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Item 1. Financial Statements

2022-11-14 compared with 2022-10-12 · 200 added, 222 removed, 425 unchanged (50% of the section changed)

1 unchanged sentence

INNOVATIONS, INC.

FINANCIAL STATEMENTS

AND SIX MONTHS ENDED JUNE 30, 2022 AND 2021

CONSOLIDATED UNAUDITED BALANCE SHEETS AS OF JUNE 30, 2022 AND DECEMBER 31, 2021

CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS

CONSOLIDATED UNAUDITED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS

NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS

INNOVATIONS, INC.

BALANCE SHEETS

September 30,

Current Assets

Cash and cash equivalents

Accounts receivable

Unbilled receivables

Due from shareholder

Accounts receivable

Prepaid expenses

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Operating lease liability

Notes payable

Total long-term debt

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Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

Cost of services

5 unchanged sentences

( 1,064,870 )

( 1,774,445 )

Other income (expense):

Gain on extinguishment of liabilities

Gain on loan forgiveness

Interest expense

10 unchanged sentences

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

Three months ended June 30, 2022

Number of shares

1 unchanged sentence

Accumulated Deficit

Balance as of March 31, 2022

$ ( 49,588,652 )

Three Months Ended September 30, 2022

Number of Shares

Additional Paid-in Capital

Accumulated Deficit

Balance as of June 30, 2022

$ ( 50,031,838 )

Shares issued for cash

Shares issued in exchange for Range

Balance as of June 30, 2022

Balance as of September 30, 2022

$ ( 50,151,454 )

Three months ended June 30, 2021

Three Months Ended September 30, 2021

Number of Shares

1 unchanged sentence

Accumulated Deficit

Balance as of March 31, 2021

$ ( 47,427,709 )

Cancellation of common shares

Fair value of vested stock options

Balance as of June 30, 2021

$ ( 48,039,944 )

Six months ended June 30, 2022

Shares issued for cash

Balance as of September 30, 2021

$ ( 48,544,302 )

Nine Months Ended September 30, 2022

Number of Shares

6 unchanged sentences

Shares issued in exchange for Range

Balance as of June 30, 2022

( 1,010,776 )

Six months ended June 30, 2021

( 1,010,776 )

Balance as of September 30, 2022

$ ( 50,151,454 )

Nine Months Ended September 30, 2021

Number of Shares

4 unchanged sentences

$ ( 47,067,078 )

Shares issued for cash

Cancellation of common shares

Fair value of vested stock options

Balance as of June 30, 2021

( 1,477,224 )

Balance as of September 30, 2021

$ ( 48,544,302 )

accompanying notes to the consolidated financial statements.

1 unchanged sentence

STATEMENTS OF CASH FLOWS

Six Months Ended June 30,

Nine Months Ended

September 30,

Cash flows from operating activities:

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Changes in operating assets and liabilities:

Accounts receivable

Unbilled receivables

Interest accrued but not paid

Due from shareholder

Accounts receivable

Forgiveness of PPP loan

Prepaid expense

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Proceeds from long-term debt

Proceeds from line of credit

Payoff of SBA disaster loan

Payoff of line of credit

Net cash provided by financing activities

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Cash paid during the period for:

Forgiveness of PPP loan

Stock issued for acquisition

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TO CONSOLIDATED FINANCIAL STATEMENTS

AND SIX MONTHS ENDED JUNE 30, 2022 AND 2021

BUSINESS OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Innovations, Inc.

(the “Company”, “we”, “us” or “our”), was incorporated in the State

of Nevada on June 29, 2007.

(the “Company”) was incorporated in the State of Nevada on June 29, 2007.

founded in 2007 as Legend Mining Inc., the Company began operations as a mineral extraction exploration business.

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and (ii) Daedalus Ecosciences, Inc., a Nevada corporation (“Daedalus”).

Graphium plans to focus its business activities on the health and wellness of people, with a particular focus on advancing our broad

portfolio of over 100 glycosylated cannabinoid prodrugs.

Daedalus plans to focus its business activities on the health and wellness of

the planet through ESG investments, with a particular focus on deploying technological innovations and eco-friendly solutions to remedy

Graphium plans to focus its business activities on the health and wellness of people, with a particular focus on advancing the Company’s

broad portfolio of over 100 glycosylated cannabinoid prodrugs.

Daedalus plans to focus its business activities on the health and wellness

of the planet through ESG investments, with a particular focus on deploying technological innovations and eco-friendly solutions to remedy

difficult environmental situations in economically challenged communities.

May 2022, Daedalus acquired Range Environmental Resources, Inc., a West Virginia corporation (“Range Environmental”) and

Range Natural Resources, Inc., a West Virginia corporation (“Range Natural” and together with Range Environmental, the

“Range Entities”).

The Range Entities provide land reclamation, water restoration and environmental consulting services

to mining and non-mining customers throughout the Appalachian region with the goal of returning land to pre-mining conditions or

repurpose the land for natural, commercial, agricultural or recreational use.

The Range Entities’ water restoration services

seek to improve rivers, streams and discharges through novel and innovative treatment applications to help customers meet their

various regulatory standards and requirements.

The Range Entities also provide environmental consulting services to customers

typically in connection with land reclamation and water restoration projects and as an additional value-add service, sells

water treatment chemicals manufactured by third parties to their customers.

Range Natural Resources, Inc., a West Virginia corporation (“Range Natural” and together with Range Environmental, the “Range

The Range Entities provide land reclamation, water restoration and environmental consulting services to mining and

non-mining customers throughout the Appalachian region with the goal of returning land to pre-mining conditions or repurposing the land

for natural, commercial, agricultural or recreational use.

The Range Entities’ water restoration services seek to improve rivers,

streams and discharges through novel and innovative treatment applications to help customers meet their various regulatory standards

and requirements.

The Range Entities also provide environmental consulting services to customers typically in connection with land reclamation

and water restoration projects and as an additional value-add service, sells water treatment chemicals manufactured by third parties

to their customers.

accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement

of liabilities and commitments in the normal course of business.

As reflected in the accompanying financial statements, during the six

months ended June 30, 2022, the Company incurred a net loss of $ 891,160 and used $ 845,068 of cash in our operating activities.

factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the

financial statements are issued.

The financial statements do not include any adjustments that might be necessary should the Company be

unable to continue as a going concern.

As reflected in the accompanying financial statements, during the nine

months ended September 30, 2022, the Company incurred a net loss of $ 1,010,776 and used $ 568,536 of cash in the Company’s operating

These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of

the date that the financial statements are issued.

The financial statements do not include any adjustments that might be necessary should

the Company be unable to continue as a going concern.

ability to continue as a going concern is dependent on the Company attaining and maintaining profitable operations in the future and/or

raising additional capital to meet its obligations and repay its liabilities arising from normal business operations when they come due.

We estimate as of June 30, 2022, we had sufficient funds to operate the business for 18 months given our cash balance of $ 1,866,289 ,

line of credit availability of $ 150,000 , the availability of $4,830,050 under our $5,000,000 equity financing line via an executed securities

purchase agreement, and revenues being generated by the Range Entities .

Although our existing cash balances are estimated to be sufficient

to fund our currently planned level of operations, we are actively seeking additional financing and other sources of capital to accelerate

the funding and execution of our growth strategy and value creation plan.

However, these estimates could differ if we encounter unanticipated

difficulties, or if our estimates of the amount of cash necessary to operate our business prove to be wrong, and we use our available

financial resources faster than we currently expect.

No assurance can be given that any future financing or capital, if needed, will

be available or, if available, that it will be on terms that are satisfactory to the Company.

The Company estimates, as of September 30, 2022, that it has sufficient funds to operate the business for 18 months given its cash balance

of $ 1,156,799 , line of credit availability of $ 1,000,000 , the availability of $4,830,050 under its $5,000,000 equity financing line via

an executed securities purchase agreement, and revenues being generated by the Range Entities .

Although the Company’s existing

cash balances are estimated to be sufficient to fund its currently planned level of operations, the Company is actively seeking additional

financing and other sources of capital to accelerate the funding and execution of its growth strategy and value creation plan.

these estimates could differ if the Company encounters unanticipated difficulties, or if its estimates of the amount of cash necessary

to operate its business prove to be wrong, and the Company uses its available financial resources faster than it currently expects.

No assurance can be given that any future financing or capital, if needed, will be available or, if available, that it will be on terms

that are satisfactory to the Company.

of Presentation

consolidated financial statements include the accounts of the Company and its wholly owned direct subsidiaries, Graphium

Biosciences, Inc., Daedalus Ecosciences, Inc., and Vitality Healthtech, Inc.

(dissolved in May 2021), and its wholly-owned indirect

subsidiaries, Range Environmental Resources, Inc.

and Range Natural Resources, Inc., and have been prepared in accordance with accounting principles generally accepted in the United States of America.

consolidated financial statements include the accounts of the Company and its wholly-owned direct subsidiaries, Graphium Biosciences,

Inc., Daedalus Ecosciences, Inc., and Vitality Healthtech, Inc.

(dissolved in May 2021), and its wholly-owned indirect subsidiaries,

Range Environmental Resources, Inc.

and Range Natural Resources, Inc., and have been prepared in accordance with accounting principles

generally accepted in the United States of America.

Intercompany balances and transactions have been eliminated in consolidation.

The Company’s fiscal year end is December

Company’s fiscal year end is December 31.

preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires

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Based on management’s assessment, it has concluded that losses on balances outstanding

as of those dates will be immaterial and, therefore, no allowances were recorded for the three or six months ended June 30, 2022 or June

as of those dates will be immaterial and, therefore, no allowances were recorded for the three or nine months ended September 30, 2022

or September 30, 2021.

is carried at cost.

3 unchanged sentences

loss is reflected in the current year’s earnings.

June 30, 2022

December 31, 2021

September 30,

Depreciation expense

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ASC 842 “Leases” requires the Company to determine whether a contract is, or contains, a lease at inception.

Right-of-use assets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities

represent the Company’s obligation to make lease payments arising from the lease.

Right-of-use assets and lease liabilities

are recognized at lease commencement based upon the estimated present value of unpaid lease payments over the lease term.

Company uses its incremental borrowing rate based on the information available at lease commencement in determining the present

value of unpaid lease payments.

assets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities represent the Company’s

obligation to make lease payments arising from the lease.

Right-of-use assets and lease liabilities are recognized at lease commencement

based upon the estimated present value of unpaid lease payments over the lease term.

The Company uses its incremental borrowing rate

based on the information available at lease commencement in determining the present value of unpaid lease payments.

Company follows the asset and liability method of accounting for income taxes.

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for services.

The Company accounts for such grants issued and vesting based on FASB ASC 718 “Compensation-Stock Compensation” whereby

the value of the award is measured on the date of grant and recognized for employees as compensation expense on the straight-line basis

over the vesting period.

Recognition of compensation expense for non-employees is in the same period and manner as if the Company had

paid cash for the services.

The Company recognizes the fair value of stock-based compensation within its Consolidated Statements of Operations

with classification depending on the nature of the services rendered.

The Company accounts for such grants issued and vesting based on FASB ASC 718 “Compensation-Stock Compensation”

whereby the value of the award is measured on the date of grant and recognized for employees as compensation expense on the straight-line

basis over the vesting period.

Recognition of compensation expense for non-employees is in the same period and manner as if the Company

had paid cash for the services.

The Company recognizes the fair value of stock-based compensation within its Consolidated Statements

of Operations with classification depending on the nature of the services rendered.

fair value of the Company’s stock options is estimated using the Black-Scholes-Merton Option Pricing model, which uses certain

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SCHEDULE OF ANTI-DILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE

June 30, 2022

December 31, 2021

September 30,

and Patent Application Costs

the Company believes that its patents and underlying technology have continuing value, the amount of future benefits to be derived from

the Company believes that its patents and underlying technology have continuing value, the future benefits to be derived from

the patents is uncertain.

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costs are expensed as incurred.

of October 1, 2021, we began operating under two segments:

(i) Graphium Biosciences, Inc., a wholly-owned subsidiary of the Company,

will report the operating results of our health and wellness innovations serving people, with a particular focus on advancing our broad

portfolio of over 100 glycosylated cannabinoid prodrugs, and (ii) Daedalus Ecosciences, Inc., a wholly-owned subsidiary of the Company,

will report the operating results of our health and wellness innovations serving the planet, with a particular focus on deploying technological

innovations and eco-friendly solutions to remedy difficult environmental situations in economically challenged communities.

of October 1, 2021, the Company began operating under two segments:

(i) Graphium Biosciences, Inc., a wholly-owned subsidiary of the

Company, will report the operating results of its health and wellness innovations serving people, with a particular focus on advancing

its broad portfolio of over 100 glycosylated cannabinoid prodrugs, and (ii) Daedalus Ecosciences, Inc., a wholly-owned subsidiary of

the Company, will report the operating results of its health and wellness innovations serving the planet, with a particular focus on

deploying technological innovations and eco-friendly solutions to remedy difficult environmental situations in economically challenged

accordance with FASB ASC 280 “Segment Reporting”, the Company’s chief operating decision maker has been identified

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for 80 % of the outstanding common stock of each of the Range Entities.

to entering into the Share Purchase Agreement, the Company discovered that Joshua Justice, one of the Range Shareholders

(“Justice”), made certain misrepresentations in the Share Purchase Agreement.

On July 12, 2022, the Company entered into

a Separation Agreement, by and among the Company, Daedalus Ecosciences, the Range Entities, and Justice and his spouse (the

“Separation Agreement”) pursuant

to which Justice:

to entering into the Share Purchase Agreement, the Company discovered that Joshua Justice, one of the Range Shareholders (“Justice”),

made certain misrepresentations in the Share Purchase Agreement.

On July 12, 2022, the Company entered into a Separation Agreement, by

and among the Company, Daedalus Ecosciences, the Range Entities, and Justice and his spouse (the “Separation Agreement”)

pursuant to which Justice:

a) acknowledged that his employment with the Range Entities was terminated for cause effective June 30, 2022;

returned the 5,000,000 shares of the Company’s common stock that had been issued to him under the terms of the Share Purchase

b) returned the 5,000,000 shares of the Company’s common stock that had been issued to him under the terms of the Share Purchase

c) transferred his 10% interest in each of the Range Entities to Daedalus Ecosciences;

and d) paid Daedalus Ecosciences

cash in an amount of $250,000.

As a result, only 5,000,000 of the Company’s common stock issued to the Range Shareholders is

considered to have been issued in exchange for 90% of the outstanding common stock of each of the Range Entities .

and d) paid Daedalus Ecosciences cash

in an amount of $250,000.

As a result, only 5,000,000 of the Company’s common stock issued to the Range Shareholders is considered

to have been issued in exchange for 90% of the outstanding common stock of each of the Range Entities .

Subsequently,

on October 11, 2022, Daedalus Ecosciences and Jeremy Starks, the other Range Shareholder (“Starks”), entered into a

share purchase agreement, effective as of May 11, 2022 (the “Starks Agreement”) pursuant to which Starks agreed to

exchange his 10 % common

stock ownership of the Range Entities for 10 % of the Cash Dividends and Sale Proceeds

(as both terms are defined in the Starks Agreement) of the Range Entities, as a result of which, the Range Entities are now wholly-owned

subsidiaries of Daedalus Ecosciences and the Range Entities are reported as wholly-owned indirect subsidiaries of the Company in the financial

statements made part of this Form 10-Q.

No other changes were made to the consideration received by Mr.

Starks as part of the Share Purchase

Agreement and he remains as President of each of the Range Entities.

on October 11, 2022, Daedalus Ecosciences and Jeremy Starks, the remaining Range Shareholder (“Starks”), entered into a share

purchase agreement, effective as of May 11, 2022 (the “Starks Agreement”), pursuant to which Starks exchanged his 10 % common

stock ownership of the Range Entities for 10 % of the Cash Dividends and Sale Proceeds (as both terms are defined in the Starks Agreement)

of the Range Entities, as a result of which, the Range Entities are now wholly-owned subsidiaries of Daedalus Ecosciences and the Range

Entities are reported as wholly-owned indirect subsidiaries of the Company in the financial statements made part of this Form 10-Q.

other changes were made to the consideration received by Starks as part of the Share Purchase Agreement and he remains as President

of each of the Range Entities.

Company accounted for the transaction as a business combination in accordance ASC 805 “Business Combinations”.

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Acquisition transaction costs incurred

increased to $ 751,421 at June 30, 2022.

has an assigned value of $ 751,421 and represents the value of the Range Entities’ brand reputation,

customer base and employee relations.

increased to $ 751,421 at September 30, 2022.

There had been no goodwill at December 31, 2021.

The increase in goodwill was driven by the addition

of the Range Entities in the quarter and represents the value of the Range Entities’ brand

reputation, customer base and employee relations .

The increase in goodwill was driven by

the addition of the Range Entities in the period and represents the value of the Range Entities’

brand reputation, customer base and employee relations .

Goodwill by reportable segment is as follows:

September 30,

ESG Operations Segment:

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May 2022, the Company entered into two securities purchase agreements providing for the issuance and sale by the Company of (i) 20,000,000

shares of the Company’s common stock (the “Shares”) at a price of $ 0.15 per share and (ii) warrants to purchase up

to an additional 20,000,000 shares of the Company’s common stock (the “Warrants”, and the shares issuable upon exercise

of the Warrants, the “Warrant Shares”) at a price of $ 0.60 per share.

The Warrants expire on May 10, 2027.

The aggregate proceeds

to the Company from the sale of the Shares and Warrants was $ 3,000,000 .

shares of the Company’s common stock (the “May Shares”) at a price of $ 0.15 per share and (ii) warrants to purchase

up to an additional 20,000,000 shares of the Company’s common stock (the “May Warrants”, and the shares issuable upon

exercise of the Warrants, the “May Warrant Shares”) at a price of $ 0.60 per share.

The May Warrants expire on May 10, 2027.

The aggregate proceeds to the Company from the sale of the May Shares and May Warrants was $ 3,000,000 .

August 2022, the Company entered into a securities purchase agreement providing for the issuance and sale by the Company of (i) 1,666,667

shares of the Company’s common stock (the “August Shares”) at a price of $ 0.15 per share and (ii) warrants to purchase

up to an additional 1,666,667 shares of the Company’s common stock (the “August Warrants”, and the shares issuable

upon exercise of the Warrants, the “August Warrant Shares”) at a price of $ 0.60 per share.

The August Warrants expire on

August 26, 2027.

The aggregate proceeds to the Company from the sale of the August Shares and August Warrants was $ 250,000 .

May 2022, the Company purchased 90 % of the outstanding common stock of each of the Range Entities for a combination of Company shares

1 unchanged sentence

Only 5,000,000 of the Company’s common stock issued to the Range Shareholders is considered outstanding

as of June 30, 2022, in order to reflect the effects of the Separation Agreement.

as of September 30, 2022, in order to reflect the effects of the Separation Agreement.

STOCK OPTIONS

summary of the Company’s stock option activity during the six months ended June 30, 2022 is as follows:

summary of the Company’s stock option activity during the nine months ended September 30, 2022 is as follows:

SCHEDULE OF STOCK OPTION ACTIVITY

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Balance outstanding at December 31, 2021

Balance outstanding at June 30, 2022

Balance exercisable at June 30, 2022

summary of the Company’s stock options outstanding and exercisable as of June 30, 2022 is as follows:

Balance outstanding at September 30, 2022

Balance exercisable at September 30, 2022

summary of the Company’s stock options outstanding and exercisable as of September 30, 2022 is as follows:

SCHEDULE OF STOCK OPTIONS OUTSTANDING AND EXERCISABLE

Weighted Average Exercise Price

Weighted Average Grant- date Stock Price

Options Outstanding, June 30, 2022

Exercise Price

Average Grant-

date Stock Price

Options Outstanding, September 30, 2022

$ 1.50 – 1.95

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$ 4.00 – 4.70

Options Exercisable, June 30, 2022

Options Exercisable, September 30, 2022

$ 1.50 – 1.95

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$ 4.00 – 4.70

is no remaining unamortized cost of the outstanding stock-based awards at June 30, 2022.

At June 30, 2022, the 6,752,544 outstanding

is no remaining unamortized cost of the outstanding stock-based awards at September 30, 2022.

At September 30, 2022, the 6,742,544 outstanding

stock options had no intrinsic value.

summary of warrants to purchase common stock during the six months ended June 30, 2022 is as follows:

summary of the Company’s warrant activity during the nine months ended September 30, 2022 is as follows:

SCHEDULE OF WARRANTS ACTIVITY

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Expired/Cancelled

Balance outstanding and exercisable at June 30, 2022

June 30, 2022, the 20,646,668 outstanding stock warrants had no intrinsic value.

Balance outstanding and exercisable at September 30, 2022

September 30, 2022, the 22,313,335 outstanding stock warrants had no intrinsic value.

NOTES PAYABLE

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Protection Program (the “PPP”) under the CARES Act.

PPP loan matures on March 9, 2023 and bears interest at a rate of 1 % per annum, with the first six months of interest deferred.

PPP loan had a maturity date of March 9, 2023 and bore interest at a rate of 1 % per annum, with the first six months of interest deferred.

August 19, 2022, Range Environmental received notice that the U.S.

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accrued interest.

June 17, 2020, Range Environmental was granted an SBA Disaster Loan in the amount of $ 150,000 with

an interest rate of 3.75 %

On September 14, 2022, the Company paid

the entire balance due on this loan of $ 162,575 ,

including $ 12,575

in accrued interest.

following notes payable are outstanding as of June 30, 2022:

OF NOTES PAYABLE

SBA Disaster Loan

Total notes payable

The Company recognized a gain on extinguishment

of the PPP loan of $ 109,435 during the three and nine months ended September 30, 2022.

June 17, 2020, Range Environmental was granted an SBA Disaster Loan in the amount of $ 150,000 with an interest rate of 3.75 % per annum.

On September 14, 2022, the Company paid the entire balance

due on this loan of $ 162,575 , including $ 12,575 in accrued interest.

Company had no notes payable outstanding as of September 30, 2022.

LINE OF CREDIT

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has a maturity date of November 30, 2022 , and bears interest at one percent ( 1 % ) above the prime rate.

As of June 30, 2022, the balance

due under the line of credit was $ 850,000 .

August 2021, the Company entered into a $ 5,000,000

equity line transaction with Triton Funds, LP (“Triton”) providing for the issuance and sale by the Company to Triton of

a number of shares of the Company’s common stock having an aggregate value of up to $ 5,000,000

and warrants to purchase up to an equal number of shares of the Company’s common stock.

In its sole discretion and subject to

certain agreed upon funding conditions, the

Company may submit, from time to time, notices obligating Triton to purchase shares with a value of up to $250,000 until the

financing arrangement expires on December 31, 2022 or Triton has purchased the $5,000,000 of shares pursuant to the equity line

transaction .

As of June 30, 2022, $ 4,830,050

is available under this equity line.

As of September 30, 2022, there

was no balance due under the line of credit.

August 2021, the Company entered into a $ 5,000,000 equity line transaction with Triton Funds, LP (“Triton”) providing for

the issuance and sale by the Company to Triton of a number of shares of the Company’s common stock having an aggregate value of

up to $ 5,000,000 and warrants to purchase up to an equal number of shares of the Company’s common stock.

In its sole discretion

and subject to certain agreed upon funding conditions, the Company may submit, from time to time, notices obligating Triton to purchase

shares with a value of up to $250,000 until the financing arrangement expires on December 31, 2022 or Triton has purchased the $5,000,000

of shares pursuant to the equity line transaction.

As of September 30, 2022, $ 4,830,050 was available under this equity line .

GAIN ON EXTINGUISHMENT OF ADVANCE

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by the statute of limitations and the Company recorded relief of this liability and a gain from debt extinguishment of $ 296,653 during

the six months ended June 30, 2021.

the nine months ended September 30, 2021.

LONG-TERM DEBT OBLIGATIONS

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Interest rates range from 3.69 % to 8.99 % for 2022.

The debt matures from 2022 through 2028 .

The aggregate amount of the debt was $ 1,258,382 at June 30, 2022, $ 392,708 of which is

due within one year of June 30, 2022, and $ 865,674 is due after June 30, 2023.

debt matures from 2022 through 2028.

The aggregate amount of the debt was $ 1,166,674 at September 30, 2022, $ 396,939 of which is due

within one year of September 30, 2022, and $ 769,735 is due after September 30, 2023.

summary of payments due under the long-term debt by year is as follows:

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OPERATING LEASE

Company has an operating lease agreement for one piece of equipment leased by Range Environmental Resources with a remaining lease term

Company has an operating lease agreement for one piece of equipment leased by Range Environmental with a remaining lease term

of 31 months.

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present value of lease payments over the lease term.

ROU assets represent our right to use an underlying asset for the lease term and

lease liabilities represent our obligation to make lease payments arising from the lease.

Generally, the implicit rate of interest in

arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of

lease payments.

The Company’s incremental borrowing rate is a hypothetical rate based on its understanding of what its credit rating

ROU assets represent the Company’s right to use an underlying asset for the

lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

Generally, the implicit rate

of interest in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present

value of lease payments.

The Company’s incremental borrowing rate is a hypothetical rate based on its understanding of what its

credit rating would be.

The operating lease ROU asset includes any lease payments made and excludes lease incentives.

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OF COMPONENTS OF LEASE EXPENSE

Three and Six

June 30, 2022

September 30, 2022

Operating lease cost (included in general and administrative expenses in the Company’s unaudited consolidated statements of operations)

Other Information

Cash paid for amounts included in the measurement of lease liabilities for the six months ended June 30, 2022

Cash paid for amounts included in the measurement of lease liabilities for the three months ended September 30, 2022

Weighted average remaining lease term – operating leases (in years)

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OF LEASES SUPPLEMENTAL BALANCE SHEET INFORMATION

At June 30, 2022

At September 30,

Operating leases

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Present value of lease liabilities

expenses related to leases with a duration of one year or less were $ 8,620 and $ 8,213 during the three months ended June 30, 2022 and

June 30, 2021, respectively.

Lease expenses related to leases with a duration of one year or less were $ 16,870 and $ 15,720 during the

six months ended June 30, 2022 and June 30, 2021, respectively.

expenses related to leases with a duration of one year or less were $ 8,746 and $ 8,013 during the three months ended September 30, 2022

and September 30, 2021, respectively.

Lease expenses related to leases with a duration of one year or less were $ 25,417 and $ 23,733 during

the nine months ended September 30, 2022 and September 30, 2021, respectively.

MAJOR CUSTOMER AND CONCENTRATION OF CREDIT RISK

to the Company’s two largest customers were 91 % of total sales for the three and six months ended June 30, 2022.

receivable from the same two customers were 93 % of total accounts receivable and unbilled receivables as of June 30, 2022.

to the Company’s largest customer were 74 % and 73 % of total sales for the three and nine months ended September 30, 2022, respectively.

receivable from the same customer were 61 % of total accounts receivable and unbilled receivables as of September 30, 2022.

COMMITMENTS AND CONTINGENCIES

1 unchanged sentence

(the “insurer”) demanding that the Company reimburse the insurer for sums advanced by the insurer to a former director of

the Company as defense costs in connection with a claim purportedly arising under a previous director’s and officer’s insurance policy.

The Company believes it has no liability for this claim on the basis of, among other things, Nevada law, the Company’s governing

documents and the language of the policy.

Accordingly, as of June 30, 2022, no contingent liability has been recorded in the Company’s

consolidated statements of financial condition for this matter.

the Company as defense costs in connection with a claim purportedly arising under a previous director’s and officer’s insurance

The Company believes it has no liability for this claim on the basis of, among other things, Nevada law, the Company’s

governing documents and the language of the policy.

Accordingly, as of September 30, 2022, no contingent liability has been recorded

in the Company’s consolidated statements of financial condition for this matter.

SEGMENT INFORMATION

21 unchanged sentences

OF FINANCIAL INFORMATION OF REPORTABLE SEGMENT

For the three months ended June 30, 2022

For the Three Months Ended September 30, 2022

Therapeutic Operations

Cost of services

Net income (loss)

$ ( 226,737 )

1 unchanged sentence

Capital expenditures for long-lived assets

For the six months ended June 30, 2022

For the Nine Months Ended September 30, 2022

Cost of services

Net income (loss)

$ ( 824,198 )

1 unchanged sentence

Capital expenditures for long-lived assets

For the three months ended June 30, 2021

For the Three Months Ended September 30, 2021

Therapeutic Operations

2 unchanged sentences

Capital expenditures for long-lived assets

For the six months ended June 30, 2021

For the Nine Months Ended September 30, 2021

Therapeutic Operations

4 unchanged sentences

SUBSEQUENT EVENTS

August 19, 2022, Range Environmental received notice that the SBA had reviewed the forgiveness application of Range Environmental’s

PPP loan and provided forgiveness of the entire principal of the PPP loan plus accrued interest, which totaled an amount of debt forgiveness

equal to $ 109,435 .

August 31, 2022, the Company paid the entire balance due on the unsecured bank credit line of $ 863,305 , including $ 13,305 in accrued

September 14, 2022, the Company paid the entire balance due on the SBA Disaster Loan of $ 162,575 , including $ 12,575 in accrued interest.

July 12, 2022, the Company and Daedalus Ecosciences entered into the Separation Agreement pursuant to which, among other things, Justice:

a) acknowledged that his employment with the Range Entities was terminated for cause effective June 30, 2022;

b) returned the 5,000,000

shares of the Company’s common stock that had been issued to him under the terms of the Share Purchase Agreement;

c) transferred

his 10% interest in each of the Range Entities to Daedalus Ecosciences;

and d) paid Daedalus Ecosciences cash in the amount of $250,000 .

August 26, 2022, the Company entered into a securities purchase agreement with HTGT Enterprises LLC (“HTGT”) providing

for the issuance and sale by the Company to HTGT of (i) 1,666,667

shares of the Company’s common stock (the “HTGT Shares”) at a price of $ 0.15

per share and (ii) a warrant to purchase up to an additional 1,666,667

shares of the Company’s common stock (the “HTGT Warrant”, and the shares issuable upon exercise of the Warrant,

the “HTGT Warrant Shares”) at a price of $ 0.60

After deducting for fees and expenses, the aggregate net proceeds from the sale of the HTGT Shares and the HTGT Warrant

are approximately $ 248,000 .

October 11, 2022, Daedalus Ecosciences and Starks entered into the Starks Agreement pursuant to

which Daedalus Ecosciences acquired Starks’ 10 % common

stock ownership interest in the Range Entities.

As a result of this transaction, Daedalus Ecosciences is the sole shareholder of the

Range Entities.

No other changes were made to the consideration received by Starks as part of the Share Purchase Agreement entered into on May 11, 2022,

and he remains as President of each of the Range Entities.

which Daedalus Ecosciences acquired Starks’ 10 % common stock ownership interest in the Range Entities.

As a result of this transaction,

Daedalus Ecosciences is the sole shareholder of the Range Entities.

No other changes were made to the consideration received by Starks

as part of the Share Purchase Agreement entered into on May 11, 2022, and he remains as President of each of the Range Entities.

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