UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31 2017, 2023

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission file number 333-172658File Number: 000-56148

TraqIQTitan Environmental Solutions Inc.

(Exact name of registrant as specified in its charter)

Thunderclap Entertainment, Inc.

(Former name of registrant as specified in its charter)

14205 SE 36th Street, Suite 100(248)775-7400

Bellevue, WA 98006(Registrant’s Telephone Number, Including Area Code)

(Address of principal executive offices)

Registrant’s telephone number, including area code:(425) 818-0560

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Exchange Act:

Common Stock, $.0001 par value $0.0001 per share

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act [  ]Act. Yes [X] ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. [  ] Yes [X] ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sectionsection 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrantRegistrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [X] Yes [  ] ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). [  ] Yes [X] ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non- acceleratednon-accelerated filer, or a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “non-accelerated filer”, “smaller reporting company” and “emerging growth”growth company” in Rule 12b-2 of the Exchange Act.:

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]☐

Indicate by check mark if disclosurewhether the registrant has filed a report on and attestation to its management’s assessment of delinquent filersthe effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Yes ☐ No ☒

If securities are registered pursuant to Item 405Section 12(b) of Regulation S-K (Section 229.405the Act, indicate by check mark whether the financial statements of this chapter) is not contained herein, and will not be contained,the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the best of registrant’s Knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendmentexecutive officers during the relevant recovery period pursuant to this Form 10-K. [X] Yes [  ] No§240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [  ] Yes [X]☐ No☒

The aggregate market value of the voting and non-voting common stock, other than shares held by persons who may be deemed affiliates of the registrant, as of June 30, 2023, the last day of the registrant’s most recently completed second fiscal quarter, was $12,808,304, computed by reference to the closing sales price for the registrant’s common stock on June 30, 2023, as reported on The OTCQB market operated by OTC Markets Group.

There is currently no active market for our common stock.

The number ofwere 25,386,814 shares of the Registrant’sregistrant’s common stock, $0.0001 par value, per share, outstanding as of March 12, 2018, was 6,824,250.29, 2024.

TITAN ENVIRONMENTAL SOLUTIONS INC.

TABLE OF CONTENTS

GENERAL INFORMATION

Cautionary Note Regarding Forward Looking Statements

Summary of Principal Risk Factors

As used in this Annual Report on Form 10-K, the terms “we”, “us”, “our” and the “Company” mean Titan Environmental Solutions Inc. and its wholly owned subsidiaries, taken as a whole (unless the context indicates a different meaning).

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

CertainThis Annual Report on Form 10-K contains forward-looking statements discussedthat involve substantial risks and uncertainties. The forward-looking statements are contained principally in Item 1 (Business), Item 1A (Risk Factors), Item 3 (Legal Proceedings), Item 7 (Management’sthe sections titled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations), Item 7A (QuantitativeOperations” and Qualitative Disclosures About Market Risk) and“Business,” but are also contained elsewhere in this Annual Report on Form 10-K as well as in other materials and oral statements that the Company releases from time to time to the public constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Suchreport. In some cases, you can identify forward-looking statements concerning management’s expectations, strategic objectives, business prospects, anticipated economicby the words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “objective,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue” and “ongoing,” or the negative of these terms, or other comparable terminology intended to identify statements about the future, although not all forward-looking statements contain these words. These statements relate to future events or our future financial performance and financialor condition and other similar matters involve significant known and unknown risks, uncertainties and other important factors that could cause theour actual results, levels of activity, performance or achievements of resultsachievement to differ materially from any future results, performance or achievements discussedthose expressed or implied by suchthese forward-looking statements. SuchThese forward-looking statements include, but are not limited to, statements about:

You should read this report, including the section titled “Risk Factors,” and the documents that we reference elsewhere in this report and have filed as exhibits to this report, completely and with the understanding that our actual results may differ materially from what we expect as expressed or implied by our forward-looking statements. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties and other important factors are discussed in Item 1A (Risk Factors) and Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations. In addition,these forward-looking statements, you should not regard these statements constitute the Company’s cautionaryas a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time frame, or at all.

These forward-looking statements under the Private Securities Litigation Reform Act of 1995. It should be understood that it is not possible to predict or identify all such factors. Consequently, the following should not be considered to be a complete discussion of all potential risks or uncertainties. The words “anticipate,” “estimate,” “expect,” “project,” “intend,” “believe,” “plan,” “target,” “forecast”represent our estimates and similar expressions are intended to identify forward-looking statements. Forward-looking statements speakassumptions only as of the date of the document in which they are made. The Company disclaims anythis report. Except as required by law, we undertake no obligation to update or undertaking to provide any updates or revisions torevise publicly any forward-looking statementstatements, whether as a result of new information, future events or otherwise after the date of this report. All subsequent forward-looking statements attributable to reflect any change in the Company’s expectationsus or any changeperson acting on our behalf are expressly qualified in events, conditionstheir entirety by the cautionary statements contained or circumstances onreferred to herein.

SUMMARY OF PRINCIPAL RISK FACTORS

This summary briefly lists the principal risks and uncertainties facing our business, which are only a select portion of those risks. A more complete discussion of those risks and uncertainties is set forth in Part I, Item 1A of this Annual Report, entitled Risk Factors. Additional risks not presently known to us or that we currently deem immaterial may also affect us. If any of these risks occur, our business, financial condition or results of operations could be materially and adversely affected. Our business is subject to the forward-looking statement is based. It is advisable, however, to consult any further disclosures the Company makes on related subjects in its Quarterly Reports on Form 10-Qfollowing principal risks and Current Reports on Form 8-K filed with the Securities and Exchange Commission.uncertainties:

Emerging Growth Company Status

PART I

Overview

We are an “emerging growth company,” as definedintegrated provider of non-hazardous solid waste and recycling collection, transportation, transfer and disposal services. We also provide technology-enabled solutions for food waste processing, including onsite digesters for food waste, together with cloud-based software tracking and analytics solutions. We currently have the majority of our operations in Michigan but are looking to expand our presence across the Jumpstart Our Business Startups Act enacted in April 2012,Midwest, Northeast and for as long as we continue to be an “emerging growth company,” we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404Southeast regions of the Sarbanes-Oxley ActUnited States.

Our principal operating subsidiary, Titan Trucking, LLC (“Titan Trucking”), which is based in Troy, Michigan, is a non-hazardous solid waste management company providing waste and recycling collection and transportation services for industrial generators, commercial contractors and transfer station operators located in Michigan. Titan Trucking began non-hazardous waste collection operations in May 2017 and completed the asset acquisitions of 2002, reduced disclosure obligations regarding executive compensationCentury Waste, Inc and WTI Global Waste and Recycling Services, Inc. in June 2022 and December 2022, respectively. Through these companies, we currently operate a fleet of 23 vehicles. All of Titan Trucking’s revenue for the years ended December 31, 2023 and 2022 was derived from the provision of roll-off, rubber wheel and long-haul tractor trailer services to its customers.

In January 2023, Recoup Technologies, Inc. (“Recoup Technologies”) was formed to serve as our food waste digester operating company and acquired technologies and equipment for on-site biological processing of food waste, as well as proprietary real-time data analytics tools to reduce food waste generation. These proprietary solutions can enable businesses, including restaurants, hotels and other hospitality venues, cruise ships and educational facilities of all sizes to lower disposal costs while having a positive impact on the environment. We believe our food processing solutions can reduce the carbon footprint associated with waste transportation, repurpose non-recyclable plastics, and significantly reduce landfill usage.

Our Operating Strategy

Our objective is to expand the geographic scope of our operations and to become one of the leading providers of non-hazardous solid waste management in each market that we serve. Our operating strategy to achieve this objective is to capitalize on the continuing consolidation of the solid waste management industry by (i) identifying and penetrating new markets and expanding our operations in our periodic reportsexisting markets through tuck-in acquisitions that are combined with existing operations, (ii) increasing profitability by vertically integrating our operations and proxy statements,achieving economies of scale, and exemptions from(iii) internalizing greater volumes of disposal waste through the requirementsacquisition of holding a nonbinding advisory vote on executive compensationstrategic landfills and stockholder approval of any golden parachute payments not previously approved.transfer stations, and (iv) achieving internal growth. We will remain an “emerging growth company” until the earliest of (i) the last day of the fiscal yearseek to avoid highly-competitive, large urban markets and instead target markets in which we have total annual gross revenuescan attain high market share either through exclusive contracts, vertical integration or asset positioning. We will seek to be among the leading providers of $1 billion or more; (ii) the last day of the fiscal year following the fifth anniversary of the date of the first salewaste services in most of our common equity securities pursuant to an effective registration statement; (iii) the date onmarkets. The key components of our operating strategy, which we have issued more than $1 billion in non-convertible debt during the prior three year period; and (iv) the date on which we are deemed to be a “large accelerated filer.” We may take advantage of the extended transition period until the first to occur of the date we (i) are no longer an “emerging growth company” or (ii) affirmatively and irrevocably opt out of the extended transition period. Consequently, our financial statements may not be comparable to companies that comply with public company effective dates.

PART I

Item 1. Business

Overview

On July 19, 2017, TraqIQ, Inc. (the “Company”) entered into a Share Exchange Agreement (the “Share Exchange Agreement”) with OmniM2M, Inc. (“OmniM2M”) and its shareholders (the “OmniM2M Shareholders”) and Ci2i Services, Inc. (“Ci2i”) and its shareholders (the “Ci2i Shareholders”) whereby the OmniM2M Shareholders and the Ci2i Shareholders agreed to exchange all of their respective shares in OmniM2M and Ci2i in exchange for 3,000,000 shares each of the Company’s common stock, par value $0.0001, effective upon the execution of the Share Exchange Agreement by all of the OmniM2M Shareholders and the Ci2i Shareholders. The OmniM2M Shareholders and the Ci2i Shareholders will each be allocated their respective 3,000,000 shares on a pro rata basis based on their respective holdings in OmniM2M and Ci2i when the Share Exchange Agreement has been fully executed. On August 3, 2017, the Company closed the transaction pursuanttailored to the Share Exchange Agreement with the OmniM2M Shareholderscompetitive and the Ci2i Shareholders.regulatory factors that affect our markets, are as follows:

Upon completion of the Share Exchange, TraqIQ, Inc. (“TRAQIQ”, or the “Company”) comprised the business activities of two subsidiary companies: Ci2i Services, Inc. (“Ci2i”) and OmniM2M, Inc. (“OmniM2M”).

OmniM2M, Inc.

The Industrial Internet of Things (“IIoT”) is about the transformation of any physical object into a digital data solution. Once you attach a sensor to it, a physical object (whether a tiny one like a pill that goes through your body, or a very large one like a plane or building) starts functioning a lot like any other digital solution – it emits data about its usage, location and state; it can be tracked, controlled, personalized and upgraded remotely; and, when coupled with all the progress in Big Data and artificial intelligence, the digital solution can become intelligent, predictive, collaborative and in some cases semi-autonomous.

According to Gartner Group, there will be over 21 billion “things” connected to the internet by 2020, or in other words, 3 things per each human being on earth. The Gartner Group reported that the market size for services is expected to be $235 billion in 2016, with the majority coming from business services. Wintergreen Research (2016) more conservatively estimates the commercial IIoT market at $16.3B in 2016 and reaching $185.9B by 2023.

OmniM2M is focused on the IIoT, thereby helping commercial customers increase their return on investment in their facilities.

Applications

Waste Industry Overview

With an estimated $73.7 billion market share for 2023, the waste collection services industry focuses on collecting hazardous and nonhazardous waste and recyclable materials. Nonhazardous waste includes municipal solid waste, household waste, and industrial and commercial waste. The industry also includes the operations of transfer stations where waste is relocated from local vehicles to long-distance vehicles like long haul trucks or trains for transport to disposal facilities or sorted for further processing. Given the utility-like nature of trash and recyclable material collection, the industry is highly recession resistant. While it has been immune to technological disruptions, the ability to leverage new technologies, such as video surveillance, smart meters, digital health monitorsautomated and energy-efficient vehicles, represent a host of other services are creating new requirements and opportunities for new IIoT devices and solutions.benefit to businesses, which is expected to continue over the coming years.

OmniM2M provides bundled solutions of hardware, software, connectivity, applications and analytics to address targeted problems in refrigeration, pest control and tank monitoring. OmniM2M’s unique solutions can be deployed rapidly and provides considerable Return on Investment (ROI) benefits immediately by saving up to 25% of an employee’s time or meeting of corporate compliance goals). OmniM2M has deployed solutions that are currently being used by several customers with positive results.

OmniM2M Refrigeration Solution

The OmniM2M Refrigeration Solution includes a piece of hardware (the size is about that of a smart phone) that is deployed in the refrigeration units. It has a cellular connection to the OmniM2M software in the cloud. The solution tracks the temperature and alerts the user via email and/or text if there is a change in the temperature. When the health inspector performs its assessment, the customer can simply print or email the data using the OmniM2M reporting feature solution. In addition to monitoring food, the OmniM2M solutions can potentially prevent food poisoning outbreaks by safely monitoring food and equipment to their optimum temperatures.

Customer Pain Points

The typical refrigeration customer (restaurant/meat distributor/catering) frequently has issues with its equipment breaking down, meeting compliance requirements and ensuring product freshness. Aging equipment typically results in significant financial losses when the asset fails. The typical restaurant has a regulatory requirement to log the temperature in its refrigeration units four (4) times per day. This data is compiled manually by employees who check each unit and log the temperature. Since it’s a manual process, there is generally no monitoring performed outside of business hours. Assets tend to fail outside of normal hours when employees are not on location and the issue or failure is not detected.

The Solution

The OmniM2M Refrigeration Solution includes a piece of hardware (the size is about that of a smart phone) that is deployed in the refrigeration units. It has a cellular connection to the OmniM2M software in the cloud. The solution tracks the temperature and alerts the user via email and/or text if there is a change in the temperature. When the health inspector performs its assessment, the customer can simply print or email the data using the OmniM2M reporting feature solution. In addition to monitoring food, the OmniM2M solutions can potentially prevent food poisoning outbreaks by safely monitoring food and equipment to their optimum temperatures.

OmniM2M Pest Control Solution

By installing a small sensor on the pest trap, the OmniM2M Pest Control Solution notifies a control technician when a pest has been caught in a trap. This notification enables the user to check the trap when it has caught the targeted vermin. Our OmniM2M Pest Control Solution also complies with state and federal laws by sending daily status reports of the active traps.

This solution results in a saving of up to 2 hours of employee time per day and reduces driving time on average, by approximately 50 miles per day.

OmniM2M Tank Monitoring Solution

By installing a small sensor in any large tank (that holds liquids), the OmniM2M Tank Monitoring Solution notifies the user electronically when the tank needs to be refilled. This solution saves considerable expense of unplanned truck rolls for refilling the tanks.

By installing a small sensor in any large tank (that holds liquids), the OmniM2M system notifies the user electronically when the tank needs to be refilled. This solution saves considerable expense of unplanned truck rolls for refilling the tanks.

Ci2i Services, Inc.

Ci2i was formed about over 15 years ago andDuring the past four decades, our industry has most recently been providing IT consulting solutions, predominantly in the business intelligence and data analytics arenas. The company has been a vendor to Microsoft for over 10 years, and has done work with many Microsoft product and business groups, including Microsoft Azure and Microsoft Media planning. Ci2i has worked closely with customers including bConnections, where a wide varietyexperienced periods of analytics solutions were built.

Ci2i’s cloud solutions and analytics services comprise software development, program management, project management, and business analytics services.

In 2014, Ci2i was invited into the Microsoft Supplier Program (MSP), which was designed to make it convenient for Microsoft business managers to identify and work with a pre-qualified group of suppliers. Over 80% of Microsoft’s annual spend is with MSP suppliers and MSP suppliers account for only 10% of Microsoft’s total active supplier population. In order to qualify for MSP, companies must also be nominated and be a part of the Approved Supplier List.

In 2015, Ci2i was invited into Microsoft’s Contractor Hub program, an external staffing program designed to help Microsoft employees identify the right resources for all of their time & materials contractor needs. As a result of participating in Microsoft’s Contract Hub program, Ci2i will increase its visibility with many new Microsoft Business Groups who can use Ci2i’s time & material based resources, thereby further accelerating Ci2i’s revenue growth.

Ci2i made it to the fastest growing list at Inc magazine – multiple times from 2006-2009. This includes being ranked 398 on the US Inc 500 list.

The Competitive Environment

The IIoT marketplace is very fragmented marketplace comprised of a few dozen Fortune 50 companies offering development platforms and networking infrastructure; about 100 Fortune 1000 companies offering a range of products, services and solutions across multiple industry segments; and at least 100 smaller start-up companies and publicly traded companies that offer a small number of products, services and solutions in targeted industry segments.

substantial consolidation activity; however, we believe significant fragmentation remains. We believe that OmniM2Mthere are two primary factors that lead to consolidation:

Management believes that the larger public companies as well as those backed by private equity firms target the larger revenue generating companies available in their respective markets leaving smaller sellers with less access to acquirers. We will succeed by focusingfocus on those niche smaller opportunities where we can take advantage of our entrepreneurial approach.

Operations

Through our subsidiaries, we provide solid waste collection services to approximately 475 industrial and commercial customers in the Metropolitan Detroit, Michigan area. In the years ended December 31, 2023 and 2022, substantially all of our collection revenue was derived from services provided to industrial customers. However, it is our intention to increase substantially the revenues we derive in our current business operations from services provided to commercial customers. We also expect to acquire companies that derive significant revenues from commercial and residential customers.

Collection Services. Collection involves picking up and transporting waste and recyclable materials from where it was generated to a small numbertransfer station, material recovery facility (“MRF”) or disposal site. We generally will provide collection services under one of industry segments – such as Transportation, Energy (Oil & Gas), and Resource Management – and by offering data analytics and systems integration services that complement the saletwo types of IIoT devices to enterprise customers.arrangements:

TransportIQ, Inc. (“TransportIQ”)

AccordingIn our roll off waste collection operations, we supply our customers with waste containers of various sizes of dumpsters that are primarily used for construction and demolition debris but can also be used for municipal waste and recyclable materials. These containers are designed so that they can be lifted mechanically on to a collection truck to be transported to a disposal facility. By using these containers, we can service our customers with trucks operated by a single employee. Roll off collection services are not generally performed under long-term service agreements but are provided on an “on call” basis. In certain cases, contract terms may apply but tend to be shorter in length, in some cases having terms of only six months, and may vary according to the customers’ underlying projects. Fees are generally charged in one of two ways: fixed fee per pick up depending on the size of equipment provided, or separate fees for transportation of the dumpster provided added to the disposal cost for materials deposited in our equipment and disposed of. Disposal fees can vary depending on type of material and origin of the waste.

Additionally, we rent rubber wheel trailers to smaller generators of waste such as homeowners and small commercial contractors. Rubber wheel trailers are primarily used for clean up debris and in some cases smaller quantities of construction and demolition debris. Rubber wheel trailers generally cause less trauma to customer property and are more convenient to load or relocate on a customer location. We tow the rubber wheel trailers with our standard vehicles and transport them with the waste to either a landfill or a transfer station for disposal. Fees for rubber wheel services are similar to those for roll off collection services.

Transportation and Disposal Services. All solid waste management companies must have access to a disposal facility, such as a solid waste landfill. While landfills are the main depositories for solid waste in North America, the significant capital requirements of developing and operating a landfill serve as a barrier to landfill ownership, and, thus, we currently utilize third party disposal facilities. It is usually preferable for our collection operations to use disposal facilities that we own or operate, rather than using third-party disposal facilities, which generally allows us to realize higher consolidated margins and stronger operating cash flows. The fees charged at disposal facilities, which are referred to as tipping fees, are based on several factors, including our cost to construct, maintain and close the landfill, the distance to an alternative disposal facility, the type and weight or volume of solid waste deposited and competition.

In many cases where waste generators are not within close proximity to landfills, waste is disposed of at transfer stations. Transfer stations act as intermediary facilities where smaller quantities of waste can be delivered and consolidated into vehicles capable of transporting larger quantities of material. Transfer station operators can achieve economies of scale by transporting these larger quantities. Transportation from transfer stations is normally provided via tractor trailer style vehicles but can also be achieved using alternate transportation means such as rail or barge. Transfer station operators normally charge a fee for volume delivered to their facility usually measured in tons or cubic yards. The main costs to transfer station operators is the disposal fee charged by the final disposal facility which can be a landfill, waste to energy facility, or other licensed disposal facility, together with the cost associated with the transportation of the material. As transfer station operators are dependent upon transporters to ultimately remove the waste delivered to their facility, these services are in high demand.

Recycling Services. Recycling involves the separation of reusable materials from the waste stream for processing and resale or other disposition. We not only collect materials from households and businesses in our service areas, we also sell them to manufacturers to be recycled and sold in the North American Trucking Association (ATA),market. Demand for recycled materials is generally growing. Several states have recently passed minimum-recycled-content mandates, and many companies are responding to requirements for recycled content from their own customers and to meet sustainability targets. While we currently do not own any recycling facilities, as we expand our service offerings, we will seek to build or acquire such facilities in an effort to attract additional customers and increase our operating margins.

Food Waste Digester Services. Through our Recoup Technologies subsidiary, we are a leading provider of an innovative clean technology that was designed to solve the U.S. trucking industry generated $676.2 billion in revenue in CY-2016, moving 70.6%increasingly-relevant issue of all domestic freight tonnage for a total of 10.42food waste disposal by combining waste disposal equipment with advanced data analytics. With approximately 2.5 billion tons of freight. As well,food wasted each year and over 97% of such waste being sent to landfills, food waste is a serious issue that has detrimental environmental and economic implications. Our solution has attracted the ATA projectedattention of leading corporations and governments around the world as they strive to reduce carbon emissions and measure environmental impact while realizing a compelling return on investment.

We currently market an aerobic digestion technology solution for the disposal of food waste at the point of generation. Our line of Revolution Series Digesters are self-contained, robotic digestive systems that goods hauledwe believe are as easy to install as a standard dishwasher with no special electrical or plumbing requirements. Units range in size depending upon capacity, with the smallest unit approximating the size of a residential washing machine. The digesters utilize a biological process to convert up to 1,400 pounds of food waste in a 24-hour period into a liquid that we believe is safe to discharge down an ordinary drain. This process can result in a substantial reduction in costs for customers including cruise lines, restaurants, retail stores, hospitals, hotel/hospitality companies and governmental units by truckeliminating the transportation and logistics costs associated with food waste disposal. We also expect the process to reduce the greenhouse gases associated with food-waste transportation and decomposition in landfills that have been linked to climate change. We offer our Revolution Series Digesters in several sizes targeting small- to mid-sized food waste generation sites that are often more economical than traditional disposal methods. We also offer the microorganisms that are used with the digesters in the biological conversion process. The microorganisms are typically supplied on a monthly basis and are typically supplied for the life of the digester. Our Revolution Series Digesters are manufactured and assembled in the United States.

In an effort to expand the capabilities of our digesters, we offer a sophisticated Internet of Things (“IoT”) technology platform to provide our customers with transparency into their internal and supply chain waste generation and operational practices. This patented process collects weight-related data from the digesters to deliver real-time data that provides valuable information that when analyzed, can improve efficiency, and validate corporate sustainability efforts. We provide our IoT platform through a SaaS (“Software as a Service”) model that is either bundled in our rental agreements or sold through a separate quarterly or annual software license. We are considering adding new capacity sizes to our line of Revolution Series Digesters to meet customer needs.

Acquisition of Standard Waste Services, LLC

On January 12, 2024, we, through our wholly-owned subsidiary, Titan Trucking, entered into a Membership Interest Purchase Agreement (the “Purchase Agreement”) with Dominic Campo and Sharon Campo (each a “Seller” and collectively, the “Sellers”), and Standard Waste Services, LLC, a Michigan limited liability company (“Standard”), pursuant to which, and subject to the terms, provisions, and conditions set forth therein, at the closing of the transactions contemplated by the Purchase Agreement (the “Closing”), the Sellers will sell to Titan Trucking, and Titan Trucking will purchase from the Sellers, 100% of the outstanding membership interests of Standard (the “Membership Interests”).

Standard was founded in 2017 by Dominic Campo to provide contracted commercial roll-off and front-load waste services, including dumpster compactor rentals, to customers principally in the Southeast Michigan market. Standard currently operates approximately 20 waste collection trucks servicing approximately 1,000 commercial and industrial customers. With a pipeline of additional pending new customers, Standard is expected to growenable Titan Trucking to advance its commercial front-load segment by securing recurring revenue pursuant to multiyear contracts with its customers.

In connection with the Purchase Agreement, Titan Trucking paid to Sellers a cash deposit in the amount of $652,000 (the “Closing Deposit”) that is not refundable, but will reduce the Cash Consideration (as defined below) if the Closing occurs. In exchange for the Membership Interests, Titan Trucking will pay the following consideration (the “Purchase Price”): (a) $10,440,000 in cash (the “Cash Consideration”), less the Closing Deposit; provided, that, at the Closing, $300,000 of the Cash Consideration will be placed in escrow for the benefit of Titan Trucking to satisfy indemnification obligations of the Sellers; (b) an amount equal to the aggregate amount paid by Standard for purchases of new trucks and trailers for the period from June 7, 2023 through the date of the Closing (the “Closing Date”) in an amount not to exceed $533,000; (c) 273,684.21 shares of a three percent rateseries of our convertible preferred stock that will convert into 100 shares of common stock per share of convertible preferred stock, equal to a value of $2,610,000, (the “Investment Shares”); and (d) an additional 60,000 Investment Shares because the Closing did not occur prior to February 2, 2024. In addition, the Purchase Price shall be reduced by the amount of indebtedness of Standard as of the Closing Date and the amount of any fees and expenses of Standard or the Sellers related to the negotiation and entry into the Purchase Agreement that are not paid prior to the Closing. The Purchase Price is also subject to adjustment post-Closing based on the amount of working capital of Standard at the Closing and other adjustments as described in the Purchase Agreement.

We currently expect the Closing to occur in the second quarter of 2024, subject to applicable customary conditions for Closing for each of Titan Trucking and the Sellers contained in the Purchase Agreement. However, there can be no assurance that the Closing will occur or that we will acquire the Membership Interests.

Sales and Marketing

We focus our marketing efforts on increasing and extending business with existing customers, as well as increasing our new customer base. Our sales and marketing strategy is to provide prompt, high quality, comprehensive solid waste collection to our customers at competitive prices. We target potential customers of all sizes, from small quantity generators to large companies and municipalities. Because the waste collection and disposal business is a highly-localized business, most of our marketing activity is local in nature.

Customers

We have a diverse customer base. During the year ended December 31, 2023, our largest customer accounted for approximately 30% of our revenues. During the year ended December 31, 2022, we had two customers that accounted for 52% and 12% of our revenues, respectively. No other customer accounted for more than 10% of our revenues in either of those periods. We have no long-term agreements with any of the customers that accounted for more than 10% of our revenues in any of those periods.

Competition

The U.S. solid waste collection and disposal industry is highly competitive and, even following consolidation, remains fragmented. The industry requires substantial labor and capital resources which are barriers to entry for some. The industry presently includes large, publicly-held, national waste companies such as Republic Services, Inc. and Waste Management, Inc.; several regional, publicly-held and privately-owned companies; and several thousand small, local, privately owned companies. Our existing market and certain of the markets in which we will likely compete are served by one or more of these large, national companies, as well as by numerous privately-held regional and local solid waste companies of varying sizes and resources, some of which have accumulated substantial goodwill in their markets. We also compete with counties, municipalities and solid waste districts that maintain their own waste collection and disposal operations. Public sector operations may have financial advantages over us because of their access to user fees and similar charges, tax revenues, tax-exempt financing and the next five years. Although truck shippingability to flow-control waste streams to publicly owned disposal facilities.

We compete for collection based primarily on geographic location and the price and quality of our services. From time to time, our competitors may reduce the price of their services in an effort to expand their market share or service areas or to win competitively bid on contracts. These practices may cause us to reduce the price of our services or, if we elect not to do so, to lose business.

The U.S. municipal solid waste services industry has undergone significant consolidation and, as a result of this consolidation, we encounter competition in our efforts to acquire transfer stations and collection operations. Competition exists not only for collection, transfer and disposal volume but also for acquisition candidates. We generally compete for acquisition candidates with large, publicly-held waste management companies, private equity-backed firms as well as numerous privately-held regional and local solid waste companies of varying sizes and resources. Accordingly, it may become uneconomical for us to make further acquisitions or we may be unable to locate or acquire suitable acquisition candidates at price levels and on terms and conditions that we consider appropriate, particularly in markets we do not already serve. Competition in the disposal industry is also affected by the increasing national emphasis on recycling and other waste reduction programs, which may reduce the volume of waste deposited in landfills.

Regulation

Our business is subject to extensive and evolving federal, state and local environmental, health, safety and transportation laws and regulations. These laws and regulations are administered by the U.S. Environmental Protection Agency, or EPA, and various other federal, state and local environmental, zoning, air, water, transportation, land use, health and safety agencies. Many of these agencies regularly inspect our operations to monitor compliance with these laws and regulations. Governmental agencies have the authority to enforce compliance with these laws and regulations and to obtain injunctions or impose civil or criminal penalties in cases of violations. We believe that regulation of the waste industry will continue to remainevolve, and we will need to adapt to future legal and regulatory requirements to ensure compliance.

Our operations are subject to extensive regulation, principally under the dominant carrierfederal statutes described below.

The Occupational Safety and Health Act of 1970, as amended, or OSHA. OSHA establishes certain employer responsibilities, including maintenance of a workplace free of recognized hazards likely to cause death or serious injury, compliance with standards promulgated by the Occupational Safety and Health Administration and various record keeping, disclosure and procedural requirements. Various standards, including standards for freight, with more than 10.5 billion tonsnotices of freight moved per year, air, maritime,hazards, safety in excavation and rail travel are also seeing increased numbers. Truck shipping rates have been rising by as much as 4% annually,demolition work and the forecasthandling of asbestos, may apply to our operations.

Flow Control/Interstate Waste Restrictions. Certain permits and approvals, as well as certain state and local regulations, may limit a landfill or transfer station to accepting waste that originates from specified geographic areas, restrict the importation of out-of-state waste or wastes originating outside the local jurisdiction or otherwise discriminate against non-local waste. From time to time, federal legislation is proposed that would allow some local flow control restrictions. Although no such federal legislation has been enacted to date, if such federal legislation should be enacted in the future, states in which we use landfills could limit or prohibit the importation of out-of-state waste or direct that wastes be handled at specified facilities. These restrictions could also result in higher disposal costs for our collection operations. If we were unable to pass such higher costs through to our customers, our business, financial condition and operating results could be adversely affected.

State and Local Regulation. Each state in which we now operate or may operate in the future has laws and regulations governing the generation, storage, treatment, handling, transportation and disposal of solid waste, occupational safety and health, water and air pollution and, in most cases, the siting, design, operation, maintenance, closure and post-closure maintenance of landfills and transfer stations. State and local permits and approval for these ratesoperations may be required and may be subject to continue rising asperiodic renewal, modification or revocation by the demandissuing agencies. In addition, many states have adopted statutes comparable to, and in some cases more stringent than, the Comprehensive Environmental Response, Compensation, and Liability Act, or CERCLA. These statutes impose requirements for truck shippinginvestigation and cleanup of contaminated sites and liability for costs and damages associated with such sites, and some provide for the imposition of liens on property owned by responsible parties. Furthermore, many municipalities also have ordinances, local laws and regulations affecting our operations. These include zoning and health measures that limit solid waste management activities to specified sites or activities, flow control provisions that direct or restrict the delivery of solid wastes to specific facilities, laws that grant the right to establish franchises for collection services increases.and then put such franchises out for bid and bans or other restrictions on the movement of solid wastes into a municipality.

Certain state and local jurisdictions may also seek to enforce flow control restrictions through local legislation or contractually. In certain cases, we may elect not to challenge such restrictions. These restrictions could reduce the volume of waste going to landfills in certain areas, which may adversely affect our ability to operate our landfills at their full capacity and/or reduce the prices that we can charge for landfill disposal services. These restrictions may also result in higher disposal costs for our collection operations. If we were unable to pass such higher costs through to our customers, our business, financial condition and operating results could be adversely affected.

TransportIQ, is long haul trucking carrier business that comprises contract drivers

There has been an increasing trend at the state and owner operators. TransportIQ’s customers include leading third-party logisticslocal level to mandate and supply chain management providersencourage waste reduction and recycling and to prohibit or restrict the disposal in landfills of certain types of solid wastes, such as C.H. Robinsonconstruction and PAM Transport, Inc.demolition debris, yard wastes, food waste, beverage containers, unshredded tires, lead-acid batteries, paper, cardboard and household appliances.

TransportIQ launched its business with owner operatorsMany states and local jurisdictions have enacted “bad boy” laws that allow the agencies that have jurisdiction over waste services contracts or permits to deny or revoke these contracts or permits based on the applicant’s or permit holder’s compliance history. Some states and local jurisdictions go further and consider the compliance history of the parent, subsidiaries or affiliated companies, in addition to that of the applicant or permit holder. These laws authorize the agencies to make determinations of an applicant’s or permit holder’s fitness to be awarded a contract to operate and to deny or revoke a contract or permit because of unfitness unless there is a showing that the applicant or permit holder has begun to hire drivers, thereby improving gross profits and service reliability. It plans to grow its operations by incrementally adding new third-party logistics and supply chain management customers, owner operators, and contract drivers.

TransportIQ plans to differentiate itself from traditional carriersbeen rehabilitated through the adoption of new technologiesvarious operating policies and procedures put in place to assure future compliance with applicable laws and regulations.

Some state and local authorities enforce certain federal laws in addition to state and local laws and regulations. For example, in some states, the Resource Conservation and Recovery Act, or RCRA, OSHA, parts of the Clean Air Act and parts of the Clean Water Act are enforced by local or state authorities instead of the EPA, and in some states those laws are enforced jointly by state or local and federal authorities.

Public Utility Regulation. In many states, public authorities regulate the rates that landfill operators may charge.

Seasonality

Based on our industry and our historic trends, we expect our operations to vary seasonally. Typically, revenue will be highest in the second and third calendar quarters and lowest in the first and fourth calendar quarters. These seasonal variations result in fluctuations in waste volumes due to weather conditions and general economic activity. We also expect that our operating expenses may be higher during the winter months due to periodic adverse weather conditions that can help TransportIQslow the collection of waste, resulting in higher labor and operational costs.

Employees

As of December 31, 2023, we had approximately 39 full-time employees, of whom 23 were employed in collection, transfer and disposal operations, 12 in clerical, administrative and sales positions and four in management. None of our employees is represented by a labor union. We have not experienced any work stoppages and we believe that our relations with our employees are good.

The safety of our employees and customers is extremely important to us and we have a strong track record of safety and environmental compliance. We constantly review and assess our policies practices and procedures in order to create competitive advantages ina safer work environment for our employees and to reduce the transportation industry. The first step will be integrating OmniM2M’s Industrial Internetfrequency of Things (IIoT) tracking devices into van trailers for monitoring and reporting location, weight, and temperature of loads.workplace injuries.

Item 1A. Risk Factors

Risk Factors Related to Our Business

An investmentInvesting in our securities involves a high degree of risk. You should not invest in our securities if you cannot afford to lose your entire investment. In deciding whether you should invest in our securities, you should carefully consider the following information about these risks, together with all of the other information containedappearing elsewhere in this Current Report. Anyreport, including our financial statements, the notes thereto and the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” before deciding to invest in our securities. The occurrence of any of the following risk factors can causerisks could have a material and adverse effect on our business, prospects,reputation, financial condition, or results of operations and future growth prospects, as well as our ability to sufferaccomplish our strategic objectives. As a result, the trading price of our securities could decline, and you tocould lose all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations and stock price.

General Risks RelatingRelated to Our Finances and Business OperationsPlan

Since our recent transition to an environmental solutions company in January 2023, we lack an established operating history on which to evaluate our consolidated business and determine if we will be able to execute our business plan, and we can give no assurance that our operations will result in profits.

While we have conducted business operations since 2017, we commenced the transition to an environmental solutions company in January 2023 and consummated the acquisition of Financial Condition

Weour Titan Trucking subsidiary and its various lines of business in May 2023. As a result, we have a limited operating history as a consolidated company upon which you may evaluate our business and prospects. Our business operations are subject to thenumerous risks, encountered by early-stage companies.

Because our operating company has a limited operating history, youuncertainties, expenses and difficulties associated with early stage enterprises. You should consider and evaluatean investment in our operating prospectscompany in light of these risks, uncertainties, expenses and difficulties. Such risks include:

Because we are subject to these risks, and uncertainties frequently encountered by early-stage companiesthe other risks discussed below, you may have a difficult time evaluating our business and your investment in rapidly evolving markets. Forour company.

We have had a history of losses and may incur future losses, which may prevent us these risks include:from attaining profitability.

● risksWe have incurred significant net losses since inception. Our net loss was approximately $149.0 million (of which $142.5 million related to non-cash transactions, including $5.6 million in stock-based compensation, $20.4 million in goodwill impairment, and $116.6 million in loss on extinguishment and issuance of share rights) and $0.7 million for the years ended December 31, 2023 and 2022, respectively. As of December 31, 2023, we had an accumulated deficit of approximately $150.0 million. We may continue to incur significant losses in the future for a number of reasons, including unforeseen expenses, difficulties, complications, delays, and other unknown events.

We anticipate that our operating expenses will increase substantially in the foreseeable future as we undertake the acquisition and integration of additional entities and businesses, incur expenses associated with maintaining compliance as a public company, and increase marketing and sales efforts to increase our customer base. These increased expenditures may make it more difficult to achieve and maintain profitability. In addition, our efforts to grow our business may be more expensive than we expect, and we may not havebe able to generate sufficient capitalrevenue to achieveoffset increased operating expenses. If we are required to reduce our expenses, our growth strategy;

● risks thatstrategy could be materially affected. We will need to generate and sustain significant revenue levels in future periods in order to become profitable, and, even if we do, we may not be able to maintain or increase our level of profitability.

Accordingly, we cannot assure you that we will achieve sustainable operating profits as we continue to expand our markets, service offerings and infrastructure, further develop our productmarketing efforts, and service offerings in a manner that enables us to be profitable and meet our customers’ requirements;

● risks thatotherwise implement our growth strategy may not be successful;initiatives. Any failure to achieve and

● risks that fluctuations in our operating results will be significant relative to our revenues.

These risks are described in more detail below. Our future growth will depend substantially maintain profitability would have a materially adverse effect on our ability to address theseimplement our business plan, our results and operations, and our financial condition.

If we are unable to obtain additional funding when needed, our business operations will be harmed, and if we do obtain additional financing, our then-existing shareholders may suffer substantial dilution.

As we take steps to grow our business through additional acquisitions, by entering into new markets or by expanding our service offerings, or as we respond to potential opportunities and/or adverse events, our working capital needs may change. We anticipate that if our cash are insufficient to satisfy our liquidity requirements, we will require additional funding to sustain our ongoing operations and to continue our expansion strategies. We do not have any contracts or commitments for additional funding, and there can be no assurance that financing will be available in amounts or on terms acceptable to us, if at all, if needed. The inability to obtain additional capital will restrict our ability to grow and may reduce our ability to conduct business operations. If we are unable to obtain additional financing to finance a revised growth plan, we will likely be required to curtail such plans or cease our business operations in one or more markets. Any additional equity financing may involve substantial dilution to our then existing shareholders.

Raising capital in the future could cause dilution to our existing shareholders and may restrict our operations or require us to relinquish rights.

In the future, we may seek additional capital through a combination of private and public equity offerings, debt financings and collaborations and strategic and licensing arrangements. To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership interest will be diluted, and the terms may include liquidation or other risks describedpreferences that adversely affect your rights as a shareholder. Debt financing, if available, would result in this section. increased fixed payment obligations and may involve agreements that include covenants limiting or restricting our ability to take specific actions such as incurring debt, making capital expenditures or declaring dividends. If we raise additional funds through collaboration or strategic alliance arrangements with third parties, we may have to relinquish valuable rights to our future revenue streams or product candidates on terms that are not favorable to us.

If we do not successfully address these risks,obtain adequate capital funding or improve our business wouldfinancial performance, we may not be significantly harmed.able to continue as a going concern.

Our operatingWe have incurred a net loss in each year since our inception and expect to incur losses in future periods as we continue to acquire additional waste management companies and working capital deficiencyincrease our expenses in order to grow our business. These factors raise substantial doubt about our ability to continue as a going concern. If we doare unable to obtain adequate funding or if we are unable to grow our revenue substantially to achieve and sustain profitability, we may not be able to continue as a going concern, investors could lose their entire investment.

Our operating losses and working capital deficiency raiseconcern. The report of our independent registered public accounting firm for the year ended December 31, 2023 included herein contains an explanatory paragraph indicating that there is substantial doubt aboutas to our ability to continue as a going concern. If we do not generate revenues, do not achieve profitability and do not have other sourcesconcern as a result of financing for our business, we may have to curtail or cease our development plans and operations, which could cause investors to lose the entire amount of their investment.recurring losses from operations.

If we are unable to manage our anticipated post-Share Exchange Agreement growth effectively, our business couldraise additional capital when required or on acceptable terms, we may be adversely affected.

We anticipate that a significant expansion ofrequired to significantly delay, scale back or restrict our operations and addition of operating subsidiaries, including one in the United States, and new personnel will be required in all areas of our operations in order to implement our post-Share Exchange business plan. Our future operating results depend to a large extentacquisition program or obtain funds by entering into agreements on our ability to manage this expansion and growth successfully. For us to continue to manage such growth, we must put in place legal and accounting systems, and implement human resource management and other tools. We have taken preliminary steps to put this structure in place. However, there is no assurance that we will be able to successfully manage this anticipated rapid growth. A failure to manage our growth effectively could materially and adversely affect our ability to market our crowd funding platform in multiple venues.

Increasing competition within our emerging industry could have an impact on our business prospects.

The IIoT market is an emerging industry where new competitors are entering the market frequently. These competing companies may have significantly greater financial and other resources than we have and may have been developing their products and services longer than we have been developing ours. Although we anticipate that our portfolio of products and related revenue stream sources are broad, increasing competition may have a negative impact on our profit margins.

Our business is subject to risks generally associated with fluctuating economic tendencies in the capital markets.

The demand for our products can change over time due to fluctuations in the global and local economies and in the related capital requirements of small and medium-sized enterprises. These fluctuations could negatively impact our future revenue streams.

We may not be able to adequately protect our proprietary technology, and our competitors may be able to offer similar products and services,unattractive terms, which would harm our competitive position.

Our success depends in part upon our proprietary technology. We rely primarily on trademark, copyright, service mark and trade secret laws, confidentiality procedures, license agreements and contractual provisions to establish and protect our proprietary rights. Despite these precautions, third parties could copy or otherwise obtain and use our technology without authorization, or develop similar technology independently. We also pursue the registration of our domain names, trademarks, and service marks in the United States. We cannot assure you that the protection of our proprietary rights will be adequate or that our competitors will not independently develop similar technology, duplicate our products and services or design around any intellectual property rights we hold.

If third parties claim that we infringe their intellectual property, it may result in costly litigation.

We cannot assure you that third parties will not claim our current or future products infringe their intellectual property rights. Any such claims, with or without merit, could cause costly litigation that could consume significant management time. As the number of product and services offerings in the crowd funding market increases and functionalities increasingly overlap, companies such as ours may become increasingly subject to infringement claims. Such claims also might require us to enter into royalty or license agreements. If required, we may not be able to obtain such royalty or license agreements, or obtain them on terms acceptable to us.

We may need additional financing. Any limitation on our ability to obtain such additional financing couldlikely have a material adverse effect on our business, stock price and our relationships with third parties with whom we have business relationships, at least until additional funding is obtained. If we do not have sufficient funds to continue operations, we could be required to seek bankruptcy protection or other alternatives that would likely result in our stockholders losing some or all of their investment in us. In addition, our ability to achieve profitability or to respond to competitive pressures would be significantly limited.

The amount and timing of our future funding requirements depends on many factors, including

We cannot be certain that additional funding will be available on acceptable terms, or at all. In addition, we have in the past and may in the future be restricted or limited by the terms of the credit facilities governing our indebtedness on our ability to enter into additional indebtedness and any future debt financing based upon covenants that restrict our operations, including limitations on our ability to incur liens or additional debt, pay dividends, redeem our stock, make certain investments and engage in certain merger, consolidation or asset sale transactions.

We have a holding company ownership structure and will depend on distributions from our operating subsidiaries to meet our obligations. Contractual or legal restrictions applicable to our subsidiaries could limit payments or distributions from them.

We are a holding company and derive all of our operating income from, and hold substantially all of our assets through, our subsidiaries. The effect of this structure is that we will depend on the earnings of our subsidiaries, and the payment or other distributions to us of these earnings, to meet our obligations and make capital expenditures. Provisions of U.S. corporate and tax law, like those requiring that dividends are paid only out of surplus, and provisions of any future indebtedness may limit the ability of our subsidiaries to make payments or other distributions to us. Additionally, in the event of the liquidation, dissolution or winding up of any of our subsidiaries, creditors of that subsidiary (including trade creditors) will generally be entitled to payment from the assets of that subsidiary before those assets can be distributed to us.

Substantially all of our assets are pledged to Michaelson under the Michaelson Note, a default under which could cause or liquidation. Additionally, the terms of the Michaelson Note place restrictions on our operating and financial conditionflexibility. If we raise additional capital through debt financing, the terms of any new debt could further restrict our ability to operate our business.

On January 5, 2023, we completed the acquisition of our digester assets, and as part of the consideration we paid for such assets, we assumed the obligations of the seller under a secured loan agreement (the “Loan Agreement”) with Michaelson Capital Special Finance Fund II, L.P. (“Michaelson”) and the Secured Promissory Note in the then-outstanding amount of $3,017,090 (the “Michaelson Note”) issued to Michaelson thereunder. The Michaelson Note had an original maturity date of December 31, 2023, which in December 2023 was extended to March 31, 2024. We failed to pay the balance on March 31, 2024, but in April 2024, we agreed to extend the term of the Michaelson Note until June 30, 2024, and received a forbearance on all other defaults until May 1, 2024. Substantially all of our assets are pledged as collateral for outstanding borrowings under the Michaelson Note and our other obligations under the Loan Agreement. The Loan Agreement contains usual and customary restrictive covenants that, among other things, limit our ability to incur additional indebtedness, pay cash dividends or repurchase our stock, and merge or consolidate with another entity. These covenants could cause us to be unable to pursue business opportunities that we or our stockholders may consider beneficial. Upon an event of default under the Michaelson Note, including our failure to pay all outstanding amounts under the Michaelson Note on the maturity date, Michaelson may accelerate all of our repayment obligations and foreclose on our pledged assets, which could require us to renegotiate the Loan Agreement on terms less favorable to us or to immediately cease operations. Further, if our assets are liquidated upon foreclosure, Michaelson’s right to repayment would be senior to the rights of the holders of our capital stock to receive any proceeds from the liquidation. If we raise any additional debt financing, the terms of such additional debt could further restrict our operating and financial flexibility.

Our lack of an independent audit committee and audit committee financial expert at this time may hinder our board of directors’ effectiveness in monitoring our compliance with its disclosure and accounting obligations. Until we establish such committee, we will be unable to obtain a listing on a national securities exchange.

Although our common stock is not listed on any national securities exchange, for purposes of independence we use the definition of independence applied by the NYSE American. Currently, we have no independent audit committee. Our board of directors functions as our audit committee and is comprised of five directors. An independent audit committee would play a crucial role in the corporate governance process, assessing our processes relating to our risks and control environment, overseeing financial reporting, and evaluating internal and independent audit processes. The lack of an independent audit committee may deprive us of management’s independent judgment. We may, however, have difficulty attracting and retaining independent directors with the requisite qualifications. If we are unable to attract and retain qualified, independent directors, the management of our business could be compromised. An independent audit committee is required for listing on any national securities exchange. Therefore, until such time as we meet the audit committee independence requirements of a national securities exchange, we will be ineligible for listing on any national securities exchange.

Our board of directors acts as our compensation committee, which presents the risk that compensation and benefits paid to those executive officers who are board members and other officers may not be commensurate with our financial performance.

A compensation committee consisting of independent directors is a safeguard against self-dealing by company executives. Our board of directors, which has no independent members, acts as the compensation committee for our company and determines the compensation and benefits of our executive officers, administers our employee stock and benefit plans, and reviews policies relating to the compensation and benefits of our employees. Our lack of an independent compensation committee presents the risk that an executive officer on the board may have influence over his or her personal compensation and benefit levels that may not be commensurate with our financial performance or the market place.

Risks Related to Our Acquisition Strategy

We have made and expect to continue to make acquisitions as a primary component of our growth strategy. We may not be able to identify suitable acquisition candidates or consummate acquisitions on acceptable terms, or at all, which could disrupt our operations and adversely impact our business and operating results.

A primary component of our growth strategy has been to acquire complementary businesses to grow our company. As a result, our rate of future growth and profitability is largely dependent on our ability to identify and acquire additional solid waste collection, transportation, and disposal businesses. We intend to continue to pursue acquisitions of complementary businesses, technologies and products to expand our operations and customer base and provide access to new markets and increase benefits of scale. This strategy involves risks inherent in assessing the values, strengths, weaknesses, risks, and profitability of acquisition candidates, including adverse short-term effects on our reported operating results, diversion of management’s attention, dependence on retaining, hiring and training key personnel, and risks associated with unanticipated problems or latent liabilities. Acquisitions also involve certain known and unknown risks that could cause our actual growth or operating results to differ from our expectations. For example:

Increased competition for acquisition targets in our industry may affect the availability of acquisition targets, which could adversely affect our growth.

Increased competition for acquisition candidates may result in fewer acquisition opportunities being made available to us as well as less advantageous acquisition terms, which may increase acquisition costs to levels that are beyond our financial capability or that may have an adverse effect on our business and results of operations.

Although we expect Accordingly, no assurance can be given as to the number or timing of our acquisitions or as to the availability of financing necessary to complete an acquisition. We also believe that the proceeds from the Offeringa significant factor in our ability to consummate acquisitions will be the attractiveness of our common stock as an investment to potential acquisition candidates. Such attractiveness may, in large part, be dependent upon the market price and capital appreciation prospects of our common stock compared to the equity securities of our competitors. Many of our competitors for acquisitions are larger, more established companies with significantly greater capital resources than us and whose equity securities may be more attractive than our common stock. To the extent our common stock is less attractive to acquisition candidates, our acquisition program may be adversely affected.

Our ability to acquire additional businesses may require us to raise capital through the sale of equity and/or debt securities, which we may be unable to do on acceptable terms.

The timing, size and success of our acquisition efforts and the associated capital commitments cannot be readily predicted. We intend to use our common stock, cash, debt and borrowings under our credit facility, if necessary, as consideration for future acquisitions of companies. The issuance of additional common stock in connection with future acquisitions may be dilutive to holders of outstanding shares of common stock. In addition, if our common stock does not maintain a sufficient market value or potential acquisition candidates are unwilling to implementaccept common stock as part of the consideration for the sale of their businesses, we may be required to use more of our business plan,cash resources, including obtaining additional capital through debt financing. However, there can be no assurance that we will not require additional capital. The raising of additional capital could result in dilution to our stockholders. In addition, there is no assurance that we will be able to obtain additional capitalfinancing if we needand when it is needed or that if available, it will be available on terms that we deem acceptable. If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate some or all of our research and development programs or commercialization efforts. As a result, we may be unable to pursue our acquisition strategy successfully, which may prevent us from achieving our growth objectives.

We may be unable to successfully integrate acquisitions, which may adversely impact our operations.

Acquired businesses, technologies or products may not perform as we expect and we may fail to realize anticipated revenue and profits. In addition, our acquisition strategy may divert management’s attention away from our existing business, resulting in the loss of key customers or employees, and expose us to unanticipated problems or legal liabilities, including responsibility as a successor for undisclosed or contingent liabilities of acquired businesses or assets.

If we fail to conduct due diligence on our potential targets effectively, we may, for example, not identify problems at target companies or fail to recognize incompatibilities or other obstacles to successful integration. Our inability to successfully integrate future acquisitions could impede us from realizing all of the benefits of those acquisitions and could severely weaken our business operations. The integration process may disrupt our business and, if new businesses, technologies or products are not integrated or implemented effectively, may preclude the realization of the full benefits expected by us and could harm our results of operations. In addition, the overall integration of new technologies, products or businesses may result in unanticipated problems, expenses, liabilities and competitive responses. The difficulties integrating an acquisition include, among other things:

In addition, even if the operations of an acquisition are integrated successfully, we may not realize the full benefits of the acquisition, including the synergies, cost savings or growth opportunities, that we expect. These benefits may not be achieved within the anticipated time frame, or at all.

Acquisitions that we complete may have an adverse impact on our results of operations.

Acquisitions may cause us to:

The occurrence of any or all of the above risks could materially and adversely affect our business, operating results and financial condition.

We may be subject to claims arising from the operations of our various businesses for periods prior to the dates we acquired them.

We may be subject to claims or liabilities arising from the ownership or operation of acquired businesses for the periods prior to our acquisition of them, including environmental, warranty, workers’ compensation and other employee-related and other liabilities and claims not covered by insurance. These claims or liabilities could be significant. Our ability to seek indemnification from the former owners of our acquired businesses for these claims or liabilities may be limited by various factors, including the specific time, monetary or other limitations contained in the respective acquisition agreements and the financial ability of the former owners to satisfy our indemnification claims. In addition, insurance companies may be unwilling to cover claims that have arisen from acquired businesses or locations, or claims may exceed the coverage limits that our acquired businesses had in effect prior to the date of acquisition. If we are unable to successfully obtain insurance coverage of third-party claims or enforce our indemnification rights against the former owners, or if the former owners are unable to satisfy their obligations for any reason, including because of their current financial position, we could be held liable for the costs or obligations associated with such claims or liabilities, which could adversely affect our financial condition and results of operations.

Our resources may not be sufficient to manage our expected growth and the failure to properly manage our potential growth would be detrimental to our business.

We may fail to adequately manage our anticipated future growth. Any growth in our operations will place a significant strain on our administrative, financial and operational resources and increase demands on our management and on our operational and administrative systems, controls and other resources. We cannot assure you that our existing personnel, systems, procedures or controls will be adequate to support our operations in the future or that we will be able to successfully implement appropriate measures consistent with our growth strategy. As part of this growth, we may have to implement new operational and financial systems, procedures and controls to expand, train and manage our employee base, and maintain close coordination among our technical, accounting, finance, marketing and sales. We cannot guarantee that we will be able to do so, or that if we are able to do so, we will be able to effectively integrate them into our existing staff and systems. There may be greater strain on our systems as we acquire new businesses, requiring us to devote significant management time and expense to the ongoing integration and alignment of management, systems, controls and marketing. If we are unable to manage growth effectively, such as if our sales and marketing efforts exceed our capacity to design and produce our products and services or if new employees are unable to achieve performance levels, our business, operating results and financial condition could be materially and adversely affected.

Risks Related to our Business and Industry

We are subject to environmental and safety laws that restrict our operations and increase our costs.

We are subject to extensive federal, state and local laws and regulations relating to environmental protection and occupational safety and health. These include, among other things, laws and regulations governing the use, treatment, storage and disposal of wastes and materials, air quality, water quality and the remediation of contamination associated with the release of hazardous substances. Our compliance with existing regulatory requirements is costly, and continued changes in these regulations could increase our compliance costs. Government laws and regulations often require us to enhance or replace our equipment. We are required to obtain and maintain permits that are subject to strict regulatory requirements and are difficult and costly to obtain and maintain. We may be unable to implement price increases sufficient to offset the cost of complying with these laws and regulations. In addition, regulatory changes could accelerate or increase expenditures for closure and post-closure monitoring at solid waste facilities and obligate us to spend sums over the amounts that we have accrued. In order to develop, expand or operate a landfill or other waste management facility, we must have various facility permits and other governmental approvals, including those relating to zoning, environmental protection and land use. The permits and approvals are often difficult, time consuming and costly to obtain and could contain conditions that limit our operations.

We may become subject to environmental clean-up costs or litigation that could curtail our business operations and materially decrease our earnings.

The Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, or CERCLA, and analogous state laws provide for the remediation of contaminated facilities and impose strict joint and several liability for remediation costs on current and former owners or operators of a facility at which there has been a release or a threatened release of a hazardous substance. This liability is also imposed on persons who arrange for the disposal of and who transport such substances to the facility. Hundreds of substances are defined as hazardous under CERCLA and their presence, even in small amounts, can result in substantial liability. The expense of conducting a cleanup can be significant. Notwithstanding our efforts to comply with applicable regulations and to avoid transporting and receiving hazardous substances, we may have liability because these substances may be present in waste collected by us. The actual costs for these liabilities could be significantly greater than the amounts that we might be required to accrue on our financial statements from time to time.

In addition to the costs of complying with environmental regulations, we may incur costs to defend against litigation brought by government agencies and private parties. As a result, we may be required to pay fines or our permits and licenses may be modified or revoked. We may in the future be a defendant in lawsuits brought by governmental agencies and private parties who assert claims alleging environmental damage, personal injury, property damage and/or violations of permits and licenses by us. A significant judgment against us, the loss of a significant permit or license or the imposition of a significant fine could curtail our business operations and may decrease our earnings.

Our business is capital intensive, requiring ongoing cash outlays that may strain or consume our available capital and force us to sell assets, incur debt, or sell equity on unfavorable terms.

Our ability to remain competitive, grow and maintain our operations largely depends on our cash flow from operations and access to capital. Maintaining our existing operations and expanding them through internal growth or acquisitions requires large capital expenditures. As we undertake more acquisitions and further expand our operations, the amount we expend on capital will increase. These increases in expenditures may result in lower levels of working capital or require us to finance working capital deficits. We intend to continue to fund our cash needs through cash flow from operations, equity and debt financings and borrowings under our credit facility, if necessary. However, we may require additional equity or debt financing to fund our growth.

We do not have complete control over our future performance because it is subject to general economic, political, financial, competitive, legislative, regulatory and other factors. It is possible that our business may not generate sufficient cash flow from operations, and we may not otherwise have the capital resources, to allow us to make necessary capital expenditures. If this occurs, we may have to sell assets, restructure our debt or obtain additional equity capital, which could be dilutive to our stockholders. We may not be able to take any of the foregoing actions, and we may not be able to do so on terms favorable to us or our stockholders.

Our business operations are currently concentrated in the State of Michigan and such geographic concentration of our business could adversely affect our business and financial condition.

Our business operations and customers are located in Michigan, and we expect to focus our operations on favorablethe Midwestern U.S. for at least the foreseeable future. During the year ended December 31, 2023, approximately 84% of our total annualized revenues were derived from customers located in Michigan. Therefore, our business, financial condition and results of operations are susceptible to downturns in the general economy in the Midwestern U.S., particularly in Michigan, and other factors affecting the region, such as state regulations affecting the solid waste services industry and severe weather conditions. In addition, the costs and time involved in permitting, and the scarcity of, available landfills in the Midwestern U.S. could make it difficult for us to expand vertically in those markets. There can be no assurance that we will complete a sufficient number of acquisitions in other markets to lessen our geographic concentration.

We currently depend on a limited number of customers for our revenue.

During the year ended December 31, 2023, one customer accounted for approximately 30% of total revenues generated and during the year ended December 31, 2022, two customers accounted for approximately 52% and 12%, respectively, of total revenues generated. We have no long-term agreements with any of the customers that accounted for more than 10% of our revenues in any of those periods.

Because we depend on these customers for a significant percentage of our revenue, a loss of one or reasonable terms.more of these customers could materially adversely affect our business and financial condition. If these principal customers cease using our services, our business could be materially adversely affected.

Governmental authorities may enact climate change regulations that could increase our costs to operate.

Environmental advocacy groups and regulatory agencies in the United States have been focusing considerable attention on the emissions of greenhouse gases and their potential role in climate change. Congress has considered recent proposed legislation directed at reducing greenhouse gas emissions and President Biden has indicated his support of legislation aimed at reducing greenhouse gases. The U.S. Environmental Protection Agency (the “EPA”) has proposed rules to regulate greenhouse gases, regional initiatives have formed to control greenhouse gases and certain of the states in which we operate are contemplating air pollution control regulations that are more stringent than existing and proposed federal regulations, in particular the regulation of emissions of greenhouse gases. The adoption of laws and regulations to implement controls of greenhouse gases, including the imposition of fees or taxes, could adversely affect our collection operations. Changing environmental regulations could require us to take any number of actions, including the purchase of emission allowances or installation of additional pollution control technology, and could make some operations less profitable, which could adversely affect our results of operations.

Our operations are subject to environmental, health and safety laws and regulations, as well as contractual obligations that may result in significant liabilities.

We risk incurring significant environmental liabilities in connection with our use, treatment, storage, transfer and disposal of waste materials. Under applicable environmental laws and regulations, we could be liable if our operations are found to cause environmental damage to our properties or to the property of other landowners, particularly as a result of the contamination of air, drinking water or soil. Under current law, we could also be held liable for damage caused by conditions that existed before we acquired the assets or operations involved. This risk is of particular concern as we execute our growth strategy, partially though acquisitions, because we may be unsuccessful in identifying and assessing potential liabilities during our due diligence investigations. Further, the counterparties in such transactions may be unable to perform their indemnification obligations owed to us. Additionally, we could be liable if we arrange for the transportation, disposal or treatment of hazardous substances that cause environmental contamination, or if a predecessor owner made such arrangements and, under applicable law, we are treated as a successor to the prior owner. Any limitation on our ability to obtain additional capital as and when neededsubstantial liability for environmental damage could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our business is subject to operational and safety risks, including the risk of personal injury to employees and others.

Providing environmental and waste management services involves risks such as vehicular accidents and equipment defects, malfunctions and failures. Additionally, there are risks associated with waste mass instability and releases of hazardous materials or odors. There may also be risks presented by the potential for subsurface chemical reactions causing elevated landfill temperatures and increased production of leachate, landfill gas and odors. Any of these risks could potentially result in injury or death of employees and others, a need to shut down or reduce operation of facilities, increased operating expense and exposure to liability for pollution and other environmental damage, and property damage or destruction.

While we seek to minimize our exposure to such risks through comprehensive training, compliance and response and recovery programs, as well as vehicle and equipment maintenance programs, if we were to incur substantial liabilities in excess of any applicable insurance, our business, results of operations and financial condition could be adversely affected. Any such incidents could also adversely impact our reputation and reduce the value of our brand. Additionally, a major operational failure, even if suffered by a competitor, may bring enhanced scrutiny and regulation of our industry, with a corresponding increase in operating expense.

Increases in the costs of fuel may reduce our operating margins.

The price and supply of fuel needed to run our collection vehicles is unpredictable and fluctuates based on events outside our control, including geopolitical developments, supply and demand for oil and gas, actions by the Organization of Petroleum Exporting Countries (OPEC) and other oil and gas producers, war and unrest in oil producing countries, regional production patterns and environmental concerns. Any significant price escalations or reductions in the supply could increase our operating expenses or interrupt or curtail our operations. Failure to offset all or a portion of any increased fuel costs through increased fees or charges would reduce our operating margins.

Increases in the costs of disposal may reduce our operating margins.

Historically, we have disposed of all of the waste that we collected in landfills operated by third parties under informal arrangements or without long-term contracts. If these third parties increase their disposal fees and we are unable to pass along the increase to our customers, our operating margins would be adversely impacted. In addition, if these third parties discontinue their arrangements with us and we are unable to locate alternative disposal sites, our business and results of operations.operations would be materially adversely affected.

If we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial statements could be impaired, which could harmIncreases in the costs of labor may reduce our operating results,margins.

We compete with other businesses in our abilitymarkets for qualified employees. A shortage of qualified employees would require us to operateenhance our businesswage and investors’ viewsbenefits packages to compete more effectively for employees or to hire more expensive temporary employees. Labor is our second largest operating cost, and even relatively small increases in labor costs per employee could materially affect our cost structure. Failure to attract and retain qualified employees, to control our labor costs, or to recover any increased labor costs through increased prices we charge for our services or otherwise offset such increases with cost savings in other areas may reduce our operating margins.

Increases in costs of us.insurance may reduce our operating margins.

Ensuring that we have adequate internal financialOne of our largest operating costs is maintaining insurance coverage, including general liability, automobile physical damage and accounting controlsliability, property, employment practices, pollution, directors and proceduresofficers, fiduciary, workers’ compensation and employer’s liability coverage, as well as umbrella liability policies to provide excess coverage over the underlying limits contained in place so that we can produce accurate financial statements onour primary general liability, automobile liability and employer’s liability policies. Changes in our operating experience, such as an increase in accidents or lawsuits or a timely basis is a costly and time-consuming effort that will needcatastrophic loss, could cause our insurance costs to increase significantly or could cause us to be evaluated frequently. Section 404 of the Sarbanes-Oxley Act requires public companiesunable to conduct an annual reviewobtain certain insurance. Increases in insurance costs would reduce our operating margins. Changes in our industry and evaluation of their internal controls. Our failure to maintain the effectiveness ofperceived risks in our internal controls in accordance with the requirements of the Sarbanes-Oxley Actbusiness could have a material adverse effect onsimilar effect.

We may not be able to maintain sufficient insurance coverage to cover the risks associated with our business. Weoperations, which could lose investor confidenceresult in the accuracy and completeness ofuninsured losses that would adversely affect our financial reports, which could have an adverse effect on the pricecondition.

Integrated non-hazardous waste companies are exposed to a variety of our common stock. In addition, if our efforts to comply with new or changed laws, regulations, and standards differ from the activities intendedrisks that are typically covered by regulatory or governing bodies due to ambiguities related to practice, regulatory authorities may initiate legal proceedings against us and our business may be harmed.

Risks Relating to our Securities

Because the common shares issued under the Share Exchange Agreement will result in a deemed a reverse acquisition,insurance arrangements. However, we may not be able to attractmaintain sufficient insurance coverage to cover the attentionrisks associated with our operations for a variety of major brokerage firms, whichreasons. Increases in insurance costs and changes in the insurance markets may, given our resources, limit the liquiditycoverage that we are able to maintain or prevent us from insuring against certain risks. Large or unexpected losses may exceed our policy limits, adversely affecting our results of operations, and may result in the termination or limitation of coverage, exposing us to uninsured losses, thereby adversely affecting our financial condition.

Our failure to remain competitive with our numerous competitors, many of whom have greater resources than we do, could adversely affect our ability to retain existing customers and obtain future business.

Because our industry is highly competitive, we compete with large companies and municipalities, many of whom have greater financial and operational resources than we do. The non-hazardous solid waste collection and disposal industry includes large national, publicly-traded waste management companies; regional, publicly-held and privately-owned companies; and numerous small, local, privately-owned companies. Additionally, many counties and municipalities operate their own waste collection and disposal facilities and have competitive advantages not available to private enterprises. If we are unable to successfully compete against our competitors, our ability to retain existing customers and obtain future business could be adversely affected.

We may lose contracts through competitive bidding, early termination or governmental action, or we may have to substantially lower prices in order to retain certain contracts, any of which would cause our revenue and our operating margins to decline.

We are parties to contracts with municipalities and other associations and agencies. Many of these contracts are or will be subject to competitive bidding. We may not be the successful bidder, or we may have to substantially lower prices in order to be the successful bidder. In addition, some of our Common Stockcustomers may terminate their contracts with us before the end of the contract term. If we were not able to replace revenue from contracts lost through competitive bidding or early termination or from lowering prices or from the renegotiation of existing contracts with other revenue within a reasonable time period, our revenue could decline.

Efforts by labor unions to organize our employees could divert management attention and increase our operating expenses.

We do not have any union representation in our operations. Groups of employees may make it more difficult for us to raise additional capitalseek union representation in the future.future, and the negotiation of collective bargaining agreements could divert management attention and result in increased operating expenses and lower net income. If we are unable to negotiate acceptable collective bargaining agreements, we might have to wait through “cooling off” periods, which are often followed by union-initiated work stoppages, including strikes. Depending on the type and duration of these work stoppages, our operating expenses could increase significantly.

Poor decisions by our regional and local managers could result in the loss of customers or an increase in costs, or adversely affect our ability to obtain future business.

Additional risks may exist becauseWe manage our operations on a decentralized basis. Therefore, regional and local managers have the Share Exchange will be considered a “reverse acquisition” under accounting and securities regulations. Certain SEC rulesauthority to make many decisions concerning their operations without obtaining prior approval from our executive officers. Poor decisions by regional or local managers could result in the loss of customers or an increase in costs, or adversely affect our ability to obtain future business.

We are vulnerable to factors affecting our local markets, which could adversely affect our stock price relative to our competitors.

Because the non-hazardous waste business is local in nature, our business in one or more restrictive when applied to reverse acquisition companies, such as the ability of stockholders to resell their shares of Common Stock pursuant to Rule 144. In addition, securities analysts of major brokerage firms may not provide coverage of our Common Stock following the Share Exchange because thereregions or local markets may be little incentive for brokerage firmsadversely affected by events and economic conditions relating to recommendthose regions or markets even if the purchaseother regions of our Common Stock.the country are not affected. As a result, our Common Stockfinancial performance may not compare favorably to our competitors with operations in other regions, and our stock price could be adversely affected by our inability to compete effectively with our competitors.

Seasonal fluctuations will cause our business and results of operations to vary among quarters, which could adversely affect our stock price.

Based on historic trends experienced by the businesses we have limited liquidity and investors may have difficulty selling it. In addition,acquired, we cannot assure you that brokerage firms will wantexpect our operating results to conduct any secondary offerings on our behalf if we seek to raise additional capitalvary seasonally, with revenue typically lowest in the future.first quarter, higher in the second and third quarters, and again lower in the fourth quarter. Our inabilityoperating revenues tend to raise additional capital may havebe somewhat higher in the summer months, primarily due to the higher construction and demolition waste volumes. This seasonality also generally reflects the lower volume of waste during the winter months. Adverse weather conditions negatively affect waste collection productivity, resulting in higher labor and operational costs. The general increase in precipitation during the winter months increases the weight of collected waste, resulting in higher disposal costs, as costs are often calculated on a material adverse effect on our business.

There is not now, and there may not everper ton basis. Because of these factors, we expect operating income to be an active market forgenerally lower in the Company’s Common Stock.

There currently is no public market for our Common Stock. Further, our Common Stock is not currently quoted on the OTC Markets (the “OTC Markets”) trading of our Common Stock has not yet commenced. If and when our stock does begin to trade, such trading may be extremely sporadic. For example, several days may pass before any shares may be traded.winter months. As a result, an investorour operating results may find it difficult to dispose of, or to obtain accurate quotationsbe negatively affected by these variations. Additionally, severe weather during any time of the priceyear can negatively affect the costs of collection and disposal and may cause temporary suspensions of our Common Stock. Accordingly, investors must assume theycollection services. Long periods of inclement weather may have to bearinterfere with collection operations and reduce the economic riskvolume of an investment inwaste generated by our Common Stock for an indefinite periodcustomers. Any of time. Therethese conditions can be no assurance that a more active market for the Common Stock will develop, or if one should develop, there is no assurance that it will be sustained. This severely limits the liquidityadversely affect our business and results of operations, which could negatively affect our Common Stock, and would likely have a material adverse effect on the market price of our Common Stock andstock price.

We are dependent on our ability to raise additional capital.

We cannot assure you that the Common Stock will become liquid or that it will be listed on a securities exchange.

Until our Common Stock is listed on a national securities exchange such as the New York Stock Exchange or the Nasdaq Stock Market, if ever, we expect our Common Stock to remain eligible for quotation on the OTC Markets. In that venue, however, an investor may find it difficult to obtain accurate quotations as to the market value of our Common Stock. In addition, if we fail to meet the criteria set forth in SEC regulations, various requirements would be imposed by law on broker-dealers who sell our securities to persons other than established customersmanagement team and accredited investors. Consequently, such regulations may deter broker-dealers from recommending or selling our Common Stock, which may further affect the liquidity of the Common Stock. This would also make it more difficult for us to raise capital.

Our Common Stock is subject to the “penny stock” rules of the SECdevelopment and operations personnel, and the trading market in the securities is limited, which makes transactions in the stock cumbersome and may reduce the valueloss of an investment in the stock.

The SEC has adopted Rule 15g-9 which establishes the definition of a “penny stock,” for the purposes relevant to us, as any equity security that has a market price of less than $5.00 per shareone or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require:

In order to approve a person’s account for transactions in penny stocks, the brokermore key employees or dealer must:

The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which, in highlight form sets forth:

Generally, brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for investors to dispose of common stock and cause a decline in the market value of stock.

Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.

The price of our Common Stock may become volatile, which could lead to losses by investors and costly securities litigation.

The trading price of our Common Stock is likely to be highly volatile and could fluctuate in response to factors such as:

● actual or anticipated variations in our operating results;

● announcements of developments by us or our competitors;

● announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments;

● adoption of new accounting standards affecting our Company’s industry;

● additions or departures of key personnel;

● sales of our Common Stock or other securities in the open market; and

● other events or factors, many of which are beyond our control.

The stock market is subject to significant price and volume fluctuations. In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been initiated against the company. Litigation initiated against us, whether or not successful, could result in substantial costs and diversion of our management’s attention and resources, whichgroups could harm our business and financial condition.prevent us from implementing our business plan in a timely manner.

Our success depends substantially upon the continued services of our executive officers and other key members of management, particularly our chief executive officer, Mr. Glen Miller, and our chief operating officer, Mr. Jeffrey Rizzo. From time to time, there may be changes in our executive management team resulting from the hiring or departure of executives. Such changes in our executive management team may be disruptive to our business. We do not anticipate dividends to be paid on our Common Stock, and investors may lose the entire amount of their investment.

Cash dividends have never been declared or paidare also substantially dependent on the Common Stock,continued service of our existing development and operations personnel because of the complexity of our service and technologies. While we have employment agreements with Messrs. Miller and Rizzo, we do not anticipatemaintain a key person life insurance policy on either of such a declaration or payment for the foreseeable future. We expect to use future earnings, if any, to fund business growth. Therefore, stockholders will not receive any funds absent a saleofficers. The loss of their shares. We cannot assure stockholders of a positive return on their investment when they sell their shares, nor can we assure that stockholders will not lose the entire amount of their investment.

If securities analysts do not initiate coverage or continue to cover our Common Stock or publish unfavorable research or reports about our business, this may have a negative impact on the market price of our common stock.

The trading market for the Common Stock will depend on the research and reports that securities analysts publish about our business and the Company. We do not have any control over these analysts. There is no guarantee that securities analysts will cover the Common Stock. If securities analysts do not cover the Common Stock, the lack of research coverage may adversely affect its market price. If we are covered by securities analysts, and our stock is the subject of an unfavorable report, our stock price and trading volume would likely decline. If one or more of these analysts ceases to cover the Companyour key employees or fails to publish regular reports on the Company, wegroups could lose visibilityseriously harm our business.

We have identified certain material weaknesses in the financial markets,our internal controls, which could cause stockholders and prospective investors to lose confidence in the reliability of our stockfinancing reporting.

Based upon the evaluation of the disclosure controls and procedures at the end of the period covered by this report, our chief executive officer and our chief financial officer concluded that our disclosure controls and procedures were not effective as a result of continuing weaknesses in our internal control over financial reporting principally due to the following: (i) we have not established adequate financial reporting processes or monitoring activities to ensure adequate financial reporting and to mitigate the risk of management override, specifically because there are few employees and only two officers with management functions and therefore there is lack of segregation of duties; (ii) an outside consultant assists in the preparation of the annual and quarterly financial statements and partners with us to ensure compliance with U.S. GAAP and SEC disclosure requirements; and (iii) we did not maintain a sufficient complement of qualified accounting personnel and controls associated with segregation of duties over complex transactions.

If we fail to maintain an effective system of internal controls, we may not be able to accurately report financial results or prevent fraud. As a result, current and potential stockholders could lose confidence in our company’s financial reporting that could harm the trading price of our shares, if a trading market does develop.

We need additional capital to develop our business.

The development of our services will require the commitment of substantial resources to implement our business plan. In addition, substantial expenditures will be required to enable us to complete projects in the future. We currently have no additional borrowing capacity under our existing credit agreement, and it is likely we will need to seek additional financing through subsequent future private or trading volumepublic offerings of our equity securities or through strategic partnerships and other arrangements with corporate partners.

We cannot give you any assurance that any additional financing will be available to decline.us, or if available, will be on terms favorable to us. The sale of additional equity securities will result in dilution to our stockholders. The occurrence of indebtedness would result in increased debt service obligations and could require us to agree to operating and financing covenants that would restrict our operations. If adequate additional financing is not available on acceptable terms, we may not be able to implement our business development plan or continue our business operations.

Cyber incidents or cyberattacks directed at us could result in information theft, data corruption, operational disruption and/or financial loss.

We depend on digital technologies, including information systems, infrastructure and cloud applications and services, including those of third parties with which we may deal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential data. As an early stage company without significant investments in data security protection, we may not be sufficiently protected against such occurrences. We may not have sufficient resources to adequately protect against, or to investigate and remediate any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination of them, could have adverse consequences on our business and lead to financial loss.

Risks Related to Ownership of our Common Stock

You may experience dilution of your ownership interestsinterest because of the future issuance of additional shares of the Commonour common stock and because of our preferred stock and outstanding rights to acquire common stock and warrants.

As of March 31, 2024, our authorized capital stock consisted of 425,000,000 shares, of which 400,000,000 shares were designated as common stock and 25,000,000 shares were designated as preferred stock, of which 630,900 shares were designated Series A Convertible Preferred Stock, and 1,360,000 shares were designated as Series B Convertible Preferred Stock.

In the future, we mayexpect to issue our authorized but previously unissued equity securities resultingin connection with future financings, which could result in the dilution of the ownership interests of our present stockholders and the purchasers of Common Stock offered hereby. We are currently authorized to issue an aggregate of 310,000,000 shares of capital stock consisting of 300,000,000 shares of Common Stock, par value $0.0001, and 10,000,000 shares of preferred stock, par value $0.0001, with preferences and rights to be determined by our Board of Directors. We authorized 50,000 shares of our Preferred Stock as Series A and 50,000 shares are issued and outstanding. As of the date of this Report, there are 6,824,250 shares of our Common Stock issued and outstanding and 50,000 shares of our Series A Preferred Stock issued and outstanding.stockholders. We may also issue additional shares of our Common Stockcommon stock or other securities that are convertible into or exercisable for our Common Stockcommon stock in connection with hiring or retaining employees or consultants, future acquisitions, future sales of itsour securities for capital raising purposes, or for other business purposes. The future issuance of any such additional shares of our Common Stockcommon stock or other securities may create downward pressure on the trading price of the Common Stock.our common stock. There can be no assurance that we will not be required to issue additional shares, warrants or other convertible securities in the future in conjunction with anyhiring or retaining employees or consultants, future acquisitions, future sales of our securities for capital raising efforts,purposes or for other business purposes, including at a price (or exercise or conversion prices) below the price at which shares of our common stock are trading.

Under any of the Common Stockcircumstances described above, future issuances or conversions may depress the market price of our common stock, and may impair our ability to raise additional capital in the financial markets at a time and price favorable to us. The effect of this dilution may, in turn, cause the price of our common stock to decrease further, both because of the downward pressure on our stock price that may be caused by a large number of sales of our shares into the public market by our preferred holders, and because our other existing stockholders may, in response, decide to sell additional shares of our common stock, further decreasing our stock price.

The market price of our common stock is likely to be volatile and could subject us to litigation.

The market price of our common stock has been and is likely to continue to be subject to wide fluctuations. Factors affecting the market price of our common stock include:

Any of these factors, as well as broader market and industry factors, may result in large and sudden changes in the trading volume of our common stock and could seriously harm the market price of our common stock, regardless of our operating performance. This may prevent you from being able to sell your shares at or above the price you paid for your shares of our common stock, if at all. In addition, following periods of volatility in the market price of a company’s securities, stockholders often institute securities class action litigation against that company. Our involvement in any class action suit or other legal proceeding could divert our senior management’s attention and could adversely affect our business, financial condition, results of operations and prospects.

There is currently only a limited public market for our common stock. Failure to develop or maintain a trading market could negatively affect the value of our common stock and make it difficult or impossible for you to sell any shares of our common stock that you hold.

There is currently only a limited public market for our common stock and an active public market for our common stock may not develop or be sustained. Failure to develop or maintain an active trading market could make it difficult for you to sell your shares without depressing the market price for our common stock or recover any part of your investment in us. Even if an active market for our common stock does develop, the market price of such securities may be highly volatile. In addition to the uncertainties relating to future operating performance and the profitability of operations, factors such as variations in interim financial results or various, as yet unpredictable, factors, many of which are beyond our control, may have a negative effect on the market price of our common stock. Further, quotes for shares of our common stock on the OTCQB may not be indicative of the market price on a national securities exchange, such as the NYSE or Nasdaq.

Our shares of common stock are subject to the penny stock rules, making it more difficult to trade our shares.

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or authorized for quotation on certain automated quotation systems, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system. Because our common stock is not listed on a national securities exchange and the current price of our common stock is less than $5.00, our common stock is deemed to be a penny stock. The penny stock rules require a broker-dealer, before a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing specified information. In addition, the penny stock rules require that before effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive (i) the purchaser’s written acknowledgment of the receipt of a risk disclosure statement; (ii) a written agreement to transactions involving penny stocks; and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our common stock, and therefore stockholders may have difficulty selling their shares.

There may be restrictions on your ability to resell shares of common stock under Rule 144.

Currently, Rule 144 under the Securities Act permits the public resale of securities under certain conditions after a six or twelve month holding period by the seller, including requirements with respect to the manner of sale, sales volume restrictions, filing requirements and a requirement that certain information about the issuer is publicly available. At the time that stockholders intend to resell their shares under Rule 144, there can be no assurances that we will be initially quotedsubject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or, if so, current in our reporting requirements under the Exchange Act, in order for stockholders to be eligible to rely on Rule 144 at such time. In addition to the foregoing requirements of Rule 144 under the Federal securities laws, the various state securities laws may impose further restrictions on the OTC Markets.ability of a holder to sell or transfer the shares of common stock.

Item 1B. Unresolved Staff CommentsSales of our currently issued and outstanding stock may become freely tradable pursuant to Rule 144 and may dilute the market for your shares and have a depressive effect on the price of the shares of our common stock.

None.A substantial majority of our outstanding shares of common stock are “restricted securities” within the meaning of Rule 144 under the Securities Act. As restricted shares, these shares may be resold only pursuant to an effective registration statement or under the requirements of Rule 144 or other applicable exemptions from registration under the Securities Act and as required under applicable state securities laws. Rule 144 provides in essence that an affiliate (as such term is defined in Rule 144(a)(1)) of an issuer who has held restricted securities for a period of at least six months (one year after filing Form 10 information with the SEC for shell companies and former shell companies) may, under certain conditions, sell every three months, in brokerage transactions, a number of shares that does not exceed the greater of 1% of an issuer’s outstanding shares of common stock or the average weekly trading volume during the four calendar weeks prior to the sale. Rule 144 also permits, under certain circumstances, the sale of securities, without any limitation, by a person who is not an affiliate of the issuer and who has satisfied a one-year holding period. A sale under Rule 144 or under any other exemption from the Securities Act, if available, or pursuant to subsequent registrations of our shares of common stock, may have a depressive effect upon the price of our shares of common stock in any active market that may develop.

Item 2. PropertiesPossible adverse effect of issuance of preferred stock.

As of March 31, 2024, our articles of incorporation authorized the issuance of 25,000,000 shares of preferred stock, of which 23,009,100 shares were “blank check” preferred stock available for issuance with designations, rights and preferences as may be determined from time to time by our board of directors. As a result of the foregoing, our board can issue, without further shareholder approval, preferred stock with dividend, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights of the holders of common stock. The issuance of preferred stock could, under certain circumstances, discourage, delay or prevent a change in control of our company.

We do not ownexpect to pay dividends on our common stock and investors should not buy our common stock expecting to receive dividends.

We have not paid any property. dividends on our common stock in the past, and do not anticipate that we will declare or pay any dividends on our common stock in the foreseeable future. Consequently, holders of common stock will only realize an economic gain on their investment in our common stock if the price appreciates. Investors should not purchase our common stock expecting to receive cash dividends. Because we do not pay dividends on our common stock, and there may be limited trading, investors may not have any manner to liquidate or receive any payment on their investment. Therefore, our failure to pay dividends may cause investors to not see any return on investment even if we are successful in our business operations. Because we do not pay dividends on our common stock, we may have trouble raising additional funds, which could affect our ability to expand our business operations.

We previously leased an officemay need to raise additional capital in the future. Additional capital may not be available to us on reasonable terms, if at all, when or as we require. If we issue additional shares of our common stock or other securities that may be convertible into, or exercisable or exchangeable for, our common stock, our existing stockholders would experience further dilution and could trigger anti-dilution provisions in outstanding warrants.

We may need to raise additional capital in the future for acquisitions or other purposes. Future financings may involve the issuance of debt, equity and/or securities convertible into or exercisable or exchangeable for our equity securities. These financings may not be available to us on reasonable terms or at all when and as we require funding. If we are able to consummate such financings, the trading price of our common stock could be adversely affected and/or the terms of such financings may adversely affect the interests of our existing stockholders. Any failure to obtain additional working capital when required would have a material adverse effect on our business and financial condition and may result in a decline in our stock price. Any issuances of our common stock, preferred stock, or securities such as warrants or notes that are convertible into, exercisable or exchangeable for, our capital stock, would have a dilutive effect on the voting and economic interest of our existing stockholders.

Our officers and directors are entitled to indemnification from us for liabilities under our articles of incorporation, which could be costly to us and may discourage the exercise of stockholder rights.

Our articles of incorporation provide that we possess and may exercise all powers of indemnification of our officers, directors, employees, agents and other persons and our bylaws also require us to indemnify our officers and directors as permitted under the provisions of the Nevada Revised Statutes (“NRS”). We will also have contractual indemnification obligations under our agreements with our directors and officers. The foregoing indemnification obligations could result in our company incurring substantial expenditures to cover the cost of settlement or damage awards against directors and officers. These provisions and resultant costs may also discourage our company from bringing a lawsuit against directors, officers and employees for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our stockholders against our directors, officers and employees even though such actions, if successful, might otherwise benefit our company and stockholders.

Our bylaws and Nevada law may discourage, delay or prevent a change of control of our company or changes in our management, which could have the result of depressing the trading price of our common stock.

Certain anti-takeover provisions of Nevada law could have the effect of delaying or preventing a third party from acquiring us, even if the acquisition arguably could benefit our stockholders.

Nevada’s “combinations with interested stockholders” statutes, NRS 78.411 through 78.444, inclusive, prohibit specified types of business “combinations” between certain Nevada corporations and any person deemed to be an “interested stockholder” for two years after such person first becomes an “interested stockholder” unless the corporation’s board of directors approves the combination, or the transaction by which such person becomes an “interested stockholder”, in advance, or unless the combination is approved by the board of directors and sixty percent of the corporation’s voting power not beneficially owned by the interested stockholder, its affiliates and associates. Further, in the absence of prior approval certain restrictions may apply even after such two-year period. However, these statutes do not apply to any combination of a corporation and an interested stockholder after the expiration of four years after the person first became an interested stockholder. For purposes of these statutes, an “interested stockholder” is any person who is (1) the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the outstanding voting shares of the corporation, or (2) an affiliate or associate of the corporation and at 201 Santa Monica Blvd., Suite 300, Santa Monica, California 90401-2224,any time within the locationtwo previous years was the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the then outstanding shares of the corporation. The definition of the term “combination” is sufficiently broad to cover most significant transactions between a corporation and an “interested stockholder.” These statutes generally apply to Nevada corporations with 200 or more stockholders of record. However, a Nevada corporation may elect in its articles of incorporation not to be governed by these particular laws, but if such election is not made in the corporation’s original articles of incorporation, the amendment (1) must be approved by the affirmative vote of the holders of stock representing a majority of the outstanding voting power of the corporation not beneficially owned by interested stockholders or their affiliates and associates, and (2) is not effective until 18 months after the vote approving the amendment and does not apply to any combination with a person who first became an interested stockholder on or before the effective date of the amendment. We did not make such an election in our articles of incorporation and have not amended our articles of incorporation to so elect.

Nevada’s “acquisition of controlling interest” statutes, NRS 78.378 through 78.3793, inclusive, contain provisions governing the acquisition of a controlling interest in certain Nevada corporations. These “control share” laws provide generally that any person that acquires a “controlling interest” in certain Nevada corporations may be denied voting rights, unless a majority of the disinterested stockholders of the corporation elects to restore such voting rights. Our bylaws provide that these statutes do not apply to us or any acquisition of our common stock. Absent such provision in our bylaws, these laws would apply to us as of a particular date if we were to have 200 or more stockholders of record (at least 100 of whom have addresses in Nevada appearing on our stock ledger at all times during the 90 days immediately preceding that date) and do business from inception.in the State of Nevada directly or through an affiliated corporation, unless our articles of incorporation or bylaws in effect on the tenth day after the acquisition of a controlling interest provide otherwise. These laws provide that a person acquires a “controlling interest” whenever a person acquires shares of a subject corporation that, but for the application of these provisions of the NRS, would enable that person to exercise (1) one fifth or more, but less than one third, (2) one third or more, but less than a majority or (3) a majority or more, of all of the voting power of the corporation in the election of directors. Once an acquirer crosses one of these thresholds, shares which it acquired in the transaction taking it over the threshold and within the 90 days immediately preceding the date when the acquiring person acquired or offered to acquire a controlling interest become “control shares” to which the voting restrictions described above apply.

Various provisions of our bylaws may delay, defer or prevent a tender offer or takeover attempt of us that a stockholder might consider in his or her best interest. Our principal shareholderbylaws may be adopted, amended or repealed by the affirmative vote of the holders of at least a majority of our outstanding shares of capital stock entitled to vote for the election of directors, and legal counselexcept as provided by Nevada law, our board of directors shall have the power to adopt, amend or repeal the bylaws by a vote of not less than a majority of our directors. The interests of these stockholders and directors may not be consistent with your interests, and they may make changes to the bylaws that are not in line with your concerns.

Nevada law also usesprovides that directors may resist a change or potential change in control if the directors determine that the change is opposed to, or not in the best interests of, the corporation. The existence of the foregoing provisions and other potential anti-takeover measures could limit the price that investors might be willing to pay in the future for shares of our common stock. They could also deter potential acquirers of our company, thereby reducing the likelihood that you could receive a premium for your common stock in an acquisition.

As a Smaller Reporting Company as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations and therefore are not required to provide the information requested by this location. Commencing April 1, 2011 until August 3, 2017, our majority shareholder and legal counsel provided us with office space, on a month-to-month basis, for no charge.Item 1B.

We acknowledge the increasing importance of cybersecurity in today’s digital and interconnected world. Cybersecurity threats pose significant risks to the integrity of our systems and data, potentially impacting our business operations, financial condition and reputation.

As a smaller reporting company, we currently do not have formalized cybersecurity measures, a dedicated cybersecurity team or specific protocols in place to manage cybersecurity risks. Our approach to cybersecurity is in the developmental stage, and we have not yet conducted comprehensive risk assessments, established an incident response plan or engaged with external cybersecurity consultants for assessments or services.

Given our current stage of cybersecurity development, we have not experienced any significant cybersecurity incidents to date. However, we recognize that the dateabsence of this annual report,a formalized cybersecurity framework may leave us vulnerable to cyberattacks, data breaches and other cybersecurity incidents. Such events could potentially lead to unauthorized access to, or disclosure of, sensitive information, disrupt our main corporate mailing addressbusiness operations, result in regulatory fines or litigation costs and negatively impact our reputation among customers and partners.

We are in the process of evaluating our cybersecurity needs and developing appropriate measures to enhance our cybersecurity posture. This includes considering the engagement of external cybersecurity experts to advise on best practices, conducting vulnerability assessments and developing an incident response strategy. Our goal is 14205 S.E. 36th St.,to establish a cybersecurity framework that is commensurate with our size, complexity and the nature of our operations, thereby reducing our exposure to cybersecurity risks.

In addition, our board of directors will oversee any cybersecurity risk management framework and a dedicated committee of our board of directors or an officer appointed by our board of directors will review and approve any cybersecurity policies, strategies and risk management practices.

Despite our efforts to improve our cybersecurity measures, there can be no assurance that our initiatives will fully mitigate the risks posed by cyber threats. The landscape of cybersecurity risks is constantly evolving, and we will continue to assess and update our cybersecurity measures in response to emerging threats.

For a discussion of potential cybersecurity risks affecting us, please refer to the “Risk Factors” section.

Our principal executive office is located at 300 E. Long Lake Road, Suite 100, Bellevue, WA 98006. We will consider leasing100A, Bloomfield Hills, Michigan, 48304, which is approximately 5,251 square feet of office space currently rented at a rate of $7,417 per month. In addition, we lease 10,704 square feet of office and shop facilities space currently rented at a rate of $9,016 per month in Troy, Michigan and 13,823 square feet of office space currently rented at a rate of $22,500 per month in Linwood, Michigan. It is our belief that such space is adequate for our immediate office needs. Additional space may be required as we expand our business activities, but we do not foresee any significant difficulties in obtaining additional office space afterfacilities if deemed necessary.

Our principal property and equipment is comprised of vehicles and equipment in the State of Michigan. In addition, we lease real property in Michigan and Pennsylvania. These properties are sufficient to meet our current operational needs; however, we are exploring the potential acquisition and/or leasing of additional properties pursuant to its public listinggrowth strategies.

There are no material proceedings to which any director or officer, or any associate of any such director or officer, is completed.a party that is adverse to our company or any of our subsidiaries or has a material interest adverse to our company or any of our subsidiaries. No director or executive officer has been a director or executive officer of any business which has filed a bankruptcy petition or had a bankruptcy petition filed against it during the past ten years. Except as described below, no current director or executive officer has been convicted of a criminal offense or is the subject of a pending criminal proceeding during the past ten years. No current director or executive officer has been the subject of any order, judgment or decree of any court permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities during the past ten years. No current director or officer has been found by a court to have violated a federal or state securities or commodities law during the past ten years.

Item 3. Legal Proceedings

From time to time, the Company iswe may become a party to various legal or administrative proceedings arising inlitigation and subject to claims incident to the ordinary course of our business. While anyAlthough the results of such litigation contains an elementand claims in the ordinary course of uncertainty,business cannot be predicted with certainty, we have no reason to believe that the final outcome of such proceedingsmatters will not have a material adverse effect on the financial condition orour business, results of operations or financial condition. Regardless of outcome, litigation can have an adverse impact on us because of defense costs, diversion of management resources and other factors. Currently, there is no litigation pending against our company that could materially affect our company other than as follows:

In July 2022, a complaint was filed against our Titan Trucking subsidiary in the Circuit Court for Macomb County, Michigan titled Wolverine Transfer and Recycling LLC v. Titan Trucking LLC (Case No. 22-002780-CB) for breach of contract. In the complaint, the plaintiff alleges that Titan Trucking has breached a contractual agreement between Titan Trucking and the plaintiff pertaining to the transport of certain non-hazardous solid waste or recyclables from plaintiff’s transfer station to the locations identified in the contract. The complaint seeks unspecified damages, attorney and expert fees and other unspecified litigation costs. Titan Trucking has denied the claims of the Company.plaintiff, and in May 2023, Titan Trucking filed amended counterclaims against the plaintiff alleging that plaintiff breached the contractual agreement by preventing Titan Trucking’s performance of its obligations under the agreement by failing to, among things, provide the necessary volumes of materials for shipment and the personnel sufficient to permit Titan Trucking to provide its services and by failing to pay certain invoices and to reimburse Titan Trucking for equipment damaged by plaintiff’s employees and for overweight trailer tickets. This matter is presently set on the court’s non-jury trial docket. Titan Trucking intends to continue to vigorously defend this lawsuit and to prosecute its counterclaims.

Item 4. Mine Safety DisclosuresIn July 2023, a complaint was filed against us and Ajay Sikka, a director of our company and our former chief executive officer, in the Circuit Court of the Nineteenth Judicial Circuit, Lake County, Illinois titled Alta Waterford, LLC v. TraQiQ, Inc. and Ajay Sikka (Case No. 23LA00000476) for breach of contract. In the complaint, the plaintiff alleges that we breached contracts for the payment of compensation for investor relations and web development and copyright services allegedly provided by the plaintiff, which payment obligation was personally guaranteed by Mr. Sikka. The complaint seeks damages in the amount of $324,000, attorney fees and other unspecified litigation costs. We answered the complaint, denying all of the basic allegations, and the plaintiff then moved to strike our answer. In December 2023, the parties entered an agreement pursuant to which the plaintiff agreed to produce all of the documents supporting its claim that it performed services under the contracts, and we agreed that we would serve and file an amended answer within 21 days after receipt of their documents.  Since that time, the plaintiff produced its documents and we filed our amended answer.  We anticipate conducting deposition discovery in the weeks and months ahead, and the matter is scheduled for trial in Illinois in September 2024.

As of December 31, 2023, no accruals for loss contingencies have been recorded as the outcome of this litigation is neither probable nor reasonably estimable.

Not applicable.

PART II

Item 5. MarketOur common stock is listed for Registrant’s Common Equity, Related Stockholder Mattersquotation on the OTCQB market operated by the OTC Markets Group under the trading symbol “TESI.” Trading in our common stock on the OTCQB market has been limited and Issuer Purchasesthe quotations set forth below are not necessarily indicative of Equity Securitiesactual market values. The following table sets forth, for the periods indicated, the high and low closing bid prices for each quarter within the last two fiscal years ended December 31, 2023 on the OTCQB market as reported by OTC Markets Group. All quotations for the OTCQB market reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

Market Information

There is no active marketOn March 29, 2024, the closing bid price for our common stock.stock on the OTCQB market as reported by the quotation service operated by the OTC Markets Group was $0.74.

Transfer Agent

Equity Stock Transfer, LLC is the registrar and transfer agent for our common shares. Its address is 237 W 37th St Suite 602, New York, NY 10018, Telephone: 212-575-5757, Facsimile: 347-584-3644.

Holders of ourOur Common Stock

As of March 12, 2018,29, 2024, there were approximately 52 stockholders122 registered holders of record of our common stock. ThisAs of such date, 25,386,814 shares of common stock were issued and outstanding. The number does not includeof our shareholders of record excludes any estimate by us of the number of beneficial owners of shares held by brokerage clearing houses, depositories or others in unregistered form. Thestreet name, the accuracy of which cannot be guaranteed.

Dividends

We have not declared any common stock transfer agent fordividends to date and the provisions of our securities is Equity Stock Transfer.

Dividends

The Company has never declared or paidLoan Agreement with Michaelson prohibit our payment of dividends so long as the Michaelson Note remains outstanding. As a result, we have no present intention of paying any cash dividends on itsour common stock. The Company currently intendsstock in the foreseeable future, and we intend to retain futureuse earnings, if any, to financegenerate growth. Subject to any limitations on the expansionpayment of its business. As a result, the Company does not anticipate paying any cash dividends in our credit facilities, the foreseeable future.payment by us of dividends, if any, in the future, is within the discretion of our board of directors and will depend upon, among other things, our earnings, capital requirements and financial condition, as well as other relevant factors. There are no material restrictions in our Articles of Incorporation, as amended, or Bylaws that restrict us from declaring dividends.

Securities Authorized for Issuance Under Equity Compensation Plans

None.The following table provides information as of December 31, 2023, regarding our compensation plans under which equity securities are authorized for issuance:

Unregistered Sales of Equity Securities

On January 23, 2024, 100,000 of our Series A Rights to Receive Common Stock (“Series A Rights”) were exercised. As a result, we issued 100,000 shares of common stock to holders of such Series A Rights.

On July 19, 2017, the Company approved the issuanceBetween January 17, 2024 and January 29, 2024, 10,152,269 of 50,000 shares of itsour Series A Convertible PreferredB Rights to Received Common Stock to its CEO and, on August 1 2017, the Company sold and(“Series B Rights”) were exercised. As a result, we issued the 50,000 shares of its Series A Convertible Preferred Stock to its CEO at a price of $0.20 per share for $10,000.

On July 19, 2017, the Company issued 3,000,00010,152,269 shares of common stock to the former shareholdersholders of Ci2i pursuant to the Share Exchange Agreement. The acquisition of Ci2i was considered a reverse merger with Ci2i the accounting acquiror.such Series B Rights.

In addition, on July 19, 2017, the Company acquired OmniM2M. For accounting purposes, the acquisitionJanuary 2024, we issued an aggregate of OmniM2M is recorded at historical cost2,750,001 warrants to purchase common stock to investors in accordance with ASC 805-50-25-2 as this is considered an acquisition of entities under common control as the management of the Company and OmniM2M control the activities of the respective companies. The Company issued 3,000,000 shares to the former shareholders of OmniM2M in this acquisition.a private placement.

All theThe offers, sales and salesissuances of securities listed above, were made to accredited investors.The issuance of the above securities isdeemed exempt from the registration requirements under Rule 4(2)Section 4(a)(2) of the Securities Act or Regulation D promulgated thereunder in that the issuance of 1933, as amended, and/securities did not involve a public offering. The recipients of such securities in each of these transactions represented their intention to acquire the securities for investment purposes only and not with a view to or Rule 506 as promulgated under Regulation D.for sale in connection with any distribution thereof. All of the foregoing securities are deemed restricted securities for purposes of the Securities Act and appropriate legends were affixed to the securities issued in such transactions.

Item 6. Selected Financial Data.

As a smaller reporting company, the Company is not required to file selected financial data.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported revenues and expenses during the reporting periods. On an ongoing basis, we evaluate estimates and judgments, including those described in greater detail below. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

As used

Overview of Our Company

We operate two distinct lines of business. The first is Titan Trucking, LLC (“Titan Trucking”), a non-hazardous solid waste management company providing waste and recycling collection and transportation services for industrial generators, commercial contractors and transfer station operators in this “Management’s DiscussionMichigan. Titan Trucking maintains a fleet of roll off and Analysistractor trailer trucks to perform its services. Titan Trucking operates in a highly recession resistant industry given the ongoing generation of Financial Conditionwaste and Resultsrecyclable materials. Titan Trucking’s goal is to provide our customers with safe and efficient options for the disposal and recycling of Operation,” except wheretheir waste streams. Titan Trucking has begun to create the context otherwise requires,infrastructure needed to expand its operations organically and through strategic acquisitions and market development opportunities across the term “we,” “us,” “our,” or “the Company,” refersMidwest, Northeast and Southeast regions of the United States. The second is Recoup Technologies, Inc., which provides technology enabled solutions for food waste processing including onsite Digestors for food waste along with cloud-based software tracking and analytics solutions.

Disposal of TraQiQ Private Solutions, Inc (“Ci2i”)

On July 28, 2023, we and our wholly-owned subsidiary, TraQiQ Solutions, Inc (“Ci2i”), and Ajay Sikka (“Sikka”), a director and our former chief executive officer, entered into an Assignment of Stock Agreement (the “Assignment Agreement”). Under the terms of the Assignment Agreement, we assigned and transferred to the businessSikka all of TraqIQ Inc.

Overview

TraqIQ, Inc. (along with its wholly owned subsidiaries, referred to herein as the “Company”) was incorporatedour rights, title and interests in the Stateissued and outstanding equity interests of California on September 9, 2009 as Thunderclap Entertainment, Inc. On July 14, 2017, Thunderclap Entertainment, Inc. changed its name to TraqIQ, Inc. On July 19, 2017, the Company entered into a Share Exchange Agreement (“share Exchange”) with the stockholders of OmniM2M, Inc. (“OmniM2M”) and Ci2i Services, Inc. (“Ci2i”) whereby the stockholders of OmniM2M and Ci2i agreed to exchange all of their respective shares, representing 100% ownership in OmniM2M and Ci2i in exchange for 3,000,000consideration of $1. We additionally assumed from Ci2i loans and short-term debts valued at $209,587 plus fees and interest. Other than the liabilities assumed from Ci2i, the balance sheet amounts and operations of Ci2i as of the date of sale were insignificant.

Reverse Acquisition with Titan Trucking, LLC

On May 19, 2023, we and our wholly-owned subsidiary, Titan Merger Sub Corp. (“Merger Sub”), entered into an Agreement and Plan of Merger (the “Merger Agreement”), with Titan Trucking, Titan 5, LLC, a Michigan limited liability company (“Titan 5”), Titan National Holdings 2, LLC, a Michigan limited liability company (“Holdings”), Jeffrey Rizzo, an individual (“JR”), William McCauley, an individual (“WM”, and, together with Holdings, Titan 5 and JR, the “Sellers”), and Jeffrey Rizzo, as the Seller Representative, pursuant to which, Merger Sub was merged with and into Titan Trucking, with Titan Trucking continuing as the surviving entity and as a wholly-owned subsidiary of our company (the “Titan Merger”).

For U.S. federal income tax purposes, the Titan Merger qualified as a tax-free “reorganization”. Under the terms of the Titan Merger Agreement, upon the closing of the Titan Merger, we paid the Titan Trucking owners 630,900 shares of our Series C Preferred Stock. Concurrent to the Company’s common stock, respectively. The Share ExchangeTitan Merger, our chief executive officer and one of our directors resigned from their respective positions and our current chief executive officer, chief operating officer and chief financial officer were appointed. Additionally, the new chief executive officer and chief operating officer were both appointed as directors of our company.

In accordance with ASC 805 – Business Combinations, the Titan Merger was accounted for as a reverse merger whereas Ci2i is consideredacquisition with Titan Trucking being deemed the accounting acquirer and TraqIQ,Inc. is consideredof our company. Titan Trucking, as the accounting acquiree. Accordingly,acquirer, recorded the assets and liabilities of our company at their fair values as of the acquisition date. The historical consolidated financial statements includedof Titan Trucking have replaced our historical consolidated financial statements with respect to periods prior to the accountscompletion of Ci2i for all periods presentedthe Titan Merger with retroactive adjustments to Titan Trucking’s legal capital to reflect the legal capital of our company. We remain the continuing registrant and reporting company.

Titan Trucking was deemed to be the accountsaccounting acquirer based on the following facts and circumstances: (1) the Titan Trucking owners owned approximately 65% of TraqIQ, Inc. and OmniM2M, which was acquired by the Company on July 19,2017 sincevoting interests of the datecombined company immediately following the transaction; (2) the Titan Merger resulted in significant changes to the combined company’s board of acquisition. For accounting purposes,directors; (3) the acquisition of OmniM2M is recorded at historical costTitan Merger resulted in accordance with Accounting Standard Codification (“ASC”) 805-50-25-2 as this is considered an acquisition of entities under common control assignificant changes to the management of the Companycombined company.

We accounted for the Titan Merger as a reverse acquisition using acquisition accounting. Because the Titan Merger qualifies as a reverse acquisition and OmniM2M controlgiven that Titan Trucking was a private company at the activitiestime of the respective companies. PriorTitan Merger and therefore its value was not readily determinable, the fair value of the merger consideration was deemed to be equal to the merger with Ci2iquoted market capitalization of our company at the acquisition date. The purchase consideration was as follows:

We recorded all tangible and intangible assets and liabilities at their estimated fair values on the acquisition of OmniM2M,date. The following represents the Company was considered a shell company under Rule 12b-2allocation of the Exchange Act. On December 1, 2017, The Company entered into a Share Purchaseestimated purchase consideration:

Reincorporation as Titan Environmental Solutions Inc.

Effective January 10, 2024, and pursuant to an Amended and Restated Agreement and Plan of Merger (the “Share Exchange“Reincorporation Agreement”) with Ajay Sikka (“Sikka”), we merged with and into (the “reincorporation”) our wholly-owned subsidiary, Titan Environmental Solutions Inc., a Nevada corporation (“Titan”), with Titan as the sole shareholdersurviving entity. As a result of Transport IQ,the reincorporation, our jurisdiction of incorporation was changed from California to Nevada and our corporate name was changed from “TraQiQ, Inc. whereby Sikka agreed” to sell“Titan Environmental Solutions Inc.” The individuals serving as our executive officers and directors as of the effective time of the reincorporation continued to serve in such respective capacities with Titan following the effective time of the reincorporation.

Change in Equity Instruments and Share Authorizations

Pursuant to the Reincorporation Agreement, each share of our common stock issued and outstanding immediately prior to the reincorporation was converted into one share of Titan’s common stock. Additionally, each share of our Series C Convertible Preferred Stock issued and outstanding immediately prior to the effective time of the reincorporation was converted into one share of Series A Convertible Preferred Stock of Titan (the “Series A Preferred Stock”), which has substantially the same rights and preferences as the Series C Preferred Stock. Each of our Series A Rights to Receive Common Stock issued and outstanding immediately prior to the reincorporation was converted into one Series A Right to Receive Common Stock of Titan, which has substantially the same rights and preferences as our original Series A Rights to Acquire Common Stock. Each of our Series B Rights to Receive Common Stock issued and outstanding immediately prior to the reincorporation was converted into one Series B Right to Receive Common Stock of Titan, which has substantially the same rights and preferences as our original Series B Rights to Acquire Common Stock.

As a result of the reincorporation, all of our outstanding warrants were assumed by Titan and now represent warrants to acquire shares of Titan’s common stock. The reincorporation increased our authorized capital stock to 425,000,000 total shares, consisting of 400,000,000 shares of common stock, par value $0.0001 per share, and 25,000,000 shares of preferred stock, par value $0.0001 per share, of which 630,900 shares were designated “Series A Convertible Preferred Stock”. In connection with the reincorporation, we also adopted the “Titan Environmental Solutions Inc. 2023 Equity Incentive Plan.”

Authorization of Reverse Stock Split

In connection with the approval of the Reincorporation Agreement, our board of directors was authorized to effect a reverse stock split of our outstanding common stock (the “Reverse Stock Split”) on the basis of one share of our common stock for up to 50 shares of our common stock, at an exact ratio at the discretion of the board of directors, at any time prior to the first anniversary of the effective date of the reincorporation. In connection with the Reverse Stock Split, if one is approved by our board of directors, our board of directors may also amend our articles of incorporation to reduce the number of authorized shares of common stock to a number of shares, as determined by the board of directors, that is not less than 110% of the number of outstanding shares of common stock on a fully-diluted basis after giving effect to the Reverse Stock Split.

Change in Trading Symbol of Common Stock

Following the reincorporation and effective on January 16, 2024, the trading symbol of our common stock changed from “TRIQ” to “TESI”.

Creation of Series B Preferred Stock

On March 29, 2024, we filed a Certificate of Designation with the Nevada Secretary of State (as subsequently amended, the “Certificate of Designation”), designating 1,360,000 authorized shares of preferred stock as Series B Convertible Preferred Stock (the “Series B Preferred Stock”). As of the date of this Report, 50,000 shares of Series B Preferred Stock have been issued.

The Series B Preferred Stock ranks senior to the Series A Preferred Stock with respect to dividend rights and rights on the distribution of assets upon liquidation, dissolution and winding up. Holders of Series B Preferred Stock are entitled to receive dividends accruing on a daily basis in arrears at the rate of 10% per annum, or after the occurrence and during the continuance of a Triggering Event (as defined in the Certificate of Designation), 15% per annum, based on a 360 day year and the stated value of the Series B Preferred Stock of $10.00 per share (the “Stated Value”). We may, at our option, upon not less than ten (10) days nor more than sixty (60) days’ written notice, redeem the then issued and outstanding shares of Series B Preferred Stock, in whole or in part, at any time or from time to time, for cash at a redemption price of 130% of the Stated Value per share of Series B Preferred Stock, plus any accumulated and unpaid dividends thereon to, but not including, the date fixed for redemption. Upon the occurrence of a Mandatory Redemption Event (as defined in the Certificate of Designation), we will be required to redeem all of the then issued and outstanding shares in TransportIQ, Inc. (“TransportIQ”) in exchange for $18,109,of Series B Preferred Stock. The holders of the Series B Preferred Stock may elect to convert the Series B Preferred Stock into shares of common stock, at the applicable conversion rate (subject to certain adjustments), at any time, which right is subject to the Beneficial Ownership Limitation (as defined in the formCertificate of cancellationDesignation). Subject to certain terms, we have the right to require the each holder of Series B Preferred Stock to mandatorily convert all or any portion of their Series B Preferred Stock. A holder of outstanding shares of Series B Preferred Stock shall be entitled to cast the debtnumber of TransportIQ that is owedvotes equal to the Company. The transaction became effective uponnumber of whole shares of common stock into which the executionshares of Series B Preferred Stock held by such the Share Exchange AgreementHolder are convertible on any matter presented to our stockholders, except as required by Sikka and the Company; and Transport IQ, Inc, is now a wholly-owned subsidiary of the Company. Because TransportIQ was commonly controlled and owned, the transaction was recorded at the historical carrying value of TransportIQ’s assets and liabilities,

Ci2i is an innovative and growth-oriented services company founded in 1998 that develops and deploys intelligent technologies and products in order to meet the demand for sustainable, integrated solutions to contemporary business needs. Ci2i is a consulting services company that provides marketing and technical services to its clients. These services are delivered both on a Project and a Time & Materials basis. The primary focus has beenlaw or as specifically set forth in the Analytics and Intelligence segments. The Company typically does not ownCertificate of Designation. In the event of a liquidation, dissolution or winding up of our company, each holder of Series B Preferred Stock is entitled to receive out of our assets before any IP, as allpayment or distribution shall be made to the work is done on behalfholders of the clients. The Company does most of its business with Microsoft and is looking to diversify into other segments and customers.

OmniM2M was formed in 2014 and is an innovative and growth-oriented company that develops and deploys “Internet of Things” (IoT) and “Mobile to Mobile” (M2M) products in order to meet the demand for sustainable, integrated solutions to contemporary business needs.

TransportIQ was formedany Junior Securities (as defined in the StateCertificate of NevadaDesignation), the greater of (i) an amount per share equal to the sum of (x) the Stated Value and (y) any unpaid dividends, and (ii) the same amount that a holder of common stock would receive on September 8, 2017. TransportIQ is long haul trucking carrier business that comprises contract drivers and owner operators. TransportIQ’s customers include leading third-party logistics and supply chain management providers such as C.H. Robinson and PAM Transport, Inc. TransportIQ plans to differentiate itself from traditional carriers throughan as-converted basis.

Going Concern

For the adoptionyear ended December 31, 2023, we had a net loss of new technologies that can help TransportIQ create competitive advantages in the transportation industry, including:

Going Concern

The Company has an accumulated deficit and$149,005,049. We had a working capital deficit of approximately $1.3 million$10,935,108 as of December 31, 2017. The Company’s continuation2023 (deficit of $1,106,879 as of December 31, 2022). These conditions raise substantial doubt about our ability to continue as a going concern for a period of time within one year after the date on which our consolidated financial statements were issued.

Management’s plans include raising capital through issuances of equity and debt securities, and minimizing operating expenses of the business to improve our cash burn rate. On July 17, 2023, we converted $1,944,000 of principal and $75,263 of accrued interest related to our outstanding convertible note payables into Series A Rights, resulting in the extinguishment of almost all of our convertible note embedded derivative liabilities. In addition, we have been successful in attracting substantial capital from investors interested in the current public status of our company that has been used to support our ongoing cash outlays. This included $2,595,000 of convertible notes during the year ended December 31, 2023. We believe, but cannot guarantee, we will continue to be able to attract capital from outside sources as we pursue a move to a national stock exchange. We have engaged a qualified investment bank to assist in the uplisting of our common stock and simultaneous raise of capital. In addition, our revenue continues to grow and we expect to shrink our net losses over the upcoming quarters through organic and acquisitive growth. We have identified a plan to decrease expenses going forward to reduce our cash burn.

Employee Benefit Plan

Titan Trucking offers a 401(k) plan. Employees are eligible to participate in the plan on the first day of the month following the date of hire. Employees may defer up to $22,500 per year. Titan Trucking is dependentrequired to contribute on behalf of each eligible participating employee. Titan Trucking will match 50% of the participants deferral not to exceed 3% of employee compensation. Employees will share in the matching contribution regardless of the amount of service completed during the plan year. Employees will become 100% vested in the employer matching contributions after one year of service.

Employer contributions for the years ended December 31, 2023 and 2022 were $15,116 and $11,164, respectively.

Results of Operations and Financial Condition for the Year Ended December 31, 2023 as Compared to the Year Ended December 31, 2022

Revenue

For the year ended December 31, 2023 compared to December 31, 2022, our revenues increased by $3,421,472, or 81%, from $4,203,112 to $7,624,584. The increase was the result of the Titan Merger on May 19, 2023, and the resulting revenue generated by the combined operations of our company and Titan Trucking. The Titan Merger resulted in the development of our Digester Segment and our revenue from product sales and related product services. We also expanded the operations of our Trucking Segment with the acquisition of new containers and other fixed assets, which increased the revenue generated.

Cost of Revenue

For the year ended December 31, 2023 compared to December 31, 2022, our cost of revenue increased by $2,295,283, or 55%, from $4,207,852 to $6,503,135. The increase was the result of the Titan Merger on May 19, 2023, and the resulting increased revenue caused by the combined operations of our company and Titan Trucking. Additionally, we have continued to expand the Trucking Segment operations, which also resulted in increased cost of revenues.

Operating Expenses

For the year ended December 31, 2023 compared to December 31, 2022, our salary and salary-related costs increased by $1,244,980, or 262%, from $475,512 to $1,720,492. The increase was due to the increased personnel costs associated with the Titan Merger and increases to the operational activity of Titan Trucking.

For the year ended December 31, 2023 compared to December 31, 2022, our stock-based compensation increased by $5,590,486, or 100%, from $0 to $5,590,486. The increase was due to the vesting of restricted stock awards.

For the year ended December 31, 2023 compared to December 31, 2022, our professional fees increased by $2,881,117, or 1,085%, from $265,575 to $3,146,692. The increase was attributed primarily to consulting, accounting and legal fees incurred during 2023 related to the Titan Merger and our other acquisition activities.

For the year ended December 31, 2023 compared to December 31, 2022, our depreciation and amortization expense increased by $505,434, or 100%, from $0 in December 2022 to $505,434. The increase in depreciation and amortization expense was the result of the intangible assets recognized from the Titan Merger.

For the year ended December 31, 2023 compared to December 31, 2022, our general and administrative expenses increased by $715,459, or 199%, from $359,175 to $1,074,634. The increase was primarily due to our increased operational and sales activities, the addition of two leases, and the Titan Merger.

Impairment of Goodwill

Due to the reverse acquisition with Titan Trucking, we recognized goodwill of $26,880,916 for the Digester reporting unit on our consolidated balance sheet. As a result of the financial performance of our Digester Segment, we concluded it was more likely than not that the fair value of the reporting unit was less than its carrying amount as of June 30, 2023. We performed an impairment assessment of the goodwill. Our quantitative impairment test indicated a fair value of the reporting unit that was lower than its carrying value, and as a result, the goodwill was impaired with an impairment expense of $20,364,001 during the year December 31, 2023. There was no goodwill impairment expenses for the year ended December 31, 2022.

Interest Expense, net of Interest Income

For the year ended December 31, 2023 compared to December 31, 2022, our interest expense, net of interest income increased by $1,180,669, or 592%, from $199,453 to $1,380,122. The increase was due mainly to a large increase in debt instruments accruing interest on our consolidated balance sheet as a result of the Titan Merger. We have also issued and sold new debt instruments following the Titan Merger, which has resulted in increased interest expense.

Net Loss

For the year ended December 31, 2023 compared to December 31, 2022, our net loss increased by $148,346,386, or 22,522% from $658,663 to $149,005,049 due to the loss on extinguishment and issuance of share rights of $116,591,322, the impairment to goodwill, the increase in professional expenses, and the other effects of the Titan Merger.

Segment Analysis

Operating segments are components of an enterprise about which separate financial information is available and is evaluated regularly by management, namely the Chief Operating Decision Maker (“CODM”) of an organization, in order to determine operating and resource allocation decisions. By this definition, we have identified our Chief Operating Officer as the CODM. We operate and report in two segments: Trucking and Digesters.

Trucking Segment: The Trucking Segment generates service revenues and incurs expenses by transporting environmental and other waste for customers.

Digester Segment: The Digester Segment primarily generates revenues and incurs expenses through the production and sale of ‘digester’ equipment to customers. This segment also generates revenue through related services, such as digester maintenance and software services.

We believe that this structure reflects our current operational and financial management, and that it provides the best structure for our company to focus on growth opportunities while maintaining financial discipline. The factors used to identify the Trucking and Digester operating segments were the difference in revenue streams and customer base for each segment, the reporting structure for operational and performance information within our company, and our decision to organize our company around the different revenue generating activities of the segments. Total revenues for each reportable segment was as follows:

Gross profit (loss) for each reportable segment is as follows:

Net loss before provision for income taxes for each reportable segment is as follows:

Total assets, capital expenditures, and depreciation and amortization expense for each reportable segment is as follows:

Adjusted EBITDA (Non-U.S. GAAP Financial Measure)

We have included in this report Adjusted EBITDA, a measure of financial performance that is not defined by U.S. GAAP. We believe that this measure provides useful information to investors and include this measure in other communications to investors.

For this non-U.S. GAAP financial measure, we are providing below a reconciliation of the differences between the non-U.S. GAAP measure and the most directly comparable U.S. GAAP measure, an explanation of why our management and board of directors believe the non-U.S. GAAP measure provides useful information to investors and any additional purposes for which our management and board of directors use the non-U.S. GAAP measures. This non-U.S. GAAP measure should be viewed in addition to, and not in lieu of, the comparable U.S. GAAP measures.

We define Adjusted EBITDA as net loss before interest expense (net of interest income), income taxes, depreciation and amortization, and certain non-recurring and non-cash transactions such as goodwill impairments, loss on extinguishment and issuance of share rights, stock-based compensation, and the change in fair value of derivative liabilities. Our management believes that this presentation provides useful information to management and investors regarding our core trends by providing a more direct view of the underlying costs and performance. In addition, management uses this measure for reviewing our financial and operational results. Adjusted EBITDA is a non-U.S. GAAP measure and may not be comparable to similarly titled measures reported by other companies.

We do not consider Adjusted EBITDA in isolation or as an alternative to financial measures determined in accordance with U.S. GAAP. The principal limitation of Adjusted EBITDA is that it excludes certain expenses and income that are required by U.S. GAAP to be recorded in our consolidated financial statements. In addition, Adjusted EBITDA is subject to inherent limitations as this metric reflects the exercise of judgment by management about which expenses and income are excluded or included in determining Adjusted EBITDA. In order to compensate for these limitations, management presents Adjusted EBITDA in connection with U.S. GAAP results. A reconciliation of net loss to Adjusted EBITDA is as follows: