UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

~~FORM~~ Form 10-Q

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

For the quarterly period ended August ~~February 28~~31, 2022

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

For the transition period from ___ to ___

Commission file number: 000-53994

LZG INTERNATIONAL, INC. (Exact name of registrant as specified in its charter)

(Exact name of registrant as specified in its charter)

Florida

90-1907109

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

FLORIDA (State or other jurisdiction of incorporation or organization)	98-0234906 (I.R.S. Employer Identification No.)
135 WEST 41st STREET, SUITE 5-104NEW YORK, NY		10036
54 WEST 40th STREET, SUITE 1123, NEW YORK, NEW YORK (Address of principal executive offices)	10018 (Zip code)
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (917-) 310-3978

2157 S. Lincoln Street, Suite 401, Salt Lake City, Utah 84106

(Former address)

Securities registered pursuant to Section 12(b) of the Act: None

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

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See ~~the~~definition ~~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 ☐ ~~Non-accelerated~~Accelerated filer ☑☐ ~~Accelerated~~Non-accelerated ~~filer~~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 is a shell company (as defined in Rule 12b-‑2 of the Exchange Act). Yes ☐ No ☑ ☒

The number of shares outstanding of the registrant’s common stock as of ~~April~~September 1428, 2022, was 10152,~~250~~687,~~556~~456.

TABLE OF CONTENTS

	PART I – FINANCIAL INFORMATION
		PAGE
PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements	3
	Condensed Balance Sheets (Unaudited)	43
	Condensed Statements of Operations (Unaudited)	54
	Condensed Statements of Stockholders’ Equity (Deficit) (Unaudited)	65
	Condensed Statements of Cash Flows (Unaudited)	76
	Notes to the Unaudited Condensed Financial Statements	87
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1117
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	1419
Item 4.	Controls and Procedures	1419
PART II – OTHER INFORMATION	~~PART II – OTHER INFORMATION~~
Item 1.	Legal Proceedings	1520
Item 1a.	Risk Factors	1520
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	1520
Item 3.	Defaults Upon Senior Securities	1520
Item 4.	Mine Safety Disclosures	1520
Item 5.	Other Information	1520
Item 6.	Exhibits	1521
~~Signatures~~	Signatures	1622

Table of Contents

PART I – FINANCIAL INFORMATION

~~ITEM~~Item 1. ~~FINANCIAL~~Financial ~~STATEMENTS~~Statements

LZG INTERNATIONAL, INC.

For the Three and Nine Months Ended

~~February~~ August 2831, 2022

(Unaudited)

3LZG International, Inc and Subsidiary

~~LZG~~Condensed ~~International,~~Consolidated ~~Inc.~~Balance Sheets

Condensed Balance Sheets


	As of
	August 31,			May 31,
	2022			2022
	UNAUDITED			AUDITED
ASSETS
CURRENT ASSETS
Cash	$	967,572		$	81,567
Accounts Receivable, Trade		1,255,853			24,471
Accounts Receivable, Trade, Related Party		173,788			130,341
Other Receivables, Related Party		177,358			9,794,813
Other Receivables		9,716
Inventory		4,135,937
Other Current Assets		2,437,499
Total Current Assets		9,157,723			10,031,192

FIXED ASSETS
Buildings and Other Fixed Assets		241,447			-
Accumulated Depreciation		(157,365	)		-
Net Fixed Assets		84,082			-

OTHER ASSETS
Intangible Assets		13,788,915			11,643,000
Accumulated Amortization		(1,956,003	)		(178,250	)
Other Long Term Assets		129,709			-
Goodwill		15,769,956
Total Other Assets		27,732,577			11,464,750

TOTAL ASSETS	$	36,974,382		$	21,495,942

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Accounts Payable	$	1,177,214		$	2,036
Note Payable - Related Party		3,000,000			3,000,000
Notes Payable		5,000,000			-
Accrued Expenses		152,558			50,000
Deferred Revenue		5,742,340			85,866
Accrued Interest - Related Party		71,836			11,836
Accrued Interest		114,667			-
Other Current Liabilities		2,443,272			-
Deferred Tax Liability		183,866			-
Total Current Liabilities		17,885,753			3,149,738

LONG-TERM LIABILITIES:
Notes Payable - Long Term		6,000,000			-

TOTAL LIABILITIES		23,885,753			3,149,738

STOCKHOLDERS' EQUITY
Preferred stock, $.001 par value, 20,000,000 shares
authorized, none issued and outstanding	$	-		$	-

Common Stock, $.001 par value; 250,000,000 shares authorized 144,899,472 shares issued and outstanding at 08/31/22 and 05/31/22		144,899			144,899

Additional Paid in Capital		22,836,850			22,474,358
Accumulated Deficit		(7,986,214	)		(4,273,053	)
Accumulated Other Comprehensive Loss		(1,906,906	)

Total Stockholders' Equity		13,088,629			18,346,204

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	36,974,382		$	21,495,942

~~(Unaudited)~~The accompanying notes are an integral part of these unaudited condensed financial statements.

	February 28, 2022			May 31, 2021
ASSETS
CURRENT ASSETS
Cash	$	90,584		$	4,735
Software Licensing		331,584			—
Total Current Assets		422,168			4,735
TOTAL ASSETS	$	422,168		$	4,735
CURRENT LIABILITIES
Accounts Payable	$	6,390		$	100
Accounts Payable – related party		10,500			6,000
Note Payable – related party		142,700			119,200
Notes Payable		108,300			69,800
Accrued Interest – related party		54,524			24,745
Accrued Interest		34,989			30,048
Total Current Liabilities		357,403			249,893
LONG-TERM LIABILITIES
Notes Payable – related party		—			23,500
Accrued Interest – related party		—			21,217
Total Long-term Liabilities		—			44,717
TOTAL LIABILITIES	$	357,403		$	294,610
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred Stock, $.001 par value, 20,000,000 shares authorized, none issued and outstanding	$	—		$	—
Common Stock, $.001 par value, 100,000,000 shares authorized; 10,250,226 and 250,556 shares issued and outstanding, respectively		10,251			251
Additional Paid-in Capital		3,401,134			3,063,134
Accumulated Deficit		(3,346,620	)		(3,353,260	)
Total Stockholders' Equity (Deficit)		64,765			(289,875	)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	$	422,168		$	4,735

Table of Contents

~~The~~LZG ~~accompanying~~International, ~~notes~~Inc ~~are~~and ~~an integral part of these unaudited condensed financial statements.~~Subsidiary

4Condensed Consolidated Statements of Operations

~~LZG~~For ~~International,~~the ~~Inc.~~three months ended

~~Condensed Statements of Operations~~UNAUDITED

(Unaudited)

	8/31/2022			8/31/2021

REVENUES	$	2,432,812		$	-

COST OF REVENUES		(314,405	)		-

GROSS PROFIT		2,118,407			-

EXPENSES
Sales and Marketing		(2,017,078	)		-
General and Administrative		(2,075,115	)		(9,725	)
Stock Compensation Expense		(362,492	)
Research and Development Costs		(1,136,836	)		-
TOTAL EXPENSES		(5,591,521	)		(9,725	)

Net Operating Loss Before Other Expense		(3,473,114	)		(9,725	)

OTHER EXPENSE
Other Income		73,636			-
Interest Expense		(114,667	)		(1,397	)
Interest Expense - related party		(60,000	)		(2,854	)
Currency Exchange Loss		(139,016	)
Total Other Expense		(240,047	)		(4,251	)

LOSS BEFORE INCOME TAXES		(3,713,161	)		(13,976	)

INCOME TAXES		-			-

NET LOSS	$	(3,713,161	)	$	(13,976	)

Net Loss Per Share	$	(0.03	)	$	(0.00	)

Weighted average shares outstanding		144,899,472			14,189,499

	THREE MONTHS ENDED FEB 28 2022			THREE MONTHS ENDED FEB 28 2021			NINE MONTHS ENDED FEB 28 2022			NINE MONTHS ENDED FEB 28 2021
REVENUES	$	43,447		$	—		$	86,894		$	—
Cost of Sales
Software Amortization		8,208			—			16,416			—
GROSS PROFIT		35,239			—			70,478			—
OPERATING EXPENSES
General and Administrative		17,645			2,825			50,335			10,975
TOTAL OPERATING EXPENSES		17,645			2,825			50,335			10,975
Net Operating Income (Loss)		17,594			(2,825	)		20,143			(10,975	)
OTHER EXPENSE
Interest Expense		(1,973	)		(1,282	)		(4,941	)		(3,783	)
Interest Expense – related party		(2,854	)		(2,734	)		(8,562	)		(8,202	)
TOTAL OTHER EXPENSE		(4,827	)		(4,016	)		(13,503	)		(11,985	)
INCOME (LOSS) BEFORE INCOME TAXES		12,767			(6,841	)		6,640			(22,960	)
INCOME TAXES EXPENSE		—			—			—			—
NET INCOME (LOSS)	$	12,767		$	(6,841	)	$	6,640		$	(22,960	)
Net Income (Loss) Per Share – basic and diluted	$	0.00		$	(0.03	)	$	0.00		$	(0.09	)
Weighted Average Shares Outstanding – basic and diluted		10,250,556			250,556			4,939,201			250,556

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

~~The~~4 ~~accompanying~~Table ~~notes are an integral part~~ of ~~these unaudited condensed financial statements.~~Contents

5LZG International, Inc and Subsidiary

~~LZG~~Condensed ~~International,~~Consolidated ~~Inc.~~Statement of Changes in Stockholders' Equity (Deficit)

~~Condensed~~For ~~Statements~~the ofthree ~~Stockholders’~~months ~~Equity (Deficit)~~ended August 31, 2021 and August 31, 2022

~~For the nine months ended February 28, 2022 and 2021~~UNAUDITED

(Unaudited)

										Accumulated
					Additional					Other			Total
	Common Stock				Paid in		Accumulated			Comprehensive			Stockholders'
	Shares		Amount		Capital		Deficit			Loss			Equity (Deficit)

Balance - May 31, 2021		250,556	$	251	$	3,063,134	$	(3,353,260	)	$	-		$	(289,875	)

Net loss		-		-		-		(13,976	)		-			(13,976	)

Balance - August 31, 2021		250,556	$	251	$	3,063,134	$	(3,367,236	)	$	-		$	(303,851	)

Balance - May 31, 2022		144,899,472	$	144,899	$	22,474,358	$	(4,273,053	)	$	-		$	18,346,204

Net loss		-		-		-		(3,713,161	)		-		$	(3,713,161	)

Foreign currency translation adjustment		-		-		-		-			(1,906,906	)	$	(1,906,906	)

Restricted stock assigned for services (non-vested)					$	362,492		-			-		$	362,492

Balance - August 31, 2022		144,899,472	$	144,899	$	22,836,850	$	(7,986,214	)	$	(1,906,906	)	$	13,088,629

	Common Stock				Additional Paid in		Accumulated			Total Stockholders’ Equity
	Shares		Amount		Capital		Deficit			(Deficit)
Balance – May 31, 2020		250,556	$	251	$	3,063,134	$	(3,323,418	)	$	(260,033	)
Net loss for the quarter ended August 31, 2020		—		—		—		(9,278	)		(9,278	)
Balance – August 31, 2020		250,556	$	251	$	3,063,134	$	(3,332,696	)	$	(269,311	)
Net loss for the quarter ended November 30, 2020		—		—		—		(6,841	)		(6,841	)
Balance – November 30, 2020		250,556	$	251	$	3,063,134	$	(3,339,537	)	$	(276,152	)
Net loss for the quarter ended February 28, 2021		—		—		—		(6,841	)		(6,841	)
Balance – February 28, 2021		250,556	$	251	$	3,063,134	$	(3,346,378	)	$	(282,993	)
Balance – May 31, 2021		250,556	$	251	$	3,063,134	$	(3,353,260	)	$	(289,875	)
Net loss for the quarter ended August 31, 2021		—		—		—		(13,976	)		(13,976	)
Balance – August 31, 2021		250,556	$	251	$	3,063,134	$	(3,367,236	)	$	(303,851	)
Net income for the quarter ended November 30, 2021		—		—		—		7,849			7,849
Issuance of common shares for acquisition of software		10,000,000		10,000		338,000		—			348,000
Balance – November 30, 2021		10,250,556	$	10,251	$	3,401,134	$	(3,359,387	)	$	51,998
Net loss for the quarter ended February 28, 2022		—		—		—		12,767			12,767
Balance – February 28, 2022		10,250,556	$	10,251	$	3,401,134	$	(3,346,620	)	$	64,765

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

~~The~~5 ~~accompanying~~Table ~~notes are an integral part~~ of ~~these unaudited condensed financial statements.~~Contents

6 LZG International, Inc and Subsidiary

~~LZG~~Condensed ~~International,~~Consolidated ~~Inc.~~Statements of Cash Flows

~~Condensed~~For ~~Statements~~the ofthree ~~Cash~~months ~~Flows~~ended

~~(Unaudited)~~UNAUDITED

	NINE MONTHS ENDED FEB 28, 2022			NINE MONTHS ENDED FEB 28, 2021
	8/31/2022			8/31/2021
Cash Flows from Operating Activities
Net Income (Loss)	$	6,640		$	(22,960	)
Net Loss	$	(3,713,161	)	$	(13,976	)
Adjustment to reconcile net income (loss) to cash provided (used) by operating activities:
Adjustment to reconcile net (loss) to cash used in operating activities:
Software amortization		16,416			—
Amortization and depreciation		584,625
Changes in operating assets and liabilities:
Stock issued for services performed		362,492
Accounts payable – related party		4,500			4,500
Changes in assets and liabilities:
Accounts payable		6,290			—
Accounts Receivable, Trade		2,422,423
Accrued interest		4,941			3,784
Other Receivables		(1,693	)
Accrued interest – related party		8,562			8,202
Other Receivables, Related Party		9,574,008
Net Cash Provided (Used) by Operating Activities		47,349			(6,474	)
Inventory		(304,201	)
Cash Flows from Investing Activities		—			—
Other Current Assets		4,734,189
Other Long Term Assets		(90,238	)
Accounts Payable		(1,509,730	)		3,525
Other Current Liabilities		94,603
Deferred Tax		10,851
Change in Related Party Note		(2,036	)
Accrued Expenses		53,102			4,251
Deferred Revenue		(2,940,522	)
Accrued Interest		174,667
Net Cash provided by (used in) Operating Activities		9,449,379			(6,200	)
Cash Flows from Financing Activities:
Proceeds from notes payable		38,500			5,000
Net Proceeds from Loans		11,000,000			5,000
Net Cash Provided by Financing Activities		38,500			5,000
Net cash provided by Financing Activities		11,000,000			5,000
Increase (Decrease) in Cash		85,849			(1,474	)
Cash Flows from in Investing Activities:
Cash, Beginning of Period		4,735			1,834
IP Asset Investment		57,249			-
Cash, End of Period	$	90,584		$	360
Fixed Asset Acquisitions		9,671
Supplemental Cash Flow Information:
Acquistion of PrimeSource, net of cash acquired		(17,723,388	)
Cash Paid For:
Net Cash used in Investing Activities		(17,656,468	)		-
Interest	$	—		$	—
Unrealized Currency Loss		(1,906,906	)
Income Taxes	$	—		$	—
Increase in Cash		886,005			(1,200	)
Non-cash Investing and Financing Activities
Cash and Cash Equivalents, Beginning of Period		81,567			4,735
Issuance of common stock for acquisition of software	$	348,000		$	—
Cash and Cash Equivalents, End of Period	$	967,572		$	3,535

~~The~~Non-Cash ~~accompanying~~Investing ~~notes~~and ~~are~~Financing ~~an integral part of these unaudited condensed financial statements.~~Activities

On August 1, 2022, the Company assigned 7,713,000 of restricted common shares in exchange for in-kind consulting services. The shares were valued at $17,399,632 or $2.22/share. Expenses are recognized over the vesting period. For the three months ended 08/31/22, $362,492 was recognized as expense.

~~LZG~~The ~~International,~~accompanying ~~Inc~~notes are an integral part of these unaudited condensed financial statements.

~~Notes~~6 toTable ~~the~~of ~~Condensed Financial Statements~~Contents

~~February~~LZG ~~28,~~International ~~2022~~Inc and Subsidiary

~~(Unaudited)~~Notes to the Condensed Consolidated Financial Statements

~~NOTE~~August 131, ~~– BASIS OF FINANCIAL STATEMENT PRESENTATION AND ACCOUNTING POLICIES~~2022

The accompanying unaudited condensed financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted in accordance with such rules and regulations. The information furnished in the interim condensed financial statements includes normal recurring adjustments and reflects all adjustments, which, in the opinion of management, are necessary for a fair presentation of such financial statements. Although management believes the disclosures and information presented are adequate to make the information not misleading, it is suggested that these interim condensed financial statements be read in conjunction with the Company’s audited financial statements and notes thereto included in its May 31, 2021 Annual Report on Form 10-K. As a result of acquiring the Fat Brain technology, the Company is launching business operations. Operating results for the nine months ended February 28, 2022 are not necessarily indicative of the results to be expected for year ending May 31, 2022.(UNAUDITED)

~~Revenue~~NOTE ~~Recognition~~1 –- ~~The~~BASIS ~~Company's~~OF ~~sources of~~FINANCIAL ~~revenue~~STATEMENT ~~are~~PRESENTATION ~~from~~AND ~~the~~ACCOUNTING sale of intellectual property licenses and technology, including services to configure, test and deploy FatBrain solutions on client servers, and providing training and support to a client’s staff. Revenues are reported net of returns.POLICIES

In the opinion of management, the accompanying unaudited interim Condensed Consolidated Financial Statements of LZG International and its subsidiary reflect all adjustments, including normal recurring accruals, necessary for a fair presentation. All significant intercompany balances and transactions have been eliminated in consolidation. Certain information and footnote disclosure normally included in annual financial statements prepared in accordance with ~~Accounting~~accounting ~~Standards Codification~~principles ~~(“ASC”)~~generally ~~Topic~~accepted ~~606~~in the United States of America have been condensed or omitted pursuant to instructions, ~~Revenue~~ ~~from~~rules ~~Contracts~~and ~~with~~regulations ~~Customers~~ prescribed by the Securities and Exchange Commission (“~~ASC 606~~SEC”),. ~~the~~The Company ~~recognizes~~ ~~revenue~~believes ~~upon~~that the ~~transfer~~disclosures ofprovided ~~promised~~herein ~~technologies~~are oradequate ~~services~~ to ~~customers~~make inthe aninformation ~~amount~~presented ~~that~~not ~~reflects~~misleading when these unaudited Condensed Consolidated Financial Statements are read in conjunction with the ~~consideration~~audited ~~to which~~Financial Statements contained in the Company’s ~~expects~~Form to10-K befor ~~entitled~~the inyear ~~exchange~~ended May 31,2022. The results of operations for ~~promised~~the ~~technologies~~three ormonths’ ~~services~~ended August 31, 2022 are not necessarily indicative of the results to be expected for the full year. The ~~Company~~Consolidated ~~applies~~Financial ~~the~~Statements ~~following~~as ~~five-step revenue~~of ~~recognition~~May ~~model~~31, 2022 are derived from audited financial statements included in ~~accounting~~the Company’s Form 10-K for ~~its~~the ~~revenue~~year ~~arrangements:~~ended May 31, 2022.

~~The ASC 606 criteria the Company uses to recognize revenue comprise of the following:~~Organization

~~1. Contract~~LZG ~~with~~International, Inc. (“the ~~customer – The~~ Company”) ~~acquired~~is ~~the~~a ~~contractual~~Florida ~~rights~~company tothat ~~the~~was ~~Angelina~~incorporated ~~Agreement,~~on ~~dated~~ May 10 22, ~~2021~~2000. ~~This~~To ~~agreement comprises a subsisting~~date, ~~identifiable contract~~ ~~between Tempus Inc. (an unrelated entity) and~~ the Company~~, reflecting that~~ ~~the~~has ~~parties~~not ~~have~~paid ~~approved~~any ~~the~~dividends ~~agreement~~ and ~~are~~does ~~committed~~not toanticipate ~~fulfilling~~dividends ~~their~~to ~~obligations.~~be ~~Each~~paid ~~party's~~in ~~rights are identifiable and~~ the ~~payment~~foreseeable ~~terms are quarterly subscriptions fees and transactions revenues~~future.

~~2. Performance~~On ~~obligations –~~June ~~The~~17, 2022, the Company ~~builds~~entered ~~the~~into ~~software~~a ~~solution~~Master ~~called~~Stock ~~Angelina~~Purchase FXAgreement ~~which~~with ~~logs~~two ~~into~~individuals, aYevgeniy ~~customer's general~~Chsherbinin ~~ledger~~and Victor Nazarov through its wholly owned subsidiary, ~~such~~FB asPrime ~~QuickBooks~~Source Acquisition, LLC to acquire Prime Source, a Kazakhstani corporation and ~~automatically~~Prime ~~determines~~Source’s ~~the~~affiliates ~~amount~~consisting of ~~savings~~Prime aSource ~~customer~~Innovation, ~~would~~Prime ~~enjoy~~Source if– ~~using~~Analytical ~~the~~Systems, ~~Angelina~~Digitalism, ~~FX rate~~and ~~versus~~InFin-IT ~~what~~Solution ~~they~~(together ~~actually~~with ~~paid~~Prime Source, asthe ~~reflected~~“Prime inSource anCompanies”). FXThe ~~Fair~~agreed ~~Value~~upon ~~Report~~purchase price of $18,000,000 is payable on a payment schedule.

~~3. Transaction~~Fiscal ~~price – The economic considerations are clearly spelled out in the Angelina Agreement~~Year

~~comprising estimated~~The ~~annual~~Company’s ~~subscription~~fiscal ~~revenue,~~year ~~plus~~ends aon ~~share~~May ~~of the transaction revenue earned from the application~~31.

~~4. Allocation~~Revenue ~~of transaction price – The quarterly payment earned under the subscription obligation for using our service is $43,447.~~Recognition

~~5. Revenue~~Substantially ~~recognition~~all –the ~~The~~Company’s revenue is ~~recognized~~derived from contracts with customers for subscription services over a period of time. Contracts with customers are considered to be short-term when the ~~subscription~~time ~~obligation~~between signed agreements and satisfaction of ~~providing,~~the ~~hosting~~performance obligations is equal to or less than one year, and ~~operating~~ virtually all of the ~~software~~Company’s ~~has~~contracts ~~been~~are ~~performed~~short-term. The Company ~~recognized~~recognizes revenue when services are provided to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services. The Company typically satisfies its performance obligations in contracts with customers upon delivery of ~~$86,894~~the ~~during~~services. The Company does not have any contract assets since the ~~nine~~Company ~~months~~has ~~ended~~an ~~February~~unconditional 28right to consideration when the Company has satisfied its performance obligation and payment from customers is not contingent on a future event. Generally, ~~2022~~payment is due from customers immediately at the invoice date, and the contracts do not have significant financing components nor variable consideration. ~~Costs~~There ofare ~~revenue consist~~no ofreturns ~~amortization~~and there are no allowances. All of the ~~underlying~~Company’s ~~software~~contracts ~~utilized~~have a single performance obligation satisfied at a point in time and the ~~Angelina~~transaction ~~Agreement.~~price ~~During~~is stated in the ~~nine~~contract, ~~months~~usually ~~ended~~as ~~February~~a ~~28,~~price ~~2022,~~ per unit. All estimates are based on the Company’s ~~recognized~~historical ~~software~~experience, ~~amortization~~complete satisfaction of ~~$16~~the performance obligation,~~416~~ and the Company’s best judgment at the time the estimate is made.

~~Basic~~7 ~~and~~Table ~~Diluted Loss Per Share – Basic loss per share is computed by dividing net loss by the weighted-average number~~ of common shares outstanding during the period. Diluted loss per share is computed by dividing net loss by the weighted-average number of common shares and dilutive potential common shares outstanding during the period. There are no potentially dilutive securities outstanding, so basic and diluted loss per share is the same.Contents

~~Intangible~~LZG ~~Assets~~International –Inc ~~The Company relies on guidance under ASC 350, Intangibles – Goodwill~~ and Other, to account for intangible assets. Intangible assets are either amortized over their finite lives as determined by management or their contractual lives, or analyzed periodically for impairment if indefinite-lived. A periodic review is made of the assets for impairment.Subsidiary

~~Software~~Notes ~~Costs – The Company follows ASC 985-20, Costs of Computer Software~~ to ~~be Sold, Leased, or Marketed, whereby costs incurred during~~ the ~~period~~Condensed ofConsolidated ~~planning~~Financial and design, prior to the period determining technological feasibility, for all software developed to be sold to external users has been charged to operations in the period incurred as research and development costs. Additionally, costs incurred after determination of readiness for market have been expensed as research and development. Purchased software that has reached technological feasibility and that has no alternative use, other than existing licenses or contracts for which it is being utilized, is capitalized at cost and amortized ratably over the term of the underlying contract.Statements

8August 31, 2022

~~NOTE 2 – GOING CONCERN~~(UNAUDITED)

~~The~~Cost accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has incurred losses since inception, has limited cash flows from operations, and has only recently launched revenue-generating activities. Its activities have been limited for the past several years and it is dependent upon financing to continue operations. These factors raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. It is management’s plan to further develop and market our technology.Revenues

InCost ~~addition,~~of Revenues primarily include expenses incurred by the ~~COVID-19~~Company ~~pandemic~~to ~~could~~host ~~have~~and andeliver ~~impact on~~products ~~our~~through ~~ability~~the tomarketplace ~~obtain~~and ~~financing~~payroll expenses directly to ~~fund~~the ~~our~~production ~~operations~~of market ready products. ~~The~~Related ~~Company~~platform isand ~~unable~~payment toprocessing ~~predict~~fees are recorded in the ~~ultimate~~period ~~impact~~incurred. atPayroll ~~this~~costs ~~time~~are recognized in the period they were incurred.

~~NOTE~~Cash ~~3 – RELATED PARTY TRANSACTIONS~~Equivalents

The ~~financial statements include related party transactions, which as of February 28, 2022 and May 31, 2021, included loans from an officer of the~~ Company ~~totaling~~considers ~~$23,500.~~all ~~The~~highly ~~loans~~liquid ~~had~~investments anwith original ~~due~~maturities ~~date~~ of ~~June~~three ~~30,~~months ~~2014,~~or ~~but~~less ~~principal and interest maturities have been extended to June 30, 2022. The loans are not collateralized, and bear interest~~ at ~~8% per annum. Interest expense was $1,410 for~~ the ~~nine~~time ~~months ended February 28, 2022, resulting in accrued interest~~ of ~~$22,627 and~~purchase ~~$21,217~~to atbe ~~February~~cash ~~28, 2022 and May 31, 2021, respectively~~equivalents.

~~During~~Accounts the nine months ended February 28, 2022, a stockholder paid for administrative and professional services totaling $4,500, resulting in amounts payable to the stockholder of $10,500 and $6,000 as of February 28, 2022 and May 31, 2021, respectively. On May 31, 2018 the stockholder converted $92,500 of its accounts payable to a promissory note, which bears interest at 8% per annum and is due on demand. Due to subsequent additional advances, the promissory note totaled $119,200 at February 28, 2022 and May 31, 2021. Interest expense was $7,152 for the nine months ended February 28, 2022, resulting in accrued interest of $31,897 and $24,745 at February 28, 2022 and May 31, 2021, respectively.Receivable

~~NOTE~~Accounts 4receivables –are ~~NOTES~~recorded ~~PAYABLE~~at the amount due from customers and do not bear interest. Amounts collected on accounts receivable are included in net cash provided by operating activities on the Statement of Cash Flows. The Company does not have any off-balance-sheet credit exposure related to its customers. The Company evaluates the collectability of its accounts receivables based on collection risks and historical experience. Estimated losses are recorded to the allowance for doubtful accounts and as a general expense. There were no anticipated losses in 2022 and therefore, no allowance for doubtful accounts is deemed necessary.

During the nine months ended February 28, 2022 and 2021, the Company borrowed $38,500 and $5,000, respectively, from a third party, resulting in notes payable of $108,300 and $69,800 at February 28, 2022 and May 31, 2021, respectively. The notes are due on demand, are not collateralized, and bear interest at 8% per annum. Interest expense was $4,941 for the nine months ended February 28, 2022, resulting in accrued interest of $34,989 and $30,048 at February 28, 2022 and May 31, 2021, respectively.Inventory

~~NOTE~~Inventories 5consist –of ~~SUBSCRIPTION~~raw ~~AGREEMENTS~~materials, work-in-process, and finished goods. Raw materials and finished goods are valued at the lower of cost or net realizable value, using the first-in, first-out (“FIFO”) valuation method. Work-in-process and finished goods includes the cost of materials, freight and duty, direct labor and overhead. The Company writes down inventory for estimated obsolescence equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions. On August 31, 2022, there is no reserve for inventory obsolescence is deemed necessary.

~~Beginning~~Fair onValue October 26, 2021, the Company entered into private subscription agreements with investors under the Securities Act. The subscription agreement provided that the issuance of the common shares was conditioned upon the Company increasing the number of authorized shares of common stock to at least 250,000,000, pursuant to Florida law. Any proceeds received for a subscription would be delivered to the Company and would be held in escrow with the Company’s attorney, without interest, until closing, which is the later of the Company’s first trade or the increase in authorized shares becomes effective. Upon closing, the proceeds currently held in escrow will become the property of the Company. As of February 28, 2022, closing has not occurred, and the Company has agreed to sell an aggregate of 22,990,000 shares to nine investors totaling $10,450,000, held in escrow.Measurement

9The fair value hierarchy categorizes the inputs used to measure fair value into three levels, which are described as follows:

~~NOTE~~· 6Level –1: ~~INTANGIBLE~~Quoted ~~ASSET~~prices ~~ACQUISITION~~(unadjusted) in active markets for identical assets or liabilities · Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly · Level 3: Inputs for the asset or liability that are not based on observable market data

OnIt October 23, 2021, the Company executed an “IT Asset Contribution Agreement” with FatBrain, LLC, an unrelated entity, for certain intellectual properties, including patents pending, proprietary technology, licenses, software, development plans and contractual rights. The intellectual property is ~~comprised~~not ofpracticable anto AIestimate ~~Technology with many commercial applications,~~ the ~~first~~fair ~~being~~value ~~“Angelina FX”. As consideration, the Company issued 10,000,000 shares~~ of ~~common stock~~related toparty ~~FatBrain,~~loans ~~LLC’s~~because ~~material~~there ~~non-controlling~~is ~~member,~~no ~~Peter~~established ~~B. Ritz. The mutually-agreed upon asset fair~~ market ~~value~~for ofthese ~~$348,000 was~~loans ~~allocated~~and ~~100%~~it tois ~~the~~inappropriate ~~Angelina FX software due~~ to ~~the~~estimate ~~assignment~~future ofcash ~~contractual~~flows, ~~rights~~which toare ~~the~~largely ~~Company~~dependent ~~of a licensing agreement previously entered into~~ on ~~May 7, 2021 between FatBrain and a non-related party, Tempus, Inc. This transaction resulted in a change in control of~~ the Company, ~~whereby~~establishing ~~Mr.~~or ~~Ritz~~acquiring isoperations ~~the~~at ~~owner~~some offuture 97point.6% ofNo ~~the~~financial ~~Company’s~~instruments ~~issued~~are ~~and~~held ~~outstanding~~for ~~common~~trading ~~stock~~purposes.

~~The~~Goodwill ~~estimated~~and ~~term~~Intangible of the licensing agreement is 60 months from the agreement’s inception on May 7, 2021. During the period of October 23, 2021 (the date of the IT Asset Contribution Agreement) through February 28, 2022, the Company recorded $16,416 of software amortization expense as cost of sales. The remaining carrying value of the software of $331,584 at February 28, 2022 is being amortized ratably over the remainder of the license term as follows:Assets

Year ended May 31:
2022	$	31,188
2023		78,792
2024		78,792
2025		78,792
2026		64,020
Total	$	331,584

The Company relies on guidance under ASC 350, Intangibles – Goodwill and Other, to account for intangible assets. Estimated useful lives of amortizable intangible assets are determined by management based on an assessment of the period over which the asset is expected to contribute to future cash flows.

OnIn ~~February~~accordance ~~25,~~with ~~2022, LZG International entered into the Intellagents, LLC Asset Purchase Agreement~~U.S. ~~LZG~~GAAP ~~agreed to purchase Intellagents’ assets~~ for ~~three~~goodwill ~~million dollars ($3,000,000), subject to adjustments~~ and ~~the~~other ~~assumption~~indefinite-lived ofintangibles, ~~certain liabilities. At~~ the ~~Closing~~Company ~~Date,~~tests ~~LZG~~these ~~will~~assets ~~pay~~for ~~two~~impairment ~~hundred~~annually ~~thousand dollars ($200,000) in cash~~ and ~~will issue~~whenever ~~2,800,000~~events ~~shares~~or ofcircumstances ~~common~~make ~~stock~~it tomore ~~Intellagents.~~likely ~~The~~than ~~shares~~not ~~will~~that beimpairment ~~valued~~may athave ~~two million eight hundred thousand dollars ($2,800,000), $1~~occurred.00 ~~per~~For ~~share.~~the ~~The~~purposes ~~amount~~ of ~~shares~~that ~~may~~assessment, ~~be adjusted if~~ the ~~LZG~~Company ~~common~~has ~~stock~~determined isto ~~trading~~assign ~~under~~assets ~~$1.00~~acquired onin ~~the~~business ~~Closing~~combinations ~~Date.~~to ~~Post-closing adjustments may be used based upon~~ a ~~working~~single ~~capital~~reporting ~~statement~~unit toincluding beall ~~provided~~goodwill byand ~~LZG~~indefinite-lived ~~based~~intangible ~~upon the current~~ assets, ~~less~~acquired ~~current~~in ~~liabilities, determined~~business ~~as of the Closing Date~~combinations.

~~NOTE~~8 7Table –of ~~SUBSEQUENT EVENTS~~Contents

~~The~~LZG ~~Company~~International ~~has~~Inc ~~evaluated subsequent events from the balance sheet date through the date the financial statements were issued~~ and ~~has determined that there are no such events that would have a material impact on the financial statements.~~Subsidiary

10Notes to the Condensed Consolidated Financial Statements

InAugust ~~this report references to “LZG International~~31,” ~~“LZG,” “the Company,” “we,” “us,” and “our” refer to LZG International, Inc.~~ 2022

~~FORWARD LOOKING STATEMENTS~~(UNAUDITED)

The ~~U.S.~~estimated ~~Securities~~useful ~~and~~lives ~~Exchange~~for ~~Commission~~each ~~(“SEC”)~~intangible ~~encourages reporting~~asset ~~companies~~class to disclose forward-looking information so that investors can better understand future prospects and make informed investment decisions. This report contains these types of statements. Words such as “may,” “intend,” “expect,” “believe,” “anticipate,” “estimate,” “project,” or “continue” or comparable terminology used in connection with any discussion of future operating results or financial performance identify forward-looking statements. You are ~~cautioned not to place undue reliance on the forward-looking statements, which speak only~~ as of the date of this report. All forward-looking statements reflect our present expectation of future events and are subject to a number of important factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.follows:

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

		Estimated Useful Lives
AI Technology (Angelina FX)		5 years
Intellagents IT Platform and ecosystem		5 years
FatBrain IT		5 years
IP Technology, Prime Source		5 years

~~Executive~~Impairment ~~Overview~~Assessment

AsThe aCompany ~~result~~evaluates intangible assets and long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount of ~~LZG~~such ~~International,~~assets ~~Inc~~may not be recoverable.’ This includes but is not limited to significant adverse changes in business climate, market conditions or other events that indicate an asset's ~~acquisition~~ carrying amount may not be recoverable. Recoverability of ~~the~~these ~~FatBrain~~assets ~~technology~~is ~~pursuant~~measured toby comparing the ITcarrying ~~Asset~~amount ~~Contribution~~of ~~Agreement~~each ~~(“IT~~asset ~~Contribution~~to ~~Agreement”),~~the ~~dated~~future ~~October~~undiscounted ~~23, 2021,~~cash weflows ~~currently~~the ~~hold~~asset ~~intellectual~~is ~~property~~expected ~~assets,~~to ~~including~~generate. ~~patents~~If ~~pending,~~the ~~patents~~undiscounted cash flows used in ~~preparation,~~the ~~proprietary~~test ~~technology,~~for ~~development plans,~~recoverability ~~and~~are ~~contractual~~less ~~rights~~than ~~(“IT~~the ~~Assets”).~~carrying Onamount ~~April~~of 4,these ~~2022~~assets, the ~~Company~~carrying ~~changed~~amount ~~its~~of ~~corporate~~such ~~address~~assets is reduced to 54fair ~~West~~value. ~~40th Street~~For the year period ended August 31, ~~Suite~~ ~~1123~~2022, ~~New~~the ~~York,~~Company ~~New~~recorded ~~York~~no ~~10018~~impairments to intangible assets or long-lived assets.

~~The~~Sales ~~FatBrain IT Assets include software that uses artificial intelligence to help companies automate enterprise decision cycles to learn, explain~~ and intervene for better outcomes across all business interactions. The software continuously learns from historical transactions, incumbent models and in-house expert teams to deliver a unified framework binding structured and unstructured data in text, numerical, network/graph and video formats. The FatBrain software leverages modern advances in machine learning and cloud economics to enable sustained operational advantages of (i) simplicity with smaller, denser models using vector embeddings, (ii) auditability with explainable, trusted quantification and de-biasing using blockchain, (iii) quality work with noisy, sparse, imbalances or missing date using generative autoencoders, and (iv) technology using transfer and active learning. The Company has initiated the commercialization of the technology and we have spoken to several potential clients.Marketing

~~Our~~Sales ~~strength~~and ismarketing inexpenses ~~the~~are ~~uniqueness~~expensed ofand ~~our~~incurred ~~technology~~and ~~offering.~~primarily ~~Our~~consist ~~success will~~of ~~come~~costs ~~from~~associated ~~navigating~~with ~~the~~acquiring ~~various~~new ~~challenges~~clients ~~that~~or ~~drive~~selling ~~technology~~new ~~globally~~products. AsExpenses weinclude ~~initially~~salaries, ~~see marketing success in these various product offerings~~commissions, weonline ~~will~~advertising ~~continue~~costs toas ~~refine~~well ~~and~~as ~~adjust~~outsourced ~~our~~marketing ~~business model and operations until we achieve the profit margins that this technology and our product offering deserves~~strategy.

~~The~~General ~~Company will market our products directly~~ and through distribution with value added resellers and strategic partners. Direct marketing efforts include internet and email campaigns, tele-sales and virtual and in person follow ups. We anticipate having ten sales people able to work from anywhere. Distribution efforts include relationships with global and regional systems integrators (“SIs”), value added resellers (“VARs”), independent software vendors (“ISVs”), vertical software application developers and combinations of the above.Administrative

InGeneral ~~November~~and ofadministrative ~~2021,~~expenses ~~the~~consist ~~Company announced the launch~~ of ~~the~~costs ~~FatBrain~~primarily ~~product~~related ~~Angelina~~to AIfinance ~~Solution~~operations, ~~for~~human ~~Foreign~~resources, ~~Exchange~~executive ~~(“Angelina~~management, ~~FX”)~~legal, ~~part~~corporate ~~of our coached business wellness service (“BWS”) to tackle discriminatory pricing in the $6.6 trillion-dollar daily foreign exchange market. Previously~~technology, ~~FatBrain~~corporate ~~LLC had entered into a licensing agreement for our software with a non-related party~~development, ~~Tempus~~amortization, ~~Inc., a District of Columbia corporation owned by Monex S.A.B. (“Angelina Agreement”). After LZG acquired ownership of Angelina FX~~ and ~~the~~certain ~~contractual~~other ~~rights~~administrative tocosts ~~the~~that ~~licensing agreement, LZG and Tempus~~ are ~~using~~not ~~the~~directly ~~FatBrain~~attributed ~~AI automation software~~ to ~~grow and improve Tempus’ foreign exchange and global payments solutions based upon the prior licensing agreement. As~~ a ~~result,~~product ~~LZG~~or ~~earned $86,894 in AI subscription revenue for the Angelina Agreement for the nine-month period ended February 28, 2022~~service.

~~Our~~Research ~~product development moving forward includes new enhancements for self-service~~ and ~~quick~~Development reporting, as well as, simplified integration of Angelina FX into any affiliated website. Our agreement with Tempus includes integrating the Foreign Exchange Fair Value Report into 80-plus daily calls per day work-flow for each member of the Tempus customer account team. The marketing efforts include tuning messaging and developing new content for Tempus’ thousands of existing and prospective clients, comprising importers, exporters, SME’s and multinationals.Costs

11Research and development costs are expensed as incurred. Research and development costs include external costs of outside vendors engaged to design, test and program IT Technologies. Other research and development activities include salaries and related payroll expenses related to the Company’s research and development activities.

~~Intellagents~~Costs ~~Agreement~~for certain development activities are estimated based on an evaluation of the progress to completion of specific tasks using data such vendor representation. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred.

~~LZG~~Use ~~International entered into the Intellagents, LLC Asset Purchase Agreement (“Asset Purchase Agreement”), dated February 25, 2022. Subject to satisfaction or waiver~~ of each party’s conditions and obligations as outlined in the Asset Purchase Agreement, the parties will close this transaction at a future date (“Closing Date”). Management is currently taking the necessary steps to close the Asset Purchase Agreement.Estimates

~~Intellagents,~~In ~~LLC~~preparing isfinancial ~~engaged in the business of creating~~statements, ~~orchestrating~~management ~~and~~is ~~selling~~required ~~software~~to asmake aestimates ~~service,~~ and ~~software~~assumptions asthat aaffect ~~business, within~~ the ~~larger~~reported ~~insurance~~amounts ~~ecosystem~~of ~~services market.~~assets ~~Intellagents~~and ~~agreed~~liabilities, ~~to sell~~ and ~~assign~~disclosure ~~substantially all~~ of ~~its~~contingent assets, ~~properties~~ and ~~rights to LZG~~liabilities, ~~except~~at ~~for~~the ~~certain~~date ~~excluded assets and liabilities.~~

~~LZG agreed to purchase Intellagents’ assets for three million dollars ($3,000,000), subject to adjustments and the assumption~~ of ~~certain liabilities. At~~ the ~~Closing~~financial ~~Date~~statements, ~~LZG~~and ~~will pay~~revenues ~~two hundred thousand dollars ($200,000) in cash~~ and ~~will~~expenses ~~issue~~during ~~2,800,000 shares of common stock to Intellagents. The shares will be valued at two million eight hundred thousand dollars ($2,800,000), $1.00 per share. The amount of shares may be adjusted if~~ the ~~LZG~~reporting ~~common stock is trading under $1~~period.00 onActual ~~the~~results ~~Closing Date. Currently, the Company’s shares are not trading. Post-closing adjustments~~ may be ~~used~~differ ~~based~~from ~~upon~~these ~~a working capital statement to be provided by LZG based upon the current assets, less current liabilities, determined as of the Closing Date~~estimates. ~~Within sixty (60) days after the Closing Date, LZG shall prepare and deliver to Intellagents a statement setting forth its calculation of the working capital.~~

~~The~~9 ~~Asset~~Table ~~Purchase~~of Agreement provides that Intellagents will assign certain contracts and IP agreements to LZG, including Intellagents Division employment agreements with its officers Eric Hall, CEO; Mark Stender, President; and Michael Cocca, CTO.Contents

~~Material~~LZG ~~Changes~~International inInc ~~Financial~~and ~~Condition~~Subsidiary

~~Since~~Notes ~~we are in the initial phases of marketing the FatBrain technology, we may not record significant revenues and may lack funding~~ to cover our operating costs. These conditions raise substantial doubt about our ability to continue as a going concern. We are currently devoting our efforts to obtain capital from management, significant stockholders and/or third parties to cover minimal expenses; however, there is no assurance that additional funding will be available. Our ability to continue as a going concern during the ~~long~~Condensed ~~term~~Consolidated isFinancial ~~dependent upon our ability to produce and market the FatBrain technology.~~Statements

AtAugust ~~February 28, 2022, we had cash of $90,584 and total liabilities of $357,403 compared to cash of $4,735 and total liabilities of $294,610 at May~~ 31, ~~2021. Despite the increase in cash, we have not established ongoing sources of revenue sufficient to cover our operating costs at this time. During the nine-month period ended February 28,~~ 2022 ~~(“2022 nine-month period”) we relied upon revenues, advances and notes payable to cover our operating expenses.~~

Finalizing long-term, constant revenue generating technology contracts with our existing and other customers remains our greatest challenge because our on-going business is dependent on the types of revenues and cash flows generated by such contracts. Cash flow and cash requirement risks are closely tied to and are dependent upon our ability to attract significant long-term technology contracts(UNAUDITED)

~~During~~Basic ~~the next 12 months we anticipate incurring costs related to producing~~ and ~~marketing~~Fully ~~our~~Diluted ~~FatBrain~~Income ~~technology~~(Loss) ~~and~~Per ~~filing of Exchange Act reports. We believe we will be able to meet these costs through funds provided by management, significant stockholders and third parties until our revenues increase.~~Share

12In accordance with ASC 260, Earnings Per Share (“ASC 260”) the computations of basic loss per share of common stock are based on the weighted average number of common shares outstanding during the periods presented in the financial statements.

~~Material~~The ~~Changes~~computations of basic and fully diluted loss per share of common stock are based on the weighted average number of common shares outstanding during the periods presented in ~~Results~~the financial statements, plus the common stock equivalents, which would arise from the exercise of ~~Operations~~stock options and warrants outstanding during the period, or the exercise of convertible debentures. As of August 31, 2022, all common stock activity has been included and there were no items considered to be anti-dilutive.

~~During~~Software the 2022 nine-month period, we recorded revenues of $86,894 and relied on related party advances of $4,500 and notes payable of $38,500 to fund our operations. During the nine-months ended February 28, 2021 (“2021 nine-month period), we had no revenues and relied on advances or loans to fund our operations. We recorded net income of $6,640 for the 2022 nine-month period compared to a net loss of $22,960 for the 2021 nine-month period ended.Costs

WeThe ~~recorded~~Company ~~net~~follows ~~income~~ASC 985-20, Costs of ~~$13,767~~Computer ~~for~~Software ~~our~~to ~~third~~be ~~quarter~~Sold, ~~ended~~Leased, ~~February 28~~or Marketed, ~~2022~~whereby ~~(“2022~~costs ~~third~~incurred ~~quarter”)~~during ~~compared~~the period of planning and design, prior to athe ~~net~~period ~~loss~~determining oftechnological $6feasibility,~~841~~ for all software developed to be sold to external users, has been charged to operations in the ~~third~~period ~~quarter~~incurred ~~ended~~as ~~February~~research 28and development costs. Additionally, ~~2021~~costs ~~(“2021 third~~incurred ~~quarter”)~~after determination of readiness for market have been expensed as research and development. Purchased software that has reached technological feasibility and that has no alternative use, other than existing licenses or contracts for which it is being utilized, is capitalized at cost and amortized ratably over the term of the underlying contract.

~~Management~~Stock-based ~~expects net income to continue as we increase revenues from the marketing of the FatBrain technology.~~Compensation

~~Commitments~~The orCompany ~~Obligations~~accounts for stock-based compensation to employees and non-employees in conformity with the provisions of ASC 718, Stock Based Compensation. The Company expenses stock-based compensation to employees and non-employees over the requisite service period based on the estimated grant-date fair value of the awards. The Company accounts for forfeitures as they occur. Stock-based awards are recognized on a straight-line basis over the requisite service period.

~~During~~Common ~~the~~shares ~~2022~~issued ~~nine-month~~to ~~period,~~third aparties ~~stockholder paid~~ for ~~administrative and professional~~ services ~~totaling~~provided ~~$4,500,~~are ~~resulting~~valued inbased ~~amounts~~on ~~payable to~~ the ~~stockholder~~estimated offair ~~$10,500~~value ~~and $6,000 as~~ of ~~February 28, 2022 and May 31, 2021, respectively. On May 31, 2018~~ the ~~stockholder~~Company’s ~~converted~~common ~~$92,500 of its accounts payable to a promissory note, which bears interest at 8% per annum and is due on demand~~shares. ~~Due~~All tostock-based ~~subsequent~~compensation ~~additional~~costs ~~advances,~~are ~~the~~recorded ~~promissory~~in ~~note~~expenses ~~totaled~~in ~~$119,200 at February 28, 2022 and May 31, 2021. Interest expense was $7,152 for~~ the ~~nine~~condensed ~~months~~consolidated ~~ended~~statements ~~February 28, 2022, resulting in accrued interest~~ of ~~$31,897 and $24,745 at February 28, 2022 and May 31, 2021, respectively~~operations.

~~During~~Concentration ~~the 2022 nine-month period the Company borrowed $38,500 from a third party, resulting in notes payable~~ of ~~$108,300~~Credit and $69,800 at February 28, 2022 and May 31, 2021, respectively. The notes are due on demand, are not collateralized, and bear interest at 8% per annum. Interest expense was $4,941 for the nine months ended February 28, 2022, resulting in accrued interest of $34,989 and $30,048 at February 28, 2022 and May 31, 2021, respectively.Risk

~~During~~Financial ~~the~~instruments, ~~fiscal~~which ~~years~~potentially ~~ended~~subject ~~May~~the ~~31,~~Company ~~2009~~to ~~and~~concentrations ~~2010,~~of ~~our~~credit ~~Director and President~~risk, ~~Greg~~ L.consist ~~Popp,~~principally ~~loaned an aggregate~~ of ~~$23,500 to the Company~~cash. Cash Onbalances ~~April~~are ~~20,~~maintained ~~2010,~~in ~~these~~accounts ~~loans~~held ~~were~~by ~~combined~~major ~~into~~banks ~~one~~and ~~promissory~~financial ~~note~~institutions ~~which carries~~located ~~interest~~in atthe 8%United ~~and is not collateralized~~States. The ~~original~~Company ~~promissory~~may ~~note~~at ~~had~~times ahave ~~due~~balances ~~date~~in offinancial ~~June~~institutions ~~30,~~that ~~2014;~~are ~~however,~~more ~~Mr.~~than ~~Popp agreed to extend~~ the ~~due~~federally ~~date~~insured oflimit ~~this note and interest to June 30, 2022. Interest expense was $1,410 for the nine months ended February 28, 2022, resulting in accrued interest~~ of $22250,~~627 and $21,217 at February 28, 2022 and May 31, 2021, respectively~~000.

AtMajor ~~February 28, 2022, we owed venders $6,390.~~Customers

~~Emerging~~For ~~Growth~~the three months ended 08/31/22, the Company had two customers that accounted for $1,204,305 and and 49.5% of total sales. The Company expects to maintain this relationship with these customers.

We10 ~~qualify~~Table ~~as an emerging growth company as that term is used in the Jumpstart Our Business Startups Act~~ of 2012 (the “JOBS Act”). A company qualifies as an emerging growth company if it has total annual gross revenues of less than $1.07 billion during its most recently completed fiscal year and, as of December 8, 2011, had not sold common equity securities under a registration statement. Under the JOBS Act we are permitted to, and intend to, rely on exemptions from certain disclosure requirementsContents

InLZG ~~addition,~~International ~~Section~~Inc ~~107~~and of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.Subsidiary

13Notes to the Condensed Consolidated Financial Statements

~~ITEM~~August 3.31, ~~QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK~~2022

~~Not applicable to smaller reporting companies.~~(UNAUDITED)

~~ITEM~~NOTE 4.2 ~~CONTROLS~~– BUSINESS ~~AND PROCEDURES~~ACQUISITION

~~Disclosure~~On ~~Controls~~June 17, 2022, the Company entered into a Master Stock Purchase Agreement with two individuals, Yevgeniy Chsherbinin and ~~Procedures~~Victor Nazarov through its wholly owned subsidiary, FB PrimeSource Acquisition, LLC to acquire Prime Source, a Kazakhstani corporation and Prime Source’s affiliates consisting of Prime Source Innovation, Prime Source – Analytical Systems, Digitalism, and InFin-IT Solution (together with Prime Source, the “Prime Source Companies”).

AsThe ofCompany accounted for its acquisition as a business combination using the ~~end~~purchase method of ~~the~~accounting ~~period~~as ~~covered~~prescribed byin ~~this~~Accounting ~~quarterly~~Standards ~~report~~Codification 805, weBusiness ~~carried out~~Combinations an(“ASC ~~evaluation~~805”) ofand ~~the~~ASC ~~effectiveness~~820 of– ~~our~~Fair ~~disclosure~~Value ~~controls~~Measurements and ~~procedures~~Disclosures ~~under~~(“ASC ~~the~~820”). ~~supervision~~In ~~and~~accordance with ASC 805 and ASC 820, the ~~participation~~Company ofused ~~our Chief~~its ~~Executive~~best ~~Officer~~estimates and ~~Chief~~assumptions ~~Financial~~to ~~Officer.~~accurately ~~Our~~assign ~~controls~~fair value to the tangible assets acquired, identifiable intangible assets and ~~procedures~~liabilities ~~are~~assumed ~~designed~~as toof ~~allow~~the ~~information~~acquisition ~~required~~dates. toGoodwill beas ~~disclosed in~~of ~~our~~the ~~reports~~acquisition todate beis ~~recorded,~~measured ~~processed,~~as ~~summarized~~the ~~and~~excess ~~reported~~of ~~within~~purchase consideration over the ~~specified~~fair ~~periods,~~value of tangible and ~~accumulated~~identifiable intangible assets acquired and ~~communicated~~liabilities toassumed. ~~management to~~The ~~allow~~results ~~for~~of ~~timely~~operations ~~decisions~~of ~~regarding~~the ~~required~~acquired ~~disclosure~~businesses since the date of ~~material~~acquisition ~~information~~are included in the consolidated financial statements of the Company for the three months ended August 31, 2022. ~~Our~~The ~~disclosure~~total ~~controls~~purchase ~~and~~consideration ~~procedures~~was ~~are~~allocated ~~designed~~ to ~~provide~~the ~~reasonable~~assets ~~assurance~~acquired ofand ~~achieving~~liabilities assumed at their ~~objectives.~~estimated ~~Based~~fair ~~upon~~values as of the ~~evaluation~~date of acquisition, ~~our~~as ~~Chief~~determined ~~Executive~~by ~~Officer~~management. ~~concluded~~The ~~that~~excess ~~our disclosure~~of ~~controls~~the ~~and~~purchase ~~procedures~~price ~~were~~over ~~not~~the ~~effective~~amounts atallocated ~~that~~to ~~reasonable~~assets ~~assurance~~acquired ~~level~~and liabilities assumed has been recorded as goodwill. The value of the ~~end~~goodwill offrom the ~~nine-month~~acquisitions ~~period~~described ~~ended February~~below 28can be attributed to a number of business factors including, ~~2022~~but not limited to, cost synergies expected to be realized, the intellectual property acquired, and a trained technical workforce.

~~The~~In ~~material~~conjunction ~~weaknesses~~with ~~relate~~acquisition, the Company uses various valuation techniques to ~~the~~determine ~~limited~~fair ~~number~~value of ~~persons~~the ~~responsible for~~assets acquired, with the ~~recording~~primary ~~and~~techniques ~~reporting~~being discounted cash flow analysis, relief-from-royalty, a form of ~~financial~~the ~~information~~multi-period excess earnings and the with-and-without valuation approaches, which use significant unobservable inputs, or Level 3 inputs, as defined by the ~~lack~~fair ofvalue ~~separation~~hierarchy. ofInputs ~~financial~~to ~~reporting~~these ~~duties~~valuation approaches require significant judgment including: (i) forecasted sales, growth rates and ~~the~~customer ~~limited~~attrition ~~size~~rates, ~~of our~~(ii) ~~management~~forecasted ~~team~~operating inmargins, ~~general.~~(iii) Weroyalty ~~are~~rates inand discount rates used to present value future cash flows, (iv) the ~~process~~amount of ~~evaluating~~synergies ~~methods~~expected from the acquisition, (v) the economic useful life of ~~improving~~assets ~~our~~and ~~internal~~(vi) ~~control~~the ~~over~~evaluation ~~financial~~of ~~reporting~~historical tax positions. In certain acquisitions, ~~including~~ ~~the~~historical ~~possible~~data ~~addition~~is oflimited, ~~financial~~therefore, ~~reporting~~we ~~staff~~base our estimates and ~~the~~assumptions ~~increased~~on ~~separation~~budgets, ofbusiness ~~financial~~plans, ~~reporting~~economic ~~responsibility~~projections, anticipated future cash flows and ~~intend~~ marketplace data. We have engaged outside consultants to ~~implement~~assist ~~such~~us ~~steps~~with asthe ~~are~~valuation ~~necessary~~of ~~and~~our ~~possible~~acquisition. As toof ~~correct~~August ~~these~~31, ~~material~~2022, ~~weaknesses~~the results of their valuation are not yet available.

~~Changes~~The topurchase ~~Internal~~price ~~Control~~and ~~over~~purchase ~~Financial~~price ~~Reporting~~allocation cost of the acquisition completion date follows:

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Management conducted an evaluation of our internal control over financial reporting and determined that there were no changes made in our internal control over financial reporting during the quarter ended February 28, 2022 that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

Purchase Price:
Cash	$	5,723,388
Note Payable		12,000,000
Total Purchase Price, net of Cash Acquired		17,723,388

1411 Table of Contents

~~PART~~LZG IIInternational –Inc ~~OTHER~~and ~~INFORMATION~~Subsidiary

~~ITEM~~Notes 1.to ~~LEGAL~~the ~~PROCEEDINGS~~Condensed Consolidated Financial Statements

WeAugust ~~know of no material~~31, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our company.2022

~~ITEM 1A. RISK FACTORS~~(UNAUDITED)

A smaller reporting company is not required to provide the information required by this Item.

Assets Acquired:
Accounts Receivable Trade	$	3,653,805
Other Receivables		8,023
Inventory		3,831,736
Other Current Assets		7,171,688
Fixed Assets		94,453
Intangible Assets		1,009,336
Other Long-Term Assets		39,471
Total Assets Acquired		15,808,512

Liabilities Assumed:
Accounts Payable		2,686,944
Accrued Expenses		49,456
Deferred Revenue		8,596,996
Other Current Liabilities		2,348,669
Deferred Tax Liability		173,015
Total Liabilities Assumed		13,855,080
Net Assets Acquired		1,953,432
Excess Purchase Price “Goodwill”	$	15,769,956

~~ITEM~~The 2excess purchase price has been recorded as goodwill in the amount of $15,769,956. In ~~UNREGISTERED~~accordance ~~SALES~~with OFU.S. ~~EQUITY~~GAAP ~~SECURITIES~~for ~~AND~~goodwill ~~USE~~and OFother ~~PROCEEDS~~indefinite-lived intangibles, the Company tests Goodwill for impairment annually and whenever events or circumstances make it more likely than not that impairment may have occurred. For the purposes of that assessment, the Company has determined to assign assets acquired in business combinations to a single reporting unit including all goodwill and indefinite-lived intangible assets acquired in business combinations. The goodwill is amortizable for tax purposes.

~~None~~Identifiable intangible assets acquired by the business combination are amortized over the estimated useful lives of the assets as determined by management based on an assessment of the period over which the asset is expected to contribute to future cash flows. The estimated useful life of the identifiable intangible assets is five years

~~ITEM~~NOTE 3. ~~DEFAULTS~~– ~~UPON SENIOR SECURITIES~~REVENUES

~~None~~Deferred revenue is recorded when cash payments are received or due in advance of the Company’s performance, including amounts which are refundable. The Company typically sells software and services with a term from one month up to 1 year. Payments may be made by customers in advance, at the time of sale. As such, the company may receive up to 1 year of revenue in advance.

~~ITEM~~The 4transaction price allocated to the remaining performance obligations represents contracted revenue that has not yet been recognized, which may include unearned revenue and unbilled amounts that will be recognized as revenue in future periods. ~~MINE~~The ~~SAFETY~~transaction ~~DISCLOSURES~~price allocated to the remaining performance obligations is influenced by several factors, including the timing of renewals, the timing of delivery of software licenses, average contract terms, and foreign currency exchange rates. Unbilled portions of the remaining performance obligations are subject to future economic risks including bankruptcies, regulatory changes, and other market factors.

~~Not~~12 ~~applicable.~~Table of Contents

~~ITEM~~LZG 5.International ~~OTHER~~Inc ~~INFORMATION~~and Subsidiary

~~None.~~Notes to the Condensed Consolidated Financial Statements

~~ITEM~~August 6.31, ~~EXHIBITS~~2022

~~Part I Exhibits~~(UNAUDITED)

No.	Description
31.1	Chief Executive Officer Certification
31.2	Chief Financial Officer Certification
32.1	Section 1350 Certification

NOTE 4 – COMMITMENTS AND CONTINGENCIES

~~Part~~(a) ~~II Exhibits~~Commitments

No.	Description
3(i).1	Articles of Incorporation of LazyGrocer.Com, Inc., dated May 17, 2000 (Incorporated by reference to exhibit 3.1 to Form 10 filed May 26, 2010)
3(i).2	Amendment to Articles of Incorporation of LazyGrocer.Com, Inc., dated August 28, 2009 (Incorporated by reference to exhibit 3.1.2 to Form 10 filed May 26, 2010)
3(ii)	Bylaws of LZG International, Inc., effective January 28, 2010 (Incorporated by reference to exhibit 3.2 to Form 10 filed May 26, 2010)
10.1	IT Asset Contribution Agreement, dated October 23, 2021 (Incorporated by reference to exhibit 10.1 to Form 8-K, filed October 28, 2021)
10.2	FatBrain Master Services Agreement with Tempus, Inc., dated May 10, 2021 (Incorporated by reference to exhibit 10.1 to Form 8-K, filed October 28, 2021)
10.3	Intellagents, LLC Asset Contribution Agreement, dated February 23, 2022 (Incorporated by reference to exhibit 10.1 to Form 8-K, filed March 7, 2022)
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Label Linkbase Document
101.PRE	XBRL Taxonomy Presentation Linkbase Document
	** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

There are no significant commitments other than those disclosed in this paragraph and presented on the balance sheet. The Company does not lease any office space.

15(b) Contingencies

~~SIGNATURES~~In the normal course of business, from time to time, the Company could be involved in legal actions relating to the ownership and operations of the Company. In management’s opinion, the liabilities, if any, that may ultimately result from such legal actions are not expected to have a material adverse effect on the financial position, results of operations, or liquidity of the Company.

~~Pursuant~~NOTE to5 ~~the~~– ~~requirements~~GOING ~~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.~~CONCERN

~~LZG~~The ~~INTERNATIONAL~~accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has incurred losses since inception and has revenue-generating activities that do not exceed operational expenses. Historically, ~~INC~~its activities have been limited and have been dependent upon financing to continue operations. These factors raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. It is management’s plan to further develop and market its technology and acquire revenue generating companies.

Date:April 14, 2022	By: /s/ Greg L. Popp Greg L. Popp President
Date: April 14, 2022	By: /s/ Peter B. Ritz Peter B. Ritz Chief Executive Officer Chief Financial Officer

NOTE 6 – RELATED PARTY TRANSACTIONS

16As of August 31, 2022 and May 31, 2022, the financial statements include related party receivables, of $351,146 and $9,925,154, respectively. The stockholders of the related party also own stock in the Company. Of the amount held by the related party, $173,788 represents revenue proceeds from customers that have yet to be reimbursed to the Company at August 31, 2022, ($130,341 at May 31, 2022). The remaining amounts ($177,358 at 08/31/2022 and $9,794,813 at May 31, 2022) represent funds received by the related party on behalf of the Company from investors.

On May 11, 2022, the Company assumed a promissory note from a related party in connection with an asset acquisition. The $3,000,000 note bears interest at 8% per annum and is payable on Demand, no later than January 5, 2023. There have been no payments of principal or interest for the loan as of August 31, 2022. Accrued interest at August 31, 2022 is $71,836.

To assist with the orderly transition of management and operations, the Company entered into a Management Services Agreement with FatBrain LLC, a related party, effective 10/23/21. The Company has retained FatBrain LLC to provide consulting and logistical support when needed to support operating the business for a period of up to two years.

NOTE 7 – NOTES PAYABLE

On June 17, 2022 in connection with the Prime Source Acquisition, the Company issued two promissory notes of $6,000,000 to each of the former owners of Prime Source. Each loan bears interest of 8% and is payable on prescribed dates per a payment schedule. The final payment is due December, 31, 2023. As of August 31, 2022, the remaining balance due is $11,000,000 of which $6,000,000 is considered long term. Accrued interest on August 31, 2022 is $114,667.

Table of Contents

LZG International Inc and Subsidiary

Notes to the Condensed Consolidated Financial Statements

August 31, 2022

(UNAUDITED)

Description	Current Portion (Due 2023)		Long Term Portion (Due 2024)
Promissory Note - Yevgeniy Chsherbinin	$	2,000,000	$	3,000,000
Promissory Note - Victor Nazarov		3,000,000		3,000,000
Total Note Payable	$	5,000,000	$	6,000,000

NOTE 8 – LONG TERM INCENTIVE PLAN (LTIP)

On August 1, 2022, the Board of Directors approved the establishment of a Long-Term Incentive Plan (the “Plan”) with 13,838,657 shares of common stock available for issuance. The Plan permits the granting of Nonqualified Stock Options, Incentive Stock Options, Restricted Stock, and Restricted Stock Units. The Plan is intended to provide flexibility to the Company in its ability to motivate, attract and retain the services of Participants who make or are expected to make significant contributions to the Company’s success and to allow Participants to share in the success of the Company. From time to time, the Company may issue Incentive Awards pursuant to the Plan. Each of the awards will be evidenced by and issued under a written agreement.

If an incentive award granted under the Plan expires, terminates, is unexercised or is forfeited, or if any shares are surrendered to the company in connection with an incentive award, the shares subject to such award and the surrendered shares will become available for future awards under the Plan. The number of shares subject to the Plan, and the number of shares and terms of any Incentive Award may be adjusted in the event of any change in our outstanding common stock by reason of any stock dividend, spin-off, stock split, reverse stock split, recapitalization, reclassification, merger, consolidation, liquidation, business combination or exchange of shares, or similar transaction. For the three months ended August 31, 2022, 7,837,672 shares have been assigned and will vest annually over a four-year period starting August 1, 2023. There are 6,000,985 shares available for future grants under the plan.

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

	# of Restricted Shares		Weighted Average Grant Date FMV
Balance, May 31, 2022
Restricted shares, assigned		7,837,672	$	2.22
Restricted shares forfeited		-		-
Balance, August 31, 2022		7,837,672	$	2.22
Vested and Exercisable		-		-

Table of Contents

LZG International Inc and Subsidiary

Notes to the Condensed Consolidated Financial Statements

August 31, 2022

(UNAUDITED)

The restricted stocks vests over a four-year period which coincides with the requisite service period. Share-based expenses total $17,399,632 and are amortized over the vesting period. The expense recognized for the three months ended August 31, 2022, was $362,492. The remaining expenses ($17,037,140) will be amortized ratably over the remainder of the vesting period as follows:

Year ending May 31:	Amount
2023	$	3,262,431
2024		4,349,908
2025		4,349,908
2026		4,349,908
2027		724,985
Total	$	17,037,140

NOTE 9 – INCOME TAXES

As of August 31, 2022, the Company has available unused net operating loss carryforwards from its US based entities of approximately $4,922,000 ($1,210,000 at May 31, 2022) which may be applied against future taxable income, and which expire in various years from 2023 through 2040. Due to a substantial change in the Company’s ownership during October 2021, there may be annual limitations on the amount of previous net operating loss carryforwards that can be utilized.

The amount of and ultimate realization of the benefits from the net operating loss carryforwards for US income tax purposes is dependent, in part, upon the tax laws in effect, the future earnings of the Company, and other future events, the effects of which cannot be determined. Because of the uncertainty surrounding the realization of the net operating loss carryforwards, the Company has established a US valuation allowance equal to the tax effect of the net operating loss carryforwards and, therefore, no deferred tax asset has been recognized in the accompanying financial statements. The net US deferred tax assets are approximately $1,033,800 and $254,900 as of August 31, 2022 and May 31, 2022, respectively, with an offsetting valuation allowance of the same amount resulting in a change in the valuation allowance of approximately $788,900 and $127,890 for the three months ended August 31, 2022 and for the fiscal year ended May 31, 2022, respectively, (exclusive of effects of Federal tax rate changes).

Deferred tax assets and the valuation account are as follows:

	August 31, 2022			May 31, 2022
Deferred Tax Asset:
NOL Carryforward (at 21%)	$	1,033,800		$	254,900
Valuation Allowance		(1,033,800	)		(254,900	)
Deferred Tax Assets	$	-		$	-

A reconciliation of amounts obtained by applying the Federal tax rate of 21% to pretax income to income tax benefit is as follows:

	August 31, 2022			May 31, 2022
Federal Tax Benefit (at 21%)	$	780,000		$	194,000
Valuation Allowance		(780,000	)		(194,000	)
Deferred Tax Assets	$	-		$	-

On June 17, 2022, the Company, through its wholly owned subsidiary, FB Prime Source Acquisition, LLC, acquired all the stock of Prime Source, a Kazakhstani corporation. At the time of acquisition, the Company inherited a deferred tax liability related to the acquired business. As of August 31, 2022, the deferred tax liability ($183,866) has not been reviewed or recalculated by independent consultants. The Company has not yet made any adjustments to this amount.

Table of Contents

LZG International Inc and Subsidiary

Notes to the Condensed Consolidated Financial Statements

August 31, 2022

(UNAUDITED)

The Company did not have any tax positions for which it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase or decrease within the next 12 months.

The Company includes interest and penalties arising from the underpayment of income taxes in the statements of operations in the provision for income taxes. As of May 31, 2022 and 2021, the Company had no accrued interest or penalties related to uncertain tax positions.

The tax years that remain subject to examination by major taxing jurisdictions are those for the years ended May 31, 2018 through May 31, 2022

NOTE 10 – SUBSEQUENT EVENTS

The Company has evaluated subsequent events through October 14, 2022 which is the date the financial statements were available to be issued and determined that there were no subsequent events or transactions, other than the matters described below, that required recognition or disclosure in the financial statements.

In 2022, the Board of Directors approved the establishment of an Employee Stock Option Plan for its employees. Stock Option awards (incentive and nonqualified) may be issued under the terms of the plan. The Company has reserved 13,838,657 shares of common stock for issuance under the Plan. No written agreement has yet been signed.

On September 22, 2022, the Company entered into a Stock Purchase Agreement to purchase all the outstanding shares of SO Technology, LTD, a UK-based design and technology company creating web and mobile applications for mid-market enterprises. The aggregate purchase price was $2,762,500 and is payable in $1,700,000 cash and 170,000 shares of stock valued at $6.25/share or $1,062,500 total stock value.

Table of Contents

In this report references to “LZG International,” “the Company,” “we,” “us” or “our” refer to LZG International, Inc., a Florida corporation

FORWARD-LOOKING STATEMENTS

The U. S. Securities and Exchange Commission (“SEC”) encourages reporting companies to disclose forward-looking information so that investors can better understand future prospects and make informed investment decisions. This report contains these types of statements. Words such as “may,” “intend,” “expect,” “believe,” “anticipate,” “estimate,” “project,” or “continue” or comparable terminology used in connection with any discussion of future operating results or financial performance identify forward-looking statements. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. All forward-looking statements reflect our present expectation of future events and are subject to a number of important factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.

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

Executive Overview

LZG International, Inc. was a “blank check” company until acquired by the current management team on October 23, 2021 (“AI Recap”). Incorporated in the State of Florida on May 22, 2000, as LazyGrocer.Com, Inc., the company offered an online grocery solution, limited its operations in November 2001 and changed its name to LZG International, Inc., on August 28, 2009.

As part of the AI Recap, we capitalized the company with software and related IT Assets, including the Outcomes™ engine and the connected AI Solutions, that use artificial intelligence (“AI”) to help businesses automate and optimize enterprise decision cycles (“AI Solutions”).

Since 2015, our Outcomes™ engine and platform have enabled scores of innovations across dozens of F500 business cases, billions of transactions, and hundreds of millions of behavioral profiles.

In 2019, for example, our AI solution for Bank of America outperformed by over 60% the combined effectiveness and efficiency of BOA’s $100M state of the art system and 800 of its investigative experts to fight financial crimes.

In November 2021, we launched a foreign exchange (“FX”) AI solution to tackle discriminatory pricing, especially with the start-up, small and mid-sized enterprises (“SMEs”) in the $6.6 trillion-dollar daily FX market. The solution uses our Peer Intelligence technology to auto-match individual client’s purchase cycles with their currency and supply chain risk to optimize FX and minimize constraints, across thousands of peers, in hundreds of sectors.

On February 23, 2022, we acquired the software assets of Intellagents, LLC, to accelerate our insurance focus.

During the period covered by this report, the Company acquired the capital stock of Prime Source and certain affiliates (“Prime Source”), as described in the current report on Form 8-K filed on June 24, 2022. The business of Prime Source is owned by a wholly-owned subsidiary of the Company, and is being integrated into the world-wide business of the Company.

Prime Source Agreement

LZG International entered into a Master Stock Purchase Agreement (“Stock Purchase Agreement”), dated as of June 17, 2022, with two individuals, Yevgeniy Chsherbinin and Victor Nazarov (together “Sellers”), through its wholly owned subsidiary, FB PrimeSource Acquisition, LLC (“Buyer”) to acquire Prime Source, a Kazakhstani corporation (“Prime Source”) and Prime Source’s affiliates consisting of Prime Source Innovation, Prime Source – Analytical Systems, Digitalism, and InFin-IT Solution (together with Prime Source, the “Prime Source Companies”) (See the Stock Purchase Agreement, filed as Exhibit 10.6 to this report). The parties closed this transaction on June 17, 2022 (“Closing Date”).

Table of Contents

Prime Source, the largest independent IT solutions provider in Kazakhstan, is engaged in the business of software development, technology solutions, data management and strategic IT consulting. The Sellers agreed to sell and assign all of their ownership interests and rights in the Prime Source Companies to LZG’s subsidiary, Buyer.

LZG agreed to purchase Prime Source for eighteen million dollars ($18,000,000), subject to a payment schedule.

Except for the Stock Purchase Agreement and the transactions contemplated thereby, neither Sellers, nor Prime Source, nor any of its officers or directors serving before the Stock Purchase Agreement had any material relationship with LZG or LZG’s affiliates prior to this transaction.

Material Changes in Financial Condition

Since we are in the initial phases of marketing the FatBrain technology, we may not record significant revenues and may lack funding to cover our operating costs. These conditions raise substantial doubt about our ability to continue as a going concern. We are currently devoting our efforts to obtain capital from management, significant stockholders and/or third parties to cover expenses; however, there is no assurance that additional funding will be available. Our ability to continue as a going concern during the long term is dependent upon our ability to produce and market the FatBrain technology.

At August 31, 2022, we had cash of $967,572 and total liabilities of $23,885,753 compared to cash of $81,567 and total liabilities of $3,149,738 at May 31, 2022. We have not established ongoing sources of revenue sufficient to cover our operating costs at this time. During the three-month period ended August 31, 2022 (“2023 three-month period”) we generated $2,432,812 of revenue but still relied upon advances from related parties to fund our operations. The current conditions continue to raise substantial doubt about our ability to continue as a going concern. We are currently devoting our efforts to obtaining capital from stockholders and are seeking to acquire additional companies with established revenue sources. Our ability to continue as a going concern is dependent upon our ability to find additional investors and the ability to acquire additional businesses with established revenues.

During the next 12 months we anticipate incurring costs related to producing and marketing our FatBrain technology and filing of Exchange Act reports. We believe we will be able to meet these costs through funds provided by management, significant stockholders and third parties until our revenues increase.

Material Changes in Results of Operations

During the 2023 three-month period, we recorded revenues of $2,432,812 and net loss of ($3,713,161). For the three-month period ended 08/31/21, there was no revenue and net loss was ($13,976).

Management expects revenue to increase as we enhance our efforts to market the products using the FatBrain technology.

Commitments or Obligations

On May 11, 2022, the Company assumed a promissory note from a related party in connection with an asset acquisition. The $3,000,000 note bears interest at 8% per annum and is payable on Demand, no later than January 5, 2023. The accrued interest on the loan is $71,836 at August 31, 2022.

On June 17, 2022, the Company entered into a Master Purchase Agreement with Prime Source. Two promissory loan of $6,000,000 to each of the former owners was secured as part of the purchase price. Each note bears interest of 8$. The loan payments are set to a payment scheduled through December 31, 2023. Accrued Interest at August 31, 2022 is $114,667.

Table of Contents

Emerging Growth Company

We qualify as an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). A company qualifies as an emerging growth company if it has total annual gross revenues of less than $1.07 billion during its most recently completed fiscal year and, as of December 8, 2011, had not sold common equity securities under a registration statement. Under the JOBS Act we are permitted to, and intend to, rely on exemptions from certain disclosure requirements

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

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

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our filings under the Exchange Act is recorded, processed, summarized and reported within the periods specified in the rules and forms of the SEC. This information is accumulated to allow timely decisions regarding required disclosure.

Our President, who serves as our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report and he determined that our disclosure controls and procedures were ineffective because we had a control deficiency. During the period we did not have additional personnel to allow segregation of duties to ensure the completeness or accuracy of our information. Due to the size and operations of our Company we are unable to remediate this deficiency until we acquire or merge with another company with more personnel.

Changes to Internal Control over Financial Reporting

Management is responsible to establish and maintain adequate internal control over financial reporting. Our principal executive officer is responsible to design or supervise a process that provides reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The policies and procedures include:

	·	maintenance of records in reasonable detail to accurately and fairly reflect the transactions and dispositions of assets,
	·	provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of management and directors, and
	·	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on our financial statements.

For the Quarter ended August 31, 2022, management has relied on the Committee of Sponsoring Organizations of the Treadway Commission (COSO - 2013), “Internal Control - Integrated Framework,” to evaluate the effectiveness of our internal control over financial reporting. Based upon that framework, management determined that in the preparation of the financial statements we did not have additional personnel to allow segregation of duties to ensure the completeness or accuracy of our information. Accordingly, our President has concluded that our internal control over financial reporting is ineffective because lack of an adequate control environment constitutes a deficiency. Due to the size and operations of the Company we are unable to remediate this deficiency until we acquire or merge with another company with more personnel.

Our management determined that there were no changes made to our internal controls over financial reporting during the quarter ended August 31, 2022, that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

Table of Contents

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We know of no material, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our company.

Item 1a. Risk Factors

A smaller reporting company is not required to provide the information required by this Item.

Item 2. Unregistered Sales Of Equity Securities And Use Of Proceeds

The Company issued 2,800,000 shares of its common stock to Intellagents, LLC (“Intellagents”) along with cash in exchange for Intellagents’ Smart Insurance Ecosystem Platform in accordance with the Updated Asset Purchase Agreement as reported by the Company on Form 8-K filed on August 23, 2022. We relied on an exemption from the registration requirements provided by Section 4(a)(2) of the Securities Act.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Table of Contents

Item 6. Exhibits.

Exhibit No.		Description
Part I
31.1		Certification of the Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-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 Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-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 Principal Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
32.2		Certification of the Principal Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**

Part II
3.1		Articles of Incorporation dated May 17, 2000. (1)
3.1.2		Amendment to Articles of Incorporation dated August 28, 2009. (1)
3.2		Bylaws of LZG International, Inc., effective January 28, 2010. (1)
4.6		Description of Securities. (2)
10.1		FatBrain, LLC IT Asset Contribution Agreement, dated October 23, 2021. (3)
10.2		Subscription Agreement Form. (4)
10.3		FatBrain Master Services Agreement with Tempus, Inc., dated May 10, 2021. (5)
10.4		Intellagents, LLC Asset Contribution Agreement, dated February 23, 2022. (6)
10.5		Asset Contribution Agreement dated as of April 1, 2022, and effective May 11, 2022, by and among LZG International, Inc and FatBrain LLC. (7)
10.6		Master Stock Purchase Agreement dated as of June 17, 2022, by and among Yevgeniy Chsherbinin, Victor Nazarov, and FB PrimeSource Acquisition, LLC. (8)
101.INS		Inline XBRL Instance Document*
101.SCH		Inline XBRL Taxonomy Extension Schema Document*
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document*
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document*
101.LAB		Inline XBRL Taxonomy Extension Labels Linkbase Document*
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document*
104		Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit).*

*	Filed herewith
**	Furnished herewith

(1)	Incorporated by reference to the Company’s Form 10, filed on May 26, 2010.
(2)	Incorporated by reference to the Company’s Form 10-K, filed on August 29, 2019.
(3)	Incorporated by reference to the Company’s Form 8-K, filed on October 28, 2021.
(4)	Incorporated by reference to the Company’s Form 8-K, filed on November 26, 2021.
(5)	Incorporated by reference to the Company’s Form 10-Q, filed on January 20, 2022.
(6)	Incorporated by reference to the Company’s Form 8-K, filed on March 7, 2022.
(7)	Incorporated by reference to the Company’s Form 8-K, filed on May 17, 2022.
(8)	Incorporated by reference to the Company’s Form 8-K, filed on June 24, 2022.

Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

October 17, 2022	LZG International, Inc.

	By:	/s/ Peter B. Ritz
	Name:	Peter B. Ritz
	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.

Name	Position	Date

/s/ Peter B. Ritz	Chief Executive Officer	October 17, 2022
Peter B. Ritz	(Principal Executive Officer)

/s/ Peter B. Ritz	Chief Financial Officer	October 17, 2022
Peter B. Ritz	(Principal Financial and Accounting Officer)

Filing Compare · LZG INTERNATIONAL, INC.