TRAQIQ, INC. Management's Discussion and Analysis of Financial Condition and Results of Operations (form 10-K)

The discussion and analysis of our financial condition and results of operations are based on our financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported revenues and expenses during the reporting periods. On an ongoing basis, we evaluate estimates and judgments, including those described in greater detail below. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

As used in this "Management's Discussion and Analysis of Financial Condition and Results of Operation," except where the context otherwise requires, the term "we," "us," "our," or "the Company," refers to the business of TraQiQ, Inc.

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Overview

The Company currently markets an aerobic digestion technology solution for the disposal of food waste at the point of generation. Its line of Revolution Series Digesters has been described as self-contained, robotic digestive systems that we believe are as easy to install as a standard dishwasher with no special electrical or plumbing requirements. Units range in size depending upon capacity, with the smallest unit approximately the size of a residential washing machine. The digesters utilize a biological process to convert food waste into a liquid that we believe is safe to discharge down an ordinary drain. This process can result in a substantial reduction in costs for customers including cruise lines, restaurants, retail stores, hospitals, hotel/hospitality companies and governmental units by eliminating the transportation and logistics costs associated with food waste disposal. The Company also expects the process reduce the greenhouse gases associated with food-waste transportation and decomposition in landfills that have been linked to climate change. The Company offers its Revolution Series Digesters in several sizes targeting small- to mid-sized food waste generation sites that are often more economical than traditional disposal methods. The Revolution Series Digesters are manufactured and assembled in the United States.

In an effort to expand the capabilities of its digesters, the Company developed a sophisticated Internet of Things ("IoT") technology platform to provide its customers with transparency into their internal and supply chain waste generation and operational practices. This patented process collects weight related data from the digesters to deliver real-time data that provides valuable information that when analyzed, can improve efficiency, and validate corporate sustainability efforts. The Company provides its IoT platform through a SaaS ("Software as a Service") model that is either bundled in its rental agreements or sold through a separate annual software license. The Company continues to add new capacity sizes to its line of Revolution Series Digesters to meet customer needs.

The Company was incorporated in the State of California on September 9, 2009 as Thunderclap Entertainment, Inc. On July 14, 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc.

On March 18, 2022, the Financial Industry Regulatory Authority, approved a reverse 1-for-8 stock split of the Company's common stock (the "Reverse Split"). The Reverse Split was effective on March 21, 2022. The common stock and common stock equivalents and the per-share amounts have been retroactively restated in accordance with ASC 855-10-25 and the loss per share figures have been retroactively restated in accordance with ASC 260-10-55-12.

On December 30, 2022, the Company entered into an Assignment of Stock (the "MTP Agreement") with Mimo Technologies Private Ltd. ("MTP") and Lathika Regunathan ("LR"), pursuant to which the Company sold, assigned and transferred to LR, and LR purchased from the Company, all of the Company's equity interests in MTP in exchange for nominal consideration of $1.00.

On December 30, 2022, the Company entered into an Assignment of Stock (the "TSP Agreement") with TraQiQ Solutions Private Ltd. ("TSP") and LR, pursuant to which the Company sold, assigned and transferred to LR and LR purchased from the Company, all of the Company's equity interests in TSP in exchange for nominal consideration of $1.00.

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On December 30, 2022, the Company entered into an Assignment of Units (the "Rohuma Agreement", and, together with the MTP Agreement and the TSP Agreement, the "Disposition Agreements") with Rohuma LLC ("Rohuma") and Happy Kompany LLC ("Happy") pursuant to which the Company sold, assigned and transferred to Happy, and Happy purchased from the Company, all of the Company's equity interests in Rohuma, in exchange for nominal consideration of $1.00. Pursuant to the Rohuma Agreement, the Company assumed the liabilities of Rohuma with respect to two loans with Paypal/Loanbuilder in an aggregate principal amount of $155,053 plus any accumulated interest and fees.

On January 5, 2023, the Company, consummated the transactions contemplated by the Purchase Agreement among TraQiQ Environmental, Inc. ("REI") and BioHiTech America, LLC ("BHT" and, together with REI, the "Renovare Sellers") and the Company, pursuant to which the Renovare Sellers sold and assigned to the Company, and the Company purchased and assumed from the Renovare Sellers, (a) certain assets related to the business of (i) offering aerobic digestion technology solutions for the disposal of food waste at the point of generation and (ii) data analytics with respect to food waste (collectively, the "Digester Business") and (b) certain specified liabilities of the Renovare Sellers, including, but not limited to, indebtedness in an amount equal to $3,017,090 (the "Michaelson Debt") owed to Michaelson Capital Special Finance Fund II, L.P. ("Michaelson").

In exchange for the assets of the Digester Business, the Company (a) paid the Renovare Sellers an amount equal to $150,000 and (b) issued to REI (i) 1,250,000 shares of the Company's Series B Preferred Stock, par value $0.0001 (the "Series B Preferred Stock"), and (ii) 15,686,926 shares of the Company's common stock, par value $0.0001 (the "Common Stock"), a portion of which is being held in escrow. The Purchase Agreement contained standard representations and warranties by the Company and the Renovare Sellers which, except for fundamental representations, remain in effect for twelve months following the closing date. 1,568,693 shares of the Common Stock portion of the closing consideration were placed into escrow, the release of which is contingent upon a mutual agreement of the parties or January 4, 2024 or if a claim is pending, a final non-appealable order of any court of competent jurisdiction. Additional agreements ancillary to the asset acquisition were also executed, including but not limited to a bill of sale, assignment and assumption agreement, an escrow agreement and a domain name assignment agreement. The Renovare Sellers also agreed that, for a period of five years from closing date, the Sellers would not engage in a business that competes with the Digester Business.

Going Concern

The Company has an accumulated deficit of $17,522,786 and a working capital deficit of $1,616,199 as of December 31, 2022, compared to an accumulated deficit of $8,953,768 and a working capital deficit of $9,844,269 as of December 31, 2021. The Company's continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations, which it has not been able to accomplish to date, and/or obtain additional financing from its stockholders and/or other third parties.

Our consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to meet its obligations and continue its operations for the next fiscal year. The continuation of the Company as a going concern is dependent upon the ability of the Company to obtain necessary equity or debt financing to continue operations, successfully locating and negotiating with other business entities for potential acquisition and /or acquiring new clients to generate revenues. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties. During the year ended December 31, 2022, the Company converted $5.0 million of debt into shares of common and Series B Preferred Stock. Additionally, in the first quarter of 2023, the Company completed an acquisition of Renovare. Overall, management is focused on effectively positioning the Company for a positive increase in cash flows. The Company will continue to closely monitor the cash flows of the Company.

In order to further implement its business plan and satisfy its working capital requirements, the Company will need to raise additional capital. There is no guarantee that the Company will be able to raise additional equity or debt financing at acceptable terms, if at all.

There is no assurance that the Company will ever be profitable. These consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern.

Critical Accounting Policies and Estimates

Our significant accounting policies are more fully described in the notes to our consolidated financial statements. Those material accounting estimates that we believe are the most critical to an investor's understanding of our financial results and condition are discussed immediately below and are particularly important to the portrayal of our financial position and results of operations and require the application of significant judgment by our management to determine the appropriate assumptions to be used in the determination of certain estimates.

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Consolidation

The consolidated financial statements include the accounts of TraQiQ, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

The Company applies the guidance of Topic 810 Consolidation of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") to determine whether and how to consolidate another entity. Pursuant to ASC paragraph 810-10-15-10, all majority-owned subsidiaries-all entities in which a parent has a controlling financial interest-are consolidated except when control does not rest with the parent.

Pursuant to ASC paragraph 810-10-15-8, the usual condition for a controlling financial interest is ownership of a majority voting interest, and, therefore, as a general rule ownership by one reporting entity, directly or indirectly, of more than 50 percent of the outstanding voting shares of another entity is a condition pointing toward consolidation. The power to control may also exist with a lesser percentage of ownership, for example, by contract, lease, agreement with other stockholders, or by court decree.

In accordance with ASC 810-10-45, the Company has deconsolidated the subsidiaries of MTP, Rohuma and TSP as a result of the nonreciprocal transfer (spinoff). The Company has recognized the loss on the spinoff in net loss on the consolidated statements of operations

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. These estimates include, but are not limited to, management's estimate of provisions required for non-collectible accounts receivable, depreciative lives of our assets, determination of technological feasibility, and valuation allowances of our deferred tax assets. Actual results could differ from those estimates.

Capitalized Software Costs

In accordance with the relevant FASB accounting guidance regarding the development of software to be sold, leased, or marketed, the Company expenses such costs as they are incurred until technological feasibility has been established, at and after which time these costs are capitalized until the product is available for general release to customers. Once the technological feasibility is established per ASC 985-20, the Company capitalizes costs associated with the acquisition or development of major software for internal and external use in the balance sheet. Costs incurred to enhance the Company's software products, after general market release of the services using the products, is expensed in the period they are incurred. The Company only capitalizes subsequent additions, modifications or upgrades to internally developed software to the extent that such changes allow the software to perform a task it previously did not perform. The Company expenses software maintenance and training costs as incurred. As of December 31, 2022, there were no capitalized software costs.

Revenue Recognition

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), specifically ASC 606-10-50-12. This standard provides a single set of guidelines for revenue recognition to be used across all industries and requires additional disclosures. The updated guidance introduces a five-step model to achieve its core principal of the entity recognizing revenue to depict the transfer of goods or services to customers at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted the updated guidance effective January 1, 2018 using the full retrospective method, however the new standard did not have a material impact on its consolidated financial position and consolidated results of operations, as it did not change the manner or timing of recognizing revenue.

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Professional Service Revenue

TRAQ Pvt Ltd. generally derived a large part of its revenues from professional and support services, which included revenue generated from software development projects and associated fees for consulting, implementation, training, and project management provided to customers using their systems. Revenue from arrangements with customers was recognized based on the Company's satisfaction of distinct performance obligations identified in each agreement, generally at a point in time as discussed in ASC 606. In instances where multiple performance obligations were identified, the Company allocated the transaction price to each performance obligation based on relative selling prices of each distinct product or service, and recognizes revenue related to each performance obligation at the points in time that each performance obligation is satisfied. The Company's performance obligation included providing customization of software and the selling of licenses, where the Company typically satisfied its performance obligations prior to the submission of invoices to the customer for such services. The Company's performance obligation for consulting and technical support was delivered on as the work was being performed, which was satisfied prior to invoicing. The Company generally collected payment within 30 to 60 days of completion of the performance obligation and there were no agency relationships.

Software development arrangements involving significant customization, modification or production were accounted for in accordance with the appropriate technical accounting guidance issued by the FASB using the percentage-of- completion method. The Company recognized revenue using periodic reported actual hours worked as a percentage of total expected hours required to complete the project arrangement and applied the percentage to the total arrangement fee.

Unbilled revenue represented earnings in excess of billings as at the end of the reporting period. Sales taxes collected from customers and remitted to governmental authorities were accounted for on a net basis and therefore were excluded from revenues in the statements of operations.

TRAQ Pvt Ltd. has deferred the revenue and costs attributable to certain process transition activities with respect to its customers where such activities do not represent the culmination of a separate earnings process. Such revenue and costs were subsequently recognized ratably over the period in which the related services were performed. Further, the deferred costs were limited to the amount of the deferred revenues. As of December 31, 2022, there was no deferred revenue.

Software Solution Revenue

Revenue from arrangements with customers was recognized based on the Company's satisfaction of distinct performance obligations identified in each agreement, generally at a point in time as discussed in ASC 606. In instances where multiple performance obligations are identified, the Company allocated the transaction price to each performance obligation based on relative selling prices of each distinct product or service, and recognized revenue related to each performance obligation at the points in time that each performance obligation was satisfied. The Company's performance obligation included providing connectivity to software, generally through a monthly subscription, where the Company typically satisfied its performance obligations prior to the submission of invoices to the customer for such services. The Company's performance obligation for hardware components that were purchased by the customer in connection with the solution was delivery of the purchased device, which was satisfied prior to invoicing. The Company provided a twelve-month warranty on their hardware. All units deployed by the Company were past the twelve-month period, thus the Company did not accrue for a warranty liability. The Company generally collected payment within 30 to 60 days of completion of the performance obligation and there were no agency relationships.

Revenue From Sales of Goods

Revenue from arrangements with customers was recognized based on the Company's satisfaction of distinct performance obligations identified in each agreement, generally at a point in time as discussed in ASC 606. The performance obligations were satisfied upon shipment of the merchandise being sold.

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Costs of Services Provided

Costs of services provided consisted of data processing costs, customer support costs including personnel costs to maintain the Company's proprietary databases, costs to provide customer call center support, hardware and software expense associated with transaction processing systems and exchanges, telecommunication and computer network expense, and occupancy costs associated with facilities where these functions are performed. Depreciation expense was not included in costs of services provided.

Foreign Currency Transactions

The Company accounts for foreign currency transactions in accordance with ASC 830, "Foreign Currency Matters" ("ASC 830"), specifically the guidance in subsection ASC 830-20, "Foreign Currency Transactions". The U.S. dollar is the functional and reporting currency for the Company and its subsidiaries other than the Indian subsidiaries whose functional currency is the Indian Rupee. Pursuant to ASC 830, monetary assets and liabilities denominated in foreign currencies are translated into U.S. dollars at exchange rates in effect at the balance sheet date, with the resulting gains or losses upon settlement reported in foreign exchange gain (loss) in the computation of net income (loss). Gains or losses resulting from translation adjustments are reported under accumulated other comprehensive income (loss).

Uncertain Tax Positions

The Company follows ASC 740-10, "Accounting for Uncertainty in Income Taxes". This requires recognition and measurement of uncertain income tax positions using a "more-likely-than-not" approach. Management evaluates the Company's tax positions on an annual basis.

The Company files income tax returns in the U.S. federal tax jurisdiction and various state and foreign tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed. Foreign income tax returns are subject to examination by foreign taxing authorities.

Fair Value of Financial Instruments

ASC 825, "Financial Instruments," requires the Company to disclose estimated fair values for its financial instruments. Fair value estimates, methods, and assumptions are set forth below for the Company's financial instruments: The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses, stockholder advances, and short-term financing approximate fair value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.

Earnings (Loss) Per Share of Common Stock

Basic net income (loss) per common share is computed using the weighted average number of common shares outstanding. Diluted earnings per share (EPS) include additional dilution from common stock equivalents, such as convertible notes, preferred stock, stock issuable pursuant to the exercise of stock options and warrants. Common stock equivalents are not included in the computation of diluted earnings per share when the Company reports a loss because to do so would be anti-dilutive for periods presented. An uncertain number of shares underlying convertible debt have been excluded from the computation of loss per share because their impact was anti-dilutive.

Related Party Transactions

Parties are considered to be related to the Company if the parties directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal stockholders of the Company, its management, members of the immediate families of principal stockholders of the Company and its management and other parties with which the Company may deal where one-party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions shall be recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as compensation or distribution to related parties depending on the transaction.

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Lease Obligations

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use ("ROU") assets, current portion of operating lease liabilities and operating lease liabilities, less current portion in the Company's consolidated balance sheets.

ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately. There is no lease obligation as of December 31, 2022.

Results of Operations and Financial Condition for the Year Ended December 31, 2022 as Compared to the Year Ended December 31, 2021

Revenues

For the year ended December 31, 2022 compared to December 31, 2021, the Company's revenues increased by $1,582, or 100%, from $0 in 2021 to $1,582 in 2022. As a result of operations being discontinued, a majority of revenue has been reclassified to discontinued operations, leaving a small amount or revenue remaining on the statements of operations relating to continuing operations.

Cost of Revenues

For the year ended December 31, 2022 compared to December 31, 2021, the Company's cost of revenues increased by $54,209, or 100%, from $0 in 2021 to $54,209 in 2022. As a result of operations being discontinued, a majority of cost of revenues has been reclassified to discontinued operations, leaving a small amount of revenue remaining on the statements of operations relating to continuing operations.

Operating Expenses

For the year ended December 31, 2022 compared to December 31, 2021, the Company's salary and salary-related costs decreased by $1,086,226, or 85%, from $1,279,860 in 2021 to $193,634 in 2022. The decrease is the result of scaling down operations in 2022, and inevitably the dispositions of Rohuma, TSP and Mimo during the year ended December 31, 2022.

During the year ended December 31, 2022 compared to December 31, 2021, the Company's professional fees decreased by $335,680, or 48%, from $694,787 in 2021 to $359,107 in 2022. Our professional fees decreased due to the acquisitions of Rohuma and Mimo as well as fees related to the acquisitions of those companies in 2021, and due to public offering expenses in 2021.

For the year ended December 31, 2022 compared to December 31, 2021, the Company's rent expense slightly decreased by $50, or 2%, from $2,184 in 2021 to $2,134 in 2022.

For the years ended December 31, 2022 and 2021, the Company's depreciation and amortization expense was $33,240.

For the year ended December 31, 2022 compared to December 31, 2021, the Company's general and administrative expenses decreased by $1,706,278, or 69%, from $2,458,206 in 2021 to $751,928 in 2022 primarily due to the cutbacks in travel and stock based compensation expenses.

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Interest Expense, net of interest income

For the year ended December 31, 2022 compared to December 31, 2021, the Company's interest expense increased by $639,483, or 50%, from $1,266,777 in 2021 to $1,906,260 in 2022 due to higher levels of debt in 2022.

Derivative Liabilities

For the year ended December 31, 2022 compared to December 31, 2021, the Company's change in the fair value of the derivative liability and derivative expense decreased by $221,797, from $1,077,387 in 2021 to $855,590 in 2022 due to the convertible promissory notes and related warrants being classified as derivative liabilities and the changes in the share price over the year ended December 31, 2022 compared to the year ended December 31, 2021. In addition the Company recognized a gain on extinguishment of derivative liabilities of $0 in 2022 versus $1,089,675 in 2021.

Forgiveness of Debt and Other Income

For the year ended December 31, 2022 compared to December 31, 2021, the Company's forgiveness of debt and other income increased by $1,742,606 or 17,301%, from $10,072 in 2021 to $1,752,678 in 2022 due to the forgiveness of accrued interest on notes payable upon conversion of debt.

Loss from discontinued operations

For the year ended December 31, 2022 compared to December 31, 2021, the Company's loss from discontinued operations, after taxes increased by $6,137,455, from $632,258 in 2021 to $6,769,713 in 2022 primarily due to the loss from disposal of subsidiaries of $5,804,121.

Net Loss

For the year ended December 31, 2022 compared to December 31, 2021, the Company's net loss increased by $2,718,193, from $6,453,363 in 2021 to $9,171,556 in 2022 due to the changes noted herein.

Liquidity and Capital Resources

Working Capital

As of December 31, 2022, current assets were $66,460 and current liabilities outstanding were $1,682,659, which resulted in a working capital deficit of $1,616,199. As of December 31, 2021, current assets were $980,747 and current liabilities outstanding were $10,825,016, which resulted in a working capital deficit of $9,844,269.

We believe that our available cash balance as of the date of this filing will not be sufficient to fund our anticipated level of operations for at least the next 12 months. Management believes that our ability to continue our operations depends on our ability to sustain and grow revenue and results of operations as well as our ability to access capital markets when necessary to accomplish our strategic objectives. Management believes that we will continue to incur losses for the immediate future. For the year ended December 31, 2022, we incurred negative cash flow from operations. We expect to finance our cash needs from the results of operations and, depending on results of operations, we may need additional equity or debt financing until we can achieve profitability and positive cash flows from operating activities, if ever.

On or prior to March 31, 2024, we have obligations relating to the payment of indebtedness on term loans and notes payable of $3,652,890 and $1,350,037, respectively. We anticipate meeting our cash obligations on our indebtedness that is payable on or prior to March 31, 2024 from the results of operations and, depending on results of operations, we will likely need additional equity or debt financing.

Our future capital requirements for our operations will depend on many factors, including the profitability of our businesses, the number of and cash requirements of other acquisition candidates that we pursue, and the costs of our operations. Our management has taken several actions to ensure that we will have sufficient liquidity to meet our obligations through March 31, 2024, including the sale of certain of our businesses. We also are evaluating other measures to further improve our liquidity, including, the sale of equity or debt securities and entering into joint ventures with third parties. Lastly, we may elect to reduce certain related-party and third-party debt by converting such debt into preferred or common shares. Our management believes that these actions will enable us to meet our liquidity requirements through March 31, 2024. There is no assurance that we will be successful in any capital-raising efforts that we may undertake to fund operations during 2023.

We plan to generate positive cash flow from our operation; however, to execute our business plan, service our existing indebtedness and implement our business strategy, we will need to obtain additional financing from time to time and may choose to raise additional funds through public or private equity or debt financings, a bank line of credit, borrowings from affiliates or other arrangements. We cannot be sure that any additional funding, if needed, will be available on terms favorable to us or at all. Furthermore, any additional capital raised through the sale of equity or equity-linked securities may dilute our current stockholders' ownership in us and could also result in a decrease in the market price of our common stock. The terms of any securities issued by us in future capital transactions may be more favorable to new investors and may include the issuance of warrants or other derivative securities, which may have a further dilutive effect. We also may be required to recognize non-cash expenses in connection with certain securities we issue, such as convertible notes and warrants, which may adversely impact our financial condition. Furthermore, any debt financing, if available, may subject us to restrictive covenants and significant interest costs. There can be no assurance that we will be able to raise additional capital, when needed, to continue operations in their current form.

Sources and Uses of Cash

Net cash used in operating activities was $1,464,960 for the year ended December 31, 2022 compared to $3,163,103 in 2021. Cash used in operating activities for 2022 and 2021 was primarily related to the loss in operations offset by a loss on the disposal of subsidiaries, increases and decreases in accounts payable and accrued expenses and the changes in accounts receivable due to the lack of adequate cash flow of the Company as well as non-cash charges related to stock-based compensation, the change in the fair value of the derivative liabilities, gains and losses on extinguishment and settlement of debt and the amortization of discounts related to our debt instruments.

Net cash (used in) provided by investing activities was $(33,257) for the year ended December 31, 2022 compared to $20,941 in the year ended December 31, 2021. Cash provided by (used in) investing activities for 2022 and 2021, related to fixed asset additions in 2022 compared to cash paid for acquisitions of $21,825 and cash received in acquisitions of companies of $48,789 as well as acquisitions of fixed assets of $6,023 in 2021.

Net cash provided by financing activities for the year ended December 31, 2022 consisted of proceeds from the issuance of notes of $1,667,975. The Company repaid $388,945 in notes payable during the year ended December 31, 2022. Net cash provided by financing activities for the year ended December 31, 2021 consisted of proceeds from the issuance of common stock and warrants of $494,545 and convertible notes of $1,715,000, along with proceeds received from related party notes of $2,986,125 and $50,331 in proceeds from issuance of long-term debt. The Company repaid $1,292,397 in related party notes, $515,615 in convertible notes and $214,242 in long-term debt during the year ended December 31, 2021.

Outstanding Indebtedness

On January 5, 2023, the Company entered into a 11% OID Senior Secured Promissory Note with Evergreen Capital Management, LLC ("Evergreen") in the amount of $480,000 (includes $80,000 of Original Issue Discount). Evergreen has a maturity of twelve months to December 30, 2023. It accrues interest at a rate of 10% per year. The conversion price Subject to the adjustments described herein, the conversion price (the "Conversion Price") shall be equal the lesser of $0.015 or 90% of average of the two lowest VWAPs for the five consecutive trading days ending on the trading day that is immediately preceding the delivery of a notice of conversion.

On January 5, 2023, the Company, consummated the transactions contemplated by the Purchase Agreement among TraQiQ Environmental, Inc. ("REI") and BioHiTech America, LLC ("BHT" and, together with REI, the "Renovare Sellers") and the Company, pursuant to which the Renovare Sellers sold and assigned to the Company, and the Company purchased and assumed from the Renovare Sellers, (a) certain assets related to the business of (i) offering aerobic digestion technology solutions for the disposal of food waste at the point of generation and (ii) data analytics with respect to food waste (collectively, the "Digester Business") and (b) certain specified liabilities of the Renovare Sellers, including, but not limited to, indebtedness in an amount equal to $3,017,090 (the "Michaelson Debt") owed to Michaelson Capital Special Finance Fund II, L.P. ("Michaelson").

On January 4, 2023, the Company borrowed cash in exchange for a 20% OID Senior Secured Promissory Note dated January 4, 2023 in the original principal amount of $180,000 (the "OID Note"). The OID Note matures on January 4, 2024, bears interest at the rate of ten percent (10%) per annum and has no prepayment penalty. In the event of a default by the Company under the OID Note, the outstanding principal and interest will be convertible by the holder into Common Stock at a conversion price equal to the lower of (i) $.015 per share and (ii) an amount equal to 90% of the average of the two lowest volume weighted average prices of the Common Stock for the five consecutive trading days prior to the conversion date.

On October 21, 2022, the Company entered into a 20% OID Senior Secured Promissory Note with Evergreen Capital Management, LLC (the "Evergreen Note") in the amount of $48,000 (includes $8,000 of Original Issue Discount). The Evergreen Note has a maturity of twelve months to July 21, 2023. It accrues interest at a rate of 10% per year. The conversion price (the "Conversion Price") is 75% of the price per share at which the common stock of the Company is sold to the public in a qualified offering. There are certain price protections, which make the conversion option a derivative liability.

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On July 5, 2022, the Company entered into a 11% OID Senior Secured Promissory Note with GS Capital Partners LLC (the "GS Capital") in the amount of $144,000 (includes $14,000 of Original Issue Discount). The GS Capital note has a maturity of twelve months and accrues interest at a rate of 12% per year. The conversion price is equal to 86% of the lowest trading price of the Company's common stock for the 12 trading days immediately preceding the delivery of a notice of conversion. In accordance with the terms of the note, the Company issued 3,000 shares of common stock as a commitment fee.

On January 19, 2021, the Company issued a 12% Convertible Promissory Note to GS Capital Partners, LLC (the "GS Note") in the principal amount of $125,000. The GS Note has a maturity date of one-year from issuance and is to be repaid commencing on the fifth monthly anniversary and every month thereafter in the amount of $20,000. In the event of a payment default, the GS Note will be convertible into common stock at a conversion price of 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 3,250 shares of common stock as a commitment fee and issued 21,250 shares of common stock that are returnable upon the Company repaying the GS Note in accordance with its terms. This note was paid off in 2021.

On February 12, 2021, the Company issued a 10% Convertible Promissory Note to Platinum Point Capital, LLC (the "Platinum Note") in the principal amount of $400,000. The Platinum Note has a maturity date of one-year from issuance. The Platinum Note is convertible into common stock a conversion price of the greater of (a) $0.08 or (b) 70% of the lowest traded stock price over the previous 15 trading days, provided that the conversion price will not exceed $8.00. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 25,000 warrants to purchase shares of common stock that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 7,500 shares of common stock as a commitment fee. This note was repaid/ converted into shares of common stock in 2021.

Off-Balance Sheet Arrangements

We have no off-balance sheet financing arrangements.

Contractual Obligations

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

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