Greenwave Technology Solutions, Inc.

Previous wording

We were formed on April 26, 2013 as a technology platform developer under the name MassRoots, Inc. In October 2021, we changed our corporate name from “MassRoots, Inc.” to “Greenwave Technology Solutions, Inc.” We sold all of our social media assets on October 28, 2021 for cash consideration equal to $10,000 and discontinued all operations related to our social media business. On September 30, 2021, we closed our acquisition of Empire Services, Inc. (“Empire”), which operates 13 metal recycling facilities and 1 metal processing facility in Virginia, North Carolina, and Ohio. The acquisition was deemed effective October 1, 2021 on the effective date of the Certificate of Merger in Virginia.

Current wording

We were formed on April 26, 2013 as a technology platform developer under the name MassRoots, Inc. In October 2021, we changed our corporate name from “MassRoots, Inc.” to “Greenwave Technology Solutions, Inc.” On September 30, 2021, we closed our acquisition of Empire Services, Inc. (“Empire”), which operates 13 metal recycling facilities in Virginia, North Carolina, and Ohio. The acquisition was effective October 1, 2021 upon the effectiveness of the Certificate of Merger in Virginia.

Previous wording

We operate an automotive shredder at our Kelford, North Carolina location and a second automotive shredder at our Carrollton, Virginia is expected to come online in the second quarter of 2023. Our shredders are designed to produce a denser product and, in concert with advanced separation equipment, more refined recycled ferrous metals, which are more valuable as they require less processing to produce recycled steel products. In totality, this process reduces large metal objects like auto bodies into baseball-sized pieces of shredded recycled metal.

Current wording

We operate two American Pulverizer 60x85 automotive shredders, one at our Kelford, North Carolina facility and a second at our Carrollton, Virginia yard. Our shredders are designed to produce a denser product and, in concert with advanced separation equipment, more refined recycled ferrous metals, which are more valuable as they require less processing to produce recycled steel products. In totality, this process reduces large metal objects like auto bodies into baseball-sized pieces of shredded recycled metal.

Previous wording

For the years ended December 31, 2023 and 2022, our operating expenses were $33,998,165 and $23,323,774, respectively, an increase of $10,674,391. This increase was mainly attributed to the increase in our hauling fleet, which significantly expanded our operations, number of employees, and internal systems, along with a one-time loss on asset charge. There was a decrease in payroll and related expenses of $356,295 as payroll and related expenses were $6,634,800 for 2023 as compared to $6,991,095 for the same period in 2022, which was the result of the Company’s Chief Executive Officer waiving his quarterly bonuses. Advertising expense increased by $330,201 to $414,194 for 2023 as compared to $83,993 for 2022 as the Company focused its resources on its scrap metal operations. Depreciation and amortization of intangible assets increased by $1,753,476 to $5,814,880 for 2023 from $4,061,404 in 2022 as a result of the Company acquiring additional fixed assets. There were hauling and equipment maintenance costs of $2,898,202 in 2023, as compared to $3,378,452 in 2022, a decrease of $480,250, due to the Company recognizing more of these expenses as cost of revenue. Consulting, accounting, and legal expenses increased to $1,713,613 during the year ended December 31, 2023 from $897,981 during the same period in 2022, an increase of $815,632 due to the Company conducting capital raises. There was a loss on asset of $10,048,308 during the year ended December 31, 2023 as compared to $0 during the same period in 2022, an increase of $10,048,308. There was a decrease in rent expenses as a result of new leases and termination of existing leases, declining $362,032 from $3,464,516 during the year ended December 31, 2022 to $3,102,484 during the same period in 2023. There was common stock issued for services of $171,239 during the year ended December 31, 2023 as compared to $0 during the same period in 2022, an increase of $171,239. There were impairments of goodwill of $0 during the year ended December 31, 2023, as compared to $2,499,753 during the same period in 2022, a decrease of $2,499,753.

Current wording

For the years ended December 31, 2024 and 2023, our operating expenses were $47,251,411 and $33,998,165, respectively, an increase of $13,253,246. There was an increase in payroll and related expenses of $1,546,901 as payroll and related expenses were $8,181,701 for 2024 as compared to $6,634,800 for the same period in 2023, which was the result of the Company expanding its operational staff. Advertising expense decreased by $361,047 to $53,147 for 2024 as compared to $414,194 for 2023 as the Company focused its resources on its scrap metal operations. Depreciation and amortization of intangible assets increased by $1,523,013 to $7,337,893 for 2024 from $5,814,880 in 2023 as a result of the Company acquiring additional fixed assets. Impairment of tangible assets increased by $439,086 to $439,086 for 2024 from $0 in 2023. There were hauling and equipment maintenance costs of $5,296,630 in 2024, as compared to $2,898,202 in 2023, an increase of $2,398,428, due to an increase in repair and fuel costs. Consulting, accounting, and legal expenses increased to $3,179,812 during the year ended December 31, 2024 from $1,713,613 during the same period in 2023, an increase of $1,466,199 due to the Company conducting capital raises. There was a decrease in rent expenses as a result of the Company buying properties it previously rented, declining $422,030 from $3,102,484 during the year ended December 31, 2023 to $2,680,454 during the same period in 2024. There were warrants issued for services of $3,004,909 during the year ended December 31, 2024 as compared to $171,239 during the same period in 2023, an increase of $2,833,770 primarily related to the Company’s registered direct offerings. There was stock based compensation of $823,500 during the year ended December 31, 2024, as compared to $0 during the same period in 2023, an increase of $823,500, as a result of equity awards to the Company’s directors and an officer under its shareholder-approved equity inventive plans. Other general and administrative expenses increased to $3,915,729 for the year ended December 31, 2024 from $3,200,445 for the year ended December 31, 2023, an increase of $715,284, as a result of the Company’s operations expanding.

Previous wording

Our loss from operations increased $8,631,841 to $19,514,762 during the year ended December 31, 2023, from $10,882,921 during the year ended December 31, 2022.

Current wording

Our loss from operations increased $14,747,171 to $34,261,933 during the year ended December 31, 2024, from $19,514,762 during the year ended December 31, 2023.

Previous wording

During the year ended December 31, 2023, we incurred other expenses of $7,421,228, as compared to $24,160,368 for the year ended December 31, 2022, a decrease of $16,739,140. There was a gain on settlement of convertible notes payable and accrued interest, warrants and accounts payable and cancelation of common shares in exchange for Series Y and Series Z preferred shares and cash of $632,540 and $516,920 for the years ended December 31, 2023 and 2022, respectively. We did not realize any gain or loss on the conversion of convertible Notes during the year ended December 31, 2023 while we realized a $2,625,378 gain on the conversion of convertible notes during in the same period in 2022. In addition, interest expense increased to $(8,897,267) during fiscal year 2023 as compared to $(34,079,230) during fiscal year 2022. We did not have a warrant expense for a liquidated damages settlement during the year ended December 31, 2023, while we incurred an expense of $7,408,681 for the same during the year ended December 31, 2022. There was neither a gain nor loss in the fair value of derivative liabilities during the year ended December 31, 2023, as compared to a gain of $14,264,476 during the same period in 2022. There was other gain of $17,572 during the year ended December 31, 2023, as compared to other loss of $(79,231) during the year ended December 31, 2022. There was gain on lease termination of $108,863 during the year ended December 31, 2023 as compared to $0 during the same period in 2022. Lastly, there was a gain on tax credit of $717,064 during the year ended December 31, 2023 as compared to $0 during the same period in 2022.

Current wording

During the year ended December 31, 2024, there was other income of $10,344,580, as compared to $(7,421,228) in other expenses for the year ended December 31, 2023, an increase of $17,765,808. There were losses of $(14,213,480) on the conversion of convertible notes during the year ended December 31, 2024, as compared to $0 during the same period in 2023. There was a gain on settlement of notes payable and accrued interest, along with advances of $1,056,962 and $632,540 for the years ended December 31, 2024 and 2023, respectively. Interest expense decreased to $(5,364,703) during fiscal year 2024 as compared to $(8,897,267) during fiscal year 2023. There was neither a gain nor loss in the fair value of derivative liabilities during the year ended December 31, 2023, as compared to a gain in change of fair value of derivative liabilities of $48,314,949 during the same period in 2024. There was other losses of $15,212 during the year ended December 31, 2024, as compared to other gains of $17,572 during the same period in 2023, respectively. There was gain on lease termination of $108,863 during the year ended December 31, 2023 as compared to $0 during the same period in 2024. There was a gain on tax credit of $717,064 during the year ended December 31, 2023 as compared to $0 during the same period in 2024. There were losses on the extinguishment of debt of $(16,351,827) during the year ended December 31, 2024, as compared to $0 during the same period in 2023. There were warrant expenses for financing of $(3,029,927) during the year ended December 31, 2024, as compared to $0 during the same period in 2023. Lastly, there was an expense of $(52,182) for shares issued for financing during the year ended December 31, 2024, as compared to $0 during the same period in 2023.

Previous wording

Our net loss available to shareholders decreased by $30,262,186 to $33,597,142 during the year ended December 31, 2023, from $63,859,328 during the year ended December 31, 2022.

Current wording

Our net loss available to stockholders increased by $66,849,047 to $100,446,189 during the year ended December 31, 2024, from $33,597,142 during the year ended December 31, 2023.

Previous wording

Cash flows used in operations in 2023 were impacted by depreciation of $2,856,380, amortization of intangible assets of $2,958,500, loss on asset – related party of $9,850,850, loss on assets of $197,458 amortization of right of use assets net of $392,050, amortization of right of use assets-related party net of $1,250,218, interest and amortization of debt discount of $8,897,267, a gain on the settlement of notes payable and factoring advances of $632,540, an increase in due to a related party of $1,824,318, an increase in accounts receivable of $431,155, stock compensation of $171,239, a decrease in inventories of $10,782, a decrease in prepaid expenses of $200,590, an decrease in security deposit of $25,000, gain on deferred revenue of $25,000, gain on lease termination of $108,863 an increase in accounts payable of $856,151 an decrease in payroll wages payable of $614,271, and a decrease in lease liability of $1,619,790. Cash flows used in operations in 2022 were impacted by depreciation of $875,809, amortization of intangible assets of $2,958,500, amortization of right of use assets of $227,185, amortization of right of use assets (related-party) of $2,390,991, impairments on goodwill of $2,499,753, a gain in the fair value of derivative liabilities of $14,264,476, interest and amortization of debt discount of $32,340,565, a gain on the settlement of notes payable and factoring advances of $516,920, a warrant expense for liquidated damages settlement of $7,408,681, an increase in rent due to a related party of $194,916, an increase in accounts receivable of $215,256, a decrease in inventories of $191,356, a decrease in prepaid expenses of $12,838, an increase in security deposits of $3,306, an increase in payroll wages payable of $1,702,145, an decrease in accounts payable of $1,738,665, a decrease in lease liability of $65,030, a decrease in lease liability (related-party) of $2,369,038, gain on settlement of convertible and non-convertible notes payable and accrued interest for cash for $2,625,378, and a decrease in environmental remediation liabilities of $22,207.

Current wording

Net cash used in operating activities for the years ended December 31, 2024 and 2023 was $17,254,723 and $1,833,310, respectively. Cash flows used in operations in 2024 was impacted by depreciation of $7,337,893, loss on asset – related party of $12,338,550, amortization of right of use assets net of $324,608, interest and amortization of debt discount of $5,364,703, a gain on the settlement of notes payable and factoring advances of $1,056,962, a decrease in due to a related party of $1,685,205, an increase in accounts receivable of $745,477, stock compensation of $823,500, stock compensation for services of $3,004,909, loss on extinguishment of $16,351,827, change in fair value of derivative liabilities of $48,314,949, an increase in inventories of $2,689,254, an increase in prepaid expenses of $687,194, loss of conversion of debt of $14,213,480, impairment of equipment of $439,086, an increase in accounts payable of $969,383, an decrease in payroll wages payable of $156,582, an increase in lease liability of $177,417, and a decrease in lease liability (related-party) of $83,430. Cash flows used in operations in 2023 were impacted by depreciation of $2,856,380, amortization of intangible assets of $2,958,500, loss on asset – related party of $9,850,850, loss on assets of $197,458 amortization of right of use assets net of $392,050, amortization of right of use assets-related party net of $1,250,218, interest and amortization of debt discount of $8,897,267, a gain on the settlement of notes payable and factoring advances of $632,540, an increase in due to a related party of $1,824,318, an increase in accounts receivable of $431,155, stock compensation of $171,239, a decrease in inventories of $10,782, a decrease in prepaid expenses of $200,590, an decrease in security deposit of $25,000, gain on deferred revenue of $25,000, gain on lease termination of $108,863 an increase in accounts payable of $856,151 an decrease in payroll wages payable of $614,271, and a decrease in lease liability of $1,619,790.

Previous wording

Net cash used by investing activities was $1,678,176 and $5,936,027 for the years ended December 31, 2023 and 2022, respectively. For the year ended December 31, 2023, there was cash used in the purchase of equipment of $1,760,945 and cash received for the advance of asset of $82,769. For the year ended December 31, 2022, there was cash used in the purchase of equipment of $5,936,027.

Current wording

Net cash used in investing activities was $15,921,990 and $1,678,176 for the years ended December 31, 2024 and 2023, respectively. For the year ended December 31, 2024, there was cash used in the purchase of equipment of $12,339,809 and purchase of equipment from a related-party of $3,582,181.For the year ended December 31, 2023, there was cash used in the purchase of equipment of $1,760,945 and cash received for the advance of asset of $82,769.

Previous wording

Net cash provided by financing activities for the year ended December 31, 2023 and 2022 was $4,235,841 and $6,408,711, respectively. During the year ended December 31, 2023, there were proceeds from non-convertible notes of $1,000,000, proceeds from convertible notes of $13,118,750, proceeds from the sale of common stock of $2,841,181, proceeds from warrant exercises of $15,511 proceeds from bridge financing of $825,000, proceeds from bank overdrafts of $118,763, and proceeds of $3,746,109 from factoring advances, offset by repayments of $4,858,587 towards non-convertible notes and repayments of $12,570,886 towards factoring advances. During the year ended December 31, 2022, there were proceeds from non-convertible notes of $2,725,000 and proceeds of $6,518,310 from factoring advances, offset by repayments of $220,000 towards non-convertible notes, repayments of $221,500 towards notes, repayments of advances of $12,000 and $2,381,099 towards factoring advances.

Current wording

Net cash provided by financing activities for the year ended December 31, 2024and 2023 was $34,207,018 and $4,235,841, respectively. During the year ended December 31, 2024, there were proceeds from warrant exercises of $2,834, 741, proceeds from the sale of common stock and warrants of $40,369,115, proceeds from bank overdrafts of $112,933, and proceeds from factoring advances of $2,843,950, offset by repayments of $2,909,257 towards non-convertible notes, repayments of $3,538,388 towards factoring advances, repayments of $4,008,993 towards a related-party note payable, and repayments of $1,497,083 towards convertible notes payable. During the year ended December 31, 2023, there were proceeds from non-convertible notes of $1,000,000, proceeds from convertible notes of $13,118,750, proceeds from the sale of common stock of $2,841,181, proceeds from warrant exercises of $15,511 proceeds from bridge financing of $825,000, proceeds from bank overdrafts of $118,763, and proceeds of $3,746,109 from factoring advances, offset by repayments of $4,858,587 towards non-convertible notes and repayments of $12,570,886 towards factoring advances.

Previous wording

As of December 31, 2023, we had cash on hand of $1,546,159. We currently have no external sources of liquidity such as arrangements with credit institutions that will have or are reasonably likely to have a current or future effect on our financial condition or immediate access to capital.

Current wording

As of December 31, 2024, we had cash on hand of $2,576,464. We currently have no external sources of liquidity such as arrangements with credit institutions that will have or are reasonably likely to have a current or future effect on our financial condition or immediate access to capital.

Previous wording

As of December 31, 2023, the Company had cash of $1,546,159 and a working capital deficit (current liabilities in excess of current assets) of $(20,579,715). During the year ended December 31, 2023, the net cash used in operating activities was $(1,833,310). The accumulated deficit as of December 31, 2023 was $(395,866,157). These conditions raise substantial doubt about the Company’s ability to continue as a going concern for one year from the issuance of the consolidated financial statements.

Current wording

As of December 31, 2024, the Company had cash of $2,576,464 and a working capital deficit (current liabilities in excess of current assets) of $(13,453,459). During the year ended December 31, 2024, the net cash used in operating activities was $(17,254,723). The accumulated deficit as of December 31, 2024 was $(496,312,346). These conditions raise substantial doubt about the Company’s ability to continue as a going concern for one year from the issuance of the consolidated financial statements.

Previous wording

**Intangible:**Intangible assets with finite useful lives consist of tradenames, licenses and customer relationships and are amortized on a straight-line basis over their estimated useful lives, which range from three to ten years. The estimated useful lives associated with finite-lived intangible assets are consistent with the estimated lives of the associated products and may be modified when circumstances warrant. Such assets are reviewed for impairment when events or circumstances indicate that the carrying value of an asset may not be recoverable. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of an asset and its eventual disposition are less than its carrying amount. The amount of any impairment is measured as the difference between the carrying amount and the fair value of the impaired asset. During the fiscal years ended December 31, 2023 and 2022, the Company recorded $0 and $2,499,753 in impairment expense related to intangibles and goodwill and $2,958,500 and $2,958,500 in amortization of intangible assets, respectively.

Current wording

**Intangible:**Intangible assets with finite useful lives consist of tradenames, licenses and customer relationships and are amortized on a straight-line basis over their estimated useful lives, which range from three to ten years. The estimated useful lives associated with finite-lived intangible assets are consistent with the estimated lives of the associated products and may be modified when circumstances warrant. Such assets are reviewed for impairment when events or circumstances indicate that the carrying value of an asset may not be recoverable. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of an asset and its eventual disposition are less than its carrying amount. The amount of any impairment is measured as the difference between the carrying amount and the fair value of the impaired asset. During the fiscal years ended December 31, 2024 and 2023, the Company recorded $2,958,500 and $2,958,500 in amortization of intangible assets, respectively.