UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended ~~September 30, 2021~~March 31, 2022

☐ 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: 001-39132

EVMO, INC.

(exact name of registrant as specified in its charter)

~~RIDESHARE RENTAL, INC.~~

~~(former name of registrant as specified in its charter)~~

Delaware		95-3261426
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

~~433 N. Camden Drive~~, ~~Suite 600~~195 South Robertson Blvd. Beverly Hills, California		~~90210~~90211
(Address of principal executive offices)		(Zip Code)

(310) 926-2643

(Registrant’s telephone number, including area code)

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

Title of each class		Trading Symbol		Name of each exchange on which registered
None		N/A		N/A

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☒ Emerging growth company ☒

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 whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of ~~Common Stock,~~common stock, as of the latest practicable date.

~~35,758,149~~ 69,693,274 shares of ~~Common Stock,~~common stock, $0.000001 par value, as of ~~November 12, 2021~~May 13, 2022

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION:

Item 1.	Financial Statements	1

	Condensed Consolidated Balance Sheets as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021 (unaudited)	12

	Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2022 and ~~Nine months Ended September 30,~~ 2021 ~~and 2020~~ (unaudited)	23

	Condensed Consolidated Statements of Stockholders’ Equity for the Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ (unaudited)	34

	Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ (unaudited)	45

	Notes to Condensed Consolidated Financial Statements (unaudited)	56

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1719

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2325

Item 4.	Controls and Procedures	2325

PART II OTHER INFORMATION:

Item 1.	Legal Proceedings	2426

Item 1A.	Risk Factors	2426

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2426

Item 3.	Defaults Upon Senior Securities	2426

Item 4.	Mine Safety Disclosures	2426

Item 5.	Other Information	2426

Item 6.	Exhibits	2426

	Signatures	2527

EVmo, Inc.

Consolidated Financial Statements

For the Three Months Ended March 31, 2022 and 2021 (unaudited)

Contents

	Page
Financial Statements:

Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021	2

Consolidated Statements of Operations for the Three Months ended March 31, 2022 and 2021	3

Consolidated Statement of Stockholders’ Equity for the Three Months ended March 31, 2022 and 2021	4

Consolidated Statements of Cash Flows for the Three Months ended March 31, 2022 and 2021	5

Notes to Consolidated Financial Statements	6

ii1

~~PART I – FINANCIAL INFORMATION~~

~~Item 1.~~

EVmo, Inc.

Condensed Consolidated Balance Sheets

As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021

	September 30,			December 31,				March 31,			December 31,
	2021			2020				2022			2021
	(unaudited)							(unaudited)
ASSETS
Current Assets:
Cash	$	3,540,212		$	72,890		$	10,949,709		$	1,853,928
Accounts receivable		635,736			119,239			764,478			751,450
Prepaid expenses		192,492			23,861			310,818			609,701
Deferred offering costs		479,330			-			-			862,855
Total current assets		4,847,770			215,990			12,025,005			4,077,934

Property and equipment, net		46,471			1,908			44,731			45,601
Rental vehicles, net		10,366,373			6,196,433			8,292,568			8,887,319
Right of use asset		180,860			-			142,791			149,759
Other assets		100,000			200,000			-			100,000
TOTAL ASSETS	$	15,541,474		$	6,614,331		$	20,505,095		$	13,260,613

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:
Accounts payable (including $670,047 and $590,176 to related party)	$	2,849,876		$	1,157,299
Accounts payable (including $207,135 and $670,047 to related party)							$	1,672,033		$	3,784,315
Accrued expenses		1,097,658			961,704			837,044			1,156,265
Notes payables, current (net of discount of $0 and $1,973)		156,225			666,132
Notes payables, current (net of discount of $0 and $0)								312,500			156,225
Customer deposit - related party		-			150,000			-			-
Advance from related parties		-			100,000			-			-
Finance lease obligations, current		1,920,254			1,426,425			1,616,586			1,810,374
Operating lease obligations, current		138,630			-			117,432			143,894
Total current liabilities		6,162,643			4,461,560			4,555,595			7,051,073

Note payable, net of current portion (net of discount of $1,316,029 and $0)		6,027,746			149,414
Note payable, net of current portion (net of discount of $1,246,566)								5,940,934			6,097,209
Finance lease obligations, net of current portion		2,495,616			926,453			2,041,655			2,178,836
Operating lease obligations, net of current portion		50,996			-			-			12,988
TOTAL LIABILITIES		14,737,001			5,537,427			12,538,184			15,340,106

Commitments and contingencies		-			-			-			-

Series B Preferred stock, $0.000001 par value; 230,550 shares authorized; 230,375 and nil shares issued and outstanding		2,303,750			-
Series B Preferred stock, $0.000001 par value; 230,550 shares authorized; nil and 230,375 shares issued and outstanding								-			2,303,750

STOCKHOLDERS’ EQUITY
Preferred stock, $0.000001 par value; 10,000,000 shares authorized; nil shares issued and outstanding		-			-			-			-
Common stock, $0.000001 par value; 90,000,000 shares authorized; 35,758,149 and 31,981,374 shares issued and outstanding		36			32
Common stock, $0.000001 par value; 90,000,000 shares authorized; 67,367,924 and 35,769,524 shares issued and outstanding								67			36
Additional paid-in capital		38,206,344			29,750,864			53,135,766			39,275,591
Accumulated deficit		(39,705,657	)		(28,673,992	)		(45,168,922	)		(43,658,870	)
Total stockholders’ equity		(1,499,277	)		1,076,904			7,966,911			(4,383,243	)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	15,541,474		$	6,614,331		$	20,505,095		$	13,260,613

The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

EVmo, Inc.

Condensed Consolidated Statements of Operations

For the Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ (unaudited)

Three Months Ended
September 30,

Nine Months Ended
September 30,

2021 2020 2021 2020

Revenue $ 2,724,180 $ 2,070,821 $ 7,670,795 $ 5,399,018

Cost of revenue 2,285,878 1,194,957 5,982,075 3,891,307

Gross profit 438,302 875,864 1,688,720 1,507,711

Operating expenses:
Selling and marketing expenses 26,565 113,904 257,129 324,546
Product development 46,500 - 106,766 -
General and administrative expenses 3,218,912 1,088,152 6,151,507 3,845,768
Total operating expenses 3,291,977 1,202,056 6,515,402 4,170,314

Loss from operations (2,853,675 ) (326,192 ) (4,826,682 ) (2,662,603 )

Other income (expense):
Interest and financing costs (2,007,194 ) (65,292 ) (6,296,524 ) (212,943 )
Other income 83,541 - 83,541 -
Gain on forgiveness of debt - - 8,000 -
Total other income (expense) (1,923,653 ) (65,292 ) (6,204,983 ) (212,943 )

Net loss $ (4,777,328 ) $ (391,484 ) $ (11,031,665) $ (2,875,546 )

Weighted average shares outstanding :
Basic 35,715,024 31,981,374 34,819,334 30,828,676
Diluted 35,715,024 31,981,374 34,819,334 30,828,676

Loss per share
Basic $ (0.13 ) $ (0.01 ) $ (0.32 ) $ (0.09 )
Diluted $ (0.13 ) $ (0.01 ) $ (0.32 ) $ (0.09 )
~~The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.~~
2
~~EVmo, Inc.~~
~~Condensed Consolidated Statements of Stockholders’ Equity~~
~~For the Three and Nine Months Ended September 30, 2021 and 2020 (unaudited)~~

Additional Total
Common Stock Paid-in Accumulated Stockholders’
Shares Amount Capital Deficit Equity (Deficit)
Balance, December 31, 2020 31,981,374 $ 32 $ 29,750,864 $ (28,673,992 ) $ 1,076,904

Issuance of common stock for cash 100,000 - 50,000 - 50,000
Issuance of common stock for exercise of stock options 35,000 - 15,400 - 15,400
Issuance of common stock for cashless exercise of stock options 960,550 1 (1 ) - -
Issuance of common stock for settlement of litigation 225,000 - 1,103,750 - 1,103,750
Value of warrants issued with note payable
Issuance of common stock for conversion of convertible debt 1,000,000 1 499,999 - 500,000
Issuance of common stock for settlement agreement 825,000 1 3,240,599 - 3,240,600
Issuance of common stock for financing cost 600 - 1,440 - 1,440
Beneficial conversion feature associated with convertible debt - - 30,000 - 30,000
Value of warrants issued with convertible debt
Fair value of warrants issued for financing costs
Stock option expense - - 193,587 - 193,587
Net loss - - - (4,417,663 ) (4,417,663 )

Balance, March 31, 2021 35,127,524 35 34,885,638 (33,091,655 ) 1,794,018

Issuance of common stock for exercise of stock options 260,000 - 71,700 - 71,700
Issuance of common stock for settlement of litigation - - -
Issuance of common stock for conversion of convertible debt - -
Issuance of common stock for settlement agreement - -
Issuance of common stock for financing cost - -
Beneficial conversion feature associated with convertible debt - - 810,634 - 810,634
Value of warrants issued with convertible debt - - 488,133 - 488,133
Fair value of warrants issued for financing costs - - 457,417 - 457,417
Stock option expense - - 104,387 - 104,387
Net loss - - - (1,836,674 ) (1,836,674 )

Balance, June 30, 2021 35,387,524 35 36,817,909 (34,928,329 ) 1,889,615

Issuance of common stock for exercise of stock options 26,875 - 5,778 - 5,778
Issuance of common stock for cashless exercise of stock options 312,500 1 (1 ) - -
Issuance of common stock for settlement of litigation 31,250 - 42,018 - 42,018
Value of warrants issued with note payable - -
778,697
-
778,697

Fair value of warrants issued for financing costs - - 503,690 - 503,690
Stock option expense - - 58,253 - 58,253
Net loss - - - (4,777,328 ) (4,777,328 )

Balance, September 30, 2021 35,758,149 $ 36 $
38,206,344
$ (39,705,657 ) $ (1,499,277 )

Balance, December 31, 2019 29,427,803 $ 29 $ 28,735,894 $ (25,171,915 ) $ 3,564,008

Stock option expense - - 457,242 - 457,242
Net loss - - - (1,761,220 ) (1,761,220 )

Balance, March 31, 2020 29,427,803 29 29,193,136 (26,933,135 ) 2,260,030

Issuance of common stock for cash 2,553,571 3 274,997 275,000
Net loss - - - (722,842 ) (722,842 )

Balance, June 30, 2020 31,981,374 32 29,468,133 (27,655,977 ) 1,812,188
Balance 31,981,374 32 29,468,133 (27,655,977 ) 1,812,188

Stock option expense - - 240,244 - 240,244
Net loss - - (391,484 ) (391,484 )

Balance, September 30, 2020 31,981,374 $ 32 $ 29,708,377 $ (28,047,461 ) $ 1,660,948
Balance 31,981,374 $ 32 $ 29,708,377 $ (28,047,461 ) $ 1,660,948
2022 2021
Three Months Ended March 31,
2022 2021

Revenue $ 2,459,709 $ 2,294,532

Cost of revenue 1,972,063 1,780,903

Gross profit 487,646 513,629

Operating expenses:
Selling and marketing expenses 64,336 165,748
Product development 19,000 9,500
General and administrative expenses 1,462,325 1,439,101
Total operating expenses 1,545,661 1,614,349

Loss from operations (1,058,015 ) (1,100,720 )

Other income (expense):
Interest and financing costs (452,037 ) (3,324,943 )
Other income - -
Gain on forgiveness of debt - 8,000
Total other income (expense) (452,037 ) (3,316,943 )

Net loss $ (1,510,052 ) $ (4,417,663 )

Weighted average shares outstanding :
Basic 72,645,391 33,383,431
Diluted 72,645,391 33,383,431

Loss per share
Basic $ (0.02 ) $ (0.13 )
Diluted $ (0.02 ) $ (0.13 )

The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

3

EVmo, Inc.
Condensed Consolidated Statements of ~~Cash Flows~~Stockholders’ Equity
For the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ (unaudited)

2021 2020

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (11,031,665 ) $ (2,875,546 )
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 1,525,332 1,047,075
Stock option expense 356,227 697,486
Amortization of debt discounts 1,643,408 27,719
Common stock issued for financing costs 1,440 -
Preferred stock issued for financing costs 53,750 -
Common stock issued for settlement agreement 3,240,600 -
Common stock issued for litigation settlement 42,018 -
Gain on forgiveness of debt (8,000 ) -
Fair value of warrants issued for financing costs 961,107 -
Operating lease expense 77,361 -
Changes in operating assets and liabilities:
Accounts receivable (516,497 ) 5,993
Prepaid expenses and other assets (68,631 ) 350,927
Accounts payable 1,656,997 908,051
Accrued expenses 830,954 26,838
Customer deposit - related party (150,000 ) -
Operating lease liability (68,595 ) -
Net cash used in operating activities (1,454,194 ) 188,543

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (47,051 ) -
Net cash used in investing activities (47,051 ) -

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock 50,000 275,000
Proceeds from exercise of stock options 92,878 -
Proceeds from advance from related parties 503,766 200,000
Repayment of advance from related parties (603,766 ) (150,000 )
Proceeds from convertible note payable 2,500,000 -
Proceeds from notes payable, net 6,900,000 342,675
Repayment of notes payable (809,519 ) (10,000 )
Repayment of finance lease obligations (3,629,792 ) (2,017,915 )
Payment of deferred offering costs (35,000 ) -
Net cash provided by (used in) financing activities 4,968,567 (1,360,240 )

NET INCREASE (DECREASE) IN CASH 3,467,322 (1,171,697 )

CASH, BEGINNING OF PERIOD 72,890 1,256,429

CASH, END OF PERIOD $ 3,540,212 $ 84,732

CASH PAID FOR:
Interest $ 157,809 $ 185,224
Income taxes $ - $ -

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES
Payment of accounts payable/accrued expenses with common stock $ 1,103,750 $ -
Finance lease obligations $ 5,692,784 $ 3,400,922
Shares Amount Capital Deficit (Deficit)
Additional Total Stockholders’
Common Stock Paid-in Accumulated Equity
Shares Amount Capital Deficit (Deficit)
Balance, December 31, 2021 35,769,524 $ 36 $ 39,275,591 $ (43,658,870 ) $ (4,383,243 )
-
Issuance of common stock for cash 27,400,000 28 13,700,000 13,700,028
Issuance of common stock for exercise of stock options 91,500 1 69,996 69,997
Issuance of common stock for conversion of convertible debt 128,125 1 64,063 64,064
Issuance of common stock for financing cost 535,967 1 - 1
Stock option expense 26,116 26,116
Net loss (1,510,052 ) (1,510,052 )

Balance, March 31, 2022 65,725,116 67 53,135,766 (45,168,922 ) 7,966,911

Balance, December 31, 2020 31,981,374 $ 32 $ 29,750,864 $ (28,673,992 ) $ 1,076,904

Issuance of common stock for cash 100,000 - 50,000 - 50,000
Issuance of common stock for exercise of stock options 35,000 - 15,400 - 15,400
Issuance of common stock for cashless exercise of stock options 960,550 1 (1 ) - -
Issuance of common stock for settlement of litigation 225,000 - 1,103,750 - 1,103,750
Issuance of common stock for conversion of convertible debt 1,000,000 1 499,999 - 500,000
Issuance of common stock for settlement agreement 825,000 1 3,240,599 - 3,240,600
Issuance of common stock for financing cost 600 - 1,440 - 1,440
Beneficial conversion feature associated with convertible debt - - 30,000 - 30,000
Stock option expense - - 193,587 - 193,587
Net loss - - - (4,417,663 ) (4,417,663 )

Balance, March 31, 2021 35,127,524 35 34,885,638 (33,091,655 ) 1,794,018

The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.
4

EVmo, Inc.
Condensed Consolidated Statements of Cash Flows
For the Three Months Ended March 31, 2022 and 2021 (unaudited)

2022 2021

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (1,510,052 ) $ (4,417,663 )
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 213,632 463,251
Stock option expense 26,116 193,587
Amortization of debt discounts - 31,789
Common stock issued for financing costs 32 1,440
Common stock issued for settlement agreement - 3,240,600
Gain on forgiveness of debt - (8,000 )
Fair value of warrants issued for financing costs - -
Leased Vehicles 381,989 18,708
Changes in operating assets and liabilities:
Accounts receivable (13,028 ) 77,604
Prepaid expenses and other assets 298,883 (31,815 )
Other Assets 106,968 -
Accounts payable (2,112,283 ) 402,141
Accrued expenses (319,221 ) (12,776 )
Customer deposit - related party - 125,000
Operating lease liability (39,450 ) (6,654 )
Net cash used in operating activities (2,966,414 ) 77,212

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment - (47,051 )
Net cash used in investing activities - (47,051 )

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock 13,834,059 50,000
Proceeds from exercise of stock options - 15,400
Proceeds from advance from related parties - 503,766
Repayment of advance from related parties - (34,485 )
Proceeds from convertible note payable - 500,000
Proceeds from notes payable, net - (20,551 )
Repayment of notes payable - -
Redemption of Preferred Stock (2,303,750 ) -
Repayment of finance lease obligations (330,969 ) (961,705 )
Payment of deferred offering costs 862,855 -
Net cash provided by (used in) financing activities 12,062,195 52,425

NET INCREASE (DECREASE) IN CASH 9,095,781 82,586

CASH, BEGINNING OF PERIOD 1,853,928 72,890

CASH, END OF PERIOD $ 10,949,709 $ 155,476

CASH PAID FOR:
Interest $ 328,566 $ 51,114
Income taxes $ - $ -

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES
Payment of accounts payable/accrued expenses with common stock $ 1,103,750 $ -
Finance lease obligations $ 3,658,241 $ 3,705,417
The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.
5
EVmo, Inc.
Notes to ~~Condensed~~ Consolidated Financial Statements
For ~~the Nine months~~Year Three Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ (unaudited)
Note 1 - Organization and Basis of Presentation

Organization and Line of Business

EVmo, Inc. ~~(the~~(“EVmo” or the “Company”) was incorporated on June 21, 2016under the laws of the state of Delaware originally as a limited liability company and subsequently converted to a Delaware C corporation. The Company was originally incorporated under the name of YayYo, Inc. and changed its name to Rideshare Rental, Inc. on September 11, 2020. On March 1, 2021, the Company changed its name from Rideshare Rental, Inc. to EVmo, Inc. ~~The accompanying financial statements~~
EVmo is a holding company operating principally through two wholly-owned subsidiaries: (i) Rideshare Car Rentals LLC, a Delaware limited liability company (“Rideshare”), and (ii) Distinct Cars, LLC, a Delaware limited liability company (“Distinct Cars”). Rideshare offers an online bookings platform (the “Rideshare Platform”) while Distinct Cars maintains a fleet of passenger vehicles and transit vans for use in the last-mile logistical space for rent to our customers who are ~~retroactively restated~~drivers in the ridesharing and delivery gig industries, while also providing them with insurance coverage and issuing them insurance cards in their own names. This enables such drivers to ~~present~~meet the ~~Company~~vehicle suitability and other requirements of rideshare and delivery gig companies such as Uber, Lyft, DoorDash and Grubhub. Through Rideshare and Distinct Cars, we seek to become a ~~C corporation from June 21, 2016. The Company primarily rents~~leading provider of rental vehicles to drivers ~~for ridesharing Transportation Network Companies (“TNCs”) such as Uber and Lyft, as well as drivers~~ in the ridesharing and delivery ~~gig-economy.~~gig spaces, and an industry leader in supplying transit vans for last-mile logistics. “Gig” generally refers to a labor market characterized by the prevalence of short-term contracts or freelance work as opposed to permanent jobs.

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (GAAP).

~~Risk and Uncertainties~~
Impact of COVID-19 on our Business
On January 30, 2020, the World Health Organization declared the outbreak of the coronavirus disease (COVID-19) a “Public Health Emergency of International Concern,” and on March 11, 2020, ~~the World Health Organization~~it characterized the outbreak as a “pandemic.” In response, numerous states and cities ordered their residents to cease traveling to non-essential jobs and to curtail all unnecessary travel, and similar restrictions were recommended by the federal government. Beginning in the first quarter of 2020, which saw the initial rapid spread of COVID-19, rideshare companies were severely and negatively impacted, as demand plummeted. Consequently, the Company experienced a decline in revenue during the first half of 2020, which had a negative impact on ~~its~~our cash flows, but itwe then saw a positive upward movement in revenue during the second half of 2020, which continued ~~into~~through fiscal 2021. This was consistent with the ~~first half of 2021. In early 2021, several vaccinations for COVID-19 received emergency-use authorization from the Food and Drug Administration, and many~~experience of the ~~lockdown restrictions imposed by state~~TNCs whose drivers we service. According to Bloomberg Second Measure, Uber and ~~local governments, including those~~Lyft sales were up 104% and 84% year-over-year, respectively, in February 2022 from one year earlier, even in spite of the ~~markets~~Delta and Omicron variants that resulted in ~~which~~spikes of infections through periods of 2021.
Given the ~~Company operates, appear to be abating. The pandemic has not yet ended, however, and there have been multiple waves where~~current prevalence of FDA-approved eligible vaccines across most age groups, the marked decrease in the number of COVID-19 infections, hospitalizations and deaths ~~have sharply increased. The Company therefore cannot predict~~in the ~~ultimate impact~~first quarter of 2022, and the resulting easement of pandemic restrictions in our active markets, we are optimistic that COVID-19 ~~may~~will not have a material impact on ~~its business this year,~~our operations in the current fiscal year. However, certain factors- including, for example, a new, more aggressive and ~~possibly beyond.~~deadly variant that is resistant to the vaccines- could reverse the positive trends of recent months and alter our prediction.
Interim financial statements

The unaudited condensed ~~consolidated~~ financial statements are prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The information furnished herein reflects all adjustments, consisting only of normal recurring adjustments, which in the opinion of management are necessary to fairly state the Company’s financial position, the results of its operations, and cash flows for the periods presented. Certain information and footnote disclosures normally present in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America were omitted pursuant to such ~~rules~~results and regulations. The results of operations for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 are not necessarily indicative of the results expected for the year ending December 31, ~~2021.~~2022.
Note 2 – Summary of Significant Accounting Policies

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Distinct Cars ~~LLC~~ and RideShare, ~~Car Rentals, LLC.~~and a third subsidiary, EV Vehicles, LLC, a Delaware limited liability company that is not yet operational. All significant intercompany transactions and balances have been eliminated.
6
EVmo, Inc.
Notes to Consolidated Financial Statements
For Year Three Months Ended March 31, 2022 and 2021 (unaudited)

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. It is possible that accounting estimates and assumptions may be material to the Company due to the levels of subjectivity and judgment involved.

5
~~EVmo, Inc.~~
~~Notes to Condensed Consolidated Financial Statements~~
~~For the Nine months Ended September 30, 2021 and 2020 (unaudited)~~
Cash Equivalents

For the purpose of the statement of cash flows, cash equivalents include time deposits, certificate of deposits, and all highly liquid debt instruments with original maturities of three months or less.

Property and Equipment and Rental Vehicles

Property and Equipment and Rental Vehicles are stated at cost. Expenditures for maintenance and repairs are charged to earnings as incurred; additions, renewals and betterments are capitalized. When equipment is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gain or loss is included in operations. Depreciation of equipment and rental vehicles is provided using the straight-line method for substantially all assets with estimated lives as follows:
Schedule of Estimated Lives of Equipment
Computer equipment 5 years
Officer furniture 7 years
Leasehold improvements 15 years or term of lease whichever is less
Vehicles 5 years

Long-Lived Assets

The Company applies the provisions of ASC Topic 360, Property, Plant, and Equipment, which addresses financial accounting and reporting for the impairment or disposal of long-lived assets. ASC 360 requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amounts. In that event, a loss is recognized based on the amount by which the carrying amount exceeds the fair value of the long-lived assets. Loss on long-lived assets to be disposed of is determined in a similar manner, except that fair values are reduced for the cost of disposal. Based on its review at ~~September 30, 2021,~~March 31, 2022 the Company determined that no impairment charge was necessary.

Revenue Recognition

The Company recognizes all of its material revenue from renting its fleet of cars to TNC drivers. Revenue is recognized generally on a weekly basis based on the rental agreements. The Company recognizes revenue in accordance with FASB ASC 606, Revenue From Contracts with Customers.

Income Taxes

The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes. ASC 740 requires a company to use the asset and liability method of accounting for income taxes, whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all of, the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

7
EVmo, Inc.
Notes to Consolidated Financial Statements
For Year Three Months Ended March 31, 2022 and 2021 (unaudited)
Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is ~~recorded.~~recorded. The adoption had no effect on the Company’s consolidated financial statements.

Stock-Based Compensation

The Company records stock-based compensation in accordance with FASB ASC Topic 718, Compensation – Stock Compensation. FASB ASC Topic 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the employee’s requisite service period. The Company recognizes in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees and non-employees. There were ~~2,737,500~~4,582,842 warrants and ~~758,125~~694,625 options outstanding as of ~~September 30, 2021~~March 31, 2022 and 1,631,250 warrants and ~~3,221,000~~ 1,755,000options outstanding as of ~~September 30, 2020.~~
6
~~EVmo, Inc.~~
~~Notes to Condensed Consolidated Financial Statements~~
~~For the Nine months Ended September 30, 2021 and 2020 (unaudited)~~March 31, 2021.

Basic and Diluted Earnings Per Share

Earnings per share is calculated in accordance with ASC Topic 260, Earnings Per Share. Basic earnings per share (“EPS”) is based on the weighted average number of common shares outstanding. Diluted EPS is based on the assumption that all dilutive securities are converted. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase shares of the Company’s common stock, par value $0.000001 (the “Common Stock”) at the average market price during the period. Due to the net loss incurred potentially dilutive instruments would be anti-dilutive. Accordingly, diluted loss per share is the same as basic loss for all periods presented. There were ~~3,495,625~~5,287,467 and ~~4,852,250~~3,386,250 potentially dilutive options and warrants outstanding at ~~September 30,~~March 31, 2022 and 2021, ~~and 2020, respectively, and~~ ~~750,000~~ ~~shares potentially issuable upon the conversion of outstanding shares of Series B Preferred Stock at September 30, 2021.~~respectively.

Advertising Costs

The Company expenses the cost of advertising as incurred. Advertising costs for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ were $~~257,129~~64,336 and $~~324,546~~165,748, respectively.

Fair Value Measurements

The Company applies the provisions of ASC 820-10, “Fair Value Measurements and Disclosures.” ASC 820-10 defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The three levels of valuation hierarchy are defined as follows:

● Level 1 inputs to the valuation methodology are quoted, unadjusted prices for identical assets or liabilities in active markets.

● Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, as well as other than quoted prices for identical assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

● Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.

For certain financial instruments, the carrying amounts reported in the balance sheets for cash and current liabilities, including convertible notes payable, each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest.

8
EVmo, Inc.
Notes to Consolidated Financial Statements
For Year Three Months Ended March 31, 2022 and 2021 (unaudited)
At ~~September 30,~~March 1, 2022 and 2021, ~~and December 31, 2020,~~ the Company did not identify any liabilities that are required to be presented on the balance sheet at fair value.

Recent Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes which amends ASC 740 Income Taxes (ASC 740). This update is intended to simplify accounting for income taxes by removing certain exceptions to the general principles in ASC 740 and amending existing guidance to improve consistent application of ASC 740. This update is effective for fiscal years beginning after December 15, 2021. The guidance in this update has various elements, some of which are applied on a prospective basis and others on a retrospective basis with earlier application permitted. The Company is currently evaluating the effect of this ASU on the Company’s consolidated financial statements and related disclosures.
7
~~EVmo, Inc.~~
~~Notes to Condensed Consolidated Financial Statements~~
~~For the Nine months Ended September 30, 2021 and 2020 (unaudited)~~

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40)—Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock. For convertible instruments with conversion features that are not required to be accounted for as derivatives under Topic 815, Derivatives and Hedging, or that do not result in substantial premiums accounted for as paid-in capital, the embedded conversion features no longer are separated from the host contract. ASU 2020-06 also removes certain conditions that should be considered in the derivatives scope exception evaluation under Subtopic 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity, and clarify the scope and certain requirements under Subtopic 815-40. In addition, ASU 2020-06 improves the guidance related to the disclosures and earnings-per-share (EPS) for convertible instruments and contract in an entity’s own equity. ASU 2020-06 is effective for public business entities that meet the definition of a SEC filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, which includes the Company, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The FASB specified that an entity should adopt the guidance as of the beginning of its annual fiscal year. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.

Management does not believe that any recently issued, but not yet effective, accounting standards could have a material effect on the accompanying financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under the circumstances.
Note 3 – Property and Equipment

At ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, property and~~2021 equipment consisted of the following:
Schedule of Property and Equipment
September 30, December 31, March 31, December 31,
2021 2020 2022 2021

Computer equipment $ 6,046 $ 6,046 $ 6,046 $ 6,046
Office furniture 17,401 - 17,401 17,401
Leasehold improvement 29,650 - 29,650 29,650
53,097 6,046
Property and Equipment 53,097 53,097
Less accumulated depreciation (6,626 ) (4,138 ) (8,366 ) (7,496 )
Equipment, net $ 46,471 $ 1,908 $ 44,731 $ 45,601

Depreciation expense for equipment for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ was $~~2,488~~870 and $~~1,115~~826, respectively.
9
EVmo, Inc.
Notes to Consolidated Financial Statements
For Year Three Months Ended March 31, 2022 and 2021 (unaudited)

Note 4 – Rental Vehicles
At ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021 all of the Company’s rental vehicles consisted of the following:
Schedule of Rental Vehicles
September 30, December 31, March 31, December 31,
2021 2020 2022 2021

Rental vehicles $ 14,760,669 $ 9,067,885 $ 13,132,629 $ 13,514,619
14,760,669 9,067,885
Rental vehicles, gross 13,132,629 13,514,619
Less accumulated depreciation (4,394,296 ) (2,871,452 ) (4,840,061 ) (4,627,300 )
Rental vehicles, net $ 10,366,373 $ 6,196,433 $ 8,292,568 $ 8,887,319

The Company’s ~~leased assets, consisting of~~rental vehicles are depreciated over their estimated useful life of five years. Depreciation expense for leased assets for the ~~nine months~~years ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ was $~~1,522,844~~519,533 and $~~1,045,960~~462,425, respectively. ~~The lease~~A majority of the rental vehicles are leased with terms are generally for 3012 to 36 months and the Company has the right to purchase the ~~leased assets~~vehicles at the end of the lease ~~terms for generally a nominal amount.~~
8
~~EVmo, Inc.~~
~~Notes~~terms. The reduction in Rental Vehicles Asset balance was due to ~~Condensed Consolidated Financial Statements~~
~~For~~ the ~~Nine months Ended September 30, 2021 and 2020 (unaudited)~~sale of 36 Transit Vans in Q1 2022.

Note 5 – Notes Payable
Notes payable at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021 consisted of the following:
Schedule of Notes Payable
September 30, December 31, March 31, December 31,
2021 2020 2022 2021
$ - $ 304,667
Notes payable to individual investors; accrue interest at 8% per annum; principal payments equal to 1/12 of original balance plus interest due quarterly; due from dates ranging from August 9, 2020 to March 26, 2021; unsecured $ - $ 304,667
Notes payable to individual investors; accrue interest at 8% per annum; principal payments equal to 1/12 of original balance plus interest due quarterly; due from dates ranging from August 9, 2020 to March 26, 2021; unsecured $ - $ -
Note payable to the Small Business Administration. The note bears interest at 3.75% per annum, requires monthly payments of $731 after 24 months from funding and is due 30 years from the date of issuance. - 149,414 - -
Note payable issued under the Paycheck Protection Program of the Coronavirus Aid, Relief and Economic Security (“CARES”) Act in the amount of $192,775. The loan has terms of 24 months and accrues interest at 1% per annum. During the year ended December 31, 2020, $184,775 of this loan has been forgiven as provided for in the CARES Act. - 8,000
Note payable issued under the Paycheck Protection Program of the Coronavirus Aid, Relief and Economic Security (“CARES”) Act in the amount of $192,775. The loan has terms of 24 months and accrues interest at 1% per annum. During the years ended December 31, 2021 and 2020, $8,000 and $184,775, respectively, of this loan has been forgiven as provided for in the CARES Act. - -
Notes payable to a finance company, default interest at 14% per annum; monthly principal payments ranging from $10,000 to $40,000 with unpaid principal due on December 15, 2021 - 355,438 - -
Notes payable to a finance company, interest at LIBOR plus 10% per annum; monthly principal payments of 0.4166% of principal balance beginning August 1, 2022, with unpaid principal due on July 9, 2026 (A) 7,500,000 -
Notes payable to a finance company, interest at LIBOR plus 10% per annum; monthly principal payments of 0.4166% of principal balance beginning August 1, 2022, with unpaid principal due on July 9, 2026 (A) 7,500,000 7,500,000
Total notes payable 7,500,000 817,519 7,500,000 7,500,000
Unamortized debt discount (1,316,029 ) (1,973 ) (1,246,566 ) (1,246,566 )
Notes payable, net discount 6,183,971 815,546 6,253,434 6,253,434
Less current portion (156,225 ) (666,132 ) (312,500 ) (156,225 )
Long-term portion $ 6,027,746 $ 149,414 $ 5,940,934 $ 6,097,209

(A) On July 9, 2021 (the “Closing Date”), the Company entered into a Term Loan, Guarantee and Security Agreement (the “Term Loan Agreement”) with EICF Agent LLC (“EICF”), as agent for the lenders, and Energy Impact Credit Fund I, LP, as lender (the “Lender”), providing for a secured term loan facility in an aggregate principal amount of up to $15.0 million (collectively, the “Term Loans”), consisting of a $7.5 million closing date term loan facility (the “Closing Date Term Loan”) and up to $7.5 million of borrowings under a delayed draw term loan facility (the “Delayed Draw Term Loan Facility”). The Closing Date Term Loan was fully drawn on the Closing Date, while the Delayed Draw Term Loan Facility is available upon the satisfaction of certain conditions precedent specified in the Term Loan Agreement. The Term Loan Agreement matures on July 9, 2026. Borrowings under the Term Loan Agreement bear interest at the London Interbank Offered Rate (“LIBOR”), plus a margin of 10.0%. As a condition precedent to the Agent and the Lender entering into the Term Loan Agreement, the Company issued to the Lender a common stock purchase warrant, dated as of the Closing Date (the “Warrant”), which grants the Lender the right to purchase up to1.5 million shares of the common stock of the Company, par value $0.000001 ~~(the “Common Stock”)~~, at an exercise price of $2.10, subject to adjustment as set forth in the Warrant. The Warrant is subject to vesting, with 450,000 shares of Common Stock exercisable as of the Closing Date and the remainder exercisable only in the event that the Company borrows under the Delayed Draw Term Loan Facility or fails to consummate a qualifying equity transaction on or before October 7, 2021. The Warrant has no expiration date. In addition, in October 2021, the Company was required to issue to Lender an additional warrant for 900,000 shares of common stock (the “Additional Warrant”) as a penalty since the Company was unable to raise equity capital within 90 days of the date of this agreement. Upon completion of the equity capital raise completed on January 6, 2022, anti-dilution adjustments were made to the issued warrants. The Warrant for 450,000 common shares at an exercise price of $2.10 was adjusted to one for 711,656 shares at an exercise price of $1.33 and the Additional Warrant for 900,000 common shares at an exercise price was adjusted to one for 1,174,311 shares at an exercise price of $0.71.

910

EVmo, Inc.
Notes to ~~Condensed~~ Consolidated Financial Statements
For ~~the Nine months~~Year Three Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ (unaudited)

In connection with the Company’s entry into the Term Loan Agreement, the Company entered into an exchange agreement, dated as of July 8, 2021 (the “Exchange Agreement”), with the holder (the “Holder”) of the Company’s 12.5% OID convertible promissory notes ~~(See Note 6)~~ due January 12, 2022 issued on April 12, 2021 (the “Prior Notes”).
~~In connection with~~ This Exchange Agreement resulted in the issuance of ~~this note payable,~~preferred stock that was later either converted to common stock or redeemed after completion of the ~~Company also~~equity capital raise in January 2022. On January 22, 2022, 110,325 of Series B preferred stock was converted to 3,152,143 of common stock at $0.35 per share. On March 22, 2022, 110,525 of Series B preferred stock was converted to 3,157,857 of common stock at $0.35 per share. The remaining outstanding Series B preferred stock, 9,525 shares,was redeemed and a final warrant was issued ~~450,000~~ ~~warrants~~ to ~~purchase~~the Holder for 128,125 common shares ~~of its Common Stock with~~at an exercise price of $~~2.10~~0.50 per ~~shares. The aggregate relative fair value of these warrants was $778,697~~ ~~and was recorded as a discount on the note payable and as additional paid in capital. In addition, the Company incurred $600,000~~ ~~of cost related to this note payable. The total discount of $1,378,697~~ ~~is being amortized over the term of the notes payable.~~share.

A ~~roll forward~~rollforward of notes payable from December 31, ~~2020~~2021 to ~~September 30, 2021~~March 31, 2022 is below:
Schedule of Outstanding Notes Payable

Notes payable, December 31, 2020 $ 815,546
Notes payable, December 31, 2021 $ 7,500,000
Issued for cash 7,500,000 -
Payment of cost associated with issuance of note payable (600,000 )
Debt discount related to notes payable (778,697 )
Lease obligation converted to note payable -
Forgiveness of note payable (8,000 ) -
Repayments (809,519 ) -
Amortization of debt discounts 64,641 -
Notes payable, September 30, 2021 $ 6,183,971
Notes payable, March 31, 2022 7,500,000
Future payments under note payable obligations are as follows:
Schedule of Future Payments Under Note Payable Obligations
Years ending December 31,
2022 $ 156,225
2023 374,940
2024 374,940
2025 374,940
2026 6,218,955
Thereafter
Notes payable $ 7,500,000
Note 6 – Convertible Notes
~~On January 8, 2021, the Company, issued a stand-alone $500,000~~ convertible promissory note to Mr. John Gray, principal of one of the Company’s largest stockholders, the Gray Mars Venus Trust, Arizona 2015, an Arizona asset management limited partnership. The convertible note accrues interest at a fixed rate of 6~~% and will mature on~~ ~~January 6, 2022. Any unpaid principal balance on the convertible note may be converted at any time, at the option of Mr. Gray, into shares of the Company’s Common Stock at a price of $0.50~~ ~~per share. The Company recorded a beneficial conversion feature associated with this convertible note of $30,000~~ ~~which was recorded as a debt discount. On February 12, 2021, Mr. Gray converted the full amount of the convertible promissory note into~~ ~~1,000,000~~ ~~shares of the Company’s Common Stock.~~

On April 12, 2021, the Company, entered into a securities purchase agreement with a certain investor in connection with the issuance, as of that same date, of a 12.5% original issue discount convertible promissory note and a common stock purchase warrant. The note has an original principal amount of $2,250,000, with an original issue discount of $250,000. It bears interest at a fixed rate of 10%, is convertible into shares of Common Stock at a price of $3.00 per share (subject to adjustment as set forth in the note), and matures on January 12, 2022. The warrant grants the right to purchase 187,500 shares of common stock at an exercise price of $3.00, subject to adjustment as set forth therein, and is exercisable at any time within five years of the date of issuance. The agreement provides that additional warrants, each for 93,750 shares of common stock with an exercise price of $3.00 per share, will be issued by the Company to the investor on the 12^th day of each month that the note remains outstanding. Both the note and the warrant include anti-dilution provisions in which the conversion price of the note and the exercise price of the warrant will be reduced to equal the conversion or exercise price, as applicable, of any subsequently-issued derivative security to acquire shares of common stock, or their equivalent, should that conversion or exercise price be lower than that of the note or the warrant. To account for the note and warrant, the Company first determined the value of the note and the fair value of the detachable warrants issued in connection with this convertible note. The estimated value of the warrants of $623,373 was determined using the Black-Scholes option pricing model and the following assumptions: term of five years, a risk free interest rate of .~~.089~~089%, a dividend yield of 0% and volatility of 190%. The face amount of the convertible note of ~~$2,250,000~~$2,250,000 was proportionately allocated to the convertible note and the warrant in the amount of $1,761,866 and $488,134, respectively. Since the Company’s stock price exceeded the conversion price on the transaction date, there is an embedded beneficial conversion feature present in the convertible note of $810,633. The combined discount of $1,298,767 plus the original issue discount are recorded as a debt discount to the convertible note and are being amortized over the year life of the note. In July 2021, the Company and noteholder agreed to convert the convertible note into 230,250 shares of the Company’s Series B Preferred Stock.

As described in Note 5, in connection with the Company’s entry into the Term Loan Agreement, the Company also entered into the Exchange Agreement. This Exchange Agreement resulted in the issuance of preferred stock that was later either converted to common stock or redeemed after completion of the equity capital raise in January 2022. On January 22, 2022, 110,325 of Series B preferred stock was converted to 3,152,143 of common stock at $0.35 per share. On March 22, 2022, 110,525 of Series B preferred stock was converted to 3,157,857 of common stock at $0.35 per share. The remaining outstanding Series B preferred stock, 9,525 shares, was redeemed and a final warrant was issued to the Holder for 128,125 common shares at an exercise price of $0.50 per share.
1011

EVmo, Inc.
Notes to ~~Condensed~~ Consolidated Financial Statements
For ~~the Nine months~~Year Three Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ (unaudited)

A roll forward of convertible notes from March 31, 2022 to December 31, ~~2020 to September 30,~~ 2021 is below:
Schedule of ~~Outstanding~~ Convertible Notes ~~Payable~~
Convertible notes, December 31, ~~2020~~2021 $ -
Issued for cash ~~2,500,000~~-
Issued for original issue discount ~~250,000~~-
Debt discount related to convertible notes ~~(1,578,767~~- )
Conversion to common stock ~~(500,000~~- )
Conversion to preferred stock ~~(2,250,000~~- )
Amortization of debt discounts ~~1,578,767~~-
Convertible notes, ~~September 30, 2021~~March 31, 2022 $ -

Note 7 – Financing Lease Obligations

Lease obligations at ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021 consisted of the following:
Schedule of Lease Obligations
September 30, December 31, March 31, December 31,
2021 2020 2022 2021

Lease obligations $ 4,415,870 $ 2,352,878 $ 3,658,241 $ 3,989,210
Less current portion (1,920,254 ) (1,426,425 ) (1,616,586 ) (1,810,374 )
Long-term portion $ 2,495,616 $ 926,453 $ 2,041,655 $ 2,178,836

A rollforward of lease obligations from December 31, ~~2020~~2021 to ~~September 30, 2021~~March 31, 2022 is below:
Schedule of Outstanding Lease Obligations

Lease obligations, December 31, 2020 $ 2,352,878
Lease obligations, December 31, 2021 $ 3,989,210
New lease obligations 5,692,784 1,303,487
Disposal of leased vehicles (1,229,692 )
Lease obligation converted to note payable -
Payments on lease obligations (3,629,792 ) (405,764 )
Lease obligations, September 30, 2021 $ 4,415,870
Lease obligations, March 31, 2022 $ 3,658,241

Future payments under lease obligations are as follows:
Schedule of Future Lease Obligations
Twelve Months Ending September 30,

Years Ending December 31,
2022 $ 2,033,761 $ 1,310,334
2023 1,500,065 1,823,126
2024 1,058,833 615,200
2025 406,075
2026 71,969
Total payments 4,592,659 4,226,714
Amount representing interest (176,789 ) (568,463 )
Lease obligation, net $ 4,415,870 $ 3,658,241
12
EVmo, Inc.
Notes to Consolidated Financial Statements
For Year Three Months Ended March 31, 2022 and 2021 (unaudited)

Note 8 –Operating Lease Obligations

The Company determines whether a contract is or contains a lease at inception of the contract and whether that lease meets the classification criteria of a finance or operating lease. When available, the Company uses the rate implicit in the lease to discount lease payments to present value; however, the Company’s leases do not provide a readily determinable implicit rate. Therefore, the Company discounts lease payments based on an estimate of its incremental borrowing rate.

The Company leases its corporate office space under an operating lease that expires in 2023. The Company accounts for this lease under the provisions of ASC 842 Leases.

11
~~EVmo, Inc.~~
~~Notes to Condensed Consolidated Financial Statements~~
~~For the Nine months Ended September 30, 2021 and 2020 (unaudited)~~
The table below presents the lease related assets and liabilities recorded on the Company’s consolidated balance sheets as of ~~September 30, 2021:~~March 31, 2022:
Schedule of Operating Lease Obligations
September 30,
Classification on Balance Sheet 2021 Classification on Balance Sheet
March 31,
2021

Assets
Operating lease assets Operating lease right of use assets $ 180,860 Operating lease right of use assets $ 109,953
Total lease assets $ 180,860 $ 109,953

Liabilities
Current liabilities
Operating lease liability Current operating lease liability $ 138,630 Current operating lease liability $ 117,432
Noncurrent liabilities
Operating lease liability Long-term operating lease liability 50,996 Long-term operating lease liability -
Total lease liability $ 189,626 $ 117,432

Lease obligations at ~~September 30, 2021~~March 31, 2022 consisted of the following:
Schedule of Lease Obligation Maturity
Twelve Months Ending September 30, Leases
Years Ending December 31,
2022 $ 157,800 $ 101,432
2023 52,600 13,150
Total payments 210,400 117,432
Less: imputed interest (20,774 )
Total obligation 189,626 -
Less: current portion (138,630 ) (117,432 )
Non-current capital leases obligations $ 50,996 $ -

The lease expense for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 was $~~100,817. The cash paid under operating leases for the nine months ended September 30, 2021 was $92,050~~64,204. At ~~September 30, 2021,~~March 31, 2022, the weighted average remaining lease terms ~~were~~was ~~1.25~~1.0 ~~years~~year and the weighted average discount rate was 15%.
EVmo, Inc.
Notes to Consolidated Financial Statements
For Year Three Months Ended March 31, 2022 and 2021 (unaudited)

Note 89 – Stockholders’ Equity

The Company has authorized 100,000,000shares of capital stock, which consists of 90,000,000shares of ~~Common Stock,~~common stock, $0.000001par value per share, and 10,000,000shares of preferred stock, $0.000001par value per share.

Series B Preferred Stock

Pursuant to the Exchange Agreement (see Note 5), the Holder agreed to exchange the Prior Notes for 230,375shares of Series B convertible preferred stock, par value $0.000001per share (the “Series B Preferred Stock”), and a warrant (the “Exchange Warrant”). The Exchange Warrant ~~grants~~granted the Holder the right to purchase 93,750shares of Common Stock at an exercise price of $3.00, subject to adjustment as set forth therein. The Exchange Warrant is exercisable in full at any time within five years of the date of issuance. Additional warrants on substantially identical terms as the Exchange Warrant ~~will be~~were issued by the Company to the Holder monthly until ~~such time as~~all of the outstanding Series B Preferred Stock iswas either converted or redeemed in full, upon which a final warrant ~~will be~~was issued.

~~Shares~~Pursuant to its Certificate of Designation and the Exchange Agreement, as applicable, the Series B Preferred Stock ishad the following features:
● The Series B Preferred Stock was convertible at any time at the option of the holder thereof into shares of Common Stock at an initial conversion price of $3.00 per share, subject to adjustment as set forth in the Certificate of Designation;
● The Series B Preferred Stock was subject to mandatory redemption in full at a redemption price initially equal to $10.00 per share, within 15 business days after the date on which the Company completed an equity financing resulting in total proceeds of at least $10 million. At any time after January 12, 2022, provided that the Company had paid in full all obligations outstanding under the Term Loan Agreement, the holders of a majority of the outstanding shares of Series B Preferred Stock were entitled to require the Company to redeem the Series B Preferred Stock at the then applicable redemption price, and any such redemption of Series B Preferred Stock would be prior and superior to the redemption of any and all other equity securities of the Company duly tendered for redemption; and
● If, at any time while the Series B Preferred Stock is outstanding, the Company completed any single public offering or private placement of its equity, equity-linked or debt securities (each, a “Future Transaction”), the Holder could, in its sole discretion, elect to apply all, or any portion, of the then outstanding Preferred Stock and any accrued but unpaid dividends, as purchase consideration for such Future Transaction. The conversion price applicable to such conversion would equal seventy percent (70%) of the cash purchase price paid per share, unit or other security denomination for the securities of the Company issued to other investors in the Future Transaction.
On January 22, 2022, 110,325 of Series B preferred stock was converted to 3,152,143 of common stock at $0.35 per share. On March 22, 2022, 110,525 of Series B preferred stock was converted to 3,157,857 of common stock at $0.35 per share. The remaining outstanding Series B preferred stock, 9,525 shares, was redeemed and a final warrant was issued to the Holder for 128,125 common shares at an exercise price of $~~3.00~~0.50 per ~~share, subject to adjustment as set forth in the Certificate of Designation.~~share.
Common Stock

~~The Series B Preferred Stock is subject to mandatory redemption in full at a redemption price initially equal to $10.00~~ ~~per share, within 15 business days after~~During the ~~date on which~~three months ended March 31, 2022, the ~~Company has completed an equity financing resulting in total proceeds of at least $~~10 million. At any time after January 12, 2022, provided that the Company has paid in full all obligations outstanding under the Term Loan Agreement, the holders of a majority of the outstanding shares of Series B Preferred Stock shall be entitled to require the Company to redeem the Preferred Stock at the then applicable redemption price, and any such redemption of Series B Preferred Stock shall be prior and superior to the redemption of any and all other equity securities of the Company duly tendered for redemption.Company:
● issued 27,400,000 shares of common stock through an equity capital raise at $0.50per share;
● issued 3,152,143 shares of common stock at $0.35per share to redeem 110,325 shares of Series B Preferred Stock;
● issued 3,157,857 shares of common stock at $0.35per share to redeem 110,525 shares of Series B Preferred Stock;

1214

EVmo, Inc.
Notes to ~~Condensed~~ Consolidated Financial Statements
For ~~the Nine months~~Year Three Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ (unaudited)
If, at any time while the Series B Preferred Stock is outstanding, the Company completes any single public offering or private placement of its equity, equity-linked or debt securities (each, a “Future Transaction”), the holders of the Series B Preferred Stock may, in their sole discretion, elect to apply all, or any portion, of the then outstanding Preferred Stock and any accrued but unpaid dividends, as purchase consideration for such Future Transaction. The conversion price applicable to such conversion shall equal seventy percent (70%) of the cash purchase price paid per share, unit or other security denomination for the securities of the Company issued to other investors in the Future Transaction.
~~Common Stock~~
~~During the nine months ended September 30, 2021, the Company:~~
● ~~issued~~ ~~100,0000~~ ~~shares of Common Stock to a member of the Company’s Board of Directors, in a negotiated transaction for $0.50~~ ~~per share, or aggregate cash consideration of $50,000~~;
● ~~issued~~ ~~295,000~~ ~~shares of Common Stock for the exercise of~~ ~~321,875~~ ~~stock options for cash consideration of $92,878~~;
● ~~issued~~ ~~1,273,050~~ ~~shares of Common Stock for the cashless exercise of~~ ~~1,348,525~~ ~~stock options;~~
● ~~issued~~ ~~600~~ ~~shares of Common Stock to an investor in connection with a prior note payable agreement;~~
● ~~issued~~ ~~1,000,000~~ ~~shares of Common Stock in connection with the conversion of a convertible note payable for $500,000~~;
● ~~issued an aggregate of~~ ~~256,250~~ ~~shares of Common Stock in connection with legal settlements. The shares were valued at $1,145,768~~ ~~which was based on the market price of the Common Stock on the grant date; and~~
● ~~issued~~ ~~825,000~~ shares to Acuitas Group Holdings, LLC, (“Acuitas”) which is now the Company’s largest shareholder, in connection with a settlement agreement between Acuitas and X, LLC, a company owned by the Company’s former chief executive officer. The board of directors deemed it was in the best interest of the Company to issue the shares to Acuitas. The value of the shares was $~~3,240,600~~ ~~which is based on the market price of the Company’s Common Stock at the grant date. The $3,240,600~~ ~~was expensed as financing costs as the dispute underlying the settlement agreement related to an anti-dilution of a prior investment in the Company by Acuitas.~~

Stock Options

The following is a summary of stock option activity:
Summary of Stock Option Activity
Weighted Options Outstanding Weighted Average Exercise Price Weighted Average Remaining Contractual Life Aggregate Intrinsic Value
Weighted Average
Average Remaining Aggregate
Options Exercise Contractual Intrinsic
Outstanding Price Life Value
Outstanding, December 31, 2020 2,540,000 $ 0.22 4.52 $ 1,074,245
Outstanding, December 31, 2021 766,750 $ .53 3.76 $ 98,937
Granted 290,000 0.84 40,000 .47 4.89
Forfeited (401,475 ) 0.22 - -
Exercised (1,670,400 ) 0.230 -
Outstanding, September 30, 2021 758,125 $ 0.42 3.93 $ 514,928
Exercisable, September 30, 2021 413,875 $ 0.56 3.99 $ 262,473
Outstanding, March 31, 2022 806,750 $ 0.44 3.71 $ 162,791
Exercisable, March 31, 2022 619,750 $ 0.50 3.86 $ 98,937

The exercise price for options outstanding and exercisable at ~~September 30, 2021:~~March 31, 2022:
Schedule of Options Outstanding by Exercise Price Range
Outstanding Exercisable
Number of Exercise Number of Exercise
Options Price Options Price
20,000 $ 0.210 20,000 $ 0.210
528,125 0.215 252,625 0.215
15,000 0.220 2,500 0.220
155,000 0.530 98,750 0.530
20,000 2.120 20,000 2.120
20,000 3.800 20,000 3.800
758,125 413,875
Number of Options, Outstanding Exercise Price, Outstanding Number of Options, Exercisable Exercise Price, Exercisable
Outstanding Exercisable
Number of Exercise Number of Exercise
Options Price Options Price
20,000 $ 0.210 20,000 $ 0.210
516,750 0.215 372,250 0.215
15,000 0.220 10,000 0.220
155,000 0.530 117,500 0.530
20,000 0.940 20,000 0.940
20,000 2.120 20,000 2.120
20,000 3.800 20,000 3.800
20,000 0.390 20,000 0.390
20,000 0.550 20,000 0.550
806,750 619,750
For options granted during the three months ended March 31, 2022 where the exercise price equaled the stock price at the date of the grant, the weighted-average fair value of such options was $0.47 and the weighted-average exercise price of such options was $0.47. No options were granted during the three months ended March 31, 2022 where the exercise price was less than the stock price at the date of grant or the exercise price was greater than the stock price at the date of grant.

1315

EVmo, Inc.
Notes to ~~Condensed~~ Consolidated Financial Statements
For Year Three Months Ended March 31, 2022 and 2021 (unaudited)
The fair value of the ~~Nine~~stock options is being amortized to stock option expense over the vesting period. The Company recorded stock option expense of $26,116 and $193,587 during the three months ~~Ended September 30,~~ended March 31, 2022 and 2021, ~~and 2020 (unaudited)~~respectively. At March 31, 2022, the unamortized stock option expense was $50,610.

Warrants

The following is a summary of warrant activity:
Summary of Warrant Activity
Weighted Warrants Outstanding Weighted Average Exercise Price Weighted Average Remaining Contractual Life Aggregate Intrinsic Value
Weighted Average
Average Remaining Aggregate
Warrants Exercise Contractual Intrinsic
Outstanding Price Life Value
Outstanding, December 31, 2020 1,631,250 $ 4.08 2.38 $ -
Outstanding, December 31, 2021 3,918,750 $ 2.87 3.17 $ -
Granted 1,106,250 2.64 664,092
Forfeited - -
Exercised - -
Outstanding, September 30, 2021 2,737,500 $ 3.50 2.89 $ -
Exercisable, September 30, 2021 2,737,500 $ 3.50 2.89 $ -
Outstanding, March 31, 2022 4,582,842 $ 2.47 3.48 $ -
Exercisable, March 31, 2022 4,582,842 $ 2.47 3.48 $ -

The exercise price for warrants outstanding at ~~September 30, 2021:~~March 31, 2022:
Schedule of Warrants Outstanding by Exercise Price Range
Outstanding and Exercisable
Number of Exercise
Warrants Price
450,000 $ 2.10
656,250 3.00
1,500,000 4.00
131,250 5.00
2,737,500
Outstanding and Exercisable
Number of Exercise
Warrants Price
1,174,311 $ 0.71
711,656 1.33
937,500 3.00
1,500,000 4.00
131,250 5.00
128,125 .50
4,582,842
16

~~In connection with a convertible note discussed in Note 6, the Company has issued an aggregate of~~ ~~468,750~~ ~~warrants. The fair value of the warrants was determined to be $961,106~~, using a Black-Scholes model, and has been recorded as financing costs in the accompanying statements of operations for the nine months ended September 30, 2021. The Company used the following assumptions in determining the fair value:EVmo, Inc.
~~Schedule of Stock Options Value Assumptions~~Notes to Consolidated Financial Statements
~~Risk-free interest rate~~ ~~0.76~~ – ~~0.87~~ %
~~Expected life of the options~~ 5 ~~years~~
~~Expected volatility~~ ~~180~~%-~~190~~ %
~~Expected dividend yield~~ 0 %
For Year Three Months Ended March 31, 2022 and 2021 (unaudited)
Note 10 – Related Party Transactions

During the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ the Company expensed $~~2,356,924~~530,987 and $~~1,715,237~~897,281, respectively, in insurance expense related to insuring the Company fleet of vehicles from an insurance brokerage firm whose owner is also a stockholder of the Company. ~~At September 30, 2021 and December 31, 2020, $670,047~~ ~~and $265,257, respectively, was owed to this insurance brokerage from and is included in accounts payable in the accompanying consolidated balance sheets.~~

~~The Company’s Executive Chairman and former CEO have made advances the Company. During the nine months ended September 30, 2021, the Company’s Executive Chairman loaned the Company $503,767~~ ~~and was repaid $503,767. The Company’s former CEO loaned the Company $100,000~~ ~~in 2020, and, during the nine months ended September 30, 2021 was repaid $100,000. At September 30, 2021, the Company owed its Executive Chairman and former CEO $~~0 ~~and $~~0~~, respectively.~~
14
~~EVmo, Inc.~~
~~Notes to Condensed Consolidated Financial Statements~~
~~For the Nine months Ended September 30, 2021 and 2020 (unaudited)~~
Note 11 – Contingencies

Legal Proceedings

From time to time, the Company may become involved in lawsuits and other legal proceedings that arise in the course of business. Litigation is subject to inherent uncertainties, and it is not possible to predict the outcome of litigation with total confidence. The Company is currently not aware of any legal proceedings or potential claims against it whose outcome would be likely, individually or in the aggregate, to have a material adverse effect on the Company’s business, financial condition, operating results, or cash flows, other than those described below.

Anthony Davis v. YayYo, Inc., and Ramy El-Batrawi

A complaint was filed on March 5, 2020, in the Los Angeles Superior Court by plaintiff Anthony Davis, who was hired by the Company as its CEO and as a director on or about December 2016. Mr. Davis’s employment with the Company ended after several months. As part of his compensation, Mr. Davis alleges that he expected to receive stock options in the Company. In his pleadings, Mr. Davis admits that he resigned from his executive officer and director positions, but asserts that he did not receive certain compensation in the form of stock options (he has also included a claim for wage and hour violations). The Company denies liability and has asserted that it has paid Mr. Davis all amounts due to him under his employment agreement, while also asserting that Mr. Davis failed to exercise his stock options before they expired on December 31, 2018. The Company filed a demurrer to the first amended complaint, which the Superior Court granted in part and denied in part on September 8, 2021. The Plaintiff since filed a second amended complaint, to which the Company has filed an answer. The Company’s position is that the lawsuit entirely lacks merit, and the Company intends to defend it vigorously.

Ivan Rung v. YayYo, Inc., Ramy El-Batrawi, et al., 20STCV27876 and Michael Vanbecelaere v. YayYo, Inc., Ramy El-Batrawi, et al., 20STCV28066 (Vanbecelaere)(hereafter the “State Cases”)

On July 22 and July 23, 2020, respectively, two actions were filed in the Los Angeles Superior Court. The complaints underlying the State Cases differ only by a few words and some random punctuation marks, and are therefore virtually identical. Plaintiffs Ivan Rung and Michael Vanbecelaere each claimed to have purchased the Common Stock as part of the Company’s initial public offering (the “IPO”); they purport to bring a securities class action on behalf of all purchasers of the Common Stock pursuant to the registration statement and prospectus filed with the SEC and distributed in connection with the Company’s IPO, which was launched on November 14, 2019. The State Case complaints allege misrepresentations and material omissions in the SEC filings in violation of Sections 11 and 15 of the Securities Act of 1933, as amended (the “Securities Act”). The Company has and continues to vigorously deny any and all liability and asserts that the State Cases are baseless. It is the Company’s firm position that it accurately and completely disclosed all material facts and circumstances in its SEC filings relating to the IPO, and subsequently in its periodic SEC reports, including those that were potentially adverse to the Company’s operations and business prospects. The State Cases litigation is presently stayed pending the outcome of the federal securities case discussed below (Hamlin v. YayYo, Inc.), as to which, as noted below, the parties have announced a “settlement in ~~principle”,~~principle,” which is subject to court approval in the district court. The Company anticipates filing motions to dismiss the purported class actions in Superior Court on the basis of the anticipated approval of the federal settlement.

Jason Hamlin v. YayYo, Inc., Ramy El-Batrawi, et al., 20-cv-8235 (SVW) and William Koch v. YayYo, Inc., Ramy El-Batrawi, et al., 20-cv-8591 (SVW)(now consolidated as “In re YayYo Securities Litigation”)

These two actions were filed on September 9, 2020 and September 18, 2020, respectively, in the United States District Court for the Central District of California. Plaintiffs Jason Hamlin and William Koch each claim to have purchased the Common Stock as part of the IPO and, like the plaintiffs in the State Cases, purport to bring a securities class action pursuant to Sections 11 and 15 of the Securities Act, as well as and Section 17(a) and 10(b)(5) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) on behalf of all purchasers of the Common Stock in the IPO. The first amended complaint, like the State Cases, alleges false statements and material omissions of material fact in connection with the SEC filings distributed in connection with the IPO. The defendants include directors of the Company and the underwriters of the IPO, WestPark Capital, Inc. (“WestPark”) and Aegis Capital Corp. The federal court ~~has~~ consolidated the two matters for all practical purposes. As with the State Cases, the Company ~~denies~~denied liability and ~~asserts~~asserted that it accurately and completely disclosed all material facts and circumstances in its SEC filings, and that the complaint’s alleged violations of securities laws are baseless. ~~Please see Note 13- Subsequent Events~~The parties to the federal court litigation announced on October 21, 2021 that they had reached a settlement, which received preliminary approval by the district court on January 13, 2022, allowing the notice of the proposed settlement to be distributed to all class members, who unless they object or drop out, will be bound by the multi-million dollar settlement. The Company’s portion of the settlement was $1 million paid out in equal installments every three months over the course of 2022. These payments have been and will continue to be timely made. Executive Chairman Terren Peizer provided his personal guarantee for the whole amount due to the plaintiffs. The district court has set a ~~description~~hearing for final approval of ~~a provisional~~the settlement for June 6, 2022 in an order that stated: “the Court grants preliminary approval of ~~this litigation.~~the settlement and of the notification procedures as detailed in the parties’ proposed order, ECF No. 168-2,” with the court setting dates for persons to file objections or comments to the settlement prior the hearing which was “set for June 6, 2022 at 1 :30p.m.”
17
EVmo, Inc.
Notes to Consolidated Financial Statements
For Year Three Months Ended March 31, 2022 and 2021 (unaudited)

Konop v. El-Batrawi, et al., 1:20-cv-1379- MN (Filed in Del. District Court)
15
~~EVmo, Inc.~~
~~Notes to Condensed Consolidated Financial Statements~~
~~For the Nine months Ended September 30, 2021 and 2020 (unaudited)~~

On October 12, 2020 a complaint was filed in Delaware District Court, which has since been transferred to the U.S. District Court for the Central District of California, and assigned as a related case to the judge in the pending federal securities action described immediately above. This case is a purported shareholder derivative action, in which the Company is a nominal defendant, alleging that the Company’s executive officers and directors at the time of its IPO made false and misleading statements relating to the Company’s business, operations, and future prospects and that the directors breached their fiduciary duties in doing so. The Company believes that the allegations of the complaint are spurious and will vigorously defend the case at trial.

~~Note 12 –~~ ~~Settlements~~Bellridge Capital, LP, v. EVmo, Inc., 1:21-cv-07091-PGG (Filed in Southern District of New York)

~~FirstFire Settlement~~In the first half of 2021 a warrant holder, Bellridge Capital, LP, sought to exercise a warrant for 1,500,000
shares for a nominal amount, claiming that an anti-dilution adjustment had been triggered in 2020, which had reduced the exercise price to such amount. The Company rejected the exercise, on the basis that the warrant had previously been amended to remove the anti-dilution adjustment provisions and fix the exercise price at $4.00
~~On February 11,~~. In September 2021, the Company, entered into a settlement agreement and mutual release (the “Settlement Agreement”) with FirstFire Global Opportunities Fund, LLC, a Delaware limited liability company (“FirstFire”), relating to a pending action in the U.S. District Courtwarrant holder brought suit for damages in the Southern District of New ~~York,~~ ~~FirstFire Global Opportunities Fund, LLC v. WestPark Capital, Inc. et. al.~~~~, No. 1:20-cv-03327-LLS. The other parties to the Settlement Agreement are~~York. It is the Company’s ~~co-defendants~~position that the lawsuit is without merit. This lawsuit is currently in the ~~litigation, WestPark, Mr. Richard A. Rappaport and Mr. Ramy El-Batrawi, former chief executive officer of the Company.~~discovery phase.

~~This litigation was commenced by FirstFire in April 2020~~Note 12 – Settlements
Settlement of In re YayYo Securities Litigation and ~~subsequently amended in December 2020. FirstFire was~~the State Cases
Please see a ~~subscriber to~~description of the ~~Company’s initial public offering of Common Stock, in November 2019 (the “IPO”). It alleged in the lLitigation that~~preliminary collective settlement the Company ~~and the other named defendants had,~~has reached in connection with both the ~~IPO~~In re YayYo Securities Litigation and the registration statement on Form S-1 filed thereto, committed violations of Sections 11, 12(a) and 15 of the Securities Act of 1933, as amended (the “Securities Act”), Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Rule 10b-5 promulgated under the Exchange Act. Each of the Company, WestPark, Mr. Rappaport and Mr. El-Batrawi vigorously denied and disputed these allegations.
~~In consideration of the releases, covenants, terms and conditions set forth~~State Cases in the Settlement Agreement, FirstFire agreed to dismiss the litigation with prejudice, to not file any further litigation relating to the IPO, and to waive and relinquish any and all claims on shares of Common Stock other than as specified in the Settlement Agreement.“Note 11- Contingencies” above. The Company ~~agreed~~expects that the district court will grant final approval to ~~sell to FirstFire one hundred fifty thousand (150,000~~) shares of Common Stock (the “Settlement Shares”), with such shares issued pursuant to the exemption from registration under Rule 506(b) of the Act. The purchase price of the Settlement Shares was $~~0.066667~~ ~~per share, or an aggregate of $10,000~~. Any resale of the Settlement Shares by FirstFire shall be subject to the conditions of Rule 144 of the Act. None of WestPark, Mr. Rappaport or Mr. El-Batrawi contributed to the Settlement Shares or any other consideration under the Settlement Agreement.
~~Social Reality Settlement~~
~~On February 19, 2021, the Company entered into a confidential~~this omnibus settlement agreement and mutual release with SRAX, Inc., a Delaware corporation formerly known as Social Reality, Inc. (“SRAX”), relating to an action brought by SRAX against the Company in Los Angeles Superior Court on or around ~~February 11, 2020. A description~~June 6, 2022, and, in anticipation of ~~this litigation~~such approval, has been ~~included by~~making settlement payments to the ~~Company in its prior filings.~~plaintiffs during the first quarter of 2022.
~~The Company and SRAX mutually agreed to keep the material terms of this settlement confidential, subject to disclosure as required by applicable law or regulation.~~

Note 13 – Subsequent Events
~~The Company has evaluated~~There are no material subsequent events ~~through November 12, 2021. The Company has determined there were no subsequent events that require recognition or disclosure in the financial statements, except as discussed below:~~to report.
● ~~The Company issued an aggregate of~~ ~~187,500~~ ~~warrants pursuant to the terms of the convertible note agreement discussed in Note 6.~~
● The parties to the In re YayYo Securities Litigation described in Note 11 above have, after extensive negotiations, recently filed a “Notice of Pending Settlement” with the court, which is subject to approval by the district court and which, if approved, will resolve the pending class actions upon payment by the Company of approximately $~~1,000,000~~ ~~to the class. The Company’s Executive Chairman has provided his personal guarantee for the whole amount due to the plaintiffs, and the Board of Directors has agreed to issue~~ ~~2,000,000~~ ~~shares of Common Stock as consideration for the guarantee. The motion for approval of the settlement is scheduled to be heard by the court on or around November 19, 2021.~~

1618

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Cautionary Note Regarding Forward-Looking Statements
Certain statements made herein, as well as in other filings we make with the SEC and other written and oral information we release, regarding our future performance constitute “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “may,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue” and similar references to future periods. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. Our plans and objectives are based, in part, on assumptions involving the continued expansion of business, which assumptions involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe our assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate, and, therefore, there can be no assurance the forward-looking statements included herein will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that our objectives and plans will be achieved. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those described ~~in Part II, Item 1A, “Risk Factors” and~~ elsewhere in this report and as also may be described from time to time in future reports we file with the SEC. You should read such information in conjunction with our consolidated financial statements and related notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this report. There also may be other factors that we cannot anticipate or that are not described in this report, generally because we do not currently perceive them to be material. Such factors could cause results to differ materially from our expectations.

Forward-looking statements speak only as of the date they are made, and we do not undertake to update these statements other than as required by law. You are advised, however, to review any further disclosures we make on related subjects in our periodic filings with the SEC.
Our Corporate History and Background

~~The Company~~EVmo was initially formed on June 21, 2016 as a Delaware limited liability company under the name “YayYo, ~~LLC,~~LLC.” ~~which~~The Company was subsequently converted into a Delaware corporation pursuant to Section 265 of the ~~unanimous written consent of our former manager and members in a transaction intended to be tax-free under the Internal Revenue Code~~Delaware General Corporation Law (the ~~“Conversion”~~“DGCL”). The Company now operates as a “C” corporation formed under the laws of the State of Delaware. ~~On September 11, 2020, YayYo, Inc. changed its name to Rideshare Rental, Inc. On March 1, 2021, the Company changed its name from Rideshare Rental, Inc. to EVmo, Inc.~~

~~The Company is~~We became a ~~holding~~reporting company ~~operating through its wholly-owned subsidiaries, Distinct Cars, LLC and Rideshare Car Rentals, LLC.~~
The Company’s operating business divisions include (i) an online rideshare vehicle booking platform to service the ridesharing economy through Rideshare Car Rentals, i.e., the Rideshare Platform, and (ii) the maintenance of a fleet of standard passenger vehicles to be made commercially available for rent through Distinct Cars. The Company seeks to become the leading provider of standard rental vehicles to drivers in the ridesharing economy.
Onwhen, on March ~~16, 2018, we completed~~17, 2017, an offering ~~under Regulation~~circular on Form 1-A relating to a best-efforts offering of our common stock pursuant to “Regulation A+” of the Securities Act ~~which~~of 1933, as amended (the “Securities Act”), was qualified by the ~~SEC~~Securities and Exchange Commission (the “SEC”). Then, on March 15, 2017. We sold a total of 365,306 shares of Common Stock. We received cash proceeds of $1.8 million, net of commissions and other costs associated with the gross offering proceeds or payable by us.
On November 15, 2019, ~~the Company closed its~~we completed an initial public offering of 2,625,000 ~~common~~ shares of Common Stock, at $4.00 per share, for gross proceeds, before underwriting discounts and commissions and expenses, of $10.5 million and ~~the shares became~~our common stock was listed on the Nasdaq Capital Market (“Nasdaq”) under the ticker symbol “YAYO.”
17

On February 10, 2020, after being advised by Nasdaq that it believed we no longer met the conditions for continued listing, the Company ~~notified Nasdaq of~~announced its intent to voluntarily delist its Common Stock from Nasdaq. In connection therewith, the Company notified Nasdaq of the Company’s intention to file a Form 25 with the SEC on or about February 20, 2020. The Company elected to effect the voluntary delisting of its Common Stock after discussions with Nasdaq’s staff and based on the determination of the Company’s Board of Directors that voluntarily delisting the Common Stock from Nasdaq was in the best interests of the Company and its stockholders. Followingcommon stock. Since delisting from Nasdaq, ~~the Common Stock now trades~~our common stock has been quoted and traded on the Pink Open Market, ~~still~~which is operated by OTC Markets Group, under the ~~trading symbol, “YAYO.”~~same ticker symbol. The delisting was effective on March 1, 2020.
In September 2020, we changed our name from YayYo, Inc. to Rideshare Rental, Inc., in order for our corporate brand to better reflect our principal businesses, ridesharing and vehicle rentals. In February 2021, we again changed our name to EVmo, Inc., to underscore our commitment to making a full transition to electric vehicles by the end of 2024.
We are a holding company operating principally through two wholly-owned subsidiaries: Rideshare Car Rentals, LLC and Distinct Cars, LLC. Our proprietary Rideshare Platform provides TNC drivers with an online booking platform, while Distinct Cars maintains a fleet of passenger vehicles and transit vans for use in the last-mile logistical space for rent to our TNC driver customers, enabling such drivers to meet the vehicle suitability and other requirements of rideshare and delivery gig companies such as Uber, Lyft, DoorDash and Grubhub. Through Rideshare and Distinct Cars, we seek to become a leading provider of rental vehicles to drivers in the ridesharing and delivery gig spaces, and an industry leader in supplying transit vans for last-mile logistics.
Impact of COVID-19 on our business

On January 30, 2020, the World Health Organization declared the outbreak of the coronavirus disease (COVID-19) a “Public Health Emergency of International Concern,” and on March 11, 2020, ~~the World Health Organization~~it characterized the outbreak as a “pandemic.” In response, numerous states and cities ordered their residents to cease traveling to non-essential jobs and to curtail all unnecessary travel, and similar restrictions were recommended by the federal government. Beginning in the first quarter of 2020, which saw the initial rapid spread of COVID-19, rideshare companies were severely and negatively impacted, as demand plummeted. Consequently, the Company experienced a decline in revenue during the first half of 2020, which had a negative impact on ~~its~~our cash flows, but itwe then saw a positive upward movement in revenue during the second half of 2020, which ~~has~~ continued ~~into~~through fiscal 2021. This was consistent with the ~~first half~~experience of the TNCs whose drivers we service. According to Bloomberg Second Measure, Uber and Lyft sales were up 104% and 84% year-over-year, respectively, in February 2022 from one year earlier, even in spite of the Delta and Omicron variants that resulted in spikes of infections through periods of 2021. ~~In early 2021, several vaccinations for~~
Given the current prevalence of FDA-approved eligible vaccines across most age groups, the marked decrease in the number of COVID-19 received emergency-use authorization from the Food and Drug Administration, and many of the lockdown restrictions imposed by state and local governments, including those of the markets in which the Company operates, appear to be abating. The pandemic has not yet ended, however, and there have been multiple waves where infections, hospitalizations and deaths ~~have sharply increased. The Company therefore cannot predict~~in the ~~ultimate impact~~first quarter of 2022, and the resulting easement of pandemic restrictions in our active markets, we are optimistic that COVID-19 ~~may~~will not have a material impact on ~~its business this year,~~our operations in the current fiscal year. However, certain factors- including, for example, a new, more aggressive and ~~possibly beyond.~~deadly variant that is resistant to the vaccines- could reverse the positive trends of recent months and alter our prediction.
Principles of consolidation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Distinct Cars, LLC and RideShare Car Rentals, LLC. All significant intercompany transactions and balances have been eliminated.

Consolidated Results of Operations—Three Months Ended ~~September 30, 2021,~~March 31, 2022, Compared to Three Months Ended ~~September 30, 2020~~March 31, 2021

Total Revenues.

Revenue for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$2,724,180,~~$2,459,709, an increase of ~~$653,359~~$165,177 or ~~31.6%~~6.7% compared to revenue for the three months ended ~~September 30, 2020~~March 31, 2021 of ~~$2,070,821.~~$2,294,532. The increase is principally due to an increase in our rental ~~fleet. During the three months ended September 30, 2021, the average weekly~~fleet and increase in our daily rental income per vehicle placed in service was $416 compared to $339 for the same period in 2020. Our revenues declined in March and April of 2020 due to COVID -19 and began to recover in May and June 2020. Our revenue since June 2020 is back to pre-COVID-19 levels, but there is no assurance that this trend will continue.rate.

Cost of Revenues.

The principal components of costs of revenue are depreciation of the vehicles, vehicle insurance and maintenance.

Cost of revenues for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$2,285,878,~~$1,972,063, an increase of ~~$1,090,921~~$191,160 or ~~91.3%~~9.6% compared to cost of revenues for the three months ended ~~September 30, 2020~~March 31, 2021 of ~~$1,194,957.~~$1,780,903. The increase is due to higher depreciation expense, ~~and~~ insurance expense and vehicle repairs due to an increase in fleet ~~size and higher maintenance costs.~~size. For the three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ our cost of revenue was ~~83.9%~~80.1% and ~~57.7%~~77.6% of our revenue, ~~respectively.~~respectively including vehicle depreciation. The increase in the cost of revenue as a percentage of revenue is due to ~~higher maintenance~~increase insurance and ~~insurance~~body shop costs.
Selling and Marketing Expenses.

Selling and marketing expenses for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$26,565,~~$64,336, representing a decrease of ~~$87,339~~$101,412 or ~~76.7%~~61.2% over the three months ended ~~September 30, 2020~~March 31, 2021, of ~~$113,904.~~$165,748. The decrease is due to ~~a decrease in~~an effective focused advertising ~~to gig-economy drivers as we have maintained a~~campaign and high ~~utilization rate~~demand for vehicle reducing our ~~vehicles.~~cost of client acquisition.
General and Administrative Expenses.

General and administrative expenses for the three months ended ~~September 30, 2021~~March 31, 2022, were ~~$3,218,912,~~$1,462,325, representing an increase of ~~$2,130,760~~$23,557 or ~~195.8%~~1.6% over the three months ended ~~September 30, 2020~~March 31, 2021 of ~~$1,088,152. The increase is principally due to higher professional fees, salaries, and litigation settlement during the three months ended September 30, 2021.~~$1,439,101.

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Total Operating Expenses
Total operating expenses for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$3,291,977,~~$1,545,661, representing ~~an increase~~a decrease of ~~$2,089,921~~$68,688 or ~~173.9%~~4.4% compared to the three months ended ~~September 30, 2020~~March 31, 2021 of ~~$1,202,056.~~$1,614,349. The ~~increase~~decrease is due to the ~~reasons described above.~~reduction in professional fees.
Interest expense and financing cost

Interest and financing expenses for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$2,007,194~~$452,032 compared to ~~$65,292~~$3,324,943 for the three months ended ~~September 30, 2020.~~Mach 31, 2021. The ~~increase in~~ interest expense was for redemption and conversion of the Preferred Series B Stock, Energy Impact Partners note interest expense and vehicle lease financing ~~cost for the three months ended September 30,~~interest expense. The decrease from March 31, 2021 was due ~~to full amortization of debt discounts due to~~ the ~~$2.250 million convertible note being converted to preferred stock and issuance of additional warrants associated with the $2.250 million convertible note.~~
~~Net Loss~~
The net loss for the three months ended September 30, 2021 was $4,777,328, representing an increase of $4,385,844 or 1,120.3% compared to the three months ended September 30, 2020 of $391,484. The increase is due to the reasons described above.
~~Consolidated Results of Operations~~—~~Nine Months Ended September 30, 2021, Compared to Nine Months Ended September 30, 2020~~
~~Total Revenues~~.
Revenue for the nine months ended September 30, 2021 was $7,670,795, an increase of $2,271,777 or 42.1% compared to revenue for the nine months ended September 30, 2020 of $5,399,018. The increase is principally due to an increase in our rental fleet. During the nine months ended September 30, 2021, the average weekly rental income per vehicle placed in service was $411 compared to $298 for the same period in 2020. Our revenues declined in March and April of 2020 due to COVID -19 and began to recover in May and June 2020. Our revenue since June 2020 is back to pre-COVID-19 levels, but there is no assurance that this trend will continue.
~~Cost of Revenues~~.
~~The principal components of costs of revenue are depreciation of the vehicles, vehicle insurance and maintenance.~~
Cost of revenues for the nine months ended September 30, 2021 were $5,982,075, an increase of $2,098,768 or 53.7% compared to cost of revenues for the nine months ended September 30, 2020 of $3,891,307. The increase is due to higher depreciation expense and insurance expense due to an increase in fleet size and higher maintenance costs. For the nine months ended September 30, 2021 and 2020 our cost of revenue was 78.0% and 72.1% of our revenue, respectively. The increase in the cost of revenue as a percentage of revenue is due to higher maintenance and insurance costs.
~~Selling and Marketing Expenses~~.
Selling and marketing expenses for the nine months ended September 30, 2021 were $257,129, representing a decrease of $67,417 or 20.8% over the nine months ended September 30, 2020 of $324,546. The decrease is due to a decrease in advertising to gig-economy drivers as we have maintained a high utilization rate for our vehicles.
~~General and Administrative Expenses~~.
General and administrative expenses for the nine months ended September 30, 2021 were $6,151,507, representing an increase of $2,305,739 or 60.0% over the nine months ended September 30, 2020 of $3,845,768. The increase is principally due to higher professional fees, salaries, and litigation settlement during the nine months ended September 30, 2021.
~~Total Operating Expenses~~
Total operating expenses for the nine months ended September 30, 2021 were $6,515,402, representing an increase of $2,345,088 or 56.2% compared to the nine months ended September 30, 2020 of $4,170,314. The increase is due to the reasons described above.
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~~Interest expense and financing cost~~
Interest and financing expenses for the nine months ended September 30, 2021 were $6,296,524 compared to $212,943 for the nine months ended September 30, 2020. The increase in interest and financing cost for the nine months ended September 30, 2021 was due tonon-recurring the issuance of 825,000 shares of ~~Common Stock~~common stock to Acuitas Group Holdings, LLC, (“Acuitas”), which is now the Company’s largest shareholder, in connection with a settlement agreement between Acuitas and X, LLC, a company owned by the Company’s former chief executive officer. The ~~Board~~board of ~~Directors~~directors deemed it was in the best interest of the Company to issue the shares to Acuitas. The value of the shares was $3,240,600 which ~~was~~is based on the market price of the ~~Common Stock~~Company’s common stock at the grant date. The $3,240,600 was expensed as financing costs as the dispute underlying the settlement agreement related to an anti-dilution of a prior investment in the Company by Acuitas. Also, the increase in interest and financing expenses for the nine months ended September 30, 2021 was due to full amortization of debt discounts due to the $2.25 million convertible note being converted to shares of Series B Preferred Stock and issuance of additional warrants associated with the $2.25 million convertible note.

~~Gain on Forgiveness of Debt~~
Gain on forgiveness of debt for the nine months ended September 30, 2021 was $8,000 as compared to $0 for the same period in 2020, as, during the nine months ended September 30, 2021, the remaining amount we received under the Paycheck Protection Program of the Coronavirus Aid, Relief and Economic Security Act was forgiven.
Net Loss

The net loss for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 was ~~$11,031,665,~~$1,510,052, representing an increase of ~~$8,156,119~~$2,907,611 or ~~283.6%~~65.8% compared to net loss from the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 of ~~$2,875,546.~~$4,417,663. The increase is due to the reasons described above.
Liquidity, Capital Resources and Plan of Operations

On November 15, 2019, we closed our initial public offering of ~~Common Stock~~common stock registered on an S-1 Registration Statement under the Securities Act, which was declared effective on November 13, 2019. We sold a total of 2,625,000 common shares at a price of $4.00 per share. Total gross proceeds from the offering were $10,500,000, before deducting underwriting discounts and commissions and other offering expenses.

~~During the year ended December 31, 2020,~~On January 6, 2022, we ~~sold an aggregate~~closed a follow-on offering of ~~2,553,571~~27,400,000 shares of ~~Common Stock to three investors~~common stock for ~~cash~~$0.50 per share, for gross proceeds of ~~$275,000, of which 125,000 shares was sold to a member of our Board of Directors for cash consideration of $25,000.~~$13,700,000.

~~On January 8, 2021,~~Subsequently, we ~~received $500,000 from a convertible note from one of our stockholders. The note is convertible into~~issued 6,310,000 shares of ~~Common Stock at $0.50 per share. The note was converted into 1,000,000~~common stock for the conversion of 220,850 shares of ~~Common Stock in February 2021.~~Series B preferred stock. The remaining 9,525 outstanding shares of Series B preferred stock were redeemed by the Company

~~On April 12, 2021, we entered into a securities purchase agreement with a certain investor in connection with~~In addition, after the ~~issuance~~recent public offering and conversion of ~~a 12.5% original issue discount convertible promissory note and a common stock purchase warrant. The note has an original principal amount~~most of $2,250,000, with an original issue discount of $250,000. It bears interest at a fixed rate of 10%, and is convertible into shares of common stock at a price of $3.00 per share (subject to adjustment as set forth in the ~~note). The note was set to mature on January 12, 2022; however, in July 2021, the Company and the noteholder agreed to convert the note into 230,250 shares of~~ Series B ~~Preferred Stock.~~
~~On July 9, 2021 (the “Closing Date”), we entered into a Term Loan, Guarantee and Security Agreement (the “Term Loan Agreement”) with EICF Agent LLC (“EICF”), as agent for~~preferred stock, the ~~lenders, and~~two warrants issued to Energy Impact Credit Fund I, LP ~~as lender (the “Lender”), providing~~in 2021 for a secured term loan facility in an aggregate principal amount of up to $15.0 million (collectively, the “Term Loans”), consisting of a $7.5 million closing date term loan facility (the “Closing Date Term Loan”)450,000 shares and up to $7.5 million of borrowings under a delayed draw term loan facility (the “Delayed Draw Term Loan Facility”). The Closing Date Term Loan was fully drawn on the Closing Date, while the Delayed Draw Term Loan Facility is available upon the satisfaction of certain conditions precedent specified in the Term Loan Agreement. The Term Loan Agreement matures on July 9, 2026. Borrowings under the Term Loan Agreement bear interest at the London Interbank Offered Rate (“LIBOR”), plus a margin of 10.0%.
~~During the nine months ended September 30, 2021, we sold 100,000~~900,000 shares of ~~Common Stock~~common stock, respectively, were subject to ~~a member~~adjustment according to their terms. The warrant for 450,000 common shares has been adjusted to one for 711,656 common shares at an exercise price of ~~our Board~~$1.33 and the warrant for 900,000 common shares has been adjusted to one for 1,174,311 common shares at an exercise price of ~~Directors for cash consideration of $50,000.~~$0.71 per share.

Current Assets, Liabilities and Working Capital.

At ~~September 30,~~March 31, 2022, the Company’s current assets totaled $12,025,005, current liabilities totaled $4,555,595, and working capital was $7,469,410. At December 31, 2021, the Company’s current assets totaled ~~$4,847,770,~~$4,077,934, current liabilities totaled ~~$6,162,643,~~$7,051,073, and working capital was a deficit of ~~$1,314,873. At December 31, 2020, the Company’s current assets totaled $215,990, current liabilities totaled $4,461,560, and working capital was a deficit of $4,245,570.~~$2,973,139.

Regarding current liabilities, the amounts categorized as accounts payable and accrued expenses totaled ~~$3,947,534~~$2,509,077 and ~~$2,119,003~~$4,940,580 as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, respectively, ~~an increase~~a decrease of ~~$1,828,531~~$2,431,503 or ~~86.3%~~49.2%, due to ~~accrual~~common stock issued for legal ~~settlement of $1,000,000 and increase~~settlements that were previously included in ~~amounts due for professional services.~~accrued expenses.

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Since inception, our principal sources of operating funds have been proceeds from equity financing including the sale of our common stock to initial investors known to management and principal shareholders of the Company. We do ~~not~~ expect that our current cash on hand ~~will~~to fund ~~our existing~~ operations ~~and future business growth. We will need to raise additional capital in order execute our business plan and growth goals~~ for ~~at least~~ the next twelve months. If the Company is unable to raise sufficient funds, it will have to execute a slower than planned growth path, reduce overhead and scale back its business plan until sufficient additional capital is raised to support further operational expansion and growth.balance of 2022. As of ~~September 30, 2021,~~March 31, 2022, the Company had ~~$3,540,212~~$10,949,709 in cash. The Company ~~used $1,454,194 of~~generated $(2,992,530) in cash ~~for~~from operating activities for the ~~nine~~three months ended September 30, 2021. The Company is seeking to raise additional capital. If the Company is not successful in raising additional capital it will be forced to significantly scale back its business operations and it growth plans. We were able to obtain two loans totaling $342,675 related to new legislation passed as a result of COVID-19, of which $192,775 was forgiven in 2020 and 2021.March 31, 2022.

Capital Expenditures

During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, the Company had capital expenditures of ~~$5,692,784~~$1,303,487 in leased vehicles. At ~~September 30, 2021, most~~March 31, 2022, approximately 50% of the Company’s vehicles were financed with leases. At ~~September 30, 2021~~March 31, 2022 the Company had ~~$14,760,669~~$13,132,629 of rental vehicles, net of accumulated depreciation in the amount of ~~$4,394,296,~~$4,840,062, totaling ~~$10,366,373~~$8,292,597 in net rental vehicles. At December 31, ~~2020~~2021 the Company had ~~$9,067,885~~$13,514,619 of rental vehicles, net of accumulated depreciation in the amount of ~~$2,871,452,~~$4,627,299, totaling ~~$6,196,433~~$8,887,320 in net rental vehicles. The Company’s rental vehicles are depreciated over their estimated useful life of five years. The lease terms for those rental vehicles that are leased are generally for three years and the Company has the right to purchase the leased assets ~~for $1 each~~ at the end of the lease terms.
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Statement of Cash Flows

Cash Flows from Operating Activities
Net cash used in operating activities for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 totaled ~~$1,454,194,~~$(2,992,530), which was an ~~increase~~decrease of ~~$1,642,737~~$3,069,742 from the net cash provided by operating activities of ~~$188,543~~$77,212 for the same period in ~~2020.~~2021. The ~~change~~decrease is principally due to the ~~change~~reduction in ~~operating assets~~accounts payable following the equity capital raise in January 2022 and ~~liabilities, and non-cash expense items.~~
~~Cash Flows from Investing Activities~~
Net cash used in investing activities for the nine months ended September 30, 2021 totaled $47,051, which was an increase of $47,051 from $0 for the same period in 2020. The change is principally due to the purchase of property and equipment.accrued expenses.

Cash Flows from Financing Activities

Net cash provided by financing activities for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 totaled ~~$4,968,567,~~$12,088,311, which was an increase of ~~$6,328,807~~$12,035,886 from ~~the net cash used in financing activities of $1,360,240~~$52,425 for the same period in ~~2020.~~2021. The change is principally due to ~~cash received from~~ the ~~sale of Common Stock, exercise was stock options, convertible note and note payable in 2021 offset by an increase in payments~~equity capital raise completed on ~~financing lease obligations.~~January 6, 2022.
Current Plan of Operations

Our plan of operations is currently focused on the growth and ongoing development of our operating businesses: (i) the Rideshare Platform, offered through Rideshare, and (ii) ~~Fleet Management, made~~our vehicle fleet, which is commercially available through Distinct Cars. We expect to incur substantial expenditures in the foreseeable future for the ~~enhanced~~continuing operations of our ~~businesses and related, ongoing, internal research and development.~~businesses. Moreover, we have embarked on ~~“EV strategy”~~our EV strategy, in which we intend to replace our entire fleet of vehicles with all electric vehicles ~~within a relatively short period of time.~~by 2024. At this time, we cannot reliably estimate the ~~nature,~~ timing or aggregate amount of all of the costs associated with ~~these.~~these efforts.

~~The continuation~~Although, as we state above, we believe we have sufficient working capital to finance our operations in fiscal 2022 and to execute the 2022 phase of our ~~current~~EV strategy, it is possible that our expansion plan ~~of operations~~ may require us to raise significant additional capital within a short period of time. If we are successful in raising capital, we believe that the Company will have sufficient cash resources to fund its plan of operations. The cash flow from our Rideshare Platform and, especially, Fleet Management businesses and our existing capital resources are sufficient for us to continue our current operations, but for us to fully execute our business plan we will likely require significant additional capital.

We continually ~~evaluate~~reevaluate our plan of operations to determine ~~the manner in which~~how we can most effectively utilize our ~~limited cash~~ resources. The ~~timing of~~ completion of any aspect of our plan of operations is highly dependent upon the ready availability of cash to implement that aspect of the plan and other factors, several of which are beyond our control. There iscan be no assurance that our current capital resources will be adequate to continue to fund our ongoing operations, nor can there be any assurance that, should we require additional capital, we will successfully obtain ~~the required~~it on favorable terms, or at all. The potential inadequacy of our existing capital or ~~revenues, or, if obtained, that~~ the ~~amounts will be sufficient to fund our ongoing operations. The~~ inability to secure additional capital ~~would~~could have a material adverse effect on us, including the possibility that we would have to sell or forego a portion or all of our assets or cease operations. If we discontinue our operations, we ~~will~~may not have sufficient funds to pay any amounts to our stockholders.

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~~Even if we raise additional capital in the near future, if~~If our operating businesses fail to achieve anticipated financial results, our existing capital will likely be depleted more quickly than we anticipate and our ability to raise additional capital ~~thereafter~~in the future to fund our operations would likely be seriously impaired. If in the future we are not able to demonstrate favorable financial results or projections from our operating businesses, we ~~will likely~~may not be able to raise the capital we need to continue operations.
Similarly, because our ~~then~~working capital requirements depend upon numerous factors there can be no assurance that our current ~~business operations and business activities, and we will likely not have sufficient liquidity or~~ cash resources will be sufficient to ~~continue operating.~~fund our operations.
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Because our working capital requirements depend upon numerous factors there can be no assurance that our current cash resources will be sufficient to fund our operations. At present, we have no committed external sources of capital, and we do not expect any significant product revenues for the foreseeable future. Thus, we will require immediate additional financing to fund future operations. There can be no assurance, however, that we will be able to obtain funds on acceptable terms, if at all.

Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

Quantitative and Qualitative Disclosures about Market Risk

In the ordinary course of our business, we are not exposed to market risk of the sort that may arise from changes in interest rates or foreign currency exchange rates, or that may otherwise arise from transactions in derivatives.

Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States, or U.S. GAAP. Preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable. In many instances, we could have reasonably used different accounting estimates and in other instances changes in the accounting estimates are reasonably likely to occur from period to period. This applies in particular to useful lives of non-current assets and valuation allowance for deferred tax assets. Actual results could differ significantly from our estimates. To the extent that there are material differences between these estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected. We believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving our judgments and estimates.

Property and Equipment and Rental Vehicles

Property and Equipment and Rental Vehicles are stated at cost. Expenditures for maintenance and repairs are charged to earnings as incurred; additions, renewals and betterments are capitalized. When equipment is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gain or loss is included in operations. Depreciation of equipment and rental vehicles is provided using the straight-line method for substantially all assets with estimated lives as follows:

Computer equipment 5 years
Officer furniture 7 years
Leasehold improvements 15 years or term of lease whichever is less
Vehicles 5 years

The Company has not changed its estimate for the useful lives of its equipment and rental vehicles, but would expect that a decrease in the estimated useful lives of equipment and rental vehicles of one year would result in an annual increase to depreciation expense of approximately ~~$740,000,~~$600,000, and an increase in the estimated useful lives of equipment and rental vehicles of one year would result in an annual decrease to depreciation expense of approximately ~~$450,000.~~$400,000.

2223

Income Taxes

The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes. ASC 740 requires a company to use the asset and liability method of accounting for income taxes, whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all of, the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The Company has not changed it methodology for estimating the valuation allowance. A change in valuation allowance affect earnings in the period the adjustments are made and could be significant due to the large valuation allowance currently established.

Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. The adoption had no effect on the Company’s consolidated financial statements.

Revenue Recognition

The Company recognizes revenue primarily from renting its fleet of cars to drivers for TNC companies, such as Uber and Lyft, based on their rental agreements which are generally administered on a weekly basis. The Company recognizes revenue in accordance with FASB ASC 606, Revenue From Contracts with Customers.

We consider a signed contract or other similar documentation reflecting the terms and conditions under which products will be provided to be persuasive evidence of an arrangement. Collectability is assessed based on a number of factors, including payment history and the creditworthiness of a customer. If it is determined that collection is not reasonably assured, revenue is not recognized until collection becomes reasonably assured, which is generally upon receipt of cash.

Stock-Based Compensation

The Company records stock-based compensation in accordance with FASB ASC Topic 718, Compensation – Stock Compensation. FASB ASC Topic 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the employee’s requisite service period. The Company recognizes in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees and non-employees.

Contingencies

Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company’s management, in consultation with its legal counsel as appropriate, assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company, in consultation with legal counsel, evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates a potentially material loss contingency is not probable, but is reasonably possible, or is probable, but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.
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Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not required under Regulation S-K for “smaller reporting companies.”

Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures

We maintain a set of disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in rules and forms adopted by the SEC.

In accordance with Rule 13a-15(b) of the Exchange Act, as of the end of the period covered by this quarterly report on Form 10-Q, an evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), to assess the effectiveness of our disclosure controls and procedures as of ~~September 30, 2021.~~March 31, 2022. Based upon that evaluation, our CEO and CFO concluded that our disclosure controls and procedures were not effective to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to our management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure due to a material weakness.

23
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

To address this material weakness, management performed additional analyses and other procedures to ensure that the financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented.

Changes in Internal Controls over Financial Reporting

There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION
Item 1. Legal Proceedings.
For a description of the pending legal proceedings that could be material to the Company, please see Note 11- Contingencies.

Item 1A. Risk Factors.
Not required under Regulation S-K for “smaller reporting companies.”

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits.
Exhibit Description
31.1 C~~ertification~~Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)
31.2 Certification of the Chief Financial Officer and Secretary pursuant to Rule 13a-14(a)
32.1 Certification of the Chief Executive Officer furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2 Certification of the Chief Financial Officer and Secretary furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS* Inline XBRL Instance Document
101.SCH* Inline XBRL Taxonomy Schema
101.CAL* Inline XBRL Taxonomy Calculation Linkbase
101.DEF* Inline XBRL Taxonomy Definition Linkbase
101.LAB* Inline XBRL Taxonomy Label Linkbase
101.PRE* Inline XBRL Taxonomy Presentation Linkbase
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

2426

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

EVMO, INC.
(Registrant)

By: /s/ Stephen Sanchez
Stephen Sanchez, Chief Executive Officer

/s/ Ryan Saathoff
Ryan Saathoff, Chief Financial Officer

Date: ~~November 15, 2021~~May 16, 2022
2527


	Three Months Ended September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020

Revenue	$	2,724,180		$	2,070,821		$	7,670,795		$	5,399,018

Cost of revenue		2,285,878			1,194,957			5,982,075			3,891,307

Gross profit		438,302			875,864			1,688,720			1,507,711

Operating expenses:
Selling and marketing expenses		26,565			113,904			257,129			324,546
Product development		46,500			-			106,766			-
General and administrative expenses		3,218,912			1,088,152			6,151,507			3,845,768
Total operating expenses		3,291,977			1,202,056			6,515,402			4,170,314

Loss from operations		(2,853,675	)		(326,192	)		(4,826,682	)		(2,662,603	)

Other income (expense):
Interest and financing costs		(2,007,194	)		(65,292	)		(6,296,524	)		(212,943	)
Other income		83,541			-			83,541			-
Gain on forgiveness of debt		-			-			8,000			-
Total other income (expense)		(1,923,653	)		(65,292	)		(6,204,983	)		(212,943	)

Net loss	$	(4,777,328	)	$	(391,484	)	$	(11,031,665)		$	(2,875,546	)

Weighted average shares outstanding :
Basic		35,715,024			31,981,374			34,819,334			30,828,676
Diluted		35,715,024			31,981,374			34,819,334			30,828,676

Loss per share
Basic	$	(0.13	)	$	(0.01	)	$	(0.32	)	$	(0.09	)
Diluted	$	(0.13	)	$	(0.01	)	$	(0.32	)	$	(0.09	)


					Additional						Total
	Common Stock				Paid-in			Accumulated			Stockholders’
	Shares		Amount		Capital			Deficit			Equity (Deficit)
Balance, December 31, 2020		31,981,374	$	32	$	29,750,864		$	(28,673,992	)	$	1,076,904

Issuance of common stock for cash		100,000		-		50,000			-			50,000
Issuance of common stock for exercise of stock options		35,000		-		15,400			-			15,400
Issuance of common stock for cashless exercise of stock options		960,550		1		(1	)		-			-
Issuance of common stock for settlement of litigation		225,000		-		1,103,750			-			1,103,750
Value of warrants issued with note payable
Issuance of common stock for conversion of convertible debt		1,000,000		1		499,999			-			500,000
Issuance of common stock for settlement agreement		825,000		1		3,240,599			-			3,240,600
Issuance of common stock for financing cost		600		-		1,440			-			1,440
Beneficial conversion feature associated with convertible debt		-		-		30,000			-			30,000
Value of warrants issued with convertible debt
Fair value of warrants issued for financing costs
Stock option expense		-		-		193,587			-			193,587
Net loss		-		-		-			(4,417,663	)		(4,417,663	)

Balance, March 31, 2021		35,127,524		35		34,885,638			(33,091,655	)		1,794,018

Issuance of common stock for exercise of stock options		260,000		-		71,700			-			71,700
Issuance of common stock for settlement of litigation		-							-			-
Issuance of common stock for conversion of convertible debt									-			-
Issuance of common stock for settlement agreement									-			-
Issuance of common stock for financing cost									-			-
Beneficial conversion feature associated with convertible debt		-		-		810,634			-			810,634
Value of warrants issued with convertible debt		-		-		488,133			-			488,133
Fair value of warrants issued for financing costs		-		-		457,417			-			457,417
Stock option expense		-		-		104,387			-			104,387
Net loss		-		-		-			(1,836,674	)		(1,836,674	)

Balance, June 30, 2021		35,387,524		35		36,817,909			(34,928,329	)		1,889,615

Issuance of common stock for exercise of stock options		26,875		-		5,778			-			5,778
Issuance of common stock for cashless exercise of stock options		312,500		1		(1	)		-			-
Issuance of common stock for settlement of litigation		31,250		-		42,018			-			42,018
Value of warrants issued with note payable		-		-		778,697			-			778,697
Fair value of warrants issued for financing costs		-		-		503,690			-			503,690
Stock option expense		-		-		58,253			-			58,253
Net loss		-		-		-			(4,777,328	)		(4,777,328	)

Balance, September 30, 2021		35,758,149	$	36	$	38,206,344		$	(39,705,657	)	$	(1,499,277	)

Balance, December 31, 2019		29,427,803	$	29	$	28,735,894		$	(25,171,915	)	$	3,564,008

Stock option expense		-		-		457,242			-			457,242
Net loss		-		-		-			(1,761,220	)		(1,761,220	)

Balance, March 31, 2020		29,427,803		29		29,193,136			(26,933,135	)		2,260,030

Issuance of common stock for cash		2,553,571		3		274,997						275,000
Net loss		-		-		-			(722,842	)		(722,842	)

Balance, June 30, 2020		31,981,374		32		29,468,133			(27,655,977	)		1,812,188
Balance		31,981,374		32		29,468,133			(27,655,977	)		1,812,188

Stock option expense		-		-		240,244			-			240,244
Net loss		-		-					(391,484	)		(391,484	)

Balance, September 30, 2020		31,981,374	$	32	$	29,708,377		$	(28,047,461	)	$	1,660,948
Balance		31,981,374	$	32	$	29,708,377		$	(28,047,461	)	$	1,660,948

	2022			2021
	Three Months Ended March 31,
	2022			2021

Revenue	$	2,459,709		$	2,294,532

Cost of revenue		1,972,063			1,780,903

Gross profit		487,646			513,629

Operating expenses:
Selling and marketing expenses		64,336			165,748
Product development		19,000			9,500
General and administrative expenses		1,462,325			1,439,101
Total operating expenses		1,545,661			1,614,349

Loss from operations		(1,058,015	)		(1,100,720	)

Other income (expense):
Interest and financing costs		(452,037	)		(3,324,943	)
Other income		-			-
Gain on forgiveness of debt		-			8,000
Total other income (expense)		(452,037	)		(3,316,943	)

Net loss	$	(1,510,052	)	$	(4,417,663	)

Weighted average shares outstanding :
Basic		72,645,391			33,383,431
Diluted		72,645,391			33,383,431

Loss per share
Basic	$	(0.02	)	$	(0.13	)
Diluted	$	(0.02	)	$	(0.13	)

	2021			2020

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(11,031,665	)	$	(2,875,546	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		1,525,332			1,047,075
Stock option expense		356,227			697,486
Amortization of debt discounts		1,643,408			27,719
Common stock issued for financing costs		1,440			-
Preferred stock issued for financing costs		53,750			-
Common stock issued for settlement agreement		3,240,600			-
Common stock issued for litigation settlement		42,018			-
Gain on forgiveness of debt		(8,000	)		-
Fair value of warrants issued for financing costs		961,107			-
Operating lease expense		77,361			-
Changes in operating assets and liabilities:
Accounts receivable		(516,497	)		5,993
Prepaid expenses and other assets		(68,631	)		350,927
Accounts payable		1,656,997			908,051
Accrued expenses		830,954			26,838
Customer deposit - related party		(150,000	)		-
Operating lease liability		(68,595	)		-
Net cash used in operating activities		(1,454,194	)		188,543

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(47,051	)		-
Net cash used in investing activities		(47,051	)		-


CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock		50,000			275,000
Proceeds from exercise of stock options		92,878			-
Proceeds from advance from related parties		503,766			200,000
Repayment of advance from related parties		(603,766	)		(150,000	)
Proceeds from convertible note payable		2,500,000			-
Proceeds from notes payable, net		6,900,000			342,675
Repayment of notes payable		(809,519	)		(10,000	)
Repayment of finance lease obligations		(3,629,792	)		(2,017,915	)
Payment of deferred offering costs		(35,000	)		-
Net cash provided by (used in) financing activities		4,968,567			(1,360,240	)

NET INCREASE (DECREASE) IN CASH		3,467,322			(1,171,697	)

CASH, BEGINNING OF PERIOD		72,890			1,256,429

CASH, END OF PERIOD	$	3,540,212		$	84,732

CASH PAID FOR:
Interest	$	157,809		$	185,224
Income taxes	$	-		$	-

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES
Payment of accounts payable/accrued expenses with common stock	$	1,103,750		$	-
Finance lease obligations	$	5,692,784		$	3,400,922

	Computer equipment	5 years
	Officer furniture	7 years
	Leasehold improvements	15 years or term of lease whichever is less
	Vehicles	5 years

	●	Level 1 inputs to the valuation methodology are quoted, unadjusted prices for identical assets or liabilities in active markets.

	●	Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, as well as other than quoted prices for identical assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

	●	Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.

	September 30,			December 31,			March 31,			December 31,
	2021			2020			2022			2021

Computer equipment	$	6,046		$	6,046		$	6,046		$	6,046
Office furniture		17,401			-			17,401			17,401
Leasehold improvement		29,650			-			29,650			29,650
		53,097			6,046
Property and Equipment								53,097			53,097
Less accumulated depreciation		(6,626	)		(4,138	)		(8,366	)		(7,496	)
Equipment, net	$	46,471		$	1,908		$	44,731		$	45,601


Notes payable, December 31, 2020	$	815,546
Notes payable, December 31, 2021				$	7,500,000
Issued for cash		7,500,000			-
Payment of cost associated with issuance of note payable		(600,000	)
Debt discount related to notes payable		(778,697	)
Lease obligation converted to note payable					-
Forgiveness of note payable		(8,000	)		-
Repayments		(809,519	)		-
Amortization of debt discounts		64,641			-
Notes payable, September 30, 2021	$	6,183,971
Notes payable, March 31, 2022					7,500,000

Years ending December 31,
2022	$	156,225
2023		374,940
2024		374,940
2025		374,940
2026		6,218,955
Thereafter
Notes payable	$	7,500,000


Convertible notes, December 31, ~~2020~~2021	$	-
Issued for cash		~~2,500,000~~-
Issued for original issue discount		~~250,000~~-
Debt discount related to convertible notes		~~(1,578,767~~-	)
Conversion to common stock		~~(500,000~~-	)
Conversion to preferred stock		~~(2,250,000~~-	)
Amortization of debt discounts		~~1,578,767~~-
Convertible notes, ~~September 30, 2021~~March 31, 2022	$	-


Lease obligations, December 31, 2020	$	2,352,878
Lease obligations, December 31, 2021				$	3,989,210
New lease obligations		5,692,784			1,303,487
Disposal of leased vehicles					(1,229,692	)
Lease obligation converted to note payable					-
Payments on lease obligations		(3,629,792	)		(405,764	)
Lease obligations, September 30, 2021	$	4,415,870
Lease obligations, March 31, 2022				$	3,658,241

Twelve Months Ending September 30,

Years Ending December 31,
2022	$	2,033,761		$	1,310,334
2023		1,500,065			1,823,126
2024		1,058,833			615,200
2025					406,075
2026					71,969
Total payments		4,592,659			4,226,714
Amount representing interest		(176,789	)		(568,463	)
Lease obligation, net	$	4,415,870		$	3,658,241

		September 30,
	Classification on Balance Sheet	2021		Classification on Balance Sheet	March 31, 2021
Assets
Operating lease assets	Operating lease right of use assets	$	180,860	Operating lease right of use assets	$	109,953
Total lease assets		$	180,860		$	109,953

Liabilities
Current liabilities
Operating lease liability	Current operating lease liability	$	138,630	Current operating lease liability	$	117,432
Noncurrent liabilities
Operating lease liability	Long-term operating lease liability		50,996	Long-term operating lease liability		-
Total lease liability		$	189,626		$	117,432

Twelve Months Ending September 30,	Leases
Years Ending December 31,
2022	$	157,800		$	101,432
2023		52,600			13,150
Total payments		210,400			117,432
Less: imputed interest		(20,774	)
Total obligation		189,626			-
Less: current portion		(138,630	)		(117,432	)
Non-current capital leases obligations	$	50,996		$	-

	●	issued 27,400,000 shares of common stock through an equity capital raise at $0.50per share;
	●	issued 3,152,143 shares of common stock at $0.35per share to redeem 110,325 shares of Series B Preferred Stock;
	●	issued 3,157,857 shares of common stock at $0.35per share to redeem 110,525 shares of Series B Preferred Stock;

	●	~~issued~~ ~~100,0000~~ ~~shares of Common Stock to a member of the Company’s Board of Directors, in a negotiated transaction for $0.50~~ ~~per share, or aggregate cash consideration of $50,000~~;
	●	~~issued~~ ~~295,000~~ ~~shares of Common Stock for the exercise of~~ ~~321,875~~ ~~stock options for cash consideration of $92,878~~;
	●	~~issued~~ ~~1,273,050~~ ~~shares of Common Stock for the cashless exercise of~~ ~~1,348,525~~ ~~stock options;~~
	●	~~issued~~ ~~600~~ ~~shares of Common Stock to an investor in connection with a prior note payable agreement;~~
	●	~~issued~~ ~~1,000,000~~ ~~shares of Common Stock in connection with the conversion of a convertible note payable for $500,000~~;
	●	~~issued an aggregate of~~ ~~256,250~~ ~~shares of Common Stock in connection with legal settlements. The shares were valued at $1,145,768~~ ~~which was based on the market price of the Common Stock on the grant date; and~~
	●	~~issued~~ ~~825,000~~ shares to Acuitas Group Holdings, LLC, (“Acuitas”) which is now the Company’s largest shareholder, in connection with a settlement agreement between Acuitas and X, LLC, a company owned by the Company’s former chief executive officer. The board of directors deemed it was in the best interest of the Company to issue the shares to Acuitas. The value of the shares was $~~3,240,600~~ ~~which is based on the market price of the Company’s Common Stock at the grant date. The $3,240,600~~ ~~was expensed as financing costs as the dispute underlying the settlement agreement related to an anti-dilution of a prior investment in the Company by Acuitas.~~

						Weighted				Options Outstanding		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
				Weighted		Average
				Average		Remaining		Aggregate
	Options			Exercise		Contractual		Intrinsic
	Outstanding			Price		Life		Value
Outstanding, December 31, 2020		2,540,000		$	0.22		4.52	$	1,074,245
Outstanding, December 31, 2021											766,750	$	.53		3.76	$	98,937
Granted		290,000			0.84						40,000		.47		4.89
Forfeited		(401,475	)		0.22						-		-
Exercised		(1,670,400	)		0.230						-
Outstanding, September 30, 2021		758,125		$	0.42		3.93	$	514,928
Exercisable, September 30, 2021		413,875		$	0.56		3.99	$	262,473
Outstanding, March 31, 2022											806,750	$	0.44		3.71	$	162,791
Exercisable, March 31, 2022											619,750	$	0.50		3.86	$	98,937

Outstanding			Exercisable
Number of	Exercise		Number of	Exercise
Options	Price		Options	Price
20,000	$	0.210	20,000	$	0.210
528,125		0.215	252,625		0.215
15,000		0.220	2,500		0.220
155,000		0.530	98,750		0.530
20,000		2.120	20,000		2.120
20,000		3.800	20,000		3.800
758,125			413,875

Number of Options, Outstanding		Exercise Price, Outstanding		Number of Options, Exercisable		Exercise Price, Exercisable
Outstanding				Exercisable
Number of		Exercise		Number of		Exercise
Options		Price		Options		Price
	20,000	$	0.210		20,000	$	0.210
	516,750		0.215		372,250		0.215
	15,000		0.220		10,000		0.220
	155,000		0.530		117,500		0.530
	20,000		0.940		20,000		0.940
	20,000		2.120		20,000		2.120
	20,000		3.800		20,000		3.800
	20,000		0.390		20,000		0.390
	20,000		0.550		20,000		0.550
	806,750				619,750

					Weighted				Warrants Outstanding		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
			Weighted		Average
			Average		Remaining		Aggregate
	Warrants		Exercise		Contractual		Intrinsic
	Outstanding		Price		Life		Value
Outstanding, December 31, 2020		1,631,250	$	4.08		2.38	$	-
Outstanding, December 31, 2021										3,918,750	$	2.87		3.17	$	-
Granted		1,106,250		2.64						664,092
Forfeited		-								-
Exercised		-								-
Outstanding, September 30, 2021		2,737,500	$	3.50		2.89	$	-
Exercisable, September 30, 2021		2,737,500	$	3.50		2.89	$	-
Outstanding, March 31, 2022										4,582,842	$	2.47		3.48	$	-
Exercisable, March 31, 2022										4,582,842	$	2.47		3.48	$	-

Outstanding and Exercisable
Number of	Exercise
Warrants	Price
450,000	$	2.10
656,250		3.00
1,500,000		4.00
131,250		5.00
2,737,500

~~Risk-free interest rate~~	~~0.76~~ – ~~0.87~~	%
~~Expected life of the options~~	5 ~~years~~
~~Expected volatility~~	~~180~~%-~~190~~	%
~~Expected dividend yield~~	0	%

●	~~The Company issued an aggregate of~~ ~~187,500~~ ~~warrants pursuant to the terms of the convertible note agreement discussed in Note 6.~~

●	The parties to the In re YayYo Securities Litigation described in Note 11 above have, after extensive negotiations, recently filed a “Notice of Pending Settlement” with the court, which is subject to approval by the district court and which, if approved, will resolve the pending class actions upon payment by the Company of approximately $~~1,000,000~~ ~~to the class. The Company’s Executive Chairman has provided his personal guarantee for the whole amount due to the plaintiffs, and the Board of Directors has agreed to issue~~ ~~2,000,000~~ ~~shares of Common Stock as consideration for the guarantee. The motion for approval of the settlement is scheduled to be heard by the court on or around November 19, 2021.~~

Exhibit		Description
31.1		C~~ertification~~Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)
31.2		Certification of the Chief Financial Officer and Secretary pursuant to Rule 13a-14(a)
32.1		Certification of the Chief Executive Officer furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of the Chief Financial Officer and Secretary furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*		Inline XBRL Instance Document
101.SCH*		Inline XBRL Taxonomy Schema
101.CAL*		Inline XBRL Taxonomy Calculation Linkbase
101.DEF*		Inline XBRL Taxonomy Definition Linkbase
101.LAB*		Inline XBRL Taxonomy Label Linkbase
101.PRE*		Inline XBRL Taxonomy Presentation Linkbase
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

	EVMO, INC.
	(Registrant)

	By:	/s/ Stephen Sanchez
		Stephen Sanchez, Chief Executive Officer

		/s/ Ryan Saathoff
		Ryan Saathoff, Chief Financial Officer

	Date:	~~November 15, 2021~~May 16, 2022