ITEM
1. FINANCIAL STATEMENTS
BITECH
TECHNOLOGIES CORPORATION
CONDENSED
CONSOLIDATED BALANCE SHEETS
The
accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
BITECH
TECHNOLOGIES CORPORATION
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
The
accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
BITECH
TECHNOLOGIES CORPORATION
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
The
accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
BITECH
TECHNOLOGIES CORPORATION
CONDENSED
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(UNAUDITED)
As of March 31, 2022
No
dividends were paid for the three months ended March 31, 2022 and 2021.
The
accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
BITECH
TECHNOLOGIES CORPORATION
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE
1. DESCRIPTION OF BUSINESS
Bitech
Technologies Corporation (formerly, Spine Injury Solutions Inc.) (the “Company”, “we” or “us”) was
incorporated under the laws of Delaware on March 4, 1998. In connection with the Company’s planned expansion of its business following
the completion of the acquisition of Bitech Mining Corporation, a Wyoming corporation (“Bitech Mining”), it filed a Certificate
of Amendment to its Certificate of Incorporation, as amended (the “Certificate of Amendment”) with the Secretary of State
of the State of Delaware on April 29, 2022 to change its corporate name to Bitech Technologies Corporation.
We
are a development-stage technology company dedicated to providing a suite of green energy solutions which we call the Evirontek Integrated
Platform with a focus on cryptocurrency mining, data centers, commercial and residential utility, electric vehicle, and other renewable
energy initiatives. We seek to offer our Evirontek Integrated Platform to resolve the exorbitantly high cost of electricity in crypto
mining and related industries. Our initial core technology is Tesdison; a revolutionary U.S. patented self-charging dual-battery system
technology providing increased efficiency in power generation. We plan to seek business partnerships with renewable energy providers
for various applications and engage with value-added resellers to facilitate and implement our scalable and modular system solution.
The
Company acquired Bitech Mining on March 31, 2022 (the “Closing Date”) through a share exchange pursuant to a Share Exchange
Agreement (the “Share Exchange Agreement”) by and among the Company, Bitech Mining, each of Bitech Mining’s shareholders
(each, a “Seller” and collectively, the “Sellers”), and Benjamin Tran, solely in his capacity as Sellers’
Representative (“Sellers’ Representative”). The transaction contemplated by the Share Exchange Agreement is hereinafter
referred to as the “Share Exchange”). The Share Exchange Agreement provides that the Company will acquire from the Sellers,
an aggregate of 94,312,250 shares of Bitech Mining’s Common Stock, par value $0.001 per share, representing 100% of the issued
and outstanding shares of Bitech Mining (collectively, the “Bitech Mining Shares”). In consideration of the Bitech Mining
Shares, the Company issued to the Sellers an aggregate of 9,000,000 shares of the Company’s newly authorized Series A Convertible
Preferred Stock, par value $0.001 per share (the “Series A Preferred Stock”). Each Bitech Mining Share shall be entitled
to receive 0.09543 shares of Series A Preferred Stock. Each share of Series A Preferred Stock shall automatically convert into 53.975685
shares (an aggregate of approximately 485,781,300) of the Company’s Common Stock (the “Company Common Stock”) upon
filing of an amendment to its Certificate of Incorporation increasing the number of the Company’s authorized common stock so that
there are a sufficient number of shares of Company Common Stock authorized but unissued to permit a full conversion of all the Series
A Preferred Stock. Upon conversion of the Series A Preferred Stock, the Sellers were expected to hold, in the aggregate, approximately
96% of the issued and outstanding shares of Company capital stock on a fully diluted basis.
The
Share Exchange was treated as a recapitalization and reverse acquisition for financial reporting purposes, and Bitech Mining is considered
the acquirer for accounting purposes. As a result of the Share Exchange and the change in our business and operations, a discussion of
the past financial results of our predecessor, Spine Injury Solutions Inc., is not pertinent, and under applicable accounting principles,
the historical financial results of Bitech Mining, the accounting acquirer, prior to the Share Exchange are considered our historical
financial results.
Prior
to March 31, 2022, we were engaged in the business of owning, developing and leasing the Quad Video Halo video recording system (“QVH”)
used to record medical procedures including the collection of accounts receivables related to previously provided spine injury diagnostic
services (collectively, the “QVH Business”).
BITECH
TECHNOLOGIES CORPORATION
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE
2. CRITICAL ACCOUNTING POLICIES
The
following are summarized accounting policies considered to be critical by our management:
Basis
of Presentation
The
accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities
and Exchange Commission (the “SEC”). Certain information and footnote disclosures, normally included in consolidated financial
statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”)
have been condensed or omitted pursuant to such SEC rules and regulations. Nevertheless, we believe that the disclosures are adequate
to make the information presented not misleading. These interim condensed consolidated financial statements should be read in conjunction
with the audited consolidated financial statements and notes thereto included in our 2021 Annual Report as filed on Form 10-K. In the
opinion of management, all adjustments, including normal recurring adjustments necessary to present fairly our financial position with
respect to the interim condensed consolidated financial statements and the results of its operations for the interim period ended March
31, 2022, have been included. The results of operations for interim periods are not necessarily indicative of the results for a full
year.
Revenue
recognition
The
Company adopted Accounting Standards Codification (“ASC”) 606. ASC 606, Revenue from Contracts with Customers, establishes
principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s
contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer
of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange
for those goods or services recognized as performance obligations are satisfied.
The
Company has assessed the impact of the guidance by performing the following five steps analysis:
Step
1: Identify the contract
Step
2: Identify the performance obligations
Step
3: Determine the transaction price
Step
4: Allocate the transaction price
Step
5: Recognize revenue
Substantially
all of the Company’s revenue is derived from leasing equipment. The Company considers a signed lease agreement to be a contract
with a customer. Contracts with customers are considered to be short-term when the time between signed agreements and satisfaction of
the performance obligations is equal to or less than one year, and virtually all of the Company’s contracts are short-term. The
Company recognizes revenue when services are provided to customers in an amount that reflects the consideration to which the Company
expects to be entitled in exchange for those services. The Company typically satisfies its performance obligations in contracts with
customers upon delivery of the services. The Company does not have any contract assets since the Company has an unconditional right to
consideration when the Company has satisfied its performance obligation and payment from customers is not contingent on a future event.
Generally, payment is due from customers immediately at the invoice date, and the contracts do not have significant financing components
nor variable consideration. There are no returns and there is no allowances. All of the Company’s contracts have a single performance
obligation satisfied at a point in time and the transaction price is stated in the contract, usually as a price per unit. All estimates
are based on the Company’s historical experience, complete satisfaction of the performance obligation, and the Company’s
best judgment at the time the estimate is made.
BITECH
TECHNOLOGIES CORPORATION
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Fair
Value of Financial Instruments
Cash,
accounts receivable, accounts payable, accrued liabilities and notes payable as reflected in the consolidated financial statements, approximates
fair value. Fair value estimates are made at a specific point in time, based on relevant market information and information about the
financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore
cannot be determined with precision. Changes in assumptions could significantly affect the estimates.
Cash
and Cash Equivalents
Cash
and cash equivalents consist of liquid investments with original maturities of three months or less. Cash equivalents are stated at cost,
which approximates fair value. We maintain cash and cash equivalents in banks which at times may exceed federally insured limits. We
have not experienced any losses on these deposits.
Property
and Equipment
Property
and equipment are carried at cost. When retired or otherwise disposed of, the related carrying cost and accumulated depreciation are
removed from the respective accounts, and the net difference, less any amount realized from the disposition, is recorded in operations.
Maintenance and repairs are charged to operating expenses as incurred. Costs of significant improvements and renewals are capitalized.
Property
and equipment consist of computers and equipment and are depreciated over their estimated useful lives of three years, using the straight-line
method.
Long-Lived
Assets
We
periodically review and evaluate long-lived assets when events and circumstances indicate that the carrying amount of these assets may
not be recoverable. In performing our review for recoverability, we estimate the future cash flows expected to result from the use of
such assets and its eventual disposition. If the sum of the expected undiscounted future operating cash flows is less than the carrying
amount of the related assets, an impairment loss is recognized in the consolidated statements of operations. Measurement of the impairment
loss is based on the excess of the carrying amount of such assets over the fair value calculated using discounted expected future cash
flows.
Concentrations
of Credit Risk
Assets that expose us to credit risk consist primarily of cash and accounts
receivable. Our accounts receivable arise from a diversified customer base and, therefore, we believe the concentration of credit risk
is minimal. We evaluate the creditworthiness of customers before any services are provided. We record a discount based on the nature of
our business, collection trends, and an assessment of our ability to fully realize amounts billed for services. We have no accounts receivable
to warrant any allowance at March 31, 2022 or December 31, 2021.
BITECH
TECHNOLOGIES CORPORATION
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Stock
Based Compensation
We
account for the measurement and recognition of compensation expense for all share-based payment awards made to employees and directors,
including employee stock options, based on estimated fair values. Under authoritative guidance issued by the Financial Accounting Standards
Board (“FASB”), companies are required to estimate the fair value or calculated value of share-based payment awards on the
date of grant using an option-pricing model. The value of awards that are ultimately expected to vest is recognized as expense over the
requisite service periods in our consolidated statements of operations. We use the Black-Scholes Option Pricing Model to determine the
fair-value of stock-based awards. During the three months ended March 31, 2022 and 2021, we did not recognize any compensation expense during those periods.
Income
Taxes
We
account for income taxes in accordance with the liability method. Under the liability method, deferred assets and liabilities are recognized
based upon anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and
liabilities and their respective tax basis. We establish a valuation allowance to the extent that it is more likely than not that deferred
tax assets will not be utilized against future taxable income.
Uncertain
Tax Positions
Accounting
Standards Codification “ASC” Topic 740-10-25 defines the minimum threshold a tax position is required to meet before being
recognized in the financial statements as “more likely than not” (i.e., a likelihood of occurrence greater than fifty percent).
Under ASC Topic 740-10-25, the recognition threshold is met when an entity concludes that a tax position, based solely on its technical
merits, is more likely than not to be sustained upon examination by the relevant taxing authority. Those tax positions failing to qualify
for initial recognition are recognized in the first interim period in which they meet the more likely than not standard or are resolved
through negotiation or litigation with the taxing authority, or upon expiration of the statute of limitations. De-recognition of a tax
position that was previously recognized occurs when an entity subsequently determines that a tax position no longer meets the more likely
than not threshold of being sustained.
We
are subject to ongoing tax exposures, examinations and assessments in various jurisdictions. Accordingly, we may incur additional tax
expense based upon the outcomes of such matters. When applicable, we will adjust tax expense to reflect our ongoing assessments of such
matters which require judgment and can materially increase or decrease our effective rate as well as impact operating results.
Under
ASC Topic 740-10-25, only the portion of the liability that is expected to be paid within one year is classified as a current liability.
As a result, liabilities expected to be resolved without the payment of cash (e.g. resolution due to the expiration of the statute of
limitations) or are not expected to be paid within one year are not classified as current. Estimated interest and penalties are recognized
as income tax expense and tax credits as a reduction in income tax expense. For the year ended December 31, 2021, we recognized no estimated interest
or penalties as income tax expense.
Legal
Costs and Contingencies
In
the normal course of business, we incur costs to hire and retain external legal counsel to advise us on regulatory, litigation and other
matters. We expense these costs as the related services are received.
If
a loss is considered probable and the amount can be reasonably estimated, we recognize an expense for the estimated loss. If we have
the potential to recover a portion of the estimated loss from a third party, we make a separate assessment of recoverability and reduce
the estimated loss if recovery is also deemed probable.
BITECH
TECHNOLOGIES CORPORATION
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Net
Loss per Share
Basic
and diluted net loss per common share is presented in accordance with ASC Topic 260, “Earnings per Share,” for all periods
presented. During the three months ended March 31, 2022 and 2021, common stock equivalents from outstanding stock options and warrants have been
excluded from the calculation of the diluted loss per share in the consolidated statements of operations, because all such securities
were anti-dilutive. The net loss per share is calculated by dividing the net loss by the weighted average number of shares outstanding
during the periods.
Recent
Accounting Pronouncements Not Yet Adopted
In
June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on
Financial Instruments. ASU No. 2016-13 eliminates the probable initial recognition threshold in current generally accepted accounting
principles (“GAAP”) and, instead, requires the measurement of all expected credit losses for financial assets held at the
reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. In addition, ASU No. 2016-13
amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration.
In November 2019, the FASB issued ASU No. 2019-10 to amend the effective date for entities that had not yet adopted ASU No. 2016-13.
Accordingly, the provisions of ASU No. 2016-13 are effective for annual periods beginning after December 15, 2022, with early application
permitted in annual periods beginning after December 15, 2018. The amendments of ASU No. 2016-13 should be applied through a cumulative-effect
adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. Management is currently
evaluating the future impact of ASU No. 2016-13 on the Company’s consolidated financial position, results of operations and disclosures.
NOTE
3. STOCKHOLDERS’ EQUITY
The total number of authorized shares of our common stock was 250,000,000
shares at March 31, 2022.
On
January 19, 2021, our stockholders approved the filing of an amendment to our certificate of incorporation authorizing 10,000,000 shares
of preferred stock with a par value of $0.001 per share. Such amendment was filed on January 20, 2021.
BITECH
TECHNOLOGIES CORPORATION
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On
March 30, 2022, the Secretary of State of Delaware acknowledged the Company’s filing of a Certificate of Designations of Preferences
and Rights of Series A Convertible Preferred Stock (the “Certificate of Designations”) with the Delaware Secretary of State
creating a series of 9,000,000 shares of Series A Preferred Stock (the “Series A Preferred Stock”) to be issued in connection
with the Share Exchange. The Certificate of Designations include:
|
● |
the
stated value of each share is $1.00 (the “Stated Value”), |
|
|
|
|
● |
each
share has 53.9757 votes per share on any matter, event or action submitted to the holders of our common stock for a vote or on which
the holders of our common stock have a right to vote, |
|
|
|
|
● |
each
share is automatically convertible into shares of our common stock determined by dividing (i) the Stated Value by (ii) the Conversion
Price then in effect. Initially, the “Conversion Price” is $0.018526887 per share, subject to adjustment as described
below on the first business day immediately following the earlier of (a) the date on which the Secretary of State of Delaware shall
have filed the Certificate of Designations; and (b) the date on which FINRA has affected a reverse stock split of the Company’s
outstanding common stock, after all required approvals by the Company’s board of directors and its stockholders, in either
(a) or (b), so that there are a sufficient number of shares of the Company’s Common Stock authorized but unissued to permit
a full conversion of all the Series A Preferred Stock based upon the Conversion Price, |
|
|
|
|
● |
the
conversion price of the Series A Preferred Stock is subject to proportional adjustment in the event of stock splits, stock dividends
and similar corporate events, and |
|
|
|
|
● |
upon
any liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary (a “Liquidation”), each holder
of the Series A Preferred Stock shall be entitled to receive out of the assets, whether capital or surplus, of the Company an amount
equal to the Stated Value, plus any other fees or liquidated damages then due and owing thereon under the Certificate of Designations,
for each share of Series A Preferred Stock before any distribution or payment shall be made to the holders of any junior securities
(as hereinafter defined), and if the assets of the Company shall be insufficient to pay in full such amounts, then the entire assets
to be distributed to each holder of the Series A Preferred Stock shall be ratably distributed among each such holder in accordance
with the respective amounts that would be payable on such shares if all amounts payable thereon were paid in full. |
On
March 31, 2022, we issued 9,000,000 shares of Series A Preferred Stock in exchange for 94,312,250
shares of Bitech Mining’s Common Stock, par value $0.001 per share, representing 100% of the issued and outstanding shares of Bitech
Mining.
NOTE
4. ACQUISITION OF BITECH MINING
On
March 31, 2022, the Company acquired 94,312,250
shares of Bitech Mining’s Common Stock in exchange for 9,000,000
shares of its Series A Preferred Stock representing 100%
of the issued and outstanding shares of Bitech Mining.
The Share Exchange was treated as a recapitalization and reverse acquisition
for financial reporting purposes, and Bitech Mining is considered the acquirer for accounting purposes. As a result of the Share Exchange
and the change in our business and operations, a discussion of the past financial results of our predecessor, Spine Injury Solutions Inc.,
is not pertinent, and under applicable accounting principles, the historical financial results of Bitech Mining, the accounting acquirer,
prior to the Share Exchange are considered our historical financial results.
The
Combination of the Company and Bitech Mining is considered a business acquisition and the method used to present the transaction is the
acquisition method. The acquisition method is a method of accounting for a merger of two businesses. The tangible assets and liabilities
and operations of the acquired business were combined at their market value of the acquisition date, which is the date when the acquirer
gains control over the acquired company
The
following table summarizes the consideration paid for Bitech Mining and the fair value amounts of assets acquired and liabilities assumed
recognized at the acquisition date:
SCHEDULE
OF FAIR VALUE OF ASSETS AND LIABILITIES
| |
| | |
Purchase price | |
$ | 1,113,679 | |
| |
| | |
Cash | |
$ | 1,150,163 | |
Total assets: | |
$ | 1,185,163 | |
Less: liabilities assumed | |
$ | (71,484 | ) |
Net assets acquired | |
$ | 1,113,679 | |
Purchase price in excess of net assets acquired | |
$ | 0 | |
BITECH
TECHNOLOGIES CORPORATION
NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE
5. RELATED PARTY TRANSACTIONS
Up
until March 31, 2022, the Company maintained its executive offices at 5151 Mitchelldale A2, Houston, Texas 77092. This office space encompasses
approximately 200 square
feet and was provided to us at the rental rate of $1,000
per month under a month-to-month agreement with
Northshore Orthopedics, Assoc. (“NSO”), a company owned by William Donovan, M.D., our former director and Chief Executive
Officer. The rent included the use of the telephone system, computer server, and copy machines. We discontinued paying rent in December
2021 due to a lack of funds, and since then NSO has provided the Company this office space rent free.
NOTE
6. SUBSEQUENT EVENTS
On
April 14, 2022, the Company issued 3,348,000 shares of its restricted Common Stock to an individual as compensation for future services
at a fair value price on the date of issuance of $0.10 per share. 1,802,769 shares vest on April 13, 2023 and 515,077 shares vest on
April 13, 2024, April 13, 2025, and April 13, 2026 so long as the individual is providing services to the Company or one of its subsidiaries.
On
April 19, 2022, the Company issued 4,635,720 shares of its restricted Common Stock to an individual as compensation for future services
at a fair value price on the date of issuance of $0.10 per share. The shares vest 25% on each April 18 commencing on April 18, 2023 so
long as the individual is providing services to the Company or one of its subsidiaries.
Effective
as of July 8, 2022, the Financial Industry Regulatory Authority, Inc. (“FINRA”) confirmed that it had received the necessary
documentation to process the Company’s request to change its name and trading symbol previously disclosed in its Form 8-K filed
with the Securities and Exchange Commission on May 2, 2022. The Company’s ticker symbol on the OTCQB tier of the OTC Markets Group.
Inc. was changed to “BTTC” on July 8, 2022.
ITEM
2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This management
discussion and analysis (“MD&A”) of the financial condition and results of operations of Bitech Technologies Corporation
(the “Company,” “Bitech Technologies,” “our” or “we”) is for the three months ended March
31, 2022 and 2021 and for period January 21, 2022 (inception) through December 31, 2021. It is supplemental to, and should be read in
conjunction with, our condensed consolidated financial statements for the three months ended March 31, 2022 and 2021 and our financial
statements for the period January 21, 2021 (inception) through December 31, 2021 and the accompanying notes for such period included in
our Current Report on Form 8-K filed with the Securities and Exchange Commission, or SEC, on April 4, 2022. Our financial statements are
prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Financial information
presented in this MD&A is presented in United States dollars (“$” or “US$”), unless otherwise indicated.
The information
about us provided in this MD&A, including information incorporated by reference, may contain “forward-looking statements”
and certain “forward-looking information” as defined under applicable United States securities laws and Canadian securities
laws. All statements, other than statements of historical fact, made by us that address activities, events or developments that we expect
or anticipate will or may occur in the future are forward-looking statements, including, but not limited to, statements preceded by, followed
by or that include words such as “may”, “will”, “would”, “could”, “should”,
“believes”, “estimates”, “projects”, “potential”, “expects”, “plans”,
“intends”, “anticipates”, “targeted”, “continues”, “forecasts”, “designed”,
“goal”, or the negative of those words or other similar or comparable words and includes, among others, information regarding:
our ability to become profitable and generate cash in our operating activities; our need for substantial additional financing to operate
our business and difficulties we may face acquiring additional financing on terms acceptable to us or at all; our significant indebtedness
and significant restrictions on our operations; our ability to develop and manufacture each of the components of our planned Evirontek
Integrated Platform; the impact of global climate change on our ability to conduct future operations; our dependence on key inputs, suppliers
and skilled labor for the production of each of the components of the Evirontek Integrated Platform; our ability to attract and retain
key personnel; growth-related risks, including capacity constraints and pressure on our internal systems and controls; risk related to
the protection of our intellectual property and our exposure to infringement or misappropriation claims by third parties; risks related
to competition; risks related to our lack of internal controls over financial reporting and their effectiveness; increased costs we are
subject to as a result of being a public company in the United States; and other events or conditions that may occur in the future.
Forward-looking
statements may relate to future financial conditions, results of operations, plans, objectives, performance or business developments.
These statements speak only as at the date they are made and are based on information currently available and on the then current expectations
of the party making the statement and assumptions concerning future events, which are subject to a number of known and unknown risks,
uncertainties and other factors that may cause actual results, performance or achievements to be materially different from that which
was expressed or implied by such forward-looking statements, including, but not limited to, risks and uncertainties described in “Risk
Factors.”
Although
we believe that the expectations and assumptions on which such forward-looking statements are based are reasonable, undue reliance should
not be placed on the forward-looking statements, because no assurance can be given that they will prove to be correct. Since forward-looking
statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results could
differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to the risks
described in “Risk Factors.”
Consequently,
all forward-looking statements made in this MD&A and other documents, as applicable, are qualified by such cautionary statements,
and there can be no assurance that the anticipated results or developments will actually be realized or, even if realized, that they will
have the expected consequences to or effects on us. The cautionary statements contained or referred to in this section should be considered
in connection with any subsequent written or oral forward-looking statements that we and/or persons acting on its behalf may issue. We
do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events
or otherwise, other than as required under securities legislation.
Overview
of the Business
We
are a development-stage technology company dedicated to providing a suite of green energy solutions which we call the Evirontek Integrated
Platform with a focus on cryptocurrency mining, data centers, commercial and residential utility, electric vehicle, and other renewable
energy initiatives. We seek to offer our Evirontek Integrated Platform to resolve the exorbitantly high cost of electricity in crypto
mining and related industries. Our initial core technology is Tesdison; a revolutionary U.S. patented self-charging dual-battery system
technology providing increased efficiency in power generation. We plan to seek business partnerships with renewable energy providers
for various applications and engage with value-added resellers to facilitate and implement our scalable and modular system solution.
There
is an urgency in the global needs of today’s ever-changing energy landscape in the world of cryptocurrency mining where power saving
is the most challenging issue for this business. Our goal is to change the future of the cryptocurrency mining businesses by providing
our patented revolutionary green technology power-saving solution that has been designed to be safe, reliable, cost effective, and easily
scalable.
We
plan to initially market the Evirontek Integrated Platform to the cryptocurrency mining industry to reduce the exorbitant high cost of
electricity. The Evirontek Integrated Platform, once fully developed, will be comprised of (1) a patented high efficiency electric power
generation and charging system which we license and call the “Tesdison Technology”, (2) a chipset and related software component
we plan to develop which we call the “Bitech Intellisys-8 Chipset Solution” or “Intellisys-8”, (3) Battery Energy
Storage Systems (BESS) technology solution for power grid efficiency, and (4) other complementary clean energy technologies that we plan
to acquire. Combined, we refer to these technologies as the Evirontek Integrated Platform.
To
respond to the current increasing demand in energy efficiency solutions while expanding our potential revenue options, we also plan to
(1) become a Resource Entity (RE) operating our own state-of-the-art Battery Energy Storage Systems (BESS) solution in order to re-optimize
the power capacity and balance the grid with intelligent time peak shifting control, and (2) penetrate into the solar power plant market
and partner with or acquire outdated, mid-field solar power plants in the U.S., especially in California and Texas, and implement a BESS
solution to increase energy efficiency and monetize time peak shifting implementation with targeted power plants ranging from 20MW to
500MW. Our planned containerized BESS solution is expected to provide a high level of user-friendly and seamless integration, intelligent
monitoring ability with multimode authorization for dynamic connection, ultimate safety features, and flexible application via modular
design, while enhancing robustness for interference from external factors in the field.
The Company acquired Bitech Mining Corporation, a
Wyoming corporation (“Bitech Mining”) on March 31, 2022 (the “Closing Date”) through a share exchange pursuant
to a Share Exchange Agreement (the “Share Exchange Agreement”) by and among the Company, Bitech Mining, each of Bitech Mining’s
shareholders (each, a “Seller” and collectively, the “Sellers”), and Benjamin Tran, solely in his capacity as
Sellers’ Representative (“Sellers’ Representative”). The transaction contemplated by the Share Exchange Agreement
is hereinafter referred to as the “Share Exchange”). The Share Exchange Agreement provides that the Company will acquire from
the Sellers, an aggregate of 94,312,250 shares of Bitech Mining’s Common Stock, par value $0.001 per share, representing 100% of
the issued and outstanding shares of Bitech Mining (collectively, the “Bitech Mining Shares”). In consideration of the Bitech
Mining Shares, the Company issued to the Sellers an aggregate of 9,000,000 shares of the Company’s newly authorized Series A Convertible
Preferred Stock, par value $0.001 per share (the “Series A Preferred Stock”). Each Bitech Mining Share shall be entitled to
receive 0.09543 shares of Series A Preferred Stock. Each share of Series A Preferred Stock shall automatically convert into 53.975685
shares (an aggregate of approximately 485,781,300) of the Company’s Common Stock (the “Company Common Stock”) upon filing
of an amendment to its Certificate of Incorporation increasing the number of the Company’s authorized common stock so that there
are a sufficient number of shares of Company Common Stock authorized but unissued to permit a full conversion of all the Series A Preferred
Stock. Upon conversion of the Series A Preferred Stock, the Sellers will hold, in the aggregate, approximately 96% of the issued and outstanding
shares of Company capital stock on a fully diluted basis.
The Share Exchange was treated as a recapitalization
and reverse acquisition for financial reporting purposes, and Bitech Mining is considered the acquirer for accounting purposes. As a result
of the Share Exchange and the change in our business and operations, a discussion of the past financial results of our predecessor, Spine
Injury Solutions Inc., is not pertinent, and under applicable accounting principles, the historical financial results of Bitech Mining,
the accounting acquirer, prior to the Share Exchange are considered our historical financial results.
The
following agreements were entered into in connection with the acquisition of Bitech Mining:
Management
Services Agreement
On
the Closing Date, the Company, Quad and Peter L. Dalrymple (“Dalrymple”), a former director of the Company, entered into
a Management Services Agreement (the “MSA”) whereby Dalrymple agreed to act as the general manager of the video recording
operations of Quad and collect certain accounts receivable of the Company (the “Services”). In exchange for providing the
Services, the Company agreed to pay Dalrymple a fee equal to the net revenues derived from these operations after payment of all operating
expenses related to such operations. The term of the MSA commences on the Closing Date and continues until the earlier to occur of the
following: (i) 90 days after the Closing Date; (ii) the Company and Dalrymple’s mutual written consent; or (iii) any material breach
of the MSA by either party, provided that the breaching party has been provided written notice of such breach and has failed to cure
such breach within ten (10) days of receipt of such written notice.
Amendment
to the Note
On
the Closing Date, the Company, Quad and Dalrymple, entered into an Amendment to the Secured Promissory Note (the “Note Amendment”)
whereby Dalrymple agreed that (i) the principal and accrued interest outstanding under the Secured Promissory Note dated August 31, 2020
as amended on October 29, 2021 issued by the Company in favor of Dalrymple (collectively, the “Note”) is $95,000 as
of the Closing Date, (ii) the date on which the outstanding principal and accrued interest is due is 90 days after the Closing Date,
(iii) any obligations of (x) the Company that become due and owing to Bitech Mining or the Sellers under Section 4.07(c) of the Share
Exchange Agreement or (y) that become due and owing under Section 6.12 of the MSA may be offset against any amounts owed by the Company
or Quad under the Note and (iv) all claims or causes of action (whether in contract or in tort, in law or in equity) that may be based
upon, arise out of or relate to the Note, or the negotiation, execution or performance of the Note (including any representation or warranty
made in or in connection with the Note or as an inducement to enter into the Note or this Amendment), may be made only against Quad,
and SPIN who is not a party to the Note as of the Closing Date, including without limitation any past, present or future director, officer,
employee, incorporator, member, manager, partner, equity holder, affiliate, agent, attorney or representative of SPIN (“SPIN Parties”),
shall have no liability (whether in contract or in tort, in law or in equity, or based upon any theory that seeks to impose liability
of the SPIN Parties) for any obligations or liabilities arising under, in connection with or related to the Note or for any claim based
on, in respect of, or by reason of the Note or its negotiation or execution, and Dalrymple waives and releases all such liabilities,
claims and obligations against any such SPIN Parties.
Amendment
to the Security Agreement
On
the Closing Date, the Company, Quad and Dalrymple, entered into an Amendment to Security Agreement (the “Security Agreement Amendment”)
whereby the parties to that agreement agreed that (i) Quad shall be included with the Company as an additional debtor for all purposes
in the Security Agreement entered into between the Company and Dalrymple dated August 31, 2020 (the “Security Agreement”),
(ii) Quad’s collateral obligations under the Security Agreement shall only relate to its accounts receivable, and the collateral
described relating to “Pledged Securities” as defined in the Security Agreement shall not apply to Quad’s obligations
under the Security Agreement, (iii) the Company’s pledge of its accounts receivables as provided for in the Security Agreement
will be limited solely to the Company’s accounts receivables in existence as of March 27, 2022 at 11:59 P.M. ET, and shall not
apply to any after acquired accounts receivables and (iv) the Company is authorized to file an amended financing statement to reflect
the terms of Security Agreement Amendment and Quad shall promptly file a financing statement reflecting the terms set for in such amendment.
Prior to March 31, 2022, we were engaged in the business of owning, developing and leasing the Quad Video Halo video
recording system (“QVH”) used to record medical procedures including the collection of accounts receivables related to previously
provided spine injury diagnostic services (collectively, the “QVH Business”).
Additionally,
the COVID-19 pandemic has made it difficult for us to collect our accounts receivable, as attorney and medical offices are closed resulting
in delayed settlements and medical procedures being canceled, which affects our lease revenue. We are uncertain how this pandemic will
affect our ability to collect in the future or its overall effect on our lease revenue.
Comparison
of the three month period ended March 31, 2022 with the three month period ended March 31, 2021.
The
Company has not generated any revenues from its primary business for the three months ended March 31, 2022 and March 31, 2021.
During
the three months ended March 31, 2022, we incurred $229,162 of general and administrative expenses compared to $17,131 for the same period
in 2021. General and administrative expenses have increased during 2022 compared to 2021 as the Company moves from development stage
to revenue generation.
As
a result of the foregoing, we had net loss of ($229,162) for the three months ended March 31, 2022, compared to a net loss of ($17,131)
for the three months ended March 31, 2021.
Working
Capital
The
calculation of Working Capital provides additional information and is not defined under GAAP. We define Working Capital as current assets
less current liabilities. This measure should not be considered in isolation or as a substitute for any standardized measure under GAAP.
This information is intended to provide investors with information about our liquidity.
Other
companies in our industry may calculate this measure differently than we do, limiting its usefulness as a comparative measure.
Liquidity
and Capital Resources
As of March 31, 2022 and December
31, 2021, we had total current liabilities of $491,834 and $11,106, respectively, and current assets of $1,168,653 and $976,947, respectively,
to meet our current obligations. As of March 31, 2022, we had working capital of $676,810, a decrease of working capital of $289,031 as
compared to December 31, 2021, driven primarily by cash used in operations.
For the three months ended March 31, 2022, cash used
in operations was ($145,686) which primarily included the net loss of ($229,162) partially offset by an increase of accounts payable and
accrued liabilities of $85,747.
We have a history of operating losses. We have not yet achieved profitable
operations and expect to incur further losses. We have funded our operations primarily from equity financing. As of March 31, 2022, cash
generated from financing activities was not sufficient to fund the full development of the components of the Evirontek Integrated Platform,
in particular, to fund our growth strategy in the short-term or long-term. The primary need for liquidity is to fund working capital requirements
of the business, including operational expenses, develop and commercialize the Evirontek Integrated Platform and the capital expenditures
associated with that project. The primary source of liquidity has primarily been private financing transactions. The ability to fund operations,
to make planned capital expenditures, to execute on the development and commercialization of the Evirontek Integrated Platform depends
on our ability to raise funds from debt and/or equity financing which is subject to prevailing economic conditions and financial, business
and other factors, some of which are beyond our control. There can be no assurance that additional financing will be available to us when
needed or, if available, that it can be obtained on commercially reasonable terms.
Off-Balance
Sheet Arrangements
As
of the date of this Quarterly Report on Form 10-Q/A (Amendment No. 1), we do not have any off-balance-sheet arrangements that have, or are reasonably likely
to have, a current or future effect on our results of operations or financial condition, including, and without limitation, such considerations
as liquidity and capital resources.
Transactions
with Related Parties
Up
until March 31, 2022, the Company maintained its executive offices at 5151 Mitchelldale A2, Houston, Texas 77092. This office space encompasses
approximately 200 square feet and was provided to us at the rental rate of $1,000 per month under a month-to-month agreement with Northshore
Orthopedics, Assoc. (“NSO”), a company owned by William Donovan, M.D., our former director and Chief Executive Officer. The
rent included the use of the telephone system, computer server, and copy machines. We discontinued paying rent in December 2021 due to
a lack of funds, and since then NSO has provided the Company this office space rent free.
Also,
see discussion above regarding the MSA, the Note, the Note Amendment, the Security Agreement and the Security Agreement Amendment.
Changes
in or Adoption of Accounting Practices
There
were no material changes in or adoption of new accounting practices during the three months ended March 31, 2022.
Critical
Accounting Policies
See
Note 2 of the accompanying notes to unaudited condensed consolidated financial statements, which note is incorporated herein by reference.