387 )

Amortization of debt discount/issue costs

Balance - June 30, 2024

HOLDING, INC.

of debt discount/issue costs

penalty interest expense

of debt - preferred stock

( 3,630,000 )

of debt - common stock

( 9,322,500 )

- September 30, 2024

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

following is a detail of the Company’s notes payable – related parties at June 30, 2024 and December 31, 2023:

following is a detail of the Company’s notes payable – related parties at September 30, 2024 and December 31, 2023:

of Detailed Company’s Notes Payable

Notes Payable - Related Parties

Maturity Date

Shares Issued with Debt

Payable - Related Parties

Issued with Debt

Interest Rate

Default Interest Rate

June 30, 2024

December 31, 2023

April 19, 2023

July 17, 2024

September 22, 2023

July 17, 2024

October 13, 2023

July 17, 2024

August 31, 2024

August 2, 2023

August 31, 2024

August 23, 2023

August 31, 2024

August 30, 2023

August 31, 2024

September 6, 2023

August 31, 2024

September 13, 2023

August 31, 2024

November 3, 2023

August 31, 2024

November 21, 2023

August 31, 2024

December 4, 2023

August 31, 2024

December 13, 2023

August 31, 2024

December 18, 2023

August 31, 2024

December 20, 2023

August 31, 2024

December 27, 2023

August 31, 2024

January 5, 2024

August 31, 2024

January 16, 2024

August 31, 2024

January 25, 2024

August 31, 2024

February 7, 2024

August 31, 2024

February 20, 2024

August 31, 2024

February 28, 2024

August 31, 2024

March 8, 2024

August 31, 2024

March 15, 2024

August 31, 2024

March 26, 2024

August 31, 2024

April 2, 2024

August 31, 2024

April 8, 2024

August 31, 2024

April 22, 2024

August 31, 2024

June 10, 2024

August 31, 2024

June 28, 2024

August 31, 2024

Conversion Rate

unamortized debt discount

See discussion below regarding global amendment for Notes #1,

HOLDING, INC.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

discussion below regarding the limitation on the issuance of this lender due to a 9.99 % equity

ownership blocker.

discussion below regarding global amendment for Notes #1, #2 and #3.

discussion below regarding the limitation on the issuance of this lender due to a 9.99 % equity ownership blocker.

shares of common stock ( 425,978 ) were issued with the underlying original issue discount

1 unchanged sentence

Ended December 31, 2023

#1 – Note Payable – Related Party - Material Stockholder greater than 5% and related Loss on Debt Extinguishment

#1 – Note Payable – Related Party - Material Stockholder greater than 5% and

related Loss on Debt Extinguishment

2023, the Company originally executed a six-month (6) note payable with a face amount of $ 1,500,000 , less an original issue discount

19 unchanged sentences

than 10% different from the present value of the remaining cash flows under the original debt instrument.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

the year ended December 31, 2023, the Company recorded a loss on debt extinguishment of $ 291,000 as follows:

Schedule of Loss on Debt Extinguishment

Fair value of debt and common stock on extinguishment date *

Fair value of debt subject to modification

Loss on debt extinguishment - related party

value of debt and common stock on extinguishment date *

value of debt subject to modification

on debt extinguishment - related party

* The Company valued the

issuance of the 60,000 commitment

shares at $ 291,000 ,

based upon the quoted closing trading price on the date of modification ($ 4.85 /share).

issuance of the 60,000 commitment shares at $ 291,000 , based upon the quoted closing trading price on the date of modification

($ 4.85 /share).

to the January 17, 2024 global amendment, effective for all previously issued notes with this lender, in the event of default, the lender

11 unchanged sentences

all of the notes with this lender will be considered in default.

June 30, 2024, the Company is not in default on this note and believes it is in compliance with all terms and conditions of the note.

See May 9, 2024 loan date extension below.

May 9, 2024 loan date extension below.

lender is considered a related party since it has a greater than 5 % controlling interest in the Company’s outstanding common stock.

discussion regarding debt conversion below on August 16, 2024.

#2 – Note Payable – Related Party - Material Stockholder greater than 5%

4 unchanged sentences

based upon the quoted closing trading price ($ 6.78 /share).

HOLDING, INC.

HOLDINGS, INC.

AND SUBSIDIARY

18 unchanged sentences

all of the notes with this lender will be considered in default.

June 30, 2024, the Company is not in default on this note and believes it is in compliance with all terms and conditions of the note.

See May 9, 2024 loan date extension below.

May 9, 2024 loan date extension below.

lender is considered a related party since it has a greater than 5 % controlling interest in the Company’s outstanding common stock.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

discussion regarding debt conversion below on August 16, 2024.

#3 – Note Payable – Related Party - Material Stockholder greater than 5%

25 unchanged sentences

all of the notes with this lender will be considered in default.

June 30, 2024, the Company is not in default on this note and believes it is in compliance with all terms and conditions of the note.

See May 9, 2024 loan date extension below.

May 9, 2024 loan date extension below.

lender is considered a related party since it has a greater than 5 % controlling interest in the Company’s outstanding common stock.

HOLDING, INC.

HOLDINGS, INC.

AND SUBSIDIARY

5 unchanged sentences

Company determined the fair value of these shares was $ 270,000 ($ 3.75 /share), based upon the quoted closing trading price, and recorded

additional interest expense during the six months ended June 30, 2024.

June 30, 2024 and December 31, 2023, the Company reflected 330,000 and 104,000 shares, respectively as common stock issuable.

additional interest expense during the nine months ended September 30, 2024.

discussion regarding debt conversion below on August 16, 2024.

of Notes #1, #2 and #3

4 unchanged sentences

Company determined the fair value of these shares was $ 407,550 ($ 6.18 /share), based upon the quoted closing trading price, and recorded

additional interest expense during the six months ended June 30, 2024.

additional interest expense during the nine months ended September 30, 2024.

Conversion to Series A Preferred Stock

August 16, 2024, the Company converted all outstanding principal ($ 2,420,000 ) and accrued interest ($ 0 ) into 363,000 share of Series

A, Preferred Stock, $ 10 /share stated value.

At the time of conversion, the lender executed a 150 % penalty interest feature.

the Company increased its interest expense and related debt by $ 1,210,000 for a total of $ 3,630,000 of debt that was converted.

result of the debt conversion, the balance due to this lender was $ 0 .

fair value of the Series A, preferred stock and related loss on debt extinguishment at the conversion date was based on the

as-converted basis, calculated as follows:

Of Debt Extinguishment

Market price per share of common stock - on date of issuance

Discount to market price on date of issuance

Conversion price per share

Series A, preferred stock - stated value per share

Conversion price per share

Number of shares of common stock - for each share of Series A, preferred stock held

Series A, preferred shares issued

Number of shares of common stock - for each share of Series A, preferred stock held

Equivalent common shares

Market price per share of common stock - on date of issuance

As converted valuation of Series A, preferred stock

Debt converted in exchange for Series A, preferred stock

Loss on debt extinguishment - related party

Note 8 regarding features of this class of securities.

Stock Issuable – Notes #1, #2 and #3

connection with the conversion of these notes on August 16, 2024, 242,000 shares of common stock previously issuable were issued.

net effect on stockholders equity was $ 0 .

#4 - #39 - Notes Payable – Related Party - Material Stockholder greater than 20%

Payable – Related Party

Months Ended June 30, 2024

Months Ended September 30, 2024

Company executed several two-month (2) notes payable with an aggregate face amount of $ 3,630,000 , less original issue discounts of $ 330,000 ,

2 unchanged sentences

of $ 2,020,387 , based upon the quoted closing trading price ($ 2.81 - $ 7.10 /share).

total, the Company recorded debt discounts/issuance costs totaling $ 1,659,227 , which is being amortized over the life of these notes

to interest expense.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

total, the Company recorded debt discounts/issuance costs totaling $ 2,350,387 , which amortized over the life of these notes to interest

notes are initially due two-months (2) from their issuance dates.

12 unchanged sentences

for recording derivative liabilities.

June 30, 2024, the Company is not in default on any of these notes and believes it is in compliance with all terms and conditions of

lender is considered a related party as it is controlled by Michael Farkas, an approximate 27 % stockholder in the Company.

lender is considered a related party as it is controlled by Michael Farkas, who is a greater than 20 % stockholder in the Company.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Conversion to Common Stock

August 16, 2024, the Company converted all outstanding principal ($ 6,215,000 ) and accrued interest ($ 316,130 ) into 3,525,341 shares of

common stock.

At the time of conversion, the lender executed a 150 % penalty interest feature.

As a result, the Company increased its

interest expense and related debt by $ 3,265,565 for a total of $ 9,796,696 of debt that was converted.

As a result of the debt conversion,

the balance due to this lender was $ 0 .

The fair value of the common stock at the conversion date was $ 2.76 /share.

Accordingly, there

was no gain or loss on debt extinguishment.

Note 8 regarding features of this class of securities.

Additionally,

in connection with this debt conversion, all remaining unamortized debt discount was recorded as interest expense.

Ended December 31, 2023

10 unchanged sentences

outstanding principal and accrued interest are immediately due.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

in an event of default, the lender has the right to convert any or all of the outstanding principal and accrued interest into common

5 unchanged sentences

of the notes.

lender is considered a related party as it is controlled by Michael Farkas, an approximate 20 % stockholder in the Company.

lender is considered a related party as it is controlled by Michael Farkas, who is a greater than 20 % stockholder in the Company.

Payable - Other

Ended December 31, 2023

2023, an entity controlled by this majority stockholder (approximately 20 % common stock ownership) advanced unsecured working capital

funds (net proceeds after original issue discount of $ 12,500 was $ 250,000 ) to the Company.

In 2023, the note principal of $ 262,500 along

with accrued interest of $ 13,125 , aggregating $ 275,625 was repaid.

2023, an entity controlled by this majority stockholder (approximately 20 % common stock ownership at that time) advanced unsecured working

capital funds (net proceeds after original issue discount of $ 12,500 was $ 250,000 ) to the Company.

In 2023, the note principal of $ 262,500

along with accrued interest of $ 13,125 , aggregating $ 275,625 was repaid.

Payable (non-vehicles)

following is a summary of the Company’s note payable (non-vehicles) at June 30, 2024 and December 31, 2023, respectively:

following is a summary of the Company’s note payable (non-vehicles) at September 30, 2024 and December 31, 2023, respectively:

of Notes Payable

Balance - December

Face amount of note

Debt discount

Amortization of debt discount

amount of note

of debt discount

Balance - December

Face amount of note

Debt discount

Amortization of debt discount

Balance - June 30, 2024

amount of note

of debt discount

- September 30, 2024

April 2023, the Company executed a note payable with a face amount of $ 275,250 .

5 unchanged sentences

The Company received net proceeds of $ 250,000 .

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

April 2024, the Company executed a note payable with a face amount of $ 277,500 .

4 unchanged sentences

note to interest expense.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

note represented the refinancing of the initial note from April 2023.

3 unchanged sentences

the date of refinancing, all previous outstanding unamortized debt discount associated with the initial advance (loan #1) will be expensed.

following is a detail of the Company’s note payable (non-vehicles) at June 30, 2024 and December 31, 2023, respectively:

following is a detail of the Company’s note payable (non-vehicles) at September 30, 2024 and December 31, 2023, respectively:

of Detailed Company’s Notes Payable

Maturity Date

June 30, 2024

December 31, 2023

April 16, 2023

December 12, 2024

April 24, 2024

October 21, 2025

unamortized debt discount

Payable - Vehicles

following is a summary of the Company’s notes payable for its vehicles at June 30, 2024 and December 31, 2023, respectively:

following is a summary of the Company’s notes payable for its vehicles at September 30, 2024 and December 31, 2023, respectively:

of Notes Payable

Balance - December 31, 2022

- December 31, 2022

Balance - December

Balance - June 30, 2024

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

following is a detail of the Company’s notes payable for its vehicles at June 30, 2024 and December 31, 2023, respectively:

- September 30, 2024

following is a detail of the Company’s notes payable for its vehicles at September 30, 2024 and December 31, 2023, respectively:

of Detailed Company’s Notes Payable

Notes Payable - Vehicles

Maturity Date

Payable - Vehicles

Interest Rate

Default Interest Rate

June 30, 2024

December 31, 2023

January 15, 2021

November 15, 2025

April 9, 2019

February 17, 2024

December 15, 2021

December 18, 2024

December 16, 2021

December 18, 2024

January 11, 2022

January 25, 2025

January 11, 2022

January 25, 2025

January 11, 2022

January 25, 2025

January 11, 2022

January 25, 2025

February 8, 2022

February 10, 2025

February 8, 2022

February 10, 2025

February 8, 2022

February 10, 2025

February 8, 2022

February 10, 2025

April 5, 2022

April 20, 2025

April 5, 2022

April 20, 2025

April 5, 2022

April 20, 2025

April 5, 2022

April 20, 2025

April 5, 2022

April 20, 2025

April 5, 2022

April 20, 2025

April 5, 2022

April 20, 2025

April 5, 2022

April 20, 2025

August 4, 2022

August 18, 2025

August 4, 2022

August 18, 2025

November 1, 2021

November 11, 2025

November 1, 2021

November 11, 2025

November 1, 2021

November 11, 2025

April 27, 2022

current portion

Long term portion

HOLDING, INC.

HOLDINGS, INC.

AND SUBSIDIARY

3 unchanged sentences

of Maturities of Long Term Debt

For the Year Ended December 31,

Notes Payable - Related Parties

the Year Ended December 31,

Notes Payable

2024 (6 Months)

Ended December 31, 2023

11 unchanged sentences

This determination requires significant judgments to be made.

Company did not have any assets or liabilities measured at fair value on a recurring basis at June 30, 2024 and December 31, 2023, respectively.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Company did not have any assets or liabilities measured at fair value on a recurring basis at September 30, 2024 and December 31, 2023,

respectively.

7 – Commitments and Contingencies

36 unchanged sentences

in determining the present value of lease payments.

HOLDING, INC.

HOLDINGS, INC.

AND SUBSIDIARY

9 unchanged sentences

Differences between the calculated lease payment and actual payment are expensed as incurred.

June 30, 2024 and December 31, 2023, respectively, the Company had no financing leases as defined in ASC 842, “Leases.”

September 30, 2024 and December 31, 2023, respectively, the Company had no financing leases as defined in ASC 842, “Leases.”

December 3, 2021, the Company signed a lease for 5,778 square feet of office space, for occupancy effective January 1, 2022.

2 unchanged sentences

An initial Right of Use (“ROU”) asset of $ 735,197 was recognized as a non-cash asset addition.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

tables below present information regarding the Company’s operating lease assets and liabilities at June 30, 2024 and December 31,

tables below present information regarding the Company’s operating lease assets and liabilities at September 30, 2024 and December

31, 2023, respectively:

of Operating Lease Assets and Liabilities

June 30, 2024

December 31, 2023

Operating lease - right-of-use asset - non-current

Operating lease liability

Weighted-average remaining lease term (years)

Weighted-average discount rate

The components of lease expense were as follows:

lease - right-of-use asset - non-current

lease liability

Weighted-average

remaining lease term (years)

Weighted-average

discount rate

components of lease expense were as follows:

of Components of Lease Expense

June 30, 2024

June 30, 2023

of right-of-use operating lease asset

liability expense in connection with obligation repayment

operating lease costs

Amortization of right-of-use operating lease asset

Lease liability expense in connection with obligation repayment

Total operating lease costs

Supplemental cash flow information related to operating leases was as follows:

Operating cash outflows from operating lease (obligation payment)

Right-of-use asset obtained in exchange for new operating lease liability

HOLDING, INC.

cash flow information related to operating leases was as follows:

cash outflows from operating lease (obligation payment)

asset obtained in exchange for new operating lease liability

HOLDINGS, INC.

AND SUBSIDIARY

2 unchanged sentences

of Future Minimum Payments Under Non-Cancellable Leases

2024 (6 Months)

Total undiscounted cash flows

undiscounted cash flows

amount representing interest

Present value of operating lease liability

value of operating lease liability

current portion of operating lease liability

Long-term operating lease liability

Lease – Related Party

operating lease liability

Leases – Related Party

August 1, 2023, the Company signed a lease for 1,200 square feet of office space owned by the Company’s Chief Technology Officer.

3 unchanged sentences

asset addition.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

tables below present information regarding the Company’s operating lease assets and liabilities at June 30, 2024 and December 31,

tables below present information regarding the Company’s operating lease assets and liabilities at September 30, 2024 and December

31, 2023, respectively:

of Operating Lease Assets and Liabilities

June 30, 2024

December 31, 2023

Operating lease - right-of-use asset - non-current

Operating lease liability

Weighted-average remaining lease term (years)

Weighted-average discount rate

The components of lease expense were as follows:

lease - right-of-use asset - non-current

lease liability

Weighted-average

remaining lease term (years)

Weighted-average

discount rate

components of lease expense were as follows:

of Components of Lease Expense

June 30, 2024

June 30, 2023

of right-of-use operating lease asset

liability expense in connection with obligation repayment

operating lease costs

Amortization of right-of-use operating lease asset

Lease liability expense in connection with obligation repayment

Total operating lease costs

Supplemental cash flow information related to operating leases was as follows:

Operating cash outflows from operating lease (obligation payment)

Right-of-use asset obtained in exchange for new operating lease liability

HOLDING, INC.

cash flow information related to operating leases was as follows:

cash outflows from operating lease (obligation payment)

asset obtained in exchange for new operating lease liability

HOLDINGS, INC.

AND SUBSIDIARY

2 unchanged sentences

of Future Minimum Payments Under Non-Cancellable Leases

2024 (6 Months)

Total undiscounted cash flows

undiscounted cash flows

amount representing interest

Present value of operating lease liability

value of operating lease liability

current portion of operating lease liability

Long-term operating lease liability

operating lease liability

See Note 10 for termination of lease and execution

of new lease.

Ended December 31, 2023

13 unchanged sentences

year ended December 31, 2023.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Technology Officer

3 unchanged sentences

Additionally, the

remaining 26,000 shares vest 13,000 in April 2025 and 2026, respectively.

A corresponding expense totaling $ 52,000 was recorded for those

shares ( 26,000 ) which were part of this employment agreement that had not yet vested.

Total expense recorded during the year ended December

31, 2023 for the CTO was $ 717,600 .

remaining 26,000 shares vest 13,000 each in April 2025 and 2026, respectively.

A corresponding expense totaling $ 52,000 was recorded

for those shares ( 26,000 ) which were part of this employment agreement that had not yet vested.

Total expense recorded during the year

ended December 31, 2023 for the CTO was $ 717,600 .

expense was recorded as a component of general and administrative expenses for the year ended December 31, 2023.

Company has filed several Form 8K’s during July and August 2023 related to the hiring and termination of various officers, directors

Company has filed several Form 8-Ks during July and August 2023 related to the hiring and termination of various officers, directors

and board members.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Directors (New Board Members)

1 unchanged sentence

grant date based upon the quoted closing trading price ($ 4.95 - $ 5.53 /share).

All shares will vest in June 2024 coinciding with the Company’s

All shares vested in June 2024 coinciding with the Company’s

annual meeting.

Company recognized an expense of $ 238,334 related to the vesting of these shares over the term in which services are being provided.

Company recognized an expense of $ 238,334 related to the vesting of these shares over the term in which services were provided.

Directors (Former Board Members)

1 unchanged sentence

(through June 2023 prior to termination, these awards had been fully vested).

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Months Ended June 30, 2024

Months Ended September 30, 2024

connection with the employment agreements noted above, the Company recorded stock based compensation of $ 268,667 .

6 unchanged sentences

for potential insurance or third-party recoveries.

of June 30, 2024 and December 31, 2023, respectively, the Company is not aware of any litigation, pending litigation, or other transactions

that would require accrual or disclosure.

8 – Stockholders’ Deficit

June 30, 2024 and December 31, 2023, respectively, the Company had two (2) classes of stock:

shares authorized

of September 30, 2024 and December 31, 2023, respectively, the Company is not aware of any litigation, pending litigation, or other transactions

that require accrual or disclosure.

8 – Stockholders’ Equity (Deficit)

in Authorized Shares

June 14, 2024, the Company’s Board of Directors authorized an increase to its common stock from 50,000,000 shares to 500,000,000

September 30, 2024 the Company had four (4) classes of stock:

shares authorized (see Series A and B shares of preferred stock which have been designated

issued and outstanding

4 unchanged sentences

of redemption - none

Stock and Common Stock Issuable

Preferred Stock – Series A

and no shares designated at September 30, 2024 and December 31, 2023, respectively

and no shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively.

value - $ 0.0001

value of $ 10 /share

- Conversion – stated value of $ 10 /share, divided by 80% of the minimum price at the issuance date, which is $2.21/share, to be converted into common stock, for the issuance

of these 363,000 shares, this amount is a fixed conversion amount of 4.53 shares of common stock for each share of Series A, preferred

stock held, there are no other provisions that could result in a variable number of shares required for settlement.

Equivalent shares

at September 30, 2024 are 1,644,022.

(see Note 5 for calculation).

– 10% per year (2.5% per quarter), will be accrued based on the stated value per share of $10/share, on a quarterly

These dividends are due in the form of common stock.

The amount of dividend shares are calculated by taking the shares issued,

multiplied by the stated value per share, that amount is then multiplied by the dividend percentage.

The result was then multiplied by

80% of the quoted closing price at the date of issuance, which is $2.21/share.

This amount is a fixed conversion price, there are no other

provisions that could result in a variable number of shares required for settlement in the future

– equivalent to the number of shares common stock into which this series is convertible

- Liquidation

preference – none

of redemption – none

- Derivative liability – the Company

has considered relevant accounting guidance, and has determined that there are no provisions of this class of stock that would require

derivative liability treatment

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Preferred Stock – Series B

and no shares designated at September 30, 2024 and December 31, 2023, respectively

and no shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively

value - $ 0.0001

value of $ 10 /share

Conversion – stated value of $10/share, divided by 70%

of the minimum price at the issuance date, which is $1.93/share, to be converted into common stock, for the issuance

of these 140,000 shares, this amount is a fixed conversion amount of 5.18 shares of common stock for each share of Series B, preferred

stock held, there are no other provisions that could result in a variable number of shares required for settlement.

Equivalent shares

at September 30, 2024 are 724,638.

per year (3% per quarter), will be accrued based on the stated value per share of $10/share, on a quarterly basis.

These dividends

are due in the form of common stock.

The amount of dividend shares are calculated by taking the shares issued, multiplied by the

stated value per share, that amount is then multiplied by the dividend percentage.

The result was then multiplied by 70% of the

quoted closing price at the date of issuance, which is $1.93/share.

This amount is a fixed conversion price.

There are no other provisions that

could result in a variable number of shares required for settlement in the future

– equivalent to the number of shares common stock into which this series is convertible

- Liquidation

preference – none

of redemption – none

- Derivative liability – the Company

has considered relevant accounting guidance, and has determined that there are no provisions of this class of stock that would require

derivative liability treatment

- 500,000,000

shares authorized

and 1,806,612 shares issued and outstanding at June

30, 2024 and December 31, 2023, respectively

and 1,806,612 shares issued and outstanding at September 30, 2024 and December 31, 2023,

value - $ 0.0001

at 1 vote per share

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

and Incentive Plans

1 unchanged sentence

Stock Incentive Plans.

All issuances under these Plans has been noted below for the six months ended June 30, 2024 and the year ended

December 31, 2023, respectively.

Transactions for the Six Months Ended June 30, 2024

All issuances under these Plans has been noted below for the nine months ended September 30, 2024 and the year

ended December 31, 2023, respectively.

Transactions for the Nine Months Ended September 30, 2024

Issued for Debt Issuance Costs – Related Party

1 unchanged sentence

of $ 2,020,387 ($ 2.81 - $ 7.10 /share), based upon the quoted closing trading price.

lender (an entity controlled by the Company’s Chief Executive Officer) holds an approximate 27 % ownership of the Company.

lender (an entity controlled by the Company’s Chief Executive Officer) holds a greater than 20% ownership of the Company.

of Employee Shares

4 unchanged sentences

payments were $ 268,658 .

Issued for Services

Company issued 53,777 shares of common stock to consultants for services rendered, having a fair value of $ 187,968 ($ 0.0001 - $ 3.52 /share),

based upon the quoted closing trading price.

B, Preferred Stock Issued for Cash – Related party

Company issued 140,000 shares of Series B, preferred stock to a related party for $ 1,400,000 ($ 10 /stated value per share).

related party holds a greater than 20 % ownership of the Company.

Stock Issued in Debt Conversion – Related party

Company converted all outstanding principal ($ 6,215,000 )

and accrued interest ($ 316,130 )

into 3,525,341

shares of common stock.

At the time of conversion, the lender executed a 150 %

penalty interest feature.

As a result, and just prior to conversion, the Company increased its interest expense and related debt by

for a total of $ 9,796,696

of debt that was converted.

As a result of this debt conversion, the balance due to this lender was $ 0 .

The fair value of the common stock at the conversion date was $ 2.76 /share.

Accordingly, since this was a related party transaction, no gain on debt extinguishment

was recorded.

related party holds a greater than 20 % ownership of the Company.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

A, Preferred Stock Issued in Debt Conversion – Related party

August 16, 2024, the Company converted all outstanding principal ($ 2,420,000 )

and accrued interest ($ 0 )

share of Series A, Preferred Stock, $ 10 /share

stated value.

At the time of conversion, the lender executed a 150 %

penalty interest feature.

As a result, and just prior to conversion, the Company increased its interest expense and related debt by $ 1,210,000

for a total of $ 3,630,000

of debt that was converted.

As a result of this

debt conversion, the balance due to this related party lender was $ 0 .

related party holds a greater than 5 % ownership of the Company.

Note 5 regarding debt conversion and related loss on debt extinguishment.

A and B – Preferred Stock Dividends Payable in Common Stock – Related Parties

accordance with the terms of the Company’s Series A and B, Preferred stock, the Company is required to accrue dividends on a

quarterly basis.

Similar to the Series A and B, convertible preferred stock, dividends are accrued using a fixed conversion

There are no other provisions that could result in a variable number of shares required for settlement in the future.

Additionally, the Company has considered

relevant accounting guidance, and has determined that there are no provisions related to its dividends that would require derivative liability

The Company has calculated its dividends payable as follows:

of Dividends Payable

A - Convertible Preferred Stock

B - Convertible Preferred Stock

Dividends Payable

issued and outstanding

Stated value per

rate (10%/12%)

shares due per year

price - at issuance date

price - 70%/80% discount to market price

shares due per quarter

for days outstanding this period end

dividend shares due

price - reporting period end date

value of dividends payable

Transactions for the Year Ended December 31, 2023

9 unchanged sentences

was pursuant to vesting.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Issued for Services

7 unchanged sentences

lender holds a greater than 5 % controlling interest in the Company and a significant lender.

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Stock and Related Vesting

summary of the Company’s nonvested shares (due to service based restrictions) as of June 30, 2024 and December 31, 2023, is presented

summary of the Company’s nonvested shares (due to service based restrictions) as of September 30, 2024 and December 31, 2023, is

presented below:

Schedule of Company Nonvested Shares

Weighted Average

Non-Vested Shares

Balance - December 31, 2022

- December 31, 2022

Cancelled/Forfeited

Balance - December 31, 2023

- December 31, 2023

Cancelled/Forfeited

Balance - June 30, 2024

- September 30, 2024

Company has issued various equity grants to board directors, officers, consultants and employees.

1 unchanged sentence

period of one to three years and require services to be performed in order to vest in the shares granted.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Company determines the fair value of the equity grant on the issuance date based upon the quoted closing trading price.

5 unchanged sentences

compensation is reversed on the date of forfeiture, which is typically due to service termination.

June 30, 2024, unrecognized stock compensation expense related to restricted stock was $ 79,733 , which will be recognized over a weighted-average

period of 1.49 years

the three months ended June 30, 2024 and 2023, the Company recognized compensation expense of $ 104,000 and $ 28,167 , related to the vesting

of these shares.

the six months ended June 30, 2024 and 2023, the Company recognized compensation expense of $ 251,334 and $ 143,001 , related to the vesting

of these shares.

September 30, 2024, unrecognized stock compensation expense related to restricted stock was $ 62,400 , which will be recognized over a

weighted-average period of 1.29 years

the three months ended September 30, 2024 and 2023, the Company recognized compensation expense of $ 17,333 and $ 114,834 , related to the

vesting of these shares.

the nine months ended September 30, 2024 and 2023, the Company recognized compensation expense of $ 268,667 and $ 143,001 , related to the

vesting of these shares.

option transactions for the year ended December 31, 2023 is summarized as follows:

of Stock Option Activity

Stock Options

Outstanding - December 31, 2022

Vested and Exercisable - December 31, 2022

Unvested and non-exercisable - December 31, 2022

- December 31, 2022

and Exercisable - December 31, 2022

and non-exercisable - December 31, 2022

Cancelled/Forfeited

Outstanding - December 31, 2023

Vested and Exercisable - December 31, 2023

Unvested and non-exercisable - December 31, 2023

- December 31, 2023

and Exercisable - December 31, 2023

and non-exercisable - December 31, 2023

Ended December 31, 2023

Company granted 101,930 stock options, having a fair value of $ 73,920 .

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

the total, 21,930 were granted to our former Chief Executive Officer in lieu of accrued salary totaling $ 50,000 .

9 unchanged sentences

Schedule of Fair Value Assumptions

Expected term (years)

Expected volatility

Expected dividends

Risk free interest rate

free interest rate

HOLDINGS, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

2023, the Company determined that all outstanding options previously granted were held by former officers, directors and employees.

1 unchanged sentence

forfeiture of any issued and outstanding amounts held.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

activity for the six months ended June 30, 2024 and the year ended December 31, 2023 are summarized as follows:

activity for the nine months ended September 30, 2024 and the year ended December 31, 2023 are summarized as follows:

of Stock Warrant Activity

Exercise Price

Outstanding - December 31, 2022

Vested and Exercisable - December 31, 2022

Unvested - December 31, 2022

- December 31, 2022

and Exercisable - December 31, 2022

- December 31, 2022

Cancelled/Forfeited

Outstanding - December 31, 2023

Vested and Exercisable - December 31, 2023

Unvested and non-exercisable - December 31, 2023

- December 31, 2023

and Exercisable - December 31, 2023

and non-exercisable - December 31, 2023

Cancelled/Forfeited

Outstanding - June 30, 2024

Vested and Exercisable - June 30, 2024

Unvested and non-exercisable - June 30, 2024

- September 30, 2024

and Exercisable - September 30, 2024

and non-exercisable - September 30, 2024

9 – Material Definitive Agreement as Amended and Reverse Acquisition

5 unchanged sentences

in exchange for up to 40,000,000 shares of common stock.

agreement was amended on November 2, 2023, as follows:

shares of common stock will vest upon the closing of the acquisition of Next Charging,

shares of common stock will vest upon the acquisition of the first target;

shares of common stock will vest upon the Company commercially deploying the third solar,

wireless electric vehicle charging, microgrid, and/or battery storage system.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

an additional condition to be satisfied prior to the Closing, NextNRG is also required to take actions to record the assignment to itself

of a patent mentioned in the Amended and Restated Exchange Agreement.

September 25, 2024, the Company and the Shareholders’ Representative entered into the second amendment to the Second Amended and

Restated Exchange Agreement (“Second Amendment Agreement”) to change the number of the Company’s common stock shares

to be issued to the NextNRG Shareholders by the Company in exchange for 100 % of the shares of NextNRG to 100,000,000 shares of the Company’s

common stock.

Second Amendment Agreement also provides that in the event NextNRG completes the acquisition of STAT-EI, Inc.

(“SEI” or “STAT”),

prior to the closing, then 50,000,000 shares will vest on the closing date, and the remaining 50,000,000 shares will be subject to vesting

or forfeiture (such shares subject to vesting or forfeiture, the “Restricted Shares”).

As noted above, NextNRG completed

the acquisition of SEI on January 19, 2024, and thus 50,000,000 will vest on the closing date, and 50,000,000 Restricted Shares will

be subject to vesting or forfeiture.

25,000,000 of the 50,000,000 Restricted Shares will vest, if at all, upon the Company commercially

deploying the third solar, wireless electric vehicle charging, microgrid, and/or battery storage system (such systems as more specifically

defined under the Exchange Agreement) and 25,000,000 of the 50,000,000 Restricted Shares will vest, if at all, upon the Company either

reaching annual revenues exceeding $ 100 million, the Company completing projects with deployment costs greater than $ 100 million, or

the Company completing a capital raise greater than $ 25 million.

Second Amendment Agreement also provides that prior to the closing, NextNRG may issue additional shares of NextNRG Stock to one or more

additional persons and, in such event, such persons will execute a joinder to the Exchange Agreement and will become a party thereto.

In addition, prior to the closing, subject to the approval of the Shareholders’ Representative, certain shareholders of NextNRG

may transfer their shares of NextNRG Stock to persons who are currently shareholders of NextNRG or who would become new shareholders

Second Amendment Agreement also provides that the Company will undertake such actions as needed to obtain the approval of the stockholders

of the Company for the adoption and approval of the Exchange Agreement, as amended, and the transactions contemplated thereby including

the issuance of the Company’s common stock thereunder.

is a renewable energy company formed by Michael D.

14 unchanged sentences

March 1, 2024, Next Charging LLC reincorporated in the state of Nevada as a C-Corporation and changed its name to NextNRG Holding Corp.

of June 30, 2024 and the date of these financial statements, the agreement has not yet closed.

10 – Subsequent Events

Payable Related Party – Material Stockholder greater than 20%

to June 30, 2024, the Company executed several two-month (2) notes payable with an aggregate face amount of $ 495,000 , less original issue

discounts of $ 45,000 , resulting in net proceeds of $ 450,000 .

notes are initially due two-months (2) from their issuance dates.

If the notes reach maturity and are still outstanding, the notes and

related accrued interest will automatically renew for successive two-month (2) periods.

notes bear interest at 8 % for the 1 st nine-months (9), then 18 % each month thereafter.

HOLDING, INC.

AND SUBSIDIARY

TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

connection with obtaining these notes, the Company also issued 62,400 shares of common stock to the lender, which will be accounted for

as a debt discount.

lender is required to issue in writing any event of default.

If an event of default occurs, all outstanding principal and accrued interest

will be multiplied by 150% and become immediately due.

Additionally, if the Company raises $ 3,000,000 (debt or equity based), the entire

outstanding principal and accrued interest are immediately due.

in an event of default, the lender has the right to convert any or all of the outstanding principal and accrued interest into common

stock equal to the greater of the average VWAP closing price over the ten (10) trading days ending on the date of conversion or $ 1.75

(the floor price).

In the event such a conversion were to occur, which can only happen by default, the Company would evaluate the potential

for recording derivative liabilities.

lender is considered a related party as it is controlled by Michael Farkas, an approximate 27 % stockholder in the Company.

Note 5 for all other related note issuances with his lender.

– Continued Listing Rule or Standard

previously disclosed, on August 22, 2023, the Company received a letter from the Listing Qualifications Staff (the “Staff”)

of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that the Company’s stockholders’ equity did not comply with

the minimum $ 2,500,000 stockholders’ equity requirement for continued listing set forth in Listing Rule 5550(b) (the “Equity

Upon submission of the Company’s plan to regain compliance, the Staff granted the Company an extension until February

20, 2024 to comply with this requirement.

February 21, 2024, the Company received a delist determination letter (the “Delist Letter”) from the Staff advising the Company

that the Staff had determined that the Company did not meet the terms of the extension.

Specifically, the Company did not complete its

proposed transaction to regain compliance with the Equity Rule and evidence compliance on or before February 20, 2024.

See Form 8-K filed

on February 23, 2024.

Company had requested an appeal for the Staff’s determination.

A hearing occurred on May 2, 2024.

At the hearing, the Company presented

its plan for regaining compliance with the Equity Rule and may request a further extension to complete the execution of its plan.

assurance can be provided that Nasdaq will ultimately accept the Company’s plan or that the Company will ultimately regain compliance

with the Equity Rule.

in Authorized Shares

June 14, 2024, the Company’s Board of Directors authorized an increase to its common stock from 50,000,000 shares to 500,000,000

July 25, 2024, the Company’s Board of Directors authorized a 1:2.5 reverse stock split .

As a result, all share and per share amounts

have been retroactively restated to the earliest period presented in the accompanying consolidated financial statements.

of September 30, 2024 and the date of these financial statements, the transaction has not yet closed.

Note 10 - Subsequent Events

Lease Termination – Related Party

On October 1, 2024, the existing lease (see Note 7)

was terminated with no additional consideration paid for early termination.

Additionally, no penalties were incurred.

As a result, the

Company will record a gain on lease termination of $ 4,053 in the 4th quarter of 2024, calculated as follows:

of Gain on Lease Termination

ROU liability

Gain on lease termination

New Right-of-Use Asset – Related Party

On October 1, 2024, the Company signed a lease for 3,500 square

feet of office space owned by the Company’s Chief Technology Officer.

The lease term is 36 months, and the total monthly

payment is $ 10,300 , including base rent, estimated operating expenses and sales tax.

The lease is subject to a 3 % annual increase.

An initial Right of Use (“ROU”) asset of $ 340,368 will be recognized as a non-cash asset addition.

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