What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-09-08 compared with 2022-08-01 · 1069 added, 205 removed, 34 unchanged (97% of the section changed)

(a) Business Development

The Company was originally incorporated

on June 30, 2021 in the State of Nevada with the name, “Prime Time Holdings, Inc.”

30, 2021, Jeffrey DeNunzio was appointed Chief Executive Officer, Chief Financial Officer, President, Secretary, Treasurer, and Director

of the Company.

On September 14, 2021, the Company entered into

an “Agreement and Plan of Merger”, whereas it agreed to, and subsequently participated in, a Nevada holding company reorganization

pursuant to NRS 92A.180, NRS 92A.200, NRS 92A.230 and NRS 92A.250 (“Reorganization”).

The constituent corporations in the

Reorganization were China Shouguan Investment Holding Group Corp.

(“CHSO” or “Predecessor”), Sparx Holdings Group,

Inc., FKA “Prime Time Holdings, Inc.” (“Successor”), and Prime Time Merger Sub, Inc.

Corporate History

The Company was originally incorporated on June 30, 2021, in the State

of Nevada with the name, “Prime Time Holdings, Inc.”

On June 30, 2021, our current director, Jeffrey

DeNunzio, was appointed Chief Executive Officer, Chief Financial Officer, President, Secretary, Treasurer, and Director of the Company.

On September 14, 2021, the Company entered

into an “Agreement and Plan of Merger”, whereas it agreed to, and subsequently participated in, a Nevada holding company

reorganization pursuant to NRS 92A.180, NRS 92A.200, NRS 92A.230 and NRS 92A.250 (“Reorganization”).

The constituent

corporations in the Reorganization were China Shouguan Investment Holding Group Corp.

“Predecessor”), Sparx Holdings Group, Inc., FKA “Prime Time Holdings, Inc.” (“PRTM” or

“Successor”), and Prime Time Merger Sub, Inc.

(“Merger Sub”).

Our director is, and was, the sole director/officer of each constituent corporation in the Reorganization.

Prime Time Holdings, Inc.

issued 1,000 common

shares of its common stock to Predecessor and Merger Sub issued 1,000 shares of its common stock to Prime Time Holdings, Inc.

prior to the Reorganization.

Our director, Jeffrey DeNunzio, is and was,

the sole director/officer of each constituent corporation in the Reorganization.

Immediately prior to the Reorganization, Prime

Time Holdings, Inc.

issued 1,000 common shares of its common stock to Predecessor and Merger Sub issued 1,000 shares of its common stock

to Prime Time Holdings, Inc.

As such, immediately prior to the merger, Prime Time Holdings, Inc.

became a wholly owned direct subsidiary

of China Shouguan Investment Holding Group Corp and Merger Sub became a wholly owned and direct subsidiary of Prime Time Holdings, Inc.

of China Shouguan Investment Holding Group Corp.

and Merger Sub became a wholly owned and direct subsidiary of Prime Time Holdings, Inc.

Pursuant to the above, on September 15, 2021,

8 unchanged sentences

common stock.

The result of the merger was that each former shareholder of Predecessor each became a shareholder of PRTM holding an equivalent

amount of shares in PRTM that they previously held in CHSO prior to the merger.

The Agreement and Plan of merger were made a part of the

Articles of Merger that were filed as EX-99.1 to the Form 8-K filed with the Securities and Exchange Commission on September 20, 2021.

At the Effective Time, Prime Time Holdings, Inc.,

4 unchanged sentences

The Company was given a new CUSIP Number by CUSIP Global Services for its common stock of 74167E103.

On September 17, 2021, after the completion

of the Holding Company Reorganization, we cancelled all of the stock held in China Shouguan Investment Holding Group Corp.

On September 17, 2021, immediately after

the completion of the Reorganization, we cancelled all of the stock held in China Shouguan Investment Holding Group Corp.

China Shouguan Investment Holding Group Corp.

as a stand-alone company.

The Company believes that the Reorganization, deemed effective on September

17, 2021, was not a transaction of the type described in subparagraph (a) of Rule 145 under the Securities Act of 1933 and the consummation

of the Reorganization will not be deemed to involve an “offer”, “offer to sell”, “offer for sale”

or “sale” within the meaning of Section 2(3) of the Securities Act of 1933.

The Reorganization was consummated without the

vote or consent of the Company’s stockholders.

In addition, the provisions of NRS 92A.180 did not provide a stockholder of the Company

with appraisal rights in connection with the Reorganization.

The Company believes that in the absence of any right of any of the Company’s

stockholders to vote with respect to the Reorganization or to insist that their shares be purchased for fair value, the Reorganization

could not be deemed to involve an “offer” “offer to sell”;

or “sale” within the meaning of Section

2(3) of the Securities Act of 1933.”

However, if the Company’s belief is later determined to be

incorrect, whereas the Company may have been required to register the transaction under Section 5 of the Securities Act, shareholders

as a result may have a right of rescission under Section 12(a)(1) of the Securities Act.

Those potential consequences may have a substantive

impact on our liquidity now or at any future time.

The SEC could initiate proceedings against the Company and any person that sold securities

in violation of Section 5 of the 1933 Securities Act.

Section 5 of the Securities Act of 1933 prohibits the sale or delivery of unregistered

securities unless a registration statement is in effect as to a security.

Our common stock traded in the OTC Markets

under the Predecessor ticker symbol “CHSO”, and CUSIP number 169420205 under which the common stock of Predecessor previously

listed and traded until our new ticker symbol “PRTM” and CUSIP number 74167E103 was announced September 20, 2021 on the Financial

Industry Regulatory Authority’s daily list with a market effective date of September 21, 2021.

On May 18, 2022, Mr.

2 unchanged sentences

He remains a Director of the

The resignations of Mr.

Jeffrey DeNunzio were not

the result of any disagreement with the Company on any matter relating to its operations, policies, or practices.

The resignation of Mr.

Jeffrey DeNunzio was not the

result of any disagreement with the Company on any matter relating to its operations, policies, or practices.

There is no arrangement

4 unchanged sentences

as the Company’s Chief Executive Officer, Chief Financial Officer, President, Secretary, Treasurer, and Director.

Following the appointments of Ms.

Cassandra DeNunzio,

the Company seeks to explore business opportunities in the area of fire suppression technologies including but not limited to licensing

agreement(s), merger(s), acquisition(s), or business combination transactions after which the Company would cease to be a "shell"

Our Common Stock is quoted on the OTC Markets

Group Inc.’s Pink® Open Market under the symbol “PRTM”.

Our majority shareholder, NVC Holdings, LLC, a Wyoming Limited Liability

Company, and our Directors, Mr.

Jeffrey DeNunzio and Ms.

Cassandra DeNunzio, executed a resolution to ratify, affirm, and approve a name

change from Prime Time Holdings, Inc.

to Sparx Holdings Group, Inc.

The aforementioned parties also approved, via the same resolution,

to change the Company’s ticker symbol and the authorized shares of Common Stock of the Company from 200,000,000 to 500,000,000.

A Certificate of Amendment to change our name and our authorized shares

of Common Stock was filed with the Nevada Secretary of State on July 19, 2022, effective immediately.

On or about July 22, 2022 th e Company

initiated a FINRA corporate action to effectuate the aforementioned name change from Prime Time Holdings, Inc.

to Sparx Holdings Group,

Inc., and to change our ticker symbol.

This corporate action is pending.

We do not yet know what the Company’s

ticker symbol will be changed to, and the ticker symbol chosen will be dependent on current availability and FINRA approval.

The legal date of our name change,

July 19, 2022 will differ from the market release date when posted on FINRA’s daily list.

A Form 8-K will be filed with the Commission

after completion of our FINRA corporate action.

Currently, NVC Holdings, LLC, a Wyoming

LLC owned and controlled by Jeffrey DeNunzio and Thomas DeNunzio is our controlling shareholder, owning 150,000,000 common shares.

The Company has been and remains engaged

in organizational efforts and obtaining initial financing.

The Company has elected June 30 th

as its year end.

We use home office space

of our directors at no cost.

The Company is an “emerging growth company” (“EGC”),

that is exempt from certain financial disclosure and governance requirements for up to five years as defined in the Jumpstart Our Business

Startups Act (the JOBS Act), that eases restrictions on the sale of securities;

and increases the number of shareholders a company must

have before becoming subject to the U.S.

Securities and Exchange Commissions (SEC’s) reporting and disclosure rules (See Emerging

Growth Companies Section Below).

(b) Business Summary

Under SEC Rule 12b-2 under the Exchange Act,

the Company qualifies as a shell company, because it has no or nominal assets (other than cash) and no or nominal operations.

states have enacted statutes, rules and regulations limiting the sale of securities of "blank check" companies in their respective

jurisdictions.

Management does not intend to undertake any efforts to cause a market to develop in our securities, either debt or equity.

The Company intends to comply with the periodic reporting requirements

of the Exchange Act for so long as it is subject to those requirements.

The Company seeks to explore

business opportunities in the area of fire suppression technologies.

This may be in the form of licensing agreement(s), merger(s),

acquisition(s), or business combination transactions after which the Company would cease to be a “shell”

Currently, the Company is in tentative discussions

to enter into a patent licensing agreement with Sparx Technologies, LLC, a Wyoming Limited Liability Company, referred to herein as, “Sparx”,

whereas Sparx would license various patented technology to the Company in exchange for some type of consideration, whether it be shares,

cash, or some combination of the two.

Discussions by and between the Company and Sparx are ongoing, and may not come to fruition.

is no guarantee that the Company and Sparx will enter into a business combination, an arrangement, or an agreement of any kind.

Sparx Technologies, LLC may be

deemed to be a related party, as it is owned and controlled by our Chief Executive Officer and Director Cassandra DeNunzio.

Sparx Technologies, LLC (Sparx) is a technology company registered in the

state of Wyoming, headquartered in Cranston, Rhode Island with a mission to provide fire protection to businesses and building owners

that operate within infrastructures that cannot be reasonably protected by traditional fire sprinklers.

Sparx intends to pioneer the fire

protection industry with a commercially available wireless electronic fire sprinkler network and develop the

industry’s first commercially available wireless electronic fire sprinkler system that can be adaptable for a variety of

different applications and customers.

Sparx has a provisional patent filed with the United States

Patent and Trademark Office (USPTO) on January 28, 2022 under United States Provisional Patent Application Serial No.

63/304,302 intended

to protect Sparx’s battery-powered wireless fire sprinkler technology.

Sparx relies on a combination of patent, trademark, copyright,

trade secret, and contractual protections to establish and protect its intellectual proprietary rights.

As mentioned previously, there is no guarantee that the

current discussions between the Company and Sparx will lead to any material contracts, arrangements, business combinations, or any

other type of agreement.

Should discussions between the two parties terminate, or not lead to anything material, the Company will

need to continue to explore other business opportunities in the fire protection industry.

The analysis of new business opportunities will be undertaken

by, or under the supervision of Cassandra DeNunzio, our Chief Executive Officer and Director.

this date, the Company has not entered into any definitive agreement(s) with any party.

The Registrant has unrestricted flexibility in seeking,

analyzing and participating in potential business opportunities.

In its efforts to analyze potential acquisition targets or business

opportunities, the Registrant will consider the following kinds of factors:

Potential for growth, indicated by new technology, anticipated market expansion or new products;

Competitive position as compared to other firms of similar size and experience within the industry segment as well as within the industry as a whole;

Strength and diversity of management, either in place or scheduled for recruitment;

Capital requirements and anticipated availability of required funds, to be provided by the Registrant or from operations, through the sale of additional securities, through joint ventures or similar arrangements or from other sources;

The cost of participation by the Registrant as compared to the perceived tangible and intangible values and potentials;

The extent to which the business opportunity can be advanced;

The accessibility of required management expertise, personnel, raw materials, services, professional assistance and other required items;

Other relevant factors.

In applying the foregoing criteria, no one of which will be controlling,

management will attempt to analyze all factors and circumstances and make a determination based upon reasonable investigative measures

and available data.

Potentially available business opportunities may occur at various stages of development, all of which will make the

task of comparative investigation and analysis of such business opportunities extremely difficult and complex.

Due to the Registrant's

limited capital available for investigation, the Registrant may not discover or adequately evaluate adverse facts about the opportunity

to be acquired.

Additionally, Sparx Holdings Group, Inc.

will continue to be an insignificant

participant in the business of seeking business opportunities with other entities.

A large number of established and well-financed entities,

including venture capital firms, are active in this space and have significantly greater financial resources, technical expertise and

managerial capabilities than Sparx Holdings Group, Inc.

and, consequently, we will be at a competitive disadvantage in identifying possible

business opportunities and successfully completing a business combination.

Moreover, Sparx Holdings Group, Inc.

will also compete with

numerous other small public companies in seeking such opportunities.

The Company is not required to deliver an annual report to security holders and at this time does not anticipate the distribution of such a report.

The Company will file reports with the SEC.

The Company will be a reporting company and will comply with the requirements of the Exchange Act.

The public may read and copy any materials the Company files with the SEC in the SEC's Public Reference Section, Room 1580, 100 F Street N.E., Washington, D.C.

The public may obtain information on the operation of the Public Reference Section by calling the SEC at 1-800-SEC-0330.

Additionally, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, which can be found at http://www.sec.gov.

Information Regarding our Shell Status

Security holders who received securities from us when we became

a shell company are considered underwriters in connection with any resale of those securities until one year from the date Form 10 information

has publicly filed, as specified in Rule 144(i).

Shares of our common stock which are not registered with the Securities and Exchange

Commission, but are currently held by shareholders, cannot be sold under the exemptions from registration provided by Rule 144 under

or Section 4(1) of the Securities Act (“Rule 144”) so long as the Company is designated a “shell company” and

for 12 months after it ceases to be a “shell company,” provided the Company otherwise is in compliance with the applicable

rules and regulations.

Compliance with the criteria for securing exemptions under federal securities laws and the securities laws of

the various states is extremely complex, especially in respect of those exemptions affording flexibility and the elimination of trading

restrictions in respect of securities received in exempt transactions and subsequently disposed of without registration under the Securities

Act or state securities laws.

Emerging Growth Company

We are an emerging growth company under the JOBS Act.

We shall continue

to be deemed an emerging growth company until the earliest of:

(a) the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,070,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more;

(b) the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective IPO registration statement;

(c) the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt;

(d) the date on which such issuer is deemed to be a large accelerated filer, as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto.

As an emerging growth company, we are exempt from Section 404(b) of Sarbanes

Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal

control structure and procedures for financial reporting.

This statement shall also assess the effectiveness of such internal controls

and procedures.

Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment

on the effectiveness of the internal control structure and procedures for financial reporting.

As an emerging growth company, we are also exempt from Section 14A (a)

and (b) of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes.

We have elected to use the extended transition period for complying with

new or revised accounting standards under Section 102(b)(2) of the Jobs Act, that allows us to delay the adoption of new or revised accounting

standards that have different effective dates for public and private companies until those standards apply to private companies.

result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.

Group Inc.’s Pink® Open Market under the ticker symbol “SHGI”.

A Certificate of Amendment to change our name from Prime Time Holdings,

to Sparx Holdings Group, Inc., and our authorized shares of Common Stock from 200,000,000 to 500,000,000 was filed with the Nevada

Secretary of State on July 19, 2022.

On August 29, 2022, we entered into and consummated a Patent License Agreement

(“Agreement”) with Sparx Technologies, LLC, a limited liability company (“Licensor”).

Licensor is solely owned

and controlled by Ms.

Cassandra DeNunzio, our CEO and director.

DeNunzio is the sole and first named inventor under a provisional

patent application with a Serial No.

63/304,302 filed with the United States Patent Office (“USPTO”) on January 28, 2022,

relating to the fire protection industry and particularly a commercially available battery-operated wireless electronic fire sprinkler

As a result of the Agreement, we adopted the existing operations and business plan of Sparx Technologies, LLC pursuant to the

terms and conditions of the patent licensing agreement and ceased to be a shell company.

On September 19, 2022, Sparx Technologies, LLC filed Trademark Applications

with the USPTO to register our brand name, “SPARX” and Sparx design logo.

Licensor has provided us permission informally to

utilize the brand name SPARX and design logo.

There are no terms of consideration pursuant to this arrangement and no formal agreement.

On November 8, 2022, our corporate action to change our name to Sparx Holdings

Group, Inc., and our ticker symbol from PRTM to SHGI was processed by FINRA with a Daily List Announcement date of November 8, 2022, and

a Market Effective Date of November 9, 2022.

On January 20, 2023, Sparx Technologies, LLC filed under Utility

Patent Application No.

18/099,584 entitled, “Mesh Network Fire Suppression System and Associated Methods” with the United

States Patent & Trademark Office.

The patent describes claims, methods and materials for digital communications between fire sprinkler

heads utilizing battery operated wireless fire sprinkler technology.

On January 23, 2023, Sparx Technologies, LLC filed an international patent

application (PCT) with the USPTO, resulting in international patent pending status.

An international application Serial No.

PCT/US23/11314

was issued by the USPTO.

We use home office space and equipment of our directors at no cost.

Our mailing address is 780 Reservoir Avenue, #123, Cranston, RI 02910.

Our phone number is 774-250-2456.

Currently, we have no contractual employees.

Cassandra DeNunzio

works full time in the development of our business plan and licensed technology from Sparx Technologies, LLC.

The Company has elected June 30 th as its year end.

As of the date of this Annual Report, these and other independent government and trade publications cited herein are publicly available on the Internet

without charge.

We plan to serve a range of markets where we believe traditional

fire sprinkler technology 1 cannot provide adequate or reasonable fire protection.

Our market opportunities include providing

fire suppression for the warehouse and storage industry for high ceiling heights, automated storage and retrieval systems (ASRS systems)

and dense storage, storage of highly flammable commodities like plastic and synthetic materials, lithium-ion based battery energy storage

systems which currently do not have many tested and validated fire protection recommendations, buildings with obstructed constructions

like purlins and girders, buildings with sloped ceilings, forest product storage, aerosol storage, atriums, tunnels, and more.

there is a large opportunity for growth in the global fire sprinkler market due to strict regulations for installing fire suppression

systems worldwide and the increasing investment for businesses and building owners to safeguard their infrastructures and reduce loss

and damage of life, commodities, and property.

The global fire sprinkler market size was valued at $12.49 billion USD in 2021, and is

projected to reach $22.26 billion USD by 2030, registering a CAGR of 7.49% over the forecast period (2022 to 2030) 2 .

introduction of our new technology to the market, we anticipate our innovations spurring market growth.

We plan to first list, approve,

and commercialize our products in the US where the fire sprinkler market reached a value of $4.3 billion USD in 2021 3 .

most of our market opportunity is currently within the commercial segment, specifically within the application of storage and warehousing.

Market research revealed a record-setting level of warehouse construction

in the US, with a groundbreaking addition of 689.4 million square feet (ft.) in the third quarter of 2022 4 .

For new construction

in a high-rise building, the cost per square foot of fire sprinkler coverage is generally $1-$2 USD and in high-rise applications, approximately

$2-$4 USD 5 .

Using a valuation of $3 USD per square foot for fire sprinkler coverage as storage applications tend to be more

expensive than residential applications, with 689.4 million square ft.

of new warehouse construction in the third quarter of 2022, we

estimate the total existing fire sprinkler storage and warehousing market in the US to be valued at approximately $2 billion USD.

we penetrate our initial target market in the US for storage and warehousing, we will consider expanding into the larger global market

for fire sprinklers in the commercial segment and beyond.

We believe the Company can gain market share in the storage and

warehousing segment because we have designed technology to change the underlying fundamentals of how fire sprinklers operate to keep

up with the ever-evolving storage industry.

Warehouses are trending towards higher ceiling heights and greater storage densities to

meet the growing demands of e-commerce and to circumvent the increasing cost of real-estate.

The trend for warehouses 60 years ago

included ceiling heights of 20-25 ft.

while today’s warehouse roof heights trend towards 45 ft.

Warehouses are also implementing automated technology using ASRS and robotics which has changed the way warehouses operate.

ceiling heights and the plastic bins utilized by ASRS structures to store commodities with exceptionally tall racks and narrow

aisles make it very difficult for a traditional fire sprinkler system to control potential files.

These challenges have prompted

retailers, building owners, and insurance providers to reassess their fire protection systems;

however, in many cases there are very

few reasonable and effective options available.

We are developing state-of-the-art technology with a focus on meeting the needs of

retailers and storage customers who are constantly striving to expand their operations and maximize efficiency.

We are confident

that our patent-pending technology, combined with a customer-centric approach, positions us to meet the demands of

the fire sprinkler storage market as ceiling heights continue to increase and the use of automation in warehouses continues to

We are also actively pursuing opportunities to serve areas where

traditional sprinklers are unable to provide sufficient protection.

We see great potential in leveraging our innovative technology to

capture market share in sectors that involve the storage of highly hazardous materials such as aerosols, flammable liquids, tires, and

lithium-ion based battery energy storage systems.

At present, the storage of these commodities is hindered by several limitations driven

by traditional fire sprinkler capabilities including restricted ceiling heights, storage configurations, aisle widths between storage

racks, and more.

Notably, there is no approved or listed fire protection system for lithium-ion based battery energy storage systems.

We intend to leverage, what we believe to be, our cutting-edge technology to address the gaps that traditional fire sprinkler systems

are unable to effectively fill.

With our patent-pending technology we believe we are positioned to

provide superior fire protection solutions for warehousing and storage.

Our multi-sensor technology will allow us to respond to fires

very early on in fire development and our fire sprinklers communicate and work together to prevent fire spread.

We are leveraging software

and electronics to detect and respond to fires faster than traditional fire sprinklers that only rely on a fixed temperature threshold

for activation.

Our approach to get to market quickly and effectively is not to fully replace traditional fire sprinklers, but to use

our technology to enhance their operation and create flexible and adaptable solutions for the fire sprinkler needs of modern storage facilities

and warehouses.

Our technology, at its current rate of development, can currently integrate with 5mm bulb-type traditional fire sprinklers.

We are also working on solutions that are compatible with 3mm bulb-type traditional fire sprinklers as well as solder link-type fire sprinklers

so our technology can be compatible with just about every traditional fire sprinkler on the market.

We believe our technology will allow us to gain market share quickly

and effectively in the storage and warehousing segment because we believe we can make quick changes that influence fire detection and

sprinkler operation through simple software updates.

Our current designs leverage software and electronics so we can easily adjust the

sensors and thresholds used for fire detection and control which sprinklers operate and when.

For a company that relies solely on traditional

fire sprinklers, it could take months of product development to achieve the same goal that could possibly take us minutes with only a

few software changes.

Our technology allows us to be nimble, agile, and responsive when designing for specific applications.

the ability to make rapid design changes for our future customers is crucial for staying competitive and meeting customer demands in today's

fast-paced business environment.

1 Traditional fire sprinklers in the context of this document

are primarily mechanical devices that contain a heat-sensitive element that could be in the form of a glass bulb or a fusible metal link

that will rupture or melt at a certain temperature threshold, activating the sprinkler and allowing water to flow.

Traditional sprinklers

will not turn on all at once.

Each one activates independently, on its own.

Fire Sprinkler Market Trend, Growth to 2022-2030 .

Retrieved February 2, 2023, from https://straitsresearch.com/report/fire-sprinkler-market#:~:text=The%20global%20fire%20sprinkler%20market,period%20(2022%E2%80%932030).

3 IMARC Group.

United States Fire Sprinklers Market:

Industry Trends, Share, Size, Growth, Opportunity and Forecast 2022-2027 .

Retrieved January 9, 2023, from https://www.imarcgroup.com/united-states-fire-sprinklers-market#:~:text=Market%20Overview%3A,US%24%204.3%20Billion%20in%202021.

National Industrial Market Report .

Retrieved February 2, 2023, from https://www.nmrk.com/insights/market-report/national-industrial-market-report.

5 Smoke Guard,

(2022, February 2).

What Is the Cost of a Commercial Fire Sprinkler System?

Retrieved February 2, 2023, from https://smokeguard.com/blog/2022/february/02/what-is-the-cost-of-a-commercial-fire-sprinkler-system#:~:text=A%20high%2Drise%20building%20will,per%20square%20foot%20of%20coverage.

(2022, July 28).

Storage trends and new technology ignite fire risks for commercial warehouses .

Zurichna.com.

Retrieved February

2, 2023, from https://www.zurichna.com/knowledge/articles/2022/07/storage-trends-and-new-technology-ignite-fire-risks-for-commercial-warehouses

Opportunities for Innovation

High Ceiling Heights

Warehouses are shifting towards taller ceiling heights

due to the growing demand for e-commerce, the introduction of machinery and new automation technologies, and the need for more efficient

use of space.

As warehouse ceiling heights increase, warehouse operators will require more efficient and effective fire sprinkler solutions

to expand their operations and protect their investments.

According to Forbes, “Fueled by the global pandemic, a study from US Census

Bureau showed that ecommerce grew 43% in 2020.

Two years later, it’s still going strong — and likely never to return to pre-pandemic

levels despite some near-term signs of economic slowing” 1 .

As e-commerce experiences rapid growth, warehouse facilities

are increasing their clear heights (the usable height in which a tenant can store products on racking) from 32 ft.

clear heights are an extremely large jump from the 20 ft.

average clear height for warehouses in the 1970s.

3 A warehouse

with a 36 ft.

clear height can increase their storage capacity by 10 to 25% as opposed to a 32 ft.

clear height given the same footprint 2 .

With clear heights and ceiling heights continuing to rise, a significant gap is emerging for traditional fire sprinklers.

Higher ceiling heights for storage and warehousing

facilities present a growing opportunity for fire sprinkler innovation.

To provide sufficient protection for warehouses with higher ceilings

and increased storage heights, some traditional fire sprinkler companies have advocated for the installation of in-rack sprinklers, which

are fire sprinklers that are directly integrated into storage racks.

However, this approach has several drawbacks.

For one, installing

in-rack sprinklers can be quite costly, and the sprinklers are vulnerable to damage from heavy equipment, employees, or contractors.

such sprinklers can also restrict the flexibility of the warehouse since they require a network of piping that must be installed into

To keep up with rising ceiling heights in storage, many traditional fire sprinkler companies rely on large orifice sprinklers

and systems with high water demand to provide adequate fire protection.

These sprinklers, called early suppression fast response (ESFR)

sprinklers, are intended to output a large volume of water from the ceiling with larger droplets than conventional sprinkler heads.

Traditional fire sprinkler solutions for providing

protection at higher ceiling heights primarily involve ESFR sprinklers and increasing the amount of water used.

The graph below shows

how the basic sprinkler water demand for higher ceiling heights increases dramatically for traditional fire sprinkler systems, especially

as warehouses shift from 30 ft.

ceiling heights.

The above graph uses data

from FM’s Global Datasheet 8-9 for open-frame rack storage ceiling-only sprinkler protection criteria for traditional K25.2 sprinklers 4

Increasing water usage can come with a high expense.

The water supply available in a warehouse may not be able to generate the necessary hydraulic pressure to meet the demand of a fire protection

system and installing a fire pump, larger piping, and large storage tanks can be incredibly costly.

The fixed cost of a fire pump can

easily exceed $50,000-$60,000 5 , and there are additional costs to consider, such as providing proper electrical and ventilation

for a pump room and ongoing maintenance costs.

A surge in basic sprinkler water demand as ceiling

heights increase from 30 ft.

is especially notable for the storage of uncartoned expanded plastic commodities.

The basic sprinkler

water demand for traditional K25.2 sprinkler systems more than doubles for uncartoned expanded plastics protection and only obtains 10

of ceiling height.

Uncartoned expanded plastics include low density plastics that are not stored in a water absorbing material

like cardboard boxes and include insulation boards, packing beans, polystyrene foam (like for coffee cups, plates, or meat trays), mattresses,

cushioned furniture, candles, pipe insulation, and more.

For many commodities stored at high ceiling heights

the cost of meeting increased water demand could be prohibitively high, and for exposed expanded plastics storage, it can be increasingly

difficult to provide sufficient ceiling-only traditional sprinkler protection.

At Sparx, we strongly believe that relying solely

on excessive water usage with high hydraulic expenses is not the most optimal approach to combat the challenges associated with providing

adequate fire protection for higher ceiling and storage heights.

Our system is specifically designed to minimize hydraulic expenses and

provide effective fire protection by utilizing advanced software and electronics to control sprinkler operating patterns and multi-sensor

technology to identify fires during their early stages of development.

Through algorithmic control of sprinkler operating patterns, we

believe we can precisely target the affected area and maximize the efficiency of the water supply.

We believe our technology also allows

us to detect fires in their early stages through the use of gas, flame, smoke, and temperature sensing.

By suppressing smaller fires,

we believe we can use less water and reduce the overall impact of a fire.

We also believe the Sparx™ Smart

Sprinkler System can provide solutions for warehouses with higher ceiling and storage heights where traditional fire sprinklers

cannot when acting alone.

For example, fires involving the storage of exposed-expanded plastics commodities

for ceiling heights greater than 40 ft.

currently have no prescribed ceiling-only sprinkler protection options

available 4,6 .

Given the high heat release rate and the potential for nearby storage arrays to ignite, thermal radiation

generated by these fires can quickly lead to uncontrolled fire growth.

At higher ceiling and storage heights for this commodity, we

believe it is crucial to have early response and optimal sprinkler operating patterns, both of which are offered by the Sparx™

Smart Sprinkler System, in order to effectively contain thermal radiation and suppress flames.

The challenges posed by increasingly high ceiling

and storage heights in the warehousing industry present an opportunity for innovation in fire sprinkler protection.

At Sparx, we are dedicated

to meeting the evolving needs of the industry.

With our patent-pending technology, we believe we are well-positioned to offer effective

solutions for even the most complex storage and warehousing fire protection applications.

(2022, September 8).

E-commerce popularity ignites growing investment in warehouse automation .

Retrieved February 16,

2023, from https://www.forbes.com/sites/danielnewman/2022/09/06/e-commerce-popularity-ignites-growing-investment-in-warehouse-automation/?sh=2d0881925346

(2020, October 22).

36 is the new 32:

Increasing clear height for maximum efficiency .

Method Architecture.

February 16, 2023, from https://methodarchitecture.com/industrial-clear-height-36/

(2018, March).

Raise the roof!

When to consider higher cubic clear heights for your warehouse operations .

https://pdf.euro.savills.co.uk/usa/in-depth-reports/ov-warehouseoperations-isg-2018-03-29.pdf.

Retrieved February 16, 2023.

(2022, January).

FM Global Datasheet 8-9, Storage of Class 1, 2, 3, 4 and Plastic Commodities.

Johnston, RI.

Fire & Security.

(2022, March 23).

Introduction to Fire Pumps .

Koorsen Fire & Security.

Retrieved February 16, 2023, from

https://blog.koorsen.com/introduction-to-fire-pumps

6 National Fire Protection

NFPA 13, Standard for the Installation of Sprinkler Systems, 2022 Edition.

Automated Storage and Retrieval Systems (ASRS)

To enhance space utilization and boost throughput, warehouses are

adopting compact automated storage and retrieval systems, commonly referred to as ASRS systems.

ASRS systems are computer and robot-aided

systems that can retrieve or store items in specific locations.

We expect the increased use of automation in warehouses to directly impact

market opportunities in the storage segment for fire sprinklers as these innovations will require specialized fire protection.

The warehouse-automation

market is forecasted to reach $51 billion by 2030, a CAGR of 23 percent 1 .

We predict that the tremendous growth in the warehouse-automation

industry is going to create market expansion for the fire sprinkler storage segment.

When a fire occurs, compact ASRS systems can be extremely hazardous

because firefighters have limited access to extinguish fires following sprinkler operation.

In the storage industry, traditional fire

sprinkler systems are typically not designed to extinguish a fire, but instead, they are intended to suppress and control a fire until

the fire department or fire service is able to intervene.

If a fire originates deep in the upper tiers of an ASRS storage array, it can

be incredibly unsafe for firefighters to navigate a 35 ft.

tall structure with slim aisles and limited mobility.

Compact ASRS systems

are escalating the demand for fire sprinkler systems that not only suppress fires in storage facilities but can also extinguish them.

This presents a significant opportunity for innovation in the fire sprinkler industry, as extinguishing fires is storage occupancies is

currently not a function of traditional fire sprinkler systems.

Extinguishing fires is just one of many challenges facing traditional

fire sprinkler systems in the context of compact ASRS systems.

With such systems becoming increasingly dense, there is often no available

space to install in-rack sprinklers and piping, which cannot be placed in areas that would obstruct robotic movement or bracing.

Additionally,

the high storage density of compact ASRS makes it difficult for ceiling-only traditional Early Suppression Fast Response (ESFR) sprinklers

to reach the base of a fire.

Another obstacle posed by compact ASRS is the frequent use of open-top containers, which facilitate order

picking but lack protection guidance based on NFPA 13 - Standard for the Installation of Sprinkler Systems 2 .

These containers

impede the flow of water from fire sprinklers to the base of an ASRS structure, making them hazardous from a fire protection perspective.

Together, these challenges have led to limited regulatory prescribed code options for fire sprinkler systems that can provide adequate

protection for compact ASRS systems 3 .

As the warehouse-automation market continues to grow, demand for fire sprinkler innovation

in this space is expected to rise.

Many ASRS systems have uniquely designed storage bins, robotic mechanisms,

robotic movement, and structural configurations.

We believe there will be opportunities for partnering with ASRS and retail companies

to create custom fire sprinkler solutions tailored to specific customer applications, since compact ASRS solutions each have distinctive

characteristics that pose their own fire protection challenges.

We believe that it will take a nimble and agile company in fire sprinkler

technology development, like Sparx, to adapt solutions to the rapidly changing warehouse environment and quickly bring solutions to market

for a variety of compact ASRS structures.

With the Sparx™ Smart Sprinkler System, we can transform the way our system operates within

minutes rather than months of product iteration.

The Sparx™ Smart Sprinkler System can be easily configured based on a variety of

sensor inputs to trigger various sprinkler responses using software.

We believe the Sparx™ Smart Sprinkler System is an ideal solution

for ASRS fire protection because of its multi-sensor technology that can detect fires at an early stage, maximizing the chances for both

suppression and extinguishment.

Additionally, the system provides precise sprinkler operating patterns that can pinpoint the fire's origin

and prevent its spread within densely packed storage areas.

This technique allows for a 'surround and drown' approach, enabling quick

action to deliver an abundance of water directly to the fire and the surrounding areas, effectively inhibiting any outward propagation

1 Barbee , J., Davies, A., Dubeauclard , R., Lange , T.,

& Lennartz, C.

(2021, December 27).

Automation has reached its tipping point for omnichannel warehouses .

McKinsey & Company.

Retrieved February 16, 2023, from https://www.mckinsey.com/industries/retail/our-insights/automation-has-reached-its-tipping-point-for-omnichannel-warehouses

2 National Fire Protection

NFPA 13, Standard for the Installation of Sprinkler Systems, 2022 Edition.

3 UL Solutions.

New Challenges in Fire Safety in ASRS Warehouses .

UL Solutions.

Retrieved February 16, 2023, from https://www.ul.com/resources/new-challenges-fire-safety-asrs-warehouses

Unique Architectures

Unique architectural elements like sloped ceilings

are currently one of the biggest challenges associated with traditional ESFR sprinklers, according to the Fire Protection Research Foundation 1 .

For storage applications, NFPA 13 - Standard for the Installation of Sprinkler Systems limits ceilings to a maximum slope of 2 in 12 (equivalent

to a roof slope of about 9.5 degrees) when using ceiling-only ESFR sprinklers 2 .

According to FM standards, the maximum ceiling

slope in storage applications can be 10 degrees for ceiling-only sprinklers, unless in-rack sprinklers are installed 3 .

with sloped ceilings can also install a continuous flat ceiling below their roof to maintain compliance for ESFR sprinklers, but this

comes with added expense and hassle.

Sloped ceilings alter the dynamics for how the hot

gases travel along the ceiling during a fire which can lead to skewed sprinkler operating patterns and an increase in sprinkler operations

using traditional ceiling-only ESFR sprinklers 3 .

Considering the challenges that traditional fire sprinklers have in this application

and the lack of approved or listed options for ceiling-only sprinkler protection beyond 10 degree sloped ceilings in storage, the market

for sufficient fire suppression in this area is completely open for innovation.

Research demonstrates that correction factors can

be applied to electronic fire sprinkler activation algorithms to achieve optimal sprinkler operating patterns for buildings with sloped

However, there are currently no listed or approved ceiling-only fire sprinklers on the market for storage occupancies

with sloped ceilings beyond 10 degrees.

The Sparx™ Smart Sprinkler System decouples detection from sprinkler activation unlike traditional

ESFR fire sprinklers, which allows us to provide algorithmic correction factors to potentially offer protection for this challenging application.

Protection of Storage Under Sloped Ceilings Phase III:

Large Scale Testing Summary and Guidance .

Fire Protection Research Foundation.

2 National Fire Protection

NFPA 13, Standard for the Installation of Sprinkler Systems, 2022 Edition.

(2022, January).

FM Global Datasheet 8-9, Storage of Class 1, 2, 3, 4 and Plastic Commodities.

Johnston, RI.

SMART Sprinkler for Highly Challenging Fires .

Retrieved February 16, 2023, from https://www.sfpe.org/publications/periodicals/sfpeeuropedigital/sfpeeurope20/europeissue20feature1

High-Hazard Commodities

Ceiling-only fire sprinklers face numerous challenges when it comes

to storing high-hazard commodities.

The fire sprinkler industry requires third-party evaluation of products to be approved or listed for

their use in facilities to protect the building, its occupants, and the commodities being stored.

Fire sprinkler products undergo extensive

third-party testing – two of the most common groups being FM Global (FM) and UL Solutions (UL).

Additionally, there are codes and

standards like the National Fire Protection Association in the United States, a global self-funded nonprofit organization, that develops

codes and standards related to fire sprinkler design and installation requirements.

Upon reading the codes and standards provided by FM

and NFPA, we believe the gaps within the traditional fire sprinkler industry start becoming clear.

Many of these gaps, in our opinion,

appear to exist with the storage of high-hazard commodities like tires, aerosols, and flammable and combustible liquids.

Additionally,

the use of battery energy storage systems (BESS) presents a relatively new high-hazard commodity to the fire protection industry.

table below highlights high-hazard commodities that present potential opportunities for the innovative fire protection offered by the

Sparx™ Smart Sprinkler System.

Hazard Description

Current Limitations for Ceiling-Only Sprinklers

Opportunities for Innovation

Tires produce large amounts of heat, smoke, and toxic gases and are often stored in dense and compact arrangements

Maximum ceiling height of 40 ft., with 30 ft.

of storage in permanent and portable racks with open shelves 1,2

The criterion for 40 ft.

ceilings/30 ft.

of tire storage requires a basic sprinkler water demand of more than 2,600 gpm of water which

could result in high hydraulic expense

There are no prescribed ceiling-only fire sprinkler options available for tires stored at heights greater than 30 ft.

Aerosols – Level 2 (deodorants, hair sprays, antiseptics, anesthetics, some furniture polishes, and windshield de-icers, and other water-miscible flammable aerosol products)

Aerosol products can rupture under the presence of heat and flames,

creating large fire balls that can increase the intensity of a fire

Maximum storage heights of only 20 ft.

for cartoned aerosols with ceiling-only fire sprinkler protection (aerosols stored in cardboard boxes) 3

· The maximum storage height for these commodities is very limited - only 20 ft.

storage heights 3

Aerosols – Level 3 (some automotive products like engine and carburetor cleaners, undercoats and lubricants, wood polishes, paints and lacquers, some insecticides, oil-based antiperspirants, and more)

Maximum storage heights of only 15 ft.

for cartoned aerosols with

ceiling-only fire sprinkler protection (aerosols stored in cardboard boxes) 3

Ceiling-only fire sprinkler protection cannot be provided for

uncartoned Level 3 aerosol products 3

The maximum storage height for these commodities is extremely limited – only 15 ft.

storage heights for cartoned storage 3

There are no options for ceiling-only fire sprinklers to protect uncartoned storage of Level 3 aerosols (in-rack sprinklers must

be used which decreases warehouse flexibility, increases susceptibility to sprinkler damage from warehouse operations, and piping networks

must be installed within storage racks) 3

Flammable and Combustible Liquids (commodities including gasoline, cleaners, rubbing alcohol, nail polish remover, hand sanitizer, cooking oils, and more)

Flammable liquids produce vapors that burn when heated or ignited – fires can burn readily and intensively and can be explosive under certain conditions

Most configurations for flammable and combustible liquids require in-rack sprinkler protection 4

Warehouses are constrained in terms of flexibility since the fire protection design is often designed to meet the needs of a specific

flammable or combustible liquid application

In most circumstances, flammable and combustible liquids require in-rack sprinkler protection 4

Lithium-Ion Battery Energy Storage Systems (BESSs)

Thermal runaway* is a unique and dangerous hazard in BESS and once

started, thermal runaway cannot be stopped

*Thermal runaway is a hazardous phenomenon in which a lithium-ion

cell enters an uncontrollable, self-heating state.

Thermal runaway can result in the release of toxic gases, extremely high temperatures,

smoke, and fire.

Sprinkler systems installed per NFPA 13 are required for per NFPA 855 - Standard for the Installation of Stationary Energy Storage Systems;

however, there is no fire protection system approved or listed for the protection of lithium-ion based energy storage systems 5,7

The global lithium-ion battery market is expected to grow at a remarkable 18.9% CAGR over the forecast period from 2022 to 2030 which

we predict will create market expansion for the global fire sprinkler market 6

According to NFPA 855 - Standard for the Installation of Stationary Energy Storage Systems, “ water is considered the preferred

agent for suppressing lithium-ion battery fires ” 5

Fire sprinklers can delay or prevent fire spread to adjacent battery cells decreasing the likelihood of propagation of thermal runaway

Currently, there are no fire protection systems that are currently FM-Approved or UL-Listed for the application of BESSs 7

To effectively achieve suppression or extinguishment, fire sprinkler systems will require electronics and software to detect fires quickly

and accurately – the best protection systems will be able to integrate with battery management systems and ventilation systems

The table above outlines the existing constraints

for fire sprinkler systems when storing high-hazard commodities, while also identifying the factors that could stimulate advancements

in fire sprinkler technology.

The Sparx™ Smart Sprinkler System provides early fire detection

using multiple sensors, allowing us to respond to fires faster than traditional fire sprinkler systems.

Early detection can facilitate

a more rapid response to a fire, allowing the fire sprinkler system to initiate suppression or extinguishment quickly.

This can significantly

reduce the time that the fire has to grow and spread, making it easier to control and suppress or extinguish.

The Sparx™ Smart Sprinkler System employs algorithms to control

fire sprinkler operations, providing efficient and targeted fire suppression to prevent the spread of fires.

The algorithms used by the

Sparx™ Smart Sprinkler System are instruction sets and computational procedures used to control the operation of the sprinklers

in a more efficient and targeted manner, based on factors such as the location and severity of the fire.

By using algorithms to optimize

the operation of the sprinklers, water usage can be reduced while still effectively suppressing the fire.

Sprinklers are activated through

an automated process initiated by our software, which sends an electrical signal to activate the sprinklers as needed.

For instance, if

a fire were to break out in an aerosol storage area, the Sparx™ Smart Sprinkler System could promptly trigger the sprinkler head

directly above the fire, along with those surrounding it, to deliver water to both the fire's source and the surrounding aerosol commodities,

effectively suppressing any fireballs that might emerge from rupturing products.

Traditional fire sprinklers in storage applications are

designed to operate independently of one another which can lead to challenges when it comes to fire spread and adequate suppression performance.

With quick detection and controlled sprinkler operating patterns,

we believe Sparx can provide protection for high-hazard commodities in applications that traditional fire sprinklers cannot.

to use the Sparx™ Smart Sprinkler System to fill industry gaps for the storage of high-hazard commodities at higher storage heights,

higher ceiling heights, and to provide an alternative to in-rack sprinkler protection.

For scenarios that currently require high hydraulic

expenses from ceiling-only ESFR sprinklers, we believe our technology will also require less water demand since we are responding to smaller

fires very early on in fire development.

Moreover, when it comes to addressing specific challenges, such as the safe storage of battery

energy storage systems, our expertise will enable us to offer highly effective fire sprinkler protection through quick and targeted sprinkler

response, efficient cooling, and seamless integration with battery management and ventilation systems.

(2009, January).

FM Global Datasheet 8-3, Rubber Tire Storage.

Johnston, RI.

2 National Fire Protection

NFPA 13, Standard for the Installation of Sprinkler Systems, 2022 Edition.

3 National Fire Protection

NFPA 30B, Code for the Manufacture and Storage of Aerosol Products, 2023 Edition.

4 National Fire Protection

NFPA 30, Flammable and Combustible Liquids Code, 2021 Edition.

5 National Fire Protection

NFPA 855, Standard for the Installation of Stationary Energy Storage Systems, 2023 Edition.

6 AltEnergyMag.

(2022, November 1).

Lithium-ion Battery Market Growing Demand, Globally .

AltEnergyMag.

Retrieved February 16, 2023, from https://www.altenergymag.com/content.php?post=38477

Fire Protection Requirements for Large-Scale Energy Storage Systems (ESS).

Retrieved February 16, 2023, from https://www.linkedin.com/pulse/fire-protection-requirements-energy-storage-systems-ess-dieken-pe

The fire sprinkler industry is made up of a relatively small number of

key companies including AG Fire Sprinkler, American Fire Technologies, APi Group, GW Sprinkler A/S, Honeywell International Inc., Johnson

Controls International Plc, Minimax GmbH & Co.

KG, Robert Bosch GmbH, Siemens AG, and SIRON Fire Protection 1 .

We believe there to be only a few key companies in this industry, generally

due to the high barriers to entry that come from product testing, approvals, and certification from agencies like UL Solutions (UL), FM

Global (FM), and VdS.

While there are some notable companies involved in the competitive landscape for the fire sprinkler industry, as

a whole, we believe Sparx has very few direct known competitors who are primarily focused on using software and electronics to offer protection

for highly challenging fires.

We are predominantly dedicated to the advancement of technology in the

fire protection industry as opposed to simply releasing the next iterative fire sprinkler product.

We believe our approach will offer

us lucrative growth opportunities as we expand our foothold in the global fire sprinkler market.

Because we are focused on offering protection

for highly challenging fires (fires that cannot be easily and reasonably protected by traditional sprinkler technology), by nature, we

believe we are competing in a highly uncompetitive space.

In the industry there are currently only two UL Listed electronic fire

sprinklers (a K17 2 version and a K25 2 version) on the market capable of electronic detection and actuation.

electronic sprinklers, both released by Johnson Controls International Plc, operate via wired communications and power 3 .

sprinklers require a separate heat detector for each and every sprinkler that must be connected by an installer via a wiring harness.

The sprinklers are also wired to each other and back to a control panel via Class A or B wiring (usually Class A for added reliability) 4 .

This system, marketed for storage applications, has inherent complications and costs due to the amount of wiring required.

that a battery-powered wireless solution will eliminate the installation complexities that can come from running wire between 100+ sprinkler

heads and the high labor costs associated with this system.

In addition to the electronic sprinkler products offered by Johnson Controls

International Plc, a US based company called Plumis Inc.

offers a product called Automist Smartscan Hydra.

The Automist Smartscan Hydra

offers a fire sprinkler alternative for the application of residential occupancies up to and including four stories in one or two family

dwellings with light and ordinary hazards 5 .

The Automist Smartscan Hydra system also provides a wired solution to connect the

controller to various water mist heads.

The water mist heads are generally wall mounted and operate on different principles than sprinkler

Water mist is intended to use fine droplets that evaporate at the base of a fire to extract heat.

Sparx intends to pursue a different

market share compared to the Plumis Inc.

solution by tackling highly challenging fires with wireless sprinkler technology as opposed to

pursuing residential applications with wired water mist systems.

We believe our proprietary technology has a competitive advantage in that

it offers a flexible wireless battery-powered solution that will solve a multitude of problems present in wired electronic sprinkler systems.

We believe the complexity and costs due to installation for a wireless system will be much lower for our future customers in terms of

material (wire, connectors, conduit, etc.), but especially for labor.

We plan to capture more revenue for a premium product that offers

ease of installation compared to a wired system where revenues are normally lost to electricians, electrical unions, and electrical contractors.

We also believe the wireless solution we plan to bring to market will be less prone to human error during installation.

In a wired solution,

it can be exceedingly difficult to troubleshoot multiple wires if there are shorts, opens, or ground faults present, especially if the

system is protecting dense storage structures with ceiling heights that are 35+ feet tall.

Our proprietary technology could also increase

system reliability compared to a wired solution due to the fact that our solution operates on a wireless network with numerous communication

paths from fire sprinklers to the controller as opposed to only a single or duplicate set of wires.

In our findings and experience, we have seen only a few attempts and efforts

made to bring electronics and software into the predominantly mechanical world that fire sprinklers have belonged to since their inception.

We believe we are uniquely positioned to deliver and commercialize the first battery-powered wireless fire sprinklers that elegantly synthesize

detection and suppression.

A., Singh, S.

P., & Sumant, O.

Fire Sprinkler Market .

Allied Market Research.

Retrieved January 27, 2022, from

https://www.alliedmarketresearch.com/fire-sprinkler-market.

2 The k-factor of a sprinkler, or coefficient

of discharge, is a specification for fire sprinklers used to calculate the flow and water discharged from sprinkler heads.

Blackstone, V.

What is the K factor on a sprinkler head?

Retrieved January 29, 2022, from https://www.hunker.com/13418788/what-is-the-k-factor-on-a-sprinkler-head

Controls International Plc.

EAS-1 System Overview .

Johnsoncontrols.com.

Retrieved January 30, 2022, from https://www.johnsoncontrols.com/eas/overview

Training Center.

NFPA 72 Circuits and Pathways .

National Training Center.

Retrieved January 30, 2022, from https://nationaltrainingcenter.com/nfpa-72-circuits-and-pathways/

Automist Smartscan Hydra BS8458 fire sprinkler performance .

Retrieved January 29, 2022, from https://plumis.com/smartscan

We are a technology company incorporated in the state of Nevada on June

30, 2021, and headquartered in Cranston, Rhode Island with a mission to provide new generation fire protection to businesses and building

owners that operate within infrastructures that cannot be adequately or reasonably protected by traditional fire sprinklers 1 .

We intend with Sparx Technologies, LLC (“Sparx”) to revolutionize the fire protection industry with a commercially available

wireless battery-powered electronic fire sprinkler network and develop the industry’s first commercially available wireless battery-powered

electronic fire sprinkler system that can be adapted to a variety of different applications and customers.

On August 29, 2022, we entered into and consummated a Patent License Agreement

(“Agreement”) with Sparx Technologies, LLC, a limited liability company (“Licensor”).

Licensor is solely owned

and controlled by Ms.

Cassandra DeNunzio, our CEO and director.

DeNunzio is the sole and first named inventor under a provisional

patent application with a Serial No.

63/304,302 filed with the United States Patent Office (“USPTO”) on January 28, 2022,

relating to the fire protection industry and particularly a commercially available battery-operated wireless electronic fire sprinkler

The Patent License Agreement, referenced herein, is attached as EX-10.1 to the Form 8-K filed with the Securities and Exchange Commission

on August 29, 2022.

As a result of the Agreement, we adopted the existing operations and business plan of Sparx Technologies, LLC pursuant

to the terms and conditions of the patent licensing agreement and ceased to be a shell company.

In partial consideration for the exclusive license granted by Licensor

to the Company, the Company paid Sparx Holdings, LLC, a limited liability company, controlled and solely owned by Ms.

DeNunzio, a non-refundable

license fee upon execution of the Agreement in the amount of One Hundred Million shares (100,000,000) of the Company’s common stock

(the “Initial License Fee”).

The Initial License Fee is consideration for the grant and continuation of the license pursuant

to a five-year term.

Licensor shall have no obligation or liability to return any portion of the Initial License Fee.

The Company shall

pay Licensor a royalty of fifty percent (50%) of Licensee’s Net Sales of all Licensed Products developed and sold by the Company.

Ownership of the licensed technology prior to, during the course or as a result of the Agreement, will be the sole and exclusive property

Our Chief Executive Officer and Director, Casandra DeNunzio has agreed

to lend us equipment at no cost resulting in us having in-house capabilities to design and build innovative electronic fire

protection products and solutions.

DeNunzio has extensive industry knowledge, familiarity with local specifications and regulations,

fire codes and expertise in the design and test engineering of fire detection, suppression, and extinguishment technology and their components

We have available to us, the equipment, capabilities, and expertise to create prototype electronic circuits, assemble and

reflow printed circuit boards, benchtop test electrical assemblies with DC and AC power supplies, troubleshoot designs with multimeters,

and create wiring harnesses.

The Company has now begun to finalize the prototype Sparx™

Smart Sprinkler System and has started working towards the design and development for the remaining system components to complete

the Sparx™ Smart Sprinkler System.

The remaining components needed for the system prototype include a base station that

the wireless battery-powered Sparx™ Smart Sprinkler Systems communicate with and an installation and commissioning tool.

mentioned elsewhere in this Annual Report, a utility patent has been filed with the USPTO that covers the technology.

The Company plans to

commercialize Licensor’s wireless fire suppression technology into a fire protection/fire safety product line and seek listing

or approval from third-party testing bodies.

Our plan is to provide superior protection against highly challenging fires for a range

of premises, including commercial buildings and industrial sites, through the application of our advanced proprietary wireless mesh

network fire suppression system technology.

We plan to design, develop, integrate, install, test, manufacture, produce, and market

our wireless mesh network fire suppression system in an effort to commercialize our products.

On January 20, 2023, Sparx Technologies, LLC filed a utility patent application

with the USPTO under 35 USC 111(a) for a Mesh Network Fire Suppression System and Associated Methods with Serial No.

provisional application with Serial No.

63/304,302 was issued by the USPTO on January 28, 2022.

In addition, an international patent application (PCT) was also filed with

the USPTO on January 23, 2023, resulting in international patent pending status.

An international application Serial No.

PCT/US23/11314

was issued by the USPTO.

Sparx relies on a combination of patent, trademark, copyright, trade secret, and contractual protections to establish

and protect its intellectual proprietary rights.

The Basics of Our Technology

We plan to use the Sparx™ Smart Sprinkler System to expand the capabilities

of traditional fire sprinklers and offer effective and efficient protection for applications that traditional fire sprinklers may not

adequately cover.

An image of a traditional fire sprinkler is shown below.

The image above shows a

traditional fire sprinkler with labeled components

A traditional fire sprinkler system consists of two essential components:

a water supply and a fire sprinkler head.

The sprinkler head comprises a plug, a trigger mechanism, a frame, and a deflector plate.

plug holds back the water, while the trigger mechanism activates the sprinkler head when the temperature reaches a specific threshold.

This threshold typically ranges from 135 to 286 degrees Fahrenheit and is determined by the designers based on the specific environment

and application.

The trigger mechanism can be a glass bulb filled with liquid that expands when heated causing the glass to break or two

metal plates held together by a solder point that separates when heated.

When a fire starts, the hot air rises and spreads

along the ceiling until it reaches a sprinkler head.

When the temperature threshold is met, the trigger mechanism is activated, and the

plug is released, allowing the water to flow through the sprinkler head.

The water hits the deflector plate, causing the water droplets

to disperse over a larger area.

The water will continue to flow until the water supply runs out or the fire department arrives and manually

shuts off the water via the system’s control valve.

A common misconception perpetuated by popular media

is that every sprinkler in a room activates at the same time during a fire.

Modern fire sprinkler heads are designed to operate independently.

This means that a specific sprinkler head will activate and release water, only if it has individually reached a certain temperature threshold.

Traditional fire sprinkler systems can encounter

various obstacles that may compromise their effectiveness including unpredictable operating sequences, unintentional cooling of adjacent

areas after sprinkler activation, and a phenomenon known as 'sprinkler skipping,' whereby sprinklers closer to the fire may fail to activate

before those located further away.

These factors can put lives and property at risk, highlighting the need for modern and innovative fire

suppression technologies.

Our system is being designed to provide

effective fire suppression by automatically activating a group of existing sprinklers directly above the fire.

This method ensures

water delivery to the base of the fire and wets adjacent areas to prevent the fire from spreading.

Our system's unique capability to

automatically activate an optimal group of sprinklers for fire suppression or extinguishment distinguishes us from traditional fire

sprinkler solutions that rely solely on the heat produced by a fire to activate the necessary sprinklers.

We believe our technology

offers greater predictability, precision, and efficiency in controlling fires.

Recognizing the critical role of rapid sprinkler

response in suppressing fires, we strive to respond promptly to catch smaller fires that are easier to contain or extinguish with fire

Fires can exhibit distinct behaviors depending on the commodities and storage configurations involved.

Some fires may smoke

or smolder during their early stages, while other fires may rapidly reach the ceiling with high heat release rates.

The exclusive dependence

on a fixed temperature threshold by traditional sprinklers is not the most effective approach for timely detection in all fire scenarios.

We have integrated multi-sensor technology into our fire sprinkler designs, featuring flame, gas, smoke, and temperature sensors to provide

comprehensive and advanced fire detection.

The Sparx TM Smart Sprinkler System

Sparx is in the process of designing and developing a fire sprinkler

system capable of electronic detection, communication, and actuation.

By leveraging cutting-edge electronic and software

technologies, we aspire to enhance the capabilities of traditional fire sprinklers allowing us to serve applications that otherwise

could not be protected.

Our wireless battery-powered fire sprinklers come equipped with advanced sensing capabilities, including

flame, gas, smoke, and temperature sensors.

Using our multi-sensor technology, we can detect fires at their earliest stages, even

before they have a chance to grow significantly.

Our unique approach to fire safety is critical because fires tend to spread

rapidly, and the larger they become, the more challenging they are to control.

We believe our ability to respond quickly and

efficiently will open up new opportunities for various fire protection scenarios.

We are using mesh networking topology to allow our fire sprinklers to communicate

with each other and provide seamless coordination of fire suppression efforts.

A mesh network is a local area network in which nodes (in

this case, sprinklers) connect directly, dynamically, and non-hierarchically to each other, working together to efficiently route data.

Our fire sprinklers communicate with each other and to a central base station in the network, providing unparalleled situational awareness

compared to traditional systems.

Using environmental data gathered by our fire sprinklers, the base station makes informed decisions about

which sprinklers to actuate in the event of a fire, ensuring optimal suppression or extinguishment.

By controlling the number of sprinkler

operations, the base station avoids over-stressing the water supply and minimizes water damage, all while achieving the desired level

of fire suppression.

With our mesh networking topology and advanced sensing capabilities, we believe we can respond quickly, efficiently,

and with superior activation precision, making it possible to protect even the most challenging fire scenarios.

At Sparx, we are developing technology that transforms traditional fire

sprinklers into wireless, battery-powered marvels.

Our wireless, battery-powered system is designed to expand the capabilities of traditional

fire sprinklers, enabling them to detect and respond to fire conditions faster and with greater precision than ever before.

Our technology

seamlessly integrates with existing traditional fire sprinkler systems, harnessing the proven safety and reliability of these established

We plan to take advantage of the carefully engineered spray patterns and stringent testing standards for traditional fire sprinklers

and use our technology to augment their functionality.

We believe that by combining our technology with traditional fire sprinklers it

will allow us to provide effective and reasonable fire protection solutions in applications that may not have been possible with traditional

fire sprinklers alone.

Each Sparx™ Smart Sprinkler contains electronics housed near the

sprinkler threads and wrench flats.

The electronics include sensors used for detecting fire, a communication module, a replaceable battery

pack, actuation circuitry used for automatically triggering sprinkler operation in the event of a fire, and monitoring circuitry used

to supervise the integrity of necessary electrical components.

Sparx™ Smart Sprinklers have the ability to communicate with other

using modules that are FCC Certified (USA), operate on the Industrial, Scientific, and Medical (ISM) band, and are RoHS compliant.

electronics in the network are designed to enter low-power sleep modes and wake periodically to sample environmental conditions to prolong

battery-life.

The electronics and battery packs for Sparx™ Smart Sprinklers are designed to last for reasonable periods of time

The base station for the network will be able to provide notification if there are any low-battery warnings or any other

issues with the network that should be addressed.

The base station will also be able to display a history of any troubles, supervisory

signals, or alarms that are reported in the network.

Our inaugural Sparx™ Smart

Sprinkler System prototype, which is currently in the research and development phase, has been purposefully engineered to interface with

traditional fire sprinklers that comprise 5mm frangible glass bulbs.

To ensure the electronics at each sprinkler remain unscathed during

sprinkler head installation, they can be easily attached by an installer after the sprinkler head is threaded into the piping.

Our installation

process has been meticulously designed to be streamlined, swift, and uncomplicated, saving warehouse and storage customers from the high

costs and laborious efforts associated with installing wired electronic fire sprinkler systems.

Wired electronic fire sprinkler systems

necessitate the hiring of electrical contractors to run conduit along the ceiling between sprinkler heads, connecting wires to numerous

junction boxes, and troubleshooting issues such as shorts, opens, and ground faults at the ceiling-level.

The image above shows a

labeled drawing of the Sparx™ Smart Sprinkler prototype, viewed from the side with transparent electronics enclosures.

Note that the enclosures

in the image above are transparent for the purpose of this picture, but the actual product will have fully opaque enclosures.

The image above shows the

Sparx™ Smart Sprinkler prototype, tilted upwards, viewed from the side.

The image above illustrates

the Sparx™ Smart Sprinkler prototype connected to a water supply.

The image above depicts the

Sparx™ Smart Sprinkler prototype tilted downwards, exposing the sprinkler threads.

The prototype includes a baseplate that sits

around the sprinkler head above the wrench flats, similar to a recessed sprinkler escutcheon.

The sprinkler can be installed with the

baseplate, and after the sprinkler is threaded into the pipe, the electronics enclosures are able to be attached to the baseplate by the

installer in the field.

The electronics enclosures are designed to sit around the perimeter of the sprinkler threads and pipe connection.

We have designed an actuating mechanism that interfaces with traditional

5mm bulb-type fire sprinklers.

The mechanism simply clips onto the outside surface of the glass bulb with an ordinary amount of force

(no tools required), allowing for quick and easy installation.

A short wiring harness connects the clip to the housed electronics at the

sprinkler threads and wrench flats, which can be connected by an installer during the sprinkler installation process.

To ensure proper

circuit integrity and fire safety, both the short wiring harness and actuating mechanism within the clip are electrically monitored.

Additionally,

a proximity sensor can be incorporated onto the clip to verify proper fit of the clip mechanism against the glass bulb for added reliability.

In the event of a fire, when a sprinkler head is provided with an actuation

instruction via software, the clip mechanism will cause the glass bulb to break which allows water to flow out of the sprinkler head.

The clip mechanism is designed to quickly provide ample heat to the glass bulb, allowing it to shatter, causing the sprinkler plug to

be pushed out by water flowing through the sprinkler.

This clip mechanism allows our advanced software and hardware to decide when to

operate fire sprinklers, as opposed to traditional fire sprinklers which activate only from the heat produced by a fire.

Pictured above:

Rendering - clip mechanism

Pictured above:

Physical clip mechanism from our physical development prototype

The images above both

show a Sparx™ Smart Sprinkler prototype with the attached clip mechanism that we have designed to allow the sprinkler to be

operated via an electrical signal.

The clip comprises a small heating element that rapidly heats the bulb until it shatters when

provided with ample power from the electronics assembly that this mechanism connects to.

While the entirety of the Sparx™

Smart Sprinkler system remains in the developmental stages, and further alterations may be made to the overall aesthetic or design, pictured

below is a full physical, working, prototype we have created of the system, less the base station and commissioning tool.

is for a single system to include numerous “sensing units”.

Specifically, these are the portions that communicate with one

another via the base station/ commissioning tool and fit directly over a single sprinkler head.

Pictured above:

Inactivated bulb style sprinkler

head with Sparx™

Sensing Unit (fits around bulb style sprinkler head)

Pictured above:

Activated bulb style sprinkler

head with Sparx™

Sensing Unit (fits around bulb style sprinkler head)

our functioning development prototype here:

https://www.youtube.com/watch?v=BtlJBlV4qFk

To ensure a safe and reliable

installation process, we currently plan to pre-install the actuating mechanism clips onto the sprinkler bulbs during manufacturing.

approach eliminates any risk of damage to the sprinkler bulb during the sprinkler installation process, providing peace of mind for installers

in the field.

We believe that our fire sprinkler system will be ideal for new installations, or for retrofit installations where existing

sprinkler systems will be drained and traditional sprinkler heads will be replaced with Sparx™ Smart Sprinklers.

We are currently finishing development of our Sparx™ Smart

Sprinkler prototype that can interface with traditional 5mm bulb-type sprinklers.

Currently, our primary focus is on completing the rest of the Sparx™ Smart Sprinkler System.

Our plan is to develop a base station, an installation

tool, and a web-based dashboard for building owners and maintenance managers to monitor their system's health and status.

the base station is a critical component of the Sparx™ Smart Sprinkler System because it manages when sprinklers enter

low-power sleep modes, makes decisions on sprinkler actuation during a fire, and notifies users of any troubles, supervisory

signals, or alarms present in the network.

To facilitate optimal sprinkler actuation during a fire, the system needs

to know the locations of all Sparx™ Smart Sprinklers within a design area.

Our installation and commissioning tool will enable installers

to easily and accurately map out sprinkler locations and feed that information back to the base station.

In addition, we plan to create a web-based interface that allows building

owners and maintenance managers to monitor their system's health and status, set up notification settings, and receive alerts via text

messages or emails when the system needs maintenance or if there are any troubles, supervisory signals, or alarm conditions indicating

the presence of fire and sprinkler activation.

While we expect to encounter some challenges during the system's development,

we are confident that we can overcome them.

Our team has already tackled the hardest technical challenges, such as developing a reliable

network architecture that enables low-power battery operation and creating a fire sprinkler prototype capable of electronic detection

and actuation.

With our sights set on completing the remaining components, we look forward to delivering an advanced and robust wireless

battery-powered electronic fire sprinkler system to our future customers.

We welcome partnership opportunities with traditional fire sprinkler companies

interested in integrating their traditional fire sprinkler products with our technology.

Our product is designed to work with existing

5mm bulb-type traditional fire sprinklers, and we plan to expand our product line to support 3mm bulb-type sprinklers as well as link-type

fire sprinklers.

Our current wireless battery-powered technology can also be configured to interface with Metron or squib-type electronic

fire sprinklers.

We remain committed to exploring new ways to enhance our technology and provide seamless integration with a range of

traditional fire suppression systems.

Internal Verification and Validation Testing

As we continue to develop our base station technology and installation

interface tool for sprinkler mapping, we are also working to conduct preliminary verification and validation testing on our fire sprinkler

Our aim is to conduct comprehensive testing before submitting our product to third-party approval agencies for listing and

Third-party testing is crucial for the fire-sprinkler industry as it enables effective marketing of products, but it can also

Thus, we seek to conduct as much preliminary testing as possible to identify and address any design changes before third-party

testing, in order to streamline and expedite the listing or approval process.

We will be conducting various tests on our fire sprinkler prototype based

on existing standards from third-party approval agencies, like UL or FM.

Our internal testing program will include conducting spray testing

to ensure our technology does not interfere with sprinkler spray patterns, mechanical testing like rough-usage tests, high-temperature

exposure tests, vibration tests, corrosion tests and electrical testing including set-point accuracy tests, transient tests, dielectric

voltage-withstand tests, and more.

We will also plan to internally conduct small-scale fire tests to confirm our Sparx™ Smart Sprinkler

System works as intended before we conduct large-scale fire tests at third-party testing bodies like UL or FM.

Third-Party Testing

To effectively market our products, third-party testing

is necessary.

UL and FM are two of the most common third-party entities in the United States that provide listing, approval, or certification

UL is a reputable testing institute that is one of the largest public safety testing labs in the world, while FM also has an

international reputation for testing and is well-regarded in the industry.

In contrast to UL, FM is an insurance company that provides

insurance coverage to customers that use products that they have approved or certified to their own testing standards.

Our initial objective is to obtain UL Listing to

fill an industry gap for providing adequate and reasonable sprinkler protection in storage and warehousing applications.

We would also

like to obtain FM Approval for the Sparx™ Smart Sprinkler System, but we believe that there may be additional testing with FM due

to our product’s novelty in the fire sprinkler industry.

Our plan is to first work with UL to see how our product performs in large-scale

testing, before working with FM on a test program for FM Approval.

The third-party testing required for our product will most likely include

mechanical and electrical testing, as well as large-scale fire testing.

Our product's first application will be focused on

providing adequate suppression for a storage application that cannot be currently protected with reasonable water demand.

We want to ensure

that our first application for testing is in line with the fire protection requirements for the average clear heights of the current proposed

industrial developments for storage and warehousing.

We plan to allocate a significant portion of our funding towards conducting large-scale

fire tests, which can be expensive due to the need for experienced personnel and state-of-the-art test labs that can handle fire hazards.

Fire tests for high-storage heights must be conducted in at least three scenarios, as fires can originate directly under a single sprinkler

head, between two sprinkler heads, or among four sprinkler heads.

We estimate the cost of each large-scale fire test for high-storage

heights to range anywhere from $250k to $1M.

Following a test program with UL, we may decide to pursue FM Approval so

we can sell our products to more customers, conduct performance-based design solutions for individual customers, or work towards conquering

other challenging fire suppression applications.

Commercial Scale Up and Revenue Stream

After successfully completing a comprehensive test

program with a highly reputable third-party testing body, we aim to take our business to the next level by increasing our inventory and

expanding our marketing efforts to reach storage and warehousing customers.

Our marketing campaigns will highlight our advanced technology

and will showcase the ease of use when implementing our products.

We are also committed to establishing strong relationships with fire

protection code consultants and engineers and sprinkler installation and service companies to ensure that our product is recognized as

a top option in the market.

Our revenue streams will be predominately generated from the sale of, what

we believe to be, our superior products that we anticipate offering.

We also anticipate generating additional revenue from our innovative

software-as-a-service (SaaS) tool.

Our primary revenue source will be our product revenue

model, which is based on differentiating our products as specialty goods.

Our target customers are warehouses and storage facilities with

certain applications that require fire protection options beyond what traditional fire sprinklers can offer.

Our goal is not to directly

compete with traditional fire sprinkler protection, but to complement traditional fire sprinklers with, what we believe to be, our superior

This product revenue stream will provide the financial foundation to cover our expenses, invest in new products, and expand

our business.

By positioning our products as specialty goods, we can create a perception of high value and exclusivity among our customers,

enabling us to charge premium prices.

Additionally, our unique selling proposition of wireless, battery-powered electronic fire sprinkler

technology that can interface with traditional fire sprinklers is not currently available in the market, reducing competition.

that the quality and performance of our products will lead to increased customer loyalty and distinctive brand identity due to their premium

quality and their ability to adequately and reasonably provide protection in applications that are considered highly challenging for fire

Our company is also planning to offer specialized

training services for companies that provide licensed inspection, testing, and maintenance services for fire protection systems.

We understand

the importance of ongoing maintenance and servicing for fire sprinkler systems, which is why we aim to guide these companies in the proper

installation and servicing of our revolutionary Sparx™ Smart Sprinkler System.

Our training program will provide us with indirect

sales revenue by creating an ecosystem of knowledgeable and confident users who are more likely to recommend and promote the Sparx™

Smart Sprinkler System.

It is crucial for those installing and servicing our system to have the knowledge and confidence necessary to

ensure proper installation and functionality.

Our training program will cover all aspects of installing and servicing our system, from

basic installation and troubleshooting to more advanced maintenance and repair.

As our customers become more proficient in using our products,

they can also become advocates for it.

This is particularly true in the fire protection industry where word-of-mouth recommendations can

be critical to success.

In addition, our training program can also help build trust and credibility with our customers.

By investing in

training and education, we are demonstrating a commitment to supporting our customers and ensuring their success with the Sparx™

Smart Sprinkler System.

This can help to build long-term relationships with our customers and increase their loyalty to our brand.

believe that this will not only generate indirect sales for our company but will also enhance the quality of service provided to our customers,

resulting in increased customer loyalty.

Our revenue stream also includes our subscription-based SaaS tool that

offers customers the convenience of accessing our software application to monitor the health and status of their fire sprinkler system,

wherever and whenever they need to.

Additionally, our customers can choose to receive timely notifications via SMS or email alerts in

case of any trouble, supervisory signals, or alarm conditions present in their system.

This service is beneficial to customers to gain

insight to their system whenever and wherever they want to, even if they are away from the warehouse.

Regular inspection, testing, and

maintenance is necessary for all fire sprinkler systems, and for electronic fire sprinkler systems, there may be additional requirements

such as retrieving reports from the system to verify that sprinklers are detecting temperatures within a normal range.

With the establishment

of timely notifications for inspection, testing, and maintenance needs, building owners and warehouse maintenance managers can proactively

manage the requirements for their fire sprinkler system, resulting in peace of mind that their fire sprinkler systems will perform when

Our SaaS tool can provide a predictable and steady revenue stream generated by recurring subscriptions and can help provide stability

and predictability for our business over time.

Intellectual Property

Sparx Technologies, LLC filed a provisional patent application

with a Serial No.

63/304,302 filed with the United States Patent Office (“USPTO”) on January 28, 2022, a utility patent application

filed with the USPTO on January 20, 2023 with Serial No.

18/099,584, and an international application filed with the USPTO on January

23, 2023 with Serial No.

PCT/US23/11314 intended to protect Sparx’s battery-powered wireless fire sprinkler technology.

on a combination of patent, trademark, copyright, trade secret, and contractual protections to establish and protect its intellectual

proprietary rights.

Sparx Technologies, LLC has also filed federal trademark registration

applications in the U.S.

for the SPARX word mark and logo covering use with our goods and services which are pending examination.

We believe it is important to our success that we:

Obtain and maintain patents and other legal protections covering our proprietary art, materials, technology, inventions, applications of such, and improvements we consider important to our business;

Prosecute our patent and trademark applications and enforce our intellectual

property rights;

Preserve the confidentiality of our trade secrets;

Operate without infringing the patents, trademarks or proprietary rights of third parties.

We believe that there is a lot of room for innovation to meet the

fire protection needs of today's modern businesses and building owners.

The design of fire sprinklers has not changed significantly over

the last fifty or so years and still consists of mostly simple mechanical components 1 .

Traditional sprinklers cultivated

from 19 th century science use the same physical element to detect fires as they do to cause water to flow.

Traditional fire

sprinklers can face many complications because the heat-sensitive operating element shares two important primary functions, fire detection

and sprinkler actuation.

If a fire starts near the ground under a storage rack in a tall warehouse, significant fire spread can occur

by the time a fire is detected at the ceiling, where sprinklers are commonly located.

A single sprinkler could operate and a phenomenon

known as sprinkler skipping can occur that will cause sprinklers farther away from the fire origin to activate earlier than those that

are closer and fire can continue to spread 2 .

Our patent pending technology will allow for the decoupling of fire detection

from sprinkler activation and will provide us with the ability to have greater control over sprinkler operations and respond to fires

very early on in fire development.

We believe that we can disrupt the fire sprinkler industry with our ability to leverage electronics

and software in fire sprinkler system design by fundamentally changing the way the industry approaches fire suppression.

We intend to create a framework for fire protection that will allow

for wireless communication and electronic detection and actuation of sprinklers.

With this framework, we will be able to use the same

basic hardware components, and program application-specific algorithms 3 tailored to the building, environment, and the structure

and commodities the system is designed to protect.

Our advanced algorithms are computation instructions designed to regulate the sampling

of sensor data by fire sprinklers and accurately detect the presence of fire.

When a fire condition is detected, the algorithm automatically

triggers the most optimal fire sprinklers to suppress that fire via software, resulting in effective and efficient fire suppression.

framework will allow us to make minimal, non-invasive changes when applying our patent pending technology from one customer-specific application

to the next, allowing us to formulate solutions for various highly challenging fires quickly and effectively.

Having the ability to pull

additional levers with software and algorithms will give us the edge we need to deliver where traditional sprinklers cannot.

able to use software to change the way sprinklers respond to fires without redesigning the physical components of the sprinkler itself.

This flexibility and adaptability will give Sparx an advantage when it comes to making design changes and expanding our product offerings.

“A History of Fire Sprinklers - IFSEC Global:

Security and Fire News and Resources.” IFSEC Global | Security and Fire

News and Resources.

IFSEC Global | Security and Fire News and Resources, May 1, 2019.

https://www.ifsecglobal.com/fire-news/a-history-of-fire-sprinklers/.

2 Xin, Yibing.

“SMART Sprinkler for Highly Challenging Fires.” SFPE Europe , Issue 20 (Q4 2020).

https://www.sfpe.org/publications/sfpeeuropedigital/sfpeeurope20.

3 Our application specific algorithms will contain a set

of instructions that govern which sprinklers are needed for operation and when those sprinklers must operate in the event of a fire.

instructions may be different for various applications depending on factors like building layout, ceiling heights, commodity, how the

commodity is stored, etc.

We have no contractual employees.

Cassandra DeNunzio is our Chief

Executive Officer, Chief Financial Officer, President, Secretary, Treasurer, and director.

Jeffrey DeNunzio is also a director of

Cassandra DeNunzio and Jeffrey DeNunzio are our only directors.

At this time, Cassandra DeNunzio and Jeffrey DeNunzio are not

compensated for their services provided to the Company.

We have no plans at this time to compensate any of our directors however, we

may elect to compensate them in the future for services they may provide to the Company.

DeNunzio works full time for both Sparx Holdings Group, Inc., and

Sparx Technologies, LLC.

Sparx Technologies, LLC is a Wyoming Limited Liability Company.

August 29, 2022, we entered into a Patent License Agreement with Sparx Technologies, LLC and adopted its operations and business plan

to commercialize new generation wireless fire suppression technology developed by our CEO into a fire protection/fire safety product

line (including the Sparx™ Smart Sprinkler System ).

DeNunzio has the flexibility to further our business plan and develop new generation fire suppression

Jeffrey DeNunzio works full time as an outside business consultant, however, he assists part time in assisting Ms.

Cassandra DeNunzio in further the Company’s business agenda.

We do not presently have pension, health, annuity, insurance, stock options,

profit sharing, or similar benefit plans;

however, we may adopt plans in the future.

There are presently no personal benefits available

to our officer and directors.

Risk Factors.

The Company qualifies as a smaller reporting company, as defined by Item

10 of Regulation S-K and, thus, is not required to provide the information required by this Item.

As a smaller reporting company, as defined

in Rule 12b-2 of the Exchange Act, we are not required to provide the information called for by this Item.

Unresolved Staff Comments.

We currently neither rent nor own any properties.

We currently have no policy with respect to investments or interests in real estate, real estate mortgages or securities of, or interests

in, persons primarily engaged in real estate activities.

We currently utilize the home office space and equipment of our management at

At present, we do not rent nor own any

We utilize home office space of management at no cost.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business