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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

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

For the fiscal year ended December 31, ~~2023~~2024

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

Commission file number 000-50331

CalEthos, Inc.

(Exact name of registrant as specified in its charter)

Nevada		98-0371433
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

11753 Willard Avenue Tustin, California		92782
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (714) 352-5315

Securities registered under Section 12(b) of the Act:

None		N/A
Title of each class		Name of each exchange on which registered

Securities registered under Section 12(g) of the Act:

Common Stock, $0.001 par value

(Title of class)

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

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

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

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

Indicate by checkmark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐

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 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. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

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

The aggregate market value of the voting and non-voting common stock, other than shares held by persons who may be deemed affiliates of ~~the~~ the registrant, as of June 30, ~~2023~~2024, the last day of the registrant’s most recently completed second fiscal quarter, was $225,~~770~~483,~~711~~343, computed by reference to the closing sales price for the registrant’s common stock on June 3028, ~~2023~~2024, as reported on The ~~OTC~~OTCQB ~~Pink~~ Market.

As of March 3028, ~~2024~~2025, there were 2425,~~330~~730,540 outstanding shares of the registrant’s common stock, par value $0.001 per share.

CalEthos, Inc.

Annual Report on Form 10-K

For the Fiscal-Year Ended December 31, ~~2023~~2024

TABLE OF CONTENTS

		Page
Cautionary Note Regarding Forward Looking Statements		ii
PART I
Item 1.	Business.	1
Item 1A.	Risk Factors.	68
Item 1B.	Unresolved Staff Comments	68
Item 1C.	Cybersecurity	68
Item 2.	Properties.	68
Item 3.	Legal Proceedings.	68
Item 4.	Mine Safety Disclosures	68
PART II
Item 5.	Market for Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities Market Information.	79
Item 6.	Selected Financial Data.	79
Item 7.	Management’s Discussion and Analysis of Financial Condition and Result of Operations.	89
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk.	1314
Item 8.	Financial Statements and Supplementary Data.	1314
Item 9.	Changes In and Disagreements with Accountants On Accounting and Financial Disclosure.	1314
Item 9A.	Controls and Procedures.	1314
Item 9B.	Other Information.	1415
PART III
Item 10.	Directors, Executive Officers, Promoters and Control Persons; Compliance With Section 16(A) of the Exchange Act.	1516
Item 11.	Executive Compensation	18
Item 12.	Security Ownership of Certain Beneficial Owners and Management	2425
Item 13.	Certain Relationships and Related Transactions and Director Independence.	2526
Item 14.	Principal Accountant Fees and Services.	2527
Part IV
Item 15.	Exhibits	2628

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

The statements contained in this report with respect to our financial condition, results of operations and business that are not historical facts are “forward-looking statements”. Forward-looking statements can be identified by the use of forward-looking terminology, such as “anticipate”, “believe”, “expect”, “plan”, “intend”, “seek”, “estimate”, “project”, “could”, “may” or the negative thereof or other variations thereon, or by discussions of strategy that involve risks and uncertainties. Management wishes to caution the reader of the forward-looking statements that any such statements that are contained in this report reflect our current beliefs with respect to future events and involve known and unknown risks, uncertainties and other factors, including, but not limited to, economic, competitive, regulatory, technological, key employees, and general business factors affecting our operations, markets, growth, services, products and other factors, some of which are described in this report and some of which are discussed in our other filings with the Securities and Exchange Commission. These forward-looking statements are only estimates or predictions. No assurances can be given regarding the achievement of future results, as actual results may differ materially as a result of risks facing our company, and actual events may differ from the assumptions underlying the statements that have been made regarding anticipated events.

Important factors to consider in evaluating any forward-looking statements include:

● our ability to finance and complete the design and construction of our proposed data center ~~operation~~operations; ● our ability to obtain all of the necessary regulatory approvals for our proposed data center operations and the energy needed to power such operations; ● our ability to implement our business plan; ● our ability to attract key personnel; ● our ability to operate profitably; ● our ability to efficiently and effectively finance our operations; ● inability to achieve future sales levels or other operating results; ● inability to raise additional financing for working capital; ● inability to efficiently manage our operations; ● the inability of management to effectively implement our strategies and business plans; ● the unavailability of funds for capital expenditures and/or general working capital; ● the fact that our accounting policies and methods are fundamental to how we report our financial condition and results of operations, and they may require management to make estimates about matters that are inherently uncertain; ● deterioration in general or regional economic conditions; ● changes in U.S. GAAP or in the legal, regulatory and legislative environments in the markets in which we operate; ● adverse state or federal legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations;

These risk factors should be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue. All written and oral forward looking statements made in connection with this report that are attributable to our company or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Given these uncertainties, we caution investors not to unduly rely on our forward-looking statements. We do not undertake any obligation to review or confirm analysts’ expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events, except as required by applicable law or regulation.

Notwithstanding the above, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), expressly state that the safe harbor for forward-looking statements does not apply to companies that issue penny stock. If, as now, we are considered to be an issuer of penny stock, the safe harbor for forward-looking statements may not apply to us at certain times.

Throughout this report, unless otherwise designated, the terms “we,” “us,” “our,” “the Company” and “our company” refer to CalEthos, Inc., a Nevada corporation. All amounts are in U.S. Dollars, unless otherwise indicated.

Item 1.

Business.

We are ina ~~the~~data ~~early~~center ~~stages~~infrastructure ofdeveloper ~~implementing~~that ~~our~~is ~~plan~~developing ~~for~~a ~~the~~large-scale, ~~construction~~geothermal ~~and operation of clean-energy-~~powered data ~~centers~~center tocampus ~~lease~~in toSouthern ~~large~~California. ~~enterprise~~Our ~~information~~development ~~technology~~site ~~(IT)~~is ~~customers~~located ~~that~~in ~~are~~Imperial ~~creating~~County oron ~~addressing~~ the ~~growing~~edge ~~demand~~of ~~for~~California’s ~~AI,~~Lithium ~~Cloud and High-Performance Computing (HPC) digital services. Data centers are highly-specialized and secure buildings that house networking~~Valley, ~~storage~~which ~~and~~is ~~communications~~one of ~~technology~~the ~~infrastructure,~~world’s ~~including~~largest ~~servers,~~known ~~storage~~geothermal ~~devices, switches, routers~~ and ~~fiber~~lithium ~~optic transmission equipment~~resources. ~~They~~Imperial ~~are~~County ~~designed to~~has ~~provide~~an ~~the~~abundance ~~space,~~of ~~power,~~geothermal ~~cooling~~energy ~~and~~that radiates ~~network~~from ~~connectivity~~a ~~necessary~~shallow tolava ~~efficiently~~flow ~~operate~~between ~~mission-critical~~the ITNorth ~~equipment.~~America ~~Telecommunications carriers~~ and ~~internet~~Pacific ~~providers~~tectonic ~~typically provide network access into a data center through optical fiber connections~~plates. The ~~demand~~potential ~~for data~~geothermal ~~center~~energy ~~infrastructure~~that iscan ~~being driven by many factors, but most importantly by significant growth in data and increased demand for~~be ~~data~~harvested ~~processing and storage infrastructure. The market~~ for baseload data center ~~facilities~~power ~~includes~~with ~~established~~flash, ~~“traditional”~~binary, ~~enterprises that~~and ~~are~~advanced ~~web~~closed-~~enabling~~loop ~~their~~geothermal technologies ~~applications~~is ~~and~~projected ~~business~~to ~~processes,~~be asin ~~well~~the astens ~~cloud-centric~~of ~~companies with sophisticated technology requirements~~gigawatts.

~~There~~Over ~~are~~the ~~many~~past ~~types~~three ofyears, ~~data~~we ~~centers~~have ~~and~~been ~~service~~working ~~models~~with ~~available~~Imperial inCounty ~~the~~government ~~marketplace. Generally~~officials, ~~their~~Imperial ~~classification~~County ~~depends~~Planning on& ~~whether~~Development, ~~they~~the ~~are~~Imperial ~~owned~~County byBoard ~~one~~of orSupervisors, ~~many~~Imperial ~~organizations~~Irrigation District (“IID” - the local electric utility), ~~how~~Imperial ~~they~~Valley Economic ~~fit~~Development ~~into~~Corp ~~the~~and ~~topology~~various ofestablished ~~other~~local ~~data~~geothermal ~~centers~~power producers, ~~what~~as ~~technologies~~well ~~they~~as ~~use~~closed-loop ~~for~~geothermal ~~computing~~technology ~~and~~companies ~~storage,~~to ~~and~~develop ~~even~~a ~~their~~portfolio ~~energy~~of ~~efficiency.~~geothermal ~~However,~~energy ~~there~~resources ~~are~~to ~~four~~power ~~main~~a ~~types~~large-scale, ofmaster-planned data ~~centers:~~center campus.

●In July ~~Enterprise~~2024, ~~Data~~we ~~Centers.~~canceled ~~These~~an ~~are~~option ~~built,~~to ~~owned~~purchase ~~and~~an ~~operated~~80-acre bysite ~~companies~~ and ~~are~~optioned ~~optimized~~a ~~for~~new ~~their~~315-acre ~~end~~site ~~users.~~for ~~Most~~our ~~often~~data ~~they~~center ~~are housed on the corporate~~ campus. development, ●and ~~Managed~~we ~~Services~~are ~~Data~~in ~~Centers.~~the ~~These~~process ~~data~~of ~~centers~~contracting ~~are~~an ~~managed~~additional by320 aadjacent ~~third~~acres ~~party~~that ~~(or~~will abe ~~managed~~used ~~services~~for ~~provider)~~onsite ongeothermal ~~behalf~~power production ofin athe ~~company~~future. ~~The~~Combined, ~~company~~these ~~leases~~properties ~~the~~will ~~equipment~~create ~~and~~our ~~infrastructure~~master ~~instead~~planned, of635-acre, ~~buying~~vertically-integrated, geothermal-powered ~~it.~~data ●center ~~Wholesale~~campus. ~~Colocation~~The ~~Data~~overall ~~Centers.~~infrastructure Inis ~~colocation~~planned ~~(“colo”)~~to ~~data~~include ~~centers,~~ a ~~company~~switchyard/substation ~~rents~~to ~~space~~connect ~~within~~off-site power athrough ~~data~~the ~~center~~local ~~owned~~grid ~~by others~~ and ~~located~~onsite ~~off~~geothermal ~~company~~power ~~premises.~~production ~~The~~to ~~colocation~~our data center ~~hosts~~buildings, ~~the~~connections ~~infrastructure:~~for ~~building,~~natural ~~cooling,~~gas ~~bandwidth,~~for back-up ~~security~~generators, ~~etc.,~~and ~~while~~diverse ~~the~~fiber ~~company~~paths ~~provides~~for ~~and~~internet ~~manages the components~~connectivity, ~~including servers~~water/sewer, ~~storage,~~ and ~~firewalls.~~other ●utilities ~~Cloud~~and ~~Data~~services ~~Centers.~~required Into build ~~this~~and ~~off-premises~~operate ~~form of~~ data center, ~~data~~facilities ~~and~~on ~~applications~~the ~~are~~campus. ~~hosted by a cloud services provider such as Amazon Web Services (AWS)~~Overall, ~~Microsoft~~the ~~(Azure),~~site oris ~~IBM~~being ~~Cloud~~planned orto ~~other public cloud provider.~~support:

~~We are~~● ~~developing~~Onsite ~~our~~production ~~business~~of ~~model~~a togigawatt ~~compete~~or inmore ~~the wholesale colocation segment~~ of ~~the~~geothermal ~~data~~power; ~~center~~● ~~services~~A ~~industry,~~switchyard ~~which~~for isoffsite ~~focused on~~geothermal/solar/battery ~~providing~~power ~~data~~connections ~~center~~from ~~space~~providers tothrough ~~companies that provide~~ the ~~processing,~~local ~~networking~~grid; ~~and~~● ~~storage~~Twelve of25-acre ~~data.~~building ~~With the move to treat data as an asset~~lots, ~~the~~each ~~data~~of ~~services~~which ~~market~~can issupport ~~expected~~up to ~~experience significant growth over the next decade. Industry automation and digital businesses are expanding~~250,000 ~~and~~square ~~these~~feet ~~businesses are expected to require huge amounts~~ of data ~~for~~center ~~their~~buildings; ~~businesses.~~and ~~North~~● ~~America~~Connections isfor ~~the most~~gas, ~~advanced~~water, ~~region~~sewer ~~globally~~ and ~~data~~fiber ~~center services are in high demand~~connectivity.

We plan to offer hyperscale and data center development companies the following options:

	●	Powered land leases (building lots with power)

	●	Powered shell leases (a basic building with power)

	●	Build-to-suit leases (completed buildings with power based on a customer’s design)

	●	Co-development with data center developers (we and a data center developer will jointly build out a section of the campus)

InWe ~~planning~~plan ~~for~~to ~~our~~lease ~~initial~~powered ~~data~~building ~~centers,~~lots ~~we are in discussions with several large companies that would lease all~~ or ~~part~~powered ofshell ~~the data center campus~~buildings, ~~with~~or ~~the~~to ~~intention~~provide ~~of cultivating long~~build-~~term~~to-suit ~~strategic~~completed ~~relationships~~buildings, ~~with~~to ~~them~~large ~~once they become our customers and providing them~~enterprise ~~with~~information ~~solutions~~technology ~~for their data center facilities and~~ (IT) ~~infrastructure~~companies ~~requirements.~~that Weare ~~initially~~creating ~~intend~~or toaddressing ~~provide~~the ~~clean-energy~~growing ~~powered wholesale~~demand ~~colocation space with flexibility~~ for ~~customers to scale for future growth. As currently contemplated~~AI, ~~our~~Cloud ~~offerings will provide clean energy power, flexibility, reliability~~ and ~~security delivered through a tailored, customer~~High-~~service-focused platform that will be~~Performance ~~designed~~Computing to(HPC) ~~foster~~digital ~~long-term relationships~~services. ~~Our~~We ~~plan~~are iscurrently toin ~~focus~~discussions onwith ~~technology~~a ~~and~~number ~~large~~of ~~cloud~~these ~~computing~~companies ~~customers~~and, ~~that~~based ~~are~~upon ~~expanding their services rapidly in~~ the ~~public~~interest ~~and~~we have ~~private~~received ~~cloud~~thus ~~environments~~far tofrom ~~provide~~potential ~~them~~tenants, ~~with~~we ~~solutions that address their current and future needs. We~~ expect that ~~our~~we ~~facilities and construction design~~ will ~~allow~~have usagreements signed to ~~offer~~lease ~~flexibility~~all inor ~~rack~~a ~~density~~substantial ~~and~~part ~~power resiliency,~~of ~~and~~ the ~~opportunity~~development ~~for~~by ~~expansion~~the asend ~~our~~of ~~customers’~~2025 ~~needs~~or ~~grow~~early 2026.

~~Plan~~In addition to our Southern California site, we are identifying and evaluating ofsites ~~Operations~~in other states that have adequate land, geothermal resources and internet connectivity that can support a one gigawatt or larger data center campus. We believe there are numerous areas in the country where advanced closed loop geothermal technology can economically harvest energy for onsite use in data centers and other energy intense industries.

AsData ofcenters ~~the~~are ~~filing~~highly ofspecialized ~~this~~and ~~Report,~~secure webuildings ~~have~~that ~~completed~~house ~~Phase~~networking, Istorage and ~~entered~~communications ~~into~~technology ~~Phase~~infrastructure, ~~II of our data center development plans. In the initial~~including ~~phase~~servers, ofstorage ~~our~~devices, ~~project~~switches, werouters ~~signed~~and anfiber ~~option~~optic ~~agreement~~transmission onequipment. ~~March~~They ~~30,~~are ~~2023~~designed to ~~acquire~~provide 80the ~~acres of commercially-zoned land in Imperial County~~space, ~~California~~ ~~that is surrounded by nearby geothermal~~ power, ~~plants~~ cooling and ~~solar~~network ~~farms.~~connectivity Wenecessary ~~believe~~to ~~this~~efficiently ~~site~~operate ismission-critical aIT ~~unique~~equipment. ~~location~~Telecommunications incarriers ~~that~~and itinternet providers ~~will~~typically provide usnetwork ~~with~~access ainto ~~rare opportunity to acquire commercially-zoned land on which we can combine nearby direct clean geothermal/solar energy with~~ a ~~24/7~~ data center ~~operation.~~through Weoptical ~~believe~~fiber ~~100%~~connections. ~~clean-energy-powered~~The ~~data~~demand ~~centers~~for ~~are~~data ancenter ~~important~~infrastructure ~~element~~is ~~in the ability of~~being ~~the~~driven ~~U.S.~~by tomany ~~meet~~factors, ~~its~~but ~~carbon~~most ~~neutral~~importantly ~~climate~~by ~~goals~~significant ~~and~~growth ~~for~~in ~~hyperscale~~data and ~~enterprise~~increased ITdemand ~~companies~~for todata ~~meet~~processing ~~their shareholder~~ and ~~customer~~storage infrastructure. ~~commitments~~The tomarket ~~have~~for andata ~~ESG-compliant,~~center ~~clean~~facilities ~~digital~~includes ~~footprint~~established ~~before~~“traditional” ~~2030.~~enterprises Asthat aare ~~result,~~web-enabling wetheir ~~believe the availability of nearby clean energy~~applications ~~for~~and ~~our~~business ~~Imperial~~processes, ~~County~~as ~~site~~well ~~will~~as ~~provide~~cloud-centric uscompanies awith ~~significant~~sophisticated ~~competitive~~technology ~~advantage in the marketplace~~requirements.

InThere ~~Phase~~are Imany types of ~~our~~data ~~development~~centers ~~plan,~~and ~~which~~service wemodels ~~completed~~available in ~~December~~the ~~2023~~marketplace. Generally, wetheir ~~contracted~~classification ~~with~~depends ~~leading~~on ~~data~~whether ~~center~~they are ~~advisory~~owned ~~firms~~by toone ~~complete site~~or many organizations, ~~power~~how ~~and~~they ~~connectivity~~fit ~~assessments,~~into ~~feasibility~~the ~~studies~~topology of other data centers, ~~engineering~~what ~~plans~~technologies they use for computing and ~~project~~storage, ~~benchmarking~~and even their energy efficiency. ~~Phase~~However, Ithere ofare ~~our~~four ~~plan~~main ~~included~~types of data centers:

● ~~Engaging~~Enterprise ~~HDR~~Data ~~Engineering, Inc~~Centers. These are built, aowned ~~global~~and ~~professional~~operated ~~services~~by ~~firm~~companies ~~specializing~~requiring indata ~~architecture,~~storage ~~engineering,~~for ~~environmental~~their ~~and~~own ~~construction~~purposes ~~services~~and ~~(“HDR~~are ~~Engineering”),~~optimized tofor ~~complete~~their aend ~~site~~users. ~~assessment,~~Most ~~project~~often ~~feasibility~~they ~~study,~~are ~~and~~housed on the ~~initial~~corporate ~~shovel-ready~~campus ~~site~~of ~~development~~the ~~plan~~owner. ~~for~~● ~~our~~Managed ~~Imperial~~Services ~~County~~Data ~~site~~Centers. ●These ~~Engaging~~data ~~ZGlobal,~~centers ~~Inc.,~~are managed by a ~~power~~third ~~engineering~~party ~~and~~(or ~~energy~~a ~~solutions~~managed ~~firm~~services ~~(“ZGlobal”~~provider), toon ~~assess~~behalf ~~all~~of ~~available~~a ~~power~~company ~~and~~requiring ~~transmission~~data ~~routes~~storage. inThe ~~the~~operating ~~immediate~~company ~~area~~leases of the ~~site~~equipment and toinfrastructure ~~develop~~instead aof ~~plan~~buying toit. ~~access~~● ~~power~~Wholesale ~~from~~Colocation ~~close~~Data byCenters. ~~geothermal~~In ~~and~~the ~~solar~~case ~~producers~~of ~~via~~colocation ~~Behind-The-Meter,~~(“colo”) ~~Off-Take~~data ~~and~~centers, ~~Power~~a ~~Purchase~~company ~~Agreements~~rents ~~directly~~space ~~and~~within ~~through~~a ~~agreements~~data ~~with~~center ~~the~~owned ~~local~~by ~~grid~~others ~~operator.~~and ●located ~~Engaging~~off ~~American~~the ~~Dark~~company’s ~~Fiber, Inc~~premises., aThe ~~provider~~colocation ofdata ~~dark~~center ~~fiber~~hosts ~~connectivity~~the toinfrastructure: ~~municipalities~~building, ~~carriers~~cooling, ~~anchor~~bandwidth, ~~institutions~~security, ~~content developers~~etc., ~~data-center~~while ~~operators,~~the ~~and~~company ~~other~~provides ~~sophisticated~~and ~~private~~manages ~~network~~the ~~users~~components, toincluding ~~develop~~servers, astorage ~~robust~~and ~~fiber-based~~firewalls. ~~infrastructure~~● ~~that~~Cloud ~~will~~Data ~~provide~~Centers. ~~multiple~~In ~~diverse~~this ~~geographic~~off-premises ~~routes~~form of ~~connectivity~~data tocenter, ~~our~~ data ~~center~~and ~~site.~~applications ●are ~~Engaging~~hosted ~~Linesight,~~by a ~~construction~~cloud ~~consultancy~~ services ~~firm (“Linesight”)~~provider, tosuch ~~provide~~as ~~cost~~Amazon ~~benchmarking~~Web ofServices ~~initial~~(AWS), ~~design~~Microsoft ~~concepts~~(Azure), ~~and~~or toIBM ~~assist~~Cloud ~~with~~or ~~desktop~~other ~~pre-qualification~~public ofcloud ~~architect-engineering firms and construction managers~~provider.

~~Based~~We onare ~~the~~developing ~~project~~our ~~assessment,~~business ~~feasibility~~model ~~and~~to ~~initial~~compete ~~shovel-ready~~in ~~site~~the ~~plan~~data ~~developed~~center byinfrastructure ~~HDR~~development ~~Engineering,~~segment ~~and~~of the ~~benchmarking~~data ofcenter ~~the~~industry, ~~project~~which byis ~~Linesight~~focused ~~against~~on 25providing ~~other~~ready-to-build-on ~~large~~ data center ~~developments~~campuses into ~~the~~companies ~~U.S.~~that ~~over~~provide the ~~last 24 months~~processing, wenetworking ~~plan~~and tostorage ~~develop~~of ~~our 80-acre parcel~~data. inWith ~~Imperial~~the ~~County,~~move ~~California~~ to ~~support~~treat adata ~~300-megawatt~~as ~~(MW)~~an ~~critical~~asset, ITthe ~~load~~ data ~~center~~services ~~campus~~market ofis upexpected to ~~one~~experience ~~million~~significant ~~square~~growth ~~feet~~over ~~of rentable~~the ~~colocation~~next ~~space~~decade. Industry ~~utilizing~~automation ~~baseload~~and ~~geothermal~~digital ~~and~~businesses ~~supplemental~~are ~~solar~~expanding, ~~from~~and ~~local~~these ~~power~~businesses ~~producers.~~are ~~Our~~expected ~~site~~to isrequire ~~industrial~~huge ~~zoned, approved~~amounts ~~for~~of data ~~center~~for ~~use~~their businesses. ~~and~~North ~~today~~America ~~has~~is ~~access~~the tomost upadvanced toregion ~~500MW~~globally ofand ~~clean~~we ~~energy~~believe ~~that can be delivered~~ ready-to-build-on itdata ~~through~~center ~~two~~platforms ~~separate~~are ~~highly-reliable 230kV~~in high~~-voltage~~ ~~transmission lines~~demand.

In developing our master-planned, geothermal-powered data center campus, we have had numerous discussions with several large companies that could lease all or part of our data center campus, with the intention of cultivating long-term strategic relationships with these companies once they become our tenants and providing them with solutions for their data center facilities and IT infrastructure requirements. We initially intend to provide geothermal-powered building lots with flexibility for customers to scale for future growth. As currently contemplated, our ready-to-build-on platform will provide clean-energy power, flexibility, reliability and security delivered through a tailored, customer-service-focused offering that will be designed to foster long-term relationships. Our plan is to focus on technology and large cloud computing customers that are expanding their services rapidly in the public and private cloud environments to provide them with clean-energy-powered solutions that address their current and future needs. We expect that our clean energy, geothermal-powered building platform design will allow us to offer power resiliency, and the opportunity for expansion as the needs of our customers grow.

AtPlan ~~the end~~ of December 2023, we started Phase II of our data center development plan. Phase II includes hiring additional staff and consultants to complete environmental, health and safety and cyber security procedures and to develop a set of data center operating procedures to meet customer pre-qualification requirements. During this phase, we will also develop requests for proposals (RFPs) and contract packages for contracting an engineering/design firm and general contractor. In addition, we will ramp up our operating staff to support the infrastructure and buildings design processes and the development of building plans and the permit packages. We will also undertake and complete utility studies, transmission planning, substation design and the next level of geotechnical testing.Operations

~~Over~~As of the ~~next~~date ~~few~~of ~~months~~filing of this Report, we ~~plan~~are toin ~~complete~~the ~~our~~process ~~negotiations~~of ~~with~~completing ~~the~~our ~~local~~vertically-integrated, ~~grid~~geothermal-powered ~~operator~~data tocenter campus ~~deliver~~land-use ~~geothermal~~plan and ~~solar~~zone ~~power~~change towith ~~our~~ Imperial County ~~site~~Planning ~~directly~~and ~~from~~Development. ~~local~~We ~~producers~~expect ~~and~~that toland ~~have~~use ~~selected~~ and ~~contracted~~conditional ~~our~~zone change ~~architect/engineering~~approvals ~~firm~~will ~~and~~be ~~general contractor.~~completed Inby ~~addition,~~the weend ~~expect~~of ~~that~~2025 itor ~~will~~during ~~take~~the ~~three~~first toquarter ~~six~~of ~~months~~2026. toIn ~~complete~~parallel, ~~the~~we ~~necessary~~are ~~customer~~completing ~~pre-qualifications~~our ~~and~~plans, ~~basic~~timelines ~~infrastructure~~ and ~~building~~budgets ~~designs~~for all required tocounty ~~negotiate~~and astate ~~letter~~environmental ofstudies ~~intent~~and ~~with~~reports, awhich ~~customer~~we ~~that~~expect ~~will~~to ~~lease~~have ~~all~~completed ~~or a~~and ~~substantial~~filed ~~portion~~for ofdata ~~our~~center ~~planned~~campus ~~data~~construction, ~~center~~onsite ~~capacity.~~switchyard Weand ~~are~~electrical ~~currently~~distribution insystem, ~~discussions~~and ~~with~~fiber, agas, ~~number~~water ofand ~~companies~~sewer lines that ~~are interested~~connect into ~~leasing~~the ~~wholesale~~property ~~colocation~~by ~~space~~the ~~under~~end aof ~~long-term~~2025. ~~lease~~In ~~and~~addition, we are ~~entertaining~~planning ~~build-~~to~~-suit~~ ~~arrangements~~have ~~with~~the ~~a number~~required ofapprovals ~~potential~~to ~~customers.~~start ~~Based~~the initial ~~upon~~construction of the ~~interest~~data wecenter ~~have~~campus ~~received~~and ~~from~~all ~~potential~~external ~~customers,~~utility welines ~~expect~~by ~~that~~the weend ~~will~~of ~~have~~the asecond quarter ~~letter~~2026. ofWe ~~intent~~are ~~signed~~also byplanning ~~the~~that ~~end~~we ofcan ~~the~~complete ~~second~~and ~~quarter~~submit orall ~~the~~design, ~~beginning~~planning ofand ~~the~~environmental ~~third~~reports ~~quarter~~and ofstudies ~~2024~~for the tstate ~~lease~~environmental ~~all~~agencies orfor aour ~~substantial~~planned ~~part~~onsite ofgeothermal ~~the~~production ~~development~~systems by mid-2026.

We ~~plan~~ toare ~~start~~also in the ~~design~~ process ~~for~~of ~~our~~completing ~~initial~~a ~~data~~master ~~center~~services inagreement ~~the~~with ~~beginning~~a ofgeothermal ~~May~~technology ~~2024~~ and todevelopment ~~have~~company ~~plans~~that will provide advanced closed-loop geothermal production technology, sub-surface planning and ~~permit~~drilling, ~~packages~~above-ground ~~completed~~turbine and generator byelectricity production components and the ~~end~~electrical ofdistribution ~~2024.~~system Ifdesign ~~those~~and components. ofWe ~~Phase~~expect IIto ~~are~~complete ~~completed~~this asagreement before ~~planned,~~the weend ~~would~~of ~~then~~June ~~start~~2025 and have the ~~initial~~designs ~~phase~~completed offor ~~construction~~subsurface ~~in January~~and surface components before the end of 2025.

AsClosed-loop wegeothermal ~~move~~systems ~~through~~(also ~~the~~known ~~development~~as ~~process~~“advanced wegeothermal ~~will~~systems” ~~continue~~or to“AGS”) ~~refine~~are ~~and~~a ~~finalize~~type ~~the~~of ~~courses~~engineered ofgeothermal energy ~~action~~system ~~needed~~containing tosubsurface ~~implement~~working ~~our~~fluid ~~business plan~~that is heated in a hot rock reservoir without direct contact with rock pores and ~~operations~~fractures. Instead, Asthe subsurface working fluid stays inside a ~~result,~~closed ~~management~~loop ~~has~~of ~~not~~deeply ~~fully~~buried ~~determined~~pipes ~~our~~that ~~actual~~conduct ~~short-term~~Earth’s orheat. ~~long~~Closed-~~term~~loop geothermal ~~capital~~systems ~~requirements~~are ~~for~~one ~~our initial~~of ~~project,~~the ~~which~~prominent ~~management~~categories ~~expects~~of tonext-generation begeothermal ~~substantial~~systems in development today.

The ~~Data~~advantages ~~Center~~of ~~Industry~~closed-loop geothermal technologies include:

~~According to~~● aNo ~~March~~need ~~2023~~for ~~report of Prescient & Strategic Intelligence Pvt. Ltd.,~~ a ~~market~~geofluid ~~intelligence and consulting firm~~(water, ~~the~~geothermal ~~data center industry is large and on pace to grow rapidly~~brine, ~~from $263 billion in 2022 to over $602 billion in 2030~~etc.) ~~The industry~~● isNo ~~not~~need ~~only~~for ~~large,~~the ~~but~~hot ~~also~~rock ~~very profitable. According~~ to ~~Dgtl~~be ~~Infra~~permeable ~~LLC,~~or aporous ~~digital~~● ~~infrastructure~~All ~~advisory firm,~~ the ~~larger~~ ~~data~~introduced ~~center~~working ~~developer/operator~~fluids ~~companies~~can ~~average~~be ~~50%~~recirculated ~~EBITDA~~with onzero ~~lease~~loss ~~revenues.~~● ~~Those~~No ~~that~~fracking ~~are~~or ~~publicly~~stimulation ~~traded~~is ~~are~~required ~~valued~~to ~~at an~~establish ~~average~~the ofengineered 25geothermal ~~times EBITDA~~reservoir.

AThese ~~key~~advantages ~~metric~~mean ~~for the industry is the cost per kilowatt~~closed-~~of-power-per-month~~loop ~~($/kW/Mo.),~~geothermal ~~which~~systems ~~drives~~can ~~lease~~be ~~revenues.~~placed ~~According~~anywhere toin the ~~Evercore~~ ~~Digital~~world ~~Infrastructure~~as ~~Sector~~a ~~Update~~source ~~for the third quarter~~ of ~~2023 (the “Evercore Report”) of Evercore~~carbon-free, ~~a leading~~baseload ~~global independent investment bank~~energy, ~~hyperscale lease transactions (transactions involving the lease of 100MWs or more of~~with ~~data~~no ~~center~~impact ~~capacity)~~to innatural ~~the~~water ~~U.S.~~resources ~~are being consummated at $130/kW/Mo. or higher vs. $65-75 just three years ago,~~ and ~~some wholesale~~significantly ~~colocation~~reduced ~~customers~~risk ~~are~~of ~~paying~~induced ~~as high as $165/kW/mo~~seismicity.

~~Another~~In ~~key~~July ~~metric~~2024, inwe ~~the~~contracted ~~data~~to ~~center~~purchase ~~industry is the kilowatt (kW) of power~~315-~~per-data-center-rack~~acres ~~(the density~~ of ~~power~~land aand ~~cabinet~~are ofplanning ~~servers or~~to ~~data~~option ~~storage~~an ~~systems~~additional ~~consumes).~~320-acres ~~According~~in to the ~~Evercore~~next ~~Report,~~couple ~~historically,~~of ~~this~~months. We ~~metric~~believe ~~has~~the ~~averaged~~site ~~8-10kW~~we ~~per~~have ~~rack~~chosen ~~over~~to ~~the last~~develop ~~ten~~is ~~years.~~a ~~However,~~unique ~~because~~location ofthat ~~artificial~~will ~~intelligence~~provide ~~(AI)~~us ~~and~~with ~~other~~a ~~high~~rare ~~performance~~opportunity ~~computing~~to ~~(HPC)~~vertically ~~requirements~~integrate clean, ~~data~~onsite, ~~center rack~~baseload ~~power~~geothermal ~~densities~~energy ~~are~~with ~~climbing~~a ~~upwards~~24/7 ~~towards~~data ~~100kW~~center ~~per rack~~operation. ~~These~~We ~~higher~~believe ~~rack~~100% ~~densities~~clean-energy-powered ~~require~~data ~~liquid-cooled~~centers ~~systems~~are ~~rather~~an ~~than~~important ~~the~~element ~~conventional~~in ~~air-cooling~~the ~~methods~~ability ~~that~~of ~~have~~the ~~been~~U.S. ~~the~~to ~~standard~~meet ~~for~~its ~~decades.~~carbon ~~Based~~neutral onclimate angoals ~~average~~and ~~rack~~for ~~density~~hyperscale ofand ~~20-40kW~~enterprise ~~per~~IT companies ~~rack,~~to ~~data~~meet ~~center~~their ~~build~~shareholder ~~costs~~and ~~over~~customer ~~the~~climate ~~last~~commitments ~~two~~ to ~~four years~~ have ~~averaged~~a ~~$10~~compliant, toclean ~~$15~~digital ~~million~~footprint. ~~per~~As ~~megawatt.~~a ~~However~~result, ~~today,~~we ~~because~~believe the availability of ~~the~~nearby ~~new~~clean ~~power and~~geothermal ~~cooling~~energy ~~requirements,~~for ~~build~~our ~~costs~~Imperial ~~for~~County ~~data~~site ~~center~~will ~~developments~~provide ~~are~~us ~~projected~~with toa besignificant ~~more~~competitive advantage in the ~~range of $15 to $20 million per megawatt~~marketplace.

As a result of these changing dynamics, demand for data centers is intensive for both more facilities and greater power density. In the Evercore Report it was noted that during the third quarter of 2023, every data center under construction was pre-leased two to five years in advance of occupancy. The key constraint for the growth of data centers is the availability of power. However, in the Evercore Report, Evercore, noted that during the third quarter of 2023, on a nationwide basis, there was no availability of contiguous data center capacity above 10MW, and only three blocks of 5 MWs were available. To illustrate the power constraint, today’s data center developments start in increments of 100MW, while mega-campuses of 1GW or more are being planned.

To meet the growing demands of the digital world, it is projected by McKinsey & Company that the industry will increase energy consumption from 17GW today to over 35GW by 2030. This projected increase in demand for power has left data center developers and operators searching for electricity in any region with available power, land for construction and sufficient network bandwidth.

ASince ~~second~~mid-2022, ~~consideration~~we ishave ~~the~~contracted ~~environmental~~with ~~impact~~leading ofdata ~~power~~center ~~generation~~ and ~~use.~~energy ~~Sustainability~~advisory ~~regulations~~firms ~~are projected~~ to ~~become~~complete ~~more difficult to meet~~site, power and itconnectivity ~~is expected that using renewable energy credits (RECs) to offset carbon footprints of conventional power sources~~assessments, ~~will~~feasibility nostudies, ~~longer~~engineering ~~qualify. Today~~plans, ~~less~~master-planned ~~than~~development 5%and ofdesign, ~~the~~and ~~energy~~project ~~powering~~benchmarking. ~~data~~These ~~centers~~have isincluded ~~clean.~~engaging:

~~Competition~~● HDR Engineering, Inc., a global professional services firm specializing in architecture, engineering, environmental and construction services (“HDR Engineering”), to complete a site assessment, project feasibility study, and the initial shovel-ready site development plan for our master planned data center campus. ● ZGlobal, Inc., a power engineering and energy solutions firm (“ZGlobal”), to assess all available power and transmission routes in the immediate area of the site and to develop a plan to access power from close by geothermal and solar producers via Behind-The-Meter, Off-Take and Power Purchase Agreements directly and through agreements with the local grid operator. ● American Dark Fiber, Inc., a provider of dark fiber connectivity to municipalities, carriers, anchor institutions, content developers, data-center operators, and other sophisticated private network users, to develop a robust fiber-based infrastructure that will provide multiple diverse geographic routes of connectivity to our data center site. ● Linesight, a construction consultancy services firm (“Linesight”), to provide cost benchmarking of initial design concepts, and to assist with desktop pre-qualification of architect-engineering firms and construction managers.

~~The~~Based ~~competition~~on in the ~~data~~project ~~center industry is primarily driven by the increasing presence of small- and large-scale service providers globally~~assessment, ~~and~~ wefeasibility ~~will compete with numerous developers,~~ and ~~public~~initial ~~and private owners and operators of technology~~shovel-~~related~~ready ~~real~~site ~~estate~~plans ~~and~~that ~~data centers.~~have ~~The~~been ~~key~~developed ~~participants~~by inHDR ~~the data center colocation market are Digital Realty~~Engineering, ~~Equinix, CyrusOne, QTS,~~ and, ~~Vantage,~~the ~~Compass,~~benchmarking ~~among~~of ~~many~~the ~~others.~~project Inby ~~addition,~~Linesight weagainst ~~may~~25 ~~face competition from~~ other ~~new~~large ~~entrants into the~~ data center ~~market.~~developments ~~Many~~in ofthe ~~our~~U.S. ~~current and potential competitors may have significant advantages~~ over ~~us,~~the ~~including~~last ~~greater~~24 ~~name recognition~~months, ~~longer~~we ~~operating~~plan ~~histories,~~to ~~pre-existing~~develop our ~~relationships~~635-acre ~~with~~site ~~current~~in orImperial ~~potential customers~~County, ~~significantly~~California ~~greater~~to ~~financial,~~support ~~marketing~~up ~~and~~to ~~other~~three ~~resources,~~million ~~ownership~~square feet of ~~more~~ data ~~centers~~center ~~and~~facilities ~~data centers~~ that ~~are~~utilize ~~more~~2 ~~broadly~~gigawatts or ~~distributed geographically, access to less expensive power, and~~ more ~~robust interconnected hubs in certain geographic markets. All~~ of ~~these~~baseload ~~potential~~geothermal ~~advantages could allow competitors to respond more quickly to new or changing opportunities~~power. InOur ~~addition,~~site ~~once~~will webe ~~are~~zoned ~~operational,~~medium-industrial ifthat ~~our~~is ~~competitors~~approved ~~offer~~for ~~space,~~geothermal power production and~~/or~~ ~~interconnection services at rates below~~data ~~current~~center market rates, or below the rates we are then charging our customers, we may lose potential customers or be pressured to reduce our rental rates below those we are then charging or have modelled in order to retain customers when our customers’ leases expireuse.

As awe ~~new~~move ~~entrant~~through ~~into~~ the ~~data~~development ~~center marketplace~~process, we will ~~compete~~continue ~~against~~to ~~the~~refine ~~larger, more established~~ and ~~better~~finalize ~~capitalized companies that today control~~ the ~~majority~~courses of ~~market~~action ~~share.~~needed Weto ~~believe~~implement our ~~principal advantages will be our location, which provides us with access~~business toplan ~~an abundance of reasonably-priced local baseload geothermal~~ and ~~supplemental~~operations. ~~solar~~As ~~energy to power~~ a ~~24/7 data center operation~~result, ~~low-latency connectivity~~our tomanagement ~~major~~has ~~market~~not ~~hubs,~~fully ~~the~~determined ~~various~~our ~~power~~actual ~~distribution~~short-term ~~and~~or ~~cooling~~long-term ~~designs~~capital ~~that~~requirements ~~we will employ to support a wide range of~~for ~~data~~our ~~center~~initial ~~racking densities~~project, ~~and~~which ~~our~~management ~~proximity~~expects to ~~the~~be ~~Southern California market and the multitudes of companies utilizing high-performance computing that want close-by data center space~~substantial.

As a developer of clean-energy powered data center space, we also compete for the services of key third-party service providers, including engineers and contractors with expertise in the development of data centers. The ~~competition for the services of specialized contractors~~ ~~and~~Data ~~other~~Center ~~third-party providers required for the development of data centers is intense, increasing the cost of engaging such providers and the risk of delays in completing our development projects.~~Industry

~~Finally,~~Demand wefor ~~face~~data ~~competition~~centers ~~from~~is ~~real~~intense ~~estate~~for ~~developers~~both inmore ~~our~~facilities ~~sector~~ and ingreater ~~other~~power ~~industries~~availability. ~~for~~Based ~~the~~on ~~acquisition~~several ofreports ~~additional~~from ~~properties~~CBRE, ~~suitable~~JLL and other ~~for~~research firms, the data center ~~development.~~industry ~~Such~~is ~~competition~~forecasting ~~may~~that ~~reduce~~data center capacity will triple within the ~~number~~next offive ~~properties~~years. ~~available~~In ~~for~~the ~~acquisition~~fourth quarter orof ~~development~~2024, ~~increase~~every data center under construction was pre-leased from two to five years in advance of occupancy. It is widely acknowledged that the ~~price~~key constraint for the growth of ~~these~~data ~~properties~~centers ~~and~~is ~~reduce~~the availability of power. To illustrate the power demand, ~~for~~today’s data center ~~space~~developments start in ~~the~~increments ~~markets~~of we100MW, ~~seek~~while tomega-campuses ~~serve~~of 1GW or more are currently in construction.

According to a recent report by Bloom Energy, the “2025 Data Center Power Report”, demand for power in the U.S. is growing at an unprecedented rate after 20 years of flat demand. U.S. power needs are projected to rise by 83 terawatt-hours (TWh) in 2025 – the equivalent to powering an additional 7.7 million homes. According to such report, data centers are the largest driver of this growth. The U.S. is expected to see the highest share of new data centers outside of China. Since 2020, the U.S. colocation data center market alone has doubled, driven by digitization, cloud and AI. To power this increase, it was reported that by 2030, data centers could require 8%-12% of the total U.S. power demand compared to 3%-4% today.

The U.S. grid has not been able to keep pace with this demand. While utilities can likely generate sufficient power to meet data center needs, they face bottlenecks with transporting that power via transmission and distribution infrastructure. As a result, grid interconnection takes longer, there is more congestion on the network, and capacity is increasingly expensive. If the U.S. continues to build high-voltage transmission infrastructure at its current rate, it is estimated that it will take at least 80 years to deliver the power that is needed over the next decade.

Bloom Energy believes new data center projects will struggle to get timely access to power. In the U.S., 55 GW of data center IT capacity is expected to come online in the next five years. The industry is already seeing data center IT capacity buildout ramp up with ~20 GW of capacity announced so far for 2025, and it is expected to continue growing. Bloom Energy expects that at least another 35 GW of data center capacity will be announced within the next five years to meet projected data center demand.

In addition, the environmental impact of power generation and use is expected to become more stringent. Sustainability regulations are expected to become more difficult to meet, and it is expected that the use of renewable energy credits (RECs) to offset carbon footprints of conventional data center power sources will no longer qualify. Today, less than 5% of the energy directly powering data centers is clean.

According to the 2024 United States Data Center Energy Usage Report “Energy Analysis and Environmental Impacts Division, Lawrence Berkeley National Laboratory,” energy consumption by U.S. data centers has been on the rise and reached 280 terawatt hours (TWh) in 2024 accounting for an estimated 5% to 6% of the nation’s total electricity usage. Projections for data center energy consumption by 2028 range from 325 TWh to 580 TWh. This annual usage would correspond to a power demand for data centers of between 74 GW and 132 GW, which equates to 6.7% to 12.0% of the anticipated total U.S. electricity consumption for 2028.

According to a report by P & S Intelligence, a market research firm, the data center industry is large and on pace to grow rapidly, from $282 billion in 2024 to over $602 billion in 2030. The industry is not only large, but also very profitable. According to the Dgtl Infra report “Data Center REITs, Stocks and ETFs: Investing in 2024”, in February 2024, the principal data center developer/operator companies averaged EBITDA margins of 50% or more on lease revenues. Those that are publicly traded were valued at an average of 25 times EBITDA.

According to a February 2025 report by PwC (Pricewaterhouse Coopers LLP) on the “Economic Contributions of Data Centers in the United States,” data centers have become vital to the modern economy, underpinning digitalization, facilitating data driven decision-making, and supporting a broad spectrum of industries and services. Their role in storing, processing and managing data is essential for organizational success in the digital age.

According to the PwC report, the total annual contribution of the data center industry to national employment - encompassing direct, indirect and induced effects from data center construction and operations - has increased from 2 .9 million jobs in 2017 to 4 .7 million jobs in 2023, marking a 60 percent rise over this period. The industry’s growth has notably surpassed that of the overall U. S. economy in recent years. From 2017 to 2023, direct employment in the U. S. data center industry expanded by over 50 percent, compared to 10 percent growth in employment for the United States overall during the same timeframe.

According to PwC, the industry’s total annual contribution to national labor income surged from $209 billion in 2017 to $404 billion in 2023, reflecting a 93 percent increase. The increase in labor income has outpaced the increase in employment, suggesting that the U. S. data center industry supports higher earning jobs at the national level. Additionally, its annual contribution to U. S. value added, or gross domestic product (GDP), rose from $355 billion in 2017 to $727 billion in 2023, marking a 105% increase. Over this same period, the U. S. GDP grew by only 41 percent.

Geothermal Energy

According to a December 2024 IEA (International Energy Agency) report “The Future of Geothermal Energy,” technology breakthroughs are unlocking huge potential for geothermal energy. New geothermal harvesting technologies are enabling access to previously untapped resources, while cost reductions and innovative financing models are paving the way for increasing the role of geothermal energy in energy systems around the world. Additionally, techniques developed by the oil and gas industry – including a strong understanding of the subsurface, drilling and completing wells, predicting fluid flows and managing large-scale projects – can rapidly drive down costs and help tap geothermal resources deeper in the ground.

Advances in technology are opening new horizons for geothermal energy, which is expected to make it an attractive option for countries and companies all around the world. These techniques include horizontal drilling and hydraulic fracturing honed through oil and gas developments in North America. If geothermal can follow in the footsteps of innovation success stories such as solar photovoltaic (PV), wind, EVs and batteries, it can become a cornerstone of tomorrow’s electricity and heat systems as a dispatchable and clean source of energy. For the moment, geothermal meets less than 1% of global energy demand and its use is concentrated in a few countries with easily accessible and high-quality resources, including the United States, Iceland, Indonesia, Turkey, Kenya and Italy.

According to the IEA report, with continued technology improvements and reductions in project costs, geothermal could meet up to 15% of global electricity demand growth by 2050. This would mean the cost-effective deployment of as much as 800 GW of geothermal power capacity worldwide, producing almost 6,000 terawatt-hours per year, which is equivalent to the current electricity demand today of the United States and India combined.

Geothermal is a versatile, clean and secure energy source that can provide around-the-clock electricity generation, heat production and storage. As the energy source is continuous, geothermal power plants can operate at their maximum capacity throughout the day and year. On average, global geothermal capacity had a utilization rate over 75% in 2023, compared with less than 30% for wind power and less than 15% for solar PV. In addition, geothermal power plants can operate flexibly in ways that contribute to the stability of electricity grids, ensuring demand can be met at all times and supporting the integration of variable renewables such as solar PV and wind.

According to the IEA report, investment in geothermal is growing. Governments, oil and gas companies and utilities are among those looking for investment opportunities in geothermal. If deep cost reductions for next-generation geothermal can be delivered, total investment in geothermal could reach $1 trillion cumulatively by 2035 and $2.5 trillion by 2050. At its peak, geothermal investment could reach $140 billion per year, which is higher than current investment in onshore wind power globally. As a dispatchable source of clean power, geothermal is also attracting interest from stakeholders beyond the energy industry, including technology companies looking to meet the fast-growing demand for electricity in data centers.

Competition

The competition in the data center industry is primarily driven by the increasing presence of small- and large-scale service providers globally, and we will compete with numerous data center developers, and public and private owners and operators of technology-related real estate and data centers.

The key participants in the data center market with which we will compete are infrastructure developers, such as Tract, ScaleUp, Stream, Quantum Loophole and Cloverleaf Infrastructure, and data center companies such as Digital Realty, Equinix, CyrusOne, QTS, Vantage and Compass, among many others. In addition, we may face competition from other new entrants into the data center market. Many of our current and potential competitors may have significant advantages over us, including greater name recognition, longer operating histories, pre-existing relationships with current or potential customers, significantly greater financial, marketing and other resources, ownership of more data centers and data centers that are more broadly distributed geographically, access to less expensive power, and more robust interconnected hubs in certain geographic markets. All of these potential advantages could allow competitors to respond more quickly to new or changing opportunities. In addition, once we are operational, if our competitors offer space, power and/or interconnection services at rates below current market rates, or below the rates we are then charging our customers, we may lose potential customers or be pressured to reduce our rental rates below those we are then charging or have modelled in order to retain customers when our customers’ leases expire.

As a new entrant into the data center marketplace, we will compete against the larger, more established and better capitalized companies that today control the majority of market share. We believe our principal advantages will be our location, which provides us with access to an abundance of reasonably-priced onsite baseload geothermal energy to power a 24/7 data center operation, low-latency internet connectivity to major market hubs, and our proximity to the Southern California market and the multitudes of companies utilizing high-performance computing that want close-by data center space.

As a developer of data center infrastructure, we also compete for the services of key third-party service providers, including engineers and contractors with expertise in the development of onsite power production and data centers. The competition for the services of specialized contractors and other third-party providers required for the development of onsite power production data centers is intense, increasing the cost of engaging such providers and the risk of delays in completing our development projects.

Finally, we face competition from real estate developers in our sector and in other industries for the acquisition of additional properties suitable for power production and data center developments. Such competition may reduce the number of properties available for acquisition or development, increase the price of these properties and reduce the demand for data center space in the markets we seek to serve.

Intellectual Property

~~Our~~Currently, our intellectual property ~~will~~consists ~~consist~~ of ~~data~~the ~~center~~feasibility, ~~designs~~assessment, industry benchmarking and ~~systems~~shovel-ready site development plans that have been completed for ~~supporting,~~us ~~immersion~~by ~~and~~industry ~~liquid~~leading ~~cooled~~consulting ~~data~~firms ~~center~~over ~~systems~~the last two plus years. Our intellectual property portfolio will ~~that~~grow as we complete the development of our onsite geothermal power production systems that will ~~deploy~~be ~~for~~vertically ~~wholesale~~integrated ~~colocation~~with ~~services~~our ready-to-build-on, clean-energy ~~hyperscale~~powered ~~and~~data ~~enterprise~~center ~~IT customers~~campus. We intend to rely on a combination of patent, copyright, trademark and trade secret laws in the United States and other jurisdictions, as well as contractual protections, to protect our proprietary ~~service~~technology, ~~offerings~~methods and ~~data center management systems~~offerings. However, as of the date of this Report, we do not have any patents or registered trademarks.

We cannot provide any assurance that our proprietary rights with respect to our onsite geothermal power production systems vertically-integrated with our ready-to-build-on, clean-energy powered data center ~~designs~~campus, ~~systems~~and orthe services we will offer will be viable or have value in the future since the validity, enforceability and type of protection of proprietary rights in these industries are uncertain and continuingly evolving.

Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our design, systems and services or to obtain and use information that we regard as proprietary. Policing unauthorized use of our designs and services is difficult, and while we are unable to determine the extent to which piracy of our designs, systems and services will exist, intellectual piracy can be expected to be a persistent problem. In addition, the laws of some foreign countries do not protect proprietary rights to as great an extent as do the laws of the United States, and effective copyright, trademark, trade secret and patent protection may not be available in those jurisdictions. Our means of protecting our proprietary rights may not be adequate to protect us from the infringement or misappropriation of such rights by others.

Further, in recent years, there has been significant litigation in the United States involving patents and other intellectual property rights in the data center design, systems and service offerings and Internet-related data management industries. We can become subject to intellectual property infringement claims as the number of our competitors grows and our services overlap with competitive offerings. These claims, even if not meritorious, could be expensive to defend and could divert management’s attention from operating our business. If we become liable to third parties for infringing their intellectual property rights, we could be required to pay a substantial award of damages and to develop non-infringing design, systems and service offerings, obtain a license or cease providing the services that contain the infringing intellectual property. We may be unable to develop non-infringing data center design, systems and service offerings or obtain a license on commercially reasonable terms, if at all.

Employees

We currently have ~~four~~three full-time employees, ~~three~~two of whom are our executive officers~~, and one of whom is our VP of Data Center Development~~. None of our employees ~~are~~is represented by a collective bargaining agreement, and we have never experienced any work stoppage. We believe we have good relations with our employees.

Corporate History and Recent Developments

We were incorporated pursuant to the laws of the State of Nevada on March 20, 2002 under the name Integrated Brand Solutions Inc., and on February 6, 2006, we changed our name to Upstream Biosciences Inc. From 2006 to December 2009, our company operated as a biotechnology company, and from 2010 until May 2013, our company had no operating business. On July 11, 2013, we changed our corporate name to RealSource Residential, Inc. Our initial business strategy in 2013 was to engage in various real estate related businesses. However, in 2016 we disposed of all of our real estate and other assets and continued operations as a public “shell” company. On December 20, 2018, we changed our corporate name from RealSource Residential, Inc. to CalEthos, Inc.

On December 20, 2018, we changed our corporate name from RealSource Residential, Inc. to CalEthos, Inc. in connection with the implementation of a plan for building a chain of large-format cannabis retail superstores to serve the needs of the rapidly-growing Southern California market. Over the subsequent two-year period, management assembled a number of acquisitions for retail licenses, store leases and display agreements with numerous cannabis brands as part of executing its business plan. However, once the COVID 19 pandemic lockdowns hit in early 2020 and Federal legalization of cannabis did not materialize after the 2020 elections, funding for cannabis-related businesses became less available and by the end of 2020, we concluded it would be better to pursue other business opportunities for our public company. After months of research, we determined there was a sizable opportunity to develop and manufacture high-performance computer systems for the cryptocurrency mining industry. In March 2021, we created a new business plan to develop a five nanometer ASIC chip and bitcoin mining computer system in South Korea utilizing Samsung technology and foundry capacity.7

In early 2021, we determined there was a sizable opportunity to develop and manufacture high-performance computer systems for the cryptocurrency mining industry. In August 2021, in connection with a $3.5 million capital raise, our board of directors determined that we were no longer a shell company, as defined in Rule 12b-2 of the Exchange Act. During the development of our computer chip and system in Korea, we had also developed a plan to build a large-scale, clean-energy powered, containerized, immersion-cooled data center operation in Southern California to support the use of the systems we were developing for our company and for others. However, following the decline of the bitcoin market in early 2022, we decided to abandon our chip and system development efforts and we determined that we could develop a profitable business by offering wholesale data center colocation services to a larger customer base of hyperscale and enterprise IT companies.

In August 2021, we hired an experienced chief technology officer from the chip industry to lead our product development and in September 2021, we closed a convertible debt financing of $3.5 million to fund the initial phase of product development. In connection with such capital raise, our board of directors determined that we are no longer a shell company, as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). During the development of our computer chip and system in Korea, we had also developed a plan to build a large-scale, clean-energy powered, containerized, immersion-cooled data center operation in Southern California to support the use of the systems we were developing for our company and for others. However, following the decline of the bitcoin market in early 2022, we decided to abandon our chip and system development efforts and we determined that we could develop a profitable business by offering wholesale data center colocation services to a larger customer base of hyperscale and enterprise IT companies.

Item 1A.

Risk Factors.

We are a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this item.

Item 1B.

Unresolved Staff Comments.

None.

ITEM 1C.

Cybersecurity

Risk Management and Strategy

While we are in our early stages of our business plan, we regularly assess risks from cybersecurity threats, monitor our information systems for potential vulnerabilities and test those systems pursuant to ~~the~~ our cybersecurity processes and practices, which are integrated into our overall risk management system. As we progress with the development of our business plans, we plan to use various security tools designed to help us identify, investigate, resolve and recover from security incidents in a timely manner.

To date, cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected and we believe are not reasonably likely to affect our company, including our business strategy, results of operations or financial condition.

Governance

One of the key functions of our board of directors is informed oversight of our risk management process, including risks from cybersecurity threats. Our board of directors is responsible for monitoring and assessing strategic risk exposure, and our executive officers are responsible for the day-to-day management of the material risks we face.

We take a risk-based approach to cybersecurity and have implemented cybersecurity policies throughout our operations that are designed to address cybersecurity threats and incidents.

Our Chief Executive Officer is primarily responsible for assessing and managing our material risks from cybersecurity threats with assistance from third-party service providers and outside counsel, as needed.

Our Chief Executive Officer oversees our cybersecurity policies and processes, including those described in “Risk Management and Strategy” above. Our cybersecurity risk management program includes tools and activities to prevent, detect and analyze current and emerging cybersecurity threats, and plans and strategies to address threats and incidents.

Item 2.

Properties.

We do not own any real property. Our executive office is located at 11753 Willard Avenue, Tustin, California 92782, in the office of Michael Campbell, our Chief Executive Officer. We are not charged rent for the use of this space. We believe our existing facilities are sufficient for our current operations.

Item 3.

Legal Proceedings.

We know of no material active or pending legal proceeding against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation.

Item 4.

Mine Safety Disclosures.

Not Applicable.

PART II

Item 5.

Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Our common stock is listed for quotation on the ~~OTC~~OTCQB ~~Pink~~ Market under the trading symbol “~~BUUZ~~GEDC.”. Trading in our common stock in in the over-the-counter market has been limited and the quotations set forth below are not necessarily indicative of actual market values. The following table sets forth, for the periods indicated, the high and low closing bid prices for each quarter within the last two fiscal years ended December 31, ~~2023~~2024 as reported by the quotation service operated by the OTC Markets Group. All quotations for the ~~OTC~~OTCQB ~~Pink~~ Market reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

Quarter Ended	High		Low
December 31, 2023	$	1.00	$	0.50
December 31, 2024	$	6.00	$	1.40
September 30, 2024		6.00		3.50
June 30, 2024		3.50		2.62
March 31, 2024		13.50		0.75
December 31, 2023		1.00		0.50
September 30, 2023		0.50		0.50
June 30, 2023		0.74		0.50
March 31, 2023		0.74		0.50
December 31, 2022		2.46		1.06
September 30, 2022		2.50		1.80
June 30, 2022		2.80		1.70
March 31, 2022		2.95		1.96

On ~~April~~March 128, ~~2024~~2025, the closing bid price for our common stock on the ~~OTC~~OTCQB ~~Pink~~ Market as reported by the quotation service operated by ~~the~~ the OTC Markets Group was $20.6291.

Transfer Agent

Nevada Agency and Transfer Company is the registrar and transfer agent for our common shares. Their address is 50 West Liberty, Suite 880 Reno, Nevada, 89501 Telephone: 775-322-0626, Facsimile: 775-322-5623.

Holders of Our Common Stock

As of March 3028, ~~2024~~2025, there were 6760 registered holders of record of our common stock. As of such date, 25,~~330~~730,540 shares of common stock were issued and outstanding. The number of our shareholders of record excludes any estimate by us of the number of beneficial owners of shares held in street name, the accuracy of which cannot be guaranteed.

Dividend Policy

We have not declared or paid any cash dividends since inception. Although there are no restrictions that limit our ability to pay dividends on our common shares, we do not intend to pay dividends for the foreseeable future.

Item 6. Selected Financial Data.

We are a “smaller reporting company” as defined by Regulation S-K and as such, are not required to provide the information contained in this item pursuant to Regulation S-K.

Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operation.

The following discussion should be read in conjunction with our audited financial statements and the related notes that appear elsewhere in this ~~Annual report~~Report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our ~~actual~~ actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include those discussed below and elsewhere in this ~~Annual~~ Report.

Our audited financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.

~~Plan~~We are in the early stages of ~~Operations~~implementing our plan for the development of a large-scale geothermal-powered data center campus on which we will lease powered building lots and buildings to large enterprise information technology (IT) customers that are creating or addressing the growing demand for AI, Cloud and High-Performance Computing (HPC) digital services. In planning for our initial geothermal-powered data center building lots and building, we are in discussions with several large companies that could lease all or part of the data center campus, with the intention of cultivating long-term strategic relationships with them once they become our customers and providing them with solutions for their data center facilities and IT infrastructure requirements. We initially intend to provide geothermal-powered building lots with flexibility for customers to scale for future growth. As currently contemplated, our offerings will provide clean energy power, flexibility, reliability and security delivered through a tailored, customer-service-focused platform that will be designed to foster long-term relationships.

ItAs isof the ~~intention~~filing of ~~our~~this ~~board~~Report, ofwe ~~directors~~have ~~for~~completed Phase I and entered into Phase II of our ~~company~~data tocenter ~~pursue~~development plans. In the ~~development~~initial phase of ~~the~~our project, we originally signed an option agreement in March 2023 to acquire 80 acres of commercially-zoned land in Imperial County, California ~~that~~. weWe ~~recently~~believed ~~put~~this ~~under~~site would provide us an ~~exclusive~~opportunity ~~option~~to ~~agreement~~acquire ~~and~~commercially-zoned ~~develop~~land iton ~~for~~which awe ~~large-scale,~~could ~~100%~~combine nearby direct clean geothermal/solar~~-powered,~~ ~~certifiable clean~~ energy, with a 24/7 data center operation. ~~that~~However, ~~will~~in ~~utilize~~July ~~immersion~~2024, we identified and ~~liquid~~entered ~~cooled~~into an ~~and~~option ~~conventional~~agreement ~~energy~~to ~~efficient~~acquire ~~data~~a ~~center~~larger, ~~systems and~~315-acre ~~provide~~parcel ~~colocation~~of ~~services~~land tothat ~~enterprise~~we ITbelieve ~~customers.~~provides us with significant advantages over our prior data center development site, which include:

~~To implement~~● ~~our~~Larger, ~~plan~~strategically located, weindustrial-zoned ~~have~~property ~~optioned~~with ~~the~~acreage ~~land~~for ~~and~~on-site ~~hired~~switchyard, ansubstation ~~experienced~~and additional data center ~~builder~~buildings ~~and~~● ~~operator~~Better ~~and~~options wefor ~~are~~connectivity ~~now~~to inhigh-voltage ~~the~~transmission ~~process of~~lines ~~acquiring~~● ~~the~~Closer ~~other~~proximity ~~principal~~to ~~ingredients~~existing ~~needed~~and ~~for~~planned ~~our~~geothermal ~~data~~power ~~center~~plants ~~operation~~● –Shorter ~~clean energy and~~ fiber ~~connectivity.~~routing Todistances ~~this end,~~to ~~over~~internet ~~the~~backbone ~~next~~and ~~couple~~communications ofnetworks ~~months,~~● weDirectly ~~plan~~on tothe ~~finish~~main ~~negotiations~~north/south ~~with~~transportation ~~local~~corridor ~~geothermal~~(Hwy. 111) and ~~solar~~gateway ~~power~~entrance ~~producers~~(Sinclair Rd.) to ~~deliver~~the ~~clean energy~~planned ~~for our operation~~51,000-acre ~~and~~Lithium toValley ~~complete~~development ~~agreements~~area ~~with~~● ~~multiple~~Lower ~~communication~~flood ~~providers~~risk ~~for~~- ~~access~~outside toof ~~their~~the ~~close~~100-by ~~long~~and 500-~~haul~~ ~~and dark~~year ~~fiber~~flood ~~communication~~zones ~~networks~~in ~~for~~a ~~connectivity.~~FEMA X (Unshaded) area

WeIn ~~are~~late ~~also~~July in2024, ~~the process of developing partnerships with leading-edge containerized and modular immersion and liquid cooled data center system providers whose systems~~ we ~~will~~terminated ~~offer~~our ~~for~~option ~~rent~~agreement to ~~our~~acquire ~~customers. We believe that, when construction of our data center is complete,~~ the ~~principal~~80-acre ~~differentiators~~parcel ~~of our data center operations~~ in ~~the~~Imperial ~~marketplace~~County, ~~are~~California ~~expected~~as ~~to be that~~ we ~~are~~believe ~~powered~~the ~~by 100% certified clean energy and that we provide leading~~recently-~~edge immersion and liquid cooled energy-efficient data~~optioned ~~center~~property ~~systems~~is ~~that~~better ~~will~~suited ~~support~~for ~~the~~our ~~ever-increasing~~immediate ~~power and cooling~~ needs ~~of high-performance enterprise IT computer systems~~.

ItWe isbelieve ~~anticipated~~100% ~~that~~clean-energy-powered wedata ~~will~~centers ~~incur~~are ~~expenses~~an inimportant ~~the~~element ~~implementation~~in of the ~~business~~ability ~~plan described herein, and such expenses will require substantial financing to complete the development~~ of the ~~property for a data center operation and to achieve our goals~~U. The failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our development plans, any commercialization efforts or other operationsS. ~~We may not be able~~ to ~~secure financing on favorable terms, or at all, to~~ meet ~~our~~ ~~future~~its ~~capital~~carbon ~~needs.~~neutral ~~In addition, even if we are able to obtain sufficient funding to commence our business operations, we may need~~climate togoals ~~pursue additional financing in the future to make expenditures~~ and~~/or~~ ~~investments~~for tohyperscale ~~support the growth of our business~~ and ~~may~~enterprise ~~require additional~~IT ~~capital~~companies to ~~pursue~~meet ~~our~~their ~~business~~shareholder ~~objectives~~ and ~~respond~~customer commitments to ~~new~~have ~~competitive~~an ~~pressures~~ESG-compliant, ~~pay extraordinary expenses or fund our~~clean ~~growth,~~digital ~~including~~footprint ~~through~~before ~~acquisitions~~2030. ~~Additional~~As ~~funds,~~a ~~however~~result, ~~may not be available when~~ we ~~need~~believe ~~them~~the onavailability ~~terms~~of ~~that~~nearby ~~are~~clean ~~acceptable to~~energy ~~us,~~and ~~or at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it,~~ our ability to ~~commence our proposed business operations,~~ to ~~continue~~produce togeothermal power ~~grow~~on ~~and support~~ our ~~business~~site ~~and~~will toprovide ~~respond~~us toa ~~business~~significant ~~challenges~~competitive ~~could be~~advantage ~~significantly~~in ~~limited~~the marketplace.

In Phase I of our development plan, which we completed in December 2023, we contracted with leading data center advisory firms to complete site, power and connectivity assessments, feasibility studies, engineering plans and project benchmarking. Phase I of our plan included engaging:

	●	HDR Engineering, Inc., a global professional services firm specializing in architecture, engineering, environmental and construction services (“HDR Engineering”), to complete a site assessment, project feasibility study, and the initial shovel-ready site development plan for our Imperial County site.

	●	ZGlobal, Inc., a power engineering and energy solutions firm (“ZGlobal”), to assess all available power and transmission routes in the immediate area of the site and to develop a plan to access power from close by geothermal and solar producers via Behind-The-Meter, Off-Take and Power Purchase Agreements directly and through agreements with the local grid operator.

	●	American Dark Fiber, Inc., a provider of dark fiber connectivity to municipalities, carriers, anchor institutions, content developers, data-center operators, and other sophisticated private network users, to develop a robust fiber-based infrastructure that will provide multiple diverse geographic routes of connectivity to our data center site.

	●	Linesight, a construction consultancy services firm (“Linesight”), to provide cost benchmarking of initial design concepts, and to assist with desktop pre-qualification of architect-engineering firms and construction managers.

During the beginning of 2024, we started Phase II of our data center development plan. Phase II included hiring additional staff and consultants to complete environmental, health and safety and cyber security procedures and to develop a set of data center operating procedures to meet hyperscale customer pre-qualification requirements. During this phase, we also developed requests for proposals (RFPs) and contract packages for contracting an engineering/design firm and general contractor. In addition, we ramped up our operating staff to support the infrastructure and building design processes and the development of building plans and the permit packages. We also undertook and completed utility studies, transmission planning, site layouts and substation designs.

We are currently in the process of completing our vertically-integrated, geothermal-powered data center campus land-use plan and zone change with Imperial County Planning and Development. We expect that land use and conditional zone change approvals will be completed by the end of 2025 or during the first quarter of 2026. In parallel, we are completing our plans, timelines and budgets for all required county and state environmental studies and reports, which we expect to have completed and filed for data center campus construction, onsite switchyard and electrical distribution system, and fiber, gas, water and sewer lines that connect to the property by the end of 2025. In addition, we are planning to have the required approvals to start the initial construction of the data center campus and all external utility lines by the end of the second quarter 2026. We are also planning that we can complete and submit all design, planning and environmental reports and studies for the state environmental agencies for our planned onsite geothermal production systems by mid-2026.

We are also in the process of completing a master services agreement with a geothermal technology and development company that will provide advanced closed-loop geothermal production technology, sub-surface planning and drilling, above-ground turbine and generator electricity production components and the electrical distribution system design and components. We expect to complete this agreement before the end of June 2025 and have the designs completed for subsurface and surface components before the end of 2025.

Based upon the current interest we have received from potential tenants, we expect that we will have agreements signed to lease all or a substantial part of the development by the end of 2025 or early 2026.

It is anticipated that we will incur significant expenses in the implementation of our business plan as described herein, and that we will require substantial financing to complete the development and construction of the planned vertically-integrated, geothermal-powered data center campus. A failure to obtain this necessary capital when required on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our development plans, any commercialization efforts and any other operations. We may not be able to secure financing on favorable terms, or at all, to meet our future capital needs. In addition, even if we are able to obtain sufficient funding to commence our business operations, we may need to pursue additional financing in the future to make expenditures and/or investments to support the growth of our business. In addition, we may require additional capital to pursue our business objectives and respond to new competitive pressures, pay extraordinary expenses or fund our growth, including through acquisitions. Additional funding, however, may not be available when required on terms that are acceptable to us, or at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when it is required, our ability to commence and grow our proposed business operations, to support our business and to respond to business challenges could be significantly limited.

We currently have only limited capital with which to pay these anticipated expenses. To fund our business plan going forward, we intend to raise funds from investors by issuing common stock, preferred stock and/or debt securities.

8Results of Operations for the years ended December 31, 2024 and 2023

~~Results~~The following table summarizes our results of ~~Operations~~operations for the years ended December 31, ~~2023~~2024 and ~~2022~~2023.

The following summary should be read in conjunction with our audited financial statements for the years ended December 31, 2023 and 2022.

							Change
	2024			2023			Dollar			Percentage
Revenues	$	-		$	-		$	-			-	%

Operating Expenses
Professional fees		386,000			344,000			42,000			12.2
Equity-based compensation		369,000			3,032,000			(2,663,000	)		(87.8	)
General and administrative		49,000			38,000			11,000			28.9
Development cost – abandonment		344,000			-			344,000			100.0
Payroll and related expenses		259,000			51,000			208,000			407.8
Total operating expenses	$	1,407,000		$	3,465,000		$	(2,058,000	)		(59.4	)%

Other (expenses) income
Interest income	$	12,000		$	50,000		$	(38,000	)		(76.0	)%
Financing cost		(2,410,000	)		(252,000	)		2,158,000			856.3
Gain on settlement of accounts payable		-			23,000			(23,000	)		(100.0	)
Loss on extinguishment of debt – related party		(2,317,000	)		-			2,317,000			100
Loss on extinguishment of debt		(6,468,000	)		(986,000	)		5,482,000			556.0
Total other expenses	$	(11,183,000	)	$	(1,165,000	)	$	10,018,000			859.9	%

	For the years ended December31,
	2023			2022
Revenues	$	-		$	-
Operating Expenses
Professional fees		344,000			667,000
Equity-based compensation (gain)		3,032,000			(4,791,000	)
Payroll and related cost		51,000			-
Impairment loss		-			154,000
General and administrative		38,000			52,000
Total operating expenses (income)		3,465,000			(3,918,000	)
(Loss) income from operations		(3,465,000	)		3,918,000
Financing costs		(252,000	)		(1,744,000	)
Gain on settlement of payable		23,000			-
Loss on extinguishment of debt		(986,000	)
Interest income		50,000			7,000
Total other expense		(1,165,000	)		(1,737,000	)
Net (loss) income	$	(4,630,000	)	$	2,181,000

Revenues

~~Revenue~~For the years ended December 31, 2024 and 2023, we had no revenues.

For the years ended December 31, 2023 and 2022, we had no revenues.

Operating Expenses

Professional fees

Our professional fees ~~decreased~~increased ~~from $667,000 for the year ended December 31, 2022~~ to $~~344~~386,000 for the year ended December 31, ~~2023, representing~~2024 afrom ~~decrease of approximately~~ $~~323,000. Our professional fees of $~~344,000 ~~is net of data center capitalized cost of approximately $80,000. Therefore, the actual professional fees incurred~~ for the year ended December 31, 2023~~, was approximately $424,000, a decrease of approximately $243,000~~. The increase ~~decrease~~ of approximately $~~243~~42,000 was attributable to a ~~$141,000~~decrease ~~reduction~~ in ~~the~~ ~~use~~our ofconsulting ~~outside contractors, a $110,000 reduction in legal~~ fees, ~~and~~of aapproximately $1763,000 ~~reduction in the overhead cost of our South Korean subsidiary~~, ~~for~~which awas ~~total of $268,000. These reductions were~~ offset by an ~~approximate $21,000~~ increase in ~~audit~~our ~~fees and a $4,000 increase in~~ other ~~expenses~~ ~~for~~professional afess ~~total~~ of approximately $25105,000.

Equity-based compensation ~~(gain)~~

Our equity-based compensation for the year ended December 31, ~~2023~~2024 iswas ~~attributable~~approximately to$369,000 ~~the~~as ~~stock~~compared ~~options and warrants issued~~ to ~~our officers~~$3,032,000 ~~directors~~for ~~and consultants during~~ the year ended December 31, 2023. ~~for~~During athe ~~total~~fourth ~~expense~~quarter of $32023,~~032,000.~~ ~~Information with~~we ~~respect~~issued warrants and stock options to ~~such~~our ~~equity-based~~directors ~~compensation~~and isofficers ~~set~~with ~~forth~~a infair value ~~Note~~of 7$2,916,000, towhich ~~our~~was ~~audited~~recognized ~~financial~~as ~~statements~~an expense upon issuance. Also for the ~~year~~years ended December 31, 2024 and 2023, ~~included~~the ~~elsewhere~~Company incapitalized ~~this~~equity ~~Report~~based compensation of approximately $2,380,000 and $336,000 as data center cost.

~~Our~~Development ~~equity-based~~cost ~~gain~~– in the year ended December 31, 2022 was attributable to equity-based compensation expense of approximately $6,377,000, which was offset by forfeitures of equity-based compensation of approximately $11,168,000.abandonment

~~Impairment~~On ~~loss~~July 24, 2024, we terminated our option agreement to acquire 80 acres of commercially-zoned land in Imperial County, California. At such date, we had approximately $344,000 development cost related to that property, which we determined were not usable for our data center campus project.

Our impairment loss of $154,000 in the year ended December 31, 2022 was due to the impairment of intangibles and other assets as a result of the suspension of our South Korean subsidiary’s operations.12

General and administrative expenses

Our general and administrative expenses decreased from $52,000 in the year ended December 31, 2022 to $38,000 in the year ended December 31, 2023, representing a decrease of approximately $14,000.

Payroll and related expenses

~~For~~Payroll and related expenses increased to $259,000 for the year ended December 31, ~~2022~~2024, wecompared ~~did~~to ~~not~~$51,000 ~~have~~for ~~employees~~the year ended December 31, 2023. For the year ended December 31, 2023, we had one employee. Our first employee, our Chief Operating Officer, was hired in ~~March~~June of 2023., and ~~The~~our ~~total~~second ~~payroll-related~~employee, ~~cost~~our ~~for~~Vice ~~this~~President ~~employee~~of ~~was~~Data ~~approximately~~Center ~~$226~~Development,~~000~~ ~~for~~was hired in February 2024. For the year ended December 31, ~~2023~~2024, our total payroll-related cost for our employees was approximately $1,148,000, of which approximately $~~175~~889,000 was capitalized as data center development cost.

Financing costs

Our financing cost for the year ended December 31, ~~2023,~~2024 ~~represented~~increased ~~interest~~to ~~expense~~$2,410,000 ofcompared ~~approximately~~to $252,000. ~~The total interest expense~~ for the year ended December 31, 2023 ~~was approximately $448,000, of which approximately $196,000 was capitalized as data center~~. ~~development~~The ~~cost.~~2024 ~~Our~~ financing cost ~~for~~included ~~the year ended December 31, 2022 represented interest expense of~~ $~~218~~2,~~000 and debt discount amortization of $1~~355,~~526,~~000, offor ~~which full amortized during~~ the ~~year~~amortization ~~ended December 31, 2022. The increase in interest expense~~ of ~~$230,000~~debt ~~for~~discount ~~the~~related ~~year ended December 31, 2023 was attributed~~ to ~~certain~~our ~~convertible promissory~~ notes ~~going into default during the year ended December 31, 2023~~payable.

~~Gain~~Loss on ~~settlement~~extinguishment of ~~payable~~debt – related party

During the year ended December 31, ~~2023~~2024, wethe ~~entered~~Company and the note holder agreed to convert the note payable of $1,000,000 into an500,000 ~~agreement~~shares of the Company’s common stock with a ~~vendor~~fair value of $875,000 and exchanged two warrants, previously issued to ~~reduce~~the note holder, each for 300,000 shares of the Company’s common stock (“Old Warrant”), for a warrant to purchase 2,258,877 shares of the Company’s common stock (“New Warrant’). The loss on extinguishment of $2,317,000 is difference between (i) $1,755,000 for the note payable byof ~~approximately~~$1,000,000 and fair value of Old Warrant of $23755,000 and (ii) $4,072,000 the fair value of the common stock of $875,000 and fair value of the New Warrant of $3,197,000.

Loss on extinguishment of debt

~~In December~~During ~~2023,~~the weyears ~~requested~~ended ~~the~~December ~~holders~~31, of2024 ~~our~~and ~~outstanding~~2023, ~~convertible~~the ~~promissory~~Company ~~notes~~extinguished toconvertible ~~convert~~debentures with ~~such~~the ~~promissory~~issuance ~~notes~~of ~~into~~ shares of ~~our~~the Company’s common stock. The ~~book~~fair value of the ~~promissory~~common ~~notes~~stock ~~and~~issued ~~accrued interest~~exceeds ~~was approximately $4,906,000, and~~ the ~~fair~~carrying ~~value~~ amount of the ~~common~~principal ~~stock~~and ~~was~~accrued interest by approximately $56,~~771~~468,000, ~~resulting~~and ~~in a loss on settlement of approximately~~ $~~865~~986,000~~. Also~~, ~~the~~which ~~holder~~was ofrecorded as a ~~$50,000~~loss ~~promissory~~on ~~note~~extinguishment ~~agreed~~for ~~to convert~~ the ~~principal and accrued~~ ~~interest~~year ofended ~~$67,000~~December ~~into shares of our common stock with a fair value of $188~~31,~~000,~~ ~~resulting~~2024 inand ~~a loss on settlement of approximately $121~~2023,~~000~~ respectively.

Liquidity and Capital Resources

Our ~~financial~~working ~~position~~capital as of December 31, in2024 ~~each~~and of2023 ~~the years indicated~~ was as follows:.

Working Capital

	2024			2023
Current assets	$	296,000		$	318,000
Current liabilities		(514,000	)		(1,022,000	)
Working capital deficit	$	(218,000	)	$	(704,000	)

	As of December 31,
	2023			2022
Current assets	$	318,000		$	2,071,000
Current liabilities		(1,022,000	)		(5,214,000	)
Working deficit	$	(704,000	)	$	(3,143,000	)

Our working capital deficit decreased from a $704,000 deficit as of December 31, 2023 to a deficit of $218,000 as of December 31, 2024 for a decrease of $486,000. The decrease in our working capital deficit was due to a $22,000 decrease in our cash and cash equivalents, which was offset by a decrease of $167,000 in our accounts payable and accrued expenses and a decrease of $341,000 in convertible promissory notes, net.

Our working capital decreased from a $3,143,000 deficit as of December 31, 2022 to a deficit of $704,000 as of December 31, 2023 for a total change of $2,439,000. The decline in our working capital was due to (i) a decrease in the book basis of our convertible promissory notes, for the December 2023 conversion and (ii) the decrease in our cash and cash equivalents, which was used for the data center development.

Cash Flows

	For the years ended December 31,
	2023			2022
	2024			2023
Net cash used in operating activities	$	(35859,000	)	$	(~~820~~35,000	)
Net cash used in investing activities		(1,~~730~~467,000	)		(~~105~~1,730,000	)
Net cash provided by financing activities		-2,305,000			~~(50,000~~-	)
Effect of exchange rate changes		6(1,000	)		(56,000	)
Change in cash during the period		(1,759,000	)		(980,000	)
Change in cash and cash equivalents during the period		(22,000	)		(1,759,000	)
Cash, beginning of period		2,067,000			3,047,000
Cash and cash equivalents, beginning of period		308,000			2,067,000
Cash, end of period	$	308,000		$	2,067,000
Cash and cash equivalents, end of period	$	286,000		$	308,000

Cash ~~flows~~Flows from ~~operations~~Operations

Cash used in operating activities ~~decreased~~increased to approximately $35859,000 infor ~~2023~~the year ended December 31, 2024 from approximately $~~820~~35,000 infor the ~~2022~~year ended December 31, 2023, which was predominantly related to the ~~reduction~~increase in our expenditures for filing fees, legal fees, transfer agent fees and consulting fees paid during the ~~year~~period.

~~Cash flow from investing~~13

~~Our~~Cash ~~cash~~Flows ~~used~~from ~~for investing activities was approximately $1,730,000 for the year ended December 31, 2023. The primary use of cash was for expenditures for the development of our data center.~~Investing

~~Cash~~Our ~~flows~~cash used in investing activities increased to approximately $1,467,000 for the year ended December 31, 2024 from ~~financing~~approximately $1,730,000 for the year ended December 31, 2023. The primary use of cash was for expenditures for the development of our data center campus.

~~For~~Cash ~~the~~Flows ~~year~~from ~~ended December 31, 2023, we had no financing activities.~~Financing

Our cash provided by financing activities increased to approximately $2,305,000 for the year ended December 31, 2024 from approximately nil for the year ended December 31, 2023. The increase of $2,305,000 was due to the issuance of a promissory note in the principal amount of $1,000,000 and the issuance of convertible debentures in the principal amount of $1,410,000 less $106,000 of cash paid for expenses related to the issuance.

Liquidity and Material Cash Requirements

~~Convertible~~Even ~~Promissory~~though ~~Notes~~we experienced negative cash flows from operations of approximately $859,000 for the year ended December 31, 2024, as a result of our private placement of a promissory note and convertible debentures in the principal amounts of $1,000,000 and $1,410,000, respectively, we had cash and cash equivalents of approximately $286,000 at December 31, 2024. As of December 31, 2024, we had approximately $1,410,000 of convertible debentures with maturity dates on December 31, 2026.

AsIt is anticipated that we will incur expenses in the implementation of ~~December~~our ~~31,~~business ~~2023~~plan described above, weand ~~had~~such ~~approximately~~expenses ~~$456,000~~will ~~outstanding~~require substantial ~~related~~financing to ~~our~~complete ~~convertible~~the ~~promissory~~development ~~notes~~of the property for a data center operation and ~~accrued~~to ~~interest~~achieve our goals. We currently Inhave ~~February~~only ~~2024,~~limited ~~the~~capital ~~total~~with ofwhich ~~$456,000~~to ~~was~~pay ~~converted~~these ~~into~~anticipated ~~shares~~expenses. ofTo fund our business plan going forward, we intend to raise funds from investors by issuing common stock, preferred stock and/or debt securities. We are currently in discussions with several potential funding sources. However, there can be no assurance we will be able to successfully raise additional funds when required, if at all.

~~Cash~~The ~~Requirements~~failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our development plans, any commercialization efforts or other operations. We may not be able to secure financing on favorable terms, or at all, to meet our future capital needs. In addition, even if we are able to obtain sufficient funding to commence our business operations, we may need to pursue additional financing in the future to make expenditures and/or investments to support the growth of our business and may require additional capital to pursue our business objectives and respond to new competitive pressures, pay extraordinary expenses or fund our growth, including through acquisitions. Additional funds, however, may not be available when we need them on terms that are acceptable to us, or at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to commence our proposed business operations, to continue to grow and support our business and to respond to business challenges could be significantly limited.

It is anticipated that we will incur expenses in the implementation of the business plan described above, and such expenses will require substantial financing to complete the development of the property for a data center operation and to achieve our goals. The failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our development plans, any commercialization efforts or other operations. We may not be able to secure financing on favorable terms, or at all, to meet our future capital needs. In addition, even if we are able to obtain sufficient funding to commence our business operations, we may need to pursue additional financing in the future to make expenditures and/or investments to support the growth of our business and may require additional capital to pursue our business objectives and respond to new competitive pressures, pay extraordinary expenses or fund our growth, including through acquisitions. Additional funds, however, may not be available when we need them on terms that are acceptable to us, or at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to commence our proposed business operations, to continue to grow and support our business and to respond to business challenges could be significantly limited.

Going Concern

The audited financial statements included in this Report have been prepared on a going concern basis, which implies that our company will continue to realize its assets and discharge its liabilities and commitments in the normal course of business. We are presently in the development stage and, apart from our cash balances, have only limited assets. Our company has not generated revenues in the last two fiscal years, has never paid any dividends and is unlikely to pay dividends or generate earnings in the immediate or foreseeable future. The continuation of our company as a going concern is dependent upon: (i) continued financial support from our shareholders; (ii) the ability of our company to continue raising necessary debt or equity financing to achieve its operating objectives; and (iii) our ability to acquire assets and establish a business or merge or otherwise acquire business opportunities.

Our independent auditors included an explanatory paragraph in their report on our financial statements for the year ended December 31, 2023 regarding concerns about our ability to continue as a going concern. In addition, our financial statements contain further note disclosures in this regard. The implementation of our business plan is dependent upon our ability to continue raising sufficient new capital from equity or debt markets in order to fund our on-going operating losses and real estate acquisition activities. The issuance of additional equity securities could result in a significant dilution in the equity interests of our current stockholders.

Application of Critical Accounting Policies

The preparation of financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying disclosures of our company. Although these estimates are based on management’s knowledge of current events and actions that our company may undertake in the future, actual results may differ from such estimates.

Principles of Consolidation

The consolidated financial statements include the accounts of our company and our wholly-owned subsidiary from the formation date. All material intercompany transactions and balances have been eliminated in consolidation.

Foreign Currency Translation

The financial statements of our foreign subsidiary, for which the functional currency is the local currency, are translated into U.S. dollars using the exchange rate at the consolidated balance sheet date for assets and liabilities and a weighted-average exchange rate during the year for revenue, expenses, gains and losses. Translation adjustments are recorded as other comprehensive income (loss) within shareholders’ equity (deficit). Gains or losses from foreign currency transactions are recognized in the consolidated statements of operations.

Debt and Debt Discounts

In accordance with ASC 470-20, Debt with Conversion and Other Options, we first allocate the cash proceeds of the notes between the notes and any warrants on a relative fair value basis. Proceeds are then allocated to the conversion feature.

We account for debt discounts originating in connection with conversion features that remain embedded in the related notes in accordance with ASC 470-20. These costs are classified on the balance sheet as a direct deduction from the debt liability. We amortize these costs over the term of our debt agreements as financing cost in the consolidated statement of operations and comprehensive loss.

Stock-Based Compensation

We account for our stock-based compensation under ASC 718, “Compensation – Stock Compensation” using the fair value based method. Under this method, compensation cost is measured at the grant date based on the value of the award and is recognized over the service period, which is usually the vesting period. This guidance establishes standards for the accounting for transactions in which an entity exchanges it equity instruments for goods or services. It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of those equity instruments.

We use the fair value method for equity instruments granted to non-employees and use the BSM model for measuring the fair value of options. The stock based fair value compensation is determined as of the date of the grant (measurement date) and is recognized over the vesting periods.

Recent Accounting Pronouncements

Our management reviewed all recently-issued accounting standard updates (“ASU’s”) not yet adopted by our company and does not believe the future adoptions of any such ASU’s may be expected to cause a material impact on our consolidated financial condition or the results of our operations.

Off-Balance Sheet Arrangements

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

Item 7A.

Quantitative and Qualitative Disclosures About Market Risk.

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide this information.

Item 8.

Financial Statements and Supplementary Data.

Our financial statements and notes thereto and the reports of RBSM LLP, our independent registered public accounting firm, are set forth on pages F-1 through F-1722 of this Report.

Item 9.

Changes In and Disagreements With Accountants On Accounting and Financial Disclosure.

Not Applicable

Item 9A.

Controls and Procedures.

Disclosure Controls and Procedures

As required by paragraph (b) of Rules 13a-15 or 15d-15 under the Exchange Act, our principal executive officer and principal financial officer evaluated our company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this Annual Report on Form 10-K. Based on this evaluation, these officers concluded that as of the end of the period covered by this Annual Report on Form 10-K, these disclosure controls and procedures were not effective.

The conclusion that our disclosure controls and procedures were not effective was due to the presence of material weaknesses in internal control over financial reporting as identified below under the heading “Management’s Report on Internal Control Over Financial Reporting.” Management anticipates that such disclosure controls and procedures will not be effective until the material weaknesses are remediated.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdown can occur because of simple error or mistake.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) for our company. Our internal control over financial reporting is designed to provide reasonable assurance, not absolute assurance, regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States of America. Internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles in the United States of America, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

1314

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions and that the degree of compliance with the policies or procedures may deteriorate.

Our management, including our principal executive officer and principal financial officer, conducted an evaluation of the design and operation of our internal control over financial reporting as of December 31, ~~2023~~2024 based on the criteria set forth in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. This evaluation included review of the documentation of controls, evaluation of the design effectiveness of controls, testing of the operating effectiveness of controls and a conclusion on this evaluation. Based on this evaluation, our management concluded our internal control over financial reporting was not effective as at December 31, ~~2023~~2024 due to the following material weaknesses which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines; (iii) inadequate security and restricted access to computer systems including insufficient disaster recovery plans; and

(iv) no written whistle-blower policy.

We plan to take steps to enhance and improve the design of our internal controls over financial reporting when our company has sufficient staff to allocate responsibilities. During the period covered by this Report, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we plan to implement the following changes once our financial resources will support the required staffing level: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; (ii) adopt sufficient written policies and procedures for accounting and financial reporting and a whistle-blower policy; and (iii) implement sufficient security and restricted access measures regarding our computer systems and implement a disaster recovery plan. The remediation efforts set out in (i) and (iii) are largely dependent upon our company securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely effected in a material manner.

This Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Our internal control over financial reporting was not subject to attestation by our independent registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this Report.

Changes In Internal Control Over Financial Reporting.

There were no changes in our internal control over financial reporting during the year ended December 31, ~~2023~~2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B.

Other Information.

None.

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PART III

Item 10.

Directors, Executive Officers and Corporate Governance.

Directors and Executive Officers

Our directors and executive officers, their ages and their positions held with our company are as follows:

Name	Age	Position(s) Held with the Company
Michael Campbell	6869	Chairman of the Board and Chief Executive Officer
Joel D, Stone	54	President and Chief Operations Officer
Joel D. Stone	55	President and Chief Operations Officer
Dean S. Skupen	6364	Chief Financial Officer
Steven Shum	5455	Director
Sean Fontenot	4145	Director

There are no arrangements between our directors and any other person pursuant to which our directors were nominated or elected for their positions. There are no family relationships among our directors or officers.

The following biographical information regarding our directors and executive officers.

Michael Campbell. Mr. Campbell became our Chief Executive Officer on September 12, 2018. For the past 20 years, Mr. Campbell has been the managing director of M1 Advisors LLC, a business advisory and consulting firm that has engineered, orchestrated and provided support and services to numerous private-to-public transitions, debt and equity financings and hyper- organic-growth and consolidation strategies in a wide range of industries. In addition, from December 2011 to February 2017, Mr. Campbell was the Chief Executive Officer and a director of NXChain, Inc., a publicly-traded start-up shell company in the cryptocurrency business that was a successor to AgriVest Americas Inc., a publicly-traded start-up shell company that sought to acquire cattle ranches in Brazil for conversion to soybean farms. Mr. Campbell spent the first 20 years of his career in the high-tech industry creating and operating various companies that included a computer retailing operation, data-storage peripheral company with three computer disk-drive manufacturing companies through joint ventures with the Russian, Chinese and Spanish governments, a specialized call-center company for telco broadband provisioning and an online broadband services ordering and order aggregation company with the Regional Bell Operating Companies.

Joel D. Stone. Mr. Stone became our President and Chief Operating Officer on March 28, 2023. Mr. Stone has 24 years of broad-based operations, engineering, construction, integration, transformation, and technical leadership in the data center infrastructure, sourcing, and telecommunications industries. Prior to joining our company, Mr. Stone led the Global Site Sourcing teams for Meta Platforms that supported the data center infrastructure teams from 2019 to 2022. Prior to 2019, Mr. Stone served as Senior Vice President and Chief Operating Officer of RagingWire Data Centers, an NTT communications company, where he was responsible for critical facilities engineering, design, construction, and data center operations from 2016-2018. Prior to RagingWire, Mr. Stone served as Vice President of Global Data Center Operations for CenturyLink Communications, responsible for 58 data centers around the world and a global team of 600+ people from 2011to 2016. Prior to CenturyLink, Mr. Stone was Group Operations Director at Global Switch in London, one of the largest wholesale data center providers in Europe and Asia. Mr. Stone spent nine years at Microsoft where he was responsible for all North America data center operations. Earlier in his career, Mr. Stone built-out two state-of-the-art data centers in Silicon Valley (Santa Clara) for Cable & Wireless Communications.

Dean S. Skupen. Mr. Skupen became our Chief Financial Officer on September 12, 2018. Mr. Skupen is a business advisor who has provided various financial accounting services to, or acted as the Interim Chief Financial Officer for, a number of public companies since 2010. Prior to that, he was a Partner at Stonefield Josephson, Inc. (now Marcum, LLP), an accounting firm with five offices throughout California where he provided auditing and consulting services to public companies and to privately-held entrepreneurial companies transitioning to public ownership in diverse industries. Mr. Skupen graduated from the University of Southern California with a Bachelor of Science degree in Accounting. In addition, he is licensed as a Certified Public Accountant in the State of California.

1516

Steven M. Shum. Mr. Shum became a director of our company on October 7, 2021. Mr. Shum has been Chief Executive Officer of INVO Bioscience (NASDAQ: INVO) since October 2019 and a member of the board of directors of INVO Bioscience since October 2017. Prior to INVO Bioscience, Mr. ~~Shun~~Shum served as Chief Financial Officer of Eastside Distilling (NASDAQ: EAST) from October 2015 to November 2019. Prior to joining Eastside, from October 2008 until April 2015, Mr. Shum was an employee and a member of the board of directors of XZERES Corp. (OTCQB:XPWR), a global renewable energy company, ~~from~~ ~~October 2008 until April 2015,~~ where he served in various officer roles, including Chief Operating Officer from September 2014 until April 2015, Chief Financial Officer, Principal Accounting Officer and Secretary from April 2010 until September 2014 (under former name, Cascade Wind Corp) and Chief Executive Officer and President from October 2008 to August 2010. Mr. Shum also serves as the managing principal of Core Fund Management, LP and the Fund Manager of Core Fund, LP. He was a founder of Revere Data LLC (now part of Factset Research Systems, Inc.) and served as its Executive Vice President for four years, heading up the product development efforts and contributing to operations, business development, and sales. He spent six years as an investment research analyst and portfolio manager of D.N.B. Capital Management, Inc. His previous employers include Red Chip Review and Laughlin Group of Companies. He earned a B.S. in Finance and a B.S. in General Management from Portland State University in 1992.

Sean Fontenot. Mr. Fontenot became a director of our company on October 7, 2021. Mr. Fontenot has spent more than 20 years as a self-employed IT and network specialist and in 2017 became an executive producer of independent films. Mr. Fontenot is a technology enthusiast and film producer that manages a 5013c foundation dedicated to (i) educating the public on the history of video, arcade, and computer gaming - including the technical aspects and the impact of games on society; (ii) fostering public interest in software development and gaming hardware to enable technological growth and inspire the next generation of developers, and (iii) developing public space for action sports’ recreation - including mentoring youths and building programs designed to help bridge the gender gap in various action sports categories as well as underserved community members.

Involvement in Certain Legal Proceedings

None of our directors and executive officers have been involved in any of the following events during the past ten years:

	1.	any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

	2.	any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offences);

	3.	being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities;

	4.	being found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, where the judgment has not been reversed, suspended, or vacated;

	5.	being the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of (i) any federal or state securities or commodities law or regulation; (ii) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease- and-desist order, or removal or prohibition order; or (iii) any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or being the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Securities Exchange Act of 1934), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

1617

Director Independence

Our board of directors has reviewed the composition of our board of directors and the independence of each director. Based upon information requested from and provided by each director concerning his background, employment and affiliations, including family relationships, our board of directors has determined that each of Steven Shum and Sean Fontenot is an “independent director” as defined under Rule 5605(a)(2) of the Nasdaq Marketplace Rules. In making such determinations, our board of directors considered the relationships that each such non-employee director has with our company and all other facts and circumstances our board of directors deemed relevant in determining independence, including the beneficial ownership of our capital stock by each non-employee director.

Board Committees

We do not have a standing Audit Committee. We do not believe that the lack of an Audit Committee has had or will have any adverse effect on our financial statements, based upon current operations; however, our board of directors will consider establishing an Audit Committee of independent directors as the number of directors increases. Until such time, our board of directors will perform the duties of an Audit Committee including delegating an auditor firm and interacting with them.

We do not have a standing Compensation Committee. Presently, the salary and benefits of our executive officers are determined by our entire board of directors. As we continue to develop our data center and commence selling colocation services, we expect to increase the size of our board to include independent directors who will approve the compensation arrangements with our executive officers.

We also do not have a Nominating Committee as we have not adopted any procedures by which security holders may recommend nominees to our board of directors.

Code of Ethics

Effective March 28, 2022, our Board of Directors adopted an amended Code of Business Conduct and Ethics that applies to, among other persons, members of our board of directors, our company’s officers, contractors, consultants and advisors. We will provide a copy of the Code of Business Conduct and Ethics to any person without charge, upon request. Requests can be sent to our company at the address on the cover of this Annual Report.

Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act requires our executive officers, directors and persons who beneficially own more than 10% of our common stock to file with the SEC reports of their ownership and changes in their ownership of our common stock. To our knowledge, based solely on review of the copies of such reports and amendments to such reports with respect to the year ended December 31, ~~2023~~2024 filed with the SEC, all required Section 16 reports under the Exchange Act for our directors, executive officers and beneficial owners of greater than 10% of our common stock were filed on a timely basis during the year ended December 31, ~~2023~~2024, except for ~~(i)~~a late Form ~~3 filings for Joel Stone and Dean Skupen,~~4 ~~(ii)~~filing ~~late Form 4 filings~~ for Michael Campbell~~, Sean Fortenot and Steven Shum, and (iii) late Schedule 13D filings for Michael Campbell and Sean Fortenot~~. As of the date of the filing of this annual report, ~~all~~ such Form ~~3, Form~~ 4 ~~and~~filing ~~Schedule~~has ~~13D filings have~~ been made.

Item 11.

Executive Compensation.

The following table sets forth all compensation awarded to, earned by or paid to the executive officers of our company during the years ended December 31, ~~2023~~2024 and ~~2022~~2023. No compensation was paid to any other executive officer of our company during such periods.

SUMMARY COMPENSATION TABLE

Name and Principal Position	Fiscal Year		Salary ($)		Bonus ($)		Stock Awards ($)		Option/Warrant Awards(4) ($)		Non-Equity Incentive Plan Compensation ($)		Nonqualified Deferred Compensation Earnings ($)		All Other Compensation ($)			Total ($)
Michael Campbell		~~2023~~2024		-239,999		-		-		1323,~~601,110~~050		-		-		~~204~~92,~~179~~006	(1)		1655,~~805,289~~055
Chief Executive Officer		~~2022~~2023		-		-				-1,601,110		-		-		~~200~~204,~~064~~179	(1)		~~200~~1,~~064~~805,289
Joel D. Stone		~~2023~~2024		~~187~~225,~~500~~000		-		-		~~409~~786,~~968~~092		-		-		~~38,396~~-			~~635~~1,~~864~~011,092
President and Chief Operating Officer(2)		~~2022~~2023		-187,500		-		-		-409,968		-		-		-38,396			-635,864
Dean S. Skupen		~~2023~~2024		-		-		-		-		-		-		60,000	(3)		60,000
Chief Financial Officer		~~2022~~2023		-		-		-		-		-		-		60,000	(3)		60,000

	(1)	Represented amounts earned by Mr. Campbell as a consultant to our company. Mr. Campbell became an employee of our company in March 2024.
	(2)	Mr. Stone became our President and Chief Operating Officer on March 28, 2023.
	(3)	Represents amounts earned by Mr. Skupen under his consulting agreement.
	(4)	Reflects the aggregate fair value computed in accordance with the provisions of the Financial Accounting Standard Board Accounting Standards Codification Topic 718, or ASC 718. See Note 2 to our consolidated financial statements for the year ended December 31, ~~2023~~2024 included in this report regarding assumptions underlying the valuation of equity awards. These amounts reflect the accounting cost for these stock options and do not reflect the actual economic value that may be realized by the named executive officer upon the vesting of the stock options, the exercise of the stock options, or the sale of the common stock underlying such stock options.

Employment Agreement

On June 19, 2023, we entered into an Employment Agreement dated as of June 19, 2023 (the “Employment Agreement”) with Joel D. Stone, our President and Chief Operating Officer. Pursuant to the terms of the Employment Agreement, Mr. Stone received or will receive (i) an annual base salary of $250,000, which amount may be increased upon our reaching certain benchmarks described in the Employment Agreement, as determined in our sole discretion; (ii) an initial option grant of seven-year options to purchase 2,500,000 shares of our common stock for a purchase price of $0.50 per share, of which the right to purchase up to 1,250,000 shares will vest in equal installments over a period of three years and the right to purchase up to 1,250,000 shares will vest upon our completing certain milestones that are ~~set~~ set out in the Employment Agreement; and (iii) the right to participate in all benefit plans offered to our senior executive officers.

The Employment Agreement also provides for certain severance benefits upon a termination by us without “cause” or by Mr. Stone for “good reason.” In the event of a termination by us without “cause” or by Mr. Stone for “good reason” after the first full year of employment, Mr. Stone will be entitled to (i) continued payment of his base salary for the lesser of six (6) months or the remaining term of the Employment Agreement, subject to Mr. Stone signing a timely and effective separation agreement containing a release of all claims against us and other customary terms; provided, however, that if such termination is between the 91^stday and the end of the first year of employment, Mr. Stone will be entitled to a pro rata portion of such payment.

The Employment Agreement contains customary confidentiality restrictions and work-product provisions with respect to Mr. Stone, as well as customary non-competition covenants and non-solicitation covenants with respect to our employees, consultants and customers.

Consulting Agreements

On October 20, 2018, we entered into a consulting agreement with DSS Consulting Corporation, a corporation controlled by Dean Skupen, our Chief Financial Officer (“DSS Consulting”), pursuant to which DSS Consulting agreed to continue to provide consulting services to our company and to cause Mr. Skupen to serve as our Chief Financial Officer. The agreement with DSS Consulting will continue until terminated by either party. Pursuant to such agreement, DSS Consulting was issued 250,000 shares of common stock in March 2019 and DSS Consulting will be paid a monthly consulting fee in the amount of $5,000. The consulting agreement contains customary confidentiality restrictions and work-product provisions, as well as customary non-competition covenants and non-solicitation covenants with respect to our employees, consultants and customers.

Equity Compensation Plan Information

The following table provides information as of December 31, ~~2023~~2024, regarding our compensation plans under which equity securities are authorized for issuance:

Plan category

Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights

Weighted- Average Exercise Price of Outstanding Options, Warrants and Rights

Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))

(a)

(b)

(c)

2021 Equity compensation plan approved by security holders

68,~~854~~204,000

0.5397

31,~~146~~796,000

Equity compensation plans not approved by security holders

—

Total

68,~~854~~204,000

0.5397

31,~~146~~796,000

2021 Equity Incentive Plan

On October 4, 2021, we adopted our 2021 Equity Incentive Plan (the “Equity Plan”) to provide an additional means to attract, motivate, retain and reward selected employees and other eligible persons. Our stockholders also approved the Equity Plan on October 4, 2021. On November 28 2023, our board of directors approved an increase in the number shares of common stock reserved for issuance under the Equity Plan to 10,000,000 shares, subject to stockholder approval, which has not yet been obtained. Employees, officers, directors and consultants who provide services to us or one of our subsidiaries were eligible to receive awards under the Equity Plan. Awards under the Equity Plan are issuable in the form of incentive or nonqualified stock options, stock appreciation rights, stock bonuses, restricted stock, stock units and other forms of awards including cash awards.

As of December 31, ~~2023~~2024, options to purchase an aggregate of 68,~~854~~204,000 shares of common stock had been ~~made~~granted under the Equity Plan, and 31,~~146~~796,000 shares authorized under the Equity Plan remained available for award purposes.

Purpose. The purpose of the Equity Plan is to further and promote the interests of our company and its stockholders by enabling us to attract, retain and motivate employees, directors and consultants, or those who will become employees, directors or consultants, and to align the interests of those individuals with the interests of our stockholders.

Administration. The Equity Plan will be administered by an independent compensation committee appointed by the Board (the “Compensation Committee”), which will have general administrative authority for the Equity Plan. In the event that the Board has not appointed the Compensation Committee, then the Board shall have all the powers of the Compensation Committee under the Equity Plan. The Compensation Committee may delegate certain limited authority to one or more of our senior executive officers to grant awards to employees who are not subject to Section 16 of the Exchange Act. Additionally, the Compensation Committee may designate persons other than members of the Compensation Committee to carry out the day-to-day ministerial administration of the Equity Plan (other than with regard to the selection for participation in the Equity Plan and/or the granting of any awards to participants) under such conditions and limitations as prescribed by the Compensation Committee (the appropriate acting body, be it the Compensation Committee, the Board, or an executive officer within his or her delegated authority, is referred to herein as the “Administrator”). The Administrator’s determinations under the Equity Plan need not be uniform and may be made selectively among the Equity Plan’s participants, whether or not such participants are similarly situated.

The Administrator has broad authority under the Equity Plan with respect to award grants including, without limitation, the authority to:

	●	select the Equity Plan’s participants;

	●	make awards in such amounts and form as the Administrator shall determine;

	●	impose such restrictions, terms and conditions upon such awards as the Administrator shall deem appropriate; and

	●	correct any technical defect(s) or technical omission(s), or reconciling any technical inconsistency(ies), in the Equity Plan and/or any award agreement.

Eligibility. Persons eligible to receive awards under the Equity Plan include employees, directors and consultants, or those who will become employees, directors or consultants, of our company and/or its subsidiaries. Notwithstanding the above, incentive stock options may only be granted under the Equity Plan to our employees.

Authorized Shares. The maximum number of shares of common stock that may be initially issued or transferred pursuant to awards under the Equity Plan shall not exceed 10,000,000 shares, all of which may be issued as any type of award permitted under the Equity Plan, including, but not limited to, incentive stock options.

Types of Awards. The Equity Plan authorizes awards of stock options and restricted shares of common stock.

20A stock option is the right to purchase shares of common stock at a future date at a specified price per share. The per share exercise price of an option generally may not be less than the fair market value of a share of common stock on the date of grant. The maximum term of an option is ten years from the date of grant. An option may either be an incentive stock option or a nonqualified stock option. Incentive stock option benefits are taxed differently from nonqualified stock options, as described under “Federal Income Tax Consequences of Awards Under the Plan” below. Incentive stock options are also subject to more restrictive terms and are limited in amount by the U.S. Internal Revenue Code (the “Code”) and the Equity Plan. Incentive stock options may only be granted to employees of our company or a subsidiary.

A stock option is the right to purchase shares of common stock at a future date at a specified price per share (the “Exercise Price”). The per share Exercise Price of an option generally may not be less than the fair market value of a share of common stock on the date of grant. The maximum term of an option is ten years from the date of grant. An option may either be an incentive stock option or a nonqualified stock option. Incentive stock option benefits are taxed differently from nonqualified stock options, as described under “Federal Income Tax Consequences of Awards Under the Plan” below. Incentive stock options are also subject to more restrictive terms and are limited in amount by the U.S. Internal Revenue Code (the “Code”) and the Equity Plan. Incentive stock options may only be granted to employees of our company or a subsidiary.

Restricted shares are shares of common stock granted to Equity Plan participants, subject to such restrictions, terms and conditions, if any, as the Administrator deems appropriate, including, without limitation, (a) restrictions on the sale, assignment, transfer, hypothecation or other disposition of such shares, (b) the requirement that the participant deposit such shares with our company while such shares are subject to such restrictions, and (c) the requirement that such shares be forfeited upon termination of employment or service with our company for any reason or for specified reasons within a specified period of time or for other reasons (including, without limitation, the failure to achieve designated performance goals). Upon satisfaction or lapse of the applicable restrictions, terms, and conditions, subject to applicable securities laws, the participant will receive shares of common stock in exchange for such restricted shares.

Dividend Equivalents; Deferrals. The Administrator may provide for the deferred payment of awards and may determine the other terms applicable to deferrals. The Administrator may provide that awards under the Equity Plan earn dividends or dividend equivalents based on the amount of dividends paid on outstanding shares of common stock.

Assumption and Termination of Awards. Generally, and subject to limited exceptions set forth in the Equity Plan, if we dissolve or undergo certain corporate transactions such as a merger, business combination, or other reorganization, or a sale of substantially all of its assets, all awards then-outstanding under the Equity Plan will become fully vested or paid, as applicable, and will terminate or be terminated in such circumstances, unless the Administrator provides for the assumption, substitution or other continuation of the award. The Administrator also has the discretion to establish other change in control provisions with respect to awards granted under the Equity Plan. For example, the Administrator could provide for the acceleration of vesting or payment of an award in connection with a corporate event that is not described above and provide that any such acceleration shall be automatic upon the occurrence of any such event.

Clawback. We may cancel any award under the Equity Plan, require reimbursement from a participant, and effect any other right of recoupment of equity or other compensation provided under the Equity Plan in accordance with any clawback policies adopted by us.

Transfer Restrictions. Subject to certain exceptions contained in the Equity Plan, awards under the Equity Plan generally are not transferable by the recipient other than by will or the laws of descent and distribution and are generally exercisable, during the recipient’s lifetime, only by the recipient. Any amounts payable or shares issuable pursuant to an award generally will be paid only to the recipient or the recipient’s beneficiary or representative. The Administrator has discretion, however, to establish written conditions and procedures for the transfer of awards to other persons or entities, provided that such transfers comply with applicable federal and state securities laws.

Adjustments. As is customary in incentive plans of this nature, each share limit and the number and kind of shares available under the Equity Plan and any outstanding awards, as well as the exercise or purchase prices of awards, and performance targets under certain types of performance-based awards, are subject to adjustment in the event of certain reorganizations, mergers, combinations, recapitalizations, stock splits, stock dividends, or other similar events that change the number or kind of shares outstanding, and extraordinary dividends or distributions of property to the stockholders.

No Limit on Other Authority. The Equity Plan does not limit the authority of the Board or any committee to grant awards or authorize any other compensation, with or without reference to ~~the~~ our common stock, under any other plan or authority.

Termination of or Changes to the Equity Plan. The Board may amend or terminate the Equity Plan at any time and in any manner. Stockholder approval for an amendment will be required only to the extent then required by applicable law or any applicable listing agency or required under Sections 422 or 424 of the Code to preserve the intended tax consequences of the plan. For example, stockholder approval will be required for any amendment that proposes to increase the maximum number of shares that may be delivered with respect to awards granted under the Equity Plan (adjustments as a result of stock splits or similar events will not, however, be considered an amendment requiring stockholder approval). Unless terminated earlier by the Board, the authority to grant new awards under the Equity Plan will terminate on October 4, 2031. Outstanding awards, as well as the Administrator’s authority with respect thereto, generally will continue following the expiration or termination of the Equity Plan. Generally speaking, outstanding awards may be amended by the Administrator (except for a repricing), but the consent of the award holder is required if the amendment (or any Equity Plan amendment) materially and adversely affects the holder.

Federal Income Tax Consequences of Awards under the Plan.

The U.S. federal income tax consequences of the Equity Plan under current federal law, which is subject to change, are summarized in the following discussion of the general tax principles applicable to the Equity Plan. This summary is not intended to be exhaustive and, among other considerations, does not describe the deferred compensation provisions of Section 409A of the Code to the extent an award is subject to and does not satisfy those rules, nor does it describe certain elections under the Code (such as an election under Code Section 83(b)), alternative minimum tax, or state, local, or international tax consequences.

With respect to nonqualified stock options, we are generally entitled to deduct, and the participant recognizes taxable income in an amount equal to the difference between the option exercise price and the fair market value of the shares at the time of exercise. With respect to incentive stock options, we are generally not entitled to a deduction nor does the participant recognize income at the time of exercise, although the participant may be subject to the U.S. federal alternative minimum tax. Upon a disposition of shares acquired by exercise of an incentive stock option before the end of the applicable incentive stock option holding periods, the participant generally must recognize ordinary income equal to the lesser of (i) the fair market value of the shares at the date of exercise minus the exercise price or (ii) the amount realized upon the disposition of the incentive stock option shares minus the exercise price. Otherwise, a participant’s disposition of shares acquired upon the exercise of an option (including an incentive stock option for which the incentive stock option holding periods are met) generally will result in only capital gain or loss.

With respect to restricted shares, we are generally entitled to deduct and the participant recognizes taxable income in an amount equal to the excess of the fair market value over the price paid (if any) only at the time the restrictions lapse (unless the recipient elects to accelerate recognition as of the date of grant).

If an award is accelerated under the Equity Plan in connection with a “change in control” (as this term is used under the Code), we may not be permitted to deduct the portion of the compensation attributable to the acceleration (“parachute payments”) if it exceeds certain threshold limits under the Code (and certain related excise taxes may be triggered).

We have the authority and the right to deduct or withhold, or require a participant to remit to us, an amount sufficient to satisfy any income, payroll, and other taxes (including, without limitation, pursuant to the Federal Insurance Contributions Act and the Federal Unemployment Tax Act) to the extent required by law to be withheld with respect to any taxable event concerning a participant arising as a result of an award under the Equity Plan.

Incentive Plan Awards

~~The~~No ~~following~~equity ~~table~~awards ~~sets~~or ~~forth information relating to stock option~~ grants were made to our named executive officers during the fiscal year ended December 31, ~~2023~~2024.

	Date of Option/Warrant Grant		# of Options		Fair Value ($)(1)
Michael Campbell(2)		12/6/23		3,454,801		1,314,780
Michael Campbell(2)		12/6/23		500,000		260,000
Michael Campbell		12/6/23		1,000,000		530,000
Joel D. Stone		06/19/23		2,500,000		1,175,000
Joel D. Stone		12/06/23		1,000,000		530,000

	(1)	Reflects the aggregate fair value computed in accordance with the provisions of the Financial Accounting Standard Board Accounting Standards Codification Topic 718, or ASC 718. See Note 2 to our consolidated financial statements for the year ended December 31, 2023 included in this report regarding assumptions underlying the valuation of equity awards. These amounts reflect the accounting cost for these stock options and do not reflect the actual economic value that may be realized by the named executive officer upon the vesting of the stock options, the exercise of the stock options, or the sale of the common stock underlying such stock options.
	(2)	Represents options/warrants granted to M1 Advisors LLC, a company controlled by Michael Campbell.

Outstanding Equity Awards at Fiscal Year-End

The following table sets forth outstanding equity awards to our named executive officers as of December 31, ~~2023~~2024.

	Option/Warrants Awards							Stock Awards
Name	Number of Securities Underlying Unexercised Options/Warrants (#) Exercisable		Number of Securities Underlying Unexercised Options/Warrants (#) Unexercisable		Exercise Price ($)		Expiration Date	Number of Shares or Units of Stock that have not Vested		Market Value of Shares or Units of Stock that have not Vested
Michael Campbell (1)		3,454,801		-	$	0.54	12/31/2028		-		-
Michael Campbell (1)		500,000		-		0.54	12/31/2030		-		-
Michael Campbell (2)		-		500,000		0.54	12/6/2030		-		-
Michael Campbell (3)				500,000		0.54	12/6/2030		-		-
Joel D. Stone (2)		-		500,000		0.50	12/6/2030		-		-
Joel D. Stone (3)				500,000		0.50	12/6/2030		-		-
Joel D. Stone (4)				1,250,000		0.50	6/19/2030		-		-
Joel D. Stone (5)				600,000		0.54	6/19/2030		-		-
Joel D. Stone (5)		-		650,000		0.54	6/19/2030		-		-

	(1)	Granted on December 6, 2023. Represents fully-vested options/warrants granted to M1 Advisors LLC, a company controlled by Michael Campbell.
		Option/Warrants Awards							Stock Awards
	(2)	Granted on December 6, 2023. One third vest on 1st anniversary of grant date, one third on the 2nd anniversary of grant date and one third on the 3rd anniversary of grant date.
Name		Number of Securities Underlying Unexercised Options/Warrants (#) Exercisable		Number of Securities Underlying Unexercised Options/Warrants (#) Unexercisable		Exercise Price ($)		Expiration Date	Number of Shares or Units of Stock that have not Vested		Market Value of Shares or Units of Stock that have not Vested
	(3)	Granted on December 6. 2023. These options vest at various times based on the achievement of various performance milestones.
Michael Campbell (1)			3,545,801		-	$	0.54	12/31/2028		-		-
	(4)	Granted on June 19, 2023. These options vest at various times based on the achievement of various performance milestones.
Michael Campbell (1)			500,000		-		0.54	12/31/2030		-		-
	(5)	Granted on June 19, 2023. One third vest on 1st anniversary of grant date, one third on the 2nd anniversary of grant date and one third on the 3rd anniversary of grant date.
Michael Campbell (2)			166,667		333,333		0.54	12/6/2030		-		-
Michael Campbell (3)					500,000		0.54	12/6/2030		-		-
Joel D. Stone (2)			166,667		333,333		0.50	12/6/2030		-		-
Joel D. Stone (3)					500,000		0.50	12/6/2030		-		-
Joel D. Stone (4)					1,250,000		0.50	6/19/2030		-		-
Joel D. Stone (5)			200,000		400,000		0.54	6/19/2030		-		-
Joel D. Stone (5)			216,666		433,334		0.54	6/19/2030		-		-

	(1)	Granted on December 6, 2023. Represents fully-vested options/warrants granted to M1 Advisors LLC, a company controlled by Michael Campbell.

	(2)	Granted on December 6, 2023. One third vest on 1^st anniversary of grant date, one third on the 2^nd anniversary of grant date and one third on the 3rd anniversary of grant date.

	(3)	Granted on December 6, 2023. These options vest at various times based on the achievement of various performance milestones.

	(4)	Granted on June 19, 2023. These options vest at various times based on the achievement of various performance milestones.

	(5)	Granted on June 19, 2023. One third vest on 1^st anniversary of grant date, one third on the 2^nd anniversary of grant date and one third on the 3rd anniversary of grant date.

Aggregated Option Exercises

There were no options exercised by any officer or director of our company during the year ended December 31, ~~2023~~2024.

Director Compensation

General. The following discussion describes the significant elements of the expected compensation program for members of our board of directors and its committees. The compensation of our directors is designed to attract and retain committed and qualified directors and to align their compensation with the long-term interests of our shareholders. Directors who are also executive officers (each, an “Excluded Director”) will not be entitled to receive any compensation for his or her service as a director, committee member or Chair of our board of directors or of any committee of our board of directors.

Director Compensation Arrangements. Our non-employee director compensation program is designed to attract and retain qualified individuals to serve on our board of directors. Our board of directors, on the recommendation of our compensation committee, will be responsible for reviewing and approving any changes to the directors’ compensation arrangements. In consideration for serving on our board of directors, each director (other than Excluded Directors) will be paid an annual retainer. All directors will be reimbursed for their reasonable out-of-pocket expenses incurred while serving as directors.

Cash Compensation. We did not pay any cash compensation to our directors during the year ended December 31, 2023. However, we intend to implement a cash compensation program for our board members in the future.24

~~Equity~~Cash ~~Awards~~Compensation. ~~The~~We ~~following~~did ~~table~~not ~~sets~~pay ~~forth~~any ~~the~~cash ~~director~~ compensation weto ~~accrued~~our indirectors during the year ended December 31, ~~2023~~2024. ~~(excluding~~However, ~~compensation~~ we intend to implement ~~our~~a ~~executive~~cash ~~officers~~compensation ~~set~~program ~~forth~~for inour ~~the~~board ~~summary~~members ~~compensation~~in ~~table~~the ~~above)~~future.

Name		Option/warrants Awards	Total(1)
Steven Shum	$	210,000	$	210,000
Sean Fontenot		1,131,000		1,131,000
Total:	$	1,341,000		1,341,000

Equity Awards. We did not grant any compensatory equity awards to our directors during the year ended December 31, 2024. However, we intend to implement a program for the grant of equity awards to our board members in the future.

(1) Reflects the aggregate fair value computed in accordance with the provisions of the Financial Accounting Standard Board Accounting Standards Codification Topic 718, or ASC 718. See Note 2 to our consolidated financial statements for the year ended December 31, 2023 included in this report regarding assumptions underlying the valuation of equity awards. These amounts reflect the accounting cost for these stock options and do not reflect the actual economic value that may be realized by the named director upon the vesting of the stock options, the exercise of the stock options, or the sale of the common stock underlying such stock options.

Pension and Retirement Plans

Currently, we do not offer any annuity, pension or retirement benefits to be paid to any of our officers, directors or employees, in the event of retirement.

Item 12.

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

The following table sets forth, as of March 2515, ~~2024~~2025, the names, addresses and number of shares of common stock beneficially owned by (i) all persons known to our management to be beneficial owners of more than 5% of the outstanding shares of our common stock, (ii) each director of our company, (iii) each named Executive Officer and (iv) all executive officers and directors of our company as a group (except as indicated, each beneficial owner listed exercises sole voting power and sole dispositive power over the shares beneficially owned):

Name and Address of Beneficial Owner	Amount and Nature of Beneficial Ownership		Percent of Class(1)
M1 Advisors LLC(2)		11,009,000		40.20%
Michael Campbell(2)		13,066,667		36.2	%
Michael Campbell(2)		11,509,000		41.27%
Joel Stone(3)		583,333		1.6	%
Joel Stone		-		-
Dean Skupen(4)		325,000		0.9	%
Dean Skupen(3)		325,000		1.28%
Steven Shum(5)		565,010		1.6	%
Steven Shum4)		408,655		1.59%
Sean Fontenot(6)		14,283,263		39.5	%
Nanosha LLC 5)		10,774,386		39.14%
Sean Fontenot(5)		11,524,386		40.75%
All executive officers and directors as a group
(5 persons)		2328,~~963~~823,~~051~~273		7679.~~71%~~8	%

(1)	As of March 27, 2004, there were 25,330,540 shares of common stock outstanding. Except as indicated in the footnotes to this table, we believe that all persons named in the table have sole voting and investment power with respect to all common stock shown as beneficially owned by them. In accordance with the rules of the Securities and Exchange Commission (the “Commission”), a person or entity is deemed to be the beneficial owner of common stock that can be acquired by such person or entity within sixty (60) days upon the exercise of options or warrants or other rights to acquire common stock. Each beneficial owner’s percentage ownership is determined by assuming that options and warrants that are held by such person (but not those held by any other person) and which are exercisable within sixty (60) days have been exercised. The inclusion herein of such shares listed as beneficially owned does not constitute an admission of beneficial ownership.
(2)	Represents (i) 8,954,199 shares of common stock owned of record by M1 Advisors LLC, a company controlled by Michael Campbell, (ii) currently-exercisable warrants to purchase 2,054,801 shares of common stock owned of record by M1 Advisors LLC, and (iii) currently-exercisable stock options to purchase 500,000 shares of common stock owned by Michael Campbell. The address of Michael Campbell and M1 Advisors LLC is 11753 Willard Avenue, Tustin, CA 92782. Mr. Campbell has sole voting and investment power over the shares held by M1 Advisors LLC.
(3)	Represents shares of common stock owned of record by DSS Consulting Corporation, a company controlled by Dean Skupen. DSS Consulting Corporation’s address is 30 N Gould Street, Suite 12829, Sharidan, WY 82801 Mr. Skupen has sole voting and investment power over the shares held by DSS Consulting Corporation.
(4)	Represents (i) 196,010 shares of common stock owned of record by Core Fund Management, LP, a company controlled by Steven Shum, (ii) 4,655 shares of common stock owned by Steven Shum and (iii) currently-exercisable stock options to purchase 404,000 shares of common stock owned by Steven Shum. The address of Core Fund Management, LP is 1515 SW 5th Avenue, Suite 606, Portland, OR 97201. Mr. Shum has sole voting and investment power over the shares held by Core Fund Management.
(5)	Represents (i) 8,574,386 shares of common stock owned of record by Nanosha LLC, a company controlled by Sean Fortenot, (ii) currently-exercisable warrants to purchase 2,200,000 shares of common stock owned of record by Nanosha LLC, and (iii) currently-exercisable stock options to purchase 750,000 shares of common stock owned by Sean Fortenot. The address of Nanosha Investments, LLC is 1202 Walnut Avenue, Long Beach, CA 90813. Mr. Fontenot has sole voting and investment power over the securities held by Nanosha Investments, LLC.

(1)

As of March 15, 2025, there were 25,730,540 shares of common stock outstanding. Except as indicated in the footnotes to this table, we believe that all persons named in the table have sole voting and investment power with respect to all common stock shown as beneficially owned by them. In accordance with the rules of the Securities and Exchange Commission (the “Commission”), a person or entity is deemed to be the beneficial owner of common stock that can be acquired by such person or entity within sixty (60) days upon the exercise of options or warrants or other rights to acquire common stock. Each beneficial owner’s percentage of ownership is determined by assuming that options and warrants that are held by such person (but not those held by any other person) and which are exercisable within sixty (60) days have been exercised. The inclusion herein of such shares listed as beneficially owned does not constitute an admission of beneficial ownership.

2425

(2)	Represents (i) 8,854,199 shares of common stock owned of record by M1 Advisors LLC, a company controlled by Michael Campbell, (ii) currently-exercisable warrants to purchase 3,545,801 shares of common stock owned of record by M1 Advisors LLC, (iii) currently-exercisable stock options to purchase 500,000 shares of common stock owned by M1 Advisors LLC, and (iv) currently-exercisable stock options to purchase 166,667 shares of common stock owned by Michael Campbell. The address of Michael Campbell and M1 Advisors LLC is 11753 Willard Avenue, Tustin, CA 92782. Mr. Campbell has sole voting and investment power over the shares held by M1 Advisors LLC.

(3)	Represents currently-exercisable stock options to purchase 583,333 shares of common stock owned by Joel Stone.

(4)	Represents shares of common stock owned of record by DSS Consulting Corporation, a company controlled by Dean Skupen. DSS Consulting Corporation’s address is 30 N Gould Street, Suite 12829, Sharidan, WY 82801 Mr. Skupen has sole voting and investment power over the shares held by DSS Consulting Corporation.

(5)	Represents (i) 161,010 shares of common stock owned of record by Core Fund Management, LP, a company controlled by Steven Shum and (ii) currently exercisable stock options to purchase 404,000 shares of common stock owned by Steven Shum. The address of Core Fund Management, LP is 1515 SW 5th Avenue, Suite 606, Portland, OR 97201. Mr. Shum has sole voting and investment power over the shares held by Core Fund Management.

(6)	Represents (i) 9,074,386 shares of common stock owned of record by Nanosha LLC, a company controlled by Sean Fortenot, (ii) currently exercisable warrants to purchase 4,458,877 shares of common stock owned of record by Nanosha LLC, and (iii) currently-exercisable stock options to purchase 750,000 shares of common stock owned by Nanosha LLC. The address of Nanosha Investments LLC is 1202 Walnut Avenue, Long Beach, CA 90813. Mr. Fontenot has sole voting and investment power over the securities held by Nanosha Investments, LLC.

Item 13.

Certain Relationships and Related Transactions, and Director Independence.

A “related party transaction” is any actual or proposed transaction, arrangement or relationship or series of similar transactions, arrangements or relationships, including those involving indebtedness not in the ordinary course of business, to which we or our subsidiaries were or are a party, or in which we or our subsidiaries were or are a participant, in which the amount involved exceeded or exceeds the lesser of (i) $120,000 or (ii) one percent of the average of our total assets at year-end for the last two completed fiscal years and in which any related party had or will have a direct or indirect material interest. A “related party” includes:

	●	any person who is, or at any time during the applicable period was, one of our executive officers or one of our directors;

	●	any person who beneficially owns more than 5% of our common stock;

	●	any immediate family member of any of the foregoing; or

	●	any entity in which any of the foregoing is a partner or principal or in a similar position or in which such person has a 10% or greater beneficial ownership interest.

Other than compensation arrangements for our named executive officers and directors, which we describe herein, the only related party transactions to which we were a party during the years ended December 31, ~~2023~~2024 and ~~2022~~2023, since December 31, ~~2023~~2024, or any currently proposed related party transaction, are as follows.

Between December 11, 2023 and February 20, 2024, we entered into a series of exchange subscription agreements (each, an “Exchange Agreement”) with 14 holders (each, a “Holder”) of our outstanding promissory notes and, in certain cases, related outstanding stock purchase warrants, pursuant to which we and the Holders agreed to exchange their promissory notes, and, if applicable, related stock purchase warrants, for shares of our common stock. Pursuant to the Exchange Agreements, an aggregate of $5,417,459.50 of principal and accrued interest under the outstanding promissory notes and, if applicable, related stock purchase warrants was exchanged for an aggregate of 10,834,919 shares of common stock (the “Exchange Shares”). Nanosha Investments LLC, a limited liability company controlled by Sean Fontenot, a director of our company (“Nanosha”), entered into an Exchange Agreement with us pursuant to which it exchanged (i) a promissory note with outstanding principal and accrued interest in the aggregate amount of $4,287,193, and (ii) a warrant for the purchase of 1,540,000 shares of common stock, for 8,574,386 of the Exchange Shares.

On February 12, 2024, Nanosha made a loan to us in the amount of $1,000,000 in consideration for which we issued to Nanosha a promissory note in the principal amount of $1,000,000 that bore interest at the rate of 10% per annum and originally matured on May 30, 2024 and a five-year warrant to purchase up to 200,000 shares of common stock with an initial exercise price of $0.50 per share. On May 30, 2024, we issued to Nanosha a five-year warrant to acquire 300,000 shares of common stock with an exercise price of $3.50 per share in consideration for the agreement of Nanosha to extend the maturity date of our promissory note from May 30, 2024 to August 31, 2024 and on August 31, 2024, we issued to Nanosha a five-year warrant to acquire 300,000 shares of common stock with an exercise price of $3.80 per share in consideration for the agreement of Nanosha to extend the maturity date of our promissory note from August 31, 2024 to December 31, 2024.

On December 15, 2024, we entered into an exchange subscription agreement with Nanosha pursuant to which Nanosha exchanged (i) the promissory note we issued to Nanosha on February 12, 2024 in the principal amount of $1,000,000, and (ii) the warrants we issued to Nanosha on May 30, 2024 and August 31, 2024 for the purchase of an aggregate of 600,000 shares of common stock, for (a) 500,000 shares of common stock and (b) a five-year warrant to purchase an aggregate of 2,258,877 shares of common stock for a purchase price of $2.00 per share. In connection with such exchange, we paid accrued interest on the exchanged promissory note in the amount of $105,918 in cash.

Item 14.

Principal Accountant Fees And Services.

Audit Fees

The aggregate fees billed for professional services rendered by RBSM LLP, our principal accountants for the years ended December 31, ~~2023~~2024 and ~~2022~~2023, for the audit of financial statements, quarterly reviews of our interim financial statements and services normally provided by the independent accountant in connection with statutory and regulatory filings or engagements for these periods were as follows:

	For the Years ended December 31,
	2023		2022
	2024			2023
Audit Fees and Audit Related Fees	$	45,000	$	~~28,000~~$	45,000
Tax Fees		-		—	-
All Other Fees		-		—	-
Total	$	45,000	$	~~28,000~~$	45,000

In the above table, “audit fees” are fees billed by our company’s external auditor for services provided in auditing our company’s financial statements for the periods indicated above. “Audit-related fees” are fees not included in audit fees that are billed by the auditor for assurance and related services, including quarterly reviews, that are reasonably related to the performance of the audit of our company’s financial statements. “Tax fees” are fees billed by the auditor for professional services rendered for tax compliance, tax advice and tax planning. “All other fees” are fees billed by the auditor for products and services not included in the foregoing categories.

Our board of directors pre-approves all services provided by our independent auditors. All of the above services and fees were reviewed and approved by our board of directors either before or after the respective services were rendered.

2527

PART IV

Item.15.

Exhibits, Financial Statement Schedules.

Exhibit
Number		Description
3.1		Restated Articles of Incorporation (incorporated by reference to Exhibit 3.1 to our ~~Registration~~Quarterly ~~Statement~~Report onof Form SB10-2Q filed on ~~July~~May 515, ~~2002~~2024).
3.2		~~Certificate~~Amended ofand ~~Change~~Restated ~~filed~~Bylaws ~~with the Nevada Secretary of State on December 20, 2005~~ (incorporated by reference to Exhibit 993.12 to our Current Report on Form 8-K filed on ~~December~~July 2919, ~~2005~~2013).
3.3		Articles of Merger filed with the Nevada Secretary of State on February 6, 2006 (incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K filed on February 9, 2006).
3.4		Certificate of Amendment filed with the Nevada Secretary of State on November 27, 2006 (incorporated by reference from Exhibit 99.1 to Current Report on Form 8-K filed on November 30, 2006).
3.5		Articles of Merger filed with the Nevada Secretary of State on February 6, 2006 (incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed on February 9, 2006).
3.6		Articles of Merger filed with the Nevada Secretary of State on July 15, 2013 (incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed on July 19, 2013).
3.7		Certificate of Change filed with the Nevada Secretary of State on August 28, 2018 (incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed on August 29, 2018).
3.8		Certificate of Designation of Series A Preferred Stock filed with the Nevada Secretary of State on September 12, 2018 (incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K filed on September 14, 2018).
3.9		Amendment to Certificate of Designation After Issuance of Class or Series filed with the Nevada Secretary of State on October 29, 2018 (incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K filed on October 29, 2018).
3.10		Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K filed on July 19, 2013).
4.1		Description of Registered Securities
10.1		2021 Equity Incentive Plan (incorporated by reference to Exhibit Annex A to our Schedule 14C Information Statement filed on October 21, 2021).
10.2		Consulting Agreement dated as of October 10, 2018 between CalEthos Inc. and DSS Consulting Corporation (incorporated by reference to Exhibit 10.12 to our Annual Report on Form 10-K filed on March 31, 2022).
10.3		Employment Agreement dated as of June 19, 2023 between CalEthos Inc. and Joel Stone (incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on June 27, 2023).
10.4		Warrant dated December 6, 2023 of CalEthos issued to M1 Advisors LLC.
10.5		Warrant dated February 12, 2024 of CalEthos Inc. issued to Nanosha Investments LLC. (incorporated by reference to Exhibit 10.5 to our Annual Report on Form 10-K filed on April 9, 2024.
10.6		Warrant dated December 15, 2024 of CalEthos Inc. issued to Nanosha Investments LLC.
14		Code of Conduct and Ethics of CalEthos Inc. (incorporated by reference to Exhibit 14 to our Annual Report on Form 10-K filed on March 31, 2022).
31.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.***
31.2		Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.***
32.1		Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.***
101.ins**		Inline XBRL Instance Document
101.xsd**		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 (embedded within the Inline XBRL document)
**		Furnished. Not filed. Not incorporated by reference. Not subject to liability.
***		A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

2628

Exhibit
Number		Description
10.2		Consulting Agreement dated as of October 10, 2018 between CalEthos Inc. and DSS Consulting Corporation (incorporated by reference to Exhibit 10.12 to our Annual Report on Form 10-K filed on March 31, 2022).
10.3		Employment Agreement dated as of June 19, 2023 between CalEthos Inc. and Joel Stone (incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on June 27, 2023).
10.4		Form of Promissory Note dated February 12, 2024 of CalEthos Inc. to Nanosha Investments LLC.
10.5		Warrant dated February 12, 2024 of CalEthos Inc. issued to Nanosha Investments LLC.
14		Code of Conduct and Ethics of CalEthos Inc. (incorporated by reference to Exhibit 14 to our Annual Report on Form 10-K filed on March 31, 2022).
31.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.***
31.2		Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.***
32.1		Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.***
101.ins**		Inline XBRL Instance Document
101.xsd**		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 (embedded within the Inline XBRL document)
**		Furnished. Not filed. Not incorporated by reference. Not subject to liability.
***		A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

SIGNATURES

Pursuant to the requirements of the 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 on the ~~9th~~1st day of April ~~2024~~2025.

	CalEthos, Inc.

	By:	/s/ Michael Campbell
	Name:	Michael Campbell
	Title:	Chief Executive Officer
		(Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Michael Campbell	Chief Executive Officer and Director	April 91, ~~2024~~2025
Michael Campbell	(Principal Executive Officer)
/s/ Dean S. Skupen	Chief Financial Officer	April 91, ~~2024~~2025
Dean S. Skupen	(Principal Accounting Officer)
/s/ Sean Fontenot	Director	April 91, ~~2024~~2025
Sean Fontenot	(Director)
/s/ Steven Shum	Director	April 91, ~~2024~~2025
Steven Shum	(Director)

2829

~~REPORT OF~~PART ~~INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM~~IV

~~To the~~Item ~~Board~~15. ofExhibits, ~~Directors~~Financial ~~and~~Statement ~~Stockholders of~~Schedules.

~~CalEthos,~~(a) The following documents are filed as part of this ~~Inc.~~Report:

Opinion on the Financial Statements

	Page

Report of Independent Registered Public Accounting Firm (PCAOB 587); RBSM LLP	F-2

Consolidated Balance Sheets as of December 31, 2024 and 2023	F-3

Consolidated Statements of Operations and Comprehensive Loss for the Years Ended December 31, 2024 and 2023	F-4

Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2024 and 2023	F-5

Consolidated Statements of Cash Flows for the Years Ended December 31, 2024 and 2023	F-6

Notes to Consolidated Financial Statements	F-7

We have audited the accompanying consolidated balance sheets of CalEthos Inc., (the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of operations and comprehensive loss, changes in stockholders’ equity (deficit) and cash flows for each of the years in the twoF-year period ended December 31, 2023, and the related notes and schedules (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the consolidated results of its operations and its cash flows for each of the two years in the period ended December 31, 2023 in conformity with accounting principles generally accepted in the United States of America.1

~~The Company’s~~REPORT ~~Ability~~OF toINDEPENDENT ~~Continue~~REGISTERED PUBLIC asACCOUNTING ~~a Going Concern~~FIRM

~~The accompanying~~To ~~consolidated financial statements have been prepared assuming~~ the ~~Company~~Board ~~will continue as a going concern. As discussed in Note 1 to the accompanying consolidated financial statements, although the Company has net income it is primarily attributable to non-cash reversal~~ of ~~compensation~~Directors ~~for restricted stock units, has generated negative cash flows from operating activities, has an accumulated deficit~~ and ~~has~~Stockholders ~~stated that substantial doubt exists about Company’s ability to continue as a going concern. Management’s evaluation~~ of the events and conditions and management’s plans regarding these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

~~Basis for~~CalEthos, ~~Opinion~~Inc.

~~These financial~~Opinion ~~statements are the responsibility of the Company’s management. Our responsibility is to express an opinion~~ on the ~~Company’s~~Financial 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.Statements

We ~~conducted~~ ~~our~~have ~~audits~~audited inthe ~~accordance~~accompanying ~~with~~consolidated ~~the~~balance ~~standards~~sheets of ~~the~~CalEthos ~~PCAOB~~Inc., ~~Those~~(the ~~standards~~“Company”) ~~require~~as ~~that~~of weDecember ~~plan~~31, 2024 and 2023, ~~perform~~ the ~~audit~~related toconsolidated ~~obtain reasonable~~statements ~~assurance~~of ~~about~~operations ~~whether~~and ~~the~~comprehensive ~~financial~~loss, ~~statements~~changes ~~are~~in ~~free~~stockholders’ ofequity and ~~material~~cash flows ~~misstatement,~~for ~~whether~~each ~~due~~of tothe ~~error~~years orin ~~fraud.~~the ~~The~~two-year ~~Company is~~period ~~not~~ended ~~required~~December to31, ~~have~~2024, ~~nor~~and ~~were~~the werelated ~~engaged~~notes toand ~~perform,~~schedules an(collectively ~~audit~~referred to ofas ~~its~~the ~~internal~~“consolidated ~~control over~~ financial ~~reporting~~statements”). AsIn ~~part~~our ofopinion, ~~our~~the ~~audits~~consolidated financial statements present fairly, we ~~are~~in ~~required~~all material torespects, ~~obtain~~the anfinancial ~~understanding~~position of ~~internal~~the ~~control~~Company ~~over~~as ~~financial~~of ~~reporting~~December 31, ~~but~~2024 ~~not~~and ~~for~~2023, and the ~~purpose~~consolidated results of ~~expressing~~its ~~an opinion~~operations onand ~~the~~its ~~effectiveness~~cash flows for each of the ~~Company’s~~two ~~internal~~years ~~control~~in ~~over~~the ~~financial~~period ~~reporting.~~ended ~~Accordingly~~December 31, we2024 ~~express~~in noconformity ~~such~~with ~~opinion~~accounting principles generally accepted in the United States of America.

~~Our~~The ~~audits~~Company’s ~~included~~Ability ~~performing procedures~~ to ~~assess~~Continue 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~~Going ~~basis for our opinion.~~Concern

~~Critical~~The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed ~~Audit~~in ~~Matters~~Note 1 to the accompanying consolidated financial statements, although the Company has net income it is primarily attributable to non-cash reversal of compensation for restricted stock units, has generated negative cash flows from operating activities, has an accumulated deficit and has stated that substantial doubt exists about Company’s ability to continue as a going concern. Management’s evaluation of the events and conditions and management’s plans regarding these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

~~The~~Basis ~~critical~~for audit matters 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.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 ~~determined~~Oversight ~~that~~Board ~~there~~(United States) (“PCAOB”) and are norequired ~~critical~~to ~~audit~~be ~~matters~~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.

~~/s/~~We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain ~~RBSM~~reasonable ~~LLP~~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.

WeOur audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error ~~have~~or ~~served~~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 ~~Company’s~~overall ~~auditor~~presentation ~~since~~of ~~2018~~the financial statements. We believe that our audits provide a reasonable basis for our opinion.

~~New~~Critical ~~York,~~Audit NYMatters

~~April~~The critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required 9to 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. RBSM determined there were no CAM’s for the audit of the year ended December 31, 2024.

~~PCAOB~~/s/ IDRBSM ~~No. 587~~LLP

~~F-1~~We have served as the Company’s auditor since 2018.

~~CalEthos~~New York, ~~Inc.~~ NY

~~Consolidated~~April ~~Balance~~1, ~~Sheets~~2025

AsPCAOB ID ofNo. ~~December 31,~~587

	2023			2022
Assets
Current assets
Cash and cash equivalents	$	308,000		$	2,067,000
Prepaid and other current expenses		10,000			4,000
Total current assets		318,000			2,071,000
Data center costs		2,262,000			-
Other assets		-			-
Total assets	$	2,580,000		$	2,071,000
Liabilities and stockholders’ equity (deficit)
Current liabilities
Accounts payable and accrued expenses	$	670,000		$	540,000
Convertible promissory notes, net		341,000			4,613,000
Notes payable		11,000			61,000
Total current liabilities		1,022,000			5,214,000
Stockholders’ equity (deficit)
Series A convertible preferred stock, par value $0.001, 3,600,000 shares authorized; no shares issued and outstanding		-			-
Preferred stock, par value $0.001, 100,000,000 shares authorized; no shares issued and outstanding		-			-
Preferred stock value		-			-
Common stock par value $0.001: 100,000,000 shares authorized; 24,345,598 and 24,495,621 shares issued and outstanding		24,000			24,000
Additional paid-in capital		20,807,000			11,480,000
Other comprehensive income		9,000			5,000
Stock subscription receivable		(2,000	)		(2,000	)
Accumulated deficit		(19,280,000	)		(14,650,000	)
Total stockholders’ equity (deficit)		1,558,000			(3,143,000	)
Total liabilities and stockholders’ equity (deficit)	$	2,580,000		$	2,071,000

F-2

~~F-2~~CalEthos, Inc.

~~CalEthos,~~Consolidated Balance ~~Inc.~~ Sheets

~~Consolidated Statements~~ As of ~~Operations~~December ~~and Comprehensive (Loss) Income~~31,

For the Year Ended December 31,

	2024			2023

Assets
Current assets
Cash and cash equivalents	$	286,000		$	308,000
Prepaid and other current expenses		10,000			10,000
Total current assets		296,000			318,000
Data center Campus costs		5,849,000			2,262,000
Total assets	$	6,145,000		$	2,580,000

Liabilities and stockholders’ equity
Current liabilities
Accounts payable and accrued expenses	$	504,000		$	670,000
Convertible promissory notes, net		-			341,000
Notes payable, net of discount		11,000			11,000
Total current liabilities		515,000			1,022,000

Convertible debentures, net		1,313,000			-
Total liabilities		1,828,000			1,022,000

Stockholders’ equity
Series A convertible preferred stock, par value $0.001, 3,600,000 shares authorized; no shares issued and outstanding		-			-
Preferred stock, par value $0.001, 100,000,000 shares authorized, no shares issued and outstanding		-			-
Preferred stock, value		-			-
Common stock par value $0.001: 100,000,000 shares authorized; 25,730,540 and 24,345,598 shares issued and outstanding		26,000			24,000
Additional paid-in capital		36,153,000			20,807,000
Other comprehensive income		9,000			9,000
Stock subscription receivable		(1,000	)		(2,000	)
Accumulated deficit		(31,870,000	)		(19,280,000	)
Total stockholders’ equity		4,317,000			1,558,000

Total liabilities and stockholders’ equity	$	6,145,000		$	2,580,000

	2023			2022
Revenues	$	-		$	-
Operating Expenses
Professional fees		344,000			667,000
Equity-based compensation		3,032,000			(4,791,000	)
General and administrative expenses		38,000			52,000
Payroll and related expense		51,000			-
Impairment loss		-			154,000
Operating expense		3,465,000			(3,918,000	)
(Loss) income from operations		(3,465,000	)		3,918,000
Other income (expenses)
Interest income		50,000			7,000
Gain on settlement of debt		23,000			-
Financing costs		(252,000	)		(1,744,000	)
Loss on extinguishment of debt		(986,000	)
Total other expenses		(1,165,000	)		(1,737,000	)
(Loss) income before provision for income taxes		(4,630,000	)		2,181,000
Provision for income taxes		-			-
Net (loss) income		(4,630,000	)		2,181,000
Net (loss) income per share - Basic		(0.24	)		0.15
Net (loss) income per share - Diluted		(0.24	)		0.08
Weighted Average common shares outstanding - Basic		19,157,230			14,495,621
Weighted Average common shares outstanding - Diluted		19,157,230			29,342,327
Comprehensive (loss) income
Net (loss) income		(4,630,000	)		2,181,000
Foreign currency translation gain		4,000			7,000
Comprehensive (loss) income	$	(4,626,000	)	$	2,188,000

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

F-3

CalEthos, Inc.

Consolidated ~~Statement~~Statements of ~~Changes~~Operations inand ~~Stockholders’~~Comprehensive ~~Equity (Deficit)~~ Loss

For the Years Ended December 31~~, 2023 and 2022~~ .

	Shares			Amount			Shares		Amount		Shares			Amount			Capital			Receivable			Income (Loss)			Deficit			(Deficit)
	2024			2023
	Series A convertible preferred stock						Preferred Stock				Common Stock						Additional Paid-in			Stock Subscription			Other Comprehensive			Accumulated			Total Stockholders Equity
Revenues	$	-		$	-
	Shares			Amount			Shares		Amount		Shares			Amount			Capital			Receivable			Income (Loss)			Deficit			(Deficit)
Operating Expenses
Balance December 31, 2021		-		$	-			-	$	-		25,995,621		$	26,000			16,269,000		$	(2,000	)	$	(2,000	)	$	(16,831,000	)	$	(540,000	)
Professional fees		386,000			344,000
Equity-based compensation		-369,000			-3,032,000			-		-		-			-			~~6,377,000~~			-			-			-			~~6,377,000~~
Forfeiture of equity-based compensation		-			-			-		-		(1,500,000	)		(2,000	)		(11,166,000	)		-			-			-			(11,168,000	)
General and administrative expenses		49,000			38,000
Foreign currency translation income		-			-			-		-		-			-			-			-			7,000			-			7,000
Data center campus cost - abandonment		344,000			-
Net income		-			-			-		-		-			-			-			-			-			2,181,000			2,181,000
Payroll and related expense		259,000			51,000
Balance, December 31, 2022		-			-			-		-		24,495,621			24,000			11,480,000			(2,000	)		5,000			(14,650,000	)		(3,143,000	)
Total operating expenses		1,407,000			3,465,000
Balance		-			-			-		-		24,495,621			24,000			11,480,000			(2,000	)		5,000			(14,650,000	)		(3,143,000	)
Loss from operations		(1,407,000	)		(3,465,000	)
Cancellation of shares equity-based compensation												(10,000,000	)		(10,000	)		10,000			-			-			-			-
Other income (expenses)
Shares issued for extinguishment of debt		-			-			-		-		9,849,977			10,000			5,949,000			-			-			-			5,959,000
Interest income		12,000			50,000
Equity-based compensation		-			-			-		-		-			-			3,368,000			-			-			-			3,368,000
Financing costs		(12,000	)		(252,000	)
Foreign currency translation income		-			-			-		-		-			-			-			-			4,000			-			4,000
Financing costs – related party		(2,398,000	)		-
Net loss		-			-			-		-		-			-			-			-			-			(4,630,000	)		(4,630,000	)
Gain on settlement of accounts payable		-			23,000
Net income (loss)		-			-			-		-		-			-			-			-			-			(4,630,000	)		(4,630,000	)
Loss on extinguishment of notes payable – related party		(2,317,000	)		-
Balance, December 31, 2023		-		$	-			-	$	-		24,345,598		$	24,000		$	20,807,000		$	(2,000	)	$	9,000		$	(19,280,000	)	$	1,558,000
Loss on extinguishment of convertible promissory notes		(6,468,000	)		(986,000	)
Balance		-		$	-			-	$	-		24,345,598		$	24,000		$	20,807,000		$	(2,000	)	$	9,000		$	(19,280,000	)	$	1,558,000
Total other expenses		(11,183,000	)		(1,165,000	)
Loss before provision for income taxes		(12,590,000	)		(4,630,000	)
Provision for income taxes		-			-
Net loss		(12,590,000	)		(4,630,000	)
Net loss per share - Basic and Diluted		(0.50	)		(0.24	)
Weighted Average common shares outstanding - Basic and Diluted		25,152,137			19,157,230
Comprehensive (loss) income
Net loss		(12,590,000	)		(4,630,000	)
Foreign currency translation gain		-			4,000
Comprehensive loss	$	(12,590,000	)	$	(4,626,000	)

~~F-4~~The accompanying notes are an integral part of these consolidated financial statements.

~~CalEthos, Inc.~~ F-4

~~Consolidated Statements of Cash Flows~~CalEthos, Inc.

~~For~~Consolidated ~~the~~Statements ~~Years~~of ~~Ended~~Stockholders’ ~~December 31,~~ Equity

	2023			2022
Cash Flows From Operating Activities
Net (loss) income	$	(4,630,000	)	$	2,181,000
Adjustments to reconcile net (loss) income to net cash used in operating activities:
Impairment		-			154,000
Amortization of convertible promissory note discounts		-			1,526,000
Forfeiture of restricted stock awards		-			(11,168,000	)
Fair value of equity-based compensation		3,032,000			6,377,000
Gain on settlement of accounts payable		(23,000	)		-
Loss on extinguishment of debt		986,000			-
Changes in operating assets and liabilities
Prepaid expenses and other current assets		(6,000	)		3,000
Accounts payable and accrued expenses		606,000			107,000
Net Cash Used in Operating Activities		(35,000	)		(820,000	)
Cash Flows From Investing Activities
Project development cost		(1,730,000	)		-
Other assets		-			(105,000	)
Net Cash Used in Investing Activities		(1,730,000	)		(105,000	)
Cash Flows From Financing Activities
Repayments of notes payable		-			(50,000	)
Net Cash Used in Financing Activities		-			(50,000	)
Effect of exchange rate changes on cash and cash equivalents		6,000			(5,000	)
Net decrease in Cash		(1,759,000	)		(980,000	)
Cash, Beginning of Period		2,067,000			3,047,000
Cash, End of Period	$	308,000		$	2,067,000
Supplemental disclosure of cash flow information:
Cash paid for interest	$	-		$	5,407
Cash paid for income taxes	$	-		$	-
Non-cash investing and financing activities
Equity-based compensation capitalized	$	336,000		$	-
Common stock issued from forgiven debt	$	4,974,000		$	-

For the Years Ended December 31, 2024 and 2023

F-5

	Shares		Amount		Shares		Amount		Shares			Amount			Capital		Receivable			Income		Deficit			equity
	Series A convertible preferred stock				Preferred Stock				Common Stock						Additional Paid-in		Stock Subscription			Other Comprehensive		Accumulated			Total Stockholders’
	Shares		Amount		Shares		Amount		Shares			Amount			Capital		Receivable			Income		Deficit			equity
Balance December 31, 2022		-	$	-		-	$	-		24,495,621		$	24,000		$	11,480,000	$	(2,000	)	$	5,000	$	(14,650,000	)	$	(3,143,000	)
Cancellation of shares		-		-		-		-		(10,000,000	)		(10,000	)		10,000		-			-		-			-
Shares issued for extinguishment of convertible debentures		-		-		-		-		9,849,977			10,000			5,949,000		-			-		-			5,959,000
Equity-based compensation		-		-		-		-		-			-			3,368,000		-			-		-			3,368,000
Foreign currency translation income (loss)		-		-		-		-		-			-			-		-			4,000		-			4,000
Net loss		-		-		-		-		-			-			-		-			-		(4,630,000	)		(4,630,000	)
Balance December 31, 2023		-		-		-		-		24,345,598			24,000			20,807,000		(2,000	)		9,000		(19,280,000	)		1,558,000
Balance		-		-		-		-		24,345,598			24,000			20,807,000		(2,000	)		9,000		(19,280,000	)		1,558,000
Shares issued for extinguishment of Convertible Debentures and accrued interest										884,942			1,000			6,927,000		-			-		-			6,928,000
Warrants issued for note payable extension		-		-		-		-		-			-			2,355,000		-			-		-			2,355,000
Shares issued for extinguishment of notes payable		-		-		-		-		500,000			1,000			874,000		-			-		-			875,000
Warrants issued for extinguishment of notes payable		-		-		-		-		-			-			2,441,000		-			-		-			2,441,000
Proceeds for stock subscription receivable		-		-		-		-		-			-			-		1,000			-		-			1,000
Equity-based compensation		-		-		-		-		-			-			2,749,000		-			-		-			2,749,000
Net loss		-		-		-		-		-			-			-		-			-		(12,590,000	)		(12,590,000	)
Balance December 31, 2024		-	$	-		-	$	-		25,730,540		$	26,000		$	36,153,000	$	(1,000	)	$	9,000	$	(31,870,000	)	$	4,317,000
Balance		-	$	-		-	$	-		25,730,540		$	26,000		$	36,153,000	$	(1,000	)	$	9,000	$	(31,870,000	)	$	4,317,000

~~CalEthos,~~The ~~Inc~~accompanying notes are an integral part of these consolidated financial statements.

~~Notes to the Consolidated Financial Statements~~F-5

~~For the Years Ended December 31~~CalEthos, ~~2023~~ Inc.

~~Note~~Consolidated 1Statements –of ~~Organization and Accounting Policies~~Cashflow

~~ORGANIZATION~~For the ~~AND~~Years ~~ACCOUNTING~~Ended ~~POLICIES~~December 31,

CalEthos, Inc. (the “Company” or “we”) was incorporated on March 20, 2002 under the laws of the State of Nevada.

	2024			2023
Cash Flows From Operating Activities
Net loss	$	(12,590,000	)	$	(4,630,000	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of note payable discounts		2,355,000			-
Amortization of debt issuance cost		9,000			-
Fair value of equity-based compensation		369,000			3,032,000
Gain on settlement of accounts payable		-			(23,000	)
Loss on extinguishment of notes payable – related party		2,317,000			-
Loss on extinguishment of debt		6,468,000			986,000
Write off of development cost		344,000			-
Changes in operating assets and liabilities
Prepaid expenses and other current assets		-			(6,000	)
Accounts payable and accrued expenses		(131,000	)		606,000
Net Cash Used in Operating Activities		(859,000	)		(35,000	)

Cash Flows From Investing Activities
Date center campus development cost		(1,467,000	)		(1,730,000	)
Net Cash Used in Investing Activities		(1,467,000	)		(1,730,000	)

Cash Flows From Financing Activities
Cash proceeds from issuance of convertible debentures		1,410,000			-
Cost for issuance of convertible debentures		(106,000	)		-
Proceeds from stock subscription receivable		1,000			-
Cash proceeds for issuances of notes payable		1,000,000			-
Net Cash Provided by Financing Activities		2,305,000			-

Effect of exchange rate changes on cash and cash equivalents		(1,000	)		6,000
Net decrease in cash and cash equivalents		(22,000	)		(1,759,000	)
Cash and cash equivalents, beginning of period		308,000			2,067,000
Cash and cash equivalents, end of period	$	286,000		$	308,000

Supplemental disclosure of cash flow information:
Cash paid for interest	$	100,000		$	-
Cash paid for income taxes	$	-		$	-

Non-cash investing and financing activities
Common stock and warrants issued for extinguishment of notes payable	$	3,315,000		$	-
Note payable converted to equity	$	1,000,000		$	-
Capitalized interest – project development cost	$	81,000		$	203,000
Convertible debentures accrued interest converted to equity	$	459,000		$	4,974,000
Equity-based compensation capitalized	$	2,380,000		$	336,000

The ~~Company~~accompanying isnotes ~~implementing~~are ~~its~~an ~~plan~~integral to build a clean-energy-powered data center operation using the latest energy-efficient building materials and cooling technologies and to provide wholesale colocation services to enterprise IT and hyperscale customers. In addition, the Company may acquire assets and all or part of ~~other~~these ~~companies~~consolidated ~~operating~~financial ~~in the high-density computing industry or invest in or joint venture with other more-established companies already in the industry that would add value to the Company’s business strategy~~statements.

~~As of July 2022, the Company’s board of directors resolved to focus exclusively on developing a clean~~F-~~energy-powered data center.~~6

~~Korean~~CalEthos, ~~entity~~Inc.

OnNotes ~~November 5, 2021, AIQ System Inc. (“AIQ”) was incorporated in Seoul, Republic of Korea. AIQ is authorized~~ to ~~issue 3 million shares of common stock. At~~ the ~~date~~Consolidated ofFinancial incorporation, 10,000 shares were issued to the Company for 100,000,000 Korean Won, or approximately $89,000, for 100% ownership of AIQ. As of July 2022, AIQ was placed into a dormant state of operations.Statements

~~Basis~~For ofthe ~~Presentation~~Years Ended December 31, 2024 and 2023

~~The~~Note ~~accompanying~~1 ~~consolidated~~– ~~financial~~Organization ~~statements~~and ~~have~~Accounting ~~been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).~~Policies

~~Principles of~~ORGANIZATION ~~Consolidation~~AND ACCOUNTING POLICIES

~~The~~CalEthos, ~~consolidated~~Inc. ~~financial statements include~~ (the ~~accounts~~“Company” ofor ~~the~~“we”) ~~Company~~was ~~and~~incorporated ~~its~~on ~~wholly~~March ~~owned~~20, ~~subsidiary~~2002 ~~from~~under the ~~formation~~laws ~~date.~~of ~~All~~the ~~material intercompany~~State ~~transactions~~of ~~and balances have been eliminated in consolidation~~Nevada.

~~Going~~As ~~Concern~~of July 2022, the Company’s board of directors resolved to focus exclusively on developing a clean-energy-powered data center (“Data Center Campus”). As such, the Company is implementing its plan to build aa large-scale, data center campus vertically integrated with onsite geothermal power production In addition, the Company may acquire assets and ~~Liquidity~~all or part of other companies operating in the clean energy or data center infrastructure industries or invest in or joint venture with other more-established companies already in the industry that would add value to the Company’s business strategy.

~~The~~Korean Company incurred a net loss of approximately $4,630,000 for the year ended December 31, 2023, had an accumulated deficit of approximately $19,280,000 as of December 31, 2023 and had no recurring revenue from operations. The Company has financed its activities principally through debt and equity financing and shareholder contributions. Management expects to incur additional losses and cash outflows in the foreseeable future in connection with its operating activities. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for one year from the issuance of these consolidated financial statements.entity

~~The~~On ~~Company’s~~November ~~consolidated~~5, ~~financial~~2021, ~~statements~~AIQ ~~have~~System ~~been~~Inc. ~~presented~~(“AIQ”) onwas aincorporated ~~going~~in ~~concern basis~~Seoul, ~~which~~Republic ~~contemplates~~of ~~the~~Korea. ~~realization~~AIQ is authorized to issue 3 million shares of ~~assets~~common ~~and~~stock. At the ~~satisfaction~~date of ~~liabilities~~incorporation, in10,000 shares were issued to the ~~normal~~Company ~~course~~for 100,000,000 Korean Won, or approximately $89,000, for 100% ownership of ~~business~~AIQ. As of July 2022, AIQ was placed into a dormant state of operations.

~~The~~Basis ~~Company is subject to a number~~ of risks similar to those of other similar stage companies, including dependence on key individuals; successful development, marketing and branding of services; the uncertainty of product development and generation of revenues; dependence on outside sources of financing; risks associated with research and development; dependence on third-party suppliers and collaborators; protection of intellectual property; and competition with larger, better-capitalized companies. Ultimately, the attainment of profitable operations is dependent on future events, including obtaining adequate financing to fund the Company’s operations and generating a level of revenues adequate to support the Company’s cost structure.Presentation

~~F-6~~The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”).

~~The~~Principles Company will need to raise debt or equity financing in the future in order to continue its operations and achieve its growth targets. However, there can be no assurance that such financing will be available in sufficient amounts and on acceptable terms, when and if needed, or at all. The precise amount and timing of the funding needs cannot be determined accurately at this time, and will depend on a number of factors, including the development of the Company’s data center campus development, approvals for construction permits, construction times, delivery of critical equipment, market demand for the Company’s wholesale colocation data center services, the timing of customer commitments for data center space, the management of working capital, and payment terms and conditions for purchase of the Company’s services. The Company believes its cash balances and cash flow from operations will not be sufficient to fund its operations and growth for the next twelve months from the issuance date of these financial statements. If the Company is unable to raise additional funding from investors or through other avenues, it may not be able to continue as a going concern. The accompanying audited consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.Consolidation

~~Use~~The consolidated financial statements include the accounts of ~~Estimates~~the Company and its wholly-owned subsidiary from the formation date. All material intercompany transactions and balances have been eliminated in consolidation.

~~The~~Going ~~preparation~~Concern ~~of consolidated financial statements in conformity with GAAP~~ and 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 reported amounts of revenue and expenses during the reporting periods.Liquidity

~~Foreign~~The ~~Currency~~Company ~~Translation~~incurred a net loss of approximately $12,590,000 for the year ended December 31, 2024, had an accumulated deficit of approximately $31,870,000 as of December 31, 2024 and had no recurring revenue from operations. The Company has financed its activities principally through debt and equity financing and shareholder contributions. Management expects to incur additional losses and cash outflows in the foreseeable future in connection with its operating activities. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for one year from the issuance of these consolidated financial statements.

The financial statements of foreign subsidiaries, for which the functional currency is the local currency, are translated into U.S. dollars using the exchange rate at the consolidated balance sheet date for assets and liabilities and a weightedF-average exchange rate during the year for revenue, expenses, gains and losses. Translation adjustments are recorded as other comprehensive income (loss) within shareholders’ equity (deficit). Gains or losses from foreign currency transactions are recognized in the consolidated statements of operations.7

~~Fair~~The ~~Value~~Company’s ~~Measurement~~consolidated financial statements have been presented on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

~~Fair~~The ~~value~~Company is ~~defined~~subject ~~as the exchange price that would be received for an asset or paid~~ to ~~transfer~~ a ~~liability~~number ~~(an~~of ~~exit~~risks ~~price)~~similar into ~~the~~those ~~principal or~~of ~~most~~other ~~advantageous~~similar ~~market~~stage ~~for~~companies, ~~the~~including ~~asset~~dependence oron ~~liability~~key inindividuals; ansuccessful development, ~~orderly~~marketing ~~transaction~~and ~~between~~branding ~~market participants as~~ of services; the ~~measurement~~uncertainty ~~date. Applicable~~of ~~accounting~~product ~~guidance~~development ~~provides~~and angeneration ~~established~~of ~~hierarchy~~revenues; ~~for~~dependence ~~inputs~~on ~~used in measuring fair value that maximizes the use of observable~~outside ~~inputs~~sources ~~and minimizes the use~~ of ~~unobservable~~financing; ~~inputs~~risks byassociated ~~requiring~~with ~~that~~research ~~the~~and ~~most~~development; ~~observable~~dependence ~~inputs~~on bethird-party ~~used~~suppliers ~~when~~and ~~available.~~collaborators; ~~Observable inputs~~protection ~~are~~of ~~inputs~~intellectual ~~that~~property; ~~market~~and ~~participants~~competition ~~would~~with ~~use~~larger, inbetter-capitalized ~~valuing~~companies. Ultimately, the ~~asset~~attainment orof ~~liability~~profitable ~~and~~operations is ~~are~~dependent ~~developed based~~ on ~~market~~future ~~data~~events, ~~obtained~~including ~~from sources~~obtaining ~~independent~~adequate offinancing ~~the~~to ~~Company.~~fund ~~Unobservable inputs are inputs that reflect~~ the Company’s ~~assumptions~~operations ~~about~~and ~~the~~generating ~~factors~~a ~~that~~level of ~~market~~revenues ~~participants~~adequate ~~would~~to ~~use~~support ~~in valuing~~ the ~~asset~~Company’s orcost ~~liability~~structure. ~~There are three levels of inputs that may be used to measure fair value:~~

~~Level~~The 1Company -will ~~Observable~~need ~~inputs~~to raise debt or equity financing in the future in order to continue its operations and achieve its growth targets. However, there can be no assurance that ~~reflect~~such ~~quoted~~financing ~~prices~~will ~~(unadjusted)~~be available in sufficient amounts and on acceptable terms, when and if needed, or at all. The precise amount and timing of the funding needs cannot be determined accurately at this time, and will depend on a number of factors, including the development of the Company’s data center campus, approvals for ~~identical~~construction ~~assets~~permits, construction times, delivery of critical equipment, market demand for the Company’s wholesale colocation data center services, the timing of customer commitments for data center space, the management of working capital, and payment terms and conditions for purchase of the Company’s services. The Company believes its cash balances and cash flow from operations will not be sufficient to fund its operations and growth for the next twelve months from the issuance date of these financial statements. If the Company is unable to raise additional funding from investors or ~~liabilities~~through inother ~~active~~avenues, ~~markets~~it may not be able to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

~~Level 2~~Segment ~~- Other inputs that are directly or indirectly observable in the marketplace.~~Reporting

~~Level 3~~The Company adopted FASB issued ASU 2023-07, ~~Unobservable~~“Segment Reporting ~~inputs~~(ASC ~~which~~Topic 280) for the annual reporting period ended December 31, 2024. The most significant provision was for the Company to disclose significant segment expenses that are ~~supported~~regularly byprovided ~~little~~to orthe chief operating decision maker (“CODM”), who is the CEO. All expense categories on the Consolidated Statements of Operations are significant and there are no ~~market~~other ~~activity~~significant segment expenses that would require disclosure. The Company’s CODM, reviews financial information presented on a consolidated basis for the purpose of making operating decisions, allocating resources, assessing financial performance and making strategic decisions related to headcount and capital expenditures. The CODM regularly reviews net loss as reported on the Company’s consolidated statements of operations. The CODM uses net loss as the measure of profit or loss to allocate resources and assess performance.

~~The~~Since the Company operates as one reportable segment, ~~fair~~all ~~value~~financial ~~hierarchy~~information ~~also~~required ~~requires~~by an“Segment ~~entity~~Reporting” tocan ~~maximize~~be found in the ~~use~~accompanying ofconsolidated ~~observable~~financial ~~inputs~~statements. The CODM does not review segment assets at a level other than that presented in the Company’s consolidated balance sheets. There are no intra-entity sales or transfers, and ~~minimize~~no significant expense categories regularly provided to the ~~use~~CODM ofbeyond ~~unobservable~~those ~~inputs~~disclosed ~~when~~in ~~measuring~~the ~~fair~~Consolidated ~~value~~Statements of Operations.

AsUse of ~~and for the year ended December 31, 2023, the Company had no assets or liabilities that require fair value measurement.~~Estimates

~~F-7~~The preparation of consolidated 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods.

~~Cash~~Foreign ~~and~~Currency ~~Cash Equivalents~~Translation

The ~~Company~~financial ~~considers~~statements ~~all highly liquid investments with maturities~~ of ~~three~~foreign ~~months~~subsidiaries, orfor ~~less~~which at the ~~time~~functional ofcurrency ~~purchase~~is tothe belocal ~~cash~~currency, ~~equivalents. Cash and cash equivalents~~ are ~~recorded~~translated atinto ~~cost, which approximates its fair value~~U.S. ~~The Company maintains its cash and cash equivalents~~dollars inusing ~~banks~~the ~~insured~~exchange byrate at the ~~Federal~~consolidated ~~Deposit~~balance ~~Insurance~~sheet ~~Corporation~~date ~~(“FDIC”)~~for inassets ~~accounts~~and ~~that~~liabilities atand ~~times~~a ~~may~~weighted-average beexchange inrate ~~excess of the~~during ~~federally~~the ~~insured~~year ~~limit~~for ofrevenue, ~~$250~~expenses,~~000~~ ~~per~~gains ~~bank~~and losses. ~~The~~Translation ~~Company~~adjustments ~~minimizes~~are ~~this~~recorded ~~risk~~as byother ~~placing~~comprehensive ~~its~~income ~~cash~~(loss) ~~deposits~~within ~~with~~shareholders’ equity ~~major financial institutions~~(deficit). As ofGains ~~December~~or ~~31,~~losses ~~2023~~from ~~and~~foreign ~~2022,~~currency ~~the~~transactions ~~Company~~are ~~had~~recognized ~~approximately $22,000 and $1,817,000, respectively,~~ in ~~excess of~~ the ~~federal~~consolidated ~~insurance limit,~~statements ~~respectively~~of operations.

~~Prepaid~~Fair ~~Expense~~Value Measurement

~~Prepaid~~Fair ~~expenses~~value ~~are~~is ~~assets~~defined ~~held~~as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the ~~Company,~~most ~~which~~observable inputs be used when available. Observable inputs are ~~expected~~inputs tothat bemarket ~~realized~~participants would use in valuing the asset or liability and ~~consumed~~are ~~within~~developed ~~twelve~~based ~~months~~on ~~after~~market data obtained from sources independent of the ~~reporting~~Company. ~~period~~Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:

Data Center Cost

Level 1 -	Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2 -	Other inputs that are directly or indirectly observable in the marketplace.
Level 3 -	Unobservable inputs which are supported by little or no market activity.

Data center cost is stated at cost, which includes the cost incurred to complete phase I of our data center development plan. Phase I costs include the option payment for the land and the cost of consulting firms to provide power and connectivity assessments, feasibility studies, engineering plans, and project benchmarking. Also data center cost includes internal cost such as payroll related cost and debt interest cost.F-8

InThe ~~accordance~~fair ~~with~~value ~~ASC~~hierarchy ~~360-10-35,~~also ~~the~~requires ~~Company~~an ~~reviews~~entity ~~the~~to ~~carrying~~maximize ~~amounts of data center cost when events or changes in circumstances indicate~~ the ~~assets~~use ~~may not be recoverable. If any such indication exists, the recoverable amount~~ of ~~the~~observable ~~asset~~inputs isand ~~estimated~~minimize ~~in order to determine~~ the ~~extent~~use of ~~the~~unobservable ~~impairment~~inputs ~~loss, if any. Where it is not possible to estimate the recoverable amount of an individual asset, the Company~~when ~~estimates~~measuring ~~the~~fair ~~recoverable amount of the cash-generating unit to which the asset belongs~~value.

~~The~~As ~~recoverable~~of ~~amount~~and isfor the ~~higher~~years ofended ~~fair~~December ~~value~~31, ~~less~~2024 ~~costs of disposal~~ and ~~value in use. In assessing value in use~~2023, the ~~estimated~~Company ~~future cash~~had ~~flows~~no toassets ~~be derived from continuing use of the asset~~ or ~~cash-generating~~liabilities ~~unit are discounted to their present value using a pre-tax discount rate~~ that ~~reflects~~require current market assessments of the time value of money and the risks specific to the asset. Fair value less costs of disposal is the amount obtainable from the sale of an asset or cash-generating unit in an arm’s length transaction between knowledgeable, willing parties, less the cost of disposal. When a binding sale agreement is not available, fair value ~~less costs of disposal is estimated using a discounted cash flow approach with inputs and assumptions consistent with those of a market participant~~measurement. If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the cash-generating unit is reduced to its recoverable amount. An impairment loss is recognized immediately in net income.

AsCash ofand ~~December~~Cash ~~31, 2023, there have been no circumstances to indicate the asset may not be recoverable.~~Equivalents

~~Related~~The ~~Parties~~Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents. Cash and cash equivalents are recorded at cost, which approximates their fair value. The Company maintains its cash and cash equivalents in banks insured by the Federal Deposit Insurance Corporation (“FDIC”) in accounts that at times may be in excess of the federally insured limit of $250,000 per bank. The Company minimizes this risk by placing its cash deposits with major financial institutions. As of December 31, 2024 and 2023, the Company had approximately $34,000 and $22,000, respectively, in excess of the federal insurance limit.

~~The~~Prepaid Company follows Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) section 850-10 for the identification of related parties and disclosure of related party transactions.Expenses

~~Pursuant~~Prepaid toexpenses ASC section 850-10-20 the related parties include (a.) affiliates of the Company (“Affiliate” means, with respect to any specified Person, any other Person that, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such Person, as such terms are ~~used~~assets inheld and construed under Rule 405 under the Securities Act); (b.) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option of ASC section 825–10–15, to be accounted for by the ~~equity~~Company ~~method by the investing entity; (c.) trusts for the benefit of employees, such as pension and profit-sharing trusts~~ that are ~~managed~~expected by or under the trusteeship of management; (d.) principal owners of the Company; (e.) management of the Company; (f.) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to ~~an extent that one of the transacting parties might~~ be ~~prevented~~realized ~~from fully pursuing its own separate interests;~~ and ~~(g.)~~consumed ~~other~~within ~~parties~~twelve ~~that~~months ~~can~~after ~~significantly influence~~ the ~~management~~reporting or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interestsperiod.

~~F-8~~Data Center Campus Costs

~~The~~Data ~~consolidated~~center ~~financial~~cost ~~statements~~is ~~shall~~stated ~~include~~at ~~disclosures of material related party transactions~~cost, ~~other~~which ~~than~~includes ~~compensation arrangements, expense allowances, and other similar items in~~ the ~~ordinary~~cost ~~course~~incurred ofto ~~business.~~complete ~~However,~~phase ~~disclosure~~I of ~~transactions that are eliminated in~~ the ~~preparation~~Company’s ofdata ~~consolidated~~center ordevelopment ~~combined financial statements is not required in those statements~~plan. Phase ~~The~~I ~~disclosures~~costs ~~shall~~ include~~: (a.)~~ the ~~nature~~option ofpayment ~~the relationship(s) involved; (b.) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed,~~ for ~~each of~~ the ~~periods~~land ~~for which income statements are presented,~~ and ~~such other information deemed necessary to an understanding of~~ the ~~effects~~cost of ~~the~~consulting ~~transactions~~firms onto ~~the~~provide ~~financial~~power ~~statements; (c.) the dollar amounts of transactions for each of the periods for which income statements are presented~~ and ~~the~~connectivity ~~effects of any change in the method of establishing the terms from that~~assessments, ~~used~~feasibility instudies, ~~the~~engineering ~~preceding~~plans, ~~period;~~ and (dproject benchmarking.) ~~amounts~~Data ~~due~~center ~~from~~cost oralso toincludes ~~related~~internal ~~parties~~cost such as ~~of the date of each balance sheet presented and, if~~payroll-related ~~not~~cost ~~otherwise apparent, the terms~~ and ~~manner~~debt ofinterest ~~settlement~~cost.

~~Commitments~~In ~~and~~accordance ~~Contingencies~~with ASC 360-10-35, the Company reviews the carrying amounts of data center cost when events or changes in circumstances indicate the assets may not be recoverable. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss, if any. Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The ~~Company~~recoverable ~~follows~~amount ~~ASC~~is ~~section~~the ~~450-20~~higher toof ~~report~~fair ~~accounting~~value, ~~for~~less ~~contingencies~~costs of disposal and value in use. ~~Certain~~In ~~conditions~~assessing ~~may~~value ~~exist~~in asuse, the estimated future cash flows to be derived from continuing use of the ~~date~~asset ~~the~~or ~~consolidated financial~~cash-generating ~~statements~~unit are ~~issued,~~discounted ~~which~~to ~~may~~their ~~result~~present invalue using a ~~loss~~pre-tax discount torate that reflects current market assessments of the ~~Company,~~time ~~but~~value ~~which~~of ~~will~~money ~~only~~and bethe ~~resolved~~risks ~~when~~specific ~~one~~to orthe ~~more~~asset. ~~future~~Fair ~~events~~value less ~~occur~~costs orof ~~fail~~disposal tois ~~occur.~~the ~~The~~amount ~~Company~~obtainable ~~assesses~~from ~~such~~the ~~contingent~~sale ~~liabilities,~~of ~~and~~an ~~such~~asset ~~assessment~~or ~~inherently~~cash-generating ~~involves~~unit in an ~~exercise~~arm’s oflength ~~judgment.~~transaction between Inknowledgeable, ~~assessing~~willing ~~loss~~parties, ~~contingencies~~less ~~related~~the tocost ~~legal~~of ~~proceedings~~disposal. ~~that~~When ~~are~~a ~~pending~~binding ~~against~~sale ~~the~~agreement ~~Company~~is ornot ~~un-asserted~~available, ~~claims~~fair ~~that~~value ~~may~~less ~~result~~costs of disposal inis ~~such~~estimated ~~proceedings,~~using ~~the~~a ~~Company~~discounted ~~evaluates~~cash ~~the~~flow ~~perceived~~approach ~~merits~~with inputs and assumptions consistent with those of ~~any~~a ~~legal~~market ~~proceedings~~participant. If the recoverable amount of an asset or uncash-~~asserted~~generating ~~claims~~unit asis ~~well~~estimated asto ~~the~~be ~~perceived merits~~less ofthan its carrying amount, the carrying amount of ~~relief~~the ~~sought~~cash-generating unit oris ~~expected~~reduced to beits ~~sought~~recoverable ~~therein~~amount. An impairment loss is recognized immediately in net income.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.F-9

~~Loss~~As ~~contingencies~~of ~~considered~~December ~~remote~~31, ~~are~~2024, ~~generally~~there ~~not~~have ~~disclosed~~been ~~unless~~no ~~they~~circumstances ~~involve~~to ~~guarantees,~~indicate ~~in which case~~ the ~~guarantees~~asset ~~would~~may not be ~~disclosed~~recoverable.

~~Stock-Based~~Related ~~Compensation~~Parties

WeThe ~~account~~Company ~~for~~follows ~~our~~Financial ~~stock-based~~Accounting ~~compensation~~Standards ~~under~~Board’s ~~ASC 718,~~ (“~~Compensation – Stock Compensation~~FASB”) ~~using~~Accounting ~~the~~Standards ~~fair~~Codification ~~value~~(“ASC”) ~~based~~section ~~method.~~850-10 ~~Under~~for ~~this method, compensation cost is measured at~~ the ~~grant~~identification ~~date based on the value~~ of ~~the~~related ~~award~~parties and isdisclosure ~~recognized~~of ~~over the~~related-party ~~service period, which is usually the vesting period. This guidance establishes standards for the accounting for~~ transactions ~~in which an entity exchanges it equity instruments for goods or services~~. It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of those equity instruments.

WePursuant ~~use~~to ASC section 850-10-20, the ~~fair~~related ~~value~~parties ~~method~~include ~~for~~(a.) ~~equity~~affiliates ~~instruments~~of ~~granted~~the Company (“Affiliate” means, with respect to any ~~non-employees~~specified Person, any other Person that, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such Person, as such terms are used in and ~~use~~construed under Rule 405 under the ~~BSM~~Securities ~~model~~Act); (b.) entities for ~~measuring~~which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option of ~~options~~ASC section 825–10–15, to be accounted for by the equity method by the investing entity; (c.) trusts for the benefit ~~The~~of ~~stock~~employees, ~~based~~such ~~fair~~as ~~value~~pension ~~compensation~~and isprofit-sharing ~~determined~~trusts asthat are managed by or under the trusteeship of management; (d.) principal owners of the ~~date~~Company; (e.) management of the ~~grant~~Company; (~~measurement~~f.) ~~date~~other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g.) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and iscan ~~recognized~~significantly ~~over~~influence the ~~vesting~~other ~~periods~~to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

~~Income~~The ~~Taxes~~consolidated financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a.) the nature of the relationship(s) involved; (b.) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c.) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d.) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

~~The~~Commitments ~~Company accounts for income taxes in accordance with ASC 740, Income Taxes, deferred tax assets~~ and liabilities are computed based on the difference between the financial reporting and income tax bases of assets and liabilities using the enacted marginal tax rate. ASC 740 requires that the net deferred tax asset be reduced by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the net deferred tax asset will not be realized.Contingencies

The Company ~~accounts~~follows ~~for~~ASC ~~income~~section ~~taxes~~450-20 ~~using~~to anreport ~~asset~~accounting ~~and~~for ~~liability~~contingencies. ~~approach,~~Certain ~~which~~conditions ~~requires~~may ~~the~~exist ~~recognition~~as of ~~taxes~~the ~~payable~~date orthe ~~refundable~~consolidated ~~for~~financial ~~the~~statements ~~current~~are ~~year~~issued, ~~and~~which ~~deferred~~may ~~tax~~result ~~liabilities~~in ~~and~~a ~~assets~~loss ~~for~~to the ~~future~~Company, ~~tax~~but ~~consequences~~which ofwill ~~events~~only ~~that~~be ~~have~~resolved ~~been~~when ~~recognized~~one inor ~~the Company’s~~more ~~financial~~future ~~statements~~events occur or ~~tax~~fail ~~returns~~to occur. The ~~measurement~~Company ofassesses ~~current~~such ~~and~~contingent ~~deferred~~liabilities, ~~tax~~and ~~assets~~such ~~and~~assessment ~~liabilities~~inherently isinvolves ~~based~~an onexercise ~~provisions~~ of ~~enacted~~judgment. In ~~tax~~assessing ~~laws;~~loss ~~the~~contingencies ~~effects~~related ofto ~~future~~legal ~~changes~~proceedings inthat ~~tax~~are ~~laws~~pending against the Company or ~~rates~~un-asserted ~~are~~claims ~~not~~that ~~anticipated.~~may Ifresult in ~~necessary~~such proceedings, the ~~measurement~~Company evaluates the perceived merits of ~~deferred tax~~any ~~assets~~legal isproceedings ~~reduced~~or byun-asserted claims as well as the ~~amount~~perceived merits of ~~any~~the ~~tax~~amount ~~benefits~~of ~~that~~relief ~~are~~sought ~~not~~or expected to be ~~realized~~sought ~~based on available evidence~~therein.

F-910

~~The~~If ~~Company~~the ~~has~~assessment ~~adopted~~of ~~guidance~~a ~~related~~contingency toindicates ~~the~~that ~~accounting~~it ~~for~~is ~~uncertainty~~probable inthat ~~income~~a ~~taxes~~material ~~which~~loss ~~prescribes~~has ~~rules~~been ~~for~~incurred ~~recognition, measurement~~ and ~~classification~~the inamount of the ~~financial~~liability can ~~statements~~be ofestimated, ~~tax~~then ~~positions~~the ~~taken~~estimated orliability ~~expected~~would to be ~~taken~~accrued in athe ~~tax~~Company’s ~~return~~consolidated financial statements. ~~The~~If ~~guidance~~the ~~prescribes~~assessment aindicates ~~two-step~~that ~~approach~~a ~~which~~potential ~~involves~~material ~~evaluating~~loss ~~whether~~contingency ais ~~tax~~not ~~position~~probable ~~will~~but beis ~~more~~reasonably ~~likely~~possible, ~~than~~or ~~not~~is ~~(greater~~probable ~~than~~but 50cannot ~~percent~~be ~~likelihood)~~estimated, ~~sustained~~then ~~upon examination based on~~ the ~~technical~~nature ~~merits~~ of the ~~position.~~contingent ~~The~~liability, ~~second step requires that any tax position that meets the more likely than not recognition threshold be measured~~ and ~~recognized~~an inestimate ~~the~~of ~~financial statements at~~ the ~~largest~~range ~~amount~~ of ~~benefit~~possible ~~that is~~losses, aif ~~greater~~determinable ~~than~~and 50material, ~~percent~~would ~~likelihood of being realized upon settlement~~be disclosed.

~~The~~Loss ~~Company’s~~contingencies ~~policy~~considered isremote toare ~~recognize~~generally ~~interest~~not ~~and~~disclosed ~~penalties,~~unless ifthey ~~any~~involve guarantees, ~~related to unrecognized tax benefits~~ in ~~income~~which ~~tax~~case ~~expense. The Company is not currently under examination by any taxing authority nor has~~ the ~~Company~~guarantees ~~been~~would ~~notified~~be ~~of a pending examination~~disclosed. ~~The statute of limitations for which the Company is generally no longer subject to federal or state income tax examinations by tax authorities is for years before 2013.~~

~~Earnings~~Stock-Based ~~Per Share~~Compensation

The Company ~~uses~~accounts ~~ASC~~for ~~260,~~its ~~“Earnings~~stock-based ~~Per~~compensation ~~Share”~~under ~~for~~ASC ~~calculating~~718, ~~the~~“Compensation ~~basic~~– ~~and~~Stock ~~diluted~~Compensation” ~~earnings~~using ~~(loss)~~the fair ~~per~~value-based ~~share~~method. ~~The~~Under ~~Company computes~~this ~~basic~~method, ~~earnings~~compensation ~~(loss)~~cost ~~per~~is ~~share~~measured byat ~~dividing~~the ~~net~~grant ~~income~~date ~~(loss)~~based byon the ~~weighted~~value ~~average number~~ of ~~common~~the ~~shares~~award ~~outstanding.~~and ~~Diluted~~is recognized ~~earnings~~over ~~(loss)~~the ~~per~~service ~~share~~period, which is ~~computed~~usually ~~based on~~ the ~~weighted~~vesting ~~average~~period. ~~number~~This ofguidance ~~shares~~establishes ofstandards ~~common~~for ~~stock plus~~ the ~~effect~~accounting offor ~~dilutive potential~~transactions ~~common~~in ~~shares~~which ~~outstanding~~an ~~during~~entity ~~the~~exchanges ~~period~~its ~~using~~equity ~~the~~instruments ~~treasury~~for ~~stock~~goods ~~method~~or services. ~~Dilutive~~It ~~potential~~also ~~common~~addresses ~~shares~~transactions ~~include~~in ~~outstanding~~which ~~stock options~~an ~~and~~entity ~~warrants~~incurs ~~and~~liabilities in ~~stock~~exchange ~~awards.~~for ~~For~~goods ~~periods~~or ~~with~~services athat ~~net~~are ~~loss,~~based ~~basic~~on ~~and~~the ~~diluted~~fair ~~loss~~value ~~per~~of ~~share~~the isentity’s ~~the~~equity ~~same,~~instruments inor that ~~any~~may ~~potential common~~be ~~stock~~settled ~~equivalents would have~~ by the ~~effect~~issuance of ~~being~~those ~~anti-dilutive~~equity ~~in the computation of net loss per share~~instruments.

The ~~following~~Company ~~table~~uses ~~sets~~the ~~forth~~fair value method for equity instruments granted to non-employees and use the ~~computation~~BSM model for measuring the fair value of ~~basic~~options. ~~and~~The ~~diluted~~stock-based ~~earnings~~fair ~~(loss)~~value ~~per~~compensation ~~share~~is ~~for~~determined as of the ~~years~~date ~~ended~~of ~~December~~the ~~31,:~~grant (measurement date) and is recognized over the vesting periods.

~~SCHEDULE~~Earnings Per ~~OF COMPUTATION OF BASIC AND DILUTED EARNINGS (LOSS) PER SHARE~~Share

Numerator	2023			2022
Net (loss) income	$	(4,630,000	)	$	2,181,000
Effect of dilutive instruments – convertible notes interest		-			204,000
Numerator for diluted EPS	$	(4,630,000	)	$	2,385,000
Denominator
Denominator – for basic EPS		19,157,230			14,495,621
Effect of dilutive instruments
Convertible promissory notes and accrued interest		-			4,125,699
Restricted stock units		-			10,000,000
Warrants issued for services					721,006
Dilutive potential common shares		-			14,846,705
Denominator for diluted EPS		19,157,230			29,342,327
Basic earnings per share	$	(0.24	)	$	0.15
Diluted earnings per share	$	(0.24	)	$	0.08

The Company uses ASC 260, “Earnings Per Share” for calculating the basic and diluted earnings (loss) per share. The Company computes basic earnings (loss) per share by dividing net income (loss) by the weighted average number of common shares outstanding. Diluted earnings (loss) per share is computed based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include outstanding stock options and warrants and stock awards. For periods with a net loss, basic and diluted loss per share is the same, in that any potential common stock equivalents would have the effect of being anti-dilutive in the computation of net loss per share.

Securities that could potentially dilute loss per share in the future were not included in the computation of diluted loss per share for the ~~year~~years ended December 31, 2024 and 2023 because their inclusion would be anti-dilutive. Common stock equivalents amounted to 1311,~~484~~326,~~743~~178 and nil for the ~~year~~ years ended December 31, 2024 and 2023, respectively.

~~F-10~~Recent Accounting Pronouncements

~~Recent~~The ~~Accounting~~Company’s ~~Pronouncements~~management reviewed all recently issued accounting standard updates (“ASU’s”) not yet adopted by the Company and does not believe the future adoptions of any such ASU’s may be expected to cause a material impact on the Company’s consolidated financial condition or the results of its operations.

~~The Company’s~~In ~~management~~October ~~reviewed~~2023, ~~all~~the ~~recently~~FASB issued ASU ~~accounting~~2023-06, ~~standard~~Disclosure ~~updates~~Improvements: ~~(“ASU~~Codification Amendments in Response to the SEC’s”) ~~not~~Disclosure ~~yet~~Update ~~adopted~~and bySimplification ~~the~~Initiative. The ~~Company~~amendments ~~and~~in ~~does~~this ~~not~~Update ~~believe~~modify the ~~future~~disclosure ~~adoptions~~or presentation requirements of ~~any~~a ~~such~~variety ~~ASU’s~~of ~~may~~Topics bein ~~expected~~the Codification. Certain of the amendments represent clarifications to, ~~cause~~or atechnical ~~material~~corrections of the current requirements. Each amendment in the ASU will only become effective if the SEC removes the related disclosure or presentation requirement from its existing regulations by June 30, 2027. We are currently evaluating the impact onthat the ~~Company’s~~adoption of the provisions of the ASU will have on our consolidated financial ~~condition~~statements. orThe amendments in this ASU are not expected to have a material impact on the results of ~~its~~ operations or financial position.

~~Note~~In November 2023, the FASB issued 2ASU –2023-07, ~~Data~~“Segment ~~Center~~Reporting ~~Costs~~(ASC Topic 280): Improvements to Reportable Segment Disclosures.” The amendments require the disclosure of significant segment expenses as well as expanded interim disclosures, along with other changes to segment disclosure requirements. The standard will be effective for fiscal years beginning after December 15, 2023, and interim periods beginning on or after December 15, 2024. We have implemented the provisions of the ASU 2023-07.

~~DATA~~On ~~CENTER~~December ~~COSTS~~ 14, 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires entities to disclose specific rate reconciliations, amount of income taxes separated by federal and individual jurisdiction, and the amount of income (loss) from continuing operations before income tax expense (benefit) disaggregated between federal, state, and foreign. The new standard is effective for the Company for its fiscal year beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard.

~~On March~~In ~~30,~~November ~~2023~~2024, the ~~Company~~FASB ~~signed~~issued ASU an2024-03, ~~option~~“Income ~~agreement~~Statement to- ~~acquire~~Reporting 80Comprehensive ~~acres~~Income ~~of commercially~~-~~zoned~~ ~~land~~Expense inDisaggregation ~~Imperial~~Disclosures ~~County, California~~ (~~the~~Subtopic ~~“Option”~~220-40) ~~for $3,360,000 (“Purchase Price~~”). The amendments ~~Option~~require ~~expires~~the indisclosure ~~September~~of ~~2024.~~specified ~~The~~information ~~Company~~about ~~paid~~certain acosts ~~non-refundable deposit~~and expenses including purchases of ~~$84~~inventory,~~000~~ onemployee compensation, ~~the~~depreciation, ~~signing~~intangible ofasset ~~the~~amortization, ~~Option~~and depreciation, ~~which~~depletion, ~~has~~and ~~been~~amortization recognized as ~~other~~part ~~assets~~of inoil and gas producing activities. It also requires the ~~consolidated~~disclosure ~~balance~~of ~~sheet. The~~a ~~Company~~qualitative isdescription ~~required~~of tothe ~~deposit~~amounts anremaining ~~additional~~in ~~$84,000~~relevant ~~into~~expense ~~escrow~~captions that ~~(“Escrow~~are ~~Funds”)~~not ~~within~~separately 10disaggregated ~~days~~quantitatively ~~after~~as well as the ~~execution~~ total amount of ~~the~~selling ~~purchase~~expenses ~~agreement.~~and, Asin ofannual ~~the~~reporting ~~issuance~~periods, an entity’s definition of ~~these~~selling ~~consolidated~~expenses. ~~financial~~The ~~statements,~~standard ~~the~~will ~~escrow~~be ~~had~~effective ~~not~~for ~~been~~fiscal ~~set~~years beginning after December 15, 2026, and upinterim reporting periods beginning after December 15, 2027. ~~Once~~We are currently evaluating the ~~escrow~~impact isthat ~~set~~the ~~up,~~adoption of the ~~Company~~provisions of the ASU will ~~deposit~~have ~~the~~on ~~$84,000.~~our Ifconsolidated ~~the~~financial ~~Company~~statements. ~~does~~We ~~not~~are ~~exercise~~currently evaluating the ~~Option~~impact bythat ~~September~~the ~~2024,~~adoption of the provisions ~~Escrow~~of ~~funds~~the ASU will behave ~~returned~~on toour ~~the~~consolidated ~~Company~~financial statements.

~~The~~Note ~~Purchase~~2 ~~Price~~– isData ~~payable~~Center with a cash payment of $1,680,000 and the issuance of 840,000 shares of the Company’s common stock (the “Purchase Shares”). At the closing of the purchase (“Closing Date”), if the stock is trading at a value less than $1.00 per share, the Company is required to issue a promissory note in the amount of $840,000, payable on the third anniversary of the closing date, with an interest rate equal to the Secured Overnight Financing Rate plus 2.0%.Costs

~~If the~~DATA ~~Purchase~~CENTER Shares are issued at the Closing Date, the Company has agreed to repurchase the Purchase Shares (the “Put Option”) under specific circumstances. However, the Put Option expires if the Company’s common stock trades above $2.00 per share for 120 consecutive days. If the Company’s common stock trades below $2.00 per share for 10 consecutive days, the Holder has the option for the Company to repurchase the Purchase Shares for $2.00 per share.COSTS

AsOn ofJuly ~~December 31~~22, ~~2023~~2024, the Company ~~has~~entered ~~incurred~~into ~~costs~~an ofoption ~~approximately~~agreement (“Option”) to acquire for a purchase price of $25,~~262~~000,000 a 315-acre parcel of land (“New Property”) in Imperial County, California to be used for the development of the ~~Data~~Company’s Data Center Campus. With the execution of the Option, ~~which~~the ~~includes~~Company ~~approximately~~paid a non-refundable deposit of $~~196~~50,000. The Option has an initial term of ~~capitalized~~one ~~interest~~year ~~related~~and tomay be extended for an additional six-month period by the ~~convertible~~payment ~~promissory~~of ~~notes~~$75,000 on or before July 21, 2025.

~~Note 3 – Accounts Payable and Accrued Expenses~~F-11

~~ACCOUNTS~~On March ~~PAYABLE~~30, ~~AND~~2023, ~~ACCRUED~~the ~~EXPENSES~~Company signed an option agreement (“Initial Option”) to acquire 80 acres of commercially-zoned land (“Initial Property”) in Imperial County, California for $3,360,000 (“Purchase Price”). The Initial Property was optioned to be the land used for the Company’s Data Center Campus. The Company paid a non-refundable deposit of $84,000 on the signing of the Initial Option. On July 24, 2024 (“Termination Date”), the Company terminated (“Termination”) the Initial Option as the Company believes the New Property is better suited for the Company’s Data Center Campus project.

~~The~~As ~~following~~of ~~table~~the ~~summarizes~~Termination Date, the Company’s ~~accounts~~had ~~payable~~approximately $4,158,000 of cost (“DCC Cost”) for the Data Center Campus project. In accordance with ASC 790 and ~~accrued~~360, ~~expense~~the ~~balances~~Company asis required to determine the amount of ~~December~~DCC 31Cost (“Option Cost”) associated with the Initial Property. The Option Cost is required to be exposed on the date the Company abandoned the Initial Option. The Company has determined the date of abandonment was the Termination Date. As of the Termination Date,: the Company had approximately $344,000 of Option Cost. The remaining DCC Cost are related to the development activities to the overall Data Center Campus, as such are not cost associated with the Initial Property.

~~SCHEDULE~~As OFof ~~ACCOUNTS~~December ~~PAYABLE~~31, ~~AND~~2024, ~~ACCRUED~~the ~~EXPENSES~~Company has incurred DCC Cost of approximately $5,849,000, which includes approximately $284,000 of capitalized interest related to the interest calculated for the funds, from the Notes payable and Convertible promissory notes, used for the DCC development expenditures.

	2023		2022
Accounts payable	$	218,000	$	186,000
Accrued expenses		330,000		28,000
Accrued interest		122,000		326,000
Accounts payable and accrued expenses	$	670,000	$	540,000

Note 3 – Notes Payable

~~Accrued Interest~~NOTES PAYABLE

~~The~~Notes ~~following~~payable ~~table~~transactions ~~presents~~for the ~~details~~year ofended ~~accrued~~December ~~interest~~31, asare ofsummarized ~~December~~as ~~31,~~follows:

SCHEDULE OF ~~ACCRUED~~NOTES ~~INTEREST~~PAYABLE

	2023			2022
	2024			2023
Notes payable	$	7,000		$	17,000
Principal
Convertible promissory notes		115,000			309,000
Balance, beginning of the period	$	11,000		$	61,000
Balance, end of period	$	122,000		$	326,000
Additions – related party		1,000,000			-
Settlement – related party		(1,000,000	)		(50,000	)
Balance, end of the period		11,000			11,000
Discount
Balance, beginning of the period		-			-
Additions – related party		2,355,000			-
Amortization – related party		2,355,000			-
Balance, end of the period		-			-
Net carrying amount	$	11,000		$	11,000

FIn February 2024, the Company issued a promissory note (“Promissory Note”) in the principal amount of $1,000,000 that bears interest at the rate of 10% per annum and originally matured on May 31, 2024 (“Maturity Date”). It also issued a five-11year warrant to purchase up to 200,000 shares of common stock with an initial exercise price of $0.50 per share (“Finance Warrant”).

In accordance with ASC 470 - Debt, the Company has allocated $1,000,000 of cash proceeds on a relative fair value to the Promissory Note and the Finance Warrant. The Finance Warrant was valued using the Black Scholes option pricing model for a total fair value of approximately $1,389,000 based on a 2.5-year term, volatility of 159%, a risk-free equivalent yield of 4.1%, –and ~~Notes~~a ~~Payable~~stock price of $7.21. The Finance Warrant was ascribed a relative fair value of approximately $581,000.

~~NOTES PAYABLE~~F-12

~~The~~On ~~table~~the ~~below~~Maturity ~~summarizes~~Date, the ~~transactions~~holder ~~for~~of the ~~year~~Promissory ~~ended~~Note ~~December~~agreed to extend the Maturity Date to August 31,: 2024 (“Extension Maturity”). As consideration for the Extension, the Company issued to the holder a warrant to purchase 300,000 shares of the Company’s common stock with an initial exercise price of $3.50 per share (“Extension Warrant”).

~~SCHEDULE~~The OFExtension ~~NOTES~~Warrant ~~PAYABLE~~was valued using the Black Scholes option pricing model for a total fair value of approximately $853,000 based on a 2.5-year term, volatility of 163%, a risk-free equivalent yield of 4.3%, and a stock price of $3.5. The fair value of $853,000 was recorded as a debt discount to be amortized over the Extension period of three months. As of December 31, 2024, the Company had amortized approximately $853,000 of the value of the Extension Warrant.

	2023			2022
Balance, beginning of the year	$	61,000		$	61,000
Additions		–			–
Conversion		(50,000	)		–
Balance, end of the year	$	11,000		$	61,000

On the Extension Maturity date, the holder of the Promissory Note agreed to extend the Extension Maturity to December 31, 2024 (“Additional Extension”). As consideration for the Additional Extension date, the Company issued to the holder a warrant to purchase 300,000 shares of the Company’s common stock with an initial exercise price of $3.80 per share (“Additional Extension Warrant”).

OnThe ~~July~~Additional 7,Extension ~~2020,~~Warrant ~~the~~was ~~Company~~valued ~~issued~~using athe ~~promissory~~Black ~~note~~Scholes inoption ~~the~~pricing ~~principal~~model ~~amount~~for ofa ~~$11,000.~~total ~~The~~fair ~~note~~value isof ~~noninterest~~approximately ~~bearing. The principal~~$921,000 ~~was~~based ~~due~~ on ora ~~before~~2.5-year ~~March 11~~term, ~~2022.~~volatility ~~During any event~~ of ~~default under the note~~162%, ~~the~~a ~~interest~~risk-free ~~rate~~equivalent ~~shall~~yield ~~increase to 10% per annum. Events~~ of ~~default include failure to pay principal or interest~~3.8%, ~~breach of covenants, breach of representations~~ and ~~warranties, borrower’s assignment of~~ a ~~substantial~~stock ~~part~~price of ~~its~~$3.80. ~~property~~The orfair ~~business,~~value ~~any~~of ~~money judgment~~$921,000 was ~~writ,~~recorded oras ~~similar~~a ~~process~~debt ~~shall~~discount to be ~~entered~~amortized orover ~~filed against~~ the ~~borrower~~Additional orExtension ~~any~~period ~~subsidiary~~ of ~~the~~four ~~borrower~~months. orAs ~~any~~ of ~~its~~December ~~properties or other assets for more than $100~~31,~~000,~~ ~~bankruptcy~~2024, ~~liquidation~~the Company ofhad ~~business,~~amortized ~~and~~approximately ~~cessation of operations. The principal and interest amount outstanding under this note was~~ $11921,000 ~~and~~of ~~$4,000,~~the ~~respectively, as~~value of ~~December~~the ~~31,~~Extension ~~2023~~Warrant.

On ~~April~~December 2215, ~~2021~~2024 (“Exchange Date”), the Company ~~issued~~entered ainto ~~promissory~~an ~~note~~exchange inagreement ~~the principal amount of $50,000~~ (“~~2021~~Exchange ~~Note~~Agreement”). to ~~The~~settle ~~interest~~the Promissory Note based on the ~~unpaid~~ ~~principal~~Exchange ~~balance~~Agreement, ~~accrues~~the atPromissory aNote ~~rate~~was ofextinguished, ~~10%~~as ~~per~~of ~~annum.~~the ~~The~~Exchange ~~principal~~Date and ~~any~~the Extension ~~accrued~~Warrant ~~interest~~and ~~was~~Additional toExtension beWarrants ~~paid~~(collectively in“The aExtension ~~single~~Warrants”) ~~installment on~~were orcancelled. ~~before~~In exchange ~~April~~the ~~22,~~Company ~~2022.~~(i) Ifmade ~~the~~a ~~Company~~payment ~~fails~~of to$100,000 ~~pay~~for the ~~balance~~accrued ofand ~~this~~unpaid ~~note~~interest, in(ii) ~~full~~issued on500,000 shares of the Company’s ~~date~~common orstock ~~fails~~with toa ~~make~~fair ~~any~~value ~~payments~~of ~~due~~$1.75 ~~within~~per 15share ~~days~~(based ofon the ~~due~~Company’s ~~date,~~closing ~~any~~on ~~unpaid~~the ~~principal~~Exchange ~~shall~~Date) ~~accrue~~(“Exchange ~~interest~~Shares”), atand ~~the~~issued ~~rate~~a ofwarrant ~~15%~~to ~~per~~purchase ~~annum~~2,258,877 shares ~~during~~of the ~~default.~~Company’s ~~Events~~common ~~of default~~stock ~~include~~as ~~failure~~a toprice ~~make~~of ~~any~~$2.00 per ~~payment~~share ~~including~~for ~~accrued~~a ~~interest~~period ~~when~~of ~~due,~~five years ~~voluntary,~~(“Exchange orWarrant’). ~~involuntary~~On ~~petition~~the ofExchange ~~bankruptcy,~~Date ~~appointment of~~the aExchange ~~receiver,~~Warrant ~~custodian,~~had ~~trustee~~a orfair ~~similar~~value ~~party~~of to$3,196,000 calculated ~~take~~using ~~possession~~the ofBlack ~~the~~Scholes ~~Company’s~~fair ~~assets~~value oroption-pricing ~~property,~~model orwith ~~assignment~~key ~~made~~input ~~by the~~variables ~~Company~~provided ~~for~~by ~~the~~management: ~~benefit~~volatility of ~~creditors.~~166%, the ~~The~~fair ~~principal~~value ~~and~~of ~~interest~~common ~~amount~~stock ~~outstanding~~$1.75, estimated ~~under~~life ~~this~~range ~~note~~2.5 years, ~~was~~risk-free ~~$11,000~~rate of 4.25% and ~~$7,000,~~dividend ~~respectively, December~~rate ~~31,~~of ~~2023~~nil.

InThe ~~December 2023, the~~ Company ~~offer~~accounted for the ~~2021~~Exchange ~~Note~~agreement ~~holder~~in toaccordance ~~convert,~~with ~~without~~ASC a470 ~~time~~– ~~limit~~Debt. Therefore, the ~~principal and interest into the~~ Company~~’s common~~ ~~stock~~incurred at a ~~price of~~ $~~0.96 per share. The holder agreed to convert the principal and interest of approximately $50~~2,~~000 and $17~~317,000, ~~respectively,~~loss ~~(total~~on ~~$67~~extinguishment,~~000)~~ ~~for~~which ~~196,010~~was ~~shares of~~ the ~~Company’s~~difference ~~common~~between ~~stock~~the ~~with a~~ fair ~~market~~ value of ~~approximately~~The ~~$188,000 as~~Extension ofWarrants ~~the~~compared ~~date of conversions. As the terms of the conversion the Holders did not provide any concession~~ to the ~~Company~~aggregate and there was not an inducement to Holders to convert, because the offer did not have a time limit, the Company has accounted for the conversion in accordance with ASC 470-50-40-4. The difference between the fair value of the ~~consideration~~Exchange ~~paid~~Warrants ~~of approximately $188,000~~ and ~~the liability~~Exchange ~~of $67,000 was approximately $121,000, which was accounted for a loss on liability settlement~~Shares. The loss on ~~settlement was recorded as loss on~~ extinguishment of ~~debt~~note onpayable ~~the~~– ~~statement~~related ofparty ~~operations~~was calculated ~~for~~as ~~the year ended December 31, 2023.~~follows:

~~Interest~~SCHEDULE ~~expense~~OF onLOSS ~~these~~ON ~~notes~~EXTINGUISHMENT ~~payable~~OF ~~amounted~~NOTE toPAYABLE ~~$9,000~~RELATED ~~and $14,000 for the years ended December 31, 2023 and 2022, respectively.~~PARTY

Note 5 – Convertible Promissory Notes


Loan - principal balance	$	1,000,000
Value The Extension Warrants - cancelled		755,000
Total Consideration		1,755,000

Share received		500,000
Stock price		1.75
Common stock value		875,000
Value of Exchange Warrant		3,197,000
Value received		4,072,000
Loss on extinguishment of note payable – related party	$	2,317,000

~~CONVERTIBLE PROMISSORY NOTES~~F-13

~~Convertible~~On ~~promissory~~the ~~notes~~Exchange ~~consisted~~Date the 600,000 Extension Warrants had a fair value of $755,000 calculated using the ~~following~~Black asScholes fair value option-pricing model with key input variables provided by management: volatility of ~~December~~166%, the 31fair value of common stock $1.75,: estimated life range 2.5 years, risk-free rate of 4.25% and dividend rate of nil.

~~SCHEDULE~~Interest OFexpense ~~CONVERTIBLE~~on ~~PROMISSORY~~the ~~NOTES~~Promissory Note amounted to $103,000 and $9,000 for the years ended December 31, 2024 and 2023, respectively, of which approximately $60,000 and nil, respectively, were capitalized as data center development cost.

	2023			2022
Principal
Balance, beginning of year	$	4,613,000		$	4,613,000
Additions		–			–
Conversion		(4,272,000	)
Balance, end of year		341,000			4,613,000
Discount
Balance, beginning of year		–			1,526,000
Additions		–			–
Amortization		–			(1,526,000	)
Balance, end of year		–			–
Net carrying amount	$	341,000		$	4,613,000

Note 4 – Convertible Debentures

~~F-12~~CONVERTIBLE DEBENTURES

~~The~~Convertible ~~effective~~debentures ~~interest~~transactions ~~rate used to amortize the debt discount~~ for the ~~year~~years ended December 31, ~~2022~~are ~~ranged~~summarized ~~from~~as ~~4.76% to 64.60%.~~follows:

InSCHEDULE ~~December~~OF ~~2023,~~CONVERTIBLE the Company offered each of the Convertible Promissory Note holders (“Holders”) to convert, without a time limit, the principal and interest into the Company’s common stock at a price ranging from $0.51 to $0.54 per share. As of December 31, 2023 approximately five of the Holders agreed to convert principal and interest of approximately, $4,272,000 and $634,000, respectively, (total $4,906,000) for 9,656,019 shares of the Company’s common stock with a fair market value of approximately $5,771,000 as of the date of conversions. As the terms of the conversion was not in accordance with the original conversion feature, the Holders did not provide any concession to the Company and there was not an inducement to Holders to convert, because the offer did not have a time limit, the Company has accounted for the conversion in accordance with ASC 470-50-40-4. The difference between the fair value of the consideration paid of approximately $5,771,000 and the liability of $4,906,000 was approximately $865,000, which was accounted for as a loss on liability settlement. The loss on settlement was recorded as loss on extinguishment of debt on the statement of operations for the year ended December 31, 2023.DEBENTURES

Interest expense on default convertible promissory notes amounted to $439,000 and $204,000 for the year ended December 31, 2023, respectively, of which $214,000 and nil was capitalized as data center cost, respectively.

Principal	2024			2023
Balance, beginning of period	$	341,000		$	4,613,000
Additions		1,410,000			-
Conversions		(341,000	)		(4,272,000	)
Balance, end of period		1,410,000			341,000

Debt issuance cost
Balance, beginning of period		-			-
Additions		106,000			-
Amortization		(9,000	)		-
Balance, end of period		97,000			-

Net book value	$	1,313,000		$	341,000

~~Note~~In 6June –2024, ~~Commitments~~the Company initiated a private place offering for its convertible promissory notes (the “Debentures”). As of December 31, 2024, the net proceeds were approximately $1,304,000, due to approximately $106,000 paid as debt issuance cost in connection with the issuance of the Debentures. The Debentures bears interest at 10.0% per annum with a default interest rate of 15.0% per annum. The principal amount and ~~Contingencies~~all accrued interest are payable on December 31, 2026. The holder of the Debentures has the option to convert the unpaid principal and interest into shares of the Company’s common stock at the conversion rate of $2.00 per share, subject to adjustment for stock splits, stock dividends and the like and for issuances by the Company of common stock at a price per share that is less than the then-current conversion price, subject to certain exceptions.

~~COMMITMENTS AND CONTINGENCIES~~F-14

~~Litigation~~In accordance with the Debenture, the Company has the right to prepay the Debentures upon providing 45 days of its intention to prepay.

~~From~~The ~~time~~outstanding toprincipal ~~time,~~amount of the ~~Company~~Debentures ~~may~~and ~~become~~all ~~subject~~accrued tointerest ~~legal~~thereon ~~proceedings,~~shall ~~claims,~~automatically ~~and~~be ~~litigation~~converted ~~arising~~into inshares of common stock at the ~~ordinary~~then ~~course~~effective conversion price upon (i) the close of business. on the sixtieth (60th) consecutive day on which the VWAP ~~The~~of the Company’s iscommon ~~not~~stock ~~currently~~is aat ~~party~~least to$4.00 ~~any~~per ~~material~~share, ~~legal~~subject ~~proceedings,~~to ~~nor~~appropriate isadjustment in the ~~Company~~event ~~aware~~ of any ~~pending~~stock dividend, stock split, stock combination or ~~threatened~~other ~~litigation that~~similar ~~would~~recapitalization ~~have~~with arespect ~~material~~to ~~adverse~~the ~~effect~~common onstock, or (ii) the execution by the Company’s of ~~business,~~a ~~operating~~long-term ~~results,~~lease ~~cash~~with ~~flows,~~a data center client for all or ~~financial~~a ~~condition~~substantial ~~should such~~portion ~~litigation~~of bethe ~~resolved~~Company’s ~~unfavorably~~planned data center development project.

~~Employment~~In ~~Agreement~~December 2023, the Company offered the holders of the Company’s outstanding convertible promissory notes in the aggregate principal amount of $341,000 the option to convert such notes into the Company’s common stock at a price ranging from $0.51 to $0.54 per share. During the three months ended March 31, 2024, the Company converted principal and interest of approximately $341,000 and $119,000, respectively (a total of $460,000), for 884,942 shares of the Company’s common stock with a fair market value of approximately $6,928,000 as of the dates of conversion. As the terms of the conversion were not in accordance with the original conversion feature, the holders of such notes did not provide any concession to the Company, and there was not an inducement to the holders to convert. As the offer did not have a time limit, the Company has accounted for the conversion in accordance with ASC 470-50-40-4. The difference between the fair value of the consideration paid of approximately $6,928,000 and the liability of $460,000 was approximately $6,468,000, which was accounted for as a loss on liability settlement. The loss on the settlement was recorded as a loss on extinguishment of debt on the statement of operations for the three months ended March 31, 2024.

InInterest ~~June~~expense ~~2023,~~on ~~the~~these ~~Company~~convertible ~~executed~~promissory annotes ~~employment~~amounted ~~agreement (“Employment Agreement”)~~ to ~~employ an individual to be the Company’s~~$32,000 ~~President~~ and ~~Chief Operating Officer (“Executive” or “COO”). As compensation for services rendered, the Executive will be paid a base salary of~~ $~~250~~439,000 ~~per annum. The Executive’s base salary may be increased as certain milestones are met, such~~ asfor ~~1) when~~ the ~~necessary~~years ~~governmental~~ended ~~permits~~December ~~are granted to start construction of the Data Center~~31, ~~2) once the Data Center is operational~~2024 and ~~at least 25% of the planned MW’s of collation capacity is leased. Also~~2023, ~~at the discretion of the Company~~respectively, ~~following each calendar year~~ of ~~continued~~which ~~employment~~$21, ~~the Executive shall be eligible to receive a discretionary bonus of up to fifty percent (50%) of Executive’s~~000 ~~base~~and ~~salary during the first year of employment~~$203, ~~up to seventy-five percent (75%) of Executive’s then-current base salary during the second year of employment~~000, ~~and up to one-hundred percent (100%) of Executive’s then-current base salary during Executive’s~~ ~~third year of employment (the “Bonus”). Payment of the Bonus will be based on achieving certain goals and performance criteria established by the Company. In addition~~respectively, ~~the Executive~~ was ~~granted~~capitalized ~~options~~as toData ~~purchase~~Center ~~600,000~~Campus ~~and 1,900,000 shares of the Company’s common stock (see Note 7 – Stockholders Deficit) for further information~~Cost.

~~The~~Note ~~Employment~~5 ~~Agreement~~– ~~also~~Commitments provides for certain severance benefits upon termination by the Company without “cause” or by the Executive for good reason. In the event of a termination by the Company without cause or by the Executive for good reason after the first full year of employment, the Executive would be entitled to (i) continued payment of the base salary for the lesser of six months or the remaining term of the Employment Agreement, subject to the Executive signing a timely and effective separation agreement containing a release of all claims against the Company and other customary terms; provided, however, that if such termination is between the 91st day and the end of the first year of employment, the Executive will be entitled to a pro-rata portion of such payment.Contingencies

~~F-13~~COMMITMENTS AND CONTINGENCIES

~~Note 7 – Stockholders Deficit~~Litigation

~~STOCKHOLDERS~~From time ~~DEFICIT~~to time, the Company may become subject to legal proceedings, claims and litigation arising in the ordinary course of business. The Company is not currently a party to any material legal proceedings, nor is the Company aware of any pending or threatened litigation that would have a material adverse effect on the Company’s business, operating results, cash flows or financial condition should such litigation be resolved unfavorably.

~~June~~Employment ~~2023 – Stock Options~~Agreement

AsChief ~~part~~Operating of the Employment Agreement, as defined in Note 6 – Commitments and Contingencies, the executive was granted an incentive stock option (“Incentive Option”) and a non-qualified stock option (“Non-Qual Option”) (collectively “Stock Options”) to purchase 600,000 and 1,900,000, respectively, shares of the Company’s common stock for $0.50 per share. The Stock Options are exercisable for a period of seven years from the date of grant, which was June 19, 2023 (“Grant Date”).Officer

~~The~~In ~~Incentive~~June ~~Option~~2023, ~~shall~~the ~~vest~~Company ~~and~~executed ~~become~~an ~~exercisable~~employment asagreement ~~follows:~~ (i“Employment Agreement”) ~~options~~ to ~~purchase~~employ upan individual to ~~200,000 shares~~be ofthe ~~Common~~Company’s President ~~Stock~~and ~~shall~~Chief ~~vest~~Operating ~~and~~Officer ~~become exercisable~~(“Executive”). onAs ~~the~~compensation ~~first~~for ~~anniversary~~services ofrendered, the ~~Grant~~Executive ~~Date;~~will ~~(ii)~~be ~~options~~paid toa base ~~purchase~~salary upof ~~to 200~~$250,000 ~~shares~~ ofper ~~Common~~annum. ~~Stock~~The ~~shall~~Executive’s ~~vest~~base ~~and~~salary ~~become exercisable~~may onbe ~~the~~increased ~~second~~as ~~anniversary~~certain ofmilestones ~~the~~are ~~Grant~~met, ~~Date;~~such ~~and~~as ~~(iii~~1) ~~options~~when the tonecessary ~~purchase~~governmental uppermits are granted to ~~200,000 shares~~start construction of ~~Common~~the ~~Stock~~Company’s ~~shall~~initial ~~vest~~data ~~and~~center, ~~become exercisable~~2) ononce the ~~third~~initial data ~~anniversary~~center ofis ~~the~~operational ~~Grant~~and ~~Date;~~at ~~provided~~least ~~that~~25% of the ~~Optionee~~planned ismegawatts anof ~~employee~~collation incapacity ~~good~~is ~~standing~~leased. ~~with~~Also, at the ~~Company~~discretion onof the ~~such~~Company, ~~applicable~~following ~~vesting~~each ~~date.~~calendar ~~The~~year ~~Incentive~~of ~~Option~~continued ~~Grant~~employment, ~~Date~~the ~~fair~~Executive ~~value~~shall ofbe ~~$300,000 was~~eligible ~~calculated~~to ~~using~~receive ~~the~~a ~~Black~~discretionary ~~Scholes~~bonus ~~fair~~of ~~value~~up to ~~option-pricing~~fifty ~~model~~percent ~~with~~(50%) ~~key~~of ~~input~~Executive’s ~~variables~~base ~~provided~~salary byduring ~~management, as~~the first year of ~~the~~employment, ~~date~~up ofto ~~issuance:~~seventy-five ~~volatility~~percent (75%) of ~~339%,~~Executive’s ~~the~~then-current ~~fair~~base ~~value~~salary ofduring ~~common~~the ~~stock~~second ~~$0.50, estimated~~year ~~life~~ of ~~5 years~~employment, ~~risk~~and up to one-~~free~~hundred ~~rate~~percent (100%) of ~~3.99%~~Executive’s then-current ~~and~~base ~~dividend~~salary ~~rate~~during Executive’s third year of $0employment. ~~For~~ ~~the~~Payment ~~year~~of ~~ended~~any ~~December~~bonus ~~31,~~will ~~2023,~~be ~~approximately~~based ~~$98,000~~on achieving certain goals and performance ~~was~~criteria ~~earned.~~established Ofby the ~~amount~~Company. ~~earned~~In ~~of $98~~addition,~~000 approximately~~ ~~$74,000~~ the Executive was ~~capitalized~~granted asoptions ~~date~~to ~~center~~purchase ~~cost~~600,000 and ~~the remaining $24~~1,900,000 ~~was~~ ~~expensed~~shares asof ~~stock-based~~the ~~compensation~~Company’s common stock.

~~The Non~~F-~~Qual Option shall vest and become exercisable as follows:~~15

	(1)	216,666 shares on each of the first two anniversaries of the Grant Date and 216,668 shares on the third anniversary of the Grant Date, provided that the Optionee is an employee or Board member in good standing with the Company on such applicable vesting date.
	(2)	the remaining 1,250,000 shares based on the Company completing the following milestones:

The Employment Agreement also provides for certain severance benefits upon termination of the Executive by the Company without “cause” or by the Executive for good reason. In the event of a termination by the Company without cause or by the Executive for good reason after the first full year of employment, the Executive would be entitled to (i) continued payment of the base salary for the lesser of six months or the remaining term of the Employment Agreement, subject to the Executive signing a timely and effective separation agreement containing a release of all claims against the Company and other customary terms.

a.Vice President ~~250,000 shares upon completion~~ of ~~the initial site development plan and~~ Data Center ~~design, and submission of a complete set of plans to Imperial County Planning and~~ Development Department for approvals and permits. b. 250,000 shares upon the Company receiving permits necessary to start construction of the data center site and facilities (including but not limited to power substation, water delivery, pumping, storage and on-site distribution systems, fiber conduit lines and communications systems, and on-site roads, water, power and communications grid, warehousing, offices, administration, support and security buildings, perimeter walls and security systems). c. 250,000 shares upon the completion of construction of a complete data center facility and receipt of an occupancy permit for such facility, either for a Data Center facility to be built as a “build to suit” building for a hyperscale company or as a wholesale colocation building for enterprise IT customers. d. 500,000 shares upon signing a build-to-suit contract or one or more contracts being signed for 50% or more of a constructed and operational wholesale colocation facility’s capacity.

~~The~~On ~~Company’s~~March ~~management~~1, ~~has~~2024, ~~accounted for~~ the ~~Non-Qual Option in accordance with ASC 718 – Stock Compensation (“ASC 718”). ASC 718 requires the~~ Company tohired ~~estimate~~an ~~the~~individual ~~service~~as ~~period~~vice ~~over~~president ~~which~~of ~~the~~data ~~compensation~~center ~~cost~~development ~~will~~with bean ~~recognized.~~annual ~~Management~~salary ~~has~~of ~~estimated~~$225,000. ~~that~~The ~~the~~salary ~~first~~increases ~~development~~to ~~phase (a) will be completed by March 31~~$240,000 and ~~2024~~$250,000 on the ~~second~~first ~~development~~and ~~phase~~second ~~(b)~~anniversary ~~by September 30~~dates, ~~2024,~~respectively. ~~the~~Also, ~~third~~the ~~development~~individual ~~phase~~is ~~(c)~~eligible byfor ~~March~~an ~~31,~~annual ~~2025~~bonus ~~and~~of ~~the~~up ~~fourth~~to ~~development phase by September 30~~25%, ~~2025.~~35% ~~The~~and ~~estimated~~40% ~~service~~of ~~period~~the ~~will be~~annual ~~adjusted~~salary for ~~actual~~the ~~and expected completion date changes. Any such change will be recognized prospectively~~first, second and ~~the remaining deferred~~third ~~compensation~~calendar ~~will~~years, ~~be recognized over the remaining service period~~respectively.

~~F-14~~Chief Strategy and Development Officer

~~The~~On ~~Non-Qual~~April ~~Option~~1, ~~Grant Date fair value of $875~~2024,~~000 was~~ ~~calculated using~~ the ~~Black~~Company ~~Scholes~~hired ~~fair~~an ~~value option-pricing~~individual ~~model with key input variables provided by management,~~ as ofchief ~~the~~strategy ~~date~~and ofdevelopment ~~issuance:~~officer ~~volatility~~vice ~~range~~president ofwith ~~137% to~~an ~~338%, the~~annual ~~fair~~salary ~~value~~ of ~~common stock~~ $~~0.50~~250,000. ~~estimated~~The ~~life~~salary ~~range~~increases ~~of 3.9 years~~ to ~~5.0 years~~$275,000 ~~risk-free~~and ~~rate~~$300,000 ~~range~~on ofthe ~~3.99% to~~first ~~5.24%~~ and ~~dividend~~second ~~rate~~anniversary ofdates, $0respectively. ~~The~~ ~~calculated~~Also, ~~compensation~~the ~~for~~individual ~~the~~is ~~year~~eligible for ~~ended~~an ~~December~~annual ~~31,~~bonus ~~2023~~of ~~was~~up ~~approximately~~to ~~$279~~25%,~~000 of~~ ~~which~~35% ~~$209,000 was~~and ~~capitalized~~40% asof ~~data~~the ~~center~~annual ~~development~~salary ~~cost and~~for the ~~remaining $70~~first,~~000~~ ~~was~~second ~~expensed~~and asthird ~~stock-based~~calendar ~~compensation~~year end, respectively.

~~December~~Note ~~2023~~6 ~~Stock~~– ~~Options~~Stockholders Equity

~~In December~~STOCKHOLDERS 2023, the Board of Directors approved the issuance of stock options to the directors for the purchase of 500,000, 750,000 and 404,000 of the Company’s common stock, for a total of 1,654,000 shares, to the three directors (“Directors Options”) for an exercise price of $0.54, which was the fair market value of the Company’s common stock on the date of issuance. The Director Options vested on December 31, 2023 and expire on December 29, 2030.EQUITY

~~The~~Stock ~~Director~~ Options grant date fair value of approximately $860,000 was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management as of the date of issuance: volatility of 224.03%, the fair value of common stock $0.54, estimated life of 3.5 years, risk-free rate of 4.12% and dividend rate of $0. The Director Options grant date fair value of $860,000 was included in the equity-based compensation in the Statement of Operations for the year ended December 31, 2023.

InOn ~~December~~November ~~2023~~15, 2024, the ~~Board~~Company ofissued, ~~Directors~~to ~~approved~~a ~~the~~consultant, ~~issuance~~a ofnon-qualified stock ~~options~~option to ~~the Company’s CEO and COO for the~~ purchase ~~of 1~~350,000~~,000 and~~ ~~1,000,000,~~shares ~~respectively~~of ~~(“2023~~the ~~Executive~~Company’s common ~~Options”)~~stock ~~for~~at an exercise price of $05.~~54,~~00 ~~which~~per ~~was~~share, the fair market value of the Company’s common stock onas ~~the date~~ of ~~issuance.~~November ~~The 2023 Executive Options vest~~15, as2024 (the ~~follows:~~“Grant Date’).

The ~~both the CEO and COO 1~~350,000~~,000~~ options ~~vest~~vests ~~and become exercisable~~ as follows:

	(1)	166,667 shares on each of December 6, 2024, 2025 and 2026 for a total of 500,000 shares, upon vesting the options have life of seven years.
	(2)	the remaining 500,000 shares based on the Company completing the following milestones (upon vesting the options have a life of seven year):

	●	43,750 shares on each of the following dates July 16, 2025, July 17, 2026, July 16, 2027 and July 16,2028;
	●	Phase (a) 17,500 shares upon the award of a GMP contract to a construction manager/company;
	●	Phase (b) 35,000 shares upon completion of the initial site development plan and data center design and 100% construction documents;
	●	Phase (c) 17,500 shares upon the Company receiving permits necessary to start construction of the data center site and facilities (including but not limited to power substation, water delivery, pumping, storage and on- site distribution systems, fiber conduit lines and communications systems, and on-site roads, water, power and communications grid, buildings, perimeter walls and security systems);
	●	Phase (d) 35,000 upon the completion of all Network Ready meet me rooms in the first data center; and
	●	Phase (e) 70,000 shares upon the completion of construction of a customer-ready data center facility and receipt of a conditional occupancy permit for a Data Center facility.

a. 100,000 shares upon completion of the initial site development plan and Data Center design, and submission of a complete set of plans to Imperial County Planning and Development Department for approvals and permits. b. 100,000 shares upon the Company receiving permits necessary to start construction of the data center site and facilities (including but not limited to power substation, water delivery, pumping, storage and onF- site distribution systems, fiber conduit lines and communications systems, and on-site roads, water, power and communications grid, warehousing, offices, administration, support and security buildings, perimeter walls and security systems). c. 100,000 shares) upon the completion of construction of a complete data center facility and receipt of an occupancy permit for such facility, either for a Data Center facility to be built as a “build to suit” building for a hyperscale company or as a wholesale colocation building for enterprise IT customers. d. 200,000 shares) upon the signing of a build-to-suit contract or one or more contracts being signed for 50% or more of a constructed and operational wholesale colocation facility’s capacity.16

The Company’s management has accounted for the ~~2023~~options ~~Executive Options~~ in accordance with ASC 718 – Stock Compensation (“ASC 718”). ASC 718 requires the Company to estimate the service period over which the compensation cost will be recognized. Management has estimated that the first development phase (a) will be completed by ~~October~~June 30, ~~2024~~2026, the second development phase (b) by ~~February~~ December 31, 2025, the third development phase (c) by ~~April~~March 131, ~~2025~~2026, and the fourth and fifth development ~~phase~~phases (d) and (e) by ~~September~~June 130, ~~2026~~2029. The estimated service period will be adjusted for actual and expected completion date changes. Any such change will be recognized prospectively, and the remaining deferred compensation will be recognized over the remaining service period.

The ~~2023~~option ~~Executive Options~~ grant date fair value of $1,~~060~~727,000 was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance: volatility range ~~of 232~~217.674% to ~~235~~233.040%, the fair value of common stock $05.5000, estimated life range of 4.5 ~~years~~ to 45.773 years, risk-free rate of range 4.123% and dividend rate of $0nil. For the ~~year~~years ended December 31, 2024 and 2023, the Company recorded compensation expenses of approximately $59124,000, ofand ~~which~~nil, ~~approximately $21~~respectively,~~000 was~~ ~~expensed~~which ~~as compensation expense and approximately $38,000~~ was capitalized as data center cost.

FOn April 1, 2024 for the Chief Strategy and Development officer, the Company awarded a non-15qualified stock option to purchase 1,000,000 shares of the Company’s common stock at a purchase price of $2.62, which was the fair market value of the Company’s common stock on the date of issuance.

InThe ~~December 2023~~1, ~~the Board of Directors approved the issuance of stock options to two consultants, an executive advisor and data center development advisor, for the purchase of 350,~~000 ~~and 350~~,000~~, for~~ ~~each~~options ~~consultant~~vests ~~(collectively~~as ~~“2023 Consultant Options”) for an exercise price of $0.54, which was the fair market value of the Company’s common stock on the date of issuance.~~follows:

~~The~~● ~~350~~168,750 shares on the date of issuance; ● 168,750 shares on each the 1st, 2nd and 3rd anniversary dates of the issuance date; ● Phase (a) 32,500 shares upon the Award of a GMP contract to a construction manager/company; ● Phase (b) 65,000 ~~options~~shares ~~for~~upon completion of the initial site development plan and data center ~~development~~design ~~consultant~~and ~~vest~~100% construction documents; ● Phase (c) 32,500 ~~as follows:~~shares upon the Company receiving permits necessary to start construction of the data center site and facilities; ● Phase (d) 65,000 shares upon the completion of an all-network ready meeting rooms in the first data center; and ● Phase (e) 130,000 shares upon the completion of construction of a customer-ready data center facility and receipt of a conditional occupancy permit for a data center facility.

	(1)	43,750 shares on each of December 6, 2024, 2025 2026 and 2027 for a total of 175,000 shares, upon vesting the options have life of seven years.
	(2)	the remaining 175,000 shares based on the Company completing the following milestones (upon vesting the options have a life of seven year):

The Company’s management has accounted for the options in accordance with ASC 718, which requires the Company to estimate the service period over which the compensation cost will be recognized. Management has estimated that the first development phase (a) will be completed by June 30, 2026, the second development phase (b) by December 31, 2025, the third development phase (c) by March 31, 2026, and the fourth and fifth development phases (d) and (e) by June 30, 2029. The estimated service period will be adjusted for actual and expected completion date changes. Any such change will be recognized prospectively, and the remaining deferred compensation will be recognized over the remaining service period.

a.The option ~~35,000~~grant ~~upon~~date ~~completion~~fair value of ~~the~~$2,437,000 was ~~initial~~calculated ~~site~~using ~~development~~the ~~plan~~Black ~~and~~Scholes ~~Data~~fair ~~Center~~value ~~design~~option-pricing ~~and~~model ~~100%~~with ~~Construction~~key ~~Documents.~~input b.variables ~~17,500~~provided ~~upon~~by ~~the~~management, ~~Award~~as of athe date ~~GMP~~of ~~contract~~issuance: tovolatility arange ~~construction manager/company c~~166.28% to 17243.04%,~~500 shares upon~~ the ~~Company~~fair ~~receiving~~value ~~permits necessary to start construction~~ of ~~the~~common ~~data~~stock ~~center~~$2.62, estimated ~~site~~life ~~and~~range ~~facilities (including but not limited~~ 2.38 to ~~power substation~~5.0 years, ~~water~~risk-free ~~delivery,~~rate ~~pumping,~~of ~~storage~~range ~~and~~4.34% to ~~onsite distribution systems, fiber conduit lines~~ 4.72% and ~~communications~~dividend ~~systems,~~rate ~~and~~of ~~on-site~~nil. For ~~roads,~~the ~~water,~~years ~~power~~ended ~~and~~December ~~communications grid~~31, ~~buildings,~~2024 ~~perimeter walls~~ and ~~security systems). d. 35~~2023,~~000~~ ~~upon~~ the ~~completion~~Company ofrecorded ~~all~~compensation ~~Network~~expenses ~~Ready~~of ~~meet~~approximately ~~me rooms in the first data center e. 70~~$1,317,000 and ~~shares~~nil, ~~upon~~respectively, ~~the~~which ~~completion~~was ofcapitalized ~~construction~~as ~~of a customer-ready~~ data center ~~facility and receipt of an conditional occupancy permit for a Data Center facility~~cost.

The Company’s management has accounted for the data center development consultant options in accordance with ASC 718 – Stock Compensation (“ASC 718”). ASC 718 requires the Company to estimate the service period over which the compensation cost will be recognized. Management has estimated that the first development phase (a) will be completed by October 1, 2024, the second development phase (b) by December 31, 2024, the third development phase (c) by April 1, 2025, and the fourth and fifth development phases (d) and (e) by September 1, 2026. The estimated service period will be adjusted for actual and expected completion date changes. Any such change will be recognized prospectively, and the remaining deferred compensation will be recognized over the remaining service period.F-17

The data center development consultant options grant date fair value of $189,000 was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance: volatility 322.83%, the fair value of common stock $0.50, estimated life of 5.5 years, risk-free rate of 4.12% and dividend rate of $0. For the year ended December ~~31,~~ 2023, ~~the~~Stock ~~Company recorded compensation expenses of approximately $7,000, which was capitalized as data center cost.~~Options

~~The~~In December ~~350~~2023,~~000~~ the Board of Directors approved the issuance of stock options to the directors for ~~executive~~the ~~advisor~~purchase of 500,000, 750,000 and as404,000 ~~follows:~~of the Company’s common stock, for a total of 1,654,000 shares, to the three directors (“Directors Options”) for an exercise price of $0.54, which was the fair market value of the Company’s common stock on the date of issuance. The Director Options vested on December 31, 2023 and expire on December 29, 2030.

a.The Director ~~70,000~~Options ~~upon~~grant ~~completion~~date fair value of ~~the~~approximately ~~initial~~$860,000 ~~site~~was ~~development~~calculated ~~plan~~using ~~and~~the ~~data~~Black ~~center~~Scholes ~~design~~fair ~~and~~value ~~100%~~option-pricing ~~construction~~model with ~~documents.~~key b.input ~~35,000~~variables ~~upon~~provided ~~the~~by ~~award~~management as of athe ~~GMP~~date ~~contract~~of toissuance: avolatility ~~construction~~of ~~manager/company~~224. ~~c. 35~~03%,~~000~~ ~~options upon~~ the ~~Company~~fair ~~receiving~~value ~~the~~of ~~permits~~common ~~necessary~~stock to$0.54, estimated ~~start~~life ~~construction~~ of ~~the~~3.5 ~~data~~years, ~~center~~risk-free ~~site~~rate ~~and~~of ~~facilities~~4.12% d.and ~~70,000~~dividend ~~options~~rate ~~upon the completion~~ of a$0. ~~network-ready~~The ~~meeting~~Director ~~room~~Options ingrant ~~the~~date ~~first~~fair ~~data~~value ~~center.~~of ~~e. 140~~$860,000 was ~~options~~included ~~upon~~in the ~~completion of construction of a customer~~equity-~~ready~~based ~~data~~compensation ~~center~~in ~~facility~~the ~~and~~Statement ~~receipt~~ of aOperations ~~conditional~~for ~~occupancy~~the ~~permit~~year ~~for~~ended aDecember ~~data~~31, ~~center facility~~2023.

~~The~~In ~~Company’s~~December ~~management~~2023, ~~has accounted for~~ the ~~executive~~Board ~~advisors~~of ~~options~~Directors inapproved ~~accordance~~the ~~with~~issuance ~~ASC~~of ~~718~~stock –options ~~Stock~~to ~~Compensation (“ASC 718”). ASC 718 requires~~ the Company’s toCEO ~~estimate~~and ~~the~~COO ~~service~~for ~~period over which~~ the ~~compensation~~purchase ~~cost~~of ~~will be recognized. Management has estimated that the first development phase (a) will be completed by October~~ 1, ~~2024~~000, ~~the second development phase (b) by December~~000 ~~31,~~and ~~2024, the third development phase (c) by April~~ 1, ~~2025~~000,000, ~~and~~respectively ~~the~~(“2023 ~~fourth~~Executive ~~and fifth development phases (d~~Options”) ~~and~~for ~~(e)~~an byexercise ~~September~~price 1,of ~~2026~~$0. ~~The~~54, ~~estimated~~which ~~service~~was ~~period~~the ~~will~~fair bemarket ~~adjusted~~value ~~for~~of the ~~actual~~Company’s ~~and~~common ~~expected~~stock ~~completion~~on the date ~~changes~~of issuance. ~~Any~~The ~~such~~2023 ~~change~~Executive ~~will~~Options ~~be recognized prospectively~~vest, ~~and~~ ~~the~~as ~~remaining deferred compensation will be recognized over the remaining service period.~~follows:

The ~~data~~both ~~center~~the ~~development~~CEO ~~consultant~~and ~~options~~COO ~~grant date fair value of $182~~1,000 ~~was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management~~,000 asoptions ofvest ~~the date of issuance: volatility of 224.03%, the fair value of common stock $0.50, estimated life of 3.5 years, risk-free rate of 4.127%~~ and ~~dividend~~become ~~rate~~exercisable ~~of $0. For the year ended December 31, 2023, the Company recorded compensation expenses of approximately $8,000, which was capitalized~~ as ~~data center cost.~~follows:

SCHEDULE OF STOCK OPTION ACTIVITIES

	(1)	166,667 shares on each of December 6, 2024, 2025 and 2026 for a total of 500,000 shares, upon vesting the options have a life of seven years.

	(2)	the remaining 500,000 shares based on the Company completing the following milestones (upon vesting the options have a life of seven year):

	Number of Shares		Weighted Average Strike Price/Share		Weighted Average Remaining Contractual Term (Years)		Weighted Average Grant Date Fair Value/Share		Aggregate Intrinsic Value
Balance, January 1, 2021		-	$	-		-	$	-	$	–
Granted		-		-		-		-		-
Forfeited		–		–		–		–		–
Exercised		–		–		–		–		–
Expired		–		–		–		–		–
Balance, December 31, 2022		-		-		-		-		-
Granted		6,854,000		0.53		7.00		0.51		2,980,000
Forfeited		–		–		–		–		–
Exercised		–		–		–		–		–
Expired		-		-		-		-		-
Balance, December 31, 2023		6,854,000		0.53		7.00		0.51		2,980,000
Vested and exercisable, December 31, 2023		1,654,000		0.54		7.00		0.52		695,000
Unvested, December 31, 2023		5,200,000	$	0.52		7.00	$	0.50	$	2,285,000

	a.	100,000 shares upon completion of the initial site development plan and Data Center design, and submission of a complete set of plans to Imperial County Planning and Development Department for approvals and permits.
	b.	100,000 shares upon the Company receiving permits necessary to start construction of the data center site and facilities (including but not limited to power substation, water delivery, pumping, storage and on- site distribution systems, fiber conduit lines and communications systems, and on-site roads, water, power and communications grid, warehousing, offices, administration, support and security buildings, perimeter walls and security systems).
	c.	100,000 shares) upon the completion of construction of a complete data center facility and receipt of an occupancy permit for such facility, either for a Data Center facility to be built as a “build to suit” building for a hyperscale company or as a wholesale colocation building for enterprise IT customers.
	d.	200,000 shares) upon the signing of a build-to-suit contract or one or more contracts being signed for 50% or more of a constructed and operational wholesale colocation facility’s capacity.

~~F-16~~The Company’s management has accounted for the 2023 Executive Options in accordance with ASC 718 – Stock Compensation (“ASC 718”). ASC 718 requires the Company to estimate the service period over which the compensation cost will be recognized. Management has estimated that the first development phase (a) will be completed by December 31, 2025, the second development phase (b) by June 30, 2029, the third development phase (c) by April 1, 2025 and the fourth development phase (d) by June 30, 2027. The estimated service period will be adjusted for actual and expected completion date changes. Any such change will be recognized prospectively, and the remaining deferred compensation will be recognized over the remaining service period.

~~Warrants~~The 2023 Executive Options grant date fair value of $1,060,000 was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance: volatility range of 232.67% to 235.04%, the fair value of common stock $0.50, estimated life range of 4.5 years to 4.77 years, risk-free rate of 4.12% and dividend rate of $0. For the years ended December 31, 2024 and 2023, the Company recorded compensation expenses of approximately $645,000 and $59,000, respectively, of which approximately $253,000 and $21,000 was expensed as compensation expense and approximately $392,000 and $38,000 was capitalized as data center cost.

In November 2023, the Company issued two warrants to purchase 2,000,000 and 3,545,801 (“2023 Warrants”) to two of the Company’s directors. The 2023 Warrants have an exercise price of $0.54, which was the fair value of the Company’s common stock on the date of issuance. The 2023 Warrants vested on December 31, 2023 and expire on December 31,2028. The 2023 Warrants grant date fair value of approximately $2,056,000 was calculated using the Black Scholes fair value optionF-pricing model with key input variables provided by management, as of the date of issuance: volatility of 123.0%, the fair value of common stock $0.54, estimated life of 2.5 years, risk-free rate of 4.33% and dividend rate of $0. The 2023 Warrants’ grant date fair value of $2,056,000 was included in the equity-based compensation in the Statement of Operations for the year ended December 31, 2023.18

~~During~~In December 2023, the ~~year~~Board ~~ended~~of ~~December~~Directors ~~31,~~approved ~~2023~~the issuance of stock options to two consultants, ~~100~~an executive advisor and data center development advisor,~~804~~ ~~warrants~~for ~~expired~~the purchase of 350,000 and 1350,~~567~~000,~~500~~ ~~warrants~~for ~~were~~each ~~forfeited~~consultant ~~with~~(collectively ~~conversion~~“2023 Consultant Options”) for an exercise price of $0.54, which was the ~~associated~~fair ~~Convertible Promissory~~market ~~Notes~~value ~~(see~~of ~~Note~~the 5)Company’s common stock on the date of issuance.

~~SCHEDULE~~The OF350,000 ~~WARRANTS~~options ~~ACTIVITY~~for data center development consultant vest, as follows:

		Number of Shares			Weighted Average Strike Price/Share		Weighted Average Remaining Contractual Term (Years)		Weighted Average Grant Date Fair Value/Share		Aggregate Intrinsic Value
	(1)	43,750 shares on each of December 6, 2024, 2025 2026 and 2027 for a total of 175,000 shares, upon vesting the options have life of seven years.
Balance, January 1, 2022			2,021,304		$	1.84		2.28	$	1.80	$	-
	(2)	the remaining 175,000 shares based on the Company completing the following milestones (upon vesting the options have a life of seven year):
Granted			-			-		-		-		-
Forfeited			–			–		–		–		–
Exercised			–			–		–		–		–
Expired			(253,000	)		1.50		-		1.37		–
Balance, December 31, 2022			1,768,304			1.84		1.58		1.86		-
Granted			5,545,801			0.54		0.66		–		–
Forfeited			(1,567,500	)		1.86		–		–		–
Exercised			-			–		–		–		–
Expired			(100,804	)		1.50		2.98		1.14		0.17
Balance, December 31, 2023			5,645,801			1.84		3.00		1.49		1,118,000
Vested and exercisable, December 31, 2022			5,645,801			1.84		3.00		1.49		1,118,000
Unvested, December 31, 2023			–		$	–		–	$	–	$	–

~~Note 8~~a. –35,000 ~~Income~~upon ~~Taxes~~completion of the initial site development plan and Data Center design and 100% Construction Documents. b. 17,500 upon the Award of a GMP contract to a construction manager/company c. 17,500 shares upon the Company receiving permits necessary to start construction of the data center site and facilities (including but not limited to power substation, water delivery, pumping, storage and onsite distribution systems, fiber conduit lines and communications systems, and on-site roads, water, power and communications grid, buildings, perimeter walls and security systems). d. 35,000 upon the completion of all Network Ready meet me rooms in the first data center e. 70,000 shares upon the completion of construction of a customer-ready data center facility and receipt of a conditional occupancy permit for a Data Center facility.

~~INCOME~~The Company’s ~~TAXES~~management has accounted for the data center development consultant options in accordance with ASC 718 – Stock Compensation (“ASC 718”). ASC 718 requires the Company to estimate the service period over which the compensation cost will be recognized. Management has estimated that the first development phase (a) will be completed by June 30, 2026, the second development phase (b) by December 31, 2025, the third development phase (c) by March 31, 2026, and the fourth and fifth development phases (d) and (e) by June 30, 2029. The estimated service period will be adjusted for actual and expected completion date changes. Any such change will be recognized prospectively, and the remaining deferred compensation will be recognized over the remaining service period.

~~For~~The ~~the~~data ~~period~~center ~~ended~~development ~~December~~consultant ~~31,~~options ~~2023,~~grant ~~the~~date ~~Company~~fair ~~generated~~value aof ~~current~~$189,000 was ~~income~~calculated ~~tax~~using ~~provision~~the ofBlack ~~Nil.~~Scholes ~~Additionally,~~fair ~~no deferred~~value ~~income~~option-pricing ~~taxes~~model ~~have~~with ~~been~~key ~~recorded~~input ~~due~~variables toprovided ~~the~~by ~~uncertainty~~management, as of the date ~~realization~~ of ~~any~~issuance: ~~tax~~volatility ~~assets~~322. ~~On December 31~~83%, ~~2023, the~~ ~~Company~~the ~~has~~fair ~~net~~value ~~operating~~of ~~loss~~common ~~(“NOL”)~~stock ~~carryforwards~~$0.50, estimated ~~for~~life ~~Federal~~of ~~income~~5.5 years, ~~tax~~risk-free ~~purpose~~rate of ~~$6,295,000~~4.12% and ~~for~~dividend ~~state~~rate ~~income tax purpose~~ of $~~6,288,000~~0. ~~that~~For ~~may~~the beyears ~~offset~~ended ~~against~~December ~~future~~31, ~~taxable~~2024 ~~income.~~and ~~For~~2023, ~~federal~~the ~~purposes,~~Company ~~there~~recorded iscompensation anexpenses ~~unlimited~~of ~~carryforward~~approximately ~~period~~$104,000 and ~~for state purposes~~$7,000, which ~~the~~was ~~net~~capitalized ~~operating~~as ~~losses~~data ~~begin~~center ~~to expire in 2037 if not utilized by then~~cost.

The 350,000 ~~income~~options ~~tax~~for ~~(benefit)/expense~~the ~~attributable~~executive toadvisor ~~loss~~will ~~consisted~~vest ofbased on the following, ~~for~~performance ~~the year ended December 31~~milestones:

~~SCHEDULE OF~~a. ~~INCOME~~70,000 ~~TAX~~upon ~~(BENEFIT)~~completion ~~EXPENSE~~of the initial site development plan and data center design and 100% construction documents. b. 35,000 upon the award of a GMP contract to a construction manager/company. c. 35,000 options upon the Company receiving the permits necessary to start construction of the data center site and facilities. d. 70,000 options upon the completion of a network-ready meeting room in the first data center. e. 140,000 options upon the completion of construction of a customer-ready data center facility and receipt of a conditional occupancy permit for a data center facility.

	2023		2022
Current provision for income taxes:
Federal	$	-	$	-
State		-		-
Total current income tax		-		-
Deferred tax expense:
Federal		-		-
State		-		-
Total deferred tax		-		-
Total income tax	$	-	$	-

F-19

AThe ~~reconciliation~~Company’s ofmanagement has accounted for the ~~federal~~executive ~~statutory~~advisors’ ~~income~~options ~~tax~~in ~~rate~~accordance towith ASC 718 – Stock Compensation (“ASC 718”). ASC 718 requires the Company’s ~~effective~~to ~~income~~estimate ~~tax~~the ~~rate~~service isperiod asover ~~follows:~~which the compensation cost will be recognized. Management has estimated that the first development phase (a) will be completed by June 30, 2026, the second development phase (b) by December 31, 2025, the third development phase (c) by March 31, 2026, and the fourth and fifth development phases (d) and (e) by June 30, 2029. The estimated service period will be adjusted for actual and expected completion date changes. Any such change will be recognized prospectively, and the remaining deferred compensation will be recognized over the remaining service period.

~~SCHEDULE~~The data OFcenter ~~RECONCILIATION~~development OFconsultant ~~INCOME~~options ~~TAX~~grant date fair value of $182,000 was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance: volatility of 224.03%, the fair value of common stock $0.50, estimated life of 3.5 years, risk-free rate of 4.127% and dividend rate of $0. For the years ended December 31, 2024 and 2023, the Company recorded compensation expenses of approximately $94,000 and $8,000, which was capitalized as data center cost.

	2023			2022
Taxes calculated at federal rate		21.0	%		21.0	%
Permanent differences		(13.8	)		-
State tax, net of federal impact		-			-
Return to provision		-			-
Other		2.3			14.4
Change in valuation allowance		(9.5	)		(35.4	)
Provision for income taxes		0	%		0	%

June 2023 – Stock Options

FAs part of the Employment Agreement, as defined in Note 6 – Commitments and Contingencies, the executive was granted an incentive stock option (“Incentive Option”) and a non-17qualified stock option (“Non-Qual Option”) (collectively “Stock Options”) to purchase 600,000 and 1,900,000, respectively, shares of the Company’s common stock for $0.50 per share. The Stock Options are exercisable for a period of seven years from the date of grant, which was June 19, 2023 (“Grant Date”).

The ~~tax~~Incentive ~~effects~~Option shall vest and become exercisable as follows: (i) options to purchase up to 200,000 shares ~~rounded~~of Common Stock shall vest and become exercisable on the first anniversary of the Grant Date; (ii) options to ~~thousands~~purchase up to 200,000 shares of ~~temporary~~Common ~~differences~~Stock ~~that~~shall ~~give~~vest ~~rise~~and become exercisable on the second anniversary of the Grant Date; and (iii) options to ~~significant~~purchase ~~portions~~up to 200,000 shares of Common Stock shall vest and become exercisable on the ~~deferred~~third ~~tax~~anniversary ~~assets~~of atthe ~~December~~Grant Date; provided that the Optionee is an employee in good standing with the Company on such applicable 31vesting date. The Incentive Option Grant Date fair value of $300,000 was ~~are~~calculated ~~presented~~using ~~below~~the Black Scholes fair value option-pricing model with key input variables provided by management, as of the date of issuance: volatility of 339%, the fair value of common stock $0.50, estimated life of 5 years, risk-free rate of 3.99% and dividend rate of $0.

~~SCHEDULE~~The Non-Qual OFOption ~~COMPONENTS~~shall OFvest ~~DEFERRED~~and ~~TAX~~become ~~ASSETS~~exercisable as follows:

		2023			2022
	(1)	216,666 shares on each of the first two anniversaries of the Grant Date and 216,668 shares on the third anniversary of the Grant Date, provided that the Optionee is an employee or Board member in good standing with the Company on such applicable vesting date.
Deferred tax assets
	(2)	the remaining 1,250,000 shares based on the Company completing the following milestones:
Net operating loss carryforwards		$	1,786,000		$	1,661,000
Stock based compensation			328,000			9,000
Intangible assets			1,000			1,000
Impairment loss			38,000			38,000
Total deferred tax assets			2,153,000			1,709,000
Deferred tax liability
Deferred tax liability			-			-
Total deferred tax liability			-			-
Net deferred tax assets			2,153,000			1,709,000
Valuation allowance			(2,153,000	)		(1,709,000	)
Net deferred tax		$	—		$	—

~~Deferred tax~~a. ~~assets~~250,000 ~~and~~shares ~~liabilities~~upon ~~are~~completion ~~computed~~of bythe ~~applying~~initial ~~the~~site ~~federal~~development plan and ~~state~~Data ~~income~~Center ~~tax~~design, ~~rates~~and insubmission ~~effect~~of a complete set of plans to Imperial County Planning and Development Department for approvals and permits. b. 250,000 shares upon the ~~gross~~Company ~~amounts~~receiving permits necessary to start construction of ~~temporary differences~~the data center site and ~~other~~facilities ~~tax~~(including ~~attributes~~but not limited to power substation, ~~such~~water asdelivery, ~~net~~pumping, ~~operating~~storage ~~loss~~and ~~carryforwards~~on-site distribution systems, fiber conduit lines and communications systems, and on-site roads, water, power and communications grid, warehousing, offices, administration, support and security buildings, perimeter walls and security systems). Inc. ~~assessing~~250,000 ifshares upon the ~~deferred~~completion ~~tax~~of ~~assets~~construction ~~will~~of bea ~~realized~~complete data center facility and receipt of an occupancy permit for such facility, ~~the~~ ~~Company~~either ~~considers~~for ~~whether~~a itData isCenter ~~more~~facility ~~likely~~to ~~than~~be ~~not~~built ~~that~~as ~~some~~a “build to suit” building for a hyperscale company or ~~all~~as ofa ~~these~~wholesale ~~deferred~~colocation ~~tax~~building ~~assets~~for ~~will~~enterprise beIT ~~realized~~customers. ~~The~~d. ~~ultimate realization~~500,000 ofshares ~~deferred~~upon ~~tax~~signing ~~assets~~a isbuild-to-suit ~~dependent~~contract ~~upon~~or ~~the~~one ~~generation~~or ofmore ~~future~~contracts ~~taxable~~being ~~income~~signed ~~during~~for ~~the~~50% ~~period~~or inmore ~~which~~of ~~these~~a ~~deductible temporary~~constructed ~~differences~~and ~~reverse~~operational wholesale colocation facility’s capacity.

For financial reporting purposes, the Company has incurred a loss in each period since its inception. Based on all available evidence, including the Company’s history of losses, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets on December 31, 2023, and 2022. During the years ended December 31, 2023, and 2022, the valuation allowance increased (decreased) by $444,000 and $(782,000), respectively. The increase was mostly attributable to the increase in our net operating loss carryforwards. The total valuation allowance results from the Company’s estimate of its inability to recover its net deferred tax assets.F-20

OnThe ~~December 31, 2023, the~~ Company’s management has ~~federal~~accounted ~~and state net operating loss carryforwards, which are available to offset future taxable income, of approximately $6,295,000 which~~ for ~~federal~~the ~~purposes~~Non-Qual ~~has~~Option anin ~~unlimited~~accordance ~~carryforward~~with ~~period~~ASC ~~and~~718 ~~$6,330,000~~– ~~which~~Stock ~~for~~Compensation ~~state~~(“ASC ~~purposes begins~~718”). toASC ~~expire~~718 inrequires ~~2037.~~the ~~These~~Company ~~carryforwards may be subject~~ to anestimate ~~annual limitation under Section 382 and 383 of~~ the ~~Internal~~service ~~Revenue~~period ~~Code of~~over ~~1986,~~which ~~and similar state provisions if~~ the ~~Company~~compensation ~~experienced~~cost ~~one~~will orbe ~~more~~recognized. ~~ownership~~Management ~~changes~~has estimated that ~~would limit~~ the ~~amount~~first ofdevelopment ~~NOL~~phase ~~and tax~~(a) ~~credit~~will ~~carryforwards that can~~ be ~~utilized~~completed by toDecember ~~offset future taxable income and tax~~31, ~~respectively. In general~~2025, anthe ~~ownership~~second ~~change, as~~development ~~defined~~phase (b) by ~~Sections~~June ~~382~~30, ~~and 383~~2029, ~~results~~the ~~from~~third ~~transactions~~development ~~increasing~~phase ~~ownership~~(c) ofby ~~certain~~April ~~stockholders~~1, or2025 ~~public~~and ~~groups in~~ the ~~stock~~fourth ofdevelopment ~~the~~phase ~~corporation~~(d) by ~~more~~June ~~than~~30, ~~50 percentage points over a three-year period~~2027. The ~~Company~~estimated ~~has~~service ~~not~~period ~~completed an IRC Section 382/383 analysis.~~will Ifbe aadjusted ~~change~~for inactual ~~ownership were to have occurred, NOL~~ and ~~tax~~expected ~~credit~~completion ~~carryforwards~~date ~~could be eliminated or restricted~~changes. IfAny ~~eliminated,~~such ~~the related~~change ~~asset~~will ~~would~~ be ~~removed~~recognized ~~from~~prospectively, ~~the~~and ~~deferred tax asset schedule with a corresponding reduction in~~ the ~~valuation~~remaining ~~allowance. Due to~~deferred ~~the~~compensation ~~existence of the valuation allowance, limitations created by future ownership changes, if any,~~ will ~~not~~be ~~impact~~recognized over the ~~Company’s effective~~remaining ~~tax~~service ~~rate~~period.

The ~~Company~~Non-Qual ~~files~~Option ~~income~~Grant ~~tax~~Date ~~returns~~fair invalue ~~the~~of ~~United~~$875,000 was ~~States~~calculated ~~and~~using the ~~state~~Black ofScholes ~~California.~~fair ~~The~~value ~~statute~~option-pricing model ofwith ~~limitation~~key isinput 3variables ~~and~~provided 4by ~~years for Federal and California~~management, ~~respectively.~~as ~~The~~of ~~first~~the ~~year~~date ~~that~~of ~~remains~~issuance: ~~open~~volatility isrange ~~tax~~of ~~year~~137% to ~~ended December 31~~338%, ~~2020 and December 31, 2019 for Federal~~ ~~and~~the ~~California,~~fair ~~respectively.~~value As of ~~December~~common ~~31,~~stock ~~2023 and 2022~~$0.50, estimated ~~there~~life ~~are~~range noof ~~unrecognized~~3.9 years ~~tax~~to ~~benefits~~5.0 years, ~~and~~risk-free ~~there~~rate ~~are~~range noof ~~significant~~3.99% ~~accruals for interest related~~ to ~~unrecognized~~5.24% and ~~tax~~dividend ~~benefits~~rate orof ~~tax penalties~~$0.

~~The Company~~For ~~is in~~ the ~~process~~years ofended ~~analyzing~~December ~~its~~31, ~~NOL~~2024 and ~~has~~2023, ~~not determined if~~ the ~~company~~Company ~~has~~recorded ~~had~~compensation expenses ~~any change~~ of ~~control~~approximately ~~issues~~$465,000 ~~that~~and ~~could limit~~$98,000, ~~the~~respectively, ~~future use~~ of ~~NOL.~~which ~~The~~approximately ~~NOL~~$116,000 ~~carryforwards~~and ~~that~~$25,000 ~~were~~was ~~generated~~expensed ~~after~~as ~~2017~~compensation expense ofand approximately $6349,~~338,~~000 ~~may~~and ~~only~~$73,000 bewas ~~used~~capitalized toas ~~offset 80%~~data ofcenter ~~future taxable income and are carried forward indefinitely~~cost.

~~Note~~SCHEDULE 9OF –STOCK ~~Subsequent~~OPTION ~~Events~~ACTIVITIES

SUBSEQUENT EVENTS

	Number of Shares		Weighted Average Strike Price/Share		Weighted Average Remaining Contractual Term (Years)		Weighted Average Grant Date Fair Value/Share		Intrinsic Value
Balance, January 1, 2023		-	$	-			$	-	$	-
Granted		6,854,000		0.53		7.0		0.51		0.44
Forfeited		-		-		–		–		–
Exercised		–		–		–		–		–
Expired		-		-		-		-		-
Balance, December 31, 2023		6,854,000		0.53		7.0		0.51		0.44
Granted		1,350,000		3.24		8.8		3.15		0.09
Forfeited		-		-		–		–		–
Exercised		-		–		–		–		–
Expired		-		-		-		-		-
Balance, December 31, 2024		8,204,000		0.97		7.8		0.94		0.73
Vested and exercisable, December 31, 2024		2,616,500		0.67		5.7		0.65		0.81
Unvested, December 31, 2024		5,587,500	$	1.11		8.2	$	1.08	$	0.69

~~The~~For ~~Company evaluated all events that occurred after~~ the ~~balance~~year ~~sheet~~ended ~~date~~December ~~through~~31, ~~the~~2024, ~~date~~ the ~~financial~~total ~~statements~~equity-based ~~were~~compensation ~~issued~~was toapproximately ~~determine~~$2,749,000 ifof ~~they~~which ~~must~~approximately be$2,380,000 was ~~reported.~~capitalized ~~The~~as ~~management~~Data ~~determined~~Center ~~there are no reportable events except for the following~~Campus costs.

In January and February 2024, the remaining convertible promissory notes principal balance and accrued interest of $341,000 and $115,000, respectively were converted into 884,942 shares of the Company’s common stock.F-21

InFor the ~~February~~years ~~2024,~~ended ~~the~~December ~~Company~~31, ~~issued 100~~2023,~~000~~ ~~shares of~~ the ~~Company’s common~~total ~~stock~~equity-based tocompensation an(for ~~individual~~stock ~~who~~options ~~held~~and awarrants) ~~promissory~~was ~~note~~approximately ~~issued~~$3,368,000 of onwhich ~~August~~approximately 31$336,000 was ~~2018~~capitalized byas M1Data ~~Advisors~~Center ~~LLC.~~Campus costs

In February 2024, issued a promissory note in the principal amount of $1,000,000 that bears interest at the rate of 10% per annum and matures on May 30, 2024 and a five-year warrant to purchase up to 200,000 shares of common stock with an initial exercise price of $0.50 per share.Warrants

In November ~~February 2024~~2023, the Company ~~hired~~issued atwo ~~consulting~~warrants ~~firm~~to purchase 2,000,000 and 3,545,801 (“2023 Warrants”) to ~~develop~~two of the Company’s directors. The 2023 Warrants have an ~~environmental~~exercise ~~health~~price of $0.54, which was the fair value of the Company’s common stock on the date of issuance. The 2023 Warrants vested on December 31, 2023 and ~~safety~~expire ~~program~~on ~~compliant~~December 31, 2028. The 2023 Warrants grant date fair value of approximately $2,056,000 was calculated using the Black Scholes fair value option-pricing model with ~~ISO~~key ~~45001~~input ~~requirements~~variables ~~for~~provided anby management, as of the date of issuance: volatility of 123.0%, the fair value of common stock $0.54, estimated ~~fee~~life of 2.5 years, risk-free rate of 4.33% and dividend rate of $~~200~~0. The 2023 Warrants’ grant date fair value of $2,056,000 was included in the equity-based compensation in the Statement of Operations for the year ended December 31, 2023.

~~On March 1, 2024,~~ During the ~~Company~~year ~~hired~~ended anDecember ~~individual as vice president of data center development with an annual salary of $225~~31,~~000.~~ ~~The salary increases to $240~~2024,~~000~~ ~~and $250~~3,~~000 on the~~058,887 ~~1st~~warrants ~~and~~were ~~2nd anniversary dates~~issued, ~~respectively. Also~~600, ~~the individual is eligible for an annual bonus of up to 25%, 35%, and 40% of the annual~~000 ~~salary~~warrants ~~for~~forfeited ~~the~~(see ~~1st,~~Note ~~2nd,~~3) and ~~3rd calendar years~~100,000 ~~respectively~~expired.

~~F-18~~During the year ended December 31, 2023, 100,804 warrants expired, and 1,567,500 warrants were forfeited with conversion of the associated Convertible Promissory Notes (see Note 4).

SCHEDULE OF WARRANTS ACTIVITY

	Number of Shares			Weighted Average Strike Price/Share		Weighted Average Remaining Contractual Term (Years)		Weighted Average Grant Date Fair Value/Share		Intrinsic Value
Balance, January 1, 2023		1,768,304		$	1.84		1.6	$	1.86	$	-
Granted		5,545,801			0.54		0.7		-		-
Forfeited		(1,567,500	)		1.86		–		–		–
Exercised		–			–		–		–		–
Expired		(100,804	)		1.50		2.9		1.17		0.17
Balance, December 31, 2023		5,645,801			1.84		3.0		1.49		0.20
Granted		3,058,877			2.23		4.8		2.08		–
Forfeited		(600,000	)		3.65		4.5		3.00		–
Exercised		-			–		–		–		–
Expired		(100,000	)		1.87		-		1.95		-
Balance, December 31, 2024		8,004,678			0.95		4.3		0.83		0.62
Vested and exercisable, December 31, 2024		8,004,678			0.95		4.3		0.83		0.62
Unvested, December 31, 2024		–		$	–		–	$	–	$	–

NOTE 7 – INCOME TAXES

INCOME TAXES

For the period ended December 31, 2024, the Company generated a current income tax provision of $800. Additionally, no deferred income taxes have been recorded due to the uncertainty of the realization of any tax assets. On December 31, 2024, the Company has net operating loss (“NOL”) carryforwards for Federal income tax purpose of $7,421,000 and for state income tax purpose of $7,411,000 that may be offset against future taxable income. For federal purposes, there is an unlimited carryforward period, and for state purposes, the net operating losses begin to expire in 2037 if not utilized by then.

The income tax (benefit)/expense attributable to loss consisted of the following, for the year ended December 31,

	2024		2023
Current provision for income taxes:
Federal	$	-	$	-
State		-		-
Total current income tax		-		-

Deferred tax expense:
Federal		-		-
State		-		-
Total deferred tax		-		-
Total income tax	$	-	$	-

A reconciliation of the federal statutory income tax rate to the Company’s effective income tax rate is as follows:

	2024			2023
Taxes calculated at federal rate		21.0	%		21.0	%
Permanent differences		(18.0	)		(13.8	)
State tax, net of federal impact		-			-
Return to provision		-			-
Other		1.0			2.3
Change in valuation allowance		(4.0	)		(9.5	)
Provision for income taxes		0	%		0	%

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets at December 31, are presented below:

	2024			2023
Deferred tax assets
Net operating loss carryforwards	$	2,089,000		$	1,786,000
Stock based compensation		439,000			328,000
Intangible assets		1,000			1,000
Impairment loss		37,000			38,000

Total deferred tax assets		2,566,000			2,153,000

Deferred tax liability
		-			-
Total deferred tax liability		-			-

Net deferred tax assets		2,566,000			2,153,000
Valuation allowance		(2,566,000	)		(2,153,000	)
Net deferred tax	$	—		$	—

Deferred tax assets and liabilities are computed by applying the federal and state income tax rates in effect to the gross amounts of temporary differences and other tax attributes, such as net operating loss carryforwards. In assessing if the deferred tax assets will be realized, the Company considers whether it is more likely than not that some or all of these deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period in which these deductible temporary differences reverse.

F-22

For financial reporting purposes, the Company has incurred a loss in each period since its inception. Based on all available evidence, including the Company’s history of losses, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets on December 31, 2024, and 2023. During the years ended December 31, 2024, and 2023, the valuation allowance increased (decreased) by $413,000 and $444,000, respectively. The increase was mostly attributable to the increase in our net operating loss carryforwards. The total valuation allowance results from the Company’s estimate of its inability to recover its net deferred tax assets.

On December 31, 2024, the Company has federal and state net operating loss carryforwards, which are available to offset future taxable income, of approximately $7,421,000 which for federal purposes has an unlimited carryforward period and $7,411,000 which for state purposes begins to expire in 2037. These carryforwards may be subject to an annual limitation under Section 382 and 383 of the Internal Revenue Code of 1986, and similar state provisions if the Company experienced one or more ownership changes that would limit the amount of NOL and tax credit carryforwards that can be utilized to offset future taxable income and tax, respectively. In general, an ownership change, as defined by Sections 382 and 383, results from transactions increasing ownership of certain stockholders or public groups in the stock of the corporation by more than 50 percentage points over a three-year period. The Company has not completed an IRC Section 382/383 analysis. If a change in ownership were to have occurred, NOL and tax credit carryforwards could be eliminated or restricted. If eliminated, the related asset would be removed from the deferred tax asset schedule with a corresponding reduction in the valuation allowance. Due to the existence of the valuation allowance, limitations created by future ownership changes, if any, will not impact the Company’s effective tax rate.

The Company files income tax returns in the United States and the state of California. The statute of limitation is 3 and 4 years for Federal and California, respectively. The first year that remains open is tax year ended December 31, 2021 and December 31, 2020 for Federal and California, respectively. As of December 31, 2024 and 2023, there are no unrecognized tax benefits, and there are no significant accruals for interest related to unrecognized tax benefits or tax penalties.

The Company is in the process of analyzing its NOL and has not determined if the company has had any change of control issues that could limit the future use of NOL. The NOL carryforwards that were generated after 2017 of approximately $7,421,000 may only be used to offset 80% of future taxable income and are carried forward indefinitely.

Note 8 – Subsequent Events

SUBSEQUENT EVENTS

The Company evaluated all events that occurred after the balance sheet date through the date the financial statements were issued to determine if they must be reported. The management determined there are no reportable events except for the following:

On January 13, 2025 (“CSDO Termination Date”), the Company terminated the employment agreement with the Chief Strategy and Development Officer (“CSDO”) with an effective date of January 15, 2025. Based on the delays in the estimated milestone requirements for the development of the Company’s Data Center, it was determined that CSDO role was not required. As of the CSDO Termination Date, the CSDO non-qualified stock option agreement for 1,000,000 shares of the Company’s common stock was cancelled. Of the options shares of 1,000,000, the CSDO had vested 168,750 options shares, which are exercisable until the third anniversary date of the CSDO Termination Date.

On January 14, 2025 (“VPDCD Termination Date”), the Company terminated the employment agreement with the Vice President of Data Center Development (“VPCSD”) with an effective date of February 15, 2025. Based on the delays in the estimated milestone requirements for the development of the Company’s Data Center, it was determined that VPDCD role was not required. As of the VPDCD Termination Date, the VPDCD non-qualified stock option agreement for 350,000 shares of the Company’s common stock was cancelled. Of the options shares of 350,000, the CSDO had vested 43,750 options shares, which are exercisable until the third anniversary date of the CSDO Termination Date.

On January 15, 2025, the Company issued, to a consultant, a Non-Qualified Stock Option Agreement for the purchase of 350,000 shares of the Company’s common stock for an exercise price of $1.99, which was the fair value of the Company’s common stock on the grant date. The 350,000 options vest as follows:

	●	Become exercisable as to 43,750 Option Shares on January 16, 2026 and shall vest and become exercisable as to an additional 43,750 shares on each of January 16, 2027, January 16, 2028, and January 16, 2029 provided that the optionee is a consultant, an employee or a Board member in good standing with the Company on such applicable vesting date.
	●	The remaining 175,000 Option Shares based on the Employee or consultant completing the following milestones:

	○	will vest as to 20% of such Option Shares (35,000 shares) upon completion, with respect to the Company’s optioned real property in Imperial County, CA (the “Property”), of a general plan amendment, zone change, and approved use for data center and/or onsite power production use;
	○	will vest as to 20% of such Option Shares (35,000 shares) upon the completion of a development agreement with Imperial County, CA (the “County”) or similar land use and entitlement to memorialize the approval of a data center use for the Property;
	○	will vest as to 20% of such Option Shares (35,000 shares) upon the Company receiving from the County permits necessary to start construction at the Property of either an onsite power production of a 50MW generation system or a 60MW critical load data center facility (including but not limited to power substations, on-site roads, water, power, fiber communications, buildings, perimeter walls, and security systems);
	○	will vest as to 20% of such Option Shares (35,000 shares) upon the completion of binding agreements for an external or onsite portfolio of power sources for a minimum of 500MW of power to support the data center load at the Property; and
	○	will vest as to 20% of such Option Shares (35,000 shares) upon the completion of the sale or lease of all or a portion of the Property for “powered dirt”, a “powered shell” or a built-to-suit data center facility.

●

Vesting milestones can be altered or changed by the Company and the optionee mutually agreeing as the data center site development, building designs, and construction plans are further defined and timelines for permitting, construction, and customer contracts, occupancies, and operations’ milestones are established.

In January 2025, the Company issued a Debenture in the amount of $25,000, with a commission of $2,000 for net proceeds of $23,000.

In February 2025, the Company issued a Debenture in the amount of $100,000, with a commission of $4,000 for net proceeds of $96,000.

In March 2025, the Company issued a Debenture in the amount of $100,000, with a commission of $4,000 for net proceeds of $96,000.

F-23

Filing Compare · CalEthos, Inc.