RENEWABLE INNOVATIONS, INC. - Quarter Report: 2022 February (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

For the quarterly period ended February 28, 2022

For the transition period from _______________ to _______________

Commission File Number: 000-55875

Nestbuilder.com Corp.

(Exact name of registrant as specified in its charter)

(201) 845-7001

(Registrant’s telephone number, including area code)

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 such files). ☒ Yes ☐ No

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

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

Applicable only to issuers involved in bankruptcy proceedings during the preceding five years:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. ☐ Yes ☐ No

Applicable only to corporate issuers:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of April 18, 2022, there were 5,643,509 shares of common stock, par value $0.0001, issued and outstanding.

Nestbuilder.com Corp.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

This Quarterly Report includes forward-looking statements within the meaning of the Securities Exchange Act of 1934 (the “Exchange Act”). These statements are based on management’s beliefs and assumptions, and on information currently available to management. Forward-looking statements include the information concerning our possible or assumed future results of operations set forth under the heading “Management’s Discussion and Analysis of Financial Condition or Plan of Operation.” Forward-looking statements also include statements in which words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “consider” or similar expressions are used.

Forward-looking statements are not guarantees of future performance. They involve risks, uncertainties and assumptions. Our future results and shareholder values may differ materially from those expressed in these forward-looking statements. Readers are cautioned not to put undue reliance on any forward-looking statements.

NESTBUILDER.COM CORP.

Balance Sheets

Unaudited

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

NESTBUILDER.COM CORP.

Statements of Operations

(Unaudited)

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

Statement of Changes in Stockholders’ Deficit

(Unaudited)

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

NESTBUILDER.COM CORP.

Statements of Cash Flows

(Unaudited)

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

NESTBUILDER.COM CORP.

CONDENCED NOTES TO THE FINANCIAL STATEMENTS

FEBRUARY 28, 2022

UNAUDITED

NOTE 1: ORGANIZATION AND NATURE OF BUSINESS

Organization

We were incorporated in the State of Nevada on January 10, 2017 as a wholly owned subsidiary of RealBiz Media Group, Inc., a Delaware corporation (“RealBiz”). On July 31, 2018, RealBiz effectuated our spin-off from RealBiz. Upon completion of the spin-off, RealBiz stockholders owned 100% of the outstanding shares of our common stock.

We are engaged in the business of providing digital media and marketing services for the real estate industry. We currently generate revenue from service fees (video creation and production and referral fees from our LoseTheAgent.com website). At the core of our programs is our proprietary video creation technology which allows for an automated conversion of data (text, video slices and pictures of home listings) to a video with voice over and music. We provide video search, storage and marketing capabilities on multiple platform dynamics for web and mobile. Once a home, personal or community video is created using our proprietary technology, it can be published to social media, email or distributed to multiple real estate websites.

In addition, we own and operate the web site LoseTheAgent.com, which is a site dedicated to peer-to-peer real estate transactions between home sellers and buyers - the so called For Sale By Owner segment. We currently have approximately 100,000 home listings across all 50 states. We monetize the website by charging fees for both listing a home for sale and picking up possible buyers’ messages of interest. We also plan on generating additional revenues by monetizing seller/buyer data with targeted, interested parties. The web site is fully functional and is being marketed via various online platforms.

Products and Services

We currently offer the following products and services:

Enterprise Video Production: We service large and small broker accounts in the North America Real Estate Market in compiling listings into a Video format and distributing to those franchisor’s websites, brokers and agents and lead generation platforms 24/7. Some of these multiyear contracts produced over 10 million video listings from 2012-2014. These volumes, however, have declined beginning in 2017. We currently have the ability to produce over 15,000 videos per day.

The Virtual Tour (VT): This program was developed and implemented to allow agents to access specific video based product strategies that are designed specifically to increase the SEO rank and traffic credit to real estate franchise systems and/or their brokers.

LoseTheAgent.com: We own and operate the web site LoseTheAgent.com, which is a site dedicated to peer-to-peer real estate transactions between home sellers and buyers - the so called For Sale By Owner (FSBO) segment. We currently have approximately 100,000 home listings across all 50 states. We monetize the website by charging fees for both listing a home for sale and picking up possible buyers’ messages of interest. We also plan on generating additional revenues by monetizing seller/buyer data with targeted, interested parties. The web site is functional and is being marketed via various online platforms.

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10K and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (all of which are of a normal recurring nature) considered necessary for a fair presentation have been included. Operating results for the three months ended February 28, 2022 are not indicative of the results that may be expected for the year ending November 30, 2022 or for any other future period. These unaudited financial statements and the unaudited condensed notes thereto should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Form 10-K for the year ended November 30, 2021, filed with the Securities and Exchange Commission (the “SEC”) on December 30, 2021.

Cash and Cash Equivalents

The Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents. There were no cash equivalents as of February 28, 2022 and November 30, 2021.

Property and Equipment

All expenditures on the acquisition for property and equipment are recorded at cost and capitalized as incurred, provided the asset benefits the Company for a period of more than one year. Expenditures on routine repairs and maintenance of property and equipment are charged directly to operating expense. The property and equipment are depreciated based upon its estimated useful life after being placed in service. The estimated useful life of computer equipment is 3 years. When equipment is retired, sold or impaired, the resulting gain or loss is reflected in earnings. The Company’s Property and Equipment are fully depreciated.

Impairment of Long-Lived Assets

In accordance with Accounting Standards Codification (“ASC”) 360-10, “Property, Plant, and Equipment”, the Company periodically reviews its long- lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value. The Company did not impair any long-lived assets as of February 28, 2022, and November 30, 2021.

Website Development Costs

The Company accounts for website development costs in accordance with Accounting Standards Codification 350-50 “Website Development Costs”. Accordingly, all costs incurred in the planning stage are expensed as incurred, costs incurred in the website application and infrastructure development stage that meet specific criteria are capitalized and costs incurred in the day-to-day operation of the website are expensed as incurred.

Fair Value of Financial Instruments

ASC topic 820, “Fair Value Measurements and Disclosures” (ASC 820) defines “fair value” as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

ASC 820 also describes three levels of inputs that may be used to measure fair value:

Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets.

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 that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value.

Financial instruments consist principally of cash, accounts payable, accrued liabilities and other current liabilities. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short- term nature. The fair value of long-term debt is based on current rates at which the Company could borrow funds with similar remaining maturities. The carrying amounts approximate fair value. It is management’s opinion that the Company is not exposed to any significant currency or credit risks arising from these financial instruments.

Revenue Recognition

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). This standard provides a single model for revenue arising from contracts with customers and supersedes current revenue recognition guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. We adopted the standard effective December 1, 2018, with no cumulative adjustment needed as of this date. All of our revenue is generated from the United States of America.

Revenue is recognized when all of the following criteria are met:

●Identification of the contract, or contracts, with a customer - A contract with a customer exists when (i) we enter into an enforceable contract with a customer that defines each party’s rights regarding the goods or services to be transferred and identifies the payment terms related to these goods or services, (ii) the contract has commercial substance and the parties are committed to perform, and (iii) we determine that collection of substantially all consideration to which it will be entitled in exchange for goods or services that will be transferred is probable based on the customer’s intent and ability to pay the promised consideration.

●Identification of the performance obligations in the contract - Performance obligations promised in a contract are identified based on the goods or services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the goods or service either on its own or together with other resources that are readily available from third parties or from us, and are distinct in the context of the contract, whereby the transfer of the goods or services is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised goods or services, we apply judgment to determine whether promised goods or services are capable of being distinct and distinct in the context of the contract. If these criteria are not met the promised goods or services are accounted for as a combined performance obligation.

●Determination of the transaction price - The transaction price is determined based on the consideration to which we will be entitled in exchange for transferring goods or services to the customer adjusted for estimated variable consideration, if any. We typically estimate the transaction price impact of discounts offered to the customers for early payments on receivables or rebates based on channel partner sales achievements. Constraints are applied when estimating variable considerations based on historical experience where applicable.

●Allocation of the transaction price to the performance obligations in the contract - All current contracts are of a single performance obligation thus the entire transaction price is allocated to the single performance obligation. We determine standalone selling price taking into account available information such as historical selling prices of the performance obligation, geographic location, overall strategic objective, market conditions and internally approved pricing guidelines related to the performance obligation.

●Recognition of revenue when, or as, we satisfy performance obligation - We satisfy performance obligations either over time or at a point in time as discussed in further detail below. Revenue is recognized at or over the time the related performance obligation is satisfied by transferring a promised good or service to a customer.

Cost of Revenues

Cost of revenues includes costs attributable to services sold and delivered. These costs include engineering costs incurred to maintain our networks.

Advertising Expense

Advertising costs are charged to expense as incurred and are included in marketing and promotions expense in the accompanying financial statements. Advertising expense for the three months ended February 28, 2022 and February 28, 2021 were $32 and $79, respectively.

Share-Based Compensation

The Company computes share based payments in accordance with Accounting Standards Codification 718-10 “Compensation” (ASC 718-10). ASC 718-10 establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods and services at fair value, focusing primarily on accounting for transactions in which an entity obtains employees services in share-based payment transactions. It also addresses transactions in which an entity incurs liabilities in exchange for goods and services that are based on the fair value of an entity’s equity instruments or that may be settled by the issuance of those equity instruments. In March 2005, the SEC issued SAB No. 107, Share-Based Payment (“SAB 107”) which provides guidance regarding the interaction of ASC 718-10 and certain SEC rules and regulations. The Company has applied the provisions of SAB 107 in its adoption of ASC 718-10. The Company estimates the fair value of stock options by using the Black-Scholes option pricing model. Additionally, the Company has early adopted ASU 2018-07 during fiscal year 2019. In June 2018, the FASB issued ASU 2018-07 Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (ASU 2018-07), which simplifies the accounting for share-based payments to nonemployees by aligning it with the accounting for share-based payments to employees, with certain exceptions.

Income Taxes

The Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes. Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities and net operating loss and tax credit carryforwards given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based on changes to the assets or liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which the Company operates, estimates of future taxable income, and available tax planning strategies. If tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more likely than not” criteria of ASC 740.

ASC 740-10 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company has applied for an extension of time to file with the Internal Revenue Service for its most recent tax filing.

The Company recognizes expenses for tax penalties and interest assessed by the Internal Revenue Service and other taxing authorities upon receiving valid notice of assessments. The Company has received no such notices as of February 28, 2022.

Earnings Per Share

Basic earnings per share is computed by dividing net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period.

Diluted earnings per share is computed by dividing net income attributable to common stockholders by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. Diluted loss per common share is equal to basic because the common stock equivalents are anti-dilutive. The Company’s anti-dilutive common stock equivalents include the following:

 SCHEDULE OF ANTI-DILUTIVE SECURITIES OUTSTANDING

Concentrations, Risks and Uncertainties

The Company’s operations and revenue are related to the real estate industry and its prospects for success are tied indirectly to interest rates and the general housing and business climates in the United States. Financial instruments and related items, which potentially subject the Company to concentration of credit risk consists primarily of cash. The Company places its cash with high credit quality institutions. At times, such deposits may be in excess of the FDIC insurance limit of $250,000. The Company did not have cash on deposit in excess of such limit at February 28, 2022.

Recently Issued Accounting Standards

In February 2016, the FASB issued ASU 2016-02, Leases (“ASU 2016-02”). The standard amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. The company does not have any leasing arrangements.

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued and not implemented that might have a material impact on its financial position or results of operations.

NOTE 3: GOING CONCERN

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

At February 28, 2022, the Company had a working capital deficit of $26,593, an accumulated deficit of $778,990 and a net loss of $162,928 for the quarter ended February 28, 2022. It is management’s opinion that these facts raise substantial doubt about the Company’s ability to continue as a going concern for a period of twelve months from the date of this filing, without additional debt or equity financing. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts nor to the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

In order to meet its working capital needs through the next twelve months and to fund the growth of our business, the Company may consider plans to raise additional funds through the issuance of additional shares of common or preferred stock and or through the issuance of debt instruments. Although the Company intends to obtain additional financing to meet our cash needs, the Company may be unable to secure any additional financing on terms that are favorable or acceptable to it, if at all.

In December 2019, a novel coronavirus (“COVID-19”) emerged and has subsequently spread worldwide. The World Health Organization has declared COVID-19 a pandemic resulting in federal, state, and local governments mandating various restrictions, including travel restrictions, restrictions on public gatherings, stay at home orders and advisories and quarantining of people who may have been exposed to the virus.

COVID-19 Update

In March 2020, the World Health Organization declared the COVID-19 outbreak to be a global pandemic. The pandemic has had significant impacts around the globe and in many locations in which we operate. While the impacts have not caused a material adverse financial impact to our business to date, the future impacts remain uncertain. The extent to which the COVID-19 pandemic may impact our business going forward will depend on numerous evolving factors that we cannot reliably predict. The effect, if any, of the COVID-19 pandemic would not be fully reflected in our results of operations and overall financial performance until future periods.

As of February 28, 2022, COVID-19 has not had a material impact on our results of operations or financial condition.

Note 4: PROPERTY AND EQUIPMENT

At February 28, 2022 and November 30, 2021, the Company’s property and equipment are as follows:

 SCHEDULE OF PROPERTY AND EQUIPMENT

The Company’s fixed assets are fully depreciated.

NOTE 5: ACCOUNTS PAYABLE AND ACCRUED EXPENSES

The Company’s accounts payable and accrued expenses are as follows:

 SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES

NOTE 6: RELATED PARTY TRANSACTIONS

Convertible Promissory Notes

During the quarter ended February 28, 2022, Mr. Aliksanyan, our Chief Executive Officer and board member, Mr. Grbelja, our Chief Financial Officer and board member, and Mr. McLeod, our Secretary and board member, converted promissory notes for common stock as part of a Note Conversion and Warrant Amendment Agreement (See Note 7 and Note 9).

Common Stock Purchase Warrants

On February 4, 2022, the Company issued 5,075,000 common stock warrants to its officers and directors. Each warrant is convertible into 1 share of common stock with an exercise price of $0.0925. The warrants expire on February 4, 2027. Pursuant to the terms of the Common Stock Purchase Warrants, 1/4th of the total number of shares underlying the warrants will vest and become exercisable on the first anniversary of the date of issuance, and an additional l/12th of the total number of remaining shares underlying the warrants will vest and become exercisable on each of the monthly anniversaries thereafter, in each case, so long as the holder continues to be a service provider of the Company. The foregoing vesting schedule is subject to acceleration in the event of the service provider’s death, disability, termination without cause or a change in control of the Company. There was $33,833 of stock based compensation included in general and administrative expenses and $778,167 of unvested stock based compensation expense as of February 28, 2022 which will be recognized through February 28, 2024.

Restricted Stock Awards

On February 4, 2022, the Company issued 825,000 shares of restricted common stock to its officers and directors at a price per share of $0.0925, the fair market value at the date of issuance. Pursuant to the terms of the Restricted Stock Award Agreements, the restricted common stock vests in a series of eight (8) successive equal quarterly installments beginning on the date of grant, provided that the grantee continuously provides services to the Company as an employee, officer, director, contractor or consultant through the applicable vesting date. The foregoing vesting schedule is subject to acceleration in the event of the service provider’s death, disability, termination without cause, or a change in control of the Company. There was $5,500 of stock based compensation included in general and administrative expenses and $126,500 of unvested restricted stock based compensation expense as of February 28, 2022 that will be recognized through February 28, 2024.

NOTE 7: STOCKHOLDERS’ DEFICIT

The total number of shares of all classes of stock that the Company shall have the authority to issue is 275,000,000 shares consisting of: 250,000,000 shares of common stock with a $0.0001 par value per shares; and 25,000,000 shares of preferred stock, par value $0.0001 per share. On May 31, 2019, we filed a certificate of designation with the Secretary of State of the State of Nevada to create a new class of preferred stock designated as the Series A Convertible Preferred Stock. The holders of Series A Convertible Preferred Stock are entitled to receive dividends in an amount equal to any dividends or other Distribution on the Common Stock. The holders of Series A Convertible Preferred Stock are entitled to be paid out of the Available Funds and Assets, in preference to any payment or distribution of any Available Funds and Assets on any shares of Common Stock or subsequent preferred stock, an amount per share equal to the Original Issue Price of the Series A Convertible Preferred Stock plus all declared but unpaid dividends on the Series A Convertible Preferred Stock. Each share of Series A Convertible Preferred Stock is convertible, at the option of the holder thereof, at any time after the issuance of such share, into one (1) share of Common Stock. As of February 28, 2022, there were 5,643,509 shares of common stock issued, of which 1,375,000 shares are restricted stock, 4,268,509 shares of common stock outstanding, and zero shares of Series A Convertible Preferred Stock issued and outstanding.

Common Stock

On February 4, 2022, the Company issued 1,375,000 shares of restricted common stock at $0.0925 per share to its officers, contracted consultants and professionals. Pursuant to the terms of the Restricted Stock Award Agreements, the restricted common stock vests in a series of eight (8) successive equal quarterly installments beginning on the date of grant, provided that the grantee continuously provides services to the Company as an employee, officer, director, contractor or consultant through the applicable vesting date. The foregoing vesting schedule is subject to acceleration in the event of the service provider’s death, disability, termination without cause, or a change in control of the Company. There was $9,167 of stock based compensation included in general and administrative expense and $210,833 of unvested restricted stock based compensation expense as of February 28, 2022 that will be recognized through February 28, 2024. As of February 28, 2022, the restricted stock was not vested and therefore not outstanding.

On February 7, 2022, our existing noteholders exercised their conversion rights and were issued 678,180 shares of common stock at $0.07 and 630,029 shares of common stock at $0.035 for a total value of $69,554. As an incentive to convert their notes, three noteholders agreed to a modification where they converted a portion of their notes at $0.035 per common share. The share price at the time of the conversion was $0.177 which resulted in a loss on debt extinguishment of $55,712, which is included in the loss on extinguishment of debt of $72,198 on the Statement of Operations as of February 28, 2022.

On February 28, 2022, the company issued 1,287,500 shares of its common stock at $0.08 in exchange for $67,000 in cash and a stock subscription receivable of $36,000. The $36,000 of the stock subscription receivable was received subsequent to quarter end, in March 2022.

Common Stock Purchase Warrants

2021 Warrants

In June 2021, the Company issued an additional 80,000 warrants pursuant to the Securities Purchase Agreement and issuance of convertible notes in the amount of $16,000. The warrants have an exercise price of $0.10 per share and the warrants vest immediately and expire on December 31, 2022. The grant date fair value was zero.

In September 2021, the Company issued an additional 18,005 warrants pursuant to the Securities Purchase Agreement and issuance of convertible notes in the amount of $3,601. The warrants have an exercise price of $0.10 per share and the warrants vest immediately and expire on December 31, 2022. The grant date fair value was zero.

2022 Warrants

In January 2022, the Company issued an additional 100,000 warrants pursuant to the Securities Purchase Agreement and issuance of convertible notes in the amount of $20,000. The warrants have an exercise price of $0.10 per share and the warrants vest immediately and expire on December 31, 2022. The Company recorded $6,275 of interest expense for these awards during the quarter ended February 28, 2022.

On February 4, 2022, the Company issued 9,025,000 common stock warrants to its officers, contracted consultants and professionals. Each warrant is convertible into 1 share of common stock with an exercise price of $0.0925. The warrants expire on February 4, 2027. Pursuant to the terms of the Common Stock Purchase Warrants, 1/4th of the total number of shares underlying the warrants will vest and become exercisable on the first anniversary of the date of issuance, and an additional l/12th of the total number of remaining shares underlying the warrants will vest and become exercisable on each of the monthly anniversaries thereafter, in each case, so long as the holder continues to be a service provider of the Company. The foregoing vesting schedule is subject to acceleration in the event of the service provider’s death, disability, termination without cause or a change in control of the Company. There was $60,167 of stock-based compensation expense included in general and administrative expenses as of February 28, 2022 and $1,383,833 of unvested stock based compensation which will be recognized through February 28, 2024.

On February 7, 2022, the Company and the purchasers under the Securities Purchase Agreement executed Note Conversion and Warrant Amendment Agreements pursuant to which they amended the common stock purchase warrants issued pursuant to the Securities Purchase Agreement, dated December 10, 2020, to reduce the exercise price per share from $0.10 per share to $0.02 per share for 335,505 warrants. As a result of the warrant modification in conjunction with the note conversion, $16,486 was recorded as a loss on extinguishment of debt for the quarter ended February 28, 2022, which is included in the loss on extinguishment of debt of $72,198 on the Statement of Operations.

A summary of the Company’s outstanding common stock warrants as of February 28, 2022 is as follows:

 SCHEDULE OF COMMON STOCK WARRANTS OUTSTANDING

The following table summarizes information about common stock warrants outstanding at February 28, 2022:

 SCHEDULE OF COMMON STOCK WARRANTS OUTSTANDING AND WARRANT EXERCISABLE

The Company estimates the fair value of each award on the date of grant using a Black Scholes valuation model that uses the following assumptions for warrants earned during the year ended February 28, 2022:

 SCHEDULE OF ASSUMPTION OF BLACK-SCHOLES OPTION PRICING MODEL

NOTE 8: CONTINGENCIES

On August 17, 2018, we entered into employment agreements with Alex Aliksanyan, our former Chief Executive Officer and a director, and Thomas M. Grbelja, our Chief Financial Officer, Secretary and a director.

Pursuant to the employment agreement with Alex Aliksanyan (the “Aliksanyan Employment Agreement”), Mr. Aliksanyan agreed to serve as our Chief Executive Officer, and we agreed to pay Mr. Aliksanyan an annual base salary of $120,000 per year. The initial term of the Aliksanyan Employment Agreement is 12 months and may be extended by mutual agreement between us and Mr. Aliksanyan. On or about August 28, 2018, we entered into an oral agreement with Mr. Aliksanyan, as memorialized by a First Amendment to Employment Agreement dated September 25, 2018, pursuant to which Mr. Aliksanyan agreed to continue receiving his 2017 annual salary of $36,000 per year in exchange for continued employment and our agreement to adopt an employee stock option plan or similar plan for compensating, incentivizing, retaining and attracting employees prior to June 30, 2019, from which Mr. Aliksanyan would be eligible to receive equity securities from time to time in the discretion of our board of directors. On April 17, 2020, we terminated the employment of Alex Aliksanyan as our Chief Executive Officer, effective as of April 20, 2020. On April 20, 2020, we and Mr. Aliksanyan entered into that certain Separation and Release of Claims Agreement, dated April 20, 2020, whereby Mr. Aliksanyan terminated his Employment Agreement, dated August 17, 2018, as amended, and provided a release of claims to us in exchange for a lump sum payment equal to $1,500, representing one month of his base salary.

Pursuant to the employment agreement with Thomas M. Grbelja (the “Grbelja Employment Agreement”), Mr. Grbelja agreed to serve as our Chief Financial Officer, devoting a minimum of 50% of his time and attention to his duties as Chief Financial Officer. We agreed to pay Mr. Grbelja an annual base salary of $70,000 per year. The initial term of the Grbelja Employment Agreement is 12 months and may be extended by mutual agreement between us and Mr. Grbelja. On or about August 28, 2018, we entered into an oral agreement with Mr. Grbelja, as memorialized by a First Amendment to Employment Agreement dated September 25, 2018, pursuant to which Mr. Grbelja agreed to continue receiving his 2017 annual salary of $24,000 per year in exchange for continued employment and our agreement to adopt an employee stock option plan or similar plan for compensating, incentivizing, retaining and attracting employees prior to June 30, 2019, from which Mr. Grbelja would be eligible to receive equity securities from time to time in the discretion of our board of directors.

On February 4, 2022, we entered into a Settlement Agreement with each of Alex Aliksanyan, our Chief Executive Officer and Director, William McLeod, our Secretary and Director, and Thomas Grbelja, our Chief Financial Officer and Director, pursuant to which, among other things, each of the foregoing individuals terminated all effective employment agreements, and released us of any and all claims he may have had against us, including for owed but unpaid compensation, and we agreed to issue to each such individual a new compensation package consisting of restricted common stock and warrants to purchase common stock. Previously held Common Stock Purchase Warrants and Senior Convertible Promissory Notes remain in effect. See Note 7 and 9.

NOTE 9: CONVERTIBLE PROMISSORY NOTES PAYABLE

From December 10, 2020 through January 27, 2021, we entered into a Securities Purchase Agreement, by and among us and the purchasers named thereunder, pursuant to which we issued to each of seven investors a Senior Convertible Promissory Note in the principle amount of up to $10,000 (each, a “Note” and collectively, the “Notes”) and a Common Stock Purchase Warrant to purchase up to 50,000 shares of our common stock at an exercise price of $0.10 per share (each, a “Warrant”, and collectively, the “Warrants”). The investors included Alex Aliksanyan, a Director, Thomas M. Grbelja, our Treasurer, Secretary and a Director and William McLeod, our Chief Executive Officer and Director.

The Notes bear interest at the rate of 10.0% per annum and mature on July 31, 2022. We may agree with the noteholders from time to time to accept loan advances under the Notes up to the principal amount of the Notes. As of the date of this filing, the investors have made aggregate loan advances under the Notes of $47,160, which includes an additional $16,000 that was advanced under the existing agreement on or about June 20, 2021 and an additional $3,601 during September 2021. In January 2022 an additional advance of $20,000 under the existing agreement.

Pursuant to the terms of the Notes, the holders of the Notes have the right, at their option, at any time, to convert the principal amount of the Notes, and any accrued interest, into our common stock at a conversion of $0.07 per share. However, each holder of a Note will not have the right to convert any portion of his Note if the holder (together with his affiliates) would beneficially own in excess of 9.99% of the number of shares of our common stock outstanding immediately after giving effect to the conversion, as such a percentage ownership is determined in accordance with the terms of the Note. Each holder has the right to waive the foregoing conversion limitations, in whole or in part, upon and effective after 61 days prior written notice to us.

On February 7, 2022, the existing noteholders exercised their conversion rights and were issued 679,534 common shares at $0.07 for a total value of $47,567. Three noteholders agreed to a modification where they converted a portion of their notes at $0.035 per share and were issued 628,238 common shares for a total value of $21,988. See Note 6 and Note 7 for additional disclosure.

Two convertible notes have a remaining outstanding balance of $2,000 as of the quarter ended February 28, 2022.

NOTE 10: PAYCHECK PROTECTION PROGRAM/SBA LOAN

In March 2021, the Company obtained an additional Paycheck Protection Program (2) loan and the SBA Economic Development Incentive Loan in the amount of $15,077 from the SBA.

The Company applied for and received forgiveness from the SBA in December 2021 in the amount of $15,077. The Company recorded the gain on forgiveness of this loan as a component of other income.

NOTE 11: SUBSEQUENT EVENTS

During March 2022, the Company received $36,000 in connection with the issuance of 450,000 shares of its common stock at $0.08 effective as of February 28, 2022. $36,000 was recorded as a stock subscription receivable as of the quarter ended February 28, 2022

Our Management’s Discussion and Analysis contains not only statements that are historical facts, but also statements that are forward-looking. Forward-looking statements are, by their very nature, uncertain and risky. These risks and uncertainties include international, national and local general economic and market conditions; demographic changes; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; raw material costs and availability; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers; fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other risks that might be detailed from time to time in our filings with the Securities and Exchange Commission.

Although the forward-looking statements in this Quarterly Report reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by them. Consequently, and because forward-looking statements are inherently subject to risks and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. You are urged to carefully review and consider the various disclosures made by us in this report and in our other reports as we attempt to advise interested parties of the risks and factors that may affect our business, financial condition, and results of operations and prospects

The following discussion and analysis of financial condition and results of operations of the Company is based upon, and should be read in conjunction with, its unaudited financial statements and related notes elsewhere in this Quarterly Report on Form 10-Q, which have been prepared in accordance with accounting principles generally accepted in the United States.

Overview

We were incorporated in the State of Nevada on January 10, 2017 as a wholly owned subsidiary of RealBiz Media Group, Inc., a Delaware corporation (“RealBiz”). On July 31, 2018, RealBiz effectuated our spin-off from RealBiz. Upon completion of the spin-off, RealBiz stockholders owned 100% of the outstanding shares of our common stock.

We are engaged in the business of providing digital media and marketing services for the real estate industry. We currently generate revenue from service fees (video creation and production) and referral fees from our LoseTheAgent.com website. At the core of our programs is our proprietary video creation technology which allows for an automated conversion of data (text, photos and video slices) to a video with voice over and music. We provide video search, storage and marketing capabilities on multiple platform dynamics for web and mobile. Once a home, personal or community video is created using our proprietary technology, it can be published to social media, email or distributed to multiple real estate websites. In addition, we own and operate the web site LoseTheAgent.com, which is a site dedicated to peer-to-peer real estate transactions between home sellers and buyers - the so called For Sale By Owner segment. We currently have approximately 100,000 home listings across all 50 states. We monetize the website by charging fees for both listing a home for sale and picking up possible buyers’ messages of interest. We also plan on generating additional revenues by monetizing seller/buyer data with targeted, interested parties. The web site is fully functional and is being marketed via various online platforms.

Results of Operations for the Three Months Ended February 28, 2022 and February 28, 2021

Revenues

Total revenue for the three months ended February 28, 2022, amounted to $11,456 compared to $15,978 for the three months ended February 28, 2021, a decrease of $4,552 or 28%. The decrease is primarily a result of declining legacy virtual tour business, due primarily to the loss of our top two franchise accounts, who took their video production business in house. We envision these trends continuing for the foreseeable future and see significant risks to the future of our legacy business.

Cost of Revenue

Cost of revenues totaled $3,674 for the three months ended February 28, 2022, compared to $4,313 for the three months ended February 28, 2021, representing a decrease of $639, or 15%. Cost of revenues consists primarily of engineering and server costs incurred in connection with maintenance of our online networks.

Operating Expenses

Our operating expenses, which include marketing and promotion and general and administrative expenses, increased $86,393 to $107,314 for the three months ended February 28, 2022, compared to $20,921 for the three months ended February 28, 2021. Stock based compensation amounted to $69,334 during the current quarter.

General and administrative expenses amounted to $107,282 and $20,842 for the three months ended February 28, 2022 and February 28, 2021, respectively. A breakdown of general and administrative expenses is as follows:

Net Income/Loss

We had net loss of $162,928 for the three months ended February 28, 2022, compared to net loss of $9,256 the three months ended February 28, 2021, an increase of $153,672.

Liquidity and Capital Resources; Anticipated Financing Needs

On February 28, 2022, we had $84,251 cash on-hand, an increase of $64,629 from the beginning of the year balance of $19,622.

Net cash used in operating activities was $22,371 for the three months ended February 28, 2022, an increase of $2,132 from $20,239 of cash used in operations during the three months ended February 28, 2021. This increase was primarily due to a larger operating loss during the current fiscal quarter.

Net cash provided by financing activities was $87,000 for the three months ended February 28, 2022, from issuance of convertible promissory notes payable of $20,000 and proceeds from the issuance of common stock in the amount of $67,000. Net cash provided by financing activities for the quarter ended February 28, 2021, amounted to $27,500

Our ability to continue as a going concern on a long-term basis is dependent upon our ability to generate sufficient cash flow from operations to meet our obligations on a timely basis, to obtain additional financing and ultimately attain profitability.

Based solely on our own internal estimates without the benefit of any independent third-party evaluation, we anticipate that our cash and cash flow will not be sufficient to satisfy our cash requirements over the next twelve months and we will likely require significant external financing. The magnitude of the additional financing and its timing is not yet precisely known. In the event that we are able to secure a sufficient amount of additional financing on a timely basis and on generous terms, it may include the issuance of equity or debt securities, obtaining credit facilities, or entering into other financing arrangements on such terms as then existing market conditions require. In the event that we were to issue additional equity or debt securities, stockholders may experience significant dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. And in the case of any issuance of one or more debt securities, the debt covenants may restrict our operating ability and our ability to raise additional financing from debt. Our ability to obtain additional capital on terms that are reasonable cannot be assured. We may be forced to obtain additional capital on terms that could limit our long-term ability to remain in business or otherwise materially restrict our operations.

Critical Accounting Policies

In December 2001, the SEC requested that all registrants list their most “critical accounting polices” in the Management Discussion and Analysis. The SEC indicated that a “critical accounting policy” is one which is both important to the portrayal of a company’s financial condition and results, and requires management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. We have identified the policies below as critical to our understanding of the results of our business operations. We discuss the impact and any associated risks related to these policies on our business operations throughout Management’s Discussion and Analysis of Financial Condition and Results of Operations where such policies affect our reported and expected financial results.

In the ordinary course of business, we have made a number of estimates and assumptions in preparing our financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Actual results could differ significantly from those estimates and assumptions. The following critical accounting policies are those that are most important to the portrayal of our financial statements. These policies require our most difficult, subjective, and complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. For a summary of our significant accounting policies, including the critical accounting policies discussed below, refer to Note 2 — “Summary of Significant Accounting Policies” included in the “Notes to Financial Statements”,

As a smaller reporting company, we are not required to provide the information required by this Item.

Evaluation of Disclosure Controls and Procedures

We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act. Disclosure controls and procedures include, without limitation, controls and other procedures that are designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on this evaluation, because of the Company’s limited resources and limited number of employees, management concluded that our disclosure controls and procedures were ineffective as of February 28, 2022.

Management has identified control deficiencies regarding the lack of segregation of duties. Management of the Company believes that these material weaknesses are due to the small size of the Company’s accounting staff. The small size of the Company’s accounting staff may prevent adequate controls in the future, such as segregation of duties, due to the cost/benefit of such remediation.

To mitigate the current limited resources and limited employees, we rely heavily on direct management oversight of transactions, along with the use of external legal and accounting professionals. As we grow, we expect to increase our number of employees, which should enable us to implement adequate segregation of duties within the internal control framework.

These control deficiencies could result in a misstatement of account balances that would result in a reasonable possibility that a material misstatement to our financial statements may not be prevented or detected on a timely basis. In light of this material weakness, we performed additional analyses and procedures in order to conclude that our unaudited financial statements for the quarter ended February 28, 2022, included in this Quarterly Report on Form 10-Q were fairly stated in accordance with GAAP. Accordingly, management believes that despite our material weaknesses, our unaudited financial statements for the quarter ended February 28, 2022 are fairly stated, in all material respects, in accordance with GAAP.

Limitations on Effectiveness of Controls and Procedures

Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include, but are not limited to, the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during the transition period or our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

In the ordinary course of business, we may from time to time be involved in various pending or threatened legal actions. The litigation process is inherently uncertain and it is possible that the resolution of such matters might have a material adverse effect upon our financial condition and/or results of operations. However, in the opinion of our management, matters currently pending or threatened against us are not expected to have a material adverse effect on our financial position or results of operations.

As a smaller reporting company, we are not required to provide the information required by this Item.

On February 4, 2022, we issued a total of 1,375,000 shares of restricted common stock to five service providers pursuant to Restricted Stock Award Agreements. Each of Alex Aliksanyan, our Chief Executive Officer and Director, Thomas Grbelja, our Chief Financial Officer and Director, William McLeod, our Secretary and Director, Julio Fernandez, a third-party service provider, and Edward Weaver, a third-party service provider, received an award of 275,000 shares of restricted common stock. The issuances of restricted common stock were exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, and the shareholders were all either accredited or sophisticated investors familiar with our operations.

On February 4, 2022, we issued Common Stock Purchase Warrants to five service providers for the purchase of up to an aggregate of 9,025,000 shares of our common stock. Alex Aliksanyan, our Chief Executive Officer and Director, was issued warrants to purchase up to 2,525,000 shares of our common stock. Thomas Grbelja, our Chief Financial Officer and Director, was issued warrants to purchase up to 1,975,000 shares of our common stock. William McLeod, our Secretary and Director, was issued warrants to purchase up to 575,000 shares of our common stock. We issued to each of Julio Fernandez, a third-party service provider, and Edward Weaver, a third-party service provider, warrants to purchase up to 1,975,000 shares of our common stock. The issuances of the Common Stock Purchase Warrants were exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, and the holders were all either accredited or sophisticated investors familiar with our operations.

On February 7, 2022, we issued a total of 1,307,772 shares of our common stock to eight investors pursuant to Note Conversion and Warrant Amendment Agreements. The investors included Alex Aliksanyan, our Chief Executive Officer and Director, Thomas Grbelja, our Chief Financial Officer and Director, and William McLeod, our Secretary and Director. The issuances of common stock were exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, and the holders were all either accredited or sophisticated investors familiar with our operations.

On February 28, 2022, we issued a total of 1,287,500 shares of our Common Stock to ten investors in exchange for a total of $103,000. In connection with the foregoing, we issued 125,000 of such shares of Common Stock to William McLeod, our Secretary and one of our Directors. The issuances of Common Stock were exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, and the holders were all either accredited or sophisticated investors familiar with our operations.

There is no information required to be disclosed by this Item.

There is no information required to be disclosed by this Item.

On February 3, 2022, OTC Markets Group, Inc. approved our upgrade from the OTC Pink to the OTCQB Venture Market, effective as of February 4, 2022.

* Furnished herewith

SIGNATURES

Pursuant to the requirements 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.