UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-K

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

For Fiscal Year Ended December 31, ~~2021~~ 2022

Commission File Number ~~333~~000-~~176154~~55019

~~Generation Hemp~~Evergreen Sustainable Enterprises, Inc.

(formerly Generation Hemp, Inc.)

(Exact name of registrant as specified in its charter)

DELAWARE		26-3119496
Delaware		26-3119496
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
8533 Midway Road, Dallas, Texas		75209
(Address of principal executive offices)		(Zip code)

(469) 209-6154

(Registrant’s telephone number, including area code)

Securities Registered under Section 12(b) of the Exchange Act:

None

Securities Registered under Section 12(g) of the Exchange Act:

Class: Common Stock, par value $0.00001 per share

Ticker: ~~GENH~~ EGSE

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☑ ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☑☒

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

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

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

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

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

~~Indicate~~If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the ~~registrant~~financial isstatements aof ~~shell~~the ~~company~~registrant ~~(as~~included ~~defined~~ in ~~Rule~~the ~~12b~~filing 2reflect the correction of ~~the~~an ~~Exchange~~error ~~Act).~~to ~~Yes ☐ No~~previously ☑issued financial statements. ☐

~~As of~~Indicate ~~June 30,~~by ~~2021,~~check ~~the~~mark ~~last~~whether ~~business~~any ~~day~~ of ~~the~~those ~~registrant’s~~error ~~most~~corrections ~~recently~~are restatements ~~completed~~that ~~second~~required ~~fiscal~~a ~~quarter,~~recovery ~~the~~analysis ~~aggregate market value~~ of ~~common~~incentive-based ~~stock~~compensation ~~held~~received by ~~non-affiliates~~any of the registrant's ~~was~~executive ~~$24,359,385~~officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

AtIndicate ~~April~~by ~~12,~~check ~~2022,~~mark whether the registrant ~~had~~is ~~113,114,002~~a ~~shares~~shell company (as defined in Rule 12b 2 of ~~common~~the ~~stock~~Exchange ~~outstanding~~Act). Yes ☐ No ☒

As of June 30, 2022, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of common stock held by non-affiliates of the registrant was $18,658,253.

At May 18, 2023, the registrant had 113,254,002 shares of common stock outstanding.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K, the other reports, statements, and information that the Company has previously filed with or furnished to, or that we may subsequently file with or furnish to, the SEC and public announcements that we have previously made or may subsequently make include, may include, or may incorporate by reference certain statements that may be deemed to be “forward- looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, and that are intended to enjoy the protection of the safe harbor for forward-looking statements provided by that Act. To the extent that any statements made in this report contain information that is not historical, these statements are essentially forward-looking. Forward-looking statements can be identified by the use of words such as “anticipate”, “estimate”, “plan”, “project”, “continuing”, “ongoing”, “expect”, “believe”, “intend”, “may”, “will”, “should”, “could”, or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans, or intentions. Forward looking statements contained in this Annual Report on Form 10-K include, but are not limited to statements about:

● the risk that our results could be adversely affected by natural disaster, public health crises (including, without limitation, the recent Coronavirus Disease 2019, or COVID-19, outbreak), political crises, negative global climate patterns, or other catastrophic events;

●

the marketability of our products;

●

financial condition and liquidity of our customers;

●

competition in the hemp markets;

● conditions in the cryptocurrency mining industry, including any prolonged substantial reduction in cryptocurrency prices, and specifically, the value of bitcoin, which could cause a decline in the demand for the Company’s services; ● competition among the various providers of data mining services; ● industry and market conditions;

●

purchases by major customers and our ability to renew sales contracts;

●

credit and performance risks associated with customers, suppliers, banks and other financial counterparties;

●

availability, timing of delivery and costs of key supplies, capital equipment or commodities;

●

our future capital requirements and our ability to raise additional capital to finance our activities;

●

the future trading of our common stock;

●

legal and regulatory risks associated with OTC Markets;

●

our ability to operate as a public company;

●

our ability to protect our proprietary information;

●

general economic and business conditions; the volatility of our operating results and financial condition;

●

our ability to attract or retain qualified senior management personnel and research and development staff;

●

timing for completion of major acquisitions or capital projects;

●

our ability to obtain additional financing on favorable terms, if required, to complete acquisitions as currently contemplated or to fund the operations and growth of our business;

●

operating or other expenses or changes in the timing thereof;

●

compliance with stringent laws and regulations, as well as changes in the regulatory environment, the adoption of new or revised laws, regulations and permitting requirements;

●

potential legal proceedings and regulatory inquiries against us; and

●

other risks identified in this Quarterly Report that are not historical.

You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Annual Report on Form 10-K primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in the section titled “Risk Factors” and elsewhere in this Annual Report on Form 10-K. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Annual Report on Form 10-K. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

The forward-looking statements made in this Annual Report on Form 10-K relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements to reflect events or circumstances or to reflect new information or the occurrence of unanticipated events, except as required by law.

SUMMARY RISK FACTORS

The risk factors described below are a summary of the principal risk factors associated with an investment in us. These are not the only risks we face. The below summary is qualified in its entirety by that more complete discussion of such risks and uncertainties. You should carefully consider these risk factors, together with the risk factors set forth in “Item 1A. Risk Factors” of this Report and the other reports and documents filed by us with the U.S. Securities and Exchange Commission (“SEC”).

Risks Related to Our Business

● There is substantial doubt that we will be able to continue as a going concern. ● We have a history of significant losses, which could continue in the future, and we may never achieve nor maintain profitability. ● ~~The impact of the spread of COVID-19 and the measures taken to mitigate it are adversely affecting our business, operations and financial condition. ●~~ Unfavorable global economic or political conditions could adversely affect our business, financial condition or results of operations. ● We have a limited operating history in two new sectors and operate under the professional guidance of our Chairman and CEO. ● We may be unable to manage our growth or implement our expansion strategy, especially in the bitcoin industry. ● The issuance of additional shares of our common stock may be necessary for the implementation of our growth strategy. ● The loss of our current chief executive officer or key management personnel or inability to attract and retain the necessary personnel could have a material adverse effect upon our business, financial condition or results of operations. ● Our Chief Executive Officer has significant influence over our operations. ● It is likely that conflicts of interest may arise in the day-to- day operations of our business. Such conflicts, if not properly resolved, could have a material negative impact on our business. ● Adverse outcomes in any future legal proceedings could subject us to substantial damages and adversely affect our results of operations and profitability. ● We will seek to expand through acquisitions of and investments in various brands, businesses, and assets in the Hemp sector. These acquisition activities may be unsuccessful or divert management’s attention. ● We risk insolvency if revenues decline sharply and we are unable pay our bills and unable to timely locate and negotiate a suitable business combination or capital injection. ● We are subject to certain corporate governance and internal control reporting requirements, and our costs related to compliance with, or our failure to comply with existing and future requirements, could adversely affect our business. ● Natural and other disasters, information technology system failures and network disruptions and cybersecurity breaches and attacks could adversely affect our business. ● Failure to comply with U.S. federal, state and international laws and regulations relating to privacy or data protection, or the expansion of current or the enactment of new laws or regulations relating to privacy or data protection, could adversely affect our business and our financial condition.

● Hemp prices have historically been very volatile and can directly affect the desire or willingness of farmers to grow new hemp crops each year, which is necessary for us to maintain our drying operations.

●

Hemp prices have historically been very volatile and can directly affect the desire or willingness of farmers to grow new hemp crops each year, which is necessary for us to maintain consistent drying operations.

Risks Related to our Activities in the Legal Hemp Industry

● We will be subject to a myriad of different laws and regulations governing hemp and ~~our~~bitcoin. Our inability to comply with such laws in a cost-effective manner may have an adverse effect on our business and result of operations. ● We have limited operating history in the legal hemp or cannabis industry, which makes it difficult to accurately assess our future growth prospects. ● ~~Because we only began our legal hemp operations in early 2021, we anticipate our operating expenses will increase prior to earning revenue from these operations. ●~~ Negative press from being in the hemp and/or bitcoin space could have a material adverse effect on our business, financial condition, and results of operations.

Risks Related to Ownership of Our Common Stock

● Our stock price has been and may continue to be volatile, and you could lose all or part of your investment. ● Our operating results will be subject to fluctuations and our stock price may decline significantly. ● There are restrictions on the transferability of certain of our securities. ● If the Company uses its stock in acquisitions of other entities, there may be substantial dilution at the time of a transaction. ● Trading on the OTC Markets ~~may~~can be volatile and sporadic, which could depress the market price of our common stock and make it difficult for our stockholders to resell their shares. ● The Company currently plans move to a more advantageous trading market and then potentially uplist, to a national exchange, however, there is no assurance that we will be able to successfully move trading markets or uplist to a national exchange. ● Because we do not expect to pay any dividends for the foreseeable future, investors may be forced to sell their stock to realize a return on their investment. ● Our common stock is presently subject to the “Penny Stock” rules of the SEC. ● If we fail to remain current on our reporting requirements, we could be removed from the OTCQB which would limit the ability of broker-dealers to sell our securities in the secondary market. ● If we ultimately decide to implement a reverse stock split in order to meet certain minimum stock prices required on a national exchange, the liquidity of the shares of our common stock will likely decrease accordingly.

iii

~~WHERE YOU~~EVERGREEN ~~CAN~~SUSTAINABLE ~~FIND~~ENTERPRISES, ~~MORE INFORMATION~~INC.

~~We file annual, quarterly and current reports, proxy statements and other information required by the Securities Exchange Act of 1934, as amended~~ (~~the~~FORMERLY ~~“Exchange~~GENERATION ~~Act”)~~HEMP, ~~with the Securities and Exchange Commission (the “SEC”)~~INC. You may read and copy any document we file with the SEC at the SEC’s public reference room located at 100 F Street, N.E., Washington, D.C. 20549, U.S.A. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Our SEC filings are also available to the public from the SEC’s internet site at http://www.sec.gov.)

~~On our~~FORM Internet website, http://www.genhempinc.com, we post the following recent filings as soon as reasonably practicable after they are electronically filed with or furnished to the SEC: our annual reports on Form 10-K, ~~our~~FOR ~~quarterly~~THE ~~reports~~YEAR onENDED ~~Form~~DECEMBER ~~10-Q~~31, ~~our current reports on Form 8-K, and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act.~~2022

GENERATION HEMP, INC.

FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2021

TABLE OF CONTENTS

		Page
PART I		1
Item 1.	Description of Business	1
Item 1A.	Risk Factors	68
Item 1B.	Unresolved Staff Comments	1526
Item 2.	Properties	1526
Item 3.	Legal Proceedings	1526
Item 4.	Mine Safety Disclosures	1526
PART II		16
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	1627
Item 6.	Reserved	1728
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1828
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	2232
Item 8.	Financial Statements and Supplementary Data	F-1
Item 9.	Changes In and Disagreements with Accountants on Accounting and Financial Disclosure	2333
Item 9A.	Controls and Procedures	2333
Item 9B.	Other Information	2333
Item 9C.	Disclosures Regarding Foreign Jurisdiction that Prevent Inspections	2333
PART III		24
Item 10.	Directors, Executive Officers and Corporate Governance	2434
Item 11.	Executive Compensation	2838
Item 12.	Security Ownership of Certain Beneficial Owners and Management And Related Stockholder Matters	3040
Item 13.	Certain Relationships and Related Transactions and Director Independence	3141
Item 14.	Principal Accountant Fees and Services	3242
Item 15.	Exhibits and Financial Statement Schedules	3343
Signatures		3748

viv

PART I

Item 1. Business

Generation Hemp, Inc. (the “Company”), was incorporated on August 21, 2021 in the State of Delaware. The Company was originally incorporated on July 28, 2008 in the State of Colorado. On November 27, 2019, Home Treasure Finders, Inc. (“HTF”) acquired approximately 94% of the common stock of Energy Hunter Resources, Inc. (“EHR”) in a series of transactions accounted for as a reverse merger (the “Transaction”). Upon closing of the Transaction, HTF changed its name to Generation Hemp, Inc.Overview

~~On January~~Evergreen ~~11,~~Sustainable ~~2021~~Enterprises, weInc. ~~completed~~(formerly Generation ~~the~~Hemp, ~~acquisition~~Inc.) of(the ~~certain~~“Company” ~~assets~~or of“Evergreen ~~Halcyon Thruput~~Sustainable”), ~~LLC~~was ~~(“Halcyon”).~~incorporated ~~With~~on ~~this~~August ~~acquisition~~21, 2021 in the weState ~~commenced~~of ~~providing~~Delaware. ~~post-harvest~~The ~~and~~Company ~~midstream~~was ~~services~~originally toincorporated ~~growers~~on byJuly ~~drying~~28, ~~processing,~~2008 ~~cleaning~~in ~~and~~the ~~stripping~~State ~~harvested~~of ~~hemp~~Colorado. ~~directly from~~On ~~the~~November ~~field~~27, ~~and~~2019, ~~wetbaled~~Home atTreasure Finders, ~~our~~Inc. ~~48,000~~(“HTF”) ~~square~~acquired ~~foot~~approximately ~~leased~~94% ~~facility~~of ~~located~~the incommon ~~Hopkinsville,~~stock ~~Kentucky.~~of ~~Additionally,~~Energy ~~the~~Hunter ~~Company~~Resources, ~~offers~~Inc. (“EHR”) ~~safe~~in ~~storage~~a ~~services~~series ~~for~~of ~~processed~~transactions ~~hemp,~~accounted ~~which~~for ~~enables~~as ~~farmers~~a toreverse ~~maximize~~merger ~~strategic~~(the ~~market timing~~“Transaction”). InUpon ~~August~~closing ~~2021,~~of the ~~Company~~Transaction, ~~launched~~HTF changed its ~~small~~name ~~animal~~to ~~bedding~~Generation ~~consumer~~Hemp, ~~goods~~Inc. ~~product~~In ~~line~~March ~~(“Rowdy~~2023, ~~Rooster”) made from~~ the ~~hemp~~Company ~~hurd~~changed ~~byproduct~~its ~~that~~name isto ~~produced from~~Evergreen ~~its~~Sustainable ~~hemp~~Enterprises, ~~processing operations~~Inc.

~~We also~~On ~~generate~~January ~~revenue~~11, ~~from~~2021, ~~rental~~we completed the acquisition of ~~our~~certain ~~“Cannabis~~assets ~~Zoned”~~of Halcyon Thruput, LLC (~~Hemp~~“Halcyon”). ~~warehouse~~With ~~property~~this acquisition, we commenced providing post-harvest and midstream services to growers by drying, processing, cleaning and stripping harvested hemp directly from the field and wetbaled at our 48,000 square foot leased facility located in ~~Denver~~Hopkinsville, ~~Colorado~~Kentucky. ~~currently~~Additionally, the Company offers safe storage services for processed hemp, which ~~leased~~enables farmers to anmaximize ~~unaffiliated~~strategic market timing. In September 2021, the Company launched its small animal bedding consumer goods product line (“Rowdy Rooster”) made from the hemp ~~seed~~hurd ~~company~~byproduct that is produced from its hemp processing operations. In September of 2022, the Company launched its industrial absorbent consumer goods product line (Gas Monkey Spill-Jack), also made from the hemp hurd byproduct produced from its hemp processing operations. This second product line is marketed under a branding agreement with Gas Monkey Garage, a well-known brand in the automotive and entertainment sector.

~~As of~~ We ~~December~~also ~~31,~~generate ~~2021,~~revenue ~~EHR~~from ~~held~~rental anof our ~~approximate~~“Cannabis 8%Zoned” ~~working~~(Hemp) ~~interest~~warehouse ~~in an oil & gas~~ property located in ~~Cochran County~~Denver, ~~Texas~~Colorado ~~within the Slaughter-Levelland Field of the San Andres formation in the Northwest Shelf of West Texas. EHR’s oil & gas activities are~~ currently ~~held~~leased ~~for~~to ~~sale~~an ~~and~~unaffiliated ~~are~~hemp ~~presented~~seed ~~in these consolidated financial statements as discontinued operations for each of the periods presented~~company.

~~Our management~~As ~~team~~of ~~has~~December ~~been~~31, ~~and~~2022, ~~continues~~EHR toheld ~~actively~~an ~~review~~approximate 8% ~~acquisition~~working ~~candidates~~interest ~~involved~~ in ~~the~~an ~~hemp~~oil ~~industry~~& ~~that~~gas ~~operate~~property located in Cochran County, Texas within ~~a number~~the Slaughter-Levelland Field of ~~vertical~~the ~~businesses,~~San ~~predominantly~~Andres formation ~~within~~in the ~~midstream~~Northwest ~~sector~~Shelf ~~that~~of West Texas. EHR’s oil & gas activities are ~~attractive~~currently toheld usfor sale and are ~~within~~presented ~~the~~in these ~~hemp~~consolidated ~~supply~~financial ~~chain~~statements as discontinued operations for each of the periods presented.

~~To fund~~Our ~~our~~management ~~business~~team ~~activities,~~has webeen ~~have~~and ~~historically~~continues ~~completed~~to actively areview ~~number~~acquisition ofcandidates ~~private~~involved ~~placements~~in ofthe ~~equity~~hemp ~~and~~industry ~~debt.~~that Weoperate ~~continue~~within toa ~~seek~~number ~~additional public or private placements~~ of ~~our~~vertical ~~stock~~businesses, ~~and~~predominantly within ~~debt.~~the ~~Our~~midstream ~~common~~sector ~~shares~~that are ~~quoted~~attractive onto ~~the~~us ~~OTCQB~~and ~~Markets~~are ~~under~~within the ~~symbol~~hemp ~~“GENH~~supply chain.”

~~Principal~~To fund our business activities, we have historically ~~Services~~completed a number of private placements of equity and ~~their~~debt. We continue to seek additional public or private placements of our stock and debt. Our common shares are quoted on the OTCQB Markets under the symbol “EGSE.”

~~Generation Hemp~~Subsequent is positioning itself to be a pure-play, fully integrated hemp company through its acquisitions of existing established companies operating in the rapidly growing hemp sector with success as profitable first movers.Events

~~We provide~~In ~~post-harvest and midstream services to growers by drying~~January 2023, ~~processing,~~the ~~cleaning,~~Company ~~stripping~~announced ~~harvested~~a ~~hemp~~new ~~directly~~strategic ~~from~~direction ~~the~~into ~~field and~~sustainable ~~wetbaled~~energy ~~at our leased 48~~projects,~~000~~ ~~square~~starting ~~foot~~with ~~facility~~bitcoin ~~located in Hopkinsville, Kentucky~~mining. The ~~drying services technology greatly increases~~Company’s ~~efficiency~~name ~~and~~was ~~capacity~~changed ~~during harvest for farmers who need~~ to ~~quickly~~Evergreen ~~move~~Sustainable ~~harvested~~Enterprises, ~~hemp~~Inc. ~~while preserving the cannabinoid potency by providing scalable infrastructure essential to receive and process hemp with high moisture content~~ (“~~wet~~EGSE”) ~~quickly.~~in ~~Additionally, the~~March ~~Company offers safe storage services for processed hemp, which enables farmers to maximize strategic market timing~~2023. The ~~midstream business~~Company’s isexisting ~~fee~~hemp ~~income oriented, based upon a price per pound of material handled, and therefore is more protected from significant commodity~~operations ~~price~~will ~~variations.~~continue ~~The facility is able~~ to ~~process~~be ~~approximately~~maintained ~~10,000 wet pounds per hour and the potential to scale up to 20,000 wet pounds per hour in order to meet market demands~~ as ~~licensed~~a ~~and~~fully ~~harvested~~operating ~~hemp~~wholly-owned ~~acreage continues to increase across Kentucky, Tennessee, Ohio, and other states~~subsidiary.

WeOn January 9, 2023, the Company purchased 80% ~~also~~of ~~own~~Toro ~~one~~Energía ~~industrial~~Sociedad ~~warehouse~~Anonima ~~located~~(“Toro”), a Costa Rican corporation with ownership of a hydroelectric dam in ~~Denver,~~Costa Rica. ~~Colorado~~The ~~and~~source ~~lease~~of ~~100%~~approximately one megawatt of ~~this~~power ~~space~~produced ~~within~~from ~~that~~the ~~project~~hydroelectric todam ~~aid~~(six agenerators) ~~licensed~~will ~~hemp~~be used to power new ~~seed~~Bitcoin ~~grower.~~mining Wemachines ~~exercise~~at ~~appropriate~~an ~~and~~extremely ~~reasonable~~low ~~care~~cost. toThe ~~screen~~transaction ~~our~~was ~~tenants,~~completed ~~require~~based ~~and~~on ~~verify~~a ~~that~~total ~~our~~enterprise ~~tenants~~value ~~maintain~~for ~~proper~~Toro ~~licenses~~of $2,750,000, ~~and~~including ~~operate~~seller-financed indebt ~~compliance~~of ~~with~~$985,000. ~~all~~The ~~applicable~~seller-financed ~~rules~~debt has a term of 10 years and ~~regulations~~a at9.5% per annum variable interest rate (based on the ~~federal,~~prime ~~state,~~rate) ~~and~~with ~~local~~straight ~~level~~line amortization.

~~We may~~The ~~own~~purchase ~~properties~~price for ~~our~~80% ~~own~~of ~~investment~~Toro’s ~~account~~equity was $1,412,000. These amounts were paid in cash from proceeds of a Secured Promissory Note (“Secured Note”) with Gary C. Evans, CEO of the Company (‘Evans”). Under the terms of the Secured Note, (a) the Company and asEvans restructured (i) the Subordinated Promissory Note, dated November 20, 2020 and (ii) Convertible Promissory Note, dated July 20, 2021, such ~~are~~that ~~solely~~all ataccrued and ~~financial~~unpaid ~~risk~~interest inon ~~connection~~each ~~with~~note ~~our~~were ~~investments~~rolled into a new Secured Note, (b) Evans lent the Company $500,000 on January 9, 2023 and $969,000 on January 10, 2023. InThe Secured Note has a maturity date of July 15, 2023 and bears interest at the rate of 10.00% per annum. The Secured ~~event~~Note wehas ~~utilize~~a ~~funds~~conversion ~~loaned~~feature which permits Evans to usconvert byat ~~third~~the ~~party~~Maturity ~~groups,~~Date ~~they~~then ~~may~~outstanding inprincipal ~~some~~and ~~circumstances~~interest ~~share~~at ~~certain~~a ~~risks~~conversion price of $0.275 (the closing price of the Company’s stock on January 9, 2023).

~~We do~~The ~~not~~Toro ~~grow,~~Dam ~~distribute~~is orlocated ~~sell~~approximately ~~any~~25 ~~form~~miles from ofSan ~~cannabis.~~Jose Webetween ~~have~~two novolcano ~~present~~craters. ~~plan~~The tosite ~~engage~~generates inall ~~such~~its ~~activities~~energy orfrom ~~obtain~~green aresources ~~license~~with toa ~~do so,~~proven ~~now,~~98% orrun intime over the many ~~future.~~years Weit ~~currently~~has ~~plan~~been ~~to only operate~~ in ~~the~~operation ~~hemp~~and ~~space.~~has Wea ~~are~~full-time staff in ~~the~~place ~~process~~under ofa ~~expanding~~new ~~our~~Operating ~~operations~~& ~~into other~~Maintenance ~~states, predominantly Kentucky and North Carolina~~Agreement.

~~Marketing~~Hydroelectric power is a clean and renewable energy source that is used to generate electricity by harnessing the energy of ~~our~~falling ~~Services~~water and can provide a reliable and a very cost-effective source of energy for bitcoin mining operations. Hydroelectric power can help reduce the carbon footprint of cryptocurrency mining, as many cryptocurrencies are produced using fossil fuels, which continues to contribute to greenhouse gas emissions and climate change. By using hydroelectric power, bitcoin mining can be made more environmentally friendly and sustainable and can help improve the stability and reliability of cryptocurrency networks. Hydroelectric power is a relatively stable and reliable source of energy, compared to other sources such as coal or fossil fuels, which can be prone to price fluctuations and supply disruptions. The Company has committed to acquire and made financial payments for the purchase of 240 new Bitmain S19J Pro+ ASIC miners that will be deployed at the Toro Dam sometime in the first quarter of 2023.

~~The market,~~Corporate clients, customers and distribution methods for hemp services and hemp-based products are large and diverse. These markets range from hemp mid-stream services for hemp growers/farmers, to hemp derived products like bioplastics, textiles, building materials, food additives, and dietary supplements. Awareness and demand continue to grow for “green,” environmentally-friendly products derived from hemp, and the consumer market has already begun to integrate hemp products and products that contain hemp derivatives to existing product lines. The distribution system is constantly evolving as small retailers, retail chains, and big box stores become increasingly educated on and familiar/comfortable with hemp and its derivatives. The current market is focused on one of the cannabinoids derived from hemp called cannabidiol (“CBD”) and consumer goods that contain CBD. Additionally, consumer awareness followed by increased demand continues to drive and even force companies to make room on their shelves for hemp and products with hemp derivatives. For products with hemp derivatives like CBD, direct to consumer Ecommerce through online store sales remains the main source of revenue for consumer goods companies, accounting for reported percentages of approximately 70-80% of sales. Structure

The Company’s ~~continues~~business tooperations ~~implement a plan to become more diversified within the midstream market. Our marketing efforts began with~~are aconducted ~~grass~~through ~~roots~~several ~~approach~~operating insubsidiaries ~~order to meet~~ with ~~farmers,~~its ~~growers,~~core ~~and~~operational ~~seed operations that would benefit from midstream services. To supplement the grass roots outreach, we built our online web presence to reflect our desire to educate, to become a contributor~~ and ~~part~~ ofbusiness ~~the~~activities ~~hemp~~directed ~~community,~~through ~~and also to act as a pioneer company to connect investors in the U~~Evergreen Sustainable.S. ~~public~~These ~~markets~~subsidiaries toare alisted ~~hemp education and platform that is dually informed.~~ below:

~~We maintain~~● ~~and~~GENH ~~update~~Halcyon our website and engage on social media platforms to market our ongoing hemp sector efforts. We use globally distributed YouTube video ad campaigns to increase our brand awareness and encourage markets and the investment community to learn more about the hemp space. These videos have been played on several business sites such as CNBCAcquisition, ~~MSNBC,~~LLC– ~~Fox~~Hemp News, Fox Business, Yahoo Finance, among others. We have also begun to market a version of “Fireside Chats” from our Chairman and CEO to talk about various topics of interest in the hemp space. These video segments will post on our social media platforms and they will also be used to create awareness campaigns that should have a global outreach. In order to reach region specific growers/farmers in hemp, we have teed up direct mail marketing materials which prove effective for service markets within a specified radius. These materials will serve as invitations to the farmers and growers in areas that the midstream ~~services~~processing ~~which~~operations ~~we are acquiring will reach. These are designed to add an identity to the midstream facility~~ and ~~provide an offer of help and partnership. As we continue to become involved with additional verticals in the~~ hemp ~~supply~~consumer ~~chain,~~goods we will expand and tailor these marketing and advertising efforts to the specific needs of each segment. To-date all marketing, ad creation, ad campaigns, and creative work has been done internally and with a minimal budget. Upon the ease of COVID-19 restrictions, we began to increasingly pursue, attend, and present at, and/or exhibit in a number of industry tradeshows, and conferences and small cap investor conferences.products

~~In 2021,~~● ~~we increased our marketing efforts by engaging several industry and investor media platforms by providing or collaborating on sponsored content in the form of articles~~CryptoRica, ~~interviews,~~LLC and podcasts in order to continue to educate the public and investors on the hemp industry and our company’s various products, services, and business plan. We have been featured on USA Today, Small Caps Daily, Benzinga, Reddit, and Cannabis Wealth Magazine. Gary C. Evans has also been a guest on KRLD News Radio Dallas to discuss the Company, along with several podcasts and webinars. We have also continued to build out our social media presence on Instagram, TikTok, Facebook (Meta), Twitter, LinkedIn, and YouTube. We are attempting to post video and/or static posts at least twice per week and designing content based on statistical data of engagement metrics –Bitcoin ~~what~~mining ~~content~~operations islocated ~~trending,~~in ~~what~~Costa users are most responsive to, and what times receive the most user reach and engagement. For reference, when comparing social media engagement from October 18, 2021 – December 28, 2021 to the same period for 2020, reach increased by 4,912% and engagement increased by 420% due to these efforts by management and the social media team.Rica

2● Razorback I, LLC –Bitcoin mining operations located in Arkansas

~~Subsequent Events~~● Bluegrass I, LLC– Bitcoin mining operations located in Kentucky

~~Execution of~~● ~~“Gas~~Energy ~~Monkey”~~Hunter ~~Merchandise Licensing Agreement - On February 17~~Resources, ~~2022, Generation Hemp,~~ Inc.– ~~executed~~Energy a merchandise licensing agreement with world-renowned brand, Gas Monkey Garage. Generation Hemp will manufacture a USA grown hemp hurd spill absorbent and market this new product under the Gas Monkey brand name to consumers, retailers, and distributors as an environmentally sustainable, USA made, ultra-absorbent spill clean-up material. This will be Generation Hemp’s second environmentally sustainable consumer goods product line made from U.S. grown hemp hurd. Spill absorbents are typically used in garages, factories, or industrial settings to quickly contain spills of oil and other liquids. Spill absorbents are also used at the site of auto accidents to quickly contain leaks of oil and other fluids due to collisions.operations

~~Richard Rawlings,~~Principal ~~owner~~Services and ~~founder~~their of Gas Monkey Garage, is the star of the international hit series’ “Fast N’ Loud” & “Garage Rehab” spanning 17+ seasons and 200+ episodes. Mr. Rawlings and Gas Monkey have migrated the show to an online platform and consistently produce new episodes that premiere every week on YouTube and Facebook. With his experience of owning and running a garage for over 18 years, Richard Rawlings found the sustainable spill absorbent to be of great significance.Markets

~~There~~The Company has diversified itself to take advantage ~~are~~of ~~several~~the ~~types~~two developing industries of ~~spill~~industrial ~~absorbents~~hemp ~~with~~and ~~varying~~bitcoin ~~characteristics~~mining. ~~These~~Within ~~are~~both inindustries, ~~three~~there ~~general~~are ~~categories~~vast –opportunities ~~mineral~~to ~~based, animal~~embody orand ~~vegetable~~drive ~~based~~environmental, social, and ~~synthetic~~corporate orgovernance ~~organic~~(“ESG”) ~~polymers~~advancements. ~~The~~Within ~~challenge~~its inhemp ~~choosing~~operations anand ~~absorbent~~product islines, the ~~finding~~Company ancontinues ~~effective~~to ~~absorbent~~be ~~that does not pose~~ a ~~threat~~leader toin ~~health~~building orout the ~~environment,~~infrastructure ~~whether~~to ~~that~~support ~~threat~~the isfiber ~~posed~~and ~~when~~hurd ~~that~~hemp ~~material~~supply ischain ~~procured~~for ~~or used~~industrial applications. ~~For~~Within ~~example, a~~its ~~widely~~bitcoin ~~used~~mining ~~spill~~operations ~~absorbent~~and ~~material~~developing inbitcoin ~~products~~mining isoperations, ~~Bentonite~~the ~~Clay.~~Company ~~This~~ is ~~often~~primarily autilizing ~~very~~diversified green ~~dusty~~energy ~~material~~sources ~~and~~to ~~has~~power ~~warnings~~modular ofbitcoin ~~containing unsafe~~mining ~~levels~~arrays ~~of lead (FDA)~~ and istargeting ~~associated~~rural ~~with~~or aremote ~~number~~areas ofthat ~~health~~benefit ~~complaints~~both inresidents ~~humans~~and local utilities.

~~Generation~~In addition to our hydroelectric powered bitcoin ~~Hemp~~operations in Costa Rica, ~~Inc.~~the ~~tested~~Company ~~its~~is in development on several bitcoin mining arrays in several rural or remote U.S. ~~grown~~locations. ~~and~~We have ~~milled~~two ~~hemp~~bitcoin ~~hurd~~mining ~~against~~arrays ~~currently~~in ~~used~~development ~~absorbents~~in onArkansas, ~~the~~an ~~market~~eight ~~and~~(8) ~~the~~megawatt ~~findings~~array ~~showed~~in itsouth tocentral Arkansas. We also have three bitcoin asmining ~~effective~~arrays orlocated ~~more~~in ~~effective~~Kentucky, ~~absorbency~~a five (5) megawatt array in Carter County and ~~ability~~two toadditional ~~contain~~sites ~~spills~~in various stages of development in Greenup County and again in Carter County that will potentially be a total of an additional eighteen (18) megawatts, including a site that is in-part powered with hydroelectricity.

~~Joint~~Our hemp processing operations provide post-~~Venture~~harvest ~~With~~and ~~Crypt~~midstream ~~Solutions~~services to growers by drying, ~~Inc~~processing, cleaning, stripping harvested hemp directly from the field and wetbaled at our leased 48,000 square foot facility located in Hopkinsville, Kentucky. toThe ~~Utilize~~drying ~~Hemp~~services ~~Hurd~~technology ~~Biomass~~greatly asincreases ~~Biofuel~~efficiency and capacity during harvest for farmers who need to ~~Power~~quickly ~~Bitcoin~~move ~~Mining~~harvested –hemp Onwhile ~~January~~preserving ~~16,~~the ~~2022,~~cannabinoid ~~Generation~~potency by providing scalable ~~Hemp,~~infrastructure ~~Inc.~~essential to receive and ~~Crypt~~process ~~Solutions,~~hemp ~~Inc.,~~with ~~DBA~~high ~~Cryptech~~moisture ~~Solutions~~content (“~~Crypt~~wet”) aquickly. ~~leading~~Additionally, ~~player~~the inCompany offers ~~the~~safe ~~cryptocurrency~~storage ~~space~~services for processed hemp, ~~executed a~~which ~~Memorandum~~enables offarmers ~~Understanding~~to ~~and~~maximize ~~Letter~~strategic ofmarket ~~Intent~~timing. toThe ~~build~~midstream ~~“Green~~business ~~Energy”~~is fee ~~plants~~income oriented, based upon a price per pound of material handled, and ~~Bitcoin~~therefore ~~mining~~is ~~complexes~~more ~~that~~protected ~~will utilize~~from ~~hemp~~significant ~~feedstock~~commodity asprice variations. aThe ~~fuel~~facility ~~source~~is able to ~~power~~process ~~Bitcoin~~approximately ~~mining~~10,000 ~~equipment~~wet ~~and~~pounds ~~offset~~per hour and the ~~draw~~potential onto ~~power~~scale ~~from~~up ~~the~~to ~~local~~20,000 ~~utility.~~wet ~~Plans~~pounds ~~for~~per ~~this~~hour ~~complex~~in ~~also~~order ~~include~~to ~~Generation~~meet ~~Hemp’s~~market ~~additional~~demands as licensed and harvested hemp ~~drying~~acreage continues to increase across Kentucky, Tennessee, Ohio, Alabama and ~~processing~~other ~~facilities~~states.

~~With theincreasing~~We ~~adoption~~also ~~and~~own ~~integration~~one ofindustrial ~~cryptocurrency~~warehouse located in Denver, ~~mainstream~~Colorado ~~channels~~ and ~~throughout~~lease ~~the~~100% ~~global~~of ~~economy,~~this ~~there~~space ~~has~~within ~~been~~that ~~an enormous~~project ~~draw on the energy grid for powering the necessary data processing equipment required~~ to ~~maintain~~aid ~~these~~a ~~cryptocurrency~~licensed ~~mining systems~~hemp ~~24/7~~seed grower. ~~Generation~~We ~~Hemp,~~exercise ~~Inc.~~appropriate and ~~Crypt Solutions, Inc. have begun to assemble the necessary pieces of a diversified “Green~~reasonable ~~Energy”~~care ~~plant~~ to ~~create~~screen anour ~~independent~~tenants, ~~power~~require ~~source~~and ~~for~~verify ~~the~~that ~~primary~~our ~~purpose~~tenants ofmaintain ~~powering~~proper ~~Bitcoin~~licenses ~~mining~~and operate in ancompliance ~~effort~~with toall ~~resolve~~applicable ~~any~~rules ~~added~~and ~~pressure~~regulations onat the ~~electrical grid. Environmentally sustainable hemp~~federal, ~~a green feedstock~~state, ~~will~~and ~~be used for Btu generation to offset the draw of electricity from~~ local ~~utility companies~~level. The Btu generation of hemp is comparable to wood biomass Btu generation. The utilization of solar power to complement the system will also be explored. Generation Hemp currently plans to explore harnessing the high levels of heat generated from the data processing operations produced from Bitcoin mining equipment to redistribute that heat as supplemental Btus to dry hemp.

~~As a~~We ~~renewable~~may ~~energy~~own ~~source~~properties ~~with the utilization of hemp feedstock~~ for ~~fuel,~~our ~~all~~own ~~steps~~investment ~~will be taken to register these facilities for Renewable~~account ~~Energy Credits (RECs) once completed~~ and ~~operational.~~as ~~Contributing~~such ~~renewable,~~are ~~“Green~~solely ~~Energy”~~at tofinancial ~~the~~risk ~~overall electrical grid will help electric power suppliers stay~~ in ~~compliance~~connection with ~~state~~our ~~initiatives~~investments. ~~that~~In ~~require~~the aevent ~~certain~~we ~~percentage~~utilize offunds ~~their~~loaned ~~electricity~~ to ~~come~~ ~~from~~us ~~renewable~~by ~~energy~~third party groups, ~~which~~they ~~helps~~may ~~foster~~in ~~and~~some ~~develop~~circumstances ~~the~~share ~~infrastructure~~certain ~~and implementation of renewable energy~~risks.

~~On February~~We ~~23,~~do ~~2022,~~not ~~Generation Hemp~~grow, ~~Inc.~~distribute ~~and~~or ~~Crypt~~sell ~~executed~~any ~~their~~form ~~first Letter~~ of ~~Intent that specifically applies to their joint Green~~ ~~Energy~~cannabis. ~~project,~~We tohave beno ~~located~~present ~~adjacent~~plan to ~~Generation~~engage ~~Hemp’s~~in ~~wholly-owned~~such ~~subsidiary,~~activities ~~GENH~~or ~~Halcyon~~obtain ~~Acquisition’s~~a ~~current~~license ~~hemp processing~~to ~~facility~~do ~~in Hopkinsville~~so, ~~Kentucky. This first project is being designed for two (2) megawatts of Bitcoin mining~~now, ~~which~~or ~~will include~~in ~~approximately~~the ~~576 mining machines~~future. ~~The~~We ~~Bitcoin~~currently ~~mining installation is expected~~ plan to beonly ~~running~~operate ~~prior~~in to the ~~end~~hemp ~~of the second quarter 2022~~space. ~~Initial~~We ~~electricity~~are ~~needs~~in ~~for~~ the ~~project~~process ~~will~~of ~~come~~expanding ~~from~~our ~~the~~operations ~~grid~~into orother ~~the~~states, ~~existing~~predominantly ~~electricity~~Kentucky ~~provider~~and ~~until such time as biomass~~North ~~or other renewable methods are installed~~Carolina.

~~Competition~~Marketing of our Services

The market, clients, customers and distribution methods for hemp ~~industry~~services and hemp-based ~~consumer~~products ~~product~~are ~~industry~~large isand ~~highly~~diverse. ~~competitive~~These ~~and~~markets ~~fragmented~~range infrom ~~its~~hemp ~~nascency~~mid-stream ~~with~~services ~~numerous~~for ~~companies~~hemp growers/farmers, ~~consisting~~to ofhemp ~~publicly~~derived ~~(mostly~~products ~~Canadian)~~like bioplastics, textiles, building materials, food additives, and ~~privately-owned~~dietary ~~companies~~supplements. Awareness and ~~There~~demand ~~are~~continue ~~also~~to ~~large~~grow for “green,” ~~well~~environmentally-~~funded~~friendly ~~companies~~products ~~beginning~~derived tofrom ~~emerge in~~hemp, and the ~~U.S.~~consumer ~~with~~market ahas already ~~similar~~begun ~~intention~~to asintegrate ~~Generation~~hemp ~~Hemp;~~products toand ~~consolidate~~products ~~and~~that ~~vertically~~contain ~~integrate~~hemp ~~along~~derivatives ~~the~~to ~~hemp~~existing ~~supply~~product ~~chain~~lines. The ~~through~~distribution ~~acquisitions.~~system ~~These~~is ~~companies~~constantly ~~have~~evolving ~~indicated~~as ~~their~~small ~~intention~~retailers, toretail ~~compete~~chains, inand ~~the~~big ~~hemp~~box ~~industry~~stores ~~and~~become ~~hemp-based~~increasingly ~~product~~educated ~~category.~~on ~~However,~~and familiar/comfortable ~~certain~~with ~~holding~~hemp ~~companies~~and ~~such~~its asderivatives. The ~~Acreage~~current ~~Holdings~~market ~~(domiciled~~is infocused ~~British~~on ~~Columbia)~~one ~~also~~of ~~include~~the ~~cannabis~~cannabinoids ~~companies~~derived infrom ~~their~~hemp ~~portfolio, whereas~~called ~~Generation~~cannabidiol ~~Hemp~~(“CBD”) and isconsumer ~~currently~~goods ~~hemp~~that ~~only~~contain CBD. WeAdditionally, ~~routinely~~consumer ~~evaluate~~awareness ~~internal~~followed ~~and~~by ~~external~~increased ~~opportunities~~demand continues to ~~optimize~~drive ~~value~~and ~~for~~even ~~shareholders~~force companies ~~through~~to ~~market~~make ~~research,~~room ~~strategic~~on ~~relationships~~their ~~and/or~~shelves ~~partnerships,~~for hemp and byproducts ~~asset~~with ~~acquisitions~~hemp derivatives. For ~~Based~~products ~~upon~~with ~~our~~hemp ~~management~~derivatives ~~team~~like ~~experience~~CBD, we ~~believe~~direct weto consumer ~~are~~Ecommerce ~~well-positioned~~through toonline ~~capitalize~~store insales remains the ~~growing~~main ~~hemp~~source ~~industry~~of ~~and~~revenue ~~hemp~~for consumer goods companies, accounting for reported percentages of approximately 70-~~based~~80% ~~product~~of ~~industry~~sales.

~~There are~~The ~~several~~Company ~~companies~~continues ~~developing~~to ~~hemp-based~~implement ~~products~~a ~~and~~plan ~~materials~~to ~~that will potentially displace existing products and materials sourced~~become ~~from~~more ~~less~~diversified ~~sustainable~~within orthe ~~less~~midstream ~~environmentally friendly sources~~market. Our ~~These~~marketing ~~hemp-based~~efforts ~~products~~began ~~are~~with ~~developing~~a ingrass ~~the~~roots ~~markets~~approach ofin ~~textiles, building~~order ~~materials,~~to ~~biofuels,~~meet aswith ~~food additives~~farmers, ~~skin care topicals and other therapeutics~~ growers, and ~~dietary~~seed ~~supplements.~~operations ~~Also, it is thought~~ that ~~cannabinoids~~would ~~derived~~benefit from ~~hemp~~midstream ~~can be used as therapeutics for a range of medical indications~~services. To ~~The~~supplement ~~hemp-derived cannabinoid therapeutic market currently includes extracts of~~ the ~~hemp~~grass ~~plant~~roots ~~in several formulations~~outreach, ~~including~~we ~~proprietary~~built ~~formulations~~our ~~from several companies.~~online ~~These~~web ~~formulations~~presence ~~include~~to ~~CBD~~reflect ~~and~~our ~~other~~desire ~~cannabinoid~~to ~~such as~~educate,” ~~CBG”,~~to ~~“CBC”,~~become ~~and~~a ~~“CBN”~~contributor orand apart ~~combination~~ of ~~several cannabinoids as~~ the ~~active~~hemp ~~ingredients. There are over one hundred different cannabinoids~~community, ~~therefore~~and ~~the~~also ~~market potential is only beginning~~ to beact ~~realized.~~as ~~The~~a ~~therapeutics~~pioneer ~~and supplement market are flooded with competition for hemp-based cannabinoid therapeutics.~~company ~~There~~to ~~are~~connect ~~also~~investors ~~companies that are using hemp-based cannabinoids as active ingredients~~ in ~~pharmaceutical~~the ~~formulations~~U.S. ~~Certain~~public ~~companies such~~markets asto GWa ~~Pharmaceuticals~~hemp ~~plc~~education ~~have focused on plant-based CBD formulations; while other companies, such as Zynerba Pharmaceuticals Inc.~~ and ~~Insys~~platform ~~Therapeutics~~that ~~Inc.,~~is ~~have~~dually ~~focused on synthetic CBD formulations~~informed.

~~Our~~We maintain and update our website and engage ~~Competitive~~on ~~Strengths~~social media platforms to market our ongoing hemp sector efforts. We use globally distributed YouTube video ad campaigns to increase our brand awareness and encourage markets and the investment community to learn more about the hemp space. These videos have been played on several business sites such as CNBC, MSNBC, Fox News, Fox Business, Yahoo Finance, among others. We have also begun to market a version of “Fireside Chats” from our Chairman and CEO to talk about various topics of interest in the hemp space. These video segments will post on our social media platforms and they will also be used to create awareness campaigns that should have a global outreach. In order to reach region specific growers/farmers in hemp, we have teed up direct mail marketing materials which prove effective for service markets within a specified radius. These materials will serve as invitations to the farmers and growers in areas that the midstream services which we are acquiring will reach. These are designed to add an identity to the midstream facility and provide an offer of help and partnership. As we continue to become involved with additional verticals in the hemp supply chain, we will expand and tailor these marketing and advertising efforts to the specific needs of each segment. To-date all marketing, ad creation, ad campaigns, and creative work has been done internally and with a minimal budget. The Company has consistently presented at, and/or exhibited in a number of industry tradeshows, and conferences and small cap investor conferences.

In 2021, we increased our marketing efforts by engaging several industry and investor media platforms by providing or collaborating on sponsored content in the form of articles, interviews, and podcasts in order to continue to educate the public and investors on the hemp industry and our company’s various products, services, and business plan. We have been featured on USA Today, Small Caps Daily, Benzinga, Reddit, and Cannabis Wealth Magazine. Gary C. Evans ~~believe~~has ~~that~~also webeen a guest on KRLD News Radio Dallas to discuss the Company, along with several podcasts and webinars. We have also continued to build out our social media presence on Instagram, TikTok, Facebook (Meta), Twitter, LinkedIn, and YouTube. We are attempting to post video and/or static posts at least twice per week and designing content based on statistical data of engagement metrics – what content is trending, what users are most responsive to, and what times receive the ~~following~~most ~~competitive~~user ~~strengths:~~reach and engagement. For reference, when comparing social media engagement from October 18, 2021 – December 28, 2021 to the same period for 2020, reach increased by 4,912% and engagement increased by 420% due to these efforts by management and the social media team.

●On ~~Experienced~~February ~~and Committed Management Team. Gary C. Evans~~17, ~~our CEO~~2022, ~~and~~we ~~other~~executed ~~anticipated members of our senior management team have substantial experience in all aspects of growing~~ a ~~public~~merchandise licensing ~~company~~agreement inwith aworld-renowned ~~highly competitive sector~~brand, ~~including~~Gas ~~acquisitions,~~Monkey ~~dispositions,~~Garage. ~~construction,~~The ~~development,~~Company ~~management,~~will ~~finance~~manufacture ~~and~~a ~~capital~~USA ~~markets.~~grown ~~Mr.~~hemp ~~Evans~~hurd ~~has~~spill ~~previously~~absorbent ~~been the Chairman~~ and market ~~CEO~~this ofnew ~~three~~product ~~different~~under ~~public companies that obtained financial success on~~ the ~~New~~Gas ~~York~~Monkey ~~Stock~~brand ~~Exchange.~~name ~~Additionally,~~to ~~he previously served as Chairman~~consumers, ~~CEO~~retailers, and ~~Lead~~distributors ~~Director~~as ofan aenvironmentally ~~NASDAQ listed company in the biopharmaceutical space for 24 years~~sustainable, ~~having just resigned in 2021. ● Focus on Consolidating Atomized Industry. Our focus on revenue generating and positive cash flow businesses is a key part of our growth strategy. Moreover~~USA made, weultra-absorbent ~~believe~~spill ~~the~~clean-up ~~beginning of an entire new industry creates numerous opportunities to evaluate and consolidate very fragmented businesses~~material. ~~Our~~This ~~ultimate goal of being a more fully integrated enterprise within the midstream sector~~ will ~~eventually~~be ~~give~~our ussecond ~~control~~environmentally ofsustainable ~~very~~consumer ~~profitable~~goods ~~values~~product ~~chain~~line ~~and~~made ~~separate us~~ from ~~most of our competition~~ U.S. ●grown ~~Demonstrated~~hemp ~~Investment and Capital Raising Acumen~~hurd. WeSpill ~~will~~absorbents ~~continue~~are totypically ~~utilize~~used ~~rigorous~~in ~~underwriting~~garages, ~~standards~~factories, ~~for~~or ~~evaluating~~industrial ~~acquisitions~~settings ~~and potential tenants~~ to ~~ensure~~quickly ~~that~~contain ~~they~~spills ~~meet~~of ~~our strategic~~ oil and ~~financial~~other ~~criteria~~liquids. ~~Our~~Spill ~~management~~absorbents ~~team’s~~are ~~extensive~~also ~~experience~~used ~~and~~at ~~relationships established in mergers and acquisitions over~~ the ~~past~~site 40of ~~years~~auto ~~and~~accidents ~~over 100 separate transactions should enable us~~ to ~~identify,~~quickly ~~negotiate~~contain ~~and~~leaks ~~close~~of onoil ~~acquisitions cost effectively, efficiently,~~ and ~~with~~other ~~shareholder~~fluids ~~interest~~due ~~first in mind~~to collisions.

~~Our~~Richard Rawlings, owner and founder of Gas Monkey ~~Growth~~Garage, ~~Strategy~~is the star of the international hit series’ “Fast N’ Loud” & “Garage Rehab” spanning 17+ seasons and 200+ episodes. Mr. Rawlings and Gas Monkey have migrated the show to an online platform and consistently produce new episodes that premiere every week on YouTube and Facebook. With his experience of owning and running a garage for over 18 years, Richard Rawlings found the sustainable spill absorbent to be of great significance.

Since the first harvests following the signing of the 2018 Farm Bill, the rush to capitalize on the hemp sector led to several pioneers launching a number of businesses within each vertical – many with very little capital resources available to them. Today:3

●There ~~The~~are ~~strong~~several ~~have~~types ~~survived~~of ●spill ~~Hemp/CBD~~absorbents ~~space~~with varying ischaracteristics. ~~ripe~~These ~~for~~are ~~consolidation~~in ●three ~~Time~~general ~~for~~categories ~~expansion~~– mineral based, animal or vegetable based, and ~~more~~synthetic ~~vertical~~or ~~integration~~organic polymers. ●The ~~Seasoned~~challenge ~~business~~in ~~professionals~~choosing ~~have~~an ~~now~~absorbent ~~begun~~is finding an effective absorbent that does not pose a threat to ~~enter~~health or the ~~space~~environment, whether that threat is posed when that material is procured or used. For example, a widely used spill absorbent material in products is Bentonite Clay. This is often a very dusty material and has warnings of containing unsafe levels of lead (FDA) and is associated with a number of health complaints in humans.

4The Company tested its U.S. grown and milled hemp hurd against currently used absorbents on the market and the findings showed it to have as effective or more effective absorbency and ability to contain spills.

~~Generation Hemp~~In ~~has~~February ~~taken~~of a2023, ~~boots-on-~~the~~-ground~~ ~~approach~~Company tobegan ~~its~~working with ~~analysis~~iHeart Media, one of the ~~overall~~most ~~industry~~influential media companies with several different marketing and ~~due~~advertising ~~diligence~~channels on(radio, ~~specific~~television, digital, ~~businesses~~etc.). WeiHeart ~~believe there~~Media ~~are~~agreed ~~currently~~to ~~significant~~drastically ~~opportunities~~reduce their typical budget requirements in order to ~~grow~~foster a ~~vertically~~growth ~~integrated~~relationship ~~hemp~~with the ~~business~~Company. byThe ~~executing~~first ~~the~~campaigns, ~~following~~called ~~elements~~OTT of(Over-The-Top), ~~our~~are targeting specific consumers, and will air before streaming television ~~strategy:~~and film content played on various internet streaming digital platforms. Initially, these campaigns are advertising the Company’s consumer goods products.

~~● rigorous, hands-on vetting process to enable our management to meet with target companies’ teams all across the country~~Competition

●The ~~site~~hemp ~~tours~~industry and hemp-based consumer product industry is highly competitive and fragmented in its nascency with numerous companies, consisting of publicly (mostly Canadian) and privately-owned companies. There are also large, well-funded companies beginning to emerge in the U.S. with a similar intention as the Company; to consolidate and vertically integrate along the hemp supply chain through acquisitions. These companies have indicated their intention to compete in the hemp industry and hemp-based product category. However, certain holding companies such as Acreage Holdings (domiciled in British Columbia) also include cannabis companies in their portfolio, whereas the Company is currently hemp only. We routinely evaluate internal and external opportunities to optimize value for shareholders through market research, strategic relationships and/or partnerships, and by asset acquisitions. Based upon our management team experience, we believe we are well-positioned to capitalize in the growing hemp industry and hemp-based product industry.

●There ~~verification~~are several companies developing hemp-based products and materials that will potentially displace existing products and materials sourced from less sustainable or less environmentally friendly sources. These hemp-based products are developing in the markets of ~~operations~~textiles, building materials, biofuels, as food additives, skin care topicals and other therapeutics, and dietary supplements. Also, it is thought that cannabinoids derived from hemp can be used as therapeutics for a range of medical indications. The hemp-derived cannabinoid therapeutic market currently includes extracts of the hemp plant in several formulations, including proprietary formulations from several companies. These formulations include CBD and other cannabinoid such as,” CBG”, “CBC”, and “CBN” or a combination of several cannabinoids as the active ingredients. There are over one hundred different cannabinoids, therefore the market potential is only beginning to be realized. The therapeutics and supplement market are flooded with competition for hemp-based cannabinoid therapeutics. There are also companies that are using hemp-based cannabinoids as active ingredients in pharmaceutical formulations.

●Bitcoin mining is an increasingly competitive industry comprised of companies and organizations of varying scale and sophistication. There has been a significant increase in ~~person~~the ~~discussions~~number of commercial bitcoin miners attempting to expand and scale their mining operations, which in turn has contributed to increasing the global network’s total hash power. As more hashing capability is added to the bitcoin network, the revenue generating potential of the Company’s miners could be negatively affected. Additionally, as more bitcoin miners enter the industry, The Company may experience additional pressure on ~~operating~~profitability ~~activities~~and ability to scale operations, due to greater competition for access to miners, mining locations, and infrastructure components.

●Our ~~validation~~Competitive ~~of historical financial results~~Strengths

●We ~~stress~~believe ~~testing~~that ofwe ~~projections~~have the following competitive strengths:

~~Intellectual Property~~● Experienced and Committed Management Team. Gary C. Evans, our CEO, and other anticipated members of our senior management team have substantial experience in all aspects of growing a public company in a highly competitive sector, including acquisitions, dispositions, construction, development, management, finance and capital markets. Mr. Evans has previously been the Chairman and CEO of three different public companies that obtained financial success on the New York Stock Exchange. Additionally, he previously served as Chairman, CEO, and Lead Director of a NASDAQ listed company in the biopharmaceutical space for 24 years, having just resigned in 2021. ● Focus on Consolidating Atomized Industry. Our focus on revenue generating and positive cash flow businesses is a key part of our growth strategy. Moreover, we believe the beginning of an entire new industry creates numerous opportunities to evaluate and consolidate very fragmented businesses. Our ultimate goal of being a more fully integrated enterprise within the midstream sector will eventually give us control of very profitable values chain and separate us from most of our competition. ● Demonstrated Investment and Capital Raising Acumen. We will continue to utilize rigorous underwriting standards for evaluating acquisitions and potential tenants to ensure that they meet our strategic and financial criteria. Our management team’s extensive experience and relationships established in mergers and acquisitions over the past 40 years and over 100 separate transactions should enable us to identify, negotiate and close on acquisitions cost effectively, efficiently, and with shareholder interest first in mind.

As a company within the hemp industry, one of the fastest growing new industries in the United States, our current initial effort is to protect and distinguish our company and brand identity amidst other entities currently operating within and entering the space.4

~~Governmental Regulation~~Intellectual Property

~~We are~~As ~~subject~~a tocompany ~~local~~within ~~and~~the ~~federal~~hemp ~~laws~~industry, in our ~~operating~~current effort ~~jurisdictions.~~is Weto ~~will~~protect ~~hold required licenses for product production~~ and ~~distribution to~~distinguish ~~the extent that~~ our ~~business~~company ~~requires~~ and ~~will~~brand ~~monitor~~identity ~~changes~~amidst inother ~~laws,~~entities ~~regulations,~~currently ~~treaties~~operating within and ~~agreements~~entering the space.

The ~~Agriculture~~ ~~Improvement~~Company ~~Act~~uses ofspecific ~~2018~~hardware ~~known~~and assoftware for ~~the~~its ~~“2018~~bitcoin ~~Farm~~mining ~~Bill,”~~operations. isIn ~~United~~certain ~~States~~cases, ~~federal~~source ~~legislation~~code ~~signed~~and ~~into~~other ~~law~~software ~~on December~~assets ~~20,~~may ~~2018,~~be ~~which~~subject ~~provides~~to ~~much~~an ofopen-source ~~the~~license ~~legal~~due to ~~framework for~~ the ~~hemp-based~~fact ~~CBD~~that ~~product~~the ~~category.~~majority ~~The~~of ~~2018~~the ~~Farm~~technology ~~Bill~~in ~~permanently removed~~the ~~“hemp”~~blockchain ~~from~~and ~~the~~cryptocurrency ~~purview~~sectors ofis ~~the~~open ~~Controlled~~source ~~Substances~~For ~~Act~~these works, ~~and~~we ~~accordingly,~~adhere to the ~~Drug~~terms ~~Enforcement~~of ~~Administration~~any ~~(“DEA”) no~~license ~~longer~~agreements ~~has~~that ~~any~~may ~~claim~~be toin ~~interfere~~place. ~~with~~The ~~the~~Company ~~interstate~~does ~~commerce~~not ofcurrently ~~hemp~~own, ~~products.~~and ~~Some~~does ofnot ~~the~~have ~~immediate~~any ~~impact~~current ~~from~~plans ~~this legislation~~to ~~includes~~seek, ~~the~~any ~~ability~~patents ~~for~~in ~~farmers~~connection towith ~~access~~its ~~crop~~existing ~~insurance~~ and ~~U.S.~~planned ~~Department~~blockchain ofand ~~Agriculture~~cryptocurrency ~~programs~~related ~~for certification and competitive grants~~operations. ~~While~~The ~~the~~Company ~~DEA~~expects isto rely ~~now~~upon ~~officially~~trade ~~not~~secrets, ~~involved~~trademarks, inservice ~~hemp regulation~~marks, ~~the~~trade ~~FDA~~names, ~~retains~~copyrights ~~its~~and ~~authority~~other tointellectual ~~regulate~~property ~~ingestible~~rights and ~~topical~~to license the ~~products,~~use ~~including~~of ~~those~~intellectual ~~that~~property ~~contain~~rights ~~hemp~~owned and ~~hemp~~controlled ~~extracts~~by ~~such as CBD~~others.

~~A range~~Governmental of federal regulations govern any potential product development, manufacturing, distribution, sales and marketing, including the Dietary Supplement Health and Education Act of 1994 (the “DSHEA”). Under DSHEA, supplements are effectively regulated by the FDA for Good Manufacturing Practices under 21 CFR Part 111. DSHEA defines a “dietary supplement” as a product intended to supplement the diet that contains one or more of the following: (a) a vitamin; (b) a mineral; (c) an herb or other botanical; (d) an amino acid; (e) a dietary substance for use by man to supplement the diet by increasing the total dietary intake; or (f) a concentrate, metabolite, constituent, extract, or combination of any ingredient described in clause (a) through (e). Thus, the law permits a wide range of dietary ingredients in dietary supplements, including CBD which is an extract of a botanical (Cannabis sativa L. plant). CBD also falls under clause (e) as it is a dietary substance for use by man to supplement the diet by increasing the total dietary intake.Regulation

~~Markets and~~Hemp ~~Distribution~~Industry ~~Methods~~

~~The market,~~We ~~customers and distribution methods for hemp-based products~~ are ~~large~~subject ~~and diverse. These markets range from hemp-based bio plastics~~ to ~~textiles.~~local ~~This is an ever-evolving distribution system that today includes early adopter retailers~~ and ~~ecommerce~~federal ~~entities,~~laws ~~and~~in ~~product~~our ~~development~~operating ~~companies~~jurisdictions. We ~~believe~~will ~~that~~hold asrequired ~~awareness~~licenses ~~grows~~ for ~~the~~product ~~“green”,~~production ~~environmentally-friendly~~and ~~products~~distribution ~~derived~~to ~~from hemp/cannabis,~~ the ~~consumer~~extent ~~market~~that ~~will~~our ~~continue~~business torequires and ~~adapt~~will ~~its~~monitor ~~current~~changes ~~product lines to integrate them with hemp-based additives or replace harmful components~~ in ~~their~~laws, ~~existing~~regulations, ~~products~~treaties ~~with~~and ~~certain components of hemp~~agreements.

~~Environmental~~The Agriculture Improvement Act of 2018 known ~~Matters~~as the “2018 Farm Bill,” is United States federal legislation signed into law on December 20, 2018, which provides much of the legal framework for the hemp-based CBD product category. The 2018 Farm Bill permanently removed “hemp” from the purview of the Controlled Substances Act, and accordingly, the Drug Enforcement Administration (“DEA”) no longer has any claim to interfere with the interstate commerce of hemp products. Some of the immediate impact from this legislation includes the ability for farmers to access crop insurance and U.S. Department of Agriculture programs for certification and competitive grants. While the DEA is now officially not involved in hemp regulation, the FDA retains its authority to regulate ingestible and topical products, including those that contain hemp and hemp extracts such as CBD.

~~Compliance with~~A range of federal regulations govern any potential product development, ~~state~~manufacturing, ~~and~~distribution, ~~local~~sales ~~requirements~~and ~~regulating~~marketing, including the ~~discharge~~Dietary ofSupplement ~~materials~~Health ~~into~~and Education Act of 1994 (the ~~environment~~“DSHEA”). Under DSHEA, orsupplements ~~otherwise~~are ~~relating~~effectively toregulated by the ~~protection~~FDA for Good Manufacturing Practices under 21 CFR Part 111. DSHEA defines a “dietary supplement” as a product intended to supplement the diet that contains one or more of the following: ~~environment,~~(a) ~~have~~a ~~not~~vitamin; ~~had,~~(b) ~~nor~~a ~~are~~mineral; ~~they~~(c) ~~expected~~an herb or other botanical; (d) an amino acid; (e) a dietary substance for use by man to supplement ~~have~~the diet by increasing the total dietary intake; or (f) a concentrate, metabolite, constituent, extract, or combination of any ~~material~~ingredient ~~effect~~described onin ~~the~~clause ~~capital~~(a) ~~expenditures~~through (e). Thus, ~~earnings~~the orlaw ~~competitive~~permits a wide range of dietary ingredients in dietary supplements, ~~position~~including CBD which is an extract of a botanical (Cannabis sativa L. plant). CBD also falls under clause (e) as it is a dietary substance for use by man to supplement the ~~Company~~diet by increasing the total dietary intake.

~~Employees~~Blockchain and Cryptomining

~~We had~~Government 11regulation ~~employees as~~ of ~~December 31,~~blockchain ~~2021,~~and ~~including~~cryptocurrency ~~our~~mining ~~named~~industries is ~~executive~~being ~~officers.~~actively ~~None~~considered ofby ~~our~~the ~~employees~~United ~~are~~States ~~covered~~federal bygovernment ~~collective bargaining~~via ~~agreements,~~several agencies and weregulatory ~~have~~bodies ~~not~~as ~~experienced~~well ~~any~~as ~~strikes~~similar orentities in ~~work~~other ~~stoppages~~countries. ~~related~~State government regulations also may apply to ~~labor~~the ~~relation~~Company’s ~~issues.~~activities Weand ~~believe~~other weactivities ~~have good~~in ~~relations~~which ~~with~~the ~~our~~Company participates ~~employees.~~or Wemay ~~also~~participate ~~utilize~~in ~~seasonal~~the ~~part-time~~future. ~~employees~~Other ~~during~~regulatory ~~peak~~bodies ~~processing~~are ~~season~~governmental or semi-governmental and ~~contractors~~have toshown ~~provide~~an interest ~~certain~~in ~~specialized~~regulating ~~skills~~or ~~and~~investigating ~~expertise~~companies ~~that~~engaged ~~may~~in bethe ~~required~~blockchain ~~from~~or ~~time~~cryptocurrency tomining ~~time~~business.

5Businesses that are engaged in the transmission and custody of bitcoin and other digital assets, including brokers and custodians, can be subject to the regulations of the U.S. Department of the Treasury (the “Treasury”) as money services businesses as well as state money transmitter licensing requirements. Bitcoin and other digital assets are subject to anti-fraud regulations under federal and state commodity laws, and digital asset derivative instruments are substantively regulated by the Commodity Futures Trading Commission. Certain jurisdictions, including, among others, the State of New York and a number of countries outside the United States, have developed regulatory requirements specifically for digital assets and companies that transact in them.

~~Item 1A. Risk Factors~~5

~~Our business~~Regulations ~~involves~~may ~~certain~~change ~~risks~~substantially ~~and~~in ~~uncertainties.~~the ~~The~~future, ~~following~~and it is apresently not ~~description~~possible ofto ~~significant~~know ~~risks~~how ~~that~~regulations ~~might~~will ~~cause~~apply ~~our~~to ~~future~~the ~~financial condition~~Company’s business or ~~results~~when ofthey ~~operations~~will tobecome ~~differ~~effective. ~~materially~~As ~~from~~the ~~those~~regulatory and ~~expected.~~legal Inenvironments ~~addition~~evolve, The Company may become subject to ~~the~~new ~~risks~~laws and ~~uncertainties~~further ~~described~~regulation ~~below~~by the SEC and other agencies, we which may ~~face~~affect ~~other~~its ~~risks~~mining and ~~uncertainties~~other activities. For instance, ~~some~~various ofbills ~~which~~have ~~may~~been beproposed ~~unknown~~in tothe usU.S. ~~and~~Congress ~~some~~related ofto ~~which~~The weCompany’s business, which may ~~deem~~be ~~immaterial.~~adopted Ifand ~~one~~have oran ~~more of~~impact ~~these~~on ~~risks~~the orCompany. ~~uncertainties~~See ~~occur,~~“Risk ~~our~~Factors” ~~business,~~for ~~financial~~additional ~~condition~~discussion orregarding ~~results~~the Company’s ofbelief ~~operations~~about ~~may~~the bepotential ~~materially~~risks that existing and ~~adversely~~future ~~affected~~regulations pose to its business.

~~Risks~~On March 2, 2022, the United States announced plans to establish a ~~Related~~unified federal regulatory regime for cryptocurrency, and a group of United States Senators sent a letter to ~~Our~~the ~~Business~~United States Treasury Department asking Treasury Secretary Yellen to investigate Treasury’s ability to monitor and restrict the use of cryptocurrencies to evade sanctions imposed by the United States.

~~There~~In September 2022, the White House issued a report regarding the Climate isand ~~substantial~~Energy ~~doubt~~Implications of Crypto-Assets in the United States. The report states that wethe ~~will~~Department beof ~~able~~Energy toand ~~continue~~Environmental asProtection Agency should initiate a ~~going~~process ~~concern~~to solicit data and develop environmental performance and energy conservation standards for crypto-asset technologies, including mining equipment. Should such measures prove ineffective at achieving the Administration’s environmental goals, the report calls for the Administration to explore executive actions and legislation to limit or eliminate the use of high energy intensity consensus mechanisms for crypto-asset mining.

~~Our independent~~We ~~registered~~are ~~public~~unable ~~accounting~~to ~~firm’s~~predict ~~auditors’~~the ~~report~~impact ~~includes~~that anany ~~explanatory~~new ~~paragraph~~standards, ~~stating that there is~~legislation, ~~substantial~~or ~~doubt~~regulations ~~about~~may ~~our ability to continue as a going concern. We~~ have ~~had~~on ~~substantial~~our ~~losses~~business ~~since~~at ~~inception and as of December 31, 2021, and~~ the ~~date~~time of filing this ~~report~~Annual ~~we have minimal cash reserves~~Report. ~~While~~We wecontinue ~~are beginning~~ to ~~generate~~monitor ~~increasing~~and ~~revenue~~proactively ~~and~~engage ain ~~positive~~dialogue ~~cash~~on ~~flow,~~regulatory ~~our ability to build significant cash reserves~~ and ~~continue~~legislative asmatters arelated ~~going concern over the long term remains unproven. In the event that we are forced~~ to ~~reduce operations or seriously curtail~~ our ~~business, an investor will lose all money invested~~industry.

~~We have~~Further, ain ~~history~~December 2022 the SEC’s Division of ~~significant~~Corporation ~~losses,~~Finance issued ~~which~~guidance weadvising ~~expect~~companies to ~~continue~~disclose exposure and risk to the cryptocurrency market. While the focus is on digital asset managers and exchanges, and wenot bitcoin miners, the failure of such large asset managers and exchanges may ~~never~~create ~~achieve~~increased ~~nor~~price ~~maintain~~volatility ~~profitability~~of bitcoin. the Company does not store our bitcoin on such exchanges; however, we may be impacted by such failures.

~~We have~~In ~~incurred~~January ~~significant~~2023, ~~net~~the ~~losses~~Federal ~~since~~Reserve, ~~our~~Office ~~formation~~of ~~and may continue to incur net losses for~~ the ~~foreseeable~~Comptroller ~~future as we complete~~of ~~our~~the ~~acquisition~~Currency, ~~efforts.~~and WeFederal ~~incurred~~Deposit ~~net~~Insurance ~~losses~~Corporation ofissued ~~$9.8~~a ~~million~~joint ~~and~~statement ~~$1.6~~discouraging ~~million~~banks ~~for~~from ~~the~~doing ~~years~~business ~~ended~~with ~~December~~clients ~~31,~~in crypto-asset ~~2021~~industries. ~~and~~In ~~2020,~~January ~~respectively. To date~~2023, ~~we have not generated any significant revenues from~~ the ~~hemp~~Federal ~~business.~~Reserve Ifalso weissued ~~are~~a ~~unsuccessful~~policy instatement ~~implementing~~broadening ~~our~~its ~~strategic plan~~authority weto ~~may~~cover ~~never become profitable~~state-chartered banks.

~~Business interruptions~~Also ~~resulting~~in ~~from~~January 2023, the ~~coronavirus~~House ~~disease~~of ~~(COVID-19)~~Representatives announced ~~outbreak~~its orfirst ~~similar~~ever ~~public~~Financial ~~health~~Services ~~crises~~Subcommittee ~~could~~on ~~cause~~Digital Assets and the intention to develop a ~~disruption~~regulatory of framework for the digital ~~development~~asset industry. The bipartisan leadership of ~~our~~the ~~product~~Senate ~~candidates~~Banking ~~and~~Committee ~~adversely~~announced ~~impact~~that ~~our~~goal ~~business~~as well.

~~In March~~As ~~2020,~~ the ~~World~~regulatory ~~Health~~and ~~Organization~~legal ~~declared~~environment ~~the~~evolves, we ~~novel~~may ~~coronavirus~~become ~~disease~~subject ~~(COVID-19)~~to ~~outbreak~~new alaws, ~~global~~such ~~pandemic.~~as Tofurther ~~limit~~regulation by the ~~spread~~ ofSEC ~~COVID-19,~~and ~~governments~~other ~~have~~agencies, ~~taken~~which ~~various~~may ~~actions~~affect ~~including~~our ~~the~~mining ~~issuance of stay-at-home orders~~ and ~~physical~~other ~~distancing guidelines~~activities. ~~Accordingly,~~For ~~businesses~~additional ~~have~~discussion ~~adjusted,~~regarding ~~reduced~~our orbelief ~~suspended~~about ~~operating~~the ~~activities.~~potential Werisks ~~may~~existing ~~experience~~and ~~disruptions~~future asregulation apose ~~result~~to ofour ~~COVID-19 that~~business, ~~could~~see ~~severely~~Part I, ~~impact~~Item ~~our~~1A. ~~business~~“Risk ~~and~~Factors” ~~planned~~of ~~acquisition~~this ~~strategy,~~Annual ~~including:~~Report.

●Additionally, ~~challenges~~we ~~related~~are subject to ~~ongoing~~numerous federal, state and ~~increased~~local ~~operational~~environmental ~~expenses~~laws ~~related~~and regulations. Numerous governmental agencies, such as the U.S. Environmental Protection Agency and analogous state and provincial agencies issue regulations to implement and enforce these laws, which often require stringent and costly compliance measures. These laws and regulations may, among other things, require the ~~COVID-19~~acquisition ~~pandemic~~of permits; govern the amounts and types of substances that may be released into the environment in connection with our operations; restrict the way we handle or dispose of our materials and wastes; or require investigatory and remedial actions. Failure to comply with these laws and regulations may result in the assessment of substantial administrative, civil and criminal penalties, the imposition of investigatory, remedial or corrective action obligations, or the possible issuance of injunctions limiting or prohibiting our activities. In addition, some laws and regulations relating to the protection of the environment may, in certain circumstances, impose liability for environmental damages and cleanup costs without regard to negligence or fault. Complying with these regulatory requirements may increase our cost of doing business and consequently affect our profitability. Moreover, environmental laws and regulations have been subject to frequent changes over the years, and the imposition of more stringent requirements could have a material adverse effect upon our capital expenditures, earnings or our competitive position. We believe that our existing environmental control procedures are adequate and we have no current plans for substantial capital expenditures in this area that would materially and adversely affect our business, financial condition or results of operations.

~~● delays, difficulties or increased costs to comply with COVID-19 protocols;~~6

●Environmental limitations in resources that would otherwise be focused on the conduct of our business, including because of sickness or the desire to avoid contact with large groups of people or as a result of government-imposed “Stay-at-Home” orders or similar working restrictions;Matters

●Compliance ~~delays~~with infederal, ~~receiving~~state and local requirements regulating the ~~supplies~~discharge ~~and~~of materials ~~needed~~into the environment, or otherwise relating to ~~operate~~the ~~our~~protection ~~business;~~of the environment, have not had, nor are they expected to have, any material effect on the capital expenditures, earnings or competitive position of the Company.

~~● interruption in global shipping that may affect the transport of materials or our supply chain;~~Employees

●We ~~changes~~had in11 ~~regulations~~employees as ~~part~~of December 31, 2022, including our named executive officers. None of aour ~~response~~employees toare ~~the~~covered ~~COVID-19~~by ~~pandemic~~collective ~~which~~bargaining ~~may~~agreements, ~~require~~and uswe have not experienced any strikes or work stoppages related to ~~change~~labor ~~the~~relation ~~ways~~issues. inWe ~~which~~believe we have good relations with our ~~business~~employees. ~~may~~We bealso ~~conducted,~~utilize seasonal orpart-time ~~which~~employees during peak hemp processing season and contractors to provide certain specialized skills and expertise that may ~~result~~be inrequired ~~unexpected~~from ~~costs;~~time to time.

●Where ~~delays~~You inCan ~~necessary~~Find ~~interactions~~More ~~with regulators and other important governmental agencies and contractors due to limitations in employee resources or forced furlough of personnel; and~~Information

●We ~~increased~~file ~~competition~~annual, ~~for~~quarterly ~~suppliers~~and current reports, proxy statements and ~~vendors~~other information required by the Securities Exchange Act of 1934, as amended (the “Exchange Act”), with the Securities and Exchange Commission (the “SEC”). You may read and copy any document we file with the SEC at the SEC’s public reference room located at 100 F Street, N.E., Washington, D.C. 20549, U.S.A. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Our SEC filings are also available to the public from the SEC’s internet site at http://www.sec.gov.

~~We will~~On ~~continue~~our toInternet ~~assess~~website, ~~the~~http://www.genhempinc.com, we ~~impact~~post ~~that~~the ~~COVID-19~~following ~~may~~recent ~~have~~filings onas ~~our~~soon ~~ability~~as toreasonably ~~effectively~~practicable ~~conduct~~after ~~our~~they ~~business~~are ~~operations~~electronically asfiled ~~planned~~with ~~and there~~or ~~can~~furnished beto nothe ~~assurance~~SEC: our ~~that~~annual wereports ~~will~~on beForm ~~able~~10-K, toour ~~avoid~~quarterly areports ~~material~~on ~~impact~~Form on10-Q, our ~~business~~current ~~from~~reports ~~the~~on ~~spread~~Form ~~of COVID~~8-~~19 or its consequences~~K, ~~including~~ ~~disruption to our business~~ and ~~downturns~~any inamendments ~~business~~to ~~sentiment~~those ~~generally~~reports filed or infurnished ~~our~~pursuant ~~industry.~~to ~~Should~~Section ~~COVID-19~~13(a) ~~cases~~or in15(d) ~~USA~~of ~~increase,~~ the ~~country~~Exchange ~~or states may institute stricter social distancing protocols~~Act.

~~The global~~Item ~~outbreak of COVID-19 continues to rapidly evolve~~1A. ~~The~~Risk extent to which the COVID-19 pandemic impacts our business will depend on future developments such as the rate of the spread of the disease, travel restrictions and social distancing in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease and to address its impact, including on financial markets or otherwise. Further, a lack of coordinated response on risk mitigation and vaccination deployment with respect to the COVID-19 pandemic on a local or federal level could result in significant increases to the duration and severity of the pandemic in the United States as compared to the rest of the world and could have a corresponding negative impact on our business. While the extent of the impact of the current COVID-19 pandemic on our business and financial results is uncertain, a continued and prolonged public health crisis such as the COVID-19 pandemic could have a material negative impact on our business, financial condition and operating results.Factors

ToOur business involves certain risks and uncertainties. ~~the~~The ~~extent~~following ~~the~~is ~~COVID-19~~a ~~pandemic~~description ~~adversely~~of ~~affects~~significant risks that might cause our ~~business,~~future financial condition or results of operations to differ materially from those expected. In addition to the risks and ~~operating~~uncertainties ~~results~~described below, itwe may ~~also~~face ~~have~~other ~~the~~risks ~~effect~~and uncertainties, some of ~~heightening~~which ~~many~~may be unknown to us and some of ~~the~~which we may deem immaterial. If one or more of these risks ~~described~~or inuncertainties ~~this~~occur, ~~“Risk~~our business, ~~Factors”~~financial ~~section~~condition or results of operations may be materially and adversely affected.

~~Unfavorable global~~Risks ~~economic~~Related orto ~~political~~Our ~~conditions could adversely affect our business, financial condition or results of operations.~~Business

~~Our results~~There ofis ~~operations~~substantial ~~could~~doubt bethat ~~adversely~~we ~~affected~~will bybe ~~general~~able conditions in the global economy and in the global financial markets. A global financial crisis or a global or regional political disruption could cause extreme volatility in the capital and credit markets. For example, outbreaks of epidemic, pandemic, or contagious diseases, such as the recent COVID-19 outbreak, could disrupt our business. Business disruptions could include disruptions to ~~the~~continue ~~productivity of our employees working remotely and restrictions on their travel may hinder their ability to meet with potential customers and close transactions,~~ as ~~well as temporary closures of the facilities of~~ ~~suppliers or contract growers as we try to develop our supply chain. In addition, the COVID-19 outbreak may result in~~ a ~~severe~~going ~~economic downturn and has already significantly affected the financial markets of many countries~~concern. A severe or prolonged economic downturn or political disruption could result in a variety of risks to our business, including our ability to raise capital when needed on acceptable terms, if at all. A weak or declining economy or political disruption could also strain our operations, possibly resulting in a future supply disruption, or cause our future customers to delay making payments for our services. Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the political or economic climate and financial market conditions could adversely impact our business.

WeOur independent registered public accounting firm’s ~~have~~auditors’ report includes an explanatory paragraph stating that there is substantial doubt about our ability to continue as a ~~limited~~going concern. ~~operating~~We ~~history~~have had substantial losses since inception and ~~operate~~as ~~under~~of ~~the~~December ~~professional~~31, ~~guidance~~2022, and the date of this report we have minimal cash reserves. While we are beginning to generate increasing revenue and a positive cash flow, our ~~Chairman~~ability to build significant cash reserves and ~~CEO~~continue as a going concern over the long term remains unproven. In the event that we are forced to reduce operations or seriously curtail our business, an investor will lose all money invested.

~~Our ability~~We tohave ~~achieve~~a ~~consistent~~history ~~cash flow and profitability depends upon the continued service~~ of ~~Gary~~significant C.losses, ~~Evans.~~which ~~Mr.~~we ~~Evans~~expect isto ~~our Chairman~~continue, and ~~CEO,~~we ~~largest~~may ~~shareholder,~~never ~~and~~achieve ~~the~~nor ~~primary~~maintain ~~management level executive~~profitability.

~~Our~~We have incurred significant net losses since ~~business~~our ~~plan~~formation ~~provides~~and ~~that~~may wecontinue ~~will~~to ~~grow~~incur net losses for the ~~Company’s~~foreseeable ~~asset~~future ~~base~~as we complete our acquisition efforts. We incurred net losses of $7.0 million and ~~revenues~~$9.8 ~~rapidly~~million for the years ended December 31, 2022 and ~~ultimately~~2021, ~~deliver~~respectively. aTo ~~positive~~date, ~~cash~~we ~~flow~~have not generated any ~~generating~~significant ~~company~~revenues from the hemp business. If we are unsuccessful in implementing our strategic plan we may never become profitable.

~~We may~~Business ~~not~~interruptions beresulting ~~able~~from tothe ~~generate~~coronavirus ~~predictable~~disease (COVID-19) ~~and~~outbreak ~~continuous~~or ~~revenue~~similar inpublic ~~the~~health ~~future.~~crises ~~Further,~~could ~~there~~cause isa nodisruption ~~assurance~~of ~~that~~the wedevelopment ~~will~~of ~~ever~~our ~~grow~~product ~~operations in~~candidates ~~the~~and ~~manner~~adversely impact ~~contemplated~~our business.

~~We may~~In ~~incur~~March ~~significant~~2020, ~~operating~~the ~~losses~~World inHealth Organization declared the ~~future,~~novel ~~due~~coronavirus todisease ~~the~~(COVID-19) ~~expansion~~outbreak ofa ~~our~~global ~~operations~~pandemic. orTo ~~other~~limit ~~factors.~~the ~~There~~spread isof noCOVID-19, ~~assurance that~~governments wehave ~~can~~taken ~~expand~~various ~~under~~actions including ~~terms~~the ~~that~~issuance ~~permit~~of ~~profitable~~stay-at-home ~~operations~~orders ~~over~~and ~~the~~physical ~~long~~distancing ~~term~~guidelines. ~~Failure~~Accordingly, tobusinesses ~~generate~~have ~~sufficient~~adjusted, ~~revenue~~reduced toor ~~pay expenses~~suspended asoperating ~~they~~activities. ~~come~~We ~~due~~ may ~~make~~experience usdisruptions ~~unable to continue~~ as a ~~going~~result ~~concern~~of ~~and~~COVID-19 ~~result~~that incould ~~the~~severely ~~failure~~impact of our ~~company~~business and ~~the~~planned ~~complete loss of~~acquisition ~~any~~strategy, ~~money invested to purchase our shares.~~including:

7● challenges related to ongoing and increased operational expenses related to the COVID-19 pandemic;

~~We may~~● bedelays, ~~unable~~difficulties toor ~~manage~~increased ~~our~~costs ~~growth~~to orcomply ~~implement~~with ~~our~~COVID-19 ~~expansion strategy.~~protocols;

~~As a~~● ~~public~~limitations ~~company,~~in ~~our~~resources ~~expenses~~that ~~include,~~would ~~but~~otherwise ~~are~~be ~~not~~focused ~~limited~~on ~~to,~~the ~~annual~~conduct ~~audits,~~of ~~legal~~our ~~costs~~business, ~~SEC~~including ~~reporting~~because ~~costs, costs~~ of asickness ~~transfer agent~~or ~~and~~ the ~~costs~~desire ~~associated with fees and compliance. Further, our management will need~~ to ~~invest~~avoid ~~significant~~contact ~~time and energy to stay current~~ with ~~the~~large ~~public~~groups ~~company responsibilities~~ of ~~our~~people ~~business~~or ~~and~~as ~~may~~a ~~from~~result ~~time~~of togovernment-imposed ~~time~~“Stay-at-Home” ~~have~~orders ~~diminished~~or ~~time~~similar ~~available~~working ~~to apply to other tasks necessary to our survival and growth.~~restrictions;

~~It is~~● ~~therefore~~delays ~~possible~~in ~~that~~receiving the ~~financial~~supplies and ~~time~~materials ~~burdens~~needed ~~of operating as a public company will cause us~~ to ~~fail~~operate ~~to achieve profitability. If we exhaust~~ our ~~funds, our~~ business ~~will fail and our investors will lose all money invested in our stock.~~;

~~If we~~● ~~fail~~interruption toin ~~pay~~global ~~public~~shipping ~~company~~that ~~costs,~~may asaffect ~~such~~the ~~costs~~transport ~~are~~of ~~incurred;~~materials weor ~~could become delinquent in~~ our ~~reporting~~supply ~~obligations and face the delisting of our shares.~~chain;

~~It is~~● ~~essential~~changes ~~that~~in weregulations ~~grow~~as ~~our~~part ~~overall~~of ~~business,~~a ~~achieve~~response ~~significant~~to ~~profits~~the ~~and~~COVID-19 ~~maintain~~pandemic ~~adequate~~which ~~cash~~may ~~flow~~require inus ~~order~~ to ~~pay~~change the ~~cost of~~ways ~~remaining~~in ~~a public entity~~ which ~~includes~~our ~~but~~business ismay ~~not~~be ~~limited~~conducted, ~~the~~or ~~costs~~which ofmay ~~remaining~~result ~~current~~in ~~with~~unexpected ~~SEC reporting obligations.~~costs;

~~The issuance~~● ofdelays ~~additional~~in ~~shares~~necessary ofinteractions ~~our~~with ~~common~~regulators ~~stock~~and ~~may~~other beimportant ~~necessary~~governmental ~~for~~agencies ~~the~~and ~~implementation~~contractors due to limitations in employee resources or forced furlough of ~~our growth~~personnel; ~~strategy.~~and

~~Limited private~~● ~~placement~~increased ofcompetition ~~restricted~~for ~~shares~~suppliers ~~of our common stock has been completed from time to time when deemed necessary. Cash generated in prior years was used to acquire cannabis zoned real property, finance our office space~~ and ~~provide working capital~~vendors. ~~Issuance of any additional securities pursuant to future fundraising activities undertaken may significantly dilute the ownership of existing shareholders and may reduce the price of our common stock.~~

We will continue to assess the impact that COVID-19 ~~acquired,~~may ~~improved~~have ~~and~~on ~~leased~~our ability to effectively conduct our ~~Denver~~business ~~warehouse~~operations as planned and there can be no assurance that we will be able to avoid a ~~licensed~~material ~~third~~impact ~~party~~on ~~hemp~~our ~~seed~~business ~~grower.~~from ~~Rental~~the ~~payments~~spread ~~are~~of ~~current~~COVID-19 or its consequences, including disruption to our business and downturns in business sentiment generally or in our industry. Should COVID-19 cases in USA increase, the ~~warehouse is~~country ~~presently~~or ~~reflecting~~states ~~positive~~may ~~cash~~institute ~~flow~~stricter social distancing protocols.

While we have been able to acquire a warehouse in Denver, Colorado with owner financing, future acquisitions may require financial resources well in excess of our present balance sheet. Failure to successfully obtain additional funding would likely jeopardize our ability to expand our hemp business and related operations.8

The ~~loss~~ global outbreak of COVID-19 continues to rapidly evolve. The extent to which the COVID-19 pandemic impacts our ~~chief~~business ~~executive~~will ~~officer~~depend on future developments such as the rate of the spread of the disease, travel restrictions and social distancing in the United States and other countries, business closures or ~~key~~business ~~management~~disruptions and ~~personnel~~the effectiveness of actions taken in the United States and other countries to contain and treat the disease and to address its impact, including on financial markets or ~~inability~~otherwise. Further, a lack of coordinated response on risk mitigation and vaccination deployment with respect to ~~attract~~the COVID-19 pandemic on a local or federal level could result in significant increases to the duration and ~~retain~~severity of the pandemic ~~necessary~~in ~~personnel~~the United States as compared to the rest of the world and could have a corresponding negative impact on our business. While the extent of the impact of the current COVID-19 pandemic on our business and financial results is uncertain, a continued and prolonged public health crisis such as the COVID-19 pandemic could have a material ~~adverse~~negative ~~effect~~impact ~~upon~~on our business, financial condition orand operating results ~~of operations~~.

~~Our success~~To isthe ~~heavily~~extent ~~dependent on~~ the ~~continued~~COVID-19 ~~active~~pandemic ~~participation~~adversely affects of our ~~chief executive officer~~business, ~~largest~~financial ~~shareholder,~~condition and ~~sole~~operating ~~director listed~~results, ~~under~~it ~~“Management.”~~may ~~Loss~~also ofhave the ~~services of Mr. Evans, would have a material adverse~~ effect ~~upon our business, financial condition or results~~ of ~~operations.~~heightening ~~Further,~~many ~~our success and achievement~~ of ~~our~~the ~~growth~~risks ~~plans depend on our ability to recruit, hire,~~described ~~train~~in ~~and~~this ~~retain~~“Risk ~~other~~Factors” ~~highly qualified technical, professional, clerical, administrative and managerial personnel~~section. ~~Inability to attract and retain the necessary personnel, consultants and advisors could have a material adverse effect on our business, financial condition or results of operations.~~

~~Our~~Unfavorable global economic or political conditions could adversely ~~Chief~~affect ~~Executive~~our ~~Officer~~business, ~~has~~financial ~~significant~~condition ~~influence~~or ~~over~~results usof operations.

Our results of operations could be adversely affected ~~Chief~~by ~~Executive~~general ~~Officer~~conditions in the global economy and in the global financial markets. A global financial crisis or a global or regional political disruption could cause extreme volatility in the capital and credit markets. For example, outbreaks of epidemic, pandemic, or contagious diseases, such as the recent COVID-19 outbreak, could disrupt our business. Business disruptions could include disruptions to the productivity of our employees working remotely and restrictions on their travel may hinder their ability to meet with potential customers and close transactions, as well as temporary closures of the facilities of suppliers or contract growers as we try to develop our supply chain. In addition, the COVID-19 outbreak may result in a severe economic downturn and has already significantly affected the financial markets of many countries. A severe or prolonged economic downturn or political disruption could result in a variety of risks to our business, including our ability to ~~influence~~raise capital when needed on acceptable terms, if at all. A weak or declining economy or political disruption could also strain our operations, possibly resulting in a future supply disruption, or cause our future customers to delay making payments for our services. Any of the foregoing could harm our business ~~affairs~~and we cannot anticipate all of the ways in which the political or economic climate and financial market conditions could adversely impact our business.

~~It is~~We ~~likely~~have ~~that~~a ~~conflicts~~limited ofoperating ~~interest~~history ~~may~~and ~~arise~~operate inunder the ~~day-to-~~professional guidance ~~day operations~~ of our ~~business. Such~~Chairman ~~conflicts,~~and ~~if not properly resolved, could have a material negative impact on our business~~CEO.

~~In the~~Our ~~past,~~ability ~~the~~to ~~Company~~achieve ~~has~~consistent ~~issued shares for~~ cash ~~and~~flow ~~services at prices which were solely determined by prior management. At that time,~~and ~~management~~profitability ~~made~~depends aupon ~~determination of both~~ the ~~value~~continued service of ~~the~~Gary ~~exchange for our shares, and, as well, the price per share used in the capital raising effort~~C. ~~Transactions~~ ~~of this nature were not made at arm’s length and were made without input from a knowledgeable and non-interested third party~~Evans. ~~Future~~ ~~transactions of a like nature could dilute the percentage ownership of the company owned by a given investor~~Mr. ~~While~~Evans ~~the~~is ~~company~~our ~~believes~~Chairman ~~its~~and ~~past~~CEO, ~~transactions~~largest ~~were appropriate~~shareholder, and ~~plans to act in good faith in~~ the ~~future,~~primary anmanagement ~~investor~~level ~~in our shares will have no ability to alter such transactions as they may occur in the future and, further, will not be consulted by the company in advance of any such transactions~~executive. ~~An investor who is unwilling to endure such potential dilution should not purchase our shares.~~

8Our business plan provides that we will grow the Company’s asset base and revenues rapidly and ultimately deliver a positive cash flow generating company.

~~Adverse outcomes~~We inmay ~~future~~not ~~legal~~be ~~proceedings~~able ~~could~~to ~~subject~~generate uspredictable toand continuous ~~substantial~~revenue ~~damages~~in ~~and~~the ~~adversely~~future. ~~affect~~Further, ~~our~~there ~~results~~is ofno assurance that we will ever grow operations ~~and~~in ~~profitability~~the manner contemplated.

We may ~~become~~incur ~~party~~significant tooperating ~~legal~~losses ~~proceedings~~in the future, ~~including~~due ~~matters~~to ~~involving~~the ~~personnel~~expansion ~~and~~of ~~employment~~our ~~issues,~~operations ~~personal~~or ~~injury, environmental matters, and~~ other ~~proceedings~~factors. ~~Some~~There ofis ~~these~~no ~~potential~~assurance ~~proceedings~~that ~~could~~we ~~result~~can inexpand ~~substantial~~under ~~damages~~terms ~~or payment awards~~ that ~~exceed~~permit ~~our insurance~~profitable ~~coverage.~~operations Weover ~~will~~the ~~estimate~~long ~~our~~term. ~~exposure~~Failure to ~~any~~generate ~~future~~sufficient ~~legal~~revenue ~~proceedings~~to ~~and~~pay ~~establish~~expenses ~~provisions~~as ~~for~~they ~~the~~come ~~estimated~~due ~~liabilities~~may ~~where it~~make isus ~~reasonably~~unable ~~possible~~ to ~~estimate~~continue as ~~and~~a ~~where~~going anconcern ~~adverse outcome is probable. Assessing~~ and ~~predicting~~result in the ~~outcome~~failure of ~~these matters will involve substantial uncertainties. Furthermore, even if the outcome is ultimately in~~ our ~~favor,~~company ~~our~~and ~~costs associated with such litigation may be material. Adverse outcomes in future legal proceedings or~~ the ~~costs~~complete ~~and~~loss ~~expenses~~of ~~associated~~any ~~therewith~~money ~~could~~invested ~~have~~to anpurchase ~~adverse effect on~~ our ~~results of operations~~shares.

We ~~will~~ ~~seek~~may tobe ~~expand~~unable ~~through~~to ~~acquisitions~~manage ofour ~~and~~growth ~~investments~~or inimplement ~~various~~our ~~brands~~expansion strategy, ~~businesses,~~especially ~~and assets~~ in the ~~Hemp~~bitcoin ~~sector~~industry. ~~These acquisition activities may be unsuccessful or divert management’s attention.~~

WeAs a public company, our expenses include, but ~~will~~are ~~consider~~not ~~strategic~~limited ~~and~~to, ~~complementary~~annual ~~acquisitions~~audits, legal costs, SEC reporting costs, costs of a transfer agent and ~~investments~~the incosts ~~other~~associated ~~brands~~with fees and compliance. Further, ~~businesses~~our ormanagement ~~other~~will ~~assets~~need into invest significant time and energy to stay current with the ~~hemp~~public ~~sector,~~company responsibilities ~~and~~of ~~such~~our ~~acquisitions~~business orand ~~investments~~may ~~are~~from ~~subject~~time to ~~risks~~time ~~that~~have ~~could~~diminished ~~affect~~time ~~our~~available ~~business,~~to ~~including~~apply ~~risks~~to ~~related~~other tasks necessary to: our survival and growth.

●It ~~the~~is ~~necessity~~therefore ofpossible ~~coordinating~~that ~~geographically~~the ~~disparate~~financial ~~organizations; ● implementing common systems~~ and time ~~controls;~~burdens ●of ~~integrating~~operating ~~personnel~~as ~~with~~a ~~diverse~~public ~~business~~company ~~and~~will ~~cultural~~cause ~~backgrounds;~~us ●to ~~integrating~~fail ~~acquired manufacturing and production facilities, technology and products; ● unanticipated expenses related~~ to ~~integration,~~achieve ~~including~~profitability. ~~technical~~If ~~and~~we ~~operational~~exhaust ~~integration;~~our ~~● increased costs and unanticipated liabilities~~funds, ~~including~~our ~~with~~business ~~respect~~will fail ~~to registration, environmental, health~~ and ~~safety~~our ~~matters,~~investors ~~that~~will ~~may~~lose ~~affect~~all ~~sales~~money ~~and~~invested ~~operating results; ● retaining key employees; ● obtaining required government and third-party approvals; ● legal limitations~~ in ~~new jurisdictions; ● installing effective internal controls and audit procedures; ● issuing common stock that could dilute the interests of~~ our ~~existing stockholders; ● spending cash and incurring debt; ● assuming contingent liabilities; and ● creating additional expenses~~stock.

~~We may~~If ~~not~~we befail ~~able~~ to ~~identify~~pay ~~opportunities~~public orcompany ~~complete transactions on commercially reasonable terms~~costs, oras ~~at all, or actually realize any~~such ~~anticipated~~costs ~~benefits~~are ~~from~~incurred; ~~such acquisitions or investments. Similarly,~~ we ~~may~~could ~~not~~become bedelinquent ~~able~~in toour ~~obtain~~reporting ~~financing~~obligations ~~for~~and ~~acquisitions~~face ~~or investments on attractive terms. In addition,~~ the ~~success~~delisting of ~~any acquisitions or investments also will depend, in part, on~~ our ~~ability to integrate the acquisition or investment with our then existing operations~~shares.

~~We risk~~It ~~insolvency~~is ifessential ~~revenues~~that ~~decline~~we ~~sharply~~grow ~~and~~our weoverall ~~are~~business, achieve ~~unable~~significant ~~pay~~profits ~~our~~and ~~bills~~maintain ~~and~~adequate ~~unable~~cash flow in order to ~~timely~~pay ~~locate~~the ~~and~~cost ~~negotiate~~of remaining a ~~suitable~~public ~~business~~entity which includes but is ~~combination~~not orlimited ~~capital~~the ~~injection~~costs of remaining current with SEC reporting obligations.

Management is always concerned over potentially unfavorable events and related sharp reductions in revenues. If such problems occur, we will first reduce expenses, conserve cash and endeavor to replace lost revenue. In anticipation of possible problems of this nature, and alternatively to grow our business when opportunity presents, management has continued its negotiations in connection with potential business combinations and continues to explore other means of raising cash. Our goal is to develop cash reserves, either for expansion, or to cover shortfalls in revenue. Management believes that ultimately, consummation of one or more such transactions would serve the best interests of shareholders; however, there is no assurance that we can locate or consummate a suitable business combination or otherwise provide for liquidity, expanded working capital and a stronger balance sheet.9

9The issuance of additional shares of our common stock may be necessary for the implementation of our growth strategy.

WeLimited private placement of restricted shares ~~are~~of ~~subject~~our common stock has been completed from time to ~~corporate~~time ~~governance~~when ~~and~~deemed ~~internal~~necessary. ~~control~~Cash ~~reporting~~generated ~~requirements,~~in ~~and~~prior ~~our~~years ~~costs~~was ~~related~~used to ~~compliance~~acquire ~~with~~cannabis zoned real property, orfinance our ~~failure~~ office space and provide working capital. Issuance of any additional securities pursuant to ~~comply~~future fundraising ~~with~~activities undertaken may significantly dilute the ownership of existing shareholders and ~~future~~may ~~requirements,~~reduce ~~could~~the ~~adversely~~price ~~affect~~of our ~~business~~common stock.

We ~~face~~ ~~corporate governance requirements under the Sarbanes-Oxley Act of 2002~~acquired, asimproved ~~well as new rules~~ and ~~regulations~~leased ~~subsequently~~our ~~adopted by~~Denver ~~the SEC and the Public Company Accounting Oversight Board. These laws, rules and regulations continue to evolve and may become increasingly~~warehouse ~~stringent in the future. In particular, under new SEC rules we will be required~~ to ~~include~~a ~~management’s~~licensed ~~report~~third onparty ~~internal~~hemp ~~controls as~~seed ~~part of our annual report pursuant to Section 404 of the Sarbanes-Oxley Act~~grower. ~~Furthermore,~~Rental ~~under~~payments ~~the proposed rules, an attestation report on our internal controls from our independent registered public accounting firm will be required as part of our annual report. We~~ are incurrent ~~the~~and ~~process of evaluating our control structure to help ensure that we will be able to comply with Section 404 of~~ the ~~Sarbanes-Oxley Act.~~warehouse ~~The financial cost of compliance with these laws, rules and regulations~~ is ~~expected~~presently toreflecting bepositive ~~substantial.~~cash ~~We cannot assure you that we will be able to fully comply with these laws, rules and regulations that address corporate governance, internal control reporting and similar matters~~flow. ~~Failure to comply with these laws, rules and regulations could materially adversely affect our reputation, financial condition and the value of our securities.~~

InWhile ~~2022,~~we ~~management~~have ~~identified~~been aable ~~material weakness in our internal control over financial reporting related~~ to ~~the~~acquire ~~accounting~~a ~~for complex transactions. The Company has begun~~warehouse ~~the~~in ~~process~~Denver, ofColorado ~~designing~~with ~~and~~owner ~~implementing~~financing, ~~measures~~future toacquisitions ~~improve~~may ~~its~~require ~~internal controls over~~ financial ~~reporting~~resources ~~and~~well ~~remediate~~in ~~this~~excess ~~material weakness. The Company’s efforts include implementing additional reviews~~ of ~~business~~our ~~combination~~present ~~transactions~~balance ~~and modifying the Company’s instructions to valuation specialists and reviews of their workproduct~~sheet. ~~This will include staffing additions as appropriate. We will consider~~ ~~the~~Failure ~~material~~to ~~weakness~~successfully ~~remediated~~obtain ~~after~~additional ~~the~~funding ~~applicable~~would ~~controls~~likely ~~operate~~jeopardize ~~for~~our aability ~~sufficient~~to ~~period~~expand ~~of time, and management has concluded, through testing, that the controls are operating effectively. However,~~ our ~~remedial~~hemp ~~actions~~business ~~may~~and ~~not~~related ~~prevent this or similar weaknesses from occurring in the future~~operations.

~~Natural and~~The ~~other~~loss ~~disasters,~~of ~~information~~our ~~technology~~chief ~~system~~executive ~~failures~~officer ~~and~~or ~~network~~key ~~disruptions~~management ~~and~~personnel or ~~cybersecurity~~inability ~~breaches~~to attract and ~~attacks~~retain the necessary personnel could ~~adversely affect~~have a material adverse effect upon our business, financial condition or results of operations.

Our ~~business~~ ~~and~~success ~~results~~is ofheavily ~~operations~~dependent ~~could~~on bethe ~~negatively~~continued active ~~affected~~participation byof ~~certain factors beyond~~ our ~~control,~~chief ~~such~~executive ~~as natural disasters and/or climate change-related events (such as hurricanes~~officer, ~~earthquakes,~~largest ~~fires~~shareholder, and ~~floods);~~sole ~~civil~~director ~~unrest;~~listed ~~negative~~under ~~geopolitical~~“Management.” ~~conditions and~~Loss ~~developments;~~of ~~war,~~the ~~terrorism,~~services orof ~~other~~Mr. ~~man-made disasters; and information technology system failures~~Evans, ~~network~~would ~~disruptions~~have ~~and~~a ~~cybersecurity breaches~~material ~~and~~adverse ~~attacks.~~effect ~~Any~~upon ofour ~~these events could result in~~business, ~~among~~financial ~~other~~condition ~~things, damage to~~ or ~~the~~results ~~temporary closure~~ of ~~our~~operations. ~~facilities;~~Further, aour ~~temporary~~success ~~lack~~and achievement of anour ~~adequate~~growth ~~work~~plans ~~force~~depend inon ~~one~~our orability ~~more~~to ~~markets;~~recruit, anhire, ~~interruption~~train inand ~~power~~retain ~~supply;~~other ahighly ~~temporary~~qualified ~~or long-term disruption~~technical, inprofessional, ~~our~~clerical, ~~supply~~administrative ~~chain;~~ and ~~short-~~managerial orpersonnel. ~~long-term~~Inability ~~damage~~ to ~~our~~attract ~~prospective customers’ businesses (which would adversely impact demand for our products~~ and ~~services). ∙ We~~retain ~~rely~~the onnecessary ~~our own information systems~~personnel, ~~as well as those of our third-party business~~consultants ~~partners~~ and ~~suppliers.~~advisors ~~Despite~~could ~~the~~have ~~introduction~~a ofmaterial ~~system~~adverse ~~backup~~effect ~~measures~~on ~~and~~our ~~engage in information system redundancy planning and processes~~business, ~~such~~ ~~measures,~~financial ~~planning~~condition ~~and processes may be ineffective~~ or ~~inadequate~~results toof ~~address all eventualities~~operations.

~~Further, our~~Our ~~information~~Chief ~~systems~~Executive ~~and~~Officer our business partners’ and suppliers’ information systems may be vulnerable to attacks by hackers and other security breaches, including computer viruses and malware, through the internet (including via devices and applications connected to the internet), email attachments and persons with access to these information systems, such as our employees or third parties with whom we do business. As information systems and the use of software and related applications by us, our business partners, suppliers, and customers become more cloud-based and connected to the internet, there has ~~been~~significant aninfluence ~~increase~~over in global cybersecurity vulnerabilities and threats, including more sophisticated and targeted cyber-related attacks that pose a risk to the security of our information systems and networks and the confidentiality, availability and integrity of data and informationus. ~~Any such attack or breach could compromise our networks and the information stored thereon could be accessed, publicly disclosed, lost, or stolen.~~

~~If we~~Our orChief ~~our~~Executive ~~business~~Officer ~~partners~~has orthe ~~suppliers~~ability ~~were~~ to ~~experience a system disruption, attack or security breach that impacts any of our critical~~ ~~functions,~~influence orall ~~our customers were to experience a system disruption, attack or security breach via any~~ of our connected products and services, it could result in a period of shutdown of information systems during which we may not be able to operate, the loss of sales and customers, financial misstatement, potential liability for damages to our customers, reputational damage and significant incremental costs, which could adversely affect our business, ~~results of operations and profitability~~affairs. Furthermore, any access to, public disclosure of, or other loss of data or information (including any of our confidential or proprietary information or personal data or information) as a result of an attack or security breach could result in governmental actions or private claims or proceedings, which could damage our reputation, cause a loss of confidence in our products and services, damage our ability to develop (and protect our rights to) our proprietary technologies and adversely affect our business.

~~Failure to~~It ~~comply~~is ~~with~~likely ~~U.S.~~that ~~federal,~~conflicts ~~state~~of ~~and~~interest ~~international~~may ~~laws~~arise ~~and~~in ~~regulations relating to privacy or data protection, or~~ the ~~expansion of~~day-to- ~~current~~day oroperations ~~the enactment~~ of ~~new~~our ~~laws~~business. Such orconflicts, ~~regulations~~if ~~relating~~not toproperly ~~privacy or data protection~~resolved, could ~~adversely~~have ~~affect~~a ~~our~~material ~~business~~negative ~~and~~impact on our ~~financial~~ ~~condition~~business.

~~Failure to~~In ~~comply~~the ~~with U.S. federal~~past, ~~state~~the ~~and~~Company ~~international~~has ~~laws~~issued ~~and~~shares ~~regulations relating to privacy or data protection, or the expansion of~~for ~~current~~cash orand ~~the~~services ~~enactment~~at ofprices ~~new~~which ~~laws~~were orsolely ~~regulations~~determined ~~relating~~by toprior ~~privacy~~management. orAt ~~data~~that ~~protection~~time, ~~could~~management ~~adversely~~made ~~affect~~a ~~our~~determination ~~business~~of ~~and~~both ~~our~~the ~~financial~~value ~~condition.~~of Athe ~~variety~~exchange offor ~~U.S.~~our ~~federal~~shares, ~~state~~ and ~~international laws and regulations govern the collection~~, ~~use,~~as ~~retention~~well, ~~sharing and~~the ~~security~~price ofper ~~data.~~share ~~Laws~~used ~~and~~in ~~regulations~~the ~~relating~~capital toraising ~~privacy~~effort. Transactions ~~and~~of ~~data protection are evolving and subject to potentially differing~~this ~~interpretations.~~nature ~~These~~were ~~requirements~~not ~~may~~made beat ~~interpreted~~arm’s length and ~~applied~~were inmade awithout ~~manner~~input ~~that is inconsistent~~ from ~~one~~a ~~jurisdiction~~knowledgeable toand ~~another or~~non-interested ~~may~~third ~~conflict with other rules or our practices~~party. Future transactions Asof a ~~result,~~like ~~our~~nature ~~practices~~could ~~may~~dilute ~~not~~the ~~have~~percentage ~~complied~~ownership orof ~~may not comply in~~ the ~~future~~company ~~with all~~owned ~~such~~by ~~laws,~~a ~~regulations,~~given ~~requirements and obligations~~investor. ~~Any~~While ~~failure,~~the orcompany ~~perceived failure, by us to comply with our posted privacy~~believes ~~policies~~its orpast ~~with~~transactions ~~any~~were ~~federal~~appropriate, ~~state~~and orplans ~~international~~to ~~privacy~~act orin ~~data~~good ~~protection~~faith ~~related~~in ~~laws,~~the ~~regulations~~future, ~~industry~~an ~~self-regulatory~~investor ~~principles, industry~~in ~~standards~~our orshares ~~codes~~will ofhave ~~conduct,~~no ~~regulatory~~ability ~~guidance, orders~~ to ~~which we may be subject or other legal obligations relating to~~ ~~privacy~~alter orsuch ~~data~~transactions ~~protection~~as ~~could~~they ~~adversely~~may ~~affect~~occur ~~our~~in ~~reputation~~the ~~and~~future ~~business~~and, ~~and may result in claims~~further, ~~proceedings~~will ornot ~~actions~~be ~~against us~~consulted by ~~governmental~~the ~~entities~~company orin ~~others~~advance orof ~~other~~any ~~liabilities~~such ~~or require us to change our operations and/or cease using certain data sets~~transactions. ~~Any~~An ~~such~~investor ~~claim,~~who ~~proceeding~~is orunwilling ~~action could hurt our reputation and business, force us~~ to ~~incur~~endure ~~significant~~such ~~expenses~~potential indilution ~~defense~~should ofnot ~~such proceedings,~~purchase ~~distract~~ our ~~management, increase our costs of doing business, result in a loss of customers~~shares.

10Adverse outcomes in any future legal proceedings could subject us to substantial damages and adversely affect our results of operations and profitability.

~~Uncertain~~We may become party to legal proceedings, including ~~Economic~~matters involving personnel and employment issues, ~~Social~~personal injury, environmental matters, and ~~Political~~other ~~Environment~~proceedings. Some of these potential proceedings could result in substantial damages or payment awards that exceed our insurance coverage. We will estimate our exposure to any future legal proceedings and establish provisions for the estimated liabilities where it is reasonably possible to estimate and where an adverse outcome is probable. Assessing and predicting the outcome of these matters will involve substantial uncertainties. Furthermore, even if the outcome is ultimately in our favor, our costs associated with such litigation may be material. Adverse outcomes in future legal proceedings or the costs and expenses associated therewith could have an adverse effect on our results of operations.

Consumer, corporate and financial confidence may be adversely affected by current or future tensions around the world, fear of terrorist activity and/or military conflicts, localized or global financial crises or other sources of political, social or economic unrest. Such erosion of confidence may lead to or extend a localized or global economic downturn. A climate of uncertainty may reduce the availability of potential investment opportunities, and increases the difficulty of modeling market conditions, potentially reducing the accuracy of financial projections. In addition, limited availability of credit for consumers, homeowners and businesses, including credit used to acquire businesses, in an uncertain environment or economic downturn may have an adverse effect on the economy generally and on our ability to make acquisitions. This may slow or halt our rate of growth and materially and adversely affect our business and/or stock price.10

~~The Company~~We will ~~incur~~seek ~~expenses~~to inexpand ~~connection~~through ~~with~~acquisitions ~~its~~of ~~SEC~~and ~~filing~~investments in ~~requirements~~various ~~and~~brands, ~~may~~businesses, ~~not~~and beassets ~~able~~in tothe ~~meet~~Hemp ~~such~~sector. ~~costs,~~These ~~which~~acquisition ~~could~~activities ~~jeopardize its~~may ~~filing~~be ~~status~~unsuccessful ~~with~~or ~~the~~divert ~~SEC~~management’s attention.

~~As a~~We ~~public~~will ~~reporting~~consider ~~company,~~strategic ~~the~~and ~~Company~~complementary ~~is required to meet the filing requirements~~ acquisitions of ~~the~~and ~~SEC.~~investments ~~The Company may see an increase~~ in ~~its legal,~~other ~~accounting~~brands, ~~auditing~~businesses ~~and~~or ~~fees~~other ~~and~~assets ~~expenses~~in asthe ahemp ~~result~~sector, ofand such ~~requirements.~~acquisitions ~~Our~~or ~~costs~~investments ~~will increase significantly as the Company expands operations. Our filings~~ are subject to ~~comment from the SEC on its filings and/or it is required to file supplemental filings~~ ~~for~~risks ~~transactions~~that ~~and activities. If the Company is not compliant in meeting the filing requirements of the SEC, it~~ could ~~lose~~affect ~~its~~our ~~status as a 1934 Act Company~~business, ~~which~~including ~~could~~risks ~~compromise~~related ~~its ability~~ to ~~raise funds.~~:

~~Risks Related~~● the necessity of coordinating geographically disparate organizations; ● implementing common systems and controls; ● integrating personnel with diverse business and cultural backgrounds; ● integrating acquired manufacturing and production facilities, technology and products; ● unanticipated expenses related to ~~our~~integration, ~~Activities~~including technical and operational integration; ● increased costs and unanticipated liabilities, including with respect to registration, environmental, health and safety matters, that may affect sales and operating results; ● retaining key employees; ● obtaining required government and third-party approvals; ● legal limitations in new jurisdictions; ● installing effective internal controls and audit procedures; ● issuing common stock that could dilute the ~~Legal~~interests ~~Hemp~~of ~~Industry~~our existing stockholders; ● spending cash and incurring debt; ● assuming contingent liabilities; and ● creating additional expenses.

We ~~will~~ may not be ~~subject~~able to aidentify ~~myriad~~opportunities ofor complete ~~different~~transactions ~~laws~~on ~~and~~commercially ~~regulations~~reasonable ~~governing~~terms, ~~hemp~~or ~~and~~at ~~our~~all, ~~inability~~or toactually ~~comply~~realize ~~with~~any ~~such~~anticipated ~~laws~~benefits infrom asuch ~~cost-effective~~acquisitions ~~manner~~or investments. Similarly, we may ~~have~~not anbe ~~adverse~~able ~~effect~~to obtain financing for acquisitions or investments on ~~our~~attractive ~~business~~terms. ~~and~~In ~~result~~addition, the success of any acquisitions or investments also will depend, in part, on our ability to integrate the acquisition or investment with our then existing operations.

~~Laws and~~We ~~regulations~~risk ~~governing~~insolvency ~~the~~if ~~use~~revenues ofdecline ~~hemp~~sharply inand ~~the~~we ~~United States~~ are ~~broad in scope; subject to evolving interpretations; and subject to~~unable ~~enforcement~~pay byour abills ~~myriad of regulatory agencies~~ and ~~law~~unable ~~enforcement entities. Under the Agriculture Improvement Act of 2018, also known as the 2018 Farm Bill, a state or Indian tribe that desires~~ to ~~have~~timely ~~primary~~locate ~~regulatory authority over the production of hemp in the state or territory of the Indian tribe must submit a plan to monitor~~ and ~~regulate~~negotiate hemp production to the Secretary of the USDA. The Secretary must then approve the state or tribal plan after determining if the plan complies with the requirements set forth in the Agriculture Improvement Act of 2018. The Secretary may also audit the state or Indian tribe’s compliance with the federally-approved plan. If the Secretary does not approve the state or Indian tribe’s plan, then the production of hemp in that state or territory of that Indian tribe will be subject to a ~~plan~~suitable ~~established~~business bycombination USDA. USDA has not yet established such a plan. We anticipate that many states will seek to have primary regulatory authority over the production of hemp. States that seek such authority may create new laws and regulations that limit or ~~restrict~~capital ~~the use of hemp~~injection.

~~Federal and~~Management ~~state~~is ~~laws~~always concerned over potentially unfavorable events and ~~regulations~~related onsharp ~~hemp~~reductions ~~may~~in ~~address~~revenues. ~~production,~~If ~~monitoring,~~such ~~manufacturing,~~problems ~~distribution~~occur, ~~and~~we ~~laboratory~~will ~~testing~~first toreduce ~~ensure that~~expenses, ~~that~~conserve ~~the~~cash ~~hemp~~and endeavor ~~has~~to areplace ~~delta-9~~lost ~~tetrahydrocannabinol~~revenue. ~~concentration~~In anticipation of ~~not~~possible ~~more~~problems ~~than~~of ~~0.3%~~this onnature, aand ~~dry~~alternatively ~~weight~~to ~~basis.~~grow ~~Federal~~our ~~laws~~business ~~and~~when ~~regulations~~opportunity ~~may~~presents, ~~also~~management ~~address~~has ~~the~~continued ~~transportation~~its ornegotiations ~~shipment~~in ofconnection ~~hemp~~with orpotential ~~hemp~~business ~~products,~~combinations asand ~~the~~continues ~~Agriculture~~to ~~Improvement~~explore ~~Act~~other means of ~~2018~~raising ~~prohibits~~cash. ~~states and~~Our ~~Indian~~goal ~~tribes~~is ~~from~~to ~~prohibiting~~develop ~~the~~cash ~~transportation~~reserves, oreither ~~shipment~~for ofexpansion, ~~hemp~~ or ~~hemp~~to ~~products~~cover ~~produced~~shortfalls in ~~accordance~~revenue. ~~with~~Management believes that ~~law~~ultimately, ~~through the~~consummation ~~state or territory~~ of ~~the~~one ~~Indian~~or ~~tribe,~~more assuch ~~applicable.~~transactions Wewould ~~may~~serve bethe ~~subject~~best tointerests ~~many~~of ~~different~~shareholders; ~~state-based~~however, ~~regulatory~~there ~~regimens~~is ~~for~~no ~~hemp,~~assurance ~~all~~that ofwe ~~which~~can ~~could~~locate ~~require~~or usconsummate toa ~~incur~~suitable ~~substantial~~business ~~costs~~combination ~~associated~~or ~~with~~otherwise ~~compliance~~provide ~~requirements.~~for ~~Our~~liquidity, ~~operations~~expanded ~~will~~working becapital ~~restricted to only where such operations are legal on the local, state~~ and ~~federal~~a ~~levels~~stronger balance sheet.

11We are subject to corporate governance and internal control reporting requirements, and our costs related to compliance with, or our failure to comply with existing and future requirements, could adversely affect our business.

InWe face corporate governance requirements under ~~addition~~the Sarbanes-Oxley Act of 2002, itas iswell ~~possible~~as ~~that~~new ~~additional~~rules and regulations subsequently adopted by the SEC and the Public Company Accounting Oversight Board. These laws, rules and regulations continue to evolve and may bebecome ~~enacted~~increasingly stringent in the future. In particular, under new SEC rules we will be required to include management’s report on internal controls as part of our annual report pursuant to Section 404 of the Sarbanes-Oxley Act. Furthermore, under the proposed rules, an attestation report on our internal controls from our independent registered public accounting firm will be required as part of our annual report. We are in the ~~United~~process ~~States~~of evaluating our control structure to help ensure that we will be able to comply with Section 404 of the Sarbanes-Oxley Act. The financial cost of compliance with these laws, rules and ~~globally~~regulations is expected to be substantial. We cannot assure you that we will be ~~directly~~able to fully comply with these ~~applicable~~laws, rules and regulations that address corporate governance, internal control reporting and similar matters. Failure to ~~research~~comply with these laws, rules and ~~development~~regulations ~~operations~~could materially adversely affect our reputation, financial condition and the value of our securities.

We cannot predict the nature of any future laws, regulations, interpretations, or applications, nor can we determine what effect additional governmental regulations or administrative policies and procedures, when and if promulgated, could have on our business.11

WeManagement ~~have~~identified a ~~limited~~material ~~operating~~weakness ~~history~~ in our internal control over financial reporting related to the ~~legal~~accounting ~~hemp~~for ~~industry,~~complex ~~which~~transactions. ~~makes~~The Company ithas ~~difficult~~begun the process of designing and implementing measures to ~~accurately~~improve ~~assess~~its ~~our~~internal ~~future~~controls ~~growth~~over ~~prospects~~financial reporting and remediate this material weakness. The Company’s efforts include implementing additional reviews of business combination transactions and modifying the Company’s instructions to valuation specialists and reviews of their workproduct. This will include staffing additions as appropriate. We will consider the material weakness remediated after the applicable controls operate for a sufficient period of time, and management has concluded, through testing, that the controls are operating effectively. However, our remedial actions may not prevent this or similar weaknesses from occurring in the future.

~~The legal~~Natural ~~hemp~~ and ~~cannabis~~other ~~industry is an evolving industry that may not develop as expected. Furthermore~~disasters, ~~our~~information ~~operations~~technology ~~will~~system ~~continue~~failures toand ~~evolve~~network asdisruptions weand ~~continually~~cybersecurity ~~assess~~breaches ~~new~~and ~~strategic~~attacks ~~opportunities~~could ~~for~~adversely affect our business ~~within this industry~~. ~~Assessing the future prospects of this industry is challenging in light of both known and unknown risks and difficulties we may encounter.~~

~~Growth~~Our business and results of operations could be ~~prospects~~negatively affected by certain factors beyond our control, such as natural disasters and/or climate change-related events (such as hurricanes, earthquakes, fires, and floods); civil unrest; negative geopolitical conditions and developments; war, terrorism, or other man-made disasters; and information technology system failures, network disruptions and cybersecurity breaches and attacks. Any of these events could result in, among other things, damage to or the ~~legal~~temporary ~~hemp~~closure ~~and~~of ~~cannabis~~our ~~industry~~facilities; ~~can~~a betemporary ~~affected~~lack byof an adequate work force in one or more markets; an interruption in power supply; a ~~wide~~temporary ~~variety~~or long-term disruption in our supply chain; and short- or long-term damage to our prospective customers’ businesses (which would adversely impact demand for our products and services). ∙ We rely on our own information systems, as well as those of ~~factors~~our ~~including:~~third-party business partners and suppliers. Despite the introduction of system backup measures and engage in information system redundancy planning and processes, such measures, planning and processes may be ineffective or inadequate to address all eventualities.

●Further, ~~Competition~~our ~~from~~information ~~other~~systems ~~similar~~and ~~companies;~~our ●business partners’ ~~Fluctuations~~and insuppliers’ ~~the~~information ~~market~~systems ~~price~~may ofbe ~~CBD~~vulnerable ~~oil;~~to ●attacks ~~Regulatory~~by ~~limitations~~hackers onand other security breaches, including computer viruses and malware, through the ~~types~~internet of(including ~~research~~via devices and ~~development~~applications connected to the internet), email attachments and persons with ~~respect~~access to ~~cannabis;~~these ●information ~~Other~~systems, ~~changes~~such inas our employees or third parties with whom we do business. As information systems and the ~~regulation~~use of ~~cannabis~~software and ~~legal~~related ~~hemp~~applications ~~use;~~by us, our business partners, suppliers, and ●customers ~~Changes~~become more cloud-based and connected to the internet, there has been an increase in ~~underlying~~global ~~consumer~~cybersecurity ~~behavior~~vulnerabilities and threats, ~~which~~including ~~may~~more ~~affect~~sophisticated and targeted cyber-related attacks that pose a risk to the ~~demand~~security of our ~~legal~~information ~~hemp~~systems and ~~cannabis~~networks ~~traits~~and the confidentiality, availability and integrity of data and information. Any such attack or breach could compromise our networks and the information stored thereon could be accessed, publicly disclosed, lost, or stolen.

WeIf we or our business partners or suppliers were to experience a system disruption, attack or security breach that impacts any of our critical functions, or our customers were to experience a system disruption, attack or security breach via any of our connected products and services, it could result in a period of shutdown of information systems during which we may not be able to ~~successfully~~operate, ~~address~~ the ~~above~~loss ~~factors~~of sales and customers, financial misstatement, potential liability for damages to our customers, reputational damage and significant incremental costs, which could ~~negatively~~adversely ~~impact~~affect our ~~intended~~ business, results ~~plans~~of operations and profitability. Furthermore, any access to, public disclosure of, or other loss of data or information (including any of our confidential or proprietary information or personal data or information) as a result of an attack or security breach could result in governmental actions or private claims or proceedings, which could damage our reputation, cause a loss of confidence in our products and services, damage our ability to develop (and protect our rights to) our proprietary technologies and adversely affect our business.

~~Because~~Failure to comply with U.S. federal, state and international welaws ~~have~~and ~~only~~regulations ~~recently~~relating ~~begun~~to ~~our~~privacy ~~legal~~or ~~hemp~~data ~~operations~~protection, weor ~~anticipate~~the ~~our~~expansion ~~operating~~of ~~expenses~~current ~~will~~or ~~increase~~the ~~prior~~enactment toof ~~earning~~new ~~revenue~~laws ~~from~~or regulations relating ~~these~~to ~~operations~~privacy or data protection, could adversely affect our business and our financial condition.

AsFailure to comply with U.S. federal, state and weinternational ~~identify~~laws and ~~develop~~regulations ~~strategic~~relating ~~opportunities~~to privacy or data protection, ~~conduct~~or ~~any~~the ~~necessary~~expansion ~~research~~of ~~and~~current ~~development~~or ~~with~~the ~~respect~~enactment of new laws or regulations relating to ~~legal~~privacy ~~hemp~~or data protection, could adversely affect our business and ~~expand~~ our ~~operations~~financial condition. A variety of U.S. federal, westate ~~anticipate~~and ~~significant~~international ~~increases~~laws inand ~~our~~regulations ~~operating~~govern ~~expenses~~the collection, use, retention, sharing and wesecurity of data. Laws and regulations relating to privacy and data protection are evolving and subject to potentially differing interpretations. These requirements may ~~not~~be ~~realize~~interpreted and ~~significant~~applied ~~revenues~~in a manner that is inconsistent from ~~such operations~~one jurisdiction to another or may conflict with other rules or our practices. As a result, ~~the~~our ~~Company~~practices may ~~incur~~not ~~significant~~have ~~financial~~complied ~~losses~~or ~~with~~may ~~respect~~not tocomply in the future with all such ~~operations~~laws, inregulations, ~~the~~requirements ~~foreseeable~~and ~~future~~obligations. ~~There~~Any isfailure, noor ~~history~~perceived ~~upon~~failure, ~~which~~by us to ~~base~~comply with our posted privacy policies or with any ~~assumption~~federal, asstate or international privacy or data protection related laws, regulations, industry self-regulatory principles, industry standards or codes of conduct, regulatory guidance, orders to ~~the~~which ~~likelihood~~we ~~that~~may ~~these~~be subject or other legal obligations relating to privacy or data protection could adversely affect our reputation and business, and may result in claims, proceedings or actions against us by governmental entities or others or other liabilities or require us to change our operations ~~will~~and/or ~~prove~~cease ~~successful~~using certain data sets. Any such claim, proceeding or action could hurt our reputation and business, force us to incur significant expenses in defense of such proceedings, distract our management, increase our costs of doing business, result in a loss of customers.

~~Negative press from being in the hemp/cannabis space could have a material adverse effect on our business, financial condition, and results of operations.~~12

~~The hemp~~Uncertain ~~plant and the cannabis/marijuana plant are both part of the same cannabis sativa genus/species of plant~~Economic, ~~except~~Social that hemp, by definition, has less than 0.3% THC content, but the same plant with a higher THC content is cannabis/marijuana, which is legal under certain state laws, but which is not legal under federal law. The similarities between these plants can cause confusion, and ~~our~~Political ~~activities with legal hemp may be incorrectly perceived as us being involved in federally illegal cannabis~~Environment. Also, despite growing support for the cannabis industry and legalization of cannabis in certain U.S. states, many individuals and businesses remain opposed to the cannabis industry. Any negative press resulting from any incorrect perception that we have entered into the cannabis space could result in a loss of current or future business. It could also adversely affect the public’s perception of us and lead to reluctance by new parties to do business with us or to own our common stock. We cannot assure you that additional business partners, including but not limited to financial institutions and customers, will not attempt to end or curtail their relationships with us. Any such negative press or cessation of business could have a material adverse effect on our business, financial condition, and results of operations.

~~Risks~~Consumer, corporate and financial confidence may ~~Related~~be adversely affected by current or future tensions around the world, fear of terrorist activity and/or military conflicts, localized or global financial crises or other sources of political, social or economic unrest. Such erosion of confidence may lead to ~~Ownership~~or extend a localized or global economic downturn. A climate of ~~Our~~uncertainty ~~Common~~may ~~Stock~~reduce the availability of potential investment opportunities, and increases the difficulty of modeling market conditions, potentially reducing the accuracy of financial projections. In addition, limited availability of credit for consumers, homeowners and businesses, including credit used to acquire businesses, in an uncertain environment or economic downturn may have an adverse effect on the economy generally and on our ability to make acquisitions. This may slow or halt our rate of growth and materially and adversely affect our business and/or stock price.

~~Our stock~~The ~~price~~Company ~~has~~will ~~been~~incur expenses in connection with its SEC filing requirements and may ~~continue~~not be able to bemeet ~~volatile~~such costs, ~~and~~which ~~you~~ could ~~lose~~jeopardize ~~all~~its orfiling ~~part~~status ofwith ~~your~~the ~~investment~~SEC.

~~The~~As a public reporting company, the Company is ~~market~~required ~~price~~to meet the filing requirements of ~~our~~the ~~common~~SEC. ~~stock~~The isCompany ~~subject~~may tosee ~~wide~~an ~~fluctuations~~increase in ~~response~~its tolegal, ~~various~~accounting, ~~risk~~auditing ~~factors,~~and ~~some~~fees and expenses as a result of ~~which~~such ~~are~~requirements. ~~beyond~~Our ~~our~~costs ~~control~~will increase significantly as the Company expands operations. Our filings are subject to comment from the SEC on its filings and/or ~~may~~it is required to file supplemental filings for transactions and activities. If the Company is not becompliant ~~related~~in tomeeting ~~our~~the ~~operating~~filing ~~performance~~requirements of the SEC, ~~including:~~it could lose its status as a 1934 Act Company, which could compromise its ability to raise funds.

●Risks ~~addition~~Related orto ~~loss~~our ofActivities ~~significant customers, suppliers, or distributors; ● changes~~ in ~~laws~~the orLegal Hemp ~~regulations applicable to our industry ;~~Industry

12We will be subject to a myriad of different laws and regulations governing hemp and bitcoin. Our inability to comply with such laws in a cost-effective manner may have an adverse effect on our business and result of operations.

●Laws ~~additions~~and orregulations ~~departures~~governing ofthe ~~key~~use ~~personnel;~~of ●hemp in the ~~failure~~United ofStates ~~securities~~are ~~analysts~~broad toin ~~cover~~scope; ~~our~~subject ~~common~~to ~~stock~~evolving ~~after~~interpretations; anand ~~offering;~~subject ●to ~~actual~~enforcement orby ~~anticipated~~a ~~changes~~myriad inof ~~expectations~~regulatory ~~regarding~~agencies and ~~our~~law ~~performance~~enforcement byentities. ~~investors~~Under orthe ~~securities~~Agriculture ~~analysts;~~Improvement ●Act ~~price~~of ~~and~~2018, ~~volume~~also ~~fluctuations~~known inas the ~~overall~~2018 ~~stock~~Farm ~~market;~~Bill, ●a ~~volatility~~state inor ~~the~~Indian ~~market~~tribe that ~~price~~desires ~~and~~to ~~trading~~have ~~volume~~primary regulatory authority over the production of ~~companies~~hemp in ~~our~~the ~~industry~~state or ~~companies~~territory ~~that~~of ~~investors~~the ~~consider~~Indian ~~comparable;~~tribe ●must ~~share~~submit a ~~price~~plan to monitor and ~~volume~~regulate ~~fluctuations~~hemp ~~attributable~~production to ~~inconsistent~~the ~~trading~~Secretary ~~volume~~of ~~levels~~the ofUSDA. ~~our~~The ~~shares;~~Secretary ●must ~~our~~then ~~ability~~approve tothe ~~protect~~state ~~our~~or ~~intellectual~~tribal ~~property~~plan after ~~and~~determining ~~other~~if ~~proprietary~~the ~~rights;~~plan ●complies ~~sales~~with the requirements set forth in the Agriculture Improvement Act of ~~our~~2018. ~~common~~The ~~stock~~Secretary bymay usalso audit the state or ~~our~~Indian ~~stockholders;~~tribe’s ●compliance with the ~~expiration~~federally-approved ofplan. ~~contractual~~If ~~lock-up~~the ~~agreements;~~Secretary ●does ~~litigation~~not ~~involving~~approve ~~us,~~the ~~our~~state ~~industry~~or Indian tribe’s plan, then the production of hemp in that state or ~~both;~~territory ●of ~~major~~that ~~catastrophic~~Indian ~~events;~~tribe ~~and~~will ●be ~~general~~subject ~~economic~~to ~~and~~a ~~market~~plan ~~conditions~~established by USDA. USDA has not yet established such a plan. We anticipate that many states will seek to have primary regulatory authority over the production of hemp. States that seek such authority may create new laws and ~~trends~~regulations that limit or restrict the use of hemp.

~~Further, the~~Federal ~~stock~~and ~~markets~~state ~~have~~laws ~~experienced~~and ~~extreme~~regulations ~~price~~on ~~and~~hemp may ~~volume~~address ~~fluctuations~~production, ~~that~~monitoring, ~~have~~manufacturing, ~~affected~~distribution, and ~~continue~~laboratory testing to ~~affect~~ensure that that the ~~market~~hemp ~~prices of~~has ~~equity~~a ~~securities~~delta-9 tetrahydrocannabinol concentration of ~~many~~not ~~companies~~more than 0.3% ~~These~~on ~~fluctuations~~a ~~often~~dry ~~have~~weight ~~been~~basis. ~~unrelated~~Federal orlaws ~~disproportionate~~and toregulations may also address the ~~operating~~transportation ~~performance~~or shipment of ~~those~~hemp ~~companies.~~or Inhemp ~~addition~~products, as the ~~stock~~Agriculture ~~prices~~Improvement Act of ~~many~~2018 ~~cannabis-related~~prohibits ~~companies~~states ~~have~~and ~~experienced~~Indian ~~wide~~tribes ~~fluctuations~~from ~~that~~prohibiting ~~have~~the ~~often~~transportation ~~been~~or ~~unrelated~~shipment toof ~~the~~hemp ~~operating~~or ~~performance~~hemp ofproducts ~~those~~produced ~~companies.~~in ~~These~~accordance ~~broad~~with ~~market~~that ~~and~~law ~~industry~~through ~~fluctuations,~~the asstate ~~well~~or asterritory ~~general~~of ~~economic, political,~~the ~~and~~Indian ~~market~~tribe, ~~conditions such~~ as ~~recessions,~~applicable. We ~~interest~~may ~~rate~~be ~~changes,~~subject orto ~~international~~many ~~currency~~different ~~fluctuations,~~state-based ~~may~~regulatory ~~cause~~regimens ~~the~~for ~~market price~~hemp, all of ~~our~~which ~~common~~could ~~stock~~require us to ~~decline.~~incur Ifsubstantial ~~the~~costs associated ~~market~~with ~~price~~compliance ofrequirements. ~~our~~Our ~~common~~operations ~~stock~~will ~~fluctuates~~be orrestricted ~~declines,~~to ~~you~~only ~~may~~where ~~not~~such ~~realize~~operations ~~any~~are ~~return~~ legal on ~~your~~the ~~investment~~local, state and ~~may~~federal ~~lose some or all of your investment~~levels.

~~Our~~In addition, it is possible that additional regulations ~~operating~~may ~~results~~be ~~are~~enacted ~~subject~~in tothe ~~fluctuations~~future in the United States and ~~our~~globally ~~stock~~that ~~price~~will ~~may~~be ~~decline~~directly ~~significantly~~applicable to research and development operations.

~~Our quarterly~~We ~~revenue~~cannot ~~and operating results are difficult to~~ predict ~~from~~the ~~quarter~~nature toof ~~quarter.~~any Wefuture ~~derive revenue from our hemp processing~~laws, ~~business~~regulations, ~~which~~interpretations, isor ~~dependent~~applications, ~~upon~~nor ~~volumes~~can ~~produced~~we bydetermine ~~farmers~~what ~~and~~effect isadditional ~~seasonal.~~governmental ~~Prices~~regulations ~~for~~or ~~products derived from hemp have declined significantly~~administrative ~~over~~policies ~~the~~and ~~past~~procedures, ~~few~~when ~~years~~and ~~resulting~~if ~~in many farmers exiting the industry. We derive relatively stable revenue from our property leased industrial warehouse. Nonetheless~~promulgated, itcould ishave ~~possible~~on ~~that~~ our ~~net operating results in some quarters will fall below our expectations~~business. ~~Our quarterly operating results will be affected by a number of factors, including:~~

●We ~~Timing,~~have ~~availability~~a ~~and~~limited ~~changes~~operating inhistory ~~government incentive programs; ● Unplanned additional expenses and/or shortfalls~~ in ~~anticipated rental income at our warehouse property; ● Logistical costs; ● The timing of new technology announcements or introductions by our competitors and other developments in~~ the ~~competitive~~legal ~~environment;~~hemp ●industry, which ~~Increases~~makes orit ~~decreases~~difficult ~~in real estate appreciation rates due~~ to ~~changes~~accurately inassess ~~economic~~our future growth; ●prospects. ~~Travel costs and other factors; and ● State and federal government regulations~~

~~If revenue~~The ~~for~~legal ahemp ~~particular~~and ~~quarter~~cannabis industry is ~~lower~~an ~~than~~evolving industry wethat ~~expect, we~~ may not bedevelop ~~unable~~as toexpected. ~~proportionately~~Furthermore, ~~reduce~~ our ~~operating~~operations ~~expenses~~will ~~for~~continue ~~that quarter,~~to ~~which~~evolve ~~would~~as ~~harm~~we ~~our~~continually ~~operating~~assess ~~results~~new strategic opportunities for ~~that~~our ~~quarter.~~business Ifwithin wethis ~~fail~~industry. toAssessing ~~meet~~the ~~investor~~future ~~expectations~~prospects orof ~~our~~this ~~own~~industry ~~future~~is ~~guidance, even~~challenging byin alight ~~small~~of ~~amount,~~both ~~our~~known and ~~stock~~unknown ~~price~~risks ~~could~~and ~~decline,~~difficulties ~~perhaps~~we ~~substantially~~may encounter.

~~There are restrictions on the transferability of certain of our securities.~~13

~~Until registered~~Growth ~~for~~prospects ~~resale, investors must bear the economic risk of an investment~~ in the ~~Shares~~legal ~~for~~hemp anand ~~indefinite period of time. Rule 144~~cannabis ~~promulgated~~industry ~~under~~can ~~the~~be ~~Securities~~affected ~~Act~~by ~~(“Rule 144”), which provides for an exemption from the registration requirements under the Securities Act under certain conditions, requires, among other conditions,~~ a ~~six-month~~wide ~~holding~~variety ~~period prior to the resale (in limited amounts)~~ of ~~securities~~factors acquired in a non-public offering without having to satisfy the registration requirements under the Securities Act. There can be no assurance that we will fulfill any reporting requirements in the future under the Exchange Act or disseminate to the public any current financial or other information concerning us.including:

13● Competition from other similar companies; ● Fluctuations in the market price of CBD oil; ● Regulatory limitations on the types of research and development with respect to cannabis; ● Other changes in the regulation of cannabis and legal hemp use; and ● Changes in underlying consumer behavior, which may affect the demand of our legal hemp and cannabis traits.

~~If the~~We ~~Company~~may ~~uses~~not ~~its~~be ~~stock~~able into ~~acquisitions~~successfully ofaddress ~~other~~the above ~~entities~~factors, ~~there~~which ~~may~~could benegatively ~~substantial~~impact ~~dilution~~our atintended ~~the~~business ~~time of a transaction~~plans.

~~The offering~~Negative ~~price~~press offrom ~~the~~being ~~common~~in ~~stock~~the wehemp/cannabis ~~sold~~space ascould have a ~~private~~material ~~placement~~adverse ofeffect ~~restricted~~on ~~shares of~~ our ~~common stock to raise working capital~~business, ~~was~~ ~~arbitrarily~~financial ~~set. The price did not bear any relationship to our assets~~condition, ~~book value, earnings or net worth~~ and itresults ~~is not an indication~~ of ~~actual value~~operations. You may also suffer additional dilution in the future from the sale of additional shares of common stock or other securities or if the Company’s shares are issued to purchase other assets or to raise additional working capital.

~~Trading~~The hemp plant and the cannabis/marijuana plant onare both part of the ~~OTC~~same ~~Markets~~cannabis sativa genus/species of plant, except that hemp, by definition, has less than 0.3% THC content, but the same plant with a higher THC content is cannabis/marijuana, which is legal under certain state laws, but which is not legal under federal law. The similarities between these plants can cause confusion, and our activities with legal hemp may be ~~volatile~~incorrectly perceived as us being involved in federally illegal cannabis. Also, despite growing support for the cannabis industry and ~~sporadic~~legalization of cannabis in certain U.S. states, ~~which~~many individuals and businesses remain opposed to the cannabis industry. Any negative press resulting from any incorrect perception that we have entered into the cannabis space could ~~depress~~result in a loss of current or future business. It could also adversely affect the ~~market~~public’s ~~price~~perception of us and lead to reluctance by new parties to do business with us or to own our common stock. ~~and~~We ~~make~~cannot itassure ~~difficult~~you ~~for~~that ~~our~~additional business partners, including but not limited to financial institutions and customers, will ~~stockholders~~not attempt to ~~resell~~end or curtail their ~~shares~~relationships with us. Any such negative press or cessation of business could have a material adverse effect on our business, financial condition, and results of operations.

~~Our common~~Risks ~~shares~~Relating are quoted on OTCQB. There is no cost of such quotation and related services from OTC Markets, Inc. Trading in stock quoted on the OTCQB Markets is often thin and characterized by wide fluctuations in trading prices due to ~~many factors that may have little~~Digital toAsset doNetworks with our operations or business prospects. This volatility could depress the market price of our common stock for reasons unrelated to operating performance. Moreover, the OTC Markets is not a stock exchange, and ~~trading~~Digital of securities on the OTCQB Markets is often more sporadic than the trading of securities listed on a quotation system like Nasdaq or a stock exchange like the New York Stock Exchange. Accordingly, our stockholders may have difficulty reselling any of their shares. A number of brokerage houses will not trade our securities for customers because we are in the hemp business and/or because we trade on the OTC.Assets

~~The Company~~Digital ~~currently plans to move to a more advantageous trading market via a potential uplisting~~assets, tosuch aas ~~national exchange~~bitcoin, ~~and~~may abecome ~~formal application~~regulated ~~has~~as ~~been made. However, there is no assurance that we will be able to successfully move trading markets~~ securities or ~~uplist~~investment ~~to a national exchange~~securities.

~~Because~~Bitcoin is the oldest and most well-known form weof dodigital ~~not~~asset. ~~expect~~Bitcoin and other forms of digital assets / cryptocurrencies have been the source of much regulatory scrutiny, which has resulted in differing definitional outcomes without a single unifying statement. In the context of the offer and sale of the Initial Coin Offering (“ICO”) tokens, the SEC has determined certain digital tokens are securities under the Howey test as stated by the U.S. Supreme Court. ICO offerings of securities would require registration under the Securities Act or an available exemption therefrom for offers or sales in the United States to ~~pay~~be lawful. Section 5(a) of the Securities Act provides that, unless a registration statement is in effect as to a security, it is unlawful for any ~~dividends~~person, directly or indirectly, to engage in the offer or sale of securities in interstate commerce. Furthermore, Section 5(c) of the Securities Act provides a similar prohibition against offers to sell, or offers to buy, unless a registration statement has been filed. Although the Company does not believe its mining activities require registration for it to conduct such activities and accumulate digital assets, the ~~foreseeable~~SEC, ~~future~~the Commodity Futures Trading Commission (the “CFTC”), Nasdaq ~~investors~~or other governmental or quasi- governmental agency or organization may beconclude ~~forced~~that the Company’s activities involve the offer or sale of “securities,” or ownership of “investment securities,” and the Company may face regulation under the Securities Act or the Investment Company Act of 1940, as amended (the “Investment Company Act”). Such regulation or the inability to ~~sell~~meet ~~their~~the ~~stock~~requirements to ~~realize~~continue operations would have a ~~return~~material adverse effect on the Company’s business, financial ~~their~~condition ~~investment~~and results of operations.

~~We do~~The ~~not~~further ~~anticipate~~development ~~that~~and weacceptance ~~will pay any dividends to holders~~ of ~~our~~digital ~~common~~asset ~~stock for the foreseeable future. Any payment of cash dividends~~networks ~~will~~and beother atdigital ~~the~~assets, ~~discretion~~which ofrepresent ~~our~~a ~~board~~new ~~of directors~~ and ~~will~~rapidly ~~depend~~changing onindustry, ~~among~~are ~~other~~subject ~~things,~~to ~~our~~a ~~results~~variety of ~~operations, cash requirements, financial condition, contractual restrictions including compliance with covenants under our debt agreements, and other~~ factors that ~~our board~~are ~~of directors may deem relevant. Our ability~~ difficult to ~~pay~~evaluate, ~~dividends~~and ~~might~~the beslowing ~~restricted~~or bystopping ~~the terms~~ of ~~any indebtedness that we incur in~~ the ~~future.~~development Inor ~~addition,~~acceptance ~~certain~~ of ~~our~~digital ~~current~~asset ~~outstanding~~systems ~~debt~~may ~~agreements~~adversely ~~prohibit~~affect usthe ~~from paying cash dividends on our common stock.~~Company’s ~~Consequently~~business, ~~you~~financial ~~should~~condition ~~not~~and ~~rely~~results onof ~~dividends to receive a return on your investment~~operations.

~~Our common~~Digital ~~stock~~assets issuch ~~presently~~as ~~subject~~bitcoins, which may be used, among other things, to buy and sell goods and services are a new and rapidly evolving industry of which the ~~“Penny~~digital ~~Stock”~~asset ~~rules~~networks are prominent, but not unique, parts. The growth of the ~~SEC~~digital asset industry in general, and the digital asset networks of bitcoin in particular, are subject to a high degree of uncertainty. The factors affecting the further development of the digital asset industry, as well as the digital asset networks, include, among others:

~~We are~~● ~~subject~~continued ~~now~~worldwide togrowth in the ~~“Penny~~adoption ~~Stock”~~and ~~rules~~use ~~since our shares~~ of ~~common~~bitcoins ~~stock~~and ~~sell~~other ~~below~~digital ~~$5.00~~assets; ~~per~~● ~~share.~~government ~~Penny~~and ~~stocks~~quasi-government ~~generally are~~regulation ~~equity securities with a price~~ of ~~less~~bitcoins ~~than~~and ~~$5.00.~~other ~~The~~digital ~~penny~~assets ~~stock~~and ~~rules~~their ~~require~~use, ~~broker-dealers~~or torestrictions ~~deliver~~on aor ~~standardized~~regulation ~~risk~~of ~~disclosure document~~access ~~prepared~~to ~~by the SEC which provides information about penny stocks~~ and ~~the~~operation ~~nature and level~~ of ~~risks~~the indigital ~~the~~asset ~~penny~~network ~~stock~~or ~~market. The~~similar ~~broker-dealer~~digital ~~must~~assets ~~also~~systems; ~~provide~~● the ~~customer~~maintenance ~~with current bid~~ and ~~offer~~development ~~quotations for the penny stock, the compensation~~ of the ~~broker~~open-~~dealer and~~source ~~its~~software ~~salesperson,~~protocol ~~and~~of ~~monthly account statements showing~~ the ~~market~~bitcoin ~~value~~network; of● ~~each~~changes ~~penny stock held~~ in ~~the~~consumer ~~customer’s~~demographics ~~account. The bid~~ and ~~offer~~public ~~quotations,~~tastes and ~~the~~preferences; ~~broker-dealer~~● ~~and salesperson compensation information must be given to~~ the ~~customer~~availability ~~orally or in writing prior to completing the transaction~~ and ~~must~~popularity beof ~~given~~other toforms ~~the customer in writing before~~ or ~~with~~methods ~~the~~of ~~customer’s~~buying ~~confirmation. ∙~~and Inselling ~~addition,~~goods ~~the~~and ~~penny stock rules require that prior to a transaction~~services, ~~the~~including ~~broker~~new ~~dealer~~means ~~must~~of ~~make~~using afiat ~~special~~currencies; ~~written~~● ~~determination that~~general ~~the~~economic ~~penny~~conditions ~~stock is a suitable investment for the purchaser~~ and ~~receive~~ the ~~purchaser’s~~regulatory ~~written~~environment ~~agreement~~relating to ~~the~~digital ~~transaction. The~~assets; ~~penny stock rules are burdensome~~ and ~~may~~● ~~reduce~~ the ~~trading~~impact ~~activity for shares~~ of ~~our~~regulators ~~common~~focusing ~~stock.~~on Asdigital ~~long~~assets asand ~~our~~digital ~~shares~~securities ofand ~~common stock are subject to~~ the ~~penny~~costs ~~stock~~associated ~~rules,~~with ~~the holders of~~ such ~~shares~~regulatory ~~of common stock may find it more difficult to sell their securities~~oversight.

~~If we~~A ~~fail~~decline toin ~~remain~~the ~~current~~popularity onor ~~our~~acceptance ~~reporting~~of ~~requirements,~~the digital weasset ~~could~~networks beof ~~removed~~bitcoin, ~~from~~or ~~the~~similar ~~OTCQB~~digital ~~which~~asset ~~would~~systems, ~~limit~~could ~~the~~adversely ~~ability~~affect ofthe ~~broker-dealers to~~Company’s ~~sell~~business, ~~our~~financial ~~securities~~condition and inresults ~~the~~of ~~secondary market~~operations.

~~Companies trading~~If ondemand ~~the~~for ~~OTCQB~~transactions ~~must~~in bebitcoin ~~reporting~~declines ~~issuers under Section 12 of the Securities Exchange Act of 1934, as amended,~~ and ~~must~~is ~~be current~~replaced inby ~~their~~new ~~reports~~demand ~~under~~for ~~Section~~other 13cryptocurrencies, ~~in order to maintain price quotation privileges on~~ the ~~OTCQB.~~Company’s ~~As a result~~business, ~~the~~financial ~~market~~condition ~~liquidity for our securities could be severely adversely affected by limiting the ability of broker-dealers to sell our securities~~ and ~~the~~results ~~ability~~ of ~~stockholders~~operations tocould ~~sell their securities in the secondary market. In addition, we may~~ be ~~unable to get relisted on the OTCQB, which may~~adversely ~~have an adverse material effect on the Company~~affected.

IfThe Company’s business will be highly dependent on strong bitcoin wedemand ~~decide~~relative to ~~implement~~other acryptocurrencies ~~reverse~~in ~~stock~~the ~~split~~market. As such, ain ~~reverse~~addition ~~stock~~to ~~split~~the factors impacting the broader crypto economy described elsewhere in this section, the Company’s business may ~~decrease~~be adversely affected, and growth in the ~~liquidity~~Company’s, ofand therefore the Company’s, ~~shares~~revenues may slow or decline, if market demand for bitcoin deteriorates and is supplanted by other cryptocurrencies such as ethereum and dogecoin. In addition, negative perceptions surrounding bitcoin relative to other cryptocurrencies may cause bitcoin to fall out of ~~our~~favor. ~~common~~If ~~stock~~other cryptocurrencies, such as ethereum and dogecoin, surpass bitcoin in market demand over a sustained period of time, such a trend could harm the Company’s business. Competition from public and central bank backed digital currencies could undercut the need for other cryptocurrencies such as bitcoin. Competition from stablecoins (commodity-backed or fiat-backed) could undercut demand for other cryptocurrencies such as bitcoin.

~~The liquidity~~Significant ofcontributors ~~the~~to ~~shares~~all ofor ~~our~~any ~~common~~digital ~~stock~~asset ~~may~~network could bepropose ~~affected~~amendments ~~adversely~~to ~~by a reverse stock split given~~ the ~~reduced~~respective ~~number~~network’s ofprotocols ~~shares~~and software that ~~will~~, beif ~~outstanding~~accepted ~~following~~and aauthorized ~~reverse~~by ~~stock~~such ~~split~~network, ~~especially~~could adversely ifaffect the ~~market~~Company’s ~~price~~business, offinancial ~~our~~condition ~~common~~and ~~stock~~results ~~does not increase as a result~~ of ~~the reverse stock split~~operations.

~~Item~~Digital asset networks are open-source projects and, although there 1Bis an influential group of leaders in, for example, the bitcoin network community known as the “Core Developers,” there is no official developer or group of developers that formally controls the bitcoin network. ~~Unresolved~~Any ~~Staff~~individual ~~Comments~~can download the bitcoin network software and make any desired modifications, which are proposed to users and miners on the bitcoin network through software downloads and upgrades, typically posted to the bitcoin development forum on GitHub.com. Proposals for upgrades and discussions relating thereto take place on online forums. For example, there is an ongoing debate regarding altering the blockchain by increasing the size of blocks to accommodate a larger volume of transactions. Although some proponents support an increase, other market participants oppose an increase to the block size as it may deter miners from confirming transactions and concentrate power into a smaller group of miners. To the extent that a significant majority of the users and miners on the bitcoin network install such software upgrade, the bitcoin network would be subject to new protocols and software that may adversely affect the Company’s business, financial condition and results of operations.

~~None~~In the event a developer or group of developers proposes a modification to the bitcoin network that is not accepted by a majority of miners and users, but that is nonetheless accepted by a substantial plurality of miners and users, two or more competing and incompatible blockchain implementations could result. This is known as a “hard fork.” We may not be able to realize the economic benefit of such a “hard fork”, either immediately or ever, which could adversely affect an investment in our securities. If we hold a cryptocurrency at the time of a hard fork, industry standards would dictate that we would be expected to hold an equivalent amount of the old and new assets following the fork. However, we may not be able, or it may not be practical, to secure or realize the economic benefit of the new asset for various reasons. For instance, we may determine that there is no safe or practical way to custody the new asset, that trying to do so may pose an unacceptable risk to our holdings in the old asset, or that the costs of taking possession and/or maintaining ownership of the new cryptocurrency exceed the benefits of owning the new cryptocurrency. Additionally, laws, regulation or other factors may prevent us from benefitting from the new asset even if there is a safe and practical way to custody and secure the new asset. In such case, the “hard fork” in the blockchain could materially and adversely affect the perceived value of digital assets as reflected on one or both incompatible blockchains, which may adversely affect the Company’s business, financial condition and results of operations and, in the worst-case scenario, harm the sustainability of the bitcoin network’s economy.

~~Item 2. Properties~~ 15

~~We provide~~The ~~post~~open-~~harvest~~source ~~and~~structure ~~midstream~~of ~~services~~the tobitcoin ~~growers~~network byprotocol ~~drying,~~means that ~~processing,~~the ~~cleaning,~~contributors ~~stripping~~to ~~harvested~~the ~~hemp~~protocol are generally not directly ~~from~~compensated ~~the~~for ~~field~~their contributions in maintaining and developing the bitcoin network protocol, and ~~wetbaled~~a atfailure ~~our~~to ~~leased~~properly ~~48,000~~monitor ~~square~~and ~~foot~~upgrade ~~facility~~the ~~located~~protocol incould ~~Hopkinsville~~damage the bitcoin network and adversely affect the Company’s business, ~~Kentucky~~financial condition and results of operations.

~~Our~~The bitcoin network operates based on an open-source protocol, not ~~industrial~~represented ~~warehouse~~by an official organization or authority. Instead, it is ~~located~~maintained atby ~~4430~~a ~~Garfield~~group ~~Street~~of core contributors, ~~Denver~~largely on the Bitcoin Core project on GitHub. As an open-source project, ~~Colorado~~bitcoin ~~80216~~is innot represented by an ~~industrial~~official ~~neighborhood~~organization ~~zoned~~or authority. As the bitcoin network protocol is not sold and its use does not generate revenues for ~~cannabis~~contributors, ~~cultivation.~~contributors are generally not directly compensated ~~Properties~~for ~~located~~maintaining inand developing the ~~80216~~bitcoin ~~zip~~network ~~code~~protocol. ~~have~~Although ~~recently~~the ~~had~~Media ~~some~~Lab’s Digital Currency Initiative of the ~~highest~~Massachusetts Institute ~~appreciation~~of ~~rates~~Technology infunds the ~~Denver~~current ~~region~~maintainer ~~due~~Wladimir toJ. ~~significant infrastructure~~van ~~expenditures~~der byLaan, ~~governmental~~among ~~agencies~~others, this type of financial incentive is not typical. The ~~Numerous~~lack ~~warehouses~~of ~~utilized~~guaranteed financial incentive for ~~cannabis~~contributors ~~cultivation~~to ~~are~~maintain ~~located~~or indevelop ~~this~~the ~~industrial district~~bitcoin network and the lack of ~~Denver~~guaranteed resources to adequately address emerging issues with the bitcoin network may reduce incentives to address the issues adequately or in a timely manner.

~~We also~~Changes ~~lease~~to ~~office~~a ~~space~~digital inasset ~~Fort~~network ~~Worth~~which the Company is mining on may adversely affect the Company’s business, ~~Texas~~financial ~~for~~condition ~~managerial~~and ~~offices~~results of operations.

~~Item~~If a malicious actor or botnet obtains control in excess of 50% 3.of ~~Legal~~the ~~Proceedings~~processing power active on any digital asset network, including the bitcoin network, it is possible that such actor or botnet could manipulate the blockchain in a manner that may adversely affect the Company’s business, financial condition and results of operations.

As If a ~~normal~~malicious ~~incident~~actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the ~~businesses~~actions inof ~~which~~the computers) obtains a majority of the ~~Company~~processing ispower ~~engaged,~~dedicated to ~~various~~mining ~~claims~~on any digital asset network, ~~charges~~including ~~and~~the ~~litigation~~bitcoin network, it may be ~~asserted~~able orto ~~commenced from~~alter ~~time~~the toblockchain ~~time~~by ~~against~~constructing ~~the~~alternate blocks ~~Company.~~if ~~With~~it ~~respect~~is able to ~~claims~~solve ~~and~~for ~~litigation~~such ~~currently~~blocks ~~asserted~~faster orthan ~~commenced~~the ~~against~~remainder of the ~~Company,~~miners ~~it is~~on the ~~opinion~~blockchain ofcan ~~management~~add ~~that~~valid ~~final~~blocks. ~~judgments,~~In ifsuch alternate ~~any~~blocks, ~~which~~the ~~might~~malicious beactor ~~rendered~~or ~~against~~botnet ~~the~~could ~~Company~~control, ~~are~~exclude ~~adequately~~or ~~reserved~~modify ~~for,~~the ~~are covered~~ordering byof ~~insurance~~transactions, orthough ~~are~~it could not ~~likely~~generate new todigital ~~have~~assets aor ~~material~~transactions ~~adverse~~using ~~effect~~such oncontrol. Using alternate blocks, the ~~Company’s~~malicious ~~financial~~actor ~~condition~~could or“double-spend” ~~results~~its own ofdigital ~~operations~~assets (i. ~~Nevertheless~~e., ~~given~~spend the ~~uncertainties~~same digital assets in more than one transaction) and prevent the confirmation of ~~litigation,~~other users’ transactions for so long as it ismaintains ~~possible~~control. To the extent that ~~certain~~such ~~types~~malicious ofactor ~~claims,~~or ~~charges~~botnet ~~and~~does ~~litigation~~not ~~could~~yield ~~have~~its amajority control ~~material~~of ~~adverse~~the ~~impact~~processing onpower or the ~~Company;~~digital ~~see~~asset ~~Item~~community ~~1A,~~does ~~“Risk~~not ~~Factors.”~~reject ~~See~~the ~~Note~~fraudulent 7blocks as malicious, reversing any changes made to the ~~consolidated~~blockchain ~~financial~~may ~~statements included~~not inbe ~~this~~possible, ~~annual~~which ~~report~~may ~~for~~adversely ~~additional~~affect ~~information~~the ~~relating~~Company’s tobusiness, ~~legal~~financial ~~matters~~condition and results of operations.

~~Item~~The approach towards and possible crossing of the 50% threshold indicates 4a greater risk that a single mining pool could exert authority over the validation of digital asset transactions. ~~Mine~~To ~~Safety~~the ~~Disclosures~~extent that the digital assets ecosystems do not act to ensure greater decentralization of digital asset mining processing power, the feasibility of a malicious actor obtaining in excess of 50% of the processing power on any digital asset network (e.g., through control of a large mining pool or through hacking such a mining pool) will increase, which may adversely affect the Company’s business, financial condition and results of operations.

~~Not~~If the award of digital assets for solving blocks and transaction ~~applicable~~fees for recording transactions are not sufficiently high to cover expenses related to running data center operations, it may adversely affect the Company’s business, financial condition and results of operations.

15Bitcoin miners record transactions when they solve for and add blocks of information to the blockchain. When a miner solves for a block, it creates such block, which includes data relating to (i) the solution to the block, (ii) a reference to the prior block in the blockchain to which the new block is being added and (iii) all transactions that have occurred but have not yet been added to the blockchain. The miner becomes aware of outstanding, unrecorded transactions through data packet transmission and propagation. Typically, bitcoin transactions will be recorded in the next chronological block if the spending party has an internet connection and at least one minute has passed between the transaction’s data packet transmission and the solution of the next block. If a transaction is not recorded in the next chronological block, it is usually recorded in the next block thereafter.

~~PART II~~As the award of new digital assets for solving blocks declines, and if transaction fees are not sufficiently high, miners may not have an adequate incentive to continue mining and may cease their mining operations. For example, the current fixed reward on the bitcoin network for solving a new block is six and a quarter (6.25) bitcoins per block. The reward decreased from twelve and a half (12.5) bitcoins in May 2020. It is estimated that it will halve again in approximately May 2024. This reduction may result in a reduction in the aggregate hashrate of the bitcoin network as the incentive for miners will decrease. Moreover, miners ceasing operations would reduce the aggregate hashrate on the bitcoin network, which would adversely affect the confirmation process for transactions (i.e., temporarily decreasing the speed at which blocks are added to the blockchain until the next scheduled adjustment in difficulty for block solutions) and make the bitcoin network more vulnerable to a malicious actor obtaining control in excess of 50% of the aggregate hashrate on the bitcoin network. Periodically, the bitcoin network has adjusted the difficulty for block solutions so that solution speeds remain in the vicinity of the expected ten-minute confirmation time targeted by the bitcoin network protocol.

~~Item 5. Market for Registrant’s Common Equity and Related Shareholder Matters.~~16

~~Our common~~The ~~stock~~Company isbelieves ~~quoted~~that onfrom ~~OTCQB~~time ~~under~~to ~~the~~time ~~symbol~~there ~~“GENH.”~~will Inbe ~~the~~further ~~future,~~considerations and ~~should~~adjustments weto ~~meet~~the ~~stringent~~bitcoin ~~qualifications~~network and ~~pay~~others regarding the ~~required~~ ~~fee, we~~difficulty ~~plan~~for toblock ~~have~~solutions. ~~our~~More ~~shares~~significant ~~quoted~~reductions in aggregate hashrate on ~~Capital~~digital ~~Markets~~asset ~~tier~~networks ofcould ~~NASDAQ~~result in material, ~~however~~though ~~here~~temporary, isdelays noin ~~assurance~~block ~~that~~solution ~~our~~confirmation ~~shares~~time. Any reduction ~~will~~in ~~continue~~confidence toin bethe ~~quoted~~confirmation onprocess or aggregate hashrate of any ~~market~~digital asset network may negatively impact the value of digital assets, which may adversely affect the Company’s business, financial condition and results of operations.

~~Shareholders~~To the extent that the profit margins of digital asset mining operations are not high, operators of digital asset mining operations are more likely to immediately sell their digital assets earned by mining in the digital asset exchange market, resulting in a reduction in the price of digital assets that may adversely affect the Company’s business, financial condition and results of operations.

AsOver the past ten years, digital asset mining operations have evolved from individual users mining with computer processors, graphics processing units and first-generation servers. Currently, new processing power brought onto the digital asset networks is predominantly added by incorporated and unincorporated “professionalized” mining operations. Professionalized mining operations may use proprietary hardware or sophisticated machines. They require the investment of significant capital for the ~~date~~acquisition of this ~~report~~hardware, ~~there~~the ~~were~~leasing 76of ~~direct~~operating ~~holders~~space of(often ~~our~~in ~~common~~data ~~shares~~centers asor ~~shown~~warehousing onfacilities), incurrence of electricity costs and the ~~list~~employment ~~maintained~~of bytechnicians ~~our~~to ~~transfer~~operate ~~agent~~the mining farms. As a result, professionalized mining operations Weare ~~may~~of a greater scale than prior miners and have amore ~~substantial~~defined, ~~number~~regular ofexpenses ~~additional~~and ~~shareholders~~liabilities. ~~who~~These ~~hold~~regular ~~shares~~expenses and liabilities require professionalized mining operations to more immediately sell digital assets earned from mining operations on the digital asset exchange market, whereas it is believed that individual miners in ~~street~~past ~~name~~years were more likely to hold newly mined digital assets for more extended periods. The immediate selling of newly mined digital assets greatly increases the supply of digital assets on the digital asset exchange market, creating downward pressure on the price of each digital asset.

~~Dividends~~The extent to which the value of digital assets mined by a professionalized mining operation exceeds the allocable capital and operating costs determines the profit margin of such operation. A professionalized mining operation may be more likely to sell a higher percentage of its newly mined digital assets rapidly if it is operating at a low profit margin and it may partially or completely cease operations if its profit margin is negative. This could create a network effect that may further reduce the price of digital assets until mining operations with higher operating costs become unprofitable and remove mining power from the respective digital asset network. The network effect of reduced profit margins resulting in greater sales of newly mined digital assets could result in a reduction in the price of digital assets that may adversely affect the Company’s business, financial condition and results of operations.

WeTo the extent that any miners cease to record transactions in ~~have~~solved blocks, transactions that do not ~~declared~~include orthe ~~paid~~payment ~~any~~of ~~cash~~a ~~dividends~~transaction fee will not be recorded on ~~our~~the ~~common~~blockchain ~~stock.~~until Toa ~~date~~block is wesolved ~~have~~by ~~utilized~~a ~~all~~miner ~~available~~who ~~cash~~does tonot ~~finance~~require ~~our~~the ~~operations. Payment~~payment of ~~cash~~transaction ~~dividends~~fees, inand ~~the~~any ~~future~~widespread ~~will~~delays bein at the ~~discretion~~recording of ~~our~~transactions could ~~Board~~result ofin ~~Directors~~a ~~and~~loss ~~will~~of ~~depend~~confidence ~~upon~~in ~~our~~that ~~earnings~~digital ~~levels, capital~~asset ~~requirements~~network, ~~any~~which ~~restrictive~~may ~~loan~~adversely ~~covenants~~affect ~~and~~the ~~other~~Company’s ~~factors~~business, ~~the~~financial condition ~~Board~~and ~~considers~~results ~~relevant~~of operations.

~~Warrants~~To the extent that any miners cease to record transactions in solved blocks, such transactions will not be recorded on the blockchain. Currently, there are no known incentives for miners to elect to exclude the recording of transactions in solved blocks. However, to the extent that any such incentives arise (e.g., a collective movement among miners or one or more mining pools forcing bitcoin users to pay transaction fees as a substitute for or in addition to the award of new bitcoins upon the solving of a block), actions of miners solving a significant number of blocks could delay the recording and confirmation of transactions on the blockchain. Any systemic delays in the recording and confirmation of transactions on the blockchain could result in greater exposure to double-spending transactions, or transactions that consist of bad actors simultaneously sending two or more bitcoin to different addresses, and a loss of confidence in certain or all digital asset networks, which may adversely affect the Company’s business, financial condition and results of operations.

~~At December~~Intellectual ~~31,~~property ~~2021,~~rights ~~there~~claims ~~were~~may ~~8,808,333~~adversely ~~warrants~~affect ~~outstanding for~~ the operation ~~purchase~~ of ~~Company~~some ~~common~~or ~~stock.~~all ~~Refer~~digital toasset ~~Note 9 to the consolidated financial statements included in this annual report for additional information relating to outstanding warrants~~networks.

~~Equity~~Third parties may assert intellectual property claims relating to the ~~Compensation~~holding ~~Plans~~and transfer of digital assets and their source code. Regardless of the merit of any intellectual property or other legal action, any threatened action that reduces confidence in some or all digital asset networks’ long-term viability or the ability of end-users to hold and transfer digital assets may adversely affect the Company’s business, financial condition and results of operations. In addition, a meritorious intellectual property claim could prevent the Company and other end-users from accessing some or all digital asset networks or holding or transferring their digital assets. As a result, an intellectual property claim against the Company or other large digital asset network participants may adversely affect the Company’s business, financial condition and results of operations.

The 2021 Omnibus Incentive Plan (“2021 Plan”) was adopted by our Board on July 1, 2021. The 2021 Plan provides for the initial reservation of 15 million shares of common stock for issuance, and provides that the maximum number of shares that may be issued pursuant to the exercise of ISOs is 15 million. The number of shares of common stock available for issuance under the 2021 Plan constituted approximately 13.1% of the Company’s fully diluted common shares outstanding as of the date of Board approval, including shares issuable upon the conversion of preferred shares, as calculated on an as-converted basis. On the one-year anniversary date of the 2021 Plan, the number of shares of common stock reserved for issuance thereunder shall automatically increase to 20% of the fully diluted common shares outstanding, including shares issuable upon the conversion of preferred shares, as calculated on an as-converted basis.17

~~At December~~To ~~31,~~the ~~2021,~~extent ~~there~~that ~~were~~the ~~13,850,000~~digital ~~options~~asset ~~outstanding~~exchanges ~~for~~representing ~~the~~a substantial ~~purchase~~portion of ~~Company~~the ~~common~~volume ~~stock.~~in ~~Refer~~digital toasset ~~Note~~trading 10are toinvolved ~~the~~in ~~consolidated~~fraud or experience security failures or other operational ~~financial~~issues, ~~statements~~such ~~included~~digital asset exchanges’ failures may result in ~~this~~a ~~annual~~reduction ~~report~~in ~~for~~the ~~additional~~price ~~information~~of ~~relating~~some toor ~~outstanding~~all ~~options~~digital assets and may adversely affect the Company’s business, financial condition and results of operations.

~~Recent~~The digital asset exchanges on which the digital assets trade are new ~~Sales~~and, in most cases, largely unregulated. Furthermore, many digital asset exchanges (including several of ~~Unregistered~~the ~~Securities~~most prominent U.S. dollar denominated digital asset exchanges) do not provide the public with significant information regarding their ownership structure, management teams, corporate practices or regulatory compliance. As a result, the marketplace may lose confidence in, or may experience problems relating to, digital asset exchanges, including prominent exchanges handling a significant portion of the volume of digital asset trading. A lack of stability in the digital asset exchange market and the closure or temporary shutdown of digital asset exchanges due to fraud, business failure, hackers or malware or government-mandated regulation may reduce confidence in the digital asset networks and result in greater volatility in digital asset values. These potential consequences of a digital asset exchange’s failure may adversely affect the Company’s business, financial condition and results of operations.

~~Since~~Political or economic crises may motivate large-scale sales of ~~January~~digital 1assets, ~~2021,~~which wecould ~~have~~result ~~sold~~in ~~securities~~a reduction in ~~private~~some ~~transactions~~or ~~without~~all ~~registering~~digital ~~the~~assets’ ~~securities~~values ~~under~~and adversely affect the ~~Securities~~Company’s business, ~~Act~~financial ascondition ~~shown below:~~and results of operations.

●As ~~Acquisition~~an alternative to fiat currencies that are backed by central governments, digital assets such as bitcoins, which are relatively new, are subject to supply and demand forces based upon the desirability of ~~Certain~~an ~~Assets~~alternative, decentralized means of ~~Halcyon~~buying –and Inselling ~~January~~goods ~~2021~~and services, and it is unclear how such supply and demand will be impacted by geopolitical events. Nevertheless, political or economic crises, including current or anticipated military conflicts such as the ~~Company~~war ~~issued~~between 6Russia and Ukraine,~~250~~ terrorism,~~000~~ ~~shares~~sanctions or other geopolitical events globally, may motivate large-scale acquisitions or sales of ~~common~~digital ~~stock~~assets either ~~valued~~globally ator $2locally.5 ~~million~~Large-scale ~~($0.40~~sales ~~per~~of ~~share;~~digital ~~restricted~~assets ~~from~~would ~~trading~~result ~~for~~in a ~~period~~reduction ofin upsome toor ~~one~~all ~~year)~~digital inassets’ values and may adversely affect the ~~acquisition~~Company’s business, financial condition and results of operations.

●The ~~2021 First Quarter Issuances of Common Stock Units – In the first quarter of 2021, the~~ Company’s ~~issued~~ability ~~800,000~~to ~~common~~adopt ~~stock~~technology ~~units~~in ~~for~~response ~~total~~to changing ~~proceeds~~security ofneeds ~~$400,000.~~or ~~Each~~trends ~~common~~poses ~~stock unit consists of one share of common stock and~~ a ~~warrant~~challenge ~~for~~to the ~~purchase~~safekeeping of ~~two shares of common stock for $0.50 each. Each warrant is exercisable any time before its expiration on~~ the ~~second anniversary of its issuance. The~~ Company’s ~~allocated~~digital ~~the total proceeds based on the relative fair values of the common stock and warrants~~assets. The fair value of the warrants was determined using an options valuation model with key assumptions including a risk-free interest rate of 0.11% and historical volatility of 272%. A total of $263,293 was allocated to the warrants and reported in additional paid-in capital.

16The history of digital asset exchanges has shown that exchanges and large holders of digital assets must adapt to technological change in order to secure and safeguard their digital assets. The Company will rely on enterprise cold storage solutions from third parties to safeguard the Company’s digital assets from theft, loss, destruction or other issues relating to hackers and technological attack. The Company’s digital assets may also be moved to various exchanges in order to exchange them for fiat currency during which time the Company will be relying on the security of such exchanges to safeguard the Company’s digital assets.

●The ~~Warrant~~Company ~~Exercises~~believes –that Init ~~the~~may ~~first~~become ~~quarter~~a more appealing target of security ~~2021,~~threats as the size of the Company’s ~~received~~bitcoin ~~$2,967,000~~holdings ~~for~~grow. To the ~~exercise~~extent ofthat ~~8,428,976~~either ~~outstanding~~custody ~~warrants.~~providers Inor the ~~fourth~~Company are ~~quarter~~unable ofto ~~2021~~identify and mitigate or stop new security threats, the Company’s ~~received~~digital ~~$375,000~~assets ~~for~~may ~~the~~be ~~exercise~~subject ofto 1theft,~~065~~ loss,~~340~~ ~~outstanding~~destruction or ~~warrants~~other attack, which may adversely affect the Company’s business, financial condition and results of operations.

●Digital ~~Issuances~~asset ~~for~~transactions ~~Exchange~~are irrevocable, and stolen or ~~Conversion~~incorrectly transferred ofdigital ~~Debt~~assets –may ~~The~~be ~~Company~~irretrievable ~~issued~~and, as a ~~total~~result, ofany ~~1,618,660~~incorrectly ~~common~~executed ~~shares~~digital ~~for~~asset transactions may adversely affect the ~~exchange~~Company’s orbusiness, ~~conversion~~financial ofcondition ~~outstanding~~and ~~debt~~results of operations.

●Digital ~~Issuance~~asset transactions are not, from an administrative perspective, reversible without the consent and active participation of the recipient of the transaction or, in theory, control or consent of a majority of the processing power on the respective digital asset network. Once a transaction has been verified and recorded in a block that is added to ~~Vendor~~the blockchain, an incorrect transfer of digital assets or a theft of digital assets generally will not be reversible, and the Company may not be capable of seeking compensation for ~~Services~~any –such Intransfer or theft. Although the ~~third~~Company’s ~~quarter~~transfers of ~~2021~~digital assets will regularly be made to or from various parties, it is possible that, through computer or human error, or through theft or criminal action, the Company’s ~~issued~~digital ~~125,000~~assets ~~common~~could ~~shares~~be transferred in incorrect amounts or to unauthorized third parties. To the extent that the Company is unable to seek a ~~vendor~~corrective transaction with such third party or is incapable of identifying the third party which has received the Company’s digital assets through error or theft, the Company will be unable to revert or otherwise recover incorrectly transferred digital assets. To the extent that the Company is unable to seek redress for ~~services~~such ~~performed~~error or theft, such loss may adversely affect the Company’s business, financial condition and results of operations.

●The ~~Issuance~~limited ~~for~~rights ~~Extension~~ of ~~Secured~~legal ~~Note~~recourse –against ~~The~~the Company, ~~issued~~and the 20Company’s lack of insurance protection,~~000~~ ~~common~~expose ~~shares~~the asCompany ~~consideration~~and toits ~~extend~~stockholders to the ~~maturity~~risk of aloss ~~senior~~of ~~note~~its indigital ~~the~~assets ~~third~~for which ~~quarter~~no ofperson ~~2021~~is liable.

●The ~~Issuance~~digital ~~for~~assets ~~Conversion~~held ofby ~~Series~~the ACompany ~~Preferred~~may ~~Stock~~not –be Asinsured. ~~noted above~~Therefore, a inloss ~~the~~may ~~third~~be ~~quarter~~suffered ofwith ~~2021,~~respect to the Company’s ~~issued~~digital ~~75,947,376~~assets ~~common~~which ~~shares~~is not covered by insurance and for ~~the~~which ~~conversion~~no ofperson ~~all~~is liable ~~outstanding~~in ~~shares~~damages, ofwhich ~~its~~may ~~Series~~adversely Aaffect ~~Preferred~~the ~~Stock~~Company’s business, financial condition and results of operations.

	●	2021 Fourth Quarter Issuances of Common Stock Units – In the fourth quarter of 2021, the Company issued 958,333 common stock units to accredited investors for total proceeds of $575,000. Each common stock unit consists of one share of common stock and a warrant for the purchase of one share of common stock for $0.60 each. Each warrant is exercisable any time before its expiration on the second anniversary of its issuance. The Company allocated the total proceeds based on the relative fair values of the common stock and warrants. The fair value of the warrants was determined using an options valuation model with key assumptions including risk-free interest rates ranging from 0.48% to 0.70% and historical volatility ranging from 237% to 258%. A total of $276,947 was allocated to the warrants and reported in additional paid-in capital
	●	Stock-based Compensation – The Company issued 500,000 restricted common shares as incentive compensation to two executives who joined the Company in the first quarter of 2021.

~~Purchases~~ The Company may not have adequate sources of ~~Equity~~recovery ~~Securities~~if byits digital ~~the~~assets ~~Issuer~~are ~~and~~lost, ~~Affiliated~~stolen ~~Purchasers~~or destroyed.

WeIf the Company’s digital assets are lost, stolen or destroyed ~~made~~under nocircumstances ~~purchases~~rendering a party liable to the Company, the responsible party may not have the financial resources sufficient to satisfy its claim. For example, as to a particular event of ~~our~~loss, ~~equity~~the ~~securities~~only source of recovery for the Company might be limited, to the extent identifiable, other responsible third parties (e.g., a thief or terrorist), any of which may not have the financial resources (including liability insurance coverage) to satisfy a valid claim by the Company.

~~Our~~Digital assets held by the Company are not subject to FDIC or ~~Transfer~~SIPC ~~Agent~~protections.

WeThe Company will not hold its digital assets with a banking institution ~~have~~or ~~retained~~a ~~Securities~~member ~~Transfer~~of the Federal Deposit Insurance Corporation (“~~STC~~FDIC”), ~~Plano,~~or ~~Texas,~~the asSecurities ~~transfer~~Investor ~~agent~~Protection ~~for~~Corporation ~~our~~(“SIPC”) and, ~~Common~~therefore, ~~shares.~~its ~~Shareholders are~~digital ~~responsible~~assets towill ~~contact~~not ~~STC~~be subject to ~~update~~the ~~their address.~~protections ~~This~~enjoyed ~~may~~by bedepositors ~~done~~with byFDIC ~~contacting:~~or SIPC member institutions.

~~Securities~~The loss or destruction of a private key required to access a ~~Transfer~~digital ~~Corporation~~asset may be irreversible and, as a result, the Company’s loss of access to its private keys or its experience of a data loss relating to its digital assets may adversely affect the Company’s business, financial condition and results of operations.

~~2901~~Digital assets are controllable only by the possessor of both the unique Npublic key and private key relating to the local or online digital wallet in which the digital assets are held. ~~Dallas~~The ~~Parkway~~Company is required by the operation of digital asset networks to publish the public key relating to a digital wallet in use when it first verifies a spending transaction from that digital wallet and disseminates such information into the respective network. The Company safeguards and keeps private the private keys relating to its digital assets by using enterprise cold storage custody solutions from third parties. To the extent a private key is lost, ~~Suite~~destroyed ~~380~~or otherwise compromised and no backup of the private key is accessible, the Company will be unable to access the digital assets held by it and the private key will not be capable of being restored by the respective digital asset network. Any loss of private keys relating to digital wallets used to store the Company’s digital assets may adversely affect the Company’s business, financial condition and results of operations.

~~Plano,~~Because the Company’s future digital assets may be held ~~Texas~~by ~~75093~~digital asset exchanges, it faces heightened risks from cybersecurity attacks and financial stability of digital asset exchanges.

~~Phone:~~The Company may transfer digital assets from its wallet to digital ~~(469)~~asset ~~633~~exchanges prior to selling them. Digital assets not held in the Company’s wallet are subject to the risks encountered by digital asset exchanges including a denial-~~0101~~of-service attack or other malicious hacking, a sale of the digital asset exchange, loss of the digital assets by the digital asset exchange and other risks similar to those described herein. The Company may not maintain a custodian agreement with any of the digital asset exchanges that hold the Company’s digital assets. These digital asset exchanges may or may not provide insurance and may lack the resources to protect against hacking and theft. If this were to occur, the Company’s business, financial condition and results of operations may be adversely affected.

~~Fax:~~As the number of digital assets awarded for solving a block in ~~(469)~~the ~~633-0088~~blockchain decreases, the incentive for miners to continue to contribute processing power to the respective digital asset network will transition from a set reward to transaction fees.

~~www~~In order to incentivize miners to continue to contribute processing power to any digital asset network, such network may either formally or informally transition from a set reward to transaction fees earned upon solving for a block.~~stctransfer~~ This transition could be accomplished either by miners independently electing to record in the blocks they solve only those transactions that include payment of a transaction fee or by the digital asset network adopting software upgrades that require the payment of a minimum transaction fee for all transactions.~~com~~ If transaction fees paid for digital asset transactions become too high, the marketplace may be reluctant to accept digital assets as a means of payment and existing users may be motivated to switch from one digital asset to another digital asset or back to fiat currency. Decreased use and demand for bitcoins may adversely affect the value of the Company’s bitcoins and may adversely affect the Company’s business, financial condition and results of operations.

~~STC is~~The ~~responsible~~price ~~for~~of ~~all~~bitcoin ~~record-keeping~~may be influenced by regulatory, commercial and ~~administrative~~technical ~~functions~~factors that are highly uncertain resulting in ~~connection~~the ~~with~~price ~~our~~of bitcoin being extremely volatile, which may significantly influence the market price of the Company’s common ~~shares~~stock.

~~Item~~To the extent investors view the value of the Company’s common 6stock as linked to the value or change in the value of bitcoin, fluctuations in the price of bitcoin may significantly influence the market price of the Company’s common stock. ~~Reserved~~In addition, the Company’s business operations are no longer economical below the bitcoin breakeven point, or the point at which the total cost of mining operations exceeds the total revenues generated.

~~Not~~The price of bitcoin has historically been subject to dramatic fluctuations ~~applicable~~and is highly volatile. Bitcoin has only recently become accepted as a means of payment for goods and services and has recently trended toward becoming a more actively traded instrument, however the acceptance and use of bitcoin remains limited and far from mainstream. Conversely, a significant portion of demand for bitcoin may be generated by speculators and investors seeking to profit from the short- or long-term holding of bitcoin.

1719

In addition, some blockchain industry participants have reported that a significant percentage of bitcoin trading activity is artificial or non-economic in nature and may represent attempts to manipulate the price of bitcoin. As a result, trading platforms may seek to inflate demand for bitcoin, which could increase the volatility of the price of bitcoin and may significantly influence the market price of the Company’s common stock.

The development and acceptance of competing blockchain platforms or technologies may cause consumers to use alternative distributed ledgers or other alternatives.

The development and acceptance of competing blockchain platforms or technologies, including competing cryptocurrencies which our miners may not be able to mine, such as cryptocurrencies being developed by popular social media platforms, online retailers, or government sponsored cryptocurrencies, may cause consumers to use alternative distributed ledgers or an alternative to distributed ledgers altogether. Our business currently intends to utilize presently existent digital ledgers and blockchains and we could face difficulty adapting to emergent digital ledgers, blockchains, or alternatives thereto. This may adversely affect us and our exposure to various blockchain technologies and prevent us from realizing the anticipated profits from our investments. Such circumstances could have a material adverse effect on our business, prospects or operations and potentially the value of any bitcoin or other cryptocurrencies we mine or otherwise acquire or hold for our own account, which could materially and adversely affect investors’ investments in our securities.

The decentralized nature of cryptocurrency systems may lead to slow or inadequate responses to crises, which may negatively affect our business.

The decentralized nature of the governance of cryptocurrency systems may lead to ineffective decision making that slows development or prevents a network from overcoming emergent obstacles. Governance of many cryptocurrency systems is by voluntary consensus and open competition with no clear leadership structure or authority. To the extent lack of clarity in corporate governance of cryptocurrency systems leads to ineffective decision making that slows development and growth of such cryptocurrencies, the value of our common stock may be adversely affected.

Risks Relating to Regulatory Matters

We are subject to a highly-evolving regulatory landscape and any adverse changes to, or our failure to comply with, any laws and regulations could adversely affect our business, reputation, prospects or operations.

Until recently, relatively little regulatory attention has been directed toward bitcoin and the bitcoin network by U.S. federal and state governments, foreign governments and self-regulatory agencies. We currently only operate in the United States, and do not currently have any plans to expand our operations beyond the United States. As bitcoin has grown in popularity and in market size, the U.S. regulatory regime - namely the Federal Reserve Board, U.S. Congress and certain U.S. agencies (e.g., the SEC, the CFTC, FinCEN and the Federal Bureau of Investigation) have begun to examine the operations of the bitcoin network, bitcoin users and the bitcoin exchange market. The complexity and evolving nature of our business and the significant uncertainty surrounding the regulation of the cryptocurrency industry requires us to exercise our judgment as to whether certain laws, rules, and regulations apply to us, and it is possible that governmental bodies and regulators may disagree with our conclusions. To the extent we have not complied with such laws, rules, and regulations, we could be subject to significant fines, revocation of licenses, limitations on our products and services, reputational harm, and other regulatory consequences, each of which may be significant and could adversely affect our business, operating results, and financial condition.

Additionally, the recent bankruptcy filings of FTX, the third largest digital asset exchange by volume at the time of its filing, and its affiliated hedge fund Alameda Research LLC, in addition to other bankruptcy filings of crypto companies throughout calendar year 2022 and the first quarter of 2023, together with the recent closures of Silicon Valley Bank, SBNY and Silvergate Bank, will likely attract heightened regulatory scrutiny from U.S. regulatory agencies such as the SEC and CFTC. Increasing regulation and regulatory scrutiny may result in new costs for the Company and Company’s management having to devote increased time and attention to regulatory matters, change aspects of the Company’s business or result in limits on the utility of bitcoin. In addition, regulatory developments and/or the Company’s business activities may require the Company to comply with certain regulatory regimes. Increasingly strict legal and regulatory requirements and any regulatory investigations and enforcement may result in changes to our business, as well as increased costs, and supervision and examination for ourselves and our service providers. Moreover, new laws, regulations, or interpretations may result in additional litigation, regulatory investigations, and enforcement or other actions. Adverse hanges to, or our failure to comply with, any laws and regulations may have an adverse effect on our reputation and brand and our business, operating results, and financial condition.

Additionally, although we are not directly connected to the recent cryptocurrency market events, we may still suffer reputational harm due to our association with the cryptocurrency industry in light of the recent disruption in the crypto asset markets. Ongoing and future regulation and regulatory actions could significantly restrict or eliminate the market for or uses of bitcoin and/or may adversely affect the Company’s business, reputation, financial condition and results of operations.

TeraWulf may be at a higher risk of litigation and other legal proceedings due to heightened regulatory scrutiny of the cryptocurrency industry, which could ultimately be resolved against TeraWulf, requiring material future cash payments or charges, which could impair TeraWulf’s financial condition and results of operations.

The size, nature and complexity of the Company’s business could make it susceptible to various claims, both in litigation and binding arbitration proceedings, legal proceedings, and government investigations, due to the heightened regulatory scrutiny following the recent disruptions in the crypto asset markets. The Company believes that since cryptocurrency mining, and the digital asset industry generally, is a relatively new business sector, it is more likely subject to government investigation and regulatory determination, particularly following the recent cryptocurrency market participant bankruptcies described elsewhere herein. Any claims, regulatory proceedings or litigation that could arise in the course of the Company’s business could have a material adverse effect on the Company, its business or operations, or the industry as a whole.

The Company may be classified as an inadvertent investment company.

The Company is not engaged in the business of investing, reinvesting or trading in securities and does not hold itself out as being engaged in those activities. Under the Investment Company Act, however, a company may be deemed an investment company under Section 3(a)(1)(C) if the value of its investment securities is more than 40% of its total assets (exclusive of government securities and cash items) on a consolidated basis.

The Company will be engaging in digital asset mining, the outputs of which are cryptocurrencies, which may be deemed a security. In the event that the digital assets held by the Company exceed 40% of its total assets, exclusive of cash, the Company may inadvertently become an investment company. An inadvertent investment company can avoid being classified as an investment company if it can rely on one of the exclusions under the Investment Company Act. One such exclusion, namely Rule 3a-2 under the Investment Company Act, allows an inadvertent investment company a grace period of one year from the earlier of (i) the date on which an issuer owns securities and/or cash having a value exceeding 50% of the issuer’s total assets on either a consolidated or unconsolidated basis and (ii) the date on which an issuer owns or proposes to acquire investment securities having a value exceeding 40% of the value of such issuer’s total assets (exclusive of government securities and cash items) on an unconsolidated basis. The Company is putting in place policies that it expects will work to keep the digital assets held by the Company at less than 40% of its total assets, liquidating its digital assets or seeking a no-action letter from the SEC if the Company is unable to maintain sufficient total assets or liquidate sufficient digital assets in a timely manner.

As Rule 3a-2 is available to a company no more than once every three years, and assuming no other exclusions are available to the Company, the Company would have to keep within the 40% limit for at least three years after it ceases being an inadvertent investment company. This may limit the Company’s ability to make certain investments or enter into joint ventures that could otherwise have a positive impact on the Company’s earnings. In any event, the Company does not intend to become an investment company engaged in the business of investing and trading securities.

Classification as an investment company under the Investment Company Act requires registration with the SEC. If an investment company fails to register, it would have to stop doing almost all business, and its contracts would become voidable. Registration is time consuming and restrictive and would require a restructuring of the Company’s operations, and the Company would be very constrained in the kind of business it could do as a registered investment company. Furthermore, the Company would become subject to substantial regulation concerning management, operations, transactions with affiliated persons and portfolio composition, and would need to file reports under the Investment Company Act regime. The cost of such compliance would result in the Company incurring substantial additional expenses, and the failure to register if required may adversely affect the Company’s business, financial condition and results of operations.

It may be illegal now, or in the future, to acquire, own, hold, sell or use digital assets in one or more countries, and ownership of, holding or trading in the Company’s securities may also be considered illegal and subject to sanction.

Although digital assets are not currently regulated or are lightly regulated in most countries, including the United States, one or more countries, such as China and Russia, may take regulatory actions in the future that severely restricts the right to acquire, own, hold, sell or use digital assets or to exchange digital assets for fiat currency. Such an action may also result in the restriction of ownership, holding or trading in the Company’s securities and may adversely affect the Company’s business, financial condition and results of operations.

If regulatory changes or interpretations of the Company’s activities require its registration as a money services business under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act of 1970, as amended, the Company may be required to register and comply with such regulations.

To the extent that the activities of the Company cause it to be deemed a money service business under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act of 1970, as amended, the Company may be required to comply with FinCEN regulations, including those that would mandate the Company to implement anti-money laundering programs, make certain reports to FinCEN and maintain certain records.

To the extent that the activities of the Company cause it to be deemed a “money transmitter” or equivalent designation under state law of any state in which the Company operates, the Company may be required to seek a license or otherwise register with a state regulator and comply with state regulations that may include the implementation of anti-money laundering programs, maintenance of certain records and other operational requirements. Currently, the New York State Department of Financial Services has finalized its “BitLicense” framework for businesses that conduct “virtual currency business activity,” the Conference of State Bank Supervisors has proposed a model form of state level “virtual currency” regulation and additional state regulators, including those from the States of California, Idaho, Virginia, Kansas, Texas, South Dakota and Washington, have made public statements indicating that virtual currency businesses may be required to seek licenses as money transmitters. In July 2016, the State of North Carolina updated the law to define “virtual currency” and the activities that trigger licensure in a business-friendly approach that encourages companies to use virtual currency and blockchain technology. Specifically, the North Carolina law does not require miners or software providers to obtain a license for multi-signature software, smart contract platforms, smart property, colored coins and non-hosted, non-custodial wallets. Starting on January 1, 2016, the State of New Hampshire requires anyone who exchanges a digital currency for another currency must become a licensed and bonded money transmitter. In numerous other states, including the States of Connecticut and New Jersey, legislation is being proposed or has been introduced regarding the treatment of bitcoin and other digital assets. The Company will continue to monitor for developments in such legislation, guidance or regulations.

Such additional federal or state regulatory obligations may cause the Company to incur extraordinary expenses, possibly affecting an investment in the shares of the Company’s common stock in a material and adverse manner. Furthermore, the Company and its service providers may not be capable of complying with certain federal or state regulatory obligations applicable to money services business and money transmitters. If the Company is deemed to be subject to and is determined not to comply with such additional regulatory and registration requirements, the Company may act to dissolve and liquidate the Company.

Blockchain technology may expose the Company to specially designated nationals or blocked persons or cause it to violate provisions of law.

The Company is subject to the rules enforced by The Office of Financial Assets Control of the U.S. Department of Treasury (“OFAC”), including regarding sanctions and requirements not to conduct business with persons named on its specially designated nationals list. However, because of the pseudonymous nature of blockchain transactions, the Company may inadvertently and without its knowledge engage in transactions with persons named on OFAC’s specially designated nationals list, which may expose the Company to regulatory sanctions and adversely affect the Company’s business, financial condition and results of operations.

The Company may be required to register and comply with bitcoin regulations and, to the extent that the Company decides to continue operations, the required registrations and regulatory compliance steps may result in extraordinary expenses to the Company.

Current and future legislation, and other regulatory developments, including interpretations released by a regulatory authority, may impact the manner in which bitcoins are treated for classification and clearing purposes. In particular, bitcoin derivatives are not excluded from the definition of “commodity future” by the CFTC. The Company cannot be certain as to how future regulatory developments will impact the treatment of bitcoins under the law.

Bitcoins have been deemed to fall within the definition of a commodity, and the Company may be required to register and comply with additional regulation under the Commodity Exchange Act of 1936, as amended, including additional periodic report and disclosure standards and requirements. Moreover, the Company may be required to register as a commodity pool operator and to register us as a commodity pool with the CFTC through the National Futures Association. Such additional registrations may result in extraordinary expenses, thereby materially and adversely affecting the Company’s business, financial condition and results of operations. If the Company determines it will not comply with such additional regulatory and registration requirements, it may seek to cease certain of its operations. Any such action may adversely affect the Company’s business, financial condition and results of operations. As of the date of this Annual Report, the Company is not aware of any rules that have been proposed to regulate bitcoins as securities. However, the Company cannot be certain as to how future regulatory developments will impact the treatment of bitcoins under the law.

If federal or state legislatures or agencies initiate or release tax determinations that change the classification of bitcoins as property for tax purposes (in the context of when such bitcoins are held as an investment), such determination could have a negative tax consequence on the Company or its shareholders.

Current guidance from the Internal Revenue Service indicates that digital assets such as bitcoin should be treated and taxed as property and that transactions involving the payment of bitcoin for goods and services should be treated as barter transactions. While this treatment creates a potential tax reporting requirement for any circumstance where the ownership of a bitcoin passes from one person to another, usually by means of bitcoin transactions (including off-blockchain transactions), it would also apply capital gains treatment to those transactions which may adversely affect the Company’s business, financial condition and results of operations.

Under certain recently proposed legislation, substantial tax compliance burdens may be imposed on the Company relating to the tax reporting of bitcoin and bitcoin-related transactions.

Legislation recently passed in the Senate would impose substantial tax compliance obligations on the Company relating to the reporting of bitcoin and bitcoin-related transactions. Under this legislation, it is possible that the Company would be treated as a digital assets broker and required to deliver certain tax forms in connection with the validation of blockchain transactions. Were this legislation to be passed in the House and enacted unchanged, the Company could face tax reporting and compliance mandates that it may not have the information or resources to fully comply with. Although the current legislation may not be enacted in its current form, future legislation may impose similar tax compliance responsibilities on the Company, which may be expensive and burdensome to comply with, and which could, as a result, adversely impact the Company’s operations. The Company will continue to monitor for developments in such legislation, guidance or regulations.

The Company’s bitcoin holdings could subject it to regulatory scrutiny.

As digital assets, including bitcoin, have grown in popularity and market size, there has been increasing focus on the extent to which digital assets can be used to launder the proceeds of illegal activities or fund criminal or terrorist activities or entities subject to sanctions regimes. While the Company intends to institute risk-based procedures reasonably designed to promote compliance with applicable anti-money laundering and sanctions laws and regulations and takes care to only acquire bitcoin through entities subject to anti money laundering regulation and related compliance rules in the United States, if it is found to have purchased any bitcoin from bad actors that have used bitcoin to launder money or persons subject to sanctions, the Company is and may continue to be subject to regulatory proceedings and further transactions or dealings in bitcoin may be restricted or prohibited.

Due to the unregulated nature and lack of transparency surrounding the operations of many bitcoin trading venues, they may experience fraud, security failures or operational problems, which may adversely affect the value of the Company’s future bitcoin holdings.

Bitcoin trading venues are relatively new and, in some cases, unregulated. Furthermore, there are many bitcoin trading venues which do not provide the public with significant information regarding their ownership structure, management teams, corporate practices and regulatory compliance. As a result, the marketplace may lose confidence in bitcoin trading venues, including prominent exchanges that handle a significant volume of bitcoin trading.

Negative perception, a lack of stability in the broader bitcoin markets and the closure or temporary shutdown of bitcoin trading venues due to fraud, business failure, hackers or malware or government- mandated regulation may reduce confidence in bitcoin and result in greater volatility in the prices of bitcoin.

To the extent investors view the Company’s common stock as linked to the value of the Company’s future bitcoin holdings, these potential consequences of a bitcoin trading venue’s failure could have a material adverse effect on the market value of the Company’s common stock.

Risks Related to Ownership of Our Common Stock

Our stock price has been and may continue to be volatile, and you could lose all or part of your investment.

The market price of our common stock is subject to wide fluctuations in response to various risk factors, some of which are beyond our control and may not be related to our operating performance, including:

	●	addition or loss of significant customers, suppliers, or distributors;

	●	changes in laws or regulations applicable to our industry ;

	●	additions or departures of key personnel;

	●	the failure of securities analysts to cover our common stock after an offering;

	●	actual or anticipated changes in expectations regarding our performance by investors or securities analysts;

	●	price and volume fluctuations in the overall stock market;

	●	volatility in the market price and trading volume of companies in our industry or companies that investors consider comparable;

	●	share price and volume fluctuations attributable to inconsistent trading volume levels of our shares;

	●	our ability to protect our intellectual property and other proprietary rights;

	●	sales of our common stock by us or our stockholders;

	●	the expiration of contractual lock-up agreements;

	●	litigation involving us, our industry, or both;

	●	major catastrophic events; and

	●	general economic and market conditions and trends.

Further, the stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies. These fluctuations often have been unrelated or disproportionate to the operating performance of those companies. In addition, the stock prices of many cannabis-related companies have experienced wide fluctuations that have often been unrelated to the operating performance of those companies. These broad market and industry fluctuations, as well as general economic, political, and market conditions such as recessions, interest rate changes, or international currency fluctuations, may cause the market price of our common stock to decline. If the market price of our common stock fluctuates or declines, you may not realize any return on your investment and may lose some or all of your investment.

Our operating results are subject to fluctuations and our stock price may decline significantly.

Our quarterly revenue and operating results are difficult to predict from quarter to quarter. We derive revenue from our hemp processing business which is dependent upon volumes produced by farmers and is seasonal. Prices for products derived from hemp have declined significantly over the past few years resulting in many farmers exiting the industry. We derive relatively stable revenue from our property leased industrial warehouse. Nonetheless, it is possible that our net operating results in some quarters will fall below our expectations. Our quarterly operating results will be affected by a number of factors, including:

	●	Timing, availability and changes in government incentive programs;

	●	Unplanned additional expenses and/or shortfalls in anticipated rental income at our warehouse property;

	●	Logistical costs;

	●	The timing of new technology announcements or introductions by our competitors and other developments in the competitive environment;

	●	Increases or decreases in real estate appreciation rates due to changes in economic growth;

	●	Travel costs and other factors; and

	●	State and federal government regulations

If revenue for a particular quarter is lower than we expect, we may not be unable to proportionately reduce our operating expenses for that quarter, which would harm our operating results for that quarter. If we fail to meet investor expectations or our own future guidance, even by a small amount, our stock price could decline, perhaps substantially.

There are restrictions on the transferability of certain of our securities.

Until registered for resale, investors must bear the economic risk of an investment in the Shares for an indefinite period of time. Rule 144 promulgated under the Securities Act (“Rule 144”), which provides for an exemption from the registration requirements under the Securities Act under certain conditions, requires, among other conditions, a six-month holding period prior to the resale (in limited amounts) of securities acquired in a non-public offering without having to satisfy the registration requirements under the Securities Act. There can be no assurance that we will fulfill any reporting requirements in the future under the Exchange Act or disseminate to the public any current financial or other information concerning us.

If the Company uses its stock in acquisitions of other entities, there may be substantial dilution at the time of a transaction.

The offering price of the common stock we sold as a private placement of restricted shares of our common stock to raise working capital, was arbitrarily set. The price did not bear any relationship to our assets, book value, earnings or net worth and it is not an indication of actual value. You may also suffer additional dilution in the future from the sale of additional shares of common stock or other securities or if the Company’s shares are issued to purchase other assets or to raise additional working capital.

Trading on the OTC Markets can be volatile and sporadic, which could depress the market price of our common stock and make it difficult for our stockholders to resell their shares.

Our common shares are quoted on OTCQB. There is no cost of such quotation and related services from OTC Markets, Inc. Trading in stock quoted on the OTCQB Markets is often thin and characterized by wide fluctuations in trading prices due to many factors that may have little to do with our operations or business prospects. This volatility could depress the market price of our common stock for reasons unrelated to operating performance. Moreover, the OTC Markets is not a stock exchange, and trading of securities on the OTCQB Markets is often more sporadic than the trading of securities listed on a quotation system like Nasdaq or a stock exchange like the New York Stock Exchange. Accordingly, our stockholders may have difficulty reselling any of their shares. A number of brokerage houses will not trade our securities for customers because we are in the hemp business and/or because we trade on the OTC.

The Company currently plans to move to a more advantageous trading market via a potential uplisting, to a national exchange, and a formal application has been made. However, there is no assurance that we will be able to successfully move trading markets or uplist to a national exchange.

Because we do not expect to pay any dividends for the foreseeable future, investors may be forced to sell their stock to realize a return on their investment.

We do not anticipate that we will pay any dividends to holders of our common stock for the foreseeable future. Any payment of cash dividends will be at the discretion of our board of directors and will depend on, among other things, our results of operations, cash requirements, financial condition, contractual restrictions including compliance with covenants under our debt agreements, and other factors that our board of directors may deem relevant. Our ability to pay dividends might be restricted by the terms of any indebtedness that we incur in the future. In addition, certain of our current outstanding debt agreements prohibit us from paying cash dividends on our common stock. Consequently, you should not rely on dividends to receive a return on your investment.

Our common stock is presently subject to the “Penny Stock” rules of the SEC.

We are subject now to the “Penny Stock” rules since our shares of common stock sell below $5.00 per share. Penny stocks generally are equity securities with a price of less than $5.00. The penny stock rules require broker-dealers to deliver a standardized risk disclosure document prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer must also provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson, and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information must be given to the customer orally or in writing prior to completing the transaction and must be given to the customer in writing before or with the customer’s confirmation. ∙ In addition, the penny stock rules require that prior to a transaction, the broker dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. The penny stock rules are burdensome and may reduce the trading activity for shares of our common stock. As long as our shares of common stock are subject to the penny stock rules, the holders of such shares of common stock may find it more difficult to sell their securities.

If we fail to remain current on our reporting requirements, we could be removed from the OTCQB which would limit the ability of broker-dealers to sell our securities in the secondary market.

Companies trading on the OTCQB must be reporting issuers under Section 12 of the Securities Exchange Act of 1934, as amended, and must be current in their reports under Section 13, in order to maintain price quotation privileges on the OTCQB. As a result, the market liquidity for our securities could be severely adversely affected by limiting the ability of broker-dealers to sell our securities and the ability of stockholders to sell their securities in the secondary market. In addition, we may be unable to get relisted on the OTCQB, which may have an adverse material effect on the Company.

If we decide to implement a reverse stock split, a reverse stock split may decrease the liquidity of the shares of our common stock.

The liquidity of the shares of our common stock may be affected adversely by a reverse stock split given the reduced number of shares that will be outstanding following a reverse stock split, especially if the market price of our common stock does not increase as a result of the reverse stock split.

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

We provide post-harvest and midstream services to growers by drying, processing, cleaning, stripping harvested hemp directly from the field and wetbaled at our leased 48,000 square foot facility located in Hopkinsville, Kentucky. We maintain significant equipment at this location including four belt dryers, augers and elevators, polishers, debearders, screening machines, dust collection systems, hammer mill, air compressors and bagging equipment.

Our industrial warehouse is located at 4430 Garfield Street, Denver, Colorado in an industrial neighborhood zoned for cannabis cultivation. Properties located in the 80216 zip code have recently had some of the highest appreciation rates in the Denver region due to significant infrastructure expenditures by local governmental agencies. Numerous warehouses utilized for cannabis cultivation are located in this industrial district of Denver.

We also lease office space located in Fort Worth, Texas for managerial offices.

The Company owns certain real property including land, hydroelectric dam, generators, transformers, internet towers, etc. in Costa Rica through an 80% owned subsidiary.

Item 3. Legal Proceedings

As a normal incident of the businesses in which the Company is engaged, various claims, charges and litigation may be asserted or commenced from time to time against the Company. With respect to claims and litigation currently asserted or commenced against the Company, it is the opinion of management that final judgments, if any, which might be rendered against the Company are adequately reserved for, are covered by insurance, or are not likely to have a material adverse effect on the Company’s financial condition or results of operations. Nevertheless, given the uncertainties of litigation, it is possible that certain types of claims, charges and litigation could have a material adverse impact on the Company; see Item 1A, “Risk Factors.” See Note 8 to the consolidated financial statements included in this annual report for additional information relating to legal matters.

Item 4. Mine Safety Disclosures

Not applicable.

PART II

Our common stock is quoted on OTCQB under the symbol “GENH.” In the future, should we meet stringent qualifications and pay the required fee, we plan to have our shares quoted on Capital Markets tier of NASDAQ, however here is no assurance that our shares will continue to be quoted on any market.

Shareholders

As of the date of this report, there were 76 direct holders of our common shares as shown on the list maintained by our transfer agent. We may have a substantial number of additional shareholders who hold their shares in street name.

Dividends

We have not declared or paid any cash dividends on our common stock. To date we have utilized all available cash to finance our operations. Payment of cash dividends in the future will be at the discretion of our Board of Directors and will depend upon our earnings levels, capital requirements, any restrictive loan covenants and other factors the Board considers relevant.

Warrants

At December 31, 2022, there were 3,058,333 warrants outstanding for the purchase of Company common stock. Refer to Note 10 to the consolidated financial statements included in this annual report for additional information relating to outstanding warrants.

Equity Compensation Plans

At December 31, 2022, there were 15,765,000 options outstanding for the purchase of Company common stock. Refer to Note 11 to the consolidated financial statements included in this annual report for additional information relating to outstanding options.

Recent Sales of Unregistered Securities

Since January 1, 2022, we have sold securities in private transactions without registering the securities under the Securities Act as shown below:

●

Issuance for Extensions of Secured Note – The Company issued 110,000 common shares as consideration for extensions of the maturity of a senior note in 2022.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

We made no purchases of our equity securities.

Our Transfer Agent

We have retained Securities Transfer Corporation (“STC”), Plano, Texas, as transfer agent for our Common shares. Shareholders are responsible to contact STC to update their address. This may be done by contacting:

	Securities Transfer Corporation
	2901 N. Dallas Parkway, Suite 380
	Plano, Texas 75093
	Phone:	(469) 633-0101
	Fax:	(469) 633-0088
	www.stctransfer.com

STC is responsible for all record-keeping and administrative functions in connection with our common shares.

Item 6. Reserved

Not applicable.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion is intended to assist you in understanding our results of operations and our present financial condition and contains forward-looking statements that reflect our future plans, estimates, beliefs and expected performance. The forward-looking statements are dependent upon events, risks and uncertainties that may be outside our control. We caution you that our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences are discussed elsewhere in this Annual Report, particularly in the “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors,” all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. We do not undertake any obligation to publicly update any forward-looking statements except as otherwise required by applicable law.

There is limited historical financial information about our Company upon which to base an evaluation of our future performance. We cannot guarantee that we will be successful in our hemp businesses. We are subject to risks inherent in a small company, including limited capital resources, delays and cost overruns due to price and cost increases. There is no assurance that future financing will be available to our company on acceptable terms. Additional equity financing could result in dilution to existing shareholders.

Overview

We are a holding company active within the “hemp” space. Beginning in 2023, we started activities in the sustainable asset space including the bitcoin industry. We were incorporated on August 21, 2021 in the State of Delaware. The Company was originally incorporated on July 28, 2008 in the State of Colorado. On November 27, 2019, HTF purchased approximately 94% of the common stock of EHR in a series of transactions accounted for as a reverse merger.

On January 11, 2021, we completed the acquisition of certain assets of Halcyon Thruput, LLC (“Halcyon”). With this acquisition, we commenced providing post-harvest and midstream services to growers by drying, processing, cleaning and stripping harvested hemp directly from the field and wetbaled at our 48,000 square foot leased facility located in Hopkinsville, Kentucky. Additionally, the Company offers safe storage services for processed hemp, which enables farmers to maximize strategic market timing. In ~~August~~September 2021, the Company launched its small animal bedding consumer goods product line (“Rowdy Rooster”) made from the hemp hurd byproduct that is produced from its hemp processing operations. In September of 2022, the Company launched its industrial absorbent consumer goods product line (Gas Monkey Spill-Jack), also made from the hemp hurd byproduct produced from its hemp processing operations. This second product line is marketed under a branding agreement with Gas Monkey Garage, a well-known brand in the automotive and entertainment sector.

We also generate revenue from rental of our “Cannabis Zoned” (Hemp) warehouse property located in Denver, Colorado currently leased to an unaffiliated hemp seed company.

Liquidity – The Company is dependent upon obtaining additional funding to continue ongoing operations and to pursue its strategy and execute its acquisition plans.

In ~~2021~~the year ended December 31, 2022, the Company used $~~3.5~~633 ~~million~~thousand of cash for its operating activities. At December 31, ~~2021~~2022, the Company’s current liabilities, including financing obligations due within one year, totaled $45.49 million as compared with its current assets of $~~238~~917 thousand.

The Company will continue to pursue additional capital raising opportunities in order to fund future acquisitions and meet its obligations as they become due. In the event financing cannot be obtained, the Company may not be able to satisfy these plans and obligations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Impact of COVID-19 Pandemic on Our Business – Our business, results of operations and financial condition have been adversely affected by the COVID-19 pandemic, beginning in mid-March 2020. The COVID-19 pandemic and measures taken to contain it have subjected our business, results of operations, financial condition, stock price and liquidity to a number of material risks and uncertainties, all of which may continue or may worsen.28

Subsequent Events

In January 2023, the Company announced a new strategic direction into sustainable energy projects, starting with bitcoin mining. The Company’s name was changed to Evergreen Sustainable Enterprises, Inc. (“EGSE”) in March 2023. The Company’s existing hemp operations will continue to be maintained as a fully operating wholly-owned subsidiary.

On January 9, 2023, the Company purchased 80% of Toro Energía Sociedad Anonima (“Toro”), a Costa Rican corporation with ownership of a hydroelectric dam located in Costa Rica. The source of approximately one megawatt of power produced from the hydroelectric dam (six generators) will be used to power new Bitcoin mining machines at an extremely low cost. The transaction was completed based on a total enterprise value for Toro of $2.75 million, including seller-financed debt of $985 thousand. The seller-financed debt has a term of 10 years and a 9.5% per annum variable interest rate (based on the prime rate) with straight line amortization.

The purchase price for 80% of Toro’s equity was $1,412,000. These amounts were paid in cash from proceeds of a Secured Promissory Note (“Secured Note”) with Gary C. Evans, CEO of the Company (‘Evans”). Under the terms of the Secured Note, (a) the Company and Evans restructured (i) the Subordinated Promissory Note, dated November 20, 2020 and (ii) Convertible Promissory Note, dated July 20, 2021, such that all accrued and unpaid interest on each note were rolled into a new Secured Note, (b) Evans lent the Company $500 thousand on January 9, 2023 and $969 thousand on January 10, 2023. The Secured Note has a maturity date of July 15, 2023 and bears interest at the rate of 10.00% per annum. The Secured Note has a conversion feature which permits Evans to convert at the Maturity Date then outstanding principal and interest at a conversion price of $0.275 (the closing price of the Company’s stock on January 9, 2023).

The Toro Dam is located approximately 25 miles from San Jose between two volcano craters. The site generates all its energy from green resources with a proven 98% run time over the many years it has been in operation and has a full-time staff in place under a new Operating & Maintenance Agreement.

Hydroelectric power is a clean and renewable energy source that is used to generate electricity by harnessing the energy of falling water and can provide a reliable and a very cost-effective source of energy for bitcoin mining operations. Hydroelectric power can help reduce the carbon footprint of cryptocurrency mining, as many cryptocurrencies are produced using fossil fuels, which continues to contribute to greenhouse gas emissions and climate change. By using hydroelectric power, bitcoin mining can be made more environmentally friendly and sustainable and can help improve the stability and reliability of cryptocurrency networks. Hydroelectric power is a relatively stable and reliable source of energy, compared to other sources such as coal or fossil fuels, which can be prone to price fluctuations and supply disruptions. The Company has committed to acquire and made financial payments for the purchase of 240 new Bitmain S19J Pro+ ASIC miners that will be deployed at the Toro Dam sometime in the first quarter of 2023.

How the Company Generates Revenue

We provide post-harvest and midstream services to growers by drying, processing, cleaning and stripping harvested hemp directly from the field and wetbaled at our leased 48,000 square foot facility located in Hopkinsville, Kentucky. Additionally, the Company offers safe storage services for processed hemp, which enables farmers to maximize strategic market timing. In August 2021, the Company launched its animal bedding consumer goods product line made from the hemp hurd byproduct that is produced from its hemp processing operations.

We also generate revenue from rental of our “Cannabis Zoned” (Hemp) warehouse property located in Denver, Colorado currently leased to a hemp seed company.

We currently intend to generate revenue from Bitcoin mining.

Our Costs and Expenses of Conducting Business

The principal costs and expenses involved in conducting our business are labor, materials and overhead costs for processing services, real estate holding costs (interest, taxes, depreciation and maintenance costs) and general and administrative expenses for our management, contract labor, professional fees and other costs of being a public company. We also incur costs in seeking acquisitions and financings of our business.

Discontinued Oil & Gas Activities

As of December 31, ~~2021~~2022, EHR held an approximate 8% working interest in an oil & gas property located in Cochran County, Texas within the Slaughter-Levelland Field of the San Andres formation in the Northwest Shelf of West Texas. EHR’s oil & gas activities are currently held for sale and are presented in these consolidated financial statements as discontinued operations for each of the periods presented.

Results of Operations

Years Ended December 31, ~~2021~~2022 and ~~2020~~2021

The net loss attributable to Evergreen Sustainable Enterprises for the year ended December 31, ~~2021~~ 2022 was $97.80 million as compared with a net loss attributable to Evergreen Sustainable Enterprises of $19.68 million for ~~2020~~2021. The ~~larger~~net loss inattributable ~~2021~~to ~~was~~Evergreen ~~principally~~Sustainable ~~due~~Enterprises tofor ~~higher~~2022 ~~costs~~includes $4.8 million of stock-based ~~for~~compensation ~~staffing~~expense, ~~additions~~$407 ~~and~~thousand ~~other~~for ~~business~~a ~~operating~~non-cash ~~costs~~impairment ascharge weand ~~commenced~~$1.0 ~~post-harvest~~million ~~midstream~~for ~~services~~depreciation ~~after~~and ~~the~~amortization ~~acquisition~~largely ofdue ~~certain~~to ~~assets~~the of Halcyon acquisition. ~~The~~Excluding ~~2021~~these ~~loss~~non-cash ~~also~~items, ~~include~~the ~~non-~~Company’s cash ~~expense~~loss ~~totaling~~was $5852 thousand in 2022 as compared with a cash loss of $3.9 million for ~~stock-based~~2021. ~~compensation~~We ~~and~~processed ~~depreciation~~larger ~~and~~volumes of hemp in 2022 as compared with 2021 resulting in greater gross profits from ~~amortization~~these operations. We also received $501 thousand for settlements from two lawsuits during 2022.

The Company reports its oil & gas activities as discontinued operations. Loss from discontinued operations was $3260 thousand for the year ended December 31, ~~2021~~2022 as compared with a a loss of $3432 thousand in ~~2020~~2021.

Revenue. WeTotal ~~commenced~~revenue ~~post-harvest and midstream services~~ for ~~new~~2022 ~~and~~was renewed customer contracts in the third quarter of 2021. These revenues are typically limited due during the first half of each year until harvest. In 2020 (prior to our acquisition), Halcyon had revenues of $32.~~0 million for the processing~~6 ~~of approximately 8.5~~ million ~~pounds~~as ofcompared ~~hemp~~with ~~biomass. In 2021, we had revenues of~~ $~~592~~674 thousand for ~~the processing of approximately 2~~2021.1 million pounds of hemp biomass. The decrease is partially due to taking inventory in-kind and holding such inventory for a sale at a later date. We have executed contracts for processing of 6.7 million pounds during the 2022.

~~Rental~~Our ~~revenue~~hemp ~~was~~processing ~~$82~~operations ~~thousand~~are intypically ~~2021~~limited during asthe ~~compared with~~first ~~$90~~half ~~thousand~~of ineach ~~2020~~year until harvest. ~~The~~In ~~Company’s~~2022, ~~Denver~~we ~~warehouse~~commenced ishemp ~~presently~~processing ~~leased~~in June and remained fully operational through late-December ~~August~~2022. We processed 6.1, ~~2023~~million pounds of hemp biomass for total revenues of $72.5 ~~thousand~~million. ~~per~~In ~~month~~2021, we commenced hemp processing ~~plus~~operations ~~certain~~in ~~other~~the ~~expenses~~third quarter. We had revenues of $592 thousand for the processing of approximately 2.1 million pounds of hemp biomass.

~~Cost~~In of2022, ~~Revenue.~~we ~~Cost~~sold ofabout ~~revenue~~30% ~~for~~of ~~2021 was~~our ~~$653~~on-hand ~~thousand and consisted~~ inventory of ~~direct~~processed ~~labor,~~hemp ~~supplies~~biomass ~~and overhead~~ for ~~the~~$100 ~~Company’s post-harvest and midstream services operations~~thousand. ~~The~~ ~~negative~~We ~~margin~~took on this ~~business~~inventory ~~was~~in-kind ~~caused~~from bya ~~holding~~customer ~~costs~~in ~~and~~late-2021. ~~limited~~We ~~staffing~~are ~~needed~~holding ~~until~~ the ~~annual harvest and processing~~remaining ~~began~~inventory infor ~~the~~sale ~~third~~at ~~quarter~~a oflater ~~2021~~date.

~~Depreciation~~Rental ~~and~~revenue ~~Amortization.~~was ~~Depreciation and amortization expense totaled~~ $~~1.3~~90 ~~million~~thousand in ~~2021~~2022 as compared with $7182 thousand ~~for~~in ~~2020~~2021. The ~~increase~~Company’s inDenver ~~the~~warehouse ~~2021 period~~ is ~~due to~~presently ~~completion~~leased ofthrough ~~the~~August Halcyon acquisition including $818 thousand for amortization of acquired intangible assets. Intangible assets consist of customer relationships and non-compete agreements acquired in the acquisition of certain assets of Halcyon. Future amortization expense in each of the next five years amounts to $587 thousand for 20221, ~~$419 thousand for~~ 2023, ~~$278 thousand~~ for ~~2024,~~ $~~194~~7.5 thousand ~~for~~per ~~2025,~~month ~~$130~~plus ~~thousand~~certain ~~for~~other ~~2026 and $250 thousand thereafter~~expenses.

~~Merger~~Cost ~~and~~of ~~Acquisition Costs~~Revenue. WeCost ~~incurred~~ of revenue was $161.0 million ~~thousand~~for ~~and~~2022 as compared with $~~100~~653 thousand for 2021 and consisted of ~~costs~~direct ~~for~~labor, ~~evaluating~~supplies ~~acquisition~~and ~~opportunities~~overhead ~~during~~for ~~2021~~the Company’s post-harvest and ~~2020,~~midstream ~~respectively~~services operations. ~~These~~Our ~~costs~~gross ~~principally~~margin on post-harvest processing and midstream services was 59% in 2022 as ~~related~~compared towith ~~the~~-10% ~~Halcyon~~for ~~acquisition~~2021. The ~~amount~~negative ofmargin ~~future~~on ~~expenses~~this ofbusiness ~~this~~in ~~type~~2021 ~~that~~was caused by holding costs and limited staffing needed until the annual harvest and processing commenced in August 2021. In 2022, we ~~incur~~took ~~will~~steps ~~depend~~to ~~upon~~reduce ~~our~~operating ~~future~~costs ~~acquisition~~by idling our facilities ~~activities~~until processing commenced in June 2022.

19Depreciation and Amortization. Depreciation and amortization expense totaled $1.0 million in 2022 as compared with $1.3 million for 2021. Intangible assets consist of customer relationships and non-compete agreements acquired in the acquisition of certain assets of Halcyon. Amortization of these intangibles was $586 thousand in 2022 and $818 thousand in 2021. Future amortization expense in each of the next five years are expected to be $419 thousand for 2023, $278 thousand for 2024, $194 thousand for 2025, $130 thousand for 2026 and $86 thousand for 2027.

General and Administrative Expense. General and administrative expenses totaled $7.81 million for the year ended December 31, ~~2021~~2022 as compared with $17.18 million in ~~2020~~2021. The ~~increase~~reduction inwas ~~general~~principally ~~and~~a ~~administrative~~result ~~expense~~of inlower ~~the~~cash ~~2021~~compensation ~~period~~expense isin ~~principally~~2022. ~~due~~In ~~the Halcyon acquisition~~2021, ~~other corporate staffing additions made this year, and the payment of~~ bonus compensation ~~as well as stock-based compensation expense. Bonus compensation~~ totaling $610 thousand was paid to our CEO for successful completion of the Halcyon acquisition. InNon-cash ~~the~~stock-based ~~third~~compensation ~~quarter~~expense ofwas ~~2021, the Company paid~~ $~~189~~4.8 ~~thousand for~~million ~~legal fees and $33 thousand of interest~~ in ~~settlement~~2022 ofas ~~an arbitration. General and administrative expense for 2021 also includes~~compared with $4.5 million ofin ~~non-cash stock-based compensation expense~~2021.

Other Income/Expense. ~~Total~~Interest ~~other~~ expense was $~~671~~501 thousand ~~for~~in ~~2021~~2022 asand ~~compared with~~ $~~296~~708 thousand ~~for~~in ~~2020~~2021. ~~The~~Amortization ~~largest item~~ of ~~total~~debt ~~other~~discounts ~~expense~~was is$327 ~~interest~~thousand ~~expense~~higher ~~which has~~in ~~increased~~2021 ~~due~~than toin ~~having higher levels of indebtedness~~2022. ~~Interest~~These debt ~~expense~~discounts ~~for~~were ~~2021~~incurred ~~includes~~from ~~$380~~the ~~thousand~~initial ofissuance ~~amortization~~ of debt ~~discounts and~~with ~~$33~~stock ~~thousand~~or ~~of interest for the arbitration settlement discussed above~~warrants.

InOther ~~2021,~~income wefor ~~sold~~2022 ~~our~~includes ~~investment~~$501 inthousand ~~the marketable~~received ~~common stock we held~~ for ~~total~~settlements ~~proceeds~~from oftwo ~~$35~~lawsuits ~~thousand~~during 2022. In We2021, ~~recognized~~other aincome ~~loss~~ of $1225 thousand ~~on this disposal. This publicly traded security~~ was ~~marked to market each fiscal quarter until its eventual sale. In 2020, we~~ recognized afor ~~gain~~forgiveness of ~~$10 thousand for~~ the ~~increase~~Company’s inPPP ~~this~~Loan ~~security’s~~principal ~~value~~and interest thereon.

WeLoss ~~received~~from ~~notice~~Discontinued ~~that~~Operations. ~~the~~In ~~Company’s~~2022, we ~~PPP~~recognized ~~Loan~~a ~~principal~~loss ~~and~~from ~~interest~~discontinued ~~thereon~~operations ~~was~~of ~~fully~~$60 ~~forgiven~~thousand as compared with a loss of $32 thousand in 2021. The major classes of line items constituting the loss on ~~April~~discontinued 20operations is presented in Item 8 of Part II, ~~2021~~“Financial Statements and Supplementary Data—Note 12—Discontinued Operations.” AsUntil ~~such~~we fully dispose of our remaining oil & gas property interests, we ~~recognized~~expect lower future revenues and costs as production activities have declined substantially. We do not anticipate ~~forgiveness~~making ~~income~~future investment of ~~$25~~growth capital into these properties. In 2019,~~424~~ inthe ~~2021~~Company’s oil and gas properties became impaired and the carrying amount of the properties was expensed due to the market decline and the Company’s determination to exit the oil and gas business.

Loss from Discontinued Operations. In 2021, we recognized a loss from discontinued operations of $32 thousand as compared with a loss of $34 thousand in 2020. The major classes of line items constituting the loss on discontinued operations is presented in Item 8 of Part II, “Financial Statements and Supplementary Data—Note 11—Discontinued Operations.” Until we fully dispose of our remaining oil & gas property interests, we expect lower future revenues and costs as production activities have declined substantially. We do not anticipate making future investment of growth capital into these properties.30

In 2019, the Company’s oil and gas properties became impaired and the carrying amount of the properties was expensed to the market decline and the Company’s determination to exit the oil and gas business.

Liquidity and Capital Resources

Our primary source of cash from continuing operations includes post-harvest and midstream services and rental revenue. Our primary uses of cash include our operating costs, general and administrative expenses and merger and acquisition expenses.

Cash flow information from continuing operations for ~~the~~2022 ~~first nine months of 2021~~ was as follows:

● Cash used in operating activities was $~~3.5~~633 thousand million principally due to the net loss adjusted for non-cash items.

● ~~Net~~No cash was used infor investing activities ~~totaled $1.6 million including an expenditure of $1.5 million for the cash portion of the total consideration for the Halcyon acquisition and proceeds from the sale of our investment~~ in ~~common stock of $35 thousand~~2022. ~~We made capital expenditures totaling $78 thousand for new processing equipment to expand our business lines to include post-processing of biomass.~~

● Net cash from financing activities totaled $~~2.3~~887 ~~million~~thousand. This amount included $41.3 million of cash inflows from the ~~issuance of common stock units and~~ proceeds from ~~warrant~~notes ~~exercises~~payable. ~~As well, we received $410 thousand in advances from our CEO under promissory notes.~~ We used $~~2.2~~407 ~~million~~thousand of cash for repayment of outstanding indebtedness ~~and $154 thousand for payment of scheduled redemptions and dividends on the Series B preferred stock~~.

We ~~had~~used no$3 ~~cash~~thousand ~~flows~~of ~~from~~cash for discontinued operations in ~~2021~~2022.

Funding Requirements

We expect to continue to incur significant expenses and operating losses for the foreseeable future. We anticipate that our overall expenses may increase significantly as we grow our hemp business.

We anticipate that we will require additional capital to fund operations, including hiring additional employees, completing acquisitions and funding capital expenditures during the next twelve-month period.

Because of the numerous risks and uncertainties associated with the development and commercialization of our business, we are unable to estimate the amounts of increased capital outlays and operating expenses. Our future capital requirements will depend on many factors, including:

●

our success in identifying and making acquisitions of profitable operations;

●

our ability to negotiate operating contracts with growers and others within the hemp industry on favorable terms, if at all;

●

deriving revenue from our assets and operations; and

●

the cost of such operations and costs of being a public company.

Until such time as we can generate substantial revenues, we expect to finance our cash needs through a combination of equity offerings and debt financings. We do not have any committed external source of funds. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our shareholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of common shareholders. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate our growth plans and future commercialization efforts.

Off-Balance Sheet Arrangements

As of December 31, ~~2021~~2022, we had no off-balance sheet arrangements.

Indebtedness

The Company’s indebtedness at December 31, 2022 ~~2021~~ is presented in Item I, “Financial Statements – Note 5 – Notes Payable – Related Parties” ~~and~~ and in Item I, “Financial Statements—Note 6—Other Indebtedness.”

~~In the first quarter of 2022~~ Subsequently, ~~Investment Hunter,~~the ~~LLC,~~Company areceived ~~Texas LLC controlled by our CEO, made~~ advances ~~totaling $449,000 to the Company~~ under anew ~~promissory~~and existing note ~~due June 30, 2022~~arrangements. ~~If the~~Refer ~~Company~~to ~~raises~~Item ~~new equity capital of $3 million or more~~I, ~~then~~“Financial ~~the~~Statements—Note 15 ~~full amount outstanding under the note is due within five days.~~– ~~The~~Subsequent ~~note bears interest at 10% per annum~~Events.”

Critical Accounting Policies and Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP 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 consolidated financial statements and the amounts of revenue and expenses reported for the period then ended.

Impairment of Long-lived Assets. We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. These events and circumstances include, but are not limited to, a current expectation that a long-lived asset will be disposed of significantly before the end of its previously estimated useful life, a significant adverse change in the extent or manner in which we use a long-lived asset or a change in its physical condition.

When such events or changes in circumstances occur, a recoverability test is performed comparing projected undiscounted cash flows from the use and eventual disposition of an asset or asset group to its carrying amount. If the projected undiscounted cash flows are less than the carrying amount, an impairment is recorded for the excess of the carrying amount over the estimated fair value.

We make various assumptions, including assumptions regarding future cash flows in our assessments of long-lived assets for impairment. The assumptions about future cash flows and growth rates are based on the current and long-term business plans related to the long-lived assets.

Stock-based Compensation – We account for employee stock-based compensation using the fair value method. Compensation cost for equity incentive awards is based on the fair value of the equity instrument generally on the date of grant and is recognized over the requisite service period. Forfeitures are recognized as they occur.

Recent Accounting Pronouncements. See Item 8 of Part II, “Financial Statements and Supplementary Data—Note 2—Summary of Significant Accounting Policies—Recent Accounting Pronouncements.”

Item 7A. Quantitative and Qualitative Disclosure About Market Risk

Not required for smaller reporting companies.

2232

Item 8. Financial Statements and Supplementary Data

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Page
Report of Independent Registered Public Accounting Firm (PCAOB ID Number 688)	F-2
Consolidated Balance Sheets	F-4
Consolidated Statements of Operations	F-5
Consolidated Statements of Changes in Stockholders’ Equity (Deficit)	F-6
Consolidated Statements of Cash Flows	F-7
Notes to Consolidated Financial Statements	F-8

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

Evergreen Sustainable Enterprises, Inc. (formerly Generation Hemp, Inc.)

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Evergreen Sustainable Enterprises, Inc. (formerly Generation Hemp, Inc.) (the “Company”) as of December 31, ~~2021~~2022 and ~~2020~~2021, the related consolidated statements of operations, changes in stockholders’ equity (deficit) and cash flows for each of the years ended December 31, ~~2021~~2022 and ~~2020~~2021, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, ~~2021~~2022 and ~~2020~~2021, and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Explanatory Paragraph – Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 1, the Company has a significant working capital deficiency, has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1 to the consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

F-2

Valuation and accounting for share-based instruments

As described in Note 9, for the year ended December 31, 2021, the ~~Company~~ Company issued 2,558,333 warrants to investors with exercise prices of $0.500 to $0.600 per share, vesting over a period of two years. The warrants issued were attached to units of common stock sold to various investors including a related party, which are only redeemable by the warrants holders. Total outstanding warrants as of December 31, 2021 were 8,808,333. As described in Note 10, the Company issued 13,850,000 options during the year ended December 31, 2021 with a grant date fair value of $10,525,284. Share-based compensation expense of $4,385,118 was recognized in 2021 related to these options based on the vesting terms.

As described in Note 10, the Company issued 13,850,000 options during the year ended December 31, 2021 with a grant date fair value of $10,525,284. Additionally, the Company issued 1,915,000 options during the year ended December 31, 2022 with a grant date fair value of $576,251. Share-based compensation expense of $4,385,118 and $4,758,257 was recognized in 2021 and 2022, respectively, related to these options based on the vesting terms.

How we Addressed the Matter in Our Audit

Our audit procedures included, amongst others:

	●	We tested the agreements to determine whether management appropriately evaluated such agreements on issuance date.

	●	We tested the information that served as the basis for valuation of the shares issued to determine whether stock compensation should be recorded.

	●	We evaluated the reasonableness of the valuation method and assumptions used by management to calculate the values on issuance date by developing an independent estimate of the volatility by utilizing third party historical data of closing prices.

Valuation and accounting for acquisition of Halcyon assets

As described in Note 3, for the year ended December 31, 2021, the Company completed the acquisition of certain assets of Halcyon for a total purchase consideration of $6,100,000 consisting of 6,250,000 shares of Company common stock valued at $2.5 million, $1.75 million in cash, a promissory note for $850,000 and the assumption of approximately $1,000,000 of new indebtedness of Halcyon.

How we Addressed the Matter in Our Audit

Our audit procedures included, amongst others:

●

We tested the asset purchase agreements to determine whether appropriately evaluated such agreements on the acquisition date.

●

We tested the information that served as the basis for valuation for the asset acquired whether any valuation adjustments should be recorded.

●

We evaluated the reasonableness of the valuation method and assumptions used by management to calculate the values on the acquisition date by developing an independent estimate of the fair values by utilizing the multi-period excess earnings method for intangible assets and published cost databases for tangible assets.

/s/ Marcum llp

Marcum llp

We have served as the Company’s auditor since 2019.

Houston, Texas ~~April~~May 1218, ~~2022~~2023

F-3

~~Generation~~Evergreen ~~Hemp~~Sustainable Enterprises, Inc.

(formerly Generation Hemp, Inc.)

Consolidated Balance Sheets

	December 31,
	2021			2020
	2022			2021
Assets
Current Assets
Current Assets:
Cash	$	20275,~~656~~506		$	220,~~776,425~~656
Inventories		212,518			-
Accounts receivable		470,719			-
Prepaid expenses		4,723			-
Inventories		148,427			212,518
Total Current Assets		237,897			2,776,425
Prepaid expenses		22,143			4,723
Property and Equipment
Total current assets		916,795			237,897
Property and equipment		3,206,107			1,222,430
Property and equipment, net		2,161,952			2,580,662
Accumulated depreciation		(625,445	)		(102,938	)
Operating lease right-of-use asset		161,827			263,065
Total Property and Equipment, Net		2,580,662			1,119,492
Intangible assets, net		1,271,398			1,857,908
Operating lease right-of-use asset		263,065			-
Goodwill		799,888			799,888
Intangible assets, net		1,857,908			-
Other assets		2,060			407,000
Goodwill		799,888			-
Total Assets	$	5,313,920		$	6,146,420
Other assets		407,000			23,077
Total Assets	$	6,146,420		$	3,918,994
Liabilities and Equity (Deficit)
Current Liabilities
Current Liabilities:
Accounts payable	$	~~883~~686,~~485~~297		$	1883,~~053,542~~485
Accrued liabilities		~~410~~767,~~990~~396			~~337~~410,~~588~~990
Payables to related parties		~~204~~591,~~007~~574			~~448~~204,~~271~~007
Operating lease liability - related party		~~101~~111,~~238~~839			-101,238
Notes payable – related parties		23,~~183~~322,~~551~~620			32,~~336~~183,~~592~~551
Other indebtedness - current		~~501~~250,~~668~~002			~~619~~501,~~461~~668
Common stock issuable		-			50,000
Current liabilities of discontinued operations held for sale		166,186			153,482
Current liabilities of discontinued operations held for sale		153,482			140,068
Total current liabilities		5,895,914			4,438,421
Total Current Liabilities		4,438,421			5,985,522
Operating lease liability - related party, net of current portion		49,988			161,827
Operating lease liability - related party, net of current portion		161,827			-
Long-term liabilities of discontinued operations held for sale		207,197			162,948
Other indebtedness - long-term		-			25,200
Total liabilities		6,153,099			4,763,196
Long-term liabilities of discontinued operations held for sale		162,948			144,149
Commitments and contingencies
Total Liabilities		4,763,196			6,154,871
Series B redeemable preferred stock, no par value, $10,000 stated value, 300 shares authorized, 118 shares issued and outstanding at December 31, 2022 and 2021		591,558			591,558
Commitments and Contingencies
Equity (Deficit):
Series B redeemable preferred stock, no par value, $10,000 stated value, 300 shares authorized, 118 and 135 shares issued and outstanding at December 31, 2021 and 2020		591,558			729,058
Preferred stock, $0.00001 par value; 200,000,000 shares authorized, none outstanding		-			-
Equity (Deficit)
Common stock, $0.00001 par value; 200,000,000 shares authorized, 113,204,002 and 113,094,002 shares issued and outstanding at December 31, 2022 and 2021, respectively		1,132			1,131
Series A preferred stock, $0.00001 par value; $1.00 stated value; 6,500,000 shares authorized, none and 6,328,948 shares issued and outstanding at December 31, 2021 and 2020		-			4,975,503
Additional paid-in capital		34,029,851			29,150,258
Common stock, $0.00001 par value; 200,000,000 shares authorized, 113,094,002 shares issued and outstanding at December 31, 2021		1,131			-
Accumulated deficit		(35,230,018	)		(28,118,245	)
Common stock, no par value; 100,000,000 shares authorized, 17,380,317 shares issued and outstanding at December 31, 2020		-			6,083,480
Evergreen Sustainable Enterprises equity (deficit)		(1,199,035	)		1,033,144
Additional paid-in capital		29,150,258			4,436,018
Noncontrolling interest		(231,702	)		(241,478	)
Accumulated deficit		(28,118,245	)		(18,220,705	)
Total equity (deficit)		(1,430,737	)		791,666
Generation Hemp equity		1,033,144			(2,725,704	)
Total Liabilities and Equity (Deficit)	$	5,313,920		$	6,146,420
Noncontrolling interest		(241,478	)		(239,231	)
Total Equity (Deficit)		791,666			(2,964,935	)
Total Liabilities and Equity (Deficit)	$	6,146,420		$	3,918,994

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

F-4

~~Generation~~Evergreen ~~Hemp~~Sustainable Enterprises, Inc.

(formerly Generation Hemp, Inc.)

Consolidated Statements of Operations

	For the year ended December 31,
	2021			2020
	2022			2021
Revenue
Revenue:
Post-harvest and midstream services	$	~~592~~2,~~024~~505,590		$	-592,024
Rental		8290,~~500~~000			9082,~~000~~500
Total revenue		~~674~~2,~~524~~595,590			90674,~~000~~524
Costs and Expenses
Costs and Expenses:
Cost of revenue (exclusive of items shown separately below)		~~652~~1,~~521~~016,930			-652,521
Depreciation and amortization		1,~~340~~005,~~425~~220			711,~~000~~340,425
Merger and acquisition costs		16,115			99,880
Impairment expense		407,000			-
General and administrative		7,~~787~~128,~~081~~421			17,~~141~~803,~~957~~196
Total costs and expenses		9,~~796~~557,~~142~~571			19,~~312~~796,~~837~~142
Operating loss		(96,~~121~~961,~~618~~981	)		(19,~~222~~121,~~837~~618	)
Other expense (income)
Other expense (income):
Interest and other income		(25,424	)		(1	)
Other income		(500,905	)		(25,424	)
Change in fair value of marketable security		~~(11,770~~-	)		9(11,~~882~~770	)
Interest expense		~~708~~501,~~338~~146			~~286~~708,~~372~~338
Total other expense		671,144			296,253
Total other expense (income)		241			671,144
Loss from continuing operations		(96,~~792~~962,~~762~~222	)		(19,~~519~~792,~~090~~762	)
Loss from discontinued operations		(32,213	)		(34,259	)
Income (loss) from discontinued operations		(59,773	)		(32,213	)
Net loss	$	(97,~~824~~021,~~975~~995	)	$	(19,~~553~~824,~~349~~975	)
Less: net loss attributable to noncontrolling interests		(2,247	)		(54,680	)
Less: net income (loss) attributable to noncontrolling interests		9,776			(2,247	)
Net loss attributable to Generation Hemp	$	(9,822,728	)	$	(1,498,669	)
Net loss attributable to Evergreen Sustainable Enterprises	$	(7,031,771	)	$	(9,822,728	)
Earnings (loss) per common share:
Loss from continuing operations
Basic	$	(0.1706	)	$	(0.0817	)
Diluted	$	(0.1706	)	$	(0.0817	)
Loss from discontinued operations
Basic	$	-		$	-
Diluted	$	-		$	-
Earnings (loss) per share
Basic	$	(0.1706	)	$	(0.0917	)
Diluted	$	(0.1706	)	$	(0.0917	)

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

F-5

~~Generation~~Evergreen ~~Hemp~~Sustainable Enterprises, Inc.

(formerly Generation Hemp, Inc.)

Statements of Changes in Stockholders’ Equity (Deficit)

	Series B Redeemable Preferred Stock						Series A Preferred Stock						Common Stock					Additional Paid-In			Accumulated			Noncontrolling			Total Equity
	Shares			Amount			Shares			Amount			Shares		Amount			Capital			Deficit			Interest			(Deficit)
Balance at January 1, 2020		-		$	-			6,328,948		$	4,975,503			17,130,317	$	6,029,328		$	3,426,946		$	(16,722,036	)	$	(184,551	)	$	(2,474,810	)
Balance at January 1, 2021		135		$	729,058			6,328,948		$	4,975,503			17,380,317	$	6,083,480		$	4,436,018		$	(18,220,705	)	$	(239,231	)	$	(2,964,935	)
Issuance of common stock units		-			-			-			-			250,000		54,152			45,848			-			-			100,000
Issuance of Series B preferred units		135			729,058			-			-			-		-			620,942			-			-			620,942
Issuance of warrants with subordinated note		-			-			-			-			-		-			114,094			-			-			114,094
Issuance of warrants with secured note		-			-			-			-			-		-			228,188			-			-			228,188
Net loss		-			-			-			-			-		-			-			(1,498,669	)		(54,680	)		(1,553,349	)
Balance at December 31, 2020		135		$	729,058			6,328,948		$	4,975,503			17,380,317	$	6,083,480		$	4,436,018		$	(18,220,705	)	$	(239,231	)	$	(2,964,935	)
Acquisition of Certain Assets of Halcyon Thruput, LLC		-			-			-			-			6,250,000		2,500,000			-			-			-			2,500,000
Issuances of common stock units		-			-			-			-			1,758,333		136,717			838,283			-			-			975,000
Warrant exercises		-			-			-			-			9,494,316		4,771,679			(1,429,679	)		-			-			3,342,000
Issuance of common shares for Convertible Promissory Note		-			-			-			-			618,660		217,769			-			-			-			217,769
Issuance of common shares for Senior Secured Promissory Note		-			-			-			-			1,000,000		1,942,500			-			-			-			1,942,500
Common shares issued to vendor for services		-			-			-			-			125,000		117,500			-			-			-			117,500
Issuance of common shares for extension of secured note		-			-			-			-			20,000		18,000			-			-			-			18,000
Change in common stock par value due to change in corporate domicile		-			-			-			-			-		(15,868,273	)		15,868,273			-			-			-
Conversion of Series A preferred stock								(6,328,948	)		(4,975,503	)		75,947,376		759			4,974,744			-			-			-
Series B preferred stock redemptions		(17	)		(137,500	)		-			-			-		-			-			-			-			-
Series B preferred stock dividend		-			-			-			-			-		-			-			(74,812	)		-			(74,812	)
Stock-based compensation		-			-			-			-			500,000		81,000			4,462,619			-			-			4,543,619
Net loss		-			-			-			-			-		-			-			(9,822,728	)		(2,247	)		(9,824,975	)
Balance at December 31, 2021		118		$	591,558			-		$	-			113,094,002	$	1,131		$	29,150,258		$	(28,118,245	)	$	(241,478	)	$	791,666
Issuance of common shares for extension of secured note		-			-			-			-			110,000		1			52,580			-			-			52,581
Modification of warrants for extension of promissory note to investor																			68,756									68,756
Series B preferred stock dividend		-			-			-			-			-		-			-			(80,002	)		-			(80,002	)
Stock-based compensation		-			-			-			-			-		-			4,758,257			-			-			4,758,257
Net loss		-			-			-			-			-		-			-			(7,031,771	)		9,776			(7,021,995	)
Balance at December 31, 2022		118		$	591,558			-		$	-			113,204,002	$	1,132		$	34,029,851		$	(35,230,018	)	$	(231,702	)	$	(1,430,737	)

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

F-6

~~Generation~~Evergreen ~~Hemp~~Sustainable Enterprises, Inc.

(formerly Generation Hemp, Inc.)

Consolidated Statements of Cash Flows

	For the year ended December 31,
	2021			2020
	2022			2021
Cash Flows From Operating Activities
Net loss	$	(97,~~824~~021,~~975~~995	)	$	(19,~~553~~824,~~349~~975	)
Loss from discontinued operations		(3259,~~213~~773	)		(3432,~~259~~213	)
Net loss from continuing operations		(96,~~792~~962,~~762~~222	)		(19,~~519~~792,~~090~~762	)
Adjustments to reconcile net loss from continuing operations to net cash from operating activities:
Depreciation and amortization		1,~~340~~005,~~425~~220			711,~~000~~340,425
Amortization of debt discount		380,282			-
Impairment expense		407,000			-
Stock-based compensation		4,543,619			-
Amortization of debt discount		52,581			380,282
Common shares issued to vendor for services		117,500			-
Stock-based compensation		4,758,257			4,543,619
Other income - PPP Loan forgiveness		(25,424	)		-
Common shares issued to vendor for services		-			117,500
Loss on disposal of property and equipment		6,938			539
Modification of warrants for extension of promissory note to investor		68,756			-
Change in fair value of marketable securities		(11,770	)		9,882
Other income - PPP Loan forgiveness		-			(25,424	)
Loss on disposal of property and equipment		-			6,938
Change in fair value of marketable securities		-			(11,770	)
Changes in operating assets and liabilities:
Accounts receivable		~~75,~~(470,719	)		-75,470
Inventories		~~(212~~64,~~518~~091	)		-(212,518	)
Prepaid expenses		(4,723	)		-
Prepaid expenses and other assets		(19,480	)		(4,723	)
Accounts payable and accrued liabilities		85466,~~939~~783			~~572~~85,~~466~~939
Net cash from operating activities – continuing operations		(3629,~~497,024~~733	)		(~~865~~3,~~203~~497,024	)
Net cash from operating activities – discontinued operations		-(2,820	)		~~31,716~~-
Net cash from operating activities		(3632,~~497,024~~553	)		(~~833~~3,~~487~~497,024	)
Cash Flows From Investing Activities
Capital expenditures		~~(77,715~~-	)		-(77,715	)
Acquisition of certain assets of Halcyon Thruput, LLC, net of acquired cash of $224,530		~~(1,525,470~~-	)		-(1,525,470	)
Proceeds from sale of investment in common stock		~~34,847~~-			-34,847
Net cash from investing activities – continuing operations		~~(1,568,338~~-	)		-(1,568,338	)
Net cash from investing activities – discontinued operations		-			-
Net cash from investing activities		(1,568,338	)		-
Cash Flows From Financing Activities
Proceeds for common stock issuable		-			50,000
Issuance of common stock units		-			925,000
Issuance of common stock units		925,000			100,000
Redemptions of Series B preferred stock					(137,500	)
Proceeds from Series B redeemable preferred stock		-			1,350,000
Series B preferred stock dividends paid					(16,500	)
Redemptions of Series B preferred stock		(137,500	)		-
Proceeds from warrant exercises		-			3,342,000
Series B preferred stock dividends paid		(16,500	)		-
Repayment of Halcyon bank note		-			(995,614	)
Proceeds from warrant exercises		3,342,000			-
Proceeds from notes payable - related parties		1,294,069			-
Repayment of Halcyon bank note		(995,614	)		-
Repayments of notes payable - related parties		(105,000	)		-
Proceeds from SBA PPP Loan		-			25,200
Proceeds from subordinated notes		-			410,000
Proceeds from secured note		-			1,000,000
Repayment of subordinated notes		(50,000	)		(1,100,000	)
Proceeds from subordinated notes		410,000			990,000
Payment of mortgage payable		(251,666	)		(117,793	)
Repayment of subordinated notes		(1,100,000	)		-
Net cash from financing activities – continuing operations		887,403			2,309,593
Payment of mortgage payable		(117,793	)		(6,625	)
Net change in cash		254,850			(2,755,769	)
Net cash from financing activities – continuing operations		2,309,593			3,508,575
Cash, beginning of period		20,656			2,776,425
Net cash from financing activities – discontinued operations		-			-
Cash, end of period	$	275,506		$	20,656
Net cash from financing activities		2,309,593			3,508,575
Net change in cash		(2,755,769	)		2,675,088
Cash, beginning of period		2,776,425			101,337
Cash, end of period	$	20,656		$	2,776,425

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

F-7

~~Generation~~Evergreen ~~Hemp~~Sustainable Enterprises, Inc.

(formerly Generation Hemp, Inc.)

Notes to Consolidated Financial Statements

1. ~~Description of the~~ Business

~~Generation~~Evergreen ~~Hemp~~Sustainable Enterprises, Inc. ~~(the~~ ~~“Company”),~~ (formerly ~~known~~Generation ~~as Home Treasure Finders~~Hemp, Inc.) (the “~~HTF~~Company”), was incorporated on August 21, 2021 in the State of Delaware. The Company was originally incorporated as Home Treasure Finders, Inc. (“HTF”) on July 28, 2008 in the State of Colorado. On November 27, 2019, HTF purchased approximately 94% of the common stock of Energy Hunter Resources, Inc. (“EHR”) in a series of transactions accounted for as a reverse merger ~~(the “Transaction”)~~. Upon closing ~~of the Transaction~~, HTF changed its name to Generation Hemp, Inc. In March 2023, the Company changed its name to Evergreen Sustainable Enterprises, Inc.

On January 11, 2021, we completed the acquisition of certain assets of Halcyon Thruput, LLC (“Halcyon”). With this acquisition, we commenced providing post-harvest and midstream services to hemp growers by drying, processing, cleaning and stripping harvested hemp directly from the field and wetbaled at our 48,000 square foot leased facility located in Hopkinsville, Kentucky. ~~Additionally,~~The ~~the~~ Company also offers safe storage services for processed hemp, which enables farmers to maximize strategic market timing. InWe ~~August~~market ~~2021~~two retail products, ~~the~~Gas ~~Company~~Monkey ~~launched~~Spill-Jack, an ~~its~~all-natural, ~~small~~plant-based, sustainable, and biodegradable loose absorbent, and Rowdy Rooster, an animal bedding consumer goods ~~product~~ ~~line~~product, ~~(“Rowdy~~each ~~Rooster”)~~ made from the hemp hurd byproduct that is produced from ~~its~~our hemp processing operations.

We also generate revenue from rental of our “Cannabis Zoned” (Hemp) warehouse property located in Denver, Colorado currently leased to an unaffiliated hemp seed company.

Our management team has been and continues to actively review acquisition candidates involved in the hemp industry that operate within a number of vertical businesses, ~~predominantly~~ predominantly within the midstream sector that are attractive to us and are within the hemp supply chain. Additionally, the Company has been studying the Bitcoin mining space and in January 2023 announced a new strategic initiative in this area and commenced bitcoin operations. Refer to Note 15 for more discussion.

~~Going~~Liquidity ~~Concern~~ and ~~Management’s Plans~~Going Concern – The Company is dependent upon obtaining additional funding to continue ongoing operations and to pursue its strategy ~~and~~ and execute its acquisition plans.

The Company will continue to pursue additional capital raising opportunities in order to fund future acquisitions and meet its obligations as they become due. We may not be successful in obtaining additional financing needed. In the event financing cannot be obtained, the Company may not be able to satisfy these plans and obligations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Impact of COVID-19 Pandemic on Our Business – Our business, results of operations and financial condition were adversely affected by the COVID-19 pandemic in 2020. The COVID-19 pandemic and measures taken to contain it subjected our business, results of operations, financial condition, stock price and liquidity to a number of material risks and uncertainties, all of which may continue or may worsen.

2. Summary of Significant Accounting Policies

Basis of Presentation – The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and U.S. Securities and Exchange Commission regulations. The consolidated financial statements comprise the financial statements of the Company, its wholly-owned subsidiaries, and subsidiaries that it controls due to ownership of a majority voting interest. Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Company obtains control, and continue to be consolidated until the date when such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the Company. All significant intercompany balances and transactions are eliminated upon consolidation.

F-8

Business Combinations – The Company accounts for business combinations under the acquisition method of accounting. Under this method, acquired assets, including separately identifiable intangible assets, and any assumed liabilities are recorded at their acquisition date estimated fair value. Determining the fair value of assets acquired and liabilities assumed involves the use of significant estimates and assumptions. The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents the goodwill amount resulting from the acquisition.

Use of Estimates – The preparation of financial statements in conformity with GAAP 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 period. Significant items subject to such estimates and assumptions include the (i) impairment of long-lived assets and goodwill, (ii) valuation allowances for deferred income tax assets and (iii) estimates of accrued liabilities. Actual results could differ from those estimates.

Revenue Recognition – Post-harvest and midstream services revenue is typically determined based on volumes processed at agreed-upon contractual prices and is recognized at the point in time when performance obligations under the terms of a contract with our customers are satisfied. This occurs when control of the product is transferred to our customers upon completion of our processing.

Rental revenue is recognized based on the contractual cash rental payments for the period.

Cash – The Company maintains its deposits of cash in financial institutions, which may at times exceed amounts covered by insurance provided by the U.S. Federal Deposit Insurance Corporation (“FDIC”). The Company has not experienced any losses related to amounts in excess of FDIC limits.

Inventories – Inventories consist of processed hemp product and are stated at the lower of cost or net realizable value. Cost, which includes the cost of raw materials, labor and overhead, is determined using the first-in, first-out method. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal and transportation.

Property and Equipment – Property ~~property~~ and equipment is stated at cost and depreciated using the straight-line method over the estimated useful lives of assets. Upon disposition, the cost and accumulated depreciation are removed and any gain or loss on the disposal is reflected in the statements of operations. The cost of maintenance and repairs is charged to income as incurred; significant renewals and improvements are capitalized.

Leases – The Company’s lease arrangements are operating leases which are capitalized on the balance sheet as right-of-use (“ROU”) assets and obligations. Right of use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. These are recognized at the lease commencement date based on the present value of payments over the lease term. If leases do not provide for an implicit rate, we use our incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term as the lease payments. Lease expense is recognized on a straight-line basis over the lease term.

Intangible Assets – ~~Definite~~Finite-lived intangible assets are amortized and are tested for impairment when an event occurs or circumstances change that indicate it is more likely than not that an impairment exists. Intangible assets consist of customer relationships and non-compete agreements acquired in the acquisition of certain assets of Halcyon. These intangibles have a gross carrying amount of $2.7 million and accumulated amortization of $818 thousand at December 31, 2021. Future amortization expense in each of the next five years amounts to $587 thousand for 2022, $419 thousand for 2023, $278 thousand for 2024, $194 thousand for 2025, $130 thousand for 2026 and $250 thousand thereafter.

Impairment of Long-Lived Assets – We review long-lived assets for potential impairment when events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. In this assessment, future pre-tax cash flows (undiscounted) resulting from the use of the asset and its eventual disposal are estimated. If the undiscounted future cash flows are less than the carrying amount of the asset, an impairment loss is recognized for the difference between its carrying value and estimated fair value.

~~Common Stock Units Issuable~~ Noncontrolling Interest – ~~From time~~Noncontrolling tointerests ~~time,~~represent the ~~Company~~portion ~~accepts~~of ~~payment~~net ~~from~~assets ~~investors~~in ~~for~~consolidated ~~common~~entities ~~stock~~that ~~unit~~are ~~subscriptions~~not ~~pursuant~~owned toby the ~~approved~~Company. ~~offerings~~As of ~~securities. Amounts~~December ~~received~~31, ~~before~~2022 ~~completion~~ and ~~closing~~2021, ofminority ~~the~~investors ~~offerings~~owned ~~are~~approximately 6% ~~reported~~of ~~as liabilities~~EHR.

F-9

~~Noncontrolling~~Stock-based Compensation ~~Interest~~ – We ~~Noncontrolling interests~~account ~~represent~~for ~~the~~stock-based ~~portion~~compensation ofusing ~~net~~the ~~assets~~fair invalue ~~consolidated~~method. ~~entities~~Compensation ~~that~~cost ~~are~~for ~~not~~equity incentive ~~owned~~awards byis based on the ~~Company.~~fair Asvalue of ~~December~~the ~~31,~~equity ~~2021~~instrument generally on the date of grant and is recognized over the requisite ~~2020,~~service ~~minority~~period. ~~investors~~Forfeitures ~~owned~~are ~~approximately~~recognized 6%as ofthey ~~EHR~~occur.

Stock-based Compensation – We account for employee stock-based compensation using the fair value method. Compensation cost for equity incentive awards is based on the fair value of the equity instrument generally on the date of grant and is recognized over the requisite service period. Forfeitures are recognized as they occur.

Income Taxes – Income taxes are accounted for using a balance sheet approach. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax asset (including the impact of available carryback and carryforward periods), projected future taxable income, and tax-planning strategies in making this assessment. A valuation allowance for deferred tax assets is recorded when it is more likely than not that the benefit from the deferred tax asset will not be realized.

The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which a change in judgment occurs. The Company had no material uncertain tax positions as of December 31, 2022 ~~2021~~ or ~~2020~~2021. Income tax returns we file may be routinely examined by tax authorities. The statute of limitations is currently open for tax returns filed after ~~2017~~2018.

The Company is subject to the Texas margin tax; however, tax expense was zero for the years ended December 31, ~~2021~~2022 and ~~2020~~2021.

Discontinued Operations – In connection with the Transaction, management determined to fully divest of EHR’s oil and gas activities. As such, these activities are presented as discontinued operations for each of the periods presented.

The Company follows the successful efforts method of accounting for its oil and gas properties. Costs to acquire mineral interests in oil and gas properties and to drill and equip new development wells and related asset retirement costs are capitalized. In 2019, the Company’s oil and gas properties became fully impaired and the carrying amount of the properties was expensed to the market decline and the Company’s determination to exit the oil and gas business. The oil & gas properties have limited production and operations for which the Company recognizes its share as a non-operating working interest owner. Oil & gas revenue is recognized for discontinued operations based on delivered quantities in the amount of the consideration to which the Company is entitled.

The Company records a liability for the plugging, abandonment and remediation of its properties at the end of their productive lives. The Company computes the liability for asset retirement obligations by calculating the present value of estimated future cash flows related to each property. This requires the Company to use significant assumptions, including current estimates of plugging and abandonment costs, annual inflation of these costs, the productive lives of wells and its risk-adjusted interest rate. Changes in any of these assumptions can result in significant revisions to the estimated asset retirement obligations.

Asset retirement obligations are recorded as a liability at their estimated present value at the asset’s inception, with an offsetting increase to producing properties in the accompanying balance sheet which is amortized to expense on a unit-of-production basis. Periodic accretion of the discount on asset retirement obligations is recorded as expense.

F-10

Fair Value Measurements – 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. The three levels related to fair value measurements are as follows:

Level 1 —	Observable inputs such as quoted prices in active markets for identical assets or liabilities.

Level 2 —	Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active or other inputs that are observable or can be corroborated by observable market data.

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. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

F-10

The estimated fair values of cash, accounts receivable, accounts payable and indebtedness approximate their carrying amounts due to the relatively short maturity of these instruments.

Earnings (loss) per Share – Basic earnings (loss) per share amounts are calculated by dividing income available to common shareholders, after deducting preferred stock dividends, by the weighted average number of shares of common stock outstanding. Diluted earnings per share amounts are calculated by dividing net income by the weighted average number of shares of common stock and common stock equivalents outstanding. Common stock equivalents represent shares issuable upon the assumed conversion of preferred stock, outstanding convertible notes and the assumed exercise of common stock options and warrants outstanding.

Major Customer and Concentration of Credit Risk – We estimate an allowance for doubtful accounts based on an analysis of specific customers, taking into consideration the age of past due accounts and an assessment of the customer’s ability to pay. An allowance for doubtful accounts was not needed as of December 31, ~~2021~~2022 or ~~2020~~2021.

During ~~2021~~2022, one customer accounted for approximately 91 96% of our post-harvest and midstream services revenue. Amounts due from this customer represented all of our accounts receivable at December 31, ~~respectively~~2022. During 2021, one customer accounted for approximately 91% of our post-harvest and midstream services revenue. No amounts were due from this customer at December 31, 2021.

Our rental revenue is derived from a single lessee on a commercial warehouse owned by the Company. There were no amounts due from this customer at December 31, ~~2021~~2022 or ~~2020~~2021.

Reclassifications – Financial statements presented for prior periods include reclassifications that were made to conform to the current-year presentation.

Recent Accounting Pronouncements – In December 2019, the FASB issued ASU 2019-12, Income Taxes, which enhances and simplifies various aspects of the income tax accounting guidance, including requirements such as tax basis step-up in goodwill obtained in a transaction that is not a business combination, ownership changes in investments, and interim-period accounting for enacted changes in tax law. We adopted this standard in the first quarter of 2021. Adoption of this ASU did not have a significant impact on our consolidated financial statements.

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). The new standard reduces the number of accounting models for convertible debt instruments and convertible preferred stock, and amends the guidance for the derivatives scope exception for contracts in an entity’s own equity. The standard also amends and makes targeted improvements to the related earnings per share guidance. The ASU is effective for fiscal years beginning after December 15, 2021. The standard allows for either modified or full retrospective transition methods. The Company ~~will~~ ~~adopt~~adopted this standard on January 1, 2022. WeThe ~~do not expect that the~~ adoption of this ASU ~~will~~did not have a significant impact on our consolidated ~~financial~~ financial statements.

~~F-11~~There are no other new accounting pronouncements that are expected to have a material impact on the consolidated financial statements.

3. ~~Acquisition~~Property and Equipment

On January 11, 2021, the Company completed the acquisition of certain assets of Halcyon pursuant to the Asset Purchase Agreement dated March 7, 2020, as amended on January 11, 2021 and October 8, 2021. The purchase consideration totaled approximately $6.1 million consisting of 6,250,000 shares of Company common stock valued at $2.5 million ($0.40 per share; restricted from trading for a period of up to one year), $1.75 million in cash, a promissory note for $850,000 issued by the Company’s subsidiary, GenH Halcyon Acquisition, LLC, and guaranteed by Gary C. Evans, CEO of the Company, and assumption of approximately $1.0 million of new indebtedness of Halcyon. The Company was granted an option to purchase the real estate occupied by Halcyon for $993,000. This option is exercisable at any time before its expiration on January 11, 2022. This purchase option was subsequently amended and extended as disclosed in Note 14.

The acquisition was accounted for as a business combination where the Company is the acquirer and the acquisition method of accounting was applied in accordance with GAAP. Accordingly, the aggregate value of the consideration we paid to complete the acquisition was allocated to the assets acquired based upon their estimated fair values on the acquisition date.

The following table summarizes the purchase price allocation for the assets acquired:

Accounts receivable	$	75,470
Other working capital		224,530
Property and equipment, other		1,912,900
Intangibles:
Non-competition agreements		63,176
Customer relationships		2,612,650
Other assets - Purchase option on real estate		407,000
Goodwill		799,888
Assets acquired	$	6,095,614

Intangible assets consist of customer relationships and non-compete agreements, each having definite-lives. These intangible assets are being amortized over the estimated useful life on an accelerated basis reflecting the anticipated future cash flows of the Company post acquisition of Halcyon. The weighted-average useful life assigned to the intangible assets is three years.

The results of operations for the acquired Halcyon assets have been included in the Company’s consolidated financial statements since the January 11, 2021 acquisition date.

Concurrent with the closing of the asset acquisition, the Company entered into term employment agreements with two executives to serve as vice presidents of the Company for a term of at least two years and the issuance of 250,000 shares of restricted common stock of the Company as a signing bonus. Such shares are subject to restrictions on the trading or transfer of such common stock.

Further, the term employment agreements each provide for the payment by the executives of liquidated damages if the employee terminates his employment without good reason during the initial term, other than due to the employee’s death or disability. Such liquidated damages total $375,000 if termination occurs prior to January 11, 2023.

On March 3, 2021, the Company repaid the outstanding principal and interest balance on the $850,000 promissory note issued in connection with the acquisition.

Supplemental Pro Forma Information – The supplemental pro forma financial information presented below is for illustrative purposes only and is not necessarily indicative of the financial position or results of operations that would have been realized if the acquisition of certain assets of Halcyon had been completed on the date indicated, nor is it indicative of future operating results or financial position. The pro forma adjustments are based upon currently available information and certain assumptions that management believes are reasonable under the circumstances.

The supplemental pro forma financial information reflects pro forma adjustments to present the combined pro forma results of operations as if the acquisition had occurred on January 1, 2020, to give effect to certain events that management believes to be directly attributable to the acquisition. These pro forma adjustments primarily include:

● an increase to depreciation and amortization expense that would have been recognized due to acquired tangible and intangible assets; and

● an adjustment to interest expense to reflect the reduced borrowings due to the repayment of Halcyon’s historical debt in conjunction with the acquisition;

F-12

The supplemental pro forma financial information for the periods presented is as follows:

	For the year ended December 31,
	2021			2020
Revenue, continuing operations	$	675,762		$	3,050,017
Income (loss) from continuing operations		(9,847,650	)		(841,518	)
Earnings (loss) per common share:
Basic and diluted	$	(0.17	)	$	(0.05	)

4. Property and Equipment

Property and equipment consisted of the following:

	Useful	December 31,	~~December 31,~~
	Life (yrs)	2022	~~2021~~			2021	~~2020~~
Land		$	$96,000	~~96,000~~		$	$96,000	~~96,000~~
Warehouse	30		916,500	~~916,500~~			916,500	~~916,500~~
Leasehold Improvements	3		473,601	~~473,601~~			473,601	-
Machinery and equipment	5-7		1,506,447	~~1,506,447~~			1,506,447	-
Vehicles	4		149,440	~~149,440~~			149,440	~~149,440~~
Computer equipment and software	3		46,825	~~46,825~~			46,825	~~43,196~~
Office furniture and equipment	3-5		17,294	~~17,294~~			17,294	~~17,294~~
Subtotal			3,206,107	~~3,206,107~~			3,206,107	~~1,222,430~~
Less accumulated depreciation and amortization			(1,044,155	~~(625,445~~)	)		(625,445	~~(102,938~~)	)
Total property and equipment, net		$	$2,161,952	~~2,580,662~~		$	$2,580,662	~~1,119,492~~

F-11

4. Intangible and Other Assets

The following table summarizes information related to finite-lived intangible assets:

	December 31, 2022							December 31, 2021
	Gross							Gross
	Carrying		Accumulated					Carrying		Accumulated
	Amount		Amortization			Net		Amount		Amortization			Net
Customer relationships	$	2,612,649	$	(1,362,311	)	$	1,250,338	$	2,612,649	$	(796,858	)	$	1,815,791
Non-competition agreements		63,176		(42,116	)		21,060		63,176		(21,059	)		42,117
Total	$	2,675,825	$	(1,404,427	)	$	1,271,398	$	2,675,825	$	(817,917	)	$	1,857,908

Future amortization expense for intangible assets in each of the next five years are expected to be $419 thousand for 2023, $278 thousand for 2024, $194 thousand for 2025, $130 thousand for 2026 and $86 thousand for 2027.

Other assets included $407,000 at December 31, 2021 for the Company’s option to purchase the facility located in Hopkinsville, Kentucky leased from Halcyon. Under this agreement, the Company had the option to purchase the facility on or before August 25, 2022, as amended, for a purchase price of $993 thousand. This agreement was not renewed upon its expiration. Impairment expense totaling $407 thousand was recognized in the third quarter of 2022 as a result.

5. Notes Payable – Related Parties

Notes payable – related parties consisted of the following:

	December 31,
	2021		2020
	2022		2021
Senior Secured Promissory Note	$	-	$	1,500,000
Subordinated Promissory Note to CEO	$	523,551	$	523,551
Convertible Promissory Note		-		208,874
Convertible Promissory Note to CEO		1,107,069		410,000
Subordinated Promissory Note to CEO		523,551		490,000
Convertible Promissory Note to CEO		410,000		-
Secured Promissory Note to Coventry Asset Management, LTD.		1,000,000		1,000,000
Subordinated Promissory Note to Investor		~~250~~200,000		~~500~~250,000
Total		2,183,551		3,698,874
Promissory Note to Investment Hunter, LLC		492,000		-
Less debt discounts		-		(362,282	)
Total notes payable – related parties	$	3,322,620	$	2,183,551
Total notes payable – related parties	$	2,183,551	$	3,336,592

~~Senior~~Subordinated ~~Secured~~ Promissory Note –to OnCEO – ~~March~~Our ~~31,~~CEO ~~2017,~~made advances to the Company ~~entered~~during ~~into~~2020 under a ~~subscription~~subordinated ~~agreement~~promissory ~~under~~note ~~which~~in wethe ~~issued~~amount aof $~~3,000,000~~524 ~~10%~~thousand ~~Senior~~initially ~~Secured~~due September ~~Promissory~~30, ~~Note to~~2021. ~~Satellite~~This ~~Overseas~~note ~~(Holdings)~~was ~~Limited~~amended ~~(“SOHL”),~~to a ~~stockholder~~new ofmaturity ~~the~~date ~~Company’s~~of ~~common~~January ~~shares~~1, 2023. The note bore interest ~~rate~~at of10% per annum. Accrued ~~the~~interest ~~Senior~~on ~~Secured~~this ~~Promissory~~subordinated ~~Note~~promissory ~~was~~note ~~12%.~~totaled On$60 ~~March~~thousand 9,at ~~2021~~December 31, ~~the~~2022. ~~total~~In ~~principal~~January 2023, ~~interest~~the ~~and~~amounts ~~accrued~~due ~~fees~~ under ~~the~~this ~~Senior Secured~~note ~~Promissory~~were ~~Note~~restructured ~~was~~and ~~contributed~~rolled tointo ~~the~~a ~~Company~~new ~~and~~Secured ~~exchanged~~Promissory ~~into~~Note ~~1,000,000~~from ~~common~~our ~~shares~~CEO (see Note 15).

~~F-13~~Convertible Promissory Note to CEO – In 2021, our CEO made advances totaling $410 thousand to the Company under a convertible promissory note. Additional advances made in 2022 totaled $697 thousand. The convertible note initially matured on January 1, 2022 but was subsequently amended to extend the maturity date to January 1, 2023. The note bore interest at 10%. The principal and interest due on the convertible note were convertible, at the option of the holder, into restricted shares of the Company’s common stock at an initial conversion price of $0.50 per share but that was lowered in July 2022 to $0.30 per share. Accrued interest on this convertible promissory note totaled $107 thousand at December 31, 2022. In January 2023, the amounts due under this note were restructured and rolled into a new Secured Promissory Note from our CEO (see Note 15).

Convertible Promissory Note – In October 2019, HTF issued a convertible promissory note to EHR in exchange for EHR’s payment of HTF’s accounts payable and Transaction expenses. The convertible promissory note bore interest at 4% per annum and was convertible by the holder at any time into common stock of the Company at a rate of $0.352 per share. On March 9, 2021, the convertible promissory note, together with accrued interest thereon, was converted into 618,660 common shares under the terms of the note.F-12

~~Subordinated~~Secured Promissory Note and Warrants to ~~CEO~~Coventry Asset Management, LTD. – ~~Our CEO~~On ~~made~~December ~~advances~~30, to2020, the Company ~~during~~received ~~2020~~proceeds ~~under~~from issuance of a ~~subordinated~~secured promissory ~~initially~~ note ~~due~~in ~~September~~principal 30amount of $1 million to Coventry Asset Management, ~~2021~~LTD, a Company stockholder. ~~This~~The promissory note ~~was~~is ~~amended~~secured by the property acquired in the acquisition of certain assets of Halcyon. The unpaid balance of the secured promissory tonote bears interest at a ~~new~~rate of 14% per annum. The promissory note has been extended seven times including the issuance of 20,000 restricted common shares as extension fees each for the first five extensions and the issuance of 50,000 restricted common shares for the last two extensions. The maturity date of ~~June~~the 30promissory note is December 31, ~~2022~~2023, as amended. If before December 31, 2023, the Company raises new equity capital of $35 million or more, then the full amount ~~outstanding~~ outstanding under the promissory note is due within five days. ~~The~~As ~~note~~amended, ~~bears~~principal ~~interest~~payments atof ~~10%~~$250 ~~per~~thousand ~~annum~~each are due June 1, 2023 and August 31, 2023. Accrued interest on this ~~subordinated~~secured ~~promissory~~ note totaled $~~7,602~~200 thousand at December 31, ~~2021~~2022.

~~Convertible~~ Subordinated Promissory Note and Warrants to ~~CEO~~Investor – In ~~2021,~~On ~~our~~December ~~CEO~~30, ~~made advances totaling $410~~2020,~~000~~ to the Company ~~under~~issued a ~~convertible~~subordinated promissory note. ~~The~~in ~~convertible note matured on January~~principal 1,amount ~~2022~~of ~~but~~$500 ~~was~~thousand ~~subsequently amended~~ to ~~extend~~an ~~the~~accredited ~~maturity~~investor ~~date~~who tois ~~June~~also ~~30,~~a ~~2022~~Company stockholder. IfThe ~~the~~ Company ~~raises~~previously ~~new~~made ~~equity~~principal ~~capital~~payment totaling of $3300 ~~million or~~thousand. ~~more,~~The ~~then~~unpaid ~~the~~balance ~~full~~of ~~amount outstanding under~~ the ~~note~~Subordinated isNote ~~due within five days. The note~~ bears interest at a rate of 10% per annum. The ~~principal~~subordinated ~~and interest~~note ~~due~~principal ontogether ~~the~~with ~~convertible~~accrued ~~note~~and ~~may~~unpaid beinterest ~~converted~~was due, atas ~~the~~previously ~~option~~amended, ofon ~~the~~March ~~holder~~31, ~~into~~2022 ~~restricted~~but ~~shares~~was ofextended ~~the~~to ~~Company’s~~June ~~common~~30, ~~stock~~2022. atOn aMarch ~~conversion~~1, ~~price~~2023, ~~equal~~the toCompany paid $~~0.50~~240 ~~per~~thousand ~~share.~~in ~~Accrued~~full ~~interest~~repayment onof this ~~convertible promissory~~ note ~~totaled~~and ~~$19,118~~accrued atinterest ~~December 31, 2021~~thereon.

~~Secured~~The ~~Promissory~~holder ~~Note and~~of ~~Warrants to Coventry Asset Management, LTD. – On December 30, 2020,~~ the ~~Company~~subordinated note received ~~proceeds from issuance of~~ a ~~secured~~ ~~promissory~~warrant ~~note in principal amount of $1,000,000~~ to ~~Coventry~~purchase ~~Asset~~500 ~~Management,~~thousand ~~LTD,~~shares aof ~~Company~~common ~~stockholder.~~stock ~~The~~exercisable ~~promissory~~for ~~note~~cash isat ~~secured~~an byexercise ~~the~~price ~~property acquired in the acquisition~~ of ~~certain~~$0.352 ~~assets~~per ~~of Halcyon~~share. ~~The~~As ~~unpaid~~consideration for ~~balance of~~ the ~~secured~~April ~~promissory~~2022 ~~note bears interest at a rate of 10% per annum and initially matured on June 30~~extension, ~~2021. The promissory note has been extended three times each including~~ the ~~issuance~~term of ~~20,000 restricted~~this ~~common~~warrant ~~shares~~was asextended ~~extension~~by ~~fees.~~one ~~The~~year ~~maturity~~to ~~date~~December ~~of the promissory note is April~~ 30, ~~2022, as amended~~2023. IfThe ~~before April 30, 2022 the~~ Company ~~raises~~recognized ~~new equity capital of~~ $1069 ~~million or more, then the full amount outstanding under the promissory note is due within~~thousand ~~five days. Additionally, the holder~~ of ~~the~~interest ~~promissory~~expense ~~note~~in ~~was given an option exercisable until April 7,~~ 2022 tofor ~~convert $250,000 of~~ the ~~outstanding~~modification ~~principal~~related ~~balance~~to ~~into~~this ~~shares~~extension of the ~~Company’s~~warrant ~~common stock at an exercise price of $0~~term.~~60 per share. Accrued interest on this secured note totaled $100,275 at December 31, 2021.~~

~~The~~Promissory ~~holder~~Note ofto Investment ~~the~~Hunter, ~~secured promissory~~LLC ~~note~~– ~~received~~In 2022, Investment Hunter, LLC, a ~~warrant~~Texas LLC controlled by our CEO, made advances totaling $492 thousand to the ~~purchase~~Company under a promissory note due January 1,~~000~~ 2023,~~000~~ ~~shares~~as ofamended. ~~common~~If ~~stock~~the ~~exercisable~~Company atraises annew ~~exercise~~equity ~~price~~capital of $~~0.352~~3 ~~per~~million ~~share~~or ~~upon~~more, then ~~origination~~the offull amount outstanding under the ~~promissory~~note is due within five days. The note inbears ~~2020~~interest at 10% per annum. ~~This~~Accrued ~~warrant~~interest ~~was~~on ~~subsequently~~this subordinated ~~exercised~~promissory innote ~~the~~totaled ~~first~~$43 ~~quarter~~thousand ofat ~~2021~~December 31, 2022.

Subordinated Promissory Note and Warrants to Investor – On December 30, 2020, the Company issued a subordinated promissory note in principal amount of $500,000 to an accredited investor who is also a Company stockholder. The unpaid balance of the Subordinated Note bears interest at a rate of 10% per annum. The Company made a principal payment of $250,000 in April 2021. The subordinated note principal together with accrued and unpaid interest was due, as previously amended, on March 31, 2022 but was subsequently extended. As subsequently amended, a payment of $50,000 is due March 31, 2022 and the remaining principal of $200,000 together with accrued interest is due on June 30, 2022. If at any time prior to the note’s maturity the Company raises new equity capital of $5 million or more, then the full amount outstanding under the note is due within five days. Accrued interest on this subordinated promissory note totaled $18,699 at December 31, 2021.

F-14

The holder of the subordinated note received a warrant to purchase 500,000 shares of common stock exercisable for cash until December 30, 2022 at an exercise price of $0.352 per share.

6. Other Indebtedness

~~Other~~Mortgage ~~indebtedness~~Payable ~~consisted~~and Operating Lease –The Company is obligated under a mortgage payable dated September 15, 2014 secured by its warehouse property located in Denver, Colorado. The note has been amended a number of times to a maturity date of October 1, 2023. In the ~~following:~~latest extension, the Company made a principal payment of $25 thousand plus accrued interest in January 2023 and agreed to make seven additional monthly principal payments of $25 thousand plus accrued interest each beginning on March 1, 2023. A final payment of $50 thousand plus accrued interest is due at maturity. The interest rate on the mortgage payable is 12%. If before the final maturity of the mortgage payable, the Company raises new equity capital of $5 million or more, then the full amount outstanding is due within ten days.

	December 31,
	2021			2020
Mortgage Payable	$	501,668		$	619,461
Paycheck Protection Program Loan		-			25,200
Total		501,668			644,661
Less current portion		(501,668	)		(619,461	)
Total other indebtedness - long-term	$	-		$	25,200

The Company leases the Denver warehouse property to a tenant under an operating lease which was renewed with a new tenant and extended to August 1, 2023 for a monthly rent of $7.5 thousand. The lease requires a true-up with the tenant for property taxes and insurance paid by the Company and requires the tenant to maintain the interior and exterior of the warehouse (except for the roof). The lease provides for a rent abatement in the first and last month of the contracted extension. Minimum future rents for 2023 are $52 thousand.

~~Mortgage Payable and~~Paycheck ~~Operating~~Protection ~~Lease~~Program Loan – Congress ~~The~~created ~~Company~~the isPaycheck ~~obligated~~Protection ~~under~~Program a(“PPP”) ~~mortgage~~under ~~payable~~the ~~dated~~Coronavirus ~~September 15~~Aid, Relief, ~~2014~~and ~~secured~~Economic bySecurity ~~its~~Act ~~warehouse~~(“CARES ~~property located~~Act”) into ~~Denver,~~provide ~~Colorado.~~forgivable ~~The~~loans ~~note~~to ~~provided~~eligible ~~for~~small abusinesses ~~25-year~~facing ~~amortization~~economic ~~period~~hardship to ~~and~~retain anU.S. ~~initial~~employees ~~interest~~on ~~rate~~their ofpayroll 9%during ~~annually.~~the ~~The~~Coronavirus ~~note has~~Disease ~~been~~2019 ~~amended~~(“COVID-19”) ~~several~~pandemic. ~~times~~PPP toloan arecipients ~~maturity~~may be ~~date~~eligible ofto ~~January~~have ~~15,~~their ~~2022.~~loans Inforgiven ~~January~~if ~~2022,~~ the ~~note~~funds ~~was~~were ~~again~~used ~~amended~~for toeligible aexpenses. ~~new~~On ~~maturity date of~~ April 1529, ~~2022.~~2020, ~~The~~we ~~Company~~received isdisbursement ~~paying~~of an ~~monthly~~approved ~~extension~~PPP ~~fees~~loan in the amount of $~~1,000~~25 ~~each~~thousand. The ~~new~~Company ~~monthly~~received ~~payment~~notice ofthat the ~~note~~PPP isLoan ~~$5,800~~principal ~~including~~ and interest atthereon anwas ~~effective~~fully forgiven ~~rate~~on ofApril ~~approximately~~20, ~~12%~~2021.

The Company leases the Denver warehouse property to a tenant under an operating lease which was renewed with a new tenant and extended to August 1, 2023 for a monthly rent of $7,500. The lease requires a trueF-up with the tenant for property taxes and insurance paid by the Company and requires the tenant to maintain the interior and exterior of the warehouse (except for the roof). The lease provides for a rent abatement in the first and last month of the contracted extension. Minimum future rents for 2022 are $90,000 and for 2023 are $52,500.13

Paycheck Protection Program Loan – Congress created the Paycheck Protection Program (“PPP”) under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) to provide forgivable loans to eligible small businesses facing economic hardship to retain U7.~~S. employees on their payroll during the Coronavirus Disease 2019 (“COVID-19”) pandemic.~~ Leases

~~PPP~~Office ~~loan~~Space ~~recipients~~– The ~~may~~Company beleases ~~eligible~~office tospace ~~have~~in ~~their loans~~Fort ~~forgiven~~Worth, ifTexas ~~the funds were used~~ for ~~eligible~~managerial ~~expenses over the eight-week coverage period commencing when the loan was originally disbursed~~offices. ~~The~~This ~~amount~~lease ofrequires ~~forgiveness~~monthly ~~may~~payments ~~be reduced if the percentage~~ of ~~eligible~~$2 ~~expenses~~thousand ~~attributed~~and is month-to-month. ~~nonpayroll~~Lease ~~expenses~~expense ~~exceeds~~for ~~25% of~~this ~~the~~facility ~~loan,~~totaled if$24 ~~employee~~thousand ~~headcount decreases, or compensation decreases by more than 25%~~ for ~~each~~2022 ~~employee~~and ~~making less than~~ $~~100,000~~22 ~~per year,~~thousand ~~unless~~for ~~the reduced headcount or compensation levels are restored~~2021.

OnHemp ~~April~~Processing 29Operating Facility – The Company leases its operating facility in Kentucky from Oz Capital, ~~2020~~LLC, wea ~~received~~related ~~disbursement~~party, ofunder ~~an approved~~a ~~PPP~~lease ~~loan~~expiring inMay ~~the~~31, ~~amount~~2024. The lease provides for monthly payments of $~~25,200~~10 thousand. ~~The~~Oz ~~Company~~Capital, ~~received~~LLC ~~notice~~is ~~that~~responsible for all taxes and maintenance under the ~~PPP~~lease. ~~Loan~~Lease expense ~~principal~~for this facility totaled $123 thousand for 2022 and ~~interest~~$119 ~~thereon~~thousand for 2021. A right-of-use asset and lease liability is recorded ~~was~~for ~~fully~~this ~~forgiven~~lease. onAs ~~April~~the 20lease does not provide an implicit rate, ~~2021~~the Company used its estimated incremental borrowing rate of 10% in determining the present value of the lease payments.

FFuture Bitcoin Mining Premises – In 2022, the Company entered a five-15year commercial lease for land and premises in Arkansas. We expect to use these premises as a future Bitcoin mining location because of its favorable power rates and land availability. The lease commences once the Company begins receiving power for its operations conducted at the location. The monthly rent will vary from a minimum of $1 thousand per megawatt of power usage monthly up to $4 thousand per megawatt monthly depending on the average power usage over a trailing 90-day period and the price of bitcoin. We anticipate commencing operations at the leased premises in 2023.

78. Commitments and Contingencies

Leases – The Company assumed Halcyon’s lease of office space in Fort Worth, Texas for managerial offices. This lease requires monthly payments of $2,000 and is month-to-month. Lease expense for this facility totaled $22,000 in 2021.

The Company leases its operating facility in Kentucky from Oz Capital, LLC, a related party, under a lease expiring May 31, 2024. The lease provides for monthly payments of $10,249. Oz Capital, LLC is responsible for all taxes and maintenance under the lease. Lease expense for this facility totaled $119,351 in 2021. A right-of-use asset and lease liability is recorded for this lease. As the lease does not provide an implicit rate, the Company used its estimated incremental borrowing rate of 10% in determining the present value of the lease payments.

Pending Insurance Claim – In 2019, drying equipment that Halcyon purchased from a third party was being placed into service when a fire loss subsequently occurred and destroyed the equipment causing significant business interruption. The cost of this drying equipment totaled $1.1 million. In 2020, Halcyon received, as partial payment, insurance proceeds of $595,000 from its insurance carrier. The Company has made a formal claim against the insurance carrier and is pursuing all available options to recover the unpaid amounts.

Litigation – From time to time, we are subject to various litigation and other claims in the normal course of business. Below is a discussion of specific matters. We cannot estimate the ultimate outcome of these matters.

~~Generation~~Evergreen Sustainable Enterprises, Inc. (formerly Generation Hemp, Inc.) v. Colorado ~~Mills~~Mill Equipment, LLC~~, Dallas, Texas Small Claims Court Case No. JS 22.00018A~~

The ~~Defendant~~defendant sold to the Company a faulty piece of equipment for $16~~,000~~ thousand and will not refund to the Company the purchase price after repeated attempts to return their equipment. AAn original lawsuit ~~was~~ filed by the Company against Colorado ~~Mills~~Mill Equipment in January 2022 in Dallas County was subsequently dismissed due to jurisdiction. A second lawsuit was subsequently filed in El Paso County, Colorado and is currently pending.

Halcyon Thruput, LLC, Plaintiff v. United National Insurance Company, Defendant, United States District Court for the Northern District of Texas, Dallas Division, Case No. 3:21-CV-3136-K.

Halcyon Thruput, LLC (Halcyon) obtained an all-risks commercial insurance policy, including an Equipment Breakdown Endorsement (Policy) from United National Insurance Company (UNIC) to provide substantial coverages for Halcyon Thruput LLC’s (Halcyon) $1~~,203,735~~.2 million hemp processing dryer (Dryer) at its facility in Hopkinsville, Kentucky. During the Policy period, the Dryer caught fire due to the Dryer being defectively designed.

While UNIC has paid a number of Halcyon’s claims, Halcyon’s claim for the cost of the replacement Dryer of $1~~,380,374~~.5 million was denied as described below.

F-16

Buyer, a wholly owned subsidiary of the Company, pursuant to an Asset Purchase Agreement as twice amended, then acquired all the assets of Halcyon, except for the right to the proceeds of UNIC’s insurance policy since the Policy prohibited assignment. Halcyon and Buyer agreed that Buyer’s principal, Gary C. Evans, had the right to control the litigation, engage counsel for Halcyon and make all decisions relating to any proceeds received in the litigation by settlement or otherwise.

Halcyon’s suit against UNIC, which was removed to ~~federal~~ federal court, seeks ~~$796,865.53~~over ~~(the cost of the replacement dryer of~~ $1~~,380,374,~~ ~~less~~million ~~a credit for $583,508.47 previously paid by UNIC to Halcyon for the Dryer fire=$796,865.53)~~ plus statutory interest on that sum from August 10, 2020 for violating the Texas Insurance Code’s requirement that claims be promptly paid, additional statutory penalties, and attorneys’ fees. Certain documents have been executed between the Company, Halcyon and legal counsel, which provide for a sharing of costs and expenses and awards, if any, against UNIC. Mediation of the case iswas ~~set~~held ~~for~~in April ~~12,~~2022 where no agreement was reached by the parties. Depositions of the Company’s expert witnesses were completed in July 2022 and of UNIC’s representatives in September 2022.

In August 2022, the Company received a second payment from UNIC of $357 thousand as a partial settlement of this claim, which amount was reported as other income in the consolidated financial statements.

F-14

JDONE, LLC v. Grand Traverse Holdings, LLC and John Gallegos, Denver District Court Case No. 2019CV33723

JDONE, LLC (“JDONE”), is a wholly owned subsidiary of the Company and landlord of a commercial warehouse building ~~that~~in ~~was~~Denver, ~~previously~~brought ~~leased~~suit toagainst Grand Traverse Holdings, LLC ~~on December 31, 2018~~ for adefault ~~term~~ of 61its ~~months,~~commercial ~~with~~lease ~~a personal guaranty from Defendant, John Gallegos. On April 12, 2019, Grand Traverse presented JDONE with an alleged forged, signed copy~~ of the ~~draft~~warehouse ~~early~~from ~~termination amendment that~~ JDONE ~~had previously rejected~~. ~~JDONE~~This has suffered damages due to Defendant’s alleged misconduct of approximately $823,504 plus interest and attorney’s fees exceeding $400,000. A court ordered mediation was held in May 2020 without success. All material defendant motions have been denied by the court. The case issettled ~~set for jury trial~~ in ~~July~~October 2022. ~~We believe that Grand Traverse Holdings, LLC~~ and ~~John~~the ~~Gallegos~~Company ~~are jointly~~received ~~liable~~$122 ~~for~~thousand from the ~~asserted~~defendant, ~~damages~~ which ~~exceed~~amount $1was ~~million~~reported ~~plus~~as ~~attorney’s~~other ~~fees~~income ~~and~~in wethe ~~continue~~consolidated tofinancial ~~vigorously pursue our claims~~statements.

KBSIII Tower at Lake Carolyn, LLC and Prime US-Tower at at Lake Carolyn, LLC (collectively – “KBSIII”) v. Energy Hunter Resources, Inc.)

Plaintiff/Counterdefendant KBSIII was seeking lost rent on office space for periods after EHR vacated office premises located in Las Colinas, Texas. EHR filed a counter suit alleging specific damages due to uninhabitable premises of the office space due to the intolerable conduct of other tenants located on the same floor. On December 23, 2020, the trial court entered a summary judgment against EHR for $~~230,712~~231 thousand. The judgment provides ~~for~~ for post-judgment interest at a rate of 5% per annum until paid and further provides for additional amounts owed should EHR pursue unsuccessful appeals to higher courts. At December 31, ~~2021~~2022, the Company had accrued $~~252,583~~253 thousand for this judgment, which is exclusively an EHR obligation.

8Ogborn-Mihm, LLP v. ~~Income~~Evergreen Sustainable ~~Taxes~~Enterprises, Inc. (formerly Generation Hemp, Inc.), JDONE, LLC and Gary C. Evans

NoThe ~~amounts~~Company ~~were~~was ~~recorded~~recently ~~for~~made ~~income~~aware of ~~tax~~litigation ~~expense during~~filed against it in the ~~years~~District ~~ended~~Court ~~December~~of ~~31,~~Denver ~~2021~~from ora ~~2020.~~law Afirm ~~reconciliation~~which was previously engaged by the Company. While none of the ~~expected~~parties ~~statutory~~have ~~federal~~been ~~tax~~officially ~~and~~served, the ~~total~~alleged ~~income~~amount ~~tax~~being ~~expense~~ sought from ~~continuing~~the ~~operations~~Company ~~was~~is asless ~~follows:~~than $50,000.

	Year Ended December 31,
	2021			2020
Federal statutory rate	$	(2,056,480	)	$	(319,008	)
State income taxes, net		(198,940	)		(31,480	)
Change in valuation allowance		3,655,210			312,464
Change in state tax rates		(178,644	)		-
True-up of prior year deferred items		(929,450	)		-
Other, net		(291,696	)		38,024
Total income tax expense	$	-		$	-

9. Income Taxes

~~F-17~~No amounts were recorded for income tax expense during the years ended December 31, 2022 or 2021. A reconciliation of the expected statutory federal tax and the total income tax expense from continuing operations was as follows:

	Year Ended December 31,
	2022			2021
Federal statutory rate	$	(1,462,067	)	$	(2,056,480	)
State income taxes, net		(141,438	)		(198,940	)
Change in valuation allowance		1,630,110			3,655,210
Change in state tax rates		-			(178,644	)
True-up of prior year deferred items		-			(929,450	)
Other, net		(26,605	)		(291,696	)
Total income tax expense	$	-		$	-

The tax effect of temporary differences that gave rise to significant components of deferred tax assets and liabilities consisted of the following:

	December 31,
	2021			2020
	2022			2021
Assets:
Net operating loss carryforwards	$	45,~~960~~471,~~487~~098		$	24,~~200~~960,~~036~~487
Stock-based compensation		12,~~046~~142,~~464~~362			-1,046,464
Property and equipment		33(24,~~803~~310	)		2733,~~847~~803
Intangible assets		~~135~~216,~~012~~726			-135,012
Other		-			292,673
Subtotal		7,805,876			6,175,766
Subtotal		6,175,766			2,520,556
Valuation allowance		(7,805,876	)		(6,175,766	)
Valuation allowance		(6,175,766	)		(2,520,556	)
Net deferred tax asset	$	-		$	-

The Company has federal net operating loss (“NOL”) carryforwards of approximately $21.5 million at December 31, 2021, of which about $6.5 million begin to expire in 2034 and the remainder have no expiration.F-15

The Company has federal net operating loss (“NOL”) carryforwards of approximately $23.8 million at December 31, 2022, of which approximately $6.5 million begin to expire in 2034 and the remainder have no expiration. The Company estimates that a majority of its NOL carryforwards are subject to annual limitations under Internal Revenue Code Section 382 as a result of ownership changes at various times including in the Transaction. These NOL carryforwards may never be utilized by the Company.

9.The ~~Equity~~Company is delinquent in filing its 2021 Federal and state tax returns.

~~Change of Corporate Domicile – On August 21, 2021, the Company changed its domicile from the State of Colorado to the State of Delaware~~10. ~~The change of domicile had no effect on the number of outstanding securities of the Company. The Company is authorized for 200 million~~ ~~shares of capital stock, par value $0.00001 per share and 20 million shares of preferred stock, par value $0.00001 per share.~~Equity

Series A Preferred Stock – Our Series A Preferred Stock was originally issued in connection with ~~the~~HTF’s ~~Transaction~~acquisition ~~completed~~of EHR in ~~December~~ 2019. On September 8, 2021, ~~holders~~ holders of the Company’s Series A Preferred Stock elected to convert such shares into shares of the Company’s common stock. As a result, 6,328,948 shares of Series A Preferred Stock were converted into 75,947,376 shares of common stock, with each share of Series A Preferred Stock converting into 12 shares of restricted common stock pursuant to the applicable Certificate of Designations.

Series B Preferred ~~Stock~~ Stock Units – On December 30, 2020, the Company sold to certain accredited investors, including Gary C. Evans, our Chief Executive Officer, an aggregate of 135 preferred stock units comprised of (i) one share of Series B Redeemable Convertible Preferred Stock, no par value, and (ii) one warrant exercisable for 50~~,000~~ thousand shares of common stock of the Company until December 30, 2022 at an exercise price of $0.352 per share.

The sale of the preferred stock units for $10~~,000~~ thousand each resulted in aggregate gross proceeds of approximately $1.35 million, before deducting estimated offering expenses payable by the Company. Substantially all of the proceeds raised in the offering were used to fund the acquisition of assets of Halcyon, expenses related thereto and for general corporate purposes.

FEach share of Series B Preferred Stock is initially convertible into 25,000 shares of common stock, subject to adjustment. Holders of Series B Preferred Stock are entitled to receive dividends of 6.00% per annum based on the stated value equal to $10 thousand per share. Except as otherwise required by law, the Series B Preferred Stock does not have voting rights. However, as long as any shares of Series B Preferred Stock are outstanding, the Company will not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series B Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series B Preferred Stock, (b) alter or amend the related certificate of designation, (c) amend its certificate of incorporation or other charter documents in any manner that adversely affects any rights of the holders of Series B Preferred Stock, (d) repay, repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis number of shares of its common stock, (e) enter into any agreement with respect to any of the foregoing, or (f) pay cash dividends or distributions on any equity securities of the Company other than pursuant to the terms of the outstanding Series B Preferred Stock. The Series B Preferred Stock does not have a preference upon any liquidation, dissolution or winding-18up of the Company.

Each share of Series B Preferred Stock is initially convertible into 25,000 shares of common stock, subject to adjustment. Holders of Series B Preferred Stock are entitled to receive dividends of 6.00% per annum based on the stated value equal to $10,000 per share. Except as otherwise required by law, the Series B Preferred Stock does not have voting rights. However, as long as any shares of Series B Preferred Stock are outstanding, the Company will not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series B Preferred Stock, (a) alter or change adversely the powers, preferences or rights given to the Series B Preferred Stock, (b) alter or amend the related certificate of designation, (c) amend its certificate of incorporation or other charter documents in any manner that adversely affects any rights of the holders of Series B Preferred Stock, (d) repay, repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis number of shares of its common stock, (e) enter into any agreement with respect to any of the foregoing, or (f) pay cash dividends or distributions on any equity securities of the Company other than pursuant to the terms of the outstanding Series B Preferred Stock. The Series B Preferred Stock does not have a preference upon any liquidation, dissolution or winding-up of the Company.

Any or all of the Series B Preferred Stock may be converted, at their holder’s option, into 25,000 shares of common stock, as adjusted for any stock dividends, splits, combinations or similar events.

At any time after the ~~occurrence~~ occurrence of a “Qualifying Event,” the Company, upon 5-day written notice, shall have the right to cause each share of Series B Preferred Stock (and all accrued in-kind dividends with respect thereto) to be converted into common stock. For purposes of this automatic ~~conversion~~ conversion of the Series B Preferred Stock, a “Qualifying Event” shall have occurred if (A) (1) the rolling five-trading day volume-weighted average trading price of shares of the common stock exceeds $1.00, and (2) there shall be an effective registration statement under the Securities Act of 1933, as amended covering all of the shares of common stock which would be issuable upon conversion of all of the outstanding shares of Series B Preferred Stock or (B) the Company closes a firm commitment underwriting of the common stock on a Form S-1 Registration Statement with aggregate gross proceeds of at least $5~~,000,000~~ million at a price per share equal to or greater than $1.00. In each instance, a conversion may not be made unless the Company has filed an amendment to its Articles of Incorporation effecting an increase in its authorized common stock so that the Company has a sufficient number of authorized and unissued shares of common stock so as to permit the conversion of all outstanding shares.

The Series B Preferred Stock may be redeemed by the Company for its stated value, plus accrued and unpaid dividends, at any time. Initially, redemption payments of 12.5% each of the total amount of Series B Preferred Stock then outstanding plus accrued dividends were due from the Company to each Holder of Series B Preferred Stock at the end of each calendar quarter of 2021. The first required redemption payments totaling $137,500 were made in April 2021. In May, June and October of 2021, the three holders of the Series B Preferred Stock, including the Company’s chief executive officer, entered into transactions in which they accepted the mandatory redemption payment required pursuant to the Series B Preferred Stock certificate of designation in a number of Series B Units to effectively waive the redemption requirement. All other terms of the Series B Units remain unchanged and the holders’ ownership interest in the Series B Preferred Units remains the same as it was before such transactions.F-16

~~Common~~The Series B Preferred Stock –may be redeemed by the Company for its stated value, plus accrued and unpaid dividends, at any time. Initially, redemption payments Atof ~~December~~12.5% 31each of the total amount of Series B Preferred Stock then outstanding plus accrued dividends were due from the Company to each Holder of Series B Preferred Stock at the end of each calendar quarter of 2021. The first required redemption payments totaling $137 thousand were made in April 2021. In May, June and October of 2021, the three holders of the Series B Preferred Stock, including the Company’s chief ~~had~~executive ~~113~~officer,~~094,002~~ ~~common~~entered ~~shares~~into ~~outstanding.~~transactions ~~Following~~in iswhich they accepted the mandatory redemption payment required pursuant to the Series B Preferred Stock certificate of designation in a ~~discussion~~number of ~~common~~Series ~~stock~~B ~~issuances~~Units ~~during~~to effectively waive the redemption requirement. All other terms of the ~~periods~~Series ~~presented:~~B Units remain unchanged and the holders’ ownership interest in the Series B Preferred Units remains the same as it was before such transactions.

~~● February 2020 Issuance of~~ Common Stock ~~Units~~ – At InDecember ~~February~~31, ~~2020~~2022, the Company ~~issued~~had ~~250~~113,~~000~~204,002 common ~~units~~shares ~~for $100,000~~outstanding. ~~Each~~Following ~~unit~~is ~~consisted~~a ofdiscussion ~~one share~~ of common stock ~~and~~issuances aduring the ~~warrant~~periods ~~for purchase of one common share for $0.40 per share. The warrant expired March 1, 2022. Proceeds of this issuance were used for general corporate purposes.~~presented:

~~The~~● Acquisition of Certain Assets of Halcyon – In January 2021, the Company issued 6,250,000 shares of common stock ~~issued~~valued at $2.5 million ($0.40 per share; restricted from trading for a period of up to one year) in the ~~exchange was~~acquisition. ~~valued~~● ~~using~~2021 First Quarter Issuances of Common Stock Units – In the ~~trading~~first ~~price~~quarter of 2021, the Company issued 800,000 common stock onunits ~~February~~for ~~20,~~total ~~2020~~proceeds of $400,000. ~~The~~Each ~~warrants~~common ~~were~~stock ~~valued~~unit atconsisted ~~$45,848~~of ~~using~~one share of common stock and a ~~binomial~~warrant ~~lattice valuation~~for ~~model~~the ~~using~~purchase ~~inputs~~of astwo shares of common stock for $0.50 each. Each warrant is exercisable any time before its expiration on the ~~exchange~~second ~~date~~anniversary of its issuance. ~~Our~~The ~~expected~~Company ~~volatility~~allocated ~~assumption~~the ~~was~~total proceeds based on the ~~historical~~relative ~~volatility~~fair values of the ~~Company’s~~ common stock ~~(252%)~~and warrants. The ~~expected~~fair ~~life~~value ~~assumption~~of the warrants was ~~based~~determined onusing ~~the~~an ~~expiration~~options ~~date~~valuation ofmodel ~~the~~with ~~warrant~~key ~~(two~~assumptions ~~years).~~including ~~The~~a risk-free interest rate of 0.11% and historical volatility of 272%. A total of $263 thousand was allocated to the warrants and reported in additional paid-in capital. ● Warrant Exercises – In the first quarter of 2021, the Company received approximately $3 million for the ~~expected~~exercise ~~term~~of 8,428,976 outstanding warrants. In the fourth quarter of 2021, the ~~warrant~~Company ~~was~~received ~~based~~$375 onthousand for the Uexercise of 1,065,340 outstanding warrants.S. ~~Treasury~~● ~~yield~~Issuances ~~curve~~for Exchange or Conversion of Debt – The Company issued a total of 1,618,660 common shares for the exchange or conversion of outstanding indebtedness totaling $2.2 million in ~~effect~~the atfirst quarter of 2021. ● Issuance to Vendor for Services – In the ~~time~~third quarter of ~~measurement~~2021, (1the Company issued 125,000 common shares valued at $117.~~39%)~~5 thousand to a vendor for services performed. ● Issuance for Extension of Secured Note – The ~~warrants~~Company ~~are~~issued ~~classified~~20,000 ~~within~~common ~~equity~~shares valued at $18 thousand as consideration to extend the maturity of a senior note in the ~~consolidated~~third ~~balance~~quarter ~~sheets~~of 2021. ~~Under~~● ~~GAAP~~Issuance for Conversion of Series A Preferred Stock – As noted above, in the ~~anti-dilution~~third ~~provisions~~quarter ~~will~~of be2021, ~~accounted~~ the Company issued 75,947,376 common shares for ifthe conversion of all outstanding shares of its Series A Preferred Stock. ● 2021 Fourth Quarter Issuances of Common Stock Units – In the fourth quarter of 2021, the Company issued 958,333 common stock units to accredited investors for total proceeds of $575 thousand. Each common stock unit consists of one share of common stock and ~~when~~a ~~these~~warrant ~~provisions~~for ~~are~~the ~~triggered~~purchase of one share of common stock for $0.60 each. Each warrant is exercisable any time before its expiration on the second anniversary of its issuance. The Company allocated the total proceeds based on the relative fair values of the common stock and warrants. The fair value of the warrants was determined using an options valuation model with key assumptions including risk-free interest rates ranging from 0.48% to 0.70% and historical volatility ranging from 237% to 258%. A total of $277 thousand was allocated to the warrants and reported in additional paid-in capital.. ● Issuance for Extensions of Secured Note – The Company issued 110,000 common shares valued at $52.6 thousand as consideration for extensions of the maturity of a senior note in 2022. Refer to Note 5.

F-1917

●Common ~~Acquisition~~Stock ofWarrants ~~Certain~~Outstanding ~~Assets of Halcyon~~ – InFollowing is ~~January~~a ~~2021,~~summary ~~the Company issued 6,250,000 shares~~ of ~~common~~warrants ~~stock~~outstanding ~~valued~~as ~~at $2.5 million ($0.40 per share; restricted from trading for a period~~ of upDecember to31, ~~one year) in the acquisition. Refer to Note 3.~~2022:

● 2021 First Quarter Issuances of Common Stock Units – In the first quarter of 2021, the Company issued 800,000 common stock units for total proceeds of $400,000. Each common stock unit consists of one share of common stock and a warrant for the purchase of two shares of common stock for $0.50 each. Each warrant is exercisable any time before its expiration on the second anniversary of its issuance. The Company allocated the total proceeds based on the relative fair values of the common stock and warrants. The fair value of the warrants was determined using an options valuation model with key assumptions including a risk-free interest rate of 0.11% and historical volatility of 272%. A total of $263,293 was allocated to the warrants and reported in additional paid-in capital.

	# of Warrants		Price (each)		Expiration Date	Method of Exercise
Issued in December 2020 with subordinated note to investor ⁽¹⁾		500,000	$	0.352	December 30, 2023	Cash
Issued in Q1 2021 with common stock units ⁽¹⁾		1,600,000	$	0.500	January-February, 2023	Cash
Issued in Q4 2021 with common stock units ⁽¹⁾		958,333	$	0.600	October-December, 2023	Cash
Total warrants outstanding at December 31, 2022		3,058,333

● Warrant Exercises – In the first quarter of 2021, the Company received $2,967,000 for the exercise of 8,428,976 outstanding warrants. In the fourth quarter of 2021, the Company received $375,000 for the exercise of 1,065,340 outstanding warrants.

● Issuances for Exchange or Conversion of Debt – The Company issued a total of 1,618,660 common shares for the exchange or conversion of outstanding debt. Refer to Note 5.

● Issuance to Vendor for Services – In the third quarter of 2021, the Company issued 125,000 common shares to a vendor for services performed.

● Issuance for Extension of Secured Note – The Company issued 20,000 common shares as consideration to extend the maturity of a senior note in the third quarter of 2021. Refer to Note 5.

● Issuance for Conversion of Series A Preferred Stock – As noted above, in the third quarter of 2021, the Company issued 75,947,376 common shares for the conversion of all outstanding shares of its Series A Preferred Stock.

	●	2021 Fourth Quarter Issuances of Common Stock Units – In the fourth quarter of 2021, the Company issued 958,333 common stock units to accredited investors for total proceeds of $575,000. Each common stock unit consists of one share of common stock and a warrant for the purchase of one share of common stock for $0.60 each. Each warrant is exercisable any time before its expiration on the second anniversary of its issuance. The Company allocated the total proceeds based on the relative fair values of the common stock and warrants. The fair value of the warrants was determined using an options valuation model with key assumptions including risk-free interest rates ranging from 0.48% to 0.70% and historical volatility ranging from 237% to 258%. A total of $276,947 was allocated to the warrants and reported in additional paid-in capital.
	●	Stock-based Compensation – The Company issued 500,000 restricted common shares valued at $155,000 as incentive compensation to two executives who joined the Company in the first quarter of 2021.

F-20

Common Stock Warrants Outstanding – Following is a summary of warrants outstanding as of December 31, 2021:

	# of Warrants		Exercise Price (each)		Expiration Date	Method of Exercise
Issued in February 2020 with common stock units (2)		250,000	$	0.400	March 1, 2022		Cash
Issued in December 2020 with Series B preferred units (1)		5,500,000	$	0.352	December 30, 2022		Cash
Issued in December 2020 with subordinated note to investor (1)		500,000	$	0.352	December 30, 2022		Cash
Issued in Q1 2021 with common stock units (1)		1,600,000	$	0.500	January-February, 2023		Cash
Issued in Q4 2021 with common stock units (1)		958,333	$	0.600	Oct-Dec, 2023		Cash
Total warrants outstanding at December 31, 2021		8,808,333

⁽¹⁾

May be redeemed for $0.0001 per warrant at the Company’s option with 30 days advanced notice should the weighted average market price of common stock exceed $1.00 for any five out of seven consecutive trading days with a minimum average daily trading volume for such seven-day period of at least 25,000 shares of common stock.

(2) Contains certain anti-dilution provisions requiring a downward adjustment to the exercise price of the warrant if dilutive instruments are issued at prices less than the warrant exercise price.

Following is a summary of outstanding stock warrants activity for the periods presented:

				Weighted
	# of Warrants			Weighted Average Price
				Average
Warrants as of January 1, 2021		22,988,632		$	0.353
	# of Warrants			Exercise Price
Warrants as of January 1, 2020		14,488,638		$	0.353
Issued		8,499,994		$	0.353
Warrants as of December 31, 2020		22,988,632		$	0.353
Issued		2,558,333		$	0.537
Cancelled		(7,244,316	)	$	0.352
Exercised		(9,494,316	)	$	0.352
Warrants as of December 31, 2021		8,808,333		$	0.407
Canceled		(5,750,000	)	$	0.354
Warrants as of December 31, 2022		3,058,333		$	0.507

F11. Stock-21Based Compensation

10We award restricted stock or stock options as incentive compensation to employees and compensation to our Board of Directors for services. Generally, these awards include vesting periods of up to three ~~Stock-Based~~years ~~Compensation~~from the date of grant.

WeThe ~~award~~2021 ~~restricted~~Omnibus ~~stock~~Incentive orPlan ~~stock~~(“2021 ~~options~~Plan”) aswas ~~incentive~~adopted ~~compensation~~by toour ~~employees~~Board on July 1, 2021. ~~Generally~~The 2021 Plan provides for the initial reservation of 15 million shares of common stock for issuance, ~~these~~and ~~awards~~provides ~~include~~that ~~vesting~~the ~~periods~~maximum number of upshares that may be issued pursuant to ~~three years~~the ~~from~~exercise of ISOs is 15 million. On the one-year anniversary date of ~~grant~~the 2021 Plan, the number of shares of common stock reserved for issuance automatically increased to 20% of the fully diluted common shares outstanding, including shares issuable upon the conversion of preferred shares, as calculated on an as-converted basis.

~~The~~In ~~2021 Omnibus Incentive Plan (“2021 Plan”) was adopted by our Board on July 1, 2021. The 2021 Plan provides for~~ the ~~initial~~first ~~reservation of 15 million~~quarter ~~shares~~ of ~~common stock for issuance~~2021, ~~and provides that~~ the ~~maximum~~Company ~~number of shares that may be~~ issued ~~pursuant~~500,000 torestricted ~~the exercise of ISOs is 15 million. The number of~~ shares ofvalued ~~common~~at ~~stock~~$155 ~~available~~thousand ~~for issuance under the 2021 Plan constituted approximately 13.1% of the Company’s fully diluted common shares outstanding~~ as ofincentive ~~the~~compensation ~~date~~to oftwo ~~Board~~executives ~~approval,~~who ~~including~~joined ~~shares issuable upon~~ the ~~conversion~~ ~~of preferred shares, as calculated on an as-converted basis~~Company. OnCompensation ~~the~~expense ~~one-year~~related ~~anniversary~~to ~~date~~these ofawards ~~the~~totaled ~~2021~~$155 ~~Plan,~~thousand ~~the number of shares of common stock reserved~~ for ~~issuance~~2021. ~~thereunder~~These ~~shall~~awards ~~automatically~~became ~~increase to 20% of the~~ fully ~~diluted~~vested ~~common~~in ~~shares~~January ~~outstanding, including shares issuable upon the conversion of preferred shares, as calculated on an as-converted basis~~2022.

In the ~~first~~fourth quarter of of 2021, the Company ~~issued~~awarded ~~500~~options for 13,850,000 ~~restricted~~ shares ~~valued~~of atthe ~~$155,000~~Company’s common stock as incentive compensation to management and the Board of Directors. One-third of the awarded options vested immediately with the remaining options vesting in two ~~executives~~equal ~~who~~annual tranches ~~joined~~over the ~~Company~~next two years. ~~The~~ ~~awards~~Vested ~~vest~~options may be exercised at any time until their expiration after ~~one~~10 ~~year~~years at an exercise price of $0.76 per share. Unvested options are forfeited upon termination of service. ~~Compensation~~The ~~expense~~fair ~~related~~value toof ~~these~~the awards ~~totaled~~at the date of grant of $~~155~~10.5 million was determined using the Black-Scholes option pricing model. Key assumptions included a risk-free interest rate ranging from 1.18% to 1.28%,~~000~~ ~~for~~historical ~~2021~~volatility ranging from 331% to 643% and an expected life of the stock options ranging from five to six years.

In the ~~fourth~~third quarter of ~~2021~~of 2022, the Company awarded options for 131,~~850~~915,000 shares of the Company’s common stock as incentive compensation. ~~One-third~~to ofits ~~the~~CEO and ~~awarded~~board ~~options~~of ~~vested~~directors. ~~immediately~~The ~~with~~awarded ~~the remaining~~ options ~~vesting~~vest ~~in two equal annual tranches~~ over the next ~~two~~three years. Vested options may be exercised at any time until their expiration ranging ~~after~~from eight to 10 years at antheir exercise ~~price~~prices ofranging from $0.7630 to $0.33 per share. Unvested options are forfeited upon termination of service. The fair value of ~~employment~~the awards at the date of grant of $576 thousand was determined using the Black-Scholes option pricing model. Key assumptions included a risk-free interest rate ranging from 2.87% to 3.03%, historical volatility ranging from 251% to 408% and an expected life of the stock options ranging from four to seven years.

~~Compensation~~We ~~expense for stock option grants was~~ recognized ~~based on the fair value at the date of grant using the Black-Scholes option pricing model~~$4.7 ~~Key assumptions~~million ~~included~~of acompensation ~~risk-free~~expense ~~interest~~in ~~rate~~2022 ~~ranging from 1.18% to 1.28%, historical volatility ranging from 331% to 643%~~ and ~~an expected life of the stock options ranging from five to six years. We recognized~~ $41.4 million ofin ~~compensation~~2021 ~~expense~~ for option awards ~~in 2021~~. As of December 31, ~~2021~~2022, there was $62.10 million of total unrecognized compensation cost related to options to be recognized over a remaining weighted average period of 2417 months.

F-18

The following table summarizes options outstanding, as well as activity for the periods presented:

	Number of Options		Weighted Average Grant Date Fair Value		Weighted Average Exercise Price		Aggregate Intrinsic Value
	Shares		Weighted Average Grant Date Fair Value		Weighted Average Exercise Price		Aggregate Intrinsic Value
Outstanding at January 1, 2021		-	$	-	$	-		-
Granted		13,850,000	$	0.76	$	0.76		-
Outstanding at December 31, 2021		13,850,000	$	0.76	$	0.76		-
Granted		1,915,000	$	0.30	$	0.31		-
Outstanding at December 31, 2022		15,765,000	$	0.70	$	0.71		-

The remaining weighted average contractual life of exercisable options at December 31, ~~2021~~2022 was ~~9.8~~nine years.

~~F-22~~12. Discontinued Operations

11In 2019, management determined to fully divest of EHR’s oil and gas activities. ~~Discontinued~~As ~~Operations~~such, these activities are presented as discontinued operations for each of the periods presented. The following is a summary of the carrying amounts of major classes of assets and liabilities of the discontinued operations to assets and liabilities held for sale:

The following is a summary of the carrying amounts of major classes of assets and liabilities of the discontinued operations to assets and liabilities held for sale:

	December 31,
	2022			2021
Assets:
Oil and natural gas properties held for sale, at cost	$	1,874,849		$	1,874,849
Accumulated DD&A		(1,874,849	)		(1,874,849	)
Total assets of discontinued operations held for sale	$	-		$	-

Liabilities:
Accrued liabilities	$	61,701		$	48,997
Asset retirement obligations		52,368			52,368
Revenue payable		52,117			52,117
Current liabilities of discontinued operations held for sale		166,186			153,482
Asset retirement obligations -
Long-term liabilities of discontinued operations held for sale		207,197			162,948
Total liabilities of discontinued operations held for sale	$	373,383		$	316,430

	December 31,
	2021			2020
Assets -
Oil and natural gas properties held for sale, at cost	$	1,874,849		$	1,874,849
Accumulated DD&A		(1,874,849	)		(1,874,849	)
Total assets of discontinued operations held for sale	$	-		$	-
Liabilities
Accrued liabilities	$	48,997		$	31,117
Asset retirement obligations		52,368			56,834
Revenue payable		52,117			52,117
Current liabilities of discontinued operations held for sale		153,482			140,068
Asset retirement obligations -
Long-term liabilities of discontinued operations held for sale		162,948			144,149
Total liabilities of discontinued operations held for sale	$	316,430		$	284,217

The following is a summary of the major classes of line items constituting loss on discontinued operations shown in the consolidated statements of operations:

	For the year ended December 31,
	2021			2020
	2022			2021
Revenue -
Oil and gas sales	$	~~116~~147,~~710~~828		$	~~103~~116,~~097~~710
Costs and Expenses
Costs and Expenses:
Lease operating expense		~~134~~163,~~590~~352			93134,~~709~~590
Depreciation, depletion & amortization		-			9,942
Accretion of asset retirement obligations		44,249			14,333
Accretion		14,333			34,796
Total costs and expenses		207,601			148,923
Gain on disposal of oil & gas property interests		-			(24,008	)
Loss from discontinued operations	$	(59,773	)	$	(32,213	)
Total costs and expenses		148,923			114,439
Interest expense		-			22,917
Loss from discontinued operations	$	(32,213	)	$	(34,259	)

F-2319

1213. Supplemental Cash Flow Information

	For the year ended December 31,
	2021		2020
	2022		2021
Cash paid for interest	$	~~138~~68,~~736~~321	$	-138,736
Cash paid for taxes		-		-
Noncash investing and financing activities:
Acquisition of certain assets of Halcyon Thruput, LLC
- issuance of common shares		~~2,500,000~~-		-2,500,000
- issuance of subordinated note		~~850,000~~-		-850,000
- assumption of Halcyon bank note		~~995,614~~-		-995,614
Series B preferred stock dividend payable		5880,~~312~~002		-58,312
Issuance of common stock units previously subscribed		~~50,000~~-		-50,000
Issuances of common shares for exchange or conversion of debt		~~2,160,269~~-		-2,160,269
Conversion of Series A preferred stock into common stock		~~4,975,503~~-		-4,975,503

1314. Earnings (Loss) per Share

The following ~~table~~ is athe ~~calculation~~computation of ~~the~~ earnings (loss) per basic and diluted share:

	For the year ended December 31,
	2021			2020
	2022			2021
Amounts attributable to Generation Hemp:
Numerator
Loss from continuing operations attributable to common stockholders	$	(96,~~792~~975,~~532~~740	)	$	(19,~~466~~792,~~555~~532	)
Loss from discontinued operations		(30,196	)		(32,114	)
Income (loss) from discontinued operations		(56,031	)		(30,196	)
Less: preferred stock dividends		(7480,~~812~~002	)		-(74,812	)
Net loss attributable to common stockholders	$	(97,~~897~~111,~~540~~773	)	$	(19,~~498~~897,~~669~~540	)
Denominator
Weighted average shares used to compute basic EPS		57113,~~159~~163,~~659~~591			1757,~~346~~159,~~164~~659
Dilutive effect of convertible note		1,164,773			1,164,773
Dilutive effect of preferred stock		552,~~075~~950,~~900~~000			7555,~~965~~075,~~819~~900
Dilutive effect of common stock options		~~709~~229,~~981~~762			-709,981
Dilutive effect of common stock warrants		111,~~022~~320,~~542~~951			1411,~~686~~022,~~725~~542
Weighted average shares used to compute diluted EPS		~~125~~118,~~132~~829,~~854~~077			~~109~~125,~~163~~132,~~481~~855
Earnings (loss) per share:
Loss from continuing operations
Basic	$	(0.1706	)	$	(0.0817	)
Diluted	$	(0.1706	)	$	(0.0817	)
(Loss) income from discontinued operations
Loss from discontinued operations
Basic	$	-		$	-
Diluted	$	-		$	-
Earnings (loss) per share
Basic	$	(0.1706	)	$	(0.0917	)
Diluted	$	(0.1706	)	$	(0.0917	)

F-24

The computation of diluted earnings per common share excludes the assumed conversion of the Series B Preferred Stock and outstanding convertible notes and exercise of common stock options and warrants in periods when we report a loss. The dilutive effect of the assumed exercise of outstanding options and warrants was calculated using the treasury stock method.

1415. Subsequent Events

~~Advances~~Issuance ~~under~~of ~~Promissory Note~~common –stock options – In ~~the~~January ~~first quarter of 2022~~2023, ~~Investment~~the ~~Hunter,~~Company ~~LLC,~~issued aoptions ~~Texas~~for ~~LLC~~the ~~controlled~~purchase byof ~~our CEO~~100,000 ~~made~~shares ~~advances~~of ~~totaling~~common ~~$449,000 to the~~stock ~~Company~~each ~~under~~to aour ~~promissory~~three ~~note~~directors ~~due~~as ~~June~~board ~~30,~~fees for ~~2022~~the year. IfThe ~~the~~exercise ~~Company~~price ~~raises~~of ~~new~~the ~~equity~~options ~~capital~~is of $30.30 ~~million~~and orthey ~~more,~~have ~~then~~a ~~the~~ten ~~full~~year ~~amount outstanding~~term. ~~under~~One-third of the ~~note~~options isvested ~~due~~immediately. ~~within~~The remaining ~~five~~options ~~days.~~vest ~~The~~in ~~note~~equal ~~bears~~tranches ~~interest~~over atthe ~~10%~~next ~~per~~two ~~annum~~years.

~~Joint~~F-Venture With Crypt Solutions, Inc. – On January 16, 2022, the Company and Crypt Solutions, Inc., DBA Cryptech Solutions (“Crypt”) a leading player in the cryptocurrency space, executed a Memorandum of Understanding and Letter of Intent to build “Green Energy” plants and Bitcoin mining complexes that will utilize hemp feedstock as a fuel source to power Bitcoin mining equipment and offset the draw on power from the local utility.20

OnCommencement ~~February~~of ~~23,~~Bitcoin ~~2022,~~Operations ~~the Company~~ and ~~Crypt executed the first Letter~~ Acquisition of ~~Intent~~Toro ~~that~~Energía ~~specifically~~Sociedad ~~applies~~Anonima to– ~~their~~In ~~joint~~January ~~Green Energy project~~2023, ~~to be located adjacent to~~ the Company’s ~~current~~announced ~~hemp~~a ~~processing~~new ~~facility~~strategic indirection ~~Hopkinsville,~~into ~~Kentucky. This first project is being designed for two (2) megawatts~~sustainable ofenergy ~~Bitcoin mining~~projects, ~~which~~starting ~~will~~with ~~include~~bitcoin ~~approximately 576~~ mining ~~machines~~. The ~~Bitcoin~~Company’s ~~mining~~name ~~installation~~was ischanged ~~expected~~ to beEvergreen ~~running~~Sustainable ~~prior to~~Enterprises, ~~the~~Inc. ~~end~~(“EGSE”) in ofMarch ~~the second quarter 2022~~2023. ~~Initial~~The ~~electricity~~Company’s ~~needs~~existing ~~for~~operations ~~the project~~ will ~~come~~continue ~~from~~to ~~the~~be ~~grid~~maintained ~~or the existing electricity provider until such time~~ as ~~biomass~~a orfully ~~other~~operating ~~renewable~~wholly-owned ~~methods are installed~~subsidiary.

~~Amendment of Real Estate Purchase Option -~~ On ~~March~~January 259, ~~2022~~2023, the Company’s ~~option~~purchased ~~that~~80% of ~~expired~~Toro ~~January~~Energía 11Sociedad Anonima (“Toro”), ~~2022~~a toCosta ~~purchase~~Rican ~~the~~corporation ~~operating~~with ~~facility~~ownership inof ~~Kentucky it~~a ~~leases~~hydroelectric ~~from~~dam Ozin ~~Capital,~~Costa Rica. ~~LLC~~The ~~for~~source ~~$993,000~~of ~~was~~approximately ~~amended~~one ~~and~~megawatt ~~extended.~~of Aspower ~~amended,~~produced from the ~~Company~~hydroelectric ~~may~~dam ~~purchase~~(six ~~the~~generators) ~~facility~~will onbe orused ~~before~~to power new ~~June~~Bitcoin ~~30,~~mining ~~2022~~machines ~~for~~at aan ~~purchase~~extremely ~~price~~low cost. The transaction included seller-financed debt of $~~1,293,000~~985 thousand. The ~~amended~~seller-financed debt ~~agreement~~has ~~also~~a ~~required~~term ~~the~~of ~~Company~~10 toyears ~~pay~~and ~~all~~a ~~past~~9.5% ~~due~~per ~~obligations~~annum ~~related to~~variable interest rate (based on the ~~facility,~~prime ~~including~~rate) ~~rent,~~with ~~totaling~~straight ~~approximately~~line ~~$46,000~~amortization. ~~This~~The seller-financed ~~payment~~debt ~~was~~is ~~made~~secured inby ~~April~~pledge ~~2022~~of the Toro Dam.

The purchase price for 80% of Toro’s equity was $1.4 million. These amounts were paid in cash from proceeds of a Secured Promissory Note (“Secured Note”) with the Gary C. Evans, CEO of the Company (‘Evans”). Under the terms of the Secured Note, (a) the Company and Evans restructured (i) the Subordinated Promissory Note dated November 20, 2020 and (ii) Convertible Promissory Note dated July 20, 2021, such that all accrued and unpaid interest on each note were rolled into a new Secured Note, (b) Evans lent the Company $500 thousand on January 9, 2023 and $969 thousand on January 10, 2023. The Secured Note has a maturity date of July 15, 2023 and bears interest at the rate of 10.00% per annum. The Secured Note has a conversion feature which permits Evans to convert at the Maturity Date then outstanding principal and interest at a conversion price of $0.275 (the closing price of the Company’s stock on January 9, 2023).

The Toro Dam is located approximately 25 miles from San Jose between two volcano craters. The site generates all its energy from green resources with a proven 98% run time over the years and has a full-time staff in place under a new Operating & Maintenance Agreement.

Hydroelectric power is a clean and renewable energy source that is used to generate electricity by harnessing the energy of falling water and can provide a reliable and a very cost-effective source of energy for bitcoin mining operations. Hydroelectric power can help reduce the carbon footprint of cryptocurrency mining, as many cryptocurrencies are produced using fossil fuels, which continues to contribute to greenhouse gas emissions and climate change. By using hydroelectric power, bitcoin mining can be made more environmentally friendly and sustainable and can help improve the stability and reliability of cryptocurrency networks. Hydroelectric power is a relatively stable and reliable source of energy, compared to other sources such as coal or fossil fuels, which can be prone to price fluctuations and supply disruptions. The Company has committed to acquire 240 new Bitmain S19J Pro+ ASIC miners that will be deployed at the Toro Dam in the first half of 2023.

Subordinated Promissory Note and Warrants to Investor – As discussed in Note 5, on March 1, 2023, the Company paid $240 thousand in full repayment of this note and accrued interest thereon.

Hemp Processing Operating Facility – The Company’s lease of its operating facility in Kentucky from Oz Capital, LLC, a related party, was amended in January 2023. As amended, the lease payment was increased to $20.5 thousand monthly beginning in March 2023. The lease expiration date of May 31, 2024 was not changed.

Issuance of Series C Preferred Units – In the first quarter of 2023, the Company issued six Series C Preferred Units in a private placement for total proceeds of $300 thousand. Each unit consists of one share of 8.50% Series C Redeemable Convertible Preferred Stock and 5,000 warrants to acquire one share of common stock. Cumulative dividends at 8.5% of the stated value of the Series C Redeemable Convertible Preferred Stock are payable each calendar quarter end in cash or additional shares of Series C Redeemable Convertible Preferred Stock, at the Company’s option.

Each share of Series C Redeemable Convertible Preferred Stock is convertible, at the holder’s option, into 100 thousand shares of our common stock at any time. It is subject to automatic conversion if (a) the rolling five (5)-trading day volume-weighted average trading price of shares of our common stock exceeds $0.75 and (b) there shall be an effective registration statement under the Securities Act of 1933. The conversion ratio may be adjusted for certain dilutive issuances or in the event a dividend is paid on our common stock. The Series C Redeemable Convertible Preferred Stock is redeemable at any time at the Company’s option.

The warrants are exercisable for a cash exercise price of $0.50 per share and expire in three years. The warrants may be redeemed at the Company’s option if after one year from issuance, the trading price of the Company’s common stock exceeds $0.875 over a ten consecutive day trading period having a minimum trading volume of 25 thousand shares daily.

Promissory Note to Investment Hunter, LLC – In the first quarter of 2023, Investment Hunter, LLC, a Texas LLC controlled by our CEO, made advances totaling $300 thousand to the Company.

Secured Promissory Note to a Director and our CEO – On April 19, 2023, Razorback I, LLC, a wholly-owned subsidiary of the Company, borrowed $300 thousand under a secured promissory note from one of our directors and our CEO. Proceeds from the note are expected to be utilized in the acquisition of land in Arkansas to expand bitcoin mining operations.

The promissory note matures on April 15, 2024. Interest accrues at 12% per annum and is due quarterly beginning on July 15, 2023. The holders have the option to convert the outstanding principal and interest into restricted shares at a conversion price of $0.30 per share of common stock.

The secured promissory note is collateralized by a pledge of 100% of the ownership interest of Razorback I, LLC and has been guaranteed by the Company as well.

* * * * *

F-2521

Supplemental Oil and Gas Information

(Unaudited)

Oil and Gas Reserve Information. Proved oil and gas reserves are those quantities of crude oil, natural gas, condensate, and NGLs, which by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible from a given date forward, from known reservoirs, and under existing economic conditions, operating methods, and government regulations. Estimated proved developed oil and gas reserves can be expected to be recovered through existing wells with existing equipment and operating methods. The Company reports all estimated proved reserves held under production-sharing arrangements utilizing the “economic interest” method.

Proved oil and gas reserves have been estimated by independent, third-party petroleum engineers, Mire & Associates, Inc. These reserve estimates have been prepared in compliance with the Securities and Exchange Commission rules and accounting standards based on the 12-month unweighted first-day-of-the-month average price for the year.

There are numerous uncertainties inherent in estimating quantities of proved reserves and projecting future rates of production and timing of development expenditures. The reserve data in the following tables only represent estimates and should not be construed as being exact.

The following reserves schedule sets forth the changes in estimated quantities of proved crude oil reserves:

	Crude Oil (Bbls)			Natural Gas (mcf)			Total (Boe)
Total proved reserves:
Balance at December 31, 2019		178,440			604,590			279,205
Revisions of previous estimates		(12,900	)		(8,520	)		(14,320	)
Divestiture of Reserves		(140,541	)		(576,051	)		(236,549	)
Production		(5,439	)		(6,169	)		(6,468	)
Balance at December 31, 2020		19,560			13,850			21,868
Revisions of previous estimates		(10,895	)		(13,247	)		(13,102	)
Production		(1,675	)		(603	)		(1,776	)
Balance at December 31, 2021		6,990			-			6,990
Revisions of previous estimates		178			47			225
Production		(1,508	)		(47	)		(1,555	)
Balance at December 31, 2022		5,660			-			5,660
Proved developed reserves as of:
December 31, 2019		30,420			132,800			52,553
December 31, 2020		2,660			-			2,660
December 31, 2021		6,990			-			6,990
December 31, 2022		5,660			-			5,660
Proved undeveloped reserves as of:
December 31, 2019		148,020			471,790			226,652
December 31, 2020		16,900			13,850			19,208
December 31, 2021		-			-			-
December 31, 2022		-			-			-

F-2622

InThe ~~May~~decrease ~~2020,~~in ~~Lubbock Energy~~proved ~~Partners~~quantities ~~LLC~~for ~~completed~~2021 ~~the~~was ~~foreclosure~~due ofprincipally ~~the~~to ~~Company’s~~revisions ~~remaining~~of ~~ownership~~previous ~~interest~~reserve inestimates ~~the~~after ~~Gap~~undeveloped ~~Band~~reserves ~~property~~were ~~due~~determined to ~~the~~be ~~Company’s default on its $1.1 million~~ non-~~recourse promissory note and accrued interest thereon~~economic. The decrease in proved quantities for ~~2020~~2022 was due principally to ~~this~~annual ~~disposal and revisions of previous reserve estimates caused by a decrease in average NYMEX-WTI oil and Henry Hub natural gas prices~~production.

The decrease in proved quantities for 2021 was due principally to revisions of previous reserve estimates after undeveloped reserves were determined to be non-economic.

Costs Incurred in Oil and Natural Gas Property Acquisitions and Development Activities. Costs incurred by the Company in oil and natural gas acquisitions and development are presented below:

	For the year ended December 31,	~~For the year ended December 31,~~
		2021		2020
	2022		2021
Acquisitions:
Proved	$	-	$	-
Unproved		-		-
Exploration		-		-
Development		-		-
Costs incurred	$	-	$	-

Capitalized Costs. The following table sets forth the capitalized costs and associated accumulated depreciation, depletion, and amortization relating to the Company’s oil and gas acquisition, exploration, and development activities:

	December 31,
	2021			2020
	2022			2021
Proved properties	$	621,198		$	621,198
Unproved properties		1,253,651			1,253,651
		1,874,849			1,874,849
Accumulated DD&A and impairment		(1,874,849	)		(1,874,849	)
Total	$	-		$	-

Future Net Cash Flows. Future cash inflows as of December 31, ~~2021~~2022 and ~~2020~~2021 were calculated using an unweighted arithmetic average of oil and gas prices in effect on the first day of each month in the respective year, except where prices are defined by contractual arrangements. Operating costs, production and ad valorem taxes and future development costs are based on current costs with no escalation. Future development costs include abandonment and dismantlement costs.

The following table sets forth unaudited information concerning future net cash flows for proved oil and gas reserves, net of income tax expense. Income tax expense has been computed using expected future tax rates and giving effect to tax deductions and credits available, under current laws, and which relate to oil and gas producing activities. This information does not purport to present the fair market value of the Company’s oil and gas assets, but does present a standardized disclosure concerning possible future net cash flows that would result under the assumptions used.

	December 31,
	2021			2020
	2022			2021
Future cash inflows	$	~~454~~522,~~030~~560		$	~~775~~454,~~230~~030
Future production costs		(~~278~~296,~~870~~270	)		(~~281~~278,~~420~~870	)
Future development costs		(34,280	)		(~~284~~34,~~450~~280	)
Future income tax expense		-			-
Future net cash flows		~~140~~192,~~880~~010			~~209~~140,~~360~~880
10% annual discount for estimated timing of cash flows		(7288,~~250~~800	)		(~~145~~72,~~600~~250	)
Discounted future net cash flows	$	68103,~~630~~210		$	6368,~~760~~630

F-27

The following table sets forth the principal sources of change in the discounted future net cash flows:

	December 31,
	2021			2020
Balance, beginning of period	$	6368,~~760~~630		$	363,~~445,660~~760
Sales, net of production costs		~~(17~~15,~~880~~524	)		917,~~388~~880
Net change in prices and production costs		~~281~~9,~~375~~984			~~(314~~245,~~633~~615	)
Changes in future development costs		~~(226,800~~-	)		(~~204~~226,~~332~~800	)
Previously estimated development costs incurred during the period		-			-
Revision of quantities		2,209			(38,201	)
Revision of quantities		(38,201	)		(176,729	)
Accretion of discount		6,863			6,376
Accretion of discount		6,376			344,566
Balance, end of period	$	103,210		$	68,630
Sales of minerals in-place		-			(3,040,160	)
Balance, end of period	$	68,630		$	63,760

* * * * *

F-2823

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures. The Company carried out an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Exchange Act Rules. This evaluation was done as of the end of the fiscal year by and under the supervision of the Company’s principal executive officer (who is also the principal financial officer). Based upon that evaluation, the principal executive officer concluded that our disclosure controls and procedures were effective as of December 31, ~~2021~~2022. There have been no significant changes in our internal controls or in other factors that could significantly affect the internal controls subsequent to the date we completed the evaluation.

Management’s Report on Internal Control Over Financial Reporting. Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) of the 1934 Act. Management has assessed the effectiveness of ~~our~~ our internal control over financial reporting as of December 31, ~~2021~~2022 based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

As a ~~result~~ result of this assessment, management identified a material weakness in internal control over financial reporting related to the accounting for business combination transactions. Management has concluded that this deficiency constitutes a material weakness. As a result of the material weakness discussed above, management has concluded that the Company’s internal control over financial reporting was ineffective as of December 31, 2022. Notwithstanding the material weakness, the Company’s management has concluded that the consolidated financial statements, included in the ~~2021~~2022 Annual Report on Form 10-K, fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented in conformity with generally accepted accounting standards.

Management Plans to Remediate Material Weakness. The Company has begun the process of designing and implementing effective internal control measures to improve its internal controls over financial reporting and remediate the reported material weakness. The Company’s efforts include implementing additional reviews of business combination transactions and modifying the Company’s instructions to valuation specialists and reviews of their workproduct. We will consider the material weakness remediated after the applicable controls operate for a sufficient period of time, and management has concluded, through testing, that the controls are operating effectively.

Changes in Internal Control Over Financial Reporting. We regularly review our system of internal control over financial reporting and make changes to our processes and systems to improve controls and increase efficiency, while ensuring that we maintain an effective internal control environment. Changes may include such activities as implementing new, more efficient systems, consolidating activities and migrating processes.

There were no changes in our internal control over financial reporting during the quarter ended December 31, ~~2021~~2022 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on Controls. Our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives as specified above. Management does not expect, however, that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

Item 9B. Other Information

None.

Item 9C. Disclosures Regarding Foreign Jurisdiction that Prevent Inspections

None.

2333

PART III

Item 10. Directors, Executive Officers and Corporate Governance

The following persons are our executive officers and directors and hold the offices set forth opposite their names.

Name	Age	Position
Gary C. Evans	6465	Chairman of the Board and Chief Executive Officer
Melissa Pagen	4647	Senior Vice President, Corporate Development of the Company
Jack Sibley	3738	Vice President, Operations of the Company, and Co-CEO of GENH Halcyon
Watt Stephens	3738	Vice President, Corporate Development of the Company and Secretary of GENH Halcyon
Joe McClaugherty	7071	Lead Director
Gary D. Elliston	6869	Director
John Harris	7374	Director

The following is a brief account of the business experience of each of our directors and executive officers:

Gary C. Evans, Chairman of the Board and Chief Executive Officer. Gary C. Evans is a serial entrepreneur. Mr. Evans previously led Magnum Hunter Resources Corporation for seven years, a NYSE listed public energy company specializing in unconventional resource plays predominately in the Appalachian Basin. Mr. Evans was also founder and CEO of Eureka Hunter Holdings, LLC, a mid-stream gas gathering company transporting and managing up to 1 BCF of daily natural gas volumes from wells producing in West Virginia and Ohio on approximately 200 miles of newly constructed pipeline during the similar seven-year period. Additionally, Mr. Evans previously founded and served as the Chairman and Chief Executive Officer of Magnum Hunter Resources Inc. (MHRI), a NYSE listed company, for twenty years before selling MHRI to Cimarex Energy for approximately $2.2 billion in June 2005. Later that year, Mr. Evans formed Wind Hunter Energy, LLC, a renewable energy company which was subsequently acquired in December 2006 by GreenHunter Energy, Inc., an emerging water resource company focusing on oil field water management and clean water technologies active in the Marcellus and Utica resource plays in Appalachia. As founder, Mr. Evans has served as Chairman and Chief Executive Officer of GreenHunter Energy, Inc. since December 2006 until May 2016 upon the sale of its assets to a private equity fund.

Throughout his career, Mr. Evans has raised various forms of capital on Wall Street that has exceeded $6 Billion. Mr. Evans serves as a Director of Novavax Inc., a NASDAQ listed clinical-stage vaccine biotechnology company (Covid-19 Vaccine) with a market capitalization of approximately $20 Billion, where he has previously served as Chairman, CEO and Lead Director. Mr. Evans was recognized by Ernst and Young as the Southwest Area 2004 Entrepreneur of the Year for the Energy Sector and was subsequently inducted into the World Hall of Fame for Ernst & Young Entrepreneurs. Mr. Evans was also recognized as the Energy Industry Leader of the year in 2013 and chosen by Finance Monthly in 2013 as one of the most respected CEO’s. Mr. Evans was chosen as the Best CEO in the “Large Company” category by Texas Top Producers in 2013. He additionally won the ~~Deal~~ Deal Maker of the Year Award in 2013 by Finance Monthly. Mr. Evans presently serves on the board of directors of U.S. Antimony, a NYSE listed company. Mr. Evans serves on the Board of the Maguire Energy Institute at Southern Methodist University and speaks regularly at both hemp and energy industry conferences and on national television networks around the world on the current affairs of the energy industry.

Melissa Pagen, Senior Vice-President, Corporate Development of the Company. Prior to joining ~~Generation~~the ~~Hemp~~Company, ~~Inc.,~~ Melissa Pagen built over twenty years of professional and executive ~~experience~~ experience in managerial and officer positions in several industries - both in the private and public sectors. With a demonstrated history in consumer goods, business development, investor relations, and industrial technologies, Melissa brings a unique combination of talents to the company. She developed and launched start-up companies in ecommerce, nutraceuticals, and the energy sector. In June 2019, Melissa was brought on by Gary C. Evans to help launch ~~Generation~~the ~~Hemp~~Company, ~~Inc.,~~ although her working tenure with Mr. Evans first began in 2013. In October 2019, she was brought on full-time as an officer of ~~Generation~~the ~~Hemp, Inc~~Company.

2434

From 2016 - 2019 in Los Angeles, Melissa helped develop, launch, and reorganize companies in ecommerce, nutraceuticals, and medical practices through her advising company Root LLC/Root Endeavor LLC. This included working with founders and teams on branding, marketing, product development, packaging, operations, staff reorganization, and optimizing efficiencies. In mid 2013 through 2015, Melissa began working under Gary C. Evans at Green Hunter Resources, Inc., a publicly traded company, where she started as Water Treatment Specialist/Account Executive, then moved into the position of Assistant Vice President, Investor Relations, and ultimately Vice President, Business Development, where she negotiated and secured multi-million-dollar contracts with large E&P companies for water treatment and handling, then oversaw those relationships. During her time in the energy sector, Melissa did several public speaking engagements for industry organizations, which helped earn her the honor of a WING Award (Women In Natural Gas) by Shale Media Group in 2014. Before beginning work with Mr. Evans, Melissa founded her own environmental remediation business in the Bakken Shale of North Dakota from 2012 - 2013. From 2010 - 2012, Melissa worked as Vice President, Marketing and Sales for Sionix Corporation, a publicly traded company in water treatment technology. Following the Tsunami in 2011, Melissa traveled to Japan to participate in discussions to address urgent water treatment issues and potential solutions in the wake of the Fukushima disaster. In 2001, Melissa began her career in the film industry, in development for Radar Pictures, Inc. (f/k/a Interscope Communications [Pictures]). She then worked with a female television Producer from 2004 - 2009. Working alongside creative executives and teams in the Film industry, she developed skills in writing, project management, and visual storytelling that would ultimately contribute to a number of future roles in helping companies develop branding, messaging, marketing, and investor relations. Melissa earned a Bachelor of Arts degree from University of California, Los Angeles where she graduated summa cum laude.

Jack Sibley, Vice President, Corporate Development of the Company, and Co-CEO of GENH Halcyon. Prior to joining ~~Generation~~the ~~Hemp~~Company, Jack Sibley was a founding partner of OZ Capital, LLC, an an Opportunity Zone Investment fund focused on operating businesses within Opportunity Zone designations. In his roll at OZ Capital, ~~Jack~~ Jack oversaw the operations of its portfolio investments, including Halcyon Thruput, an industrial hemp processing company located in Hopkinsville, Kentucky. As an executive, Jack has worked alongside management teams to implement creative, innovative solutions to complex ~~business~~ business issues, identify growth verticals and maximize stakeholder value. Prior to OZ Capital, Jack served as Vice President at ~~Sovrano~~ Sovrano LLC, a Private Equity company focused in Food & Beverage. Jack also co-founded and served as President of Bamboo Juices, LLC in Atlanta, GA from 2014 - 2016. He received an MBA from The University of Georgia’s Terry College of Business in 2014 with concentrations in Finance and Marketing. Jack graduated with a BA in International Affairs from The University of Georgia in 2007.

Watt Stephens, Secretary of GENH Halcyon. ~~Watt~~ Watt began his career as a credit analyst with Frost Bank in 2007, in this role he underwrote countless credit requests in various ~~industries~~ industries including commercial & industrial, energy and real estate. He then moved into a leadership position being tapped to run business development for a newly formed group focused on complex credit relationships. After almost 10 years at Frost Bank, Watt went back to school to earn his MBA and focus on his goal of launching his own business. In 2018, Watt teamed up with Jack Sibley to form OZ Capital LLC, an opportunity zone focused venture capital fund based in Fort Worth. OZ Capital founded and funded Halcyon Thruput in 2019. Watt and Jack stepped in as Co-CEO’s mid-way through 2020 and subsequently sold the business to ~~Generation~~the ~~Hemp~~Company at the beginning of 2021. Watt earned his BS ’07 from SMU and MBA ’17 from SMU’s Cox School of Business.

Joe L. McClaugherty, Director. Mr. McClaugherty previously served as a director of Magnum Hunter Resources Corporation from 2006 through 2016 where he served as Lead Director during the last three years of his tenure. Mr. McClaugherty is a senior partner of McClaugherty & Silver, P.C., a full-service firm engaged in the practice of civil law, located in Santa Fe, New Mexico. He has practiced law for 40 years and has had a Martindale-Hubbell rating of AV Preeminent for over 20 years and is a Fellow of the International Academy of Trial Lawyers. Prior to founding McClaugherty & Silver, P.C. in 1992, he was the Managing Partner of the Santa Fe office of Kemp, Smith, Duncan & Hammond, and, earlier, of Rodey, Dickason, Sloan, Akin & Robb. Mr. McClaugherty has served on numerous boards of both international and domestic companies. He received a BBA with Honors from the University of Texas in 1973 and a JD with Honors from the University of Texas School of Law in 1976. He is admitted to the Bars of the State of New Mexico, Texas and Colorado, as well as the Federal Bars of the Districts of New Mexico and Colorado, the Tenth Circuit Court of Appeals and the United States Supreme Court. The Company believes that it benefits from Mr. McClaugherty’s business and law degrees from the University of Texas at Austin, his approximately 40 years of legal experience in a broad-based civil practice and his extensive business experience on boards of both international and domestic companies.

Gary D. Elliston, Director. Mr. Elliston is the senior founding partner of DeHay & Elliston, L.L.P. where he specializes in the areas of toxic tort, commercial litigation, and professional and product liability litigation. He graduated cum laude from Howard Payne University in 1975, and as a Hatton W. Sumners Foundation Scholar, cum laude, from Southern Methodist University Law School in 1978. In 2007, he received an Honorary Doctorate of Humanities from Howard Payne University. He has served as a member of numerous professional, community and charitable organizations He is licensed to practice law in five states and actively tries cases around the US. He has been recognized multiple years as a Texas Super Lawyer and Best Lawyers in America.

John Harris, Director. Mr. Harris is currently a private investor in a cannabis growing operation based in southern California. Mr. Harris previously served as a member of the senior leadership team at EDS for approximately 25 years. He is also the former President and CEO of eTelecare Global Solutions; a $300M private equity backed business process outsourcing (“BPO”) company. Prior to eTelecare, Mr. Harris was President and CEO of Seven World Wide, a $400 million private equity backed Marketing Services BPO Company with operations in North America and the United Kingdom. Mr. Harris is a graduate of the University of West Georgia where he earned both a BBA and MBA. He currently serves on the Board of Advisors to the Richardson School of Business at the University of West Georgia. Mr. Harris has held board positions with a number of public and private telecommunications and technology services companies, and currently sits on the board of The Hackett Group. Mr. Harris’s experience as a senior executive and board member at a variety of global companies coupled with his recent experience as an investor in the cannabis space makes him an important asset as we grow and expand the Company’s business.

Involvement in Certain Legal Proceedings

In March 2016, during Mr. Evans’ tenure as interim CEO of GreenHunter Resources, Inc. that company and certain of its subsidiaries (namely, GreenHunter Water, LLC; Hunter Disposal, LLC; Ritchie Hunter Water Disposal, LLC; Hunter Hauling, LLC; White Top Oilfield Construction, LLC; Blackwater Services, LLC; Virco Realty, LLC; Little Muskingum Drilling, LLC; Blue Water Energy Solutions, LLC; GreenHunter Wheeling Barge, LLC; GreenHunter Environmental Solutions, LLC; and MAG Tank Hunter, LLC) filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code. GreenHunter Resources, Inc. sought protection in large part because of the cyclical downturn in the commodity prices of both oil and natural gas which had a direct effect on all oil field service companies. GreenHunter Resources, Inc.’s assets were subsequently sold to a private equity group, which allowed predominately all secured indebtedness to be fully repaid.

In December 2015, during Mr. Evans’ tenure as CEO of Magnum Hunter Resources Corporation, that company filed for bankruptcy protection under Chapter 11 of the Bankruptcy Code in Delaware (In re Magnum Hunter Resources Corporation, et al., included the following debtors in addition to Magnum Hunter Resources Corporation, each of which was a directly or indirectly owned subsidiary of Magnum Hunter Resources Corporation: Alpha Hunter Drilling, LLC; Bakken Hunter Canada, Inc.; Bakken Hunter, LLC; Energy Hunter Securities, Inc.; Hunter Aviation, LLC; Hunter Real Estate, LLC; Magnum Hunter Marketing, LLC; Magnum Hunter Production, Inc.; Magnum Hunter Resources GP, LLC; Magnum Hunter Resources, LP; Magnum Hunter Services, LLC; NGAS Gathering, LLC; NGAS Hunter, LLC; PRC Williston LLC; Shale Hunter, LLC; Triad Holdings, LLC; Triad Hunter, LLC; Viking International Resources Co., Inc.; and Williston Hunter ND, LLC). This filing was due in large part to the precipitous commodity cycle downturn which saw the price of natural gas and crude oil reach lows not seen for over a decade. Magnum Hunter Resources Corporation subsequently emerged from bankruptcy with no indebtedness in May 2016 under Mr. Evans’ leadership. The company has since merged with Southwestern Energy Company (NYSE: SWN).

Board of Directors

Our board of directors currently consists of four members, including our Chairman and Chief Executive Officer. In evaluating director candidates, we will assess whether a candidate possesses the integrity, judgment, knowledge, experience, skills and expertise that are likely to enhance the board of directors’ ability to manage and direct our affairs and business, including, when applicable, to enhance the ability of the committees of the board of directors to fulfill their duties. Our directors hold office until the earlier of their death, resignation, retirement, disqualification or removal or until their successors have been duly elected and qualified.

Independent Directors

Under NASDAQ Marketplace Rule 5605(a)(2), a director will not be considered an “independent director” if, such director at any time during the past three years was an employee of the Company, or if a director (or a director’s family member) accepted compensation from the Company (other than compensation for board or board committee service) in excess of $120,000 during any twelve-month period within the three years preceding the determination of independence. In addition, a director will not qualify as an “independent director” if, in the opinion of our Board of Directors, that person has a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. As of the Effective Date, each of Messrs. McClaugherty, Harris, and Elliston ~~will be~~is an “independent director” within the meaning of Nasdaq Marketplace Rule 5605(a)(2). In addition, there ~~will~~are be no family relationships among any of the directors or executive officers of the Company.

Committees of the Board of Directors

We have an audit committee, compensation committee and nominating and corporate governance committee of our board of directors, and may have such other committees as the board of directors shall determine from time to time. Each of the standing committees of the board of directors has the composition and responsibilities described below.

Audit Committee

A minimum of two individuals serves as the members of our audit committee. As required by the rules of the Commission and listing standards of the NASDAQ, where we currently anticipate applying to have our Common Stock listed, the audit committee will consist solely of independent directors within one year of the listing date. Commission rules also require that a public company disclose whether or not its audit committee has an “audit committee financial expert” as a member. An “audit committee financial expert” is defined as a person who, based on his or her experience, possesses the attributes outlined in such rules. John Harris satisfies the definition of “audit committee financial expert”.

The audit committee oversees, reviews, acts on and reports on various auditing and accounting matters to our Board, including: the selection of our independent registered public accounting firm, the scope of our annual audits, fees to be paid to the independent registered public accounting firm, the performance of our independent registered public accounting firm and our accounting practices. In addition, the audit committee oversees our compliance programs relating to legal and regulatory requirements. We have adopted an audit committee charter defining the committee’s primary duties in a manner consistent with the rules of the Commission and the NASDAQ.

Compensation Committee

A minimum of three individuals serves as members of our compensation committee. Our compensation committee reviews and recommends policies relating to compensation and benefits of our directors and employees and is responsible for approving the compensation of our Chief Executive Officer and other executive officers. We have adopted a compensation committee charter defining the committee’s primary duties in a manner consistent with the rules of the Commission and NASDAQ.

Nominating and Corporate Governance

A minimum of three individuals serves as members of our nominating and corporate governance committee. Our nominating and corporate governance committee selects or recommends that the Board select candidates for election to our Board, develops and recommends to the Board corporate governance guidelines that will be applicable to us and oversee board of director and management evaluations. We have adopted a nominating and corporate governance committee charter defining the committee’s primary duties in a manner consistent with the rules of the Commission and NASDAQ.

Code of Business Conduct and Ethics

Our Board adopted a code of business conduct and ethics applicable to our employees, directors and officers, in accordance with applicable U.S. federal securities laws and the corporate governance rules of the NASDAQ. Any waiver of this code may be made only by our Board and will be promptly disclosed as required by applicable U.S. federal securities laws and the corporate governance rules of the NASDAQ. Copies of the Code of Conduct and Financial Code of Ethics are available on our website at https://www.genhempinc.com/ under “Investors.” Information on our website is not incorporated by reference into this annual report or any other filing we file with or furnish to the SEC. Shareholders may also obtain electronic or printed copies by sending a written request to 8533 Midway Road, Dallas, Texas 75209 or by emailing gevans@genhempinc.com,

Lead Independent Director

If at any time, the offices of Chairman of the Board and Chief Executive Officer are held by the same person, we intend that the independent members of the Board will elect on an annual basis with a majority vote an independent director to serve in a lead capacity (the “Lead Independent Director”). The Lead Independent Director coordinates the activities of the other independent directors and perform such other duties and responsibilities as the Board may determine. The Board has adopted a Lead Independent Director Charter defining the Lead Independent Director’s primary duties in a manner consistent with the rules of the Commission and NASDAQ. The Board has selected Mr. McClaugherty to serve as Lead Independent Director.

Corporate Governance Guidelines

After the Effective Date, we anticipate that the Board will adopt corporate governance guidelines in accordance with the corporate governance rules of the NASDAQ.

Item 11. Executive Compensation

Narrative Disclosures

Employment, Severance or Change in Control Agreements. We currently do not maintain any employment, severance or change in control agreements with our named executive officers. In addition, our named executive officers are not entitled to any payments or other benefits in connection with a termination of employment or a change in control.

Retirement Benefits. We have not maintained, and do not currently intend to maintain, a defined benefit pension plan or nonqualified deferred compensation plan.

Compensation of Named Executive Officers

The following table contains compensation data for our named executive officers for the fiscal years ending December 31, ~~2021~~2022 and ~~2020.~~2021:

Name and Principal Position	Fiscal Year	Salary	~~Salary~~		Bonus	~~Bonus~~		Stock Awards	~~Stock Awards~~		Option Awards	~~Option Awards~~		Total Received(1)	~~Total Received(2)~~
Gary C. Evans(1)	2020		$	41,538		$	—		$	—		$	—		$	41,538
Gary C. Evans	2021	$	401,294			610,000			—		$	6,079,586		$	7,090,880
Chief Executive Officer	~~2021~~2022		$400,000	~~401,294~~		—	~~610,000~~		—			$141,659	~~6,079,586~~		$541,659	~~7,090,880~~
Melissa M. Pagen	~~2020~~2021	$	$117,000	~~115,383~~		$—	—		$—	—	$	$759,948	—	$	$876,948	~~115,383~~
Managing Director, Chief Branding Officer, Corporate Secretary (3)	2021		$	117,000			—					$	759,948		$	876,948
Managing Director, Chief Branding Officer, Corporate Secretary	2022		180,000			—			—			—			180,000
Jack Sibley(3)	2020		$	—		$	—		$	—		$	—		$	—
Jack Sibley(2)	2021	$	164,904			—			77,500		$	569,961		$	812,365
Vice President, Corporate Development of the Company, and Co-CEO of GENH Halcyon	~~2021~~2022		$175,000	~~164,904~~		—	—		—	~~77,500~~		$—	~~569,961~~		$175,000	~~812,365~~
Watt Stephens(3)	2020		$	—		$	—		$	—		$	—		$	—
Watt Stephens(2)	2021	$	164,904			—			77,500		$	569,961		$	812,365
Managing Director, Vice President, Corporate Development of the Company and Secretary of GENH Halcyon	~~2021~~2022		$175,000	~~164,904~~		—	—		—	~~77,500~~		$—	~~569,961~~		$175,000	~~812,365~~

(1) ~~Mr.~~Amount ~~Evans~~reflects ~~elected~~total tocompensation ~~reduce~~received ~~his annual salary from $360,000~~ for ~~2020.~~calendar ~~His base salary was restored in 2021~~year.

(2) ~~Amount~~Mr. ~~reflects~~Sibley ~~total~~and ~~compensation~~Mr. ~~received~~Watt ~~for~~joined ~~calendar~~the ~~year~~Company on January 11, 2021. Each receive a base annual salary of $175,000.

~~(3) Mr. Sibley and Mr. Watt joined the Company on January 11, 2021. Each receive a base annual salary of $175,000.~~38

Outstanding Equity Awards at Fiscal Year-End

The following table provides information relating to the unexercised stock options and the unvested stock awards for the Named Executive Officers as of December 31, ~~2021. Each award to each Named Executive Officer is shown separately, with a footnote describing the award’s vesting schedule.~~2022:

	Stock Option Awards							Restricted Stock Awards
	Number of Securities Underlying							Shares of Restricted Stock
	Unexercised Options				Option		Option	That Have Not Vested
Name	Exercisable		Unvested		Exercise Price		Expiration Date	Number		Market Value
Gary C. Evans		25,~~666~~333,~~667~~334		52,~~333~~666,~~333~~666	$	0.76	10/29/2031		—	$	—
Melissa M. Pagen		333,333		666,667	$	0.76	10/29/2031		—	$	—
		—		475,000	$	0.33	08/15/2027		—	$	—
Jack Sibley		250,000		500,000	$	0.76	10/29/2031		250,000	$	77,500
Melissa M. Pagen		666,667		333,333	$	0.76	10/29/2031		—	$	—
Watt Stephens		250,000		500,000	$	0.76	10/29/2031		250,000	$	77,500
Jack Sibley		500,000		250,000	$	0.76	10/29/2031		—	$	—
Watt Stephens		500,000		250,000	$	0.76	10/29/2031		—	$	—

Compensation of Directors

Attracting and retaining qualified non-employee directors is critical to the future value growth and governance of our Company. A significant portion of the total compensation package for our non-employee directors is equity-based to align the interest of these directors with our stockholders.

Directors who are also our employees will not receive any additional compensation for their service on our Board.

Directors are reimbursed for (i) travel and miscellaneous expenses to attend meetings and activities of our Board or its committees; and (ii) travel and miscellaneous expenses related to such director’s participation in general education and orientation programs for directors.

The following table summarizes the compensation awarded or paid to the members of the board of directors, who were compensated for board service beginning with their election to the board of directors in the fiscal year ended December 31, ~~2021. During the fiscal year ended December 31, 2020, we had no non-employee directors.~~2022:

Nature of Director Fees

Director Name

Director

Committee

Option Awards (1)

Total

Joe McClaugherty

—

~~379~~36,~~974~~216

Gary D. Elliston

—

~~379~~36,~~974~~216

John Harris

—

~~379~~36,~~974~~216

Gary C. Evans

—

All directors as a group

—

1108,~~139,922~~648

(1) Each of the directors were granted options for the purchase of ~~500~~120,000 shares of the Company’s common stock. ~~One-third~~in of2022. ~~the~~The awarded options vested ~~immediately~~vest ~~with the remaining options vesting~~ in ~~two~~three equal annual tranches over ~~the~~three ~~next~~years ~~two~~from ~~years~~issuance. Vested options may be exercised at any time until their expiration after 10 years at an exercise price of $0.7630 per share.

The table above does not include the amount of any expense reimbursements paid to the above directors. Mr. Evans does not receive any additional compensation for serving on the Board of Directors other than the compensation described in the Summary Executive Compensation Table, above.

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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The following table sets forth information regarding beneficial ownership of our Common Stock, as of February 28, 2022. We have determined beneficial ownership in accordance with Commission rules. The information does not necessarily indicate beneficial ownership for any other purpose.

Except as indicated in the footnotes to the following table, the persons named in the table has sole voting and investment power with respect to all shares of common stock and preferred stock beneficially owned. Except as otherwise indicated, the address of each of the stockholders listed below is: C/O ~~Generation~~Evergreen ~~Hemp~~Sustainable Enterprises, Inc., 8533 Midway Road, Dallas, Texas 75209.

Name of Beneficial Owner	Amount and Nature of Ownership (1)		Percent of Voting Securities (2)
5% Stockholders:
Satellite Overseas (Holdings) Limited(3)		26,263,144		23.2	%
Corey Wiegard		6,254,843		5.5	%
OZG Agriculture KY, LP		6,250,000		5.5	%
Directors and Named Executive Officers:
Gary C. Evans		37,161,970		32.9	%
Gary C. Evans(4)		38,014,242		33.6	%
Melissa Pagen		-		-	%
Jack Sibley(4)		6,500,000		5.7	%
Jack Sibley(5)		6,500,000		5.7	%
Watt Stephens(4)		6,500,000		5.7	%
Watt Stephens(5)		6,500,000		5.7	%
Gary Elliston		4,090,909		3.6	%
John Harris		284,090		0.3	%
Joe McClaugherty		12,~~814~~027,~~142~~210		1.68	%
All officers and directors as a group		5051,~~101~~166,~~111~~451		4445.32	%

(1)

Beneficial Ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. Each of the beneficial owners listed above has direct ownership of and sole voting power and investment power to the shares of the common stock. For each Beneficial Owner listed, any options or convertible securities exercisable or convertible within 60 days have been also included for purposes of calculating their beneficial ownership of outstanding common stock.

(2) Ownership percentage based on 113,~~094~~204,~~022~~002 fully diluted shares of common stock outstanding as calculated on an as-converted basis.

(3)	Satellite Overseas (Holdings) Limited (“SOHL”) is the record holder of these shares of Common Stock. SOHL is a wholly-owned subsidiary of Cadila Pharmaceuticals Ltd. (“Cadila”). Cadila is owned by the IRM Trust. Rajiv I. Modi, Ph. D. and Mrs. Shilaben I. Modi are the trustees of the IRM Trust. As trustees of the IRM Trust, Dr. Modi and Mrs. Modi have shared voting and dispositive power with respect to these shares and, therefore, under rules issued by the Commission may be deemed to be beneficial owners of the shares.
(4)	~~Because~~Includes of1,061,970 ~~the~~shares ~~relationship~~ of ~~Messrs.~~common ~~Sibley~~stock ~~and~~owned ~~Stephens~~by toInvestment ~~OZG Agriculture KY~~Hunter, LPLLC, ~~Messrs.~~a ~~Sibley~~Texas ~~and~~LLC ~~Stephens~~controlled ~~may be deemed indirect beneficial owners of the 6,250,000 shares of common stock owned~~ by ~~OZG~~Gary ~~Agriculture~~C. ~~KY, LP~~Evans.
(5)	Because of the relationship of Messrs. Sibley and Stephens to OZG Agriculture KY, LP, Messrs. Sibley and Stephens may be deemed indirect beneficial owners of the 6,250,000 shares of common stock owned by OZG Agriculture KY, LP.

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Board Role in Risk Oversight

Our Board of Directors is responsible for the oversight of the Company’s risk management efforts. Members of management are responsible for particular areas of risk for the company and provide presentations, information and updates on risk management efforts as requested by our Board.

Family Relationships

There are no family relationships among our executive officers and directors.

Related Transactions

Home Treasure Finders Merger – On November 27, 2019, Generation Hemp, Inc. (f/k/a Home Treasure Finders, Inc.) (“HTF”) completed the purchase of approximately 68% of the common stock of Energy Hunter Resources, Inc. (“EHR”) through the issuance of 6,328,948 shares of the Company’s Series A Preferred Stock (“Series A Preferred”). Each share of the Series A Preferred; (a) converts into 12 shares of Common Stock, (b) possesses full voting rights, on an as-converted basis, with the Common Stock, and (c) has no dividend rate. The acquisition, together with the other transactions contemplated by the Stock Purchase Agreement, dated August 15, 2019 are referred to herein as the “Transaction”. In connection with the closing of the Transaction, HTF changed its name to Generation Hemp, Inc. The Transaction was accounted for as a reverse merger, whereby EHR is considered to be the accounting acquirer and became a majority-owned subsidiary of the Company. Accordingly, the Company’s historical financial statements prior to the reverse merger were replaced with the historical financial statements of EHR prior to the reverse merger and in this and all future filings with the U.S. Securities and Exchange Commission.

Upon completion of the Transaction, Gary C. Evans, previous Chairman and Chief Executive Officer of Energy Hunter Resources, Inc., became Chairman of the Board of Directors and Chief Executive Officer. In addition, through this Transaction, Mr. Evans and Mr. McClaugherty, acquired their ownership of the Series A Preferred. In the third quarter of 2021, the Company issued 75,947,376 common shares for the conversion of all outstanding shares of its Series A Preferred. Mr. Evans and Mr. McClaugherty received 36,000,000 and 1,743,120 shares of the Company’s common stock, respectively, in exchange for their Series A Preferred.

2021 Issuances of Common Stock Units – In the first quarter of 2021, the Company issued 800,000 common stock units for total proceeds of $400,000. Each common stock unit consists of one share of common stock and a warrant for the purchase of two shares of common stock for $0.50 each. Each warrant is exercisable any time before its expiration on the second anniversary of its issuance. Mr. Evans purchased 100,000 commons stock units in this issuance.

Subordinated Promissory Note to Gary C. Evans – Gary C. Evans made advances of $490,000 to the Company during 2020 under a subordinated promissory note initially due September 30, 2021. This note was amended to a new maturity date of June 30, 2022. If the Company raises new equity capital of $3 million or more, then the full amount outstanding under the note is due within five days. The note bears interest at 10% per annum. The outstanding amount of this this subordinated promissory note was $523,551 and accrued interest totaled $7,602 at December 31, 2021.

Convertible Promissory Note to Gary C. Evans – In 2021, Gary C. Evans made advances totaling $410,000 to the Company under a convertible promissory note. The convertible note matured on January 1, 2022 but was subsequently amended to extend the maturity date to June 30, 2022. If the Company raises new equity capital of $3 million or more, then the full amount outstanding under the note is due within five days. The note bears interest at 10%. The principal and interest due on the convertible note may be converted, at the option of the holder, into restricted shares of the Company’s common stock at a conversion price equal to $0.50 per share. Accrued interest on this convertible promissory note totaled $19,118 at December 31, 2021.

Advances under Promissory Note – In the first quarter of 2022, Investment Hunter, LLC, a Texas LLC controlled by ~~our~~ Gary C. Evans, made advances totaling $439,000 to the Company under a promissory note due June 30, 2022. If the Company raises new equity capital of $3 million or more, then the full amount outstanding under the note is due within five days. The note bears interest at 10% per annum.

December 2020 Issuance of Series B Preferred Stock Units – On December 30, 2020, the Company sold to certain accredited investors, including Gary C. Evans (50 shares), CEO and chairman, and Gary Elliston (25 shares), one of our incoming directors, an aggregate of 135 preferred stock units comprised of (i) one share of Series B Redeemable Convertible Preferred Stock, no par value, and (ii) one warrant exercisable for 50,000 shares of common stock of the Company. On March 9, 2021, Mr. Elliston exercised cash warrants received by him in the Series B Preferred Stock Unit issuance for 1,250,000 shares of common stock.

Gary C. Evans Convertible Note with EHR. In October and December of 2019, Mr. Evans advanced EHR $370,770 under a convertible note bearing interest at 10% per annum. This note, including accrued interest, was converted into 1,061,970 shares of common stock on December 31, 2019.

3141

EHR Series C Preferred Stock – In the third quarter of 2019, EHR raised $850,000 of additional funding through the issuance of 34,000 shares of EHR Series C Preferred Stock. The EHR Series C Preferred Stock converted into 2,414,773 shares of EHR’s common stock upon completion of the Transaction. These common shares were initially accounted for as non-controlling interests in EHR. In an exchange transaction effective November 27, 2019, the Company acquired these non-controlling interests representing approximately 26% of the ownership of EHR through the issuance of 2,414,773 shares of Company common stock and 14,488,638 warrants for the purchase of Company common stock. The warrants have an exercise price of $0.352 per share and expire on November 27, 2021. The warrants may be redeemed beginning October 1, 2020 for $0.0001 per warrant at the Company’s option with 30-days advanced notice should the volume weighted average price exceed $1.00 for any five out of seven consecutive trading days with a minimum average daily trading volume for such seven-day period of at least 25,000 shares of common stock. One-half of the warrants have a cashless exercise feature.

In connection with the exchange transaction, on November 27, 2019, John Harris obtained beneficial ownership of 71,022 shares of common stock, 213,068 cash warrants, and 213,068 cashless warrants. On February 26, 2021, the cash warrants were exercised for the purchase of 213,068 shares of common stock. Also, at the time of the exchange, Gary Elliston received 710,227 shares of common stock, 2,130,682 cash warrants, and 2,130,682 cashless warrants. On March 9, 2021, Mr. Elliston exercised all of his cash warrants and received 2,130,682 shares of common stock. Lastly, at the time of the exchange, Joe McClaugherty received 71,022 shares of common stock, 213,068 cash warrants, and 213,068 cashless warrants. On November 23, 2021, Mr. McClaugherty exercised all of his cash warrants and received 213,068 shares of common stock.

Warrant Exercises – In the fourth quarter of 2021, the Company received $375,000 for the exercise of 1,065,340 outstanding warrants. Mr. Evans exercised warrants that he had acquired from an unrelated stockholder. Mr. Evans received 852,272 shares of the Company’s common stock for total proceeds of $300,000.

Option Grants – In the fourth quarter of 2021, the Company awarded options for 13,850,000 shares of the Company’s common stock as incentive compensation. One-third of the awarded options vested immediately with the remaining options vesting in two equal tranches over the next two years. Vested options may be exercised at any time until their expiration after 10 years. Unvested shares are forfeited upon termination of employment. Mr. Evans received options for 8,000,000 shares of the Company’s common stock in this issuance. Messrs. McClaugherty, Elliston and Harris each received options for 500,000 of the Company’s common stock in this issuance.

Other Related Party Transactions

Please see Note 5 to our audited consolidated financial statements contained in Item 8 of Part II of this Annual Report on Form 10-K for a description of certain other transactions with related parties, which descriptions are incorporated by reference herein.

Director Independence

See Item 10. “Directors, Executive Officers and Corporate Governance” for information regarding our directors and independence requirements applicable for the Board of Directors and its committees.

Item 14. Principal Accountant Fees and Services

Our independent public accounting firm is Marcum LLP, Houston, Texas, PCAOB Auditor ID 688.

The following table sets forth the fees paid by by us for the audit and other services provided by our auditor, Marcum, LLC during the years ended December 31, ~~2021~~2022 and ~~2020~~2021:

	2021		2020
	2022		2021
Audit fees (1)	$	~~283~~239,~~050~~763	$	~~212~~283,~~250~~050
Audit related fees (2)		-		-
Audit related fees		-		-
Tax fees (3)		-		-
Tax fees		-		-
All other fees		-		-
Total fees	$	~~283~~239,~~050~~763	$	~~212~~283,~~250~~050

(1)

Audit Fees: This category represents the aggregate fees billed for professional services rendered by the principal independent accountant for the audit of our annual financial statements and review of financial statements included in our Form 10-K and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for the fiscal years.

(2) Audit Related Fees: This category consists of the aggregate fees billed for services by our independent consultant that are reasonably related to the performance of the audit or review of our financial statements and are not reported under “Audit Fees.”42

(3) Tax Fees: This category consists of the aggregate fees billed for professional services rendered by the principal independent consultant for tax compliance, tax advice, and tax planning.

Audit Committee Pre-Approval Policies and Procedures

The audit committee charter of our board of directors requires the audit committee to pre-approve all audit services and permitted non-audit services (other than de minimis non-audit services as defined by the Sarbanes-Oxley Act of 2002) to be provided by our independent registered public accounting firm. The Audit Committee may form and delegate authority to subcommittees consisting of one or more members when appropriate, including the authority to grant preapprovals of audit and permitted non-audit services, provided that decisions of such subcommittee to grant preapprovals shall be presented to the full Audit Committee at its next scheduled meeting for ratification.

Item 15. Exhibits and Financial Statement Schedules

(a) The following documents are filed as part of this Report:

(1)	Report of Independent Registered Public Accounting Firm (PCAOB ID Number 688)	F-2
	Consolidated Balance Sheets as of December 31, 2021 and 2020	F-4
	Consolidated Balance Sheets as of December 31, 2022 and 2021	F-4
	Consolidated Statements of Operations for the Years Ended December 31, 2021 and 2020	F-5
	Consolidated Statements of Operations for the Years Ended December 31, 2022 and 2021	F-5
	Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the Years Ended December 31, 2021 and 2020	F-6
	Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the Years Ended December 31, 2022 and 2021	F-6
	Consolidated Statements of Cash Flows for the Years Ended December 31, 2021 and 2020	F-7
	Consolidated Statements of Cash Flows for the Years Ended December 31, 2022 and 2021	F-7
	Notes to Consolidated Financial Statements	F-8
(2)	Supplemental Oil and Gas Information (Unaudited)	F-2622

3343

(b) Exhibits:

Exhibit Number		Description
3.1**		Certificate of Incorporation
3.1		Certificate of Incorporation (filed as Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))
3.2**		Bylaws
3.2		Bylaws (filed as Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))
3.3		Certificate of Designation of Rights, Preferences and Limitations of the Series A Convertible Voting Preferred Stock (filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on December 4, 2019 (file number 000-176154))
3.4		Certificate of Designation of Rights, Preferences and Limitations of the Series B Redeemable Convertible Preferred Stock (filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on January 6, 2021 (file number 000-55019))
3.5**		Certificate of Designation of Rights, Preferences and Limitations of the Series C Redeemable Convertible Preferred Stock
4.1		2020 Form of Generation Hemp Warrant (filed as Exhibit 4.1 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))
4.2		Form of Warrant (filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on January 6, 2021 (file number 000-55019))
4.4**		Description of Securities
4.4		Description of Securities (filed as Exhibit 4.4 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))
4.5**		Form of Warrant (2023)
10.1		Deed of Trust, dated September 15, 2014, between JDONE LLC and Thomas S. Yang. (filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on September 19, 2014 (file number 333-176154))
10.2		Promissory Note, dated September 15, 2014, made by JDONE LLC in ~~favour~~favor Thomas S. Yang. (filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on September 19, 2014 (file number 333-176154))
10.3		Amendment No. 1 to Promissory Note and Deed of Trust, dated October 1, 2019, between JDONE LLC, Thomas S. Yang, and Gary C. Evans (filed as Exhibit 10.3 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))
10.4**		Amendment and Extension Agreement to Promissory Note and Deed of Trust, dated October 1, 2019, between JDONE LLC, Thomas S. Yang, and Gary C. Evans
10.4		Amendment and Extension Agreement to Promissory Note and Deed of Trust, dated October 1, 2019, between JDONE LLC, Thomas S. Yang, and Gary C. Evan (filed as Exhibit 10.4 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))
10.5		~~Biomass~~Amendment ~~Tolling~~and Extension Agreement, dated ~~July~~April 1120, ~~2021~~2022, ~~but~~to ~~effective~~Promissory asNote and Deed of ~~June~~Trust 30between JDONE LLC, ~~2021~~Thomas S. Yang, and Gary C. Evans (filed as Exhibit 10.14 to the Company’s ~~Current~~Quarterly Report on Form 810-KQ for the period ended March 31, 2022 filed on ~~July~~May 1223, ~~2021~~2022 (file number ~~000~~333-~~55019~~176154))
10.6		~~Toll~~Amendment ~~Processing~~and Extension Agreement, dated ~~June~~July 818, ~~2021~~2022, to Promissory Note and Deed of Trust between ~~GenH~~JDONE ~~Halcyon~~LLC, ~~Acquisition~~Thomas S. Yang, and ~~Bragg~~Gary ~~Canna,~~C. ~~LLC~~Evans (filed as Exhibit 10.14 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, ~~2021~~2022 filed on August 1319, ~~2021~~2022 (file number ~~000~~333-~~55019~~176154))
10.7		~~Biomass~~Secured ~~Services~~Promissory Note Amendment and Extension Agreement, dated ~~August~~October 1110, ~~2021~~2022, between ~~GenH~~JDONE ~~Halcyon~~LLC, ~~Acquisition~~Thomas S. Yang, and ~~Kushco~~Gary ~~Holdings,~~C. ~~Inc~~Evans (filed as Exhibit 10.43 to the Company’s Quarterly Report on Form 10-Q for the period ended ~~June~~September 30, ~~2021~~2022 filed on ~~August~~November 1314, ~~2021~~2022 (file number ~~000~~333-~~55019~~176154))
10.8**		Merchandise License Agreement dated February 17, 2022 between Gas Monkey Holdings, LLC and Generation Hemp, Inc.
10.8		Biomass Tolling Agreement, dated July 11, 2021, but effective as of June 30, 2021 (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on July 12, 2021 (file number 000-55019))
10.9		Convertible Promissory Note, dated October 15, 2019, made by Home Treasure Finders, Inc. in favor of Energy Hunter Resources, Inc. (filed as Exhibit 10.8 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))
10.10		Security Exchange Agreement, dated as of November 27, 2019, among Energy Hunter Resources, Inc., the former Series C Preferred Shareholders of Energy Hunter Resources, Inc., and Generation Hemp, Inc. (filed as Exhibit 10.9 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))
10.11		2020 Form of Common Stock and Warrant Subscription Agreement of Generation Hemp, Inc. (filed as Exhibit 10.10 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))

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10.12		Subordinated Promissory Note, dated September 30, 2020, made by Generation Hemp, Inc. in favor of Gary C. Evans (filed as Exhibit 10.11 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))
10.9		Toll Processing Agreement, dated June 8, 2021, between GenH Halcyon Acquisition and Bragg Canna, LLC (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2021 filed on August 13, 2021 (file number 000-55019))
10.13		Amended and Restated Subordinated Promissory Note, dated November 11, 2021, with Gary C. Evans as holder (filed as Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2021 filed on November 15, 2021 (file number 000-55019))
10.10		Biomass Services Agreement, dated August 11, 2021, between GenH Halcyon Acquisition and Kushco Holdings, Inc (filed as Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2021 filed on August 13, 2021 (file number 000-55019))
10.14**		Amended and Restated Subordinated Promissory Note, dated January 1, 2022, with Gary C. Evans as holder
10.11		Merchandise License Agreement dated February 17, 2022 between Gas Monkey Holdings, LLC and Generation Hemp, Inc (filed as Exhibit 10.8 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))
10.15		Asset Purchase Agreement, dated March 7, 2020, by and among, Generation Hemp, Inc., GENH Halcyon Acquisition, LLC, Oz Capital, LLC, OZC Agriculture KY LP, Halcyon Thruput, LLC, and the owners set forth therein (filed as Exhibit 10.12 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))
10.12		2020 Form of Common Stock and Warrant Subscription Agreement of Generation Hemp, Inc. (filed as Exhibit 10.10 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))
10.16		First Amendment to Purchase Agreement, dated March 7, 2020, by and among, Generation Hemp, Inc., GENH Halcyon Acquisition, LLC, Oz Capital, LLC, OZC Agriculture KY LP, Halcyon Thruput, LLC, and the owners set forth therein (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 15, 2021 (file number 000-55019))
10.13		Subordinated Promissory Note, dated September 30, 2020, made by Generation Hemp, Inc. in favor of Gary C. Evans (filed as Exhibit 10.11 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))
10.17		Subscription Agreement (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 6, 2021 (file number 000-55019))
10.14		Amended and Restated Subordinated Promissory Note, dated November 11, 2021, with Gary C. Evans as holder (filed as Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2021 filed on November 15, 2021 (file number 000-55019))
10.18		10% Subordinated Promissory Note Due September 30, 2021 (filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on January 6, 2021 (file number 000-55019))
10.15		Amended and Restated Subordinated Promissory Note, dated January 1, 2022, with Gary C. Evans as holder (filed as Exhibit 10.14 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))
10.19**		10% Amended and Restated Subordinated Promissory Note, dated January 31, 2022
10.16		Amended and Restated Subordinated Promissory Note, by Generation Hemp, Inc. with Gary C. Evans as holder, dated July 1, 2022 (filed as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2022 filed on August 19, 2022 (file number 333-176154))
10.20		Subordinated Promissory Note, dated January 11, 2021, made by GENH Halcyon Acquisition, LLC in favor of Halcyon Thruput, LLC (filed as Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on January 15, 2021 (file number 000-55019))
10.18		Amended and Restated Subordinated Promissory Note, by Generation Hemp, Inc. with Gary C. Evans as holder, dated July 1, 2022 (filed as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2022 filed on August 19, 2022 (file number 333-176154))
10.21		Guaranty Agreement by Generation Hemp, Inc. in favor of Coventry Asset Management (filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on January 15, 2021 (file number 000-55019))
10.19		First Amendment to Purchase Agreement, dated March 7, 2020, by and among, Generation Hemp, Inc., GENH Halcyon Acquisition, LLC, Oz Capital, LLC, OZC Agriculture KY LP, Halcyon Thruput, LLC, and the owners set forth therein (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 15, 2021 (file number 000-55019))
10.22		Letter Agreement, dated November 11, 2021, with Coventry Asset Management, LTD (filed as Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2021 filed on November 15, 2021 (file number 000-55019))
10.20		Asset Purchase Agreement, dated March 7, 2020, by and among, Generation Hemp, Inc., GENH Halcyon Acquisition, LLC, Oz Capital, LLC, OZC Agriculture KY LP, Halcyon Thruput, LLC, and the owners set forth therein (filed as Exhibit 10.12 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019 filed on December 15, 2020 (file number 333-176154))
10.23**		Letter Agreement, dated March 7, 2022, with Coventry Asset Management, LTD
10.21		Subscription Agreement (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 6, 2021 (file number 000-55019))
10.24		Unsecured Promissory Note, dated August 11, 2021, with Gary C. Evans as holder (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2021 filed on August 13, 2021 (file number 000-55019))
10.22		Guaranty Agreement by Generation Hemp, Inc. in favor of Coventry Asset Management (filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on January 15, 2021 (file number 000-55019))
10.25		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated August 30, 2021, with Gary C. Evans as holder (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 30, 2021 (file number 000-55019))
10.26		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated September 9, 2021, with Gary C. Evans as holder (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September 10, 2021 (file number 000-55019))
10.27		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated September 28, 2021, with Gary C. Evans as holder (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September 29, 2021 (file number 000-55019))
10.28		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated November 11, 2021, with Gary C. Evans as holder (filed as Exhibit 10.9 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2021 filed on November 15, 2021 (file number 000-55019))
10.29**		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated January 1, 2022, with Gary C. Evans as holder
10.30**		Real Estate Option to Purchase Contract, dated January 11, 2021
10.31**		Real Estate Option to Purchase Contract, as amended March 25, 2022
10.32**		Unsecured Promissory Note, dated March 18, 2022, with Investment Hunter, LLC as holder
10.33#		Term Employment Agreement with Jack Sibley (filed as Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on January 15, 2021 (file number 000-55019))
10.34#		Term Employment Agreement with Watt Stephens (filed as Exhibit 10.5 to the Company’s Current Report on Form 8-K filed on January 15, 2021 (file number 000-55019))

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10.35		Note Contribution Agreement, dated March 9, 2021, among Energy Hunter Resources, Inc., Satellite Overseas (Holdings) Limited, and Generation Hemp, Inc. (filed as Exhibit 10.21 to the Company’s Annual Report on Form 10-K filed on March 31, 2021 (file number 000-55019))
10.23		Letter Agreement, dated November 11, 2021, with Coventry Asset Management, LTD (filed as Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2021 filed on November 15, 2021 (file number 000-55019))
10.36		2021 Form of Common Stock and Warrant Subscription Agreement of Generation Hemp, Inc. (filed as Exhibit 10.22 to the Company’s Annual Report on Form 10-K filed on March 31, 2021 (file number 000-55019))
10.24		Letter Agreement, dated March 7, 2022, with Coventry Asset Management, LTD (filed as Exhibit 10.23 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))
10.37#**		Form of Incentive Stock Option Agreement under 2021 Omnibus Incentive Plan
10.25		Letter Agreement, dated May 11, 2022, with Coventry Asset Management, LTD (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2022 filed on May 23, 2022 (file number 333-176154))
10.38#**		Form of Non-Qualified Stock Option Agreement under 2021 Omnibus Incentive Plan
10.26		Letter Agreement, dated July 31, 2022, with Coventry Asset Management, LTD (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2022 filed on August 19, 2022 (file number 333-176154))
10.39#**		Form of Restricted Stock Award Agreement under 2021 Omnibus Incentive Plan
10.27		Unsecured Promissory Note, dated August 11, 2021, with Gary C. Evans as holder (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2021 filed on August 13, 2021 (file number 000-55019))
10.40#**		Form of Restricted Stock Units Award Agreement under 2021 Omnibus Incentive Plan
10.28		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated August 30, 2021, with Gary C. Evans as holder (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 30, 2021 (file number 000-55019))
10.41#**		Form of Stock Appreciation Right Grant Agreement under 2021 Omnibus Incentive Plan
10.29		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated September 9, 2021, with Gary C. Evans as holder (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September 10, 2021 (file number 000-55019))
21**		List of Subsidiaries of the Company
10.30		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated September 28, 2021, with Gary C. Evans as holder (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September 29, 2021 (file number 000-55019))
31.1**		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302
10.31		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated November 11, 2021, with Gary C. Evans as holder (filed as Exhibit 10.9 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2021 filed on November 15, 2021 (file number 000-55019))
32.1**		Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of The Sarbanes-Oxley Act of 2004
10.32		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated January 1, 2022, with Gary C. Evans as holder (filed as Exhibit 10.29 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))
101.INS		Inline XBRL Instance Document
10.33		Amended and Restated Promissory Note, by Generation Hemp, Inc., dated May 19, 2022, with Gary C. Evans as holder (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2022 filed on May 23, 2022 (file number 333-176154))
101.SCH		Inline XBRL Taxonomy Extension Schema Document
10.34		Amended and Restated Promissory Note by Generation Hemp, Inc. with Gary C. Evans as holder, dated July 1, 2022 (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2022 filed on August 19, 2022 (file number 333-176154))
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
10.35		Amended and Restated Convertible Promissory Note by Generation Hemp, Inc. with Gary C. Evans as holder, dated September 30, 2022 (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2022 filed on November 14, 2022 (file number 333-176154))
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
10.36		Unsecured Promissory Note, dated March 18, 2022, with Investment Hunter, LLC as holder (filed as Exhibit 10.32 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
10.37		Amended and Restated Unsecured Promissory Note, dated May 19, 2022, with Investment Hunter, LLC as holder (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2022 filed on May 23, 2022 (file number 333-176154))
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

10.38		Revised and Extended Unsecured Promissory Note with Investment Hunter, LLC as holder, dated July 1, 2022 (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2022 filed on August 19, 2022 (file number 333-176154))

10.39		Revised and Extended Unsecured Promissory Note, dated September 30, 2022, with Investment Hunter, LLC as holder, dated September 30, 2022 (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2022 filed on November 14, 2022 (file number 333-176154))

10.40#		Term Employment Agreement with Jack Sibley (filed as Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on January 15, 2021 (file number 000-55019))

10.41#		Term Employment Agreement with Watt Stephens (filed as Exhibit 10.5 to the Company’s Current Report on Form 8-K filed on January 15, 2021 (file number 000-55019))

10.42		Note Contribution Agreement, dated March 9, 2021, among Energy Hunter Resources, Inc., Satellite Overseas (Holdings) Limited, and Generation Hemp, Inc. (filed as Exhibit 10.21 to the Company’s Annual Report on Form 10-K filed on March 31, 2021 (file number 000-55019))

10.43		2021 Form of Common Stock and Warrant Subscription Agreement of Generation Hemp, Inc. (filed as Exhibit 10.22 to the Company’s Annual Report on Form 10-K filed on March 31, 2021 (file number 000-55019))

10.44#		Form of Incentive Stock Option Agreement under 2021 Omnibus Incentive Plan (filed as Exhibit 10.37 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))

10.45#		Form of Non-Qualified Stock Option Agreement under 2021 Omnibus Incentive Plan (filed as Exhibit 10.38 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))

10.46#		Form of Restricted Stock Award Agreement under 2021 Omnibus Incentive Plan (filed as Exhibit 10.39 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))

10.47#		Form of Restricted Stock Units Award Agreement under 2021 Omnibus Incentive Plan (filed as Exhibit 10.40 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))

10.48#		Form of Stock Appreciation Right Grant Agreement under 2021 Omnibus Incentive Plan (filed as Exhibit 10.41 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed on April 12, 2022 (file number 333-176154))

10.49**		Form of Subscription Agreement for Series C Redeemable Convertible Preferred Stock

10.50**		Letter Agreement, dated April 27, 2023, with Coventry Asset Management, LTD

10.51**		Secured Promissory Note, dated April 19, 2023, made by Razorback I, LLC, in favor of Michael A. McManus and Gary C. Evans

10.52**		Guaranty Agreement by Evergreen Sustainable Enterprises, Inc. in favor of in favor of Michael A. McManus and Gary C. Evans

21**		List of Subsidiaries of the Company

31.1**		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302

32.1**		Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of The Sarbanes-Oxley Act of 2004

101.INS		Inline XBRL Instance Document

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

Exhibit filed herewith

Constitutes a management compensatory plan or arrangement.

3647

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

	GENERATION HEMP, INC. (Registrant)
	EVERGREEN SUSTAINABLE ENTERPRISES, INC. (FORMERLY GENERATION HEMP, INC.) (Registrant)
DATE: April 12, 2022	By:	/s/ Gary C. Evans
DATE: May 18, 2023	By:	/s/ Gary C. Evans
		Gary C. Evans
		Chairman and Chief Executive Officer

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Filing Compare · Evergreen Sustainable Enterprises, Inc.