What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-05-15 compared with 2022-11-14 · 672 added, 412 removed, 34 unchanged (97% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

used in this discussion and analysis and elsewhere in this Quarterly Report, the “Company” refers to Malachite Innovations,

Inc., a Nevada corporation.

following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction

with the Company’s Unaudited Consolidated Financial Statements and the related notes thereto contained in Part I, Item 1 of this

Quarterly Report.

The information contained in this Quarterly Report on Form 10-Q is not a complete description of the Company’s

business or the risks associated with an investment in the Company’s common stock.

The Company urges you to carefully review and

consider the various disclosures made by the Company in this Quarterly Report and in the Company’s other reports filed with the

Securities and Exchange Commission (the “SEC”), including the Company’s Transition Report on Form 10-KT for the nine

months ended December 31, 2021 filed on March 31, 2022, and the related audited financial statements and notes included therein.

used in this discussion and analysis and elsewhere in this Quarterly Report, the “Company”, “we”, “us”

or “our” refer to Malachite Innovations, Inc., a Nevada corporation.

following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Unaudited

Condensed Financial Statements and the related notes thereto contained in Part I, Item 1 of this Quarterly Report.

The information contained

in this Quarterly Report on Form 10-Q is not a complete description of our business or the risks associated with an investment in our

common stock.

We urge you to carefully review and consider the various disclosures made by us in this Quarterly Report and in our other

reports filed with the Securities and Exchange Commission (the “SEC”), including our Annual Report on Form 10-K for the year

ended December 31, 2022 filed on March 31, 2023, and the related audited financial statements and notes included therein.

statements made in this Quarterly Report on Form 10-Q constitute “forward-looking statements” within the meaning of Section

1 unchanged sentence

Forward-looking

statements are projections in respect of future events or the Company’s future financial performance.

In some cases, you can identify

forward-looking statements by terminology such as “may,” “will,” “should,” “intend,”

“expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,”

“potential,” or “continue” or the negative of these terms or other comparable terminology.

These statements are

only predictions and involve known and unknown risks, uncertainties and other factors, which may cause the Company’s or its industry’s

actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance

expressed or implied by these forward-looking statements.

statements are projections in respect of future events or our future financial performance.

In some cases, you can identify forward-looking

statements by terminology such as “may,” “will,” “should,” “intend,” “expect,”

“plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,”

or “continue” or the negative of these terms or other comparable terminology.

These statements are only predictions and involve

known and unknown risks, uncertainties and other factors, which may cause our or our industry’s actual results, levels of activity

or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking

These risks and uncertainties include:

general economic and financial market

the Company’s ability to obtain additional financing as necessary;

the Company’s ability to continue operating

as a going concern;

any adverse occurrence with respect to the Company’s business or;

results of the Company’s research and

development activities that are less positive than it expects;

the Company’s ability to bring its intended products to market;

market demand for the Company’s intended products;

general economic and financial market conditions;

our ability to obtain additional

financing as necessary;

our ability to continue operating as a going concern;

any adverse occurrence with respect to our business or;

results of our research and development activities that are less positive than we expect;

our ability to bring our intended products

market demand for our intended products;

shifts in industry capacity;

product development or other initiatives by the Company’s

fluctuations in the availability and costs of raw materials required in the Company’s drug development process;

factors beyond the Company’s control;

and the other risks described under the heading “Risk Factors” in the Company’s

Transition Report on Form 10-KT filed with the SEC on March 31, 2022.

the Company believes that the expectations and assumptions reflected in the forward-looking statements it makes are reasonable, the Company

cannot guarantee future results, levels of activity or performance.

In addition, the Company cannot assess the impact of each factor

on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those

expressed by any forward-looking statements.

As a result, readers should not place undue reliance on any of the forward-looking statements

the Company makes in this report.

Forward-looking statements speak only as of the date on which they are made.

Except as required by

law, the Company undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

otherwise provided in this Quarterly Report, references to the “Company” refer to Malachite Innovations, Inc., a Nevada corporation

formed on June 29, 2007 as Legend Mining Inc., and its consolidated subsidiaries.

On October 10, 2011, the Company completed a merger

with its wholly-owned subsidiary, Stevia First Corp., whereby the Company changed its name from “Legend Mining Inc.” to “Stevia

First Corp.” On July 15, 2016, the Company’s Board of Directors and shareholders approved a name change to “Vitality

Biopharma, Inc.” On October 1, 2021, the Company completed a merger with its wholly-owned subsidiary, Malachite Innovations, Inc.,

whereby the Company changed its name from “Vitality Biopharma, Inc.” to “Malachite Innovations, Inc.”

Innovations is a company focused on improving the health and wellness of people and the planet.

The Company seeks to accomplish this objective

through the operation of two wholly-owned subsidiaries:

(i) Graphium Biosciences, Inc.

which is focused on developing new innovations

targeting the health and wellness of people, with a particular focus on advancing its broad portfolio of over 100 glycosylated cannabinoid

prodrugs and (ii) Daedalus Ecosciences, Inc.

which is focused on evaluating new innovations targeting the health and wellness of the

planet through an Environmental, Social and Governance (“ESG”) business strategy, with a particular focus on deploying technological

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

Company’s corporate headquarters is located in Cleveland, Ohio.

As of September 30, 2022, the Company employed twenty-three full-time

employees, including twenty employees of the Range Entities, one cannabinoid research scientist working in the Company’s office

and laboratory space in Rocklin, California, and two senior executives of the Company.

The Company also has, in the past, engaged the

services of scientific and regulatory consultants to assist in its research and development activities, which is an approach that provides

the Company with flexible and experienced resources to advance its corporate objectives while maintaining a relatively lower overhead

cost structure.

Biosciences, Inc.

Company’s cannabosides are cannabinoid-glycoside prodrugs, which were discovered through application of the Company’s proprietary

enzymatic bioprocessing technologies that are converted within the body after administration from an inactive molecule into a pharmacologically

Currently, the Company has produced more than 100 novel cannabosides, including glycosylated tetrahydrocannabinol (THC),

cannabidiol (CBD), cannabidivarin (CBDV) and cannabinol (CBN), that are covered by worldwide patents and patent applications for composition

of matter, method of production and method of use.

prodrug is a compound that, after administration, is metabolized into a pharmacologically active drug.

Prodrugs are often designed to

improve drug properties and reduce known or expected toxicities and adverse side effects.

By using the Company’s proprietary enzymatic

bioprocessing technologies, its clinical research team has developed a novel family of prodrugs by combining cannabinoid and glucose

The resulting compounds, known as cannabosides, have unique commercial applications and patentable compositions of matter,

which are separate and distinct from ordinary cannabinoids.

The advantages of cannabosides may include:

(i) administration in a convenient

oral formulation, (ii) targeted delivery with release in the colon or large intestine, (iii) improved stability with limited degradation

or drug metabolism, and (iv) delayed release enabling longer-lasting effects and fewer administrations by patients.

Company’s proprietary glycosylation process, which results in adding one or more glucose molecules to compounds, may enable

its new cannabosides to act as prodrugs that achieve targeted delivery of the bioactive compounds of cannabinoids to the

gastrointestinal tract.

Glycosylated compounds are generally more stable and water soluble, so upon ingestion, the Company believes

they will remain intact and transit through the esophagus, stomach and upper intestine with limited absorption or degradation from

stomach acids.

However, once the glycosylated compounds reach the large intestine, the Company expects them to encounter glycoside

hydrolase enzymes secreted by the human intestinal microbiota that will cleave the polar glucose residues and release the active

cannabinoid compound primarily in the large intestine or colon.

Company has focused its research and development activities on the glycosylation of cannabinoids given their well-known positive effects

on the human endocannabinoid system.

The Company’s research and development activities originally focused on the glycosylation

of CBD and then later expanded into the glycosylation of THC.

The use of the cannabinoid THC has been shown to provide substantial anti-inflammatory

benefits on the human body, among other benefits, but is limited as a pharmaceutical option given its psychoactive and intoxicating properties.

However, by glycosylating THC, the Company has learned through initial animal studies that the binding of glucose and THC molecules restricts

the release of THC into the body’s digestive system until the prodrug reaches the large intestine, at which point the glycoside

hydrolase enzymes cleave the glucose from the prodrug and the THC is released in a targeted and restricted manner.

Further, the Company

has learned through its initial animal studies that this targeted release of THC, which could be provided in very low doses to achieve

physiologically beneficial results, serves as an anti-inflammatory agent in the lower gastrointestinal tract and minimizes the amount

of THC absorbed into the blood stream, therefore avoiding the psychoactive and intoxicating properties that hinder the broader pharmaceutical

Company is developing THC-glycoside prodrugs for the treatment of gastrointestinal diseases, including inflammatory bowel disease (IBD)

and irritable bowel syndrome (IBS) because of the targeted release described previously.

IBD is a frequently chronic inflammatory condition

where parts of the digestive system become inflamed from an overactive immune response.

The disease can lead to irreversible damage to

the gastrointestinal tract and may require surgery to remove affected areas of the intestine.

Two major forms of the disease are Crohn’s

disease, which can affect any part of the digestive system, and ulcerative colitis, which often affects the colon or large intestine.

The disease is often unpredictable with periods of painful and debilitating symptoms followed by periods of remission with limited symptoms.

IBS has similar symptoms to IBD, including abdominal pain, but the underlying disease process is quite different.

IBS is a functional

gastrointestinal disorder that commonly affects the large intestine and is characterized by abdominal cramping, diarrhea, constipation,

Currently, patients suffering from IBD are frequently prescribed anti-inflammatory drugs such as steroids, biologics and immunosuppressants,

and patients suffering from IBS are prescribed antibiotics, antidepressants and gastrointestinal motility compounds, all of which often

result in unwanted side effects.

Company’s most promising THC-glycoside (VBX-100) is being developed as an oral prodrug for the treatment of IBD and IBS.

was selected from the Company’s THC-glycoside portfolio for compatibility with commercial production techniques and the optimal

prodrug delivery profile that maximizes intestinal anti-inflammatory properties while minimizing psychoactive or intoxicating effects.

Initial pre-clinical studies on the efficacy of VBX-100 in animal models have shown favorable outcomes, including reduced inflammation

of the gastrointestinal tract and no measurable systemic THC found in tissue examined using highly-sensitive testing equipment.

Company has determined that the value of its cannaboside prodrug assets would likely be maximized through a public capital raise into

the Company or a private capital raise into Graphium Biosciences to secure funding to advance VBX-100 through its

remaining pre-clinical animal studies and its Phase I and Phase II clinical trials.

Drug Designation

January 2018, the Company filed a request with the FDA’s Office of Orphan Products Development (OOPD) for an Orphan Drug Designation

of its VBX-100 prodrug for the treatment of pediatric ulcerative colitis.

In March 2018, the OOPD denied the Company’s request

based, in part, on the FDA’s decision to no longer grant Orphan Drug Designation status to drugs for pediatric subpopulations of

common diseases (i.e., diseases or conditions with an overall prevalence of over 200,000), unless the use of the drug in the pediatric

subpopulation meets the regulatory criteria for an orphan subset, or the disease in the pediatric subpopulation is considered a different

disease from the disease in the adult population.

December 2019, the Company’s received a letter from the OOPD informing it that the FDA determined that the Company may be eligible

for pediatric-subpopulation designation because the Company submitted its original request for an Orphan Drug Designation before the

guidance Clarification of Orphan Designation of Drugs and Biologics for Pediatric Subpopulations of Common Diseases was finalized

in July 2018.

in May 2020, the Company filed a response letter with the OOPD addressing the other deficiencies noted in the Company’s original

submission in January 2018, which included, among other things (1) support for the prevalence of pediatric ulcerative colitis;

Company’s scientific rationale for the specific animal models used in its pre-clinical animal studies;

and (3) more comprehensive

supporting documentation for the use of VBX-100 in pediatric patients with ulcerative colitis.

In August 2020, the Company received a

letter from the OOPD stating that it was unable to grant the Company’s request for an Orphan Drug Designation status because its

VBX-100 prodrug was administered before and after colitis was induced in its in vivo mouse studies, which resulted in the need

for more scientific data to support the efficacy of our VBX-100 prodrug in a treatment-only setting.

As a result, the Company was advised

to perform a second in vivo mouse study in which its VBX-100 prodrug would be administered only after colitis was induced in order

to provide a clear indication that the active drug was released only after ulcerative colitis was present.

In May 2021, the Company completed

the treatment-only in vivo mouse study and filed a supplemental response letter with the OOPD providing the requested in vivo

treatment-only mouse study results in support of its position that VBX-100 may be effective as a treatment for pediatric ulcerative

August 9, 2021, the Company received a letter from the OOPD stating that it has been granted Orphan Drug Designation for its glycosylated

product development or other initiatives by our competitors;

fluctuations in the availability and costs of raw materials required in our drug development process;

other factors beyond our control;

and the other risks described under the heading “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on March

we believe that the expectations and assumptions reflected in the forward-looking statements we make are reasonable, we cannot guarantee

future results, levels of activity or performance.

In addition, we cannot assess the impact of each factor on our business or the extent

to which any factor, or combination of factors, may cause actual results to differ materially from those expressed by any forward-looking

As a result, readers should not place undue reliance on any of the forward-looking statements we make in this report.

Forward-looking

statements speak only as of the date on which they are made.

Except as required by law, we undertake no obligation to revise or update

publicly any forward-looking statements for any reason.

otherwise provided in this Quarterly Report, references to the “Company,” “we,” “us”, and “our”

refer to Malachite Innovations, Inc., a Nevada corporation formed on June 29, 2007 as Legend Mining Inc., and its consolidated subsidiaries.

On October 10, 2011, we completed a merger with our wholly-owned subsidiary, Stevia First Corp., whereby we changed our name from “Legend

Mining Inc.” to “Stevia First Corp.” On July 15, 2016, our Board of Directors and shareholders approved a name change

to “Vitality Biopharma, Inc.” On October 1, 2021, we completed a merger with our wholly-owned subsidiary, Malachite Innovations,

Inc., whereby we changed our name from “Vitality Biopharma, Inc.” to “Malachite Innovations, Inc.”

Innovations, Inc.

(“Malachite”) is a public holding company dedicated to improving the health and wellness of people and

the planet through a novel and innovative approach to impact investing.

Malachite owns and operates a balanced portfolio of operating

businesses focused on developing long-term solutions to environmental, social and health challenges, with a particular focus on economically

disadvantaged communities.

Malachite takes an opportunistic approach to impact investing by leveraging its competitive advantages and

looking at solving old problems in new ways.

Malachite seeks to thoughtfully allocate its capital into ventures that are expected to

make a positive impact on the people-planet ecosystem and generate strong investment returns for our shareholders.

corporate headquarters is located in Cleveland, Ohio, with additional office locations in Rocklin, California and Fola, West Virginia.

As of March 30, 2023, we employed 40 full-time employees and engaged various consultants and professional service firms to provide us

with flexible and experienced resources to advance our corporate objectives while maintaining a cost-effective overhead structure.

strive to instill a corporate culture of honesty, integrity and respect while advancing our mission of doing well by doing good.

Business Segments

five operating business segments are:

(i) Environmental Services, (ii) Biochar Products and Solutions, (iii) Stream Mitigation Banking,

(iv) Environmental Security Services, and (v) Cannabinoid Drug Development.

The Stream Mitigation Banking segment did not have significant

operations in the three months ended March 31, 2023.

about our business segments should be read together with “Part II.

Management’s Discussion and Analysis of Financial

Condition and Results of Operations.”

Environmental

May 2022, the Company 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

Reclamation Entities”).

The Range Reclamation 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 Reclamation 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 Reclamation 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, sell water treatment

chemicals manufactured by third parties to their customers.

Range Natural also mines natural resources, including coal, for customers

incidental to the reclamation and repurposing of mine sites.

Energy Information Administration (“EIA”), the United States had 551 coal mines in 2020, comprised of 370 active

mines, 141 idled or closed mines, and 40 new or activated mines.

Approximately 82% of those coal mines were located in Appalachia (which

comprises the Appalachian Mountains and is commonly known as the cultural region in the Eastern United States stretching from the southern

part of New York to the northern parts of Alabama and Georgia).

According to the EIA, there were approximately three times as many coal

mines in the United States in 2008 (compared to 2020) with approximately 89% located in Appalachia.

The precipitous decline in the number

of operating coal mines since 2008 is due to various supply, demand and regulatory factors, including a reduction in demand for coal

as a source of electricity due to the increased use of natural gas and renewable energy, an increase in coal production costs due to

inflation and the dearth of cost-effective locations remaining for mining, and a more stringent and costly regulatory environment, all

of which have resulted in an increasingly difficult market for coal producers.

2000, coal was responsible for 1,966 billion kWh of electricity generation, which represented 52% of the total electricity generation

in the United States.

However, in 2022, coal was responsible for only 828 billion kWh of electricity generation, which represented 20%

of the total electricity generation in the United States.

According to the EIA, 23% of the 200,568 megawatts of coal-fired capacity currently

operating in the United States is scheduled to retire by the end of 2029 due to the high cost of operations, continued competition from

natural gas and renewable energy resources, and sustainable initiatives of energy producers.

the reclamation of closed and inactive mine sites has not kept pace with the increase in closed and idled mine sites, thus creating a

substantial backlog of reclamation work that needs to be completed on former mine sites.

According to the U.S.

Office of Surfacing Mining

Reclamation and Enforcement (“OSMRE”), there are approximately 50,000 high-priority abandoned mine land locations in the

United States resulting from legacy coal mining operations that failed to adequately reclaim the land and waterways back to their natural

Additionally, there are tens of thousands of active mine sites in the United States that require contemporaneous reclamation of

land and waterways during the active mining process, and an estimated equally large number of idled mine locations that also require

significant land reclamation and water restoration services.

the Surface Mining Control and Reclamation Act of 1977 (“SMRCA”), OSMRE was established for two basic purposes:

(i) to ensure

coal mines in the United States operate in a manner that protects citizens and the environment during mining operations and to restore

the land to beneficial use following mining, and (ii) to implement an Abandoned Mine Land (“AML”) reclamation program to

address the hazards and environmental degradation resulting from two centuries of coal mining activities that occurred before SMRCA was

passed in 1977.

The AML reclamation program is funded through fees levied against coal producers based on tons of coal produced.

September 2020, the AML reclamation fund had collected a total of $11.7 billion in coal mining fees over the life of the program, with

$9.5 billion (81%) appropriated and distributed in accordance with SMCRA, and $2.2 billion (19%) unappropriated and available for future

disbursement.

In November 2021, the Infrastructure Investment and Jobs Act was enacted, which, among other things, authorized $11.3 billion

in new funding to be appropriated for deposit into the AML reclamation fund.

Importantly, the AML reclamation fund is only available

to help fund the reclamation of mines abandoned before SMCRA was enacted in 1977;

therefore, all mines abandoned after the year 1977

cannot access funding from the AML reclamation fund and must obtain funding from other sources.

Additionally,

each state in Appalachia has a Department of Environmental Protection (“DEP”) or an equivalent agency that oversees coal

mining permitting, operations, and reclamation.

Under DEP rules and regulations, coal mining companies are required to develop a mining

and reclamation plan that is approved by the applicable state agency, obtain a mining permit from the state, and secure a reclamation

surety bond from a qualified third-party insurance company or provide a comparable financial guarantee.

The reclamation surety bond provides

the state with financial assurances that land reclamation and waterway restoration will be performed in accordance with the original

reclamation plan once mining is complete if the coal mining company, as primary obligor, fails to perform.

Therefore, there are at least

three groups who may need land reclamation, water restoration and environmental auditing services:

(i) mining companies when permits

are active and reclamation bonds are not in default, (ii) surety bond insurers when reclamation bonds are in default, and (iii) states

through their AML reclamation funds for mine lands abandoned before 1977 and for mine lands with defaulted coal mining companies and

surety bond insurers after 1977.

the time of acquisition in May 2022, the Range Reclamation Entities had one reclamation customer, 15 pieces of owned and financed

equipment, eight pieces of rented equipment, and 12 employees, all located and operating in West Virginia.

As of March 30, 2023,

less than one year later, the businesses had three reclamation customers, more than 40 pieces of owned and financed equipment, and

27 employees in West Virginia.

For the full year 2021, the Range Reclamation Entities had revenues of approximately $2.5 million.

For the partial year period from May 11, 2022 to December 31, 2022, the Range Reclamation Entities had revenues of approximately

$4.8 million.

For the first quarter of 2023, the Range Reclamation Entities had revenues of approximately $3.0 million.

Reclamation Entities have also made a significant investment in recruiting, retaining and rewarding employees, including providing

new benefits such as health insurance, paid time off, vacation days, 401K retirement plan, and job advancement training.

Reclamation Entities’ employees are their most valuable asset, and therefore we are committed to building a best-in-class

culture and financially rewarding our talented, hard-working employees so that we can maximize the good we can do for our people and

their families.

Range Reclamation Entities are planning for continued growth in their land reclamation, water restoration and consulting businesses by

expanding their market share with existing coal mining customers and reclamation bond insurers, adding new coal mining and non-coal mining

customers, and collaborating with the Company’s other operating businesses to generate incremental sales opportunities.

seek to add additional people, equipment and technologies to support these ambitious growth goals to ensure we successfully execute our

value creation plans for the Company and our shareholders.

Products and Solutions

Preta, Inc., an Ohio corporation (“Terra Preta”), is a biochar product development and environmental solutions business started

by the Company in December 2022.

Terra Preta is developing a novel and innovative combination of biochar, proprietary materials and structural

designs intended to create several first-of-its-kind agricultural and water filtration products and solutions.

is a solid, lightweight carbon-rich material produced by the thermal decomposition of organic material (such as cellulosic feedstock,

including wood and plants) using a chemical-conversion process known as pyrolysis.

Carbonization pyrolysis is a chemical degradation

process that heats organic materials to produce carbon-rich biochar, liquid bio-oils, and syngas products.

Since organic material is

thermally decomposed without oxygen during the pyrolysis process, combustion does not occur, so the process allows for the permanent

capture of carbon in the biochar end-product and eliminates the release of climate-damaging carbon dioxide into the atmosphere.

yield of biochar during the carbonization pyrolysis process depends on several variables such as temperature, heating time and heating

Lower temperatures, longer heating times and lower heating rates typically yield more biochar and less bio-oil and syngas.

Preta has been launched to build a full-cycle, carbon-negative business that reduces greenhouse gases from the atmosphere, passively

filters contaminated water without the use of harsh chemicals, and provides a fortified, nutrient-rich soil amendment to improve the

growth of agricultural products.

gases, comprised of carbon dioxide, methane, nitrous oxide and fluorinated gases, are gases that trap heat in the atmosphere, and are

generally believed to result in warmer temperatures and climate change, including changing weather patterns, rising sea levels, and more

extreme weather events.

Carbon dioxide enters the atmosphere through, among other things, the burning of fossil fuels, solid waste and

other biomass materials, and is removed from the atmosphere when absorbed by plants during the photosynthesis process.

Terra Preta is

in discussions with a large affiliated landowner to enter into a long-term lease or purchase of at least 100 acres of former mine land

in West Virginia for the planting, growth and harvesting of crops to serve as the primary feedstock for our biochar production operations.

The newly planted crops would then act as a “carbon sink”, drawing substantial amounts of carbon dioxide from the atmosphere

into the plants through the photosynthesis process.

When the plants are harvested, biochar is produced through the carbonization pyrolysis

process and the captured carbon dioxide is permanently preserved as carbon in the biochar product for use in water treatment and agricultural

to rules adopted under the Clean Water Act of 1972 (“Clean Water Act”), the U.S.

Environmental Protection Agency (“EPA”)

has implemented various pollution control programs such as wastewater standards for industry and recommendations for pollutants in surface

The Clean Water Act prohibits any party from discharging pollutants into a water of the United States unless they have a permit

issued under the National Pollutant Discharge Elimination System (“NPDES”), which contains limits on what a party can discharge

and establishes monitoring and reporting requirements.

On mining sites, coal operators are required to sample and test their water discharges

on a regular basis to ensure compliance with the Clean Water Act and applicable NPDES permits.

Currently, most mining operators treat

non-compliant water with temporary holding ponds and expensive chemicals such as pH adjusters, coagulants and flocculants that require

constant reapplication to ensure compliance.

Terra Preta will focus on developing a proprietary, biochar-based passive treatment system

that treats non-compliant mine site discharges to ensure compliance with the Clean Water Act and NPDES permits without the need for holding

ponds or expensive chemicals.

agriculture plays a critical role in the stability, growth, and diversification of our future food supply chain and the growth of plants

intended to serve as a carbon sink to reduce greenhouse gases.

High-quality soil, a key condition for sustainable agriculture, requires

organic matter, microorganisms, nutrients, and optimal compaction.

Subsoils with a sufficient number of air-filled pores have little

restriction to drainage and aeration, and typically are able to decompose and cycle organic matter and nutrients more efficiently.

Alternatively,

soil with poor aeration leads to the build-up of carbon dioxide, reduces the ability of plants to absorb water and nutrients, and leads

to increased plant stress and root disease.

To help address the ill effects of soil compaction, Terra Preta is developing a proprietary,

fortified biochar soil amendment that provides unique soil structuring characteristics that will allow plants to grow strong roots that

optimize the absorption of water and nutrients, thereby reducing root stress and disease.

December 2022, Terra Preta filed trademarks for biochar goods and services related to agricultural and water treatment applications.

In March 2023, Terra Preta filed provisional patents related to novel and innovative agricultural and water treatment solutions and designs.

Additionally, in March 2023, Terra Preta purchased two pyrolysis ovens that each produce one ton of biochar per day to advance our research

and development activities.

We anticipate that several biochar-based water filtration and soil amendment products will be available for

production and sale by the end of 2023.

Mitigation Banking

December 2022, the Company formed Pristine Stream Ventures, Inc., an Ohio corporation (“Pristine Stream”) to engage in the

business of establishing “mitigation banks” throughout the Appalachian region in order to restore and preserve environmentally

degraded streams and waterways and support new economic development, with a particular focus on coal mine sites in economically disadvantaged

areas that are being repositioned for next generation industries and job creation.

mitigation bank is a stream, wetland or other aquatic resource that has been restored or preserved for the purpose of providing compensation

for environmental impacts to other aquatic resources.

A mitigation bank is created to ensure that ecological loss resulting from new

development is offset by the restoration and preservation of other nearby natural habitats so there is no net loss to the environment.

Regulatory agencies determine the number of mitigation credits that a mitigation bank may earn and sell upon the completion of each specific

restoration project, and likewise, the number of mitigation credits that a developer is required to purchase to offset the environmental

impact of the new development project.

Section 404 of the Clean Water Act, a permit from the U.S.

Army Corps of Engineers (“Army Corps”) is required to begin a

new development that impacts a wetland, stream or other aquatic resource.

The Army Corps, following the guidance set forth by the EPA,

will grant a permit if the applicant:

(i) takes all practicable steps to avoid an adverse impact to a wetland, stream, or other aquatic

resource, (ii) minimizes unavoidable damage to a wetland, stream, or other aquatic resource, and (iii) compensates for permanent destruction

of a wetland, stream, or other aquatic resource by creating a new comparable aquatic resource, or by restoring a degraded one.

a wetland, stream or aquatic resource is permanently destroyed as part of a project, the developer must either restore or preserve a

new wetland, stream or aquatic resource, or purchase available credits from a qualified and approved mitigation bank that has already

restored or preserved a wetland, stream or aquatic resource in a qualifying hydrological unit code (“HUC”) zone.

States Geological Survey created HUC zones based on a hierarchical land area classification system incorporating surface hydrological

features in a standard, uniform graphical framework.

HUC zone requirements are used to ensure a restored waterway is proximally located

to an impacted waterway so that the no net-loss principle incorporates a geographic factor.

mitigation can be accomplished through three options approved by the Army Corps:

(i) the developer purchases appropriate credits from

an approved mitigation bank, (ii) the developer pays into an approved in-lieu fee fund, or (iii) the developer performs the requisite

amount of aquatic restoration.

The Army Corps determines, on a case-by-case basis, the appropriate compensation option and amount of

compensation mitigation required by a developer to off-set unavoidable adverse effects to the aquatic environment.

In determining the

amount of compensation mitigation, the Army Corps will consider the functional loss at the development site, the expected functional

gain at the mitigation site, the net loss of aquatic resource surface area, risk and uncertainty of the mitigation project, and loss

of natural habitat.

Stream is planning to establish mitigation banks throughout the Appalachian region to earn mitigation credits which Pristine Stream would

later sell to developers to allow them to offset the impact of development activities in similar geographical areas.

Pristine Stream

plans to identify and select qualifying aquatic sites, work closely with applicable federal and state regulatory agencies, and use the

Range Reclamation Entities to repair and restore damaged waterways to earn mitigation credits that can be sold by Pristine Stream.

Stream is currently analyzing the supply and demand dynamics of many HUC zones throughout the Appalachian region to determine the optimal

areas of focus for its new mitigation banks, and anticipates initiating its first mitigation banking project in Appalachia by the end

Environmental

Security Services

Security Resources, Inc., an Ohio corporation (“Range Security”), is an environmental security services business started

by the Company in November 2022.

Range Security is focused on providing eco-friendly, technology-driven security services to active and

former mine sites, with a particular focus on locations transitioning from coal mining to next generation industries.

Range Security

is intended to serve as a complementary business to the Range Reclamation Entities.

sites in the Appalachian region frequently comprise thousands of acres of natural habitat with valuable infrastructure and operating

assets disbursed across large tracts of land.

However, many of these mine sites lack adequate broadband access or cellular service, and

therefore traditional technology-based security solutions are not available.

Also, due to the large land areas and often challenging

access roads and mountainous terrain, consistent visual confirmation of the safety and security of high value assets is problematic,

and unnecessary amounts of carbon dioxide are emitted from heavy-duty trucks used to perform frequent visual security checks.

due to the remoteness and lack of technological options, most security services in the market fail to provide an independent verification

of the security status of a mine site and confirmation of visual security checks, resulting in a customer’s uncertainty regarding

the actual security services being provided.

assets commonly found on mine sites requiring high-levels of security services include office buildings, coal operation facilities such

as preparation plants and loadout facilities, power stations and electrical lines, vehicles and heavy equipment, supplies and chemicals,

and spare parts and components.

These high-value assets are frequently the target of theft since all or parts of these assets can be

easily removed from the mine site and sold for cash.

Unfortunately, the actual damage to the operation resulting from this type of destructive

theft is frequently many times the market value of the stolen item, primarily due to the losses resulting from the down-time of operations,

the cost of repairs and replacement components, and the long-term damage to critical infrastructure that can be repurposed and used to

attract next generation industries once the mining is complete.

March 2023, Range Security was engaged by its first customer for environmental security services covering a 13,000-acre coal mine site

in West Virginia.

Range Security has hired seven new security professionals, and is focusing its recruitment efforts on military veterans,

police officers, and other professionals with security experience.

Range Security has purchased two fuel-efficient utility task vehicles

for ground surveillance and a thermal-imaging drone for aerial surveillance, all of which use significantly less fuel and electricity

to operate than traditional security vehicles and provide a much broader coverage range with a substantially lower carbon footprint.

Range Security is also in the process of establishing satellite-based wireless service to support video surveillance and enable a mobile

technology solution used by our security professionals to provide real-time evidence of visual security checks.

Range Security plans

to expand its security service business onto several additional mine sites prior to the end of 2023, with a particular focus on locations

with valuable infrastructure being repurposed into non-coal multi-use complexes with attractive job growth prospects and next generation

industry opportunities.

Drug Development

Biosciences, Inc., a Nevada corporation (“Graphium”), is a cannabinoid-based drug development company tracing its history

of technological innovation and drug advancement back to October 2011 through two predecessor entities, Stevia First Corp.

Biopharma, Inc.

In October 2021, the Company formed Graphium as a wholly-owned subsidiary and transferred all of its drug development

assets to this newly-formed entity.

is advancing a broad portfolio of glycosylated cannabinoid prodrugs that have been developed to unlock the rebalancing effects of the

endocannabinoid system to address numerous chronic conditions with inadequate pharmaceutical options.

Graphium’s leading drug candidate,

VBX-100, is a glycosylated tetrahydrocannabinol (“THC”) cannabinoid that targets inflammatory conditions of the gastrointestinal

tract but without unwanted psychoactive or intoxicating side effects.

Cannabinoids,

including THC and cannabidiol (“CBD”), have well-known therapeutic benefits through their interaction with the human endocannabinoid

system, which serves a regulating and rebalancing function in the body.

For decades, patients have used cannabinoids to activate the

endocannabinoid system to provide relief for numerous chronic and debilitating ailments, including inflammation, pain, anxiety, depression,

However, THC, a commonly-used cannabinoid with significant therapeutic benefit, is psychoactive and intoxicating, and therefore

its use has many practical, and in some cases legal, limitations.

Nevertheless, many patients with chronic health conditions, including

gastrointestinal inflammation, continue to use cannabinoids because current pharmaceutical offerings do not provide adequate therapeutic

relief or result in unwanted side effects.

novel scientific discovery was the development of a proprietary enzymatic bioprocessing technology that adds one or more glucose molecules

to a cannabinoid, resulting in our proprietary glycosylated cannabinoid compounds.

Our glycosylated cannabinoids act as prodrugs that

achieve targeted delivery of the bioactive cannabinoids within the body once they are activated.

Prodrugs are compounds that, after administration,

are metabolized into a pharmacologically active drug and are often designed to improve drug properties and reduce known or expected toxicities

and adverse side effects.

The advantages of our glycosylated cannabinoid prodrugs may include:

(i) administration in a convenient oral

formulation, (ii) targeted delivery with release in the colon or large intestine, (iii) improved stability with limited degradation or

drug metabolism, and (iv) delayed release enabling longer-lasting effects and fewer administrations by patients.

have learned through our animal studies that glucose bound to cannabinoid molecules are inactive and poorly absorbed from the intestines,

allowing the combined molecule to reach the large intestine where glycoside hydrolase enzymes cleave the glucose and the cannabinoid

is released in a targeted and restricted manner.

Further, we have learned through our animal studies that a targeted release of THC,

which could be provided in very low doses to achieve physiologically beneficial results, serves as an anti-inflammatory agent in the

lower gastrointestinal tract and minimizes the amount of THC absorbed into the blood stream.

Therefore, we anticipate our glycosylated

cannabinoid prodrug will provide the anti-inflammatory benefits of low-dose THC while avoiding the psychoactive and intoxicating properties

that hinder the broader pharmaceutical use of THC.

Initially, we are targeting the $20 billion inflammatory bowel disease (“IBD”)

market in the United States, which is composed of patients suffering from ulcerative colitis and Crohn’s disease, both chronic

and debilitating conditions with no cure.

We also believe our glycosylated cannabinoids could also be used to treat other indications,

including, among others, irritable bowel syndrome (“IBS”), anxiety, depression, autism and cancer.

using our proprietary enzymatic bioprocessing technologies, our research team has developed a novel family of over 100 glycosylated cannabinoid

These glycosylated cannabinoids have unique commercial applications and patentable compositions of matter, which are separate

and distinct from ordinary cannabinoids.

Currently, our intellectual property is comprised of the following patents:

(i) Cannabinoid

Glycoside Prodrugs and Methods of Synthesis:

Patent filed in 2016 and granted in 2021 for the invention of novel glycosylated cannabinoids

and methods of targeted delivery for the treatment of gastrointestinal disorders, including IBD and IBS, (ii) Antimicrobial Compositions

Comprising Cannabinoids and Methods of Using the Same:

Patent filed in 2018 and granted in 2021 for the use of cannabinoids as antibiotics

for the treatment of Clostridioides difficile , (iii) Novel Cannabinoid Glycosides and Uses Thereof:

Patent filed in 2020 and in

prosecution for additional novel cannabinoid glycosides and includes research data supporting the improved characteristics and commercial

production strategies for these new molecules, and (iv) Continuous Enzymatic Perfusion Reactor System:

Patent filed in 2021 and in prosecution

for our improved reactor system for the efficient enzymatic glycosylation of hydrophobic small molecules, including cannabinoids.

believe our intellectual property portfolio of glycosylated cannabinoids possess significant value and, as a result, we have allocated

substantial resources to ensure that our U.S.

and international patents are properly filed and successfully prosecuted.

As our research

efforts involving glycosylated cannabinoids continue to progress, we plan to file additional patents to further expand our growing family

of intellectual property assets and create long-term value for our shareholders.

research team has performed 23 animal studies to test the safety, efficacy and dosing levels of our glycosylated cannabinoids, which

have provided us with favorable scientific data and the opportunity to further refine our drug development plan.

We have performed two

industry standard colitis disease mouse models:

(i) TNBS model in 2017 and 2018 that generated favorable colitis prevention data, and

(ii) DSS model in 2021 that generated favorable colitis treatment data.

In 2021, we received a letter from the Food and Drug Administration’s

(“FDA”) Office of Orphan Products Development stating that we have been granted Orphan Drug Designation for our glycosylated

cannabinoid VBX-100 for the treatment of pediatric ulcerative colitis.

The Company is currently evaluating several regulatory pathways

for the advancement of its VBX-100 prodrug through pre-clinical and clinical studies, including leveraging the benefits of the Orphan

Drug Designation granted by the OOPD.

Ecosciences is focused on creating shareholder value by addressing the health and wellness of the planet through an ESG-focused business

strategy, with a particular focus on deploying technological innovations and eco-friendly solutions to remedy difficult environmental

situations in economically challenged communities.

Company’s ESG business strategy is based on the foundational principle that sustainability and value creation are interconnected.

Rather than evaluating the merits of an opportunity based solely on the short-term direct profitability of a proposed business initiative,

sustainable business practice takes a holistic approach and considers the environmental, social and financial impacts of that initiative

on a wide range of stakeholders, including shareholders, the environment and local communities.

The Company believes that a strong ESG

proposition, properly capitalized, will help the Company expand into and create value in new environmentally-focused markets.

also believe that a robust ESG business model can enhance its investment returns by allocating capital to more promising and more sustainable

opportunities.

stronger external-value proposition may enable the Company to achieve greater strategic freedom.

Given that certain of the ESG business

initiatives under consideration may require governmental approvals or support, we believe that a focus on ESG core principles can ease

regulatory pressures and help reduce the Company’s risk of adverse government action.

The Company also believes that a strong ESG

proposition can help it attract and retain quality employees, enhance employee motivation by instilling a sense of purpose, and increase

productivity overall.

Company will require additional capital to successfully pursue its ESG business strategy.

While the Company believes there are an increasing

number of sources of financing available for ESG initiatives, there can be no assurance that the Company will successfully raise the

needed capital.

The Company believes that a commitment to ESG business principles will allow the Company to generate strong financial

returns for shareholders while also creating long-term environmental and social benefits.

the Company intends to focus its ESG business strategy on acquiring and developing businesses the Company believes have potential to

conserve, protect and re-purpose the natural environment in those areas in the U.S.

that have been negatively impacted by mining.

Company’s business development strategy will initially focus on the following areas:

treatment and remediation

footprint reduction

usage and conservation

and disposal practices

products, technologies, and infrastructure

with the U.S.

Environmental Protection Agency (EPA) and other environmental regulatory bodies

Company may also build, invest in or acquire companies that use blockchain, or distributed ledger technology, to account for and verify

voluntary-market carbon credits generated by increased usage of renewable resources or the decreased usage of non-renewable resources

to enable a more efficient and transparent global market for carbon credits.

This may include companies (i) developing innovative products

or solutions to reduce or mitigate carbon emissions;

(ii) developing technologies that drive blockchain registry of credits or tokens;

(iii) issuing tokens based on registry of carbon credits;

and (iv) developing exchange facilities for carbon credits.

Company believes that it is well-positioned from a managerial and operational perspective to pursue these business initiatives given

the experience of management in connection with other successful ventures that are developing and executing various reclamation and remediation

programs at coal mines in Appalachia and creating profitable next-generation eco-friendly initiatives and stable jobs in local communities

previously reliant primarily on the highly cyclical coal mining industry.

Environmental Resources and Range Natural Resources

May 2022, the Company, through its Daedalus Ecosciences

subsidiary, acquired 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.

The Range Entities’

land reclamation services seek to return 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, sell water treatment chemicals manufactured by third parties to its customers.

ESG Opportunities

Company is actively pursuing a number of other ESG-focused investment opportunities to advance its mission with a particular focus on

some of the most challenging environmental situations in disadvantaged communities.

An Orphan Drug Designation provides several benefits, including

fee waivers, tax credits, fast tracking of regulatory processes, and seven years of market exclusivity.

to our development of pharmaceutical products, we are subject to extensive regulation by the FDA and other federal, state, and local

Also, since we are researching and developing cannabinoid-based products, we are subject to regulation by the U.S.

Drug Enforcement

Administration (“DEA”).

Our research and development activities focus on cannabinoids, particularly THC and CBD derived from

the cannabis plant, which the DEA has classified as Schedule I substances.

Schedule I substances are defined as drugs with no currently

accepted medical use and a high potential for abuse.

In May 2019, the DEA informed us that it had determined that they consider our VBX-100

prodrug a Schedule I substance.

As a result, any developing, testing, manufacturing, or clinical studies involving our VBX-100 prodrug,

and by inference potentially all of our THC-glycoside molecules, are required to be properly licensed by the DEA and adhere to strict

diversion control standards.

are working closely with a third-party contract research organization to develop a detailed drug development plan to advance our leading

drug candidate, VBX-100, through Phase II clinical trials by the end of 2025, subject to receipt of sufficient funding, which is currently

estimated to be approximately $10.5 million.

If we are successful in advancing VBX-100 through Phase II clinical studies, then we would

seek to maximize shareholder value by either selling our drug development assets to a strategic purchaser or raising additional capital

to advance VBX-100 through Phase III clinical trials.

Investing Strategy

impact investing strategy aims to improve the health and wellness of people and the planet, while also generating long-term sustainable

financial returns for our shareholders.

We believe that doing well and doing good are not mutually exclusive, and that an impact investing

strategy can balance the environmental, social and economic needs of people and the planet while also generating attractive risk-adjusted

financial returns for shareholders.

impact investing strategy provides an opportunity for our dedicated team to address pressing environmental, social and economic challenges,

such as climate change, air and water pollution, educational inequality and economic disparity, through the development of technology-based

By actively directing investment capital towards businesses that are working to create positive environmental, social and

economic outcomes, our impact investing strategy can meaningfully contribute to an improved people-planet ecosystem and a healthier and

happier way of life.

have a particular interest in providing environmental and social solutions in economically-disadvantaged regions of the United States.

Initially, the Company is targeting the Appalachian region, which is home to communities with some of the most disadvantaged income,

education and employment demographics in the United States.

Our ambitious strategy is to allocate investment capital and build operating

businesses that provide positive environmental and social impact in the disadvantaged coal communities of Appalachia to maximize the

good we can do for people and the planet.

Investing Process

Company maintains a rigorous investment process comprised of sourcing, underwriting, acquiring or originating, growing, and exiting impact

investing opportunities.

Our executive management team is responsible for the construction, execution, and continued refinement of our

impact investing process, which relies upon the decades of experience of our executive management team and a periodic review, evaluation

and adoption of best practices employed in the direct investment and private equity industry.

impact investing process starts with identifying and evaluating potential investment opportunities.

We use a variety of sources to identify

potential impact investments, including our extensive network of industry contacts, third party intermediaries and proprietary research

performed by our executive management team.

Each potential impact investment is evaluated based on its fit with our corporate strategy,

the individual risks and opportunities of each potential investment, and any synergies with our other impact investments (“Portfolio

This detailed due diligence review is aimed at identifying and addressing material investment risks and opportunities

to create long-term sustainable value for our shareholders.

Furthermore, our evaluation of each potential impact investment incorporates,

to the extent appropriate, consideration of environmental, social and governance (“ESG”) and diversity, equity and inclusion

(“DEI”) factors in the investment decision-making process.

impact investments are commonly structured as stock or asset acquisitions with transaction consideration in the form of cash and the

Company’s common stock so the former owners of impact investment acquisitions are properly aligned with our public shareholders

in the creation of future value.

Additionally, the Company has developed innovative business projects that fit within our corporate strategy

and have been allocated capital and resources to grow and increase shareholder value.

Each such organic innovation has been developed

within a newly-created, wholly-owned Portfolio Company (e.g., Terra Preta, Pristine Stream and Range Security) so the executive management

team can properly monitor the performance of each organic innovation and optimize the allocation of capital and management resources

to maximize the positive overall impact to the Company and its shareholders.

a potential impact investment is acquired, or an organic innovation is launched, our executive management team is responsible for closely

monitoring on a regular basis the performance of each investment.

Each Portfolio Company has an experienced management team that is responsible

for executing a value creation plan with active support, collaboration and input from the Company’s executive management team.

Our complementary hybrid approach to investment management enables the management teams of each Portfolio Company to manage the daily

operations of the business in a decentralized manner, while the executive management team of the Company serves as an active collaborator

to the management team of each Portfolio Company to ensure the value creation plan is being successfully executed and cross-pollination

of ideas, capabilities and synergies are achieved across each Portfolio Company.

We believe a balanced approach to individual management

and corporate governance provides Portfolio Company management teams with the freedom and autonomy to preserve their ownership mindset

while also providing the Company’s executive team with the optimal level of involvement in order to maximize the overall benefits

to the Company’s shareholders.

the value creation plan is executed for each Portfolio Company, the Company’s executive team, in consultation with the management

team of each Portfolio Company, will regularly evaluate the strategic options for the business, which could include additional investment

to fund strategic growth and expansion, maximizing current cash flow without further investments, or a potential exit to a strategic

or financial buyer.

This process of evaluating strategic options is dynamic and involves many considerations, including an evaluation

of the current and future market conditions, the Portfolio Company’s current and future financial performance, changes in the Portfolio

Company’s competitive advantages, macro and micro market conditions, and exit valuations.

Since the Company is structured as a

perpetual investment vehicle without predetermined hold periods, our executive management team possesses the flexibility to regularly

evaluate the risk-return profile of each Portfolio Company and make strategic decisions that maximize the investment returns and value

creation for the Company’s shareholders.

and Operation

Company is organized as a public holding company.

Currently, all Portfolio Companies are wholly-owned subsidiaries of the Company and

are consolidated in our financial reporting.

Company’s executive management team works closely with the management team of each Portfolio Company on strategy, operations and

financial matters.

The Company allocates the time and resources of several executives to support the operations of Portfolio Companies,

including accounting, insurance and human resources, to recognize operational efficiencies and cost savings resulting from the Company’s

larger scale.

Environmental,

Social and Governance

principles are central to our mission of improving the health and wellness of people and the planet.

Our impact investing strategy is

dedicated to pursuing opportunities that improve the long-term sustainability of our people-planet ecosystem, reverse the damaging effects

of climate change, and revitalize disadvantaged communities into next generation cities.

We believe that considering ESG principles,

along with the profit potential of an investment, enables our team to take a broader, more holistic approach to capital deployment by

considering a wide range of stakeholders, including shareholders, the environment and local communities.

believe our genuine commitment to ESG principles, which is at the heart of our impact investing strategy, truly differentiates our Company

from other businesses whose dedication to ESG principles is more peripheral.

We believe our strong commitment to ESG principles will

allow us to attract similarly-committed customers, suppliers, employees, financial partners, and federal, state and local partnerships

who are motivated by our shared sense of purpose and commitment to doing well by doing good.

Equity and Inclusion

employees are integral to fostering a culture of honesty, integrity and respect.

We believe hiring, training, motivating and retaining

talented individuals is critical to the successful execution of our impact investing strategy.

Our employees are our single most important

seek to attract employees with different backgrounds and unique perspectives, and provide a safe environment for them to collaborate

in a respectful manner so our Company can benefit from their best collective thinking.

We believe a diverse, equitable and inclusive

workforce increases innovation and creativity, improves decision making, increases adaptability and flexibility, and improves stakeholder

Additionally, we believe these benefits will ultimately result in greater profits and an increase in long-term shareholder

Company is focused on a large and growing marketplace for impact investing and ESG business initiatives, and therefore, is anticipated

to face competition from a variety of operating businesses and investment funds who are developing business plans and operating strategies

to satisfy the increasing demands of these types of investments in the marketplace.

In almost all cases, these competitors are larger

and better capitalized operating businesses and investment funds.

Company competes on the basis of a number of factors, including access to capital, access to impact investing opportunities, recruitment

and retention of key personnel, market share with key customers, and supply relationships with critical vendors.

Our ability to continue

to compete effectively in our businesses will depend upon our ability to attract new employees and retain and motivate our existing employees.

inception, the Company and its subsidiaries have used QuickBooks as its general ledger accounting software.

However, given the significant

current and anticipated growth of its Portfolio Companies and the need for more robust information for management analysis and decision-making,

the Company has decided to transition all of its accounting software services from QuickBooks to Foundation Software.

Software, founded in Cleveland, Ohio in 1985, is specifically designed for service companies, particularly those in the construction,

contracting and reclamation industries.

Foundation Software offers the Company several enhanced features critical to the successful execution

of its value creation plan, including (i) general ledger accounting, including accounts payable, accounts receivable, inventory and customer

billing, (ii) equipment tracking on job sites, maintenance, utilization and depreciation, (iii) employee tracking on job sites, time

and materials, utilization, and billing, (iv) job costing and profitability reporting segmented by customers, job types and location,

and (v) numerous real-time management dashboard and key performance indicator reports that will allow management to closely monitor the

performance of each Portfolio Company and quickly react to business opportunities and issues.

Furthermore, Foundation Software will allow

the Company and its Portfolio Companies to quickly scale operations and efficiently and cost-effectively support the anticipated growth

of each business, thereby preventing our accounting and management systems from becoming a limiting factor to our growth initiatives.

Company has officially engaged Foundation Software as its new accounting software provider and is in the process of converting all of

the Company accounting system operations from QuickBooks to Foundation Software, which is expected to be completed during the second

quarter of 2023.

of Operations

Months Ended September 30, 2022 and September 30, 2021

Company’s net loss during the three months ended September 30, 2022 was $119,616 compared to a net loss of $504,358 for the three

months ended September 30, 2021.

The Company’s revenue during the three months ended September 30, 2022 was $1,547,258 and its

gross profit was $357,783.

The Company had no revenue during the three months ended September 30, 2021.

the three months ended September 30, 2022, the Company incurred general and administrative expenses in the aggregate amount of $449,041,

compared to $436,523 incurred during the three months ended September 30, 2021 (an increase of $12,518).

General and administrative expenses

generally include corporate overhead, salaries and other compensation costs, financial and administrative contracted services, marketing,

consulting costs and travel expenses.

The majority of the increase in general and administrative costs relates to health insurance costs

in the ESG Operations segment of $44,955 that were not incurred in the 2021 period.

These costs were offset by a decrease in professional

fees in the 2022 period.

The Company incurred professional fees of $3,550 during the three months ended September 30, 2022, as compared

to $52,500 during the three months ended September 30, 2021 (a decrease of $48,950).

addition, during the three months ended September 30, 2022, the Company incurred research and development costs of $106,744, compared

to $67,838 during the three months ended September 30, 2021 (an increase of $38,906).

This increase resulted from an increase in wages

allocated to the Therapeutic Operations segment, which increased to $83,479 in the period ended September 30, 2022, as compared to $48,443

in the period ended September 30, 2021 (an increase of $35,036).

the three months ended September 30, 2022, the Company recorded total net other income in the amount of $78,386, compared to total net

other income recorded during the three months ended September 30, 2021, in the amount of $3.

This difference was attributable to a gain

of $109,435 related to the forgiveness of the Company’s ESG Operations segment’s PPP loan offset by interest expense of $31,049

incurred during the three months ended September 30, 2022.

No amounts were recorded related to these items during the three months ended

September 30, 2021.

the three months ended September 30, 2022, the Company had a net loss of $119,616 compared to a net loss of $504,358 during the three

months ended September 30, 2021.

The decrease in net loss attributable to common stockholders of $384,742 is primarily due to the gross

profit of $357,783 earned during the three months ended September 30, 2022, compared to gross profit of $0 earned during the three months

ended September 30, 2021.

Months Ended September 30, 2022 and September 30, 2021

Company’s net loss during the nine months ended September 30, 2022 was $1,010,776 compared to a net loss of $1,477,224 for the

nine months ended September 30, 2021.

The Company’s revenue during the nine months ended September 30, 2022 was $2,186,617 and

its gross profit was $422,735.

The Company had no revenue or gross profit during the nine months ended September 30, 2021.

the nine months ended September 30, 2022, the Company incurred general and administrative expenses in the aggregate amount of $1,147,308,

compared to $1,538,158 incurred during the nine months ended September 30, 2021 (a decrease of $390,850).

The majority of the decrease

in general and administrative costs relates to stock-based compensation which decreased to $0 during the nine months ended September

30, 2022, as compared to $130,516 during the nine months ended September 30, 2021, professional fees which decreased to $16,090 during

the nine months ended September 30, 2022, as compared to $197,500 during the nine months ended September 30, 2021 (a decrease of $181,410),

and legal fees, which decreased to $93,770 during the nine months ended September 30, 2022, as compared to $303,474 during the nine months

ended September 30, 2021 (a decrease of $209,704).

addition, during the nine months ended September 30, 2022, the Company incurred research and development costs of $340,297, compared

to $236,287 during the nine months ended September 30, 2021 (an increase of $104,010).

This increase resulted from an increase in wages

related to research and development, which increased to $251,316 in the period ended September 30, 2022, as compared to $145,803 in the

period ended September 30, 2021 (an increase of $105,513), and legal fees, which increased to $51,871 during the nine months ended September

30, 2022, from $0 during the nine months ended September 30, 2021.

These costs were offset by a decrease in stock-based compensation

which decreased to $0 during the nine months ended September 30, 2022, as compared to $28,333 during the nine months ended September

the nine months ended September 30, 2022, the Company recorded total net other income in the amount of $54,094, compared to total net

other income of $297,221 recorded during the nine months ended September 30, 2021.

This difference was primarily attributable to the

gain on extinguishment of liabilities of $296,653 recorded during the nine months ended September 30, 2021, compared to a gain of $109,435

related to the forgiveness of the Company’s ESG Operations segment’s PPP loan, offset by interest expense of $55,341 incurred

during the nine months ended September 30, 2022.

the nine months ended September 30, 2022, the Company had a net loss of $1,010,776 compared to a net loss of $1,477,224 during the nine

months ended September 30, 2021.

The decrease in net loss attributable to common stockholders of $466,448 is primarily due to the gross

profit of $422,735 earned during the nine months ended September 30, 2022, compared to gross profit of $0 earned during the nine months

ended September 30, 2021.

Months Ended March 31, 2023 and March 31, 2022

The Company’s revenue

during the three months ended March 31, 2023 was $3,014,887 and its gross profit was $649,002.

The Company had no revenue or gross

profit during the three months ended March 31, 2022 as all of the Company’s revenue was generated by the Range Reclamation

Entities acquired in May 2022 and Range Security, which began operating during the first quarter of 2023.

Our net loss during the

three months ended March 31, 2023 was $226,860 compared to a net loss of $447,974 for the three months ended March 31, 2022 (a

decrease of $221,114).

the three months ended March 31, 2023, we incurred general and administrative expenses in the aggregate amount of $726,048, compared

to $317,941 incurred during the three months ended March 31, 2022 (an increase of $408,107).

General and administrative expenses generally

include corporate overhead, salaries and other compensation costs, financial and administrative contracted services, marketing, consulting

costs and travel expenses.

The largest increase related to the general and administrative expenses incurred by our Environmental

Services segment of $409,485 during the three months ended March 31, 2023.

addition, during the three months ended March 31, 2023, we incurred research and development costs of $106,177, compared to $125,730

during the three months ended March 31, 2022 (a decrease of $19,553).

This decrease resulted from a decrease in legal fees, which decreased

to $11,291 during the three months ended March 31, 2023, from $31,617 during the three months ended March 31, 2022.

During the three months ended

March 31, 2023, we recorded total net other expense in the amount of $43,637, compared to total net other expense of $4,303 recorded during

the three months ended March 31, 2022 (an increase of $39,334).

All of this difference was attributable to higher interest expense during

the three months ended March 31, 2023.

and Capital Resources

Company has incurred losses since inception resulting in an accumulated deficit of $50,151,454 as of September 30, 2022.

of September 30, 2022, the Company had total current assets of $1,654,684, comprised primarily of cash in the amount of $1,156,799, and

accounts receivable and other receivables of $497,001.

The Company’s total current liabilities as of September 30, 2022 were $721,085,

consisting of the current portion of long-term debt in the amount of $396,939, and accounts payable of $324,146, which includes a $33,440

lease payment attributable to the Company’s now-dissolved wholly-owned subsidiary, The Control Center, Inc., for which it is not

As a result, on September 30, 2022, the Company had working capital of $933,599.

of September 30, 2022, the Company had long-term assets of $2,552,967, which were comprised of net equipment assets of $1,683,406, goodwill

of $751,421, operating lease asset of $109,248, and deposits of $8,892.

As of September 30, 2022, the Company had long-term liabilities

of $878,983, which were comprised of long-term debt, net of current portion of $769,735, and operating lease liability of $109,248.

on the Company’s current corporate strategy, its total expenditures for the 12 months following September 30, 2022 are expected

to be approximately $1,800,000, which is comprised of general operating and research and development expenses.

Based on the Company’s

cash balance of $1,156,799, $1,000,000 available under its revolving credit line as of September 30, 2022, $4,830,050 available under

its equity financing line, revenues being generated by the Range Entities, and its estimated total expenditures of approximately $1,800,000

for the 12-month period ending September 30, 2023, the Company expects to have sufficient funds to operate its business over the next

The Company expects to generate funds from its ESG Operations, but may also seek additional financing and other sources of

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

Company’s estimated total expenditures for the 12-month period ending September 30, 2023 could increase if the Company encounters

unanticipated expenses in connection with operating its business as presently planned.

In addition, the Company’s estimates of

the amount of cash necessary to fund its business may prove to be too low, and the Company could spend its available financial resources

much faster than it currently expects.

If the Company cannot raise the capital necessary to continue to develop its business, the Company

will be forced to delay, scale back or eliminate some or all of its proposed operations.

If any of these were to occur, there is a substantial

risk that the Company’s business would fail.

inception, the Company has primarily funded its operations through equity and debt financings.

The Company has revenue earned from its

investment in the Range Entities that it expects will fund its ongoing operations and provide excess cash to fund all or a portion

of additional ESG investments made by Daedalus in the future.

The Company may also supplement its funding through equity and debt financings

in the future.

However, sources of additional funds may not be available when needed, on acceptable terms, or at all.

If the Company

issues equity or convertible debt securities to raise additional funds or to fund, in whole

or in part, acquisitions in furtherance of its business strategy, the Company’s existing stockholders may experience substantial

dilution, and the new equity or debt securities may have rights, preferences and privileges senior to those of its existing stockholders.

If the Company incurs additional debt, it may increase the Company’s leverage relative to its earnings or to its equity capitalization,

requiring the Company to pay additional interest expenses.

Obtaining commercial loans, assuming those loans would be available, would

increase the Company’s liabilities and future cash commitments.

If the Company pursues capital through alternative sources, such

as collaborations or other similar arrangements, the Company may be forced to relinquish rights to its proprietary glycosylated cannabinoid

technology or other intellectual property and could result in its receipt of only a portion of any revenue that may be generated from

a partnered product or business.

Moreover, regardless of the manner in which the Company seeks to raise capital, it may incur substantial

costs in those pursuits, including investment banking fees, legal fees, accounting fees, printing and distribution expenses and other

related costs.

have incurred losses since inception resulting in an accumulated deficit of $50,439,714.

As of March 31, 2023, we had total

current assets of $1,463,434, primarily comprised of cash in the amount of $229,018 and accounts receivable of $1,233,532.

31, 2023 we had total current liabilities of $2,159,789, consisting of accounts payable of $1,034,427 and the current portion of long-term

debt in the amount of $1,025,362.

As a result, on March 31, 2023, the Company had negative working capital of $(696,355).

31, 2022, the Company had negative working capital of $(128,371).

of March 31, 2023, the Company had long-term assets of $7,197,869, comprised of net equipment assets of $6,437,556, goodwill of $751,421,

and deposits of $8,892.

As of March 31, 2023, the Company had long-term liabilities of $3,788,931, comprised of long-term debt, net of

current portion.

As of December 31, 2022, the Company had long-term assets of $6,805,827, comprised of net equipment assets of $6,045,514,

goodwill of $751,421, and deposits of $8,892.

As of December 31, 2022, the Company had long-term liabilities of $3,738,013, comprised

of long-term debt, net of current portion.

Based on the Company’s current

corporate strategy, its net operating losses for the 12 months following March 31, 2023 are expected to be approximately $1,000,000, which

is comprised of general operating and research and development expenses which we expect to be partially offset by revenue generated by

the Range Reclamation Entities and Range Security.

Based on the Company’s cash balance of $229,018, $900,000 available

under its revolving credit line, and its estimated net operating losses of approximately $1,000,000 for the 12-month period ending March

31, 2024, the Company expects to have sufficient funds to operate its business over the next 12 months.

The Company expects to generate

positive cash flow from its operating businesses, other than its Cannabinoid Drug Development business, but may also seek additional financing

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

estimated total expenditures for the 12-month period ending March 31, 2024 could increase if we encounter unanticipated expenses in connection

with operating our business as presently planned.

In addition, our estimates of the amount of cash necessary to fund our business may

prove to be too low, and we could spend our available financial resources much faster than we currently expect.

If we cannot raise the

capital necessary to continue to develop our business, we will be forced to delay, scale back or eliminate some or all of our proposed

If any of these were to occur, there is a substantial risk that our business would fail.

inception, we have primarily funded our operations through equity and debt financings.

Until such time as our operating businesses are

cash flow positive, we expect to continue funding our operations, at least in part, through equity and debt financings.

However, sources

of additional funds may not be available when needed, on acceptable terms, or at all.

If we issue equity or convertible debt securities

to raise additional funds or to fund, in whole or in part, acquisitions in furtherance of our business strategy, our existing stockholders

may experience substantial dilution, and the new equity or debt securities may have rights, preferences and privileges senior to those

of our existing stockholders.

If we incur additional debt, it may increase our leverage relative to our earnings or to our equity capitalization,

requiring us to pay additional interest expenses.

Obtaining commercial loans, assuming those loans would be available, would increase

our liabilities and future cash commitments.

If we pursue capital through alternative sources, such as collaborations or other similar

arrangements, we may be forced to relinquish rights to our proprietary glycosylated cannabinoid technology or other intellectual property

which, in turn, could result in our receipt of only a portion of any revenue that may be generated from a partnered product or business.

Moreover, regardless of the manner in which we seek to raise capital, we may incur substantial costs in those pursuits, including investment

banking fees, legal fees, accounting fees, printing and distribution expenses and other related costs.

Cash Used in Operating Activities

Company has not historically generated positive cash flows from operating activities.

For the nine months ended September 30, 2022, net

cash used in operating activities was $568,536 compared to net cash used in operating activities of $1,503,046 for the nine months ended

September 30, 2021.

This decrease was primarily attributable to a lower net loss of $1,010,776 for the nine months ended September 30,

2022, compared to a net loss of $1,477,224 for the nine months ended September 30, 2021, as well as a gain on extinguishment of liabilities

of $296,653 recognized during the nine months ended September 30, 2021, and a decrease in accounts receivable of $554,181 during the

nine months ended September 30, 2022, partially offset by a decrease in the expenses recorded for stock-based compensation related to

stock options of $158,849 during the nine months ended September 30, 2021.

Net cash used in operating activities during the nine months

ended September 30, 2022, consisted primarily of a net loss of $1,010,776 and an increase of unbilled receivables of $161,263, offset

by a decrease in accounts receivable of $554,181.

Net cash used in operating activities during the nine months ended September 30, 2021,

consisted primarily of a net loss of $1,477,224, and a gain on extinguishment of liabilities of $296,653, partially offset by $158,849

related to stock-based compensation.

the three months ended March 31, 2023, net cash generated by operating activities was $675,796 compared to net cash used in

operating activities of $394,181 for the three months ended March 31, 2022.

This increase of $1,069,977 was primarily attributable

to a lower net loss of $226,860 during the three months ended March 31, 2023, compared to a net loss of $447,974 during the three

months ended March 31, 2022, as well as an increase in accounts payable of $800,619 during the three months ended March 31, 2023,

compared to an increase in accounts payable of $50,993 during the three months ended March 31, 2022, as well as depreciation expense

of $354,184 during the three months ended March 31, 2023, compared to $0 during the three months ended March 31, 2022.

provided by operating activities during the three months ended March 31, 2023 consisted of a net loss of $226,860 and an increase in

accounts receivable of $252,147, offset by an increase in accounts payable of $800,619 and depreciation expense of $354,184.

cash used in operating activities during the three months ended March 31, 2022 consisted primarily of a net loss of $447,974, offset

by an increase in accounts payable of $50,993.

Cash Used in Investing Activities

the nine months ended September 30, 2022, net cash used in investing activities was $1,977,502.

Net cash used in investing activities

during the nine months ended September 30, 2022, consisted primarily of equipment purchases totaling $1,243,329 and cash paid for the

acquisition of Range Environmental of $750,000.

No net cash was used in or provided by investing activities during the nine months ended

September 30, 2021.

the three months ended March 31, 2023, net cash used in investing activities was $746,226, which consisted of equipment purchased by

the Range Reclamation Entities, Terra Preta and Range Security.

No net cash was used in or provided by investing activities during the three months ended March 31, 2022.

Cash Provided By Financing Activities

the nine months ended September 30, 2022, net cash provided by financing activities was $3,664,494, compared to net cash provided from

financing activities of $119,000 during the nine months ended September 30, 2021.

Net cash provided by financing activities for the nine

months ended September 30, 2022 consisted of $3,250,000 received from the issuance of common stock and warrants, proceeds of $923,309

from long-term debt, offset by the payoff of the SBA Disaster Loan of $158,815 and the payoff of the revolving line of credit of $350,000.

The cash provided during the nine months ended September 30, 2021 was a result of the issuance of common stock and warrants under an

the three months ended March 31, 2023, net cash used in financing activities

was $142,921, compared to net cash provided from financing activities of $400,000 during the three months ended March 31, 2022.

used in financing activities for the three months ended March 31, 2023 consisted of proceeds of $383,202 from long-term debt, and proceeds

of $100,000 from a revolving credit line, offset by the repayment of long-term debt of $626,123.

The cash provided during the three months

ended March 31, 2022 was a result of proceeds of $400,000 from a revolving credit line.

Sheet Arrangements

Company has no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on its

financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or

capital resources that would be material to stockholders.

have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial

condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources

that would be material to stockholders.

Accounting Policies

Company’s financial statements and accompanying notes included in this report have been prepared in accordance with United States

generally accepted accounting principles (“U.S.

financial statements and accompanying notes included in this report have been prepared in accordance with United States generally accepted

accounting principles (“U.S.

GAAP”) applied on a consistent basis.

The preparation of financial statements

in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities

and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues

and expenses during the reporting periods.

Company regularly evaluates the accounting policies and estimates that it uses to prepare its financial statements.

The preparation of financial statements in conformity

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the

disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses

during the reporting periods.

regularly evaluate the accounting policies and estimates that we use to prepare our financial statements.

In general, management’s

2 unchanged sentences

Actual results could differ from the estimates made by management.

Company believes the following critical accounting policies require it to make significant judgments and estimates in the preparation

of its consolidated financial statements included in this report:

believe the following critical accounting policies require us to make significant judgments and estimates in the preparation of our consolidated

financial statements included in this report:

of Estimates and Assumptions

8 unchanged sentences

could differ from those estimates.

combinations are accounted for using the purchase method of accounting under ASC 805, “Business Combinations.” This method

requires the Company to record assets and liabilities of the businesses acquired at their estimated fair values as of the acquisition

Any excess of the cost of the acquisition over the fair value of the net assets acquired is recorded as goodwill.

Determining the

fair value requires management to make estimates and assumptions including discount rates, rates of return on assets, and long-term sales

growth rates.

referenced by ASC 350 “Intangibles- Goodwill and other” (“ASC 350”), management performs its annual test for

goodwill at least annually or more frequently, if impairment indicators arise.

The Company recognizes revenue

under ASC 606, “Revenue from Contracts with Customers”.

The core principle of the revenue standard is that a company should

recognize revenue by analyzing the following five steps:

(1) identify the contract with the customer;

(2) identify the performance obligations

in the contract;

(3) determine the transaction price;

(4) allocate the transaction price to the performance obligations;

and (5) recognize

revenue when (or as) each performance obligation is satisfied.

The Company primarily invoices customers and recognizes revenue on a periodic

basis for equipment and labor hours provided to a customer on a particular job based on an agreed-upon hourly rate sheet or a fixed amount

for a project.

The Company also invoices customers and recognizes revenue for equipment mobilization fees and materials and supplies required

to complete a project.

The Company invoices for the sales of chemicals and recognizes revenue when the products are delivered to the customer’s

designated site.

Costs for equipment, labor and chemicals are generally expensed as incurred since the projects are generally short-term

and not subject to a contract.

The Company also invoices customers for the provision of environmental security services on an agreed-upon

hourly rate for each project.

All revenue is recognized at a point in time.

Company periodically issues stock options and restricted stock awards to employees and non-employees in non-capital raising transactions

for services and for financing costs.

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.

Company’s revenue recognition policies will follow the guidance of FASB ASC 606 “ Revenue from Contracts with Customers .”

FASB ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes

(1) identifying the contracts or agreements with a customer, (2) identifying its performance obligations in the contract or agreement,

(3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing

revenue as each performance obligation is satisfied.

Range Entities primarily invoice customers and recognize revenue on a periodic basis for equipment and labor hours provided to a customer

on a particular job based on an agreed-upon hourly rate sheet or a fixed amount for a project.

The Range Entities also invoice customers

and recognize revenue for equipment mobilization fees and materials and supplies required to complete a project.

The Range Entities invoice

for the sales of chemicals and recognize revenue when the products are delivered to the customer’s designated site.

Costs for equipment,

labor and chemicals are generally expensed as incurred since the projects are generally short-term and not subject to a contract.

Range Entities’ performance obligations are satisfied at the point in time when the services are performed or when products are

received by the customer, which is when the customer has title and the significant risks and rewards of ownership.

The Range Entities

do not have any significant financing components as payment is received within a commercially reasonable time after the point of sale.

Costs incurred to obtain a contract will be expensed as incurred when the amortization period is less than a year.

Shipping and handling

amounts paid by the customers are included in revenue.

modifications are routine in the performance of the Range Entities’ contracts.

Contracts are often modified to account for changes

in contract specifications or requirements.

In most instances, contract modifications are a result of changes in the scope of work, or

the products or services required to complete the contract and are customarily approved in advance by the customer.

The Company accounts for such grants issued and vesting based on 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.

Accounting Pronouncements

2 unchanged sentences

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 2. Management’s Discussion and Analysis