THUNDER ENERGIES CORP Management's Discussion and Analysis of Financial Condition and Results of Operations. (form 10-K)

October 18, 2022 at 12:55 pm EDT

The following Management's Discussion and Analysis of Financial Condition and Results of Operations contain forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under "Risk Factors" and elsewhere in this report. The management's discussion, analysis of financial condition, and results of operations should be read in conjunction with our financial statements and notes thereto contained elsewhere in this prospectus.

Corporate History and Background

Thunder Energies Corporation ("we", "us", "our", "TNRG" or the "Company") was incorporated in the State of Florida on April 21, 2011.

On July 29, 2013, the Company filed with the Florida Secretary of State, Articles of Amendment to its Articles of Incorporation (the "Amendment") which changed the name of the Company from CCJ Acquisition Corp. to Thunder Fusion Corporation. The Amendment also changed the principal office address of the Company to 150 Rainville Road, Tarpon Springs, Florida 34689. On May 1, 2014, the Company filed with the Florida Secretary of State, Articles of Amendment to its Articles of Incorporation (the "Amendment") which changed the name of the Company from Thunder Fusion Corporation to Thunder Energies Corporation. The Company subsequently changed its principal office address to 3017 Greene St., Hollywood, Florida 33020.

On March 24, 2020, the Company announced its operational affiliate plans with Saveene.Com Inc. ("Saveene") the preferred shareholder. Under the agreement, Saveene granted the Company access to several yachts and jets for the purpose of offering these vessels to the end-user and the general public for sale and or charter. Additionally, the Company gained access to several patent-pending technologies and the entire Saveene back office that focuses on the yacht and jet industry sector. This operational affiliate plan with Saveene.Com allowed the Company to offer a white-label type solution and original equipment manufacturer under the Company's own brand name Nacaeli, dispensing the need to acquire and carry any inventory. All future Company and or Nacaeli brand fulfillment orders general maintenance, and upkeep matters such as mechanical repair, buffering, and similar will be outsourced other than administrative operational and corporate governance tasks.

On March 24, 2020, the Company held a meeting and voted to create two separate classes of preferred shares. Class "B" and class "C' preferred shares. One class of shares B would be used to offer securitization for the watercraft while class C preferred shares would be used in conjunction with the securitization of air crafts.

Series B Convertible Preferred Stock (the "Preferred Stock") was authorized for 10,000,000 shares of the Company. Each share of Preferred Stock is entitled to one thousand (1,000) votes per share and at the election of the holder converts into one thousand (1,000) shares of Company's common stock, so at the completion of the stock purchase, the Purchaser owns approximately 100% of the fully diluted outstanding equity securities of the Company and approximately 100% of the voting rights for the outstanding equity securities. The consideration for the purchase was provided to the Purchaser from the private funds of the principal of the Purchaser.

Series C Non-Convertible Preferred Stock (the "Preferred Stock") was authorized for 10,000,000 shares of the Company. Each share of Preferred Stock is entitled to one thousand (1,000) votes per share and at the election of the holder. The series C is Non-Convertible Preferred Stock. The Purchaser owns approximately 100% of the fully diluted outstanding equity securities of the Company and approximately 100% of the voting rights for the outstanding equity securities. The consideration for the purchase was provided to the Purchaser from the private funds of the principal of the Purchaser.

On March 24, 2020, the note obligation of $120,766 held by Emry was partially sold $35,000 of the face amount to the preferred shareholder Saveene. On March 24, 2020, Saveene converted the $35,000 purchase into 5,000 shares into series B and 10,000 shares of series C shares. The face amount of the Company note obligation post the aforementioned conversions and purchases is $85,766 as of December 31, 2020.

Acquisition of TNRG Preferred Stock





Fiscal Year 2022

On February 28, 2022, Mr. Ricardo Haynes, Mr. Eric Collins, Mr. Lance Lehr, Ms. Tori White and Mr. Donald Keer, each as an individual and principal shareholders of Bear Village, Inc., a Wyoming corporation, (the "Purchaser") personally acquired 100% of the issued and outstanding shares of preferred stock (the "Preferred Stock") of Thunder Energies Corporation, a Florida corporation, (the "Company" or the "Registrant") from Mr. Yogev Shvo, an individual domiciled in Florida (the "Seller"). (The "Purchase") The consideration for the purchase was provided to the Purchaser from the individual's private funds.

The Preferred Stock acquired by the Purchaser consisted of:





  1. 50,000,000 shares of Series A Convertible Preferred Stock wherein each share
     is entitled to fifteen (15) votes and converts into ten (10) shares of the
     Company's common stock.
  2. 5,000 shares of Series B Convertible Preferred Stock wherein each share is
     entitled to one thousand (1,000) votes and converts into one thousand
     (1,000) shares of the Company's common stock.
  3. 10,000 shares of Series C Non-Convertible Preferred Stock wherein each share
     is entitled to one thousand (1,000) votes and is non-convertible into shares
     of the Company's common stock.

As a result of the Purchase, the Purchaser owns approximately 100% of the fully diluted outstanding equity securities of the Company and approximately 100% of the voting rights for the outstanding equity securities.

As part of the Purchase, Mr. Shvo submitted 55,000,000 shares of restricted common stock to the Company's treasury for cancellation.

The purchase price of $50,000 for the Preferred Stock was paid in cash. The consideration for the purchase was provided to the Purchaser from the individuals private funds. The Purchase of the Preferred Stock was the result of a privately negotiated transaction which consummation resulted in a change of control of the Registrant.

1) Purchaser acquired TNRG subject to the following existing debt and


    obligations:

a. $35,000 Convertible Note held by ELSR plus accrued interest

b. $85,766 Convertible Note held by ELSR plus accrued interest

c. $220,000 Convertible Note held by 109 Canon plus accrued interest

d. $410,000 Convertible Note held by Moshe Zucker plus accrued interest of which

$190,000 has recently been converted into 3,800,000 shares of restricted

common stock.

e. Auditor Invoice estimated at $30,000 past due and $37,000 for completion of

2021

f. Accountant Invoice estimated at $42,500 and approximately $4,500 for

completion of 2021

g. No other debt or liability is being assumed by Purchaser

h. Purchaser specifically assumes no liability regarding any dispute between Orel

Ben Simon and the Seller. Seller shall indemnify Company as required in the

body of the Agreement.

i. Company may be subject to potential liability and legal fees and associated

costs regarding the FCV Matter if in excess of the Seller indemnification

provisions set forth in Section 11 of the Agreement

j. Purchaser on behalf of the Company is responsible for assuring the Company's

timely payment of all Company federal and state and any related tax

obligations for fiscal year 2021 with the exception of taxes due relating to

income, sales, license, business or any other taxes associated with Nature and

2) The transfer to Seller of all of TNRG's security ownership interest in each of


    Nature and HP to Seller shall include the following existing Nature debt and
    related matters:

a. EIDL Loan ($149,490 plus $9,290 accrued interest)

b. $72,743 note due to Orel Ben Simon plus accrued interest

c. All cases in action and potential legal liabilities concerning current

disputes with Nature, HP, Ben Simon, Seller and any other parties.

As a result of the Purchase and change of control of the Registrant, the existing officers and directors of the Company, Mr. Adam Levy, Mr. Bruce W.D. Barren, Ms. Solange Bar and Mr. Yogev Shvo (Chairman) have either resigned or been voted out of their positions.

Under the terms of the stock purchase agreement the new controlling shareholder was permitted to elect representatives to serve on the Board of Directors to fill the seat(s) vacated by prior directors. Mr. Ricardo Haynes became the sole Director, CEO and Chairman of the Board of the Registrant, and the acting sole officer of the Company.





Fiscal Year 2020

On July 1, 2020, Yogev Shvo, a third party individual and principal shareholder of Nature Consulting LLC ("Nature" or "Purchaser") personally acquired 100% of the issued and outstanding shares of preferred stock (the "Preferred Stock") of TNRG from Saveene Corporation, a Florida corporation (the "Seller") (The "Purchase"). The Purchase price of $250,000 for the Preferred Stock was paid in cash and was provided from the individual private funds of Purchaser.

The Preferred Stock acquired by the Purchaser consisted of:





       1.     50,000,000 shares of Series A Convertible Preferred Stock
              wherein each share is entitled to fifteen (15) votes and converts
              into ten (10) shares of the Company's common stock.
       2.     5,000 shares of Series B Convertible Preferred Stock wherein each
              share is entitled to one thousand (1,000) votes and converts into
              one thousand (1,000) shares of the Company's common stock.
       3.     10,000 shares of Series C Non-Convertible Preferred Stock wherein
              each share is entitled to one thousand (1,000) votes and is
              non-convertible into shares of the Company's common stock.

Acquisition of Assets of Nature

On August 14, 2020 (the "Closing Date"), TNRG and the members of Nature entered into an Interest Purchase Agreement (the "Interest Purchase Agreement"), which closed on the same date. Pursuant to the terms of the Interest Purchase Agreement, the members of Nature sold all of their membership interests in Nature to TNRG in exchange for sixty million (60,000,000) shares of TNRG's Common Stock. As a result of this transaction, Nature became a wholly-owned subsidiary of TNRG.

The Interest Purchase Agreement contained customary representations and warranties and pre- and post-closing covenants of each party and customary closing conditions. Breaches of the representations and warranties will be subject to customary indemnification provisions, subject to specified aggregate limits of liability.

The membership Interest Purchase Agreement will be treated as an asset acquisition by the Company for financial accounting purposes. Nature will be considered the acquirer for accounting purposes, and the historical financial statements of Nature, before the membership exchange will replace the historical financial statements of TNRG before the membership exchange and in all future filings with the SEC.

Immediately following the Interest Purchase Agreement, the business of Nature became TNRG's main operation. Nature is the premier source of turnkey CBD and Hemp extract solutions. The Company was founded in February 2019.

Description of Business, Principal Products, Services

Nature Consulting, LLC's Mission

Our mission is to be the leading seed-to-sale manufacturer and supplier of high-quality CBD products in the industry. We have identified the following issues as our critical drivers:





       1.     Strong Research and Development- The Nature team is focused on
              delivering cutting edge, innovative research and development
              practices that keep it ahead of the competition while it focuses on
              creating new and exciting formulations, extraction methods, and
              product categories.
       2.     Quality Products & Processes- Nature's products are manufactured
              using only the best ingredients meeting the highest specifications
              for purity, potency, and quality, ensuring consistency in its
              premium CBD and hemp.
       3.     Supply Chain Control- Nature controls the entire production process,
              from the farm to the final process. By handling every step along the
              way, the Company ensures a streamlined, seamless, reliable supply
              chain.

Nature Consulting, LLC's Product Portfolio

On August 14, 2020, we announced the closing of the acquisition of Nature Consulting ("Nature"). Nature manufactures, markets and distributes U.S. hemp-derived supplements and cosmetic products through e-commerce and wholesale distribution in the U.S. under the brand The Hemp Plug. Nature is an innovative leader in quality extraction and sourcing, expert brand building, and targeted marketing for retailers and wholesalers throughout the world. From customization to order fulfillment to brand development and label design, THP provides guided support every step of the way through tailored business strategy. It features the largest collection of customizable CBD and hemp products on the market.

We are committed to building a portfolio of iconic brands that responsibly elevate the consumer experience.

In the U.S., we market and distribute solely U.S. hemp-derived supplements and cosmetics products through e-commerce and wholesale distribution under the brands The Hemp Plug.

We sell a variety of CBD and hemp products, including hemp flower, pre-rolls and hemp extracts (in the form of tinctures and vaporizers), U.S. hemp-derived supplements, and cosmetics through wholesale and direct-to-client channels.

The Company has begun its planned principal operations, and accordingly, the Company has prepared its consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP").









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Recent Developments



Due to Former Shareholder

On March 1, 2020, the members of Nature entered into the Ownership Interest Purchase Agreement ("Ownership Agreement") whereby Yogev Shvo, a member of the Company, acquired the remaining 50% member ownership ("Seller") giving Mr. Shvo 100% member ownership of the Company. As consideration for the Ownership Agreement, the Seller received a Promissory Note of $750,000. The Promissory Note bears interest at 15% per annum and matures March 1, 2022, as amended on June 30, 2021. During the year ended December 31, 2021, the Company made repayments of $193,000 for a balance of $72,743 under Due to Related Parties in the accompanying Balance Sheet at December 31, 2021. The Note is secured with the assets of the Company pursuant to a security agreement dated March 1, 2020. In addition, the Company's CEO has personally guaranteed the Note.

The Company borrows funds from related parties for working capital purposes from time to time. The Company has recorded the principal balance due of $0 under Due to Related Parties in the accompanying Consolidated Balance Sheet at December 31, 2021. The Company received no advances and made repayments of $50,000 during the year ended December 31, 2021. Advances are non-interest bearing and due on demand. See Note 1 for impairment discussion as of December 31, 2021.





Loans Payable



Loan Payable to Shareholder

The Company borrows funds from its shareholders from time to time for working capital purposes. During the year ended December 31, 2021, the Company had no additional borrowings and made repayments of $68,405 for a balance of $0 at December 31, 2021. Advances are non-interest bearing and due on demand.





Economic Injury Disaster Loan

On May 14, 2020, the Company executed the standard loan documents required for securing a loan (the "EIDL Loan") from the SBA under its Economic Injury Disaster Loan ("EIDL") assistance program in light of the impact of the COVID-19 pandemic on the Company's business.

Pursuant to that certain Loan Authorization and Agreement (the "SBA Loan Agreement"), the Company borrowed an aggregate principal amount of the EIDL Loan of $150,000, with proceeds to be used for working capital purposes. Interest accrues at the rate of 3.75% per annum and will accrue only on funds actually advanced from the date of each advance. Installment payments, including principal and interest, are due monthly beginning May 14, 2021 (twelve months from the date of the SBA Note) in the amount of $731. The balance of principal and interest is payable thirty years from the date of the SBA Note. In connection therewith, the Company also received a $7,000 grant, which does not have to be repaid. During the year ended December 31, 2020, $7,000 was recorded in Other Income in the Statements of Operations. During the year ended December 31, 2021., the Company recorded no amounts as Other Income.

In connection therewith, the Company executed (i) a note for the benefit of the SBA (the "SBA Note"), which contains customary events of default and (ii) a Security Agreement, granting the SBA a security interest in all tangible and intangible personal property of the Company, which also contains customary events of default (the "SBA Security Agreement"). As a result of the failure to repay amounts based on the repayment schedule, on December 21, 2021, the Company was notified that it was in default of the EIDL Loan and that the entire balance of principal and unpaid interest of $155,598 is due.

Paycheck Protection Program Loan Round 1

On May 6, 2020, the Company executed a note (the "PPP Note") for the benefit of TD Bank, N.A. (the "Lender") in the aggregate amount of $51,065 under the Paycheck Protection Program ("PPP") of the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act"). The PPP is administered by the U.S. Small Business Administration (the "SBA"). The interest rate of the loan is 1.00% per annum and accrues on the unpaid principal balance computed on the basis of the actual number of days elapsed in a year of 360 days. Commencing seven months after the effective date of the PPP Note, the Company is required to pay the Lender equal monthly payments of principal and interest as required to fully amortize any unforgiven principal balance of the loan by the two-year anniversary of the effective date of the PPP Note. The PPP Note of $51,065 was repaid in February 2021.

Paycheck Protection Program Loan Round 2

On April 2, 2021, the Company executed a note (the "PPP Note") for the benefit of First Federal Bank (the "Lender") in the aggregate amount of $200,000 under the Paycheck Protection Program ("PPP") of the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") through a second draw. The PPP is administered by the U.S. Small Business Administration (the "SBA"). The terms of the second draw have the same general loan terms as the first draw PPP loan. On December 31, 2021, the PPP Round 2 loan was forgiven and $200,000 was recorded as Other Income in the consolidated Statements of Operations.





Convertible Note Payable



Short Term



$85,766 Note

On April 22, 2019; The Company executed a convertible promissory note with GHS Investments, LLC ("GHS Note"). The GHS Note carries a principal balance of $57,000 together with an interest rate of eight (8%) per annum and a maturity date of February 21, 2020. All payments due hereunder (to the extent not converted into common stock, $0.001 par value per share) in accordance with the terms of the note agreement shall be made in lawful money of the United States of America. Any amount of principal or interest on this GHS Note which is not paid when due shall bear interest at the rate of twenty two percent (22%) per annum from the due date thereof until the same is paid. As of December 31, 2019, the principal balance outstanding was $57,000.

The holder shall have the right from time to time, and at any time during the period beginning on the date which is one hundred eighty (180) days following the date of this note, to convert all or any part of the outstanding and unpaid principal amount into Common Stock. The conversion shall equal sixty-five percent (65%) of the lowest trading prices for the Common Stock during the twenty (20) day trading period ending on the latest complete trading day prior to the conversion date, representing a discount rate of thirty-five percent (35%).

The Company accounts for an embedded conversion feature as a derivative under ASC 815-10-15-83 and valued separately from the note at fair value. The embedded conversion feature of the note is revalued at each subsequent reporting date at fair value and any changes in fair value will result in a gain or loss in those periods. The Company recorded a derivative liability of $83,404, recorded a change in derivative liability of $40,776 and $21,445 during the years ended December 31, 2021 and 2020, respectively.

$220,000 Note

On September 21, 2020, the Company issued a convertible promissory note in the principal amount of $220,000. The convertible promissory note bears interest at 8% per annum and is due and payable in twenty-four (24) months. The holder of this note has the right, at the holder's option, upon the consummation of a sale of all or substantially all of the equity interest in the Company or private placement transaction of the Company's equity securities or securities convertible into equity securities, exclusive of the conversion of this note or any similar notes, to convert the principal amount of this note, in whole or in part, plus any interest which accrues hereon, into fully paid and nonassessable shares at a conversion price of $0.05 per share. The Note includes customary events of default, including, among other things, payment defaults, covenant breaches, certain representations and warranties, certain events of bankruptcy, liquidation and suspension of the Company's Common Stock from trading. If such an event of default occurs, the holders of the Note may be entitled to take various actions, which may include the acceleration of amounts due under the Note and accrual of interest as described above.

The principal balance due at December 31, 2021 is $220,000 and is presented as a short-term liability in the balance sheet.

As a result of the failure to timely file our Form 10-Q for the three-month period ended September 30, 2020, the Form 10-K for the year ended December 31, 2020, and the three-month period ended March 31, 2021, the Convertible Notes Payable were in default. On July 19, 2021, the Company entered into a Waiver Agreement (the "Agreement") waiving the default provisions listed in the Notes related to the Company's failure to timely file its Form 10-Q for the three-month period ended September 30, 2020, the Form 10-K for the year ended December 31, 2020, and the three-month period ended March 31, 2021. In exchange for the Agreement, the Company agreed to pay a one-time interest charge of $11,680 in the year ended December 31, 2021.

$410,000 Note (previously $600,000)

On October 9 and October 16, 2020, the Company issued a convertible promissory note in the principal amount totaling $600,000. The convertible promissory note bears interest at 8% per annum and is due and payable in twenty-four (24) months. The holder of this note has the right, at the holder's option, upon the consummation of a sale of all or substantially all of the equity interest in the Company or private placement transaction of the Company's equity securities or securities convertible into equity securities, exclusive of the conversion of this note or any similar notes, to convert the principal amount of this note, in whole or in part, plus any interest which accrues hereon, into fully paid and nonassessable shares at a conversion price of $0.05 per share. The Note includes customary events of default, including, among other things, payment defaults, covenant breaches, certain representations and warranties, certain events of bankruptcy, liquidation and suspension of the Company's Common Stock from trading. If such an event of default occurs, the holders of the Note may be entitled to take various actions, which may include the acceleration of amounts due under the Note and accrual of interest as described above.

On December 6, 2021, the holder of the note converted $190,000 of the Note into 3,800,000 shares of the Company's common stock. The principal balance of $410,000 is due October 16, 2022 and is presented as a short term liability in the balance sheet.

As a result of the failure to timely file our Form 10-Q for the three-month period ended September 30, 2020, the Form 10-K for the year ended December 31, 2020, and the three-month period ended March 31, 2021, the Convertible Notes Payable were in default. On July 15, 2021, the Company entered into a Waiver Agreement (the "Agreement") waiving the default provisions listed in the Notes related to the Company's failure to timely file its Form 10-Q for the three-month period ended September 30, 2020, the Form 10-K for the year ended December 31, 2020, and the three-month period ended March 31, 2021. Therefore, no default interest has been accrued in these financial statements.









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April 2022 Notes

In April 2022, the Company authorized convertible promissory notes ("April 2022 Notes") that pay interest at 10% per annum and are due and payable on December 31, 2022 for aggregate gross proceeds of $347,500 through August 31, 2022. The holders of the April 2022 Notes have the right, at the holder's option, to convert the principal amount of this note, in whole or in part, plus any interest which accrues hereon, into fully paid and nonassessable shares at a conversion price of $0.07 per share into the Company's common stock if before any public offering. The Note includes customary events of default, including, among other things, payment defaults and certain events of bankruptcy. If such an event of default occurs, the holders of the Note may be entitled to take various actions, which may include the acceleration of amounts due under the Note and accrual of interest as described above.

The Company analyzed the conversion option in the notes for derivative accounting treatment under ASC Topic 815, "Derivatives and Hedging," and determined that the instrument does not qualify for derivative accounting. The Company therefore performed an analysis to determine if the conversion option was subject to a beneficial conversion feature ("BCF") and determined that the instrument does not have a BCF.

$40,000,000 Convertible Note

On May 13, 2022, the Company issued a convertible promissory note in the principal amount totaling $40,000,000 in exchange for 50,000 RoRa Prime Coins ("Coins"), valued at $800 per Coin. The convertible promissory note bears no interest and is due and payable in twenty-four (24) months. The holder of this Note has the right, at the holder's option, to convert the principal amount of this Note, in whole or in part, into fully paid and nonassessable shares at a conversion price of $2.00 per share. Conversion rights shall not vest until such time as the holder's consideration, Coins are live on a U.S. Exchange and available through a mutually agreed upon cryptocurrency wallet. The expected date for being live is November 1, 2022. Subsequent to the Coins live date and before the holder coverts the Note, should the Company issue any dilutive security, the conversion price will be reduced to the price of the dilutive issuance. The Note includes customary events of default, including, among other things, payment defaults, covenant breaches, certain representations and warranties, certain events of bankruptcy, liquidation and suspension of the Company's Common Stock from trading. If such an event of default occurs, the holders of the Note may be entitled to take various actions, which may include the acceleration of amounts due under the Note as described above.





Investment in Fourth &One

On September 8, 2022, the Company entered into a Membership Interest Purchase Agreement ("Agreement") with Fourth & One, LLC ("Fourth & One") with respect to the sale and transfer of 51.5% of Fourth & One's interest in WC Mine Holdings, LLC ("WCMH") giving the Company a 30.9% ownership in WCMH for consideration totaling $5,450,000. In exchange, the Company issued Fourth & One a promissory note of $4,000,000 and 2,000 RoRa Prime digital coins ("Coins"), valued at $1,450,000. The promissory note provides for no interest and matures on October 31, 2022 ("Maturity Date"). In addition, the promissory note provides that the Company may convert all amounts at any time prior to the Maturity Date and after gaining approval by the Securities and Exchange Commission of the Company's REG A II Offering and Fourth & One may convert all amounts into common stock prior to the Maturity Date at a conversion price of $2.00 per share. The Agreement also provides that should Fourth & One not be able to convert the Coins on or before October 31, 2022 at a conversion ratio of $800 per Coin, the Company will purchase all of the Coins for a total of $1,600,000 (2,000 Coins at $800 per Coin) on October 31, 2022.





Promissory Debenture

On February 15, 2020 and on May 14, 2020, the Company entered into Promissory Agreement and Convertible Debentures ("Promissory Debentures") with Emry for a principal sum of $70,000 (which was paid in two tranches: $50,000, paid on February 15, 2020, and $20,000, paid in April 2020) and $48,000 (which was paid in three tranches: $23,000, paid on May 14, 2020, $15,000, paid on May 22, 2020, and $10,000, paid on June 8, 2020), respectively. The Promissory Debenture bears interest, both before and after default, at 15% per month, calculated and compounded monthly. At the election of the holder, at any time during the period between the date of issuance and the one year anniversary of the Promissory Debentures, the Promissory Debentures are convertible into shares of the Company's common stock at any time at a conversion price of $0.001 per share. In addition, the Promissory Debentures provide for an interest equal to 15% of the Company's annual sales, payable on the 2nd day following the date of issuance of the Company's audited financial statements.

On June 24, 2020, Emry, holder of (i) Promissory Debentures in principal amount of $70,000 dated February 15, 2020, and (ii) that certain convertible promissory note in principal amount of $85,766 dated April 22, 2019, sold 50% of each (Promissory Debentures and convertible promissory note), including accrued and unpaid interest, fees and penalties, in separate transactions to third party companies, SP11 Capital Investments and E.L.S.R. CORP, Florida companies, such that SP11 Capital Investments and E.L.S.R. CORP each hold 50% of each respective debt instrument.

On October 4, 2020, SP11 converted $35,000 of its Promissory Debentures at $0.01 per share into 3,500,000 shares of the Company's common stock.

On November 22, 2021, the loan of $48,000 and accrued and unpaid interest of $573,798 totaling $621,798 was forgiven by EMRY and recorded as a gain on extinguishment of debt in Other Expense in the consolidated Statements of Operations.

As a result of the failure to timely file our Form 10-Q for the three month period ended September 30, 2020 and the Form 10-K for the year ended December 31, 2020, the Promissory Debentures were in default. On July 15, 2021, the Company entered into a Waiver Agreement (the "Agreement") waiving the default provisions listed in the $48,000 note related to the Company's failure to timely file its Form 10-Q for the three month period ended September 30, 2020 and the Form 10-K for the year ended December 31, 2020. The $35,000 note provides for no default penalties.





Stock Transactions

On December 6, 2021, the holder of the note converted $190,000 of the Note into 3,800,000 shares of the Company's common stock for a balance due of $410,000 at December 31, 2021 on the Note.

On October 13, 2020, the Company issued 195,480 common shares, valued at $33,232 (based on the Company's stock price on the date of issuance), to GHS Investments in settlement.

On October 4, 2020, SP11 converted $35,000 of its Promissory Debentures at $0.01 per share into 3,500,000 shares of the Company's common stock.

On August 14, 2020, the Company issued 60,000,000 common shares in conjunction with acquisition.





Employment Agreements

On March 1, 2022, as amended on October 1, 2022, Mr. Ricardo Haynes, the Company's Chief Executive Officer and President ("CEO") entered into an Employment Agreement with the Company. The Employment agreement terminates September 30, 2027 and automatically renews on a year-to-year basis unless terminated by either party on six months notice. In addition, Mr. Haynes is entitled to employee reimbursements totaling $820 per month, entitled to six (6) weeks paid vacation each year, provides for medical and dental insurance, and entitled to stock options upon the implementation of a Company employee option plan. Under this Employment agreement, the CEO will be entitled to the following:

· $5,700 for services performed from March 1, 2022 - June 30, 2022

· Lump Sum payment of $21,299.00 for services from July 1, 2022 - December 31,

2022

· 25,000,000 shares of TNRG common stock in the Company which vest immediately.

· 7,500,000 newly issued Preferred A shares of TNRG stock CUSIP (88604Y209) Cert

No. 400002

· 750 newly issued Preferred B shares of TNRG stock CUSIP (88604Y209), Cert. No.

500002

· 1,500 newly issued Preferred C shares of TNRG stock CUSIP (8860Y209), Cert No.

600002

· $7,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

· 1,500 RoRa Coins in possession of the Company.

On October 1, 2022, the Company entered into Employment Agreements with individuals for positions in the Company. Each of the Employment agreements shall begin October 1, 2022 and terminate September 30, 2027 and automatically renews on a year-to-year basis unless terminated by either party on six months notice. In addition, each employee is entitled to employee reimbursements totaling $820 per month, entitled to six (6) weeks paid vacation each year, provides for medical and dental insurance, and entitled to stock options upon the implementation of a Company employee option plan. Under these Employment agreements, each employee will be entitled to the following:

· Ms. Tori White, Director real Estate Development.

o $24,000 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 4,800 RoRa Coins in possession of the Company.

· Mr. Eric Collins, Chairman and Chief Operations Officer.

o $12,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 2,500 RoRa Coins in possession of the Company.

· Mr. Donald Keer, Corporate Counsel

o $3,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 700 RoRa Coins in possession of the Company.

· Mr. Lance Lehr, Chief Operating Officer

o $2,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 500 RoRa Coins in possession of the Company.






Consulting Agreements

On April 6, 2022, the Company entered into a Consulting Agreement with a third party to provide consulting services to the Company. The consulting agreement is in effect until the Company is profitable with a balance sheet of over $200 million or thirty-six (36) months, whichever is longer. Under this consulting agreement, the related party will be entitled to a total of 10,000,000 common, vest immediately, valued at $300,000 (based on the Company's stock price on the date of issuance) and will be expensed over the thirty-six (36) term of the Consulting agreement.

On April 6, 2022, the Company entered into a Consulting Agreement with a third party to provide consulting services to the Company. The consulting agreement is in effect until the Company is profitable with a balance sheet of over $200 million or thirty-six (36) months, whichever is longer. Under this consulting agreement, the related party will be entitled to a total of 5,000,000 common, vest immediately, valued at $150,000 (based on the Company's stock price on the date of issuance) and will be expensed over the thirty-six (36) term of the Consulting agreement.

Limited Operating History; Need for Additional Capital

There is limited historical financial information about us on which to base an evaluation of our performance. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, and possible cost overruns due to increases in the cost of services. To become profitable and competitive, we must receive additional capital. We have no assurance that future financing will materialize. If that financing is not available, we may be unable to continue operations.





Overview of Presentation

The following Management's Discussion and Analysis ("MD&A") or Plan of Operations includes the following sections:





  · Plan of Operations
  · Results of Operations
  · Liquidity and Capital Resources
  · Capital Expenditures
  · Going Concern
  · Critical Accounting Policies
  · Off-Balance Sheet Arrangements












  27






Plan of Operations

Our plan of operations consists of:





    ·   Launch of our B2B marketing and sales efforts through the use of
        distribution partners.
    ·   Expansion of our marketing and sales efforts through the use of social
        media, Internet marketing, print advertising, promotions, and signage
    ·   Raise capital, fund administrative infrastructure and ongoing operations
        until our operations generate positive cash flow.




How We Generate Revenue

On January 19, 2019 (date of formation), the Company adopted Accounting Standards Codification ASC 606 ("ASC 606"), Revenue from Contracts with Customers. Results for the reporting periods beginning on January 19, 2019 (date of formation) are presented under ASC 606.





The Company generates all of its revenue from contracts with customers. The
Company recognizes revenue when we satisfy a performance obligation by
transferring control of the promised services to a customer in an amount that
reflects the consideration that we expect to receive in exchange for those
services. The Company determines revenue recognition through the following
steps:



    1.  Identification of the contract, or contracts, with a customer.
    2.  Identification of the performance obligations in the contract.
    3.  Determination of the transaction price.
    4.  Allocation of the transaction price to the performance obligations in the
        contract
    5.  Recognition of revenue when, or as, we satisfy a performance obligation.

At contract inception, the Company assesses the services promised in our contracts with customers and identifies a performance obligation for each promise to transfer to the customer a service (or bundle of services) that is distinct. To identify the performance obligations, the Company considers all of the services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. The Company allocates the entire transaction price to a single performance obligation.

A description of our principal revenue generating activities are as follows:

Other sales - The Company offers consumer products through its online websites. During the years ended December 31, 2021 and 2020, the Company recorded retail sales of $3,750,519 (included in discontinued operations) and $4,620,105 (included in discontinued operations), respectively.

Mask sales - As a result of the COVID 19 pandemic, in 2020, the Company entered into the sale of KN95 masks but had to dispose of them at a loss. During the years ended December 31, 2021 and 2020, the Company recorded mask sales of $0 (included in discontinued operations) and $3,054,201 (included in discontinued operations), respectively.

The Company evaluates whether it is appropriate to record the gross amount of product sales and related costs, or the net amount earned as commissions. Generally, when the Company is primarily obligated in a transaction, are subject to inventory risk, have latitude in establishing prices and selecting suppliers, or have several but not all of these indicators, revenue is recorded at the gross sale price. The Company generally records the net amounts as commissions earned if we are not primarily obligated and do not have latitude in establishing prices.

Revenue is recognized when the product is shipped to the customer, provided that collection of the resulting receivable is reasonably assured. The Company primarily provides for no credit terms as it collects a deposit of 50% upon order and requires the remaining 50% be paid before the order is shipped. When credit terms are granted, terms of up to 120 days are provided, based on credit evaluations. No allowance has been provided for uncollectible accounts. Management has evaluated the receivables and believes they are collectible based on the nature of the receivables, historical experience of credit losses, and all other currently available evidence. Discounts are recorded as a reduction of the transaction price. Revenue excludes any amounts collected on behalf of third parties, including sales taxes.









  28






Results of Operations.

The results of operations are based on preparation of financial statements in conformity with accounting principles generally accepted in the United States. The preparation of financial statements requires management to select accounting policies for critical accounting areas as well as estimates and assumptions that affect the amounts reported in the financial statements. The Company's accounting policies are more fully described in Note 3 to the Notes of Financial Statements.

Results of Operations for the Years Ended December 31, 2021 and December 31, 2020

Thunder Energies - Continuing Operations





                                   Year Ended              Year Ended
                                December 31, 2021       December 31, 2020

Net revenues                   $                 -     $                 -
Cost of sales                                    -                       -
Gross Profit                                     -                       -
Operating expenses                               -                       -
Other expense                            1,136,288                 505,973

Net loss before income taxes $ (1,136,288 ) $ (505,973 )






Net Revenues

For the years ended December 31, 2021 and 2020, we had no revenues.





Cost of Sales

For the years ended December 31, 2021 and 2020, we had no cost of sales as we had no revenues.





Operating Expenses

For the years ended December 31, 2021 and 2020, we had no operating expenses.





Other Expense

Other expense for the year ended December 31, 2021 totaled $1,136,288 primarily due to interest expense in conjunction with debt discount of $509,950, the change in derivative liability of $40,776, interest expense on notes payable of $1,288,912, and gain on extinguishment of debt of $621,798. Other expense for the year ended December 31, 2020 totaled $505,973 primarily due to interest expense in conjunction with debt discount of $187,293, the change in derivative liability of $21,445, interest expense on notes payable of $299,506, other expense of $56,500, and other income of $58,771.

Net loss before income taxes and discontinued operations

Net loss before income taxes and discontinued operations for the years ended December 31, 2021 and 2020 totaled $1,136,288 and $505,973 primarily due other expense as described above.











  29






Financial Condition.



Total Assets.

Assets were $0 as of December 31, 2021.





Total Liabilities.

Liabilities were $2,583,421 as of December 31, 2021. Liabilities consisted primarily of accounts payable of $70,971, derivative liability of $83,404, accrued interest of $1,019,156, convertible notes payable of $508,890, net of unamortized debt discount of $241,876, and current liabilities of discontinued operations of $901,000.

Nature Consulting, LLC - Discontinued Operations





                                   Year Ended              Year Ended
                                December 31, 2021       December 31, 2020

Net revenues                   $         3,750,519     $         7,674,306
Cost of sales                            1,574,770               4,507,865
Gross Profit                             2,175,749               3,166,441
Operating expenses                       2,397,288               3,164,276
Other expense                               14,723                  46,794
Net loss before income taxes   $          (236,262 )   $           (44,629 )




Net Revenues

Net revenues decreased by $3,923,787, or 51.1%, to $3,750,519 for the year ended December 31, 2021 from $7,674,306 for the year ended December 31, 2020. The decrease in revenue is primarily the result of a decrease in mask sales of $3,054,201, or 100.0%, to $0 for the year ended December 31, 2021 from $3,054,201 for the year ended December 31, 2020, and a decrease in customer purchases of our other products of $869,586 or 18.8%, to $3,750,519 for the year ended December 31, 2021 from $4,620,105 for the year ended December 31, 2020. As a result of the COVID 19 pandemic, in 2020, the Company entered into the sale of KN95 masks but had to dispose of them at a loss.





Cost of Sales

Cost of sales decreased by $2,933,095, or 65.1%, to $1,574,770 for the year ended December 31, 2021 from $4,507,865 for the year ended December 31, 2020. As a percentage of revenue, other products cost of sales was 42.0% and 27.4% resulting in a gross margin of 58.0% and 72.6% for the years ended December 31, 2021 and 2020, respectively, primarily due to increased cost of retail products and the decrease in revenue. As a percentage of revenue, mask cost of sales was 0% and 106.2% resulting in a gross margin of 0% and (6.2)% for the years ended December 31, 2021 and 2020, respectively, primarily due to the sales of masks at a loss. In October 2020, the Company began to record direct labor to cost of sales. Prior to that, direct labor of approximately $320,000 was recorded as an operating expense. In addition, in 2021, the Company recorded approximately $170,000 of product associated with the Complaint Against Certain Former Officers and Other Parties whereby the product was recorded as cost of sales with no associated revenues.





Operating Expenses

Operating expenses decreased by $766,988, or 24.2%, to $2,397,288 for the year ended December 31, 2021 from $3,164,276 for the year ended December 31, 2020 primarily due to decreases in marketing costs of $474,608, consulting costs of $159,398, investor relations costs of $2,200, compensation costs of $173,919, travel expenses of $52,344, professional fees of $14,794, operating lease costs of $80,222, and general and administration costs of $1,502, offset primarily by shipping charges of $38,177, bad debts of $118,657 and depreciation and amortization costs of $35,165, as a result of organizing our administrative infrastructure, primarily employee costs, and focusing our marketing initiatives to generate sales growth.

For the year ended December 31, 2021, we had marketing expenses of $392,171 and general and administrative expenses of $2,005,217, primarily due to compensation costs of $845,818, consulting costs of $49,908, travel expenses of $15,194, operating lease costs of $102,280, professional fees of $290,264, depreciation and amortization costs of $52,714, bad debt expenses of $133,007, investor relations costs of $1,200, shipping charges of $239,539, and general and administration costs of $275,193 as a result of reorganizing our administrative infrastructure due to refocusing our personnel and marketing initiatives to generate anticipated sales growth.

For the year ended December 31, 2020, we had marketing expenses of $866,779 and general and administrative expenses of $2,297,497, primarily due to compensation costs of $1,019,737, consulting costs of $209,306, travel expenses of $67,538, operating lease costs of $182,502, professional fees of $305,058, depreciation and amortization costs of $17,549, bad debt expenses of $14,350, investor relations costs of $3,400, shipping charges of $201,362, and general and administration costs of $276,695 as a result of reorganizing our administrative infrastructure due to refocusing our personnel and marketing initiatives to generate anticipated sales growth.





Other Expense

Other expense for the year ended December 31, 2021 totaled $14,723 primarily due to interest expense on notes payable of $19,672, impairment of assets of $195,347, and other income of $200,296. Other expense for the year ended December 31, 2020 totaled $46,794 primarily due to interest expense on notes payable of $60,156, other expense of $5,350, and other income of $18,712.

Net loss before income taxes and discontinued operations

Net loss before income taxes and discontinued operations for the year ended December 31, 2021 totaled $236,262 primarily due to revenue of $3,750,519 and (increases/decreases) in compensation costs, professional fees, consulting costs, marketing costs, operating lease costs, shipping charges, travel costs, bad debts, and general and administration costs compared to a net loss of $44,629 for the year ended December 31, 2020 primarily due to revenue of $7,674,306 and (increases/decreases) in compensation costs, professional fees, consulting costs, marketing costs, operating lease costs, depreciation and amortization, investor relations costs, bad debts, shipping charges, travel costs, and general and administration costs.





Financial Condition.



Total Assets.

Assets were $0 as of December 31, 2021.





Total Liabilities.

Liabilities were $821,171 as of December 31, 2021. Liabilities consisted primarily of accounts payable of $386,130, due to related party of $72,743, customer advance payments of $203,518, short term notes payable of $149,490, and accrued interest of $9,290.

Liquidity and Capital Resources.

General - Overall, we had a decrease in cash flows of $97,503 in the year ended December 31, 2021 resulting from cash provided by operating activities of $164,001, cash used in investing activities of $15,337, and cash used in financing activities of $162,950.

The following is a summary of our cash flows provided by (used in) operating, investing, and financing activities during the periods indicated:





                                      Year Ended              Year Ended
                                   December 31, 2021       December 31, 2020

Net cash provided by (used in):
Operating activities              $            80,784     $           229,432
Investing activities                          (15,337 )              (240,225 )
Financing activities                         (162,950 )                72,236
Net increase in cash              $           (97,503 )   $            61,443

Years Ended December 31, 2021 Compared to the Year Ended December 31, 2020

Cash Flows from Operating Activities- For the year ended December 31, 2021, net cash provided by operating activities was $80,784. Net cash used in operations was primarily due to a net loss of $1,372,550, and the changes in operating assets and liabilities of $1,557,897, primarily due to the net changes in customer advance payments of $318,740 and other current liabilities of $26,062, offset primarily by the change in accounts receivable of $68,403, inventories of $32,161, prepaid expenses of $189,550, accounts payable of $304,954, and accrued interest of $1,307,631. In addition, net cash provided by operating activities was offset primarily by adjustments to reconcile net profit from the accretion of the debt discount of $509,950, change in derivative liability of $40,776, depreciation expense of $44,959, amortization expense of $7,755, impairment of assets of $195,347, the gain on extinguishment of debt of $621,798, and the forgiveness of PPP loan of $200,000.

For the year ended December 31, 2020, net cash provided by operating activities was $229,432. Net cash used in operations was primarily due to a net loss of $550,602, and the changes in operating assets and liabilities of $579,286, primarily due to the net changes in customer advance payments of $448,422, accrued interest of $359,562, accounts receivable of $42,608, and other current liabilities of $71,703, offset primarily by the change in inventories of $111,106, prepaid expenses of $126,168, other current assets of $24,799, accounts payable of $80,936. In addition, net cash provided by operating activities was offset primarily by adjustments to reconcile net profit from the accretion of the debt discount of $187,293, change in derivative liability of $21,445, common stock issued for services of $33,232, depreciation expense of $11,854, amortization expense of $5,695, and the gain on conversion of convertible notes payable of $58,771.

Cash Flows from Investing Activities- For the year ended December 31, 2021, net cash used in investing activities was $15,337 due to purchases of equipment. For the year ended December 31, 2020, net cash used in investing activities was $240,225 due to purchases of intangible assets and equipment.

Cash Flows from Financing Activities- For the year ended December 31, 2021, net cash used in financing activities was $162,950 due to proceeds from PPP loan payable of $200,000, repayments from loan payable to shareholder of $68,405, repayments of short term notes payable of $51,545, and repayments of short term notes payable - related party of $243,000. For the year ended December 31, 2020, net cash provided by financing activities was $72,236 due to proceeds from loan payable to shareholder of $110,868, repayments from loan payable to shareholder of $42,463, proceeds from short term notes payable of $201,035, repayments of short term notes payable of $20,000, proceeds from short term notes payable - related party of $284,744, repayments of short term notes payable - related party of $549,257, the proceeds from convertible notes payable of $820,000, and non-cash acquisition of $732,691.

Financing - We anticipate that our future liquidity requirements will arise from the need to fund our growth from operations, pay current obligations and future capital expenditures. The primary sources of funding for such requirements are expected to be cash generated from operations and raising additional funds from the private sources and/or debt financing. However, we can provide no assurances that we will be able to generate sufficient cash flow from operations and/or obtain additional financing on terms satisfactory to us, if at all, to remain a going concern. Our continuation as a going concern is dependent upon our ability to generate sufficient cash flow to meet our obligations on a timely basis and ultimately to attain profitability. Our Plan of Operation for the next twelve months is to raise capital to implement our strategy. We do not have the necessary cash and revenue to satisfy our cash requirements for the next twelve months. We cannot guarantee that additional funding will be available on favorable terms, if at all. If adequate funds are not available, then we may not be able to expand our operations. If adequate funds are not available, we believe that our officers and directors will contribute funds to pay for some of our expenses. However, we have not made any arrangements or agreements with our officers and directors regarding such advancement of funds. We do not know whether we will issue stock for the loans or whether we will merely prepare and sign promissory notes. If we are forced to seek funds from our officers or directors, we will negotiate the specific terms and conditions of such loan when made, if ever. Although we are not presently engaged in any capital raising activities, we anticipate that we may engage in one or more private offering of our company's securities after the completion of this offering. We would most likely rely upon the transaction exemptions from registration provided by Regulation D, Rule 506 or conduct another private offering under Section 4(2) of the Securities Act of 1933. See "Note 2 - Going Concern" in our financial statements for additional information as to the possibility that we may not be able to continue as a "going concern."

We are not aware of any trends or known demands, commitments, events or uncertainties that will result in or that are reasonably likely to result in material increases or decreases in liquidity.





Due to Former Shareholder





Loans Payable



Loan Payable to Shareholder





Economic Injury Disaster Loan

Paycheck Protection Program Loan Round 1

Paycheck Protection Program Loan Round 2





Convertible Note Payable



Short Term



$85,766 Note

The Company accounts for an embedded conversion feature as a derivative under ASC 815-10-15-83 and valued separately from the note at fair value. The embedded conversion feature of the note is revalued at each subsequent reporting date at fair value and any changes in fair value will result in a gain or loss in those periods. The Company recorded a derivative liability of $82,257, recorded a change in derivative liability of $40,776 and $21,445 during the years ended December 31, 2021 and 2020, respectively.









  34






$220,000 Note

The principal balance due at December 31, 2021 is $220,000 and is presented as a short-term liability in the balance sheet.

$410,000 Note (previously $600,000)

As a result of the failure to timely file our Form 10-Q for the three-month period ended September 30, 2020, the Form 10-K for the year ended December 31, 2020, and the three-month period ended March 31, 2021, the Convertible Notes Payable were in default. On July 15, 2021, the Company entered into a Waiver Agreement (the "Agreement") waiving the default provisions listed in the Notes related to the Company's failure to timely file its Form 10-Q for the three-month period ended September 30, 2020, the Form 10-K for the year ended December 31, 2020, and the three-month period ended March 31, 2021. Therefore, no default interest has been accrued in these financial statements.









  35






April 2022 Notes

$40,000,000 Convertible Note





Investment in Fourth &One





Promissory Debenture

On October 4, 2020, SP11 converted $35,000 of its Promissory Debentures at $0.01 per share into 3,500,000 shares of the Company's common stock.





Stock Transactions

On December 6, 2021, the holder of the note converted $190,000 of the Note into 3,800,000 shares of the Company's common stock for a balance due of $410,000 at December 31, 2021 on the Note.

On October 13, 2020, the Company issued 195,480 common shares, valued at $33,232 (based on the Company's stock price on the date of issuance), to GHS Investments in settlement.

On October 4, 2020, SP11 converted $35,000 of its Promissory Debentures at $0.01 per share into 3,500,000 shares of the Company's common stock.

On August 14, 2020, the Company issued 60,000,000 common shares in conjunction with acquisition.





Employment Agreements

· $5,700 for services performed from March 1, 2022 - June 30, 2022

· Lump Sum payment of $21,299.00 for services from July 1, 2022 - December 31,

2022

· 25,000,000 shares of TNRG common stock or in the Company which vest

immediately.

· 7,500,000 newly issued Preferred A shares of TNRG stock CUSIP (88604Y209) Cert

No. 400002

· 750 newly issued Preferred B shares of TNRG stock CUSIP (88604Y209), Cert. No.

500002

· 1,500 newly issued Preferred C shares of TNRG stock CUSIP (8860Y209), Cert No.

600002

· $7,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

· 1,500 RoRa Coins in possession of the Company.

· Ms. Tori White, Director real Estate Development.

o $24,000 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 4,800 RoRa Coins in possession of the Company.

· Mr. Eric Collins, Chairman and Chief Operations Officer.

o $12,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 2,500 RoRa Coins in possession of the Company.

· Mr. Donald Keer, Corporate Counsel

o $3,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 700 RoRa Coins in possession of the Company.

· Mr. Lance Lehr, Chief Operating Officer

o $2,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 500 RoRa Coins in possession of the Company.






Consulting Agreements

On April 6, 2022, the Company entered into a Consulting Agreement with a third party to provide consulting services to the Company. The consulting agreement is in effect until the Company is profitable with a balance sheet of over $200 million or thirty-six (36) months, whichever is longer. Under this consulting agreement, the related party will be entitled to a total of 5,000,000 common, vest immediately, valued at $150,000 (based on the Company's stock price on the date of issuance) and will be expensed over the thirty-six (36) term of the Consulting agreement.





Capital Resources.

We had no material commitments for capital expenditures as of December 31, 2021.





Fiscal year end

Our fiscal year end is December 31.





Going Concern

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. The Company had an accumulated deficit of $2,020,464 and $647,914 at December 31, 2021 and 2020, respectively, had a working capital deficit of $2,583,421 and $1,569,288 at December 31, 2021 and 2020, respectively, had a net losses of $1,372,550 and $550,602 for the years ended December 31, 2021 and 2020, with limited revenue earned since inception, no current revenue generating operations, and a lack of operational history. These matters raise substantial doubt about the Company's ability to continue as a going concern.

The Company's financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating cost and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plan to obtain such resources for the Company include, obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.

There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

The consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

Critical Accounting Policies

The Commission has defined a company's critical accounting policies as the ones that are most important to the portrayal of our financial condition and results of operations and which require us to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, we have identified the critical accounting policies and judgments addressed below. We also have other key accounting policies that are significant to understanding our results.

The following are deemed to be the most significant accounting policies affecting us.





Use of Estimates

The preparation of these financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the financial statements and the reported amounts of net sales and expenses during the reported periods. Actual results may differ from those estimates and such differences may be material to the financial statements. The more significant estimates and assumptions by management include among others: inventory valuation, common stock valuation, and the recoverability of intangibles. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions.





Revenue Recognition





The Company generates all of its revenue from contracts with customers. The
Company recognizes revenue when we satisfy a performance obligation by
transferring control of the promised services to a customer in an amount that
reflects the consideration that we expect to receive in exchange for those
services. The Company determines revenue recognition through the following
steps:



    1.  Identification of the contract, or contracts, with a customer.
    2.  Identification of the performance obligations in the contract.
    3.  Determination of the transaction price.
    4.  Allocation of the transaction price to the performance obligations in the
        contract
    5.  Recognition of revenue when, or as, we satisfy a performance obligation.

A description of our principal revenue generating activities are as follows:

The Company evaluates whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions. Generally, when the Company is primarily obligated in a transaction, are subject to inventory risk, have latitude in establishing prices and selecting suppliers, or have several but not all of these indicators, revenue is recorded at the gross sale price. The Company generally records the net amounts as commissions earned if we are not primarily obligated and do not have latitude in establishing prices.





Customer Advanced Payments

Customer advanced payments consists of customer orders paid in advance of the delivery of the order. Customer advanced payments are classified as short-term as the typical order ships within approximately three weeks of placing the order. Customer advanced payments are recognized as revenue when the product is shipped to the customer and all other revenue recognition criteria have been met. Customer advanced payments as of December 31, 2021 and 2020 were $203,518 (included in discontinued operations) and $522,258 (included in discontinued operations), respectively. Customer advanced payments are included in current liabilities in the accompanying condensed consolidated Balance Sheets. The Company's ability to fulfill these orders have been impaired (see Note 1).





Inventories

The Company manufactures its own products, made to order, and when completed are shipped to the customer. The Company's inventories are valued by the first-in, first-out ("FIFO") cost method and are stated at the lower of cost or net realizable value. The Company had inventories of $0 (included in discontinued operations) and $168,470 (included in discontinued operations), respectively, consisting of mostly finished goods as of December 31, 2021 and 2020, respectively. See Note 1 for impairment discussion as of December 31, 2021.





Intangible Assets

Intangible assets consist primarily of developed technology - website. Our intangible assets are being amortized on a straight-line basis over a period of three years.

Impairment of Long-lived Assets

We periodically evaluate whether the carrying value of property, equipment and intangible assets has been impaired when circumstances indicate the carrying value of those assets may not be recoverable. The carrying amount is not recoverable if it exceeds the sum of the discounted cash flows expected to result from the use and eventual disposition of the asset. If the carrying value is not recoverable, the impairment loss is measured as the excess of the asset's carrying value over its fair value. There are no impairments as of December 31, 2020. See Note 1 for impairment discussion as of December 31, 2021.

Our impairment analyses require management to apply judgment in estimating future cash flows as well as asset fair values, including forecasting useful lives of the assets, assessing the probability of different outcomes, and selecting the discount rate that reflects the risk inherent in future cash flows. If the carrying value is not recoverable, we assess the fair value of long-lived assets using commonly accepted techniques, and may use more than one method, including, but not limited to, recent third-party comparable sales and discounted cash flow models. If actual results are not consistent with our assumptions and estimates, or our assumptions and estimates change due to new information, we may be exposed to an impairment charge in the future.





Income Taxes

As a result of the Company's Interest Purchase Agreement, the Company converted to a corporation ("Conversion"). Beginning on August 14, 2020, the Company's results of operations are taxed as a C Corporation. Prior to the Conversion, the Company's operations were taxed as a limited liability company, whereby the Company elected to be taxed as a partnership and the income or loss was required to be reported by each respective member on their separate income tax returns. Therefore, no provision for income taxes has been provided in the accompanying consolidated financial statements for periods prior to August 14, 2020.

The computation of income taxes included in the Statements of Operations, represents the tax effects that would have been reported had the Company been subject to U.S. federal and state income taxes as a corporation for all periods presented. Taxes are based upon the statutory income tax rates and adjustments to income for estimated permanent differences occurring during each period. Actual rates and expenses could have differed had the Company actually been subject to U.S. federal and state income taxes for all periods presented.

We account for income taxes under an asset and liability approach. This process involves calculating the temporary and permanent differences between the carrying amounts of the assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The temporary differences result in deferred tax assets and liabilities, which would be recorded on our balance sheets in accordance with ASC 740, which established financial accounting and reporting standards for the effect of income taxes. We must assess the likelihood that its deferred tax assets will be recovered from future taxable income and, to the extent we believe that recovery is not likely, we must establish a valuation allowance. Changes in our valuation allowance in a period are recorded through the income tax provision on the consolidated Statements of Operations.

From the date of our inception, we adopted ASC 740-10-30. ASC 740-10 clarifies the accounting for uncertainty in income taxes recognized in an entity's financial statements and prescribes a recognition threshold and measurement attributes for financial statement disclosure of tax positions taken or expected to be taken on a tax return. Under ASC 740-10, the impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. Additionally, ASC 740-10 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. As a result of the implementation of ASC 740-10, and currently, we do not have a liability for unrecognized income tax benefits.

Fair Value of Financial Instruments

The provisions of accounting guidance, FASB Topic ASC 825 requires all entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. As of December 31, 2021, the fair value of cash, accounts payable, accrued expenses, and notes payable approximated carrying value due to the short maturity of the instruments, quoted market prices or interest rates which fluctuate with market rates.





Fair Value Measurements

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, as follows:





    ·   Level 1 - Quoted prices in active markets for identical assets or
        liabilities.

    ·   Level 2 - Inputs other than Level 1 that are observable, either directly
        or indirectly, such as quoted prices for similar assets or liabilities;
        quoted prices in markets that are not active; or other inputs that are
        observable or can be corroborated by observable market data for
        substantially the full term of the assets or liabilities.

    ·   Level 3 - Unobservable inputs that are supported by little or no market
        activity and that are significant to the measurement of the fair value of
        the assets or liabilities.

The carrying value of financial assets and liabilities recorded at fair value is measured on a recurring or nonrecurring basis. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. There were no financial assets or liabilities carried and measured on a nonrecurring basis during the reporting periods. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. There have been no transfers between levels.

The derivatives are evaluated under the hierarchy of ASC 480-10, ASC Paragraph 815-25-1 and ASC Subparagraph 815-10-15-74 addressing embedded derivatives. The fair value of the Level 3 financial instruments was performed internally by the Company using the Black Scholes valuation method.

The following table summarize the Company's fair value measurements by level at December 31, 2021 for the assets measured at fair value on a recurring basis:





                        Level 1       Level 2      Level 3
Derivative liability   $       -     $       -     $ 83,404








  42

The following table summarize the Company's fair value measurements by level at December 31, 2020 for the assets measured at fair value on a recurring basis:





                        Level 1       Level 2       Level 3
Derivative liability   $       -     $       -     $ 124,180

The carrying values of the Company's financial instruments, including cash, other current assets, accounts payable, accruals, and other current liabilities approximate their fair values due to the short period of time to maturity or repayment.





Debt

We issue debt that may have separate warrants, conversion features, or no equity-linked attributes.

Debt with warrants - When we issue debt with warrants, we treat the warrants as a debt discount, record as a contra-liability against the debt, and amortize the balance over the life of the underlying debt as amortization of debt discount expense in the consolidated statements of operations. When the warrants require equity treatment under ASC 815, the offset to the contra-liability is recorded as additional paid in capital in our consolidated balance sheet. When we issue debt with warrants that require liability treatment under ASC 815, such as a clause requiring repricing, the warrants are considered to be a derivative that is recorded as a liability at fair value. If the initial value of the warrant derivative liability is higher than the fair value of the associated debt, the excess is recognized immediately as interest expense. The warrant derivative liability is adjusted to its fair value at the end of each reporting period, with the change being recorded as expense or gain. If the debt is retired early, the associated debt discount is then recognized immediately as amortization of debt discount expense in the consolidated statement of operations. The debt is treated as conventional debt.

Convertible debt - derivative treatment- When we issue debt with a conversion feature, we must first assess whether the conversion feature meets the requirements to be treated as a derivative, as follows: a) one or more underlyings, typically the price of our common stock; b) one or more notional amounts or payment provisions or both, generally the number of shares upon conversion; c) no initial net investment, which typically excludes the amount borrowed; and d) net settlement provisions, which in the case of convertible debt generally means the stock received upon conversion can be readily sold for cash. An embedded equity-linked component that meets the definition of a derivative does not have to be separated from the host instrument if the component qualifies for the scope exception for certain contracts involving an issuer's own equity. The scope exception applies if the contract is both a) indexed to its own stock; and b) classified in shareholders' equity in its statement of financial position.

If the conversion feature within convertible debt meets the requirements to be treated as a derivative, we estimate the fair value of the convertible debt derivative using the Black Scholes method upon the date of issuance. If the fair value of the convertible debt derivative is higher than the face value of the convertible debt, the excess is immediately recognized as interest expense. Otherwise, the fair value of the convertible debt derivative is recorded as a liability with an offsetting amount recorded as a debt discount, which offsets the carrying amount of the debt. The convertible debt derivative is revalued at the end of each reporting period and any change in fair value is recorded as a gain or loss in the statement of operations. The debt discount is amortized through interest expense over the life of the debt.

Convertible debt - beneficial conversion feature - If the conversion feature is not treated as a derivative, we assess whether it is a beneficial conversion feature ("BCF'). A BCF exists if the conversion price of the convertible debt instrument is less than the stock price on the commitment date. This typically occurs when the conversion price is less than the fair value of the stock on the date the instrument was issued. The value of a BCF is equal to the intrinsic value of the feature, the difference between the conversion price and the common stock into which it is convertible and is recorded as additional paid in capital and as a debt discount in the consolidated balance sheet. We amortize the balance over the life of the underlying debt as amortization of debt discount expense in the statement of operations. If the debt is retired early, the associated debt discount is then recognized immediately as amortization of debt discount expense in the statement of operations.

If the conversion feature does not qualify for either the derivative treatment or as a BCF, the convertible debt is treated as traditional debt.





Discontinued Operations

As a result of the October 14, 2021 Complaint filed against Defendants, the Company determined that Nature Consulting LLC would be accounted as a discontinued operation pursuant to ASC 205-20 Discontinued Operations. In determining whether a group of assets that is disposed (or to be disposed) should be presented as a discontinued operation, we analyzed whether the group of assets being disposed represents a component of the Company; that is, whether it had historic operations and cash flows that were clearly distinguished, both operationally and for financial reporting purposes. In addition, we considered whether the disposal represents a strategic shift that has or will have a major effect on our operations and financial results. The results of discontinued operations, as well as any gain or loss on the disposal, if applicable, are aggregated and separately presented in our consolidated statements of operations, net of income taxes. The historical financial position of discontinued operations are aggregated and separately presented in our accompanying consolidated balance sheets.

Recent Accounting Pronouncements

Refer to Note 3 in the accompanying notes to the consolidated financial statements.

Future Contractual Obligations and Commitments

Refer to Note 3 in the accompanying notes to the consolidated financial statements for future contractual obligations and commitments. Future contractual obligations and commitments are based on the terms of the relevant agreements and appropriate classification of items under U.S. GAAP as currently in effect. Future events could cause actual payments to differ from these amounts.

We incur contractual obligations and financial commitments in the normal course of our operations and financing activities. Contractual obligations include future cash payments required under existing contracts, such as debt and lease agreements. These obligations may result from both general financing activities and from commercial arrangements that are directly supported by related operating activities. Details on these obligations are set forth below.

Due to Former Shareholder - discontinued operations





Loans Payable

Loan Payable to Shareholder - discontinued operations

Economic Injury Disaster Loan - discontinued operations

Paycheck Protection Program Loan Round 1 - discontinued operations

Paycheck Protection Program Loan Round 2 - discontinued operations





Convertible Note Payable



$85,766 Note

The Company accounts for an embedded conversion feature as a derivative under ASC 815-10-15-83 and valued separately from the note at fair value. The embedded conversion feature of the note is revalued at each subsequent reporting date at fair value and any changes in fair value will result in a gain or loss in those periods. The Company recorded a derivative liability of $82,257, recorded a change in derivative liability of $40,776 and $21,445 during the years ended December 31, 2021 and 2020, respectively.









  46






$220,000 Note

The principal balance due at December 31, 2021 is $220,000 and is presented as a short-term liability in the balance sheet.

$410,000 Note (previously $600,000)

As a result of the failure to timely file our Form 10-Q for the three-month period ended September 30, 2020, the Form 10-K for the year ended December 31, 2020, and the three-month period ended March 31, 2021, the Convertible Notes Payable were in default. On July 15, 2021, the Company entered into a Waiver Agreement (the "Agreement") waiving the default provisions listed in the Notes related to the Company's failure to timely file its Form 10-Q for the three-month period ended September 30, 2020, the Form 10-K for the year ended December 31, 2020, and the three-month period ended March 31, 2021. Therefore, no default interest has been accrued in these financial statements.









  47






April 2022 Notes

In April 2022, the Company authorized convertible promissory notes ("April 2022 Notes") that pay interest at 10% per annum and are due and payable on December 31, 2022 for aggregate gross proceeds of $347,500 through July 31, 2022. The holders of the April 2022 Notes have the right, at the holder's option, to convert the principal amount of this note, in whole or in part, plus any interest which accrues hereon, into fully paid and nonassessable shares at a conversion price of $0.07 per share into the Company's common stock if before any public offering. The Note includes customary events of default, including, among other things, payment defaults and certain events of bankruptcy. If such an event of default occurs, the holders of the Note may be entitled to take various actions, which may include the acceleration of amounts due under the Note and accrual of interest as described above.

$40,000,000 Convertible Note





Investment in Fourth &One





Promissory Debenture

On October 4, 2020, SP11 converted $35,000 of its Promissory Debentures at $0.01 per share into 3,500,000 shares of the Company's common stock.





Employment Agreements

· $5,700 for services performed from March 1, 2022 - June 30, 2022

· Lump Sum payment of $21,299.00 for services from July 1, 2022 - December 31,

2022

· 25,000,000 shares of TNRG common stock in the Company which vest immediately.

· 7,500,000 newly issued Preferred A shares of TNRG stock CUSIP (88604Y209) Cert

No. 400002

· 750 newly issued Preferred B shares of TNRG stock CUSIP (88604Y209), Cert. No.

500002

· 1,500 newly issued Preferred C shares of TNRG stock CUSIP (8860Y209), Cert No.

600002

· $7,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

· 1,500 RoRa Coins in possession of the Company.

· Ms. Tori White, Director real Estate Development.

o $24,000 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 4,800 RoRa Coins in possession of the Company.

· Mr. Eric Collins, Chairman and Chief Operations Officer.

o $12,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 2,500 RoRa Coins in possession of the Company.

· Mr. Donald Keer, Corporate Counsel

o $3,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 700 RoRa Coins in possession of the Company.

· Mr. Lance Lehr, Chief Operating Officer

o $2,500 loan forgiveness cancelling debt used for the acquisition of shares in

the Company.

o 500 RoRa Coins in possession of the Company.












  49






Consulting Agreements

On April 6, 2022, the Company entered into a Consulting Agreement with a third party to provide consulting services to the Company. The consulting agreement is in effect until the Company is profitable with a balance sheet of over $200 million or thirty-six (36) months, whichever is longer. Under this consulting agreement, the related party will be entitled to a total of 5,000,000 common, vest immediately, valued at $150,000 (based on the Company's stock price on the date of issuance) and will be expensed over the thirty-six (36) term of the Consulting agreement.

Off-Balance Sheet Arrangements

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





Inflation

We do not believe that inflation has had a material effect on our results of operations.

Delayed OTC Markets Other stock markets 12:01:35 2024-05-16 pm EDT			5-day change	1st Jan Change
0.05 ^USD	+61.29%		0.00%	+90.84%

May. 14	Thunder Energies Corporation Reports Earnings Results for the First Quarter Ended March 31, 2024	CI
Apr. 15	Thunder Energies Corporation Reports Earnings Results for the Full Year Ended December 31, 2023	CI

Thunder Energies Corporation Reports Earnings Results for the First Quarter Ended March 31, 2024	May. 14	CI
Thunder Energies Corporation Reports Earnings Results for the Full Year Ended December 31, 2023	Apr. 15	CI
Thunder Energies Corporation Reports Earnings Results for the Third Quarter and Nine Months Ended September 30, 2023	Nov. 14	CI
Thunder Energies Corporation Enters into a Land Purchase and Sale Agreement to Acquire 65.9 Acres of Land for Development in Commerce, Georgia	23-10-26	CI
Thunder Energies Corporation Reports Earnings Results for the Second Quarter and Six Months Ended June 30, 2023	23-08-21	CI
Thunder Energies Corporation Reports Earnings Results for the First Quarter Ended March 31, 2023	23-05-15	CI
Thunder Energies Corporation Reports Earnings Results for the Full Year Ended December 31, 2022	23-03-31	CI
Thunder Energies Corporation Auditor Raises 'Going Concern' Doubt	23-03-30	CI
Thunder Energies Partners With Las Vegas Aces of WNBA	22-12-20	CI
Thunder Energies Corporation Reports Earnings Results for the Third Quarter and Nine Months Ended September 30, 2022	22-12-14	CI
Thunder Energies Corporation Reports Earnings Results for the Second Quarter and Six Months Ended June 30, 2022	22-12-08	CI
Thunder Energies Corporation Reports Earnings Results for the First Quarter Ended March 31, 2022	22-11-29	CI
Thunder Energies Corporation Reports Earnings Results for the Full Year Ended December 31, 2021	22-10-18	CI
Thunder Energies Corporation Auditor Raises 'Going Concern' Doubt	22-10-17	CI
Thunder Energies Corporation Announces Executive Changes	22-04-19	CI
Thunder Energies Corporation Announces Executive Changes	22-04-19	CI
Thunder Energies Corporation Reports Earnings Results for the Third Quarter and Nine Months Ended September 30, 2021	21-11-22	CI
Thunder Energies Corporation Reports Earnings Results for the Full Year Ended December 31, 2020	21-08-02	CI
Thunder Energies Corporation Announces Sales Results for the Third Quarter and Year to Date Ending September 30, 2020	20-10-28	CI
Thunder Energies Corporation Announces Earnings Results for the Eight Month Period Ending August 31, 2020	20-09-10	CI
Nature Consulting, LLC acquired Thunder Energies Corporation in a reverse merger transaction for $14.7 million.	20-08-13	CI

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Thunder Energies Corporation

Equities

TNRG

US88604Y2090

Investment Management & Fund Operators

THUNDER ENERGIES CORP Management's Discussion and Analysis of Financial Condition and Results of Operations. (form 10-K)

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