UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30,~~March 31, ~~2022~~2023

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

For the transition period from _____________ to _____________

Commission File Number: 000-56148

TRAQIQ, INC.

(Exact Name of Registrant as Specified in Its Charter)

California		30-0580318
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

14205 SE 36th Street, Suite 100, Bellevue, WA		98006
(Address of Principal Executive Office)		(Zip Code)

(425) 818-0560

(Registrant’s Telephone Number, Including Area Code)

(Former name, former address and former fiscal year, if changed since last report)

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

Title of Each Class		Trading Symbol		Name of Each Exchange on which registered

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

Common Stock, $.0001 par value per share

(Title of class)

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

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

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 and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☐ Yes ☒ ~~Yes~~No ~~☐ No~~

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non- accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer”, “non-accelerated filer”, “smaller reporting company” and “emerging growth” 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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

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

The number of shares of the Registrant’s common stock, $0.0001 par value per share, outstanding as of ~~November 14, 2022,~~May 17, 2023, was ~~4,488,538~~33,939,965.

Documents incorporated by reference:

None

TRAQIQ, INC

INDEX

		Page
PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements	4

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3536

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	41

Item 4.	Controls and Procedures	42

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	43

Item 1A.	Risk Factors	43

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	43

Item 3.	Defaults Upon Senior Securities	43

Item 4.	Mine Safety Disclosures	4443

Item 5.	Other Information	4443

Item 6.	Exhibits	4443

Signatures		4544

FORWARD-LOOKING STATEMENTS

Except for any historical information contained herein, the matters discussed in this quarterly report on Form 10-Q contain certain “forward-looking statements’’ within the meaning of the federal securities laws. This includes statements regarding our future financial position, economic performance, results of operations, business strategy, budgets, projected costs, plans and objectives of management for future operations, and the information referred to under “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

These forward-looking statements generally can be identified by the use of forward-looking terminology, such as “may,’’ “will,’’ “expect,’’ “intend,’’ “estimate,’’ “anticipate,’’ “believe,’’ “continue’’ or similar terminology, although not all forward-looking statements contain these words. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, you are cautioned that any such forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Although we believe that the expectations reflected in such forward-looking statements are reasonable as of the date made, expectations may prove to have been materially different from the results expressed or implied by such forward-looking statements. Important factors that may cause actual results to differ from projections include, for example:

	●	the success or failure of management’s efforts to implement our business plan;

	●	our ability to fund our operating expenses;

	●	our ability to compete with other companies that have a similar business plan;

	●	the effect of changing economic conditions impacting our plan of operation; and

	●	our ability to meet the other risks as may be described in future filings with the Securities and Exchange Commission (the “SEC”).

Unless otherwise required by law, we also disclaim any obligation to update our view of any such risks or uncertainties or to announce publicly the result of any revisions to the forward-looking statements made in this quarterly report on Form 10-Q.

When considering these forward-looking statements, you should keep in mind the cautionary statements in this quarterly report on Form 10-Q and in our other filings with the SEC. We cannot assure you that the forward-looking statements in this quarterly report on Form 10-Q will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may prove to be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time-frame, or at all.

Item 1. Financial Statements

	Page No.

Condensed Consolidated Balance Sheets as of ~~September 30, 2022~~March 31, 2023 (unaudited) and December 31, ~~2021~~2022	5

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the ~~Nine and~~ Three Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ (unaudited)	6

Condensed Consolidated Statement of Changes in Stockholders’ Equity (Deficit) for the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ (unaudited)	7

Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ (unaudited)	8

Notes to Condensed Consolidated Financial Statements (unaudited)	9

TRAQIQ, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

~~SEPTEMBER 30, 2022~~MARCH 31, 2023 (UNAUDITED) AND DECEMBER 31, ~~2021~~2022

IN ~~US$~~USD

SEPTEMBER 30, DECEMBER 31,
2022 2021
(UNAUDITED)
ASSETS
Current Assets:
Cash $ 63,343 $ 56,329
Accounts receivable, net 465,039 774,146
Prepaid expenses and other current assets 23,242 150,272

Total Current Assets 551,624 980,747

Fixed assets, net 38,201 34,165
Intangible assets, net 1,124,867 1,206,966
Goodwill 5,863,058 5,863,058
Restricted cash 104,228 114,199
Deferred tax asset 101,072 116,111
Right-of-use asset 269,235 112,076
Long-term taxes receivable 124,681 122,136
Other assets 2,862 3,137

Total Non-current Assets 7,628,204 7,571,848

TOTAL ASSETS $ 8,179,828 $ 8,552,595

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

LIABILITIES
Current Liabilities:
Accounts payable and accrued expenses $ 2,330,356 $ 2,146,015
Cash overdraft 247,809 218,747
Accrued payroll and related taxes 264,363 412,144
Accrued taxes and duties payable 129,842 72,169
Deferred revenue - 3,831
Derivative liability 1,953,276 1,152,620
Contingent consideration - Rohuma 532,600 1,383,954
Contingent consideration - Mimo 246,067 656,179
Current portion - lease liability 12,989 13,071
Current portion - long-term debt - related parties 4,282,696 3,892,463
Current portion - long-term debt 655,262 218,972
Current portion - convertible notes payable, net of discounts 1,259,194 654,851

Total Current Liabilities 11,914,454 10,825,016

Accrued payroll and related taxes, net of current portion 168,392 -
Long-term debt, net of current portion 118,111 36,052
Lease liability, net of current portion 262,543 109,830

Total Non-current Liabilities 549,046 145,882

Total Liabilities 12,463,500 10,970,898

Commitments and contingencies - -

STOCKHOLDERS’ EQUITY (DEFICIT)
Preferred stock, par value, $0.0001, 10,000,000 shares authorized, Series A Convertible Preferred, 0 shares issued and outstanding, respectively - -
Common stock, par value, $0.0001, 300,000,000 shares authorized, 4,488,538 and 4,171,638 issued and outstanding, respectively 448 417
Subscription receivable - -
Additional paid in capital 7,924,818 6,508,931
Accumulated deficit (12,455,033 ) (8,953,768 )
Accumulated other comprehensive income (loss) 255,484 30,605

Total Stockholders’ Equity (Deficit) before Non-controlling Interest (4,274,283 ) (2,413,815 )
Non-controlling interest (9,389 ) (4,488 )

Total Stockholders’ Equity (Deficit) (4,283,672 ) (2,418,303 )

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) $ 8,179,828 $ 8,552,595
March 31, December 31,
2023 2022

ASSETS

Current Assets:
Cash $ 139,573 $ 1,312
Accounts receivable, net 65,869 -
Prepaid expenses and other current assets 11,025 65,148
Inventory 359,845 -
Total Current Assets 576,312 66,460

Fixed assets, net 1,156 -
Intangible assets, net 10,446,668 -
Goodwill 7,292,885 -
Total Non-current Assets 17,740,709 -

TOTAL ASSETS $ 18,317,021 $ 66,460

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

LIABILITIES
Current Liabilities:
Accounts payable and accrued expenses $ 932,348 $ 226,178
Contract liabilities 311,544 -
Accrued payroll and related taxes 118,750 24,221
Derivative liability 112,333,348 216,593
Current portion - long-term debt - related parties - 400,000
Notes payable 3,607,480 751,886
Convertible notes payable, net of discounts 162,094 63,781
Total Current Liabilities 117,465,564 1,682,659

Total Liabilities 117,465,564 1,682,659

STOCKHOLDERS’ EQUITY (DEFICIT)
Convertible preferred stock, par value $0.01, 10,000,000 shares authorized: - -
Preferred stock, par value, $0.0001, Series A Convertible Preferred, 0 shares issued and outstanding - -
Preferred stock, par value, $0.0001, Series B Convertible Preferred, 1,470,135 and 220,135 shares issued and outstanding, respectively 147 22
Preferred stock value 147 22
Common stock, par value, $0.0001, 300,000,000 shares authorized, 33,939,965 and 18,103,039 issued and outstanding, respectively 3,394 1,810
Additional paid in capital 30,234,923 15,904,755
Accumulated deficit (129,387,007 ) (17,522,786 )
Accumulated other comprehensive income - -

Total Stockholders’ Deficit (99,148,543 ) (1,616,199 )

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT $ 18,317,021 $ 66,460

~~The accompanying notes are an integral part of these consolidated financial statements.~~
5

TRAQIQ, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
FOR THE ~~NINE AND~~ THREE MONTHS ENDED ~~SEPTEMBER 30,~~MARCH 31, 2023 AND 2022 ~~AND 2021~~ (UNAUDITED)
IN ~~US$~~USD

2022 2021 2022 2021 2023 2022
NINE MONTHS ENDED THREE MONTHS ENDED Three Months Ended
SEPTEMBER 30, SEPTEMBER 30, March 31,
2022 2021 2022 2021 2023 2022

REVENUE $ 1,185,726 $ 2,109,087 $ 429,731 $ 789,699 $ 65,040 $ 522
COST OF REVENUE 1,095,572 1,664,570 349,551 652,542
COST OF REVENUES 37,216 11,416
GROSS PROFIT 90,154 444,517 80,180 137,157 27,824 (10,894 )

OPERATING EXPENSES
Salaries and salary related costs 530,033 492,362 170,997 183,349 170,530 100,016
Professional fees 303,136 585,422 94,490 298,134 31,951 88,051
Rent expense 31,475 23,521 14,977 8,010 473 610
Depreciation and amortization expense 86,547 54,490 37,043 17,471 409,788 -
General and administrative expenses 355,500 2,893,036 124,594 1,365,067 112,242 27,309

Total Operating Expenses 1,306,691 4,048,831 442,101 1,872,031 724,984 215,986

OPERATING LOSS (1,216,537 ) (3,604,314 ) (361,921 ) (1,734,874 ) (697,160 ) (226,880 )

OTHER INCOME (EXPENSE)
Change in fair value of derivative liability (670,656 ) (850,221 ) (492,784 ) 345,911 (16,828,293 ) -
Derivative expense - (124,966 ) - (124,966 ) (94,183,461 ) -
Gain on sale of assets - 146 - 146
PPP forgiveness and other expense (313,015 ) 10,073 (336,504 ) -
Interest expense, net of interest income (1,294,904 ) (627,720 ) (316,472 ) (264,542 ) (156,562 ) (464,180 )
Total other income (expense) (2,278,575 ) (1,592,688 ) (1,145,760 ) (43,451 )
Other income 1,255 -
Total other expense (111,167,061 ) (464,180 )

NET LOSS BEFORE PROVISION FOR INCOME TAXES (3,495,112 ) (5,197,002 ) (1,507,681 ) (1,778,325 )
NET LOSS FROM CONTINUING OPERATIONS, BEFORE PROVISION FOR INCOME TAXES (111,864,221 ) (691,060 )
Provision for income taxes – continuing operations - -
NET LOSS FROM CONTINUING OPERATIONS (111,864,221 ) (691,060 )

Provision for income taxes 11,051 86,411 - 4,415
NET LOSS FROM DISCONTINUED OPERATIONS, BEFORE PROVISION FOR INCOME TAXES -

(6,861,234
)
Provision for income taxes – discontinued operations - 5,679
NET LOSS FORM DISCONTINUED OPERATIONS - (6,866,913 )

NET LOSS (3,506,163 ) (5,283,413 ) (1,507,681 ) (1,782,740 ) (111,864,221 ) (7,557,973 )
NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST 4,901 3,970 2,556 1,407
NET INCOME ATTRIBUTABLE TO PRIOR NON-CONTROLLING INTEREST - 1,305
NET LOSS ATTRIBUTABLE TO CONTROLLING INTEREST $ (3,501,262 ) $ (5,279,443 ) $ (1,505,125 ) $ (1,781,333 ) $ (111,864,221 ) $ (7,559,278 )

Other comprehensive income (loss)
Other comprehensive loss
Foreign currency translations adjustment 224,879 3,458 11,592 30,406 - 103,298
Comprehensive loss $ (3,276,383 ) $ (5,276,865 ) $ (1,493,533 ) $ (1,751,807 ) $ (111,864,221 ) $ (7,455,980 )

Net loss per share $ (0.81 ) $ (1.37 ) $ (0.33 ) $ (0.45 )
Basic and diluted loss from continuing operations per share $ (3.38 ) $ (0.17 )
Basic and diluted loss from discontinued operations per share $ - $ (1.65 )
Basic and diluted net loss per share $ (3.38 ) $ (1.81 )

Weighted average common shares outstanding - basic and diluted 4,311,104 3,850,152 4,585,487 3,929,422 33,060,136 4,173,008

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

6
TRAQIQ, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)
FOR THE ~~NINE~~THREE MONTHS ENDED ~~SEPTEMBER 30,~~MARCH 31, 2023 AND 2022 ~~AND 2021~~ (UNAUDITED)
IN ~~US $~~USD

Shares Amount Shares Amount Common Deficit Receivable Income (Loss) Interest Total
Additional Accumulated
Series A Preferred Common Stock Paid-In
Capital- Accumulated Subscription
Other
Comprehensive
Non-
controlling
Shares Amount Shares Amount Common Deficit Receivable Income (Loss) Interest Total

Balance - January 1, 2021 50,000 $       5 3,412,245 $ 341 $ 119,650 $ (2,504,893 ) $                - $            27,721 $               - $ (2,357,176 )

Shares of stock issued for cash - - 71,250 7 455,993 - - - - 456,000

Shares of stock issued for conversion of notes payable and accrued interest - - 33,042 3 224,684 - - - - 224,687

Shares of stock issued for services rendered - - 50,000 5 436,380 - - - - 436,385

Shares of stock issued for acquisition of Rohuma (first tranche) - - 320,285 32 2,049,789 - - - - 2,049,821

Warrants earned for acquisition of Mimo - - - - 984,268 - - - - 984,268

Stock-based compensation - warrants granted for consulting - - - - 68,642 - - - - 68,642

Stock-based compensation on granting of options - - - - 108,341 - - - - 108,341

Net loss for the period - - - - - (1,691,824 ) - (6,139 ) 1,453 (1,696,510 )

Balance - March 31, 2021 50,000 5 3,886,822 388 4,447,747 (4,196,717 ) - 21,582 1,453 274,458

Shares of stock issued for cash - - 4,375 1 38,499 - - - - 38,500

Shares of stock issued for services rendered - - 125 - 1,750 - - - - 1,750

Shares of stock issued for providing note payable - - 37,500 4 446,996 - - - - 447,000

Stock-based compensation on granting of options - - - - 118,465 - - - - 118,465

Stock-based compensation for restricted stock grants (shares not issued) - - - - 40,222 - - - - 40,222

Net loss for the period - - - - - (1,811,412 ) - (20,809 ) 1,110 (1,831,111 )

Balance - June 30, 2021 50,000 $ 5 3,928,822 $ 393 $ 5,093,679 $ (6,008,129 ) $ - $ 773 $ 2,563 $ (910,716 )

Conversion of Series A Preferred Stock to Common Stock (50,000 ) (5 ) 6,899 1 4 - - - - -

Shares issued for exercise of warrants - - 56,401 6 - - (6 ) - - -

Shares of stock issued for services rendered - - 150,000 15 1,078,545 - - - - 1,078,560

Stock-based compensation - warrants granted for consulting - - - - 37,977 - - - - 37,977

Stock-based compensation on granting of options - - - - 161,691 - - - - 161,691

Stock-based compensation for restricted stock grants (shares not issued) - - - - 33,208 - - - - 33,208

Net loss for the period - - - - - (1,723,335 ) - (30,406 ) 1,407 (1,752,334 )

Balance - September 30, 2021 - - 4,142,122 415 6,405,104 (7,731,464 ) (6 ) (29,633 ) 3,970 (1,351,614 )

Balance - January 1, 2022 - $ - 4,171,638 $ 417 $ 6,508,931 $ (8,953,768 ) $ - $ 30,605 $ (4,488 ) $ (2,418,303 )

Fractional share adjustment - - 1,370 - - - - - - -

Stock-based compensation on granting of options - - - - 18,223 - - - - 18,223

Stock-based compensatuon for restricted stock grants (shares not issued) - - - - 33,208 - - - - 33,208

Warrants earned for acquisition of Mimo - - - - 410,112 - - - - 410,112

Net loss for the period - - - - (917,348 ) - 103,298 (1,305 ) (815,355 )

Balance - March 31, 2022 - - 4,173,008 417 6,970,474 (9,871,116 ) - 133,903 (5,793 ) (2,772,115 )

Shares of stock issued in warrant exercises - - 179,506 18 125 - (143 ) - - -

Shares of stock issued for acquisition of Rohuma (second tranche) - - 133,024 13 851,340 - - - - 851,353
Shares of stock issued for acquisition of Rohuma - - 133,024 13 851,340 - - - - 851,353

Stock-based compensation on granting of options - - - - 18,223 - - - - 18,223

Stock-based compensatuon for restricted stock grants (shares not issued) - - - - 33,209 - - - - 33,209

Net loss for the period - - - - - �� (1,078,792 ) - 109,989 (1,040 ) (969,843 )

Balance - June 30, 2022 - $ - 4,485,538 $ 448 $ 7,873,371 $ (10,949,908 ) $ (143 ) $ 243,892 $ (6,833 ) $ (2,839,173 )
Beginning balance - $ - 4,485,538 $ 448 $ 7,873,371 $ (10,949,908 ) $ (143 ) $ 243,892 $ (6,833 ) $ (2,839,173 )

Shares of stock issued in warrant exercises - - - - - - - - -

Shares of stock issued with convertible debt - - 3,000 - 12,300 - - - 12,300

Stock-based compensation on granting of options - - - - 18,223 - - - 18,223

Stock-based compensatuon for restricted stock grants (shares not issued) - - - - 20,924 - - - 20,908

Net loss for the period - - - - - (1,505,125 ) 11,592 (2,556 ) (1,496,089 )

Balance - September 30, 2022 - - 4,488,538 - 7,924,818 (12,455,033 ) - 255,484 (9,389 ) (4,283,672 )
Ending balance - - 4,488,538 - 7,924,818 (12,455,033 ) - 255,484 (9,389 ) (4,283,672 )
Shares Amount Shares Amount Shares Amount Common Deficit Income (Loss) Interest Total
Additional Accumulated
Series A Preferred Series B Preferred Common Stock Paid-In Capital - Accumulated Other Comprehensive Non-controlling
Shares Amount Shares Amount Shares Amount Common Deficit Income (Loss) Interest Total

Balance – January 1, 2022 - $ - - $ - 4,171,638 $ 417 $ 6,508,931 $ (8,953,768 ) $ 30,605 $ (4,488 ) $ (2,418,303 )

Fractional share adjustment - - - - 1,370 - - - - - -

Stock-based compensation on granting of options - - - - - - 18,223 - - - 18,223

Stock-based compensation for restricted stock grants (shares not issued) - - - - - - 33,208 - - - 33,208

Warrants earned for acquisition of Mimo - - - - - - 410,112 - - - 410,112

Net loss for the three months ended March 31, 2022 - - - - - - - (917,348 ) 103,298 (1,305 ) (815,355 )

Balance – March 31, 2022 - - - - 4,173,008 417 6,970,474 (9,871,116 ) 133,903 (5,793 ) (2,772,115 )

Balance – January 1, 2023 - - 220,135 22 18,103,039 1,810 15,904,755 (17,522,786 ) - - (1,616,199 )

Balance - - 220,135 22 18,103,039 1,810 15,904,755 (17,522,786 ) - - (1,616,199 )
Shares issued to settle debt - - - - 150,000 15 1,740 - - - 1,755

Shares issued as consideration for the acquisition of Recoup - - 1,250,000 125 15,686,926 1,569 14,278,880 - - - 14,280,574

Share-based compensation for restricted stock grants (shares not issued) - - - - - - 49,548 - - - 49,548

Net loss for the three months ended March 31, 2023 - - - - - - - (111,864,221 ) - - (111,864,221 )

Balance – March 31, 2023 - $ - 1,470,135 $ 147 33,939,965 $ 3,394 $ 30,234,923 $ (129,387,007 ) $ - $ - $ (99,148,543 )
Balance - $ - 1,470,135 $ 147 33,939,965 $ 3,394 $ 30,234,923 $ (129,387,007 ) $ - $ - $ (99,148,543 )

The accompanying notes are an integral part of these consolidated financial statements.

7

TRAQIQ, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE ~~NINE~~THREE MONTHS ENDED ~~SEPTEMBER 30,~~MARCH 31, 2023 AND 2022 ~~AND 2021~~
IN ~~US$~~USD

2023 2022
Three Months Ended March 31,
2022 2021 2023 2022
CASH FLOW FROM OPERTING ACTIVIITES
Net loss $ (3,501,262 ) $ (5,279,443 ) $ (111,864,221 ) $ (917,348 )
Adjustments to reconcile net loss to net cash (used in) operating activities
Change in non-controlling interest (11,592 ) (3,970 ) - (1,305 )
Bank service charges capitalized to defaulted debt principal 4,073 -
Bad debt expense 201,884 261,187 52,110 -
Forgiveness of debt (18,153 ) (10,057 ) - (15,401 )
Depreciation and amortization 86,547 54,490 250,994 24,914
Lease cost, net of repayment (3,583 ) 2,910 - 1,807
Foreign currency (gain) loss 28,802 2,658 - (11,092 )
Stock-based compensation and cashless issuance of shares 154,298 495,116
Common stock issued for services rendered - 2,037,126
Stock-based compensation 49,548 51,431
Change in fair value of derivative liability and derivative expense 670,656 975,187 111,011,754 (8,190 )
Fees paid in debt financing 3,250 - - 3,250
Amortization of discounts on debt 646,018 253,414
Amortization of discounts and convertible options on debt 158,794 292,777
Gain on sale of assets (7 ) (146 ) - (8 )
Changes in assets and liabilities
Accounts receivable (136,976 ) (618,164 ) (117,979 ) 45,052
Prepaid expenses and other current assets 245,855 31,309 54,123 21,712
Deferred revenue -
Inventory 19,873
Accounts payable, accrued expenses and deferred taxes 462,326 (393 ) 93,957 84,422
Accrued payroll and payroll taxes 59,842 8,899 94,529 6,557
Accrued duties and taxes 63,975 52,346 - 22,034
Total adjustments 2,453,142 3,541,912 111,671,776 517,960
Net cash (used in) operating activities (1,048,120 ) (1,737,531 ) (192,445 ) (399,388 )

CASH FLOWS FROM INVESTING ACTIVITES
Cash received in acquisition of Mimo - 42,905
Cash received in acquisition of Rohuma - 5,951
Acquisition of Mimo - (21,856 )
Cash received in acquisition of Recoup (150,000 ) -
Acquisition of fixed assets (32,941 ) (3,145 ) - (25,574 )
Net cash (used in) provided by investing activities (32,941 ) 23,855 (150,000 ) (25,574 )

CASH FLOWS FROM FINANCING ACTIVITES
Increase in cash overdraft 48,162 76,064 - 48,400
Proceeds from the issuance of common stock - 494,500
Proceeds from convertible notes 130,000 1,115,000 705,000 -
Repayment of convertible notes - (80,000 )
Repayments of convertible notes (60,480 ) -
Proceeds from long-term debt - related parties 609,997 1,449,394 - 205,836
Repayment of long-term debt - related parties (193,672 ) (781,326 ) - (63,973 )
Proceeds from long-term debt 753,750 50,331
Repayments of long-term debt (270,133 ) (153,706 )
Proceeds from notes payable - 344,652
Repayments of note payable (163,814 ) (58,615 )
Net cash provided by financing activities 1,078,104 2,170,257 480,706 476,300

NET (DECREASE) INCREASE IN CASH AND RESTRICTED CASH (2,957 ) 456,581
NET INCREASE IN CASH AND RESTRICTED CASH 138,261 51,338

CASH AND RESTRICTED CASH - BEGINNING OF PERIOD 170,528 58,404 1,312 170,528

CASH AND RESTRICTED CASH -END OF PERIOD $ 167,571 $ 514,985
CASH AND RESTRICTED CASH - END OF PERIOD $ 139,573 $ 221,866

CASH PAID DURING THE PERIOD FOR:
Interest expense $ 37,451 $ 51,304 $ 986 $ 7,991
Income taxes $ 5,679 $ 86,411 $ - $ 5,679

SUMMARY OF NON-CASH ACTIVITIES:
Acquisition of Rohuma:
Accounts receivable $ - $ 4,179
Prepaid and other current assets - 8,943
Right of use asset for lease liability - 331,154
Original issue discount recognized on new convertible notes 221,000 -
Shares issued for debt settlement 1,755 -
Acquisition of Recoup:
Inventory $ 379,718 $ -
Fixed assets - 4,512 1,196 -
Investment - 1,440
Intangible assets 10,697,622 -

Accounts payable and accrued expenses - (58,153 ) (612,213 ) -
Accrued duties and taxes - (2,688 )
Long-term debt - related parties - (37,776 )
Long-term debt - (10,000 )
Cash overdraft - (2,980 )
Cash - 6,027

Customer deposits (311,544 ) -
Current portion - long-term debt (3,017,090 ) -
Total net assets acquired - (86,496 ) 7,137,689 -

Consideration paid in cash (150,000 )
Consideration per Share Exchange Agreement - 3,433,776 (14,280,574 ) -

Goodwill/(Bargain Purchase Gain) $ - $ 3,520,272

Acquisition of Mimo Technologies:
Accounts receivable $ - $ 58,692
Prepaid and other current assets - 272,872
Fixed assets - 153,186
Intellectual property - 508,669
Tradenames - 169,556
Accounts payable and accrued expenses - (708,833 )
Accrued payroll and related taxes - (104,750 )
Accrued duties and taxes - (28,213 )
Long-term debt - related parties - (343,118 )
Long-term debt - (236,712 )
Comprehensive income - (42,735 )
Cash - 43,851

Total net assets acquired - (257,535 )

Consideration per Share Exchange Agreement - 2,085,653

Goodwill/(Bargain Purchase Gain) $ - $ 2,343,188

Common stock issued for conversion of long-term debt, related and unrelated parties $ - $ 224,688

Right of use asset for lease liability $ 331,154 $ -
Total Consideration (14,280,574 ) -
Goodwill $ (7,292,885 ) $ -

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

8
TRAQIQ, , INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN ~~US$)~~USD)
(UNAUDITED)

NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS

TraQiQ, Inc. (along with its wholly owned subsidiaries, referred to herein as the “Company”) was incorporated in the State of California on September 9, 2009 as Thunderclap Entertainment, Inc. On July 14, 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc. On July 19, 2017, the Company entered into a Share Exchange Agreement (“Share Exchange”) with the stockholders of OmniM2M, Inc. (“OmniM2M”) and TraQiQ Solutions, Inc. dba Ci2i Services, Inc. (formerly Ci2i Services, Inc. – amended November 6, 2019) (“Ci2i”) whereby the stockholders of Omni and Ci2i exchanged all of their respective shares, representing 100% ownership in OmniM2M and Ci2i in exchange for 1,500,000 shares of the Company’s common stock, respectively. The OmniM2M Shareholders and the Ci2i Shareholders have each been issued their respective 1,500,000 shares on a pro rata basis based on their respective holdings in OmniM2M and Ci2i in the Share Exchange Agreement. The Share Exchange was accounted for as a reverse merger whereas Ci2i is considered the accounting acquirer and TraQiQ,Inc. is considered the accounting acquiree. For accounting purposes, the acquisition of Omni is recorded at historical cost in accordance with Accounting Standard Codification (“ASC”) 805-50-25-2 as this is considered an acquisition of entities under common control as the management of the Company and Omni control the activities of the respective companies. Prior to the merger with Ci2i and acquisition of Omni, the Company was considered a shell company under Rule 12b-2 of the Exchange Act. On December 1, 2017, The Company entered into a Share Purchase Agreement (the “Share Exchange Agreement”) with Ajay Sikka (“Sikka”), the sole shareholder of Transport IQ, Inc. whereby Sikka agreed to sell all of the shares in TransportIQ, Inc. (“TransportIQ”) in exchange for $18,109, in the form of cancellation of all of the debt of TransportIQ that is owed to the Company. The transaction became effective upon the execution of the Share Exchange Agreement by Sikka and the Company; and Transport IQ, Inc, is now a wholly-owned subsidiary of the Company. Because TransportIQ was commonly controlled and owned, the transaction was recorded at the historical carrying value of TransportIQ’s assets and liabilities.

The Financial Industry Regulatory Authority on March 18, 2022, approved a reverse 1 for 8 stock split of the Company’s common shares. The reverse split was effective on March 21, 2022. The common shares and common share equivalents as well as the per-share amounts have been retroactively restated in accordance with ASC 855-10-25 and the loss per share figures have been retroactively restated in accordance with ASC 260-10-55-12.

On January 5, 2023, the Company consummated the transactions contemplated by the Asset Purchase Agreement dated as of December 30, 2022 (the “Purchase Agreement”) among Renovare Environmental, Inc. (“REI”) and BioHiTech America, LLC (“BHT” and, together with REI, the “Renovare Sellers”) and us, pursuant to which the Renovare Sellers sold and assigned to us, and we purchased and assumed from the Renovare Sellers, (a) certain assets related to the business of (i) aerobic digestion technology solutions for the disposal of food waste at the point of generation and (ii) data analytics with respect to food waste (collectively, the “Digester Business”) and (b) certain specified liabilities of the Renovare Sellers. The Company intends for the Digester Business to be one of our principal businesses going forward, and the Company intends to supplement our current business through the acquisition of complementary businesses.
Overview of the Company

~~With operations concentrated in India, Southeast Asia~~Our mission is to reduce the environmental impact of the waste management industry through the development and ~~Latin America, the Company helps~~deployment of cost-effective technology solutions. Our suite of technologies includes on-site biological processing equipment for food waste and proprietary real-time data analytics tools to reduce food waste generation. These proprietary solutions may enable certain businesses ~~in emerging markets leverage the “gig” or task economy by providing both technology solutions~~ and municipalities of all sizes to lower disposal costs while having a network of workers required to fulfill those tasks. The Company provides software as a service that enables clients to build and manage a network of contract task workers. This platform can also be used by business clients to manage their employees who are performing services, such as PC repair or food delivery. In addition, with the recent acquisition of Mimo Technologies Private Limited (“Mimo”), Mimo operates a network of over 14,000 task workers in India who make deliveries, collect payments, do background verifications, and fulfill tasks across the supply chain, as needed by business clients to deliver their products and services to their respective markets and customers.
TraQSuite is a cloud based software platform with a revenue model based on initial and transaction-based licensing fees as well as consulting fees. Licensees pay an initial per-module fee that varies dependingpositive impact on the ~~number~~environment. When used individually or in combination, we believe that our solutions can reduce the carbon footprint associated with waste transportation, repurpose non-recyclable plastics, and significantly reduce landfill usage. As we continue to expand our waste management business we plan to discontinue or spin off the remaining portions of ~~modules that are licensed. This fee is typically $10,000~~ ~~per module. Customers are also billed on a per-user or per-transaction basis every month. User fees range from a $~~75 ~~per month fee for~~ the ~~administrator to $~~5 ~~per month for regular users. Transaction fees averages about $~~1 ~~per transaction, with discounts for higher volumes. Most customers also pay initial consulting fees upfront for integration of TraQSuite with their~~ legacy ~~software and training of their employees in the use of TraQSuite.~~business.

The Company’s TraQSuite software platform powers the last mile distribution network, allowing business users to target customers, facilitate and validate transactions, track and manage task workers, manage funds and run a distribution network. Key features of the TraQSuite software include:
● ~~Last Mile delivery~~: TraQSuite’s Last-Mile software module enables a business to manage thousands of task workers across multiple geographies to deliver products and services to the users. The software platform, operating through mobile apps, allows for data sharing, delivery validation, geo-tagging and know-your-customer (KYC) requirements and can even measure customer satisfaction.
● ~~Transact~~: TraQSuite enables task workers to facilitate transactions by meeting the end customers. They can collect payments via credit cards, smart-phone swipes, SMS messages or cash. Both banked and unbanked users can buy products and services and pay with their mobile devices.
● ~~Target~~: TraQSuite enables customer transactions to be rewarded with loyalty credits, tokens or points that can be redeemed by the customer for free products, discounts and benefits. The software analyzes these transactions and purchase behaviors by using leading AI models and can deliver real time, automated and targeted offers and recommendations for additional purchases and customer retention.
The Mimo delivery and task service in India runs on the TraQSuite platform and performs deliveries and fulfills tasks for some of the largest businesses in India. Mimo provides delivery and pickup servicesCompany currently markets an aerobic digestion technology solution for the ~~banking~~disposal of food waste at the point of generation. Its line of Revolution Series Digesters has been described as self-contained, robotic digestive systems that we believe are as easy to install as a standard dishwasher with no special electrical or plumbing requirements. Units range in size depending upon capacity, with the smallest unit approximately the size of a residential washing machine. The digesters utilize a biological process to convert food waste into a liquid that we believe is safe to discharge down an ordinary drain. This process can result in a substantial reduction in costs for customers including cruise lines, restaurants, retail stores, hospitals, hotel/hospitality companies and ~~insurance industry, performing verifications, field investigations for loan requests, business verification, employment verification, collection of documents~~governmental units by eliminating the transportation and ~~customer data~~logistics costs associated with food waste disposal. The Company also expects the process reduce the greenhouse gases associated with food-waste transportation and ~~assistance~~decomposition in ~~filling out forms for banks. Mimo works with microfinance institutions~~landfills that have been linked to ~~collect cash, such as loan payments, convert cash~~climate change. The Company offers its Revolution Series Digesters in several sizes targeting small- to ~~digital forms such as debit cards,~~mid-sized food waste generation sites that are often more economical than traditional disposal methods. The Revolution Series Digesters are manufactured and conduct data collection and surveys. For consumer goods companies, Mimo does promotional marketing, last mile (hyper-local) delivery, merchant onboarding or activation, store audits, and route optimization for delivery.assembled in the United States.

The Company’s strategy is to grow the business through a combination of organic growth and strategic investments that bring new functionality and revenue streams to the Company. The plan is to enhance the functionality of our existing products, increase sales in the Indian market and entry into new emerging markets. The Company has a presence in India, Southeast Asia and Latin America, and recently added new customers in Australia, New Zealand and parts of Africa.
9

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

Ci2i is a services company founded in 1998 that develops and deploys intelligent technologies and products in order to meet the demand for sustainable, integrated solutions. Ci2i’s primary focus has been in the analytics and intelligence segments. The Company is investing significantly in building products in the area of supply chain and last mile delivery.Legacy Business
~~Ci2i’s cloud solutions and analytics services comprise software development, program management, project management, and business analytics services.~~

TraQiQ Solutions Private Limited

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation (“Mann”). On January 2, 2020, Mann changed its name to TraQiQ Solutions Private Limited (“TRAQ Pvt Ltd”). Pursuant to the Share Exchange Agreement with Mann, the Company acquired 100% of the shares of Mann and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 166,159 shares of common stock of the Company valued at ~~$268.~~$268. The warrants will be exercisable as follows: (i) 12,596 warrants immediately; (ii) 107,494 warrants exercisable ~~one-year~~one-year after the date of closing, which was extended to March 31, 2021; and (iii) 46,069 warrants exercisable ~~two-years~~two-years after the date of closing. This transaction is being recorded as a business combination under ASC 805. There were 56,400 of these warrants exercised during 2021 ~~44,554~~ ~~during 2022,~~ and ~~12,813~~57,368 warrants remain outstanding as of ~~September 30,~~March 31, 2022.

The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately. A total of 52,391 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.

Mann-India Private limited was renamed to TraQiQ Solutions Private Limited shortly after acquisition by TraQiQ Inc.

TRAQ Pvt Ltd. was established in May 2000 and is headquartered in New Delhi, India. TRAQ Pvt Ltd. is a leading software development company which, with the advent of technology, has evolved as a mature and fast-growing company committed to provide reliable and cost-effective software solutions across industries all over the world.

TRAQ Pvt Ltd. has its own experienced team of software developers dedicated towards developing various kinds of customized software.

TraQ Pvt Ltd. has been doing business around the world for over 15 years, with particular emphasis on Latin America and India. The customer list includes large enterprise Finance and Insurance companies across Latin America. The company’s product portfolio has evolved rapidly and now includes enterprise ready solutions for payment processing, mobile wallets, micro lending solutions and digital transformation.

On December 30, 2022, the Company entered into an Assignment of Stock (the “TSP Agreement”) with TraQiQ Solutions Private Ltd. (“TSP”) and LR, pursuant to which the Company sold, assigned and transferred to LR and LR purchased from the Company, all of the equity interests in TSP in exchange for nominal consideration of $1.00.
Rohuma, LLC

On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuma members agreed to exchange all of their respective membership interests in Rohuma in exchange for 536,528 shares of common stock, of which the first tranche of shares were issued on March 1, 2021 totaling 320,285 shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $3,433,776 ($6.40 per share). The Company ~~effective~~as of March 31, 2022, determined that the second tranche of shares (~~133,024~~134,132) met the criteria to be issued, and the value of $~~851,353~~858,445 was reclassified from contingent consideration to ~~stockholders’ equity.~~Obligation to Issue Common Stock. Rohuma has an Indian affiliate that is owned 99% by Rohuma and 11%% by its founding member. Rohuma controls this entity and the 1%1% ownership by the member is now less than 1% upon acquisition by the Company. This amount is reflected as a non-controlling interest.

10

Rohuma dba Kringle.ai iswas a California based software solutions company that ~~enables~~enabled digital and mobile commerce by providing enterprise class applications that cover loyalty and rewards products, payments, online ordering, distribution logistics for retail and more. Kringle ~~analyzes~~analyzed customers’ omni-channel behaviors and transactions. Using AI for digital commerce, Kringle iswas able to deliver real time, automated 1:1 recommendations and personalized content across all customer touch points.
On December 30, 2022, the Company entered into an Assignment of Units (the “Rohuma Agreement”, and, together with the MTP Agreement and the TSP Agreement, the “Disposition Agreements”) with Rohuma LLC (“Rohuma”) and Happy Kompany LLC (“Happy”) pursuant to which the Company sold, assigned and transferred to Happy, and Happy purchased from the Company, all of the equity interests in Rohuma in exchange for nominal consideration of $1.00. Pursuant to the Rohuma Agreement, the Company assumed the liabilities of Rohuma with respect to two loans with Paypal/Loanbuilder in an aggregate principal amount of $155,053 plus any accumulated interest and fees.

Mimo Technologies Private Limited

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 170,942 shares of the Company’s common stock. Of these warrants, 102,565 were earned at the date of acquisition, with the remaining 68,377 expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.008 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. The Company ~~effective~~as of March 31, 2022, determined that the criteria for vesting of the second tranche of warrants was satisfied and reclassified $410,112 from contingent consideration to additional paid in capital. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99%99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.

TraQiQ ~~operates~~operated the Mimo delivery and task service in India. This service ~~runs~~ran on the TraQSuite platform. Mimo ~~has~~had 14,000+ independent contractors across India performing deliveries and fulfilling tasks for the largest corporations in the country. Our team at Mimo ~~uses~~used a sophisticated technology platform and a smartphone app to get their tasks completed. This iswas coupled with a verification and billing system that ~~allows~~allowed customers of all sizes to leverage this distribution infrastructure.

Mimo ~~offers~~offered a broad set of services. These offerings ~~can~~could be classified into three broad categories:

● Data collection and client verification (surveys, verification, on-boarding),

● Cash management & handling services, and

● Distribution and demand generation (order fulfilment, demand generation, delivery services for e-commerce companies)

Mimo ~~assists~~assisted the delivery and pickup segment of the banking and insurance industry by performing verifications, field investigations for loan requests, business verifications and employment verification, and also ~~collects~~collected documents, ~~assists~~assisted in filling forms for banks, and ~~completes~~completed data collection from customers.

Mimo ~~works~~worked with microfinance institutions to collect cash, such as loan payments, convert cash to digital means like debit cards, and conduct data collection and surveys.

For consumer goods companies, Mimo ~~does~~did promotional marketing, Last mile (hyper-local) delivery, merchant onboarding or activation, store audits, and route optimization for delivery. Mimo ~~provides~~provided efficient end-to-end transshipment logistics. The framework ~~manages~~managed and ~~optimizes~~optimized last-mile delivery & e-commerce logistics across the entire distribution chain with transparency and seamless integration.

~~Mimo is currently in the planning stages to provide food, alcohol & medicine deliveries as well.~~
11

During the COVID-19 pandemic, Mimo leveraged video as a platform for verification and document delivery. ~~Now, the task workers include people who are in the field on bikes and trucks, people on a video screen, as well as people on the phone.~~

There ~~are~~were also data digitization tasks being done by Mimo task workers across the country. In a country like India where there are over 20 languages and multiple dialects, the task workers ~~convert~~converted paper documents into electronic form in the same language or ~~translate~~translated them into another language.

Mimo ~~provides~~provided delivery and task worker solutions across India. Mimo works with Banking, Financial, Logistics and Distribution companies, to take their products and services to semi-urban and rural India. Mimo ~~trains~~trained the agents in each Product or Service through an online and classroom training platform. The company ~~powers~~powered the gig economy task workers throughout the country and ~~provides~~provided a very valuable source of employment for young people who may or may not have a high school diploma.

On December 30, 2022, the Company entered into an Assignment of Stock (the “MTP Agreement”) with Mimo Technologies Private Ltd. (“MTP”) and Lathika Regunathan (“LR”), pursuant to which the Company sold, assigned and transferred to LR, and LR purchased from the Company, all of the Company’s equity interests in MTP in exchange for nominal consideration of $1.00.
TraQSuite is a cloud based software platform with a revenue model based on initial and transaction-based licensing fees as well as consulting fees. Licensees pay an initial per-module fee that varies depending on the number of modules that are licensed.
The Company’s TraQSuite software platform powers the last mile distribution network, allowing business users to target customers, facilitate and validate transactions, track and manage task workers, manage funds and run a distribution network. Key features of the TraQSuite software include:
● Last Mile delivery: TraQSuite’s Last-Mile software module enables a business to manage thousands of task workers across multiple geographies to deliver products and services to the users. The software platform, operating through mobile apps, allows for data sharing, delivery validation, geo-tagging and know-your-customer (KYC) requirements and can even measure customer satisfaction.
● Transact: TraQSuite enables task workers to facilitate transactions by meeting the end customers. They can collect payments via credit cards, smart-phone swipes, SMS messages or cash. Both banked and unbanked users can buy products and services and pay with their mobile devices.
● Target: TraQSuite enables customer transactions to be rewarded with loyalty credits, tokens or points that can be redeemed by the customer for free products, discounts and benefits. The software analyzes these transactions and purchase behaviors by using leading AI models and can deliver real time, automated and targeted offers and recommendations for additional purchases and customer retention.
The Mimo delivery and task service in India runs on the TraQSuite platform and performs deliveries and fulfills tasks for some of the largest businesses in India. Mimo provides delivery and pickup services for the banking and insurance industry, performing verifications, field investigations for loan requests, business verification, employment verification, collection of documents and customer data and assistance in filling out forms for banks. Mimo works with microfinance institutions to collect cash, such as loan payments, convert cash to digital forms such as debit cards, and conduct data collection and surveys. For consumer goods companies, Mimo does promotional marketing, last mile (hyper-local) delivery, merchant onboarding or activation, store audits, and route optimization for delivery.
12
Continuing Operations
Recoup Technologies, Inc.
Recoup Technologies, Inc. provides cutting-edge solutions based on patented technologies, to measure, analyze and manage the waste management process. Recoup’s products divert food waste from landfill, reduce costs, improve operations, and minimize negative environmental impact for organizations across the world. The company offers Products (Digestors) that convert food waste into grey water discharge that is safe to enter sewage systems. The company also provides accurate real-time information to eliminate the uncertainty about where food waste occurs, how much is being wasted and its associated value. A waste tracking process forecasts accurate supply chain and inventory needs, standardizes best practices for production, and improves future planning for the prevention of waste.
TraQiQ Solutions, Inc.
Ci2i was a services company founded in 1998 that developed and deployed intelligent technologies and products in order to meet the demand for sustainable, integrated solutions. Ci2i’s primary focus has been in the analytics and intelligence segments. The Company was investing significantly in building products in the area of supply chain and last mile delivery.
Ci2i’s cloud solutions and analytics services comprised software development, program management, project management, and business analytics services.
NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the regulations of the United States Securities and Exchange Commission. The condensed consolidated financial statements and accompanying notes are the representations of the Company’s management, who are responsible for their integrity and objectivity. In their opinion, such financial information includes all adjustments considered necessary for a fair presentation at such date and the operating results and cash flows for such periods.

These condensed consolidated financial statements should be read in conjunction with a reading of the Company’s consolidated financial statements and notes thereto included in Form 10-K filed with the SEC on March 31, ~~2022.~~2023. Interim results of operations for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 are not necessarily indicative of future results for the full year.

Consolidation

The consolidated financial statements include the accounts of TraQiQ, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

The Company applies the guidance of Topic 810 Consolidation of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) to determine whether and how to consolidate another entity. Pursuant to ASC paragraph 810-10-15-10, all majority-owned subsidiaries—all entities in which a parent has a controlling financial interest—are consolidated except when control does not rest with the parent.

Pursuant to ASC paragraph 810-10-15-8, the usual condition for a controlling financial interest is ownership of a majority voting interest, and, therefore, as a general rule ownership by one reporting entity, directly or indirectly, of more than 50 percent of the outstanding voting shares of another entity is a condition pointing toward consolidation. The power to control may also exist with a lesser percentage of ownership, for example, by contract, lease, agreement with other stockholders, or by court decree.

In accordance with ASC 810-10-45, the Company has deconsolidated the subsidiaries of MTP, Rohuma and TSP as a result of the nonreciprocal transfer (spinoff). As a result of the deconsolidation the Company has recognized a loss from discontinued operations of $6,866,913 on the consolidated statements of operations for the three months ending March 31, 2022.
Noncontrolling Interests

In accordance with ASC 810-10-45 Noncontrolling Interests in Consolidated Financial Statements, the Company classifies noncontrolling interests as a component of equity within the consolidated balance sheet. In January 2021, the acquisition of Rohuma resulted in a less than 1% non-controlling interest of the Indian affiliate of that company.In February 2021, the acquisition of Mimo resulted in a less than 1% non-controlling interest of that company. On December 30, 2022, the Company sold its equity interest in Rohuma and Mimo.

1213

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that 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 periods. These estimates include, but are not limited to, management’s estimate of provisions required for non-collectible accounts receivable, depreciative lives of our assets, determination of technological feasibility, and valuation allowances of our deferred tax assets. Actual results could differ from those estimates.

Foreign Currency Transactions

The Company accounts for foreign currency transactions in accordance with ASC 830, “Foreign Currency Matters” (“ASC 830”), specifically the guidance in subsection ASC 830-20, “Foreign Currency Transactions”. The U.S. dollar is the functional and reporting currency for the Company and its ~~subsidiaries other than~~subsidiaries. The functional currency of the deconsolidated subsidiary TRAQ Pvt Ltd. ~~whose functional currency is~~was the Indian Rupee. Pursuant to ASC 830, monetary assets and liabilities denominated in foreign currencies are translated into U.S. dollars at exchange rates in effect at the balance sheet date, with the resulting gains or losses upon settlement reported in foreign exchange gain (loss) in the computation of net income (loss). Gains or losses resulting from translation adjustments are reported under accumulated other comprehensive income (loss).

Reclassification

Certain prior period amounts have been reclassified to conform with current period presentation with no effect on the Company’s net loss, total assets, liabilities equity or cash flows.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and on deposit at banking institutions as well as all highly liquid short-term investments with original maturities of 90 days or less of $~~63,343~~139,573 and $~~56,329~~1,312 as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, respectively.
~~Restricted Cash~~
The Company’s restricted cash balance consists of time deposits with financial institutions which are valued at cost and approximate fair value. Interest earned on these deposits in included in interest income. The carrying value of our restricted cash at September 30, 2022 and December 31, 2021 was $~~104,228~~ ~~and $114,199, respectively. The balances consist of time deposits pledged with financial institutions for a Line of Credit facility taken from Andhra Bank, issuance of overdraft limit.~~

Accounts Receivable and Concentration of Credit Risk

The Company considers accounts receivable, net of allowance for returns and doubtful accounts, to be fully collectible. The allowance is based on management’s estimate of the overall collectability of accounts receivable, considering historical losses and economic conditions. Based on these same factors, individual accounts are charged off against the allowance when management determines those individual accounts are uncollectible.

Credit extended to customers is generally uncollateralized. Past-due status is based on contractual terms. Management has determined that anno allowance ~~of $262,962~~for returns and $~~193,535~~doubtful accounts was required for the outstanding accounts receivable as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, respectively.

~~Property and Equipment and Long-Lived Assets~~Fixed assets, net

Fixed assets are stated at cost. Depreciation on fixed assets are computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years.
Intangible assets, net and Long-lived Assets

FASB Codification Topic 360 “Property, Plant and Equipment” (ASC 360), requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The ~~application~~adoption of ASC 360 has not materially affected the Company’s reported earnings, financial condition or cash flows.

13
Intangible assets with definite useful lives are stated at cost less accumulated amortization. Intangible assets represent purchased intangible assets of ~~TRAQ Pvt Ltd., and Mimo which includes customer relationships and trademarks.~~Recoup. The Company amortizes these intangible assets on a straight-line basis over their estimated useful lives, ~~of up to~~ 15 ~~years.~~as stated below:.
SCHEDULE OF INTANGIBLE AND LONG-LIVED ASSET CATEGORIES
Intangible and Long-Lived Asset Categories Estimated Useful Life
Intellectual property 10 Years
Non compete agreement 5 Years
Tradenames 10 Years
Goodwill Indefinite

The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The adoption of this ASU did not have a material impact on our consolidated financial statements. The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets.

The Company will assess the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable at the time they do have intangible assets. Factors the Company considers to be important which could trigger an impairment review include the following:

1. Significant underperformance relative to expected historical or projected future operating results;

2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and

3. Significant negative industry or economic trends.

When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company will measure any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. Management has determined that no impairment of long-lived assets is required for the ~~periods~~three months ended ~~September 30,~~March 31, 2023. Management has determined that impairment of long-lived assets is required for the retrospective presentation of the three months ended March 31, 2022 as a result of the discontinued operations. Please see Note 8 – Intangible Assets and ~~December 31, 2021.~~Note 9 - Goodwill.
Due to the Company’s acquisition of Recoup and the resulting recognition of goodwill from the acquisition, the Company plans on analyzing goodwill for impairment for each future reporting period.
Inventory
Inventories consist of the company’s waste-management Digester units, Digester unit spare parts, and the biological fuel used for the functioning of the Digester units. Inventories are measured at the lower of weighted average cost or market value. Write-downs and write-offs of inventory are charged to cost of revenues.

~~Capitalized Software Costs~~Contract Liabilities

~~In accordance with~~Advance payments in the ~~relevant FASB accounting guidance regarding the development~~form of ~~software~~customer deposits for goods to be sold, ~~leased,~~ or ~~marketed,~~services to be performed, are recorded by the Company ~~expenses such costs~~ as ~~they are incurred until technological feasibility has been established, at and after which time these costs are capitalized until~~contract liabilities. Deferred revenue recognized during the ~~product~~company’s revenue recognition process is ~~available for general release to customers. Once~~also recorded as contract liabilities. As a result of the ~~technological feasibility is established per ASC 985-20,~~January 5, 2023 acquisition of Recoup, the Company ~~capitalizes costs~~assumed $14,465 of deferred revenue and $297,079 of customer deposit liabilities without acquiring the associated ~~with the acquisition or development~~cash deposits. Please See Note 6 – Acquisition of ~~major software for internal and external use in the balance sheet.~~
~~Costs incurred to enhance the Company’s software products, after general market release of the services using the products, is expensed in the period they are incurred.~~
The Company only capitalizes subsequent additions, modifications or upgrades to internally developed software to the extent that such changes allow the software to perform a task it previously did not perform. The Company expenses software maintenance and training costs as incurred.Recoup Technologies, Inc.

Revenue Recognition

~~In May 2014, the FASB issued ASU No. 2014-09,~~The Company records revenue based on a five-step model in accordance with ASC 606, Revenue from Contracts with Customers, (Topic 606), specifically ASC 606-10-50-12. This standard provides a single set of guidelines for revenue recognition to be used across all industries and requires additional disclosures. The updated guidance introduces a five-step model to achieve its core principal of the entity recognizing revenue to depict the transfer of goods or services to customers at an amountwhich require that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted the updated guidance effective January 1, 2018 using the full retrospective method, however the new standard did not have a material impact on its consolidated financial position and consolidated results of operations, as it did not change the manner or timing of recognizing revenue.
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~~Professional Service Revenue~~we:

~~TRAQ Pvt Ltd. derives~~1. Identify the contract with a large part of its revenues from professional and support services, which includes revenue generated from software development projects and associated fees for consulting, implementation, training, and project management provided to customers using their systems. Revenue from arrangements with customers is recognized based oncustomer;
2. Identify the ~~Company’s satisfaction of distinct~~ performance obligations ~~identified~~ in ~~each agreement, generally at a point in time as discussed in ASC 606. In instances where multiple performance obligations are identified,~~ the ~~Company allocates~~contract;
3. Determine the transaction price of the contract;
4. Allocate the transaction price to ~~each performance obligation based on relative selling prices of each distinct product or service, and recognizes revenue related to each performance obligation at~~ the points in time that each performance obligation is satisfied. The Company’s performance obligation includes providing customization of software’s, selling of licenses, where the Company typically satisfies its performance obligations ~~prior to~~in the submission of invoices to the customer for such services. The Company’s performance obligation for consulting and technical support is delivered on as the work is being performed, which is satisfied prior to invoicing.contract;

~~The Company generally collects payment within 30 to 60 days of completion of~~5. Recognize revenue when the performance ~~obligation and there~~obligations are ~~no agency relationships.~~met or delivered.

~~Software development arrangements involving significant customization, modification or production~~When revenue is earned based on product sales, such as sales of digester equipment and parts, solid recovered fuel and recycled materials, the Company’s performance obligations are ~~accounted for~~satisfied at the point in ~~accordance with~~time when products are shipped to the ~~appropriate technical accounting guidance issued by~~customer, which is when the ~~FASB using~~customer has title and control. Therefore, the ~~percentage-of- completion method.~~Company’s contracts have a single performance obligation (shipment of product). The Company ~~recognizes revenue using periodic reported actual hours worked as a percentage~~primarily receives fixed consideration for sales of ~~total expected hours required to complete the project arrangement and applies the percentage to the total arrangement fee.~~products.

~~Unbilled~~When revenue ~~represents earnings in excess~~is earned based on receipt of ~~billings as~~disposal waste, the Company’s performance obligations are satisfied at the ~~end~~point in time when disposal waste products are received from the customer, which is when the Company has title and control. Therefore, the Company’s contracts have a single performance obligation (receipt of the reporting period. Sales taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from revenues in the statements of operations.disposal waste).

~~TRAQ Pvt Ltd. has deferred the~~When revenue is earned on services, such as management advisory fees and ~~costs attributable to certain process transition activities with respect to its customers where such activities do not represent the culmination of a separate earnings process. Such revenue~~digester maintenance and ~~costs~~repair services, fees are ~~subsequently~~ recognized ~~ratably~~ over the period ~~in which~~ the ~~related~~ services are ~~performed. Further, the deferred costs are limited to the amount of the deferred revenues.~~performed based on service milestones.

TRAQ Pvt Ltd. has now started offering an integrated solution for supply chain and last mile. This product called “TraQSuite” is now offered in multiple markets as a cloud-based subscription offering. This is a significant improvement from the earlier professional services business.
~~Software Solution Revenue~~
Revenue from arrangements with customers is recognized based on the Company’s satisfaction of distinct performance obligations identified in each agreement, generally at a point in time as discussed in ASC 606. In instances where multiple performance obligations are identified, the Company allocates the transaction price to each performance obligation based on relative selling prices of each distinct product or service, and recognizes revenue related to each performance obligation at the points in time that each performance obligation is satisfied. The Company’s performance obligation includes providing connectivity to software, generally through a monthly subscription, where the Company typically satisfies its performance obligations prior to the submission of invoices to the customer for such services. The Company’s performance obligation for hardware components that are purchased by the customer in connection with the solution is delivery of the purchased device, which is satisfied prior to invoicing. The Company provides a twelve-month warranty on their hardware. All units deployed by the Company are past the twelve-month period, thus the Company has not accrued for a warranty liability. The Company generally collects payment within 30 to 60 days of completion of the performance obligation and there are no agency relationships.
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TraQSuite is a cloud based software platform with a revenue model based on initial and transaction-based licensing fees as well as consulting fees. Licensees pay an initial per-module fee that varies depending on the number of modules that are licensed. This fee is typically $~~10,000~~ ~~per module. Customers are also billed on a per-user or per-transaction basis every month. User fees range from a $~~75 ~~per month fee for the administrator to $~~5 ~~per month for regular users. Transaction fees averages about $~~1 per transaction, with discounts for higher volumes. Most customers also pay initial consulting fees upfront for integration of TraQSuite with their legacy software and training of their employees in the use of TraQSuite.
~~Revenue From Sales of Goods~~
Revenue from arrangements with customers is recognized based on the Company’s satisfaction of distinct performance obligations identified in each agreement, generally at a point in time as discussed in ASC 606. The performance obligations are satisfied upon shipment of the merchandise being sold.

The following is a summary of revenue for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and 2021,~~ disaggregated by ~~type:~~type for continuing operations:
SUMMARY OF DISAGGREGATION OF REVENUE
2023 2022
Professional Services Revenue $ - $ -
Sale of goods 64,611 -
Software Solution Revenue 429 522
Revenue $ 65,040 $ 139,308

2022 2021
Professional Services Revenue $ 1,027,046 $ 921,343
Sale of goods 28,805 787,150
Software Solution Revenue 129,875 400,594
$ 1,185,726 $ 2,109,087
The following is a summary of revenue for the three months ended March 31, 2023 and 2022, disaggregated by type for discontinuing operations:

SUMMARY OF DISAGGREGATION OF REVENUE
2023 2022
Professional Services Revenue (a) $      - $ 234,189
Sale of goods - -
Software Solution Revenue - 112,697
Revenue $ - $ 346,886
(a) Due to the retrospective presentation of continuing and discontinued operations, additional professional services revenue has been recognized by TRAQ Pvt Ltd. as part of discontinued operations that had been eliminated upon consolidation as an intercompany transaction prior to the disposal of TRAQ Pvt Ltd.
Costs of ~~Services Provided~~Revenues

Costs of ~~services~~revenues provided consist of ~~purchase~~the cost of goods sold, and IT support costs such as data processing costs, ~~customer support costs including personnel~~ costs to maintain the Company’s proprietary databases, ~~costs to provide customer call center support,~~ hardware and software expense associated with transaction processing systems and exchanges, ~~telecommunication~~ and computer network ~~expense, and occupancy costs associated with facilities where these functions are performed. Depreciation expense is not included in costs of services provided.~~
~~Lease Obligations~~
The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current portion of operating lease liabilities and operating lease liabilities, less current portion in the Company’s consolidated balance sheets.
ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.
Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately.expense.

Income Taxes

Income taxes are accounted under the asset and liability method. The current charge for income tax expense is calculated in accordance with the relevant tax regulations applicable to entity. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance if, based on available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

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Uncertain Tax Positions

The Company follows ASC 740-10, “Accounting for Uncertainty in Income Taxes”. This requires recognition and measurement of uncertain income tax positions using a “more-likely-than-not” approach. Management evaluates their tax positions on an annual basis.

TraQiQ, Inc.and TraQiQ Solutions, Inc, file a consolidated income tax return in the U.S. federal tax jurisdiction and various state tax jurisdictions. Recoup files a tax return in the U.S. federal tax jurisdiction and the U.S. State of Delaware. Rohuma US, part of the discontinued operations, files a separate tax return in the U.S. federal tax jurisdiction and various state tax jurisdictions. The remainder of the discontinued operations, TRAQ Pvt Ltd. ~~as well as~~and Mimo ~~and Rohuma India~~ file separate individual income tax returns in the India tax jurisdictions.
The U.S. federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed. The India tax returns of the Company are subject to examination by the India Income Tax Department and India state taxing authority, generally for 12 months after the relevant tax year, and 24 months after the relevant tax year in case transfer pricing provisions are applicable.

Fair Value of Financial Instruments

ASC 825, “Financial Instruments,” requires the Company to disclose estimated fair values for its financial instruments. The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses, stockholder advances, short term financing and convertible debt approximate fair value because of the short-term maturity of those ~~instruments. The Company does not utilize derivative~~ instruments.

Fair Value Measurements

ASC 820 “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

These consolidated financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates.

In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management for the respective periods. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, investments, short-term notes payable, accounts payable and accrued expenses.

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Derivative Financial Instruments

Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of the convertible instruments are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. Valuations derived from various models are subject to ongoing internal and external verification and review. Model used incorporate market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss).

With the issuance of the July 2017 FASB ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features, the Company has chosen the early adopt retroactively the amendments in Part I of the standard whereby fair value derivative liabilities previously recognized were derecognized in the current and comparative periods. Under the amendments included in this update, the Company is no longer required to record changes in fair value during the period of change as a separate component of other income (expense) in the consolidated Statements of Operations.

The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (in Topic 260).

The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.

Under current GAAP, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in Topic 480 is evaluated under the guidance in Topic 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting.

Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date.

The amendments in this Update revise the guidance for instruments with down round features in Subtopic 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in Subtopic 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated.

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For entities that present EPS in accordance with Topic 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by the Topic 260 amendments in this Update.

Those amendments in Part I of this Update are a cost savings relative to current GAAP. This is because, assuming the required criteria for equity classification in Subtopic 815-40 are met, an entity that issued such an instrument no longer measures the instrument at fair value at each reporting period (in the case of warrants) or separately accounts for a bifurcated derivative (in the case of convertible instruments) on the basis of the existence of a down round feature. For convertible instruments with embedded conversion options that have down round features, applying specialized guidance such as the model for contingent beneficial conversion features rather than bifurcating an embedded derivative also reduces cost and complexity. Under that specialized guidance, the issuer recognizes the intrinsic value of the feature only when the feature becomes beneficial instead of bifurcating the conversion option and measuring it at fair value each reporting period.

The amendments in Part II of this Update replace the indefinite deferral of certain guidance in Topic 480 with a scope exception. This has the benefit of improving the readability of the Codification and reducing the complexity associated with navigating the guidance in Topic 480.

For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways:

1. retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective; or

2. retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.

Earnings (Loss) Per Share of Common Stock

Basic net income (loss) per common share is computed using the weighted average number of common shares outstanding. Diluted earnings per share (EPS) include additional dilution from common stock equivalents, such as convertible notes, preferred stock, stock issuable pursuant to the exercise of stock options and warrants. Common stock equivalents are not included in the computation of diluted earnings per share when the Company reports a loss because to do so would be anti-dilutive for periods presented.

Related Party Transactions

Parties are considered to be related to the Company if the parties directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal stockholders of the Company, its management, members of the immediate families of principal stockholders of the Company and its management and other parties with which the Company may deal where one-party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions shall be recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as compensation or distribution to related parties depending on the transaction.

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~~Retirement Benefits to Employees~~
~~Defined Contribution Plan~~
In India, the employees receive benefits from a provident fund, where the employer and employees each make monthly contributions to the plan at a pre-determined rate to the Regional Provident Fund Commissioner. Employer’s contributions to the fund is charged as an expense in the Statements of Operations.
~~Defined Benefit Plan~~
In accordance with the Payment of Gratuity Act, 1972, applicable for Indian companies, our Indian entities provide for a lump sum payment to eligible employees, at retirement or termination of employment based on the last drawn salary and years of employment with the Company. Current service costs for defined benefit plans are accrued in the period to which they relate. The liability in respect of defined benefit plans is calculated annually by the Indian entities. The Indian entities record annual amounts relating to their defined benefit plans based on calculations that incorporate various actuarial and other assumptions, including discount rates, mortality, assumed rates of return, compensation increases and turnover rates. The Indian entities reserves its assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when it is appropriate to do so. The Indian entities obligation in respect of the gratuity plan, which is a defined benefit plan, is provided for based on actuarial valuation.
~~Other Long-Term Employee Benefits~~
The Indian entities net obligation in respect of leave encashment is the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is based on the prevailing market yields of Indian government securities at the reporting date that have maturity dates approximating the terms of the Indian entities obligations. The calculation is performed using the projected unit credit method. Any actuarial gains or losses are recognized.
~~Investments~~
The Company’s investments are in debt and equity instruments. These investments are accounted for in accordance with ASC 320 Investments – Debt Securities and ASC 321 Investments – Equity Securities. Interest earned under such investments are included in interest income.

Segment Reporting

For purposes of segment disclosures, two or more operating segments should be grouped only if the segments meet all the requirements of paragraph 280-10-50-11, including the requirements for similar economic characteristics.

~~As a result, all operating units perform similar services, and approximately~~Approximately 99% of the Company’s revenue is generated from its ~~Indian~~Recoup subsidiary. The Company believes that no segment reporting is required as all remaining operations outside of the ~~Indian~~Recoup subsidiary is immaterial.

Recently Issued Accounting Standards

There were updates recently issued, most of which represent technical corrections to the accounting literature or application to specific industries or transactions that are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.
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~~Going Concern~~NOTE 4: GOING CONCERN

The Company has an accumulated deficit of $~~12,455,033~~129,387,007 as of ~~September 30, 2022~~March 31, 2023 and a working capital deficit of $~~11,362,830~~116,889,252, as of ~~September 30, 2022,~~March 31, 2023, and a working capital deficit of $~~9,844,269~~1,682,659 as of December 31, ~~2021.~~2022. As a result of these factors, management has determined that there is substantial doubt about the Company ability to continue as a going concern.

These consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.
The ~~Company has recently filed~~Company’s continuation as a ~~Registration Statement~~going concern is contingent upon its ability to obtain additional financing and generate revenue and cash flow to meet its obligations on ~~Form S-1 and engaged an investment banker to undertake an offering of approximately $15,000,000. The investment banker has assisted the Company in raising~~ a ~~bridge round of debt financing in the amount of $1,200,000, which is net of original issue discount of $240,000~~.timely basis. Management intends to ~~use~~seek additional funding through debt or equity financing during the ~~funds received~~next twelve months to source new inventory and generate revenue from the capital raise to grow both organically and inorganically by pursuing potential synergistic companies as well as invest in technology and human capital for their existing operations. The Company’s ability to close on this potential offering to raise additional capital is unknown. Obtaining additional financing, including approximately $~~1,594,000~~ in the nine months ended September 30, 2022, and the successful development of the Company’s contemplated plan of operations, ultimately, to profitable operations, are necessary for the Company to continue operations.product sales.

NOTE 3:5: ~~ACQUISITIONS~~DISCONTINUED OPERATIONS
As discussed in Note 1, the Company sold Rohuma, Mimo and TSP in December of 2022. Additionally, the Company is shifting operations to waste management. As such, these businesses are reported as discontinued operations for the three months ended March 31, 2022. As required, the Company has retrospectively recast its consolidated statements of operations and balance sheets for all periods presented. The retrospective recast of the company’s income statement and balance sheet for the quarter ended March 31, 2022 resulted in a loss on discontinued operations of $6,866,913 for the quarter ended March 31, 2022. The Company has not segregated the cash flows of this business in the consolidated statements of cash flows. Management was also required to make certain assumptions and apply judgment to determine historical expenses related to the discontinued operations presented in prior periods. Unless noted otherwise, discussion in the Notes to Consolidated Financial Statements refers to the Company’s continuing operations.
The following table presents a reconciliation of the major financial lines constituting the results of operations for discontinued operations to the net income (loss) from discontinued operations presented separately in the consolidated statement of operations for the three months ended March 31, 2022:

SCHEDULE OF DISCONTINUED OPERATIONS
Rohuma Mimo TSP Total
March 31, 2022 March 31, 2022 March 31, 2022 March 31, 2022

REVENUE $ 48,085 $ 64,652 $ 234,189 $ 346,886
COST OF REVENUE 79,065 145,960 135,687 360,712
GROSS PROFIT (LOSS) (31,020 ) (81,308 ) 98,502 (13,826 )

OPERATING EXPENSES
Salaries and salary related costs 104,263 - 17,556 121,819
Professional fees 4,617 18,621 3,190 26,428
Rent expense 442 - 755 1,197
Depreciation and amortization expense - 11,644 2,145 14,840
General and administrative expenses 4,502 5,809 17,385 27,696

Total Operating Expenses 114,875 36,074 41,031 191,980

OPERATING (LOSS) INCOME (145,895 ) (117,382 ) 57,471    (205,806 )

OTHER INCOME (EXPENSE)
Loss from impairment of intangible assets - (776,263 ) - (776,263 )
Loss from impairment of goodwill (3,519,869 ) (2,343,188 ) - (5,863,057 )
Interest expense, net of interest income (2,126 ) (2,509 ) (14,280 ) (18,915 )
Other income 154 45 2,608 2,807
Total other income (expense) (3,521,841 ) (3,121,915 ) (11,672 ) (6,655,428 )

INCOME (LOSS) FROM DISTCONTINUED OPERATIONS, BEFORE PROVISION FOR INCOME TAXES (3,667,736 ) (3,239,297 ) 45,799 (6,861,234 )
Provision for income taxes – discontinued operations 367 - 5,312 5,679
LOSS INCOME FROM DISTCONTINUED OPERATIONS $ (3,668,103 ) $ (3,239,297 ) $ 40,487 $ (6,866,913 )
The following table presents a reconciliation of Rohuma, Mimo, and TSP net cash flow from operating, investing and financing activities for the periods indicated below:
March 31, 2022
Net cash (used in) provided by operating activities - discontinued operations $ 409,295
Net cash (used in) provided by investing activities - discontinued operations $ -
Net cash provided by (used in) financing activities - discontinued operations $ (468,293 )
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~~ROHUMA~~
NOTE 6: ACQUISITION OF RECOUP TECHNOLOGIES, INC.

On January ~~22, 2021,~~5, 2023, pursuant to an asset purchase agreement, dated December 30, 2022, we completed the ~~Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”)~~acquisition of Recoup Technologies, Inc., and its ~~members, whereby~~digester business assets (“Recoup” or the ~~Rohuma members agreed~~“Digester business”), from Renovare Environmental, Inc (“REI”), BioHiTech America, LLC (“BHT” and together with REI, the “Renovare Sellers”) for a purchase price of $18,371,421 consisting of the following:
SCHEDULE OF BUSINESS ACQUISITION
Type of Consideration Number of Shares Fair Value
Cash $ 150,000
Issuance of common stock a. 15,686,926 $ 1,592,318
Issuance of series – B preferred stock b. 1,250,000 $ 12,688,256
Liabilities assumed:
Michaelson Capital Senior Note c. $ 3,017,090
Accounts Payable and accrued expenses $ 612,213
Contract liabilities $ 311,544
Total consideration $ 18,371,421
a. This transaction was exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended
b. This transaction was exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended
c. Please see Note 12 – Notes Payable
The acquisition of Recoup was accounted for as a business combination in accordance with the acquisition method under the guidance in ASC 805-10 and 805-20. Accordingly, the total purchase consideration was allocated to ~~exchange all of~~intangible assets acquired based on their respective ~~membership interests~~estimated fair values. The acquisition method of accounting requires, among other things, that assets acquired, and liabilities assumed, if any, in ~~Rohuma in exchange~~a business purchase combination be recognized at their fair values as of the acquisition date. The process for ~~536,528~~ ~~shares~~estimating the fair values of ~~common stock,~~identifiable intangible assets and certain tangible assets requires the use of ~~which~~significant estimates and assumptions, including estimating future cash flows, developing appropriate discount rates, estimating the ~~first tranche of shares were issued on March 1, 2021 totaling~~ ~~320,285~~ ~~shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $3,433,776~~ ($~~6.40~~ ~~per share). The Company effective March 31, 2022, determined that the second tranche of shares (133,024) met the criteria to be issued,~~costs, and ~~the value of $851,353~~ ~~was reclassified from contingent consideration to stockholders’ equity. Rohuma has an Indian affiliate that is owned~~ 99~~% by Rohuma and~~ 1~~% by its founding member. Rohuma controls this entity and the 1% ownership by the member is now less than~~ 1~~% upon acquisition by the Company. This amount is reflected as a non-controlling interest.~~timing.

The ~~Company acquired~~allocation of the ~~assets and liabilities noted below~~purchase price in ~~exchange for the shares noted herein and accounted for~~connection with the acquisition ~~in accordance with ASC 805.~~of Recoup was calculated as follows:
SCHEDULE OF ~~BUSINESS~~ALLOCATION OF PURCHASE PRICE IN CONNECTION WITH ACQUISITION OF RECOUP
Description Fair Value Weighted Average
Useful Life
(Years)
Fixed assets – truck $ 1,196 7
Inventory 379,718
Intellectual property 10,333,144 10
Tradenames 285,863 10
Noncompete agreement 78,615 5
Goodwill 7,292,885 Indefinite
$ 18,371,421

Cash $ 6,027
Accounts receivables, net 4,179
Prepaid expenses and other current assets 8,943
Fixed assets 4,512
Investment 1,440
Accounts payable and accrued expenses (58,153 )
Accrued duties and taxes (2,688 )
Intellectual property 508,669
Tradenames 169,556
Accrued payroll and related taxes (104,750 )
Comprehensive income (42,735 )
Cash overdraft (2,980 )
Debt- related parties (37,776 )
Debt (10,000 )
Net assets and liabilities acquired $ (86,496 )
Intellectual property was measured at fair value using the multiple periods excess earnings method (“MPEEM”). Significant inputs used to measure the fair value include an estimated useful life of ten (10) years, an estimate of projected revenue and costs associated with existing customers, an estimated technology obsolescence adjustment, and a discount rate of 19.8%.
Tradenames were measured at fair value using the relief from royalty method. Significant inputs used to measure the fair value include an estimated projected revenue from the tradename, a pre-tax royalty rate of 1%, and a discount rate of 19.8%.

The ~~difference between~~noncompete agreement was measured at fair value with a discounted cash flow analysis that compared projected cash flows during the ~~net liabilities acquired~~noncompete agreement period with and without the agreement. Significant inputs used to measure the fair value include an estimate of $~~86,496~~,time for the seller to identify the product, bring in the technology, and start the ~~consideration paid (in~~manufacturing process. As well as the ~~form~~estimated risk that the Seller would chose to compete without the agreement in place and a discount rate of ~~shares, inclusive~~19.8%. The noncompete agreement prevents the Renovare Sellers from directly or indirectly, engage, or be interested in, any business or entity that engages in any business substantially similar to the Digester business for a period of ~~contingent consideration of $(~~five (~~1,383,954~~5) years following the closing date of $~~3,520,272~~, prior to a minor foreign currency translation adjustment, represents goodwill. The Company had an independent valuation consultant perform an impairment test and it was determined that no impairment exists on the ~~goodwill.~~acquisition.

Goodwill of $7,292,885 arising from the acquisition of Recoup consisted of new customer relationships for the Company, access to new product market opportunities, expected growth opportunities, and the residual value after all identifiable intangible assets were valued. Total acquisition costs for the acquisition of Recoup incurred were $86,116 recorded   as a component of General and administrative expenses. Due to the Company’s acquisition of Recoup and the resulting recognition of goodwill from the acquisition, the Company plans on analyzing goodwill for impairment for each future reporting period.
The approximate revenue and gross profit for the acquired business as a standalone entity per ASC 805 from January 5, 2023 to March 31, 2023 was $64,611 and $29,158, respectively.
Pro Forma Information
The results of operations of Recoup will be included in the Company’s consolidated financial statements as of the date of acquisition through the current period end. The following supplemental pro-forma financial information approximate combined financial information assumes that the acquisition had occurred at the beginning of the three months ended March 31, 2023 and the year ended December 31, 2022:
SCHEDULE OF PRO FORMA INFORMATION FOR BUSINESS ACQUISITION
March 31, December 31,
2023 2022
Revenue $ 64,611 $ 1,298,611
Net Income (Loss) $ (40,105 ) $ (1,514,247 )
Earnings (Loss) per common share, basic $ (0.00 ) $ (0.36 )
Earnings (Loss) per common share, diluted $ (0.00 ) $ (0.36 )
Weighted average common shares outstanding – basic and diluted 30,060,136 4,173,008
21
~~MIMO TECHNOLOGIES~~
On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase ~~170,942~~ ~~shares of the Company’s common stock. Of these warrants,~~ ~~102,565~~ ~~were earned at the date of acquisition, with the remaining~~ ~~68,377~~ ~~expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.008~~ ~~and value in the amount of $1,640,447, of which $984,268~~ ~~is reflected in additional paid in capital, with the remaining $656,179~~ ~~reflected as contingent consideration. The Company effective March 31, 2022, determined that the criteria for vesting of the second tranche of warrants was satisfied and reclassified $410,112~~ ~~from contingent consideration to additional paid in capital. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736~~ ~~in amounts due from a note receivable, $123,778~~ ~~in accounts receivable and $40,354~~ ~~in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over~~ 99~~% of Mimo with the remaining percentage of less than~~ 1~~% reflected as a non-controlling interest.~~
~~The Company acquired the assets and liabilities noted below in exchange for the warrants noted herein and accounted for the acquisition in accordance with ASC 805.~~
~~SCHEDULE OF BUSINESS ACQUISITION~~

Cash $ 43,851
Accounts receivables, net 58,692
Prepaid expenses and other current assets 272,872
Fixed assets 153,186
Intellectual property 508,669
Tradenames 169,556
Accounts payable and accrued expenses (708,833 )
Accrued payroll and related taxes (104,750 )
Accrued duties and taxes (28,213 )
Comprehensive income (42,735 )
Debt – related parties (343,118 )
Debt (236,712 )
Net assets and liabilities acquired $ (257,535 )
~~The difference between the net liabilities acquired of $(257,535), and the consideration paid (in the form of cash and warrants, net of adjustments for the note payable and accounts payable of Mimo with TRAQ Pvt Ltd) of $2,085,653~~ ~~represents goodwill in the amount of $2,343,188. The Company had an independent valuation consultant perform an impairment test and it was determined that no impairment exists on the goodwill.~~
The following table shows pro-forma results for the nine months ended September 30, 2021 as if the acquisition had occurred on January 1, 2021. These unaudited pro forma results of operations are based on the historical financial statements and related notes of Rohuma, Mimo and the Company.
~~SCHEDULE OF PROFORMA FOR BUSINESS ACQUISITION~~

For the
nine months
ended
September 30, 2021

Revenues $ 2,145,049
Net income (loss) $ (5,335,349 )
Net income (loss) per share $ (0.17 )
22
~~NOTE 4:~~ ~~CASH AND RESTRICTED CASH~~
~~Cash and restricted cash are as follows:~~
~~SCHEDULE OF CASH AND RESTRICTED CASH~~

September 30,
2022
December 31,
2021
Cash on hand $ 11,909 $ 646
Bank balances 51,434 55,683
Restricted cash 104,228 114,199
Total $ 167,571 $ 170,528
ASU 2016-18, “Statements of Cash Flows” (Topic 230) was adopted by the Company in 2017. In accordance with this standard, restricted cash and restricted cash equivalents is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the Statements of Cash Flows. During the nine months ended September 30, 2022 and 2021 there were no ~~cash equivalents.~~
~~NOTE 5:~~ ~~FIXED ASSETS~~
~~The Company’s property and equipment is as follows:~~
~~SCHEDULE OF PROPERTY AND EQUIPMENT~~

September 30,
2022

December 31,
2021

Estimated
Life

Property and equipment – TRAQ Pvt Ltd. $ 266,203 $ 627,188 3 - 10 years
Property and equipment – Rohuma US 1,100 1,100 3 - 10 years
Property and equipment – Rohuma India 10,266 9,916 3 – 10 years
Property and Equipment – Mimo Technologies 7,352 7,342 3 – 10 years
Less: accumulated depreciation (246,720 ) (611,381 )

Net $ 38,201 $ 34,165
~~Depreciation expense for the nine months ended September 30, 2022 and 2021 was $30,310~~ ~~and $13,787, respectively.~~

NOTE 6:8: INTANGIBLE ASSETS

The Company’s intangible assets are as follows:
SCHEDULE OF INTANGIBLE ASSETS

September 30,
2022

December 31,
2021

March 31,
2023

December 31,
2022

Customer relationships $ 448,800 $ 448,800
Intellectual property 508,669 508,669 $ 10,333,144 $          -
Non-compete agreement 78,615 -
Tradenames 204,043 218,799 285,863 -
Software 228,257 250,095
Intangible assets, gross 285,863 -
Less: accumulated amortization (264,902 ) (219,397 ) (250,954 ) -

Net $ 1,124,867 $ 1,206,966 $ 10,446,668 $ -
Intangible assets, net $ 10,446,668 $ -

Amortization expense due to the amortization of intangibles for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ was $~~56,237~~250,954 and $~~40,703~~0, respectively.

As of December 31, 2022, the Company did not have any intangible assets as they were previously all held by Rohuma, Mimo and TSP, and as they were fully impaired upon the disposal as Rohuma, Mimo and TSP. For the three months ended March 31, 2022, for the purposes of the retrospective presentation of the continuing operations, the Company fully impaired the Rohuma, Mimo and TSP intangible assets; resulting in impairment expense of $776,263, which is included in net loss from discontinued operations, before the provisions for income taxes, on the consolidated statements of operations and comprehensive loss.
NOTE 7:9: GOODWILL

As of March 31, 2023, all goodwill was held by Recoup. The Company’s goodwill ~~consists~~was $7,292,885 as of March 31, 2023. As of December 31, 2022, the ~~following:~~Company did not have any goodwill due to its disposal of Rohuma, Mimo, and TSP. Due to the Company’s acquisition of Recoup and the resulting recognition of goodwill from the acquisition, the Company plans on analyzing goodwill for impairment for each future reporting period.
~~SCHEDULE OF GOODWILL~~

September 30,
2022

December 31,
2021

Rohuma $ 3,519,870 $ 3,519,870
Mimo Technologies 2,343,188 2,343,188

Net $ 5,863,058 $ 5,863,058

For the ~~nine~~three months ended ~~September 30,~~March 31, 2023 there were no indicators of impairment noted. For the quarter ended March 31, 2022, for the purposes of the retrospective presentation of the disposal of Rohuma and ~~2021,~~Mimo, the Company ~~determined that there was~~ no fully impaired the Rohuma and Mimo goodwill ~~impairment.~~resulting in impairment expense of $5,863,057, which is included in net loss from discontinued operations, before the provisions for income taxes, on the consolidated statements of operations and comprehensive loss.

2322
NOTE 8:10: CONVERTIBLE NOTES PAYABLE

As of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, the Company had the following convertible notes outstanding, all of which are current liabilities. Any convertible notes payable that were repaid or converted in ~~2021,~~2022, are not listed, and details of which can be found in our Form 10-K filed March 31, 2022:
SCHEDULE OF CONVERTIBLE NOTES OUTSTANDING

September 30,
2022

December 31,
2021

Evergreen Capital Management LLC (a) $ 1,440,000 $ 1,440,000
GS Capital Partners, LLC (b) 144,000 -

Total Convertible Notes Payable $ 1,584,000 $ 1,440,000
Less: Discounts (324,806 ) (785,149 )
Convertible Notes Payable Current $ 1,259,194 $ 654,851

March 31,
2023

December 31,
2022

Evergreen Capital Management LLC - 5 (a) $ 48,000 $ 48,000
Evergreen Capital Management LLC - 4 (b) 480,000 -
Evergreen Capital Management LLC - 6 (c) 150,000 -
Evergreen Capital Management LLC - 7 (d) 12,000 -
GS Capital (e) 51,541 112,021
Chambers (f) 60,000 -
Eleven 11 Management LLC - 1 (g) 84,000 -
Eleven 11 Management LLC – 2 (h) 60,000 -
Cavalry Fund – 1 (i) 120,000 -
Cavalry Fund – 2 (j) 140,000 -
Cavalry Fund – 3 (k) 100,000 -
Keystone Capital – 1 (l) 90,000 -
Keystone Capital – 2 (m) 30,000 -
Total Convertible Notes Payable $
1,425,541
$ 160,021
Less: Discounts (1,263,447 ) (96,240 )
Convertible Notes Payable $ 162,094 $ 63,781

(a) On ~~September 17, 2021,~~October 21, 2022, the Company entered into a 20%20% OID Senior Secured Promissory Note (“Evergeen – 5”) with Evergreen Capital Management, LLC ~~(the “Evergreen 1”~~(“Evergreen”) in the amount of $~~720,000~~48,000 ~~(includes~~(including a $~~120,000~~8,000 of Original Issue Discount). ~~The~~ Evergreen 1- 5 has a maturity of ~~nine~~twelve months to ~~June 17, 2022~~July 21, 2023. ~~The Evergreen 1~~It accrues interest at a rate of 10% per year. Evergreen - 5 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price ~~of Evergreen 1~~ is ~~the lower of (a) $~~equal to ~~11.60~~ ~~(“Fixed Conversion Price”) or (b) upon the occurrence and during the continuation of any Event of Default, if lower,~~ 9075% of the ~~average~~price per share at which the common stock of the ~~two lowest VWAPs for the five (~~5~~) consecutive Trading Day that~~Company is ~~immediately prior~~sold to the ~~applicable Conversion Date (the “Default Conversion Price”).~~public in a qualified offering. There are certain price protections, ~~for Evergreen Capital Management LLC under the terms of Evergreen 1,~~ which make the conversion option a derivative liability. The Company has not repaid this note as of the maturity date and is currently in negotiations with Evergreen Capital Management LLC on revised terms. As a result, this note is in default and subject to the Default Conversion Price. The Company granted ~~62,069~~ ~~warrants that have a term of~~ ~~five-years~~ ~~and an exercise price of $11.60~~ ~~per share with Evergreen 1. The warrants granted with Evergreen 1 also contain certain price protections, that make the value of the warrants a derivative liability.~~
~~As a commission on this note, the Company granted to the investment bankers,~~ ~~4,966~~ ~~warrants with the same terms as the Evergreen Capital Management warrants. The Company recognized a commission expense for $37,977~~ ~~on these warrants.~~
~~On October 8, 2021, the Company entered into a~~ 20~~% OID Senior Secured Promissory~~Please see Note ~~in the amount of $480,000~~ ~~(includes $80,000~~ ~~of Original Issue Discount) with Evergreen Capital Management LLC (the “Evergreen 2”). The Evergreen 2 has a~~ ~~maturity of nine months to July 8, 2022. The Evergreen 2 accrues interest at a rate of~~ 10~~% per year. The conversion price of Evergreen 2 is the lower of (a) $11.60~~ ~~(“Fixed Conversion Price”) or (b) upon the occurrence and during the continuation of any Event of Default, if lower,~~ 90~~% of the average of the two lowest VWAPs for the five (~~5) consecutive Trading Day that is immediately prior to the applicable Conversion Date (the “Default Conversion Price”). There are certain price protections for Evergreen Capital Management LLC under the terms of Evergreen 2, which make the conversion option a derivative liability. The Company has not repaid this note as of the maturity date and is currently in negotiations with Evergreen Capital Management LLC on revised terms. As a result, this note is in default and subject to the Default Conversion Price. The Company granted ~~41,379~~ ~~warrants that have a term of~~ ~~five-years~~ ~~and an exercise price of $11.60~~ ~~per share with Evergreen 2. The warrants granted with Evergreen 2 also contain certain price protections, that make the value of the warrants a derivative liability.~~
~~As a commission on this note, the Company granted to the investment bankers,~~ ~~3,310~~ ~~warrants with the same terms as the Evergreen Capital Management warrants. The Company recognized a commission expense for $9,695~~ ~~on these warrants.~~
24
~~On October~~ 15 ~~2021, the Company entered into a~~ 20– Derivative Liabilities.~~% OID Senior Secured Promissory Note in the amount of $240,000~~ ~~(includes $40,000~~ ~~of Original Issue Discount) with Evergreen Capital Management LLC (the “Evergreen 3”). The Evergreen 3 has a~~ ~~maturity of nine months to July 15, 2022. The Evergreen 3 accrues interest at a rate of~~ 10~~% per year. The conversion price of Evergreen 3 is the lower of (a) $11.60~~ ~~(“Fixed Conversion Price”) or (b) upon the occurrence and during the continuation of any Event of Default, if lower,~~ 90~~% of the average of the two lowest VWAPs for the five (~~5) consecutive Trading Day that is immediately prior to the applicable Conversion Date (the “Default Conversion Price”). There are certain price protections for Evergreen Capital Management LLC under the terms of Evergreen 3, which make the conversion option a derivative liability. The Company has not repaid this note as of the maturity date and is currently in negotiations with Evergreen Capital Management LLC on revised terms. As a result, this note is in default and subject to the Default Conversion Price. The Company granted ~~20,690~~ ~~warrants that have a term of~~ ~~five-years~~ ~~and an exercise price of $11.60~~ ~~per share with Evergreen 3. The warrants granted with Evergreen 3 also contain certain price protections, that make the value of the warrants a derivative liability.~~
~~As a commission on this note, the Company granted to the investment bankers,~~ ~~1,655~~ ~~warrants with the same terms as the Evergreen Capital Management warrants. The Company recognized a commission expense for $5,756~~ ~~on these warrants.~~
As of June 17, 2021, the Evergreen 1 note is in default as the Company has not repaid the note. Both Evergreen 2 and Evergreen 3 through July 15, 2022 are also in default as the Company has not repaid these notes by the maturity date. As these notes are in default, these notes are subject to the default interest rate of 24%.
~~Interest expense on these notes for the nine months ended September 30, 2022 is $157,572. Amortization of debt and original issue discounts was $572,294~~ ~~for the nine months ended September 30, 2022.~~

(b)
On June 15, 2021 the Company issued a $400,000 promissory note to a director with a maturity date of December 12, 2021 (“the director note”). The director note did not bear interest however the director received two tranches of 18,750 shares of Common Stock each for lending this amount. Under the terms of the director note if the note was repaid by the maturity date, one of the two tranches of 18,750 shares was to be returned. The Company and the director extended the maturity date of this note to June 14, 2022, however the note was not repaid and the company was considered to be in default on the director note.
On December 30, 2022, the director, the Company, and Evergreen Capital Management, LLC (“Evergreen”) signed a note purchase agreement (the “Evergreen note purchase”). In accordance with the Evergreen note purchase, Evergreen purchased the director note from the director, and the company issued 150,000 shares of its Common Stock to the director for a value of $17,555. Please See Note 13 – Stockholders’ equity (Deficiency).
Pursuant to the Evergreen note purchase the Company exchanged the director note with Evergreen for a secured convertible promissory note (“Evergreen – 4”) which was issued on December 30, 2022 and has a maturity date of December 31, 2023. Please Note 11 – Long-Term Debt – Related Parties and Note 15 – Derivative Liabilities.
(c) On January 4, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Evergreen – 6”) with Evergreen Capital Management, LLC (“Evergreen”) in the amount of $180,000 (including a $30,000 Original Issue Discount). Evergreen - 6 has a maturity of twelve months ending on January 4, 2024. It accrues interest at a rate of 10% per year. Evergreen - 6 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.
(d) On February 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Evergreen – 7”) with Evergreen Capital Management, LLC (“Evergreen”) in the amount of $12,000 (including a $2,000 Original Issue Discount). Evergreen - 7 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Evergreen - 7 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.
(e) On July 5, 2022, the Company entered into a 11%11% OID Senior Secured Promissory Note (the “GS Capital Note”) with GS Capital Partners LLC ~~(the “GS~~(“GS Capital”) in the amount of $144,000 ~~(includes~~(including a $14,000 of Original Issue Discount). The GS Capital Note has a ~~maturity~~term of twelve months tomaturing on July 5, 2023. It accrues interest at a rate of 12% per year. The GS Capital Note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price ~~Subject to the adjustments described herein, the conversion price (the “Conversion Price”) shall be~~is equal to 86% of the lowest trading price of the Company’s Common Stock for the 12 Trading Days immediately preceding the delivery of a notice of conversion. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivatives.
(f) On February 16, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (the “Chambers Note”) with James D. Chambers Living Trust (“Chambers”) in the amount of $60,000 (including a $10,000 Original Issue Discount). The Chambers Note has a maturity of twelve months ending on February 28, 2024. It accrues interest at a rate of 10% per year. The Chambers Note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.
(g) On February 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Eleven 11 – 1”) with Eleven 11 Management LLC. (“Eleven 11”) in the amount of $60,000 (including a $10,000 Original Issue Discount). Eleven 11 – 1 has a maturity date of February 14, 2024. It accrues interest at a rate of 10% per year. Eleven 11 - 1 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price shall be equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.
(h) On March 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Eleven 11 – 2”) with Eleven 11 Management LLC. (“Eleven 11”) in the amount of $54,000 (including a $9,000 Original Issue Discount). Eleven 11 – 2 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Eleven 11 - 2 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.
(i) On March 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Cavalry - 1”) with Cavalry Fund. (“Cavalry”) in the amount of $120,000 (including a $20,000 Original Issue Discount). Cavalry - 1 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Cavalry - 1 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.
(j) On February 16, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Cavalry – 2”) with Cavalry Fund. (“Cavalry”) in the amount of $140,000 (including a $30,000 Original Issue Discount). Cavalry – 2 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Cavalry - 2 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.
(k) On March 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Cavalry – 3”) with Cavalry Fund. (“Cavalry”) in the amount of $120,000 (including a $20,000 Original Issue Discount). Cavalry – 3 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Cavalry - 3 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.
(l) On March 3, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Keystone – 1”) with Keystone Capital Partners. (“Keystone”) in the amount of $90,000 (including a $15,000 Original Issue Discount). Keystone – 1 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Keystone - 1 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.
(m) On March 21, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Keystone – 2”) with Keystone Capital Partners. (“Keystone”) in the amount of $30,000 (including a $5,000 Original Issue Discount). Keystone – 2 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Keystone - 2 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

Interest expense on these notes for the three months ended March 31, 2023 is $22,757. Amortization of debt and original issue discounts was $158,794 for the three months ended March 31, 2023.
24
NOTE 9:11: LONG-TERM DEBT - RELATED PARTIES

The following is a summary of the current portion - long-term debt - related parties as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021:~~2022:
SCHEDULE OF LONG-TERM DEBT RELATED PARTIES

September 30,
2022

December 31,
2021

Unsecured advances - CEO (a) $ 3,287,359 $ 2,908,562
Notes payable - Satinder Thiara (b) 32,000 32,000
Promissory notes – Kunaal Sikka (c) 265,000 265,000
Notes payable – Swarn Singh (d) 195,000 195,000
Note payable - Chaudhary (e) 32,202 8,828
Note payable - Director (g) 400,000 400,000
Note payable - other (h) 17,785 -
Advances –officers (f) 53,350 83,073

Long term debt current - related parties 4,282,696 3,892,463
Current portion of long-term debt related parties (4,282,696 ) (3,892,463 )
Long-term debt – related parties $ - $ -

March 31,
2023
December 31,
2022

Note payable - Director (a) $       - $ 400,000
Long-term debt related parties - 400,000

Current portion of long-term debt related parties - (400,000 )
Long-term debt – related parties $ - $ -

(a)
~~This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at~~ 15~~% annually (1.25% monthly) and are due on demand.~~
~~(b)~~ ~~Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due~~ ~~December 31, 2021, December 13, 2016 ($10,000) which is due~~ ~~December 31, 2021, and May 1, 2018 ($25,000) which matured~~ ~~December 31, 2019~~ ~~at interest rate of~~ 15~~% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to~~ 21~~% annually (1.75% monthly). The May 1, 2018 note that matured December 31, 2019 was converted along with $12,392~~ ~~in accrued interest into~~ ~~5,499~~ ~~shares of common stock on March 5, 2021.~~
~~(c)~~ ~~Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on~~ ~~December 31, 2019, and accruing interest at an annual rate of~~ 12~~%. The note was in default as of December 31, 2019 through~~On June ~~25, 2021 when the note was extended until December 31, 2022. As a result the interest rate was changed to~~ 18~~% annually (1.50% monthly) through June 25, 2021 and then changed to~~ 6~~% annually.~~
~~Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated December~~ 15, 2021 in the ~~amount of~~Company issued a $~~250,000~~400,000~~, maturing on~~ ~~December 31, 2022, and accruing interest at an annual rate of~~ 15%.
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~~(d)~~ ~~Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of~~ 15~~% annually (1.25% monthly). These are unsecured notes. Both notes were due~~ ~~December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to~~ 21~~% annually (1.75% monthly).~~
~~Unsecured~~ promissory note to ~~Swarn Singh, father-in-law of the CEO, dated December 15, 2021, in the amount of $150,000, maturing on~~ ~~December 31, 2022, and accruing interest at an annual rate of~~ 15%.
~~(e)~~ ~~Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of~~ ~~1,100,000~~ ~~INR (approximately $14,500~~ ~~US$) due on demand at~~ 13~~% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,860~~.
~~(f)~~ ~~Note payable to officer dated June 18, 2020 in the amount of~~ ~~7,650,000~~ ~~INR (approximately $100,000~~ ~~US$) interest free and due on demand~~a director with a ~~balance~~maturity date of $~~53,350~~ ~~as of September 30, 2022.~~
~~(g)~~ ~~Note payable to a director dated June 15, 2021 that matured~~ December 12, 2021 in (“the ~~amount of $400,000~~director note”).. The director note ~~does~~did not bear interest however the director received two tranches of 18,750 shares of Common Stock each for lending this amount. Under the terms of the director note if the note was repaid by the maturity date, one of the two tranches of 18,750 shares was to be returned. The Company and the director extended the maturity date of this note to June 14, ~~2022. As of September~~2022, however the note was not repaid and the company was considered to be in default on the director note.
On December 30, 2022, the director, the Company, and Evergreen Capital Management, LLC (“Evergreen”) signed a note ~~has not been repaid. The~~purchase agreement (the “Evergreen note purchase”). In accordance with the Evergreen note purchase, Evergreen purchased the director note from the director, and the company issued 150,000 shares of its Common Stock to the director for a value of $17,555. Please See Note 13 – Stockholders’ equity (Deficiency).
Pursuant to the Evergreen note purchase the Company ~~are negotiating revised terms. As a result of the failure to repay~~ exchanged director the note ~~by the~~with Evergreen for a secured convertible promissory note (“Evergreen – 4”) which was issued on December 30, 2022 and has a maturity date ~~the note is in default.~~
~~(h)~~ of December 31, 2023. Please Note ~~payable with a company owned by the CEO dated April 2, 2022 in the amount of $17,786~~10 – Convertible Notes Payable and Note 15 – Derivative Liabilities. at 8~~% interest per annum, due on demand.~~
25

Interest expense on these notes for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021 are~~was $~~417,536~~0 and $~~264,906~~0, respectively.

NOTE ~~10:~~12: ~~LONG-TERM DEBT~~NOTES PAYABLE

The following is a summary of the ~~long-term debt~~notes payable as of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021.~~2022. Any long-term debt that ~~were~~was repaid or converted in ~~2021, are~~2022, is not listed, and the details of ~~which~~those notes can be found in our Form 10-K filed March 31, ~~2022:~~2023:
SCHEDULE OF LONG-TERM DEBT

September 30,
2022

December 31,
2021

March 31,
2023

December 31,
2022

Other debt – in default (a) $ - $ 6,000
Auto loan – ICICI Bank (d) 4,889 11,062
Baxter Credit Union (e) 100,303 99,975 (a) $ 99,976 $ 100,305
UGECL (f) 34,100 49,776
Sixth Street Lending (b) 31,569 -
Diagonal Lending (FKA Sixth Street Lending), net of discounts of $13,930 (b) 72,791 116,086
Loan Builder (g) 131,641 22,321 (c) 92,059 92,059
Loan Builder #2 (g) 47,430 - (d) 50,599 50,559
Loan Builder #3 (k) 78,846 - (e) 155,074 155,053
Satin (c) 51,010 55,890
Union Bank (h) 49,351 -
Individual (i) 25,000 - (f) 25,000 25,000
Kabbage Loan (j) 121,404 - (g) 79,325 101,271
Forward Finance (l) 19,293 - (h) 31,042 31,042
Celtic (m) 69,679 - (i) 84,524 80,511
SBA - Rohuma 10,000 10,000
Michaelson Capital (j) 2,917,090 -
Total $ 774,515 $ 255,024 $ 3,607,480 $ 751,886
Discount (1,142 ) -
Long term debt $ 3,607,480 $ 751,886
Current portion (655,262 ) (218,972 ) (3,607,480 ) (751,886 )
Long-term debt, net of current portion $ 118,111 $ 36,052 $ - $ -

(a) ~~Note payable to~~This Company signed an ~~individual~~agreement with Baxter Credit Union for $~~7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made~~ a ~~payment of $1,500~~ ~~against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider. The amount was settled in 2022.~~
~~(b)~~ ~~On February 11, 2022, the Company entered into a $115,640~~ ~~promissory note with Sixth Street Lending LLC. The promissory note contains an original issue discount of $12,390. Interest on the promissory note is eleven percent per annum (~~11~~%) and the promissory note matures~~ ~~February 11, 2023. The interest rate increases to~~ 22~~% if an event of default occurs. The Company is to make mandatory monthly payments of $12,836~~ per month in ten installments beginning March 30, 2022. Should an event of default occur, the holder of the promissory note will have the right to convert any portion of the outstanding principal and interest at the lowest price on the preceding trading day. The Company has reserved ~~180,688~~ ~~shares of common stock with the transfer agent to account for any potential conversions.~~
26
~~(c)~~ ~~Unsecured amount due from a customer.~~
~~(d)~~ ~~Loan payable with ICICI Bank, secured by the vehicle the loan was taken for.~~ ~~Payments are monthly at $752, through maturity in May 2023. The entire amount is included in current maturities.~~
~~(e)~~ ~~Revolving~~revolving loan in the amount of up to $100,000 at 4% ~~interest per annum due~~ ~~December 30, 2020~~.annual interest. The loan was renegotiated for a balance of $99,975 with similar terms at 4%4% interest per annum and is guaranteed by the CEO of the Company.

(b) On November 22, 2022, the Company entered into a $115,640 promissory note (the “Diagonal Note”) with 1800 Diagonal Lending LLC (“Diagonal”). The promissory note contains an original issue discount of $12,390. Under the terms of the diagonal Note a one-time interest expense charge of 11% of the amount owed is incurred upon issuance. The Diagonal Note matures on November 22, 2023. In the event of a default the Diagonal Note contains a provision enabling the conversion of the note into the Company’s Common Stock at an exercise price of 75% of the lowest trading price for the Common Stock during the 10 trading days prior to the conversion date.
(c) On January 14, 2022 the Company signed an agreement (“Loanbuilder – 1”)for a loan through the Loanbuilder service of Paypal, Inc. for a $125,000 loan. Under the terms of Loanbuilder – 1 the Company was to repay the loan in 52 weekly installments of $2,805 inclusive of interest of approximately 10% a year. As of December 31, 2022 this loan was considered to be in default.
(d) On July 6, 2022 Rohuma signed an agreement (“Loanbuilder – 2”) for a loan through the Loanbuilder service of Paypal, Inc. for a $75,000 loan. Under the terms of Loanbuilder – 2 the loan was to be repaid the in 52 weekly installments of $1,683. Following the transfer of all of the Company’s equity interests in Rohuma to Happy under the Rohuma Agreement, the Company assumed this liability. As of December 31, 2022 this loan was considered to be in default.
(e) On July 6, 2022 Rohuma signed an agreement (“Loanbuilder – 3”) for a loan through the Loanbuilder service of Paypal, Inc. for a $125,000 loan. Under the terms of Loanbuilder – 3 the loan was to be repaid the in 52 weekly installments of $2,458. Following the transfer of all of the Company’s equity interests in Rohuma to Happy under the Rohuma Agreement, the Company assumed this liability. As of December 31, 2022 this loan was considered to be in default.
(f) On May 16, 2022, the Company signed a promissory note for $~~COVID line~~25,000 from an individual with an annual interest rate of ~~credit from UGECL up to 4,000,000 INR in India, term~~12%. The loan matures on December 31, 2023. In the event of ~~48 months~~, default the loan incurs additional interest ~~only at 7.5% annual rate for first 12 months, then 36 equal instalments through maturity~~of 0.5~~. Current (2022) $16,890; long-term (2023) $22,587~~.% on all outstanding principal and interest owed.

(g)
~~In January 2022,~~The Company signed two Kabbage Funding Loan Agreements (together known as the ~~Company borrowed $125,000~~ ~~unsecured loan due in~~ ~~52 weekly payments~~“Kabbage Loan”) of $~~2,805~~60,400 ~~inclusive~~with American Express National Bank on September 28, 2023 and September 29 2023, respectively. Each loan included a cost of capital interest ~~at approximately~~ 10~~%. A portion~~expense of ~~these proceeds were used to pay off the prior advance from Loanbuilder from 2021.~~
~~In February 2022 the Company’s subsidiary Rohuma, borrowed~~ $~~75,000~~4,077 ~~from Loanbuilder, both~~and was to be repaid in 52 ~~weekly installments~~nine monthly repayments of $~~1,683~~3,658, followed by nine monthly payments of $35,507.
(h)
~~In July~~On August 31, 2022, the ~~Company’s subsidiary Rohuma borrowed~~Company signed a future receipts sale agreement with Forward Financing, LLC. Under the terms of the agreement the Company received $~~109,500~~25,000, net administrative fees, in exchange for $34,250 ~~from Loanbuilder, both~~of future receipts. The agreement was to be repaid in 52weekly ~~installments~~payments of $~~2,458~~1,427. The total monthly repayments were not to exceed 10
% of that month’s receipts. As of March 31, 2023, this liability is in default.
~~(h)~~ ~~Borrowed $50,000~~ ~~with repayment commencing March 2024 through maturity in February 2027.~~
(i)
~~In May~~On July 29, 2022 the Company ~~borrowed~~entered into a financing and security agreement (the “Celtic line”) with Celtic Bank Corporation (“Celtic”) whereby Celtic provided a revolving line of credit that the Company could use to draw funds. Under the terms of the agreement the servicer for the Company regarding the revolving line of credit is BlueVine Inc (“BlueVine”). The agreement does not set a specific interest rate for draws from the line of credit and instead the interest rate is specific to each draw. During the three months ended March 31, 2023 the Company was charged $~~25,000~~4,013 ~~from an individual with interest at~~ 12~~% per annum.~~in bank services fees that have been capitalized to the outstanding amount owed due to the Celtic line. The ~~loan matures~~ Celtic line is guaranteed by the Company’s CEO. As of December 31, ~~2023~~.
~~In February~~ 2022 and March 31, 2023, the ~~Company’s subsidiary Rohuma, borrowed $75,000~~ ~~from Loanbuilder, both to be repaid~~Celtic line is in 52default. ~~weekly installments of $1,683~~.

(j)
~~In August 2022,~~On January 5, 2023 the Company ~~borrowed $121,404~~ ~~unsecured loan due in~~ 18 ~~monthly payments~~closed on its acquisition of $~~7,164~~ ~~inclusive~~Recoup, and as part of ~~interest at approximately~~ ~~8.49%..~~
~~(k)~~
~~In July 2022~~the consideration for the acquisition the Company ~~borrowed~~assumed the liabilities of a $~~100,000~~3,017,090 ~~from Loanbuilder, both~~secured promissory note owed to ~~be repaid in~~ 52 ~~weekly installments of $2,244~~Michaelson Capital Special Finance Fund II, L.P. (Michaelson).
~~(l)~~
~~In August 2022,~~ Michaelson and the Company ~~borrowed $25,000~~ ~~unsecured loan due in weekly payments of $1,427~~ ~~inclusive of interest at approximately~~ 10~~%..~~
~~(m)~~
~~In July 2022 the Company entered into~~then signed a ~~financing and~~ security agreement ~~with Celtic Bank Corporation where Celtic is offering~~to amend and restate the ~~Company a revolving line of credit for the Company to draw funds. As of September~~assumed note. On December 30, 2022 the Company and Michaelson signed the amended and restated senior secured term note (the “Michaelson Note”). The Michaelson Note has ~~drawn~~a principal value of $~~75,000~~3,017,090 and an annual interest rate of 12%. Under the terms of the Michaelson Note the Company was to issue a repayment of $250,000 to Michaelson on January 31, 2023, March 31, 2023, June 30, 2023, and September 30, 2023. The remaining balance was to be repaid on December 31, 2023. Please see Note 6 - Acquisition of Recoup Technologies, Inc.
After failing to make the first $~~5,321~~250,000~~. The~~ payment required by the Michaelson Note, the Company ~~has offered up its assets~~and Michaelson agreed to a forbearance agreement under which, among other terms, the outstanding principal amount was increased by $50,000 in exchange for deferral of the payments owed under the Michaelson Note. Signed on March 3, 2023, the forbearance agreement set the following repayment terms: (1) beginning in April of 2023, the Company is to make monthly interest payments for the interest amounts owed, (2) beginning in April of 2023 the Company is to make monthly principal payments of $35,000, (3) $27,671 of interest expense was added to the accrued interest owed for March of 2023, (4) the Company was required to pay two separate payments of $50,000 during the three months ended March 31, 2023, and (5) the forbearance agreement requires a $250,000 repayment due as ~~collateral.~~of December 31, 2023.

Interest expense on these notes for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ are $~~40,344~~128,642 and $~~5,550~~9,761, respectively.

NOTE ~~11:~~ ~~CURRENT PORTION - CONVERTIBLE DEBT – RELATED AND UNRELATED PARTIES~~
~~All convertible debt was repaid or converted in 2021. These are not listed, and details can be found in our Form 10-K filed March 31, 2022.~~
~~NOTE 12:~~13: STOCKHOLDERS’ EQUITY (DEFICIT)

Series A Convertible Preferred Stock

~~On July 19, 2017, the Company approved the issuance~~As of March 31, 2023 and December 31, 2022, there are ~~50,000~~no ~~shares of its~~ Series A Convertible Preferred ~~Stock to its CEO~~shares issued and ~~on August 1, 2017, the Company sold and issued the~~ ~~50,000~~ ~~shares of its Series A Convertible Preferred Stock to its CEO at a price of $0.20~~ ~~per share for $10,000~~.outstanding.

Each outstanding share of Series A Convertible Preferred Stock is convertible into the number of shares of the Company’s common stock (the “Common Stock”) determined by dividing the Stated Value by the Conversion Price as defined below, at the option of any Series A Convertible Preferred Stock shareholder in whole or in part, at any time commencing no earlier than six (6) months after the issuance date; provided that any conversion under this section must be made during the ten (10) day period immediately following the date on which the corporation files with the Securities and Exchange Commission any periodic report on form 10-Q, 10-K or the equivalent form; provided further that, any conversion under this Section IV: (a) shall be for a minimum Stated Value of $500 of Series A Convertible Preferred Stock.

The Conversion Price for each share of Series A Convertible Preferred Stock in effect on any Conversion Date shall be (i) eighty five percent (85%) of the average closing bid price of the Common Stock over the twenty (20) trading days immediately preceding the date of conversion, (ii) but no less than par value of the Common Stock. For purposes of determining the closing bid price on any day, reference shall be to the closing bid price for a share of Common Stock on such date on the OTC Markets, as reported on Bloomberg, L.P. (or similar organization or agency succeeding to its functions of reporting prices) (the “Per Share Market Value”).

27
Series B Convertible Preferred Stock
As of March 31, 2023 and December 31, 2022, there were 1,470,135 and 220,135 shares of Series B Preferred Stock issued and outstanding, respectively.
Each outstanding share of Series B Convertible Preferred Stock is convertible into the 100 shares of the Company’s common stock at any time commencing after the issuance date. Series B Convertible Stock has no voting rights. Upon any liquidation, dissolution, or winding-up of the Corporation, whether voluntary or involuntary (a “Liquidation”), the Series B Holders shall be entitled to receive out of the assets of the Corporation, whether capital or surplus, the same amount that a holder of Common Stock would receive if the Series B Preferred were fully converted. Except for stock dividends or distributions for, Series B Holders are entitled to receive, and the Company shall pay, dividends on shares of Series B Preferred equal (on an as-if-converted-to-Common-Stock basis) to and in the same form as dividends actually paid on shares of the Common Stock when, as, and if such dividends are paid on shares of the Common Stock. No other dividends shall be paid on shares of Series B Preferred.

On ~~September 22, 2021,~~December 30, 2022, the ~~CEO converted all~~ Company exchanged outstanding debt securities of the Company with unpaid principal and interest in the amount of $~~50,000~~5,786,474 for 13,002,729 shares of its common stock and 220,135 shares of its Series ~~A Convertible~~B Preferred stock.
On January 5, 2023, pursuant to an asset purchase agreement, dated December 30, 2022, we completed the acquisition of Recoup Technologies, Inc., and its digester business assets (“Recoup” or the “Digester business”), from Renovare Environmental, Inc (“REI”), BioHiTech America, LLC (“BHT” and together with REI, the “Renovare Sellers”). The consideration for the Recoup acquisiton included the issuance of 1,250,000 shares of its Series B Preferred Stock valued at ~~the conversion price of~~ $~~7.2472~~12,688,256 ~~per share into~~ ~~6,899~~ ~~common shares. As a result, as of September 30, 2022 and December 31, 2021, there are~~ no ~~Series A Convertible Preferred shares issued and outstanding.~~.

Common Stock

As of ~~September 30,~~March 31, 2023, and December 31, 2022, the Company has ~~4,488,538~~33,939,965and 18,103,039shares issued and ~~outstanding.~~
~~During the three months ended September 30, 2022, there was~~ ~~3,000~~ ~~shares as commitment shares as additional consideration for the purchase of a convertible note.~~
~~During the three months ended June 30, 2022, there was a fractional adjustment of~~ ~~1,370~~ ~~shares,~~ ~~179,506~~ ~~shares issued in the exercise of warrants for $143~~ ~~(which is included in subscription receivable as the cash was received in July 2022), and~~ ~~133,024~~ ~~shares issued for the second tranche of shares for the Rohuma purchase valued at $851,353~~ ~~which was included in contingent consideration.~~
~~During the three months ended March 31, 2022, the Company did not issue any shares however~~ ~~1,370 shares were added as a fractional adjustment when the reverse stock split occurred.~~
~~During the three months ended December 31, 2021, the Company (a) issued~~ ~~50,730~~ ~~common shares in conversion of a convertible note payable; and (b) had~~ ~~21,250~~ ~~common shares returned upon repayment of a convertible note.~~
~~During the three months ended September 30, 2021, the Company (a) issued~~ ~~6,899~~ ~~common shares in conversion of~~ ~~50,000~~ ~~Series A Convertible Preferred Stock; (b) issued~~ ~~56,400~~ ~~common shares in the exercise of~~ ~~56,400~~ ~~warrants that were exercised for $~~45~~; and (c) issued~~ ~~150,000~~ ~~common shares to the CEO as bonus compensation valued at $1,078,560~~.
~~During the three months ended September 30, 2021, the Company (a) issued~~ ~~125~~ ~~shares of common stock for services valued at $1,750. In addition, the Company recognized $40,222~~ ~~in stock-based compensation for restricted stock grants to an advisor that vest over a~~ ~~three-year term. None of the~~ ~~43,750~~ ~~shares to this advisor have been issued as of December 31, 2021.; (b) issued~~ ~~37,500~~ ~~shares of common stock to a~~ ~~director for agreeing to lend the Company $400,000~~ ~~in a promissory note.~~ ~~18,750~~ ~~of these shares may be returned to the Company should the note be repaid by the maturity date of December 12, 2021. These~~ ~~37,500~~ ~~shares have a value of $447,000; and (c) issued~~ ~~4,375~~ ~~shares for $38,500~~.
~~During the three months ended March 31, 2021, the Company (a) issued~~ ~~71,250~~ ~~shares of common stock for $456,000; (b)~~ ~~33,042~~ ~~shares of common stock for the conversion for $181,250~~ ~~in convertible notes and $43,438~~ ~~in accrued interest; (c)~~ ~~50,000~~ ~~shares of common stock for services rendered in the amount of $436,385; and (d)~~ ~~320,285~~ ~~shares (of a total of~~ ~~536,528~~ ~~to be issued) for the purchase of Rohuma.~~
outstanding, respectively. On April 12, 2018, the Company amended its Articles of Incorporation to forward split all outstanding shares of common stock such that all issued and outstanding shares of Common Stock shall be automatically combined and reclassified such that each share of Pre-Forward Split Stock shall be combined and reclassified into four shares of Common Stock. The number of shares for all periods presented has been retroactively restated to reflect the forward split.

During the year ended December 31, 2022, there was 3,000 shares offered as commitment shares as additional consideration for the purchase of a convertible note.
On December 30, 2022, the Company exchanged outstanding debt securities of the Company with unpaid principal and interest in the amount of $5,786,474 for 13,002,729 shares of its common stock and 220,135 shares of its Series B Preferred stock.
Between October 1, 2022 and December 31, 2022, 394,219 options were exercised into 394,219 shares of the Company’s common stock for no consideration. Upon issuance, the remaining $50,004 of stock-based compensation was expensed.
On December 1, 2022, the Company issued 168,750 shares of its common stock in exchange for vested restricted stock awards valued at $393,703.
During the three months ended December 31, 2022, the Company issued 48,803 shares of its common stock in exchange for warrants for no consideration.
During the three months ended June 30, 2022, 179,506 shares were issued in the exercise of warrants for $143 (which is included in subscription receivable as the cash was received in July 2022), and 133,024 shares issued for the second tranche of shares for the Rohuma purchase valued at $851,353 which was included in contingent consideration.
During the three months ended March 31, 2022, the Company did not issue any shares, however, 1,370 shares were added as a fractional adjustment when the reverse stock split occurred.
On January 5, 2023, pursuant to an asset purchase agreement, dated December 30, 2022, we completed the acquisition of Recoup Technologies, Inc., and its digester business assets (“Recoup” or the “Digester business”), from Renovare Environmental, Inc (“REI”), BioHiTech America, LLC (“BHT” and together with REI, the “Renovare Sellers”). The consideration for the Recoup acquisiton included the issuance of 15,686,926 shares of Common Stock valued at $1,592,318.
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Common Stock Warrants

The following schedule summarizes the changes in the Company’s common stock warrants:

SCHEDULE OF COMMON STOCK WARRANTS
Weighted Weighted Weighted Weighted
Warrants Outstanding Average Average Warrants Outstanding Average Average
Number Exercise Remaining Aggregate Exercise Number Exercise Remaining Aggregate Exercise
Of Price Contractual Intrinsic Price Of Price Contractual Intrinsic Price
Shares Per Share Life Value Per Share Shares Per Share Life Value Per Share

Balance at December 31, 2021 437,691 $ 0.008 - $16.00 2.69 years $ 1,185,798 $ 5.36
Balance at December 31, 2022 121,547 $ 0.008 - 16.00 1.37 years $ 273 $ 8.31

Warrants granted - $ - - $ - $ - - $ - $ -
Warrants exercised (179,506 ) $ - - $ - $ - - $    $
Warrants expired/cancelled (12,500 ) $ - - $ - $ - - $    $

Balance at September 30, 2022 245,685 $ 0.008 - $16.00 2.82 years $ 73,395 $ 9.97
Exercisable at September 30, 2022 220,044 $ 0.008 - $16.00 2.99 years $ 34,882 $ 11.14
Balance at March 31, 2023 121,547 $ 0.008 - 16.00 8.31 years $ 60,706 $ 1.12

Balance at December 31, 2020 166,159 $ 0.008 3.87 years $ 2,125,506 $ 0.008
Exercisable at March 31, 2023 119,721 $ 0.008 - 16.00 years $ 58,438 $ 1.13

Balance at December 31, 2021 437,691 $ 0.008 - 16.00 2.69 years $ 1,185,798 $ 5.36
Warrants granted 380,323 $ 0.008-16.00 - $ - $ - - - $ -
Warrants exercised/exchanged (56,400 ) $ - - $ - $ - - $
Warrants expired/cancelled (52,391 ) $ - - $ - $ - - $

Balance at December 31, 2021 437,691 $ 0.008-16.00 2.69 years $ 1,185,798 $ 5.36
Balance at March 31, 2022 437,691 $ 0.008 - 16.00 2.49 years $ 1,151,551 $ 5.38

Exercisable at December 31, 2021 369,189 $ 0.008-16.00 2.79 years $ 830,785 $ 6.40
Exercisable at March 31, 2022 412,050 $ 0.008 - 16.00 2.49 years $ 1,022,268 $ 5.71

Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each option/warrant is estimated using the Black-Scholes valuation model. The following assumptions were used for the ~~nine~~three months ended ~~September 30, 2022~~March 31, 2023 and year ended December 31, ~~2021:~~2022:
SCHEDULE OF EACH OPTION WARRANT ESTIMATED USING THE BLACK-SCHOLES VALUATION MODEL

~~Nine~~Three Months
Ended
~~September 30, 2022~~March 31, 2023

Year Ended
December 31, ~~2021~~2022

Risk free interest rate 2.00 – 25.00 % - %
Expected term 0.87 –- 3.55 years 3 ~~years~~-
Expected volatility 169.91% - -268.79 % ~~164~~--~~269~~ %
Expected dividend yield -0.00 – 0.00 -
~~Risk-free interest rate~~% - % ~~2.00~~ %
~~On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation. Pursuant to the Share Exchange Agreement, the Company acquired~~ ~~100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities in exchange for warrants exercisable over a~~ ~~five-years to purchase~~ ~~166,159~~ ~~shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i)~~ ~~12,596~~ ~~warrants immediately upon closing; (ii)~~ ~~107,494~~ ~~warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii)~~ ~~46,069~~ ~~warrants exercisable~~ ~~two-years after the date of closing. The value of the transaction totaled $268~~ ~~and is reflected as an increase to additional paid in capital. A total of~~ ~~52,391~~ ~~of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.~~
~~On February 16, 2021, the Company entered into several stock purchase agreements for the issuance of~~ ~~71,250~~ ~~shares for cash in the amount of $456,000~~ ~~(value of $6.40~~ ~~per share). The individuals also received~~ ~~35,625~~ ~~warrants that have a term of~~ ~~three years~~ ~~at an exercise price of $16.00~~ ~~per share.~~
On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase ~~170,942~~ ~~shares of the Company’s common stock. Of these warrants,~~ ~~102,565~~ ~~were earned at the date of acquisition, with the remaining~~ ~~68,377~~ ~~expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of~~ ~~three years~~ ~~and an exercise price of $0.008~~ ~~and value in the amount of $1,640,447, of which $984,268~~ ~~is reflected in additional paid in capital, with the remaining $656,179~~ ~~reflected as contingent consideration. The Company effective March 31, 2022, determined that the criteria for vesting of the second tranche of warrants was satisfied and reclassified $410,112~~ ~~from contingent consideration to additional paid in capital. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736~~ ~~in amounts due from a note receivable, $123,778~~ ~~in accounts receivable and $40,354~~ ~~in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over~~ 99~~% of Mimo with the remaining percentage of less than~~ 1~~% reflected as a non-controlling interest.~~
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On March 8, 2021, the Company entered into a consulting agreement to provide advisory services regarding strategic planning. The agreement is for a term of one-year. The agreement calls for payments to be paid monthly in the amount of $~~3,000~~ ~~and the issuance of stock at the commencement of the agreement for~~ ~~3,125~~ ~~shares, and a~~ ~~three-year warrant for~~ ~~12,500~~ ~~warrants with a strike price of $16.00~~ ~~per share that vest March 7, 2022.~~
~~On February 12, 2021, in connection with the Platinum Point Capital note, the Company granted~~ ~~25,000~~ ~~warrants with a term of three years, at an exercise price of $16.00. The warrants have price protections, and as a result of the granting of warrants in the Evergreen Capital Management transaction on September 17, 2021, the exercise price was reduced to $11.60~~.
~~On September 17, 2021, the Company granted~~ ~~62,069~~ ~~warrants with a term of~~ ~~five years, at an exercise price of $11.60~~ ~~to Evergreen Capital Management LLC with the $720,000~~ ~~convertible promissory note. As a commission on this note, the Company granted to the investment bankers,~~ ~~4,966~~ ~~warrants with the same terms as the Evergreen Capital Management warrants. The Company recognized a commission expense for $37,977~~ ~~on these warrants. These issuances triggered a price protection clause in the Platinum Point Capital warrants and reduced their exercise price to $11.60~~.
~~On October 8, 2021, the Company granted~~ ~~41,379~~ ~~warrants with a term of~~ ~~five years, at an exercise price of $11.60~~ ~~to Evergreen Capital Management LLC with the $480,000~~ ~~convertible promissory note. As a commission on this note, the Company granted to the investment bankers,~~ ~~3,310~~ ~~warrants with the same terms as the Evergreen Capital Management warrants. The Company recognized a commission expense for $9,695~~ ~~on these warrants. These issuances triggered a price protection clause in the Platinum Point Capital warrants and reduced their exercise price to $11.60~~.
~~On October 15, 2021, the Company granted~~ ~~20,690~~ ~~warrants with a term of~~ ~~five years, at an exercise price of $11.60~~ ~~to Evergreen Capital Management LLC with the $240,000~~ ~~convertible promissory note. As a commission on this note, the Company granted to the investment bankers,~~ ~~1,655~~ ~~warrants with the same terms as the Evergreen Capital Management warrants. The Company recognized a commission expense for $5,756~~ ~~on these warrants. These issuances triggered a price protection clause in the Platinum Point Capital warrants and reduced their exercise price to $11.60~~.

In June 2022, there were 44,554 warrants exercised for $143. In addition, in June 2022, ~~there was~~ 12,500 warrants that had previously been granted to a consultant ~~that~~ were cancelled.

In December 2022, there were 134,952 warrants exercised for $0. In addition, in December 2022, 124,138 warrants that had previously been granted to a consultant were cancelled.
~~Options~~NOTE 14: STOCK-BASED COMPENSATION

On November 23, 2020, the Board of Directors of the Company approved the 2020 Equity Incentive Plan.
Options

On October 19, 2020, the Company granted 491,250 stock options to board members, advisory board members, employees and consultants. The options have a 10-year term, and are both ~~service based~~service-based grants, as well as performance-based grants. ~~Through~~As of March 31, ~~2022 a total~~2023 all of ~~342,879~~the options ~~have vested.~~ had vested, and had been either exercised or had expired.
Stock based compensation expense from options for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ were $~~54,669~~0 and $~~388,498~~18,223, respectively. As of ~~September 30, 2022,~~March 31, 2023, there remains $~~194,180~~0 of unrecognized ~~stock based compensation.~~stock-based compensation from options.

The following represents a summary of options:
SUMMARY OF STOCK OPTION

Nine Months Ended
September 30, 2022

Year Ended
December 31, 2021

Three Months Ended
March 31, 2023

Year Ended
December 31, 2022

Number
Weighted
Average
Exercise
Price
Number Weighted
Average
Exercise
Price Number
Weighted
Average
Exercise Price
Number
Weighted
Average
Exercise Price

Beginning balance 491,250 $ 0.0416 491,250 $ 0.0416 - $          - 491,250 $ 0.0416

Granted - - - - - - - -
Exercised - - - - - - (394,065 ) -
Forfeited - - - - - - (97,185 ) 0.01
Expired - - - - - - - -
Ending balance 491,250 $ 0.0416 491,250 $ 0.0416 - $ - - $ -
Intrinsic value of options $ 739,222 $ 2,533,975 $ - - $ -

Weighted Average Remaining Contractual Life (Years) 8.06 8.81         - -

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Restricted Stock Awards
On November 23, 2020, the Board of Directors of the Company approved the 2020 Equity Incentive Plan.

On January 1, 2023, the Company granted 5,400,000 restricted stock awards to board members pursuant to the 2020 Equity Incentive Plan. The awards vest over a three-year term and are compensation for the board members’ service.
On January 1, 2023, the Company granted 200,000 restricted stock awards to a director pursuant to the 2020 Equity Incentive Plan. The awards vest over a four-month term and are compensation for the director’s service.
On January 1, 2023, the Company granted 5,930,000 restricted stock awards to the CEO. The awards were granted as a sign-on bonus. 905,000 of the restricted stock awards vested after a three-month term, which ended on March 31, 2023. The remaining 5,430,000 shares vest in six equal installments and all begin vesting on the grant date. The first installment vests during the nine months following the grant date and the remaining installments finish vesting every six months thereafter.
On March 22, 2023, the Company granted 1,800,000 restricted stock awards to a director pursuant to the 2020 Equity Incentive Plan. The awards have a three-year term and are compensation for the director’s service.
The activity for restricted stock awards under the Company’s incentive plans is as follows for the three months ended March 31, 2023 and 2022:
SCHEDULE OF RESTRICTED STOCK AWARDS ACTIVITY
Weighted
Weighted Average
Average Remaining
Number Grant Date Contractual
Shares Fair Value Term (years)

Nonvested at December 31, 2021 - $ - -
Granted - $ -
Shares vested - $ -
Forfeitures - $ -
Nonvested at March 31, 2022 - $ - -

Nonvested at December 31, 2022 - $ - -
Granted 13,330,000 $ 0.20
Shares vested 905,000 $ 0.01
Forfeitures - $
Nonvested at March 31, 2023 12,425,000 $ 0.21 2.34
Vested and unreleased 905,000
Outstanding at March 31, 2023 13,330,000 0.20 2.34
Stock based compensation expense from restricted stock awards for the three months ended March 31, 2023 and 2022 were $49,548 and $33,208, respectively. As of March 31, 2023, there remains $2,605,353 of unrecognized stock-based compensation from restricted stock awards. The total fair value of restricted shares that vested during the three months ended March 31, 2023 and 2022 was $10,589 and $0, respectively.

NOTE ~~13:~~15: ~~OPERATING LEASE~~DERIVATIVE LIABILITIES

On June 15, 2021 the Company issued a $400,000 promissory note to a director with a maturity date of December 12, 2021 (“the director note”). The ~~Company has adopted ASU No. 2016-02,~~ ~~Leases (Topic 842)~~~~, as~~director note did not bear interest however the director received two tranches of ~~January 1, 2019 and will account~~18,750 shares of Common Stock each for ~~their lease in~~lending this amount. Under the terms of the ~~right~~director note if the note was repaid by the maturity date, one of ~~use assets~~the two tranches of 18,750 shares was to be returned. The Company and ~~offsetting lease liability obligations for~~the director extended the maturity date of this ~~new lease under this pronouncement.~~note to June 14, 2022, however the note was not repaid and the company was considered to be in default on the director note. On December 30, 2022, the director, the Company, and Evergreen Capital Management, LLC (“Evergreen”) signed a note purchase agreement (the “Evergreen note purchase”). In accordance with ~~ASC 842 - Leases, effective January 1, 2019,~~ the ~~Company up until May 16, 2019 did not have any long-term lease commitments. On May 17, 2019 with~~Evergreen note purchase, Evergreen purchased the ~~Company’s acquisition~~director note from the director, and the company issued 150,000 shares of ~~TRAQ Pvt Ltd., recorded~~its Common Stock to the director for a ~~lease right of use asset and a lease liability at present~~ value of $~~576,566~~17,555 ~~and $585,207, respectively. The Company is recording this amount at present value, in accordance with~~. Please See Note 13 – Stockholders’ equity (Deficiency). Pursuant to the standard, using an incremental borrowing rate by adjusting the benchmark reference rates with appropriate financing spreads and lease specific adjustments for the effects of collateral. The right of use asset will be composed of the sum of all lease payments plus any initial direct cost and will be straight line amortized over the life of the expected lease term. For the expected term of the leaseEvergreen note purchase the Company ~~will use~~exchanged the ~~term~~director note with Evergreen for a secured convertible promissory note (“Evergreen – 4”) which was issued on December 30, 2022 and has a maturity date of ~~the nine-year lease. This lease will be treated as an operating lease under the standard.~~December 31, 2023.

The Company has chosen to implement this standard using the modified retrospective model approach with a cumulative-effect adjustment, which does not require the Company to adjust the comparative periods presented when transitioning to the new guidance on January 1, 2019. The Company has also elected to utilize the transition related practical expedients permitted by the new standard. The modified retrospective approach provides a method for recording existing leases at adoption and in comparative periods that approximates the results of a modified retrospective approach.
~~In February~~On July 5, 2022, the Company entered into a ~~new lease~~11% OID Senior Secured Promissory Note (the “GS Capital Note”) with GS Capital Partners LLC (“GS Capital”) in the amount of $144,000 (including a ~~right~~$14,000 Original Issue Discount). The GS Capital Note has a term of ~~use asset~~twelve months maturing on July 5, 2023. It accrues interest at a rate of 12% per year. The GS Capital Note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to 86% of the lowest trading price of the Company’s Common Stock for the 12 Trading Days immediately preceding the delivery of a notice of conversion. There are certain price protections, which make the conversion option a derivative liability.
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On February 12, 2021, the Company granted 25,000 warrants (the “Platinum Point Warrants”) that have a term of three-years and ~~lease liability~~an exercise price of $16.00 to Platinum Point Capital, LLC. The warrants granted contain certain price protections, that make the value of the warrants a derivative liability. As a result of a separate issuance of warrants on September 17, 2021, the exercise price of the Platinum Point warrants was reduced to $~~331,154~~11.60.

AsOn March 3, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Keystone – 1”) with Keystone Capital Partners. (“Keystone”) in the amount of ~~September 30,~~$90,000 (including a $15,000 Original Issue Discount). Keystone – 1 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Keystone - 1 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
On March 21, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Keystone – 2”) with Keystone Capital Partners. (“Keystone”) in the amount of $30,000 (including a $5,000 Original Issue Discount). Keystone – 2 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Keystone - 2 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
On March 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Cavalry - 1”) with Cavalry Fund. (“Cavalry”) in the amount of $120,000 (including a $20,000 Original Issue Discount). Cavalry - 1 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Cavalry - 1 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
On February 16, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Cavalry – 2”) with Cavalry Fund. (“Cavalry”) in the amount of $150,000 (including a $30,000 Original Issue Discount). Cavalry – 2 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Cavalry - 2 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
On March 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Cavalry – 3”) with Cavalry Fund. (“Cavalry”) in the amount of $120,000 (including a $20,000 Original Issue Discount). Cavalry – 3 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Cavalry - 3 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
On February 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Eleven 11 – 1”) with Eleven 11 Management LLC. (“Eleven 11”) in the amount of $60,000 (including a $10,000 Original Issue Discount). Eleven 11 – 1 has a maturity date of February 14, 2024. It accrues interest at a rate of 10% per year. Eleven 11 - 1 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price shall be equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
On March 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Eleven 11 – 2”) with Eleven 11 Management LLC. (“Eleven 11”) in the amount of $54,000 (including a $9,000 Original Issue Discount). Eleven 11 – 2 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Eleven 11 - 2 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
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On October 21, 2022, the Company entered into a 20% OID Senior Secured Promissory Note (“Evergreen – 5”) with Evergreen Capital Management, LLC (“Evergreen”) in the amount of $48,000 (including a $8,000 Original Issue Discount). Evergreen - 5 has a maturity of twelve months to July 21, 2023. It accrues interest at a rate of 10% per year. Evergreen - 5 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to 75% of the price per share at which the common stock of the Company is sold to the public in a qualified offering. There are certain price protections, which make the conversion option a derivative liability.
On January 4, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Evergreen – 6”) with Evergreen Capital Management, LLC (“Evergreen”) in the amount of $180,000 (including a $30,000 Original Issue Discount). Evergreen - 6 has a maturity of twelve months ending on January 4, 2024. It accrues interest at a rate of 10% per year. Evergreen - 6 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
On February 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Evergreen – 7”) with Evergreen Capital Management, LLC (“Evergreen”) in the amount of $12,000 (including a $2,000 Original Issue Discount). Evergreen - 7 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Evergreen - 7 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
On February 16, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (the “Chambers Note”) with James D. Chambers Living Trust (“Chambers”) in the amount of $60,000 (including a $10,000 Original Issue Discount). The Chambers Note has a maturity of twelve months ending on February 28, 2024. It accrues interest at a rate of 10% per year. The Chambers Note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability.
Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each warrant is estimated using the ~~unamortized lease right of use asset is $269,235. As of September 30,~~Black-Scholes valuation model. The following assumptions were used in March 31, 2022 ~~the Company’s lease liability was $275,532~~.and December 31, 2021:

SCHEDULE OF ~~REMAINING LEASE OBLIGATION~~VALUATION ASSUMPTIONS
Remaining Lease Obligation at September 30 (undiscounted cash flows)
2023 $ 65,988
2024 52,790
2025 58,333
2026 59,125
2027 59,125
Thereafter 192,256
Total lease payments 487,617
Less: Imputed interest 212,085
Present value of lease liabilities $ 275,532
Three Months Ended
March 31,
2023
Year Ended
December 31,
2022
Expected term 0.87 – 0.05 years 1.00 – 1.00 years
Expected volatility 169.91 – 268.79 % 187.00 – 355.00 %
Expected dividend yield 0.00 – 0.00 % 0.00 – 0.00 %
Risk-free interest rate 3.98 – 4.78 % 1.65 – 4.73 %
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~~For~~The Company’s derivative liabilities are as follows:
SCHEDULE OF DERIVATIVE LIABILITIES

March 31,
2023

December 31,
2022

Fair value of the Evergreen 4 conversion option $ 66,775 $ 58,917
Fair value of the GS Capital conversion option 74,859 157,676
Fair value of the Platinum Point warrants (25,000 warrants) 31,223 -
Fair value of the Keystone 1 conversion option 7,557,012 -
Fair value of the Keystone 2 conversion option 2,506,671 -
Fair value of the Calvary 1 conversion option 10,117,180 -
Fair value of the Calvary 2 conversion option 10,045,935 -
Fair value of the Calvary 3 conversion option 9,999,387 -
Fair value of the Eleven 11 - 1 conversion option 5,061,347 -
Fair value of the Eleven 11 – 2 conversion option 4,520,708 -
Fair value of the Evergreen 5 conversion option 40,928,831 -
Fair value of the Evergreen 6 conversion option 15,352,562 -
Fair value of the Evergreen 7 conversion option 1,012,268 -
Fair value of the Chambers conversion option 5,058,590 -
Derivative liability $ 112,333,348 $ 216,593
Activity related to the ~~nine~~derivative liabilities for the three months ended ~~September 30, 2022 and 2021~~March 31, 2023 is as follows:
SCHEDULE OF ACTIVITY RELATED TO DERIVATIVE LIABILITIES

Beginning balance as of December 31, 2022 $ 216,593
Issuances of warrants/conversion option – derivative liabilities 95,288,462
Extinguishment of derivative liability upon conversion/repayment of convertible notes -
Change in fair value of warrants/conversion option - derivative liabilities 16,828,293
Ending balance as of March 31, 2023 $ 112,333,348
nOTE 16: CONCENTRATIONS
A major customer is defined as a customer that represents 10% or greater of total revenues. The Company does not believe that the risk associated with these customers or vendors will have an adverse effect on the business.
SCHEDULE OF CONCENTRATION RISK
Concentration of Revenues
The Company’s concentration of revenue is as follows:
For the Three Months Ended March 31,
2023 2022

Customer A * - 79 %
Customer B * - 21 %
Customer C 50 % * -
Customer D 19 % * -
Customer E 15 % * -
* Represents amounts less than 10%
Concentration of Accounts Receivable
The Company’s concentration of accounts receivable is as follows:
As of March 31,
2023
As of December 31,
2022
Customer A 50 % * -
Customer B 19 % * -
Customer C 15 % * -
* Represents amounts less than 10%
nOTE 17: CONTINGENCY
During the year ended December 31, 2018, the Company ~~recorded rent expense~~charged an independent truck driver approximately $190,000 pursuant to its agreement with the driver, which entitled the Company to fees equal to $800 per day for the driver’s failure to return a trailer owned by the Company with the period prescribed by the agreement. The Company has not recognized this as income due to uncertainty of $~~31,475~~ ~~and $23,521~~.payment. This contingency was assumed by LR upon transfer of all of the Company’s equity interests in Mimo under the MTP Agreement.
33
~~NOTE 14:~~ ~~DERIVATIVE LIABILITIES~~
~~On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the amount of $125,000. The GS Note has a maturity of~~ ~~one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000~~. ~~The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days~~. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $~~10,000~~ ~~and $5,000~~ ~~was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued~~ ~~3,250~~ ~~shares of common stock as a commitment fee and issued~~ ~~21,250~~ ~~shares of common stock that are returnable upon achievement of the terms of the GS Note (which were returned upon repayment of this note in October 2021). The note was repaid in October 2021.~~
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~~On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”). The Platinum Note has a maturity of~~ ~~one~~~~-year.~~ ~~The conversion price of the Platinum Note is the greater of (a) $0.08 or (b) 70% of the lowest closing stock price over the previous 15 trading days. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted~~ ~~25,000~~ ~~warrants that have a term of three-years and an exercise price of $16.00~~ per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections, that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued ~~7,500~~ ~~shares as a commitment fee. The note was repaid/converted in 2021.~~
~~On September 17, 2021, the Company entered into a 20% OID Senior Secured Promissory Note with Evergreen Capital Management LLC (the “Evergreen 1”) in the amount of $720,000~~ ~~(includes $120,000~~ ~~of Original Issue Discount). The Evergreen 1 has a maturity of nine months to June 17, 2022.~~ ~~The Evergreen 1 accrues interest at a rate of~~ 10~~% per year. The conversion price of Evergreen 1 is the lower of (a) $11.60~~ ~~(“Fixed Conversion Price”) or (b) upon the occurrence and during the continuation of any Event of Default, if lower,~~ 90~~% of the average of the two lowest VWAPs for the five (~~5) consecutive Trading Day that is immediately prior to the applicable Conversion Date (the “Default Conversion Price”). There are certain price protections for Evergreen Capital Management LLC under the terms of Evergreen 1, which make the conversion option a derivative liability. The Company granted ~~62,069~~ ~~warrants that have a term of five-years and an exercise price of $11.60~~ ~~per share with Evergreen 1. The warrants granted with Evergreen 1 also contain certain price protections, that make the value of the warrants a derivative liability.~~
~~On October 8, 2021, the Company entered into a 20% OID Senior Secured Promissory Note in the amount of $480,000~~ ~~(includes $80,000~~ ~~of Original Issue Discount) with Evergreen Capital Management LLC (the “Evergreen 2”). The Evergreen 2 has a maturity of nine months to July 8, 2022.~~ ~~The Evergreen 2 accrues interest at a rate of~~ 10~~% per year. The conversion price of Evergreen 2 is the lower of (a) $11.60~~ ~~(“Fixed Conversion Price”) or (b) upon the occurrence and during the continuation of any Event of Default, if lower,~~ 90~~% of the average of the two lowest VWAPs for the five (~~5) consecutive Trading Day that is immediately prior to the applicable Conversion Date (the “Default Conversion Price”). There are certain price protections for Evergreen Capital Management LLC under the terms of Evergreen 2, which make the conversion option a derivative liability. The Company granted ~~41,379~~ ~~warrants that have a term of five-years and an exercise price of $11.60~~ ~~per share with Evergreen 2. The warrants granted with Evergreen 2 also contain certain price protections, that make the value of the warrants a derivative liability.~~
~~On October 15, 2021, the Company entered into a 20% OID Senior Secured Promissory Note in the amount of $240,000~~ ~~(includes $40,000~~ ~~of Original Issue Discount) with Evergreen Capital Management LLC (the “Evergreen 3”). The Evergreen 3 has a maturity of nine months to July 15, 2022.~~ ~~The Evergreen 3 accrues interest at a rate of~~ 10~~% per year. The conversion price of Evergreen 3 is the lower of (a) $11.60~~ ~~(“Fixed Conversion Price”) or (b) upon the occurrence and during the continuation of any Event of Default, if lower,~~ 90~~% of the average of the two lowest VWAPs for the five (~~5) consecutive Trading Day that is immediately prior to the applicable Conversion Date (the “Default Conversion Price”). There are certain price protections for Evergreen Capital Management LLC under the terms of Evergreen 3, which make the conversion option a derivative liability. The Company granted ~~20,690~~ ~~warrants that have a term of five-years and an exercise price of $11.60~~ ~~per share with Evergreen 3. The warrants granted with Evergreen 3 also contain certain price protections, that make the value of the warrants a derivative liability.~~
~~On July 5, 2022, the Company entered into a 11% OID Senior Secured Promissory Note with GS Capital Partners LLC (the “GS Capital”) in the amount of $144,000~~ ~~(includes $14,000~~ ~~of Original Issue Discount). The GS Capital has a maturity of twelve months to July 5, 2023. It accrues interest at a rate of~~ 12~~% per year. The conversion price Subject to the adjustments described herein, the conversion price (the “Conversion Price”) shall be equal to~~ 86~~% of the lowest trading price of the Company’s Common Stock for the~~ 12 ~~Trading Days immediately preceding the delivery of a notice of conversion. There are certain price protections, which make the conversion option a derivative liability.~~
Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each warrant is estimated using the Black-Scholes valuation model. The following assumptions were used in September 30, 2022 and December 31, 2021:
~~SCHEDULE OF VALUATION ASSUMPTIONS~~
~~Nine Months Ended~~
September 30,
2022
Year Ended
December 31,
2021
~~Expected term~~ 1 ~~year~~ 1 ~~year~~
~~Expected volatility~~ ~~187~~ - ~~260~~ % ~~164~~ – ~~269~~ %
~~Expected dividend yield~~ - -
~~Risk-free interest rate~~ ~~1.65~~ – ~~4.25~~ % ~~0.15~~ %
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~~The Company’s derivative liabilities are as follows:~~
~~SCHEDULE OF DERIVATIVE LIABILITIES~~

September 30,
2022

December 31,
2021

Fair value of the Platinum Point warrants (25,000 warrants) $ 12,250 $ 90,000
Fair value of the Evergreen 1 conversion option 805,261 223,448
Fair value of the Evergreen 1 warrants (62,069 warrants) 70,759 307,862
Fair value of the Evergreen 2 conversion option 530,360 148,965
Fair value of the Evergreen 2 warrants (41,379 warrants) 47,173 205,241
Fair value of the Evergreen 3 conversion option 264,100 74,483
Fair value of the Evergreen 3 warrants (20,690 warrants) 23,586 102,621
Fair value of the GS Capital conversion option 199,787 -
Derivative liability $ 1,953,276 $ 1,152,620
~~Activity related to the derivative liabilities for the nine months ended September 30, 2022 is as follows:~~
~~SCHEDULE OF ACTIVITY RELATED TO DERIVATIVE LIABILITIES~~
Beginning balance as of December 31, 2021 $ 1,152,620
Issuances of warrants/conversion option – derivative liabilities 165,924
Extinguishment of derivative liability upon conversion/repayment of convertible notes (- )
Change in fair value of warrants/conversion option - derivative liabilities 634,732
Ending balance as of September 30, 2022 $ 1,953,276
~~There were no derivative liabilities prior to January 2021.~~

nOTE ~~15:~~18: ~~CONCENTRATIONS~~COMMITMENTS AND CONTINGENCIES

~~During the nine months ended September 30, 2022 and 2021, the Company had two major customers comprising~~ 6~~7% of revenues and two major customers comprising~~ 57~~% of revenues, respectively. A major customer is defined as a customer that represents 10% or greater of total revenues. There was~~ 66~~% and~~ 93~~% of accounts receivable representing three and five customers as of September 30, 2022 and December 31, 2021, respectively.~~

The ~~Company does not believe that the risk associated with these customers or vendors will have an adverse effect on the business.~~
~~nOTE 16:~~ ~~CONTINGENCY~~
~~During the year ended December 31, 2018, the Company charged an independent truck driver approximately $190,000~~ ~~pursuant to its agreement with the driver, which entitled the Company to fees equal to $800~~ ~~per day for the driver’s failure to return a trailer owned by the Company with the period prescribed by the agreement. The Company has not recognized this as income due to uncertainty of payment~~below commitments and ~~will record as other income during the period in which amounts~~contingencies are ~~collected.~~
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~~nOTE 17:~~ ~~COMMITMENTS AND CONTINGENCIES~~
~~Commitments and contingencies~~ in respect of TRAQ Pvt ~~Ltd;~~Ltd., and following the transfer of all of the Company’s equity interests in TRAQ Pvt Ltd., to LR under the TSP Agreement, the commitments and contingencies were assumed by LR;

(i) TRAQ Pvt Ltd had applied for compounding of the TDS liability for the assessment year 2014-2015 and 2015-2016 in accordance with Indian Income Tax Laws. However, no amount payable for tax and penalty was confirmed by the Income Tax Department. Further, TRAQ Pvt Ltd has also defaulted for TDS deducted but not paid in time during assessment years 2016-2017 to 2020-2021. Accordingly, there may be a contingent liability in respect of TDS regarding compounding charges, interest, and penalty which is not quantifiable at present, and therefor no effect is given in the Consolidated Financial Statements.
(ii) TRAQ Pvt Ltd ~~has outstanding Gratuity for $9,462~~ as of December 31, 2021, towards ex-employees of TRAQ Pvt Ltd; therefore, TRAQ Pvt Ltd is liable for penalty under The Gratuity Act under the Indian Laws and other relevant laws. Since the amount of penalty for default in payment of gratuity is not ascertainable, therefore it is not provided for in the Consolidated Financial Statements.
~~(iii)~~ ~~TRAQ Pvt Ltd has~~was delayed in complying with provisions related to Foreign Direct Investment and Transfer of Shares to Non-resident as per the Master Circulars and notification issued by Reserve Bank of India, therefore, and is therefor liable for imposition of a penalty. Since the amount of the penalty ~~for the same~~ is not ascertainable, no effect was given in the Consolidated Financial Statements.
~~(iv)~~(iii) Prior to its acquisition in May 2019, TRAQ Pvt Ltd, had provided a guarantee in favor of State Bank of India for ~~$165,813~~$165,813 on March 22, 2014, for Mira Green Tech Private Limited. ~~The~~As of the execution of the TSP Agreement and the transfer of the Company’s entire equity interests in TRAQ Pvt Ltd, to LR, the State Bank of India iswas in process of satisfying whether there iswas any obligation due by TRAQ Pvt ~~Ltd at this time.~~Ltd.

~~(v)~~(iv) TRAQ Pvt Ltd has a contingent liability of $246,398 towards income tax department for Assessment year 2018-19, However an appeal ~~is already~~was filed against such demand in the income tax department and proceeding is still pending; Accordingly, there may be a contingent liability in respect of Income Tax of such demand amount, interest, and ~~penalty which is~~penalty. As of the execution of the TSP Agreement and the transfer of the Company’s entire equity interests in TRAQ Pvt Ltd, to LR, this contingent liability was not quantifiable, ~~at present, hence not provided in the Consolidated Financial Statements.~~
~~The Traq Pvt Ltd has defaulted in making the payment towards statutory liability is respect Provident fund~~ and ~~TDS, The total outstanding amount as on September 30, 2022 is Approximately $36,268~~ ~~& $12,653, which is pertaining to financial year 2019-2020 to 2022-2023 However no amount for penalty and interest damages confirmed by the respective departments~~
~~Commitments and contingencies in respect of Mimo Technologies Pvt Ltd;~~
~~(i)~~ ~~During the year, Mimo Technologies Pvt. Ltd. has received funds from TraQiQ Inc, a US company amounting to approximately $611,128~~ which is outstanding as at September 30, 2022, RBI regulates the foreign funds and based on the purpose of the transactions, compliances as per the RBI regulation needs to be complied with, Mimo was delayed in their reporting with the Master Circulars and received notification by the Reserve Bank of India, and therefore, is liable for the imposition of penalties. Since the amount of the penalty for the same is not ascertainable,therefor no effect was given in the Consolidated Financial Statements.
The below commitments and contingencies are in respect of Mimo Technologies Pvt Ltd., and following the transfer of all of the Company’s equity interests in Mimo to LR under the MTP Agreement, the commitments and contingencies were assumed by LR;
(i)
~~(ii)~~ As of the execution of the MTP Agreement and the transfer of the Company’s entire equity interests in Mimo to LR, Mimo Technologies Pvt Ltd ~~has~~was delayed in complying with provisions related to Foreign Direct Investment and Transfer of Shares to Non-resident as per the Master Circulars and notification issued by Reserve Bank of India, and therefore, is liable for imposition of a penalty. Since the amount of the penalty for the same is not ascertainable, no effect was given in the Consolidated Financial Statements.
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nOTE 19: SUBSEQUENT EVENTS
On April 19, 2023 the Company agreed to settle its outstanding debt owed under the Celtic Note. The settlement agreement reduced the liability owed by the Company to two payments of $20,000. The first payment was due by April 28, 2023 and has been paid by the company. The second payment is due by May 31, 2023.
On April 28, 2023 the Company agreed to settle its outstanding debt owed under the Forward Finance future sales receipt agreement. The settlement agreement reduced the liability owed by the Company to two payments of $10,950. The first payment was due by May 5, 2023 and has been paid by the company. The second payment is due by May 31, 2023.
On April 1, 2023, the Company entered into a 20% OID Senior Secured Promissory Note with Keystone Capital Partners. (“Keystone”) in the amount of $132,000 (including a $22,000 Original Issue Discount). The note has a maturity date of March 31, 2024. It accrues interest at a rate of 10% per year. The note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average prices of the five trading days ending on the day immediately prior to the conversion date.
On April 18, 2023, the Company entered into a 20% OID Senior Secured Promissory Note with Keystone Capital Partners. (“Keystone”) in the amount of $60,000 (including a $10,000 Original Issue Discount). The note has a maturity date of April 17, 2024. It accrues interest at a rate of 10% per year. The note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average prices of the five trading days ending on the day immediately prior to the conversion date.
On April 26, 2023, the Company entered into a 20% OID Senior Secured Promissory Note with Keystone Capital Partners. (“Keystone”) in the amount of $108,000 (including a $18,000 Original Issue Discount). The note has a maturity date of April 30, 2024. It accrues interest at a rate of 10% per year. The note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average prices of the five trading days ending on the day immediately prior to the conversion date.
On April 1, 2023, the Company entered into a 20% OID Senior Secured Promissory Note with Cavalry Fund I LP. (“Cavalry”) in the amount of $120,000 (including a $20,000 Original Issue Discount). The note has a maturity date of March 31, 2024. It accrues interest at a rate of 10% per year. The note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average prices of the five trading days ending on the day immediately prior to the conversion date.
On April 26, 2023, the Company entered into a 20% OID Senior Secured Promissory Note with Cavalry Fund I LP. (“Cavalry”) in the amount of $90,000 (including a $18,000 Original Issue Discount). The note has a maturity date of April 30, 2024. It accrues interest at a rate of 10% per year. The note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average prices of the five trading days ending on the day immediately prior to the conversion date.
On April 5, 2023, the Company entered into a 20% OID Senior Secured Promissory Note with Evergreen Capital Management LLC. in the amount of $54,000 (including a $9,000 Original Issue Discount). The note has a maturity date of March 31, 2024. It accrues interest at a rate of 10% per year. The note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date.
On April 26, 2023, the Company entered into a 20% OID Senior Secured Promissory Note with Evergreen Capital Management LLC. in the amount of $108,000 (including a $18,000 Original Issue Discount). The note has a maturity date of April 30, 2024. It accrues interest at a rate of 10% per year. The note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date.
On April 17, 2023, the Company entered into a 20% OID Senior Secured Promissory Note with Seven Knots LLC. in the amount of $60,000 (including a $10,000 Original Issue Discount). The note has a maturity date of April 16, 2024. It accrues interest at a rate of 10% per year. The note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date.
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~~(iii)~~
~~The Mimo Technologies Pvt Ltd has defaulted in making the payment towards statutory liability is respect Provident fund and TDS, The total outstanding amount as on September 30, 2022 is Approximately $13,636~~ ~~& $40,675, which is pertaining to financial year 2019-2020 to 2022-2023 However no amount for penalty and interest damages confirmed by the respective departments~~

~~nOTE 17:~~ ~~SUBSEQUENT EVENTS~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported revenues and expenses during the reporting periods. On an ongoing basis, we evaluate estimates and judgments, including those described in greater detail below. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
As used in this “Management’s Discussion and Analysis of Financial Condition and Results of Operation,” except where the context otherwise requires, the term “we,” “us,” “our,” or “the Company,” refers to the business of TraqIQ Inc.
The following presentation of management’s discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements, the accompanying notes thereto and other financial information appearing elsewhere in this quarterly report on Form 10-Q. This section and other parts of this quarterly report on Form 10-Q contain forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements.”
Overview of the Company

Our mission is to reduce the environmental impact of the waste management industry through the development and deployment of cost-effective technology solutions. Our suite of technologies includes on-site biological processing equipment for food waste and proprietary real-time data analytics tools to reduce food waste generation. These proprietary solutions may enable certain businesses and municipalities of all sizes to lower disposal costs while having a positive impact on the environment. When used individually or in combination, we believe that our solutions can reduce the carbon footprint associated with waste transportation, repurpose non-recyclable plastics, and significantly reduce landfill usage. As we continue to expand our waste management business we plan to discontinue or spin off the remaining portions of the legacy business.
The Company currently markets an aerobic digestion technology solution for the disposal of food waste at the point of generation. Its line of Revolution Series Digesters has been described as self-contained, robotic digestive systems that we believe are as easy to install as a standard dishwasher with no special electrical or plumbing requirements. Units range in size depending upon capacity, with the smallest unit approximately the size of a residential washing machine. The digesters utilize a biological process to convert food waste into a liquid that we believe is safe to discharge down an ordinary drain. This process can result in a substantial reduction in costs for customers including cruise lines, restaurants, retail stores, hospitals, hotel/hospitality companies and governmental units by eliminating the transportation and logistics costs associated with food waste disposal. The Company also expects the process reduce the greenhouse gases associated with food-waste transportation and decomposition in landfills that have been linked to climate change. The Company offers its Revolution Series Digesters in several sizes targeting small- to mid-sized food waste generation sites that are often more economical than traditional disposal methods. The Revolution Series Digesters are manufactured and assembled in the United States.
In an effort to expand the capabilities of its digesters, the Company developed a sophisticated Internet of Things (“IoT”) technology platform to provide its customers with transparency into their internal and supply chain waste generation and operational practices. This patented process collects weight related data from the digesters to deliver real-time data that provides valuable information that when analyzed, can improve efficiency, and validate corporate sustainability efforts. The Company provides its IoT platform through a SaaS (“Software as a Service”) model that is either bundled in its rental agreements or sold through a separate annual software license. The Company continues to add new capacity sizes to its line of Revolution Series Digesters to meet customer needs.
Legacy Business
TraQiQ Solutions Private Limited

On ~~October 3, 2022, we implemented~~May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation (“Mann”). On January 2, 2020, Mann changed its name to TraQiQ Solutions Private Limited (“TRAQ Pvt Ltd”). Pursuant to the Share Exchange Agreement with Mann, the Company acquired 100% of the shares of Mann and assumed certain ~~leadership changes~~net liabilities in exchange for warrants exercisable over a five-years to ~~further our efforts~~purchase 166,159 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 12,596 warrants immediately; (ii) 107,494 warrants exercisable one-year after the date of closing, which was extended to ~~move forward~~March 31, 2021; and (iii) 46,069 warrants exercisable two-years after the date of closing. This transaction is being recorded as a business combination under ASC 805. There were 56,400 of these warrants exercised during 2021 and 57,368 warrants remain outstanding as of March 31, 2022.
The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately. A total of 52,391 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.
Mann-India Private limited was renamed to TraQiQ Solutions Private Limited shortly after acquisition by TraQiQ Inc.
TRAQ Pvt Ltd. was established in May 2000 and is headquartered in New Delhi, India. TRAQ Pvt Ltd. is a leading software development company which, with the ~~change~~advent of technology, has evolved as a mature and fast-growing company committed to provide reliable and cost-effective software solutions across industries all over the world.
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TRAQ Pvt Ltd. has its own experienced team of software developers dedicated towards developing various kinds of customized software.
TraQ Pvt Ltd. has been doing business around the world for over 15 years, with particular emphasis on Latin America and India. The customer list includes large enterprise Finance and Insurance companies across Latin America. The company’s product portfolio has evolved rapidly and now includes enterprise ready solutions for payment processing, mobile wallets, micro lending solutions and digital transformation.
On December 30, 2022, the Company entered into an Assignment of Stock (the “TSP Agreement”) with TraQiQ Solutions Private Ltd. (“TSP”) and LR, pursuant to which the Company sold, assigned and transferred to LR and LR purchased from the Company, all of the equity interests in ~~our~~TSP in exchange for nominal consideration of $1.00.
Rohuma, LLC
On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuma members agreed to exchange all of their respective membership interests in Rohuma in exchange for 536,528 shares of common stock, of which the first tranche of shares were issued on March 1, 2021 totaling 320,285 shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $3,433,776 ($6.40 per share). The Company as of March 31, 2022, determined that the second tranche of shares (134,132) met the criteria to be issued, and the value of $858,445 was reclassified from contingent consideration to Obligation to Issue Common Stock. Rohuma has an Indian affiliate that is owned 99% by Rohuma and 1% by its founding member. Rohuma controls this entity and the 1% ownership by the member is now less than 1% upon acquisition by the Company. This amount is reflected as a non-controlling interest.
Rohuma dba Kringle.ai was a California based software solutions company that enabled digital and mobile commerce by providing enterprise class applications that cover loyalty and rewards products, payments, online ordering, distribution logistics for retail and more. Kringle analyzed customers’ omni-channel behaviors and transactions. Using AI for digital commerce, Kringle was able to deliver real time, automated 1:1 recommendations and personalized content across all customer touch points.
On December 30, 2022, the Company entered into an Assignment of Units (the “Rohuma Agreement”, and, together with the MTP Agreement and the TSP Agreement, the “Disposition Agreements”) with Rohuma LLC (“Rohuma”) and Happy Kompany LLC (“Happy”) pursuant to which the Company sold, assigned and transferred to Happy, and Happy purchased from the Company, all of the equity interests in Rohuma in exchange for nominal consideration of $1.00. Pursuant to the Rohuma Agreement, the Company assumed the liabilities of Rohuma with respect to two loans with Paypal/Loanbuilder in an aggregate principal amount of $155,053 plus any accumulated interest and fees.
Mimo Technologies Private Limited
On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 170,942 shares of the Company’s common stock. Of these warrants, 102,565 were earned at the date of acquisition, with the remaining 68,377 expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.008 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. The Company as of March 31, 2022, determined that the criteria for vesting of the second tranche of warrants was satisfied and reclassified $410,112 from contingent consideration to additional paid in capital. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.
TraQiQ operated the Mimo delivery and task service in India. This service ran on the TraQSuite platform. Mimo had 14,000+ independent contractors across India performing deliveries and fulfilling tasks for the largest corporations in the country. Our team at Mimo used a sophisticated technology platform and a smartphone app to get their tasks completed. This was coupled with a verification and billing system that allowed customers of all sizes to leverage this distribution infrastructure.
Mimo offered a broad set of services. These offerings could be classified into three broad categories:
● Data collection and client verification (surveys, verification, on-boarding),
● Cash management & handling services, and
● Distribution and demand generation (order fulfilment, demand generation, delivery services for e-commerce companies)
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Mimo assisted the delivery and pickup segment of the banking and insurance industry by performing verifications, field investigations for loan requests, business ~~plan~~verifications and ~~accepted~~employment verification, and also collected documents, assisted in filling forms for banks, and completed data collection from customers.
Mimo worked with microfinance institutions to collect cash, such as loan payments, convert cash to digital means like debit cards, and conduct data collection and surveys.
For consumer goods companies, Mimo did promotional marketing, Last mile (hyper-local) delivery, merchant onboarding or activation, store audits, and route optimization for delivery. Mimo provided efficient end-to-end transshipment logistics. The framework managed and optimized last-mile delivery & e-commerce logistics across the ~~resignation~~entire distribution chain with transparency and seamless integration.
During the COVID-19 pandemic, Mimo leveraged video as a platform for verification and document delivery.
There were also data digitization tasks being done by Mimo task workers across the country. In a country like India where there are over 20 languages and multiple dialects, the task workers converted paper documents into electronic form in the same language or translated them into another language.
Mimo provided delivery and task worker solutions across India. Mimo works with Banking, Financial, Logistics and Distribution companies, to take their products and services to semi-urban and rural India. Mimo trained the agents in each Product or Service through an online and classroom training platform. The company powered the gig economy task workers throughout the country and provided a very valuable source of ~~Michael Pollack, our Interim Chief Financial officer. Effective October 3,~~employment for young people who may or may not have a high school diploma.

On December 30, 2022, ~~upon~~ the ~~resignation~~Company entered into an Assignment of ~~Mr. Pollack,~~Stock (the “MTP Agreement”) with Mimo Technologies Private Ltd. (“MTP”) and Lathika Regunathan (“LR”), pursuant to which the ~~Board appointed Ajay Sikka, our Chairman~~Company sold, assigned and ~~CEO,~~transferred to LR, and LR purchased from the Company, all of the Company’s equity interests in MTP in exchange for nominal consideration of $1.00.
TraQSuite is a cloud based software platform with a revenue model based on initial and transaction-based licensing fees as ~~CFO.~~ well as consulting fees. Licensees pay an initial per-module fee that varies depending on the number of modules that are licensed.
The Company’s TraQSuite software platform powers the last mile distribution network, allowing business users to target customers, facilitate and validate transactions, track and manage task workers, manage funds and run a distribution network. Key features of the TraQSuite software include:
● Last Mile delivery: TraQSuite’s Last-Mile software module enables a business to manage thousands of task workers across multiple geographies to deliver products and services to the users. The software platform, operating through mobile apps, allows for data sharing, delivery validation, geo-tagging and know-your-customer (KYC) requirements and can even measure customer satisfaction.
● Transact: TraQSuite enables task workers to facilitate transactions by meeting the end customers. They can collect payments via credit cards, smart-phone swipes, SMS messages or cash. Both banked and unbanked users can buy products and services and pay with their mobile devices.
● Target: TraQSuite enables customer transactions to be rewarded with loyalty credits, tokens or points that can be redeemed by the customer for free products, discounts and benefits. The software analyzes these transactions and purchase behaviors by using leading AI models and can deliver real time, automated and targeted offers and recommendations for additional purchases and customer retention.
The Mimo delivery and task service in India runs on the TraQSuite platform and performs deliveries and fulfills tasks for some of the largest businesses in India. Mimo provides delivery and pickup services for the banking and insurance industry, performing verifications, field investigations for loan requests, business verification, employment verification, collection of documents and customer data and assistance in filling out forms for banks. Mimo works with microfinance institutions to collect cash, such as loan payments, convert cash to digital forms such as debit cards, and conduct data collection and surveys. For consumer goods companies, Mimo does promotional marketing, last mile (hyper-local) delivery, merchant onboarding or activation, store audits, and route optimization for delivery.

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Continuing Operations
Recoup Technologies, Inc.
Recoup Technologies, Inc. provides cutting-edge solutions based on patented technologies, to measure, analyze and manage the waste management process. Recoup’s products divert food waste from landfill, reduce costs, improve operations, and minimize negative environmental impact for organizations across the world. The company offers Products (Digestors) that convert food waste into grey water discharge that is safe to enter sewage systems. The company also provides accurate real-time information to eliminate the uncertainty about where food waste occurs, how much is being wasted and its associated value. A waste tracking process forecasts accurate supply chain and inventory needs, standardizes best practices for production, and improves future planning for the prevention of waste.
TraQiQ Solutions, Inc.
Ci2i was a services company founded in 1998 that developed and deployed intelligent technologies and products in order to meet the demand for sustainable, integrated solutions. Ci2i’s primary focus has been in the analytics and intelligence segments. The Company was investing significantly in building products in the area of supply chain and last mile delivery.
Ci2i’s cloud solutions and analytics services comprised software development, program management, project management, and business analytics services.
Going Concern
The Company has an accumulated deficit of $129,484,933 as of March 31, 2023 and a working capital deficit of $116,987,178, as of March 31, 2023, and a working capital deficit of $1,682,659 as of December 31, 2022. As a result of these factors, management has determined that there is substantial doubt about the Company ability to continue as a going concern.
The consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties. The Company’s continuation as a going concern is contingent upon its ability to obtain additional financing and generate revenue and cash flow to meet its obligations on a timely basis. Management intends to seek additional funding through debt or equity financing during the next twelve months to source new inventory and generate revenue from product sales.
Discontinued Operations
As discussed in the consolidated financial statements, the Company sold Rohuma, Mimo and TSP in December of 2022. Additionally, the Company is shifting operations to waste management. As such, these businesses are reported as discontinued operations for the three months ended March 31, 2022. As required, the Company has retrospectively recast its consolidated statements of operations and balance sheets for the consolidated financial statements.
The retrospective recast of the company’s income statement and balance sheet for the quarter ended March 31, 2022 resulted in a loss on discontinued operations of $6,866,913 for the three months ended March 31, 2022. The Company has not segregated the cash flows of this business in the consolidated statements of cash flows. Management was also required to make certain assumptions and apply judgment to determine historical expenses related to the discontinued operations presented in prior periods. Unless noted otherwise, this discussion and analysis of our financial condition and results of operations refers to the Company’s continuing operations.
The following table presents a reconciliation of the major financial lines constituting the results of operations for discontinued operations to the net income (loss) from discontinued operations presented separately in the consolidated statement of operations for the three months ended March 31, 2022:
Rohuma Mimo TSP Total
March 31, 2022 March 31, 2022 March 31, 2022 March 31, 2022

REVENUE $ 48,085 $ 64,652 $ 234,189 $ 346,886
COST OF REVENUE 79,065 145,960 135,687 360,712
GROSS PROFIT (LOSS) (31,020 ) (81,308 ) 98,502 (13,826 )

OPERATING EXPENSES
Salaries and salary related costs 104,263 - 17,556 121,819
Professional fees 4,617 18,621 3,190 26,428
Rent expense 442 - 755 1,197
Depreciation and amortization expense - 11,644 2,145 14,840
General and administrative expenses 4,502 5,809 17,385 27,696

Total Operating Expenses 114,875 36,074 41,031 191,980

OPERATING (LOSS) INCOME (145,895 ) (117,382 ) 57,471 (205,806 )

OTHER INCOME (EXPENSE)
Loss from impairment of intangible assets - (776,263 ) - (776,263 )
Loss from impairment of goodwill (3,519,869 ) (2,343,188 ) - (5,863,057 )
Interest expense, net of interest income (2,126 ) (2,509 ) (14,280 ) (18,915 )
Other income 154 45 2,608 2,807
Total other income (expense) (3,521,841 ) (3,121,915 ) (11,672 ) (6,655,428 )

LOSS FROM DISTCONTINUED OPERATIONS, BEFORE PROVISION FOR INCOME TAXES (3,667,736 ) (3,239,297 ) 45,799 (6,861,234 )
Provision for income taxes – discontinued operations 367 - 5,312 5,679
LOSS INCOME FROM DISTCONTINUED OPERATIONS $ (3,668,103 ) $ (3,239,297 ) $ 40,487 $ (6,866,913 )
The following table presents a reconciliation of Rohuma, Mimo, and TSP net cash flows from operating, investing and financing activities for the periods indicated below:
March 31, 2022
Net cash (used in) provided by operating activities - discontinued operations $ 409,295
Net cash (used in) provided by investing activities - discontinued operations $ -
Net cash provided by (used in) financing activities - discontinued operations $ (468,293 )
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Acquisition of Recoup Technologies, Inc.
On January 5, 2023, pursuant to an asset purchase agreement, dated December 30, 2022, we completed the acquisition of all of the Digester business assets of Recoup Technologies, Inc. (“Recoup” or the “Digester business”) for a purchase price of $18,371,421 consisting of the following:
Type of Consideration Number of Shares Fair Value
Cash $ 150,000
Issuance of common stock a. 15,686,926 $ 1,592,318
Issuance of series – B preferred stock b. 1,250,000 $ 12,688,256
Liabilities assumed:
Michaelson Capital Senior Note c. $ 3,017,090
Accounts Payable and accrued expenses $ 612,213
Contract liabilities $ 311,544
Total consideration $ 18,371,421
a. This transaction was exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended
b. This transaction was exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended
c. Please see Note 12 – Notes Payable
The acquisition of Recoup was accounted for as a business combination in accordance with the acquisition method under the guidance in ASC 805-10 and 805-20. Accordingly, the total purchase consideration was allocated to intangible assets acquired based on their respective estimated fair values. The acquisition method of accounting requires, among other things, that assets acquired, and liabilities assumed, if any, in a business purchase combination be recognized at their fair values as of the acquisition date. The process for estimating the fair values of identifiable intangible assets and certain tangible assets requires the use of significant estimates and assumptions, including estimating future cash flows, developing appropriate discount rates, estimating the costs, and timing.
The allocation of the purchase price in connection with the acquisition of Recoup was calculated as follows:
Description Fair Value
Weighted Average
Useful Life
(Years)

Fixed assets – truck $ 1,196 7
Inventory 379,718
Intellectual property 10,333,144 10
Tradenames 285,863 10
Noncompete agreement 78,615 5
Goodwill 7,292,885 Indefinite
$ 18,371,421
Goodwill of $7,292,885 arising from the acquisition of Recoup consisted of new customer relationships for the Company, access to new product market opportunities, expected growth opportunities, and the residual value after all identifiable intangible assets were valued. Total acquisition costs for the acquisition of Recoup incurred were $86,116 recorded as a component of General and administrative expenses.
The approximate revenue and gross profit for the acquired business as a standalone entity per ASC 805 from January 5, 2023 to March 31, 2023 was $64,611 and $29,158, respectively.
Results of Operations
Results of Operations and Financial Condition for the Three Months Ended March 31, 2023 as Compared to the Three Months Ended March 31, 2022
Revenue
For the three months ended March 31, 2023 compared to March 31, 2022, the Company’s revenues increased by $53,209, from $522 in Q1 2022 to $65,040 in Q1 2023. The increase is the result of the acquisition of Recoup on January 5, 2023, and the resulting revenue generated by Recoup.
Cost of Revenue
For the three months ended March 31, 2023 compared to March 31, 2022, the Company’s cost of revenue increased by $25,800, or 226%, from $11,416 in Q1 2022 to $37,216 in Q1 2023. The increase is due to the increased revenue caused by the implementation of the Recoup acquisition.
Operating Expenses
For the three months ended March 31, 2023 compared to March 31, 2022, the Company’s salary and salary related costs increased by $70,514, or 71%, from $100,016 to $170,530. The increase was due to the personnel costs associated with implementation of the Recoup acquisition.
For the three months ended March 31, 2023 compared to March 31, 2022, the Company’s professional fees decreased by $56,100, or 64%, from $88,051 to $31,951. The decrease can be attributed primarily to consulting fees incurred during 2022 in preparation for the disposal of the Company’s subsidiaries and acquisition.
For the three months ended March 31, 2023 compared to March 31, 2022, the Company’s depreciation and amortization expense increased by $409,788, from $0 to $409,788. The increase was primarily the result of the acquisition of Recoup’s intangible assets and the associated amortization of the intangibles.
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For the three months ended March 31, 2023 compared to March 31, 2022, the Company’s general and administrative expenses increased by $84,933, or 311%, from $27,309 to $112,242. The increase was primarily due to increased insurance expenses and bad debt expense of $52,110.
Interest Expense
For the three months ended March 31, 2023 compared to March 31, 2022, the Company’s interest expense decreased by $307,618, or 66%, from $464,180 to $156,562. The decrease was due mainly to a decrease in debt instruments accruing interest on the Company’s Balance sheet.
Changes in Fair Value of Derivative Liabilities
For the three months ended March 31, 2023 compared to March 31, 2022, the Company’s change in the fair value of the derivative liability increased by $16,828,293, from $0 in Q1 2022 to an expense of $16,828,293 in Q1 2023 due to changes in the volatility of the Company’s share price over the period March 31, 2023 compared to March 31, 2022.
Net Loss from Continuing Operations
For the three months ended March 31, 2023 compared to March 31, 2022, the Company’s net loss from continuing operations increased by $111,173,161 from $691,060 in Q1 2022 to $111,864,221 in Q1 2023 due to the changes noted herein.
Liquidity and Capital Resources
As of March 31, 2023, current assets were $576,312 and current liabilities outstanding amounted to $117,465,564 which resulted in a working capital deficit of $116,889,252. As of December 31, 2022, current assets were $66,460 and current liabilities outstanding amounted to $1,682,659 which resulted in a working capital deficit of $1,682,659.
Net cash used in operating activities was $192,445 for the three months ended March 31, 2023 compared to $399,388 for the three months ended March 31, 2022. Cash used in operations for the three months ended March 31, 2023, was primarily due to a net loss of $111,864,221, and an increase in accounts receivable of $117,979; offset by a change in the fair value of the derivative liability and derivative expense of $111,011,754, depreciation and amortization expense of $250,994, amortization of discounts and convertible options on debt of $158,794, an increase in accounts payable, accrued expenses, and deferred taxes of $93,957, and an increase in accrued payroll and payroll taxes of $94,529.
Net cash used in operations for the three months ended March 31, 2022 was primarily due to a net loss of $917,348; offset mainly by amortization of discounts and convertible options on debt of $292,777, an increase in accounts payable, accrued expenses and deferred taxes of $84,422, stock-based compensation of $51,431, and a decrease in accounts receivable of $45,052.
Cash flows used for investing activities for the three months ended March 31, 2022, was limited to the $25,574 acquisition of fixed assets related to the Company’s Indian subsidiaries, which were disposed of in December of 2022 and are considered discontinued operations. Cash flows used in investing activities for the three months ended March 31, 2023 was limited to the cash consideration paid for the acquisition of Recoup of $150,000.
During the three months ended March 31, 2023, the cash flows from financing activities consisted of convertible note proceeds of $705,000; offset by payments on notes payable of $163,814 and payments for convertible notes of $60,480. Net cash provided by financing activities for the three months ended March 31, 2022 consisted of proceeds received from long-term debt of $344,652, and proceeds received from related party notes of $205,836. These cash flows were offset by repayments of $63,973 in related party notes and $58,615 in long-term debt during the three months ended March 31, 2022. In addition, for the three months ended March 31, 2022 there was an increase in the cash overdraft of $48,400.
The company had $986 and $7,991 of cash payments for interest expense for the three months ended March 31, 2023 and 2022, respectively. As well as $0 and $5,679 of cash payments for income taxes for the three months ended March 31, 2023 and 2022, respectively.
Off-Balance Sheet Arrangements
We have no off-balance sheet financing arrangements.
~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations~~
The discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, as well as the reported revenues and expenses during the reporting periods. On an ongoing basis, we evaluate estimates and judgments, including those described in greater detail below. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
As used in this “Management’s Discussion and Analysis of Financial Condition and Results of Operation,” except where the context otherwise requires, the term “we,” “us,” “our,” or “the Company,” refers to the business of TraqIQ Inc.
The following presentation of management’s discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements, the accompanying notes thereto and other financial information appearing elsewhere in this quarterly report on Form 10-Q. This section and other parts of this quarterly report on Form 10-Q contain forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements.”
~~Overview~~
TraQiQ, Inc. (along with its wholly owned subsidiaries, referred to herein as the “Company”) was incorporated in the State of California on September 9, 2009 as Thunderclap Entertainment, Inc. On July 14, 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc. On July 19, 2017, the Company entered into a Share Exchange Agreement (“Share Exchange”) with the stockholders of OmniM2M, Inc. (“OmniM2M”) and TraQiQ Solutions, Inc. dba Ci2i Services, Inc. (formerly Ci2i Services, Inc. – amended November 6, 2019) (“Ci2i”) whereby the stockholders of Omni and Ci2i exchanged all of their respective shares, representing 100% ownership in OmniM2M and Ci2i in exchange for 1,500,000 shares of the Company’s common stock, respectively. The OmniM2M Shareholders and the Ci2i Shareholders have each been issued their respective 1,500,000 shares on a pro rata basis based on their respective holdings in OmniM2M and Ci2i in the Share Exchange Agreement. The Share Exchange was accounted for as a reverse merger whereas Ci2i is considered the accounting acquirer and TraQiQ,Inc. is considered the accounting acquiree. For accounting purposes, the acquisition of Omni is recorded at historical cost in accordance with Accounting Standard Codification (“ASC”) 805-50-25-2 as this is considered an acquisition of entities under common control as the management of the Company and Omni control the activities of the respective companies. Prior to the merger with Ci2i and acquisition of Omni, the Company was considered a shell company under Rule 12b-2 of the Exchange Act. On December 1, 2017, The Company entered into a Share Purchase Agreement (the “Share Exchange Agreement”) with Ajay Sikka (“Sikka”), the sole shareholder of Transport IQ, Inc. whereby Sikka agreed to sell all of the shares in TransportIQ, Inc. (“TransportIQ”) in exchange for $18,109, in the form of cancellation of all of the debt of TransportIQ that is owed to the Company. The transaction became effective upon the execution of the Share Exchange Agreement by Sikka and the Company; and Transport IQ, Inc, is now a wholly-owned subsidiary of the Company. Because TransportIQ was commonly controlled and owned, the transaction was recorded at the historical carrying value of TransportIQ’s assets and liabilities.
The Financial Industry Regulatory Authority on March 18, 2022, approved a reverse 1 for 8 stock split of the Company’s common shares. The reverse split was effective on March 21, 2022. The common shares and common share equivalents as well as the per-share amounts have been retroactively restated in accordance with ASC 855-10-25 and the loss per share figures have been retroactively restated in accordance with ASC 260-10-55-12.
~~Overview of the Company~~
With operations concentrated in India, Southeast Asia and Latin America, the Company helps businesses in emerging markets leverage the “gig” or task economy by providing both technology solutions and a network of workers required to fulfill those tasks. The Company provides software as a service that enables clients to build and manage a network of contract task workers. This platform can also be used by business clients to manage their employees who are performing services, such as PC repair or food delivery. In addition, with the recent acquisition of Mimo Technologies Private Limited (“Mimo”), Mimo operates a network of over 14,000 task workers in India who make deliveries, collect payments, do background verifications, and fulfill tasks across the supply chain, as needed by business clients to deliver their products and services to their respective markets and customers.
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TraQSuite is a cloud based software platform with a revenue model based on initial and transaction-based licensing fees as well as consulting fees. Licensees pay an initial per-module fee that varies depending on the number of modules that are licensed. This fee is typically $10,000 per module. Customers are also billed on a per-user or per-transaction basis every month. User fees range from a $75 per month fee for the administrator to $5 per month for regular users. Transaction fees averages about $1 per transaction, with discounts for higher volumes. Most customers also pay initial consulting fees upfront for integration of TraQSuite with their legacy software and training of their employees in the use of TraQSuite.
The Company’s TraQSuite software platform powers the last mile distribution network, allowing business users to target customers, facilitate and validate transactions, track and manage task workers, manage funds and run a distribution network. Key features of the TraQSuite software include:
● ~~Last Mile delivery~~: TraQSuite’s Last-Mile software module enables a business to manage thousands of task workers across multiple geographies to deliver products and services to the users. The software platform, operating through mobile apps, allows for data sharing, delivery validation, geo-tagging and know-your-customer (KYC) requirements and can even measure customer satisfaction.
● ~~Transact~~: TraQSuite enables task workers to facilitate transactions by meeting the end customers. They can collect payments via credit cards, smart-phone swipes, SMS messages or cash. Both banked and unbanked users can buy products and services and pay with their mobile devices.
● ~~Target~~: TraQSuite enables customer transactions to be rewarded with loyalty credits, tokens or points that can be redeemed by the customer for free products, discounts and benefits. The software analyzes these transactions and purchase behaviors by using leading AI models and can deliver real time, automated and targeted offers and recommendations for additional purchases and customer retention.
The Mimo delivery and task service in India runs on the TraQSuite platform and performs deliveries and fulfills tasks for some of the largest businesses in India. Mimo provides delivery and pickup services for the banking and insurance industry, performing verifications, field investigations for loan requests, business verification, employment verification, collection of documents and customer data and assistance in filling out forms for banks. Mimo works with microfinance institutions to collect cash, such as loan payments, convert cash to digital forms such as debit cards, and conduct data collection and surveys. For consumer goods companies, Mimo does promotional marketing, last mile (hyper-local) delivery, merchant onboarding or activation, store audits, and route optimization for delivery.
The Company’s strategy is to grow the business through a combination of organic growth and strategic investments that bring new functionality and revenue streams to the Company. The plan is to enhance the functionality of our existing products, increase sales in the Indian market and entry into new emerging markets. The Company has a presence in India, Southeast Asia and Latin America, and recently added new customers in Australia, New Zealand and parts of Africa.
~~TraQiQ Solutions, Inc.~~
Ci2i is a services company founded in 1998 that develops and deploys intelligent technologies and products in order to meet the demand for sustainable, integrated solutions. Ci2i’s primary focus has been in the analytics and intelligence segments. The Company is investing significantly in building products in the area of supply chain and last mile delivery.
~~Ci2i’s cloud solutions and analytics services comprise software development, program management, project management, and business analytics services.~~
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~~TraQiQ Solutions Private Limited~~
On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation (“Mann”). On January 2, 2020, Mann changed its name to TraQiQ Solutions Private Limited (“TRAQ Pvt Ltd”). Pursuant to the Share Exchange Agreement with Mann, the Company acquired 100% of the shares of Mann and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 166,159 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 12,596 warrants immediately; (ii) 107,494 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 46,069 warrants exercisable two-years after the date of closing. This transaction is being recorded as a business combination under ASC 805. There were 56,400 of these warrants exercised during 2021 and 12,813 warrants remain outstanding as of September 30, 2022.
The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately. A total of 52,391 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.
~~Mann-India Private limited was renamed to TraQiQ Solutions Private Limited shortly after acquisition by TraQiQ Inc.~~
TRAQ Pvt Ltd. was established in May 2000 and is headquartered in New Delhi, India. TRAQ Pvt Ltd. is a leading software development company which, with the advent of technology, has evolved as a mature and fast-growing company committed to provide reliable and cost-effective software solutions across industries all over the world.
~~TRAQ Pvt Ltd. has its own experienced team of software developers dedicated towards developing various kinds of customized software.~~
TraQ Pvt Ltd. has been doing business around the world for over 15 years, with particular emphasis on Latin America and India. The customer list includes large enterprise Finance and Insurance companies across Latin America. The company’s product portfolio has evolved rapidly and now includes enterprise ready solutions for payment processing, mobile wallets, micro lending solutions and digital transformation.
~~Rohuma, LLC~~
On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuma members agreed to exchange all of their respective membership interests in Rohuma in exchange for 536,528 shares of common stock, of which the first tranche of shares were issued on March 1, 2021 totaling 320,285 shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $3,433,776 ($6.40 per share). The Company effective March 31, 2022, determined that the second tranche of shares (133,024) met the criteria to be issued, and the value of $851,353 was reclassified from contingent consideration to stockholders’ equity. Rohuma has an Indian affiliate that is owned 99% by Rohuma and 1% by its founding member. Rohuma controls this entity and the 1% ownership by the member is now less than 1% upon acquisition by the Company. This amount is reflected as a non-controlling interest.
Rohuma dba Kringle.ai is a California based software solutions company that enables digital and mobile commerce by providing enterprise class applications that cover loyalty and rewards products, payments, online ordering, distribution logistics for retail and more. Kringle analyzes customers’ omni-channel behaviors and transactions. Using AI for digital commerce, Kringle is able to deliver real time, automated 1:1 recommendations and personalized content across all customer touch points.
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~~Mimo Technologies Private Limited~~
On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 170,942 shares of the Company’s common stock. Of these warrants, 102,565 were earned at the date of acquisition, with the remaining 68,377 expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.008 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. The Company effective March 31, 2022, determined that the criteria for vesting of the second tranche of warrants was satisfied and reclassified $410,112 from contingent consideration to additional paid in capital. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.
TraQiQ operates the Mimo delivery and task service in India. This service runs on the TraQSuite platform. Mimo has 14,000+ independent contractors across India performing deliveries and fulfilling tasks for the largest corporations in the country. Our team at Mimo uses a sophisticated technology platform and a smartphone app to get their tasks completed. This is coupled with a verification and billing system that allows customers of all sizes to leverage this distribution infrastructure.
~~Mimo offers a broad set of services. These offerings can be classified into three broad categories:~~
● ~~Data collection and client verification (surveys, verification, on-boarding),~~
● ~~Cash management & handling services, and~~
● ~~Distribution and demand generation (order fulfilment, demand generation, delivery services for e-commerce companies)~~
Mimo assists the delivery and pickup segment of the banking and insurance industry by performing verifications, field investigations for loan requests, business verifications and employment verification, and also collects documents, assists in filling forms for banks, and completes data collection from customers.
~~Mimo works with microfinance institutions to collect cash, such as loan payments, convert cash to digital means like debit cards, and conduct data collection and surveys.~~
For consumer goods companies, Mimo does promotional marketing, Last mile (hyper-local) delivery, merchant onboarding or activation, store audits, and route optimization for delivery. Mimo provides efficient end-to-end transshipment logistics. The framework manages and optimizes last-mile delivery & e-commerce logistics across the entire distribution chain with transparency and seamless integration.
~~Mimo is currently in the planning stages to provide food, alcohol & medicine deliveries as well.~~
During the COVID-19 pandemic, Mimo leveraged video as a platform for verification and document delivery. Now, the task workers include people who are in the field on bikes and trucks, people on a video screen, as well as people on the phone.
There are also data digitization tasks being done by Mimo task workers across the country. In a country like India where there are over 20 languages and multiple dialects, the task workers convert paper documents into electronic form in the same language or translate them into another language.
Mimo provides delivery and task worker solutions across India. Mimo works with Banking, Financial, Logistics and Distribution companies, to take their products and services to semi-urban and rural India. Mimo trains the agents in each Product or Service through an online and classroom training platform. The company powers the gig economy task workers throughout the country and provides a very valuable source of employment for young people who may or may not have a high school diploma.
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~~Going Concern~~
The Company has an accumulated deficit of $12,455,033 as of September 30, 2022 and a working capital deficit of $11,362,830, as of September 30, 2022, and a working capital deficit of $9,844,269 as of December 31, 2021. As a result of these factors, management has determined that there is substantial doubt about the Company ability to continue as a going concern.
These consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.
The Company has recently filed a Registration Statement on Form S-1 and engaged an investment banker to undertake an offering of approximately $15,000,000. The investment banker has assisted the Company in raising a bridge round of debt financing in the amount of $1,200,000, which is net of original issue discount of $240,000. Management intends to use the funds received from the capital raise to grow both organically and inorganically by pursuing potential synergistic companies as well as invest in technology and human capital for their existing operations. The Company’s ability to close on this potential offering to raise additional capital is unknown. Obtaining additional financing, including approximately $1,594,000 in the nine months ended September 30, 2022, and the successful development of the Company’s contemplated plan of operations, ultimately, to profitable operations, are necessary for the Company to continue operations.
~~Results of Operations~~
~~Results of Operations and Financial Condition for the Nine Months Ended September 30, 2022 as Compared to the Nine Months Ended September 30, 2021~~
~~Revenues~~
For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s revenues decreased by $923,361, or 44%, from $2,109,087 in 2021 to $1,185,726 in 2022. The decrease is the result of the sale of goods in TraQ Solutions from 2021 to 2022 as well as the reduction of contracts in Rohuma and Mimo.
~~Cost of Revenues~~
For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s cost of revenues decreased by $568,998, or 34%, from $1,664,570 in 2021 to $1,095,572 in 2022. The decrease is the result of the purchase of goods in TraQ Solutions, offset by increased direct costs on some of the Mimo and Rohuma contracts which lead to lower profitability in these new engagements.
~~Operating Expenses~~
For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s salary and salary related costs increased by $37,671, or 8%, from $492,362 in 2021 to $530,033 in 2022 due to 2022 having a full nine months with Rohuma and Mimo as compared to 2021 when there was not a full nine months as those entities were acquired in 2021.
For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s professional fees decreased by $282,286, or 48%, from $585,422 in 2021 to $303,136 in 2022. Our professional fees decreased in 2022 compared to 2021 due to the acquisitions of Rohuma and Mimo where the Company incurred legal and auditing costs for these companies for SEC reporting purposes.
For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s rent expense increased by $7,954, or 34%, from $23,521 in 2021 to $31,475 in 2022 due to the renewal of a lease in 2022.
For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s depreciation and amortization expense increased $32,057, or 59%, from $54,490 in 2021 to $86,547 in 2022. The increase was the result of the depreciation and amortization expense on the fixed and intangible assets acquired in the Rohuma and Mimo acquisitions.
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For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s general and administrative expenses decreased by $2,537,536, or 88%, from $2,893,036 in 2021 to $355,500 in 2022 primarily due to the cutbacks in travel and stock based compensation expenses.
~~Interest Expense~~
For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s interest expense increased by $667,184, or 106%, from $627,720 in 2021 to $1,294,904 in 2022 due to higher levels of debt in 2022 mostly related to related-party debt, and the Evergreen notes as well as the amortization of discounts on the debt instruments.
~~Changes in Fair Value of Derivative Liabilities~~
For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s change in the fair value of the derivative liability increased by $179,565, or 21%, from a loss of $850,221 in 2021 to $670,656 in 2022 due to the changes in the share price over the period September 30, 2022 compared to September 30, 2021.
~~Net Loss~~
For the nine months ended September 30, 2022 compared to September 30, 2021, the Company’s net loss decreased by $1,777,250, from $(5,283,413) in 2021 to $(3,506,163) in 2022 due to the changes noted herein.
~~Results of Operations and Financial Condition for the Three Months Ended September 30, 2022 as Compared to the Three Months Ended September 30, 2021~~
~~Revenues~~
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s revenues decreased by $359,968, or 46%, from $789,699 in 2021 to $429,731 in 2022. The decrease is the result of the sale of goods in TraQ Solutions from 2021 to 2022 as well as the reduction of contracts in Rohuma and Mimo.
~~Cost of Revenues~~
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s cost of revenues decreased by $302,991, or 46%, from $652,542 in 2021 to $349,551 in 2022. The decrease is the result of the purchase of goods in TraQ Solutions, offset by increased direct costs on some of the Mimo and Rohuma contracts which lead to lower profitability in these new engagements.
~~Operating Expenses~~
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s salary and salary related costs slightly decreased by $12,352, or 7%, from $183,349 in 2021 to $170,997 in 2022.
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s professional fees decreased by $203,644, or 68%, from $298,134 in 2021 to $94,490 in 2022. Our professional fees decreased in 2022 compared to 2021 due to the acquisitions of Rohuma and Mimo where the Company incurred legal and auditing costs for these companies for SEC reporting purposes.
40
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s rent expense increased by $6,967, or 87%, from $8,010 in 2021 to $14,977 in 2022 due to the renewal of a lease in 2022.
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s depreciation and amortization expense increased $19,572, or 112%, from $17,471 in 2021 to $37,043 in 2022. The increase was the result of the depreciation and amortization expense on the fixed and intangible assets acquired in the Rohuma and Mimo acquisitions.
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s general and administrative expenses decreased by $1,240,473, or 91%, from $1,365,067 in 2021 to $124,594 in 2022 primarily due to the cutbacks in travel and stock based compensation expenses.
~~Interest Expense~~
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s interest expense increased by $51,930, or 20%, from $264,542 in 2021 to $316,472 in 2022 due to higher levels of debt in 2022 mostly related to related-party debt, and the Evergreen notes as well as the amortization of discounts on the debt instruments.
~~Changes in Fair Value of Derivative Liabilities~~
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s change in the fair value of the derivative liability increased by $838,695, or 242%, from a gain of $345,911 in 2021 to a loss of $492,784 in 2022 due to the changes in the share price over the period September 30, 2022 compared to September 30, 2021.
~~Net Loss~~
For the three months ended September 30, 2022 compared to September 30, 2021, the Company’s net loss decreased by $275,059, from $(1,782,740) in 2021 to $(1,507,681) in 2022 due to the changes noted herein.
~~Liquidity and Capital Resources~~
As of September 30, 2022, current assets were $551,624 and current liabilities outstanding amounted to $11,914,454 which resulted in a working capital deficit of $11,362,830. As of December 31, 2021, current assets were $980,747 and current liabilities outstanding amounted to $10,825,016 which resulted in a working capital deficit of $9,844,269.
Net cash used in operating activities was $1,737,531 for the nine months ended September 30, 2021 compared to $1,048,120 in 2022. Cash used in operations for 2022 and 2021 was the primarily related to the loss in operations offset by increases and decreases in accounts payable and accrued expenses and the changes in accounts receivable due to the lack of adequate cash flow of the Company as well as non-cash charges related to stock-based compensation and the changes in the derivative liabilities.
The only investing activities for the nine months ended September 30, 2022 and 2021, related to the acquisitions of fixed assets related to the Company’s Indian subsidiaries, as well as in 2021 the amount of cash received (paid) in the acquisitions of Rohuma and Mimo Technologies.
Net cash provided by financing activities for the nine months ended September 30, 2021 consisted of proceeds from the issuance of common stock of $494,500 and convertible notes of $1,115,000, along with proceeds received from related party notes of $1,449,394 and $50,331 in proceeds from long-term debt. The Company repaid $781,326 in related party notes, $80,000 in convertible notes and $153,706 in long-term debt during the nine months ended September 30, 2021. During the nine months ended September 30, 2022 the financing activities consisted of proceeds from long-term debt of $753,750, convertible notes of $130,000, and related party notes of $609,997, off set by payments on long-term debt of $270,135 and payments of related party notes of $193,672. In addition, for the nine months ended September 30, 2022 and 2021 there were increases in the cash overdraft of $27,902 and $45,258, respectively.
~~Off-Balance Sheet Arrangements~~
~~We have no off-balance sheet financing arrangements.~~

Item 3. Quantitative and Qualitative Disclosures about Market Risk

None.

41

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Based on an evaluation as of the date of the end of the period covered by this report, the Company’s Certifying Officers conducted an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures, as required by Exchange Act Rule 13a-15. Based on that evaluation, the Company’s Certifying Officers concluded that, because of the disclosed material weaknesses in the Company’s internal control over financial reporting, the Company’s disclosure controls and procedures were ineffective as of the end of the period covered by this report to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms.

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in the Company’s reports filed under the Exchange Act is accumulated and communicated to management, including the Company’s Certifying Officers, to allow timely decisions regarding required disclosure. Based upon the evaluation of the disclosure controls and procedures at the end of the period covered by this report, our Certifying Officers concluded that our disclosure controls and procedures were not effective as a result of continuing weaknesses in our internal control over financial reporting principally due to the following:

- We have not established adequate financial reporting processes or monitoring activities to ensure adequate financial reporting and to mitigate the risk of management override, specifically because there are few employees and only two officers with management functions and therefore there is lack of segregation of duties.

- An outside consultant assists in the preparation of the annual and quarterly financial statements and partners with us to ensure compliance with US GAAP and SEC disclosure requirements.

- Outside counsel assists us to review and editing of the annual and quarterly filings and to ensure compliance with SEC disclosure requirements.

Changes in Internal Control over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting that occurred during the period ended ~~September 30, 2022~~March 31, 2023 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

The term “internal control over financial reporting” is defined as a process designed by, or under the supervision of, the registrant’s principal executive and principal financial officers, or persons performing similar functions, and effected by the registrant’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

(a) Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the registrant;

(b) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the registrant are being made only in accordance with authorizations of management and directors of the registrant; and

(c)I Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the registrant’s assets that could have a material effect on the financial statements.

42

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

We are not a party to any material litigation, nor, to the knowledge of management, is any litigation threatened against us that may materially affect us.

Item 1A. Risk Factors

None.

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

~~The Company is party to a Share Exchange Agreement entered into in January 2021 (the “Rohuma Share Exchange Agreement”) pursuant to which the Company acquired the business of~~ Rohuma, LLC, a Delaware limited liability company (“Rohuma”), from Rohuma’s owners. Pursuant to the Rohuma Share Exchange Agreement, the Company is contingently required to issue additional shares of its common stock to the former owners of Rohuma if certain performance targets are achieved. On June 1, 2022, the Company issued 133,024 shares of its common stock to these former Rohuma owners pursuant to the Rohuma Share Exchange Agreement. Each of these issuances of securities to the two owners located in the United States was consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended. These United States based grantees are sophisticated in business and investment matters. ~~To the extent United States securities laws were deemed to apply to the issuance of such shares to the owners in India, e~~ach of these sales of securities was also consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended, and all of such owners are sophisticated in business and investment matters.None.
The Company is also party to a Share Exchange Agreement entered into in May 2019 (the “Mann Share Exchange Agreement”) and a Share Exchange Agreement entered into in February 2021 (the “Mimo Share Exchange Agreement”) pursuant to which the Company acquired the businesses of Mann-India Technologies Private Ltd., an Indian corporation (“Mann”), and Mimo Technologies Private Ltd., an Indian corporation (“Mimo”), respectively, from the owners of those companies. Pursuant to the Mann Share Exchange Agreement, the Company issued warrants (the “Mann Warrants”) to the Mann owners to purchase shares of the Company’s common stock subject to certain conditions. Pursuant to the Mimo Share Exchange Agreement, the Company issued warrants (the “Mimo Warrants”) to a small number of the Mimo owners to purchase shares of the Company’s common stock subject to certain conditions, and the Company is contingently required to issue additional warrants to purchase its common stock to these former owners of Mimo if certain performance targets are achieved. On June 1, 2022, the Company issued additional warrants to purchase 42,736 shares of its common stock to these former Mimo owners pursuant to the Mimo Share Exchange Agreement. Also on June 1, 2022, the Company issued 179,506 shares of its common stock to three of the former Mann owners and Mimo owners upon exercise of their warrants. Each of the recipients of these warrants and the common stock from the exercise of the warrants are residents of India. To the extent United States securities laws were deemed to apply to the issuance of such warrants and such shares, each of these sales of securities was consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended, as all of such recipients are sophisticated in business and investment matters.

Item 3. Defaults Upon Senior Securities

On June 15, 2021, the Company issued (1) its 2021 Promissory Note (the “Rankich Note”) to Greg Rankich, a director of the Company, in connection with a $400,000 loan to the Company from Mr. Rankich, and (2) 37,500 shares of its Common Stock, par value $0.0001 per share, to Mr. Rankich, which were valued at $8.00 per share. In addition, Mr. Rankich granted to the Company an option to redeem up to 18,750 of such shares (as adjusted for stock splits, stock dividends or similar events) at a total cost of $1.00 if the Note is repaid in full (including accrued and unpaid interest) on or prior to its maturity date (without extension). The Note, which does not bear interest, matured and payment of the principal sum was required on or before 180 days after the date of the Note, subject to certain events of default that could result in acceleration of the maturity. The Company is in default with respect to the Rankich Note because it failed to pay the outstanding principal balance upon the maturity of the Rankich Note. As of November 14, 2022, the amount of the default and total arrearage under the Rankich Note is $400,000.None.
~~On September 17, 2021, the Company entered into a~~ Securities Purchase Agreement (the “Purchase Agreement”) pursuant to which Evergreen Capital Management, LLC (“Evergreen”) agreed to purchase at a discount for an aggregate subscription price of $1,200,000 an aggregate of $1,440,000 in principal amount of three promissory notes (the “Evergreen Notes”). The Evergreen Notes matured on dates ranging from June 17, 2022 to July 15, 2022. The Company is in default with respect to the Evergreen Notes because it failed to pay the outstanding principal balance upon the maturity of the Evergreen Notes. As of November 14 2022, the amount of the default and total arrearage under the Evergreen Notes is $1,440,000 and $198,996 in accrued interest.
43

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

(a) Not applicable.

(b) During the quarter ended ~~September 30, 2022,~~March 31, 2023, there have not been any material changes to the procedures by which security holders may recommend nominees to the Board of Directors.

Item 6. Exhibits

Exhibit Number Description of Exhibit

31.1 Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2 Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1 Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2 Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS Inline XBRL Instance

101.SCH Inline XBRL Taxonomy Extension Schema

101.CAL Inline XBRL Taxonomy Extension Calculation

101.DEF Inline XBRL Taxonomy Extension Definition

101.LAB Inline XBRL Taxonomy Extension Labels

101.PRE Inline XBRL Taxonomy Extension Presentation

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

4443

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.

TraQiQ, Inc.

Date: ~~November 14, 2022~~May 18, 2023 By: /s/ Ajay Sikka
Ajay Sikka
Chief Executive Officer ~~and~~ (principal executive officer)
Date: May 18, 2023 By: /s/ Ajay Sikka
Ajay Sikka
Chief Financial ~~officer~~Officer (principal ~~executive,~~ financial and accounting officer)

4544

	SEPTEMBER 30,			DECEMBER 31,
	2022			2021
	(UNAUDITED)
ASSETS
Current Assets:
Cash	$	63,343		$	56,329
Accounts receivable, net		465,039			774,146
Prepaid expenses and other current assets		23,242			150,272

Total Current Assets		551,624			980,747

Fixed assets, net		38,201			34,165
Intangible assets, net		1,124,867			1,206,966
Goodwill		5,863,058			5,863,058
Restricted cash		104,228			114,199
Deferred tax asset		101,072			116,111
Right-of-use asset		269,235			112,076
Long-term taxes receivable		124,681			122,136
Other assets		2,862			3,137

Total Non-current Assets		7,628,204			7,571,848

TOTAL ASSETS	$	8,179,828		$	8,552,595

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

LIABILITIES
Current Liabilities:
Accounts payable and accrued expenses	$	2,330,356		$	2,146,015
Cash overdraft		247,809			218,747
Accrued payroll and related taxes		264,363			412,144
Accrued taxes and duties payable		129,842			72,169
Deferred revenue		-			3,831
Derivative liability		1,953,276			1,152,620
Contingent consideration - Rohuma		532,600			1,383,954
Contingent consideration - Mimo		246,067			656,179
Current portion - lease liability		12,989			13,071
Current portion - long-term debt - related parties		4,282,696			3,892,463
Current portion - long-term debt		655,262			218,972
Current portion - convertible notes payable, net of discounts		1,259,194			654,851

Total Current Liabilities		11,914,454			10,825,016

Accrued payroll and related taxes, net of current portion		168,392			-
Long-term debt, net of current portion		118,111			36,052
Lease liability, net of current portion		262,543			109,830

Total Non-current Liabilities		549,046			145,882

Total Liabilities		12,463,500			10,970,898

Commitments and contingencies		-			-

STOCKHOLDERS’ EQUITY (DEFICIT)
Preferred stock, par value, $0.0001, 10,000,000 shares authorized, Series A Convertible Preferred, 0 shares issued and outstanding, respectively		-			-
Common stock, par value, $0.0001, 300,000,000 shares authorized, 4,488,538 and 4,171,638 issued and outstanding, respectively		448			417
Subscription receivable		-			-
Additional paid in capital		7,924,818			6,508,931
Accumulated deficit		(12,455,033	)		(8,953,768	)
Accumulated other comprehensive income (loss)		255,484			30,605

Total Stockholders’ Equity (Deficit) before Non-controlling Interest		(4,274,283	)		(2,413,815	)
Non-controlling interest		(9,389	)		(4,488	)

Total Stockholders’ Equity (Deficit)		(4,283,672	)		(2,418,303	)

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	$	8,179,828		$	8,552,595

	March 31,			December 31,
	2023			2022

ASSETS

Current Assets:
Cash	$	139,573		$	1,312
Accounts receivable, net		65,869			-
Prepaid expenses and other current assets		11,025			65,148
Inventory		359,845			-
Total Current Assets		576,312			66,460

Fixed assets, net		1,156			-
Intangible assets, net		10,446,668			-
Goodwill		7,292,885			-
Total Non-current Assets		17,740,709			-

TOTAL ASSETS	$	18,317,021		$	66,460

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

LIABILITIES
Current Liabilities:
Accounts payable and accrued expenses	$	932,348		$	226,178
Contract liabilities		311,544			-
Accrued payroll and related taxes		118,750			24,221
Derivative liability		112,333,348			216,593
Current portion - long-term debt - related parties		-			400,000
Notes payable		3,607,480			751,886
Convertible notes payable, net of discounts		162,094			63,781
Total Current Liabilities		117,465,564			1,682,659

Total Liabilities		117,465,564			1,682,659

STOCKHOLDERS’ EQUITY (DEFICIT)
Convertible preferred stock, par value $0.01, 10,000,000 shares authorized:		-			-
Preferred stock, par value, $0.0001, Series A Convertible Preferred, 0 shares issued and outstanding		-			-
Preferred stock, par value, $0.0001, Series B Convertible Preferred, 1,470,135 and 220,135 shares issued and outstanding, respectively		147			22
Preferred stock value		147			22
Common stock, par value, $0.0001, 300,000,000 shares authorized, 33,939,965 and 18,103,039 issued and outstanding, respectively		3,394			1,810
Additional paid in capital		30,234,923			15,904,755
Accumulated deficit		(129,387,007	)		(17,522,786	)
Accumulated other comprehensive income		-			-

Total Stockholders’ Deficit		(99,148,543	)		(1,616,199	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	18,317,021		$	66,460

	Shares			Amount			Shares		Amount		Common			Deficit			Receivable			Income (Loss)			Interest			Total
											Additional									Accumulated
	Series A Preferred						Common Stock				Paid-In Capital-			Accumulated			Subscription			Other Comprehensive			Non- controlling
	Shares			Amount			Shares		Amount		Common			Deficit			Receivable			Income (Loss)			Interest			Total

Balance - January 1, 2021		50,000		$	5			3,412,245	$	341	$	119,650		$	(2,504,893	)	$	-		$	27,721		$	-		$	(2,357,176	)

Shares of stock issued for cash		-			-			71,250		7		455,993			-			-			-			-			456,000

Shares of stock issued for conversion of notes payable and accrued interest		-			-			33,042		3		224,684			-			-			-			-			224,687

Shares of stock issued for services rendered		-			-			50,000		5		436,380			-			-			-			-			436,385

Shares of stock issued for acquisition of Rohuma (first tranche)		-			-			320,285		32		2,049,789			-			-			-			-			2,049,821

Warrants earned for acquisition of Mimo		-			-			-		-		984,268			-			-			-			-			984,268

Stock-based compensation - warrants granted for consulting		-			-			-		-		68,642			-			-			-			-			68,642

Stock-based compensation on granting of options		-			-			-		-		108,341			-			-			-			-			108,341

Net loss for the period		-			-			-		-		-			(1,691,824	)		-			(6,139	)		1,453			(1,696,510	)

Balance - March 31, 2021		50,000			5			3,886,822		388		4,447,747			(4,196,717	)		-			21,582			1,453			274,458

Shares of stock issued for cash		-			-			4,375		1		38,499			-			-			-			-			38,500

Shares of stock issued for services rendered		-			-			125		-		1,750			-			-			-			-			1,750

Shares of stock issued for providing note payable		-			-			37,500		4		446,996			-			-			-			-			447,000

Stock-based compensation on granting of options		-			-			-		-		118,465			-			-			-			-			118,465

Stock-based compensation for restricted stock grants (shares not issued)		-			-			-		-		40,222			-			-			-			-			40,222

Net loss for the period		-			-			-		-		-			(1,811,412	)		-			(20,809	)		1,110			(1,831,111	)

Balance - June 30, 2021		50,000		$	5			3,928,822	$	393	$	5,093,679		$	(6,008,129	)	$	-		$	773		$	2,563		$	(910,716	)

Conversion of Series A Preferred Stock to Common Stock		(50,000	)		(5	)		6,899		1		4			-			-			-			-			-

Shares issued for exercise of warrants		-			-			56,401		6		-			-			(6	)		-			-			-

Shares of stock issued for services rendered		-			-			150,000		15		1,078,545			-			-			-			-			1,078,560

Stock-based compensation - warrants granted for consulting		-			-			-		-		37,977			-			-			-			-			37,977

Stock-based compensation on granting of options		-			-			-		-		161,691			-			-			-			-			161,691

Stock-based compensation for restricted stock grants (shares not issued)		-			-			-		-		33,208			-			-			-			-			33,208

Net loss for the period		-			-			-		-		-			(1,723,335	)		-			(30,406	)		1,407			(1,752,334	)

Balance - September 30, 2021		-			-			4,142,122		415		6,405,104			(7,731,464	)		(6	)		(29,633	)		3,970			(1,351,614	)

Balance - January 1, 2022		-		$	-			4,171,638	$	417	$	6,508,931		$	(8,953,768	)	$	-		$	30,605		$	(4,488	)	$	(2,418,303	)

Fractional share adjustment		-			-			1,370		-		-			-			-			-			-			-

Stock-based compensation on granting of options		-			-			-		-		18,223			-			-			-			-			18,223

Stock-based compensatuon for restricted stock grants (shares not issued)		-			-			-		-		33,208			-			-			-			-			33,208

Warrants earned for acquisition of Mimo		-			-			-		-		410,112			-			-			-			-			410,112

Net loss for the period		-						-		-		-			(917,348	)		-			103,298			(1,305	)		(815,355	)

Balance - March 31, 2022		-			-			4,173,008		417		6,970,474			(9,871,116	)		-			133,903			(5,793	)		(2,772,115	)

Shares of stock issued in warrant exercises		-			-			179,506		18		125			-			(143	)		-			-			-

Shares of stock issued for acquisition of Rohuma (second tranche)		-			-			133,024		13		851,340			-			-			-			-			851,353
Shares of stock issued for acquisition of Rohuma		-			-			133,024		13		851,340			-			-			-			-			851,353

Stock-based compensation on granting of options		-			-			-		-		18,223			-			-			-			-			18,223

Stock-based compensatuon for restricted stock grants (shares not issued)		-			-			-		-		33,209			-			-			-			-			33,209

Net loss for the period		-			-			-		-		-	��		(1,078,792	)		-			109,989			(1,040	)		(969,843	)

Balance - June 30, 2022		-		$	-			4,485,538	$	448	$	7,873,371		$	(10,949,908	)	$	(143	)	$	243,892		$	(6,833	)	$	(2,839,173	)
Beginning balance		-		$	-			4,485,538	$	448	$	7,873,371		$	(10,949,908	)	$	(143	)	$	243,892		$	(6,833	)	$	(2,839,173	)

Shares of stock issued in warrant exercises		-			-			-		-		-			-			-			-						-

Shares of stock issued with convertible debt		-			-			3,000		-		12,300			-			-			-						12,300

Stock-based compensation on granting of options		-			-			-		-		18,223			-			-			-						18,223

Stock-based compensatuon for restricted stock grants (shares not issued)		-			-			-		-		20,924			-			-			-						20,908

Net loss for the period		-			-			-		-		-			(1,505,125	)					11,592			(2,556	)		(1,496,089	)

Balance - September 30, 2022		-			-			4,488,538		-		7,924,818			(12,455,033	)		-			255,484			(9,389	)		(4,283,672	)
Ending balance		-			-			4,488,538		-		7,924,818			(12,455,033	)		-			255,484			(9,389	)		(4,283,672	)

							2023			2022
							Three Months Ended March 31,
	2022			2021			2023			2022
CASH FLOW FROM OPERTING ACTIVIITES
Net loss	$	(3,501,262	)	$	(5,279,443	)	$	(111,864,221	)	$	(917,348	)
Adjustments to reconcile net loss to net cash (used in) operating activities
Change in non-controlling interest		(11,592	)		(3,970	)		-			(1,305	)
Bank service charges capitalized to defaulted debt principal								4,073			-
Bad debt expense		201,884			261,187			52,110			-
Forgiveness of debt		(18,153	)		(10,057	)		-			(15,401	)
Depreciation and amortization		86,547			54,490			250,994			24,914
Lease cost, net of repayment		(3,583	)		2,910			-			1,807
Foreign currency (gain) loss		28,802			2,658			-			(11,092	)
Stock-based compensation and cashless issuance of shares		154,298			495,116
Common stock issued for services rendered		-			2,037,126
Stock-based compensation								49,548			51,431
Change in fair value of derivative liability and derivative expense		670,656			975,187			111,011,754			(8,190	)
Fees paid in debt financing		3,250			-			-			3,250
Amortization of discounts on debt		646,018			253,414
Amortization of discounts and convertible options on debt								158,794			292,777
Gain on sale of assets		(7	)		(146	)		-			(8	)
Changes in assets and liabilities
Accounts receivable		(136,976	)		(618,164	)		(117,979	)		45,052
Prepaid expenses and other current assets		245,855			31,309			54,123			21,712
Deferred revenue					-
Inventory								19,873
Accounts payable, accrued expenses and deferred taxes		462,326			(393	)		93,957			84,422
Accrued payroll and payroll taxes		59,842			8,899			94,529			6,557
Accrued duties and taxes		63,975			52,346			-			22,034
Total adjustments		2,453,142			3,541,912			111,671,776			517,960
Net cash (used in) operating activities		(1,048,120	)		(1,737,531	)		(192,445	)		(399,388	)

CASH FLOWS FROM INVESTING ACTIVITES
Cash received in acquisition of Mimo		-			42,905
Cash received in acquisition of Rohuma		-			5,951
Acquisition of Mimo		-			(21,856	)
Cash received in acquisition of Recoup								(150,000	)		-
Acquisition of fixed assets		(32,941	)		(3,145	)		-			(25,574	)
Net cash (used in) provided by investing activities		(32,941	)		23,855			(150,000	)		(25,574	)

CASH FLOWS FROM FINANCING ACTIVITES
Increase in cash overdraft		48,162			76,064			-			48,400
Proceeds from the issuance of common stock		-			494,500
Proceeds from convertible notes		130,000			1,115,000			705,000			-
Repayment of convertible notes		-			(80,000	)
Repayments of convertible notes								(60,480	)		-
Proceeds from long-term debt - related parties		609,997			1,449,394			-			205,836
Repayment of long-term debt - related parties		(193,672	)		(781,326	)		-			(63,973	)
Proceeds from long-term debt		753,750			50,331
Repayments of long-term debt		(270,133	)		(153,706	)
Proceeds from notes payable								-			344,652
Repayments of note payable								(163,814	)		(58,615	)
Net cash provided by financing activities		1,078,104			2,170,257			480,706			476,300

NET (DECREASE) INCREASE IN CASH AND RESTRICTED CASH		(2,957	)		456,581
NET INCREASE IN CASH AND RESTRICTED CASH								138,261			51,338

CASH AND RESTRICTED CASH - BEGINNING OF PERIOD		170,528			58,404			1,312			170,528

CASH AND RESTRICTED CASH -END OF PERIOD	$	167,571		$	514,985
CASH AND RESTRICTED CASH - END OF PERIOD							$	139,573		$	221,866

CASH PAID DURING THE PERIOD FOR:
Interest expense	$	37,451		$	51,304		$	986		$	7,991
Income taxes	$	5,679		$	86,411		$	-		$	5,679

SUMMARY OF NON-CASH ACTIVITIES:
Acquisition of Rohuma:
Accounts receivable	$	-		$	4,179
Prepaid and other current assets		-			8,943
Right of use asset for lease liability								-			331,154
Original issue discount recognized on new convertible notes								221,000			-
Shares issued for debt settlement								1,755			-
Acquisition of Recoup:
Inventory							$	379,718		$	-
Fixed assets		-			4,512			1,196			-
Investment		-			1,440
Intangible assets								10,697,622			-

Accounts payable and accrued expenses		-			(58,153	)		(612,213	)		-
Accrued duties and taxes		-			(2,688	)
Long-term debt - related parties		-			(37,776	)
Long-term debt		-			(10,000	)
Cash overdraft		-			(2,980	)
Cash		-			6,027

Customer deposits								(311,544	)		-
Current portion - long-term debt								(3,017,090	)		-
Total net assets acquired		-			(86,496	)		7,137,689			-

Consideration paid in cash								(150,000	)
Consideration per Share Exchange Agreement		-			3,433,776			(14,280,574	)		-

Goodwill/(Bargain Purchase Gain)	$	-		$	3,520,272

Acquisition of Mimo Technologies:
Accounts receivable	$	-		$	58,692
Prepaid and other current assets		-			272,872
Fixed assets		-			153,186
Intellectual property		-			508,669
Tradenames		-			169,556
Accounts payable and accrued expenses		-			(708,833	)
Accrued payroll and related taxes		-			(104,750	)
Accrued duties and taxes		-			(28,213	)
Long-term debt - related parties		-			(343,118	)
Long-term debt		-			(236,712	)
Comprehensive income		-			(42,735	)
Cash		-			43,851

Total net assets acquired		-			(257,535	)

Consideration per Share Exchange Agreement		-			2,085,653

Goodwill/(Bargain Purchase Gain)	$	-		$	2,343,188

Common stock issued for conversion of long-term debt, related and unrelated parties	$	-		$	224,688

Right of use asset for lease liability	$	331,154		$	-
Total Consideration								(14,280,574	)		-
Goodwill							$	(7,292,885	)	$	-

	●	~~Last Mile delivery~~: TraQSuite’s Last-Mile software module enables a business to manage thousands of task workers across multiple geographies to deliver products and services to the users. The software platform, operating through mobile apps, allows for data sharing, delivery validation, geo-tagging and know-your-customer (KYC) requirements and can even measure customer satisfaction.

	●	~~Transact~~: TraQSuite enables task workers to facilitate transactions by meeting the end customers. They can collect payments via credit cards, smart-phone swipes, SMS messages or cash. Both banked and unbanked users can buy products and services and pay with their mobile devices.

	●	~~Target~~: TraQSuite enables customer transactions to be rewarded with loyalty credits, tokens or points that can be redeemed by the customer for free products, discounts and benefits. The software analyzes these transactions and purchase behaviors by using leading AI models and can deliver real time, automated and targeted offers and recommendations for additional purchases and customer retention.

	●	Data collection and client verification (surveys, verification, on-boarding),

	●	Cash management & handling services, and

	●	Distribution and demand generation (order fulfilment, demand generation, delivery services for e-commerce companies)

	●	Transact: TraQSuite enables task workers to facilitate transactions by meeting the end customers. They can collect payments via credit cards, smart-phone swipes, SMS messages or cash. Both banked and unbanked users can buy products and services and pay with their mobile devices.

	●	Target: TraQSuite enables customer transactions to be rewarded with loyalty credits, tokens or points that can be redeemed by the customer for free products, discounts and benefits. The software analyzes these transactions and purchase behaviors by using leading AI models and can deliver real time, automated and targeted offers and recommendations for additional purchases and customer retention.

Intangible and Long-Lived Asset Categories		Estimated Useful Life
Intellectual property		10 Years
Non compete agreement		5 Years
Tradenames		10 Years
Goodwill		Indefinite

	2023		2022
Professional Services Revenue	$	-	$	-
Sale of goods		64,611		-
Software Solution Revenue		429		522
Revenue	$	65,040	$	139,308

	1.	retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective; or

	2.	retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

	Rohuma			Mimo			TSP			Total
	March 31, 2022			March 31, 2022			March 31, 2022			March 31, 2022

REVENUE	$	48,085		$	64,652		$	234,189		$	346,886
COST OF REVENUE		79,065			145,960			135,687			360,712
GROSS PROFIT (LOSS)		(31,020	)		(81,308	)		98,502			(13,826	)

OPERATING EXPENSES
Salaries and salary related costs		104,263			-			17,556			121,819
Professional fees		4,617			18,621			3,190			26,428
Rent expense		442			-			755			1,197
Depreciation and amortization expense		-			11,644			2,145			14,840
General and administrative expenses		4,502			5,809			17,385			27,696

Total Operating Expenses		114,875			36,074			41,031			191,980

OPERATING (LOSS) INCOME		(145,895	)		(117,382	)		57,471			(205,806	)

OTHER INCOME (EXPENSE)
Loss from impairment of intangible assets		-			(776,263	)		-			(776,263	)
Loss from impairment of goodwill		(3,519,869	)		(2,343,188	)		-			(5,863,057	)
Interest expense, net of interest income		(2,126	)		(2,509	)		(14,280	)		(18,915	)
Other income		154			45			2,608			2,807
Total other income (expense)		(3,521,841	)		(3,121,915	)		(11,672	)		(6,655,428	)

INCOME (LOSS) FROM DISTCONTINUED OPERATIONS, BEFORE PROVISION FOR INCOME TAXES		(3,667,736	)		(3,239,297	)		45,799			(6,861,234	)
Provision for income taxes – discontinued operations		367			-			5,312			5,679
LOSS INCOME FROM DISTCONTINUED OPERATIONS	$	(3,668,103	)	$	(3,239,297	)	$	40,487		$	(6,866,913	)

	March 31, 2022
Net cash (used in) provided by operating activities - discontinued operations	$	409,295
Net cash (used in) provided by investing activities - discontinued operations	$	-
Net cash provided by (used in) financing activities - discontinued operations	$	(468,293	)

Type of Consideration		Number of Shares		Fair Value
Cash				$	150,000
Issuance of common stock	a.		15,686,926	$	1,592,318
Issuance of series – B preferred stock	b.		1,250,000	$	12,688,256
Liabilities assumed:
Michaelson Capital Senior Note	c.			$	3,017,090
Accounts Payable and accrued expenses				$	612,213
Contract liabilities				$	311,544
Total consideration				$	18,371,421

	a.	This transaction was exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended
	b.	This transaction was exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended
	c.	Please see Note 12 – Notes Payable

Description	Fair Value		Weighted Average Useful Life (Years)
Fixed assets – truck	$	1,196	7
Inventory		379,718
Intellectual property		10,333,144	10
Tradenames		285,863	10
Noncompete agreement		78,615	5
Goodwill		7,292,885	Indefinite
	$	18,371,421


Cash	$	6,027
Accounts receivables, net		4,179
Prepaid expenses and other current assets		8,943
Fixed assets		4,512
Investment		1,440
Accounts payable and accrued expenses		(58,153	)
Accrued duties and taxes		(2,688	)
Intellectual property		508,669
Tradenames		169,556
Accrued payroll and related taxes		(104,750	)
Comprehensive income		(42,735	)
Cash overdraft		(2,980	)
Debt- related parties		(37,776	)
Debt		(10,000	)
Net assets and liabilities acquired	$	(86,496	)

	For the nine months ended September 30, 2021
Revenues	$	2,145,049
Net income (loss)	$	(5,335,349	)
Net income (loss) per share	$	(0.17	)

	September 30, 2022		December 31, 2021
Cash on hand	$	11,909	$	646
Bank balances		51,434		55,683
Restricted cash		104,228		114,199
Total	$	167,571	$	170,528

	September 30, 2022			December 31, 2021			Estimated Life

Property and equipment – TRAQ Pvt Ltd.	$	266,203		$	627,188		3 - 10 years
Property and equipment – Rohuma US		1,100			1,100		3 - 10 years
Property and equipment – Rohuma India		10,266			9,916		3 – 10 years
Property and Equipment – Mimo Technologies		7,352			7,342		3 – 10 years
Less: accumulated depreciation		(246,720	)		(611,381	)

Net	$	38,201		$	34,165

	September 30, 2022			December 31, 2021			March 31, 2023			December 31, 2022

Customer relationships	$	448,800		$	448,800
Intellectual property		508,669			508,669		$	10,333,144		$	-
Non-compete agreement								78,615			-
Tradenames		204,043			218,799			285,863			-
Software		228,257			250,095
Intangible assets, gross								285,863			-
Less: accumulated amortization		(264,902	)		(219,397	)		(250,954	)		-

Net	$	1,124,867		$	1,206,966		$	10,446,668		$	-
Intangible assets, net							$	10,446,668		$	-

		September 30, 2022			December 31, 2021
Evergreen Capital Management LLC	(a)	$	1,440,000		$	1,440,000
GS Capital Partners, LLC	(b)		144,000			-

Total Convertible Notes Payable		$	1,584,000		$	1,440,000
Less: Discounts			(324,806	)		(785,149	)
Convertible Notes Payable Current		$	1,259,194		$	654,851

		March 31, 2023			December 31, 2022
Evergreen Capital Management LLC - 5	(a)	$	48,000		$	48,000
Evergreen Capital Management LLC - 4	(b)		480,000			-
Evergreen Capital Management LLC - 6	(c)		150,000			-
Evergreen Capital Management LLC - 7	(d)		12,000			-
GS Capital	(e)		51,541			112,021
Chambers	(f)		60,000			-
Eleven 11 Management LLC - 1	(g)		84,000			-
Eleven 11 Management LLC – 2	(h)		60,000			-
Cavalry Fund – 1	(i)		120,000			-
Cavalry Fund – 2	(j)		140,000			-
Cavalry Fund – 3	(k)		100,000			-
Keystone Capital – 1	(l)		90,000			-
Keystone Capital – 2	(m)		30,000			-
Total Convertible Notes Payable		$	1,425,541		$	160,021
Less: Discounts			(1,263,447	)		(96,240	)
Convertible Notes Payable		$	162,094		$	63,781

	(a)	On ~~September 17, 2021,~~October 21, 2022, the Company entered into a 20%20% OID Senior Secured Promissory Note (“Evergeen – 5”) with Evergreen Capital Management, LLC ~~(the “Evergreen 1”~~(“Evergreen”) in the amount of $~~720,000~~48,000 ~~(includes~~(including a $~~120,000~~8,000 of Original Issue Discount). ~~The~~ Evergreen 1- 5 has a maturity of ~~nine~~twelve months to ~~June 17, 2022~~July 21, 2023. ~~The Evergreen 1~~It accrues interest at a rate of 10% per year. Evergreen - 5 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price ~~of Evergreen 1~~ is ~~the lower of (a) $~~equal to ~~11.60~~ ~~(“Fixed Conversion Price”) or (b) upon the occurrence and during the continuation of any Event of Default, if lower,~~ 9075% of the ~~average~~price per share at which the common stock of the ~~two lowest VWAPs for the five (~~5~~) consecutive Trading Day that~~Company is ~~immediately prior~~sold to the ~~applicable Conversion Date (the “Default Conversion Price”).~~public in a qualified offering. There are certain price protections, ~~for Evergreen Capital Management LLC under the terms of Evergreen 1,~~ which make the conversion option a derivative liability. The Company has not repaid this note as of the maturity date and is currently in negotiations with Evergreen Capital Management LLC on revised terms. As a result, this note is in default and subject to the Default Conversion Price. The Company granted ~~62,069~~ ~~warrants that have a term of~~ ~~five-years~~ ~~and an exercise price of $11.60~~ ~~per share with Evergreen 1. The warrants granted with Evergreen 1 also contain certain price protections, that make the value of the warrants a derivative liability.~~

		~~As a commission on this note, the Company granted to the investment bankers,~~ ~~4,966~~ ~~warrants with the same terms as the Evergreen Capital Management warrants. The Company recognized a commission expense for $37,977~~ ~~on these warrants.~~

		~~On October 8, 2021, the Company entered into a~~ 20~~% OID Senior Secured Promissory~~Please see Note ~~in the amount of $480,000~~ ~~(includes $80,000~~ ~~of Original Issue Discount) with Evergreen Capital Management LLC (the “Evergreen 2”). The Evergreen 2 has a~~ ~~maturity of nine months to July 8, 2022. The Evergreen 2 accrues interest at a rate of~~ 10~~% per year. The conversion price of Evergreen 2 is the lower of (a) $11.60~~ ~~(“Fixed Conversion Price”) or (b) upon the occurrence and during the continuation of any Event of Default, if lower,~~ 90~~% of the average of the two lowest VWAPs for the five (~~5) consecutive Trading Day that is immediately prior to the applicable Conversion Date (the “Default Conversion Price”). There are certain price protections for Evergreen Capital Management LLC under the terms of Evergreen 2, which make the conversion option a derivative liability. The Company has not repaid this note as of the maturity date and is currently in negotiations with Evergreen Capital Management LLC on revised terms. As a result, this note is in default and subject to the Default Conversion Price. The Company granted ~~41,379~~ ~~warrants that have a term of~~ ~~five-years~~ ~~and an exercise price of $11.60~~ ~~per share with Evergreen 2. The warrants granted with Evergreen 2 also contain certain price protections, that make the value of the warrants a derivative liability.~~

		~~As a commission on this note, the Company granted to the investment bankers,~~ ~~3,310~~ ~~warrants with the same terms as the Evergreen Capital Management warrants. The Company recognized a commission expense for $9,695~~ ~~on these warrants.~~

		~~On October~~ 15 ~~2021, the Company entered into a~~ 20– Derivative Liabilities.~~% OID Senior Secured Promissory Note in the amount of $240,000~~ ~~(includes $40,000~~ ~~of Original Issue Discount) with Evergreen Capital Management LLC (the “Evergreen 3”). The Evergreen 3 has a~~ ~~maturity of nine months to July 15, 2022. The Evergreen 3 accrues interest at a rate of~~ 10~~% per year. The conversion price of Evergreen 3 is the lower of (a) $11.60~~ ~~(“Fixed Conversion Price”) or (b) upon the occurrence and during the continuation of any Event of Default, if lower,~~ 90~~% of the average of the two lowest VWAPs for the five (~~5) consecutive Trading Day that is immediately prior to the applicable Conversion Date (the “Default Conversion Price”). There are certain price protections for Evergreen Capital Management LLC under the terms of Evergreen 3, which make the conversion option a derivative liability. The Company has not repaid this note as of the maturity date and is currently in negotiations with Evergreen Capital Management LLC on revised terms. As a result, this note is in default and subject to the Default Conversion Price. The Company granted ~~20,690~~ ~~warrants that have a term of~~ ~~five-years~~ ~~and an exercise price of $11.60~~ ~~per share with Evergreen 3. The warrants granted with Evergreen 3 also contain certain price protections, that make the value of the warrants a derivative liability.~~

		~~As a commission on this note, the Company granted to the investment bankers,~~ ~~1,655~~ ~~warrants with the same terms as the Evergreen Capital Management warrants. The Company recognized a commission expense for $5,756~~ ~~on these warrants.~~

		As of June 17, 2021, the Evergreen 1 note is in default as the Company has not repaid the note. Both Evergreen 2 and Evergreen 3 through July 15, 2022 are also in default as the Company has not repaid these notes by the maturity date. As these notes are in default, these notes are subject to the default interest rate of 24%.

		~~Interest expense on these notes for the nine months ended September 30, 2022 is $157,572. Amortization of debt and original issue discounts was $572,294~~ ~~for the nine months ended September 30, 2022.~~

	(b)	On June 15, 2021 the Company issued a $400,000 promissory note to a director with a maturity date of December 12, 2021 (“the director note”). The director note did not bear interest however the director received two tranches of 18,750 shares of Common Stock each for lending this amount. Under the terms of the director note if the note was repaid by the maturity date, one of the two tranches of 18,750 shares was to be returned. The Company and the director extended the maturity date of this note to June 14, 2022, however the note was not repaid and the company was considered to be in default on the director note. On December 30, 2022, the director, the Company, and Evergreen Capital Management, LLC (“Evergreen”) signed a note purchase agreement (the “Evergreen note purchase”). In accordance with the Evergreen note purchase, Evergreen purchased the director note from the director, and the company issued 150,000 shares of its Common Stock to the director for a value of $17,555. Please See Note 13 – Stockholders’ equity (Deficiency). Pursuant to the Evergreen note purchase the Company exchanged the director note with Evergreen for a secured convertible promissory note (“Evergreen – 4”) which was issued on December 30, 2022 and has a maturity date of December 31, 2023. Please Note 11 – Long-Term Debt – Related Parties and Note 15 – Derivative Liabilities.

	(c)	On January 4, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Evergreen – 6”) with Evergreen Capital Management, LLC (“Evergreen”) in the amount of $180,000 (including a $30,000 Original Issue Discount). Evergreen - 6 has a maturity of twelve months ending on January 4, 2024. It accrues interest at a rate of 10% per year. Evergreen - 6 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

	(d)	On February 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Evergreen – 7”) with Evergreen Capital Management, LLC (“Evergreen”) in the amount of $12,000 (including a $2,000 Original Issue Discount). Evergreen - 7 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Evergreen - 7 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

	(e)	On July 5, 2022, the Company entered into a 11%11% OID Senior Secured Promissory Note (the “GS Capital Note”) with GS Capital Partners LLC ~~(the “GS~~(“GS Capital”) in the amount of $144,000 ~~(includes~~(including a $14,000 of Original Issue Discount). The GS Capital Note has a ~~maturity~~term of twelve months tomaturing on July 5, 2023. It accrues interest at a rate of 12% per year. The GS Capital Note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price ~~Subject to the adjustments described herein, the conversion price (the “Conversion Price”) shall be~~is equal to 86% of the lowest trading price of the Company’s Common Stock for the 12 Trading Days immediately preceding the delivery of a notice of conversion. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivatives.

	(f)	On February 16, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (the “Chambers Note”) with James D. Chambers Living Trust (“Chambers”) in the amount of $60,000 (including a $10,000 Original Issue Discount). The Chambers Note has a maturity of twelve months ending on February 28, 2024. It accrues interest at a rate of 10% per year. The Chambers Note also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

	(g)	On February 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Eleven 11 – 1”) with Eleven 11 Management LLC. (“Eleven 11”) in the amount of $60,000 (including a $10,000 Original Issue Discount). Eleven 11 – 1 has a maturity date of February 14, 2024. It accrues interest at a rate of 10% per year. Eleven 11 - 1 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price shall be equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

	(h)	On March 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Eleven 11 – 2”) with Eleven 11 Management LLC. (“Eleven 11”) in the amount of $54,000 (including a $9,000 Original Issue Discount). Eleven 11 – 2 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Eleven 11 - 2 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

	(i)	On March 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Cavalry - 1”) with Cavalry Fund. (“Cavalry”) in the amount of $120,000 (including a $20,000 Original Issue Discount). Cavalry - 1 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Cavalry - 1 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

	(j)	On February 16, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Cavalry – 2”) with Cavalry Fund. (“Cavalry”) in the amount of $140,000 (including a $30,000 Original Issue Discount). Cavalry – 2 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Cavalry - 2 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

	(k)	On March 14, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Cavalry – 3”) with Cavalry Fund. (“Cavalry”) in the amount of $120,000 (including a $20,000 Original Issue Discount). Cavalry – 3 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Cavalry - 3 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

	(l)	On March 3, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Keystone – 1”) with Keystone Capital Partners. (“Keystone”) in the amount of $90,000 (including a $15,000 Original Issue Discount). Keystone – 1 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Keystone - 1 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

	(m)	On March 21, 2023, the Company entered into a 20% OID Senior Secured Promissory Note (“Keystone – 2”) with Keystone Capital Partners. (“Keystone”) in the amount of $30,000 (including a $5,000 Original Issue Discount). Keystone – 2 has a maturity date of February 28, 2024. It accrues interest at a rate of 10% per year. Keystone - 2 also has a conversion feature, enabling it to convert into shares of the Company’s Common Stock upon default. The conversion price is equal to the lower of (1) $0.015 per share or (2) 90% of the average of the two lowest volume-weighted average price of the five trading days ending on the day immediately prior to the conversion date. There are certain price protections, which make the conversion option a derivative liability. Please see Note 15 – Derivative Liabilities.

		September 30, 2022			December 31, 2021

Unsecured advances - CEO	(a)	$	3,287,359		$	2,908,562
Notes payable - Satinder Thiara	(b)		32,000			32,000
Promissory notes – Kunaal Sikka	(c)		265,000			265,000
Notes payable – Swarn Singh	(d)		195,000			195,000
Note payable - Chaudhary	(e)		32,202			8,828
Note payable - Director	(g)		400,000			400,000
Note payable - other	(h)		17,785			-
Advances –officers	(f)		53,350			83,073

Long term debt current - related parties			4,282,696			3,892,463
Current portion of long-term debt related parties			(4,282,696	)		(3,892,463	)
Long-term debt – related parties		$	-		$	-

		March 31, 2023		December 31, 2022

Note payable - Director	(a)	$	-	$	400,000
Long-term debt related parties			-		400,000

Current portion of long-term debt related parties			-		(400,000	)
Long-term debt – related parties		$	-	$	-

(a)	~~This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at~~ 15~~% annually (1.25% monthly) and are due on demand.~~

~~(b)~~	~~Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due~~ ~~December 31, 2021, December 13, 2016 ($10,000) which is due~~ ~~December 31, 2021, and May 1, 2018 ($25,000) which matured~~ ~~December 31, 2019~~ ~~at interest rate of~~ 15~~% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to~~ 21~~% annually (1.75% monthly). The May 1, 2018 note that matured December 31, 2019 was converted along with $12,392~~ ~~in accrued interest into~~ ~~5,499~~ ~~shares of common stock on March 5, 2021.~~

~~(c)~~	~~Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on~~ ~~December 31, 2019, and accruing interest at an annual rate of~~ 12~~%. The note was in default as of December 31, 2019 through~~On June ~~25, 2021 when the note was extended until December 31, 2022. As a result the interest rate was changed to~~ 18~~% annually (1.50% monthly) through June 25, 2021 and then changed to~~ 6~~% annually.~~

	~~Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated December~~ 15, 2021 in the ~~amount of~~Company issued a $~~250,000~~400,000~~, maturing on~~ ~~December 31, 2022, and accruing interest at an annual rate of~~ 15%.

~~(d)~~	~~Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of~~ 15~~% annually (1.25% monthly). These are unsecured notes. Both notes were due~~ ~~December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to~~ 21~~% annually (1.75% monthly).~~

	~~Unsecured~~ promissory note to ~~Swarn Singh, father-in-law of the CEO, dated December 15, 2021, in the amount of $150,000, maturing on~~ ~~December 31, 2022, and accruing interest at an annual rate of~~ 15%.

~~(e)~~	~~Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of~~ ~~1,100,000~~ ~~INR (approximately $14,500~~ ~~US$) due on demand at~~ 13~~% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,860~~.

~~(f)~~	~~Note payable to officer dated June 18, 2020 in the amount of~~ ~~7,650,000~~ ~~INR (approximately $100,000~~ ~~US$) interest free and due on demand~~a director with a ~~balance~~maturity date of $~~53,350~~ ~~as of September 30, 2022.~~

~~(g)~~	~~Note payable to a director dated June 15, 2021 that matured~~ December 12, 2021 in (“the ~~amount of $400,000~~director note”).. The director note ~~does~~did not bear interest however the director received two tranches of 18,750 shares of Common Stock each for lending this amount. Under the terms of the director note if the note was repaid by the maturity date, one of the two tranches of 18,750 shares was to be returned. The Company and the director extended the maturity date of this note to June 14, ~~2022. As of September~~2022, however the note was not repaid and the company was considered to be in default on the director note. On December 30, 2022, the director, the Company, and Evergreen Capital Management, LLC (“Evergreen”) signed a note ~~has not been repaid. The~~purchase agreement (the “Evergreen note purchase”). In accordance with the Evergreen note purchase, Evergreen purchased the director note from the director, and the company issued 150,000 shares of its Common Stock to the director for a value of $17,555. Please See Note 13 – Stockholders’ equity (Deficiency). Pursuant to the Evergreen note purchase the Company ~~are negotiating revised terms. As a result of the failure to repay~~ exchanged director the note ~~by the~~with Evergreen for a secured convertible promissory note (“Evergreen – 4”) which was issued on December 30, 2022 and has a maturity date ~~the note is in default.~~

~~(h)~~	of December 31, 2023. Please Note ~~payable with a company owned by the CEO dated April 2, 2022 in the amount of $17,786~~10 – Convertible Notes Payable and Note 15 – Derivative Liabilities. at 8~~% interest per annum, due on demand.~~

(a)	~~Note payable to~~This Company signed an ~~individual~~agreement with Baxter Credit Union for $~~7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made~~ a ~~payment of $1,500~~ ~~against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider. The amount was settled in 2022.~~

~~(b)~~	~~On February 11, 2022, the Company entered into a $115,640~~ ~~promissory note with Sixth Street Lending LLC. The promissory note contains an original issue discount of $12,390. Interest on the promissory note is eleven percent per annum (~~11~~%) and the promissory note matures~~ ~~February 11, 2023. The interest rate increases to~~ 22~~% if an event of default occurs. The Company is to make mandatory monthly payments of $12,836~~ per month in ten installments beginning March 30, 2022. Should an event of default occur, the holder of the promissory note will have the right to convert any portion of the outstanding principal and interest at the lowest price on the preceding trading day. The Company has reserved ~~180,688~~ ~~shares of common stock with the transfer agent to account for any potential conversions.~~