UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended ~~April~~October 3031, 2023.

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

For the transition period from ____________ to ___________

Commission File Number 001-15687

DIGERATI TECHNOLOGIES, INC.

(Exact Name of Registrant as Specified in Its Charter)

Nevada		74-2849995
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

8023 Vantage Dr, Suite
660 San Antonio, Texas		78230
(Address of Principal Executive Offices)		(Zip Code)

(210) 614-7240

(Registrant’s Telephone Number, Including Area Code)

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
N/A		N/A		N/A

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

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

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

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

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

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practical date.

Number of Shares	Class:	As of:
160,331,685	Common Stock $0.001 par value	June 15, 2023
163,700,352	Common Stock $0.001 par value	December 22, 2023

DIGERATI TECHNOLOGIES, INC.

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED ~~APRIL~~OCTOBER 3031, 2023

INDEX

PART I — FINANCIAL INFORMATION
Item 1.	Consolidated Financial Statements (Unaudited)	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3433
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	4541
Item 4.	Controls and Procedures	4542
PART II — OTHER INFORMATION
Item 1.	Legal Proceedings	4643
Item 1A.	Risk Factors	4643
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	4643
Item 3.	Defaults Upon Senior Securities	4643
Item 4.	Mine Safety Disclosures	4643
Item 5.	Other Information	4643
Item 6.	Exhibits	4743
SIGNATURES		4944

DIGERATI TECHNOLOGIES, INC.

CONTENTS

PAGE 1		CONSOLIDATED BALANCE SHEETS AS OF ~~APRIL~~OCTOBER 3031, 2023 AND JULY 31, ~~2022~~2023 (UNAUDITED)
PAGE 2		CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE ~~AND NINE~~ MONTHS ENDED ~~APRIL~~OCTOBER 3031, 2023 AND 2022 (UNAUDITED)
PAGE 3-4		CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT FOR THE THREE ~~AND NINE~~ MONTHS ENDED ~~APRIL~~OCTOBER 3031, 2023 AND 2022 (UNAUDITED)
PAGE 5		CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE ~~NINE~~THREE MONTHS ENDED ~~APRIL~~OCTOBER 3031, 2023 AND 2022 (UNAUDITED)
PAGES 6-33		NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
PAGES 6-32		NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

PART 1. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

DIGERATI TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands, unaudited)

	April 30,			July 31,
	October 31,			July 31,
	2023			~~2022~~2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	~~997~~946		$	~~1,509~~924
Accounts receivable, net		906			~~622~~749
Prepaid and other current assets		~~578~~686			~~383~~650
Total current assets		2,~~481~~538			2,~~514~~323
LONG-TERM ASSETS:
Intangible assets, net		1211,~~925~~721			1512,~~188~~211
Goodwill		19,380			19,380
Property and equipment, net		1,~~465~~249			1,~~647~~346
Other assets		~~554~~464			~~273~~437
Investment in Itellum		185			185
Right-of-use assets - financing		512			62
Right-of-Use assets - financing		1,100			578
Right-of-use assets - operating		1,886			2,436
Right-of-Use assets - operating		1,730			1,912
Total assets	$	3938,~~388~~367		$	4138,~~685~~372
LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES:
Accounts payable	$	43,~~134~~798		$	35,~~222~~373
Accrued liabilities		910,~~481~~780			9,~~627~~877
Equipment financing		~~196~~245			21228
Convertible note payable, current, net of discount of $1,851 and $120, respectively		7,431			3,948
Convertible note payable, current, net of discount of $293 and $960, respectively		8,918			8,216
Note payable, current, related party, net of discount of $10 and $40, respectively		490			833
Note payable, current, related party		500			500
Note payable, current, net of discount of $168 and $181, respectively		35,533			870
Note payable, current, net of discount of $30 and $60, respectively		40,150			36,497
Acquisition payable		1,000			1,000
Deferred income		1,~~277~~100			~~931~~1,124
Derivative liability		74,~~759~~738			104,~~588~~125
Operating lease liability, current		~~609~~630			~~797~~662
Total current liabilities		6771,~~910~~859			3167,~~837~~602
LONG-TERM LIABILITIES:
Note payable, net of discount $0 and $313, respectively		-			33,335
Equipment financing		731			354
Convertible note payable		-			500
Operating lease liability, net of current portion		1,170			1,320
Equipment financing		320			43
Total long-term liabilities		1,901			1,674
Operating lease liability, net of current portion		1,402			1,788
Total liabilities		73,760			69,276
Total long-term liabilities		1,722			35,666
Total liabilities		69,632			67,503
Commitments and contingencies
STOCKHOLDERS’ DEFICIT:
Preferred stock, $0.001, 50,000,000 shares authorized
Convertible Series A Preferred stock, $0.001, 1,500,000 shares designated, 25,000 and 225,000 issued and outstanding, respectively		-			-
Convertible Series A Preferred stock, $0.001, 1,500,000 shares designated, 0 issued and outstanding, respectively		-			-
Convertible Series B Preferred stock, $0.001, 1,000,000 shares designated, 425,442 and 425,442 issued and outstanding, respectively		-			-
Convertible Series C Preferred stock, $0.001, 1,000,000 shares designated, 55,400 and 55,400 issued and outstanding, respectively		-			-
Series F Super Voting Preferred stock, $0.001, 100 shares designated, 100 and 100 issued and outstanding, respectively		-			-
Common stock, $0.001, 500,000,000 shares authorized, 158,438,352 and 142,088,039 issued and outstanding (86,000,000 and 45,000,000, respectively, reserved in Treasury)		158			142
Common stock, $0.001, 500,000,000 shares authorized, 161,921,685 and 160,931,685 issued and outstanding (110,000,000 and 109,000,000, respectively, reserved in Treasury)		162			161
Additional paid in capital		9293,~~947~~908			8993,~~487~~911
Accumulated deficit		(~~120~~125,~~397~~769	)		(~~113~~121,~~393~~684	)
Other comprehensive income		1			1
Total Digerati’s stockholders’ deficit		(2731,~~291~~698	)		(2327,~~763~~611	)
Noncontrolling interest		(23,~~953~~695	)		(23,~~055~~293	)
Total stockholders’ deficit		(3035,~~244~~393	)		(2530,~~818~~904	)
Total liabilities and stockholders’ deficit	$	3938,~~388~~367		$	4138,~~685~~372

See accompanying notes to unaudited consolidated financial statements

DIGERATI TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts, unaudited)

	Three Months Ended April 30,						Nine Months Ended April 30,
	Three Months Ended October 31,
	2023			2022			~~2023~~			~~2022~~
OPERATING REVENUES:
Cloud software and service revenue	$	7,~~837~~654		$	8,~~163~~130		$	~~23,908~~		$	~~15,959~~
Total operating revenues		7,~~837~~654			8,~~163~~130			~~23,908~~			~~15,959~~
OPERATING EXPENSES:
Cost of services (exclusive of depreciation and amortization)		2,~~879~~551			32,~~161~~851			~~8,698~~			~~6,203~~
Selling, general and administrative expense		4,~~322~~189			4,~~296~~141			~~12,921~~			~~8,211~~
Legal and professional fees		~~681~~973			~~756~~556			~~2,311~~			~~2,505~~
Bad debt expense		3757			3629			~~106~~			51
Depreciation and amortization expense		~~993~~683			~~1,540~~953			~~2,912~~			~~2,514~~
Total operating expenses		8,~~912~~453			98,~~789~~530			~~26,948~~			~~19,484~~
OPERATING LOSS		(~~1,075~~799	)		(~~1,626~~400	)		~~(3,040~~	)		~~(3,525~~	)
OTHER INCOME (EXPENSE):
Gain (loss) on derivative instruments		2,120			6,827			2,893			7,835
Loss on derivative instruments		(612	)		(3,076	)
Gain (loss) on extinguishment of debt		55			-			55			(5,480	)
Other income		-			446
Other income (expense)		(1	)		2			455			-
Interest expense		(3,041	)		(2,065	)
Interest expense		(3,701	)		(1,676	)		(8,137	)		(4,563	)
Income tax expense		(28	)		(50	)
Income tax expense		(51	)		(167	)		(128	)		(285	)
Total other income (expense)		(3,681	)		(4,745	)
Total other income (expense)		(1,578	)		4,986			(4,862	)		(2,493	)
NET LOSS		(4,480	)		(5,145	)
NET INCOME (LOSS) INCLUDING NONCONTROLLING INTEREST		(2,653	)		3,360			(7,902	)		(6,018	)
Less: Net loss attributable to the noncontrolling interests		395			161
Less: Net loss attributable to the noncontrolling interests		409			546			898			1,306
NET LOSS ATTRIBUTABLE TO DIGERATI’S SHAREHOLDERS		(4,085	)		(4,984	)
NET INCOME (LOSS) ATTRIBUTABLE TO DIGERATI'S SHAREHOLDERS		(2,244	)		3,906			(7,004	)		(4,712	)
Deemed dividend on Series A Convertible preferred stock		-			(4	)
Deemed dividend on Series A Convertible preferred stock		-			(4	)		(8	)		(14	)
NET LOSS ATTRIBUTABLE TO DIGERATI’S COMMON SHAREHOLDERS	$	(4,085	)	$	(4,988	)
NET INCOME (LOSS) ATTRIBUTABLE TO DIGERATI'S COMMON SHAREHOLDERS	$	(2,244	)	$	3,902		$	(7,012	)	$	(4,726	)
LOSS PER COMMON SHARE - BASIC AND DILUTED	$	(0.03	)	$	(0.03	)
INCOME (LOSS) PER COMMON SHARE - BASIC	$	(0.01	)	$	0.03		$	(0.05	)	$	(0.03	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC AND DILUTED		161,530,037			143,067,151
LOSS PER COMMON SHARE - DILUTED	$	(0.01	)	$	(0.01	)	$	(0.05	)	$	(0.03	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC		153,785,787			139,751,107			148,462,169			139,285,833
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - DILUTED		153,785,787			254,167,793			148,462,169			139,285,833

See accompanying notes to unaudited consolidated financial statements

DIGERATI TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS'’ DEFICIT

~~For~~FOR ~~the~~THE ~~Nine~~THREE ~~Months~~MONTHS ~~Ended~~ENDED ~~April~~OCTOBER 3031, 2023

(In thousands, except for share amounts, unaudited)

	Equity Digerati's Shareholders
	Equity Digerati’s Shareholders
	Preferred
	Convertible																	Common				Additional						Other
	Series A Shares			Par		Series B Shares		Par		Series C Shares		Par		Series F Shares		Par		Shares		Par		Paid-in Capital			Accumulated Deficit			Comprehensive Income		Stockholders Equity			Noncontrolling Interest			Totals
	SeriesA Shares			Par		Series B Shares		Par		Series C Shares		Par		Series F Shares		Par		Shares		Par		Paid-in Capital			Accumulated Deficit			Comprehensive Income		Stockholders Equity			Noncontrolling Interest			Totals
BALANCE, July 31, 2022		225,000			-		425,442		-		55,400		-		100		-		142,088,039	$	142	$	89,487		$	(113,393	)	$	1	$	(23,763	)	$	(2,055	)	$	(25,818	)
BALANCE, July 31, 2023		-			-		425,442		-		55,400		-		100		-		160,931,685	$	161	$	93,911		$	(121,684	)	$	1	$	(27,611	)	$	(3,293	)	$	(30,904	)
Amortization of employee stock options		-			-		-		-		-		-		-		-		-		-		23			-			-		23			-			23
Stock option expense		-			-		-		-		-		-		-		-		-		-		12			-			-		12			-			12
Common stock issued for conversion of Convertible Series A Preferred stock		(25,000	)		-		-		-		-		-		-		-		105,723		-		7			-			-		7			-			7
Common stock issued for debt extension		-			-		-		-		-		-		-		-		990,000		1		41			-			-		42			-			42
Common stock issued for exercise of warrants		-			-		-		-		-		-		-		-		160,628		-		21			-			-		21			-			21
Reversal of beneficial conversion feature		-			-		-		-		-		-		-		-		-		-		(56	)		-			-		(56	)		(7	)		(63	)
Common stock issued for debt extension		-			-		-		-		-		-		-		-		2,060,000		2		247			-			-		249			-			249
Net loss		-			-		-		-		-		-		-		-		-		-		-			(4,085	)		-		(4,085	)		(395	)		(4,480	)
Common stock issued concurrent with convertible debt		-			-		-		-		-		-		-		-		650,000		1		94			-			-		95			-			95
BALANCE, October 31, 2023		-			-		425,442		-		55,400		-		100		-		161,921,685	$	162	$	93,908		$	(125,769	)	$	1	$	(31,698	)	$	(3,695	)	$	(35,393	)
Dividends accrued		-			-		-		-		-		-		-		-		-		-		(4	)		-			-		(4	)		-			(4	)
Net Loss		-			-		-		-		-		-		-		-		-		-		-			(4,984	)		-		(4,984	)		(161	)		(5,145	)
BALANCE, October 31, 2022		200,000			-		425,442		-		55,400		-		100		-		145,064,390		145	$	89,875		$	(118,377	)	$	1	$	(28,356	)	$	(2,216	)	$	(30,572	)
Amortization of employee stock options		-			-		-		-		-		-		-		-		-		-		23			-			-		23			-			23
Common stock issued for conversion of Convertible Series A Preferred stock		(175,000	)		-		-		-		-		-		-		-		749,327		1		49			-			-		50			-			50
Common stock issued for exercise of warrants		-			-		-		-		-		-		-		-		9,677		-		1			-			-		1			-			1
Common stock issued for debt extension		-			-		-		-		-		-		-		-		1,000,000		1		90			-			-		91			-			91
Common stock issued for debt conversion and settlement		-			-		-		-		-		-		-		-		1,500,000		1		74			-			-		75			-			75
Common stock issued concurrent with convertible debt		-			-		-		-		-		-		-		-		4,164,907		4		256			-			-		260			-			260
Dividends accrued		-			-		-		-		-		-		-		-		-		-		(4	)		-			-		(4	)		-			(4	)
Warrant issued with debt - debt discount		-			-		-		-		-		-		-		-		-		-		667			-			-		667			-			667
Beneficial conversion feature on convertible debt - debt discount		-			-		-		-		-		-		-		-		-		-		1,275			-			-		1,275			-			1,275
Net Loss		-			-		-		-		-		-		-		-		-		-		-			224			-		224			(328	)		(104	)
BALANCE, January 31, 2023		25,000			-		425,442		-		55,400		-		100		-		152,488,301	$	152	$	92,306		$	(118,153	)	$	1	$	(25,694	)	$	(2,544	)	$	(28,238	)
Amortization of employee stock options		-			-		-		-		-		-		-		-		-		-		35			-			-		35			-			35
Common stock issued to employees		-			-		-		-		-		-		-		-		1,370,551		1		(1	)		-			-		-			-			-
Common stock issued for debt extension		-			-		-		-		-		-		-		-		2,180,000		2		163			-			-		165			-			165
Common stock issued for debt conversion and settlement		-			-		-		-		-		-		-		-		1,500,000		2		74			-			-		76			-			76
Common stock issued concurrent with convertible debt		-			-		-		-		-		-		-		-		899,500		1		74			-			-		75			-			75
Warrant issued with debt - debt discount		-			-		-		-		-		-		-		-		-		-		170			-			-		170			-			170
Beneficial conversion feature on convertible debt - debt discount		-			-		-		-		-		-		-		-		-		-		126			-			-		126			-			126
Net loss		-			-		-		-		-		-		-		-		-		-		-			(2,244	)		-		(2,244	)		(409	)		(2,653	)
BALANCE, April 30, 2023		25,000			-		425,442		-		55,400		-		100		-		158,438,352	$	158	$	92,947		$	(120,397	)	$	1	$	(27,291	)	$	(2,953	)	$	(30,244	)

See accompanying notes to unaudited consolidated financial statements

DIGERATI TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS'’ DEFICIT

~~For~~FOR ~~the~~THE ~~Nine~~THREE ~~Months~~MONTHS ~~Ended~~ENDED ~~April~~OCTOBER 3031, 2022

(In thousands, except for share amounts, unaudited)

	Equity Digerati's Shareholders
	Equity Digerati’s Shareholders
	Preferred
	Convertible																	Common				Additional						Other
	Series A Shares			Par		Series B Shares		Par		Series C Shares		Par		Series F Shares		Par		Shares		Par		Paid-in Capital			Accumulated Deficit			Comprehensive Income		Stockholders Equity			Noncontrolling Interest			Totals
BALANCE, July 31, 2021		225,000			-		425,442		-		55,400		-		100		-		138,538,039	$	139	$	89,100		$	(105,380	)	$	1	$	(16,140	)	$	(714	)	$	(16,854	)
BALANCE, July 31, 2022		225,000			-		425,442		-		55,400		-		100		-		142,088,039	$	142	$	89,487		$	(113,393	)	$	1	$	(23,763	)	$	(2,055	)	$	(25,818	)
Amortization of employee stock options		-			-		-		-		-		-		-		-		-		-		24			-			-		24			-			24
Stock option expense		-			-		-		-		-		-		-		-		-		-		23			-			-		23			-			23
Common stock issued concurrent with convertible debt		-			-		-		-		-		-		-		-		600,000		-		38			-			-		38			-			38
Common stock issued for conversion of Convertible Series A Preferred stock		(25,000	)		-		-		-		-		-		-		-		105,723		-		7			-			-		7			-			7
Dividends accrued		-			-		-		-		-		-		-		-		-		-		(5	)		-			-		(5	)		-			(5	)
Common stock issued for exercise of warrants		-			-		-		-		-		-		-		-		160,628		-		21			-			-		21			-			21
Net Loss		-			-		-		-		-		-		-		-		-		-		-			2,424			-		2,424			(158	)		2,266
Common stock issued for debt extension		-			-		-		-		-		-		-		-		2,060,000		2		247			-			-		249			-			249
BALANCE, October 31, 2021		225,000			-		425,442		-		55,400		-		100		-		139,138,039	$	139	$	89,157		$	(102,956	)	$	1	$	(13,659	)	$	(872	)	$	(14,531	)
Common stock issued concurrent with convertible debt		-			-		-		-		-		-		-		-		650,000		1		94			-			-		95			-			95
Amortization of employee stock options		-			-		-		-		-		-		-		-		-		-		23			-			-		23			-			23
Common stock issued concurrent with convertible debt		-			-		-		-		-		-		-		-		600,000		-		-			-			-		-			-			-
Dividends accrued		-			-		-		-		-		-		-		-		-		-		(5	)		-			-		(5	)		-			(5	)
Net Loss		-			-		-		-		-		-		-		-		-		-		-			(11,042	)		-		(11,042	)		(602	)		(11,644	)
BALANCE, January 31, 2022		225,000			-		425,442		-		55,400		-		100		-		139,738,039	$	139	$	89,175		$	(113,998	)	$	1	$	(24,683	)	$	(1,474	)	$	(26,157	)
Amortization of employee stock options		-			-		-		-		-		-		-		-		-		-		28			-			-		28			-			28
Common stock issued for debt extension		-			-		-		-		-		-		-		-		250,000		-		34			-			-		34			-			34
Derivative liability resolved to APIC due to note conversion		-			-		-		-		-		-		-		-		-		-		76			-			-		76			-			76
Dividends accrued		-			-		-		-		-		-		-		-		-		-		(4	)		-			-		(4	)		-			(4	)
Net Loss		-			-		-		-		-		-		-		-		-		-		-			3,906			-		3,906			(546	)		3,360
Net loss		-			-		-		-		-		-		-		-		-		-		-			(4,984	)		-		(4,984	)		(161	)		(5,145	)
BALANCE, April 30, 2022		225,000			-		425,442		-		55,400		-		100		-		139,988,039	$	139	$	89,309		$	(110,092	)	$	1	$	(20,643	)	$	(2,020	)	$	(22,663	)
BALANCE, October 31, 2022		200,000			-		425,442		-		55,400		-		100		-		145,064,390	$	145	$	89,875		$	(118,377	)	$	1	$	(28,356	)	$	(2,216	)	$	(30,572	)

See accompanying notes to unaudited consolidated financial statements

DIGERATI TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands, unaudited)

	Nine Months April 30,
	Three Months Ended October 31,
	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(74,~~902~~480	)	$	(65,~~018~~145	)
Adjustments to reconcile net loss to cash (used in)/provided by operating activities:
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization expense		~~2,912~~683			~~2,514~~953
Stock compensation and warrant expense		8112			7523
Bad debt expense		~~106~~57			5129
Amortization of Right-of-Use Assets		624			214
Non-cash lease expense		218			267
Amortization of debt discount		~~2,104~~697			~~1,943~~204
(Gain) loss on derivative liabilities		(2,893	)		(7,835	)
Loss on derivative liabilities		612			3,076
(Gain) loss on extinguishment of debt		(55	)		5,480
(Gain) on settlement of conversion premium on Notes		-			(466	)
(Gain) on settlement of conversion premium on Notes		(466	)		-
Debt extension fee charged to interest expense		-			303
Accrued interest added to principal		-			-
Common stock issued for debt extension charged to interest expense		42			249
Debt extension fee charged to interest expense		689			155
Common stock issued for debt extension charged to interest expense		505			34
Changes in operating assets and liabilities:
Accounts receivable		(~~390~~214	)		(~~433~~251	)
Prepaid expenses and other current assets		(~~213~~36	)		(96266	)
Inventory		18			10
Other assets		(27	)		(74	)
Other assets		(281	)		23
Right of use operating lease liability		(182	)		(280	)
Right of use operating lease liability		(574	)		(268	)
Accounts payable		(1,575	)		442
Accounts payable		883			1,385
Accrued expenses		4,499			(110	)
Accrued expenses		1,406			1,003
Deferred income		(24	)		188
Deferred income		346			22
Net cash provided by (used in) operating activities		282			(858	)
Net cash used in operating activities		(3,100	)		(1,741	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid in acquisition of equipment		(~~467~~96	)		(~~193~~108	)
Proceeds from Nexogy		-			178
Net cash used in investing activities		(96	)		(108	)
Acquisition of VoIP assets, net of cash received		-			(12,790	)
Net cash used in investing activities		(467	)		(12,805	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings from convertible debt, net of original issuance cost and discounts		~~4,491~~-			~~706~~957
Borrowings from debt, net of original issuance cost and discounts		-			15,530
Proceeds from the exercise of warrants		-			21
Proceeds from the exercise of warrants		22			-
Borrowings from related party notes, net of original issuance cost and discounts		-			150
Borrowings from related party notes, net of original issuance cost and discounts		250			-
Principal payments on convertible debt, net		-			(250	)
Principal payments on debt, net		(548	)		-
Principal payments on related party notes, net		-			(367	)
Principal payments on convertible debt, net		(520	)		(175	)
Principal payment on equipment financing		(164	)		(6	)
Principal payments on related party notes, net		(568	)		(590	)
Net cash (used in) provided by financing activities		(164	)		505
Principal payment on equipment financing		(72	)		(30	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		22			(461	)
Net cash provided by financing activities		3,055			15,441
CASH AND CASH EQUIVALENTS, beginning of period		924			1,509
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(512	)		895
CASH AND CASH EQUIVALENTS, end of period	$	946		$	1,048
CASH AND CASH EQUIVALENTS, beginning of period		1,509			1,489
CASH AND CASH EQUIVALENTS, end of period	$	997		$	2,384
SUPPLEMENTAL DISCLOSURES:
Cash paid for interest	$	~~2,995~~21		$	~~1,677~~905
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Accrued interest rolled into principal	$	13,~~503~~653		$	~~640~~365
Incentive earnout adjustment on Active PBX acquisition	$	-		$	120
Debt discount from common stock issued with debt	$	-		$	95
Debt discount from common stock issued with debt	$	430		$	38
Common Stock issued for the conversion of Preferred Stock Series A	$	-		$	7
Derivative liability resolved to APIC	$	-		$	76
Dividends accrued	$	-		$	4
Debt discount from derivative liabilities	$	64		$	60
Right-of-use Assets recognized from operating and finance leases	$	558		$	-
Debt discount from warrants issued with debt	$	837		$	-
Beneficial conversion feature on convertible note	$	1,401		$	-
Common stock issued for debt conversion and settlement	$	151		$	-
Common Stock issued for the conversion of Preferred Stock Series A	$	57		$	-
Dividends accrued	$	8		$	14
Day 1 (one) recognition of Right-of-use Assets	$	524		$	-

See accompanying notes to unaudited consolidated financial statements

DIGERATI TECHNOLOGIES, INC., AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 – BASIS OF PRESENTATION

Description of Business

Unless otherwise indicated or the context otherwise requires, references in this subsection to “we,” “us,”, “our,” “the Company,” and other similar terms refer to Digerati and its subsidiaries.

Digerati Technologies, Inc., a Nevada corporation (including our subsidiaries, “we,” “us,” “Company” or “Digerati”), through its operating subsidiaries, in(i) Verve Cloud, Inc. (formerly known as T3 communications, Inc.), a Nevada corporation (“Verve Cloud Nevada”), (ii) Verve Cloud, Inc. (formerly known as Shift8 Networks, Inc.), a Texas corporation (“Verve Cloud Texas”), (iii) T3 Communications, Inc., a Florida corporation (“T3 Communications”), (iv) Nexogy, Inc., a Florida corporation (“Nexogy”) and (v) NextLevel Internet, Inc., a California corporation (“Next Level” and, together with Verve Cloud Nevada, Verve Cloud Texas, T3 Communications and Nexogy, the “Operating Subsidiaries”), which, as of June 1, 2023, operate as a single business unit under the Verve Cloud name and have locations in Texas, Florida and California, provides cloud services specializing in Unified Communications as a Service (“UCaaS”) and broadband connectivity solutions for the business market. ~~Digerati’s~~ Our product line includes a portfolio of Internet-based telephony products and services delivered through ~~its~~our cloud application platform and session-based communication network and network services including Internet broadband, fiber, mobile broadband, and cloud Wide Area Network (“WAN”) ~~solutions~~or Software-defined Wide Area Network (“SD WAN”) solutions.

Digerati provides ~~Technologies~~enterprise-class, ~~Inc.~~carrier-grade ~~currently~~services ~~has~~to ~~four (4)~~the ~~operating~~small-to-medium-sized ~~subsidiaries:~~business (i“SMB”) ~~Verve~~at ~~Cloud,~~cost-effective ~~Inc~~monthly rates., aDigerati’s ~~Texas~~UCaaS ~~entity~~or ~~(this~~cloud ~~entity~~communication ~~was~~services ~~formerly~~include ~~known~~fully ashosted ~~Shift8~~Internet ~~Networks,~~Protocol ~~Inc.);~~ (ii“IP”)/private ~~T3 Communications,~~branch ~~Inc.,~~exchange ~~a Florida entity;~~ (~~iii~~“PBX”), ~~Nexogy~~video conferencing, ~~Inc.~~mobile applications, aVoice ~~Florida~~over ~~entity;~~Internet ~~and~~Protocol (iv“VoIP”) ~~NextLevel Internet~~transport, ~~Inc., a California entity. Each of these entities~~Session isInitiation aProtocol ~~subsidiary of Verve Cloud, Inc., a Nevada entity~~ (~~this entity was formerly known as T3 Communications, Inc.~~“SIP”) ~~formed on March 27~~trunking, ~~2023.~~ Weand ~~expect~~customized ~~the~~VoIP ~~completion~~services toall bedelivered ~~consolidated~~Only ~~under~~in ~~one single entity during~~ the ~~quarter ending June 30, 2023~~Cloud™.

~~Digerati~~Basis provides enterprise-class, carrier-grade services to the small-to-medium-sized business (“SMB”) at cost-effective monthly rates. Digerati’s UCaaS or cloud communication services include fully hosted IP/PBX, video conferencing, mobile applications, Voice over Internet Protocol (“VoIP”) transport, SIP trunking, and customized VoIP services all delivered Only in the Cloud™. Digerati’s broadband connectivity solutions for the delivery of ~~digital~~presentation ~~oxygen are designed for reliability, business continuity~~ and ~~to optimize bandwidth for businesses using Digerati’s cloud communication services and other cloud-based applications.~~consolidation

~~Basis~~The accompanying unaudited interim consolidated financial statements of Digerati Technologies, Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the United States Securities and Exchange Commission. In the opinion of management, these interim financial statements contain all adjustments, consisting of normal recurring adjustments necessary for a fair presentation of financial position and ~~consolidation~~the results of operations for the interim periods presented. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the consolidated financial statements, which would substantially duplicate the disclosure contained in the audited consolidated financial statements for the year ended July 31, 2023, contained in the Company’s Annual Report on Form 10-K filed on November 24, 2023, have been omitted.

The accompanying unaudited interim consolidated financial statements of Digerati Technologies, Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the United States Securities and Exchange Commission. In the opinion of management, these interim financial statements contain all adjustments, consisting of normal recurring adjustments necessary for a fair presentation of financial position and the results of operations for the interim periods presented. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the consolidated financial statements, which would substantially duplicate the disclosure contained in the audited consolidated financial statements for the year ended July 31, 2022, contained in the Company’s Form 10-K filed on October 31, 2022, have been omitted.Reclassification

~~Reclassification~~Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations or net assets of the Company.

Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations or net assets of the Company.6

Earnings (Loss) Per Share

Basic and diluted earnings (loss) per share is computed by dividing loss attributable to common stockholders by the weighted average number of shares of Common Stock outstanding during the period. Basic earnings (loss) per share is computed by dividing the net income (loss) available to common stockholders by the weighted-average number of shares of Common Stock outstanding during the respective period presented in the Company’s accompanying condensed consolidated financial statements. Fully-diluted earnings (loss) per share is computed similarly to basic income (loss) per share except that the denominator is increased to include the number of dilutive Common Stock equivalents using the treasury stock method for options and warrants and the if-converted method for convertible debt.

6The Company excluded the following securities from the calculation of basic and diluted net loss per share as the effect would have been antidilutive.

	Three months ended April 30,					Nine months ended April 30,
	Three months ended October 31,
(in thousands, except per share data)	2023			2022		2023			2022
	2023			2022
NUMERATOR:
Stock options to purchase common stock		13,805,000			9,130,000
NET INCOME (LOSS)	$	(2,244	)	$	3,902	$	(7,012	)	$	(4,726	)
Warrants to purchase common stock		124,942,900			108,550,849
DENOMINATOR:
Convertible Preferred Shares		64,768,674			57,501,882
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC		153,785,787			139,751,107		148,462,169			139,285,833
Convertible Debt		111,399,683			37,963,920
LOSS PER COMMON SHARE - BASIC	$	(0.01	)	$	0.03	$	(0.05	)	$	(0.03	)
Total		314,916,257			213,146,651

	Three months ended April 30,						Nine months ended April 30,
(in thousands, except per share data)	2023			2022			2023			2022
NUMERATOR:
NET INCOME (LOSS)	$	(2,244	)	$	3,902		$	(7,012	)	$	(4,726	)
Less: adjustments to net income	$	-		$	(6,759	)	$	-		$	-
NET INCOME (LOSS) - DILUTED SHARES OUTSTANDING CALCULATION	$	(2,244	)	$	(2,857	)	$	(7,012	)	$	(4,726	)
DENOMINATOR:
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC		153,785,787			139,751,107			148,462,169			139,285,833
Warrants and Options to purchase common stock		-			100,352,766			-			-
Convertible Debt		-			14,063,920			-			-
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - DILUTED		153,785,787			254,167,793			148,462,169			139,285,833
LOSS PER COMMON SHARE - DILUTED	$	(0.01	)	$	(0.01	)	$	(0.05	)	$	(0.03	)

~~The Company excluded the following securities~~Treasury ~~from the calculation of basic and diluted net loss per share as the effect would have been antidilutive~~Shares

	Three months ended April 30,				Nine months ended April 30,
	2023		2022		2023		2022
Convertible Preferred Shares		63,458,674		56,745,216		63,458,674		56,745,216
Convertible Debt		85,183,490		12,633,333		85,183,490		12,633,333
Total		148,642,164		69,378,549		148,642,164		69,378,549

As a result of entering into various convertible debt instruments which contained a variable conversion feature with no floor, warrants with fixed exercise price, and convertible notes with fixed conversion price or with a conversion price floor, we reserved 110,000,000 treasury shares for consideration for future conversions and exercise of warrants, for convertible notes with fixed conversion price, notes with variable conversion feature with a floor and warrants with a conversion price floor. The Company will evaluate the reserved treasury shares on a quarterly basis, and if necessary, reserve additional treasury shares. As of October 31, 2023, we believe that the treasury shares reserved are sufficient for any future conversions of these instruments. As a result, these debt instruments and warrants are excluded from derivative consideration.

~~Treasury~~Customers ~~Shares~~and Suppliers

AsWe arely ~~result~~on ~~of entering into~~ various ~~convertible~~suppliers ~~debt~~to ~~instruments~~provide ~~which~~services ~~contained~~in aconnection ~~variable conversion feature~~ with noour ~~floor,~~VOIP ~~warrants with fixed exercise price,~~ and ~~convertible~~UCaaS ~~notes~~offerings. ~~with~~Our ~~fixed~~customers ~~conversion~~include ~~price~~businesses orin ~~with~~various industries aincluding ~~conversion price floor~~Healthcare, ~~we reserved 104~~Banking,~~000,000~~ ~~treasury~~Financial ~~shares for consideration for future conversions and exercise of warrants~~Services, ~~for convertible notes with fixed conversion price~~Legal, ~~notes~~Real ~~with variable conversion feature with a floor and warrants with a conversion price floor. The Company will evaluate the reserved treasury shares on a quarterly basis~~Estate, and ~~if necessary, reserve additional treasury shares~~Construction. AsWe ~~of April 30, 2023, we believe that the treasury shares reserved~~ are ~~sufficient~~not ~~for~~dependent upon any ~~future conversions of these instruments. As a result,~~single ~~these~~supplier ~~debt~~or ~~instruments and warrants are excluded from derivative consideration~~customer.

~~Customers~~During the three months ended October 31, 2023 and ~~Suppliers~~2022, the Company did not derive revenues of 10% or more from any single customer.

WeAs ~~rely~~of onOctober ~~various~~31, ~~suppliers~~2023, tothe ~~provide~~Company ~~services~~had inone ~~connection~~vendor ~~with~~that ~~our~~comprised ~~VOIP and UCaaS offerings~~12.8% ~~Our~~of ~~customers~~outstanding ~~include~~accounts ~~businesses~~receivable. inAt ~~various industries~~July ~~including Healthcare~~31, ~~Banking~~2023, ~~Financial~~the ~~Services,~~Company did ~~Legal,~~not ~~Real~~have ~~Estate,~~outstanding ~~and~~accounts ~~Construction.~~receivable Weof ~~are~~10% ~~not~~or ~~dependent~~more ~~upon~~from any single ~~supplier~~ or customer.

~~During~~Sources ~~the nine months ended April 30, 2023 and 2022, the Company did not derive revenues~~ of ~~10% or more from any single customer.~~revenue:

AsThe ofCompany ~~April~~recognizes 30cloud-based hosted services revenue, ~~2023~~mainly from subscription services for its cloud telephony applications that includes hosted IP/PBX services, SIP trunking, call center applications, auto attendant, voice, and ~~July~~web 31conferencing, ~~2022~~call recording, ~~the~~messaging, voicemail to email conversion, integrated mobility applications that are device and location agnostic, and other customized applications. Other services include enterprise-class data and connectivity solutions through multiple broadband technologies including cloud WAN or SD-WAN, fiber, and Ethernet over copper. We also offer remote network monitoring, data backup and disaster recovery services. The Company applies ~~did~~a ~~not~~five-step ~~have~~approach ~~outstanding~~in ~~accounts~~determining ~~receivable~~the amount and timing of ~~10%~~revenue orto ~~more~~be ~~from~~recognized: ~~any~~(i) ~~single~~identifying the contract with a customer, (ii) identifying the performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the performance obligations in the contract and (v) recognizing revenue when the performance obligation is satisfied. Substantially all of the Company’s revenue is recognized at the time control of the products transfers to the customer.

7Service Revenue

~~Sources~~Service revenue from subscriptions to the Company’s cloud-based technology platform is recognized over time on a ratable basis over the contractual subscription term beginning on the date that the platform is made available to the customer. Payments received in advance of subscription services being rendered are recorded as deferred revenue:. Usage fees, either bundled or not bundled, are recognized when the Company has a right to invoice. Professional services for configuration, system integration, optimization, customer training and/or education are primarily billed on a fixed-fee basis and are performed by the Company directly. Alternatively, customers may choose to perform these services themselves or engage their own third-party service providers. Professional services revenue is recognized over time, generally as services are activated for the customer.

~~The~~Product Company recognizes cloud-based hosted services revenue, mainly from subscription services for its cloud telephony applications that includes hosted IP/PBX services, SIP trunking, call center applications, auto attendant, voice, and web conferencing, call recording, messaging, voicemail to email conversion, integrated mobility applications that are device and location agnostic, and other customized applications. Other services include enterprise-class data and connectivity solutions through multiple broadband technologies including cloud WAN or SD-WAN (Software-defined Wide Area Network), fiber, and Ethernet over copper. We also offer remote network monitoring, data backup and disaster recovery services. The Company applies a five-step approach in determining the amount and timing of revenue to be recognized: (i) identifying the contract with a customer, (ii) identifying the performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the performance obligations in the contract and (v) recognizing revenue when the performance obligation is satisfied. Substantially all of the Company’s revenue is recognized at the time control of the products transfers to the customer.Revenue

~~Service Revenue~~The Company recognizes product revenue for telephony equipment at a point-in-time, when transfer of control has occurred, which is generally upon delivery. Sales returns are recorded as a reduction to revenue estimated based on historical data.

Service revenue from subscriptions to the Company’s cloud-based technology platform is recognized over time on a ratable basis over the contractual subscription term beginning on the date that the platform is made available to the customer. Payments received in advance of subscription services being rendered are recorded as deferred revenue. Usage fees, either bundled or not bundled, are recognized when the Company has a right to invoice. Professional services for configuration, system integration, optimization, customer training and/or education are primarily billed on a fixed-fee basis and are performed by the Company directly. Alternatively, customers may choose to perform these services themselves or engage their own third-party service providers. Professional services revenue is recognized over time, generally as services are activated for the customer.8

~~Product~~Disaggregation ~~Revenue~~of Cloud-based hosted revenues.

~~The~~Summary ~~Company~~of ~~recognizes~~disaggregated ~~product~~ revenue ~~for telephony equipment at a point-in-time, when transfer of control has occurred, which~~ is ~~generally upon delivery. Sales returns are recorded~~ as afollows ~~reduction~~(in ~~to revenue estimated based on historical data.~~thousands):

Disaggregation of Cloud-based hosted revenues.

	For the Three Months ended October 31,
	2023		2022
Cloud software and service revenue	$	7,621	$	8,076
Product revenue		33		54
Total operating revenues	$	7,654	$	8,130

~~Summary of disaggregated revenue is as follows (in thousands):~~Deferred Income

	For the Three Months Ended April 30,				For the Nine Months Ended April 30,
	2023		2022		2023		2022
Cloud software and service revenue	$	7,777	$	8,092	$	23,694	$	15,677
Product revenue		60		71		214		282
Total operating revenues	$	7,837	$	8,163	$	23,908	$	15,959

Deferred income represents billings or payment received in advance of revenue recognition and is recognized upon transfer of control. Balances consist primarily of annual plan subscription services, for services not yet provided as of the balance sheet date. Deferred revenues that will be recognized during the succeeding 12-month period are recorded as current deferred revenues in the consolidated balance sheets, with the remainder recorded as other noncurrent liabilities in the consolidated balance sheets. Deferred income as of October 31, 2023 and July 31, 2023 was $277,940 and $281,294, respectively.

~~Contract Assets~~Customer deposits

~~Contract~~The ~~assets~~Company ~~are~~in ~~recorded~~some ~~for~~instances ~~those~~requires ~~parts~~customers ofto ~~the~~make ~~contract~~deposits ~~consideration~~for ~~not~~the ~~yet~~last ~~invoiced~~month ~~but~~of ~~for~~services, ~~which~~equipment, ~~the~~installation ~~performance~~charges ~~obligations~~and ~~are completed~~training. ~~The~~As ~~revenue~~equipment is ~~recognized~~installed ~~when~~and ~~the~~training ~~customer~~takes ~~receives~~place, ~~services~~the ordeposits ~~equipment~~are ~~for~~then aapplied ~~reduced~~to ~~consideration~~revenue. atThe ~~the~~deposit ~~onset of an arrangement;~~ for ~~example, when~~ the ~~initial~~last month’s of services is orapplied ~~equipment~~to ~~are~~any ~~discounted.~~outstanding ~~Contract~~balances ~~assets~~if services are ~~included~~cancelled. inIf ~~prepaid~~the ~~and~~customer’s ~~other~~account ~~current assets~~is paid in ~~the consolidated balance sheets~~full, ~~depending~~the onCompany ifwill ~~their~~refund the ~~reduction~~full isdeposit ~~recognized~~in ~~during~~ the ~~succeeding 12-~~month ~~period~~following orservice ~~beyond~~termination. ~~Contract~~ ~~assets~~As as of ~~April~~October 3031, 2023 and July 31, ~~2022~~2023, Digerati’s customer deposits balance was $0822,021 and $6842,~~701~~956, respectively. The customer deposit balance is included as part of deferred income on the consolidated balance sheets.

8Costs to Obtain a Customer Contract

~~Deferred Income~~Direct incremental costs of obtaining a contract consisting of sales commissions are deferred and amortized over the estimated life of the customer, which currently averages 36 months. The Company calculates the estimated life of the customer on an annual basis. The Company classifies deferred commissions as prepaid expenses or other noncurrent assets based on the timing of when it expects to recognize the expense. As of October 31, 2023, the Company has $876,609 in deferred commissions/contract costs, of which the current portion of $392,155 is included in prepaid and other current assets and the long-term portion of $484,454 in other assets in the consolidated balance sheets. Sales commissions expenses for the three months ended October 31, 2023 and 2022 were $837,107 and $676,608, respectively. The costs to obtain customer contract balances are included as part of prepaid expenses and other assets on the consolidated balance sheets.

~~Deferred income represents billings or payment~~Direct ~~received~~Costs in advance of revenue recognition and is recognized upon transfer of control. Balances consist primarily of annual plan subscription services, for services not yet provided as of the balance sheet date. Deferred revenues that will be recognized during the succeeding 12-~~month~~ ~~period~~Cloud ~~are~~software recorded as current deferred revenues in the consolidated balance sheets, with the remainder recorded as other noncurrent liabilities in the consolidated balance sheets. Deferred income as of April 30, 2023 and ~~July 31, 2022 was $425,130 and $66,167, respectively.~~service

~~Customer~~We ~~deposits~~incur bandwidth and colocation charges in connection with our UCaaS or cloud communication services. The bandwidth charges are incurred as part of the connectivity between our customers to allow them access to our various services. We also incur costs from underlying providers for fiber, internet broadband, and telecommunication circuits in connection with our data and connectivity solutions.

~~The~~Derivative ~~Company~~financial ~~in some instances requires customers to make deposits for the last month of services, equipment, installation charges and training~~instruments. As equipment is installed and training takes place, the deposits are then applied to revenue. The deposit for the last month of services is applied to any outstanding balances if services are cancelled. If the customer’s account is paid in full, the Company will refund the full deposit in the month following service termination. As of April 30, 2023 and July 31, 2022, Digerati’s customer deposits balance was $852,141 and $864,345, respectively. The customer deposit balance is included as part of deferred income on the consolidated balance sheets.

~~Costs~~ Digerati does not use derivative instruments to ~~Obtain a Customer Contract~~ hedge exposures to cash flow, market, or foreign currency risks. However, Digerati evaluates its convertible instruments and free-standing instruments such as warrants for derivative liability accounting.

~~Direct incremental costs of obtaining a contract~~For ~~consisting~~derivative offinancial ~~sales~~instruments ~~commissions~~that are ~~deferred~~accounted ~~and~~for ~~amortized~~as ~~over~~liabilities, the ~~estimated~~derivative ~~life~~instrument ofis ~~the~~initially ~~customer,~~recorded ~~which~~at ~~currently~~its ~~averages~~fair ~~36 months.~~value ~~The~~and ~~Company~~is ~~calculates~~then ~~the~~re-valued ~~estimated~~at ~~life~~each ofreporting ~~the~~date. ~~customer~~Any onchanges anin ~~annual~~fair ~~basis.~~value ~~The~~are ~~Company~~recorded ~~classifies~~as ~~deferred~~non-operating, ~~commissions~~non-cash asincome ~~prepaid expenses~~ or ~~other noncurrent assets based on the timing of when it expects to recognize the~~ expense. ~~As of April 30, 2023, the Company has $663,661~~for ineach ~~deferred~~reporting ~~commissions/contract costs~~period. ~~Sales~~For ~~commissions~~derivative ~~expensed~~notes ~~for~~payable ~~the~~conversion ~~nine~~options ~~months ended April 30, 2023~~ and ~~2022~~warrants ~~were~~Digerati ~~$2,050,008~~uses ~~and 1,463,989,~~the ~~respectively.~~Black-Scholes ~~The~~option-pricing ~~costs~~ model to ~~obtain~~value ~~customer contract balances are included as part of prepaid expenses and other assets on~~ the ~~consolidated~~ ~~balance~~derivative ~~sheets~~instruments.

~~Direct~~The ~~Costs~~classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at ~~Cloud~~the ~~software~~end ~~and~~of ~~service~~each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is probable within the next 12 months from the balance sheet date.

We incur bandwidth and colocation charges in connection with our UCaaS or cloud communication services. The bandwidth charges are incurred as part of the connectivity between our customers to allow them access to our various services. We also incur costs from underlying providers for fiber, internet broadband, and telecommunication circuits in connection with our data and connectivity solutions.9

~~Derivative~~Fair ~~financial~~Value ~~instruments~~of Financial Instruments.

~~Digerati~~Fair ~~does~~value ~~not~~is ~~use~~defined ~~derivative~~as ~~instruments~~the toexchange ~~hedge~~price ~~exposures~~that would be received for an asset or paid to ~~cash~~transfer ~~flow,~~a liability (an exit price) in the principal or most advantageous market, for the asset or ~~foreign~~liability ~~currency~~in ~~risks.~~an ~~However,~~orderly ~~Digerati~~transaction ~~evaluates~~between ~~its~~market participants on the measurement date. ~~convertible~~A ~~instruments~~fair value hierarchy is used which requires an entity to maximize the use of observable inputs and ~~free-standing~~minimize ~~instruments~~the ~~such~~use asof ~~warrants~~unobservable inputs ~~for~~when ~~derivative~~measuring ~~liability~~fair ~~accounting~~value. The fair value hierarchy based on the three levels of inputs that may be used to measure fair value are as follows:

~~For derivative~~Level ~~financial~~1 ~~instruments~~– ~~that~~Quoted ~~are~~prices ~~accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date. Any changes~~ in ~~fair~~active ~~value~~markets ~~are~~for ~~recorded~~identical asassets ~~non-operating, non-cash income~~ or ~~expense for each reporting period~~liabilities. ~~For derivative notes payable conversion options and warrants Digerati uses the Black-Scholes option-pricing model to value the derivative instruments.~~

~~The classification~~Level of2 ~~derivative~~– ~~instruments,~~Observable ~~including~~inputs ~~whether~~other ~~such~~than ~~instruments~~Level ~~should~~1 beprices, ~~recorded~~such as ~~liabilities~~quoted orprices asfor ~~equity,~~similar isassets ~~re-assessed at~~or ~~the~~liabilities; ~~end~~or ofother ~~each~~inputs ~~reporting~~that ~~period. Derivative instrument liabilities~~ are ~~classified~~observable ~~in the balance sheet as current~~ or ~~non-current based~~can onbe ~~whether~~corroborated orby ~~not~~observable ~~net-cash~~market ~~settlement~~data offor ~~the~~substantially ~~derivative instrument is probable within~~ the ~~next~~full 12term ~~months~~of ~~from~~ the ~~balance~~assets ~~sheet date~~or liabilities.

9Level 3 – Unobservable inputs that are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.

~~Fair~~For ~~Value~~certain of ~~Financial~~our ~~Instruments~~financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, the carrying amounts approximate fair value due to the short maturity of these instruments. The carrying value of our long-term debt approximates its fair value based on the quoted market prices for the same or similar issues or the current rates offered to us for debt of the same remaining maturities.

~~Fair~~Our ~~value~~derivative isliabilities ~~defined~~ as ~~the~~of ~~exchange~~October ~~price~~31, ~~that~~2023 ~~would~~and beJuly ~~received~~31, ~~for~~2023 anwere ~~asset~~$4,737,561 or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A fair value hierarchy is used which requires an entity to maximize the use of observable inputs and ~~minimize~~$4,125,429, ~~the use of unobservable inputs when measuring fair value~~respectively. ~~The fair value hierarchy based on the three levels of inputs that may be used to measure fair value are as follows:~~

~~Level~~The following 1table –provides ~~Quoted~~the ~~prices~~fair invalue ~~active~~of ~~markets~~the ~~for~~derivative ~~identical~~financial ~~assets~~instruments ormeasured ~~liabilities.~~at fair value using significant unobservable inputs:

Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

			Fair value measurements at reporting date using.
			Quoted prices in active markets for identical liabilities		Significant other observable inputs		Significant unobservable inputs
Description	Fair Value		(Level 1)		(Level 2)		(Level 3)
Derivative liability at July 31, 2023	$	4,125,429		-		-	$	4,125,429

Derivative liability at October 31, 2023	$	4,737,561		-		-	$	4,737,561

Level 3 – Unobservable inputs that are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.10

~~For~~The ~~certain of our financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, the carrying amounts approximate~~ fair ~~value~~market ~~due to the short maturity of these instruments. The carrying~~ value of ~~our~~all ~~long-term~~derivatives ~~debt approximates~~during ~~its fair value based on~~ the ~~quoted~~year ~~market~~ended ~~prices~~July ~~for~~31, ~~the~~2023 ~~same~~was ordetermined ~~similar~~using ~~issues or~~ the ~~current~~Black-Scholes ~~rates~~option ~~offered~~pricing ~~to us for debt~~model ofwhich used the ~~same~~following ~~remaining maturities.~~assumptions:

Our derivative liabilities as of April 30, 2023 and July 31, 2022 were $7,759,446 and $10,587,717, respectively.

Expected dividend yield			0.00%
Expected stock price volatility			169.54% - 178.58%
Risk-free interest rate			3.97% - 5.55%
Expected term			0.25 - 7.30 years

The ~~following~~fair ~~table~~market ~~provides~~value ~~the~~of ~~fair~~all ~~value~~derivatives ofduring the ~~derivative~~three ~~financial~~months ~~instruments~~ended ~~measured~~October at31, ~~fair~~2023 ~~value~~was determined using ~~significant~~the ~~unobservable~~Black-Scholes option pricing ~~inputs~~model which used the following assumptions:

			Fair value measurements at reporting date using.
Expected dividend yield		0.00%
			Quoted prices in active markets for identical liabilities		Significant other observable inputs		Significant unobservable inputs
Expected stock price volatility		124.39% - 162.58%
Description	Fair Value		(Level 1)		(Level 2)		(Level 3)
Risk-free interest rate		4.88% - 5.57%
Derivative liability at July 31, 2022	$	10,587,717		-		-	$	10,587,717
Expected term		0.17 – 7.05 years
Derivative liability at April 30, 2023	$	7,759,446		-		-	$	7,759,446

The ~~fair~~following ~~market~~table ~~value~~provides a summary of ~~all~~the ~~derivatives~~changes ~~during~~in ~~the~~fair ~~year~~value ~~ended~~of ~~July~~the ~~31,~~derivative ~~2022~~financial ~~was~~instruments ~~determined~~measured ~~using~~at ~~the~~fair ~~Black-Scholes~~value ~~option~~on ~~pricing~~a ~~model~~recurring ~~which~~basis ~~used~~using ~~the~~significant ~~following~~unobservable ~~assumptions~~inputs:

Expected dividend yield		0.00	%
Balance at July 31, 2023	$	4,125,429
Expected stock price volatility		63.32% - 250.19	%
Derivative loss		612,132
Risk-free interest rate		0.03% - 2.98	%
Balance at October 31, 2023	$	4,737,561
Expected term		0.05 - 9.50 years

~~The~~Noncontrolling ~~fair market value of all derivatives during the nine months ended April 30, 2023 was determined using the Black-Scholes option pricing model which used the following assumptions:~~interest

Expected dividend yield	0.00%
Expected stock price volatility	93.12% - 198.87%
Risk-free interest rate	3.44% - 5.14%
Expected term	0.17 – 7.56 years

The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, Consolidation, which governs the accounting for and reporting of non-controlling interests (“NCIs”) in partially owned consolidated subsidiaries and the loss of control of subsidiaries. Certain provisions of this standard indicate, among other things, that NCIs be treated as a separate component of equity, not as a liability, that increases and decreases in the parent’s ownership interest that leave control intact be treated as equity transactions rather than as step acquisitions or dilution gains or losses, and that losses of a partially owned consolidated subsidiary be allocated to the NCI even when such allocation might result in a deficit balance. The net income (loss) attributed to the NCI is separately designated in the accompanying consolidated statements of operations.

~~The~~Recently ~~following~~issued ~~table~~accounting ~~provides a summary of the changes in fair value of the derivative financial instruments measured at fair value on a recurring basis using significant unobservable inputs:~~pronouncements.

Balance at July 31, 2022	$	10,587,717
Derivative from new convertible promissory notes recorded as debt discount		63,805
Derivative gain		(2,892,076	)
Balance at April 30, 2023	$	7,759,446

Recent accounting pronouncements, other than below, issued by the FASB (including its Emerging Issues Task Force), the AICPA and the SEC did not, or are not, believed by management to have a material effect on the Company’s present or future financial statements.

10In August 2020, the FASB issued “ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40)” which simplifies the accounting for convertible instruments. The guidance removes certain accounting models which separate the embedded conversion features from the host contract for convertible instruments. Either a modified retrospective method of transition or a fully retrospective method of transition is permissible for the adoption of this standard. Update No. 2020-06 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The Company is currently evaluating the potential impact of this ASU on its financial statements.

~~Noncontrolling~~On ~~interest~~August 1, 2023, the Company adopted “ASU 2016-13 Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASC 326).” This standard replaced the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology. CECL requires an estimate of credit losses for the remaining estimated life of the financial asset using historical experience, current conditions, and reasonable and supportable forecasts and generally applies to financial assets measured at amortized cost, including recognition of credit losses on financing receivables and other financial assets in scope. The adoption of this guidance did not have a material effect on our consolidated financial statements.

The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, Consolidation, which governs the accounting for and reporting of non-controlling interests (“NCIs”) in partially owned consolidated subsidiaries and the loss of control of subsidiaries. Certain provisions of this standard indicate, among other things, that NCIs be treated as a separate component of equity, not as a liability, that increases and decreases in the parent’s ownership interest that leave control intact be treated as equity transactions rather than as step acquisitions or dilution gains or losses, and that losses of a partially owned consolidated subsidiary be allocated to the NCI even when such allocation might result in a deficit balance. The net income (loss) attributed to the NCI is separately designated in the accompanying consolidated statements of operations.11

OnNOTE ~~May~~2 1,– ~~2018,~~GOING Verve Cloud, Inc. (f/k/a T3 Communications, Inc.) (“Verve Cloud”), a Nevada Corporation, entered into a Stock Purchase Agreement (“SPA”), whereby in an exchange for $250,000, Verve Cloud agreed to sell to the buyers 199,900 shares of common stock equivalent to 19.99% of the issued and outstanding common shares of Verve Cloud. The $250,000 of the cash received under this transaction was recognized as an adjustment to the carrying amount of the noncontrolling interest and as an increase in additional paid-in capital in Verve Cloud. At the option of the Company, and for a period of five years following the date of the SPA, the 199,900 shares of common stock in Verve Cloud may be converted into Common Stock of Digerati at a ratio of 3.4 shares of DTGI Common stock for everyone (1) share of Verve Cloud at any time after the DTGI Common Stock has a current market price of $1.50 or more per share for 20 consecutive trading days.CONCERN

~~For~~Financial the nine months ended April 30, 2023 and 2022, the Company accounted for a noncontrolling interest of approximately $898,000 and $1,306,000, respectively. Additionally, one of the buyers serves as a Board Member of T3 Communications, Inc., a Florida Corporation, one of our operating subsidiaries.Condition

~~Recently~~The Company’s consolidated financial statements ~~issued~~have ~~accounting~~been ~~pronouncements~~prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. Since the Company’s inception in 1993, the Company has incurred net losses and accumulated a deficit of approximately $125,769,000 and a working capital deficit of approximately $69,321,000 which raises substantial doubt about Digerati’s ability to continue as a going concern. The Company’s consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

~~Recent~~Management ~~accounting~~Plans ~~pronouncements, other than below, issued by the FASB (including its Emerging Issues Task Force), the AICPA and the SEC did not, or are not, believed by management~~ to ~~have~~Continue as a ~~material~~Going ~~effect on the Company’s present or future financial statements.~~Concern

~~In August~~Management ~~2020,~~believes ~~the~~that ~~FASB~~available ~~issued~~resources ~~“ASU~~as ~~2020-06~~of October 31, ~~Debt~~2023, ~~with~~will ~~Conversion~~not ~~and~~be ~~Other~~sufficient ~~Options~~to ~~(Subtopic~~fund ~~47020)~~the ~~and~~Company’s ~~Derivatives~~operations and ~~Hedging—Contracts~~corporate inexpenses ~~Entity~~over the next 12 months. The Company’s ~~Own~~ability ~~Equity~~to ~~(Subtopic~~continue ~~815~~to meet its obligations and to achieve its business objectives is dependent upon, among other things, raising additional capital, issuing stock-~~40)”~~based ~~which~~compensation ~~simplifies~~to certain members of the ~~accounting~~executive management ~~for~~team ~~convertible~~in ~~instruments~~lieu of cash, or generating sufficient revenue in excess of costs. ~~The~~At ~~guidance~~such ~~removes certain~~time ~~accounting~~as ~~models~~the ~~which~~Company ~~separate~~requires additional funding, the ~~embedded~~Company ~~conversion~~will ~~features~~seek to secure such best-efforts funding from ~~the~~various ~~host~~possible ~~contract~~sources, ~~for~~including ~~convertible~~equity ~~instruments.~~or ~~Either~~debt financing, asales ~~modified~~of ~~retrospective~~assets, ~~method~~or collaborative arrangements. If the Company raises additional capital through the issuance of ~~transition~~equity securities or securities aconvertible ~~fully~~into ~~retrospective~~equity, ~~method~~stockholders ofwill ~~transition~~experience isdilution, ~~permissible~~and ~~for~~such securities may have rights, preferences, or privileges senior to those of the ~~adoption~~holders of ~~this~~common ~~standard~~stock or convertible senior notes. If the Company raises additional funds by issuing debt, the ~~Update~~Company Nomay be subject to limitations on its operations, through debt covenants or other restrictions. ~~2020-06~~If isthe ~~effective~~Company ~~for~~obtains ~~fiscal~~additional funds ~~years~~through ~~beginning~~arrangements ~~after~~with ~~December~~collaborators ~~15,~~or ~~2023~~strategic partners, ~~including~~the ~~interim~~Company ~~periods~~may ~~within~~be ~~those~~required ~~fiscal~~to ~~years~~relinquish its rights to certain technologies. There can be no assurance that the Company will be able to raise additional funds or raise them on acceptable terms. If ~~The~~the Company is ~~currently~~unable ~~evaluating~~to obtain financing on acceptable terms, it may be unable to execute its business plan, the ~~potential~~Company ~~impact~~could ofbe ~~this~~required to ~~ASU~~curtail onits operations, and the Company may not be able to pay off its ~~financial~~obligations, ~~statements~~if and when they come due.

InWe are ~~June~~currently ~~2016,~~taking ~~the~~initiatives ~~FASB~~to ~~issued~~reduce ~~“ASU~~our ~~2016-13~~overall cash deficiencies on a monthly basis. During Fiscal Year 2024, certain members ~~Financial~~of ~~Instruments—Credit~~our ~~Losses~~executive ~~(Topic~~management ~~326):~~team ~~Measurement~~have continued to take a significant portion of ~~Credit~~their ~~Losses~~compensation onin ~~Financial~~common ~~Instruments~~stock and deferred compensation to reduce the depletion of our available cash.” ~~The~~To ~~standard's~~strengthen ~~main~~our business, we intend to adopt best practices from our recent acquisitions ~~goal~~and isinvest in a marketing and sales strategy to ~~improve~~grow ~~financial~~our ~~reporting~~monthly byrecurring ~~requiring~~revenue; ~~earlier~~we ~~recognition~~anticipate ofutilizing ~~credit~~our ~~losses~~value-added onresellers and ~~financing~~channel ~~receivables~~partners to tap into new sources of revenue streams; and ~~other~~we ~~financial~~have also secured numerous agent agreements through our recent ~~assets~~acquisitions inthat ~~scope.~~we ~~Update~~anticipate Nowill accelerate revenue growth. ~~2016-13~~In isaddition, ~~effective~~we ~~for~~will ~~fiscal~~continue ~~years~~to ~~beginning~~focus ~~after~~on ~~December~~selling 15a greater number of comprehensive services to our existing customer base. Further, ~~2022~~in an effort to increase our revenues, ~~including~~we ~~interim~~will ~~periods~~continue ~~within~~to evaluate the ~~those~~acquisition ~~fiscal~~of ~~years.~~various ~~The~~assets ~~Company~~with isemphasis ~~currently~~in ~~evaluating~~VoIP Services and Cloud Communication Services. As a result, during the ~~potential~~due ~~impact~~diligence process ofwe ~~this~~anticipate ~~ASU~~incurring onsignificant ~~its~~legal ~~financial~~and ~~statements~~professional fees.

11We have been successful in raising debt and equity capital in the past and as described in Notes 6, 7, and 8. We have financing efforts in place to continue to raise cash through debt and equity offerings. Although we have successfully completed financings and reduced expenses in the past, we cannot assure you that our plans to address these matters in the future will be successful.

~~NOTE~~We require 2cash –to ~~GOING~~meet ~~CONCERN~~our interest payments to Post Road (as defined below), capital expenditure needs, and operational cash flow needs. The Company anticipates issuing additional equity or entering into additional Convertible Notes to secure the funding required to meet these cash needs. There can be no assurance that the Company will be able to raise additional funds or raise them on acceptable terms. If the Company is unable to obtain financing on acceptable terms, the Company may not be able to meet its interest payments, capital expenditures, and operational needs. As a result, the Company will be required to negotiate with its lender the terms of the current financing agreements, in addition to postponing the timing of deployment of its capital expenditures and extending the timing of the operational cash needs.

~~Financial~~The Operating ~~Condition~~Subsidiaries are parties to the Credit Agreement, dated as of November 17, 2020 (as amended from time to time, the “Credit Agreement”), among the Operating Subsidiaries, Post Road Special Opportunity Fund II LLP (“PRSOF”), as a lender, the other lenders party thereto and Post Road Administrative LLC (“PR Administrative” and, together with its affiliate PRSOF, “Post Road”), as administrative agent for the lenders. The Company is also a party to certain sections of the Credit Agreement. Next Level Internet, Inc. became an Operating Subsidiary and a party to the Credit Agreement in February 2022.

The ~~Company’s consolidated financial statements~~ ~~for~~Credit ~~the~~Agreement ~~nine~~contains ~~months~~customary ~~ending~~representations, ~~April 30~~warranties, ~~2023~~and ~~have~~indemnification ~~been~~provisions. ~~prepared~~The onCredit aAgreement ~~going~~also ~~concern~~contains ~~basis,~~affirmative and ~~which~~negative ~~contemplates~~covenants ~~the~~with ~~realization~~respect ofto ~~assets and~~ the ~~settlement~~operation of ~~liabilities in~~ the ~~normal course of~~ business. ~~Since the Company’s inception in 1993, the Company has incurred net losses~~ and ~~accumulated~~properties ~~a deficit~~ of ~~approximately~~the ~~$120,397,000~~loan ~~and~~parties aas ~~working~~well ~~capital deficit of approximately $65,429,000 which raise substantial doubt about Digerati’s ability to continue~~ as afinancial ~~going concern~~performance.

~~Management Plans to Continue as a Going Concern~~12

~~Management believes that available resources as~~Below ofare ~~April~~key ~~30,~~financial ~~2023~~covenant will not be sufficient to fund the Company’s operations and corporate expenses over the next 12 months. The Company’s ability to continue to meet its obligations and to achieve its business objectives is dependent uponrequirements, ~~and~~(measured ~~other~~quarterly) ~~things,~~for ~~raising additional capital, issuing stock-based compensation to certain members of~~ the ~~executive~~fiscal ~~management~~quarter ~~team~~ended inOctober ~~lieu of cash~~31, or generating sufficient revenue in excess of costs. At such time as the Company requires additional funding, the Company will seek to secure such best-efforts funding from various possible sources, including equity or debt financing, sales of assets, or collaborative arrangements. If the Company raises additional capital through the issuance of equity securities or securities convertible into equity, stockholders will experience dilution, and such securities may have rights, preferences, or privileges senior to those of the holders of common stock or convertible senior notes. If the Company raises additional funds by issuing debt, the Company may be subject to limitations on its operations, through debt covenants or other restrictions. If the Company obtains additional funds through arrangements with collaborators or strategic partners, the Company may be required to relinquish its rights to certain technologies. There can be no assurance that the Company will be able to raise additional funds or raise them on acceptable terms. If the Company is unable to obtain financing on acceptable terms, it may be unable to execute its business plan, the Company could be required to curtail its operations, and the Company may not be able to pay off its obligations, if and when they come due.2023:

We● ~~are~~Maximum–Allowed currently taking initiatives to reduce our overall cash deficiencies on a monthly basis. During fiscal 2023 certain members of our management team will continue to receive a portion of their compensation in common stock to reduce the depletion of our available cash. To strengthen our business, we intend to adopt best practices from or recent acquisitions and invest in a marketing and sales strategy to grow our monthly recurring revenue; we anticipate utilizing our value-~~added~~ ~~resellers~~Senior ~~and~~Leverage ~~channel~~Ratio ~~partners to tap into new sources~~ of ~~revenue streams; and we have also secured numerous agent agreements through our recent acquisitions that we anticipate will accelerate revenue growth~~3.34 ~~In addition, we will continue~~ to ~~focus on selling a greater number of comprehensive services to our existing customer base~~1. Further, in an effort to increase our revenues, we will continue to evaluate the acquisition of various assets with emphasis in VoIP Services and Cloud Communication Services. As a result, during the due diligence process we anticipate incurring significant legal and professional fees.00

We● ~~require~~Minimum–Allowed ~~cash~~– toEBITDA ~~meet our interest payments to Post Road~~ (as defined below), capital expenditure needs, and operational cash flow needs. The Company anticipates issuing additional equity or entering into additional Convertible Notes to secure the funding required to meet these cash needs. There can be no assurance that the Company will be able to raise additional funds or raise them on ~~acceptable~~an ~~terms.~~annualized Ifbasis) the Company is unable to obtain financing on acceptable terms, the Company may not be able to meet its interest payments, capital expenditures, and operational needs. As a result, the Company will be required to negotiate with its lender the terms of ~~the current financing agreements~~$4, ~~in addition to postponing the timing of deployment of its capital expenditures and extending the timing of the operational cash needs.~~710,385

In● ~~November~~Minimum–Allowed ~~2020,~~- ~~the~~Liquidity Company and Verve Cloud, Inc. (a Nevada entity) (“Verve Cloud”) and Verve Cloud’s subsidiaries (Verve Cloud and its subsidiaries, collectively, “the Verve Cloud Nevada Parties”) entered into a credit agreement (the “Credit Agreement”) with Post Road Administrative LLC and its affiliate Post Road Special Opportunity Fund II LLP (collectively, “Post Road”). The Company is a party to certain sections of ~~the Credit Agreement. Next Level Internet~~$2, ~~Inc. became a Verve Cloud Nevada Party in February 2022.~~000,000

12● Maximum Allowed - Capital Expenditures of $94,798 (Quarterly)

~~The~~● ~~Credit~~Minimum–Allowed ~~Agreement~~– ~~contains~~Fixed ~~customary~~Charge ~~representations, warranties,~~Coverage ~~and~~Ratio ~~indemnification~~of ~~provisions~~1.50 ~~The Credit Agreement also contains affirmative and negative covenants with respect~~ to ~~the operation of the business and properties of the loan parties as well as financial performance~~1. ~~Below are key financial covenant requirements (measured quarterly) for the fiscal quarter ended April 30, 2023:~~00

● Maximum Allowed - ~~Senior~~Churn ~~Leverage Ratio~~ of 63.1800% toat ~~1.00~~any time

●As of ~~Minimum~~October ~~Allowed~~31, -2023, ~~EBITDA~~the Company was not in compliance with the financial covenants under the Credit Agreement. This noncompliance, together with certain other events of $default ~~(on~~that anhave ~~annualized~~occurred ~~basis)~~and 4are continuing under the Credit Agreement,~~565~~ resulted in our classifying the indebtedness under the Credit Agreement as a current liability. While Digerati,~~009~~ the parent company of Verve Cloud Nevada, is not subject to these financial covenants, they have had and will continue to have a material impact on Verve Cloud Nevada’s expenditures and ability to raise funds.

●The Operating ~~Minimum~~Subsidiaries’ ~~Allowed~~obligations -under ~~Liquidity~~the Credit Agreement are secured by first priority security interests in (a) the equity interests of $2the Operating Subsidiaries (other than Verve Cloud Nevada),~~000~~ pursuant to the Pledge Agreement,~~000~~ dated November 17, 2020 (the “Pledge Agreement”), made by Verve Cloud Nevada in favor of Post Road Administrative and (b) substantially all of the other assets of the Operating Subsidiaries, pursuant to the Guaranty and Collateral Agreement, dated November 17, 2020, subsequently amended on December 31, 2021, February 4, 2022, December 15, 2022, and February 3, 2023 (the “Guaranty and Collateral Agreement”), among the Operating Subsidiaries and Post Road Administrative.

●During the ~~Minimum~~period ~~Allowed~~beginning -on ~~Interest~~November ~~Coverage~~1, of2021, ~~1.00~~and ending on October 31, 2023, the Company and Post Road entered into several amendments and other modifications to 1the Credit Agreement.00 Specifically:

As● ofOn ~~April~~December 3015, ~~2023~~2022, ~~the Company was not in compliance with our financial covenants with~~ Post Road, ~~and~~agreed ~~as a result, the Notes were classified as current. The Company has requested that Post Road agree~~ to forbear from exercising its remedies in connection with, ~~among other things,~~ the ~~financial~~Company’s ~~covenants~~failure ~~that~~to ~~were~~comply ~~not complied~~ with ~~during~~ the ~~quarter ended April 30, 2023. There can be no assurance that we will be able to restructure our~~ financial covenants ~~with~~in ~~Post Road. If~~ the ~~Company~~Credit isAgreement ~~not~~as ~~able~~of tothe ~~reach~~last anday ~~agreement~~of tothe ~~restructure~~fiscal ~~our~~quarter ~~financial~~ended ~~covenants~~October ~~requirements~~31, ~~and Post Road declares an event of default~~2022, itas ~~would~~well ~~have~~as acertain ~~material~~other ~~adverse~~specified ~~effect~~defaults, onuntil ~~our~~December ~~business and financial condition~~23, ~~including the possibility of Post Road foreclosing on some or all of our assets~~2022.

● On February 3, 2023, with an effective date of December 1523, 2022, Digerati, the ~~lender~~Operating ~~agreed~~Subsidiaries and Post Road entered into a Consent, Limited Waiver and Fourth Amendment to ~~forbear from~~Credit ~~exercising~~Agreement ~~its~~and ~~remedies~~Amendment into ~~connection~~Notes ~~with~~(the “Fourth Amendment”). Among other things, the Fourth Amendment (a) conditionally revised each of the six financial covenants set forth in the Credit Agreement (related to maximum leverage, minimum liquidity, minimum EBITDA, maximum capital expenditures, minimum interest coverage (a provision that ~~were~~replaced ~~not~~the ~~complied~~minimum ~~with~~fixed ~~during~~charge coverage ratio provision), and maximum churn), (b) conditionally waived all then-existing events of default under the Credit Agreement and (c) modified the interest rates payable under the Credit Agreement. In addition, the Fourth Amendment provided that none of the revised financial covenants (other than minimum liquidity of $1,000,000, which was tested and met as of January 31, 2023) would be tested as of the last day of the fiscal quarter ended ~~October~~January 31, ~~2022,~~ as2023 ~~well~~so long as ~~certain~~no ~~other~~additional ~~specified~~events ~~defaults~~of default occurred prior to such date. The conditional revisions to the financial covenants and the conditional waivers of existing events of default in the Fourth Amendment were contingent on the consummation of the Merger with Minority Equality Opportunities Acquisition, ~~until~~Inc., ~~December~~a 23Delaware corporation (“MEOA”) by February 28, ~~2022~~2023 (the “Merger Outside Closing Date”). If the Merger was not consummated by the Merger Outside Closing Date, the terms of the financial covenants would revert to the terms in effect immediately prior to the Fourth Amendment and the existing events of default would continue unwaived. The Merger Outside Closing Date was, as described below, extended several times, but the termination of the Business Combination Agreement with MEOA has effectively nullified the revisions to the financial covenants and conditional waivers set forth in the Fourth Amendment.

● On ~~February~~March 313, 2023, ~~the~~ ~~Company~~Digerati, the ~~Verve~~Operating ~~Cloud Nevada Parties~~Subsidiaries, and Post Road entered into ~~a Consent, Limited Waiver and Fourth Amendment to Credit Agreement and Amendment to Notes (~~the ~~“Fourth~~Fifth Amendment~~”).~~ The Fourth Amendment is effective as of December 23, 2022. Among other things, the Fourth Amendment conditionally revises each of the six financial covenants set forth in Section 11.12 of the Credit Agreement (related to maximum leverage, minimum liquidity, minimum EBITDA, maximum capital expenditures, minimum interest coverage (a provision that replaces the minimum fixed charge coverage ratio provision), and maximum churn). In addition, pursuant to the Fourth Amendment, none of the financial covenants contained in Section 11.12 of the Credit Agreement, aswith ~~amended~~an byeffective ~~the~~date ~~Fourth Amendment, were to be tested as~~ of ~~the~~February ~~January 31~~28, 2023 ~~fiscal quarter end date so long as no events of default had occurred~~, ~~other than minimum liquidity of $1,000,000,~~ which ~~was~~specifically ~~tested and~~extended ~~met as of January 31, 2023. The Fourth Amendment provides that these revised financial covenants will be null and void if~~ the Merger ~~(as~~ ~~defined~~Outside inClosing ~~Note~~Date ~~12)~~from ~~does not close by~~ February 28, 2023 ~~(the “Merger Outside Closing Date”)~~, ~~in which case the financial covenants in effect under Section 11.12 of the Credit Agreement shall automatically, and without notice~~ to ~~the~~April ~~Verve Cloud Nevada Parties~~28, ~~revert~~ ~~to those in effect immediately prior to the Fourth Amendment~~2023.

~~Pursuant~~● toOn ~~the Fourth~~April ~~Amendment~~3, ~~Post~~2023, ~~Road~~Digerati, ~~agreed~~the toOperating ~~conditionally~~Subsidiaries, ~~waive each~~ and ~~all~~Post ofRoad ~~the~~entered ~~Specified~~into ~~Defaults~~a ~~(as~~Sixth ~~defined in the Fourth~~ Amendment). ~~Post~~to ~~Road’s~~its ~~waiver~~Credit ofAgreement (the ~~Specified~~“Sixth ~~Defaults~~Amendment”), ~~are~~which ~~contingent~~(a) ondeferred the ~~Merger~~cash ~~closing~~interest onotherwise ordue ~~before~~and ~~the~~payable ~~Merger~~on ~~Outside Closing~~April ~~Date~~1, in2023, ~~accordance~~to ~~with~~May ~~the~~1, ~~Business~~2023, ~~Combination Agreement (as defined in Note 12)~~ and ~~no events of default~~ (~~other than the Specified Defaults~~b) orincreased ~~any condition or event that, with~~ the ~~giving~~net ofprincipal ~~notice~~amount ~~or the lapse~~ of ~~time~~additional orconvertible ~~both,~~notes ~~would~~the ~~constitute~~Company ~~an event~~was ofpermitted ~~default,~~by ~~existing under~~ the Credit Agreement onto ~~the~~have ~~Merger~~outstanding ~~closing~~from ~~date~~$3,000,000 to $3,500,000.

~~The Fourth Amendment amends the Credit Agreement and the Notes to modify the interest rate payable by Verve Cloud.~~13

● On ~~March~~May 131, 2023, ~~the Company~~with an effective date of April 28, ~~the~~2023, ~~Verve~~Digerati, ~~Cloud~~the ~~Nevada~~Operating ~~Parties~~Subsidiaries, and Post Road entered into ~~the~~a ~~Fifth~~Seventh Amendment to Credit Agreement, ~~with~~(the an“Seventh ~~effective date of February 28~~Amendment”), ~~2023,~~pursuant to which ~~specifically revises~~ the Merger Outside Closing Date, ~~replacing~~was ~~the~~extended ~~“February~~from April 28, 2023”, ~~date~~to ~~with “April~~May 2831, 2023,” ~~without amending, supplementing~~ or ~~otherwise~~such ~~modifying~~later ~~any~~date ~~other~~as ~~terms,~~agreed orto ~~any~~in ofwriting ~~the~~by ~~conditions,~~Post ~~set~~Road ~~forth~~ in ~~the~~its ~~Credit~~sole ~~Agreement~~discretion.

13● On August 16, 2023, Digerati, the Operating Subsidiaries and Post Road entered into a letter agreement, pursuant to which Post Road agreed that all accrued interest that was originally due and payable in cash by the Operating Subsidiaries on April 3, 2023, May 1, 2023, June 1, 2023, July 3, 2023 and August 1, 2023 would, instead, be added to the outstanding principal balances of Term Loan A and Term Loan C, as applicable, under the Credit Agreement on the effective date of the letter agreement, and due on the maturity dates of such loans, along with all other principal and interest amounts thereunder.

OnAdditionally, on ~~April~~November 322, 2023 (with effect from November 2, ~~the Company~~2023), the ~~Verve~~Operating ~~Cloud Nevada Parties~~Subsidiaries, Digerati and Post Road entered into a ~~Sixth~~Second Forbearance Agreement, Amendment to ~~its~~Loan ~~Credit~~Documents ~~Agreement~~and Limited Consent, which (a) extends the ~~“Sixth~~maturity ~~Amendment”).~~date of our Term Loan C Note with Post Road ~~Pursuant~~from November 2, 2023, to ~~the~~December ~~Sixth~~31, ~~Amendment~~2023, (b) provides that Post Road ~~agreed~~and tothe ~~increase~~other lenders under the ~~aggregate~~Credit ~~net~~Agreement ~~unpaid~~shall ~~principal~~forbear through ~~amount~~December ~~(i.e.~~31, ~~less~~2023 ~~original~~from ~~issue~~exercising ~~discounts~~ their rights and ~~transaction~~remedies ~~costs~~under ~~paid~~the inloan ~~cash~~documents byand ~~Company~~applicable ~~upon~~law with respect to (i) certain existing events of default under the ~~closing~~loan ~~thereof~~documents and ~~disclosed~~(ii) incertain ~~writing~~events of default that are expected to ~~Post~~arise ~~Road~~before December 31, 2023, and (c) amends certain provisions of the ~~Company~~Credit isAgreement ~~allowed~~and the other loan documents to ~~borrow~~ inallow the ~~form~~company ofto ~~convertible~~incur ~~loans~~up to an additional $32,~~500~~000,000. ~~This~~of ~~amount~~working ~~was~~capital ~~increased~~financing. ~~from~~For additional information regarding the $3Second Forbearance Agreement,~~000,000~~ ~~agreed~~Amendment to byLoan ~~Post~~Documents and ~~Road~~Limited ~~pursuant~~Consent, see Note 12 - Subsequent Events to the ~~Fourth~~Consolidated ~~Amendment~~Financial Statements.

~~Pursuant~~The toCompany ~~the~~will ~~Sixth~~continue ~~Amendment,~~to ~~Post~~work ~~Road~~with ~~agreed~~various funding sources to ~~defer~~secure ~~the~~additional ~~cash~~debt ~~interest~~and ~~otherwise~~equity ~~due~~financings. ~~and~~However, ~~payable~~Digerati oncannot offer ~~April~~any 1,assurance ~~2023~~that toit will be successful in executing the ~~May~~aforementioned 1,plans ~~2023~~to ~~payment date~~continue as a going concern.

~~On May 1, 2023, the Company, the Verve Cloud Nevada Parties, and~~NOTE ~~Post~~3 ~~Road~~– ~~entered~~INTANGIBLE into a Seventh Amendment to Credit Agreement (the “Seventh Amendment”). The Seventh Amendment is dated as of May 1, 2023, with an effective date of April 28, 2023. Pursuant to the Seventh Amendment, the Merger Outside Closing Date was amended to May 31, 2023, or such later date as agreed to in writing by Post Road in its sole discretion.ASSETS

~~The Seventh Amendment~~Below ~~also~~are ~~modified~~summarized ~~the~~changes ~~negative covenants set forth~~ in ~~the~~intangible ~~Credit~~assets ~~Agreement~~at toOctober ~~add~~31 a2023 new section on material nonpublic information (“MNPI”). The Seventh Amendment’s modifications to the Credit Agreement provide that if Post Road elects not to receive MNPI from the Company during any period during which the Company is obligated to deliver a notice to Post Road which notice would include MNPI, the Company will inform Post Road of its obligation to deliver the notice, and ~~Post~~July ~~Road will inform the Company whether it elects to receive such notice. If Post Road elects to receive the notice of MNPI~~31, the Company shall deliver such notice in accordance with the Credit Agreement, and if Post Road elects not to receive such notice, the Company shall not deliver the notice and Post Road shall have waived its rights to receive delivery of the notice. Any election by Post Road to waive their right to receive delivery of any notice of MNPI applies only with respect to the specific notice and not to any subsequent notice.2023:

Pursuant to the Seventh Amendment, Post Road agreed to defer the cash interest otherwise due and payable on April 3, 2023 and May 1, 2023 to the June 1, 2023 payment date.

	Gross Carrying		Accumulated			Net Carrying
October 31, 2023	Value		Amortization			Amount
NetSapiens - license, 10 years	$	150,000	$	(150,000	)	$	-
Customer relationships, 5 years		40,000		(40,000	)		-
Customer relationships, 7 years		10,947,262		(4,252,451	)		6,694,811
Trademarks, 7 & 10 years		7,148,000		(2,248,787	)		4,899,213
Non-compete, 2 & 3 years		931,000		(803,917	)		127,083
Marketing & Non-compete, 5 years		800,263		(800,263	)		-
Total Definite-lived Intangible Assets		20,016,525		(8,295,418	)		11,721,107
Goodwill		19,380,080		-			19,380,080
Balance, October 31, 2023	$	39,396,605	$	(8,295,418	)	$	31,101,187

While Digerati, the parent company of Verve Cloud, is not subject to these financial covenants, it had, and will continue to have, a material impact on Verve Cloud’s expenditures and ability to raise funds.

	Gross Carrying		Accumulated			Net Carrying
July 31, 2023	Value		Amortization			Amount
NetSapiens - license, 10 years	$	150,000	$	(150,000	)	$	-
Customer relationships, 5 years		40,000		(40,000	)		-
Customer relationships, 7 & 10 years		10,947,262		(3,989,768	)		6,957,494
Trademarks, 7 & 10 years		7,148,000		(1,980,728	)		5,167,272
Non-compete, 2 & 3 years		931,000		(844,583	)		86,417
Marketing & Non-compete, 5 years		800,263		(800,263	)		-
Total Definite-lived Intangible Assets		20,016,525		(7,805,342	)		12,211,183
Goodwill		19,380,080		-			19,380,080
Balance, July 31, 2023	$	39,396,605	$	(7,805,342	)	$	31,591,263

~~In addition, our Term Loan C Note payable to Post Road with a maturity~~Total ~~date~~amortization ofexpense ~~August~~for ~~4, 2023, requires a full principal payment and accrued interest by~~ the ~~maturity~~three ~~date.~~months Weended ~~will~~October ~~work with our equity partners to secure additional financings to meet this obligation by the maturity date. In addition~~31, we2023 will work with our lender on the current terms to the Term Loan C Note, to extend the maturity date or restructure the terms of the note. There can be no assurance that the Company will be able to raise additional funds or raise them on acceptable terms to meet the cash payment requirements on the Term Loan C Note. In addition, there can be no assurance that we will be able to restructure the terms or extend the maturity date of the Term Loan C Note with Post Road. If the Company is not able to restructure the financing or repay the Term Loan C Note by the August 4th maturity date and ~~Post~~2022 ~~Road~~was ~~declares an event of default~~$490,076 ~~it would have a material adverse effect on our business~~ and ~~financial condition~~$756,837, ~~including the possibility of Post Road foreclosing on some or all of our assets~~respectively.

Verve Cloud’s obligations under the Credit Agreement are secured, in part, by a first-priority security interest in all of the assets of the Verve Cloud Nevada Parties and are guaranteed by Verve Cloud’s other subsidiaries pursuant to the Guaranty and Collateral Agreement, dated November 17, 2020, subsequently amended on December 31, 2021, February 4, 2022, December 15, 2022, and February 3, 2023 by and among Verve Cloud, the Company’s other subsidiaries, and Post Road Administrative LLC (the “Guaranty and Collateral Agreement”). In addition, Verve Cloud’s obligations under the Credit Agreement are, pursuant to a Pledge Agreement (the “Pledge Agreement”), secured by a pledge of a first priority security interest in Verve Cloud’s 100% equity ownership of each of Verve Cloud’s operating companies.14

WeThe Company ~~have~~expects ~~been~~to ~~successful~~record inamortization ~~raising~~expense ~~debt~~of ~~and~~intangibles ~~equity capital~~assets inover the ~~past~~next ~~and~~five years ~~as described in Notes 6, 7, 8,~~ and ~~12.~~thereafter ~~Although~~as ~~we have successfully completed financings and reduced expenses in the past, we cannot assure you that our plans to address these matters in the future will be successful.~~follows:

Period Ending July 31,	Amortization
2024 *	$	1,669,728
2025		2,108,167
2026		1,856,869
2027		1,838,645
2028		1,560,074
2029 and thereafter		2,687,624
Total:	$	11,721,107

~~The~~* ~~current~~Nine ~~Credit~~months Agreement with Post Road will allow the Company to continue acquiring UCaaS service providers that meet the Company’s acquisition criteria. Management anticipates that future acquisitions will provide additional operating revenues to the Company as it continues to execute on its consolidation strategy. There can be no guarantee that the planned acquisitions will close or that they will produce the anticipated revenues on the schedule anticipated by management.remaining

~~The Company will continue to work with various~~NOTE ~~funding~~4 ~~sources~~– toSTOCK-BASED ~~secure additional debt and equity financing. However, Digerati cannot offer any assurance that it will be successful in executing the aforementioned plans to continue as a going concern.~~COMPENSATION

AsIn ~~described~~November ~~elsewhere herein~~2015, wethe ~~are~~Company ~~not~~adopted ~~generating~~the ~~sufficient~~Digerati ~~cash~~Technologies, ~~from~~Inc. ~~operations~~2015 toEquity ~~pay~~Compensation ~~for~~Plan ~~our~~(the ~~corporate~~“Plan”). ~~and~~On ~~ongoing~~May ~~operating expenses~~25, or2023, tothe ~~pay~~Company ~~our~~amended ~~current~~The ~~liabilities.~~Plan Aswhich now authorizes the grant of ~~April~~up ~~30,~~to ~~2023,~~15 ~~our~~million ~~total~~(previously ~~liabilities~~7.5 ~~were~~million) ~~approximately~~stock ~~$69~~options,~~632~~ restricted common shares,~~000,~~ ~~which~~non-restricted ~~included~~common $7shares and other awards to employees,~~759~~ directors,~~000 in~~ ~~derivative~~and ~~liabilities~~certain other persons. WeThe Plan is intended to permit the Company to retain and attract qualified individuals who will ~~continue~~contribute to ~~use~~the ~~our~~overall ~~available~~success ~~cash~~of the Company. The Company’s Board of Directors determines the terms of any grants under the Plan. Exercise prices of all stock options and other awards vary based on ~~hand~~the tomarket ~~cover~~price ~~our~~of ~~deficiencies~~the inshares ~~operating~~of ~~expenses~~common stock as of the date of grant. The stock options, restricted common stock, non-restricted common stock, and other awards vest based on the terms of the individual grant.

~~The~~During the ~~Company’s~~three ~~consolidated~~months ~~financial~~ended ~~statements as~~October ~~of April 30~~31, 2023 doand ~~not~~2022, ~~include any adjustments that might result from~~ the ~~inability to implement or execute the~~ Company’s ~~plans to~~did ~~improve~~not ~~our~~issue ~~ability~~any tonew ~~continue~~stock ~~as a going concern~~options.

~~NOTE~~The Company 3recognized –approximately ~~INTANGIBLE~~$11,980 ~~ASSETS~~and $22,996 in stock-based compensation expense for stock options to employees for the three months ended October 31, 2023 and 2022, respectively. Unamortized compensation stock option cost totaled $4,039 and $74,976 as of October 31, 2023 and October 31, 2022, respectively.

~~Below~~A summary ~~are~~of ~~summarized~~the ~~changes~~stock inoptions ~~intangible~~outstanding ~~assets at~~as ~~April~~of 30October 31, 2023 and July 31, ~~2022~~2023, and the changes during the three months ended October 31, 2023 are presented below:

	Gross Carrying		Accumulated			Net Carrying
			Weighted average exercise			Weighted average remaining contractual term
April 30, 2023	Value		Amortization			Amount
	Options		price			(years)
NetSapiens - license, 10 years	$	150,000	$	(150,000	)	$	-
Outstanding at July 31, 2023		13,805,000	$	0.05			3.68
Customer relationships, 5 years		40,000		(40,000	)		-
Granted		-		-			-
Customer relationships, 7 years		10,947,262		(3,630,483	)		7,316,779
Exercised		-		-			-
Trademarks, 7 & 10 years		7,148,000		(1,739,103	)		5,408,897
Forfeited and cancelled		-		-			-
Non-compete, 2 & 3 years		931,000		(732,083	)		198,917
Outstanding on October 31, 2023		13,805,000	$	0.05			3.43
Marketing & Non-compete, 5 years		800,263		(799,981	)		282
Exercisable on October 31, 2023		13,721,577	$	0.05			3.40
Total Definite-lived Intangible Assets		20,016,525		(7,091,650	)		12,924,875
Goodwill		19,380,080		-			19,380,080
Balance, April 30, 2023	$	39,396,605	$	(7,091,650	)	$	32,304,955

	Gross Carrying		Accumulated			Net Carrying
July 31, 2022	Value		Amortization			Amount
NetSapiens - license, 10 years	$	150,000	$	(150,000	)	$	-
Customer relationships, 5 years		40,000		(36,684	)		3,316
Customer relationships, 7 years		10,947,262		(2,573,052	)		8,374,210
Trademarks, 7 & 10 years		7,148,000		(993,806	)		6,154,194
Non-compete, 2 & 3 years		931,000		(394,583	)		536,417
Marketing & Non-compete, 5 years		800,263		(679,980	)		120,283
Total Definite-lived Intangible Assets		20,016,525		(4,828,105	)		15,188,420
Goodwill		19,380,080		-			19,380,080
Balance, July 31, 2022	$	39,396,605	$	(4,828,105	)	$	34,568,500

The aggregate intrinsic value (the difference between the Company’s closing stock price on the last trading day of the period and the exercise price, multiplied by the number of in-the-money options) of the 13,805,000 and 13,805,000 stock options outstanding as of October 31, 2023 and July 31, 2023, was $74,840 and $28,065, respectively.

~~Total~~The aggregate ~~amortization~~intrinsic ~~expense~~value ~~for~~of ~~the~~13,721,577 ~~nine~~and ~~months ended~~13,519,606 ~~April~~stock 30options exercisable on October 31, 2023 and ~~2022~~July 31, 2023 was $274,~~263,546~~840 and $228,~~215~~065,~~872,~~ respectively.

NOTE 5 4 – ~~STOCK-BASED COMPENSATION~~WARRANTS

~~In November 2015, the Company adopted the Digerati~~During ~~Technologies, Inc. 2015 Equity Compensation Plan (~~the ~~“Plan”).~~three ~~The~~months ~~Plan~~ended ~~authorizes~~October ~~the grant of up to 7.5 million stock options~~31, ~~restricted~~ ~~common~~2023 ~~shares, non-restricted common shares~~ and ~~other awards to employees~~2022, ~~directors, and certain other persons. The Plan is intended to permit~~ the Company todid ~~retain~~not ~~and~~issue ~~attract qualified individuals who will contribute to the overall success of the Company. The Company’s Board of Directors determines the terms of~~ any ~~grants under the Plan~~warrants. Exercise prices of all stock options and other awards vary based on the market price of the shares of common stock as of the date of grant. The stock options, restricted common stock, non-restricted common stock, and other awards vest based on the terms of the individual grant.

~~During~~A summary of the ~~nine~~warrants ~~months~~outstanding ~~ended~~as ~~April~~of 30October 31, 2023 and ~~2022~~July 31, 2023, and the ~~Company~~changes ~~did~~during ~~not~~the ~~issue~~three ~~any~~months ~~new~~October ~~stock~~31, ~~options.~~2023, are presented below:

The Company recognized approximately $80,122 and $74,466, respectively, in stock-based compensation expense for stock options to employees for the nine months ended April 30, 2023 and 2022. Unamortized compensation stock option cost totaled $17,850 and $125,653, respectively, as of April 30, 2023 and 2022.

	Warrants		Weighted average exercise price		Weighted average remaining contractual term (years)
Outstanding at July 31, 2023		124,942,900	$	0.03		6.89
Granted		-		-		-
Exercised		-	$	-		-
Forfeited and cancelled		-	$	-		-
Outstanding on October 31, 2023		124,942,900	$	0.03		6.64
Exercisable on October 31, 2023		98,017,606	$	0.03		6.58

AThe aggregate ~~summary~~intrinsic ofvalue (the difference between the Company’s closing stock ~~options~~price ~~outstanding~~on ~~as of~~the ~~April~~last ~~30,~~trading ~~2023~~day of the period and ~~July~~the exercise 31price, ~~2022,~~multiplied ~~and~~by the ~~changes~~number ~~during~~of in-the-money ~~nine~~warrants) ~~months~~of ~~ended~~the ~~April~~124,942,900 30and 124,942,900 warrants outstanding as of October 31, 2023 ~~are~~and ~~presented~~July ~~below:~~31, 2023, was $3,231,035 and $2,692,529, respectively.

				Weighted average exercise		Weighted average remaining contractual
	Options			price		term (years)
Outstanding at July 31, 2022		9,130,000		$	0.17		2.39
Granted		-			-		-
Exercised		-			-		-
Forfeited and cancelled		(1,355,000	)		0.35		-
Outstanding on April 30, 2023		7,775,000		$	0.12		1.99
Exercisable on April 30, 2023		7,287,634		$	0.12		1.96

The aggregate intrinsic value of 98,017,606 and 98,017,606 warrants exercisable on October 31, 2023 and July 31, 2023, was $2,423,277 and $2,019,397, respectively.

~~The aggregate intrinsic value (the difference~~NOTE ~~between~~6 ~~the~~– ~~Company’s~~NOTES ~~closing~~PAYABLE ~~stock price on the last trading day of the period and the exercise price, multiplied by the number of in~~NON-~~the-money options) of the 7,775,000 and 9,130,000 stock options outstanding as of April 30, 2023 and July 31, 2022, was $104,067 and $191,722, respectively.~~CONVERTIBLE

~~The~~On October ~~aggregate~~22, ~~intrinsic~~2018, ~~value~~the Company issued a secured promissory note for $50,000, bearing interest at a rate of 78% per annum,~~287~~ with maturity date of December 31,~~634~~ 2018. The maturity date was extended multiple times and subsequently on August 4, 2023, the lender agreed to extend 7the maturity until January 31,~~551~~ 2024. The promissory note is secured by a Pledge and Escrow Agreement,~~179~~ ~~stock~~whereby ~~options~~the ~~exercisable~~Company onagreed ~~April~~to 30pledge rights to collateral due under a certain agreement. The principal outstanding balance as of October 31, 2023 and July 31, ~~2022~~2023 was $9350,~~245 and $110,380, respectively~~000.

~~NOTE~~Credit Agreement 5and ~~– WARRANTS~~Notes

~~During~~Pursuant to the ~~nine~~Credit ~~months~~Agreement ~~ended~~(as ~~April~~defined 30in Note 2), ~~2023~~Post Road provided Verve Cloud with a secured loan of up to $20,000,000 (the “Loan”), ~~Company~~with ~~issued~~initial 17loans of $10,~~241~~500,~~721~~000 ~~warrants~~pursuant ~~under~~to ~~promissory~~the ~~notes~~issuance inof ~~which~~a ~~the~~Term ~~warrants~~Loan ~~vested~~A atNote and $3,500,000 pursuant to the ~~time~~issuance of ~~issuance.~~a ~~The~~Term ~~warrants~~Loan B ~~have~~Note, aneach ~~expiration term~~funded ofon ~~five~~November ~~(5)~~17, ~~years~~2020, ~~with~~and an ~~exercise~~additional ~~price~~$6,000,000 in loans, in increments of $~~0.1195.~~1,000,000, ~~Under~~as requested by Verve Cloud before the ~~Black-Scholes~~18 ~~valuation~~month ~~method,~~anniversary of the ~~relative~~initial ~~fair~~funding ~~market~~date ~~value~~to of be lent pursuant to the ~~warrants~~issuance atof ~~time~~a Delayed Draw Term Note. After payment of ~~issuance~~transaction-related ~~was~~expenses ~~approximately~~and closing fees of $~~837~~964,000 ~~and~~, ~~was~~net ~~recognized~~proceeds asto athe ~~discount~~Company onfrom ~~the~~Term ~~promissory~~Loan ~~notes~~A Note and Term Loan B Note totaled $13,036,000. The Company ~~will~~ ~~amortize~~recorded these discounts and cost of $964,000 as a discount to the ~~debt~~Notes, which discount was amortized as interest expense over 12the ~~months~~term of the notes.

~~The~~During the ~~Company~~year ~~did~~ended ~~not~~July ~~issue~~31, ~~any~~2023, ~~warrants~~the ~~during~~ total debt discount for the ~~nine~~Term ~~months~~Loan ~~ended~~A ~~April~~Note ~~30,~~and ~~2022~~the Term Loan B Note was fully amortized.

16The loans under the original Term Loan A Note had a maturity date of November 17, 2024, and an interest rate of LIBOR (with a minimum rate of 1.5%) plus twelve percent (12%). The loans were non-amortized (interest only payments) through the maturity date and contained an option for the Company to pay interest in kind (“PIK”) for up to five percent (5%) of the interest rate in year one, four percent (4%) in year two and three percent (3%) in year three. The original Term Loan A Note was amended and restated and replaced by the Amended and Restated Term Loan A Note (the “A&R Term Loan A Note”) issued by the Operating Subsidiaries in favor of Post Road on December 20, 2021 as indicated below.

~~A summary of the warrants outstanding as of April 30, 2023 and July 31, 2022, and the changes during the nine months April 30, 2023, are presented below:~~16

	Warrants			Weighted average exercise price		Weighted average remaining contractual term (years)
Outstanding at July 31, 2022		108,841,179		$	0.01		8.21
Granted		17,241,721			0.12		4.72
Exercised		(170,298	)	$	0.13		-
Forfeited and cancelled		(969,702	)	$	0.30		-
Outstanding on April 30, 2023		124,942,900		$	0.03		7.14
Exercisable on April 30, 2023		98,017,606		$	0.03		7.09

The loans under the Term Loan B Note had a maturity date of December 31, 2021, and an interest rate of LIBOR (with a minimum rate of 1.5%) plus twelve percent (12%). The loans were was non-amortized (interest only payments) through the maturity date and contained an option for the Company to PIK for up to five percent (5%) of the interest rate in year one, four percent (4%) in year two and three percent (3%) in year three. The loans under the Term Loan were recapitalized under the revised A&R Term Loan A Note as indicated below and the Term Loan B Note ceased to be outstanding at that time.

~~The~~On ~~aggregate~~December ~~intrinsic~~20, ~~value~~2021, (the ~~difference~~Operating ~~between~~Subsidiaries ~~the~~and ~~Company’s~~Post ~~closing~~Road ~~stock~~entered ~~price~~into onan ~~the~~amendment ~~last~~to ~~trading~~the ~~day~~Credit ofAgreement (the ~~period~~“First ~~and~~Amendment”) ~~the~~in ~~exercise~~connection ~~price,~~with ~~multiplied~~which byVerve ~~the~~Cloud ~~number~~issued ofan ~~in-~~Amended and Restated Term Loan A Note (the~~-money~~ ~~warrants~~“A&R Term Loan A Note”) in replacement of the ~~124~~Term Loan A Note. Under the First Amendment,~~942,900~~ ~~and~~the ~~108~~$3,~~841~~500,~~179~~000 ~~warrants~~ outstanding asprincipal balance of ~~April~~ ~~30,~~the ~~2023~~Term ~~and~~Loan ~~July~~B ~~31,~~Note accrued ~~2022,~~interest ~~was~~of $6187,~~451~~442,~~301~~ and amendment fee of $91,~~002~~418,~~606,~~744 ~~respectively~~were recapitalized under the revised A&R Term Loan A Note.

~~The~~Pursuant ~~aggregate~~to ~~intrinsic~~the ~~value~~First Amendment, the additional proceeds of 98$6,~~017~~000,~~606~~000 were used to fund the acquisition of the assets of Skynet Telecom LLC (“Skynet”) and ~~81,615,885~~for ~~warrants~~general ~~exercisable~~corporate onand ~~April~~working ~~30,~~capital ~~2023~~purposes as well as professional fees and ~~July~~other ~~31,~~fees ~~2022~~and ~~was~~expenses with respect to the transactions contemplated by the First Amendment. The Company evaluated the amendment and the recapitalization of the notes and accounted for these changes as an extinguishment of debt and recognized a loss on extinguishment of debt of $45,~~838~~479,~~476~~865, ~~and~~the loss is composed of the full amortization debt discount of $64,~~757~~061,~~037~~121, ~~respectively~~and the amendment fees of $1,418,744.

~~NOTE~~The A&R 6Term –Loan ~~NOTES~~A ~~PAYABLE~~Note ~~NON-CONVERTIBLE~~has a maturity date of November 17, 2024, and an interest rate of Term SOFR (with a minimum rate of 3.5%) plus twelve percent (12%). The principal balance and accrued PIK interest outstanding on the A&R Term Loan was $26,293,208 and $23,879,060 as of October 31, 2023 and July 31, 2023, respectively, and had accrued PIK interest outstanding of $4,124,693 and $1,710,545, respectively.

On February ~~October 22~~4, ~~2018~~2022, Verve Cloud and Post Road entered into a Joinder and Second Amendment to Credit Agreement (the ~~Company~~“Joinder and Second Amendment”) in connection with which Verve Cloud issued a ~~secured promissory~~Term ~~note~~Loan ~~for~~C ~~$50~~Note. Pursuant to the Joinder and Second Amendment,~~000,~~ ~~bearing~~Post Road ~~interest~~provided atVerve Cloud with a ~~rate~~secured loan of 8%$10,000,000. ~~per~~The ~~annum~~proceeds of $10,000,000 ~~with~~were ~~maturity~~used ~~date~~to fund the acquisition of ~~December~~Next 31Level Internet, ~~2018~~Inc. ~~The~~(“Next ~~maturity~~Level” ~~date~~or ~~was~~“NLI”) and for general corporate and working capital purposes as well as professional ~~extended~~fees ~~multiple~~and ~~times~~other fees and onexpenses ~~February~~with ~~16,~~respect ~~2023,~~to the ~~lender~~transactions ~~agreed~~contemplated toby ~~extend~~the Joinder and Second Amendment. At issuance the ~~maturity~~Company recognized ~~until~~$250,000 ~~June~~in 30OID and $220,000 ~~2023~~in debt issuance. The ~~promissory~~total ~~note~~unamortized ~~is secured~~debt bydiscount awas ~~Pledge~~$0 and ~~Escrow~~$0 ~~Agreement~~as of October 31, ~~whereby~~2023 and ~~the~~July ~~Company~~31, ~~agreed~~2023, torespectively. ~~pledge~~The ~~rights~~principal tobalance aon ~~collateral~~the ~~due~~Term ~~under~~Loan ~~certain~~C ~~Agreement.~~Note ~~The outstanding~~was ~~balance~~$12,253,320 and as$11,128,264, respectively, as of ~~April~~October 3031, 2023 and July 31, ~~2022~~2023 ~~was~~and had accrued PIK interest outstanding of $502,~~000~~253,320 and $1,128,264, respectively. Term Loan C Note had a maturity date of August 4, 2023, which was subsequently amended to mature on November 2, 2023 and again amended to mature on December 31, 2023, and an interest rate of Term SOFR (with a minimum rate of 3.5%) plus twelve percent (12%).

For further details regarding the Credit Agreement, ~~and~~as ~~Notes~~amended through December 31, 2023 please see Note 2, “Management Plans to Continue as a Going Concern” to the consolidated financial statements.

~~Pursuant to the Credit Agreement (as defined in Note 2), Post Road~~Promissory provided Verve Cloud with a secured loan of up to $20,000,000 (the “Loan”), with initial loans of $10,500,000 pursuant to the issuance of a Term Loan A Note and $3,500,000 pursuant to the issuance of a Term Loan B Note, each funded on November 17, 2020, and an additional $6,000,000 in loans, in increments of $1,000,000, as requested by Verve Cloud before the 18 month anniversary of the initial funding date to be lent pursuant to the issuance of a Delayed Draw Term Note. After payment of transaction-related expenses and closing fees of $964,000, net proceeds to the Company from the Term Loan A Note and the Term Loan B Note totaled $13,036,000. The Company recorded these discounts and cost of $964,000 as a discount to the Notes ~~and~~– ~~will~~Next beLevel ~~amortized~~Internet asAcquisition ~~interest expense over the term of the notes.~~

~~During~~On February ~~the~~4, ~~nine~~2022, ~~months~~as ~~ended~~per ~~April~~the ~~30,~~acquisition ~~2023~~of Next Level, the Company entered into two unsecured promissory notes (the “Unsecured ~~total~~Adjustable ~~debt~~Promissory ~~discount~~Notes”) for $1,800,000 and $200,000, respectively. The notes are payable in eight equal quarterly installments in the ~~Term~~aggregate ~~Loan~~amount Aof ~~Note~~$250,000 each commencing on June 4, 2022, through and including March 7, 2024, with a base annual interest rate of 0% and a default annual interest rate of 18%. The amount owed is subject to change based on certain revenue milestones required to be achieved by Next Level. At issuance, the ~~Term~~Company ~~Loan~~fair Bvalued ~~Note~~the ~~was~~notes and ~~fully~~recognized a debt discount of $241,000 which is amortized over the term of the notes. The ~~total~~Company amortized $30,125 to interest expense during the three months ended October 31, 2023. Total unamortized debt discount ~~outstanding~~ on the notes as of ~~April~~October 31, 2023 and July 31, 2023 was $30,125 and $60,250, respectively. The total principal balance outstanding as of October 31, 2023 and July 31, ~~2022~~2023 on the Unsecured Adjustable Promissory Notes was $01,583,625 and $1,500,000, respectively.

~~Term~~On January ~~Loan~~3, A2023, ~~Note~~the ~~has~~Company aamended ~~maturity~~its ~~date~~forbearance ofagreement ~~November 17,~~with ~~2024,~~the Noteholders and anagreed to pay the deferred payment, together with interest at the rate of ~~LIBOR~~18% per annum (~~with~~based aupon ~~minimum~~the ~~rate~~number of ~~1.5%)~~days ~~plus~~elapsed ~~twelve~~between ~~percent~~the ~~(12%).~~date ~~Term~~the ~~Loan~~deferred Apayment is ~~non-amortized (interest~~scheduled ~~only~~for ~~payments)~~payment ~~through~~under the ~~maturity~~Notes and the date the deferred payment is actually paid and ~~contains~~a anyear ~~option~~of ~~for~~360 ~~the~~days) ~~Company~~and toextension ~~pay~~fees ~~interest~~of in$7,500 ~~kind~~on or before February 28, 2023 (~~PIK)~~the ~~for~~period upfrom tothe ~~five~~effective ~~percent~~date ~~(5%~~through February 28, 2023) of. ~~the~~This ~~interest~~deferral ~~rate~~of payment resulted in ~~year~~an ~~one~~additional principal added to the balance of $26,125, ~~four~~which ~~percent~~consisted ~~(4%)~~of inthe ~~year~~extension ~~two~~fee ~~and~~of ~~three~~$7,500 ~~percent~~and ~~(3%)~~interest inexpense ~~year~~of ~~three~~$18,625.

Term Loan B had a maturity date of December 31, 2021, and an interest rate of LIBOR (with a minimum rate of 1.5%) plus twelve percent (12%). Term Loan B was non-amortized (interest only payments) through the maturity date and contained an option for the Company to pay interest in kind (PIK) for up to five percent (5%) of the interest rate in year one, four percent (4%) in year two and three percent (3%) in year three. Term Loan B was recapitalized under the revised A&R Term Loan A Note as indicated below.17

17On February 28, 2023, the Company extended the payment date for the September 4, 2022 installment to be due by April 30, 2023 in exchange for a $15,000 amendment fee to be added to the outstanding principal balance. This deferral of payment resulted in an additional principal added to the balance of $39,000, which consisted of the extension fee of $15,000 and interest expense of $24,000. The $39,000 balance was paid on March 15, 2023.

On March ~~December 20~~7, ~~2021~~2023, ~~Verve~~the ~~Cloud~~Company ~~and~~extended ~~Post~~the ~~Road entered~~payment ~~into~~date anfor ~~amendment to~~ the ~~Credit~~March ~~Agreement~~7, ~~(the~~2023 ~~“First~~installment ~~Amendment”)~~to inbe ~~connection~~due ~~with~~by ~~which~~April ~~Verve~~30, ~~Cloud~~2023 ~~issued~~in anexchange ~~Amended~~for a ~~and~~$7,500 ~~Restated~~amendment ~~Term~~fee ~~Loan~~to Abe ~~Note~~added (to the ~~“A&R~~outstanding ~~Term~~principal ~~Loan~~balance. AThis ~~Note”)~~deferral ~~in replacement~~ of ~~the~~payment ~~Term~~resulted ~~Loan~~in Aan ~~Note.~~additional ~~Under~~principal added to the ~~First~~balance ~~Amendment, the~~of $38,500,~~000~~ ~~outstanding~~which ~~principal~~consisted ~~balance~~ of the ~~Term~~extension ~~Loan~~fee ~~B Note accrued interest~~ of $~~187~~7,~~442,~~500 and ~~amendment~~interest ~~fee~~expense of $1,~~418,744~~000. ~~were recapitalized~~The ~~under~~$8,500 ~~the~~balance ~~revised~~was ~~A&R~~paid on ~~Term~~March ~~Loan~~15, ~~A Note~~2023.

~~Pursuant~~On May ~~to the First Amendment~~1, ~~the additional proceeds of $6~~2023,~~000,000~~ ~~were used to fund~~ the ~~acquisition~~Company ofextended the ~~assets~~payment ofdate ~~Skynet Telecom LLC (“Skynet”) and~~ for ~~general~~the ~~corporate and~~September ~~working~~4, ~~capital~~2022 ~~purposes~~installment ~~as well as professional fees and other fees and expenses with respect~~ to ~~the~~be ~~transactions~~due ~~contemplated~~ by ~~the~~ ~~First~~May ~~Amendment.~~31, ~~The~~2023 ~~Company~~in ~~evaluated~~exchange ~~the amendment and the recapitalization of the notes and accounted~~ for ~~these changes as an extinguishment~~payment of ~~debt~~accrued ~~and~~interest ~~recognized~~between aMarch ~~loss~~15, on2023 ~~extinguishment~~and ofApril ~~debt of $5~~30,~~479,865,~~ ~~the~~2023 ~~loss is composed~~ of ~~the full amortization debt discount of~~ $45,~~061,121,~~750.00 ~~and~~which ~~the~~was ~~amendment~~paid ~~fees~~on ofMay $110,~~418,744~~ 2023.

~~The~~On ~~A&R~~May ~~Term~~1, ~~Loan~~2023, Athe ~~Note~~Company ~~has~~extended athe ~~maturity~~payment date offor ~~November~~the ~~17,~~March ~~2024~~7, ~~and~~2023 aninstallment ~~interest~~to ~~rate~~be ofdue ~~Term~~by ~~SOFR~~May ~~(with~~31, a2023 ~~minimum~~in ~~rate~~exchange offor ~~3.5%)~~payment ~~plus~~of ~~twelve percent (12%). The principal balance and~~ accrued ~~PIK~~ interest ~~outstanding~~between onMarch ~~the A&R Term Loan was $23~~15,~~465,727~~ 2023 and ~~$22,168,515~~ ~~as of~~ April 30, 2023 ~~and~~of ~~July 31~~$5,750.00 ~~2022,~~which ~~respectively,~~was ~~and~~paid ~~had~~on ~~accrued~~May ~~PIK interest outstanding of $1~~10,~~297,212~~ ~~and $530,672, respectively~~2023.

On ~~February~~ 4June 1, ~~2022~~2023, ~~Verve~~the Company ~~Cloud~~ and ~~Post~~the ~~Road~~Noteholders ~~entered~~agreed ~~into~~to aextend ~~Joinder~~the ~~and~~due ~~Second~~date ~~Amendment~~for ~~to Credit Agreement (~~the ~~“Joinder~~principal ~~and Second~~payment ~~Amendment”)~~along ~~in connection~~ with ~~which~~accrued ~~Verve~~interest ~~Cloud~~due ~~issued~~on aMay ~~Term~~31, ~~Loan~~2023 ~~C Note. Pursuant~~ to ~~the Joinder and Second~~ ~~Amendment,~~June ~~Post Road provided Verve Cloud with a secured loan of $10~~30,~~000,000~~ 2023. The ~~proceeds~~Company ofaccrued $1083,~~000,000~~625 ~~were used to fund the acquisition~~ of ~~Next~~default ~~Level~~interest ~~Internet,~~expense ~~Inc.~~during ~~(“Next~~the ~~Level”~~three ormonths ~~“NLI”)~~ended ~~and~~October ~~for~~31, ~~general~~2023, ~~corporate~~which ~~and~~was ~~working~~added ~~capital purposes as well as professional fees and other fees and expenses with respect~~ to the ~~transactions~~principal ~~contemplated~~balance byof the ~~Joinder~~ ~~and Second Amendment~~Note. AtIn ~~issuance~~November ~~the Company recognized $250~~2023,~~000~~ inthe ~~OID~~maturity ~~and~~date ~~$220,000 in debt issuance. The total unamortized debt discount was $78,335~~ and ~~$313,334 as of April 30, 2023 and July 31, 2022, respectively. The~~ principal ~~balance~~payments on the ~~Term Loan C~~ Note ~~was~~were ~~$10,935,640 and~~extended ~~$10,000,000~~to asDecember ~~of April 30, 2023 and July~~ 31, ~~2022 and had accrued PIK interest outstanding of $935,640 and $199,413, respectively. The Term Loan C Note has a maturity date of August 4,~~ 2023~~, and an interest rate of Term SOFR (with a minimum rate of 3~~.~~5%) plus twelve percent (12%).~~

~~For further details regarding the Credit Agreement,~~NOTE as7 ~~amended~~– ~~through~~RELATED ~~May~~PARTY ~~1, 2023, please see the section of Note 2 titled “Management Plans to Continue as a Going Concern.”~~TRANSACTIONS

~~Promissory~~On ~~Notes~~December –31, ~~Next~~2021, ~~Level~~as ~~Internet~~a result of the of the ~~Acquisition~~acquisition of Skynet’s assets, the two sellers became related parties as they continued to be involved as consultants for 12 months to manage the customer relationship. The Company will pay $100,000 to each of the consultants on an annual basis. As of October 31, 2023 and July 31, 2023, there were no outstanding balances owed to the consultants. Part of the Purchase Price of $600,000 (the “Earn-out Amount”) was retained by the Company and will be paid to sellers in six equal quarterly payments. An additional $100,000 (the “Holdback Amount”) was retained by the Company and will be paid to sellers in accordance with the Skynet asset purchase agreement. The Company amortized $0 and $9,922 of debt discount as interest expense during the three months ended October 31, 2023 and 2022, respectively. The total debt discount outstanding as of October 31, 2023 and July 31, 2023, was $0. The total balance outstanding on the Earn-out Amounts as of October 31, 2023 and July 31, 2023 was $400,000 and $400,000, respectively. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023.

~~On February 4, 2022, as per the acquisition of~~Acquisition ~~Next~~Payable ~~Level,~~– ~~the~~Skynet Company entered into two unsecured promissory notes (the “Unsecured Adjustable Promissory Notes”) for $1,800,000 and $200,000, respectively. The notes are payable in eight equal quarterly installments in the aggregate amount of $250,000 each commencing on June 4, 2022, through and including March 7, 2024, with a base annual interest rate of 0% and a default annual interest rate of 18%. The amount owed is subject to change based on certain revenue milestones required to be achieved by Next Level. At issuance, the Company fair valued the notes and recognized a debt discount of $241,000 which is amortized over the term of the notes. The Company amortized $90,375 to interest expense during the nine months ended April 30, 2023. Total unamortized debt discount on the notes as of April 30, 2023 and July 31, 2022 was $90,375 and $180,750, respectively. The total principal balance outstanding as of April 30, 2023 and July 31, 2022 on the Unsecured Adjustable Promissory Notes was $1,250,000 and $1,750,000, respectively.

OnAs part ~~January~~of 3,the ~~2023~~acquisition of Skynet’s assets, the Company ~~amended~~will ~~its~~pay ~~forbearance~~to the seller a $1,000,000 (the “Share Payment”) by ~~agreement~~issuance ~~with~~of restricted shares of the ~~Noteholders~~Company’s ~~and~~common ~~agreed~~stock to ~~pay~~ the ~~deferred~~owners. ~~payment~~On September 1, ~~together~~2022, the Company and the sellers amended the Asset Purchase Agreement. In accordance with ~~interest~~the atamended agreement, the ~~rate~~Share Payment will be made via the issuance of ~~18%~~shares ~~per~~on the ~~annum~~earlier of (~~based~~i) ~~upon~~ the ~~number~~effective date of ~~days~~that ~~elapsed~~certain ~~between~~Registration Statement on Form S-1 filed by the ~~date~~Company with the ~~deferred~~Securities ~~payment~~and Exchange isCommission ~~scheduled~~on ~~for~~August ~~payment~~11, ~~under~~2021 (in which case the ~~Notes~~stock ~~and~~will be valued at the ~~date~~price set forth in the ~~deferred~~prospectus ~~payment~~ that is ~~actually~~a ~~paid~~part of ~~and~~such aRegistration ~~year~~Statement, ofwithout ~~360~~underwriter ~~days~~discounts) and ~~extension~~(ii) ~~fees~~April 30, 2023 (in which case the stock will be valued at the average of ~~$7,500~~the last transaction price on orthe ~~before~~OTCQB ~~February~~for ~~28,~~each ~~2023~~of (the ~~period~~10 ~~from~~trading ~~the~~days ~~effective~~immediately preceding such issuance date). On December ~~through~~5, ~~February~~2022 28and March 9, 2023), the Asset Purchase Agreement was amended. ~~This~~The ~~deferral~~payments ofdue ~~payment~~were ~~resulted~~originally inextended anuntil ~~additional~~the ~~principal~~closing ~~added~~of the merger with MEOA which was expected to close during the ~~balance~~second quarter of ~~$26~~calendar year 2023. On June 15,~~125~~ 2023, ~~which~~Digerati ~~consisted~~terminated the ofBusiness Combination Agreement with MEOA. On November 22, 2023, the ~~extension~~maturity ~~fee~~date on the Note was extended to December 31, 2023. The total principal balance outstanding on the acquisitions payable as of $7October 31,~~500~~ 2023 and ~~interest~~July ~~expense~~31, of2023 was $181,~~625~~000,000.

OnNOTE ~~February~~8 ~~28,~~– ~~2023,~~CONVERTIBLE ~~the~~NOTES Company extended the payment date for the September 4, 2022 installment to be due by April 30, 2023 (forbearance amendment no. 2) in exchange for a $15,000 amendment fee to be added to the outstanding principal balance. This deferral of payment resulted in an additional principal added to the balance of $39,000, which consisted of the extension fee of $15,000 and interest expense of $24,000. The $39,000 balance was paid on March 15, 2023.PAYABLE

OnAs ~~March~~of 7,October ~~2023~~31, ~~the Company extended the payment date for the March 7,~~ 2023 ~~installment~~and toJuly ~~be due by April 30~~31, 2023 ~~in exchange for a $7~~,~~500~~ ~~amendment~~convertible ~~fee~~notes ~~to be added to the outstanding~~payable ~~principal balance. This deferral of payment resulted in an additional principal added to the balance of $8,500, which~~ consisted of the ~~extension~~ ~~fee of $7,500 and interest expense of $1,000. The $8,500 balance was paid on March 15, 2023.~~following:

On May 1, 2023, the Company extended the payment date for the September 4, 2022 installment to be due by May 31, 2023 (forbearance amendment no. 3) in exchange for payment of accrued interest between March 15, 2023 and April 30, 2023 of $5,750.00 which was paid on May 10, 2023.

	October 31,		July 31,
CONVERTIBLE NOTES PAYABLE NON-DERIVATIVE	2023		2023

On October 13, 2020, the Company entered into a variable convertible promissory note with an aggregate principal amount of $330,000, an annual interest rate of 8%, and an original maturity date of October 13, 2021. In connection with the execution of the Note, the Company issued 1,000,000 shares of our common stock to the Noteholder, and recognized $211,426 of debt discount related to the original issue discount, relative fair market value of shares, and the intrinsic value of the conversion feature of the Note, which was amortized over the term of the Note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into common stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.05 or 85% of the lowest trading price for the ten (10) trading day period immediately preceding the conversion date. The maturity date was extended multiple times and during the last fiscal year, the lender agreed to extend the maturity until July 31, 2023. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (See below conversion terms No.1). (1) (2) (3)	$	173,250	$	173,250

On January 27, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $250,000, an annual interest rate of 8%, and a maturity date of January 27, 2022. In connection with the execution of the Note, the Company issued 500,000 shares of our common stock to the Noteholder, and at the time of issuance, the Company recognized the relative fair market value of the shares of $24,368 as debt discount and $44,368 as debt discount for the intrinsic value of the conversion feature, which both were amortized to interest expense during the term of the Note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into common stock at any time after 180 days of funding the Note. The conversion price shall be the greater of $0.05 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder shall, in its sole discretion, be able to convert any amounts due hereunder at a twenty-five percent (25%) discount to the per share price of the Qualified Uplisting Financing. The maturity date was extended multiple times. On February 1, 2023, the lender agreed to extend the maturity until July 30, 2023. As consideration for the extension on the Note, the Company agreed to add $50,000 to the principal amount outstanding and issued 300,000 shares of common stock with a market value of $26,460, both of which, were charged to interest expense. The Company analyzed the Note and determined that it does not require to be accounted as a derivative instrument. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (2) (3)		375,000		375,000

On May 1, 2023, the Company extended the payment date for the March 7, 2023 installment to be due by May 31, 2023 (forbearance amendment no. 1) in exchange for payment of accrued interest between March 15, 2023 and April 30, 2023 of $5,750.00 which was paid on May 10, 2023.19

On June 1, 2023, the Company and the Noteholders agreed to extend the due date for the principal payment along with accrued interest due on May 31, 2023 to June 30, 2023.

On April 14, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $250,000, an annual interest rate of 8%, and a maturity date of April 14, 2022. In connection with the execution of the Note, the Company issued 500,000 shares of our common stock to the Noteholder, at the time of issuance, the Company recognized the relative fair market value of the shares of $63,433 as debt discount, and it will be amortized to interest expense during the term of the Note. Additionally, the Company recognized $96,766 as debt discount for the intrinsic value of the conversion feature, and it will be amortized to interest expense during the term of the Note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into common stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The maturity date has been extended multiple times. On April 14, 2023, the lender agreed to extend the maturity until October 14, 2023. As consideration for the extension on the Note, the Company agreed to add $50,000 to the principal amount outstanding and issued 300,000 shares of common stock with a market value of $23,670, both of which, were charged to interest expense. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (2) (3)	375,000	375,000

On August 31, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $75,000, an annual interest rate of 8% (and a default interest rate of 20%), and a maturity date of August 31, 2022. In connection with the execution of the Note, the Company issued 150,000 shares of our common stock to the Noteholder, and at the time of issuance, the Company recognized the relative fair market value of the shares of $13,635 as debt discount, which will be amortized to interest expense during the term of the promissory note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into common stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder may elect to convert up to 100% of the principal plus accrued interest into the common stock into a qualified uplist financing at a 25% discount. The maturity date has been extended multiple times. On February 28, 2023, the lender agreed to extend the maturity until August 31, 2023. As consideration for the extension on the Note, the Company agreed to add $18,000 to the principal amount outstanding and issued 100,000 shares of common stock with a market value of $8,200, both of which, were charged to interest expense. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (2) (3)	108,000	108,000

On September 29, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $75,000, an annual interest rate of 8%, a default interest rate of 20%, and a maturity date of September 29, 2022. In connection with the execution of the Note, the Company issued 150,000 shares of our common stock to the Noteholder, at the time of issuance, the Company recognized the relative fair market value of the shares of $10,788 as debt discount, and it will be amortized to interest expense during the term of the promissory note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into common stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder may elect to convert up to 100% of the principal plus accrued interest into the common stock into a qualified uplist financing at a 25% discount. The maturity date has been extended multiple times. On March 29, 2023, the lender agreed to extend the maturity until September 29, 2023. As consideration for the extension on the Note, the Company agreed to add $18,000 to the principal amount outstanding and issued 100,000 shares of common stock with a market value of $7,970, both of which, were charged to interest expense. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (2) (3)	108,000	108,000

~~NOTE 7 – RELATED PARTY TRANSACTIONS~~20

On December 29, 2022, the Company entered into a $100,000 promissory note, with the Company’s president, Derek Gietzen, with a maturity date of January 12, 2023, and annual interest rate of 12%. On January 17, 2023, the Company paid the total principal outstanding of $100,000, plus accrued interest.

On October 22, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $150,000, an annual interest rate of 8% (and a default interest rate of 20%), and a maturity date of October 22, 2022. In connection with the execution of the Note, the Company issued 300,000 shares of our common stock to the note holder, and at the time of issuance, the Company recognized the relative fair market value of the shares of $13,965 as debt discount, which will be amortized to interest expense during the term of the promissory note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into common stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder may elect to convert up to 100% of the principal plus accrued interest into the common stock into a qualified uplist financing at a 25% discount. The maturity date has been extended multiple times. On April 29, 2023, the lender agreed to extend the maturity until October 29, 2023. As consideration for the extension on the Note, the Company agreed to add $30,000 to the principal amount outstanding and issued 180,000 shares of common stock with a market value of $12,582, both of which, were charged to interest expense. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (2) (3)	210,000	210,000

On February 4, 2022, as part the acquisition of NLI, the Company entered into two unsecured convertible promissory notes (the “Unsecured Convertible Promissory Notes”) for $1,800,000 and $200,000, respectively. The Notes are payable in eight equal quarterly installments in the aggregate amount of $250,000 with the first payment commencing on April 30, 2022, through and including January 31, 2024. The Notes have a base annual interest rate of 0% and a default interest rate of 18%. The Sellers have a one-time right to convert all or a portion of the Convertible Notes commencing on the six-month anniversary of the notes being issued and ending 30 days after such six-month anniversary. The conversion price means an amount equal to the volume weighted average price per share of Stock on the Nasdaq Stock Market for the ten (10) consecutive trading days on which the conversion notice is received by the Company. However, if the stock is not then listed for trading on the Nasdaq Stock Market, the Conversion Price shall be the volume weighted average transaction price per share reported by the OTC Reporting Facility for the ten (10) consecutive trading days immediately preceding the date on which such Conversion Notice is received by the Company. At inception of the Notes, the Company recognized the fair market value of the conversion on the notes of $2,382,736, and recognized $117,264 in debt discount, which was amortized over the conversion period. During the year ended July 31, 2023, the conversion option on the Notes ended, and the Company recognized $466,086 as other income for the settlement of the conversion option. During the year ended July 31, 2023, the Company made principal payments totaling $791,375. On May 1, 2023, lenders agreed to forbear the principal payment of $250,000 originally due on April 30, 2023 to May 31, 2023. On June 1, 2023, the Company and the Noteholders agreed to extend the due date for the principal payment along with accrued interest due on May 31, 2023 to June 30, 2023. During the three months ended October 31, 2023, an additional $34,500 was added to the principal balance for default interest for missing principal payments on the Notes. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (3)	1,034,500	1,000,000

On October 4, 2022, the Company entered into a $150,000 promissory note, with the Company’s president, Derek Gietzen, with a maturity date of October 15, 2022, and annual interest rate of 11%. On October 17, 2022, the Company paid the total principal outstanding of $150,000, plus accrued interest.21

During the nine months ended April 30, 2023 and 2022, the Company provided VoIP Hosted and fiber services to a Company owned by one of the Board members of Verve Cloud (the Nevada entity) for $118,619 and $144,687, respectively.

On January 21, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $230,000, an annual interest rate of 8%, and a maturity date of October 21, 2022. After payment of transaction-related expenses and closing fees of $26,300, net proceeds to the Company from the Note totaled $203,700. Additionally, the Company recorded $26,300 as a discount to the Note and amortized over the term of the Note. In connection with the execution of the Note, the Company issued 300,000 shares of our common stock to the Noteholder and recorded $30,446 as debt discount and amortized over the term of the Note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of common stock. The Note Conversion Price shall be $0.10. Upon the occurrence of an Event of Default, the outstanding balance shall immediately increase to 125% of the Outstanding Balance immediately prior to the occurrence of the Event of Default and a daily penalty of $500 will accrue until the default is remedied. The maturity date has been extended multiple times. On January 30, 2023, the lender agreed to extend the maturity until May 30, 2023. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $30,000 and issued 300,000 shares of common stock with a fair market value of $26,910, both of which, were charged to interest expense. On May 30, 2023, the Company and the Noteholders agreed to extend the due date for the principal payment due on May 30, 2023 to September 30, 2023. In exchange for the extension of the due date, $30,000 was added to the principal and the Company issued 300,000 shares of common stock with a fair market value of $26,700. Subsequent to October 31, 2023, the maturity date of the Note was extended to December 31, 2023. (1) (2) (3)	320,000	320,000

On January 21, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $230,000, an annual interest rate of 8%, and a maturity date of October 21, 2022. After payment of transaction-related expenses and closing fees of $26,300, net proceeds to the Company from the Note totaled $203,700. Additionally, the Company recorded $26,300 as a discount to the Note and amortized over the term of the Note. In connection with the execution of the Note, the Company issued 300,000 shares of our common stock to the Not holder and recorded $30,446 as debt discount and amortized over the term of the Note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of common stock. The Note Conversion Price shall be equal $0.10. Upon the occurrence of an Event of Default, the outstanding balance shall immediately increase to 125% of the Outstanding Balance immediately prior to the occurrence of the Event of Default and a daily penalty of $500 will accrue until the default is remedied. The maturity date has been extended multiple times. On January 30, 2023, the lender agreed to extend the maturity until May 30, 2023. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $30,000 and issued 300,000 shares of common stock with a fair market value of $26,910, both of which, were charged to interest expense. On May 30, 2023, the Company and the Noteholders agreed to extend the due date for the principal payment due on May 30, 2023 to September 30, 2023. In exchange for the extension of the due date, $30,000 was added to the principal and the Company issued 300,000 shares of common stock with a fair market value of $26,700. Subsequent to October 31, 2023, the maturity date of the Note was extended to December 31, 2023. (1) (2) (3)	320,000	320,000

On ~~November~~July 1727, ~~2020~~2022, asthe Company entered into a ~~result~~variable ofconvertible ~~the~~promissory ofnote ~~the~~with ~~acquisition~~ an aggregate principal amount of ~~the~~$165,000, ~~assets~~an annual interest rate of ~~ActiveServe~~8%, ~~Inc.~~and ~~(“ActiveServe”)~~a maturity date of April 27, ~~the~~2023. ~~two~~After ~~sellers~~payment ~~became~~of transaction-related ~~parties~~expenses asand ~~they~~closing ~~continued~~fees toof be$19,500, ~~involved as~~net ~~consultants~~proceeds to ~~manage~~ the ~~customer~~Company ~~relationship,~~from the ~~Company~~Note ~~paid~~totaled on$145,500. anAdditionally, ~~annual~~the ~~basis~~Company ~~$90~~issued 300,000 toshares ~~each~~ of our common stock to the ~~consultants~~Noteholder. ~~These~~The ~~agreements expired~~Company recorded the $19,500 and the ~~parties~~relative ~~agreed~~fair ~~not~~market tovalue ~~extend.~~of Asthe shares of ~~April 30~~$22,093 ~~2023,~~as ~~there’s~~debt nodiscount ~~balance~~and ~~outstanding~~amortized ~~under~~to interest expense over the ~~consulting~~term ~~agreements~~of the Note. In ~~addition,~~Until ~~part~~the earlier of 6 months or the ~~Purchase~~ ~~Price~~Company islisting ~~payable in~~on 8Nasdaq ~~equal~~or ~~quarterly~~NYSE ~~payments~~American, the note holder shall be entitled to convert any portion of the ~~sellers~~outstanding and unpaid conversion amount into fully paid and nonassessable shares of common stock. ~~During~~The Note conversion price shall equal the ~~nine~~greater ~~months~~of ~~ended April~~$0.10 ~~30,~~or ~~2023,~~ 25% discount to up-listing price or offering/underwriting price concurrent with the Company ~~paid~~listing ~~$217~~on Nasdaq or NYSE American,~~593~~ ofsubject ~~the~~to ~~principal~~adjustment ~~balance~~as ~~outstanding~~provided in the Note. ItThe ~~was~~maturity ~~determined~~date ~~during~~has ~~the~~been ~~quarter~~extended ~~ended~~multiple times. On April 30 25, 2023, ~~that~~ the ~~required~~lender ~~revenue~~agreed ~~targets~~to ~~were~~extend ~~not~~the ~~met~~maturity until July 31, 2023. AsIn aconnection ~~result~~with the extension of the maturity date on the Note, the Company ~~recognized~~agreed ato ~~gain~~increase onthe ~~settlement~~principal balance by $30,000 and issued 300,000 shares of ~~debt~~common stock with a fair market value of $5421,~~907 which~~000, ~~was~~both ~~the~~of ~~remaining~~which, ~~accrued~~were ~~amount~~charged ~~outstanding~~to interest expense. ~~The~~Subsequent ~~total~~to ~~principal~~October ~~outstanding~~31, on2023, the ~~notes~~maturity asdate of ~~April~~the ~~30,~~Note ~~2023~~was ~~and~~extended ~~July~~to December 31, ~~2022 was~~2023. $0(1) ~~and~~(2) ~~$272~~(3) 195,~~500,~~000 ~~respectively.~~195,000

On December 31, 2021, as a result of the of the acquisition of Skynet’s assets, the two sellers became related parties as they continued to be involved as consultants for 12 months to manage the customer relationship. The Company will pay $100,000 to each of the consultants on an annual basis. As of April 30, 2023, there were no outstanding balances owed to the consultants. Part of the Purchase Price of $600,000 (the “Earn-out Amount”) was retained by the Company and will be paid to sellers in six equal quarterly payments. An additional $100,000 (the “Holdback Amount”) was retained by the Company and will be paid to sellers in accordance with the Skynet asset purchase agreement. During the nine months ended April 30, 2023, the Company paid $100,000 of the principal balance outstanding. The Company amortized $29,764 and $0 of debt discount as interest expense during the nine months ended April 30, 2023 and April 30, 2022, respectively. The total debt discount outstanding as of April 30, 2023 and July 31, 2022, was $9,921 and $39,686, respectively. The total balance outstanding on the Earn-out Amounts as of April 30, 2023 and July 31, 2022, was $500,000 and $600,000, respectively.22

On September 12, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $75,000, an annual interest rate of 8%, and a maturity date of September 12, 2023. In connection with the execution of the Note, the Company issued 150,000 shares of our common stock to the note holder, at the time of issuance, the Company recognized the relative fair market value of the shares of $15,880 as debt discount, and it will be amortized to interest expense during the term of the promissory Note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into common stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder may elect to convert up to 100% of the principal plus accrued interest into shares of common stock into a qualified uplist financing at a 25% discount. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (3)	75,000	75,000

On October 3, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $165,000, an annual interest rate of 8%, and a maturity date of July 3, 2023. After payment of transaction-related expenses and closing fees of $19,500, net proceeds to the Company from the Note totaled $145,500. Additionally, the Company issued 300,000 shares of our common stock to the note holder. The Company recorded the $19,500 and the relative fair market value of the shares of $32,143 as debt discount and amortized to interest expense over the term of the Note. The Company recognized $117,857 debt discount related to beneficial conversion feature and will be amortized to interest expense over the term of Note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of common stock. The Note conversion price shall equal the greater of $0.10 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the Note. Subsequent to October 31, 2023, the maturity date of the Note was extended to December 31, 2023. (1) (3)	165,000	165,000

Acquisition Payable – Skynet

On October 27, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $38,500, an annual interest rate of 8%, and a maturity date of July 26, 2023. After payment of transaction-related expenses and closing fees of $3,500, net proceeds to the Company from the Note totaled $25,000. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of common stock. The Note conversion price shall equal the greater of $0.10 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the Note Subsequent to October 31, 2023, the maturity date of the Note was extended to December 31, 2023. (1) (3)	38,500	38,500

On October 27, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $71,500, an annual interest rate of 8%, and a maturity date of July 26, 2023. After payment of transaction-related expenses and closing fees of $6,500, net proceeds to the Company from the Note totaled $65,000. Additionally, the Company issued 200,000 shares of our common stock to the Noteholder. The Company recorded the $6,500 and the relative fair market value of the shares of $38,768 as debt discount and amortized to interest expense over the term of the Note. The Company recognized $40,888 debt discount related to beneficial conversion feature and will be amortized to interest expense over the term of Note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of common stock. The Note conversion price shall equal the greater of $0.10 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the Note. Subsequent to October 31, 2023, the maturity date of the Note was extended to December 31, 2023. (1) (3)	71,500	71,500

As part of the acquisition of Skynet’s assets, the Company will pay to the seller a $1,000,000 (the “Share Payment”) by issuance of restricted shares of the Company’s common stock to the owners. On September 1, 2022, the Company and the sellers amended the Asset Purchase Agreement. In accordance with the amended agreement, the Share Payment will be made via the issuance of shares on the earlier of (i) the effective date of that certain Registration Statement on Form S-1 filed by the Company with the Securities and Exchange Commission on August 11, 2021 (in which case the stock will be valued at the price set forth in the prospectus that is a part of such Registration Statement, without underwriter discounts) and (ii) April 30, 2023 (in which case the stock will be valued at the average of the last transaction price on the OTCQB for each of the 10 trading days immediately preceding such issuance date). On December 5, 2022 and March 9, 2023, the Asset Purchase Agreement was amended. The payments due will be extended until the closing of the merger with Minority Equality Opportunities Acquisition (“MEOA”) which is expected to close during the second quarter of calendar year 2023. The total principal balance outstanding on the acquisitions payable as of April 30, 2023 and July 31, 2022, was $1,000,000.23

~~NOTE~~On 8October –31, ~~CONVERTIBLE~~2022, ~~NOTES~~the ~~PAYABLE~~Company entered into a variable convertible promissory note with an aggregate principal amount of $350,000, an annual interest rate of 14%, and a maturity date of February 28, 2023. Net proceeds to the Company from the Note totaled $350,000. In the event that any payment is not made when due, either of principal or interest, and whether upon maturity or as a result of acceleration, interest shall thereafter accrue at the rate per annum equal to the lesser of (a) the maximum non-usurious rate of interest permitted by the laws of the State of Texas or the United States of America, whichever shall permit the higher rate or (b) twenty percent (20%) per annum, from such date until the entire balance of principal and accrued interest on this Note has been paid. At any time after sixty (60) days following the date hereof, Payee may elect to convert a percentage of the amount of principal and accrued interest outstanding on the Note into common stock of Debtor, in accordance with the following terms: (i) If prior to uplist to Nasdaq or NYSE, Payee may convert up to 50% of the amount outstanding on the Note into common stock. In such event, the price per share of common stock applicable to such conversion (the “Applicable Conversion Price”) shall be the greater of: (a) the Variable Conversion Price or (b) the Fixed Conversion Price. The “Variable Conversion Price” shall be equal to a 20% discount to the average closing price for common stock for the five (5) Trading Day period immediately preceding the Conversion Date. The Fixed Conversion Price shall equal $0.0956; and (ii) If following the Uplist, Payee may convert up to 100% of the amount outstanding on the Note into shares of common stock. In such event, the Applicable Conversion Price shall be the greater of: (a) the post-Uplist Variable Conversion Price (i.e., if less than 5 days after the Uplist, then the average of the days available since the Uplist up to 5) or (b) the Fixed Conversion Price. On March 30, 2023, the maturity date was extended to May 30, 2023. In connection with the extension, the Company issued 2,500,000 warrant shares to the Noteholder and recognized the fair market value of the warrant shares of $170,000 as debt extension fee. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (2) (3) 350,000 350,000

At April 30, 2023 and July 31, 2022, convertible notes payable consisted of the following:

On November 22, 2022, the Company entered into a convertible promissory note with an aggregate principal amount of $1,670,000, an annual interest rate of 10%, and a maturity date of November 22, 2023. The Company recorded $90,975 in transaction-related expenses and closing fees and $250,500 of original issue discount to the Note. After payment of transaction-related expenses and closing fees and original issue discount, net proceeds to the Company from the Note totaled $1,328,525 In connection with the execution of the Note, the Company issued 2,100,000 shares of our common stock and 10,500,000 warrant shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the shares of common stock and warrant shares of $640,877 as debt discount. Additionally, the Company recognized $687,648 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the Note. As amended on March 24, 2023, the Noteholder shall have the right, on or before the earlier of (i) the closing of the SPAC Transaction (as defined in that certain business combination agreement between the Company, Minority Equality Opportunities Acquisition Inc., and MEOA Merger Sub, Inc. dated on or around August 30, 2022 (the “SPAC Agreement”, and the transaction contemplated under the SPAC Agreement, the “SPAC Transaction”)) or (ii) March 22, 2023, to convert all or any portion of the Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of common stock. The Note conversion price shall equal $0.0956 subject to adjustment as provided in the note. On April 24, 2023, the Noteholder agreed to extend the due date for the first principal payment to May 22, 2023. In connection with the extension of the due date of the first principal on the Note, the Company agreed to increase the principal balance by $20,000. Subsequent to October 31, 2023, the maturity date and principal payments on the Note were extended to December 31, 2023. (1) (2) (3)	1,670,000	1,670,000

On December 12, 2022, the Company entered into a convertible promissory note with an aggregate principal amount of $117,647, annual interest rate of 10% and a maturity date of December 12, 2023. The Company recorded $17,647 as original issue discount to the Note, which resulted in net proceeds of $100,000. In connection with the execution of the note, the Company issued 148,295 shares of our common stock and 741,475 warrant shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the common stock and warrant shares of $41,685 as debt discount. Additionally, the Company recognized $58,315 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the Note. The Noteholder shall have the right, on any calendar day, at any time on or following the earlier of (i) April 12, 2023 or (ii) sixty (60) calendar days after the Closing Date (as defined in that certain business combination agreement between the Company, Minority Equality Opportunities Acquisition Inc., and MEOA Merger Sub, Inc. dated on or around August 30, 2022 (the “SPAC Agreement”, and the transaction contemplated under the SPAC Agreement, the “SPAC Transaction”), to convert all or any portion of the Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of common stock. The Note conversion price shall equal $0.0956, subject to adjustment as provided in the note. Subsequent to October 31, 2023, the maturity date and principal payments on the Note were extended to December 31, 2023. (1) (3)	119,897	119,897

	April 30,		July 31,
CONVERTIBLE NOTES PAYABLE NON-DERIVATIVE	2023		2022
On October 13, 2020, the Company entered into a variable convertible promissory note with an aggregate principal amount of $330,000, an annual interest rate of 8%, and an original maturity date of October 13, 2021. In connection with the execution of the Note, the Company issued 1,000,000 shares of our Common Stock to the Noteholder, and recognized $211,426 of debt discount related to the original issue discount, relative fair market value of shares, and the intrinsic value of the conversion feature of the Note, which was amortized over the term of the Note. The maturity date was extended multiple times and during the current quarter, the lender agreed to extend the maturity until July 31, 2023. (See below variable conversion terms No.1) (1) (2) (3)	$	165,000	$	165,000
On January 27, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $250,000, an annual interest rate of 8%, and a maturity date of January 27, 2022. In connection with the execution of the Note, the Company issued 500,000 shares of our Common Stock to the Noteholder, and at the time of issuance, the Company recognized the relative fair market value of the shares of $24,368 as debt discount and $44,368 as debt discount for the intrinsic value of the conversion feature, which both were amortized to interest expense during the term of the Note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into Common Stock at any time after 180 days of funding the Note. The conversion price shall be the greater of $0.05 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder shall, in its sole discretion, be able to convert any amounts due hereunder at a twenty-five percent (25%) discount to the per share price of the Qualified Uplisting Financing. The maturity date was extended multiple times. Most recently, on February 1, 2023, the lender agreed to extend the maturity until July 30, 2023. As consideration for the extension on the Note, the Company agreed to add $50,000 to the principal amount outstanding and issued 300,000 shares of Common Stock with a market value of $26,460, both of which, were charged to interest expense. The Company analyzed the Note and determined that it does not require to be accounted as a derivative instrument. (1) (2) (3)		375,000		275,000

On December 20, 2022, the Company entered into a convertible promissory note with an aggregate principal amount of $176,471, an annual interest rate of 10%, and a maturity date of December 20, 2023. The Company recorded $5,000 in deferred finance costs and $26,471 of original issue discount to the Note. After payment of transaction-related expenses, net proceeds to the Company from the Note totaled $145,500. In connection with the execution of the Note, the Company issued 221,909 shares of our common stock and 1,109,545 warrant shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the common stock and warrant shares of $59,374 as debt discount. Additionally, the Company recognized $79,014 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the Note. The Noteholder shall have the right, on any calendar day, at any time on or following the earlier of (i) April 12, 2023 or (ii) sixty (60) calendar days after the closing of the Merger, to convert all or any portion of the Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of common stock. The Note conversion price shall equal to $0.0956, subject to adjustment as provided in the Note. In connection with the extension of the principal payment due date on the Note, the Company agreed to increase the principal balance by $10,000. Subsequent to October 31, 2023, the maturity date and principal payments on the Note were extended to December 31, 2023. (1) (2) (3) 186,471 186,471

On April 14, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $250,000, an annual interest rate of 8%, and a maturity date of April 14, 2022. In connection with the execution of the Note, the Company issued 500,000 shares of our Common Stock to the Noteholder, at the time of issuance, the Company recognized the relative fair market value of the shares of $63,433 as debt discount, and it will be amortized to interest expense during the term of the Note. Additionally, the Company recognized $96,766 as debt discount for the intrinsic value of the conversion feature, and it will be amortized to interest expense during the term of the Note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into Common Stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The maturity date has been extended multiple times. Most recently, on April 14, 2023, the lender agreed to extend the maturity until October 14, 2023. As consideration for the extension on the Note, the Company agreed to add $50,000 to the principal amount outstanding and issued 300,000 shares of Common Stock with a market value of $23,670, both of which, were charged to interest expense. (1) (2) (3)	375,000	275,000
On December 22, 2022, the Company entered into a convertible promissory note with an aggregate principal amount of $188,235, annual interest rate of 10% and a maturity date of December 22, 2023. The Company recorded $10,000 in transaction-related expenses and closing fees and $28,235 of original issue discount to the Note. After payment of transaction-related expenses and closing fees and original issue discount, net proceeds to the Company from the Note totaled $150,000. In connection with the execution of the note, the Company issued 236,703 shares of our common stock and 1,183,515 warrant shares to the holder at the time of issuance. The Company recognized the relative fair market value of the common stock and warrant shares of $66,679 as debt discount. Additionally, the Company recognized $83,321 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Holder shall have the right, on any calendar day, at any time on or following the earlier of (i) April 22, 2023 or (ii) sixty (60) calendar days after the Closing Date of the Merger, to convert all or any portion of the Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of common stock. The Note conversion price shall equal $0.0956, subject to adjustment as provided in the Note. On March 22, 2023, the Noteholder agreed to extend the maturity date until June 22, 2023 or the closing of the Company’s business combination with MEOA. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $3,750. Subsequent to October 31, 2023, the maturity date and principal payments on the Note were extended to December 31, 2023. (1) (2) (3)	191,985	191,985
On August 31, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $75,000, an annual interest rate of 8% (and a default interest rate of 20%), and a maturity date of August 31, 2022. In connection with the execution of the Note, the Company issued 150,000 shares of our Common Stock to the Noteholder, and at the time of issuance, the Company recognized the relative fair market value of the shares of $13,635 as debt discount, which will be amortized to interest expense during the term of the promissory note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into Common Stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder may elect to convert up to 100% of the principal plus accrued interest into the Common Stock into a qualified uplist financing at a 25% discount. The maturity date has been extended multiple times. Most recently, on February 28, 2023, the lender agreed to extend the maturity until August 31, 2023. As consideration for the extension on the Note, the Company agreed to add $18,000 to the principal amount outstanding and issued 100,000 shares of Common Stock with a market value of $8,200, both of which, were charged to interest expense. (1) (2) (3)	108,000	75,000
On January 13, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $110,000, an annual interest rate of 10%, and a maturity date of October 13, 2023. The Company recorded $10,000 in original issue discount to the Note. After payment of the original issue discount, net proceeds to the Company from the Note totaled $100,000. In connection with the execution of the Note, the Company issued 138,000 shares of our common stock shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the shares of common stock of $11,177 as debt discount. Additionally, the Company recognized $21,507 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the Note. The Noteholder shall have the right, on any calendar day, at any time on or following the earlier of (i) May 12, 2023 or (ii) sixty (60) calendar days after listing on Nasdaq or the New York Stock Exchange to convert any portion of the outstanding and unpaid Conversion into fully paid and nonassessable shares of common stock, at the Conversion Price. The Note conversion price shall equal $0.10, subject to adjustment as provided in the Note. Subsequent to October 31, 2023, the maturity date of the Note was extended to December 31, 2023. (1) (3)	110,000	110,000
On September 29, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $75,000, an annual interest rate of 8%, a default interest rate of 20%, and a maturity date of September 29, 2022. In connection with the execution of the Note, the Company issued 150,000 shares of our Common Stock to the Noteholder, at the time of issuance, the Company recognized the relative fair market value of the shares of $10,788 as debt discount, and it will be amortized to interest expense during the term of the promissory note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into Common Stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder may elect to convert up to 100% of the principal plus accrued interest into the Common Stock into a qualified uplist financing at a 25% discount. The maturity date has been extended multiple times. Most recently, on March 29, 2023, the lender agreed to extend the maturity until September 29, 2023. As consideration for the extension on the Note, the Company agreed to add $18,000 to the principal amount outstanding and issued 100,000 shares of Common Stock with a market value of $7,970, both of which, were charged to interest expense. (1) (2) (3)	108,000	75,000

2125

On October 22, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $150,000, an annual interest rate of 8% (and a default interest rate of 20%), and a maturity date of October 22, 2022. In connection with the execution of the Note, the Company issued 300,000 shares of our Common Stock to the note holder, and at the time of issuance, the Company recognized the relative fair market value of the shares of $13,965 as debt discount, which will be amortized to interest expense during the term of the promissory note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into Common Stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder may elect to convert up to 100% of the principal plus accrued interest into the Common Stock into a qualified uplist financing at a 25% discount. The maturity date has been extended multiple times. Most recently, on April 29, 2023, the lender agreed to extend the maturity until October 29, 2023. As consideration for the extension on the Note, the Company agreed to add $30,000 to the principal amount outstanding and issued 180,000 shares of Common Stock with a market value of $12,582, both of which, were charged to interest expense. (1) (2) (3)	210,000	150,000
On February 4, 2022, as part the acquisition of NLI, the Company entered into two unsecured convertible promissory notes (the “Unsecured Convertible Promissory Notes”) for $1,800,000 and $200,000, respectively. The Notes are payable in eight equal quarterly installments in the aggregate amount of $250,000 with the first payment commencing on April 30, 2022, through and including January 31, 2024. The Notes have a base annual interest rate of 10% and a default annual interest rate of 18%. The lenders have a one-time right to convert all or a portion of the Convertible Notes commencing on the six-month anniversary of the notes being issued and ending 30 days after such six-month anniversary. The conversion price means an amount equal to the volume weighted average price per share of Stock on the Nasdaq Stock Market for the ten (10) consecutive trading days on which the conversion notice is received by the Company. However, if the stock is not then listed for trading on the Nasdaq Stock Market, the Conversion Price shall be the volume weighted average transaction price per share reported by the OTC Reporting Facility for the ten (10) consecutive trading days immediately preceding the date on which such Conversion Notice is received by the Company. At inception of the Notes, the Company recognized the fair market value of the conversion on the notes of $2,382,736, and recognized $117,264 in debt discount, which was amortized over the conversion period. As of the nine months ended April 30, 2023, the conversion option on the Notes ended, and the Company recognized $466,086 as other income for the settlement of the conversion option. During the nine months ended April 30, 2023, the Company made two principal payments totaling of $500,000. Most recently, on May 1, 2023, the lenders agreed to extend the principal payment of $250,000 originally due on April 30, 2023 to May 31, 2023. On June 1, 2023, the Company and the Noteholders agreed to extend the due date for the principal payment along with accrued interest due on May 31, 2023 to June 30, 2023. (3)	1,265,250	2,250,000
On January 21, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $230,000, an annual interest rate of 8%, and a maturity date of October 21, 2022. After payment of transaction-related expenses and closing fees of $26,300, net proceeds to the Company from the Note totaled $203,700. Additionally, the Company recorded $26,300 as a discount to the Note and amortized over the term of the Note. In connection with the execution of the Note, the Company issued 300,000 shares of our Common Stock to the Noteholder and recorded $30,446 as debt discount and amortized over the term of the Note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of Common Stock. The Note Conversion Price shall equal the greater of $0.15 (fifteen) or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the Note. Upon the occurrence of an Event of Default, the outstanding balance shall immediately increase to 125% of the Outstanding Balance immediately prior to the occurrence of the Event of Default and a daily penalty of $500 will accrue until the default is remedied. The maturity date has been extended multiple times. Most recently, on January 30, 2023, the lender agreed to extend the maturity until May 30, 2023. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $30,000 and issued 300,000 shares of Common Stock with a fair market value of $26,910, both of which, were charged to interest expense. The Company is currently working with the lender to extend the maturity date beyond May 30, 2023. There can be no assurance that we will be able to extend the maturity date. (1) (2) (3)	290,000	230,000

On January 24, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $660,000, an annual interest rate of 10%, and a maturity date of May 24, 2023. The Company recorded $60,000 in original issue discount to the Note. After payment of the original issue discount, net proceeds to the Company from the Note totaled $600,000. In connection with the execution of the Note, the Company issued 660,000 shares of our common stock shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the shares of Common stock of $53,850 as debt discount. Additionally, the Company recognized $104,610 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Payee may elect to convert up to 100% of the Principal Amount outstanding on the Note into common stock of Debtor or any shares of capital stock or other securities of the Debtor into which such common stock shall hereafter be changed or reclassified at any time on the earlier of (i) one hundred and twenty (120) calendar days following the funding of this Note or (ii) sixty (60) calendar days after the Closing Date as defined in that certain business combination agreement between the Debtor, Minority Equality Opportunities Acquisition Inc., and MEOA Merger Sub, Inc. dated on or around August 30, 2022 (the “Conversion Shares”). The Note conversion price shall equal $0.10, subject to adjustment as provided in the Note. On September 6, 2023, the Noteholder agreed to extend the maturity date until September 24, 2023. As consideration with the execution of the Note, the Company issued 495,000 shares of our common stock with a fair value of $20,790 to the Noteholder. The fair value of the issued shares was recorded as interest expense. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (2) (3)

660,000

On January 24, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $660,000, an annual interest rate of 10%, and a maturity date of May 24, 2023. The Company recorded $60,000 in original issue discount to the Note. After payment of the original issue discount, net proceeds to the Company from the Note totaled $600,000. In connection with the execution of the Note, the Company issued 660,000 shares of our common stock shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the shares of Common stock of $53,850 as debt discount. Additionally, the Company recognized $104,610 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Payee may elect to convert up to 100% of the Principal Amount outstanding on the Note into common stock of Debtor or any shares of capital stock or other securities of the Debtor into which such common stock shall hereafter be changed or reclassified at any time on the earlier of (i) one hundred and twenty (120) calendar days following the funding of this Note or (ii) sixty (60) calendar days after the Closing Date as defined in that certain business combination agreement between the Debtor, Minority Equality Opportunities Acquisition Inc., and MEOA Merger Sub, Inc. dated on or around August 30, 2022 (the “Conversion Shares”). The Note conversion price shall equal $0.10, subject to adjustment as provided in the Note. On September 6, 2023, the Noteholder agreed to extend the maturity date until September 24, 2023. As consideration with the execution of the Note, the Company issued 495,000 shares of our common stock with a fair value of $20,790 to the Noteholder. The fair value of the issued shares was recorded as interest expense. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (2) (3)	660,000	660,000

On March 7, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $110,000, annual interest rate of 10% and a maturity date of December 7, 2023. The Company recorded $10,000 of original issue discount to the Note. After payment of original issue discount, net proceeds to the Company from the Note totaled $100.000. In connection with the execution of the Note, the Company issued 300,000 shares of our common stock at the time of issuance. The Company recognized the relative fair market value $38,850 for shares of common stock to debt discount, which will be amortized to interest expense during the term of the Note. The Noteholder shall have the right, on any calendar day, at any time on or following the earlier of (i) July 7, 2023 or (ii) sixty (60) calendar days after listing on Nasdaq or the New York Stock Exchange to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of common stock at the Conversion Price of $0.10, subject to adjustment as provided in the Note. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (3)	110,000	110,000

On January 21, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $230,000, an annual interest rate of 8%, and a maturity date of October 21, 2022. After payment of transaction-related expenses and closing fees of $26,300, net proceeds to the Company from the Note totaled $203,700. Additionally, the Company recorded $26,300 as a discount to the Note and amortized over the term of the note. In connection with the execution of the Note, the Company issued 300,000 shares of our Common Stock to the note holder and recorded $30,446 as debt discount and amortized over the term of the Note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of Common Stock. The Note Conversion Price shall equal the greater of $0.15 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the Note. The outstanding Balance shall immediately increase to 125% of the Outstanding Balance immediately prior to the occurrence of the Event of Default and a daily penalty of $500 will accrue until the default is remedied. The maturity date has been extended multiple times. Most recently, on January 30, 2023, the lender agreed to extend the maturity until May 30, 2023. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $30,000 and issued 300,000 shares of Common Stock with a fair market value of $26,910, both of which, were charged to interest expense. The Company is currently working with the lender to extend the maturity date beyond May 30, 2023. There can be no assurance that we will be able to extend the maturity date. (1) (2) (3)	290,000	230,000
On July 27, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $165,000, an annual interest rate of 8%, and a maturity date of April 27, 2023. After payment of transaction-related expenses and closing fees of $19,500, net proceeds to the Company from the Note totaled $145,500. Additionally, the Company issued 300,000 shares of our Common Stock to the Noteholder. The Company recorded the $19,500 and the relative fair market value of the shares of $22,093 as debt discount and amortized to interest expense over the term of the Note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of Common Stock. The Note conversion price shall equal the greater of $0.10 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the Note. The maturity date has been extended multiple times. Most recently, on April 25, 2023, the lender agreed to extend the maturity until July 31, 2023. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $30,000 and issued 300,000 shares of Common Stock with a fair market value of $21,000, both of which, were charged to interest expense. (1) (2) (3)	195,000	119,500
On September 12, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $75,000, an annual interest rate of 8%, and a maturity date of September 12, 2023. In connection with the execution of the Note, the Company issued 150,000 shares of our Common Stock to the note holder, at the time of issuance, the Company recognized the relative fair market value of the shares of $15,880 as debt discount, and it will be amortized to interest expense during the term of the promissory Note. The Noteholder may elect to convert up to 100% of the principal amount outstanding and any accrued interest on the Note into Common Stock at any time after 180 days of funding the Note. The Conversion Price shall be the greater of $0.15 or 75% of the lowest daily volume weighted average price (“VWAP”) for the ten (10) trading day period immediately preceding the conversion date. The Noteholder may elect to convert up to 100% of the principal plus accrued interest into shares of Common Stock into a qualified uplist financing at a 25% discount. (1) (3)	75,000	-

On March 17, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $192,000, annual interest rate of 10% and a maturity date of March 17, 2024. The Company recorded $17,160 in transaction-related expenses and closing fees and $28,800 of original issue discount to the Note. After payment of transaction-related expenses and closing fees and original issue discount, net proceeds to the Company from the Note totaled $146,040. In connection with the execution of the note, the Company issued 241,500 shares of our common stock and 1,207,186 warrant shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value $8,140 for the common shares and $62,481 for the warrant shares, both of which, were considered to be debt discount. Additionally, the Company recognized $47,806 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Holder shall have the right, on any calendar day, at any time on or following the earlier of (i) July 17, 2023 or (ii) sixty (60) calendar days after the closing date of the Merger to convert all or any portion of the then outstanding and unpaid principal amount and interest (including any Default Interest) into fully paid and non-assessable shares of common stock, as such common stock exists on the Issue Date. The Note conversion price shall equal $0.0956, subject to adjustment as provided in the Note. (1) (3)		192,000		192,000

On April 14, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $275,000, an annual interest rate of 10%, and a maturity date of October 11, 2023. The Company recorded $25,000 in original issue discount to the Note. After payment of the original issue discount, net proceeds to the Company from the Note totaled $250,000. In connection with the execution of the Note, the Company issued 358,000 shares of our common stock shares to the note holder at the time of issuance. The Company recognized the relative fair market value of the common shares of $28,354 as debt discount. All debt discount will be amortized to interest expense during the term of the promissory note. The note holder may elect to convert up to 50% of the principal amount outstanding and any accrued interest on the Note into common stock at any time, on the date of the debtor’s up-list transaction on the NASDAQ. The Note conversion price shall equal $0.10 subject to adjustment as provided in the Note. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (1) (3)		275,000		275,000

On May 9, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $55,000, an annual interest rate of 8%, and a maturity date of February 9, 2024. The Company recorded $5,000 in original issue discount to the Note. After payment of the original issue discount, net proceeds to the Company from the Note totaled $50,000. In connection with the execution of the Note, the Company issued 300,000 shares of our common stock shares to the note holder at the time of issuance. The Company recognized the relative fair market value of the common shares of $16,390 as debt discount. The Company recognized $15,560 debt discount related to beneficial conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Noteholder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of our common stock at the conversion price below. The Note conversion price shall equal the greater of $0.10 (ten) cents or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American subject to adjustment as provided in the Note. (1) (3)		55,000		55,000

Total convertible notes payables non-derivative:	$	8,149,103	$	8,114,603

On October 3, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $165,000, an annual interest rate of 8%, and a maturity date of July 3, 2023. After payment of transaction-related expenses and closing fees of $19,500, net proceeds to the Company from the Note totaled $145,500. Additionally, the Company issued 300,000 shares of our Common Stock to the Noteholder. The Company recorded the $19,500 and the relative fair market value of the shares of $32,143 as debt discount and amortized to interest expense over the term of the Note. The Company recognized $117,857 debt discount related to beneficial conversion feature and will be amortized to interest expense over the term of Note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of Common Stock. The Note conversion price shall equal the greater of $0.10 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the Note. (1) (3)	165,000	-
On October 27, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $38,500, an annual interest rate of 8%, and a maturity date of July 26, 2023. After payment of transaction-related expenses and closing fees of $3,500, net proceeds to the Company from the Note totaled $25,000. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of Common Stock. The Note conversion price shall equal the greater of $0.10 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the Note. (1) (3)	38,500	-
On October 27, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $71,500, an annual interest rate of 8%, and a maturity date of July 26, 2023. After payment of transaction-related expenses and closing fees of $6,500, net proceeds to the Company from the Note totaled $65,000. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of Common Stock. The Note conversion price shall equal the greater of $0.10 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the Note. (1) (3)	71,500	-
On October 31, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $350,000, an annual interest rate of 14%, and a maturity date of February 28, 2023. Net proceeds to the Company from the Note totaled $350,000. In the event that any payment is not made when due, either of principal or interest, and whether upon maturity or as a result of acceleration, interest shall thereafter accrue at the rate per annum equal to the lesser of (a) the maximum non-usurious rate of interest permitted by the laws of the State of Texas or the United States of America, whichever shall permit the higher rate or (b) twenty percent (20%) per annum, from such date until the entire balance of principal and accrued interest on this Note has been paid. At any time after sixty (60) days following the date hereof, Payee may elect to convert a percentage of the amount of principal and accrued interest outstanding on the Note into common stock of Debtor, in accordance with the following terms: (i) If prior to uplist to Nasdaq or NYSE, Payee may convert up to 50% of the amount outstanding on the Note into Common Stock. In such event, the price per share of Common Stock applicable to such conversion (the “Applicable Conversion Price”) shall be the greater of: (a) the Variable Conversion Price or (b) the Fixed Conversion Price. The “Variable Conversion Price” shall be equal to a 20% discount to the average closing price for Common Stock for the five (5) Trading Day period immediately preceding the Conversion Date. The Fixed Conversion Price shall equal $0.10; and (ii) If following the Uplist, Payee may convert up to 100% of the amount outstanding on the Note into shares of Common Stock. In such event, the Applicable Conversion Price shall be the greater of: (a) the post-Uplist Variable Conversion Price (i.e., if less than 5 days after the Uplist, then the average of the days available since the Uplist up to 5) or (b) the Fixed Conversion Price. On March 30, 2023, the maturity date was extended to May 30, 2023. In connection with the extension, the Company issued 2,500,000 warrant shares to the Noteholder and recognized the relative fair market value of the warrant shares of $107,006 as debt discount. Additionally, the Company recognized $77,710 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Company is currently working with the lender to extend the maturity date beyond May 30, 2023. There can be no assurance that we will be able to extend the maturity date. (1) (3)	350,000	-

CONVERTIBLE NOTES PAYABLE - DERIVATIVE

On July 27, 2020, the Company entered into a variable convertible promissory note with an aggregate principal amount of $275,000, an annual interest rate of 8%, and a maturity date of March 27, 2021. On January 17, 2023, the Note was amended so that the Holder shall be entitled, at any time, to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of common stock the Note Conversion Price shall equal the greater of $0.05 (five) or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in this Note. If an Event of Default occurs, the Conversion Price shall be the lesser of (a) $0.05 or (b) 75% of the lowest traded price in the prior fifteen trading days immediately preceding the Notice of Conversion. The maturity date has been extended multiple times. On March 30, 2023, the lender agreed to extend the maturity date until June 30, 2023. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $30,000, which was charged to interest expense, and issued 250,000 shares of common stock with a market value of $19,225. The Company evaluated the amendment and accounted for these changes as an extinguishment of debt. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (2) (4)	390,000	390,000

On November 22, 2022, the Company entered into a convertible promissory note with an aggregate principal amount of $1,670,000, an annual interest rate of 10%, and a maturity date of November 22, 2023. The Company recorded $90,975 in transaction-related expenses and closing fees and $250,500 of original issue discount to the Note. After payment of transaction-related expenses and closing fees and original issue discount, net proceeds to the Company from the Note totaled $1,328,525 In connection with the execution of the Note, the Company issued 2,100,000 shares of our Common Stock and 10,500,000 warrant shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the shares of Common Stock and warrant shares of $640,877 as debt discount. Additionally, the Company recognized $687,648 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the Note. As amended on March 24, 2023, the Noteholder shall have the right, on or before the earlier of (i) the closing of the Merger (as defined in Note 12) or (ii) May 31, 2023, to convert all or any portion of the Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of Common Stock. The Note conversion price shall equal $0.0956 subject to adjustment as provided in the note. On April 24, 2023, the Noteholder agreed to extend the due date for the first principal payment to May 22, 2023. In connection with the extension of the due date of the first principal payment on the Note, the Company agreed to increase the principal balance by $20,000. (1) (3)	1,670,000	-
On January 31, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $80,235, annual interest rate of 8% and a maturity date of February 17, 2022. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Holder shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of common stock the Note Conversion Price shall equal the greater of $0.05 (five) or seventy-five percent (75%) of the lowest daily volume weighted average price (“VWAP”) over the ten (10) consecutive trading day period ending on the trading day immediately prior to the applicable conversion date (the “Variable Conversion Price”); provided, however, that the Holder shall, in its sole discretion, be able to convert any amounts due hereunder at a twenty-five percent (25%) discount to the per share price of the Qualified Uplisting Financing of over $4MM. If, no later than December 31, 2021, the Borrower shall fail to uplist to any tier of the NASDAQ Stock Market, the New York Stock Exchange or the NYSE MKT, the conversion price under the Note (and the Exchange Note) will be adjusted to equal the lesser of (i) $0.05 per share; or (ii) seventy-five percent (75%) of the lowest VWAP (as defined in the Note and Exchange Note) in the preceding twenty (20) consecutive Trading Days. As a result, the Company recognized derivative liability for the convertible note of $59,413. During the last fiscal year, the holder agreed to extend the maturity date until July 31, 2023. Subsequent to October 31, 2023, the maturity date of the Note was extended to December 31, 2023. (2) (4)	149,872	149,872
On December 12, 2022, the Company entered into a convertible promissory note with an aggregate principal amount of $117,647, annual interest rate of 10% and a maturity date of December 12, 2023. The Company recorded $17,647 as original issue discount to the Note, which resulted in net proceeds of $100,000, and amortized to interest expense over the term of the note. In connection with the execution of the note, the Company issued 148,295 shares of our Common Stock and 741,475 warrant shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the Common Stock and warrant shares of $41,685 as debt discount, and it will be amortized to interest expense during the term of the Note. Additionally, the Company recognized $58,315 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the Note. The Noteholder shall have the right, on any calendar day, at any time on or following the earlier of (i) April 12, 2023 or (ii) sixty (60) calendar days after the closing date of the Merger (as defined in Note 12), to convert all or any portion of the Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of Common Stock. The Note conversion price shall equal $0.0956, subject to adjustment as provided in the Note. On May 24, 2023, the lender agreed to extend the due date for the first principal payment to June 12, 2023, which was originally due on March 12, 2023, and later extended to May 12, 2023. (1) (3)	117,647	-
On April 15, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $113,000, an annual interest rate of 8%, and a maturity date of January 15, 2022. After payment of transaction-related expenses and closing fees of $13,000, net proceeds to the Company from the Note totaled $100,000. Additionally, the Company recorded $13,000 as a discount to the Note and amortized over the term of the note. In connection with the execution of the Note, the Company issued 100,000 shares of our common stock to the note holder, at the time of issuance, the Company recognized the relative fair market value of the shares of $14,138 as debt discount, and it will be amortized to interest expense during the term of the promissory note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Holder shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of common stock. The Note Conversion Price shall equal the greater of $0.15 (fifteen) or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American., subject to adjustment as provided in the Note. If an Event of Default occurs, the Conversion Price shall be the lesser of (a). $0.15 or (b). seventy-five percent of the lowest traded price in the prior fifteen (15) consecutive trading day period ending on the trading day immediately prior to the applicable conversion date (the “Variable Conversion Price”). Outstanding Balance shall immediately increase to 125% of the Outstanding Balance immediately prior to the occurrence of the Event of Default and a daily penalty of $500 will accrue until the default is remedied. The Company recognized derivative liability for the convertible note of $64,561, of which $42,822 was recorded as debt discount and amortized over the term of the Note. The maturity date has been extended multiple times since inception. On March 30, 2023, the lender agreed to extend the maturity until June 30, 2023. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $25,000, which was charged to interest expense, and issued 150,000 shares of common stock with a market value of $11,995. Subsequent to October 31, 2023, the maturity date on the Note was extended to December 31, 2023. (2) (4)	233,000	233,000
On December 20, 2022, the Company entered into a convertible promissory note with an aggregate principal amount of $176,471, an annual interest rate of 10%, and a maturity date of December 20, 2023. The Company recorded $5,000 in deferred finance costs and $26,471 of original issue discount to the Note. After payment of transaction-related expenses, net proceeds to the Company from the Note totaled $145,500. In connection with the execution of the Note, the Company issued 221,909 shares of our Common Stock and 1,109,545 warrant shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the Common Stock and warrant shares of $59,374 as debt discount. Additionally, the Company recognized $79,014 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the Note. The Noteholder shall have the right, on any calendar day, at any time on or following the earlier of (i) April 12, 2023 or (ii) sixty (60) calendar days after the closing date of the Merger (as defined in Note 12), to convert all or any portion of the Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of Common Stock. The Note conversion price shall equal $0.0956, subject to adjustment as provided in the Note. On March 17, 2023, the Noteholder agreed to extend the maturity date until May 20, 2023 or the closing of the Merger. (1) (3)	176,471	-

2528

On December 22, 2022, the Company entered into a convertible promissory note with an aggregate principal amount of $188,235, annual interest rate of 10% and a maturity date of December 22, 2023. The Company recorded $10,000 in transaction-related expenses and closing fees and $28,235 of original issue discount to the Note. After payment of transaction-related expenses and closing fees and original issue discount, net proceeds to the Company from the Note totaled $150,000. In connection with the execution of the note, the Company issued 236,703 shares of our Common Stock and 1,183,515 warrant shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the Common Stock and warrant shares of $66,679 as debt discount. Additionally, the Company recognized $83,321 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Noteholder shall have the right, on any calendar day, at any time on or following the earlier of (i) April 22, 2023 or (ii) sixty (60) calendar days after the closing date of the Merger (as defined in Note 12), to convert all or any portion of the Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of Common Stock. The Note conversion price shall equal $0.0956, subject to adjustment as provided in the Note. On March 17, 2023, the Noteholder agreed to extend the maturity date until May 22, 2023 or the closing of the Merger. (1) (3)		188,235			-
On October 10, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $275,000, annual interest rate of 8% and a maturity date of April 10, 2023. After payment of transaction-related expenses and closing fees of $25,000, net proceeds to the Company from the note totaled $250,000. The Company recorded the $25,000 as debt discount and amortized to interest expense over the term of the note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the note holder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of common stock. The note conversion price shall equal the greater of $0.15 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the note. If the Company fails to uplist, the conversion price under the Note will be adjusted to equal the lesser of (i) $0.10 per share; or (ii) seventy-five percent (75%) of the lowest VWAP in the preceding twenty (20) consecutive Trading Days. Any Principal Amount or interest on this Note which is not paid when due shall bear interest at the rate the lesser of (a) twenty-four percent (24%) per annum from the due date thereof until the same is paid (“Default Interest”); or (b) the maximum rate allowed by law. During the last fiscal year, the holder agreed to extend the maturity date until July 31, 2023. As compensation for the extension of the maturity date, $13,750 was added to the principal balance of the Note Subsequent to October 31, 2023, the maturity date of the Note was extended to December 31, 2023. (2) (4)		288,750			288,750
On January 13, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $110,000, an annual interest rate of 10%, and a maturity date of October 13, 2023. The Company recorded $10,000 in original issue discount to the Note. After payment of the original issue discount, net proceeds to the Company from the Note totaled $100,000. In connection with the execution of the Note, the Company issued 138,000 shares of our Common Stock shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the shares of Common Stock of $11,177 as debt discount. Additionally, the Company recognized $21,507 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the Note. The Noteholder shall have the right, on any calendar day, at any time on or following the earlier of (i) May 12, 2023 or (ii) sixty (60) calendar days after listing on Nasdaq or the New York Stock Exchange to convert any portion of the outstanding and unpaid Conversion into fully paid and nonassessable shares of Common Stock, at the Conversion Price. The Note conversion price shall equal $0.10, subject to adjustment as provided in the Note. (1) (3)		110,000			-
Total convertible notes payable - derivative:	$	1,061,622		$	1,061,622
On January 24, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $660,000, an annual interest rate of 10%, and a maturity date of May 24, 2023. The Company recorded $60,000 in original issue discount to the Note. After payment of the original issue discount, net proceeds to the Company from the Note totaled $600,000. In connection with the execution of the Note, the Company issued 660,000 shares of our Common Stock shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the shares of Common stock of $53,850 as debt discount. Additionally, the Company recognized $104,610 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Payee may elect to convert up to 100% of the Principal Amount outstanding on the Note into Common Stock of Debtor or any shares of capital stock or other securities of the Debtor into which such Common Stock shall hereafter be changed or reclassified at any time on the earlier of (i) one hundred and twenty (120) calendar days following the funding of this Note or (ii) sixty (60) calendar days after the closing date of the Merger (as defined in Note 12). The Note conversion price shall equal $0.10, subject to adjustment as provided in the Note. On June 1, 2023, the Company amended its agreement with the Noteholder, which extends the maturity date from May 24, 2023, to the earlier of June 30, 2023 or the closing of the Business Combination with MEOA in exchange for 165,000 shares of Common Stock. (1) (3)		660,000			-
Total convertible notes payable derivative and non-derivative		9,210,725			9,176,225
Less: debt discount		(293,135	)		(959,922	)
Total convertible notes payable, net of discount		8,917,590			8,216,303
Less: current portion of convertible notes payable		(8,917,590	)		(8,216,303	)
Long-term portion of convertible notes payable	$	-		$	-

26Additional terms No.1: The Holder of the Note originally dated October 13, 2020 with a balance of $173,250 as of October 31, 2023, shall have the right to convert any portion of the outstanding and unpaid principal balance into fully paid and nonassessable shares of common stock. The conversion price (the “Conversion Price”) shall equal $0.05 (subject to equitable adjustments for stock splits, stock dividends or rights offerings by the Borrower relating to the Borrower’s securities or the securities of any subsidiary of the Borrower, combinations, recapitalization, reclassifications, extraordinary distributions, and similar events).

On January 24, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $660,000, an annual interest rate of 10%, and a maturity date of May 24, 2023. The Company recorded $60,000 in original issue discount to the Note. After payment of the original issue discount, net proceeds to the Company from the Note totaled $600,000. In connection with the execution of the Note, the Company issued 660,000 shares of our Common Stock shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the shares of Common stock of $53,850 as debt discount. Additionally, the Company recognized $104,610 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Payee may elect to convert up to 100% of the Principal Amount outstanding on the Note into Common Stock of Debtor or any shares of capital stock or other securities of the Debtor into which such Common Stock shall hereafter be changed or reclassified at any time on the earlier of (i) one hundred and twenty (120) calendar days following the funding of this Note or (ii) sixty (60) calendar days after the closing date of the Merger (as defined in Note 12). The Note conversion price shall equal $0.10, subject to adjustment as provided in the Note. On June 1, 2023, the Company amended its agreement with the Noteholder, which extends the maturity date from May 24, 2023 to the earlier of June 30, 2023 or the closing of the Business Combination with MEOA in exchange for 165,000 shares of Common Stock. (1) (3)		660,000		-
On March 7, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $110,000, annual interest rate of 10% and a maturity date of December 7, 2024. The Company recorded $10,000 of original issue discount to the Note. After payment of original issue discount, net proceeds to the Company from the Note totaled $100.000. In connection with the execution of the Note, the Company issued 300,000 shares of our Common Stock at the time of issuance. The Company recognized the relative fair market value $38,850 for shares of Common Stock to debt discount, which will be amortized to interest expense during the term of the Note. The Noteholder shall have the right, on any calendar day, at any time on or following the earlier of (i) July 7, 2023 or (ii) sixty (60) calendar days after listing on Nasdaq or the New York Stock Exchange to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of Common Stock at the Conversion Price of $0.10, subject to adjustment as provided in the Note. (1) (3)		110,000		-
On March 17, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $192,000, annual interest rate of 10% and a maturity date of March 17, 2024. The Company recorded $17,160 in transaction-related expenses and closing fees and $28,800 of original issue discount to the Note. After payment of transaction-related expenses and closing fees and original issue discount, net proceeds to the Company from the Note totaled $146,040. In connection with the execution of the note, the Company issued 241,500 shares of our Common Stock and 1,207,186 warrant shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value $8,140 for the common shares and $62,481 for the warrant shares, both of which, were considered to be debt discount. Additionally, the Company recognized $47,806 as debt discount for the intrinsic value of the conversion feature. All debt discount will be amortized to interest expense during the term of the promissory note. The Holder shall have the right, on any calendar day, at any time on or following the earlier of (i) July 17, 2023 or (ii) sixty (60) calendar days after the closing date of Merger (as defined in Note 12), to convert all or any portion of the then outstanding and unpaid Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of Common Stock, as such Common Stock exists on the Issue Date. The Note conversion price shall equal $0.0956, subject to adjustment as provided in the Note. (1) (3)		192,000		-
On April 14, 2023, the Company entered into a convertible promissory note with an aggregate principal amount of $275,000, an annual interest rate of 10%, and a maturity date of October 11, 2023. The Company recorded $25,000 in original issue discount to the Note. After payment of the original issue discount, net proceeds to the Company from the Note totaled $250,000. In connection with the execution of the Note, the Company issued 358,000 shares of our Common Stock shares to the Noteholder at the time of issuance. The Company recognized the relative fair market value of the common shares of $28,354 as debt discount. All debt discount will be amortized to interest expense during the term of the promissory note. The Noteholder may elect to convert up to 50% of the principal amount outstanding and any accrued interest on the Note into Common Stock, on the date of the debtor’s up-list transaction on the NASDAQ. The Note conversion price shall equal $0.10 subject to adjustment as provided in the Note. (1) (3)		275,000		-
Total convertible notes payables non-derivative:	$	8,240,603	$	3,844,500

The total unamortized discount on the convertible notes as of October 31, 2023 and July 31, 2023 was $293,135 and $959,922, respectively. The total principal balance outstanding as of October 31, 2023 and July 31, 2023 was $9,210,725 and $9,176,225 respectively. During the three months October 31, 2023 and 2022, the Company amortized $666,787 and $207,564, respectively, of debt discount as interest expense.

27(1) The Company determines at each reporting period if any default provisions and other requirements triggered a variable conversion price and if the note needs to be classified as a derivative instrument.

CONVERTIBLE NOTES PAYABLE - DERIVATIVE
On July 27, 2020, the Company entered into a variable convertible promissory note with an aggregate principal amount of $275,000, an annual interest rate of 8%, and a maturity date of March 27, 2021. After payment of transaction-related expenses and closing fees of $35,000, net proceeds to the Company from the Note totaled $240,000. The Company recorded these discounts and cost of $35,000 as a discount to the Note and amortized over the term of the Note. In connection with the execution of the note, the Company issued 500,000 shares of our Common Stock to the note holder, at the time of issuance, the Company recognized the relative fair market value of the shares of $11,626 as debt discount, and it will be amortized to interest expense during the term of the promissory note. On January 17, 2023, the Note was amended so that the Noteholder shall be entitled, at any time, to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of Common Stock the Note Conversion Price shall equal the greater of $0.05 (five) or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in this Note. If an Event of Default occurs, the Conversion Price shall be the lesser of (a) $0.05 or (b) 75% of the lowest traded price in the prior fifteen trading days immediately preceding the Notice of Conversion. The Company recognized $61,678 of derivative liability and directly amortized all associated debt discount of $61,678 as interest expense. The maturity date has been extended multiple times. Most recently, on March 30, 2023, the lender agreed to extend the maturity date until June 30, 2023. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $30,000, which was charged to interest expense, and issued 250,000 shares of Common Stock with a market value of $19,225. The Company evaluated the amendment and accounted for these changes as an extinguishment of debt. (2) (4)	390,000	480,000
On January 31, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $80,235, annual interest rate of 8% and a maturity date of February 17, 2022. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of Common Stock the Note Conversion Price shall equal the greater of $0.05 (five) or seventy-five percent (75%) of the lowest daily volume weighted average price (“VWAP”) over the ten (10) consecutive trading day period ending on the trading day immediately prior to the applicable conversion date (the “Variable Conversion Price”); provided, however, that the Holder shall, in its sole discretion, be able to convert any amounts due hereunder at a twenty-five percent (25%) discount to the per share price of the Qualified Uplisting Financing of over $4MM. If, no later than December 31, 2021, the Borrower shall fail to uplist to any tier of the NASDAQ Stock Market, the New York Stock Exchange or the NYSE MKT, the conversion price under the Note (and the Exchange Note) will be adjusted to equal the lesser of (i) $0.05 per share; or (ii) seventy-five percent (75%) of the lowest VWAP (as defined in the Note and Exchange Note) in the preceding twenty (20) consecutive Trading Days. As a result, the Company recognized derivative liability for the convertible note of $59,413. During the most recent quarter, the holder agreed to extend the maturity date until July 31, 2023. (2) (4)	142,735	80,235
On April 15, 2021, the Company entered into a variable convertible promissory note with an aggregate principal amount of $113,000, an annual interest rate of 8%, and a maturity date of January 15, 2022. After payment of transaction-related expenses and closing fees of $13,000, net proceeds to the Company from the Note totaled $100,000. Additionally, the Company recorded $13,000 as a discount to the Note and amortized over the term of the note. In connection with the execution of the Note, the Company issued 100,000 shares of our Common Stock to the note holder, at the time of issuance, the Company recognized the relative fair market value of the shares of $14,138 as debt discount, and it will be amortized to interest expense during the term of the promissory note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of Common Stock. The Note Conversion Price shall equal the greater of $0.15 (fifteen) or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American., subject to adjustment as provided in the Note. If an Event of Default occurs, the Conversion Price shall be the lesser of (a). $0.15 or (b). seventy-five percent of the lowest traded price in the prior fifteen (15) consecutive trading day period ending on the trading day immediately prior to the applicable conversion date (the “Variable Conversion Price”). The outstanding Balance shall immediately increase to 125% of the Outstanding Balance immediately prior to the occurrence of the Event of Default and a daily penalty of $500 will accrue until the default is remedied. The Company recognized derivative liability for the convertible note of $64,561, of which $42,822 was recorded as debt discount and amortized over the term of the Note. The maturity date has been extended multiple times. Most recently, the lender agreed to extend the maturity until June 30, 2023. In connection with the extension of the maturity date on the Note, the Company agreed to increase the principal balance by $25,000, which was charged to interest expense, and issued 150,000 shares of Common Stock with a market value of $11,995. (2) (4)	233,000	163,000

(2)	The Company evaluated the amendment(s) and accounted for these changes as an extinguishment of debt.

28(3) The Company analyzed the Note and determined that it does not require to be accounted as a derivative instrument.

On October 10, 2022, the Company entered into a variable convertible promissory note with an aggregate principal amount of $275,000, annual interest rate of 8% and a maturity date of April 10, 2023. After payment of transaction-related expenses and closing fees of $25,000, net proceeds to the Company from the note totaled $250,000. The Company recorded the $25,000 as debt discount and amortized to interest expense over the term of the Note. Until the earlier of 6 months or the Company listing on Nasdaq or NYSE American, the Noteholder shall be entitled to convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of Common Stock. The note conversion price shall equal the greater of $0.15 or 25% discount to up-listing price or offering/underwriting price concurrent with the Company listing on Nasdaq or NYSE American, subject to adjustment as provided in the note. Any Principal Amount or interest on this Note which is not paid when due shall bear interest at the rate the lesser of (a) twenty-four percent (24%) per annum from the due date thereof until the same is paid (“Default Interest”); or (b) the maximum rate allowed by law. During the most recent quarter, the holder agreed to extend the maturity date until July 31, 2023. (4)		275,000			-
Total convertible notes payable - derivative:	$	1,040,735		$	723,235
Total convertible notes payable derivative and non-derivative		9,281,338			4,567,735
Less: debt discount		(1,850,931	)		(119,764	)
Total convertible notes payable, net of discount		7,430,407			4,447,971
Less: current portion of convertible notes payable		(7,430,407	)		(3,947,971	)
Long-term portion of convertible notes payable	$	-		$	500,000

(4)	The Company analyzed the note for derivative accounting consideration and determined that the embedded conversion option qualified as a derivative instrument, due to the variable conversion price.

~~Additional terms No.1 :~~ The ~~Holder~~future ~~of the Note originally dated October 13, 2020 with a balance of $165,000 as of April 30, 2023, shall have the right to convert any portion of the outstanding and unpaid~~ principal ~~balance~~payments ~~into fully paid and nonassessable shares of Common Stock. The conversion price (the “Conversion Price”) shall equal $0.05 (subject to equitable adjustments~~ for ~~stock splits, stock dividends or rights offerings by the Borrower~~ ~~relating to~~ the ~~Borrower~~Company’s ~~securities~~convertible ordebt ~~the~~are ~~securities~~as ~~of any subsidiary of the Borrower, combinations, recapitalization, reclassifications, extraordinary distributions, and similar events).~~follows:

~~The~~Future ~~total~~Principal ~~unamortized~~Payments discount on the convertible notes as of April 30, 2023 and July 31, 2022 was $1,850,931 and $119,764, respectively. The total principal balance outstanding as of April 30, 2023 and July 31, 2022 was $9,281,338 and $4,567,735 respectively. During the nine months ended April 30, 2023 and 2022, the Company amortized $1,749,307 and $311,148, respectively, of debt discount as interest expense.

(1) The Company determines at each reporting period if any default provisions and other requirements triggered a variable conversion price and if the note needs to be classified as a derivative instrument.

Year ended July 31,	Amount
2024	$	8,917,590
2025		-
Total future payments:	$	8,917,590

~~(2) The Company evaluated the amendment(s) and accounted for these changes as an extinguishment of debt.~~29

~~(3)~~NOTE ~~The~~9 ~~Company~~– ~~analyzed the Note and determined that it does not require to be accounted as a derivative instrument.~~LEASES

~~(4)~~ The ~~Company~~leased ~~analyzed~~properties ~~the~~have ~~note~~a ~~for~~remaining ~~derivative~~lease ~~accounting~~term of ~~consideration~~five ~~and~~to ~~determined~~sixty ~~that~~months ~~the~~as ~~embedded~~of ~~conversion~~October ~~option~~31, ~~qualified~~2023. asAt athe ~~derivative~~option ~~instrument~~of the Company, ~~due~~it can elect to extend the ~~variable~~term ~~conversion~~of ~~price~~the leases. See table below:

Location	Annual Rent		Lease Expiration Date	Business Use	Approx. Sq. Ft.
8023 Vantage Dr., Suite 660, San Antonio, Texas 78230	$	49,136	Sep-27	Executive offices		2,843
10967 Via Frontera, San Diego, CA 92127	$	369,229	Mar-26	Office space		18,541
1610 Royal Palm Avenue, Suite 300, Fort Myers, FL 33901	$	83,260	Dec-25	Office space and network facilities		6,800
2121 Ponce de Leon Blvd., Suite 200, Coral Gables FL 33134	$	106,553	Dec-27	Office space & wireless internet network		4,623
7218 McNeil Dr., FL-1, Austin, TX 78729	$	21,000	Mar-24	Network facilities		25
9701 S. John Young Parkway, Orlando, FL 32819	$	25,440	May-26	Network facilities		540
8333 NW 53rd St, Doral, FL 33166	$	14,021	Jul-25	Wireless internet network		100
100 SE 2nd Street, Miami, FL 33131	$	36,466	Jan-24	Wireless internet network		100
9055 SW 73rd Ct, Miami, FL 33156	$	8,787	Dec-23	Wireless internet network		100
9517 Fontainebleau Blvd., Miami, FL 33172	$	11,907	Aug-24	Wireless internet network		100

~~NOTE~~The Company has not entered into any sale and 9leaseback –transactions ~~LEASES~~ during the quarter ended October 31, 2023.

On May 17, 2022, the Company extended the office and wireless internet network leases in Coral Gables, Florida. The ~~leased~~Company ~~properties~~accounted ~~have~~for athe ~~remaining~~extension as a lease ~~term~~modification. The Company used the discount rate of ~~three~~4% toand ~~sixty~~recognized ~~months~~$482,865 as a day one Right-of-Use ~~April~~asset ~~30,~~and ~~2023~~liability. AtThese leases are identified in the table above. The leases expire in December 2027, and at the option of the Company, itthe leases can ~~elect~~be extended for various periods ranging from one to ~~extend~~five years, with a base rent at the ~~term~~prevailing ofmarket rate at the ~~leases.~~time ~~See~~of ~~table below:~~the renewal.

Location	Annual Rent		Lease Expiration Date	Business Use	Approx. Sq. Ft.
8023 Vantage Dr., Suite 660, San Antonio, Texas 78230	$	49,136	Sep-27	Executive offices		2,843
10967 Via Frontera, San Diego, CA 92127	$	369,229	Mar-26	Office space		18,541
1610 Royal Palm Avenue, Suite 300, Fort Myers, FL 33901	$	83,260	Dec-25	Office space and network facilities		6,800
2121 Ponce de Leon Blvd., Suite 200, Coral Gables FL 33134	$	106,553	Dec-27	Office space & wireless internet network		4,623
7218 McNeil Dr., FL-1, Austin, TX 78729	$	21,000	Mar-24	Network facilities		25
9701 S. John Young Parkway, Orlando, FL 32819	$	25,440	May-23	Network facilities		540
50 NE 9th St, Miami, FL 3313	$	41,300	May-23	Network facilities		25
350 NW 215 St., Miami Gardens, FL 33169	$	29,254	May-23	Wireless internet network		100
8333 NW 53rd St, Doral, FL 33166	$	14,021	Jul-25	Wireless internet network		100
100 SE 2nd Street, Miami, FL 33131	$	36,466	Jan-24	Wireless internet network		100
9055 SW 73rd Ct, Miami, FL 33156	$	8,787	Dec-23	Wireless internet network		100
9517 Fontainebleau Blvd., Miami, FL 33172	$	11,907	Aug-24	Wireless internet network		100

In February 2022, as part of the acquisition of NLI, the Company secured an office lease, with a monthly base lease payment of $30,222. The lease expires in March 2026. At the option of the Company, the lease can be extended for two additional five-year terms, with a base rent at the prevailing market rate at the time of the renewal. The Company is not reasonably certain that it will exercise the renewal option.

~~The~~In December 2021, as part of the acquisition of Skynet’s assets, the Company ~~has~~assumed ~~not~~an ~~entered~~office ~~into~~lease ~~any~~in ~~sale~~San ~~and~~Antonio, Texas. In May 2022, the lease was extended until September ~~leaseback~~2027, ~~transactions~~and ~~during~~at the ~~nine~~option ~~months~~of ~~ended~~the ~~April~~Company, 30the lease can be extended for a period of five years, ~~2023~~with a base rent at the prevailing market rate at the time of the renewal. The Company accounted for the extension as a lease modification.

OnAmounts ~~May~~recognized ~~17, 2022, the Company extended the office and wireless internet network leases in Coral Gables, Florida. The Company accounted for the extension~~ as ~~a lease modification. The Company used the discount rate~~ of 5%July ~~and recognized $482~~31,~~865~~ as2023 ~~a day one ROU asset~~ and ~~liability. These leases are identified in the table above.~~October ~~The leases expire in December 2027~~31, ~~and~~2023 atfor ~~the~~operating ~~option of the Company, the~~ leases ~~can~~are beas ~~extended for various periods ranging from one to five years, with a base rent at the prevailing market rate at the time of the renewal.~~follows:

ROU Asset	July 31, 2023	$	1,911,639
Amortization		$	(182,139	)
Addition - Asset		$	-
ROU Asset	October 31, 2023	$	1,729,500

Lease Liability	July 31, 2023	$	1,981,976
Amortization		$	(182,139	)
Addition - Liability		$	-
Lease Liability	October 31, 2023	$	1,799,837

Lease Liability	Short term	$	629,424
Lease Liability	Long term	$	1,170,413
Lease Liability	Total:	$	1,799,837

Operating lease cost:		$	212,349

Cash paid for amounts included in the measurement of lease labilities:

Operating cashflow from operating leases:		$	212,349

Weighted-average remain lease term-operating lease:			2.9 years

Weighted-average discount rate			5.0	%

In December 2021, as part of the acquisition of Skynet Telecom LLC’s assets, the Company assumed an office lease in San Antonio, Texas. In May 2022, the lease was extended until September 2027, and at the option of the Company, the lease can be extended for a period of five years, with a base rent at the prevailing market rate at the time of the renewal. The Company accounted for the extension as a lease modification.30

~~Amounts~~The ~~recognized~~future asminimum oflease ~~July~~payment ~~31,~~under ~~2022~~the ~~and April 30, 2023 for~~ operating leases are as follows:

ROU Asset	July 31, 2022		$	2,436,035
	Lease
Amortization			$	(549,702	)
Period Ending July 31,	Payments
Addition - Asset			$	-
2024	$	594,880
ROU Asset	April 30, 2023		$	1,886,333
2025		729,724
Lease Liability	July 31, 2022		$	2,584,865
2026		431,377
Payments			$	(573,450	)
2027		176,771
Addition - Liability			$	-
2028		60,116
Lease Liability	April 30, 2023		$	2,011,415
Total:	$	1,992,868
Lease Liability	Short term		$	608,774
Less: amounts representing interest		193,031
Lease Liability	Long term		$	1,402,641
Present value of net minimum operating lease payments	$	1,799,837
Lease Liability	Total:		$	2,011,415
Operating lease cost:			$	599,955
Cash paid for amounts included in the measurement of lease labilities:
Operating cashflow from operating leases:			$	599,955
Weighted-average remain lease term-operating lease:				3.5 years
Weighted-average discount rate				5.0	%

30NOTE 10 – EQUIPMENT FINANCING

The Company entered into various financing agreements ~~future~~for ~~minimum~~equipment ~~lease~~purchased. ~~payment~~Under the term of the agreements, assets with a cost of approximately $558,463, were financed under various financing agreements during the ~~operating~~three ~~leases~~months ~~are~~ended October 31, 2023. The equipment financing is net of costs associated with the assets such as maintenance, ~~follows:~~insurance and property taxes are for the account of the Company. The equipment financing agreements are between twelve (12) months and sixty (60) months, with the first payments starting July 1, 2022, and monthly principal and interest payments of up to $3,600. The interest rate under the financing agreement is 5.0% per annum.

	Lease
Period Ending July 31,	Payments
2023 (three months remaining)		180,680
2024		650,734
2025		603,439
2026		431,377
2027		176,771
Total:	$	2,043,001

Amounts recognized as of July 31, 2023 and October 31, 2023 for equipment financing are as follows:

Less: amounts representing interest		31,586
ROU Asset	July 31, 2023		$	577,566
Present value of net minimum operating lease payments	$	2,011,415
Amortization			$	(36,016	)
Addition - Asset			$	558,463
ROU Asset	October 31, 2023		$	1,100,013
Equipment Financing	July 31, 2023		$	581,505
Amortization			$	(164,312	)
Addition - Equipment Financing			$	558,463
Equipment Financing	October 31, 2023		$	975,656
Equipment Financing	Short term		$	244,506
Equipment Financing	Long term		$	731,150
Equipment Financing	Total:		$	975,656

~~NOTE 10 – EQUIPMENT FINANCING~~31

The ~~Company~~ ~~entered~~future ~~into~~payments ~~various financing agreements for equipment purchased. Under the term of the agreements, assets with a cost of approximately $586,408, were financed~~ under ~~various financing agreements during~~ the ~~nine months ended April 30, 2023. The~~ equipment financing ~~is net of costs associated with the assets such as maintenance, insurance~~ ~~and property taxes are for the account of the Company. The equipment financing~~ agreements are ~~between~~as twelve (12) months and sixty (60) months, with the first payments starting July 1, 2022, and monthly principal and interest payments of up to $3,600. The interest rate under the financing agreement is 5.0% per annum.follows:

Amounts recognized as of July 31, 2022 and April 30, 2023 for equipment financing are as follows:

Year	Amount
2024	$	314,597
2025		380,832
2026		328,462
2027		12,637
2028		1,141
Total future payments:	$	1,037,669

Less: amounts representing interest		62,013

Present value of net minimum equipment financing payments	$	975,656
Lease cost:
Amortization of ROU assets	$	36,016
Interest on lease liabilities		35,577

Cash paid for amounts included in the measurement of lease liabilities:
Operating cashflow from equipment financing:	$	35,577
Financing cashflow from equipment financing:		164,312

Weighted-average remaining lease term - equipment financing:		2.4 years

Weighted-average discount rate		5.0	%

ROU Asset	July 31, 2022	$	62,263
Amortization		$	(73,673	)
Addition - Asset		$	524,145
ROU Asset	April 30, 2023	$	512,735
Equipment Financing	July 31, 2022	$	62,263
Payments		$	(77,972	)
Addition - Equipment Financing		$	530,928
Equipment Financing	April 30, 2023	$	515,219
Equipment Financing	Short term	$	195,740
Equipment Financing	Long term	$	319,479
Equipment Financing	Total:	$	515,219

NOTE 11 – EQUITY

~~The~~During ~~future~~the ~~payments~~three ~~under~~months ended October 31, 2023, the ~~equipment~~Company ~~financing~~issued 990,000 shares of common stock as consideration for the extension of maturity dates for the convertible promissory ~~agreements~~notes. ~~are~~The Company recognized the fair market value of the common shares of approximately $42,000 as ~~follows:~~interest at the time of each extension.

Year	Amount
2023 (three months remaining)	$	59,842
2024		203,789
2025		193,663
2026		84,334
2027		4,600
2028		1,533
Total future payments:	$	547,761

NOTE 12 – SUBSEQUENT EVENTS

31Amendment to Credit Agreement

Less: amounts representing interest		32,542
Present value of net minimum equipment financing payments	$	515,219
Lease cost:
Amortization of ROU assets	$	73,673
Interest on lease liabilities		18,306
Cash paid for amounts included in the measurement of lease liabilities:
Operating cashflow from equipment financing:	$	18,306
Financing cashflow from equipment financing:		73,673
Weighted-average remaining lease term - equipment financing:		2.9 years
Weighted-average discount rate		5.0	%

On November 22, 2023 (with effect from November 2, 2023), the Verve Cloud Nevada Parties, Digerati and Post Road entered into a Second Forbearance Agreement, Amendment to Loan Documents and Limited Consent, which (a) extends the maturity date of our Term Loan C Note with Post Road from November 2, 2023, to December 31, 2023, (b) provides that Post Road and the other lenders under the Credit Agreement shall forbear through December 31, 2023 from exercising their rights and remedies under the loan documents and applicable law with respect to (i) certain existing events of default under the loan documents and (ii) certain events of default that are expected to arise before December 31, 2023, and (c) amends certain provisions of the Credit Agreement and the other loan documents to allow the company to incur up to an additional $2,000,000 of working capital financing.

~~NOTE~~Promissory 11Note ~~– EQUITY~~Extensions

~~During the~~Subsequent ~~nine~~to ~~months~~October ~~ended April 30~~31, 2023, the Company ~~issued~~amended its 5past due promissory notes with 3BRT Investments,~~714~~ LP,~~407~~ ~~shares~~Skynet ofTelecom, ~~common~~LLC, ~~stock~~Tysadco inPartners, ~~connection~~LLC, ~~with~~Clearthink ~~new~~Capital ~~convertible~~Partners, LLC, ~~promissory~~Jerry ~~notes.~~and AtLisa ~~the~~Morris ~~time~~Revocable ofTrust ~~issuance~~Dated November 18, ~~the~~2002, ~~Company~~Jeffrey ~~recognized~~Posner, ~~the~~Jefferson ~~relative~~Street ~~fair~~Capital, ~~market~~LLC, ~~value~~MGR ofLimited ~~the~~Partnership, LGH ~~commons~~Investments, ~~shares~~LLC, ofLucas Ventures, LLC, Blue Ocean Investments, LLC, Graham A. Gardner, FirstFire Global Opportunities Fund, LLC, Platinum ~~approximately~~Point ~~$430~~Capital,~~000~~ asLLC, ~~debt~~Mast ~~discount~~Hill Fund, LP, and itPost ~~will~~Road beGroup ~~amortized~~(collectively, tothe ~~interest~~Lenders) ~~expense~~to ~~during~~extend the ~~term~~maturity ofdates to December 31, 2023 (the ~~promissory~~“forbearance termination date”). The Lenders agreed to forbear from exercising any rights and remedies they may have under the conditions of their respective notes until the forbearance termination date.

~~During~~Conversion ~~the nine months ended April 30, 2023, the Company issued 5,240,000 shares~~ of ~~common~~Amounts ~~stock~~Owed asto ~~consideration~~Vendor ~~for the extension of maturity dates for the convertible promissory notes.~~into ~~The Company recognized the fair market value of the common shares of approximately $505,000 which was recognized as interest at the time of each extension.~~Equity

~~During~~On ~~the~~November ~~nine months ended April 30~~9, 2023, ~~the Company~~one ~~issued~~of ~~170,305~~our ~~shares~~vendors converted $120,000 of ~~common~~amounts ~~stock~~owed to ~~various~~them ~~individuals~~by ~~for~~ the ~~exercise~~Company ofinto ~~170~~1,~~305 warrants~~255,230 ~~with~~shares ~~an exercise price~~ of ~~$0.13 per~~common ~~warrant and secured $22,139 in proceeds~~stock.

~~During the nine months ended April 30, 2023, the Company issued 3,000,000 shares of common stock in connection with the conversion of $150,000 of convertible promissory notes.~~32

During the nine months ended April 30, 2023, the Company issued 855,050 shares of common stock to various Series A Preferred Shareholders who converted 200,000 Series A Convertible Preferred Stock shares and $56,516 of accrued dividends.

During the nine months ended April 30, 2023, the Company issued 1,370,551 shares of common stock in conjunction with incentive plan accomplishments.

NOTE 12 – SUBSEQUENT EVENTS

Amendment to MEOA Business Combination

As previously disclosed, on August 30, 2022, the Company entered into a Business Combination Agreement (as it may be amended, supplemented or otherwise modified from time to time, the “Business Combination Agreement”), by and among the Company, MEOA, and MEOA Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of MEOA (“Merger Sub”).

The Business Combination Agreement provides, among other things, that Merger Sub will merge with and into Digerati, with Digerati as the surviving company in the merger and, after giving effect to such merger, Digerati shall be a wholly-owned subsidiary of MEOA (the “Merger”). Digerati after the Merger is referred to in this Note 12 as the “Surviving Company.”

On May 1, 2023, the Company and MEOA amended the Business Combination Agreement (amendment no. 3), in which Section 7.1(d) of the Business Combination Agreement eliminates the date of “April 28, 2023” as the Termination Date and replaced it with “May 30, 2023” as the Termination Date.

On May 30, 2023, the Company and MEOA amended its Business Combination Agreement (amendment no. 4), in which Section 7.1(d) of the Business Combination Agreement eliminates the date of “May 30, 2023” as the Termination Date and replaced with “June 15, 2023” as the Termination Date.

Securities Purchase Agreement and Promissory Notes

On May 9, 2023, the Company entered into a securities purchase agreement (the “SPA”) with Lucas Ventures, LLC, (the “Investor”). Pursuant to the SPA, the Investor purchased, and the Company issued, an unsecured promissory note (the “Note”) in the aggregate principal amount totaling approximately $55,000 (the “Principal Amount”) with an original issue discount of $5,000 and interest on the unpaid Principal Amount hereof at the rate of eight percent (8%). The gross proceeds the Company received prior to payment of transaction expenses were $50,000. The Note’s maturity date is February 9, 2024. The Company also issued 300,000 shares of restricted Common Stock to the Investor.

On May 10, 2023, the Company amended its Asset Purchase Agreement (amendment no. 4) with Skynet Telecom, LLC, Verve Cloud, Inc, a Texas entity (f/ka/ Shift8 Networks, Inc.); Digerati Technologies, Inc.; and Paul Golibart and Jerry Ou. The amendment states that $1,000,000 shall be paid to the seller by issuance of shares of restricted common stock of MEOA within five business days following the closing of the Merger.

On May 17, 2023, the Company amended its agreement (amendment no. 2) with Platinum Point Capital, LLC, which extends the maturity date from February 28, 2023 to July 31, 2023 in exchange for $8,250 to be added to the principal amount outstanding.

On May 17, 2023, the Company amended its agreement (amendment no. 1) with Platinum Point Capital, LLC, which extends the maturity date from April 10, 2023 to July 31, 2023 in exchange for $13,750 to be added to the principal amount outstanding.

On May 17, 2023, the Company amended its agreement (amendment no. 2) with Platinum Point Capital, LLC, which extends the maturity date from February 28, 2023 to July 31, 2023 in exchange for $7,137 to be added to the principal amount outstanding.

On May 24, 2023, the Company amended its agreement with ClearThink Capital Partners, LLC (“ClearThink”), which extends the due date of the principal payment balance to June 12, 2023 and adds $750 to the principal balance due.

On June 1, 2023, the Company amended its agreement (amendment no. 1) with Graham A. Gardner, which extends the maturity date from May 24, 2023 to the earlier of June 23, 2023 or the closing of the Merger in exchange for 165,000 shares of Common Stock.

On June 1, 2023, the Company amended its agreement (amendment no. 1) with Blue Ocean Investments, LLC which extends the maturity date from May 24, 2023 to the earlier of June 24, 2023 or the closing of the Merger in exchange for 165,000 shares of Common Stock.

Amendment to the 2015 Equity Compensation Plan (the “Plan”)

On May 27, 2023, the Board of Directors of the Company approved the amendment to the Plan where it amends the following: to allow for the grant of options to purchase up to 15,000,000 shares of Common Stock rather than 7,500,000 shares of Common Stock.

The Company granted 1,635,000 option shares for certain expired grant options; 1,825,000 option shares for the retirement and cancellation of certain outstanding options previously granted (in exchange for the issuance of new options); and 5,895,000 options to certain eligible participants. The granted options mentioned above have an exercise price of $0.095 per share, which has a vesting start date of June 1, 2023 and an expiration date of December 1, 2027.

Issuance of Common Stock

On May 10, 2023, the Company issued 1,180,000 shares of common stock to a former employee of the company who exercised his right to purchase the option shares for approximately $50,000.

On May 19, the Company issued 83,333 shares of common stock to a Series A Preferred Shareholders who converted 25,000 Series A Convertible Preferred Stock shares.

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. “Forward-looking statements” are those statements that describe management’s beliefs and expectations about the future. We have identified forward-looking statements by using words such as “anticipate,” “believe,” “could,” “estimate,” “may,” “expect,” “plan,” and “intend.” Although we believe these expectations are reasonable, our operations involve a number of risks and uncertainties. Some of these risks include the availability and capacity of competitive data transmission networks and our ability to raise sufficient capital to continue operations. Additional risks are included in our Annual Report on Form 10-K for the fiscal year ended July 31, ~~2022~~2023, filed with the Securities and Exchange Commission on ~~October~~November 3124, ~~2022~~2023.

The following Is a discussion of the unaudited interim consolidated financial condition and results of operations of Digerati for the three months ~~and nine months~~ ended ~~April~~October 3031, 2023 and 2022. It should be read in conjunction with our audited Consolidated Financial Statements, the Notes thereto, and the other financial ~~information~~ information included in the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, ~~2022~~2023, filed with the Securities and Exchange Commission on ~~October~~November 3124, ~~2022~~2023. For purposes of the following discussion, fiscal ~~2023~~2024 or ~~2023~~2024 refers to the year that will end on July 31, ~~2023~~2024, and fiscal ~~2022~~2023 or ~~2022~~2023 refers to the year ended July 31, ~~2022~~2023.

Overview

Digerati Technologies, Inc., a Nevada corporation (including our subsidiaries, “we,” “us,” “Company” or “Digerati”), through its operating subsidiaries, in(i) Verve Cloud, Inc. (formerly known as T3 communications, Inc.), a Nevada corporation (“Verve Cloud Nevada”), (ii) Verve Cloud, Inc. (formerly known as Shift8 Networks, Inc.), a Texas corporation (“Verve Cloud Texas”), (iii) T3 Communications, Inc., a Florida corporation (“T3 Communications”), (iv) Nexogy, Inc., a Florida corporation (“Nexogy”) and (v) NextLevel Internet, Inc., a California corporation (“Next Level” and, together with Verve Cloud Nevada, Verve Cloud Texas, T3 Communications and Nexogy, the “Operating Subsidiaries”)., which, as of June 1, 2023, operate as a single business unit under the Verve Cloud name and have locations in Texas, Florida and California, provides cloud services specializing in Unified Communications as a Service (“~~uCaaS~~UCaaS”) and broadband connectivity solutions for the business market. Our product line includes a portfolio of Internet-based telephony products and services delivered through our cloud application platform and session-based communication network and network services including Internet broadband, fiber, mobile broadband, and cloud Wide Area Network (“WAN”) ~~solutions~~or Software-defined Wide Area Network (“SD WAN”) solutions. Digerati Technologies, Inc. was incorporated in the State of Nevada in 1994.

~~Digerati~~We ~~Technologies~~provide enterprise-class, ~~Inc.~~carrier-grade ~~currently has four~~services ~~(4)~~to ~~operating~~the ~~subsidiaries:~~small-to-medium-sized business (i“SMB”) ~~Verve~~at ~~Cloud,~~cost-effective ~~Inc~~monthly rates., aOur ~~Texas~~UCaaS ~~entity~~or ~~(this~~cloud ~~entity~~communication ~~was~~services ~~formerly~~include fully ~~known~~hosted asInternet ~~Shift8~~Protocol ~~Networks, Inc.~~(“IP”);/private branch exchange (ii“PBX”), T3video ~~Communications~~conferencing, ~~Inc.~~ mobile applications, Voice aover ~~Florida~~Internet ~~entity;~~Protocol (~~iii~~“VoIP”) ~~Nexogy~~transport, ~~Inc.,~~Session aInitiation ~~Florida~~Protocol ~~entity;~~(“SIP”) trunking, and ~~(iv)~~customized VoIP ~~NextLevel~~services ~~Internet,~~all ~~Inc.,~~delivered aOnly ~~California~~in ~~entity~~the Cloud™. ~~Each~~Our ofbroadband ~~these~~connectivity ~~entities is~~solutions afor ~~subsidiary~~the delivery of ~~Verve~~digital ~~Cloud,~~oxygen are ~~Inc.~~designed for reliability, abusiness ~~Nevada~~continuity ~~entity~~and ~~(this~~to ~~entity~~optimize ~~was~~bandwidth ~~formerly~~for ~~known~~businesses asusing T3the ~~Communications,~~Company’s ~~Inc~~cloud communication services and other cloud-based applications.).

We provide enterprise-class, carrier-grade services to the small-to-medium-sized business (“SMB”) at cost-effective monthly rates. Our uCaaS or cloud communication services include fully hosted IP/PBX, video conferencing, mobile applications, Voice over Internet Protocol (“VoIP”) transport, SIP trunking, and customized VoIP services all delivered Only in the Cloud™. Our broadband connectivity solutions for the delivery of digital oxygen are designed for reliability, business continuity and to optimize bandwidth for businesses using the Company’s cloud communication services and other cloud-based applications.33

As a provider of cloud communications solutions to the SMB, we are seeking to capitalize on the migration by businesses from the legacy telephone network to the ~~Internet Protocol (“~~IP~~”) telecommunication~~ telecommunication network and the migration from hardware-based on-premise telephone systems to software-based communication systems in the cloud. Most SMBs are lagging in technical capabilities and advancement and seldom reach the economies of scale that their larger counterparts enjoy, due to their achievement of a critical mass and ability to deploy a single solution to a large number of workers. SMBs are typically ~~unable~~ unable to afford comprehensive enterprise solutions and, therefore, need to integrate a combination of business solutions to meet their needs. Cloud computing has revolutionized the industry and opened the door for businesses of all sizes to gain access to enterprise applications with affordable pricing. This especially holds true for cloud telephony applications, but SMBs are still a higher-touch sale that requires customer support for system integration, network installation, cabling, and troubleshooting. We have placed a significant emphasis on that “local” touch when selling, delivering, and supporting our services which we believe will differentiate us from the national providers that are experiencing high attrition rates due to poor customer support.

34The adoption of cloud communication services is being driven by the convergence of several market trends, including the increasing costs of maintaining installed legacy communications systems, the fragmentation resulting from use of multiple on-premise systems, and the proliferation of personal smartphones used in the workplace. Today, businesses are increasingly looking for an affordable path to modernizing their communications system to improve productivity, business performance and customer experience. Modernization has also led to businesses adopting other cloud-based business applications, including customer relationship management (“CRM”), payroll, and accounting software, placing an even more important emphasis on reliable Internet connectivity.

The adoption of cloud communication services is being driven by the convergence of several market trends, including the increasing costs of maintaining installed legacy communications systems, the fragmentation resulting from use of multiple on-premise systems, and the proliferation of personal smartphones used in the workplace. Today, businesses are increasingly looking for an affordable path to modernizing their communications system to improve productivity, business performance and customer experience. Modernization has also led to businesses adopting other cloud-based business applications, including CRM, payroll, and accounting software, placing an even more important emphasis on reliable Internet connectivity.

Our cloud solutions offer the SMB reliable, robust, and full-featured services at affordable monthly rates that eliminates high-cost capital expenditures and provides for integration with other cloud-based systems. By providing a variety of comprehensive and scalable solutions, we can cater to businesses of different sizes on a monthly subscription basis, regardless of the stage of development for the business.

~~Recent~~Non-GAAP ~~Developments~~Financial Measures - Reconciliation of Net Income (Loss) to Adjusted EBITDA – OPCO and Adjusted EBITDA – Income

~~MEOA~~EBITDA ~~Business~~from ~~Combination~~operations and income, as adjusted, are non-GAAP measures and should be considered in addition to, not as a substitute for, net income (loss), cash flow and other measures of financial performance reported in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In addition, this measure does not reflect cash available to fund requirements and excludes items, such as corporate expenses, transactional legal expenses, stock option expense, and depreciation and amortization, which are significant components in assessing the Company’s financial performance. The Company believes that the presentation of EBITDA from operations and income, as adjusted, provides useful information regarding the Company’s operations and other factors that affect the Company’s reported results. Specifically, the Company believes that by excluding certain one-time or non-cash items such as transactional legal fees and depreciation and amortization, as well as potential distortions between periods caused by factors such as financing and capital structures, the Company provides users of its consolidated financial statements with insight into both its operations as well as the factors that affect reported results between periods but which the Company believes are not representative of its operations. As a result, users of the Company’s consolidated financial statements are better able to evaluate changes in the financial consolidated results of the Company across different periods.

On August 30, 2022, the Company entered into a Business Combination Agreement (as it may be amended, supplemented or otherwise modified from time to time, the “Business Combination Agreement”), by and among Digerati, Minority Equality Opportunities Acquisition Inc., a Delaware corporation (“MEOA”), and MEOA Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of MEOA (“Merger Sub”).34

The ~~Business~~following ~~Combination~~tables ~~Agreement~~provide ~~provides,~~information ~~among~~regarding ~~other~~certain ~~things,~~non-GAAP ~~that~~financial ~~Merger~~measures ~~Sub~~for ~~will merge with and into~~ Digerati, ~~with~~for ~~Digerati as~~ the ~~surviving~~three ~~company~~months inended ~~the~~October ~~merger and~~31, ~~after~~2023 ~~giving effect~~and ~~to such merger, Digerati shall be a wholly-owned subsidiary of MEOA (the “Merger”)~~2022. InManagement ~~addition,~~utilizes ~~following~~these ~~the consummation~~metrics ofto ~~the~~track ~~Merger,~~and ~~MEOA~~forecast ~~will~~revenue betrends ~~renamed~~and ~~Verve~~expected ~~Technologies~~results ~~Corporation.~~from ~~Digerati after the Merger is referred to as the “Surviving Company.”~~operations:

AsConsolidated ~~previously~~Statement disclosed, in November and December 2022, Digerati issued the following securities to four (4) bridge lenders including Mast Hill Fund, L.P. (the “Bridge Lenders”): (a) unsecured promissory notes that are convertible into shares of Digerati’s common stock under certain circumstances; and (b) warrants to purchase shares of Digerati’s common stock. As used herein, “Bridge Loan Warrants” means those certain warrants to purchase up to 13,534,535 shares of Digerati’s common stock that Digerati issued to the Bridge Lenders. In March 2023, the Company issued other promissory notes with the some of the same lenders and, in connection with such notes, the Company issued certain warrants to purchase up to 3,707,186 shares of Digerati’s common stock.Operations

As(In ~~used herein, “New Digerati” refers to MEOA following the consummation of the Merger and “New Digerati Common Stock” means the common stock, par value $0.0001 per share, of New Digerati.~~thousands)

On February 14, 2023, the parties to the Business Combination Agreement amended the Business Combination Agreement (the “February Amendment”) to increase the implied equity value of Digerati from $68,680,807 to $71,080,810 to give effect to the issuance by Digerati to Maxim Group LLC (“Maxim”), immediately prior to the closing of the Merger, of such number of shares of Digerati’s common stock as would be exchanged for an aggregate of 240,000 shares of New Digerati Common Stock upon the closing of the Merger as partial compensation for financial advisory services that Maxim provided to Digerati in connection with the Business Combination. The February Amendment also clarified that the shares of Digerati common stock underlying the Bridge Loan Warrants would not be part of the calculation of the implied equity value of Digerati of $71,080,810, and it clarified that none of the shares underlying any of the convertible promissory notes of Digerati that are outstanding upon the closing of the Merger are part of the calculation of the implied equity value of Digerati of $71,080,810.

	Three months ended October 31,
	2023			2022			Variances			%
OPERATING REVENUES:
Cloud-based hosted services	$	7,654		$	8,130		$	(476	)		-6	%

Total operating revenues		7,654			8,130			(476	)		-6	%

Cost of services (exclusive of depreciation and amortization)		2,551			2,851			(300	)		-11	%
Selling, general and administrative expense		4,177			4,118			59			1	%
Stock compensation expense		12			23			(11	)		-48	%
Legal and professional fees		973			556			417			75	%
Bad debt		57			29			28			97	%
Depreciation and amortization expense		683			953			(270	)		-28	%

Total operating expenses		8,453			8,530			(77	)		-1	%

OPERATING LOSS		(799	)		(400	)		(399	)		100	%

OTHER INCOME (EXPENSE):
Loss on derivative instruments		(612	)		(3,076	)		2,464			-80	%
Other income (expense)		-			446			(446	)		-100	%
Interest expense		(3,041	)		(2,065	)		(976	)		47	%
Income tax expense		(28	)		(50	)		22			-44	%
Total other income (expense)		(3,681	)		(4,745	)		1,064			-22	%
NET INCOME (LOSS)		(4,480	)		(5,145	)		665			-13	%

Less: Net loss attributable to the noncontrolling interests		395			161			234			145	%

NET INCOME (LOSS) ATTRIBUTABLE TO DIGERATI’S SHAREHOLDERS	$	(4,085	)	$	(4,984	)	$	899			-18	%

Deemed dividend on Series A Convertible preferred stock		-			(4	)		4			-100	%

NET INCOME (LOSS) ATTRIBUTABLE TO DIGERATI’S COMMON SHAREHOLDERS	$	(4,085	)	$	(4,988	)	$	903			-18	%

InReconciliation ~~connection~~of ~~with~~Net ~~the~~Income ~~Merger, MEOA has filed with the Securities and Exchange Commission~~ (~~the “SEC”~~Loss) ~~a registration statement on Form S-4 containing the proxy statement/prospectus relating~~ to ~~the~~Adjusted ~~BCA (the “Registration Statement”), which the SEC has declared effective. On May 3, 2023, MEOA filed a definitive~~EBITDA ~~proxy~~- ~~statement/final prospectus relating to the Merger~~OPCO, ~~and~~Net thereafter MEOA mailed that definitive proxy statement/final prospectus and other relevant documents to its stockholders. On May 12, 2023, Digerati filed a definitive proxy statement in connection with Digerati’s solicitation of ~~proxies~~Non-Cash ~~for~~Expenses ~~its~~& special meeting of stockholders to be held to approve the Merger (and related matters) and thereafter Digerati mailed that definitive proxy statement and other relevant documents to its stockholders. This communication is not a substitute for the Registration Statement, the definitive proxy statement/final prospectus, the definitive proxy statement or any other document that Digerati has sent to its stockholders in connection with the Merger.Transactional

(In thousands)

	Three months ended October 31,
	2023			2022			Variances			%
NET INCOME (LOSS) ATTRIBUTABLE TO DIGERATI’S SHAREHOLDERS, as reported	$	(4,085	)	$	(4,984	)	$	899			-18	%

EXCLUDING NON-CASH ITEMS TRANSACTIONAL COSTS & CORP EXP
ADJUSTMENTS:
Stock compensation & warrant expense		12			23			(11	)		-48	%
Corp Expenses (Net of stock compensation, Legal fees & Transactional cost)		471			480			(9	)		-2	%
Legal, professional fees & transactional costs		837			219			618			282	%
Depreciation and amortization expense		683			953			(270	)		-28	%
OTHER ADJUSTMENTS
Gain (loss) on derivative instruments		612			3,076			(2,464	)		-80	%
Other income (expense)		-			(446	)		446			-100	%
Interest expense		3,041			2,065			976			47	%
Income tax expense		28			50			(22	)		-44	%
Less: Net loss attributable to the noncontrolling interests		(395	)		(161	)		(234	)		145	%
ADJUSTED EBITDA – OPCO	$	1,204		$	1,275		$	(71	)		-6	%
ADD-BACKS Expenses
Corp Expenses (Net of stock compensation, Legal fees & Transactional cost)		471			480			(9	)		-2	%
ADJUSTED EBITDA – INCOME	$	733		$	795		$	(62	)		-8	%

On February 24, 2023, the Company and MEOA amended its Business Combination Agreement (amendment #2), among other things, amended the following:

	Three months ended October 31,
Other Key Metrics	2023		2022		Variances			%
Total Customers		4,449		4,565		(116	)		-3	%

●Cloud ~~Section~~software ~~7.1(d)~~and ~~eliminates~~service revenue decreased by $476,000, or 6%, from the ~~date~~three ofmonths ~~“February~~ended 25October 31, ~~2023”~~2022 as compared to the ~~termination~~three ~~date~~months ~~and~~ended ~~replaces~~October it31, ~~with~~2023. aOur ~~termination~~gross ~~date~~margin decreased ofby ~~“April~~$176,000, 28or 3%, during quarter ended October 31, 2023.” The decrease in revenue is primarily attributed to the decrease in total customers. The Company’s total customers decreased by 116 customers, or 3%.

●EBITDA ~~The~~from ~~Company~~operations, ~~waives~~as adjusted, decreased by $71,000, or 6%, from the ~~requirement~~three ~~set~~months ~~forth~~ended inOctober ~~Section~~31, ~~5.7~~2022 ofas compared to the ~~Business~~three ~~Combination~~months ~~Agreement~~ended ~~that~~October ~~MEOA~~31, ~~have~~2023. ~~filed~~The primary reason for the ~~Registration~~decrease ~~Statement~~in onEBITDA ~~Form~~from ~~S-4~~operations nois ~~later~~due ~~than~~to 45the ~~days~~decrease ~~following~~in expenses and other adjustments, offset by the ~~date~~decrease in gross margin of $176,000 during the ~~Business~~three ~~Combination~~months ~~Agreement~~ended ~~and~~October ~~acknowledges~~31, ~~that~~2023. (See table above for the ~~aforementioned~~adjustments ~~Registration~~to ~~Statement~~Net ~~was~~Income ~~subsequently~~(Loss) ~~filed~~attributable onto Digerati ~~November~~shareholders.) 30EBITDA from operations, ~~2022~~as adjusted, is not intended to represent cash flows for the periods presented, nor have they been presented as an alternative to operating income or as an indicator of operating performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

●EBITDA ~~MEOA~~from ~~waives~~income, as adjusted, decreased by $62,000, or 8%, from the ~~following:~~quarter ended October 31, 2022 to the quarter ended October 31, 2023. The primary reason for the decrease in EBITDA from operations is due to decreases in expenses and adjustments during the three months ended October 31, 2023. EBITDA from income, as adjusted, is not intended to represent cash flows for the periods presented, nor have they been presented as an alternative to operating income or as an indicator of operating performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.

●Our ~~the~~total ~~requirement~~customers ~~set~~decreased ~~forth~~from in4,565 ~~Section 5.17 of~~ during the ~~Business~~three ~~Combination~~months ~~Agreement~~ended ~~that~~October ~~the~~31, ~~Company~~2022 ~~have~~to ~~delivered~~4,449 byfor nothe ~~later~~three ~~than~~months ~~September~~ended ~~15,~~October ~~2022~~31, ~~certain~~2023. ~~audited~~Going ~~and~~forward, ~~unaudited~~absent ~~financial~~future ~~statements~~acquisitions, we ~~and~~expect ~~acknowledges~~a ~~that~~net ~~the~~increase ~~aforementioned~~in ~~financial~~our ~~statements~~number ~~for~~of ~~its~~customers ~~fiscal~~of ~~year~~1% ~~ending~~to ~~July~~5% ~~31,~~each ~~2022~~fiscal ~~were delivered on October 31, 2022~~year.

● the requirement set forth in Section 5.22 of the Business Combination Agreement that the Company shall have caused Post Road Administrative LLC and its affiliate Post Road Special Opportunity Fund II LLP (collectively, “Post Road”), on or prior to October 15, 2022, to enter into the PRG Resolution Agreement, and acknowledges delivery of the executed PRG Resolution Agreement on February 7, 2023.

On May 1, 2023, the Company and MEOA amended its Business Combination Agreement (amendment #3), in which Section 7.1(d) of the Business Combination Agreement eliminates the date of “April 28, 2023” as the Termination Date and replaced with “May 30, 2023” as the Termination Date.

On May 30, 2023, the Company and MEOA amended its Business Combination Agreement (amendment #4) which extends the Termination Date from May 30, 2023 to June 15, 2023.

Key Performance indicators:

EBITDA from operations, as adjusted is a non-GAAP measure and should be considered in addition to, not as a substitute for, net income (loss), cash flow and other measures of financial performance reported in accordance with GAAP. In addition, this measure does not reflect cash available to fund requirements and excludes items, such as corporate expenses, transactional legal expenses, stock option expense, and depreciation and amortization, which are significant components in assessing the Company’s financial performance. The Company believes that the presentation of EBITDA from operations, as adjusted provides useful information regarding the Company’s operations and other factors that affect the Company’s reported results. Specifically, the Company believes that by excluding certain one-time or non-cash items such as transactional legal fees and depreciation and amortization, as well as potential distortions between periods caused by factors such as financing and capital structures, the Company provides users of its consolidated financial statements with insight into both its operations as well as the factors that affect reported results between periods but which the Company believes are not representative of its operations. As a result, users of the Company’s consolidated financial statements are better able to evaluate changes in the financial consolidated results of the Company across different periods.

The following tables provide information regarding certain key performance indicators for Digerati for the three and nine months ended April 30, 2023 and 2022. Management utilizes these metrics to track and forecast revenue trends and expected results from operations:

Reconciliation of Net Loss to Adjusted EBITDA

	Three months ended April 30,												Nine months ended April 30,
	2023			2022			Variances			%			2023			2022			Variances			%
OPERATING REVENUES:
Cloud-based hosted services	$	7,837		$	8,163		$	(326	)		-4	%	$	23,908		$	15,959		$	7,949			50	%
Total operating revenues		7,837			8,163			(326	)		-4	%		23,908			15,959			7,949			50	%
Cost of services (exclusive of depreciation and amortization)		2,879			3,161			(282	)		-9	%		8,698			6,203			2,495			40	%
Selling, general and administrative expense		4,299			4,268			31			1	%		12,852			8,136			4,716			58	%
Stock compensation expense		23			28			(5	)		-18	%		69			75			(6	)		-8	%
Legal and professional fees		681			756			(75	)		-10	%		2,311			2,505			(194	)		-8	%
Bad debt		37			36			1			3	%		106			51			55			108	%
Depreciation and amortization expense		993			1,540			(547	)		-36	%		2,912			2,514			398			16	%
Total operating expenses		8,912			9,789			(877	)		-9	%		26,948			19,484			7,464			38	%
OPERATING LOSS		(1,075	)		(1,626	)		551			-34	%		(3,040	)		(3,525	)		485			-14	%
OTHER INCOME (EXPENSE):
Gain (loss) on derivative instruments		2,120			6,827			(4,707	)		-69	%		2,893			7,835			(4,942	)		-63	%
Gain (loss) on extinguishment of debt		55			-			55			100	%		55			(5,480	)		5,535			-101	%
Other income (expense)		(1	)		2			(3	)		-150	%		455			-			455			100	%
Interest expense		(3,701	)		(1,676	)		(2,025	)		121	%		(8,137	)		(4,563	)		(3,574	)		78	%
Income tax expense		(51	)		(167	)		116			-69	%		(128	)		(285	)		157			-55	%
Total other income (expense)		(1,578	)		4,986			(6,564	)		-132	%		(4,862	)		(2,493	)		(2,369	)		95	%
NET INCOME (LOSS) INCLUDING NONCONTROLLING INTEREST		(2,653	)		3,360			(6,013	)		-179	%		(7,902	)		(6,018	)		(1,884	)		31	%
Less: Net loss attributable to the noncontrolling interests		409			546			(137	)		-25	%		898			1,306			(408	)		-31	%
NET INCOME (LOSS) ATTRIBUTABLE TO DIGERATI'S SHAREHOLDERS	$	(2,244	)	$	3,906		$	(6,150	)		-157	%	$	(7,004	)	$	(4,712	)	$	(2,292	)		49	%
Deemed dividend on Series A Convertible preferred stock		-			(4	)		4			-100	%		(8	)		(14	)		6			-43	%
NET INCOME (LOSS) ATTRIBUTABLE TO DIGERATI'S COMMON SHAREHOLDERS	$	(2,244	)	$	3,902		$	(6,146	)		-158	%	$	(7,012	)	$	(4,726	)	$	(2,286	)		48	%
Reconciliation of Net Income (Loss) to Adjusted EBITDA - OPCO, Net of Non-Cash Expenses & Transactional Costs.
NET INCOME (LOSS) ATTRIBUTABLE TO DIGERATI'S SHAREHOLDERS, as reported	$	(2,244	)	$	3,906		$	(6,150	)		-157	%	$	(7,004	)	$	(4,712	)	$	(2,292	)		49	%
EXCLUDING NON-CASH ITEMS TRANSACTIONAL COSTS & CORP EXP ADJUSTMENTS:
Stock compensation & warrant expense		23			28			(5	)		-18	%		69			75			(6	)		-8	%
Corp Expenses (Net of stock compensation, Legal fees & Transactional cost)		378			255			123			48	%		1,043			657			386			59	%
Legal, professional fees & transactional costs		680			862			(182	)		-21	%		2,308			2,730			(422	)		-15	%
Depreciation and amortization expense		993			1,540			(547	)		-36	%		2,912			2,514			398			16	%
OTHER ADJUSTMENTS
Gain (loss) on derivative instruments		(2,120	)		(6,827	)		4,707			-69	%		(2,893	)		(7,835	)		4,942			-63	%
Gain (loss) on extinguishment of debt		(55	)		-			(55	)		100	%		(55	)		5,480			(5,535	)		-101	%
Other income (expense)		1			(2	)		3			-150	%		(455	)		-			(455	)		100	%
Interest expense		3,701			1,676			2,025			121	%		8,137			4,563			3,574			78	%
Income tax expense		51			167			(116	)		-69	%		128			285			(157	)		-55	%
Less: Net loss attributable to the noncontrolling interests		(409	)		(546	)		137			-25	%		(898	)		(1,306	)		408			-31	%
ADJUSTED EBITDA - OPCO	$	999		$	1,059		$	(60	)		-6	%	$	3,292		$	2,451		$	841			34	%
ADD-BACKS Expenses
Corp Expenses (Net of stock compensation & Transactional cost)		378			255			123			48	%		1,043			657			386			59	%
ADJUSTED EBITDA - INCOME	$	621		$	804		$	(183	)		-23	%	$	2,249		$	1,794		$	455			25	%

	Three months ended April 30,									Nine months ended April 30,
Other Key Metrics	2023		2022		Variances		%			2023		2022		Variances		%
Total Customers		4,446		3,963		483		12	%		4,446		3,963		483		12	%

Three Months ended April 30, 2023 as Compared to the Three Months ended April 30, 2022.

Cloud software and service revenue decreased by $326,000, or 4%, from the three months ended April 30, 2022 as compared to the three months April 30, 2023. Our gross margin decreased by $44,000 from the three months ended April 30, 2022 as compared to the three months ended April 30, 2023.

EBITDA from operations, as adjusted, decreased from $1,059,000 from the three months ended April 30, 2022 to $999,000 for the three months ended April 30, 2023. See table above for the adjustments to Net Income (Loss) attributable to Digerati shareholders.

Nine months ended April 30, 2023 as Compared to the Nine months ended April 30, 2022.

Cloud software and service revenue increased by $7,949,000, or 50%, from the nine months ended April 30, 2022 as compared to the nine months April 30, 2023. In addition, our gross margin increased by $5,454,000, or 56%, from the nine months ended April 30, 2022 as compared to the nine months ended April 30, 2023. The increase in revenue and gross margin between years is primarily attributed to the increase in total customers between periods due to the acquisitions of Skynet Telecom LLC (“Skynet”) and Next Level.

EBITDA from operations, as adjusted, increased from $2,451,000 from the nine months ended April 30, 2022 to $3,292,000 for the nine months ended April 30, 2023. See table above for the adjustments to Net Income (Loss) attributable to Digerati shareholders.

EBITDA from operations, as adjusted is not intended to represent cash flows for the periods presented, nor have they been presented as an alternative to operating income or as an indicator of operating performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Our total customers increased from 3,963 at April 30, 2022 as compared to 4,446 at April 30, 2023. The increase in customers is attributed to the acquisitions and consolidation of Skynet and NextLevel during fiscal year ended July 31, 2022. Going forward, absent further acquisitions, we expect a net increase in our number of customers of 1% to 5% each fiscal year.

Sources of revenue:

Cloud Software and Service Revenue: We provide UCaaS or cloud communication services and managed cloud-based solutions to small and medium size enterprise customers and to other resellers. Our Internet-based services include fully hosted IP/PBX services, SIP trunking, call center applications, auto attendant, voice and web conferencing, call recording, messaging, voicemail to email conversion, integrated mobility applications that are device and location agnostic, and other customized IP/PBX features in a hosted or cloud environment. Other services include enterprise-class data and connectivity solutions through multiple broadband technologies including cloud WAN or SD-WAN ~~(Software-defined Wide Area Network)~~, fiber, mobile broadband, and Ethernet over copper. We also offer remote network monitoring, data backup and disaster recovery.

Direct Costs:

Cloud Software and Service: We incur bandwidth and colocation charges in connection with our UCaaS or cloud communication services. The bandwidth charges are incurred as part of the connectivity between our customers to allow them access to our various services. We also incur costs from underlying providers for fiber, Internet broadband, and telecommunication circuits in connection with our data and connectivity solutions.

Results of Operations

Three Months ended ~~April~~October 3031, 2023 as Compared to the Three ~~Months~~ Months ended ~~April~~October 3031, 2022.

Cloud Software and Service Revenue. Cloud software and service revenue decreased by $~~326~~476,000, or 46%, from the three months ended ~~April~~October 3031, 2022 as compared to the three months ended ~~April~~October 3031, 2023. ~~Although~~The ~~our~~decrease in revenue ~~decreased,~~is ~~our~~primarily attributed to the decrease in total customers. Our total number of customers decreased ~~increased~~ from 34,~~963~~565 for ~~the~~ three months ended ~~April 30~~October 31, 2022 to 4,~~446~~449 customers for the three months ended ~~April~~October 3031, 2023. AsOur ~~part of the acquisitions, our~~ primary emphasis is onto ~~integrating the~~increase ~~secured~~our ~~customers~~customer base, ~~consolidating~~growing ~~products and services, retaining~~ the monthly recuring revenue, and providing exceptional customer support.

Cost of Services (exclusive of depreciation and amortization). The cost of services decreased by $~~282~~300,000, or 911%, from ~~the~~ three months ended ~~April~~October 3031, 2022 as compared to the three months ended ~~April~~October 3031, 2023~~, which is consistent with the decrease in revenue mentioned above~~. ~~Although~~Our ~~our cost of services decreased, our~~ total number of customers ~~increased~~decreased from 34,~~963~~565 for the three months ended ~~April~~October 3031, 2022 to 4,~~446~~449 customers for the three months ended ~~April~~ 30October 31, 2023. Our consolidated gross margin ~~remained~~decreased ~~flat~~by ~~at approximately~~ $~~5.0~~176,000, ~~million~~or ~~for~~3%, from the ~~quarters~~three months ended ~~April~~October 3031, 2022 ~~and~~as compared to the three months ended October 31, 2023. We are not aware of any events that are reasonably likely to cause a material change in the relationship between our costs and our revenues.

Selling, General and Administrative (SG&A) Expenses (exclusive of legal and professional fees and stock compensation expense). SG&A expenses increased by $59,000, or 1%, from three months ended October 31, 2022 as compared to the three months ended October 31, 2023. The increase to SG&A expenses was partially due to an increase in headcount.

Stock Compensation expense. Stock compensation expenses decreased by $11,000, or 48%, from the three months ended October 31, 2022 as compared to the three months ended October 31, 2023. The decrease to stock-based compensation expense was primarily due increased vesting of stock options.

Legal and professional fees. Legal and professional fees increased by $417,000, or 75%, from the three months ended October 31, 2022 as compared to the three months ended October 31, 2023, which include legal and professional fees that relate to due diligence, audits for the acquisitions, purchase price allocation, legal fees paid in accordance with the Credit Agreement, dated as of November 17, 2020 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among the Operating Subsidiaries, Post Road Special Opportunity Fund II LLP (“PRSOF”), as a lender, the other lenders party thereto and Post Road Administrative LLC (“PR Administrative” and, together with its affiliate PRSOF, “Post Road”), as administrative agent for the lenders, to counsel for Post Road, and investor relations.

Bad debt. Bad debt increased by $28,000, or 97%, from the three months ended October 31, 2022 as compared to the three months ended October 31, 2023. The increase is attributed to the recognition of $57,000 in bad debt for accounts deemed uncollectible during the three months ended October 31, 2023. During the three months ended October 31, 2022, the Company recognized $29,000 in bad debt expense.

Depreciation and amortization. Depreciation and amortization decreased by $270,000, or 28%, from the three months ended October 31, 2022 as compared to the three months ended October 31, 2023. The decrease is primarily attributed to assets being fully amortized/depreciated, offset by the in amortization for Right-of-Use assets.

Operating loss. The Company reported an operating loss of $799,000 for the three months ended October 31, 2023 as compared to an operating loss of $400,000 for the three months ended October 31, 2022. The increase in operating loss of $399,000, or 100%, between periods is primarily due to net increases in SG&A (including stock-based compensation) of $48,000, an increase in legal and professional fees of $417,000, $,000 for bad debt, offset by decreases in cost of services (exclusive of depreciation and amortization) of $300,000, 270,000 for depreciation and amortization expense, and a decrease in gross margin of $176,000.

Loss on derivative instruments. The loss on derivative instruments decreased by $2,464,000, or 80.1%, from the three months ended October 31, 2022 to the three months ended October 31, 2023 was due to a slight increase in our common share price at October 31, 2023 as compared to July 31, 2023. We are required to re-measure all derivative instruments at the end of each reporting period and adjust those instruments to market. As a result of the re-measurement of all derivative instruments we recognized a gain or loss between periods.

Other income. Other income decreased by $446,000, or 100%, from the three months ended October 31, 2022 to the three months ended October 31, 2023 due primarily to the recognition of a gain on a settlement of conversion premium from a convertible note.

Interest expense. Interest expense increased by $976,000, or 47%, from the three months ended October 31, 2022 to the three months ended October 31, 2023, the Company recognized amortization of debt discount of $697,000 related to the adjustment to the present value of various convertible notes, debt, and warrants. Additionally, the Company recognized $1,984,000 of interest to Post Road for the accrual of PIK interest and amendment fees related to the forbearance agreements, and $360,000 added to various other promissory notes, all charged to interest expense as consideration for extension of the maturity dates.

Income tax expense. During the three months ended October 31, 2023, the Company recognized an income tax expense of $28,000. During the three months ended October 31, 2022 the Company recognized an income tax expense of $50,000.

Net loss including noncontrolling interest. Net loss including noncontrolling interest for the three months ended October 31, 2022 was $5,145,000 as compared to the net loss of $4,480,000 for the three months ended October 31, 2023. The improvement in net loss including noncontrolling interest between periods is primarily due to a decrease in total other expense of $1,064,000, offset by the increase in the operating loss of $399,000.

Net loss attributable to Digerati’s shareholders. Net loss for the three months ended October 31, 2023 was $4,085,000 as compared to a net loss for the three months ended October 31, 2022 of $4,984,000.

Deemed dividend on Series A Convertible Preferred Stock. Dividend accrued on convertible preferred stock for the three months ended October 31, 2023 and 2022 was $0 and $4,000, respectively.

Net loss attributable to Digerati’s common shareholders. Net loss for the three months ended October 31, 2023 was $4,085,000 compared to a net loss for the three months ended October 31, 2022 of $4,988,000.

Liquidity and Capital Resources

Cash Position: We had a consolidated cash balance of approximately $946,000 as of October 31, 2023. Net cash provided by operating activities during the three months ended October 31, 2023 was approximately $282,000. The increase in cash provided by operating activities resulted primarily from the net loss incurred during the three months ended October 31, 2023 as a result of operating expenses, that included $12,000 in stock compensation and warrant expense, bad debt expense of $57,000, non-cash lease expense of $218,000, amortization of debt discount of $697,000, depreciation and amortization expense of $683,000, loss on derivative liability of $612,000, common stock issued for debt extension charged to interest expense of $42,000, offset by the change in operating assets and liabilities which resulted in a net increase of $2,441,000.

~~Selling,~~Cash ~~General~~used ~~and~~in ~~Administrative~~investing ~~(SG&A) Expenses~~activities ~~(exclusive~~during ofthe ~~legal~~three months ~~and~~ended ~~professional~~October ~~fees~~31, ~~and~~2023 ~~stock~~was ~~compensation expense). SG&A expenses decreased by~~ $2696,000, orwhich ~~1%, from~~was ~~the~~used ~~three~~for ~~months ended April 30, 2022 as compared to~~ the ~~three~~acquisition ~~months~~of ~~ended April 30, 2023~~equipment.

~~Stock~~Cash ~~Compensation~~used ~~expense.~~in ~~Stock~~financing ~~compensation~~activities during the three ~~expense~~months ~~decreased~~ended byOctober $531,~~000,~~ or2023 ~~18%~~was $164,000 ~~from~~which ~~the~~included ~~three~~principal ~~months~~payments ~~ended~~on ~~April~~equipment ~~30,~~financing ~~2022~~and asborrowings ~~compared~~from toconvertible ~~the~~debt, net ~~three~~or ~~months~~original ~~ended~~issuance ~~April~~costs ~~30,~~and ~~2023~~discounts.

~~Legal~~Overall, ~~and~~our ~~professional~~net ~~fees.~~operating, ~~Legal~~investing, and financing ~~professional~~activities ~~fees~~during ~~decreased by $75,000, or 10%, from~~ the three months ended ~~April~~October 3031, ~~2022~~2023 asresulted ~~compared~~in toa ~~the~~net ~~three~~increase ~~months~~in ~~ended~~cash ~~April 30, 2023, which include legal~~ and ~~professional~~cash ~~fees~~equivalents ~~that relate to due diligence, audits~~ for ~~the acquisitions~~$22, purchase price allocation, legal fees paid to counsel for Post Road Administrative LLC and its affiliate Post Road Special Opportunity Fund II LLP (collectively, “Post Road”), and investor relations000.

~~Bad~~Digerati’s ~~debt.~~consolidated ~~Bad~~financial ~~debt increased by $1,000,~~statements orfor ~~3%, from~~ the three months ended ~~April~~October 3031, ~~2022~~2023 ashave ~~compared~~been toprepared ~~the~~on ~~three~~a ~~months~~going ~~ended~~concern ~~April 30~~basis, ~~2023.~~which ~~The~~contemplates ~~increase~~the isrealization ~~attributed~~of toassets and the ~~recognition~~settlement of ~~$37,000~~liabilities in ~~bad~~the ~~debt~~normal ~~for~~course ~~accounts~~of ~~deemed~~business. ~~uncollectible~~Since ~~three~~ the ~~nine~~Company’s ~~months~~inception ~~ended~~in ~~April 30~~1993, ~~2023.~~Digerati ~~During~~has ~~the~~incurred net ~~nine~~losses ~~months ended~~and ~~April~~accumulated ~~30,~~a ~~2022~~deficit of approximately $125,769,000 ~~the~~and ~~Company~~a ~~recognized~~working capital deficit of approximately $3669,321,000 inwhich ~~bad~~raises substantial ~~debt~~doubt about Digerati’s ability to continue as a going concern.

~~Depreciation~~We ~~and~~are ~~amortization~~currently taking initiatives to reduce our overall cash deficiencies on a monthly basis. ~~Depreciation~~To strengthen our business, we intend to adopt best practices from our recent acquisitions and ~~amortization~~invest ~~decreased~~in bya ~~$547~~marketing and sales strategy to grow our monthly recurring revenue; we anticipate utilizing our value-added resellers and channel partners to tap into new sources of revenue streams; and we have also secured numerous agent agreements through our recent acquisitions that we anticipate will accelerate revenue growth. In addition,~~000,~~ orwe ~~36%~~will continue to focus on selling a greater number of comprehensive services to our existing customer base. Further, ~~from~~in ~~the~~an ~~three~~effort ~~months~~to ~~ended~~increase ~~April~~our 30revenues, ~~2022~~we aswill ~~compared~~continue to evaluate the acquisition ~~three~~of ~~months~~various ~~ended~~assets ~~April 30~~with emphasis in VoIP Services and Cloud Communication Services. As a result, ~~2023~~during the process of evaluating such acquisitions we anticipate incurring significant legal and professional fees.

~~Operating loss.~~ The Company ~~reported~~anticipates anissuing ~~operating~~additional ~~loss~~equity, entering ofinto ~~$1,626,000~~additional ~~from~~convertible ~~the~~notes ~~three~~and/or ~~months~~obtaining ~~ended~~other ~~April~~indebtedness ~~30,~~to ~~2022~~secure asthe ~~compared~~funding required to anmeet these cash needs. ~~operating~~There ~~loss~~can ofbe ~~$1,075,000~~no ~~for~~assurance that the ~~three~~Company ~~months~~will ~~ended~~be ~~April~~able ~~30,~~to ~~2023~~raise additional funds or raise them on acceptable terms. ~~The~~If ~~decrease~~the inCompany ~~operating~~is unable ~~loss~~to ofobtain ~~$551,000~~financing oron ~~34%~~acceptable terms, ~~between periods~~the ~~was~~Company ~~primarily~~may ~~due~~not be able to ~~decreases~~meet ofits ~~depreciation~~interest payments, capital expenditures and ~~amortization~~operational needs. ~~expense~~As ofa ~~$547~~result,~~000,~~ ~~legal~~the ~~and~~Company ~~professional~~will ~~fees~~be ofrequired ~~$75,000, and~~to ~~gross~~negotiate ~~margin~~with its lender the terms of ~~$44,000,~~the ~~offset~~current byfinancing ~~increases~~agreements, in addition to ~~SG&A~~postponing the timing of ~~$31,000~~deployment of its capital expenditures and ~~$1,000~~extending ~~for~~the ~~bad~~timing ~~debts~~of the operational cash needs.

~~Gain~~The onCredit ~~derivative~~Agreement ~~instruments.~~contains ~~For~~customary ~~the~~representations, ~~three~~warranties, ~~months~~and ~~ended~~indemnification ~~April~~provisions. ~~30,~~The ~~2022,~~Credit ~~the~~Agreement ~~gain~~also oncontains ~~derivative~~affirmative ~~instruments~~and ~~was~~negative ~~$6,827,000~~covenants aswith ~~compared~~respect to ~~a gain of $2,120,000 for~~ the ~~three~~ ~~months~~operation ~~April 30, 2023, resulting in a decrease in value~~ of ~~$4,707,000, or 69%. We are required to re-measure all derivative instruments at~~ the ~~end~~business ~~of each reporting period~~ and ~~adjust~~properties ~~those instruments to market, as a result~~ of the ~~re-~~loan ~~measurement~~parties ofas ~~all~~well ~~derivative~~as ~~instruments we~~financial ~~recognized a gain or loss between periods~~performance.

~~Gain~~Below onare ~~extinguishment~~key offinancial ~~debt.~~covenant ~~For the three months ended April 30~~requirements, ~~2023, the gain on extinguishment of debt was $55,000. There was no gain~~ (~~loss~~measured quarterly) for the ~~extinguishment~~fiscal ~~of debt~~quarter ~~for~~ended ~~the~~October ~~three months April 30~~31, ~~2022.~~2023:

~~Other income~~● ~~(expense).~~Maximum–Allowed ~~Other~~- ~~expense~~Senior ~~was~~Leverage ~~$1,000~~Ratio ~~for~~of ~~the~~3.34 ~~three months April 30, 2023 as compared~~ to ~~other income of $2,000 for the three months ended April 30, 2022~~1. 00

~~Income~~● ~~tax~~Minimum–Allowed ~~expense.~~– ~~During~~EBITDA ~~the~~(on ~~three months ended April 30, 2023, the Company recognized~~ an ~~income~~annualized ~~tax~~basis) ~~expense~~ of $514,~~000. During the three months ended April 30~~710, ~~2022, the Company recognized an income tax expense of $167,000.~~385

~~Interest~~● ~~Income~~Minimum–Allowed ~~(expense).~~- ~~Interest~~Liquidity ~~expense increased~~of by $2,~~025,~~000, or 121%, from the three months ended April 30, 2022 as compared to the three months ended April 30, 2023. During the quarter ended April 30, 2023, the Company recognized amortization of debt discount of $1,254,000 related to the adjustment to the present value of various convertible notes and debt. Additionally, the Company recognized $1,051,000 in interest cash payments to Post Road, accrual of $179,000 for interest expense for various promissory notes and $131,000 fair value of shares issued as well as $1,088,000 added to the principal balance of various promissory notes, all charged to interest expense as consideration for extension of the maturity dates.

●

Maximum Allowed - Capital Expenditures of $94,798 (Quarterly)

●

Minimum–Allowed – Fixed Charge Coverage Ratio of 1.50 to 1.00

●

Maximum Allowed - Churn of 3.00% at any time

As of October 31, 2023, the Company was not in compliance with the financial covenants under the Credit Agreement. This noncompliance, together with certain other events of default that have occurred and are continuing under the Credit Agreement, resulted in our classifying the indebtedness under the Credit Agreement as a current liability.

~~Net~~The Operating Subsidiaries’ obligations ~~income~~under the Credit Agreement are secured by first priority security interests in (~~loss~~a) ~~including~~the ~~noncontrolling~~equity ~~interest.~~interests ~~Net~~of ~~loss~~the ~~including~~Operating ~~noncontrolling~~Subsidiaries (other ~~interest~~than ~~for~~Verve Cloud Nevada), pursuant to the ~~three~~Pledge ~~months~~Agreement, ~~ended~~dated ~~April~~November 3017, 2020 (the “Pledge Agreement”), made ~~2023~~by ~~was~~Verve Cloud Nevada in favor of ~~$2,653,000~~Post ~~compared~~Road toAdministrative and (b) substantially all of the ~~net~~other ~~income~~assets of $3the Operating Subsidiaries,~~360,000~~ pursuant ~~for~~to the ~~three~~Guaranty ~~months~~and ~~ending~~Collateral ~~April~~Agreement, 30dated November 17, 2020, subsequently amended on December 31, 2021, February 4, 2022~~. The~~, ~~net~~December ~~income~~15, ~~(loss)~~2022, ~~including~~and ~~noncontrolling~~February ~~interest~~3, ~~between~~2023 ~~periods~~(the is“Guaranty ~~primarily~~and ~~due~~Collateral toAgreement”), among the ~~increases~~Operating Subsidiaries and ~~decreases mentioned~~Post ~~above~~Road Administrative.

~~Net income (loss) attributable to the noncontrolling interest.~~ During the ~~three~~period ~~months~~beginning ~~ended~~on ~~April~~August 301, ~~2023 and 2022~~2021, ~~the consolidated entity recognized a net income in noncontrolling~~ ~~interest of $409,000~~ and aending ~~net~~on ~~loss~~October of31, ~~$546~~2023,~~000,~~ ~~respectively.~~the ~~The~~Company ~~noncontrolling~~and ~~interest~~Post isRoad ~~presented~~entered asinto aseveral ~~separate~~amendments ~~line~~and ~~item~~other ~~in the~~modifications ~~Company’s~~to ~~stockholders equity section of~~ the ~~balance~~Credit ~~sheet~~Agreement. Specifically:

~~Net~~● ~~income~~On ~~(loss)~~December ~~attributable~~15, 2022, Post Road agreed to ~~Digerati~~forbear from exercising its remedies in connection with the Company’s ~~shareholders.~~ ~~Net~~failure ~~loss~~to ~~for~~comply with the ~~three~~financial ~~months~~covenants ~~ended~~in ~~April~~the ~~30,~~Credit ~~2023~~Agreement ~~was $2,244,000~~ as ~~compared~~of tothe alast ~~net~~day ~~income~~of ~~for~~ the ~~three~~fiscal ~~months~~ quarter ended ~~April~~October 3031, 2022, ofas $3well as certain other specified defaults,~~906~~ until December 23,~~000~~ 2022.

~~Deemed~~● ~~dividend~~On onFebruary ~~Series~~3, A2023, ~~Convertible~~with ~~Preferred Stock~~an effective date of December 23, 2022, Digerati, the Operating Subsidiaries and Post Road entered into a Consent, Limited Waiver and Fourth Amendment to Credit Agreement and Amendment to Notes (the “Fourth Amendment”). ~~Dividend~~Among ~~accrued~~other onthings, ~~convertible~~the ~~preferred~~Fourth ~~stock~~Amendment ~~for~~(a) conditionally revised each of the ~~three~~six ~~months~~financial covenants set forth in the Credit Agreement (related to maximum leverage, minimum liquidity, minimum EBITDA, maximum capital expenditures, minimum interest coverage (a provision that replaced the minimum fixed charge coverage ratio provision), and maximum churn), (b) conditionally waived all then-existing events of default under the Credit Agreement and (c) modified the interest rates payable under the Credit Agreement. In addition, the Fourth Amendment provided that none of the revised financial covenants (other than minimum liquidity of $1,000,000, which was tested and met as of January 31, 2023) would be tested as of the last day of the fiscal quarter ended ~~April~~January 3031, 2023 so long as no additional events of default occurred prior to such date. The conditional revisions to the financial covenants and ~~2022~~the conditional waivers of existing events of default in the Fourth Amendment were contingent on the consummation of the Merger with MEOA by February 28, 2023 (the “Merger Outside Closing Date”). If the Merger was $0 not consummated by the Merger Outside Closing Date, the terms of the financial covenants would revert to the terms in effect immediately prior to the Fourth Amendment and $4the existing events of default would continue unwaived. The Merger Outside Closing Date was,~~000~~ as described below, ~~respectively~~ extended several times, but the termination of the Business Combination Agreement with MEOA has effectively nullified the revisions to the financial covenants and conditional waivers set forth in the Fourth Amendment.

~~Net~~● ~~income~~On ~~(loss)~~March ~~attributable~~13, to2023, Digerati~~’s common~~, ~~shareholders.~~the ~~Net~~Operating ~~income~~Subsidiaries, ~~for~~and Post Road entered into the ~~three~~Fifth ~~months~~Amendment ~~April~~to 30Credit Agreement, ~~2023~~with ~~was~~an $2effective date of February 28,~~244~~ 2023,~~000~~ aswhich ~~compared~~specifically toextended athe ~~net~~Merger ~~loss~~Outside ~~for~~Closing ~~the~~Date ~~three~~from ~~months ended~~February ~~April~~28, 302023, ~~2022~~to ofApril $328,~~902,000~~ 2023.

~~Nine~~● ~~months~~On ~~ended~~ April 303, 2023, asDigerati, ~~Compared~~the Operating Subsidiaries, and Post Road entered into a Sixth Amendment to its Credit Agreement (the ~~Nine~~“Sixth ~~months ended~~Amendment”), which (a) deferred the cash interest otherwise due and payable on April 301, ~~2022~~2023, to May 1, 2023, and (b) increased the net principal amount of additional convertible notes the Company was permitted by the Credit Agreement to have outstanding from $3,000,000 to $3,500,000.

~~Cloud~~● ~~Software~~On ~~and~~May ~~Service Revenue. Cloud software and service revenue increased by $7~~1,~~949,000,~~ ~~or 50%~~2023, ~~from~~with ~~the~~an ~~nine~~effective ~~months~~date ~~ended~~of April 3028, ~~2022~~2023, asDigerati, ~~compared to~~ the ~~nine~~Operating ~~months ended April 30~~Subsidiaries, ~~2023.~~and ~~The~~Post ~~increase~~Road inentered ~~revenue~~into isa ~~primarily~~Seventh ~~attributed~~Amendment to ~~the~~Credit ~~increase~~Agreement in(the ~~total~~“Seventh ~~customers~~Amendment”), ~~between~~pursuant ~~periods due~~ to ~~the~~which ~~acquisitions of Skynet in December 2021 and~~ the ~~acquisition~~Merger ofOutside ~~Next~~Closing ~~Level~~Date ~~Internet~~was inextended ~~February 2022. Our total number of customers increased~~ from ~~3,963 for the nine months ended~~ April 3028, ~~2022~~2023, to ~~4,446~~May ~~customers for the nine months ended April 30~~31, 2023~~. As part of the acquisitions~~, ~~our primary~~or ~~emphasis~~such islater ondate ~~integrating~~as ~~the~~agreed ~~secured~~to ~~customers~~in ~~base,~~writing ~~consolidating~~by ~~products~~Post ~~and~~Road ~~services,~~in ~~retaining~~its ~~the~~sole ~~monthly recuring revenue, and providing exceptional customer support~~discretion.

~~Cost of~~● ~~Services~~On ~~(exclusive~~August of16, ~~depreciation and amortization). The cost of services increased by $2~~2023,~~495,000,~~ ~~or 40%~~Digerati, ~~from~~ the ~~nine~~Operating ~~months ended~~Subsidiaries ~~April~~and ~~30,~~Post ~~2022~~Road asentered ~~compared~~into toa ~~the~~letter ~~nine months ended April 30~~agreement, ~~2023. The~~pursuant ~~increase in cost of services is primarily attributed~~ to ~~the~~which ~~consolidation~~Post ofRoad ~~various~~agreed ~~networks~~that asall ~~part~~accrued ofinterest ~~the~~that ~~increase~~was inoriginally ~~total customers between periods~~ due toand ~~the~~payable ~~acquisition of Skynet~~ in ~~December~~cash ~~2021~~by ~~and~~ the ~~acquisition~~Operating ofSubsidiaries ~~Next~~on ~~Level~~April ~~Internet~~3, in2023, ~~February~~May ~~2022.~~1, ~~Our~~2023, ~~total number~~June of1, ~~customers~~2023, ~~increased~~July ~~from~~ 3,~~963~~ ~~for~~2023 ~~the~~and ~~nine~~August ~~months~~1, ~~ended~~2023 ~~April 30~~would, ~~2022 to 4~~instead,~~446~~ ~~customers~~be ~~for~~added to the ~~nine~~outstanding ~~months~~principal ~~ended~~balances ~~April 30,~~of ~~2023.~~Term ~~Our~~Loan ~~consolidated~~A ~~gross~~and ~~margin~~Term ~~improved~~Loan ~~by $5~~C,~~454,000,~~ oras ~~56%~~applicable, ~~from~~under the ~~nine~~Credit ~~months~~Agreement ~~ended~~on ~~April~~the ~~30,~~effective ~~2022~~date asof ~~compared to~~ the ~~nine~~ ~~months~~letter ~~ended April 30~~agreement, ~~2023.~~and Wedue ~~are~~on ~~not~~the ~~aware~~maturity dates of ~~any~~such ~~events~~loans, ~~that~~along ~~are~~with ~~reasonably~~all ~~likely~~other toprincipal ~~cause a material change in the relationship between our costs~~ and ~~our~~interest ~~revenues~~amounts thereunder.

Selling, General and Administrative (SG&A) Expenses (exclusive of legal and professional fees and stock compensation expense). SG&A expenses increased by $4,710,000, or 57%, from the nine months ended April 30, 2022 as compared to the nine months ended April 30, 2023. The increase in SG&A is attributed to the acquisition of Skynet in December 2021 and the acquisition of Next Level Internet in February 2022; the Company absorbed all of the employees responsible for service delivery for the customer base, technical support, sales, customer service, and administration.

Stock Compensation expense. Stock compensation expense decreased by $6,000 from the nine months ended April 30, 2022 as compared to the nine months ended April 30, 2023.

Legal and professional fees. Legal and professional fees decreased by $194,000, or 8%, from the nine months ended April 30, 2022 as compared to the nine months ended April 30, 2023, which include legal and professional fees that relate to due diligence, audits for the acquisitions, purchase price allocation, legal fees paid to counsel for Post Road Group, and investor relations.

Bad debt. Bad debt increased by $55,000, or 108%, from the nine months ended April 30, 2022 as compared to the nine months ended April 30, 2023. The increase is attributed to the recognition of $106,000 in bad debt for accounts deemed uncollectible during the nine months ended April 30, 2023. During the nine months ended April 30, 2022, the Company recognized $51,000 in bad debt.

~~Depreciation~~Additionally, ~~and~~on ~~amortization.~~November ~~Depreciation~~22, 2023 (with effect from November 2, 2023), Verve Cloud, Inc. (“Verve Cloud”) and ~~amortization~~Verve ~~increased~~Cloud’s bysubsidiaries ~~$398~~(Verve Cloud and its subsidiaries,~~000~~ collectively, orthe ~~16%~~“Verve Cloud Nevada Parties”), ~~from~~Digerati ~~the~~and ~~nine~~Post ~~months~~Road ~~ended~~entered ~~April~~into 30a Second Forbearance Agreement, ~~2022~~Amendment to asLoan ~~compared~~Documents and Limited Consent, which (a) extends the maturity date of our Term Loan C Note with Post Road from November 2, 2023, to December 31, 2023, (b) provides that Post Road and the ~~nine~~other ~~months~~lenders ~~ended~~under ~~April~~the 30Credit Agreement shall forbear through December 31, 2023. ~~The~~from ~~increase~~exercising istheir ~~primarily~~rights ~~attributed~~and remedies under the loan documents and applicable law with respect to (i) certain existing events of default under the ~~acquisitions~~loan documents and ~~related~~(ii) ~~amortization~~certain ~~for~~events ~~intangible~~of ~~assets~~default that are expected to arise before December 31, 2023, and (c) amends certain provisions of the Credit Agreement and the other loan documents to allow the company to incur up to an additional ~~depreciation~~$2,000,000 of ~~related~~working tocapital financing. For additional information regarding the ~~assets~~Second ~~acquired~~Forbearance ~~from~~Agreement, ~~Skynet~~Amendment to Loan Documents and ~~NextLevel~~Limited Consent, see Note 12 - Subsequent Events to the Consolidated Financial Statements.

~~Operating~~We have been successful in raising debt and equity ~~loss.~~capital ~~The~~in ~~Company~~the ~~reported~~past anand ~~operating~~as ~~loss~~described ofin $3Notes 6,~~040~~ 7,~~000~~ ~~from~~and 8 to the ~~nine~~financial ~~months~~statements. ~~ended~~We ~~April~~have ~~30,~~financing ~~2023~~efforts asin ~~compared~~place to ~~an operating~~continue ~~loss~~to ofraise ~~$3,525,000~~cash ~~for~~through ~~the~~debt ~~nine~~and ~~months~~equity ~~ended~~offerings. ~~April~~Although ~~30,~~we ~~2022.~~have ~~The~~successfully ~~decrease~~completed infinancings ~~operating~~and ~~loss~~reduced ofexpenses ~~$485,000,~~in orthe ~~14%~~past, we ~~between~~cannot ~~periods~~assure ~~is primarily~~you ~~due~~that our plans to ~~net~~address ~~increases~~these matters in ~~SG&A~~the ~~for~~future ~~$4,710,000,~~will ~~cost~~be ofsuccessful. ~~services~~The ~~(exclusive~~Company ofwill ~~depreciation~~continue ~~and~~to ~~amortization)~~work ~~for~~with ~~$2,495,000,~~various ~~$55,000~~funding ~~for~~sources ~~bad~~to secure additional debt, and ~~$398,000~~equity ~~for~~financings. ~~depreciation~~However, ~~and~~Digerati ~~amortization~~cannot ~~expense,~~offer ~~offset~~any byassurance ~~the~~that ~~improvement~~it inwill ~~gross margin~~be ofsuccessful ~~$5,454,000~~in ~~and~~executing the ~~reduction~~aforementioned inplans ~~legal~~to ~~and~~continue ~~professional~~as ~~fees~~a ofgoing ~~$194,000~~concern.

~~Gain~~Management onbelieves ~~derivative~~that ~~instruments.~~available ~~The~~resources ~~gain~~as onof ~~derivative~~October ~~instruments~~31, ~~decreased~~2023, bywill $4not be sufficient to fund the Company’s operations,~~942,000~~ ~~from~~debt service and corporate expenses over the ~~nine~~next 12 months. ~~ended~~The ~~April~~Company’s 30ability to continue to meet its obligations and to achieve its business objectives is dependent upon, ~~2022~~among other asthings, ~~compared~~raising additional capital, issuing stock-based compensation to certain members of the ~~nine~~executive ~~months~~management ~~ended~~team ~~April~~in lieu 30of cash, ~~2023~~and/or generating sufficient revenue in excess of costs. WeAt ~~are~~such ~~required~~time as the Company requires additional funding, the Company will seek to resecure such best-~~measure~~efforts ~~all~~funding ~~derivative~~from ~~instruments~~various atpossible sources, including equity or debt financing, sales of assets, or collaborative arrangements. If the ~~end~~Company raises additional capital through the issuance of ~~each~~equity ~~reporting~~securities ~~period~~or securities convertible into equity, stockholders will experience dilution, and ~~adjust~~such securities may have rights, preferences, or privileges senior to those ~~instruments~~of the holders of common stock or convertible senior notes. If the Company raises additional funds by issuing debt, the Company may be subject to limitations ~~market~~on its operations, asthrough adebt ~~result~~covenants ofor other restrictions. If the ~~re-~~Company ~~measurement~~obtains ofadditional ~~all~~funds ~~derivative~~through ~~instruments~~arrangements wewith ~~recognized~~collaborators or astrategic ~~gain~~partners, the Company may be required to relinquish its rights to certain technologies. There can be no assurance that the Company will be able to raise additional funds or ~~loss~~raise ~~between~~them ~~periods~~on acceptable terms. If the Company is unable to obtain financing on acceptable terms, it may be unable to execute its business plan, the Company could be required to curtail its operations, and the Company may not be able to pay off its obligations, if and when they come due.

~~Gain~~Our ~~(loss)~~current oncash ~~extinguishment~~expenses ofare ~~debt.~~expected ~~For the~~to ~~nine~~be ~~months ended April 30, 2023, the gain on extinguishment of debt was~~ approximately $551,300,000. ~~For~~per ~~the nine months ended April 30~~month, ~~2022,~~including ~~the loss on extinguishment of debt was $5~~wages,~~480,000.~~ ~~On December 20~~rent, ~~2021~~utilities, ~~Verve~~corporate ~~Cloud~~expenses, ~~Inc.,~~and alegal ~~Nevada~~professional ~~entity~~fees ~~(“Verve~~associated ~~Cloud”)~~with ~~and~~potential ~~Post~~acquisitions. ~~Road~~As ~~entered~~described ~~into~~elsewhere anherein, ~~amendment~~we toare ~~the~~not ~~Credit~~generating ~~Agreement~~sufficient ~~(the~~cash ~~“Amendment”)~~from inoperations ~~connection~~to ~~with~~pay ~~which~~for ~~Verve~~our ~~Cloud~~corporate ~~issued an Amended~~ and ~~Restated~~ongoing ~~Term~~operating ~~Loan~~expenses, or Ato ~~Note~~pay ~~(the~~our ~~“A&R~~current ~~Term~~liabilities. ~~Loan~~As ~~A Note”) in replacement~~ of ~~the~~October ~~Term~~31, ~~Loan A Note. Under the First Amendment~~2023, ~~the~~ ~~Term~~our ~~Loan~~total Bliabilities ~~Note~~were ~~principal~~approximately of $373,~~500~~760,000, ~~accrued~~which ~~interest~~included of $~~187~~4,~~442~~737, ~~and amendment fee of $1,418,744 were recapitalized under the~~561 ~~revised~~in ~~A&R~~derivative ~~Term Loan A Note~~liabilities. ~~Pursuant~~We towill ~~the~~continue ~~First Amendment, the additional proceeds of $6,000,000 were used~~ to ~~fund~~use ~~the~~our ~~acquisition of~~available ~~Skynet~~cash ~~Telecom~~on ~~LLC’s~~hand ~~assets and for general corporate and working capital purposes as well as professional fees and other fees and expenses with respect~~ to ~~the~~cover ~~transactions~~our ~~contemplated~~deficiencies byin ~~the~~operating ~~Amendment~~expenses. ~~The~~Our ~~Company evaluated the amendment and the recapitalization~~cash ofrequirements ~~the~~to ~~notes~~meet ~~and~~our ~~accounted~~interest ~~for~~payments ~~these~~to ~~changes~~Post asRoad, ancapital ~~extinguishment~~expenditure ofneeds, ~~debt~~ and ~~recognized~~operational acash ~~loss~~flow onneeds ~~extinguishment~~over ofthe ~~debt~~next of18 ~~$5,480,000,~~months ~~which~~are isestimated ~~comprised~~to ofbe ~~the~~approximately ~~full amortization debt discount of~~ $43,~~061~~500,000 ~~and amendment fees of $1,419,000~~.

Other income (expense). Other income (expense) improved by $455,000 from the nine months ended April 30, 2022 as compared to the nine months ended April 30, 2023. The improvement in other income is mostly due to the recognition of a gain on a settlement of conversion premium of $466,000 from a convertible note.

Interest expense. Interest expense increased by $3,574,000 from the nine months ended April 30, 2022 as compared to the nine months ended April 30, 2023. During the nine months ended April 30, 2023, the Company recognized amortization of debt discount of $2,044,000 related to the adjustment to the present value of various convertible notes and debt. Additionally, the Company recognized $2,995,000 in interest cash payments to Post Road, accrual of $417,000 for interest expense for various promissory notes and $471,000 fair value of shares issued as well as $2,227,000 added to the principal balance of various promissory notes, all charged to interest expense as consideration for extension of the maturity dates.

Income tax benefit (expense). During the nine months ended April 30, 2023, the Company recognized an income tax expense of $128,000. During the nine months ended April 30, 2022 the Company recognized an income tax expense of $285,000.

Net loss including noncontrolling interest. Net loss including noncontrolling interest for the nine months ended April 30, 2022 was $6,018,000 as compared to the net loss of $7,902,000 for the nine months ended April 30, 2023. The net loss including noncontrolling interest between periods is primarily due to the increases and decreases mentioned above.

Net loss attributable to the noncontrolling interest. During the nine months ended April 30, 2023 and 2022, the consolidated entity recognized a net income in noncontrolling interest of $898,000 and a net loss of $1,306,000 respectively. The noncontrolling interest is presented as a separate line item in the Company’s stockholders equity section of the balance sheet.

Net income (loss) attributable to Digerati’s shareholders. Net loss for the nine months ended April 30, 2023 was $7,004,000 as compared to a net loss for the nine months ended April 30, 2022 of $4,712,000.

Deemed dividend on Series A Convertible Preferred Stock. Dividend accrued on convertible preferred stock for the nine months ended April 30, 2023 and 2022 was $8,000 and $14,000, respectively.

Net income (loss) attributable to Digerati’s common shareholders. Net loss for the nine months ended April 30, 2023 was $7,012,000 compared to a net income for the nine months ended April 30, 2022 of $4,726,000.

Liquidity and Capital Resources

Cash Position: We had a consolidated cash balance of approximately $997,000 as of April 30, 2023. Net cash used in operating activities during the nine months ended April 30, 2023 was approximately $3,100,000. The net cash used by operating activities resulted primarily from the net loss incurred during the nine months ended April 30, 2023 as a result of operating expenses, that included $81,000 in stock compensation and warrant expense, bad debt expense of $106,000, amortization of right-of-use assets for $624,000, gain on settlement of conversion premium for $466,000, amortization of debt discount of $2,104,000, gain on derivative liability of $2,893,000, gain on extinguishment of debt of $55,000, depreciation and amortization expense of $2,912,000, debt extension fee charged to interest expense for $689,000, and common stock issued for debt extension charged to interest expense for $505,000. The change in operating assets and liabilities resulted in a net increase of $1,196,000.

Cash used in investing activities during the nine months ended April 30, 2023 was $467,000, which was used for the acquisition of equipment.

Cash provided by financing activities during the nine months ended April 30, 2023 was $3,055,000. The net increase in cash provided by financing was primarily due to the Company securing $4,491,000 from convertible notes, net of issuance costs and discounts and securing $250,000 from debt financing from a related party, net of issuance costs and discounts, proceeds from the exercise of warrants of $22,000, offset by principal payments of $520,000 on various convertible notes, principal payments of $548,000 on debt, principal payments on related party notes of $568,000, and $72,000 in principal payments on equipment financing.

Overall, our net operating, investing, and financing activities during the nine months ended April 30, 2023 resulted in a net decrease in cash and cash equivalents for $512,000.

Digerati’s consolidated financial statements for the nine months ended April 30, 2023 have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. Since the Company’s inception in 1993, Digerati has incurred net losses and accumulated a deficit of approximately $120,397,000 and a working capital deficit of approximately $65,429,000 which raises doubt about Digerati’s ability to continue as a going concern.

We are currently taking initiatives to reduce our overall cash deficiencies on a monthly basis. During fiscal 2023 certain members of our management team will continue to receive a portion of their compensation in common stock to reduce the depletion of our available cash. To strengthen our business, we intend to adopt best practices from or recent acquisitions and invest in a marketing and sales strategy to grow our monthly recurring revenue; we anticipate utilizing our value-added resellers and channel partners to tap into new sources of revenue streams; and we have also secured numerous agent agreements through our recent acquisitions that we anticipate will accelerate revenue growth. In addition, we will continue to focus on selling a greater number of comprehensive services to our existing customer base. Further, in an effort to increase our revenues, we will continue to evaluate the acquisition of various assets with emphasis in VoIP Services and Cloud Communication Services. As a result, during the due diligence process we anticipate incurring significant legal and professional fees.

Our cash requirements to meet our interest payments to Post Road, capital expenditure needs, and operational cash flow needs over the next 18 months are estimated to be approximately $3,500,000. The Company anticipates issuing additional equity or entering into additional Convertible Notes to secure the funding required meet these cash needs. There can be no assurance that the Company will be able to raise additional funds or raise them on acceptable terms. If the Company is unable to obtain financing on acceptable terms, the Company may not be able to meet its interest payments, capital expenditures and operational needs. As a result, the Company will be required to negotiate with its lender the terms of the current financing agreements, in addition to postponing the timing of deployment of its capital expenditures and extending the timing of the operational cash needs.

The Credit Agreement contains customary representations, warranties, and indemnification provisions. The Credit Agreement also contains affirmative and negative covenants with respect to operation of the business and properties of the loan parties as well as financial performance. Below are key financial covenant requirements, (measured quarterly) for the fiscal quarter ended April 30, 2023:

● Maximum–Allowed - Senior Leverage Ratio of 6.18 to 1.00

● Minimum–Allowed – EBITDA (on an annualized basis) of $4,565,009

● Minimum–Allowed - Liquidity of $2,000,000

● Minimum–Allowed - Interest Coverage of 1.00 to 1.00

As of April 30, 2023, the Company was not in compliance with our financial covenants with Post Road, and as a result, the Notes were classified as current. The Company has requested that Post Road agree to forbear from exercising its remedies in connection with, among other things, the financial covenants that were not complied with during the quarter ended April 30, 2023. There can be no assurance that we will be able to restructure our financial covenants with Post Road. If the Company is not able to reach an agreement to restructure our financial covenants requirements and Post Road declares an event of default, it would have a material adverse effect on our business and financial condition, including the possibility of Post Road foreclosing on some or all of our assets.

On December 15, 2022, the lender agreed to forbear from exercising its remedies in connection with the financial covenants that were not complied with during the quarter ended October 31, 2022, as well as certain other specified defaults, until December 23, 2022.

On February 3, 2023, the Company, the Verve Cloud Nevada Parties (as defined in Note 2 to the financial statements), and Post Road entered into a Consent, Limited Waiver and Fourth Amendment to Credit Agreement and Amendment to the Notes (the “Fourth Amendment”). The Fourth Amendment is effective as of December 23, 2022. Among other things, the Fourth Amendment conditionally revises each of the six financial covenants set forth in Section 11.12 of the Credit Agreement (related to maximum leverage, minimum liquidity, minimum EBITDA, maximum capital expenditures, minimum interest coverage (a provision that replaces the minimum fixed charge coverage ratio provision), and maximum churn). In addition, pursuant to the Fourth Amendment, none of the financial covenants contained in Section 11.12 of the Credit Agreement, as amended by the Fourth Amendment, were to be tested as of the January 31, 2023 fiscal quarter end date so long as no events of default had occurred, other than minimum liquidity of $1,000,000, which was tested and met as of January 31, 2023. The Fourth Amendment provides that these revised financial covenants will be null and void if the Merger (as defined in Note 12) does not close by February 28, 2023 (the “Merger Outside Closing Date”), in which case the financial covenants in effect under Section 11.12 of the Credit Agreement shall automatically, and without notice to the Verve Cloud Nevada Parties, revert to those in effect immediately prior to the Fourth Amendment.

Pursuant to the Fourth Amendment, Post Road agreed to conditionally waive each and all of the Specified Defaults (as defined in the Fourth Amendment). Post Road’s waiver of the Specified Defaults are contingent on the Merger closing on or before the Merger Outside Closing Date in accordance with the Business Combination Agreement (as defined in Note 12) and no events of default (other than the Specified Defaults) or any condition or event that, with the giving of notice or the lapse of time or both, would constitute an event of default, existing under the Credit Agreement on the Merger closing date.

The Fourth Amendment amends the Credit Agreement and the Notes to modify the interest rate payable by Verve Cloud.

On March 13, 2023, the Company, the Verve Cloud Nevada Parties, and Post Road entered into the Fifth Amendment to Credit Agreement, with an effective date of February 28, 2023, which specifically revises the Merger Outside Closing Date, replacing the “February 28, 2023” date with “April 28, 2023,” without amending, supplementing or otherwise modifying any other terms, or any of the conditions, set forth in the Credit Agreement.

On April 3, 2023, the Company, the Verve Cloud Nevada Parties, and Post Road entered into a Sixth Amendment to its Credit Agreement (the “Sixth Amendment”). Pursuant to the Sixth Amendment, Post Road agreed to increase the aggregate net unpaid principal amount (i.e., less original issue discounts and transaction costs paid in cash by Company upon the closing thereof and disclosed in writing to Post Road) the Company is allowed to borrow in the form of convertible loans to $3,500,000. This amount was increased from the $3,000,000 agreed to by Post Road pursuant to the Fourth Amendment.

Pursuant to the Sixth Amendment, Post Road agreed to defer the cash interest otherwise due and payable on April 1, 2023 to the May 1, 2023 payment date.

On May 1, 2023, the Company, the Verve Cloud Nevada Parties, and Post Road entered into a Seventh Amendment to Credit Agreement (the “Seventh Amendment”). The Seventh Amendment is dated as of May 1, 2023, with an effective date of April 28, 2023. Pursuant to the Seventh Amendment, the Merger Outside Closing Date was amended to May 31, 2023, or such later date as agreed to in writing by Post Road in its sole discretion.

The Seventh Amendment also modified the negative covenants set forth in the Credit Agreement to add a new section on material nonpublic information (“MNPI”). The Seventh Amendment’s modifications to the Credit Agreement provide that if Post Road elects not to receive MNPI from the Company during any period during which the Company is obligated to deliver a notice to Post Road which notice would include MNPI, the Company will inform Post Road of its obligation to deliver the notice, and Post Road will inform the Company whether it elects to receive such notice. If Post Road elects to receive the notice of MNPI, the Company shall deliver such notice in accordance with the Credit Agreement, and if Post Road elects not to receive such notice, the Company shall not deliver the notice and Post Road shall have waived its rights to receive delivery of the notice. Any election by Post Road to waive their right to receive delivery of any notice of MNPI applies only with respect to the specific notice and not to any subsequent notice.

Pursuant to the Seventh Amendment, Post Road agreed to defer the cash interest otherwise due and payable on April 1, 2023 and May 1, 2023 to the June 1, 2023 payment date.

While Digerati, the parent company of Verve Cloud, is not subject to these financial covenants, they have had and will continue to have a material impact on Verve Cloud’s expenditures and ability to raise funds.

In addition, our Term Loan C Note payable to Post Road with a maturity date of August 4, 2023, requires a full principal payment and accrued interest by the maturity date. We will work with our equity partners to secure additional financings to meet this obligation by the maturity date. In addition, we will work with our lender on the current terms to the Term Loan C Note, to extend the maturity date or restructure the terms of the note. There can be no assurance that the Company will be able to raise additional funds or raise them on acceptable terms to meet the cash payment requirements on the Term Loan C Note. In addition, there can be no assurance that we will be able to restructure the terms or extend the maturity date of the Term Loan C Note with Post Road. If the Company is not able to restructure the financing or repay the Term Loan C Note by the August 4th maturity date and Post Road declares an event of default, it would have a material adverse effect on our business and financial condition, including the possibility of Post Road foreclosing on some or all of our assets.

We have been successful in raising debt and equity capital in the past and as described in Notes 6, 7, 8, and 12. We have financing efforts in place to continue to raise cash through debt and equity offerings. Although we have successfully completed financings and reduced expenses in the past, we cannot assure you that our plans to address these matters in the future will be successful.

The current Credit Agreement with Post Road will allow the Company to continue acquiring UCaaS service providers that meet the Company’s acquisition criteria. Management anticipates that future acquisitions will provide additional operating revenues to the Company as it continues to execute on its consolidation strategy. There can be no guarantee that the planned acquisitions will close or that they will produce the anticipated revenues on the schedule anticipated by management.

The Company will continue to work with various funding sources to secure additional debt and equity financings. However, Digerati cannot offer any assurance that it will be successful in executing the aforementioned plans to continue as a going concern.

Management believes that available resources as of April 30, 2023, will not be sufficient to fund the Company’s operations, debt service and corporate expenses over the next 12 months. The Company’s ability to continue to meet its obligations and to achieve its business objectives is dependent upon, and other things, raising additional capital, issuing stock-based compensation to certain members of the executive management team in lieu of cash, or generating sufficient revenue in excess of costs. At such time as the Company requires additional funding, the Company will seek to secure such best-efforts funding from various possible sources, including equity or debt financing, sales of assets, or collaborative arrangements. If the Company raises additional capital through the issuance of equity securities or securities convertible into equity, stockholders will experience dilution, and such securities may have rights, preferences, or privileges senior to those of the holders of common stock or convertible senior notes. If the Company raises additional funds by issuing debt, the Company may be subject to limitations on its operations, through debt covenants or other restrictions. If the Company obtains additional funds through arrangements with collaborators or strategic partners, the Company may be required to relinquish its rights to certain technologies. There can be no assurance that the Company will be able to raise additional funds or raise them on acceptable terms. If the Company is unable to obtain financing on acceptable terms, it may be unable to execute its business plan, the Company could be required to curtail its operations, and the Company may not be able to pay off its obligations, if and when they come due.

Our current cash expenses are expected to be approximately $1,300,000 per month, including wages, rent, utilities, corporate expenses, and legal professional fees associated with potential acquisitions. As described elsewhere herein, we are not generating sufficient cash from operations to pay for our corporate and ongoing operating expenses, or to pay our current liabilities. As of April 30, 2023, our total liabilities were approximately $69,632,000, which included $7,759,000 in derivative liabilities. We will continue to use our available cash on hand to cover our deficiencies in operating expenses.

Item 3. Quantitative and Qualitative Disclosures About Market Risks.

Not Applicable.

Item 4. Controls and Procedures.

(a) Evaluation of Disclosure Controls and Procedures

In connection with the preparation of this quarterly report on Form 10-Q for the quarter ended ~~April~~October 3031, 2023, our Principal Executive Officer (“PEO”) and Principal Financial Officer (“PFO”) evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our PEO and PFO concluded that our disclosure controls and procedures as of the end of the period covered by this report were not effective such that the information required to be disclosed by us in reports filed under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our Chief Executive Officer and Principal Financial Officer, as appropriate to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

(b) Changes in Internal Controls over Financial Reporting

There were no changes in our internal control over financial reporting, as defined in Rule 13a-15(f) or 15d-15(f) under the Securities Exchange Act of 1934, during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting, as there has been no implementation to date of processes and/or procedures to remedy internal control weaknesses and deficiencies.

4542

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

OnFrom ~~September~~time ~~21,~~to ~~2021~~time, ~~T3 Communications, Inc.(“T3”), a subsidiary of~~ the Company, ~~entered~~may ~~into~~become a ~~settlement agreement with Carolina Financial Securities, LLC (“CFS”). Under the~~defendant ~~settlement~~in ~~agreement~~litigation ~~the~~arising ~~parties~~out ~~agreed~~of ~~to resolve all issues and claims related to~~ the ~~lawsuit.~~ordinary ~~Pursuant~~course ~~to the settlement agreement, T3 agreed to pay CFS a total~~ of ~~$300,000, payable as follows: $100,000 by October 15, 2021, and $200,000 payable in 15 monthly installments of $13,333~~business.33 ~~beginning November 15, 2021.~~ As of ~~April~~October 3031, 2023, ~~and~~the ~~July~~Company ~~31,~~is ~~2022,~~not ~~the~~party ~~outstanding~~to ~~balances~~any ~~were~~material ~~$0 and $80,000,~~pending ~~respectively~~legal proceedings.

Item 1A. Risk Factors.

Not Applicable

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

There were no unregistered sales of the Company’s equity securities during the quarter ended ~~April~~October 3031, 2023 that were not previously reported in a Current Report on Form 8-K except as follows. The sales and issuances of the securities described below were made pursuant to the exemptions from registration contained into Section 4(a)(2) of the Securities Act and Regulation D under the Securities Act. Each purchaser represented that such purchaser’s intention to acquire the shares for investment only and not with a view toward distribution. We requested our stock transfer agent to affix appropriate legends to the stock certificate issued to each purchaser and the transfer agent affixed the appropriate legends. Each purchaser was given adequate access to sufficient information about us to make an informed investment decision. Except as described in this prospectus, none of the securities were sold through an underwriter and accordingly, there were no underwriting discounts or commissions involved.

During the three months ended ~~April~~October 3031, 2023, the Company issued ~~899~~990,~~500~~ 000 shares of common stock inas ~~connection~~consideration ~~with~~for ~~new~~the ~~convertible~~extension ~~promissory notes.~~of Atmaturity ~~the~~dates ~~time~~for ofthe ~~issuance,~~convertible ~~the~~promissory notes. The Company recognized the ~~relative~~ fair market value of the common shares of approximately $7542,000 ~~as debt~~ ~~discount,~~which ~~and~~was itrecognized ~~will~~as ~~be amortized to~~ interest ~~expense during~~ at the ~~term~~time of ~~the~~each ~~promissory notes~~extension.

~~During the~~On ~~three~~November ~~months ended April 30~~9, 2023, ~~the~~one ~~Company~~of ~~issued~~our 2vendors converted $120,~~180,~~000 ~~shares~~ of ~~common~~amounts ~~stock~~owed asto ~~consideration~~them ~~for~~by the ~~extension of maturity dates for the convertible promissory notes. The~~ Company ~~recognized~~into ~~the~~1,255,230 ~~fair~~shares ~~market value~~ of ~~the~~ common ~~shares of approximately $165,000 which was recognized as interest at the time of each extension~~stock.

During the three months ended April 30, 2023, the Company issued 1,500,000 shares of common stock in connection with the conversion of $75,000 of convertible promissory notes.

During the three months ended April 30, 2023, the Company issued 1,370,551 shares of common stock in conjunction with incentive plan accomplishments.

Item 3. Defaults Upon Senior Securities.

None

Item 4. Mine Safety Disclosures.

Not Applicable

Item 5. Other Information.

None

Item 6. Exhibits

Number		Description
2.1		Amendment No. 1 to Business Combination Agreement, dated as of February 14, 2023 (filed as Exhibit 2.1 to the Current Report on Form 8-K filed on February 17, 2023).
10.1		Letter Agreement to Credit Agreement, dated August 16, 2023 (filed as Exhibit 10.1 to the Current Report on Form 8-K filed on August 21, 2023).
2.2		Amendment No. 2 to Business Combination Agreement, dated as of February 24, 2023 (filed as Exhibit 2.1 to the Current Report on Form 8-K filed on March 1, 2023).
10.2		Second Forbearance Agreement, Amendment to Loan Documents and Limited Consent, dated November 22, 2023 with effect from November 2, 2023, by and among Verve Cloud, Inc. (formerly known as T3 Communications, Inc.), the guarantors named therein, Digerati Technologies, Inc., Post Road Administrative LLC, and Post Road Special Opportunity Fund II LP (filed as Exhibit 10.44 to the Annual Report on Form 10-K filed on November 24, 2023).
4.1		Convertible Promissory Note for $110,000 with LGH Investments, LLC dated March 7, 2023 (filed as Exhibit 4.1 to the Current Report on Form 8-K filed on April 6, 2023).
10.3		Form of Extension and Forbearance Agreement, dated as of November 22, 2023, between Digerati Technologies, Inc. and the noteholder named therein (filed as Exhibit 10.45 to the Annual Report on Form 10-K filed on November 24, 2023).
4.2*		Convertible Promissory Note for $192,000 with Mast Hill Fund, L.P. dated March 17, 2023.
31.1*		Certification of our President and Chief Executive Officer, under Section 302 of the Sarbanes-Oxley Act of 2002.
4.3		Convertible Promissory Note for $275,000 with MGR Limited Partnership dated April 14, 2023 (filed as Exhibit 4.1 to the Current Report on Form 8-K filed on May 15, 2023).
31.2*		Certification of our Chief Financial Officer, under Section 302 of the Sarbanes-Oxley Act of 2002.
4.4*		Amendment 3 to Convertible Promissory Note for $50,000 with Tysadco Partners, LLC, dated February 1, 2023 (extension of maturity date).
32.1**		Certification of our President and Chief Executive Officer, under Section 906 of the Sarbanes-Oxley Act of 2002.
4.5*		Amendment 3 to Convertible Promissory Note for $50,000 with Tysadco Partners, LLC, dated April 14, 2023 (extension of maturity date).
32.2**		Certification of our Chief Financial Officer, under Section 906 of the Sarbanes-Oxley Act of 2002.
4.6*		Amendment 5 to Convertible Promissory Note for $25,000 with Lucas Ventures, LLC dated March 30, 2023 (extension of maturity date).
101.INS*		Inline XBRL Instance Document.
4.7*		Amendment 2 to Convertible Promissory Note for $18,000 with Tysadco Partners, LLC dated February 28, 2023 (extension of maturity date).
101.SCH*		Inline XBRL Taxonomy Extension Schema Document.
4.8*		Amendment 2 to Convertible Promissory Note for $18,000 with Tysadco Partners, LLC dated March 29, 2023 (extension of maturity date).
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
4.9*		Amendment 2 to Convertible Promissory Note for $30,000 with Tysadco Partners, LLC dated April 29, 2023 (extension of maturity date).
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.
4.10*		Amendment 2 to Convertible Promissory Note for $30,000 with Lucas Ventures, LLC dated April 25, 2023 (extension of maturity date).
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document.
4.11		Form of Promissory Note issued by Digerati Technologies, Inc. to the Three December Investors, dated December 12th, 20th, and 22nd, 2022 (filed as Exhibit 4.2 to the Current Report on Form 8-K filed on February 7, 2023).
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
4.12*		Form of Warrant Agreement with Mast Hill Fund, L.P. dated March 17, 2023.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
4.13*		Form of Warrant Agreement with 3BRT Investments, LP dated March 30, 2023.
4.14*		Amendment 3 to Convertible Promissory Note for $117,467 with ClearThink Capital Partners, LLC dated May 24, 2023 (extension of first principal payment).
4.15*		Amendment 1 to Convertible Promissory Note for $660,000 with Graham A. Gardner dated June 1, 2023 (extension of maturity date).
4.16*		Amendment 1 to Convertible Promissory Note for $660,000 with Blue Ocean Investments, LLC dated June 1, 2023 (extension of maturity date).
4.17		Convertible Promissory Note for $55,000 with Lucas Ventures, LLC dated May 9, 2023 (filed as Exhibit 4.2 to the Current Report on Form 8-K filed on May 15, 2023).

10.1		Securities Purchase Agreement for $110,000 LGH Investments dated March 7, 2023 (filed as Exhibit 10.1 to the Current Report on Form 8-K filed on April 6, 2023).
10.2*		Securities Purchase Agreement for $192,000 Mast Hill dated March 17, 2023.
10.3*		Amendment 4 to the Securities Purchase Agreement by Skynet Telecom, LLC dated May 10, 2023.
10.4*		Amendment to the Company’s 2015 Equity Compensation Plan dated May 25, 2023 (increases the number of Common Shares available for Stock Option grants).
10.5*		Forbearance Agreement to Equity Purchase Agreement by T3 Communications, Inc. and The Jerry and Lisa Morris Revocable Trust dated May 1, 2023.
10.6*		Forbearance Agreement to Equity Purchase Agreement by T3 Communications, Inc. and Jeffery Posner dated May 1, 2023.
10.7		Consent, Limited Waiver and Fourth Amendment to Credit Agreement and Amendment to Notes by and among T3 Communications, Inc., the Subsidiaries of T3 Communications (including Next Level Internet, Inc.), Post Road Special Opportunity Fund II LP, and Post Road Administrative LLC, dated as of February 3, 2023 (filed as Exhibit 10.1 to the Current Report on Form 8-K filed on February 9, 2023).
10.8		Fifth Amendment to Credit Agreement by and among T3 Communications, Inc., the Subsidiaries of T3 Communications (including Next Level Internet, Inc.), Post Road Special Opportunity Fund II LP, and Post Road Administrative LLC, dated as of March 13, 2023 (filed as Exhibit 10.11 to the Quarterly Report on Form 10-Q filed on March 17, 2023.
10.9		Sixth Amendment to Credit Agreement and Amendment to Notes by and among T3 Communications, Inc., the Subsidiaries of T3 Communications (including Next Level Internet, Inc.), Post Road Special Opportunity Fund II LP and Post Road Administrative LLC, dated as of April 3, 2023 (filed as Exhibit 10.2 to the Current Report on Form 8-K filed on April 6, 2023.
10.10		Securities Purchase Agreement for $55,000 with Lucas Ventures, LLC dated May 9, 2023 (filed as Exhibit 10.1 to the Current Report on Form 8-K filed on May 15, 2023).
31.1*		Certification of our President and Chief Executive Officer, under Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of our Chief Financial Officer, under Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**		Certification of our President and Chief Executive Officer, under Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**		Certification of our Chief Financial Officer, under Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*		Inline XBRL Instance Document.
101.SCH*		Inline XBRL Taxonomy Extension Schema Document.
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

*	Filed herewith

**	Furnished herewith

4843

SIGNATURES

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

	DIGERATI TECHNOLOGIES, INC.
Date: June 15, 2023	By:	/s/ Arthur L. Smith
Date: December 22, 2023	By:	/s/ Craig K. Clement
	Name:	~~Arthur~~Craig LK. ~~Smith~~Clement
	Title:	~~President~~Chairman ~~and~~of the Board of Directors &
		Chief Executive Officer
		Interim Chief Executive Officer
		(Duly Authorized Officer and Principal Executive Officer)

Date: June 15, 2023	By:	/s/ Antonio Estrada Jr.
Date: December 22, 2023	By:	/s/ Antonio Estrada Jr.
	Name:	Antonio Estrada Jr.
	Title:	Chief Financial Officer
		(Duly Authorized Officer and Principal Financial Officer)

4944

Digerati Technologies, Inc. NONE The Company determines at each reporting period if any default provisions and other requirements triggered a variable conversion price and if the note needs to be classified as a derivative instrument. The Company evaluated the amendment(s) and accounted for these changes as an extinguishment of debt. The Company analyzed the Note and determined that it does not require to be accounted as a derivative instrument. 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