As filed with the U.S. Securities and Exchange Commission on ~~September~~February 12, ~~2019~~2021

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. [ ]

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]

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

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 7(a)(2)(B) of the Securities Act. [ ]

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission acting pursuant to said section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

This is a firm commitment public offering of ____ shares of common stock, $0.001 par value per share (the “Common Stock”) of ~~Surge Holdings,~~SurgePays, Inc.

Our Common Stock is presently quoted on the OTCQB Marketplace under the symbol “SURG”. The last reported sales price for our Common Stock, as reported on the OTCQB on ~~September 11, 2019~~[ ], 2021, was ~~$0.35.~~$[ ].

Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page 68 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of ~~these~~the securities offered hereby, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

We have granted a 45-day option to the ~~representative of the underwriters~~underwriter to purchase up to an aggregate of additional shares of Common Stock, solely to cover over-allotments, if any.

The ~~underwriters expect~~underwriter expects to deliver our shares to purchasers in the offering on or about ~~2019.~~[ ], 2021.

You should rely only on information contained in this prospectus or in any free writing prospectus we may authorize to be delivered or made available to you. We have not, and the ~~underwriters have~~underwriter has not, authorized anyone to provide you with additional information or information different from that contained in this prospectus or in any free writing prospectus. Neither the delivery of this prospectus nor the sale of our securities means that the information contained in this prospectus or any free writing prospectus is correct after the date of this prospectus or such free writing prospectus. This prospectus is not an offer to sell or the solicitation of an offer to buy our securities inunder any circumstances ~~under~~in which the offer or solicitation is unlawful or in any state or other jurisdiction where the offer is not permitted.

The information in this prospectus is accurate only as of the date on the front cover of this prospectus and the information in any free writing prospectus that we may provide you in connection with this offering is accurate only as of the date of that free writing prospectus. Our business, financial condition, results of operations and prospects may have changed since those dates.

No person is authorized in connection with this prospectus to give any information or to make any representations about us, the securities offered hereby or any matter discussed in this prospectus, other than the information and representations contained in this prospectus. If any other information or representation is given or made, such information or representation may not be relied upon as having been authorized by us.

Through and including ~~, 2019~~[ ], 2021 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.

Neither we nor ~~any of~~ the ~~underwriters~~underwriter have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than the United States. You are required to inform yourself about, and to observe any restrictions relating to, this offering and the distribution of this prospectus.

SUMMARY CONSOLIDATED FINANCIAL INFORMATION

The following summary consolidated statements of operations data for the years ended December 31, ~~2018~~2019 and ~~2017~~2018 have been derived from our audited consolidated financial statements included elsewhere in this prospectus. The summary consolidated statements of operations data for the ~~six~~nine months ended ~~June~~September 30, ~~2019~~2020 and ~~2018~~2019 and the consolidated balance sheets data as of ~~June~~September 30, ~~2019~~2020 are derived from our unaudited consolidated financial statements that are included elsewhere in this prospectus. The historical financial data presented below is not necessarily indicative of our financial results in future periods, and the results for the ~~six~~nine months ended ~~June~~September 30, ~~2019~~2020 are not necessarily indicative of our operating results to be expected for the full fiscal year ending December 31, ~~2019~~2020 or any other period. You should read the summary consolidated financial data in conjunction with those financial statements and the accompanying notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Our consolidated financial statements are prepared and presented in accordance with United States generally accepted accounting principles (“U.S. GAAP”). Our unaudited consolidated financial statements have been prepared on a basis consistent with our audited financial statements and include all adjustments, consisting of normal and recurring adjustments that we consider necessary for a fair presentation of the financial position and results of operations as of and for such periods.

SUMMARY STATEMENTS OF OPERATIONS DATA

	For The Six Months Ended June 30,						For The Fiscal Years Ended December 31*,						For The Nine Months Ended September 30,						For The Fiscal Years Ended December 31*,
	(unaudited) 2019			(unaudited) 2018			2018			2017			(unaudited) 2020			(unaudited) 2019			2019			2018
Revenue	$	7,393,194		$	7,485,563		$	15,244,155		$	13,459,980		$	43,104,767		$	12,295,058		$	25,742,941			15,244,155
Cost of Revenue		4,791,322			3,920,270			8,570,240			8,096,076			39,422,776			7,814,614			20,305,453			8,570,240
Gross Profit		2,601,872			3,565,293			6,673,915			5,363,904			3,681,991			4,480,444			5,437,488			6,673,915
Cost and Expenses
Depreciation and Amortization		21,124			62,813			149,642			6,939			876,152			39,050			227,322			149,642
Selling, General and Administrative		6,224,564			3,286,151			8,059,742			5,152,680			11,138,464			9,222,923			12,978,194			8,059,742
Total Costs and Expenses		6,245,688			3,348,964			8,209,384			5,159,619			12,014,616			9,261,973			13,205,516			8,209,384
Operating Profit (Loss)		(3,643,816	)		216,329			(1,535,469	)		204,285			(8,332,625	)		(4,781,529	)		(7,768,028	)		(1,535,469	)
Other Income (Expense):
Interest expense		72,390			87,409			(140,457	)		(24,021	)		(2,348,175	)		(93,157	)		(227,016	)		(140,457	)
Derivative expense														(529,294	)		—			—			—
Change in fair value of derivative liability		-			(2,619	)		(4,105	)		-			405,413			—			4,013			(4,105	)
Change in fair value of LTC cryptocurrency		-			50,906			(95,387	)		-			—			—			—			(95,387	)
Gain on investment in Centercom		(64,775	)		-									252,985			70,909			25,192			—
Gain (loss) on settlement of liabilities		466,187			-			43,117			2,587,600			2,556,979			(466,187	)		(481,187	)		43,117
Gain on sale of assets		-			-			273,453			-			—			—			—			273,453
Other income														10,000			—			—			—
Total other income (expense)		473,802			135,696			76,621			2,563,579			347,908			(488,435	)		(678,998	)		76,621
Net Income (Loss) Before Provision for Income Taxes		(4,117,618	)		80,633			(1,458,848	)		2,767,864
Net Loss Before Provision for Income Taxes														(7,984,717	)		(5,269,964	)		(8,447,026	)		(1,458,848	)
Provision for Income Taxes		-			54,750			82,230			-			—			—			—			82,230
Net Income (Loss)		(4,117,618			25,883			(1,541,078	)		2,767,864
Net Loss														(7,984,717	)		(5,269,964	)		(8,447,026	)		(1,541,078	)
Net Loss Per Common Share, Basic and Diluted		(0.04	)		(0.00	)		(0.02	)		0.04			(0.07	)		(0.06	)		(0.09	)		(0.02	)
Weighted Average Number of Common Shares Outstanding, Basic and Diluted		92,066,948			76,206,307			81,566,892			76,183,385
Weighted Average Common Shares Outstanding, Basic and Diluted														108,246,505			94,225,836			96,186,742			81,566,892

*	derived from our audited consolidated financial statements.

SELECTED BALANCE SHEET DATA

	Nine Months Ended September 30, 2020			For The Fiscal Years Ended December 31,
Consolidated Balance Sheet Data:	(unaudited)			2019			2018
Cash and cash equivalents	$	421,315		$	346,040		$	444,612
Working Capital (deficit)	$	(10,773,543	)	$	(3,479,239	)	$	(1,732,215	)
Total assets	$	7,657,786		$	9,986,373		$	4,084,318
Current liabilities	$	5,479,508		$	7,054,124		$	4,792,035
Total liabilities	$	16,566,277		$	14,685,988		$	6,072,551
Total stockholders’ equity (deficit)	$	(8,908,491	)	$	(4,699,615	)	$	(1,988,233	)

The following table presents consolidated balance sheets data as of ~~June~~September 30, ~~2019~~2020 on:

●

an actual basis;


	●	a pro forma basis, giving effect to the sale by us of shares of Common Stock, at an assumed public offering price of $ per share, after deducting underwriting discounts and commissions and estimated offering expenses.

The pro forma information will be adjusted based on the actual public offering price and other terms of this offering determined at pricing.

	Actual			Pro Forma⁽¹⁾	Actual			Pro Forma⁽¹⁾
Consolidated Balance Sheet Data:
Cash and cash equivalents	$	1,438,457		$	$	421,315		$
Working capital (deficit)		(1,487,070	)		$	[10,773,543	]
Total assets		5,248,301				7,657,786
Total liabilities		7,073,019				16,566,277
Total stockholders’ equity (deficit)		(1,824,718	)			(8,908,491	)

(1)

A $1.00 increase or decrease in the assumed public offering price per share would increase or decrease our cash and cash equivalents, working capital (deficit), total assets and total stockholders’ equity (deficit) by approximately $________, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the underwriting discount and estimated offering expenses payable by us.

RISK FACTORS

Investing in our securities involves a great deal of risk. Careful consideration should be made of the following factors as well as other information included in this prospectus before deciding to purchase our securities. There are many risks that affect our business and results of operations, some of which are beyond our control. Our business, financial condition or operating results could be materially harmed by any of these risks. This could cause the trading price of our securities to decline, and you may lose all or part of your investment. Additional risks that we do not yet know of or that we currently think are immaterial may also affect our business and results of operations.

RISKS RELATED TO OUR COMPANY

Changes in the regulatory framework under which we operate could adversely affect our business prospects or results of operations.

Our operations are subject to regulation by the FCC and other federal, state and local agencies. These regulatory regimes frequently restrict or impose conditions on our ability to operate in designated areas and provide specified products or services. We are frequently required to maintain licenses for our operations and conduct our operations in accordance with prescribed standards. We are often involved in regulatory and other governmental proceedings or inquiries related to the application of these requirements. It is impossible to predict with any certainty the outcome of pending federal and state regulatory proceedings relating to our operations, or the reviews by federal or state courts of regulatory rulings. Without relief, existing laws and regulations may inhibit our ability to expand our business and introduce new products and services. Similarly, we cannot guarantee that we will be successful in obtaining the licenses needed to carry out our business plan or in maintaining our existing licenses. For example, the FCC grants wireless licenses for terms generally lasting 10ten (10) years, subject to renewal. The loss of, or a material limitation on, certain of our licenses could have a material adverse effect on our business, results of operations and financial condition.

New laws or regulations or changes to the existing regulatory framework at the federal, state and local level, such as those described below, could restrict the ways in which we manage our wireline and wireless networks and operate our business, impose additional costs, impair revenue opportunities and potentially impede our ability to provide services in a manner that would be attractive to us and our customers.

●

Privacy and data protection - we are subject to federal, state and international laws related to privacy and data protection. A new privacy law scheduled ~~to take effect~~took in California in 2020, also could have a significant impact on certain of our businesses.

●

Regulation of broadband Internet access services - In its 2015 Title II Order, the FCC nullified its longstanding “light touch” approach to regulating broadband Internet access services and “reclassified” these services as telecommunications services subject to utilities-style common carriage regulation. The FCC repealed the 2015 Title II Order in December 2017 and returned to its traditional light-touch approach for these services. The 2017 order has been appealed to the D.C. Circuit; the outcome and timing of this appeal or any other challenge remains uncertain. Several states have also adopted or are considering adopting laws or executive orders that would impose net neutrality and other requirements on some of our services (in some cases different from the FCC’s 2015 rules). The enforceability and effect of these state rules is uncertain.

●

“Open Access” - we hold certain wireless licenses that require us to comply with so-called “open access” FCC regulations, which generally require licensees of particular spectrum to allow customers to use devices and applications of their choice. Moreover, certain services could be subject to conflicting regulation by the FCC and/or various state and local authorities, which could significantly increase the cost of implementing and introducing new services.

The further regulation of broadband, wireless and our other activities and any related court decisions could restrict our ability to compete in the marketplace and limit the return we can expect to achieve on past and future investments in our ~~networks~~networks.

Changes to the federal Lifeline Assistance Program could negatively impact the growth of our True Wireless business and its profitability.

True Wireless offers service to low-income subscribers eligible for the federal Lifeline Assistance ~~program.~~Program. True Wireless provides a monthly discount to eligible subscribers in the form of free blocks of minutes and text messages. This discount is subsidized by the Low-Income Program of the federal USF and administered by the Universal Service Administrative Company. In 2012, the FCC adopted reforms to the Low Income program to increase program effectiveness and efficiencies. More stringent eligibility and certification requirements have made it more difficult for Lifeline service providers to sign up and retain Lifeline subscribers. Some regulators and legislators have questioned the structure of the current program, and the FCC is continuing to review and implement measures to improve the program, including enforcement action involving alleged rule violations, and roll-out of the National Lifeline Accountability Database. Changes in the Lifeline program as a result of the ongoing FCC proceeding or new legislation, or potential enforcement action, could negatively impact growth of True Wireless and/or the profitability of True Wireless.

If we are not able to adapt to changes and disruptions in technology and address changing consumer demand on a timely basis, we may experience a decline in the demand for our services, be unable to implement our business strategy and experience reduced profits.

Our industries are rapidly changing as new technologies are developed that offer consumers an array of choices for their communications needs and allow new entrants into the markets we serve. In order to grow and remain competitive, we will need to adapt to future changes in technology, enhance our existing offerings and introduce new offerings to address our customers’ changing demands. If we are unable to meet future challenges from competing technologies on a timely basis or at an acceptable cost, we could lose customers to our competitors. We may not be able to accurately predict technological trends or the success of new services in the market. In addition, there could be legal or regulatory restraints on our introduction of new services. If our services fail to gain acceptance in the marketplace, or if costs associated with the implementation and introduction of these services materially increase, our ability to retain and attract customers could be adversely affected. Additionally, we must phase out outdated and unprofitable technologies and services. If we are unable to do so on a cost-effective basis, we could experience reduced profits. In addition, there could be legal or regulatory restraints on our ability to phase out current ~~services~~services.

Failure to develop new products, such as cross-media solutions, that are compelling for the marketplace in the expected time frame may adversely affect the combined company’s future results.

As the media and advertising industry looks to evaluate investments such as advertising campaigns across various forms of media, such as television, radio, online, and mobile, the ability to measure the combined size and composition of audiences across platforms is increasingly important and demanded. A primary strategic reason for this business combination is to allow our companies to more quickly and effectively develop cross-media capabilities using the combined talents and assets of the two companies to meet a growing market demand. The management of the combined company may face significant challenges in developing new products while integrating existing products and technologies. If the companies are not successful in developing credible products in the expected timeframe, the anticipated benefits of the merger may not be realized fully or at all or may take longer to realize than expected.

We may expand through investments in, acquisitions of, or the development of new products with assistance from, other companies, any of which may not be successful and may divert our management’s attention.

In the past, we completed several strategic acquisitions. We also may evaluate and enter into discussions regarding an array of potential strategic transactions, including acquiring complementary products, technologies or businesses. An acquisition, investment or business relationship may result in unforeseen operating difficulties and expenditures. In particular, we may encounter difficulties integrating the businesses, technologies, products, personnel or operations of the acquired companies, particularly if the key personnel of the acquired company choose not to be employed by us, and we may have difficulty retaining the customers of any acquired business due to changes in management and ownership. Acquisitions may also disrupt our ongoing business, divert our resources and require significant management attention that would otherwise be available for ongoing development of our business. Moreover, we cannot assure you that the anticipated benefits of any acquisition, investment or business relationship would be realized timely, if at all, or that we would not be exposed to unknown liabilities. In connection with any such transaction, we may:

●

encounter difficulties retaining key employees of the acquired company or integrating diverse business cultures;

●

incur large charges or substantial liabilities, including without limitation, liabilities associated with products or technologies accused or found to infringe on third-party intellectual property rights or violate existing or future privacy regulations;


●	issue shares of our capital stock as part of the consideration, which may be dilutive to existing stockholders;


●	become subject to adverse tax consequences, legal disputes, substantial depreciation or deferred compensation charges;


●	use cash that we may otherwise need for ongoing or future operation of our business;

●

enter new geographic markets that subject us to different laws and regulations that may have an adverse impact on our business;


●	experience difficulties effectively utilizing acquired assets;


●	encounter difficulties integrating the information and financial reporting systems of acquired businesses, particularly those that operated under accounting principles other than those generally accepted in the U.S. prior to the acquisition by us; and


●	incur debt, which may be on terms unfavorable to us or that we are unable to repay.

Our business could be adversely affected if we fail to implement and maintain effective disclosure controls and procedures and internal control over financial reporting.

We concluded that as of December 31, 2018, our disclosure controls and procedures and our internal control over financial reporting were not effective. We have determined that we have limited resources for adequate personnel to prepare and file reports under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) within the required time periods and that material weaknesses in our internal control over financial reporting exist relating to not being able to provide for adequate review of our financial statements. If we are unable to implement and maintain effective disclosure controls and procedures and remediate the material weaknesses in a timely manner, or if we identify other material weaknesses in the future, our ability to produce accurate and timely financial statements and public reports could be impaired, which could adversely affect our business and financial condition. We identified a lack of sufficient segregation of duties. In addition, investors may lose confidence in our reported information and the market price of our Common Stock may decline.

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

We need substantial capital to implement our sales distribution strategy for our current products, strategic acquisitions to maximize existing technologies to create opportunities to create synergy and ~~to develop and commercialize future products.~~opportunity. Our capital requirements will depend on many factors, including but not limited to:

●

the problems, delays, expenses, and complications frequently encountered by early-stage companies;


●	market acceptance of our products;


●	the success of our sales and marketing programs; and

We expect, if we sell at least $10,000,000 of our shares of Common Stock, that the net proceeds of such sales along with our current cash position, to be able to fund our operating expenses and capital expenditure for at least the next two years. Thereafter, unless we achieve profitability, we anticipate that we will need to raise additional capital to fund our operations and to otherwise implement our overall business strategy. We currently do not have any contracts or commitments for additional financing. There can be no assurance that financing will be available in amounts or on terms acceptable to us, if at all. Any additional equity financing may involve substantial dilution to then existing shareholders.

●

we expect, if we raise at least $15,000,000 in this offering, that the net proceeds of such sales along with our current cash position, to be able to fund our operating expenses and capital expenditure for at least the next two years. Thereafter, unless we achieve profitability, we anticipate that we will need to raise additional capital to fund our operations and to otherwise implement our overall business strategy. We currently do not have any contracts or commitments for additional financing. There can be no assurance that financing will be available in amounts or on terms acceptable to us, if at all. Any additional equity financing may involve substantial dilution to then existing shareholders.

If adequate funds are not available or if we fail to obtain acceptable additional financing, we may be required to:

●

severely limit or cease our operations or otherwise reduce planned expenditures and forego other business opportunities, which could harm our business;


●	obtain financing with terms that may have the effect of substantially diluting or adversely affecting the holdings or the rights of the holders of our capital stock; or


●	obtain funds through arrangements with future collaboration partners or others that may require us to relinquish rights to some or all of our technologies or products.

Our success is substantially dependent on the continued service of our senior management.

Our success is substantially dependent on the continued service of our Chief Executive Officer (“CEO), Kevin Brian Cox, our Chief Financial Officer (“CFO”), ~~Brian M. Speck,~~Tony Evers, and ~~Chief Operating Officer (“COO”),~~President, Anthony P. Nuzzo. ~~The Company does~~We do not carry key person life insurance on any of its management, which would leave ~~the Company~~us uncompensated for the loss of any of its management. The loss of the services of any of our senior management could make it more difficult to successfully operate our business and achieve our business goals. In addition, our failure to retain qualified personnel in the diverse areas required for continuing its operations could harm our product development capabilities and customer and employee relationships, delay the growth of sales of our products and could result in the loss of key information, expertise or know-how.

We may not be able to hire or retain other key personnel required for our business, which could disrupt the development and sales of our products and limit our ability to grow.

Competition in our industry for senior management and other key personnel is intense. If we are unable to retain our existing personnel, or attract and train additional qualified personnel, either because of competition in our industry for such personnel or because of insufficient financial resources, our growth may be limited.

Our CEO and Chairman, Kevin Brian Cox, has significant control over shareholder matters and the minority shareholders will have little or no control over our affairs.

Mr. Cox currently owns approximately ~~69%~~56% of our outstanding voting equity and, on a fully diluted basis, based on the conversion feature of the Series A and Series C Convertible Preferred Stock, 72% of our shares outstanding. Subject to any fiduciary duties owed to our other stockholders under Nevada law, Mr. Cox is able to exercise significant influence over matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions, and will have some control over our management and policies. Mr. Cox may have interests that are different from yours. For example, Mr. Cox may support proposals and actions with which you may disagree. The concentration of ownership could delay or prevent a change in control of our Company or otherwise discourage a potential acquirer from attempting to obtain control of our Company, which in turn could reduce the price of our stock. In addition, Mr. Cox could use his voting influence to maintain our existing management and directors in office, delay or prevent changes in control of our Company, or support or reject other management and board proposals that are subject to stockholder approval, such as amendments to our employee stock plans and approvals of significant financing transactions.

We may not have sufficient resources to effectively introduce and market our services and products, which could materially harm our operating results.

Continuation of market acceptance for our existing services and products require substantial marketing efforts and will require our sales account executives and contract partners to make significant expenditures of time and money. In some instances, we will be significantly or totally reliant on the marketing efforts and expenditures of our contract partners, outside sales agents and distributors.

Because we currently have very limited marketing resources and sales capabilities, commercialization of our products, some of which require regulatory clearance prior to market entrance, we must either expand our own marketing and sales capabilities or consider collaborating with additional third parties to perform these functions. We may, in some instances, rely significantly on sales, marketing and distribution arrangements with collaborative partners and other third parties. In these instances, our future revenue will be materially dependent upon the success of the efforts of these third parties.

Should we determine that expanding our own marketing and sales capabilities is required, we may not be able to attract and retain qualified personnel to serve in our sales and marketing organization, to develop an effective distribution network or to otherwise effectively support our commercialization activities. The cost of establishing and maintaining a more comprehensive sales and marketing organization may exceed its cost effectiveness. If we fail to further develop our sales and marketing capabilities, if sales efforts are not effective or if costs of increasing sales and marketing capabilities exceed their cost effectiveness, our business, results of operations and financial condition would be materially adversely affected.

Risks and uncertainties related to the Company’s foreign operations could negatively impact the Company’s operating results.

Centercom, our subsidiary, operates in El Salvador. Doing business in El Salvador, and in Latin America generally, involves increased risks related to geo-political events, political instability, corruption, economic volatility, property crime, drug cartel and gang-related violence, social and ethnic unrest including riots and looting, enforcement of property rights, governmental regulations, tax policies, banking policies or restrictions, foreign investment policies, public safety, health and security, anti-money laundering regulations, interest rate regulation and import/export regulations among others. As in many developing markets, there are also uncertainties as to how both local law and U.S. federal law is applied, including areas involving commercial transactions and foreign investment. As a result, actions or events could occur in El Salvador that are beyond the Company’s control, which could restrict or eliminate the Company’s ability to operate in El Salvador or significantly reduce customer traffic, product demand and the expected profitability of such operations.

We operate in a highly competitive industry.

We may encounter competition from local, regional or national entities, some of which have superior resources or other competitive advantages in the larger wireless services space. Intense competition may adversely affect our business, financial condition or results of operations. These competitors may be larger and more highly capitalized, with greater name recognition. We will compete with such companies on brand name, quality of services, level of expertise, advertising, product and service innovation and differentiation of product and services. As a result, our ability to secure significant market share may be impeded.

RISKS RELATED TO OUR SECURITIES

Sales of a significant number of shares of our Common Stock in the public market or the perception of such possible sales, could depress the market price of our Common Stock.

Sales of a substantial number of shares of our Common Stock in the public markets, which include an offering of our preferred stock or Common Stock could depress the market price of our Common Stock and impair our ability to raise capital through the sale of additional equity or equity-related securities. We cannot predict the effect that future sales of our Common Stock or other equity-related securities would have on the market price of our Common Stock.

Our share price could be volatile and our trading volume may fluctuate substantially.

The price of our Common Stock has been and may in the future continue to be extremely volatile. Many factors could have a significant impact on the future price of our shares of Common Stock, including:

	●	our inability to raise additional capital to fund our operations, whether through the issuance of equity securities or debt;

	●	our failure to successfully implement our business objectives;

	●	compliance with ongoing regulatory requirements;

	●	market acceptance of our products;

	●	changes in government regulations;

	●	general economic conditions and other external factors;

	●	actual or anticipated fluctuations in our quarterly financial and operating results; and

	●	the degree of trading liquidity in our shares of Common Stock.

A decline in the price of our shares of Common Stock could affect our ability to raise further working capital and adversely impact our ability to continue operations.

The relatively low price of our shares of Common Stock, and a decline in the price of our shares of Common Stock, could result in a reduction in the liquidity of our Common Stock and a reduction in our ability to raise capital. Because a significant portion of our operations has been and will continue to be financed through the sale of equity securities, a decline in the price of our shares of Common Stock could be especially detrimental to our liquidity and our operations. Such reductions and declines may force us to reallocate funds from other planned uses and may have a significant negative effect on our business plans and operations, including our ability to continue our current operations. If the price for our shares of Common Stock declines, it may be more difficult to raise additional capital. If we are unable to raise sufficient capital, and we are unable to generate funds from operations sufficient to meet our obligations, we will not have the resources to continue our operations.

The market price for our shares of Common Stock may also be affected by our ability to meet or exceed expectations of analysts or investors. Any failure to meet these expectations, even if minor, may have a material adverse effect on the market price of our shares of Common Stock.

Financial Industry Regulatory Authority (“FINRA”) sales practice requirements may also limit a stockholder’s ability to buy and sell our Common Stock.

FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our Common Stock, which may limit your ability to buy and sell our Common Stock and have an adverse effect on the market for our shares.

“Penny Stock” rules may make buying or selling our ~~common stock~~Common Stock difficult.

Trading in our ~~common stock~~Common Stock has previously been subject to the “penny stock” rules. The SEC has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. These rules require that any broker-dealer that recommends our ~~common stock~~Common Stock to persons other than prior customers and accredited investors, must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchaser’s written agreement to execute the transaction. Unless an exception is available, the regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market. In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in our ~~common stock,~~Common Stock, which could severely limit the market price and liquidity of our ~~common stock.~~Common Stock.

We currently do not intend to pay dividends on our Common Stock. As result, your only opportunity to achieve a return on your investment is if the price of our Common Stock appreciates.

We currently do not expect to declare or pay dividends on our Common Stock. In addition, in the future we may enter into agreements that prohibit or restrict our ability to declare or pay dividends on our Common Stock. As a result, your only opportunity to achieve a return on your investment will be if the market price of our Common Stock appreciates and you sell your shares at a profit.

We could issue additional Common Stock, which might dilute the book value of our Common Stock.

Our Board has authority, without action or vote of our shareholders, to issue all or a part of our authorized but unissued shares. Such stock issuances could be made at a price that reflects a discount or a premium from the then-current trading price of our Common Stock. In addition, in order to raise capital, we may need to issue securities that are convertible into or exchangeable for our Common Stock. These issuances would dilute the percentage ownership interest, which would have the effect of reducing your influence on matters on which our shareholders vote, and might dilute the book value of our Common Stock. You may incur additional dilution if holders of stock warrants or options, whether currently outstanding or subsequently granted, exercise their options, or if warrant holders exercise their warrants to purchase shares of our Common Stock.

Future Issuance of Our Common Stock, Preferred Stock, Options and Warrants Could Dilute the Interests of Existing Stockholders.

We may issue additional shares of our Common Stock, preferred stock, options and warrants in the future. The issuance of a substantial amount of Common Stock, options and warrants could have the effect of substantially diluting the interests of our current stockholders. In addition, the sale of a substantial amount of Common Stock or preferred stock in the public market, or the exercise of a substantial number of warrants and options either in the initial issuance or in a subsequent resale by the target company in an acquisition which received such Common Stock as consideration or by investors who acquired such Common Stock in a private placement could have an adverse effect on the market price of our Common Stock.

RISKS RELATED TO THE OFFERING

Investors in This Offering Will Experience Immediate and Substantial Dilution in Net Tangible Book Value.

The public offering price per share of our Common will be substantially higher than the net tangible book value per share of our outstanding Common Stock. As a result, investors in this offering will incur immediate dilution of $$[ ] per share, based on the assumed public offering price of $$[ ] per share. Investors in this offering will pay a price per share that substantially exceeds the book value of our assets after subtracting our liabilities. See “Dilution” for a more complete description of how the value of your investment will be diluted upon the completion of this offering.

We May Need Additional Capital, and the Sale of Additional Shares or Equity or Debt Securities Could Result in Additional Dilution to Our Stockholders.

We believe that our existing cash, together with the net proceeds from this offering, will be sufficient to meet our anticipated cash needs for at least the next two years. We may, however, require additional cash resources due to changed business conditions or other future developments. If these resources are insufficient to satisfy our cash requirements, we may seek to sell additional equity or debt securities or obtain one or more credit facilities. The sale of additional equity securities could result in additional dilution to our stockholders and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a Common Stock holder. The incurrence of indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations. It is uncertain whether financing will be available in amounts or on terms acceptable to us, if at all.

If we raise additional funds through government grants, collaborations, strategic alliances, licensing arrangements or marketing and distribution arrangements, we may have to relinquish valuable rights to our technologies, future revenue stream or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market products that we would otherwise prefer to develop and market ourselves.

We Have Broad Discretion in the Use of the Net Proceeds from This Offering and May Not Use Them Effectively.

Our management will have broad discretion in the application of the net proceeds, including for any of the purposes described in the section of this prospectus entitled “Use of Proceeds.” You will be relying on the judgment of our management with regard to the use of these net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the net proceeds are being used appropriately. The failure by our management to apply these funds effectively could result in financial losses that could have a material adverse effect on our business, cause the price of our securities to decline and delay the development of our product candidates. Pending the application of these funds, we may invest the net proceeds from this offering in a manner that does not produce income or that loses value.

Substantial future sales of shares of our Common Stock in the public market could cause our stock price to fall.

Holders of shares of Common Stock that we have issued, including shares of Common Stock issuable upon conversion and/or exercise of outstanding convertible notes, shares of preferred stock options and warrants, may be entitled to dispose of their shares pursuant to an exemption from registration under the Securities Act. Additional sales of a substantial number of our shares of our Common Stock in the public market, or the perception that sales could occur, could have a material adverse effect on the price of our Common Stock. Our Common Stock is quoted on the OTCQB Marketplace and there is not now, nor has there been, any significant market for shares of our Common Stock, and an active trading market for our shares may never develop or be sustained. Investors are currently able to use Rule 144 promulgated under the Securities Act to sell shares of our Common Stock and, if they do so, the then-prevailing market prices for our Common Stock may be reduced. Any substantial sales of our Common Stock may have an adverse effect on the market price of our securities.

Sales of a substantial number of shares of our Common Stock in the public market following this offering could cause the market price of our Common Stock to decline. If there are more shares of Common Stock offered for sale than buyers are willing to purchase, then the market price of our Common Stock may decline to a market price at which buyers are willing to purchase the offered shares of Common Stock and sellers remain willing to sell the shares. Following the effectiveness of the registration statement of which this prospectus forms a part, all of the shares of Common Stock sold to Northbridge pursuant to the Investment Agreement will be freely tradable without restriction or further registration under the Securities Act.

USE OF PROCEEDS

We estimate that the net proceeds from the sale of the shares of Common Stock in the offering will be approximately ~~$ million,~~, after deducting the underwriting discounts and commissions and estimated offering expenses, or ~~$ million~~ if the ~~underwriters exercise~~underwriter exercises their over-allotment option in full.

We intend to use the net proceeds of this offering for general corporate purposes, which may include working capital, retiring trade payables, marketing, development of product pipeline, technology development, legal fees, other corporate expenses, acquisitions of complementary products, product candidates, technologies or businesses, and repayment of notes payable (used for general corporate expenses). However, we currently have no present agreements or commitments for any such acquisitions and no guarantee can be made that we will make such acquisitions in the future.

We currently expect to use the net proceeds of this offering primarily for the following purposes:

	●	approximately ~~$2,547,473~~$[ ] for the repayment of loans (used for general corporate expenses) that have the following interest rates and maturity date: a Line of Credit ($~~930,973)~~[ ]), notes payable and current portion of long-term debt ($~~562,500)~~[ ]), and long-term debt less current portion – related party ($~~1,054,000)~~[ ])

	●	approximately $$[ ] for [ ];

	●	approximately $

	●	~~approximately $~~$[ ] for [ ]; and

	●	the remainder for working capital and other general corporate purposes.

We believe that the expected net proceeds from this offering and our existing cash and cash equivalents, together with interest thereon, will be sufficient to fund our operations for at least the next two years, although we cannot assure you that this will occur.

The amount and timing of our actual expenditures will depend on numerous factors, including the status of our development efforts, sales and marketing activities and the amount of cash generated or used by our operations. We may find it necessary or advisable to use portions of the proceeds for other purposes, and we will have broad discretion and flexibility in the application of the net proceeds. Pending these uses, the proceeds will be invested in short-term bank deposits.

MARKET FOR OUR COMMON STOCK AND RELATED STOCKHOLDER MATTERS

Market and Other Information

Our Common Stock is quoted on the OTCQB under the trading symbol “SURG”. ~~The Company’s~~Our shares began trading on July 24, 2007.

As of ~~September 11, 2019,~~[ ], 2021, there were approximately ~~134~~[ ] holders of record of our Common Stock. The last reported sales price for our Common Stock, as reported on the OTCQB on ~~September 11, 2019~~[ ], 2021, was ~~$0.35.~~

$[ ].

Dividend Policy

To date, we have not paid any dividends on our Common Stock and do not anticipate paying any such dividends in the foreseeable future. The declaration and payment of dividends on the Common Stock is at the discretion of our board of directors and will depend on, among other things, our operating results, financial condition, capital requirements, contractual restrictions or such other factors as our board of directors may deem relevant. We currently expect to use all available funds to finance the future development and expansion of our business and do not anticipate paying dividends on our Common Stock in the foreseeable future.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. Forward-looking statements involve risks and uncertainties and include statements regarding, among other things, our projected revenue growth and profitability, our growth strategies and opportunity, anticipated trends in our market and our anticipated needs for working capital. They are generally identifiable by use of the words “may,” “will,” “should,” “anticipate,” “estimate,” “plans,” “potential,” “projects,” “continuing,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend” or the negative of these words or other variations on these words or comparable terminology. These statements may be found under the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business,” as well as in this prospectus generally. In particular, these include statements relating to future actions, prospective products, market acceptance, future performance or results of current and anticipated products, sales efforts, expenses, and the outcome of contingencies such as legal proceedings and financial results. Such forward-looking statements include, without limitation, statements regarding:

●

our need for, and our ability to raise, additional equity or debt financing on acceptable terms, if at all;

	●	our need to take additional cost reduction measures, cease operations or sell our operating assets, if we are unable to obtain sufficient additional financing;

	●	our belief that we have sufficient liquidity to finance normal operations;

	●	the options we may pursue in light of our financial condition;

	●	the amount of cash necessary to operate our business;

	●	the expected expenses of, and benefits and results from, our research and development efforts;

	●	general economic conditions;

	●	the anticipated future financial performance and business operations of our company; and

	●	our ability to retain our core group of personnel.

We operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for us to predict all of those risks, nor can we assess the impact of all of those risks on our business or the extent to which any factor may cause actual results to differ materially from those contained in any forward-looking statement. The forward-looking statements in this prospectus are based on assumptions management believes are reasonable. However, due to the uncertainties associated with forward-looking statements, you should not place undue reliance on any forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and unless required by law, we expressly disclaim any obligation or undertaking to publicly update any of them in light of new information, future events, or otherwise.

CAPITALIZATION

The following table sets forth our consolidated cash and capitalization as of ~~June~~September 30, ~~2019.~~2020. Such information is set forth on the following basis:

	●	on an actual basis.

	●	on a pro forma basis, giving effect to the sale by us of [ ] shares of Common Stock, at an assumed public offering price of $$[ ] per share, after deducting underwriting discounts and commissions and estimated offering expenses.

The pro forma information below is illustrative only and our capitalization following the completion of this offering will be adjusted based on the actual public offering price and other terms of this offering determined at pricing. You should read this table together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our audited and unaudited consolidated financial statements and the related notes appearing elsewhere in this prospectus.

	Actual			Pro Forma	Actual		Pro Forma
Cash and cash equivalents	$	1,438,457		$	$	421,315	$

Stockholders’ deficit:
Series A preferred stock: $0.001 par value; 100,000,000 shares authorized; 13,000,000 shares issued and outstanding at June 30, 2019		13,000
Series C convertible preferred stock; $0.001 par value; 1,000,000 shares authorized; 721,598 shares issued and outstanding at June 30, 2019		722
Common stock: $0.001 par value; 500,000,000 shares authorized; 97,988,818 shares issued and outstanding at June 30, 2019		97,989
Series A preferred stock: $0.001 par value; 13,000,000 shares authorized; 13,000,000 shares issued and outstanding at [ ], 2021						13,000
Series C convertible preferred stock; $0.001 par value; 1,000,000 shares authorized; [721,598] shares issued and outstanding at [ ], 2021						722
Common stock: $0.001 par value; 500,000,000 shares authorized; 123,407,519 shares issued and outstanding at [ �� ], 2021						116,235
Additional paid in capital		4,604,735				9,816,841
Accumulated deficit		(6,541,164	)			(18,855,289)
Total stockholders’ deficit		(1,824,718	)			(8,908,491)

A $1.00 increase or decrease in the assumed public offering price per share would increase or decrease our pro forma cash, additional paid-in capital, total stockholders’ equity (deficit) and total capitalization by approximately $______ assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the underwriting discount and estimated offering expenses payable by us.

DILUTION

If you invest in our securities, your investment will be diluted immediately to the extent of the difference between the public offering price per share of Common Stock you pay in this offering, and the pro forma net tangible book value per share of Common Stock immediately after this offering.

Net tangible book value (deficit) represents the amount of our total tangible assets reduced by our total liabilities. Tangible assets equal our total assets less intangible assets. Pro forma net tangible book value per share represents our pro forma net tangible book value divided by the number of shares of Common Stock outstanding. As of ~~June 30, 2019,~~[ ], 2021, our actual net tangible deficit value was ~~$2,738,443~~$[ ] and our net tangible book deficit per share was ~~$(0.03).~~$[ ].

After giving effect to the sale of shares of Common Stock at the assumed public offering price of $ per share, and after deducting the underwriting discount and commission and estimated offering expenses, our pro forma net tangible book value (deficit) as of ~~June 30, 2019~~[ ], 2021 would have been $ , or $ per share. This represents an immediate increase in pro forma net tangible book value (deficit) of $ per share to existing stockholders and immediate dilution of $ per share to new investors purchasing shares in the offering.

The following table illustrates this per share dilution:

As of
June 30, 2019 Pro Forma⁽¹⁾
Assumed public offering price per share
Net tangible book deficit value per share as of June 30, 2019 $ (0.03 ) $
Increase in pro forma net tangible book value per share attributable to new investors $
Pro forma net tangible book value per share after giving effect to this offering
Dilution in net tangible book value per share to new investors

	As of September 30, 2020	Pro Forma⁽¹⁾
Assumed public offering price per share
Net tangible book deficit value per share as of [ ], 2021	$	$
Increase in pro forma net tangible book value per share attributable to new investors	$
Pro forma net tangible book value per share after giving effect to this offering
Dilution in net tangible book value per share to new investors

⁽¹⁾	Calculated on a pro forma basis, giving effect to the conversion of all our outstanding shares of preferred stock into Common Stock.

If the underwriter’s overallotment option is exercised, our adjusted pro forma net tangible book value following the offering will be $ per share, and the dilution to new investors in the offering will be $ per share.

A $1.00 increase or decrease in the assumed public offering price per share would increase or decrease our pro forma as adjusted net tangible book value after this offering by approximately $ , and dilution per share to new investors by approximately $ for an increase of $1.00, or $( ) for a decrease of $1.00, after deducting the underwriting discount and estimated offering expenses payable by us.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Management’s Discussion and Analysis of Financial Condition and Results of Operations includes a number of forward-looking statements that reflect Management’s current views with respect to future events and financial performance. You can identify these statements by forward-looking words such as “may” “will,” “expect,” “anticipate,” “believe,” “estimate” and “continue,” or similar words. Those statements include statements regarding the intent, belief or current expectations of us and members of its management team as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risk and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements.

Readers are urged to carefully review and consider the various disclosures made by us in this report and in our other reports filed with the Securities and Exchange Commission. Important factors currently known to us could cause actual results to differ materially from those in forward-looking statements. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in the future operating results over time. We believe that its assumptions are based upon reasonable data derived from and known about our business and operations and the business and operations of the Company. No assurances are made that actual results of operations or the results of our future activities will not differ materially from its assumptions. Factors that could cause differences include, but are not limited to, expected market demand for the Company’s services, fluctuations in pricing for materials, and competition.

On or about the time that this Registration Statement is filed with the SEC, Logics plans to file a separate registration statement on Form S-1 with the SEC pursuant to which approximately 25% of the fully-diluted equity of Logics will be sold to the public. Following the Logics IPO, Logics will remain a majority-owned subsidiary of SurgePays, and SurgePays will therefore have the ability to control the outcome of significant decisions regarding the operations, management and other aspects of Logics’ business.

COMPARISON OF THREE MONTHS ENDED ~~JUNE~~SEPTEMBER 30, ~~2019~~2020 AND ~~2018~~2019

Revenues during the three months ended ~~June~~September 30, ~~2019~~2020 and ~~2018~~2019 consisted of the following:

	2019		2018		2020		2019
Revenue	$	3,454,420	$	4,054,665	$	12,802,172	$	4,901,864
Cost of revenue		2,311,755		2,169,203		11,216,186		3,023,292
Gross profit	$	1,142,665	$	1,885,462	$	1,585,986	$	1,878,572

Revenue ~~and gross profit decreased $600,245 (14.8%~~increased $7,900,308 (161%) ~~and $142,552 (6.6%) respectively~~ primarily as a result of ~~reduced~~the addition of the ECS revenues of $8,278,549 and an increase of $1,738,427 in Surge Logics LLC offset by decreases of $792,893 in True Wireless, Inc. and $2,715,478 in Surge Blockchain LLC while overall gross profit decreased $292,586 (16%) primarily as a result of a decrease in gross profit of $572,194 in Surge Blockchain LLC that offset the gross profit gains from the addition of the ECS revenues.

Costs and expenses during the three months ended ~~June~~September 30, ~~2019~~2020 and ~~2018~~2019 consisted of the following:

	2019		2018		2020		2019
Depreciation and amortization	$	10,586	$	61,586	$	306,341	$	17,926
Selling, general and administration		3,663,783		2,016,066		2,904,569		2,998,359
Total	$	3,674,369	$	2,077,652	$	3,210,910	$	3,016,285

Depreciation and amortization ~~decreased $51,000~~increased $288,415 primarily as a result of the ~~transfer of Surge Cryptocurrency Mining assets and liabilities to a third party under the sole control of Brian Cox, our CEO and Chairman~~addition of the ~~Board, in December 2018.~~ECS assets.

Selling, general and administrative costs (S, G & A) increased $1,647,717 (81.7%) primarily as a result of the merger between Surge Holdings, Inc. and True Wireless, Inc. The S, G & A expenses of the Surge companies represent $2,687,958 of the expenses that are not included in the 2018 expenses.

Selling, general and administrative expenses during the three months ended ~~June~~September 30, 2020 and 2019 consisted of the following:

	2020		2019
Telecom operations center	$	757,502	$	599,474
Professional services and consultants		201,185		977,831
Compensation		1,143,380		508,254
Webhosting/internet		172,155		152,066
Advertising and marketing		56,742		189,528
Other		573,604		571,204
Total	$	2,904,568	$	2,998,357

Selling, general and administrative costs (S, G & A) decreased by $93,789 (3%). The 2020 period includes $183,464 in expenses for the ECS companies that are not included in the 2019 expenses. The detail changes are discussed below:

●

Telecom operations center expenses increased from $599,474 in 2019 to $757,502 in 2020, primarily as a result of the contracting vendor providing additional services for Surge Blockchain, LLC and Surge Logics, Inc.

●

Professional services and consultants decreased to $201,185 in 2020 from $977,831 in 2019, primarily due to a reduction in the use of outside IT services on the SurgePays portal and outside management services.

●

Compensation increased from $508,254 in 2019 to $1,143,380 in 2020, primarily as a result of the increase in staff support positions to support the expected increase in revenue in the coming months and to replace the outside management services. The 2020 period includes $52,736 in expense of the ECS companies that are not included in the 2019 expenses.

●

Webhosting/internet costs increased to $172,155 in 2020 from $152,066 in 2019.

●

Advertising and marketing costs decreased to $56,742 in 2020 from $189,528 in 2019 primarily due to us reducing advertising and marketing costs while evaluating future advertising and marketing campaigns.

Other (expense) income during the three months ended September 30, 2020 and 2019 consisted of the following:

	2020			2019
Interest, net	$	(1,164,409	)	$	(20,767	)
Change in fair value of derivative liability		212,851			-
Derivative expense		(33,239	)		-
Gain on equity investment in Centercom		107,649			6,134
	$	(877,148	)	$	(14,633	)

Interest expense increased to $1,164,409 in 2020 from $20,767 in 2019, primarily due to an increase in total borrowings.

During the three months ended September 30, 2020, we identified certain embedded features within its borrowings that required us to classify the features as derivative liabilities. We recognized a change in fair value during the three months ended September 30, 2020 of $212,851. In addition, we recorded a derivative expense of $33,239 which represents the debt discount and derivative features that exceed the face value of the notes.

The gain on equity investment in Centercom of $107,649 in 2020 compared to $6,134 in 2019.

COMPARISON OF NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

Revenues during the nine months ended September 30, 2020 and 2019 consisted of the following:

	2020		2019
Revenue	$	43,104,767	$	12,295,058
Cost of revenue		39,422,776		7,814,614
Gross profit	$	3,681,991	$	4,480,444

Revenue increased $30,809,709 (251%) primarily as a result of the addition of the ECS revenues of $27,081,145 and an increase of $9,271,269 in Surge Logics LLC offset by decreases of $3,830,138 in True Wireless, Inc. and $3,859,775 in Surge Blockchain LLC while gross profit decreased $798,453 (18%) primarily as a result of a decreases in gross profit of $1,369,410 in True Wireless, Inc. and $900,695 of Surge Blockchain LLC that offset the gross profit gains from the increased revenues of the other subsidiaries.

Costs and expenses during the nine months ended September 30, 2020 and 2019 consisted of the following:

	2020		2019
Depreciation and amortization	$	876,152	$	39,050
Selling, general and administration		11,138,464		9,222,923
Total	$	12,014,616	$	9,261,973

Depreciation and amortization increased $837,102 primarily as a result of the addition of the ECS assets.

Selling, general and administrative expensesduring the nine months ended September 30, 2020 and 2019 consisted of the following:

	2020		2019
Telecom operations center	$	2,121,225	$	1,625,774
Professional services and consultants		2,435,970		2,880,825
Compensation		2,657,875		1,326,821
Webhosting/internet		533,569		457,996
Advertising and marketing		209,699		1,079,715
DRIP fees		-		547,000
Bad debt expense		1,633,575		7,841
Other		1,546,551		1,296,951
Total	$	11,138,464	$	9,222,923

Selling, general and administrative costs (S, G & A) increased by $1,915,540 (21%). The 2020 period includes $612,943 in expenses for the ECS companies that are not included in the 2019 expenses. The detail changes are discussed below:

●

Telecom operations center expenses increased from $1,625,774 in 2019 to $2,121,225 in 2020, primarily as a result of the contracting vendor providing additional services for Surge Blockchain, LLC and Surge Logics, Inc.

●

Professional services and consultants decreased to $2,435,970 in 2020 from $2,880,825 in 2019, primarily due to outside IT services on the SurgePays portal and a decrease in the use of outside management services. The 2020 period includes $164,289 in expenses of the ECS companies that are not included in the 2019 expenses.

●

Compensation increased from $1,326,821 in 2019 to $2,657,875 in 2020, primarily as a result of the increase in staff support positions to support the expected increase in revenue in the coming months and to replace the outside management services. The 2020 period includes $157,805 in expense of the ECS companies that are not included in the 2019 expenses.

●

Webhosting/internet costs increased to $533,569 in 2020 from $457,996 in 2019.

●

DRIP fees decreased from $547,000 for the nine months ended September 30, 2019 to $0 for the nine months ended September 30, 2020, as a result of our entering into a Distributive Resolution & Integration Program (“DRIP”) with the Asian American Trade Association (“AATAC”) to provide products and services for up to 40,000 locations in 2019. The DRIP fees were a one-time location activation fee.

●

Advertising and marketing costs decreased to $209,699 in 2020 from $1,079,715 in 2019, primarily due to us reducing advertising and marketing costs while evaluating future advertising and marketing campaigns.

●

Bad debt expense increased to $1,633,575 in 2020 from $7,841 in 2019, primarily due to our evaluation of the receivables generated during the initial rollout of the SurgePays portal and providing an appropriate allowance for bad debts.

●

Other costs increased to $1,546,551 in 2020 from $1,296,951 in 2019, primarily due to an increase in fidelity, cyber security and professional liability insurance required for the issuance of the SurgePays Visa debit card, shareholder communications and travel. The 2020 period includes $217,231 in expenses of the ECS companies that are not included in 2019 expenses.

Other (expense) income during the nine months ended September 30, 2020 and 2019 consisted of the following:

	2020			2019
Interest, net	$	(2,348,175	)	$	(93,157	)
Change in fair value of derivative liability		405,413			-
Derivative expense		(529,294	)		-
Gain on equity investment in Centercom		252,985			70,909
Gain (loss) on settlement of liabilities		2,556,979			(466,187	)
Other income		10,000			-
	$	347,908		$	(488,435	)

Interest expense increased to $2,348,175 in 2020 from $93,157 in 2019 primarily due to an increase in total borrowings.

During the nine months ended September 30, 2020, we identified certain embedded features within its borrowings that required us to classify the features as derivative liabilities. We recognized a change in fair value during the nine months ended September 30, 2020 of $405,413. In addition, we recorded a derivative expense of $529,294 which represents the debt discount and derivative features that exceed the face value of the notes.

The gain on equity investment in Centercom of $252,985 in 2020 compared to $70,909 in 2019.

During the nine months ended September 30, 2019, we settled outstanding liabilities through the issuance of 875,000 shares of Common Stock and recorded a loss on settlement of $507,000. During the nine months ended September 30, 2020, we settled outstanding liabilities through the issuance of 8,150,000 shares of Common Stock and recorded a gain on settlement of $2,556,979.

LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN

At September 30, 2020 and December 31, 2019, our current assets were $1,175,121 and $3,574,885 , respectively, and our current liabilities were $11,970,664 and $7,054,124, respectively, which resulted in a working capital deficit of $10,773,543 and $3,479,239, respectively.

Total assets at September 30, 2020 and December 31, 2019 amounted to $7,635,786 and $9,986,373 , respectively. At September 30, 2020, assets consisted of current assets of $1,175,121, net property and equipment of $249,871, net intangible assets of $4,406,497, goodwill of $866,782, equity investment in Centercom of $456,685, and operating lease right of use asset of $419,372, as compared to current assets of $3,574,885, net property and equipment of $294,616, net intangible assets of $4,769,117, goodwill of $866,782, equity investment in Centercom of $203,700, operating lease right of use asset of $210,816 and other long-term assets of $66,457 at December 31, 2019.

At September 30, 2020, our total liabilities of $16,566,277 increased $1,880,289 from $14,685,988 at December 31, 2019.

At September 30, 2020, our total stockholders’ deficit was $8,908,491 as compared to $4,699,615 at December 31, 2019. The principal reason for the increase in stockholders’ deficit was the impact of the net loss of $7,984,717 offset by equity issuances during 2020.

The following table sets forth the major sources and uses of cash for the nine months ended September 30, 2020 and 2019.

	2020			2019

Net cash used in operating activities	$	(3,377,619	)	$	(4,987,079	)
Net cash used in investing activities		10,812			(222,000	)
Net cash provided by financing activities		3,442,082			4,908,370
Net change in cash and cash equivalents	$	75,275		$	(300,709	)

At September 30, 2020, we had the following material commitments and contingencies.

Notes payable – related party - See Note 7 to the Condensed Consolidated Financial Statements.

Notes payable and long-term debt - See Note 8 to the Condensed Consolidated Financial Statements.

Convertible promissory notes - See Note 9 to the Condensed Consolidated Financial Statements.

Advances from related party - See Note 14 to the Condensed Consolidated Financial Statements.

Cash requirements and capital expenditures – At the current level of operations, we had to borrow funds to meet basic operating costs.

Known trends and uncertainties – We are planning to acquire other businesses that are similar to its operations. The uncertainty of the economy may increase the difficulty of raising funds to support the planned business expansion.

Liquidity – We had a net loss of approximately $7.9 million for the nine months ended September 30, 2020. As of September 30, 2020, we had cash and working capital deficit of approximately $421,000 and $10.8 million, respectively.

Management’s ability to pivot in 2020 due to the Coronavirus allowed us to finalize enhancements to both the SurgePays and Logics Intake platforms, resulting in improved end user control on product logistics. We also overhauled its entire customer service platform and standard operating procedures to ensure rapid growth success. Management continued efforts to source products for our client base, including an exclusivity to provide gift card distribution at all locations.

During the year ended December 31, 2019, the Surge software development team has successfully implemented the merging of the SurgePays and ECS software to more efficiently and cost effectively increase synergized revenue and profitability moving forward.

The development of the Surge Logistics Intake software and the infrastructure at Centercom BPO have enabled rapid scaling growth and evidenced in Surge Logics revenue trajectory.

To support the significant growth inflection, we has reorganized its human resources department, including building the administrative, legal and finance office in Bartlett, TN and the operations center in El Salvador which will be able to now host 300 employees. Management believes we now have the ability to scale to support its expected growth in 2020, which was a major goal for fiscal year 2019. During the year ended December 31, 2019 and the nine months ended September 30, 2020, we were able to continue the utilization of the internal controls and operating procedures and techniques employed by our management in order to enhance the business by creating operating efficiencies and controlling costs. Lastly, we have significantly restructured its balance sheet to be an effective platform for growth as we continue to work towards listing on the Nasdaq Capital Market in the near term. There can be no assurances that we will be successful in achieving a listing on the Nasdaq Capital Market in the near term.

In March 2020, the World Health Organization declared COVID-19 a pandemic. COVID-19 could disrupt the economy, our supply chain, and access to capital sources thus adversely affecting our ability to continue its operations.

These factors, among others, were addressed by management in determining whether we could continue as a going concern. We project that it should be cash flow positive by the end of Quarter 1 2021, through increased cash flow from ongoing operations the collection of outstanding receivables and the restructuring of the current debt burden. While management believes it is more likely than not we have the ability to continue as a going concern, this is dependent upon the ability to further implement the business plan, generate sufficient revenues and to control operating expenses.

Additionally, if necessary, based on our history of being able to raise capital from both internal and external sources coupled with current favorable market conditions, management believes that debt and/or equity financing can be obtained from both related parties (management and members of our Board of Directors) and external sources to pay down existing debt obligations, cover short term shortfalls, meet the shareholders equity requirements for Nasdaq, and complete proposed acquisitions. Although we believe in the viability of management’s strategy to generate sufficient revenue, control costs and the ability to raise additional funds if necessary, there can be no assurances to that effect. Therefore, the accompanying condensed consolidated financial statements have been prepared assuming that we will continue as a going concern.

COMPARISON OF YEARS ENDED DECEMBER 31, 2019 AND 2018

Revenues during the years ended December 31, 2019 and 2018 consisted of the following:

2019 2018
Telecom operations center $ 531,384 $ 476,237
Contractors and consultants 605,586 464,000
Compensation 452,759 191,005
Webhosting/internet 151,951 125,652
Professional services 433,003 483,018
Advertising and marketing 514,326 81,656
DRIP fees 547,000 -
Other 427,774 194,498
Total $ 3,663,783 $ 2,016,066

	2019		2018
Revenue	$	25,742,941	$	15,244,155
Cost of revenue		20,305,453		8,570,240
Gross profit	$	5,437,488	$	6,673,915

Revenue increased $10,498,786 (69%) primarily as a result of the addition of the ECS revenues of $10,766,995, an increase of $3,149,700 in Surge Blockchain LLC and $6,057,087 in Surge Logics LLC and a decrease of $7,381,300 in True Wireless, Inc. while gross profit decreased $1,236,427 (19%) primarily as a result of a decrease in gross profit of $4,674,196 in True Wireless, Inc that offset the gross profit gains from the increased revenues.

~~Total selling,~~Costs and expenses during the years ended December 31, 2019 and 2018 consisted of the following:

	2019		2018
Depreciation and amortization	$	227,322	$	149,642
Selling, general and administration		12,978,194		8,059,742
Total	$	13,205,516	$	8,209,384

Depreciation and amortization increased $77,680 primarily as a result of the addition of the ECS assets.

Selling, general and administrative ~~expense~~expenses during the years ended December 31, 2019 and 2018 consisted of the following:

	2019		2018
Telecom operations center	$	2,318,068	$	1,852,427
Contractors and consultants		2,134,202		1,177,371
Compensation		1,895,932		753,373
Webhosting/internet		651,370		819,255
Professional services		1,761,292		1,499,685
Advertising and marketing		1,116,046		559,333
Bad debt expense		985,633		-
DRIP fees		547,000		-
Other		1,568,651		1,398,298
Total	$	12,978,194	$	8,059,742

Selling, general and administrative costs (S,G & A) increased ~~$1,647,717 from $2,016,066~~by $4,918,452 (61%). The 2019 period includes $1,537,033 in expenses for the Surge companies that are not included in the 2018 ~~to $3,663,783 in 2019.~~expenses. The detail changes are discussed below:

●

Telecom operations center expenses increased from ~~$476,237~~$1,852,427 in 2018 to ~~$531,384~~$2,318,068 in 2019 primarily as a result of the contracting vendor providing additional services for Surge Blockchain, LLC.

●

Contractors and consultants increased to ~~$605,586~~$2,134,202 in 2019 from ~~$464,000~~$1,177,371 in ~~2018.~~2018 primarily due to outside IT services on the SurgePays portal. The 2019 period includes $375,113 in expenses of the Surge companies that are not included in the 2018 expenses.

●

Compensation increased from ~~$191,005~~$753,373 in 2018 to ~~$452,759~~$1,895,932 in 2019 primarily as a result of the ~~merger between~~increase in staff support positions to support the expected increase in revenue in the coming months. The 2019 period includes $365,807 in expense of the Surge ~~Holdings, Inc. and True Wireless, Inc.~~companies that are not included in the 2018 expenses.

●

Webhosting/internet costs ~~increased~~decreased to ~~$151,951~~$651,370 in 2019 from ~~$125,652~~$819,255 in 2018.

●

Professional services ~~decreased~~increased from ~~$483,018~~$1,499,685 in 2018 to ~~$433,003~~$1,761,292 in ~~2019.~~2019 primarily as a result of increased audit and legal fees.

●

Advertising and marketing costs increased to ~~$514,326~~$1,116,046 in 2019 from ~~$81,656~~$559,333 in 2018 primarily due to ~~the Company~~our implementing new advertising and marketing campaigns.

●

Bad debt expense increased to $985,633 in 2019 from $0 in 2018 primarily due to our evaluation of the receivables generated during the initial rollout of the SurgePays portal and providing an appropriate allowance for bad debts.

●

DRIP fees increased to $547,000 as a result of ~~the Company~~us entering into a Distributive Resolution & Integration Program (“DRIP”) with the Asian American Trade Association (“AATAC”) to provide products and services for up to 40,000 locations. The DRIP fees are a one-time location activation fee.

●

Other costs increased to ~~$427,774~~$1,568,651 in 2019 from ~~$194,498~~$1,398,298 in ~~2018.~~2018 primarily due to an increase in fidelity, cyber security and professional liability insurance required for the issuance of the SurgePays Visa debit card, shareholder communications and travel. The 2019 period includes ~~$168,378~~$267,595 in expenses of the Surge companies that are not included in the 2018 expenses.

Other (expense) income ~~(expense)~~ during the ~~three months~~years ended ~~June 30,~~December 31, 2019 and 2018 consisted of the following:

	2019			2018			2019			2018
Interest expense	$	(26,441	)	$	(79,892	)
Interest, net							$	(227,016	)	$	(140,457	)
Change in fair value of derivative liability		-			2,619			4,013			(4,105	)
Change in fair value of LTC cryptocurrency		-			(50,906	)		-			(95,387	)
Gain on equity investment in Centercom		42,809			-			25,192			-
Gain on settlement of liabilities		41,313			-
Gain on sale of assets								-			273,453
Gain (loss) on settlement of liabilities								(481,187	)		43,117
	$	57,681		$	(128,179	)	$	(678,998	)	$	76,621

Interest expense ~~decreased~~increased to ~~$26,441~~$227,016 in 2019 from ~~$79,892~~$140,457 in 2018 primarily due to ~~converting a $3,000,000 note payable to Series C convertible preferred stock~~an increase in ~~December 2018.~~total borrowings.

The change in fair value of LTC cryptocurrency decreased to $0 in 2019 from ~~$50,906 in 2018 due to the transfer of all assets and liabilities of Surge Cryptocurrency Mining to a third party under the sole control of Mr. Cox in December 2018.~~

~~The gain on equity investment in Centercom of $42,809 in 2019 is due to the 40% acquisition of Centercom in January 2019.~~

~~COMPARISON OF SIX MONTHS ENDED JUNE 30, 2019 AND 2018~~

~~Revenues during the six months ended June 30, 2019 and 2018 consisted of the following:~~

2019 2018
Revenue $ 7,393,194 $ 7,485,563
Cost of revenue 4,791,322 3,920,270
Gross profit $ 2,601,872 $ 3,565,293

~~Revenue decreased $92,369 (1.2%) while gross profit decreased $963,484 (27.0%) primarily as a result of reduced revenues in True Wireless, Inc.~~

~~Costs and expenses during the six months ended June 30, 2019 and 2018 consisted of the following:~~

2019 2018
Depreciation and amortization $ 21,124 $ 62,813
Selling, general and administration 6,224,564 3,286,151
Total $ 6,245,688 $ 3,348,964

~~Depreciation and amortization decreased $41,689 primarily as of the transfer of Surge Cryptocurrency Mining assets and liabilities to a third party under the sole control of Mr. Cox in December 2018.~~

Selling, general and administrative costs (S, G & A) increased $2,938,413 (89.4%) primarily as a result of the merger between Surge Holdings, Inc. and True Wireless, Inc. The S, G & A expenses of the Surge companies represent $1,537,033 of the expenses that are not included in the 2018 expenses.

~~Selling, general and administrative expenses during the six months ended June 30, 2019 and 2018 consisted of the following:~~

2019 2018
Telecom operations center $ 1,026,300 $ 926,237
Contractors and consultants 1,051,522 595,798
Compensation 818,567 244,988
Webhosting/internet 305,929 207,015
Professional services 851,471 879,925
Advertising and marketing 890,187 104,986
DRIP fees 547,000 -
Other 733,588 327,202
Total $ 6,224,564 $ 3,286,151

Total selling, general and administrative expense (S,G & A) increased $2,938,413 from $3,286,151 in 2018 to $6,224,564 in 2019. The 2019 period includes $1,537,033 in expenses for the Surge companies that are not included in the 2018 expenses. The detail changes are discussed below:

*	~~Telecom operations center expenses increased from $926,237 in 2018 to $1,026,300 in 2019 primarily as a result of the contracting vendor providing services for Surge Blockchain, LLC.~~
*	~~Contractors and consultants increased to $1,051,522 in 2019 from $595,798 in 2018. The 2019 period includes $375,113 in expenses of the Surge companies that are not included in the 2018 expenses.~~
*	~~Compensation increased from $244,988 in 2018 to $818,567 in 2019 primarily as a result of the merger between Surge Holdings, Inc. and True Wireless, Inc.~~
*	~~Webhosting/internet costs increased to $305,929 in 2019 from $207,015 in 2018.~~
*	~~Professional services decreased from $879,925 in 2018 to $851,471 in 2019.~~
*	~~Advertising and marketing costs increased to $890,187 in 2019 from $104,986 in 2018 primarily due to the Company implementing new advertising and marketing campaigns.~~
*	DRIP fees increased to $547,000 as a result of the Company entering into a Distributive Resolution & Integration Program (“DRIP”) with the Asian American Trade Association (“AATAC”) to provide products and services for up to 40,000 locations. The DRIP fees are a one-time location activation fee.
*	~~Other costs increased to $733,588 in 2019 from $327,202 in 2018. The 2019 period includes $168,378 in expenses of the Surge companies that are not included in the 2018 expenses.~~

~~Other income (expense) during the six months ended June 30, 2019 and 2018 consisted of the following:~~

2019 2018
Interest expense $ (72,390 ) $ (87,409 )
Change in fair value of derivative liability - 2,619
Change in fair value of LTC cryptocurrency - (50,906 )
Gain on equity investment in Centercom 64,775 -
Loss on settlement of liabilities (466,187 ) -
$ (473,802 ) $ (135,696 )

~~Interest expense decreased to $72,390 in 2019 from $87,409 in 2018 primarily due to converting a $3,000,000 note payable to Series C convertible preferred stock in December 2018.~~

~~The change in fair value of LTC cryptocurrency decreased to $0 in 2019 from $50,906~~$95,387 in 2018 due to the decrease in the market value of LTC cryptocurrency. In December 2018, ~~the Company~~we entered into an asset purchase agreement by which ~~the Company~~we transferred the assets and liabilities to a third party.

The gain on equity investment in Centercom of ~~$64,775~~$25,192 in 2019 is due to the 40% acquisition of Centercom in January 2019.

In December 2018, we sold all of its Cryptocurrency assets and recognized a gain on the sale totaling $273,453. See Note 6 to the Consolidated Financial Statements.

During the ~~six months~~year ended ~~June 30,~~December 31, 2019, ~~the Company~~we settled outstanding liabilities through the issuance of 875,000 shares of ~~common stock~~Common Stock and recorded a loss on settlement of ~~$507,00.~~$507,000. This amount was offset by a gain of $41,313 on the settlement of outstanding debt. During the year ended December 31, 2018, we settled outstanding liabilities through the issuance of 3,330,703 shares of Common Stock and recorded a gain on settlement of $43,117.

LIQUIDITY, CAPITAL RESOURCES AND GOING CONCERN

At ~~June 30,~~December 31, 2019 and ~~December 31,~~ 2018, our current assets were ~~$3,788,231~~$3,574,885 and $3,059,820, respectively, and our current liabilities were ~~$5,275,301~~$7,054,124 and $4,792,035, respectively, which resulted in a working capital deficit of ~~$1,487,070~~$3,479,239 and $1,732,215, respectively.

Total assets at ~~June 30,~~December 31, 2019 and ~~December 31,~~ 2018 amounted to ~~$5,248,301~~$9,986,373 and $4,084,318, respectively. At ~~June 30,~~December 31, 2019, assets consisted of current assets of ~~$3,788,231,~~$3,574,885, net property and equipment of ~~$28,191,~~$294,616, net intangible assets of ~~$46,943,~~$4,769,117, goodwill of $866,782, equity investment in Centercom of ~~$243,283~~$203,700, operating ~~least~~lease right of use asset of ~~$213,414~~$210,816 and other long-term assets of ~~$61,457,~~$66,457, as compared to current assets of $3,059,820, net property and equipment of $30,990, net intangible assets of $65,269, goodwill of $866,782 and other long-term assets of $61,457 at December 31, 2018.

At ~~June 30,~~December 31, 2019, our total liabilities of ~~$7,073,019~~$14,685,988 increased ~~$1,000,468~~$8,613,437 from $6,072,551 at December 31, 2018.

At ~~June 30,~~December 31, 2019, our total stockholders’ deficit was ~~$1,824,718~~$4,699,615 as compared to ~~total stockholders’ deficit of~~ $1,988,233 at December 31, 2018. The principal reason for the ~~decrease~~increase in stockholders’ deficit was the impact of the net loss of ~~$4,117,618~~$8,447,026 offset by ~~the~~ equity issuances during ~~the quarter.~~2019.

The following table sets forth the major sources and uses of cash for the ~~six months June 30,~~years ended December 31, 2019 and 2018.

2019 2018

Net cash provided by (used in) operating activities $ (3,291,628 ) $ 435,285
Net cash provided by investing activities - 243,768
Net cash provided by (used in) financing activities 4,285,473 (326,687 )
Net increase in cash and cash equivalents $ 993,845 $ 352,366

	2019			2018

Net cash used in operating activities	$	(6,533,141	)	$	(1,015,614	)
Net cash used in investing activities		(32,241	)		(278,035	)
Net cash provided by financing activities		6,466,810			464,101
Net change in cash and cash equivalents	$	(98,572	)	$	(829,548	)

At ~~June 30,~~December 31, 2019, ~~the Company~~we had the following material commitments and contingencies.

Notes payable – related party - See Note 89 to the Consolidated Financial Statements.

Notes payable and long-term debt - See Note 910 to the Consolidated Financial Statements.

Convertible promissory notes - See Note 11 to the Consolidated Financial Statements.

Advances from related party - See Note 1216 to the Consolidated Financial Statements.

Cash requirements and capital expenditures – At the current level of operations, ~~the Company has~~we had to borrow funds to meet basic operating costs. ~~The Company plans to use debt and equity financing to meet the cash requirements of the TW acquisition.~~

Known trends and uncertainties – ~~The Company is~~We are planning to acquire other businesses that are similar to its operations. The uncertainty of the economy may increase the difficulty of raising funds to support the planned business expansion.

Liquidity– ~~The Company~~We had a net loss ~~from operations~~ of approximately ~~$4.1~~$8.4 million for the ~~six months~~year ended ~~June 30,~~December 31, 2019. As of ~~June 30,~~December 31, 2019, we had cash and working capital deficit of approximately ~~$1.4 million~~$346,000 and ~~$1.5~~$3.5 million, respectively.

~~Management made a~~Management’s 2019 strategic decision to ~~expedite~~invest and allocate millions of dollars into software development, product development and its infrastructure has enabled us to be position for immediate rapid growth. We continue to add stores to the ECS and Wholesale Marketplace platforms while aggressively exploring new distribution channels and acquisitions. This is enabling the addition of products from manufacturers in market specific categories in conjunction with national rollouts of proprietary brands such as LocoRabbit Wireless, Max CBD and Essential products needed in ~~order~~today’s world.

The 3rd quarter asset purchase agreement of the ECS Business gives us access to ~~ramp up~~a network of over 9,800 retail locations and 160 independent salespeople processing over 18,000 transactions per day (see Note 1). ECS generates approximately $46,500,000 in annualized revenue inthrough third party wireless services.

During the year ended December 31, 2019, ~~and beyond. As part~~the Surge software development team has successfully implemented the merging of ~~this strategy, the Company rolled out~~ the SurgePays and ECS software ~~platform~~ to ~~the AATAC network of 40,000 retail locations. This includes placement orders of 250,000 Androids~~more efficiently and 500,000 Sim Starter kits over the course of the multi-phase rollout. The Company is in the first phase of the rollout, during which it expects to initially fulfil $2,800,000 in purchase orders of Androidscost effectively increase synergized revenue and ~~Sim Starter kits during Quarter 3.~~

profitability moving forward. In addition, management made the decision to expedite programming, software development and integration to enable tothe successful launch of the SurgePays Prepaid Visa ~~card~~card.

The development of the Surge Logistics Intake software and the infrastructure at Centercom BPO have enabled rapid scaling growth and evidenced in ~~Quarter 3.~~Surge Logics revenue trajectory.

To support the significant growth inflection, we have reorganized ~~our~~its human resources department, including building the administrative, legal and finance office in Bartlett, TN and the operations center in El Salvador ~~(which~~which will be able to now host 300 ~~employees). We believe the Company~~employees. Management believes we now ~~has~~have the ability to scale to support ~~this exponential~~its expected growth in 2020, which was a major goal for fiscal year 2019. During the year ended December 31, 2019, we were able to continue the utilization of the internal controls and operating procedures and techniques employed by our management in order to enhance the business by creating operating efficiencies and controlling costs. Lastly, wewse have significantly restructured ~~our~~its balance sheet to be an effective platform for growth as we continue to work towards listing on the Nasdaq Capital ~~Market.~~Market in the near term.

In March of 2020, the World Health Organization declared COVID-19 a pandemic. COVID-19 could disrupt the economy, our supply chain, and access to capital sources thus adversely affecting our ability to continue its operations. Management’s evaluation of the events and conditions and management’s plans regarding those matters are described in Note 3 to the consolidated financial statements.

These factors, among others, were addressed by management in determining whether ~~the Company~~we could continue as a going concern. ~~The Company projects~~We project that it should be cash flow positive by the end of ~~fiscal year 2019 from ongoing operations by the combination of~~Quarter 3 2020, through increased cash flow from ~~its current subsidiaries, as well as~~ongoing operations the collection of outstanding receivables and the restructuring ~~our~~of the current debt burden. The Company has executed an agreement with a FINRA licensed broker, as well as several institutional investors, to bring in equity investments to pay down existing debt obligations, cover short term shortfalls, meet the shareholders equity requirements for Nasdaq, and complete proposed acquisitions. While the Company believes in the viability of management’s strategy to generate sufficient revenue, control costs and the ability to raise additional funds if necessary, there can be no assurances to that effect. While management believes it is more likely than not ~~the Company has~~we have the ability to continue as a going concern, this is dependent upon the ability to further implement the business plan, generate sufficient revenues and to control operating expenses.

Additionally, if necessary, based on ~~the Company’s~~our history of being able to raise capital from both internal and external sources coupled with current favorable market conditions, management believes that debt and/or equity financing can be obtained from both related parties (management and members of the Board of Directors of the Company) and external ~~sources.~~sources to pay down existing debt obligations, cover short term shortfalls, meet the shareholders equity requirements for Nasdaq, and complete proposed acquisitions. Although we believe in the viability of management’s strategy to generate sufficient revenue, control costs and the ability to raise additional funds if necessary, there can be no assurances to that effect. Therefore, the accompanying consolidated financial statements have been prepared assuming that ~~the Company~~we will continue as a going ~~concern.~~concern

~~OFF-BALANCE SHEET ARRANGEMENTS~~

We do not have any off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

~~CRITICAL ACCOUNTING ESTIMATES~~

Our significant accounting policies are described in Note 2 of the Condensed Consolidated Financial Statements. During the six months ending June 30, 2019, we were not required to make any material estimates and assumptions that affect the reported amounts and related disclosures of assets, liabilities, revenue and expenses. However, if we complete an acquisition, we will be required to make estimates and assumptions typical of other companies. For example, we will be required to make critical accounting estimates related to valuation and accounting for business combinations. The estimates will require us to rely upon assumptions that were highly uncertain at the time the accounting estimates are made, and changes in them are reasonably likely to occur from period to period. Changes in estimates used in these and other items could have a material impact on our financial statements in the future. Our estimates will be based on our experience and our interpretation of economic, political, regulatory, and other factors that affect our business prospects. Actual results may differ significantly from our estimates.

~~BUSINESS~~Corporate Information

~~Business Overview~~We were

previously known as North American Energy Resources, Inc. (“NAER”) and KSIX Media Holdings, Inc. (“KSIX Media”). Prior to April 27, 2015, we operated solely as an independent oil and natural gas company engaged in the acquisition, exploration and development of oil and natural gas properties and the production of oil and natural gas through its wholly owned subsidiary, NAER. On April 27, 2015, NAER entered into a Share Exchange Agreement with KSIX Media whereby KSIX Media became a wholly-owned subsidiary of NAER and which resulted in the shareholders of KSIX Media owning approximately 90% of the voting stock of the surviving entity. While we continued the oil and gas operations of NAER following this transaction, on August 4, 2015, we changed our name to KSIX Media Holdings, Inc. On December 21, 2017, we changed our name to Surge Holdings, Inc. to better reflect the diversity of its business operations. We changed our name to SurgePays, Inc. on October 29, 2021.

The following summary consolidated statements of operations data for the years ended December 31, 2019 and 2018 have been derived from our audited consolidated financial statements included elsewhere in this prospectus. The summary consolidated statements of operations data for the nine months ended September 30, 2020 and 2019 and the consolidated balance sheets data as of September 30, 2020 are derived from our unaudited consolidated financial statements that are included elsewhere in this prospectus. The historical financial data presented below is not necessarily indicative of our financial results in future periods, and the results for the nine months ended September 30, 2020 are not necessarily indicative of our operating results to be expected for the full fiscal year ending December 31, 2020 or any other period. You should read the summary consolidated financial data in conjunction with those financial statements and the accompanying notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Our consolidated financial statements are prepared and presented in accordance with United States generally accepted accounting principles (“U.S. GAAP”). Our unaudited consolidated financial statements have been prepared on a basis consistent with our audited financial statements and include all adjustments, consisting of normal and recurring adjustments that we consider necessary for a fair presentation of the financial position and results of operations as of and for such periods.

Large-Accelerated Filer	[ ]	Accelerated Filer	[ ]
Non-Accelerated Filer	[X]	Smaller Reporting Company	[X]
		Emerging Growth Company	[ ]X]

Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price⁽¹⁾⁽³⁾		Amount of Registration Fee
Common Stock, par value $0.001 per share	$	⁽²⁾	$
Underwriter’s warrant to purchase Common Stock	$	⁽¹⁾
Common Stock issuable upon exercise of Underwriter’s warrants to purchase Common Stock	$	⁽²⁾	$
Total	$		$

(1)	~~Estimated~~No fee required pursuant to Rule 457(g) under the Securities Act.

(2)	The underwriter’s warrants are exercisable at a per share exercise price equal to 110% of the public offering price per share. As estimated solely for the purpose of calculating the registration fee ~~in accordance with~~pursuant to Rule ~~457(o)~~457(g) under the Securities Act, the proposed maximum aggregate offering price of ~~1933, as amended.~~

~~(2)~~	~~Includes~~the representative’s warrants is $ which is equal to 110% of $ (5% of $ shares of ~~the Common Stock which may be issued upon exercise of a 45-day option granted to the underwriters, to cover over-allotments, if any, equal to 15% of the number of shares of Common Stock~~common stock sold in the ~~offering.~~offering). Pursuant to Rule 416, the registrant is also registering an indeterminate number of additional shares of common stock that are issuable by reason of the anti-dilution provisions of the underwriter’s warrants.

(3)	~~Pursuant to Rule 416,~~The Registrant previously paid a registration fee of $1,393.80 in connection with the ~~securities being registered hereunder include such indeterminate number~~prior filing of ~~additional securities as may be issued after the date hereof as a result of stock splits, stock dividends or similar transactions.~~this Registration Statement.

	Per Share	Total
Public offering price	$	$
Underwriting discounts and commissions⁽¹⁾	$	$
Proceeds to us, before expenses	$	$

	Page
Prospectus Summary	1
Risk Factors	68
Use of Proceeds	1315
Market For Our Common Stock and Related Stockholder Matters	1416
Cautionary Note Regarding Forward-Looking Statements	1416
Capitalization	1517
Dilution	1518
Management’s Discussion and Analysis of Financial Condition and Results of Operations	1619
Business	2228
Directors and Executive Officers	2635
Executive Compensation	2939
Security Ownership of Certain Beneficial Owners and Management	3243
Certain Relationships and Related Party Transactions	3444
Description of Capital Stock	3647
Shares Eligible for Future Sale	4052
Material U.S. Federal Income Tax Considerations	4052
Underwriting	4657
Transfer Agent and Registrar	4865
Legal Matters	4865
Experts	4865
Where You Can Find More Information	4865
Index to Consolidated Financial Statements	5066

THE OFFERING

Securities offered by ~~us:~~us		of shares of Common Stock.

Offering Price		$ per share of Common Stock

Common Stock outstanding before the offering as of ~~September 11, 2019:~~February 10, 2021		~~97,534,983~~128,401,384 shares of Common Stock

Option to purchase additional shares of Common ~~Stock:~~Stock		We have granted the ~~underwriters~~underwriter a 45-day option to purchase up to additional shares of Common Stock at the public offering price as set forth on the cover of this prospectus, solely to cover over-allotments, if any.

Use of ~~proceeds:~~proceeds		We intend to use the net proceeds of this offering for the following purposes: working capital, retiring trade payables, marketing, development of product pipeline, technology development for our wireless services, legal fees, other corporate expenses, acquisitions of complementary products, product candidates, technologies or businesses, and repayment of loans (used for general corporate expenses).

		See “Use of Proceeds” section on page ~~13.~~15.

Risk factors:		Investing in our securities is highly speculative and involves a high degree of risk. You should carefully consider the information set forth in the “Risk Factors” section beginning on page 68 before deciding to invest in our securities.

Trading Symbol:		Our Common Stock is presently quoted on the OTCQB Marketplace under the symbol “SURG”.

Lock-up:		We and our directors, officers and principal stockholders have agreed with the ~~underwriters~~underwriter not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of our Common Stock or securities convertible into Common Stock for a period of 90 days after the date of this prospectus. See “Underwriting” section on page ~~56.~~57.

	As of June 30, 2019			Pro Forma⁽¹⁾
Assumed public offering price per share
Net tangible book deficit value per share as of June 30, 2019	$	(0.03	)	$
Increase in pro forma net tangible book value per share attributable to new investors	$
Pro forma net tangible book value per share after giving effect to this offering
Dilution in net tangible book value per share to new investors

	2019			2018

Net cash provided by (used in) operating activities	$	(3,291,628	)	$	435,285
Net cash provided by investing activities		-			243,768
Net cash provided by (used in) financing activities		4,285,473			(326,687	)
Net increase in cash and cash equivalents	$	993,845		$	352,366

THE OFFERING

Securities offered by us		of shares of Common Stock.

Offering Price		$ per share of Common Stock

Common Stock outstanding before the offering as of February 10, 2021		128,401,384 shares of Common Stock

Option to purchase additional shares of Common Stock		We have granted the underwriter a 45-day option to purchase up to additional shares of Common Stock at the public offering price as set forth on the cover of this prospectus, solely to cover over-allotments, if any.

Use of proceeds		We intend to use the net proceeds of this offering for the following purposes: working capital, retiring trade payables, marketing, development of product pipeline, technology development for our wireless services, legal fees, other corporate expenses, acquisitions of complementary products, product candidates, technologies or businesses, and repayment of loans (used for general corporate expenses).

		See “Use of Proceeds” section on page 15.

Risk factors:		Investing in our securities is highly speculative and involves a high degree of risk. You should carefully consider the information set forth in the “Risk Factors” section beginning on page 8 before deciding to invest in our securities.

Trading Symbol:		Our Common Stock is presently quoted on the OTCQB Marketplace under the symbol “SURG”.

Lock-up:		We and our directors, officers and principal stockholders have agreed with the underwriter not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of our Common Stock or securities convertible into Common Stock for a period of 90 days after the date of this prospectus. See “Underwriting” section on page 57.

	●	~~On-boarding~~our inability to raise additional capital to fund our operations, whether through the ~~SurgePays Portal into over 40,000 retail locations and subsequent ongoing white glove support;~~issuance of equity securities or debt;

	●	~~Aggressively marketing the Company’s new “Free Wireless Service” program~~our failure to ~~substantially grow customer base while enhancing customer service;~~successfully implement our business objectives;

	●	~~Supporting the Company’s IT infrastructure including database management; and~~compliance with ongoing regulatory requirements;

	●	~~Upselling-related FinTech products to~~market acceptance of our ~~existing customer base to increase revenue.~~products;

	●	changes in government regulations;

	●	general economic conditions and other external factors;

	●	actual or anticipated fluctuations in our quarterly financial and operating results; and

	●	the degree of trading liquidity in our shares of Common Stock.

	●	approximately $[ ] for the repayment of loans (used for general corporate expenses) that have the following interest rates and maturity date: a Line of Credit ($[ ]), notes payable and current portion of long-term debt ($[ ]), and long-term debt less current portion – related party ($[ ])

	●	approximately $[ ] for [ ];

	●	approximately $[ ] for [ ]; and

	●	the remainder for working capital and other general corporate purposes.

	4.
		Mr. Coy filed this action against the Company to enforce a Warrant to purchase 100,000 shares of Company Common Stock purportedly issued by the Company in November 2016. The Company has filed an answer which generally denies the allegations of the ComplaintJuno Financial v. AATAC and ~~a cross-complaint was filed by the Company suggesting that the Warrant is unenforceable. This matter is currently pending and the Company cannot predict its ultimate outcome.~~

	2)	~~Alan Massara~~v. Surge Holdings Inc. ~~et. al.~~~~, Eight Judicial District~~AND Surge Holdings Inc. v. AATAC; Circuit Court ~~Clark~~of Hillsborough County, ~~Nevada (unfiled).~~

		Mr. Massara presented the Company with a complaint seeking payment on a promissory note in the principal amount of $101,250 which was originally issued in satisfaction of certain obligations of the Company to him. In November 2018, the Company entered into a Settlement Agreement with Mr. Massara which provided for the payment by the Company of an initial payment of $21,250 followed by eight additional monthly payments of $10,000.Florida, Case # 20-CA-2712 DIV A:

Directors and Executive Officers	Position/Title	Age

Kevin Brian Cox	Chief Executive Officer and ~~Director~~Chairman	4345
Anthony P. Nuzzo, Jr.	President ~~Chief Operating Officer,~~ and Director	4952
~~David C. Ansani~~	~~Secretary, Chief Administrative Officer, and Director~~	54
~~Brian M. Speck~~Anthony Evers	Chief Financial Officer	4457
David C. Ansani	Chief Administrative Officer	55
Carter Matzinger	~~Director~~Chief Strategic Officer	4446
David N. Keys	Independent Director	6364

	●	been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

	●	had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time;

	●	been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity;

	●	been found by a court of competent jurisdiction in a civil action or by the ~~Securities and Exchange~~SEC Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;

	●	been the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

	Annual Compensation								Long-Term Compensation⁽³⁾
									Restricted		Securities
Name and							Other Annual		Stock		Underlying
Principal		Salary			Bonus		Compensation		Awards		Options		LTIP		All Other
Position	Year	($)⁽¹⁾			($)⁽²⁾		($)		($)		($)		Payouts		Compensation

Carter Matzinger⁽⁴⁾	2018	$	120,000	⁽⁵⁾	$	—	$	—	$	—	$	—	$	—	$	—
Former CEO and CFO and Current Director	2017	$	120,000	⁽⁶⁾	$	—	$	—	$	—	$	—	$	—	$	—

Kevin Brian Cox⁽⁴⁾	2018	$	—		$	—	$	—	$	—	$	—	$	—	$	—
CEO and Director	2017	$	—		$	—	$	—	$	—	$	—	$	—	$	—

David C. Ansani	2018	$	200,406	⁽⁵⁾	$	—	$	—	$	—	$	—	$	—	$	—
Secretary, Chief Administrative Officer and Director	2017	$	16,701	⁽⁶⁾	$	—	$	—	$	—	$	—	$	—	$	—

(2)		Salaries listed do not include annual bonuses to be paid based on profitability and performance. These bonuses will be set, from time to time, by a disinterested majority of our Board of Directors. No bonuses will be set until such time as the aforementioned occurs.

(3)		~~The Company plans on developing~~ We plan to adoptan ~~“Employee Stock Option~~Equity Incentive Plan (the “Incentive Plan” ~~(“ESOP”~~) for both management and strategic ~~consultants. However,~~consultants following the ~~Company does~~Offering and intends to seek stockholder approval of the Incentive Plan. The Incentive Plan is expected to include incentive stock options, non-qualified stock options, or stock bonuses. In addition, we anticipate executing long-term employment contracts with both senior management and strategic contractors , along with other members of the future management team, during the ~~2019~~2021 calendar year. It is anticipated these management agreements will contain compensation terms that could include a combination of cash salary, annual bonuses, insurance and related benefits, matching IRA contributions, restricted stock awards based upon longevity and management incentive stock options. ~~At the current time, the Company does not know the final structure of the ESOP or the proposed long-term management employment contracts.~~

(4)		Mr. ~~Matzinger resigned~~Evers joined us as ~~Chief Executive Officer and~~ Chief Financial Officer ~~in July 2017 and Mr. Cox became CEO and CFO on that same date. Mr. Cox resigned as CFO upon the appointment of Mr. Speck in March 2018.~~

~~(5)~~		~~Three quarters of which were reflected on the Company’s Statements of Operations for the year ended December 31, 2018 included in the Annual Report on Form 10-K filed by the Company on April~~effective May 1, ~~2019, due to the consolidation of the Company’s Statements of Operations with those of True Wireless, pursuant to the merger between the Company and True Wireless.~~

~~(6)~~		Not reflected on the Company’s Statements of Operations for the year ended December 31, 2017 included in the Annual Report on Form 10-K filed by the Company on April 10, 2018, due to reverse merger accounting related to the April 16, 2018 True Wireless transaction.2020

Title of Class	Name and Address of Beneficial Owner⁽¹⁾	Title of Beneficial Owner	Amount of Beneficial Ownership			% of Class⁽²⁾

Common	Anthony P. Nuzzo Jr. 1930 Thoreau Drive, Suite 100 Schaumberg, IL 60173	President, Chief Operating Officer and Director		20,500,000	⁽³⁾		17.74	%

Series C Preferred⁽⁴⁾				72,000			9.98	%

Common	Kevin Brian Cox	Chairman, Director, President and Chief Executive Officer		178,604,885	⁽⁵⁾		71.61	%

Series A Preferred⁽⁶⁾				10,500,000	⁽⁷⁾		80.77	%

Series C Preferred				603,364			83.62	%

Common	David C. Ansani 1930 Thoreau Drive Suite 100 Schaumburg, IL 60173	Secretary, Chief Administrative Officer, and Director		7,000	⁽⁸⁾		*

Common	Brian M. Speck	Chief Financial Officer		50,000	⁽⁹⁾		*

Common	Carter Matzinger	Director		12,519,000	⁽¹⁰⁾		11.44	%
	10624 S. Eastern, Suite A-910
	Henderson, NV 89052

Series A Preferred				2,500,000			19.23	%

Series C Preferred				46,232	⁽¹¹⁾		6.41	%

Common	David N. Keys	Director		852,155	⁽¹²⁾		*

Common	All Directors & Officers as a Group (6 persons)			212,533,040			76.10	%

Common	Sidney J. Lorio Jr. 2116 Parkwood Drive Bedford, TX 76021	5% Holder		8,277,252	⁽¹³⁾		8.44	%

Common	Edwin F. Winfield 1771 East Flamingo Road, Suite 206A Las Vegas, NV 89119	5% Holder		5,126,134	⁽¹⁴⁾		5.26	%

Name of Beneficial Owner⁽¹⁾	Total Common Stock Shares Beneficially Owned		% of Common Stock Class⁽²⁾			Total Series A Preferred Shares Owned⁽⁵⁾		% of Series A Class⁽²⁾			Total Series C Preferred Shares Owned⁽⁶⁾		% of Series C Class⁽²⁾			Total % of Beneficial Ownership⁽⁹⁾

Directors and Executive Officers:
Kevin Brian Cox ⁽³⁾		25,128,171		19.94	%		10,500,000		80.77	%		603,364		83.62	%		64.38	%
Anthony Evers ⁽¹⁰⁾		363,549		*			-		-			-		-			*
Anthony P. Nuzzo ⁽⁴⁾		2,500,000		1.98	%		-		-			72,000		9.98	%		4.70	%
David C. Ansani ⁽¹¹⁾		7,000		*													*
Carter Matzinger ⁽⁷⁾		566,000		*			2,500,000		19.23	%		46,232		6.41	%		8.51	%

All Directors and Executive Officers as a Group (5 persons)

5% Shareholders:
Sidney J. Lorio Jr. & Gloria D Lorio ⁽⁸⁾		8,309,398		6.59	%		-		-			-		-			2	%

(2)	Based on ~~97,534,983~~(i) 126,044,939 shares of ~~common stock~~Common Stock outstanding, (ii) 13,000,000 shares of Series A outstanding, and (iii) 721,596 shares of Series C outstanding as of ~~September 11, 2019.~~January 22, 2021.

(3)	Based on (i) 2,500,000 shares of common stock, including 1,600,000 shares owned by Anthony P. Nuzzo Jr. and 900,000 shares owned by BCAN Holdings, LLC, a Nevada limited liability company, of which Mr. Nuzzo is managing member; and (ii)~~shares of Series C Preferred Stock convertible into 18,000,000 shares of common stock.~~

~~(4)~~	~~Each share of Series C Preferred Stock is convertible into 250~~25,128,171 shares of Common ~~Stock. Series C Preferred~~ Stock, ~~is entitled to vote on an as-converted basis.~~

~~(5)~~	~~Based on (i) 26,713,885 shares of common stock,~~ including ~~21,000,000~~19,414,286 shares owned by Kevin Brian Cox, 4,813,885 shares owned by EWP Communications, LLC, a Tennessee liability company, of which Mr. Cox is a beneficial owner, and 900,000 shares owned by BCAN Holdings, LLC, a Nevada limited liability company, of which Mr. Cox is a beneficial owner; (ii) shares of Series A Preferred Stock convertible into ~~1,050,000~~105,000,000 shares of ~~common stock;~~Common Stock, including 75,000 shares of Series A Preferred Stock owned by EWP Communications, LLC, a Tennessee liability company, of which Mr. Cox is a beneficial owner.; and (iii) shares of Series C Preferred Stock convertible into 150,841,000 shares of ~~common stock.~~Common Stock.

~~(6)~~(4)	Based on (i) 2,500,000 shares of Common Stock, including 1,600,000 shares owned by Anthony P. Nuzzo Jr. and 900,000 shares owned by BCAN Holdings, LLC, a Nevada limited liability company, of which Mr. Nuzzo is managing member; and (ii) shares of Series C Preferred Stock convertible into 18,000,000 shares of Common Stock.

(5)	Each share of Series A Preferred Stock is entitled to vote ten (10) shares of Common Stock for each one (1) share of Series A Preferred Stock held and each 10 shares of Series A Preferred Stock is convertible into one share of Common Stock.

(6)	Each share of Series C Preferred Stock is convertible into 250 shares of Common Stock. Series C Preferred Stock is entitled to vote on an as-converted basis.

(7)	~~Includes 75,000 shares owned by EWP Communications, LLC, a Tennessee liability company, of which Mr. Cox is a beneficial owner.~~

~~(8)~~	~~Share are held in Mr. Ansani’s IRA.~~

~~(9)~~	~~Including50,000 warrants to purchase the Company’s common stock with an exercise price of $0.41 per share.~~

~~(10)~~	Based on (i)~~711,000~~ 566,000 shares of ~~common stock~~Common Stock owned by Thirteen Nevada, LLC, a Nevada limited liability company, of which Mr. Matzinger is a beneficial owner; (ii) shares of Series A Preferred Stock convertible into ~~250,000~~25,000,000 shares of ~~common stock;~~Common Stock; and (iii) shares of Series C Preferred Stock convertible into ~~10,000,000~~11,558,000 shares of ~~common stock.~~

~~(11)~~	~~Including~~Common Stock, including 6,232shares owned by Carter Matzinger, and40,000 shares owned by Thirteen Nevada, LLC, a Nevada limited liability company, of which Mr. Matzinger is a beneficial owner.

~~(12)~~	Includes 83,296 shares owned by the Connie L Keys Rollover IRA (Connie Keys, David N. Keys’ wife, is the sole trustee), 134,750 shares owned by the David N Keys Rollover IRA (Mr. Keys is the sole trustee), 134,109 shares owned by the David N Keys SEP IRA (Mr. Keys is the sole trustee), and 500,000 shares owned by PCC Holdings LLC. PCC Holdings LLC’s 100% member and Managing Member is GCK Holdings LLC. GCK Holdings LLC’s Managing Members are DNK Nevada Trust and CLK Nevada Trust of which David N. Keys shares voting and dispositive power.

~~(13)~~(8)	~~Including 567,857 warrants to purchase the Company’s common stock and 7,709,395 shares of common stock.~~With an address at: 2116 Parkwood Drive, Bedford, TX 76021.

~~(14)~~(9)	~~Includes 4,626,134~~Based on 436,443,939 shares ~~owned by Edwin F. Winfield and 500,000 shares owned by Vegas Media Group, Inc., a Nevada corporation, of which~~calculated on fully diluted basis.

(10)	Shares are held in Mr. ~~Winfield is a beneficial owner.~~ Evers’ IRA,

(11)	Shares are held in Mr. Ansani’s IRA.

	●	the amounts involved exceeded or will exceed the lesser of 1% of our total assets or $120,000; and

	●	any of our directors, executive officers or holders of more than 5% of our capital stock, or any member of the immediate family of the foregoing persons, had or will have a direct or indirect material interest.

	●	the director is, or at any time during the past three years was, an employee of the ~~company;~~Company;

	●	the director or a family member of the director accepted any compensation from the ~~company~~Company in excess of $120,000 during any period of 12 consecutive months within the three years preceding the independence determination (subject to certain exclusions, including, among other things, compensation for board or board committee service);

	●	a family member of the director is, or at any time during the past three years was, an executive officer of the ~~company;~~Company;

	●	the director ora family member of the director is a partner in, controlling stockholder of, or an executive officer of an entity to which the ~~company~~Company made, or from which the ~~company~~Company received, payments in the current or any of the past three fiscal years that exceed 5% of the recipient’s consolidated gross revenue for that year or $200,000, whichever is greater (subject to certain exclusions); or

	●	Ranks senior only to any other class or series of our designated and outstanding preferred ~~shares of the Company;~~shares;

	●	Bears no dividend;

	●	Has no liquidation preference, other than the ability to convert to ~~common stock~~Common Stock of the Company;

	●	The Company does not have any rights of redemption;

	●	Voting rights equal to ten shares of ~~common stock~~Common Stock for each share of Series ~~“A”~~A Preferred Stock;

	●	Entitled to same notice of meeting provisions as ~~common stock~~Common Stock holders;

	●	Protective provisions require approval of 75% of the Series ~~“A”~~A Preferred ~~Shares~~Stock outstanding to modify the provisions or increase the authorized Series ~~“A”~~A Preferred ~~Shares;~~Stock; and

	●	Each ten ~~Series “A”~~ Preferred ~~Shares~~Stock can be converted into one share of ~~common stock~~Common Stock at the option of the holder.

	●	Ranks junior only to any other class or series of designated and outstanding preferred ~~shares of the Company;~~shares;

	●	Bears a dividend per share of Series C Preferred Stock equal to the per share amount (as converted), and in the same form as, the dividend payable to the holders of the Common Stock;

	●	With respect to such liquidation, dissolution or winding up, the holders of Series C Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of Junior Securities but after distribution of such assets among, or payment thereof to holders of any Senior Preferred Stock, an amount equal to the Series C Original Issue Price for each share of Series C Preferred Stock plus an amount equal to all declared but unpaid dividends on Series C Preferred Stock;

	●	~~The Company does~~ We donot have any rights of redemption;

	●	Voting rights equal to 250 shares of ~~common stock~~Common Stock for each share of Series “C” Preferred Stock;

	●	Entitled to same notice of meeting provisions as ~~common stock~~Common Stock holders;

	●	Protective provisions require approval of 75% of the Series “C” Preferred Shares outstanding to modify the provisions or increase the authorized Series “C” Preferred Shares; and

	●	Each one Series “C” Preferred Share can be converted into two hundred fifty (250) shares of ~~common stock~~Common Stock at the option of the holder.

	(i)	The Volume Weighted Average Price (“VWAP”) of ~~the Company’s~~ Common Stock during any then consecutive trading days is at least $2.00 per share; or

	(ii)	June 30, 2019.

	~~June~~September 30, ~~2019~~2020
Risk-free interest rate		2.50	%
Expected life of grants		3 years
Expected volatility of underlying stock		168.71	%
Dividends		0	%

	December 31, 2018
Risk-free interest rate		2.03	%
Expected life of grants		1.5 years
Expected volatility of underlying stock		173.02	%
Dividends		0	%

	●	banks, insurance companies or other financial institutions;

	●	tax-exempt organizations or governmental organizations;

	●	regulated investment companies and real estate investment trusts;

	●	controlled foreign corporations, passive foreign investment companies and corporations that accumulate earnings to avoid U.S. federal income tax;

	●	brokers or dealers in securities or currencies;

	●	traders in securities that elect to use a mark-to-market method of accounting for their securities holdings;

	●	persons that own, or are deemed to own, more than five percent of our capital stock (except to the extent specifically set forth below);

	●	tax-qualified retirement plans;

	●	certain former citizens or long-term residents of the United States;

	●	partnerships or entities or arrangements classified as partnerships for U.S. federal income tax purposes and other pass-through entities (and investors therein);

	●	persons who hold our Common Stock or warrants as a position in a hedging transaction, “straddle,” “conversion transaction” or other risk reduction transaction or integrated investment;

	●	persons who hold or receive our Common Stock or warrants pursuant to the exercise of any employee stock option or otherwise as compensation;

	●	persons who do not hold our Common Stock or warrants as a capital asset within the meaning of Section 1221 of the Code; or

	●	persons deemed to sell our Common Stock or warrants under the constructive sale provisions of the Code.

	●	an individual citizen or resident of the United States;

	●	a corporation or other entity taxable as a corporation created or organized in the United States or under the laws of the United States, any State thereof or the District of Columbia;

	●	an estate whose income is subject to U.S. federal income tax regardless of its source; or

	●	a trust (x) whose administration is subject to the primary supervision of a U.S. court and which has one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code) who have the authority to control all substantial decisions of the trust or (y) which has made a valid election to be treated as a “United States person.”

	●	the gain is effectively connected with the non-U.S. ~~holder’s~~Holder’s conduct of a U.S. trade or business (and, if required by an applicable income tax treaty, the gain is attributable to a permanent establishment or fixed base maintained by the ~~non-U.S. holder~~Non-U.S. Holder in the United States);

	●	the ~~non-U.S. holder~~Non-U.S. Holder is a non-resident alien individual who is present in the United States for a period or periods aggregating 183 days or more during the calendar year in which the sale or disposition occurs and certain other conditions are met; or

	●	shares of our Common Stock or our warrants, as applicable, constitute U.S. real property interests by reason of our status as a “United States real property holding corporation” (a USRPHC) for U.S. federal income tax purposes at any time within the shorter of the five-year period preceding the non-U.S. ~~holder’s~~Holder’s disposition of, or the non-U.S. ~~holder’s~~Holder’s holding period for, our Common Stock or warrants, as applicable.

Underwriters	Number of Shares
Maxim Group LLC		~~Number of~~ ~~Shares~~

Total

Total					~~Paid by Surge~~ ~~Holdings, Inc.~~
		~~No Exercise~~Per Share		Without Option		~~Full Exercise~~With Option
~~Per share~~Public offering price	$		$		$
~~Total~~Underwriting discounts and commissions (7%)	$		$		$
Proceeds, before expenses, to us	$		$		$
Non-accountable expense allowance (1%) ⁽¹⁾	$		$		$


	●	~~Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specific maximum.~~

	●	Penalty bids permit the ~~underwriters~~underwriter to reclaim a selling concession from a syndicate member when the securities originally sold by the syndicate member ~~are~~is purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions.

	●	to fewer than 100 natural or legal persons (other than qualified investors within the meaning of Article 2(1)(e) of the Prospectus Directive) subject to obtaining the prior consent of us or any underwriter for any such offer; or

	Page

Report of Independent Registered Public Accounting Firm	F-1

Consolidated balance sheets as of December 31, ~~2018~~2019 and ~~2017~~2018	F-2

Consolidated statements of operations for the years ended December 31, ~~2018~~2019 and ~~2017~~2018	F-3

Consolidated statements of stockholders’ deficit for the years ended December 31, ~~2018~~2019 and ~~2017~~2018	F-4

Consolidated statements of cash flows for the years ended December 31, ~~2018~~2019 and ~~2017~~2018	F-5

Notes to consolidated financial statements	F-6

Condensed consolidated balance sheets as of ~~June~~September 30, ~~2019~~2020 (unaudited) and December 31, ~~2018~~2019	~~F-27~~F-33

Condensed consolidated statements of operations for the three and ~~six~~nine months ended ~~June~~September 30, 2020 and 2019 ~~and 2018~~ (unaudited)	~~F-28~~F-34

Condensed consolidated statement of stockholders’ deficit for the three and ~~six~~nine months ended ~~June~~September 30, ~~2019~~2020 (unaudited)	~~F-29~~F-35

Condensed consolidated statements of cash flows for the ~~six~~nine months ended ~~June~~September 30, 2020 and 2019 ~~and 2018~~ (unaudited)	~~F-31~~F-37

Notes to condensed consolidated financial statements (unaudited)	~~F-32~~F-38