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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark one)

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

For the quarterly period ended June 30, 2024

☐	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _________ to ___________

Accredited Solutions, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Nevada		000-54509		45-2578051
(State of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

20311 Chartwell Center Drive, Suite 1469

Cornelius, North Carolina 28031

1-800-947-9197

(Address of principal executive offices) (Zip code)

(Issuer’s telephone number)

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Not applicable.	Not applicable.	Not applicable.

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 checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

As of August 22, 2024, there were 2,109,045,863 shares of common stock, par value $0.001 per share issued, issuable and outstanding.

ACCREDITED SOLUTIONS, INC.

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Index to Financial Statements

		Page

Condensed Consolidated Balance Sheets as of June 30, 2024 (Unaudited), and December 31, 2023		3
Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2024 and 2023 (Unaudited)		4
Condensed Consolidated Statement of Stockholders’ Deficit for the Six Months Ended June 30, 2024 and 2023 (Unaudited)		5
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023 (Unaudited)		6
Notes to Condensed Consolidated Financial Statements (Unaudited)		7

Table of Contents

ACCREDITED SOLUTIONS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	June 30, 2024			December 31, 2023
Current assets
Cash	$	6,779		$	919
Accounts receivable		-			64,109
Prepaid expenses		1,834			3,904
Advance due from related entity		1,293			-
Total current assets		9,906			68,932

Other assets
Property, plant and equipment, net		54,785			60,573
Intellectual property		100,000			100,000
Total assets	$	164,691		$	229,505

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable	$	145,974		$	159,506
Advances payable		39,450			-
Advances payable - related parties		12,350			39,450
Accrued liabilities		3,893			10,081
Accrued liabilities - related parties		8,200			11,400
Interest payable		484,264			260,534
Interest payable to related parties		-			172,149
Notes payable		54,100			19,100
Convertible notes, net of discounts		1,265,842			961,404
Convertible notes to related parties, net of discounts		-			374,102
Derivative liabilities		5,215,301			3,294,816
Total current liabilities		7,229,374			5,302,542
Total liabilities		7,229,374			5,302,542

Stockholders' deficit
Preferred stock - Class A - 30,000,000 shares authorized, $0.001 par value, 14,000 shares issued and outstanding		14			14
Common stock - 2,500,000,000 shares authorized, $0.001 par value, 1,375,421,798 and 678,796,778 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively		1,375,422			678,797
Additional paid in capital		1,586,327			2,121,827
Accumulated deficit		(10,026,446	)		(7,873,675	)
Total stockholders' deficit		(7,064,683	)		(5,073,037	)
Total liabilities and stockholders' deficit	$	164,691		$	229,505

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

Table of Contents

ACCREDITED SOLUTIONS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	For the Three Months Ended						For the Six Months Ended
	June 30, 2024			June 30, 2023			June 30, 2024			June 30, 2023
Net sales	$	102,328		$	222,363		$	211,701		$	378,601
Cost of sales		53,766			163,040			173,057			293,030
Gross profit		48,562			59,323			38,644			85,571

Operating expenses
General and administrative expenses		61,084			3,071			117,100			76,536
Depreciation and amortization expense		2,893			8,251			5,787			16,489
Total operating expenses		63,977			11,322			122,887			93,025
Operating profit (loss)		(15,415	)		48,001			(84,243	)		(7,454	)

Other income (expense)
Change in derivative liabilities		(2,040,403	)		(1,507,718	)		(1,920,485	)		(1,539,976	)
Interest expense		(23,647	)		(46,855	)		(148,043	)		(95,195	)
Loss on extinguishment of debt		-			(2,374	)		-			(62,694	)
Gain on investment in subsidiaries		-			133,170			-			133,170
Total other income (expense)		(2,064,050	)		(1,423,777	)		(2,068,528	)		(1,564,695	)
Net loss from continuing operations		(2,079,465	)		(1,375,776	)		(2,152,771	)		(1,572,149	)
Net loss from discontinued operations		-			(162,173	)		-			(197,251	)
Net loss	$	(2,079,465	)	$	(1,537,949	)	$	(2,152,771	)	$	(1,769,400	)

Net loss per share from continuing operations - basic and diluted	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Net loss per share from discontinued operations - basic and diluted	$	-		$	(0.00	)	$	-		$	(0.00	)
Net loss per share - basic and diluted	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)

Weighted average number of common shares - basic and diluted		1,372,554,511			668,201,767			1,211,267,719			570,616,861

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

Table of Contents

ACCREDITED SOLUTIONS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT

(Unaudited)

	Preferred Stock				Common Stock				Additional			Accumulated
	Shares		Amount		Shares		Amount		Paid-in Capital			Deficit			Total
Balance, December 31, 2023		14,000	$	14		678,796,778	$	678,797	$	2,121,827		$	(7,873,675	)	$	(5,073,037	)
Issuance of common stock for conversion of note payable		-		-		631,394,251		631,394		(478,749	)		-			152,645
Net income for the period		-		-		-		-		-			(73,306	)		(73,306	)
Balance, March 31, 2024		14,000		14		1,310,191,029		1,310,191		1,643,078			(7,946,981	)		(4,993,698	)
Issuance of common stock for conversion of note payable		-		-		65,230,769		65,231		(56,751	)		-			8,480
Net loss for the period		-		-		-		-		-			(2,079,465	)		(2,079,465	)
Balance, June 30, 2024		14,000	$	14		1,375,421,798	$	1,375,422	$	1,586,327		$	(10,026,446	)	$	(7,064,683	)

	Preferred Stock				Common Stock						Additional			Accumulated
	Shares		Amount		Shares			Amount			Paid-in Capital			Deficit			Total
Balance, December 31, 2022		14,000	$	14		339,277,449		$	339,277		$	2,170,342		$	(6,385,080	)	$	(3,875,447	)
Issuance of common stock for conversion of note payable		-		-		262,469,031			262,469			(69,583	)		-			192,886
Issuance of common stock for services		-		-		20,000,000			20,000			(2,000	)		-			18,000
Net loss for the period		-		-		-			-			-			(231,451	)		(231,451	)
Balance, March 31, 2023		14,000		14		621,746,480			621,746			2,098,759			(6,616,531	)		(3,896,012	)
Issuance of common stock for conversion of note payable		-		-		62,050,298			62,051			(40,408	)		-			21,643
Issuance of common stock for services		-		-		(20,000,000	)		(20,000	)		2,000			-			(18,000	)
Issuance of common stock for sponsorship agreement		-		-		15,000,000			15,000			(9,000	)		-			6,000
Net loss for the period		-		-		-			-			-			(1,537,949	)		(1,537,949	)
Balance, June 30, 2023		14,000	$	14		678,796,778		$	678,797		$	2,051,351		$	(8,154,480	)	$	(5,424,318	)

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

Table of Contents

ACCREDITED SOLUTIONS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Six Months Ended
	June 30, 2024			June 30, 2023
Cash flows from operating activities:
Net loss	$	(2,152,771	)	$	(1,769,400	)
Net loss from discontinued operations		-			197,251
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		5,787			16,489
Stock issued for services		-			6,000
Loss on extinguishment of debt		-			62,694
Amortization of debt discount		986			-
Gain on investment of subsidiary		-			(133,170	)
(Gain) loss on derivative liabilities		1,920,485			1,539,976
Changes in operating assets and liabilities:
Accounts receivable		64,109			13,210
Prepaid expenses		2,072			2,108
Accounts payable		(13,533	)		(33,535	)
Accounts payable to related parties		(3,200	)		-
Accrued liabilities		(7,482	)		(2,813	)
Interest payable		319,206			77,839
Interest payable to related parties		(172,149	)		17,356
Operating cash flows from discontinued operations		-			(37,487	)
Net cash used in operating activities		(36,490	)		(43,482	)

Cash flows from investing activities:
Investing activities of discontinued operations		-			(541	)
Net cash flows from investing activities		-			(541	)

Cash flows from financing activities:
Proceeds from notes payable, net of discounts		30,000			-
Proceeds from advances from related parties		12,350			14,100
Financing activities of discontinued operations		-			5,500
Net cash provided by financing activities		42,350			19,600

Net change in cash		5,860			(24,423	)
Cash and cash equivalents - beginning of period		919			35,968
Cash and cash equivalents - end of period		6,779			11,545
Cash and cash equivalents of discontinued operations		-			-
Cash and cash equivalents of continuing operations	$	6,779		$	11,545

Supplemental disclosures of cash flow information:
Cash paid for interest	$	-		$	-
Cash paid for income taxes	$	-		$	-

Supplemental non-cash information
Intangible assets sold for reduction of convertible note - related parties	$	-		$	5,000
Conversion of notes payable into common stock	$	161,125		$	151,836

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

Table of Contents

ACCREDITED SOLUTIONS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2024

(Unaudited)

NOTE 1 – NATURE OF OPERATIONS

Accredited Solutions, Inc. (the “Company” or “Accredited”), formerly known as Keyser Resources, Inc., Lone Star Gold, Inc. and Good Hemp, Inc., was incorporated in the State of Nevada on November 26, 2007.

On April 1, 2021, the Company entered into an agreement to purchase Diamond Creek Group, LLC, a North Carolina limited liability company which sells the Diamond Creek brand of high alkaline water products, for a total purchase price of $643,000. On April 2, 2021, the Company closed the acquisition and paid the initial $500,000 portion of the purchase price, and on April 23, 2021, paid the $143,000 purchase price balance.

Effective May 11, 2022, the Company completed a Plan and Agreement of Merger (the “PXS Merger Agreement”) with Petro X Solutions, Inc., a Wyoming corporation (“PXS”), with PXS becoming our wholly-owned subsidiary as a result of the PXS Merger. Pursuant to the PXS Merger Agreement, as amended, an aggregate of 120,000,000 shares of Company common stock were issued to the shareholders of PXS in the PXS Merger. PXS markets competitively-priced, environmentally-friendly products that are designed to work as well as or better than their toxic competitors.

PXS is being treated as discontinued operations in the consolidated financial statements.

The Company’s operations are centered on those of Diamond Creek Group and its bottled water products.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company follows the accrual basis of accounting in accordance with generally accepted accounting principles in the United States of America and has a year-end of December 31^st.

Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company’s system of internal accounting control is designed to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Accredited Solutions, Inc., its wholly-owned subsidiary, Diamond Creek Group, LLC, and its former subsidiary Petro X Solutions, Inc. (collectively, the “Company”). All intercompany accounts have been eliminated upon consolidation.

Condensed Financial Statements

The unaudited condensed financial statements of the Company for the three and six month periods ended June 30, 2024 and 2023, have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Regulation S-K. Accordingly, they do not include all the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year. The balance sheet information as of December 31, 2023, was derived from the audited financial statements included in the Company’s financial statements as of and for the year ended December 31, 2023, included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission. These unaudited condensed financial statements should be read in conjunction with that report.

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Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the recoverability of long-lived assets and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

Impairment of Long-Lived Assets

Long-lived assets and certain identifiable intangible assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Measurement of an impairment loss for long-lived assets and certain identifiable intangible assets that management expects to hold and use is based on the fair value of the asset. Long-lived assets and certain identifiable intangible assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.

Goodwill and Other Intangible Assets

Goodwill and indefinite-lived intangible assets are not amortized, but are evaluated for impairment annually or when indicators of a potential impairment are present. Our impairment testing of goodwill is performed separately from our impairment testing of indefinite-lived intangibles. The annual evaluation for impairment of goodwill and indefinite-lived intangibles is based on valuation models that incorporate assumptions and internal projections of expected future cash flows and operating plans. We believe such assumptions are also comparable to those that would be used by other marketplace participants. We evaluate a number of factors to determine whether an indefinite life is appropriate, including the competitive environment, market share, brand history, product life cycles, operating plans and the macroeconomic environment of the countries in which the brands are sold. When certain events or changes in operating conditions occur, an impairment assessment is performed and indefinite-lived brands may be adjusted to a determinable life. The cost of intangible assets with determinable useful lives is amortized to reflect the pattern of economic benefits consumed, either on a straight-line or accelerated basis over the estimated periods benefited. Patents, technology and other intangibles with contractual terms are generally amortized over their respective legal or contractual lives. Customer relationships, brands and other non-contractual intangible assets with determinable lives are amortized over periods generally ranging from 5 to 30 years. When certain events or changes in operating conditions occur, an impairment assessment is performed and lives of intangible assets with determinable lives may be adjusted.

Fair Value of Financial Instruments

The FASB issued ASC 820-10, Fair Value Measurements and Disclosures, for financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. ASC 820-10 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The following summarizes the three levels of inputs required by the standard that the Company uses to measure fair value:

- Level 1: Quoted prices in active markets for identical assets or liabilities

- Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities.

- Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Determining which category an asset or liability falls within the hierarchy requires significant judgment. We evaluate our hierarchy disclosures each quarter.

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Cash and Cash Equivalents

For purposes of the statement of cash flows, cash equivalents include demand deposits, money market funds, and all highly liquid debt instructions with original maturities of three months or less.

The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.

Inventory

Inventory consisting of raw materials and finished product is stated at the lower of cost (first in, first out method) or net realizable value.

Concentration and Credit Risk

The Company does not have any financial asset and therefore is not exposed to any credit risks.

Cash - The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.

Accounts Receivable and Allowance for Doubtful Accounts

Trade accounts receivable consists of product sales to customers. Trade accounts receivable are generally due 30 days after issuance of the invoice. Receivables past due more than 120 days are considered delinquent. Delinquent receivables are written off based on specific circumstances of the customer. At June 30, 2024, an allowance was not deemed necessary.

Derivative Financial Instruments

For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, the Company used a Black Scholes valuation model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date.

Commitment and Contingencies

The Company follows ASC 450-20, Loss Contingencies, to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.

The Company follows ASC 440-10, Commitments, to report accounting for certain commitments.

Net Loss Per Common Share

The Company computes net income or loss per share in accordance with ASC 260 Earnings per Share. Under the provisions of the Earnings per Share Topic ASC, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is anti-dilutive.

Income Taxes

The Company accounts for its income taxes in accordance with ASC 740 Income Taxes, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is provided for the amount of deferred tax assets that would otherwise be recorded for income tax benefits primarily relating to operating loss carryforwards as realization cannot be determined to be more likely than not.

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The statement establishes a more-likely-than-not threshold for recognizing the benefits of tax return positions in the financial statements. Also, the statement implements a process for measuring those tax positions which meet the recognition threshold of being ultimately sustained upon examination by the taxing authorities. There are no uncertain tax positions taken by the Company on its tax returns and the adoption of the statement had no material impact to the Company’s financial statements. The Company files tax returns in the US and states in which it has operations and is subject to taxation. Tax years subsequent to 2019 remain open to examination by U.S. federal and state tax jurisdictions.

Revenue Recognition

Revenue is recognized in accordance with ASC 606. The Company performs the following five steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company applies the five-step model to arrangements that meet the definition of a contract under Topic 606, including when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, the Company evaluates the goods or services promised within each contract related performance obligation and assesses whether each promised good or service is distinct. The Company recognizes as revenue, the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The Company recognizes revenue upon completion of our performance obligations or expiration of the contractual time to use services such as professional service hours purchased in bulk for a given time period.

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by FASB that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption.

NOTE 3 – GOING CONCERN

The Company’s unaudited condensed consolidated financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has recurring operating losses, an accumulated deficit and a working capital deficiency. Management’s plans include raising capital in the debt and equity markets. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until its operations become established enough to be considered reliably profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As reflected in the financial statements, the Company had a working capital deficit of $7,219,468 at June 30, 2024, and used $36,490 in cash for operating activities for the six months ended June 30, 2024, which raises substantial doubt as to the Company’s ability to continue as a going concern in the future.

The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company is unable to continue as a going concern.

NOTE 4 – ACQUISITION OF PETRO X SOLTUIONS, INC.

Effective May 11, 2022, the Company consummated a plan and agreement of merger (the “Merger Agreement”) with Petro X Solutions, Inc., a Wyoming corporation (“PXS”), pursuant to which PXS became a wholly-owned subsidiary of the Company. Pursuant to the Merger Agreement, the Company issued 100,000,000 shares of its common stock to the shareholders of PXS and four persons were added to the Company’s Board of Directors. Pursuant to the Merger Agreement, the Company’s four new directors were issued a total of 81,083,333 shares of Company common stock. Thus, a change in control of the Company occurred in connection with the Merger Agreement.

Due to the effects of the “reverse merger” acquisition of PXS occurring effective May 11, 2022, in accordance with ASC 805 Business Combinations, the presentation of the financial statements represents the continuation of PXS, the accounting acquirer, except for the legal capital structure. Historical shareholders’ equity of the Company, the accounting acquiree, has been adjusted to reflect the recapitalization. Retained earnings (deficit) of PXS, the accounting acquirer have been carried forward after the acquisition and operations prior to the merger are those of PXS, the accounting acquirer. Earnings per share for periods prior to the merger have been adjusted to reflect the recapitalization.

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Accordingly, (1) the Company’s Consolidated Balance Sheet as of June 30, 2024, and December 31, 2023, report PXS as discontinued operations, (2) the Company’s Consolidated Statement of Changes in Stockholders’ Equity (Deficit) for March 31, 2023, reflects the adjustment for the rescission of the PXS merger and (3) the Company’s Consolidated Statement of Operations and Consolidated Statement of Cash Flows for the three and six months ended June 30, 2024 and 2023, reports PXS as discontinued operations.

NOTE 5 – RESCISSION OF ACQUISITION OF PETRO X SOLUTIONS, INC.

Effective May 11, 2022, the Company completed a Plan and Agreement of Merger (the Merger Agreement) with PXS, with PXS becoming the Company’s wholly-owned subsidiary as a result of the PXS Merger. Pursuant to the Merger Agreement, an aggregate of 100,000,000 shares of Company common stock were issued to the shareholders of PXS in the PXS Merger. PXS markets competitively-priced, environmentally-friendly products that are designed to work as well as or better than their toxic competitors.

Effective June 1, 2023, the PXS Merger was rescinded, such that all securities issued by the Company in connection with the PXS Merger were cancelled and the ownership of PXS returned to its prior owners. PXS is being treated as discontinued operations in the consolidated financial statements.

NOTE 6 – NOTES PAYABLE

On March 26, 2021, the Company entered into a securities purchase agreement with Leonite Capital LLC (“Leonite”) pursuant to which the Company agreed to issue to the Investor an 8% Convertible Promissory Note, dated March 26, 2021, in the principal amount of $568,182. The note was funded by the Investor on March 26, 2021, and on such date pursuant to the securities purchase agreement, the Company reimbursed the Investor for expenses for legal fees and due diligence of $2,000. The securities purchase agreement includes customary representations, warranties and covenants by the Company and customary closing conditions. The note matures 12 months after the date of the note on March 26, 2022. The note is convertible into shares of the Company’s common stock beginning on the date which is 180 days from the date of the note, at a conversion price equal to 65% multiplied by the lowest closing bid price during the 20 trading day period ending on the last complete trading day prior to the date of conversion; provided, however, that the Investor may not convert the note to the extent that such conversion would result in the Investor’s beneficial ownership of the Company’s common stock being in excess of 4.99% of the Company’s issued and outstanding common stock. The beneficial ownership limitation may not be waived by the Investor. The note carries a prepayment penalty if the note is paid off in 30, 60, 90, 120, 150, or 180 days following the note date. The prepayment penalty is based on the then-outstanding principal at the time of payoff, plus accrued and unpaid interest, multiplied by 112%, 115%, 118%, 125%, 130%, and 135% respectively. After the expiration of 180 days following the issue date, the Company shall have no right of prepayment. The financing required the Company to issue 65,000 shares of common stock to Leonite. This note is in default so default interest of 24.0% is in place along with penalties. At June 30, 2024, the balance owed to Leonite was $728,232 and accrued interest and penalties was $172,545.

On May 4, 2021, the Company entered into a securities purchase agreement with Metrospaces, Inc., a Florida corporation, pursuant to which the Company agreed to issue to the investor a 5% Convertible Redeemable Note, dated April 4, 2021, in the principal amount of $50,000. The note was funded by the investor on May 4, 2021, with the Company receiving funding of $50,000. The securities purchase agreement includes customary representations, warranties and covenants by the Company and customary closing conditions. The note matures 12 months after the date of the note on May 4, 2022. The note is convertible into shares of the Company’s common stock at any time at a conversion price equal to 65% multiplied by the lowest closing price during the 20 trading day period prior to the date of conversion (and including the conversion date); provided, however, that the investor may not convert the note to the extent that such conversion would result in the investor’s beneficial ownership of the Company’s common stock being in excess of 9.9% of the Company’s issued and outstanding common stock. The note carries a prepayment penalty if it is paid off in 180 days following the note date. The prepayment penalty is based on the then-outstanding principal at the time of payoff, plus accrued and unpaid interest, multiplied by 115% if prepaid within 60 days, 120% if prepaid from 61 days-120 days, and 125% if prepaid between 121 days-180 days of issuance. After the expiration of 180 days, the Company shall have no right of prepayment. This note is in default so default interest of 24.0% is in place. At June 30, 2024, the balance owed to Metrospace was $31,950 and accrued interest was $63,787.

On October 5, 2021, the Company entered into a securities purchase agreement (the “Jefferson SPA”) with Jefferson Street Capital, LLC, a New Jersey limited liability company, pursuant to which the Company agreed to issue to the investor a 10% Convertible Redeemable Promissory Note (the “Jefferson Note”), dated October 5, 2021, in the principal amount of $275,000. The Jefferson Note included a $25,000 original issue discount, and was funded by the investor on October 13, 2021, and on such date pursuant to the Jefferson Note, the Company reimbursed the investor for loan fees of $20,000, receiving net funding of $230,000. The Jefferson SPA includes customary representations, warranties and covenants by the Company and customary closing conditions. The Jefferson Note matures on August 20, 2022. The note is convertible into shares of the Company’s common stock at any time at a conversion price equal to 75% multiplied by the lowest closing bid price during the 10 trading day period prior to the date of conversion (and including the conversion date); provided, however, that the investor may not convert the note to the extent that such conversion would result in the investor’s beneficial ownership of the Company’s common stock being in excess of 4.99% of the Company’s issued and outstanding common stock. This note is in default so default interest of 24.0% is in place along with penalties. At June 30, 2024, the balance owed to Jefferson Street was $123,572 and accrued interest was $47,164.

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On March 8, 2022, the Company amended and restated a convertible promissory note with Mr. Chumas. The original note was entered into on July 22, 2019 for $100,000. The amendment set the interest rate at 10.0% with the due date of October 31, 2022. The conversion price is the lower of (i) $0.001 (the “Fixed Conversion Price”) or, (ii) 50% of the lowest bid price during the forty-five (45) consecutive trading day period ending on the trading day immediately prior to the applicable conversion date. The note is in default. As of June 30, 2024, the balance of the note is $100,000 and accrued interest is $55,476.

On March 8, 2022, the Company amended and restated a convertible promissory note with JanBella Group, LLC. The original note was entered into on July 17, 2019 for $110,000. The amendment set the interest rate at 10.0% with the due date of October 31, 2022. The conversion price is the lower of (i) $0.001 (the “Fixed Conversion Price”) or, (ii) 50% of the lowest bid price during the forty-five (45) consecutive trading day period ending on the trading day immediately prior to the applicable conversion date. During the fiscal year ended December 31, 2023, JanBella converted $15,598 of the principal balance into the Company’s shares of common stock. The note is in default. As of June 30, 2024, the balance of the note is $94,402 and accrued interest is $54,548.

On March 8, 2022, the Company amended and restated a convertible promissory note with Mr. Alessi. The original note was entered into on July 22, 2021 for $200,000. The amendment set the interest rate at 10.0% with the due date of October 31, 2022. The conversion price is the lower of (i) $0.001 (the “Fixed Conversion Price”) or, (ii) 50% of the lowest bid price during the forty-five (45) consecutive trading day period ending on the trading day immediately prior to the applicable conversion date. During the fiscal year ended December 31, 2023, Mr. Alessi converted $20,300 of the principal balance into the Company’s shares of common stock. The note is in default. As of June 30, 2024, the balance of the note is $179,700 and accrued interest is $82,569.

On July 27, 2022, the Company entered into a securities purchase agreement (the “SPA”) with 1800 Diagonal Lending LLC, a Virginia limited partnership (“1800 Diagonal”), pursuant to which the Company agreed to issue to 1800 Diagonal a 9% Promissory Note (the “Note”), dated July 27, 2022, in the principal amount of $129,250. The Note was funded by 1800 Diagonal on August 1, 2022, with the Company receiving funding of $125,000, net of legal fees of $3,000 and a due diligence fee of $1,250. The SPA includes customary representations, warranties and covenants by the Company and customary closing conditions. The Note matures 12 months after the date of the note on July 27, 2023. The Company has the right to repay the Note at a premium ranging from 115% to 125% of the face amount. After the 180th day following July 27, 2022, the Company has no right of repayment. The Note is convertible into shares of the Company’s common stock at a conversion price equal to 65% of the market price of the Company’s common stock on the date of conversion, any time after the date that is 180 days after July 27, 2022; provided, however, that 1800 Diagonal may not convert the Note to the extent that such conversion would result in the investor’s beneficial ownership of the Company’s common stock being in excess of 4.99% of the Company’s then-issued and outstanding common stock. At June 30, 2024, the balance owed to 1800 Diagonal was $0 and accrued interest was $0.

One October 25, 2023, the Company entered into a securities purchase agreement (the “SPA”) with 1800 Diagonal Lending LLC, a Virginia limited partnership (“1800 Diagonal”), pursuant to which the Company agreed to issue to 1800 Diagonal a 9% Promissory Note (the “Note”), dated October 25, 2023, in the principal amount of $12,000. The Note was funded by 1800 Diagonal on October 25, 2023, with the Company receiving funding of $12,000. The SPA includes customary representations, warranties and covenants by the Company and customary closing conditions. The Note matures 12 months after the date of the note on October 25, 2024. The Company has the right to repay the Note at a premium ranging from 115% to 125% of the face amount. After the 180th day following October 25, 2023, the Company has no right of repayment. The Note is convertible into shares of the Company’s common stock at a conversion price equal to 61% of the market price of the Company’s common stock on the date of conversion, any time after the date that is 180 days after October 25, 2023; provided, however, that 1800 Diagonal may not convert the Note to the extent that such conversion would result in the investor’s beneficial ownership of the Company’s common stock being in excess of 4.99% of the Company’s then-issued and outstanding common stock. As of June 30, 2024, the outstanding balance of this note was $12,000 and accrued interest was $737.

On April 19, 2024, the Company entered into a securities purchase agreement (the “Jefferson”) with Jefferson Street Capital, LLC, a New Jersey limited liability company, pursuant to which the Company agreed to issue to the investor a 18% Promissory Note (the “Jefferson Note”), dated April 19, 2024, in the principal amount of $10,000. The Jefferson includes customary representations, warranties and covenants by the Company and customary closing conditions. The Jefferson Note matured on April 19, 2024 and is now in default. At June 30, 2024, the balance owed to Jefferson Street was $10,000 and accrued interest was $355.

On April 19, 2024, the Company entered into a securities purchase agreement with Leonite Capital LLC (“Leonite”) pursuant to which the Company agreed to issue to the Investor an 18% Promissory Note, dated April 19, 2024, in the principal amount of $25,000. The note was funded by the Investor on April 19, 2024, and on such date pursuant to the securities purchase agreement, the Company reimbursed the Investor for expenses for legal fees and due diligence of $5,000. The securities purchase agreement includes customary representations, warranties and covenants by the Company and customary closing conditions. The note matures 12 months after the date of the note on April 19, 2025. At June 30, 2024, the balance owed to Leonite was $25,000 and accrued interest was $888.

NOTE 7 – RELATED PARTY TRANSACTIONS

In February 2023 through June 2023, a former officer and director of the Company, Eric Newlan (then an officer and director of the Company) made advances on behalf of the Company in the total amount of $14,100, which amounts were used to pay operating expenses of the Company. The amounts loaned by Mr. Newlan are due on demand and bear no interest.

From July 2023 through December 2023, Mr. Allessi, while the Company’s controlling shareholder, made advances on behalf of the Company in the total amount of $15,350, which amounts were used to pay operating expenses of the Company. The amounts loaned by Mr. Alessi are due on demand and bear no interest. Based on the transaction noted above, Mr. Alessi is no longer a related party.

During the six months ended June 30, 2024, an officer and director of the Company, Eduardo Brito, made advances on behalf of the Company in the total amount of $12,350, which amounts were used to pay operating expenses of the Company. The amounts loaned by Mr. Brito are due on demand and bear no interest.

NOTE 8 – DERIVATIVE LIABILITIES

The Company analyzed the conversion option for derivative accounting consideration under ASC 815, Derivatives and Hedging and determined that the instrument should be classified as a liability since the conversion option becomes effective at issuance resulting in there being no explicit limit to the number of shares to be delivered upon settlement of the above conversion options. The Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Binomial pricing model to calculate the fair value as of June 30, 2024. The Binomial model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each convertible note is estimated using the Binomial valuation model.

For the six months ended June 30, 2024, the assumptions utilized in estimating fair values of the liabilities measured on a recurring basis are as follows:

	Six months ended
	June 30, 2024
Expected term	0.09 years
Expected average volatility		199.31	%
Expected dividend yield		-
Risk-free interest rate		5.47	%

The fair value measurements of the derivative liabilities at June 30, 2024, are summarized:

Total				Level 1				Level 2				Level 3
$	5,215,301			$	-			$	-			$	5,215,301

The fair value measurements of the derivative liabilities at December 31, 2023, is summarized:

Total				Level 1				Level 2				Level 3
$	3,294,816			$	-			$	-			$	3,294,816

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NOTE 9 – COMMITMENTS AND CONTINGENCIES

Legal Matters

The Company is subject, from time to time, to claims by third parties under various legal disputes. The defense of such claims, or any adverse outcome relating to any such claims, could have a material adverse effect on the Company’s liquidity, financial condition and cash flows. As of August 22, 2024, the Company did not have any legal actions pending against it.

Commitments

None

NOTE 10 – CAPITAL STOCK

During the six months ended June 30, 2024, the Company issued 566,163,482 shares of common stock to 1800 Diagonal Lending, LLC for conversion of $152,645 in convertible debt.

On March 14, 2024, the Company issued 65,230,769 shares of common stock to Metrospaces for conversion of $8,480 in accrued interest on convertible debt.

On April 4, 2024, the Company issued 65,230,769 shares of common stock to Metrospaces for conversion of $8,480 in accrued interest on convertible debt.

NOTE 11 – DISCONTINUED OPERATIONS

In May 2023, the Company decided to discontinue operations of its subsidiary, Petro X Solutions (PXS). Effective June 1, 2023, the PXS acquisition was rescinded and it ceased being a subsidiary of the Company.

In accordance with the provisions of ASC 205-20, the Company reported no assets and liabilities of the discontinued operations (held for sale) in the consolidated balance sheets for June 30, 2024 and December 31, 2023.

In accordance with the provisions of ASC 205-20, the Company has not included in the results of continuing operations the results of operations of the discontinued operations in the Consolidated Statements of Operations. The results of operations for this entity for the three and six months ended June 30, 2024 and 2023, have been reflected as discontinued operations in the Consolidated Statements of Operations, and consist of the following:

	Three Months Ended
	June 30, 2024		June 30, 2023
Net sales	$	-	$	-
Cost of sales		-		1,774
Gross profit		-		(1,774	)

OPERATING EXPENSES OF DISCONTINUED OPERATIONS:
General and administrative		-		160,399
		-		160,399
OPERATING INCOME (LOSS) OF DISCONTINUED OPERATIONS		-		(162,173	)

INCOME (LOSS) BEFORE INCOME TAXES OF DISCONTINUED OPERATIONS		-		(162,173	)
Provision for income taxes of discontinued operations		-		-
NET INCOME (LOSS) OF DISCONTINUED OPERATIONS	$	-	$	(162,173	)

	Six Months Ended
	June 30, 2024		June 30, 2023
Net sales	$	-	$	-
Cost of sales		-		5,038
Gross profit		-		(5,038	)

OPERATING EXPENSES OF DISCONTINUED OPERATIONS:
General and administrative		-		192,213
		-		192,213
OPERATING INCOME (LOSS) OF DISCONTINUED OPERATIONS		-		(197,251	)

INCOME (LOSS) BEFORE INCOME TAXES OF DISCONTINUED OPERATIONS		-		(197,251	)
Provision for income taxes of discontinued operations		-		-
NET INCOME (LOSS) OF DISCONTINUED OPERATIONS	$	-	$	(197,251	)

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In accordance with the provisions of ASC 205-20, the Company has separately reported the cash flow activity of the discontinued operations in the Consolidated Statements of Cash Flows. The cash flow activity from discontinued operations for the six months ended June 30, 2024 and 2023, have been reflected as discontinued operations in the Consolidated Statements of Cash Flows and consist of the following:

	Six Months Ended
	June 30, 2024			June 30, 2023
DISCONTINUED OPERATING ACTIVITIES
Net loss	$	(197,251	)	$	(35,078	)
Prepaid expenses and other current assets		225,390			2,616
Accounts payable and accrued liabilities		(65,626	)		987
Net cash provided by operating activities of discontinued operations	$	(37,487	)	$	(31,475	)

INVESTING ACTIVITIES OF DISCONTINUED OPERATIONS
Net cash held in discontinued operations	$	(541	)	$	5,500
Net cash used in investing activities of discontinued operations	$	(541	)	$	5,500

FINANCING ACTIVITIES OF DISCONTINUED OPERATIONS
Proceeds from related party advances	$	5,500		$	5,500
Net cash used in financing activities of discontinued operations	$	5,500		$	5,500

NOTE 12 – SUBSEQUENT EVENTS

Management has evaluated subsequent events, in accordance with FASB ASC Topic 855, “Subsequent Events,” through the date which the financial statements were available to be issued and there are no material subsequent events, except as noted below.

On July 16, 2024, the Company issued 68,600,000 shares of common stock to 1800 Diagonal Lending, LLC for the conversion of $8,232 in principal and accrued interest.

On July 18, 2024, the Company issued 68,600,000 shares of common stock to 1800 Diagonal Lending, LLC for the conversion of $8,232 in principal and accrued interest.

On July 19, 2024, the Company issued 22,350,667 shares of common stock to 1800 Diagonal Lending, LLC for the conversion of $2,682 in principal and accrued interest.

On July 23, 2024, the Company issued 76,590,000 shares of common stock to JanBella Group (a non-affiliate at the time of the transaction) for conversion of $7,659 in accrued interest on convertible debt.

On July 25, 2024, the Company issued 68,633,548 shares of common stock to Leonite Capital, LLC for the conversion of $8,922 in principal and accrued interest.

On August 5, 2024, the Company issued 60,000,000 shares of common stock to Metrospaces for conversion of $7,800 in accrued interest on convertible debt.

On August 6, 2024, the Company issued 32,000,000 shares of common stock to JanBella Group (a non-affiliate at the time of the transaction) for conversion of $3,200 in accrued interest on convertible debt.

On August 7, 2024, the Company issued 39,849,850 shares of common stock to Leonite Capital, LLC for the conversion of $5,180 in principal and accrued interest.

On August 9, 2024, the Company issued 62,000,000 shares of common stock to Metrospaces for conversion of $8,060 in accrued interest on convertible debt.

On August 11, 2024, the Company issued 160,000,000 shares of common stock to Metrospaces for conversion of $20,800 in accrued interest on convertible debt.

On August 12, 2024, the Company issued 75,000,000 shares of common stock to Jefferson Street Capital, LLC for the conversion of $7,500 in principal and accrued interest.

Designation of Series B Preferred Stock

In August 2024, the Company filed with the State of Nevada a Certificate of Designation which established a Series B Convertible Preferred Stock (the “Series B Preferred Stock”).

Designation and Amount. 5,000 shares were designated as Series B Preferred Stock. The Series B Preferred Stock shall have an initial liquidation preference, or stated value, of $1,000 per share.

Voting. Series B Preferred Stock shall have no right to vote on any matters requiring shareholder approval.

Dividends. Series B Preferred Stock will carry an annual ten percent (10%) cumulative dividend, compounded daily, payable solely upon redemption, liquidation or conversion.

Conversion. The Series B Preferred Stock is convertible at any time at a conversion price equal 85% multiplied by the average of the three (3) lowest volume weighted average prices for the Company’s common stock during the five (5) Trading Day period ending on the latest trading day prior to the conversion date.

Exchange Agreements

Effective in August 2024, the Company entered into separate exchange agreements with six lenders (the “Lender Group”), pursuant to which the Lender Group exchanged a total of $1,100,000 of debt for a total of 1,217 shares of Series B Preferred Stock.

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

SPECIAL NOTE CONCERNING FORWARD-LOOKING STATEMENTS

We believe that it is important to communicate our future expectations to our security holders and to the public. This report, therefore, contains statements about future events and expectations which are “forward-looking statements” within the meaning of Sections 27A of the Securities Act of 1933 and 21E of the Securities Exchange Act of 1934, including the statements about our plans, objectives, expectations and prospects under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You can expect to identify these statements by forward-looking words such as “may,” “might,” “could,” “would,” “will,” “anticipate,” “believe,” “plan,” “estimate,” “project,” “expect,” “intend,” “seek” and other similar expressions. Any statement contained in this report that is not a statement of historical fact may be deemed to be a forward-looking statement. Although we believe that the plans, objectives, expectations and prospects reflected in or suggested by our forward-looking statements are reasonable, those statements involve risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements, and we can give no assurance that our plans, objectives, expectations and prospects will be achieved.

Important factors that might cause our actual results to differ materially from the results contemplated by the forward-looking statements are contained in the “Risk Factors” section of and elsewhere in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and in our subsequent filings with the Securities and Exchange Commission. The following discussion of our results of operations should be read together with our financial statements and related notes included elsewhere in this report.

Overview

On February 6, 2019, the Company acquired trademarks and intellectual property, which included all rights and trade secrets to the hemp-derived CBD-infused line of consumer beverages sold under the “Good Hemp” brand. On April 30, 2019, the Company acquired the “CANNA HEMP” and “CANNA” trademarks including all rights and trade secrets and related inventory.

On August 24, 2020, with an effective date of July 1, 2020, the Company entered into a joint venture agreement with Paul Hervey (“Hervey”), an individual, for the purpose of cultivating hemp on approximately 9 acres of farmland and in approximately 3,700 square feet of greenhouse space in North Carolina (referred to as “Olin Farms”). In October 2021, Olin Farms ceased operations, and the limited liability company joint venture entity was dissolved.

On February 9, 2021, the Company formed Good Hemp Wellness, LLC, a limited liability company formed under the laws of the State of North Carolina, to sell CBD products to customers through chiropractic offices. In October 2021, this company was dissolved in North Carolina, and it is being treated as discontinued operations in the consolidated financial statements. In February 2023, the Company sold all of its Good Hemp-related to JanBella Group, LLC, a company controlled by the Company’s current controlling shareholder, William Alessi (then, a third-party). In consideration of such assets, Mr. Alessi forgave $5,000 of indebtedness of the Company.

Effective May 11, 2022, the Company acquired, by merger, Petro X Solutions, Inc., a Wyoming corporation (“PXS”). In the transaction, the Company issued a total of 120,000,000 shares of its common stock. PXS markets competitively-priced, environmentally-friendly products that are designed to work as well as or better than their toxic competitors. Its primary product, EnviroXstreamTM, is a plant-based, non-toxic, safe, yet powerful, cleaner/degreaser technology that expedites the natural bio-degradation process of hydrocarbons and other compounds. EnviroXstreamTM is currently a California South Coast AQMD-Certified Clean Air Solvent, and in the past has been, an EPA-designated Safer Choice product. EnviroXstreamTM distinguishes itself by its efficacy, which is buttressed by its “green” credentials.

Effective June 1, 2023, the PXS acquisition was rescinded, such that all securities issued by the Company in connection with the PXS acquisition were cancelled and the ownership of PXS returned to its prior owners.

PXS is being treated as discontinued operations in the consolidated financial statements.

Current Plan of Business

Since the June 1, 2023, rescission of the PXS acquisition, the Company has re-focused its operating plans on expanding its Diamond Creek Water business. However, without additional capital, it is unlikely that such business will expand rapidly, if at all.

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Results of Operations

For the Three Months Ended June 30, 2024, compared to the three months ended June 30, 2023

Revenues

We had $102,328 and $222,363 of revenue for the three months ended June 30, 2024 and 2023, respectively. Revenue was lower in 2024 as a result of management focusing on revamping the operations and getting sales force and processes dialed in for future growth.

Cost of Sales

We had $53,766 and $163,040 of cost of sales and a gross profit of $48,562 and $59,323 for the three months ended June 30, 2024 and 2023, respectively.

Operating Expenses

Operating income (expenses) for the three months ended June 30, 2024 and 2023, were $63,977 and $11,322 respectively. The increase in operating expenses for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 is due primarily to increased payroll related expenses.

Net Loss

Net loss from continuing operations for the three months ended June 30, 2024 and 2023, was $2,079,465 and $1,375,776, respectively. Net loss from discontinued operations for the three months ended June 30, 2024 and 2023, was $0 and $162,173, respectively. Net loss for the three months ended June 30, 2024 and 2023, was $2,079,465 and $1,537,949, respectively.

For the Six Months Ended June 30, 2024, compared to the Six Months Ended June 30, 2023

Revenues

We had $211,701 and $378,601 of revenue for the six months ended June 30, 2024 and 2023, respectively. Revenue was lower in 2024 as a result of management focusing on revamping the operations and getting sales force and processes dialed in for future growth.

Cost of Sales

We had $173,057 and $293,030 of cost of sales and a gross profit of $38,644 and $85,571 for the six months ended June 30, 2024 and 2023, respectively.

Operating Expenses

Operating expenses for the six months ended June 30, 2024 and 2023, were $122,887 and $93,025, respectively. The increase in expenses for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 is due primarily to increased payroll related expenses.

Net Loss

Net loss from continuing operations for the six months ended June 30, 2024 and 2023, was $2,152,771 and $1,572,149, respectively. Net loss from discontinued operations for the six months ended June 30, 2024 and 2023, was $0 and $197,251, respectively. Net loss for the six months ended June 30, 2024 and 2023, was $2,152,771 and $1,769,400, respectively.

Liquidity and Capital Resources

We had cash used in operations of $36,490 the six months ended June 30, 2024, compared to $43,482 for the six months ended June 30, 2023.

We had cash used in investing activities of $0 and $541 for the six months ended June 30, 2024 and 2023, respectively.

We had cash provided by financing activities of $42,350 for the six months ended June 30, 2024, compared to cash provided by financing activities of $19,600 for the six months ended June 30, 2023.

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As of June 30, 2024, the Company had cash and cash equivalents of $6,779. We do not have sufficient resources to effectuate our business. We expect to incur a minimum of $100,000 in expenses during the next twelve months of operations. We estimate that these expenses will be comprised primarily of general expenses including overhead, inventory purchases, legal and accounting fees.

As of June 30, 2024, the Company has primarily been funded by the advances from related parties. As of June 30, 2024, related party advances of $12,350, related party notes totaled $374,102, net of discounts, and third-party notes totaled $945,840, net of discounts, respectively.

The Company does not know of any trends, demands, commitments, events or uncertainties that will result in, or that are reasonable likely to result in, our liquidity increasing or decreasing in any material way.

The Company does not know of any significant changes in expected sources and uses of cash.

The Company does not have any commitments or arrangements from any person to provide it with any equity capital.

Going Concern

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As reflected in the financial statements, the Company had a working capital deficit of $7,219,468 at June 30, 2024, a net loss of $2,152,771 for the six months ended June 30, 2024, and $36,490 of cash used in operating activities for the six months ended June 30, 2024, which raises substantial doubt as to the Company’s ability to continue as a going concern for a period of one year from the issuance of the interim financial statements.

Off Balance Sheet Arrangements

We currently have no off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make a number of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Such estimates and assumptions affect the reported amounts of revenues and expenses during the reporting period. We base our estimates on historical experiences and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions and conditions. We continue to monitor significant estimates made during the preparation of our financial statements. On an ongoing basis, we evaluate estimates and assumptions based upon historical experience and various other factors and circumstances. We believe our estimates and assumptions are reasonable in the circumstances; however, actual results may differ from these estimates under different future conditions.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

A smaller reporting company, as defined by Item 10 of Regulation S-K, is not required to provide the information required by this item.

Item 4. Control and Procedures.

Evaluation of Disclosure Controls and Procedures

The Securities and Exchange Commission defines the term “disclosure controls and procedures” to mean a company’s controls and other procedures of an issuer that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuer’s management, including its chief executive and chief financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. The Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified under the SEC’s rules and forms and that information required to be disclosed is accumulated and communicated to the chief executive and interim chief financial officer to allow timely decisions regarding disclosure.

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As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are not effective as of such date. The Chief Executive Officer and Chief Financial Officer have determined that the Company continues to have the following deficiencies which represent a material weakness:

	·	The Company does not have a majority of independent directors;
	·	Lack of in-house personnel with the technical knowledge to identify and address some of the reporting issues surrounding certain complex or non-routine transactions. With material, complex and non-routine transactions, management has and will continue to seek guidance from third-party experts and/or consultants to gain a thorough understanding of these transactions;
	·	Insufficient personnel resources within the accounting function to segregate the duties over financial transaction processing and reporting; and
	·	Insufficient written policies and procedures over accounting transaction processing and period end financial disclosure and reporting processes.
	·	To remediate our internal control weaknesses, management intends to implement the following measures: as funding permits, the Company will add sufficient accounting personnel to properly segregate duties and to effect a timely, accurate preparation of the financial statements; the Company will hire staff technically proficient at applying U.S. GAAP to financial transactions and reporting; and upon the hiring of additional accounting personnel, the Company will develop and maintain adequate written accounting policies and procedures.

The additional hiring is contingent upon the Company’s efforts to obtain additional funding through equity or debt and the results of its operations. Management hopes to secure funds in the coming fiscal year but provides no assurances that it will be able to do so.

Changes in Internal Control over Financial Reporting

During the fiscal quarter covered by this Quarterly Report, there has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

The Company’s management, including the CEO and CFO, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of the control system must reflect that there are resource constraints and that the benefits must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

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PART II

OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. Other than disclosed herein, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of our operations.

Item 1A. Risk Factors

Not required.

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

None that have not otherwise been disclosed.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

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Item 6. Exhibits

The following exhibits are filed with this Form 10-Q:

Exhibit		Description
31.1 *		Certification by the Principal Executive Officer
31.2 *		Certification by the Principal Accounting Officer
32.1 *		Certifications by the Principal Executive Officer
32.2 *		Certifications by the Principal Accounting Officer
101 INS **		Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
101 SCH **		Inline XBRL Taxonomy Extension Schema Document
101 CAL **		Inline XBRL Taxonomy Calculation Linkbase Document
101 DEF **		Inline XBRL Taxonomy Extension Definition Linkbase Document
101 LAB **		Inline XBRL Taxonomy Labels Linkbase Document
101 PRE **		Inline XBRL Taxonomy Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

*Filed herewith.

** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

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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.

	ACCREDITED SOLUTIONS, INC.

Date: August 22, 2024		/s/ Rodney Sperry
		Rodney Sperry
		Chief Financial Officer

Accredited Solutions, Inc. 10-Q