WEED, INC.

WEED, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024

(Audited)

Note 1 –Nature of Business and Significant Accounting Policies

Nature of Business

WEED, Inc. (the “Company”), (formerly United Mines, Inc.) was incorporated under the laws of the State of Arizona on August 20, 1999 (“Inception Date”) as Plae, Inc. to engage in the exploration of gold and silver mining properties. On November 26, 2014, the Company was renamed from United Mines, Inc. to WEED, Inc. and was repurposed to pursue a business involving the purchase of land, and building Commercial Grade “Cultivation Centers” to consult, assist, manage & lease to Licensed Dispensary owners and organic grow operators on a contract basis, with a concentration on the legal and medical marijuana sector. The Company’s plan is to become a True “Seed-to-Sale” company providing infrastructure, financial solutions and real estate options in this new emerging market. The Company, under United Mines, was formerly in the process of acquiring mineral properties or claims located in the State of Arizona, USA. The name was previously changed on February 18, 2005 to King Mines, Inc. and then subsequently changed to United Mines, Inc. on March 30, 2005. The Company trades on the OTC Pink Sheets under the stock symbol: BUDZ.

On April 20, 2017, the Company acquired Sangre AT, LLC, a Wyoming company doing business as Sangre AgroTech. (“Sangre”). Sangre is a plant genomic research and breeding company comprised of top-echelon scientists with extensive expertise in genomic sequencing, genetics-based breeding, plant tissue culture, and plant biochemistry, utilizing the most advanced sequencing and analytical technologies and proprietary bioinformatics data systems available. No work is being conducted now until further funds are available.

On May 2, 2022, the Company acquired Hempirical Genetics, LLC, a Arizona company.

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein.

The Company has a calendar year end for reporting purposes.

Basis of Presentation:

The accompanying consolidated balance sheet at December 31, 2024, has been derived from audited consolidated financial statements and the unaudited condensed consolidated financial statements as of December 31, 2024 and 2023 ( the “financial statements”), have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the audited consolidated financial statements and related footnotes. It is management’s opinion, however, that all material adjustments (consisting of normal recurring adjustments), have been made which are necessary for a fair financial statements presentation. The consolidated financial statements include all material adjustments (consisting of normal recurring accruals) necessary to make the consolidated financial statements not misleading as required by Regulation S-X, Rule 10-01. Interim result are not necessarily indicative of results for a full year.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the following entities, all of which are under common control and ownership:

(1) Sangre is a wholly-owned subsidiary of WEED, Inc.

(2) Sangre AT, LLC is doing business as Sangre AgroTech.

(3) Hempirical Genetics, LLC is a wholly-owned subsidiary of WEED, Inc.

Note 1 – Nature of Business and Significant Accounting Policies (continued)

Principles of Consolidation (continued)

The consolidated financial statements herein contain the operations of the wholly-owned subsidiary listed above. All significant inter-company transactions have been eliminated in the preparation of these financial statements. The parent company, WEED and subsidiaries will be collectively referred to herein as the “Company”, or “WEED”. The Company's headquarters are located in Tucson, Arizona and its operations are primarily within the United States, with minimal operations in Australia.

These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Fair Value of Financial Instruments

Under FASB ASC 820-10-05, the Financial Accounting Standards Board establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. This Statement reaffirms that fair value is the relevant measurement attribute. The adoption of this standard did not have a material effect on the Company’s financial statements as reflected herein. The carrying amounts of cash, prepaid expenses and accrued expenses reported on the balance sheet are estimated by management to approximate fair value primarily due to the short term nature of the instruments.

Impairment of Long-Lived Assets

Long-lived assets held and used by the Company are reviewed for possible impairment whenever events or circumstances indicate the carrying amount of an asset may not be recoverable or is impaired. Recoverability is assessed using undiscounted cash flows based upon historical results and current projections of earnings before interest and taxes. Impairment is measured using discounted cash flows of future operating results based upon a rate that corresponds to the cost of capital. Impairments are recognized in operating results to the extent that carrying value exceeds discounted cash flows of future operations.

Basic and Diluted Loss Per Share

The basic net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted net loss per common share is computed by dividing the net loss adjusted on an “as if converted” basis, by the weighted average number of common shares outstanding plus potential dilutive securities. For the periods presented, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

Stock-Based Compensation

Under FASB ASC 718-10-30-2, all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values.

Revenue Recognition

The Company is using the revenue recognition standard ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”, and using the cumulative effect (modified retrospective) approach. Modified retrospective adoption requires entities to apply the standard retrospectively to the most current period presented in the financial statements, requiring the cumulative effect of the retrospective application as an adjustment to the opening balance of retained earnings at the date of initial application. No cumulative-effect adjustment in retained earnings was recorded as the Company’s has no historical revenue. The impact of the adoption of the new standard was not material to the Company’s consolidated financial statements. The Company did not earn revenue during the periods ended December 31, 2024 and 2023. When the Company earns revenue, it will be recognized in accordance with FASB ASC 606 – Revenue from Contracts with Customers.

The primary change under the new guidance is the requirement to report the allowance for uncollectible accounts as a reduction in net revenue as opposed to bad debt expense, a component of operating expenses. The adoption of this guidance did not have an impact on our condensed consolidated financial statements, other than additional financial statement disclosures. The guidance requires increased disclosures, including qualitative and quantitative disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers.

The Company operates as one reportable segment.

Note 1 – Nature of Business and Significant Accounting Policies (continued)

Revenue Recognition (continued)

Sales on fixed price contracts are recorded when services are earned, the earnings process is complete or substantially complete, and the revenue is measurable and collectability is reasonably assured. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue from sales in which payment has been received, but the earnings process has not occurred. Sales have not yet commenced.

Advertising and Promotion

All costs associated with advertising and promoting products are expensed as incurred. The Company recognized$212 and$2,911 of advertising and promotion costs for years ended December 31, 2024 and 2023.

Asset Retirement Obligations

The Company acquired a gas well on February 23, 2023, with a cost of$41,400. We are required to record a liability for the present value of our asset retirement obligation (“ARO”) to plug and abandon inactive-non-producing wells, facilities, and equipment, and to restore the land at the end of oil production operations. As a result, we accrued the full value of the cost amounting to$35,800 for plug and abandon non-operating well on the consolidated balance sheet as of December 31, 2024 and 2023.

Foreign Currency Transactions

Expenses are translated at the exchange rates in effect at the date of the transaction. Foreign currency denominated payables are translated at the rates of exchange at the balance sheet date. The resulting transaction gains and losses are recorded in the statement of income in the period incurred.

Assets and liabilities of those operations are translated at exchange rates in effect at the balance sheet date. Income and expenses are translated using the exchange rates on the transaction date for the reporting period. Translation adjustments, if any, are reported as a separate component of accumulated other comprehensive income. Transaction gain (loss) on foreign currency exchange rate was$799 and$5,576 for the years ended December 31, 2024 and 2023. For all significant foreign operations, the functional currency is the local currency.

Recently Adopted Accounting Standards

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segments expenses. The amendments require that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. The other segment items category is the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss. The amendments improve financials reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities. The Company adopted ASU No. 2023-07for our fiscal year 2024 annual financial statements and interim financial statements thereafter and have applied this standard retrospectively for all period presented in the consolidated financial statements. See Note 13 for more details on the Company’s segment information.

Note 2 –Going Concern

As shown in the accompanying financial statements, the Company has no revenues, incurred net losses from operations resulting in an accumulated deficit of$84,903,279 and negative working capital of$769,481 at December 31, 2024. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management is actively pursuing new products and services to begin generating revenues. In addition, the Company is currently seeking additional sources of capital to fund short term operations. The Company, however, is dependent upon its ability to secure equity and/or debt financing and there are no assurances that the Company will be successful; therefore, without sufficient financing it would be unlikely for the Company to continue as a going concern.

The financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company’s ability to continue as a going concern. The financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

Note 3 –Related Party

Notes Payable

From time to time, the Company has received short term loans from officers and directors as disclosed in Note 7 below. The Company has a total of$423,328 and$133,073 of note payable on the consolidated balance sheet as of December 31, 2024 and December 31, 2023, respectively.

From January 2022 to March 31, 2022, the Company received$4,000 and$500,000 loans from Nicole Breen and Glenn Martin, respectively. The$500,000 loan from Glenn Martin was replaced the$300,000 loan. From January 2023 to March 31, 2023, the Company paid off the remaining balance of the loan from Nicole Breen that originally was$37,500. From April 2023 to June 30, 2023, the Company received$50,000 from Nicole Breen. From July 2023 to September 30, 2023, the company paid off Glenn Marten’s loan of$500,000 and Nicole Breen’s loan of$50,000. From July 2024 to September, 2024, the Company received$10,000 from Glenn Marten. From September 2024 to December 31, 2024, the Company received$300,000 from Glenn Marten and the company paid off Glenn Marten’s loan of$5,000.

On May 2, 2022, the Company acquired the Hempirical Genetics, LLC from Jeffrey Miller, and then Jeffrey Miller became the executive officer of WEED, Inc. Based on the agreement, the Company owed Jeffrey Miller$120,000 as of June 30, 2023.

On July 1, 2022, Patrick Brodnik signed executive employee agreement with the Company, and become one of the related parties since that. On various dates during the third quarter 2022, the Company received advance of$3,661 from Patrick Brodnik at no interest. From April 2024 to June 2024, the Company paid off the advance of$3,661.

Services

Nicole M. Breen receives$1,500 a week in cash compensation for her services rendered to the Company.

Glenn E. Martin receives$8,000 a month in cash compensation for his services rendered to the Company.

Accrued Compensation

A total of$202,750 and$182,500 of officer compensation was unpaid and outstanding at December 31, 2024 and December 31, 2023, respectively.

Note 4 –Fair Value of Financial Instruments

Under FASB ASC 820-10-5, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value.

The Company has certain financial instruments that must be measured under the new fair value standard. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows:

Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.

The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of December 31, 2024 and December 31, 2023, respectively:

Fair Value Measurements at December 31, 2023

Fair Value Measurements at December 31, 2024

The fair values of our related party debts are deemed to approximate book value and are considered Level 2 inputs as defined by ASC Topic 820-10-35.

There were no transfers of financial assets or liabilities between Level 1, Level 2 and Level 3 inputs for the year ended December 31, 2024 and 2023.

Note 5 –Property and Equipment

Property and equipment consist of the following at December 31, 2024 and December 31, 2023, respectively:

On July 24, 2023, the Company sold another La Veta property for$1,800,000 and$988,375 was record as gain on sale.

Depreciation expense totaled$19,986 and$49,791 for the years ended December 31, 2024 and 2023, respectively.

Note 6 –Intangible Assets

Intangibles

In accordance with FASB ASC 350, “Intangibles-Goodwill and Other”, the Company evaluates the recoverability of identifiable intangible assets whenever events or changes in circumstances indicate that an intangible asset’s carrying amount may not be recoverable. The impairment loss would be calculated as the amount by which the carrying value of the asset exceeds its fair value. The US and Europe trademarks were acquired for$40,000 and$50,000, respectively, for the year ended December 31, 2018. Trademarks are initially measured based on their fair value and amortized by 10 and 25 years.

Acquisition intangible assets arising out of the acquisition of Hempirical Genetics, LLC. That should, in accordance with GAAP, be classified as intangibles, include goodwill.

On December 31, 2024 and December 31, 2023, Intangibles consists of the following:

Amortization expense totaled$2,600 and$2,460 for the years ended December31, 2024 and 2023, respectively.

Note 7 –Notes Payable, Related Parties

Notes payable, related parties consist of the following at December 31, 2024 and December 31, 2023, respectively:

Note 7 – Notes Payable, Related Parties (continued)

The Company recorded interest expense in the amount of$5,070 and$45,274 for the years ended December 31, 2024 and 2023, respectively, including debt amortization expense of$10,255 and$14,545 and imputed interest expense in the amount of$1,200 and$21,494, respectively, during such periods related to notes payable, related parties.

Note 8 –Notes Payable

Note payable consist of the following at December 31, 2024 and December 31, 2023, respectively:

The Company recognized interest expense of$0 and$0 related to the note payables for the years ended December 31, 2024 and 2023, respectively.

Note 9 –Commitments and Contingencies

Operating Leases

We account for our lease under ASC 842. Under this guidance, arrangements meeting the definition of a lease are classified as operating and are recorded on the consolidated balance sheet as both a right of use asset and lease liability, calculated by discounting fixed lease payments over the lease term at the rate implicit in the lease. Lease liabilities are increased by interest and reduced by payments each period, and the right of use asset is amortized over the lease term.

The rate implicit in lease is not readily determinable, and we therefore use incremental borrowing rate to determine the present value of the lease payments. The incremental borrowing rate used to determine the initial value of right-of-use (“ROU”) assets and lease liabilities during the period ended December 31, 2024, was 5.0%.

In May, 2022, we entered into a lease agreement of a hemp drying facility in Huachuca City, Arizona for$1,200 per month. The lease term began May 2, 2022 and ends May 2, 2026. As of December 31, 2024, we had lease liability of$18,538, and ROU assets of$18,538.

Note 9 – Commitments and Contingencies (continued)

The Company may be subject to legal proceedings and claims arising from contracts or other matters from time to time in the ordinary course of business. Management is not aware of any pending or threatened litigation where the ultimate disposition or resolution could have a material adverse effect on its financial position, results of operations or liquidity.

Note 10 –Stockholders’ Equity

Preferred Stock

On December 5, 2014, the Company amended the Articles of Incorporation, pursuant to which 20,000,000 shares of “blank check” preferred stock with a par value of$0.001 were authorized. No series of preferred stock has been designated to date.

Common Stock

On December 5, 2014, the Company amended the Articles of Incorporation, and increased the authorized shares to 200,000,000 shares of$0.001 par value common stock.

2024 Common Stock Activity

Common Stock Sales (2024)

No stocks were issued during the year ended December 31, 2024.

Common Stock Issued for Services (2024)

During the quarter ended June 30, 2024,1,750,000 shares of common stocks valued at$315,000 were issued for the services, and such amount has been included in subscriptions payable.

During the quarter ended June 30, 2024, the Company agreed to issue an aggregate of 200,000 shares to consultants for services performed. The total fair value of common stock was$14,000 based on the closing price of the Company’s common stock earned on the measurement date.

Common Stock Cancellations

No common stocks were cancelled during the year ended December 31, 2024.

2023 Common Stock Activity

Common Stock Sales (2023)

No stocks were issued during the year ended December 31, 2023.

Common Stock Issued for Services (2023)

During the year ended December 31, 2023,600,000 shares of common stocks valued at$90,000 were not issued for the services, and such amount has been included in subscriptions payable.

Common Stock Cancellations

No common stocks were cancelled during the year ended December 31, 2023.

Note 10 – Stockholders’ Equity (Continued)

Common Stock Warrants and Options

2024 Common Stock Warrant Activity

Common Stock Warrants Granted (2024)

No common stock warrants were granted during the year ended December 31, 2024.

Warrants Exercised (2024)

No warrants were exercised during the year ended December 31, 2024.

2023 Common Stock Warrant Activity

Common Stock Warrants Granted (2023)

No common stock warrants were granted during the year ended December 31, 2023.

Warrants Exercised (2023)

No warrants were exercised during the year ended December 31, 2023.

The stock option will expire on the tenth anniversary of the granted date, which is February 1, 2028. As of December 31, 2024, the stock option will expire in 37 months.

A summary of the Company’s stock option activity and related information is as follows:

Note 11 –Other Income

During the year ended December 31, 2024, the Company received a$35,000 settlement from the Titan laboratory deal. This amount represents refunds from the prepaid rent of a purchase deal that fell through in 2023.

Note 12 –Income Tax

The Company accounts for income taxes under FASB ASC 740-10, which requires use of the liability method. FASB ASC 740-10-25 provided that deferred tax assets and liabilities, are recorded based on the differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes, referred to as temporary differences.

For the years ended December 31, 2024 and year ended December 31, 2023, the Company incurred a net operating loss and, accordingly, no provision for income taxes has been recorded. In addition, no benefit for income taxes has been recorded due to the uncertainty of the realization of any tax assets. At December 31, 2024 and December 31, 2023, the Company had approximately$510,317 and$30,577 of loss of federal net operating losses, respectively. The net operating loss carry forwards, if not utilized, will begin to expire in 2031.

The components of the Company’s deferred tax assets are as follows:

Based on the available objective evidence, including the Company’s history of losses, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets at December 31, 2024 and December 31, 2023, respectively.

Note 13 –Segment Information

We operate in one reportable segment, which is the purchase of land, and building Commercial Grade “Cultivation Centers” to consult, assist, manage & lease to Licensed Dispensary owners and organic grow operators on a contract basis, with a concentration on the legal and medical marijuana sector. The Company’s CODM includes the chief executive officer and chief financial officer. The chief operating decision maker (“CODM”) regularly review and use the consolidated net loss, as reported on our Consolidated Statements of Operations and Comprehensive Loss in evaluating the overall performance of our single reporting segment. As a result, the Company has determined that it has only one reportable segment.

Although the Company has not generated revenue during the reporting period, it continues to incur expenses related to research and development, general and administrative activities, and other operational costs. The CODM uses these expense categories to assess the Company's performance and allocate resources.

The accounting policies of the single segment are the same as those described in the summary of significant accounting policies. There have been no significant changes in measurement methods from the prior year.

Geographically, we have no assets in a foreign country requiring separate disclosure.

The following table provides the significant expenses that management used to manage our one reportable segment:

Note 14 –Subsequent Events

We have evaluated subsequent events through the filing date of this Form 10-K and determined that no subsequent events have occurred that would require recognition in the consolidated financial statements or disclosures in the notes thereto.