S-1

Registration No. 333-              

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-1

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

TRAQIQ, INC.

(Exact name of registrant as specified in its charter)

California	7371	30-0580318
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification code number)	(I.R.S. Employer Identification No.)

4205 SE 36th Street, Suite 100

Bellevue, WA 98006

(425) 818-0560

(Address, including zip code, and telephone number, including area code, of principal executive offices)

Ajay Sikka

4205 SE 36th Street, Suite 100

Bellevue, WA 98006

(425) 818-0560

(Name, address, including zip code, and telephone number, including area code, of agent for service)

With copies to:

Alan W. Becker, Esq.	Gregory Sichenzia, Esq.
Bose McKinney & Evans LLP	Sichenzia Ross Ference LLP
110 Monument Circle, Suite 2700	1185 Avenue of the Americas, 31st Floor
Indianapolis, Indiana 46204	New York, New York 10036
(317) 684-5000	(212) 930-9700

Approximate date of commencement of proposed sale to public: As soon as practicable after this Registration Statement is declared effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

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

Large Accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
	Emerging growth company ☒

If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price (1)		Amount of registration fee
Common Stock, $.0001 par value(2)(3)	$	17,250,000	$	1,599.08
Underwriters’ Common Stock Purchase Warrants(4)		—		—
Shares of common stock issuable upon exercise of Underwriters’ Warrants(2)(5)		1,078,125		99.94
Total	$	18,328,125	$	1,699.02

(1)	Estimated solely for the purpose of calculating the amount of the registration fee in accordance with Rule 457(o) under the Securities Act of 1933, as amended (the “Securities Act”).
(2)	Pursuant to Rule 416, the securities being registered include such indeterminate number of additional securities as may be issued after the date hereof as a result of stock splits, stock dividends or similar transactions.
(3)	Includes shares of common stock which may be issued upon exercise of a 45-day option granted to the underwriters to cover over-allotments, if any, equal to 15% of the number of shares sold in the offering.
(4)	In accordance with Rule 457(g) under the Securities Act, because the shares of the Registrant’s common stock underlying the warrants are registered hereby, no separate registration fee is required with respect to the warrants registered hereby.
(5)	The Underwriters’ Warrants are exercisable at a per share exercise price equal to 125% of the public offering price per share of common stock. The proposed maximum offering price of the Underwriters’ Warrants is $1,078,125, which is equal to 125% of $862,500 (5% of $17,250,000 which is the maximum offering price).

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED __________, 2021

__________ Shares

Common Stock

TraQiQ, Inc.

We are offering an aggregate of ______ shares of our common stock, $0.0001 par value per share. We assume a public offering price of $_____ per share of our common stock which was the last reported sale price of our common stock on the OTCQB on _______________, 2021.

Our common stock is presently quoted on the OTCQB marketplace under the symbol “TRIQ”. We have applied to have our common stock listed on the Nasdaq Global Market under the symbol “TRIQ”. No assurance can be given that our application will be approved. If our application is not approved, we will not complete this offering. On _________, 2021, the last reported sale price for our common stock on the OTCQB market was $_____ per share. All share and per-share information, as well as all financial information, contained in this prospectus has been adjusted to give effect to the one-for-__ (1-for-___) reverse stock split, which was implemented on ________, 2021 and effective at the commencement of trading of our common stock on _________, 2021.

The final public offering price per share will be determined through negotiation between us and the underwriter in this offering and will take into account the recent market price of our common stock, the general condition of the securities market at the time of this offering, the history of, and the prospects for, the industry in which we compete, and our past and present operations and our prospects for future revenues. The recent market price used throughout this prospectus may not be indicative of the public offering price per share. Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page 6 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

	Per Share	Total
Public offering price	$	$
Underwriting discounts and commissions (1)	$	$
Proceeds to us, before expenses	$	$

(1) Does not include a non-accountable expense allowance equal to 1% of the gross proceeds of this offering payable to the underwriters. See “Underwriting” for a description of compensation payable to the underwriters.

We have granted a 45-day option to the representative of the underwriters to purchase up to     additional shares of our common stock, solely to cover over-allotments, if any.

The underwriters expect to deliver our shares to purchasers in the offering on or about _________, 2021.

ThinkEquity

The date of this prospectus is ____________, 2021

 

 

 

TABLE OF CONTENTS

	Page
Prospectus Summary	1
Risk Factors	6
Use of Proceeds	12
Market for Our Common Stock and Related Stockholder Matters	13
Capitalization	14
Dilution	15
Cautionary Note Regarding Forward-Looking Statements	16
Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Business	28
Directors and Executive Officers	34
Executive Compensation	38
Security Ownership of Certain Beneficial Owners and Management	40
Certain Relationships and Related Party Transactions	41
Description of Capital Stock	42
Underwriting	45
Legal Matters	53
Experts	53
Where You Can Find More Information	53
Index to Consolidated Financial Statements	F-1

You should rely only on information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with additional information or information different from that contained in this prospectus. We are not making an offer of these securities in any state or other jurisdiction where the offer is not permitted. The information in this prospectus may only be accurate as of the date on the front of this prospectus regardless of time of delivery of this prospectus or any sale of our securities.

No person is authorized in connection with this prospectus to give any information or to make any representations about us, the common stock hereby or any matter discussed in this prospectus, other than the information and representations contained in this prospectus. If any other information or representation is given or made, such information or representation may not be relied upon as having been authorized by us. This prospectus does not constitute an offer to sell, or a solicitation of an offer to buy our common stock in any circumstance under which the offer or solicitation is unlawful. Neither the delivery of this prospectus nor any distribution of our common stock in accordance with this prospectus shall, under any circumstances, imply that there has been no change in our affairs since the date of this prospectus.

Neither we nor the underwriters have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than the United States. You are required to inform yourself about, and to observe any restrictions relating to, this offering and the distribution of this prospectus.

PROSPECTUS SUMMARY

This summary highlights selected information appearing elsewhere in this prospectus. While this summary highlights what we consider to be important information about us, you should carefully read this entire prospectus before investing in our common stock, especially the risks and other information we discuss under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and our consolidated financial statements and related notes beginning on page F-1. Our fiscal year end is December 31 and our fiscal years ended December 31, 2019, and 2020 are sometimes referred to herein as fiscal years 2019, and 2020, respectively. Some of the statements made in this prospectus discuss future events and developments, including our future strategy and our ability to generate revenue, income and cash flow. These forward-looking statements involve risks and uncertainties which could cause actual results to differ materially from those contemplated in these forward-looking statements. See “Cautionary Note Regarding Forward-Looking Statements”. Unless otherwise indicated or the context requires otherwise, the words “we,” “us,” “our”, the “Company” or “our Company” or TraQiQ” refer to TraQiQ, Inc., a California corporation, and our wholly owned subsidiaries, TraQiQ Solutions, Inc., TraQiQ Solutions, Pvt Ltd, Rohuma, LLC, Rohuma India Info Solutions Private Limited and Mimo-Technologies Pvt Ltd.

Except as otherwise indicated in this prospectus, all common stock and per share information and all exercise and conversion prices with respect to securities exercisable or convertible into our common stock reflect, on a retroactive basis, a 1-for-___ reverse stock split of our common stock, which became effective on _______, 2021. This prospectus assumes the over-allotment option of the underwriters has not been exercised, unless otherwise indicated.

Overview of the Company

With operations concentrated in India, Southeast Asia and Latin America, we help businesses in emerging markets leverage the “gig” or task economy by providing both technology solutions and a network of workers required to fulfill those tasks. We provide software as a service that enables clients to build and manage a network of contract task workers. This platform can also be used by business clients to manage their employees who are performing services, such as PC repair or food delivery. In addition, our Mimo service operates a network of over 14,000 task workers in India who make deliveries, collect payments, do background verifications, and fulfill tasks across the supply chain, as needed by business clients to deliver their products and services to their respective markets and customers.

Our TraQSuite software platform powers the last mile distribution network, allowing business users to target customers, facilitate and validate transactions, track and manage task workers, manage funds and run a distribution network. Key features of the TraQSuite software include:

● Last Mile delivery: TraQSuite’s Last-Mile software module enables a business to manage thousands of task workers across multiple geographies to deliver products and services to the users. The software platform, operating through mobile apps, allows for data sharing, delivery validation, geo-tagging and know-your-customer (KYC) requirements and can even measure customer satisfaction.

● Transact: TraQSuite enables task workers to facilitate transactions by meeting the end customers. They can collect payments via credit cards, smart-phone swipes, SMS messages or cash. Both banked and unbanked users can buy products and services and pay with their mobile devices.

● Target: TraQSuite enables customer transactions to be rewarded with loyalty credits, tokens or points that can be redeemed by the customer for free products, discounts and benefits. The software analyzes these transactions and purchase behaviors by using leading AI models and can deliver real time, automated and targeted offers and recommendations for additional purchases and customer retention.

The Mimo delivery and task service in India runs on the TraQSuite platform and performs deliveries and fulfills tasks for some of the largest businesses in India. Mimo provides delivery and pickup services for the banking and insurance industry, performing verifications, field investigations for loan requests, business verification, employment verification, collection of documents and customer data and assistance in filling out forms for banks. Mimo works with microfinance institutions to collect cash, such as loan payments, convert cash to digital forms such as debit cards, and conduct data collection and surveys. For consumer goods companies, Mimo does promotional marketing, last mile (hyper-local) delivery, merchant onboarding or activation, store audits, and route optimization for delivery.

Growth Strategy. Our strategy is to grow our business through a combination of organic growth and strategic investments that bring new functionality and revenue streams to the company. We plan to enhance the functionality of our existing products, increase sales in the Indian market and entry into new emerging markets. In addition to our significant presence in India, Southeast Asia and Latin America, we have recently added new customers in Australia, New Zealand and parts of Africa.

Risks Associated with our Business

An investment in our securities involves a high degree of risk. You should carefully consider the risks summarized below. The risks are discussed more fully in the “Risk Factors” section of this prospectus immediately following this prospectus summary. These risks include, but are not limited to, the following:

● We have a limited operating history and are subject to the risks encountered by early-stage companies.

● Our operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern.

● If we are unable to integrate our acquisitions or manage the growth of those companies effectively, our business could be adversely affected.

● Increasing competition within our emerging industry could have an impact on our business prospects.

● Our current and future operations are subject to certain risks that are unique to operating in a foreign country.

● Exchange rates may cause future losses in our international operations.

● We may not be able to adequately protect our proprietary technology, and our competitors may be able to offer similar products and services, which would harm our competitive position.

● If third parties claim that we infringe their intellectual property, it may result in costly litigation.

● Pandemics including COVID-19 may adversely affect our business, especially in view of our foreign operations.

Corporate History

We were incorporated as a shell company in the State of California in 2009 under the name Thunderclap Entertainment, Inc. In 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc. and since 2017 we have acquired two Indian companies and four United States companies (with one Indian subsidiary) in exchange for stock and assumption of debt.

The Company’s headquarters are located at 14205 SE 36th Street, Suite 100, Bellevue, WA 98006, and its main telephone number is (425) 818-0560. Our website address is traqiq.com. Information on our website is not part of this prospectus.

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THE OFFERING

Shares Offered (1)	________ shares of our common stock (_______ shares if the underwriters exercise their over-allotment option in full).
Common stock outstanding before
the offering	34,859,683 shares of common stock.
Common stock to be outstanding
after this offering (2)	________ shares of common stock.
Option to purchase additional shares	We have granted the underwriters a 45-day option to purchase up to ________ additional shares of our common stock to cover allotments, if any.
Use of proceeds	We intend to use the net proceeds of this offering for research and development activities, sales and marketing, engineering activities, repayment of outstanding debt and accounts payable and for general working capital purposes and possibly acquisitions of other companies, products or technologies, though no such acquisitions are currently contemplated. See “Use of Proceeds” on page 12.
Risk factors	Investing in our securities is highly speculative and involves a high degree of risk. You should carefully consider the information set forth in the “Risk Factors” section beginning on page 6 before deciding to invest in our securities.
Trading symbols	Our common stock is currently quoted on the OTCQB marketplace under the trading symbol “TRIQ”. We have applied to The Nasdaq Global Market to list our common stock under the symbol “TRIQ”.
Lock-ups	We and our directors and officers and stockholders who beneficially own five percent or more of our outstanding common stock have agreed with the underwriters not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of our common stock or securities convertible into common stock for a period of 180 days after the date of this prospectus with respect to our officers and directors, and 90 days with respect to us and stockholders who beneficially own five percent or more of our outstanding common stock. See “Underwriting” section on page 45.

(1)	Based on the assumed public offering price of $_____ per share, based on the closing price on _________, 2021. The actual number of shares we will offer will be determined based on the actual public offering price.
(2)	The shares of common stock to be outstanding after this offering is based on 34,859,683 shares outstanding as of the date of this prospectus.

Nasdaq listing requirements include, among other things, a stock price threshold. As a result, on __________, 2021 we filed Articles of Amendment to our Articles of Incorporation to effectuate a 1-for-___ reverse stock split. On _________, 2021, the reverse stock split was effected on the OTCQB.

The shares of common stock to be outstanding after this offering excludes the following:

● 1,570,000 shares remaining for issuance pursuant to the 2020 Equity Incentive Plan;

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● 3,930,000 shares issuable upon exercise of outstanding options with a weighted average exercise price of $0.0052;

● 2,277,684 shares issuable upon exercise of outstanding warrants with a weighted average exercise price of $0.001 which were issued in connection with acquisitions, of which 1,730,669 are currently exercisable and 547,016 are contingent upon achievement of future revenue targets;

● 536,276 shares issuable upon exercise of outstanding warrants which were issued in connection with a financing, 357,517 additional shares issuable upon exercise of warrants we are committed to issue in connection with that financing within three days after filing the registration statement of which this prospectus is a part, and 178,326 shares issuable upon exercise of warrants that will be issued at the election of our lenders in the future as a part of that financing, all at an exercise price of $1.45;

● 1,729,943 shares issuable in connection with a completed acquisition contingent upon achievement of future revenue targets;

● 413,793 shares of common stock issuable upon conversion at a conversion price of $1.45 of an outstanding convertible note from a financing, 275,862 additional shares issuable upon conversion at a conversion price of $1.45 of a convertible note we are committed to issue in connection with that financing within three days after filing the registration statement of which this prospectus is a part, and 137,931 shares issuable upon conversion at a conversion price of $1.45 of a convertible note that will be issued at the election of our lenders in the future as a part of that financing; and

● ________ shares of common stock issuable upon conversion of outstanding convertible notes with a weighted average conversion price of $_____, based on the company’s average quoted share price on the OTC markets immediately prior to and assuming a conversion date of _______, 2021.

Unless we indicate otherwise, all information in this prospectus:

● Assumes no exercise by the underwriters of their option to purchase up to an additional shares of common stock to cover over-allotments, if any; and

● Excludes shares of common stock underlying the warrants to be issued to the underwriters in connection with this offering.

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SUMMARY CONSOLIDATED FINANCIAL INFORMATION

The following summary consolidated statements of operations data for the fiscal years ended December 31, 2019, and 2020 have been derived from our audited consolidated financial statements included elsewhere in this prospectus. Additionally, the summary statement of operations data for the six months ended June 30, 2020 and 2021 have been derived from our unaudited consolidated financial statements included elsewhere in this prospectus. The summary consolidated balance sheet data as of June 30, 2021 are derived from our consolidated unaudited financial statements that are included elsewhere in this prospectus. The pro forma consolidated balance sheet data gives effect to the sale of shares in this offering after deducting underwriting discounts and commissions and offering expenses payable by us. The historical financial data presented below is not necessarily indicative of our financial results in future periods, and the results for the six months ended June 30, 2021 is not necessarily indicative of our operating results to be expected for the full fiscal year ending December 31, 2021 or any other period. You should read the summary consolidated financial data in conjunction with those financial statements and the accompanying notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Our consolidated financial statements are prepared and presented in accordance with United States generally accepted accounting principles, or U.S. GAAP. Our consolidated financial statements have been prepared on a basis consistent with our audited financial statements and include all adjustments, consisting of normal and recurring adjustments that we consider necessary for a fair presentation of the financial position and results of operations as of and for such periods.

	Six Months Ended June 30,						Year Ended December 31,
	2021			2020			2020			2019
Consolidated Statement of Operations Data:
Revenue	$	1,319,388		$	521,319		$	1,009,949		$	680,732
Cost of revenue		1,012,028			268,683			546,569			431,363
Gross profit (loss)		307,360			252,636			463,380			249,369
Operating expenses		2,176,800			359,894			818,348			695,012
Operating loss		(1,869,440	)		(107,258	)		(354,968	)		(445,643	)
Other income (expense)		(1,549,237	)		(155,170	)		(252,132	)		222,434
Net loss before provision for income taxes		(3,418,677	)		(262,428	)		(607,100	)		(223,209	)
Provision for income taxes		81,996			806			809			—
Net loss	$	(3,500,673	)		(263,234	)	$	(607,909	)	$	(223,209	)
Foreign currency translations adjustment		(26,948	)		(37,607	)		6,477			21,244
Comprehensive income (loss)	$	(3,530,184	)	$	(300,841	)	$	(601,432	)	$	(201,965	)
Net loss per share – basic and diluted	$	(0.11	)	$	(0.01	)	$	(0.02	)	$	(0.01	)
Weighted average common shares outstanding – basic and diluted		30,478,877			27,297,960			27,297,960			27,297,960

				Pro Forma
	June 30, 2021			June 30, 2021 (1)
Consolidated Balance Sheet Data:
Cash	$	137,530		$
Total current assets		1,296,438
Total assets		8,693,143
Total current liabilities		9,416,816
Total liabilities		9,603,859
Total stockholders’ (deficit) equity		(910,716	)

(1) The pro forma consolidated balance sheet data gives effect to the conversion on September 22,2021 of the 50,000 shares of Series A Convertible Preferred Stock outstanding on June 30, 2021 into 55,195 shares of common stock, the conversion of $2,000,000 in aggregate principal amount of related party notes with the CEO (who has agreed to convert this amount into common shares prior to the closing of this offering) into shares of common stock, using a conversion price of 80% of the public offering price, an additional $600,000 in debt from a financing completed on September 17, 2021, and the sale of shares in this offering after deducting underwriting discounts and commissions and offering expenses payable by us.

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RISK FACTORS

Investing in our securities includes a high degree of risk. Prior to making a decision about investing in our securities, you should consider carefully the risk factors discussed below, together with all of the other information contained in this prospectus. Our business, financial condition, results of operations and prospects could be materially and adversely affected by these risks.

General Risks Relating to Our Business, Operations of Financial Condition

We have a limited operating history and are subject to the risks encountered by early-stage companies.

Our company has a limited operating history, and you should consider and evaluate our operating prospects in light of the risks and uncertainties frequently encountered by early-stage companies in rapidly evolving markets. For us, these risks include:

● risks that we may not have sufficient capital to achieve our growth strategy;

● risks that we may not develop our product and service offerings in a manner that enables us to be profitable and meet our customers’ requirements;

● risks that our growth strategy may not be successful; and

● risks that fluctuations in our operating results will be significant relative to our revenues.

These risks are described in more detail below. Our future growth will depend substantially on our ability to address these and the other risks described in this section. If we do not successfully address these risks, we will be unable to sustain our business growth to date and you could lose your investment.

Our operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. If we do not continue as a going concern, investors could lose their entire investment.

Our operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. We have an accumulated deficit of $(910,716) as of June 30, 2021. We may never achieve profitability. If we do not generate sufficient revenues, do not achieve profitability and do not have other sources of financing for our business, we may have to curtail or cease our development plans and operations, which could cause investors to lose the entire amount of their investment.

If we are unable to integrate our acquisitions or manage the growth of those companies effectively, our business could be adversely affected.

Our business has grown mostly through acquisition of other companies, both in the United States and in India. These companies, particularly in India, are currently expanding rapidly. Our future operating results depend to a large extent on our ability to manage this expansion and growth successfully. For us to continue to manage such growth, we must put in place legal and accounting systems, and implement human resource management and other tools. We may be unable to successfully manage this anticipated rapid growth. A failure to manage our growth effectively could materially and adversely affect our business.

Increasing competition within our emerging industry could have an impact on our business prospects.

The artificial intelligence, mobile payment and “gig” worker markets are emerging industries where new competitors are entering the market frequently. These competing companies may have significantly greater financial and other resources than we have and may have been developing their products and services longer than we have been developing ours, and we may be unable to successfully compete.

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Our current and future operations are subject to certain risks that are unique to operating in a foreign country.

We currently have international operations in India, Latin America, and Africa, among other places, and have a large concentration of employees and task workers in India. Therefore, we are exposed to risks inherent in international business operations. The risks of doing business in foreign countries include the following:

● changing regulatory or taxation policies, including changes in tax policies that have been proposed by the current United States administration that may affect the taxation of foreign earnings;

● currency exchange risks;

● changes in diplomatic relations or hostility from local populations;

● seizure of our property by the government or restrictions on our ability to transfer our property or earnings out of the foreign country;

● potential instability of foreign governments, which might result in losses against which we are not insured;

● difficulty in protecting our intellectual property from infringement in certain foreign countries; and

● difficulty of enforcing agreements and collecting receivables through some foreign legal systems.

Exchange rates may cause future losses in our international operations.

Because we own assets in foreign countries and derive revenue from our international operations, we may incur currency translation losses due to changes in the values of foreign currencies and in the value of the United States dollar. We cannot predict the effect of exchange rate fluctuations upon future operating results.

We may not be able to adequately protect our proprietary technology, and our competitors may be able to offer similar products and services, which would harm our competitive position.

Our success depends in part upon our proprietary technology. We rely primarily on national and local statutory and common law rights in the jurisdictions in which we operate, as well as contractual restrictions, to establish and protect our proprietary rights, but to date we have not sought or obtained any patents on our proprietary technology or registered any of our trademarks. Despite the precautions we have taken, third parties could copy or otherwise obtain and use our technology without authorization or develop similar technology independently. The protection of our proprietary rights may be inadequate or our competitors may independently develop similar technology, duplicate our products and services or design around any intellectual property rights we hold.

If third parties claim that we infringe their intellectual property, it may result in costly litigation.

Third parties may claim our current or future products infringe their intellectual property rights. Any such claims, with or without merit, could cause costly litigation that could consume significant management time. As the number of product and services offerings in the artificial intelligence, mobile payments and task worker markets increases and functionalities increasingly overlap, we may become increasingly subject to infringement claims. Such claims also might require us to enter into royalty or license agreements. If required, we may not be able to enter into such royalty or license agreements or obtain them on terms acceptable to us.

Pandemics including COVID-19 may adversely affect our business.

The recent unprecedented events related to COVID-19, the disease caused by the novel coronavirus (SARS-CoV-2), have had significant health, economic, and market impacts and may have short-term and long-term adverse effects on our business that we cannot predict as the global pandemic continues to evolve. The extent and effectiveness of responses by governments and other organizations also cannot be predicted. During 2020, COVID-19 forced us to suspend Last Mile deliveries and other task worker activities for a period of time, and we shifted some of those activities to a virtual, remote-service model until in-person activities could resume safely. The effects of the pandemic may have a particular effect on our business as a result of our extensive operations in India and other emerging markets, where vaccines are less available. While we continue to have the option to shift to virtual activities if necessary, it is unclear whether and to what extent future impacts of COVID-19 or other pandemics will have an adverse effect on our profitability and growth strategy.

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We may need additional financing. Any limitation on our ability to obtain such additional financing could have a material adverse effect on our business, financial condition and results of operations.

We may need to raise additional capital, which we may be unable to obtain on favorable or reasonable terms, or at all. If we raise additional capital, it could result in dilution to our stockholders. Any limitation on our ability to obtain additional capital as and when needed could have a material adverse effect on our business, financial condition and results of operations.

If we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial statements could be impaired, which could harm our operating results, our ability to operate our business and investors’ views of us.

Ensuring that we have adequate internal financial and accounting controls and procedures in place so that we can produce accurate financial statements on a timely basis is a costly and time-consuming effort. Section 404 of the Sarbanes-Oxley Act requires public companies to conduct an annual review and evaluation of their internal controls. The Company’s internal control over financial reporting was ineffective as of December 31, 2020, and our disclosure controls and procedures were ineffective as of June 30, 2021. Our failure to maintain the effectiveness of our internal controls in accordance with the requirements of the Sarbanes-Oxley Act could have a material adverse effect on our business. We could lose investor confidence in the accuracy and completeness of our financial reports, which could have an adverse effect on the price of our common stock. In addition, if our efforts to comply with new or changed laws, regulations, and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to practice, regulatory authorities may initiate legal proceedings against us and our business may be harmed.

Our revenue is currently concentrated in a small number of customers.

Although our strategy is to expand our business operations and customer base through our 2021 acquisitions of Rohuma and Mimo, most of our revenue has come historically from a few customers. For the six months ended June 30, 2021, we had two major customers comprising 87% of our revenues, and at June 30, 2021 these customers represented 87% of our accounts receivable. For the year ended December 31, 2020 and at the end of that year, these customers accounted for 85% of our revenues and our accounts receivable, respectively. A loss of the business from these customers or any difficulty collecting our accounts receivable from them could have a material adverse effect on our business, financial condition and results of operations.

Risks Relating to our Common Stock

One shareholder controls a majority of the voting power of our common stock, and his interest may conflict with those of investors.

Our Chairman of the Board of Directors, Chief Executive Officer and President, Ajay Sikka, beneficially owns shares representing a majority of our common stock. He therefore is in a position to exercise substantial influence over the outcome of all matters submitted to a vote of our shareholders, including the election of directors.

8

Our common stock may cease to be listed on the Nasdaq Stock Market.

We have applied to have our common stock listed on the Nasdaq Global Market under the symbol “TRIQ.” Our application has not yet been approved, and there can be no assurance that it will be approved. If it is approved and our common stock is listed, we may not be able to meet the continued listing requirements of the Nasdaq Stock Market, which require, among other things, a minimum closing price of our common stock and a minimum market capitalization. If we are unable to satisfy the requirements of the Nasdaq Global Market for continued listing, our common stock would be subject to delisting from that market, and we might or might not be eligible to list our shares on another Nasdaq market. A delisting of our common stock from the Nasdaq Global Market, particularly if we did not qualify to be listed on another Nasdaq market, could negatively impact us by, among other things, reducing the liquidity and market price of our common stock.

The difficulties associated with any attempt to gain control of our company could adversely affect the price of our common stock.

Ajay Sikka has substantial influence over the decision as to whether a change in control will occur for our company. There are also provisions contained in our articles of incorporation, by-laws and California law that could make it more difficult for a third party to acquire control of TraQiQ. These restrictions and limitations could adversely affect the trading price of our common stock.

There is currently not an active liquid trading market for the Company’s common stock.

Our common stock is quoted on the OTC Markets QB tier under the symbol “TRIQ”. However, there is currently no regular active trading market in our common stock. Although there are periodic volume spikes from time to time, a consistent, active trading market may not develop. Further, in the event this offering is completed, and our common stock is listed on the Nasdaq Global Market, there is no assurance an active trading market for our common stock will develop or be sustained or that we will remain eligible for continued listing on the Nasdaq Global Market. If an active market for our common stock develops, there is a significant risk that our stock price may fluctuate in the future in response to any of the following factors, some of which are beyond our control:

● variations in our quarterly operating results;

● announcements that our revenue or income are below analysts’ expectations;

● general economic downturns;

● sales of large blocks of our common stock; or

● announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments.

You may experience dilution of your ownership interest due to future issuance of our securities.

We are currently authorized to issue 300,000,000 shares of common stock and 10,000,000 shares of preferred stock. We may issue additional shares of common stock or other securities that are convertible into or exercisable for common stock in future public offerings or private placements for capital raising purposes or for other business purposes, or upon conversion or exercise of outstanding options, warrants, or preferred stock. The future issuance of a substantial amount of common stock, or the perception that such an issuance could occur, could adversely affect the prevailing market price of our common shares. A decline in the price of our common stock could make it more difficult to raise funds through future offerings of our common stock or securities convertible into common stock.

Our board of directors may issue and fix the terms of shares of our preferred stock without stockholder approval, which could adversely affect the voting power of holders of our common stock or any change in control of our company.

Our articles of incorporation authorize the issuance of up to 10,000,000 shares of “blank check” preferred stock, with such designation rights and preferences as may be determined from time to time by the board of directors. Of these authorized shares, 50,000 shares have been designated Series A Preferred Stock but none of them are currently outstanding (see “Description of Capital Stock”). Our board of directors is empowered, without shareholder approval, to create additional series and issue additional shares of preferred stock with dividend, liquidation, conversion, voting or other rights which could adversely affect the voting power or other rights of the holders of our common stock. In the event of such issuances, the preferred stock could be used, under certain circumstances, as a method of discouraging, delaying or preventing a change in control of our company.

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We do not expect to pay dividends and investors should not buy our common stock expecting to receive dividends.

We do not anticipate that we will declare or pay any dividends in the foreseeable future. Consequently, you will only realize an economic gain on your investment in our common stock if the price appreciates, which may not occur. You should not purchase our common stock expecting to receive cash dividends. Since we do not pay dividends, and if an active trading market for our shares does not develop, you may not have any manner to liquidate or receive any payment on your investment. Therefore, our failure to pay dividends may cause you to not see any return on your investment even if we are successful in our business operations. In addition, because we do not pay dividends we may have trouble raising additional funds which could affect our ability to expand our business operations.

Risks Related to the Offering

Investors in this offering will experience immediate and substantial dilution in net tangible book value.

The public offering price will be substantially higher than the net tangible book value per share of our outstanding shares of common stock. As a result, investors in this offering will incur immediate dilution of $_____ per share, based on the assumed public offering price of $_____ per share of common stock and the closing price of our common stock on ____________, 2021. See “Dilution” for a more complete description of how the value of your investment will be diluted upon the completion of this offering.

In addition, during 2021 we agreed to issue up to an additional 1,729,943 shares of common stock without additional consideration to the former owners of Rohuma contingent on the financial performance of Rohuma and issued warrants to the former owners of Mimo for the purchase of up to 1,367,539 shares of our common stock at an exercise price of $0.001 per share (of which warrants for 820,524 shares are currently earned and warrants for the other 547,015 shares are contingent on the future performance of the Mimo business). If these shares are all issued, investors in this offering will incur additional dilution of $_____ per share, based on the assumed public offering price of $_____ per share of common stock and the closing price of our common stock on ____________, 2021.

Our common stock is subject to the “penny stock” rules of the SEC and the trading market in the securities is limited, which makes transactions in the stock cumbersome and may reduce the value of an investment in the stock.

Our common stock is subject to the “penny stock” rules of the SEC because it has historically had a market price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require:

● that a broker or dealer approve a person’s account for transactions in penny stocks after compliance with various information collection rules and a suitability evaluation;

● the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased; and

● the broker or dealer deliver a disclosure schedule prescribed by the SEC.

If we are successful in our application to list our stock for trading on the Nasdaq Stock Market and we are able to maintain that listing, our stock will cease to be a penny stock. However, if we cease to obtain and maintain that listing, we may again be subject to the penny stock rules. Generally, brokers may be less willing to execute transactions in securities subject to the penny stock rules. In addition, according to the SEC, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. These factors may make it more difficult for investors to dispose of our common stock and cause a decline in the market value of our common stock if it were to become subject to the penny stock rules.

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We have broad discretion in the use of the net proceeds from this offering and may not use them effectively.

Our management will have broad discretion in the application of the net proceeds of this offering, including for any of the purposes described in the section of this prospectus entitled “Use of Proceeds.” You will be relying on the judgment of our management with regard to the use of these net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the net proceeds are being used appropriately. The failure by our management to apply these funds effectively could result in financial losses that could have a material adverse effect on our business and cause the price of our securities to decline. Pending the application of these funds, we may invest the net proceeds from this offering in a manner that does not produce income or that loses value.

Risks Related to Our Reverse Stock Split

Although on ______, 2021 we implemented a 1 for ___ reverse stock split, we cannot assure you that we will be able to continue to comply with the minimum bid price requirement of the Nasdaq Stock Market tier on which we are listed.

We cannot assure you that the market price of our common stock following the reverse stock split will remain at the level required for continuing compliance with the minimum bid price for the Nasdaq market tier on which our common stock is listed or the minimum for listing on any other Nasdaq market. It is not uncommon for the market price of a company’s common stock to decline in the period following a reverse stock split. If the market price of our common stock declines following the completion of the reverse stock split, the percentage decline may be greater than would occur in the absence of the reverse stock split. In any event, other factors unrelated to the number of shares of our common stock outstanding, such as negative financial or operational results, could adversely affect the market price of our common stock and jeopardize our ability to meet or maintain Nasdaq’s minimum bid price requirement for its Global market tier. In addition to specific listing and maintenance standards, Nasdaq has broad discretionary authority over the initial and continued listing of securities, which it could exercise with respect to the listing of our common stock.

The reverse stock split may decrease the liquidity of the shares of our common stock.

The liquidity of the shares of our common stock may be affected adversely by the reverse stock split given the reduced number of shares that are outstanding following the reverse stock split. In addition, the reverse stock split may increase the number of stockholders who own odd lots (less than 100 shares) of our common stock, creating the potential for such stockholders to experience an increase in the cost of selling their shares and greater difficulty effecting such sales.

Following the reverse stock split, the resulting market price of our common stock may not attract new investors, including institutional investors, and may not satisfy the investing requirements of those investors. Consequently, the trading liquidity of our common stock may not improve.

Although we believe that a higher market price of our common stock may help generate greater or broader investor interest, there can be no assurance that the reverse stock split will result in a share price that will attract new investors, including institutional investors. In addition, there can be no assurance that the market price of our common stock will satisfy the investing requirements of those investors. As a result, the trading liquidity of our common stock may not improve.

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USE OF PROCEEDS

We estimate that the net proceeds from the sale of the common stock in the offering will be approximately $_____________, after deducting the underwriting discounts and commissions and estimated offering expenses, or approximately $___________ if the underwriters exercise their over-allotment option in full.

We currently expect to use the net proceeds of this offering primarily for the following purposes:

● Approximately $8,500,000 to fund sales and marketing activities;

● Approximately $4,000,000 for acquisitions of other companies, products or technologies involving software similar to that offered by TraQiQ or task worker services, although we have not currently entered into agreements or letters of intent for any such acquisitions;

● Approximately $2,000,000 to fund engineering activities;

● Approximately $2,000,000 to pay outstanding invoices and to repay approximately $_________ in outstanding debt with a weighted average interest rate of ___% and maturities ranging from ____ to ____;

● Approximately $500,000 for working capital; and

● The remainder for other general corporate purposes.

We believe that the expected net proceeds from this offering and our existing cash and cash equivalents, together with interest thereon, will be sufficient to fund our operations for at least the next 12 months, although we cannot assure you that this will occur.

The amount and timing of our actual expenditures will depend on numerous factors, including the status of our development efforts, sales and marketing activities and the amount of cash generated or used by our operations. We may find it necessary or advisable to use portions of the proceeds for other purposes, and we will have broad discretion and flexibility in the application of the net proceeds. Pending these uses, we will invest the proceeds in short-term bank deposits.

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MARKET FOR OUR COMMON STOCK AND RELATED STOCKHOLDER MATTERS

TraQiQ’s common stock is traded on the OTCQB Market under the symbol “TRIQ.” Because the company’s common stock is not listed on a securities exchange and its quotations on OTCQB are limited and sporadic, there is currently no established public trading market for the common stock. TraQiQ has applied to The Nasdaq Global Market to list its common stock under the symbol “TRIQ”.

On ________, 2021, we completed a 1-for-___ reverse split of our common stock. All share and per share information gives effect, retroactively, to the reverse stock split.

As of ________, 2021, there were approximately _____ registered holders of record of our common stock, and the last reported sale price of our common stock on the OTCQB was $_____ per share on _________, 2021.

Any over-the-counter market quotations of our common stock reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

Dividends

The company has never declared or paid any cash dividends on its common stock. The company currently intends to retain future earnings, if any, to finance the expansion of its business. As a result, the company does not anticipate paying any cash dividends in the foreseeable future.

Securities Authorized for Issuance Under Equity Compensation Plans

The following table gives information about our common stock that may be issued upon the exercise of options, warrants and rights under our 2020 Equity Incentive Plan as of December 31, 2020. Our shareholders have not approved this plan.

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted-average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
	(a)		(b)		(c)
Equity compensation plans approved by security holders		-		-		-
Equity compensation plans not approved by security holders		3,930,000	$	0.0052		1,570,000
Total		3,930,000	$	0.0052		1,570,000

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CAPITALIZATION

The following table sets forth our consolidated cash and cash equivalents and capitalization as of June 30, 2021. Such information is set forth on the following basis:

● an actual basis (giving effect, on a retroactive basis, to a 1-for-___ reverse stock split which was consummated on _____________, 2021);

● a pro forma basis to give effect to (i) the conversion on September 22, 2021 of the 50,000 outstanding shares of Series A Convertible Preferred Stock into 55,195 common shares, (ii) the conversion of $2,000,000 in aggregate principal amount of related party notes with the CEO (who has agreed to convert this amount into common shares prior to the closing of this offering) into shares of common stock, using a conversion price of 80% of the public offering price, and (iii) an additional $600,000 in debt from a financing completed on September 17, 2021; and

● a pro forma as adjusted basis, giving effect to the pro forma adjustments above as well as the sale of the shares in this offering at the assumed public offering price of $_____ per share which was the last reported sale price of our common stock on the OTCQB on _________, 2021, after deducting underwriting discounts and commissions and other estimated offering expenses payable by us.

The as adjusted information below is illustrative only and our capitalization following the completion of this offering will be adjusted based on the actual public offering price and other terms of this offering determined at pricing. You should read this table together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our audited and unaudited consolidated financial statements and the related notes appearing elsewhere in this prospectus.

	As of June 30, 2021
	Actual			Pro Forma		Pro Forma As Adjusted(1)
Consolidated Balance Sheet Data:
Cash	$	137,530		$		$
Total other assets		8,555,613
Total liabilities		9,603,859
Preferred stock, par value, $0.0001, 10,000,000 shares authorized, Series A Convertible Preferred, 50,000 shares issued and outstanding, actual, 0 shares issued and outstanding, pro forma and pro forma as adjusted		5			—		—
Common stock, par value, $0.0001, 300,000,000 shares authorized, 31,430,575 shares issued and outstanding, actual,           shares issued and outstanding, pro forma,           shares issued and outstanding, pro forma as adjusted		3,143
Additional paid-in capital		5,090,929
Accumulated deficit		(6,008,129	)
Accumulated other comprehensive income		773
Total stockholders’ (deficit) equity before non-controlling interest		(913,279	)
Non-controlling interest		2,563
Total stockholders’ (deficit) equity		(910,716	)
Capitalization		8,693,143

(1) A $1.00 increase or decrease in the assumed public offering price per share would increase or decrease our pro forma as adjusted cash, additional paid-in capital, total stockholders’ equity and total capitalization by approximately $            assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the underwriter discount and estimated offering expenses payable by us.

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DILUTION

Our pro forma net tangible book value (deficit) as of June 30, 2021 was approximately $1,041,284, or $0.03 per share of common stock based upon 33,659,683 shares of common stock outstanding on that date after giving pro forma effect to the conversion on September 22, 2021 of the 50,000 shares of Series A Convertible Preferred Stock outstanding on June 30, 2021 into 55,195 shares of common stock, the conversion of $2,000,000 in aggregate principal amount of related party notes with the CEO (who has agreed to convert this amount into common shares prior to the closing of this offering) into shares of common stock, using a conversion price of 80% of the public offering price, and (iii) an additional $600,000 in debt from a financing completed on September 17, 2021. Pro forma net tangible book value (deficit) per share represents the amount of our total pro forma tangible assets reduced by the amount of our total pro forma liabilities, divided by the total number of shares of common stock outstanding on a pro forma basis, after giving effect to the same conversions and issuances.

Our pro forma as adjusted net tangible book value (deficit) will be $___________ or $____ per share. Pro forma as adjusted net tangible book value (deficit) per share represents pro forma as adjusted net tangible book value divided by the total number of shares outstanding on a pro forma basis after giving effect to the sale of the shares in this offering at the assumed public offering price of $____ per share, after deducting underwriting discounts and commissions and other estimated offering expenses payable by us. This represents an immediate increase in pro forma as adjusted net tangible book value of $____ per share to existing stockholders and an immediate dilution of $____ per share to investors purchasing shares of common stock in this offering at the assumed public offering price.

The following table illustrates this dilution on a per share basis to new investors:

Assumed public offering price per share		$
Pro forma net tangible book value per share as of June 30, 2021	$
Increase in net tangible book value per share attributable to new investors	$
Pro forma as adjusted net tangible book value per share after giving effect to this offering		$
Dilution in net tangible book value per share to new investors		$

The information above is pro forma as of June 30, 2021 and excludes as of such date the following:

● 1,090,249 shares of our common stock issuable upon conversion of convertible notes at a conversion price of $0.54 per share as of June 30, 2021;

● outstanding options to purchase an aggregate of 3,930,000 shares of common stock at a weighted average exercise price of $0.0052 under our equity compensation plan;

● 2,277,689 shares issuable upon exercise of outstanding warrants which were issued in connection with the MIMO acquisition, of which 1,730,669 are currently exercisable and 547,016 are contingent upon achievement of future revenue targets;

● 536,276 shares issuable upon exercise of outstanding warrants which were issued in connection with the September financing, 357,517 additional shares issuable upon exercise of warrants we are committed to issue in connection with that financing within three days after filing the registration statement of which this prospectus is a part, and 178,326 shares issuable upon exercise of warrants that will be issued at the election of our lenders in the future as a part of that financing, all at an exercise price of $1.45;

● 1,729,943 shares issuable in connection with the Rohuma acquisition contingent upon achievement of future revenue targets, and 350,000 shares issuable to a director for services rendered that are accruing over a three-year period;

● 413,793 shares of common stock issuable upon conversion at a conversion price of $1.45 of an outstanding convertible note from the September financing, 275,862 additional shares issuable upon conversion at a conversion price of $1.45 of a convertible note we are committed to issue in connection with that financing within three days after filing the registration statement of which this prospectus is a part, and 137,931 shares issuable upon conversion at a conversion price of $1.45 of a convertible note that will be issued at the election of our lenders in the future as a part of that financing;

● 1,200,000 shares of common stock issued to the CEO as compensation in September 2021;

● ______ shares of common stock underlying the warrants to be issued to the underwriters in connection with this offering (________ shares if the over-allotment is exercised in full); and

● _______ shares of common stock issuable upon the exercise of the underwriters’ over-allotment option.

If the underwriters exercise their overallotment option, our pro forma as adjusted net tangible book value following the offering will be $____ per share, and the dilution to new investors in the offering will be $____ per share.

A $1.00 increase or decrease in the assumed public offering price per share would increase or decrease our pro forma as adjusted net tangible book value after this offering by approximately $________, and dilution per share to new investors by approximately $_____.

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. Forward-looking statements involve risks and uncertainties and include statements regarding, among other things, our projected revenue growth and profitability, our growth strategies and opportunity, anticipated trends in our market and our anticipated needs for working capital. They are generally identifiable by use of the words “may,” “will,” “should,” “anticipate,” “estimate,” “plans,” “potential,” “projects,” “continuing,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend” or the negative of these words or other variations on these words or comparable terminology. These statements may be found under the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business,” as well as in this prospectus generally. In particular, these include statements relating to future actions, prospective products, market acceptance, future performance or results of current and anticipated products, sales efforts, expenses, and the outcome of contingencies such as legal proceedings and financial results.

Examples of forward-looking statements in this prospectus include, but are not limited to, our expectations regarding our business strategy, business prospects, operating results, operating expenses, working capital, liquidity and capital expenditure requirements. Important assumptions relating to the forward-looking statements include, among others, assumptions regarding demand for our products, the cost, terms and availability of components, pricing levels, the timing and cost of capital expenditures, competitive conditions and general economic conditions. These statements are based on our management’s expectations, beliefs and assumptions concerning future events affecting us, which in turn are based on currently available information. These assumptions could prove inaccurate. Although we believe that the estimates and projections reflected in the forward-looking statements are reasonable, our expectations may prove to be incorrect.

Important factors that could cause actual results to differ materially from the results and events anticipated or implied by such forward-looking statements include, but are not limited to:

● changes in the market acceptance of our products;

● increased levels of competition;

● changes in political, economic or regulatory conditions generally and in the markets in which we operate;

● our relationships with our key customers;

● our ability to retain and attract senior management and other key employees;

● our ability to quickly and effectively respond to new technological developments;

● our ability to protect our trade secrets or other proprietary rights, operate without infringing upon the proprietary rights of others and prevent others from infringing on our proprietary rights; and

● other risks, including those described in the “Risk Factors” discussion of this prospectus.

We operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for us to predict all of those risks, nor can we assess the impact of all of those risks on our business or the extent to which any factor may cause actual results to differ materially from those contained in any forward-looking statement. The forward-looking statements in this prospectus are based on assumptions management believes are reasonable. However, due to the uncertainties associated with forward-looking statements, you should not place undue reliance on any forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and unless required by law, we expressly disclaim any obligation or undertaking to publicly update any of them in light of new information, future events, or otherwise.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our financial statements and notes thereto appearing elsewhere in this Registration Statement on Form S-1.

Our financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments and assumptions are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting any available alternative would not produce a materially different result.

Overview

TraQiQ was incorporated in the State of California on September 9, 2009 as Thunderclap Entertainment, Inc. On July 14, 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc. On July 19, 2017, the Company entered into a Share Exchange Agreement with the stockholders of OmniM2M, Inc. (“OmniM2M”) and TraQiQ Solutions, Inc. dba Ci2i Services, Inc. (formerly Ci2i Services, Inc. – amended November 6, 2019) (“Ci2i”) whereby the stockholders of OmniM2M and Ci2i agreed to exchange all of their respective shares, representing 100% ownership in OmniM2M and Ci2i in exchange for 12,000,000 shares of the Company’s common stock, respectively. The OmniM2M Shareholders and the Ci2i Shareholders were issued their respective 12,000,000 shares on a pro rata basis based on their respective holdings in OmniM2M and Ci2i in the Share Exchange Agreement. The Share Exchange was accounted for as a reverse merger whereas Ci2i is considered the accounting acquirer and TraQiQ, Inc. is considered the accounting acquiree. Accordingly, the consolidated financial statements included the accounts of Ci2i for all periods presented and the accounts of TraQiQ, Inc. and OmniM2M, which was acquired by the Company on July 19, 2017 since the date of acquisition. For accounting purposes, the acquisition of OmniM2M is recorded at historical cost in accordance with Accounting Standard Codification (“ASC”) 805-50-25-2 as this is considered an acquisition of entities under common control as the management of the Company and OmniM2M control the activities of the respective companies. Prior to the merger with Ci2i and acquisition of OmniM2M, the Company was considered a shell company under Rule 12b-2 of Exchange Act. On December 1, 2017, the Company entered into a Share Purchase Agreement with Ajay Sikka (“Sikka”), the sole shareholder of Transport IQ, Inc. whereby Sikka sold all of the shares in TransportIQ, Inc. (“TransportIQ”) in exchange for $18,109, in the form of cancellation of all of the debt of TransportIQ that was owed to the Company. The transaction became effective upon the execution of the agreement by Sikka and the Company; and Transport IQ, Inc, is now a wholly-owned subsidiary of the Company. Because TransportIQ was commonly controlled and owned, the transaction was recorded at the historical carrying value of TransportIQ’s assets and liabilities.

Ci2i is a services company founded in 1998 that develops and deploys intelligent technologies and products in order to meet the demand for sustainable, integrated solutions. Ci2i’s primary focus has been in the analytics and intelligence segments. The Company is investing significantly in building products in the area of supply chain and last mile delivery.

On May 16, 2019, the Company entered into a Share Exchange Agreement with TRAQIQ Solutions Private Limited (TraQ Pvt Ltd), formerly known as Mann-India Technologies Pvt Ltd. Pursuant to the agreement, the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities in exchange for warrants exercisable over five-years to purchase up to 1,329,272 shares of common stock of the Company valued at $268 at an exercise price of $0.0001. The warrants are exercisable as follows: (i) 100,771 warrants immediately upon closing; (ii) 859,951 warrants exercisable one-year after the date of closing; and (iii) 368,550 warrants exercisable two-years after the date of closing. This transaction is being recorded as a business combination under ASC 805.

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The warrants that are exercisable in one-year and two-years were conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. For the warrants to become exercisable, TRAQ Pvt Ltd. was required to achieve target revenue of $1.1 million and pre-tax profit of 25% in 2019 and 2020, respectively, with the amount of such warrants becoming exercisable reduced proportionally to the extent TRAQ Pvt Ltd. failed to achieve these targets. A total of 419,127 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved. Accordingly, 910,146 of the warrants remain exercisable.

Effective December 31, 2020, Ci2i acquired the net assets of OmniM2M and TransportIQ, and then dissolved those entities in January 2021. The value of those transactions were for the assumed liabilities of Omni and TransportIQ, and no cash was exchanged.

On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuna members agreed to exchange all of their respective membership interests in Rohuma in exchange for up to 4,292,220 shares of common stock, of which the first tranche of 2,562,277 shares was issued upon closing on March 1, 2021, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. Issuance of the remaining shares is contingent upon Rohuma achieving certain revenue targets for the calendar years 2021 and 2022. The transaction was valued at $3,433,776 ($0.80 per share). Rohuma has an Indian affiliate that is owned 99% by Rohuma and 1% by its founding member. Rohuma controls this entity and the 1% ownership by the member is now less than 1% upon acquisition by the Company. This amount is reflected as a non-controlling interest.

Rohuma dba Kringle.ai is a California based software solutions company that enables digital and mobile commerce by providing enterprise class applications that cover loyalty and rewards products, payments, online ordering, distribution logistics for retail and more. Kringle analyzes customers’ omni-channel behaviors and transactions. Using AI for digital commerce, Kringle is able to deliver real time, automated 1:1 recommendations and personalized content across all customer touch points.

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., an Indian corporation (“Mimo”), and its shareholders, whereby the Mimo shareholders exchanged all of their respective shares in Mimo for warrants to purchase up to 1,367,539 shares of the Company’s common stock. Of these warrants, 820,524 were earned at the date of acquisition, with the remaining 547,015 warrants to be earned during the remainder of 2021 and 2022 subject to Mimo meeting certain revenue goals for 2021 and 2022. The warrants have a term of three years and an exercise price of $0.001 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, the Company made a cash payment to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.

Mimo provides delivery and task worker solutions across India. Mimo works with Banking, Financial, Logistics and Distribution companies, to take their products and services to semi-urban and rural India. Mimo trains the agents in each Product or Service through an online and classroom training platform.

Going Concern

The Company has an accumulated deficit of $6,008,129 and a working capital deficit of $8,120,378 as of June 30, 2021, compared to a working capital deficit of $2,851,721 as of December 31, 2020. The Company’s continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations, which it has not been able to accomplish to date, and/or obtain additional financing from its stockholders and/or other third parties.

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Our consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to meet its obligations and continue its operations for the next fiscal year. The continuation of the Company as a going concern is dependent upon the ability of the Company to obtain necessary equity or debt financing to continue operations, successfully locating and negotiating with other business entities for potential acquisition and /or acquiring new clients to generate revenues. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.

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

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

Critical Accounting Policies and Estimates

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

Consolidation

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

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

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

Noncontrolling Interests

In accordance with ASC 810-10-45 Noncontrolling Interests in Consolidated Financial Statements, the Company classifies noncontrolling interests as a component of equity within the consolidated balance sheet. In January 2021, the acquisition of Rohuma resulted in a less than 1% non-controlling interest of the Indian affiliate of that company. In February 2021, the acquisition of Mimo resulted in a less than 1% non-controlling interest of that company.

Use of Estimates

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

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Capitalized Software Costs

In accordance with the relevant FASB accounting guidance regarding the development of software to be sold, leased, or marketed, the Company expenses such costs as they are incurred until technological feasibility has been established, at and after which time these costs are capitalized until the product is available for general release to customers. Once the technological feasibility is established per ASC 985-20, the Company capitalizes costs associated with the acquisition or development of major software for internal and external use in the balance sheet. Costs incurred to enhance the Company’s software products, after general market release of the services using the products, is expensed in the period they are incurred. The Company only capitalizes subsequent additions, modifications or upgrades to internally developed software to the extent that such changes allow the software to perform a task it previously did not perform. The Company expenses software maintenance and training costs as incurred.

Revenue Recognition

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

Professional Service Revenue

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

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

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

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TRAQ Pvt Ltd. has deferred the revenue and costs attributable to certain process transition activities with respect to its customers where such activities do not represent the culmination of a separate earnings process. Such revenue and costs are subsequently recognized ratably over the period in which the related services are performed. Further, the deferred costs are limited to the amount of the deferred revenues.

TRAQ Pvt Ltd. has now started offering an integrated solution for supply chain and last mile. This product called “TraQSuite” is now offered in multiple markets as a cloud-based subscription offering. This is a significant improvement from the earlier professional services business.

Software Solution Revenue

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

Costs of Services Provided

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

Foreign Currency Transactions

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

Uncertain Tax Positions

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

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

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Fair Value of Financial Instruments

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

Earnings (Loss) Per Share of Common Stock

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

Related Party Transactions

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

Lease Obligations

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

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately.

Results of Operations for the Six Months Ended June 30, 2021 as Compared to the Six Months Ended June 30, 2020

Revenues

For the six months ended June 30, 2021 compared to June 30, 2020, the Company’s revenues increased by $798,069, or 153%, from $521,219 in 2020 to $1,319,388 in 2021. The increase is the result of the acquisitions of Rohuma and Mimo as well as improvement in revenues as TRAQ Pvt Ltd. has started to emerge from the effects of COVID which contributed higher revenue and the addition of new customers in TRAQ Solutions, Inc.

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Cost of Revenues

For the six months ended June 30, 2021 compared to June 30, 2020, the Company’s cost of revenues increased by $743,345, or 277%, from $268,683 in 2020 to $1,012,028 in 2021. The increase is the result of the acquisitions of Rohuma and Mimo as well as added direct labor for TRAQ Pvt Ltd. The Company experienced lower gross profitability in these new engagements, as they ramped up personnel post-COVID.

Operating Expenses

For the six months ended June 30, 2021 compared to June 30, 2020, the Company’s salary and salary related costs increased by $214,374, or 227%, from $94,639 in 2020 to $309,013 in 2021 due to the acquisitions of Rohuma and Mimo as well as increases to management salaries.

During the six months ended June 30, 2021 compared to June 30, 2020, the Company’s professional fees increased by $172,153, or 150%, from $115,135 in 2020 to $287,288 in 2021. Our professional fees increased in 2021 compared to 2020 due to the acquisitions of Rohuma and Mimo as well as fees related to the acquisitions of those companies and the preparation of the annual report.

For the six months ended June 30, 2021 compared to June 30, 2020, the Company’s rent expense decreased by $48,384, or 76%, from $63,895 in 2020 to $15,511 in 2021 due to TRAQ Pvt Ltd. renegotiating their leases in December 2020, reducing their space due to COVID.

For the six months ended June 30, 2021 compared to June 30, 2020, the Company’s depreciation and amortization expense increased $12,213, or 49%, from $24,806 in 2020 to $37,019 in 2021. The increase was the result of the depreciation and amortization expense on the fixed and intangible assets acquired in the Rohuma and Mimo acquisitions.

For the six months ended June 30, 2021 compared to June 30, 2020, the Company’s general and administrative expenses increased by $1,466,550, or 2388%, from $61,419 in 2020 to $1,527,069 in 2021 primarily due to the acquisitions of Rohuma and Mimo as well as expenses related to stock-based compensation.

Interest Expense

For the six months ended June 30, 2021 compared to June 30, 2020, the Company’s interest expense increased by $198,008, or 120%, from $165,170 in 2020 to $363,178 in 2021 due to higher levels of debt in 2021.

Changes in Fair Value of Derivative Liabilities

For the six months ended June 30, 2021 compared to June 30, 2020, the Company’s change in the fair value of the derivative liability increased by $1,196,132, from $0 in 2020 to $1,196,132 in 2021 due to the convertible promissory notes and related warrants being classified as derivative liabilities and the changes in the share price over the period ended June 30, 2021.

Net Loss

For the six months ended June 30, 2021 compared to June 30, 2020, the Company’s net loss increased by $3,237,439, from $(263,234) in 2020 to $(3,500,673) in 2021 due to the changes noted herein.

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Results of Operations for the Three Months Ended June 30, 2021 as Compared to the Three Months Ended June 30, 2020

Revenues

For the three months ended June 30, 2021 compared to June 30, 2020, the Company’s revenues increased by $706,744, or 307%, from $230,258 in 2020 to $937,002 in 2021. The increase is the result of the acquisitions of Rohuma and Mimo as well as improvement in revenues as TRAQ Pvt Ltd. has started to emerge from the effects of COVID which contributed higher revenue and the addition of new customers in TRAQ Solutions, Inc.

Cost of Revenues

For the three months ended June 30, 2021 compared to June 30, 2020, the Company’s cost of revenues increased by $658,651, or 508%, from $129,545 in 2020 to $788,196 in 2021. The increase is the result of the acquisitions of Rohuma and Mimo as well as added direct labor for TRAQ Pvt Ltd. The company experienced lower profitability in these new engagements, as they ramped up personnel post-COVID.

Operating Expenses

For the three months ended June 30, 2021 compared to June 30, 2020, the Company’s salary and salary related costs increased by $112,368, or 233%, from $48,214 in 2020 to $160,582 in 2021 due to the acquisitions of Rohuma and Mimo as well as increases to management salaries.

During the three months ended June 30, 2021 compared to June 30, 2020, the Company’s professional fees increased by $80,610, or 146%, from $55,253 in 2020 to $135,863 in 2021. Our professional fees increased in 2021 compared to 2020 due to the acquisitions of Rohuma and Mimo as well as fees related to the acquisitions of those companies.

For the three months ended June 30, 2021 compared to June 30, 2020, the Company’s rent expense decreased by $23,161, or 75%, from $30,886 in 2020 to $7,725 in 2021 due to TRAQ Pvt Ltd. renegotiating their leases in December 2020, reducing their space due to COVID.

For the three months ended June 30, 2021 compared to June 30, 2020, the Company’s depreciation and amortization expense increased $8,225, or 68%, from $12,076 in 2020 to $20,301 in 2021. The increase was the result of the depreciation and amortization expense on the fixed and intangible assets acquired in the Rohuma and Mimo acquisitions.

For the three months ended June 30, 2021 compared to June 30, 2020, the Company’s general and administrative expenses increased by $665,584, or 2496%, from $26,661 in 2020 to $692,245 in 2021 primarily due to the acquisitions of Rohuma and Mimo as well as expenses related to stock-based compensation.

Interest Expense

For the three months ended June 30, 2021 compared to June 30, 2020, the Company’s interest expense increased by $135,559, or 165%, from $81,986 in 2020 to $217,545 in 2021 due to higher levels of debt in 2021.

Changes in Fair Value of Derivative Liabilities

For the three months ended June 30, 2021 compared to June 30, 2020, the Company’s change in the fair value of the derivative liability increased by $691,125, from $0 in 2020 to $691,125 in 2021 due to the convertible promissory notes and related warrants being classified as derivative liabilities and the changes in the share price over the period June 30, 2021.

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Net Loss

For the three months ended June 30, 2021 compared to June 30, 2020, the Company’s net loss increased by $1,665,942, from $(144,360) in 2020 to $(1,810,302) in 2021 due to the changes noted herein.

Results of Operations for the Year Ended December 31, 2020 as Compared to the Year Ended December 31, 2019

Revenues

For the year ended December 31, 2020 compared to December 31, 2019, the Company’s revenues increased by $362,667, or 53%, from $680,732 in 2019 to $1,043,399 in 2020 due to the Company’s lack of trucking revenue being generated in TransportIQ offset by the revenues generated in TRAQ Pvt Ltd. post-acquisition in May 2019. The Company will continue to focus on and move towards an analytics model (solutions revenue) which the Company expects to generate more revenue and potentially higher profitability.

Cost of Sales

For the year ended December 31, 2020 compared to December 31, 2019, the Company’s cost of revenues increased by $115,206, or 27%, from $431,363 in 2019 to $546,569 in 2020 due to the Company’s lack of support services being incurred to accommodate the trucking services in TransportIQ offset by the cost of revenues generated in TRAQ Pvt Ltd. post-acquisition in May 2019. The Company will continue to move towards an analytics model which the Company expects to generate more revenue and potentially higher profitability.

Operating Expenses

For the year ended December 31, 2020 compared to December 31, 2019, the Company’s salary and salary related costs increased by $169,643, or 148%, from $114,615 in 2019 to $284,258 in 2020 due to the salary and salary related costs of TRAQ Pvt Ltd. post-acquisition in May 2019.

During the year ended December 31, 2020, compared to 2019, the Company’s professional fees decreased by $86,345, or 30%, from $287,775 in 2019 to $201,430 in 2020. Our professional fees increased in 2019 compared to 2020 due the professional fees of TRAQ Pvt Ltd. post-acquisition in May 2019 and filing a Regulation A+ offering statement with the Securities and Exchange Commission in 2019. In 2020 we limited our professional fees due to cash flow issues.

For the year ended December 31, 2020 compared to December 31, 2019, the Company’s rent expense increased by $12,982, or 15%, from $88,863 in 2019 to $101,845 in 2020. We have re-worked our lease arrangement with the landlord of TRAQ Pvt Ltd and reduced our leased space considerably as of December 31, 2020 and anticipate our rent expense will be lower for the remainder of 2021. The increase in 2020 was attributable to a full year of rent expense in 2020 rather than seven and a half months in 2019.

For the year ended December 31, 2020 compared to December 31, 2019, the Company’s depreciation and amortization expense increased $5,148, or 12%, from $42,840 in 2019 to $47,988 in 2020. The increase was the result of incurring twelve months of depreciation and amortization expense on the fixed and intangible assets acquired in the TRAQ Pvt Ltd. Acquisition in 2020 and seven and a half months of such expenses in 2019.

For the year ended December 31, 2020 compared to December 31, 2019, the Company’s general and administrative expenses increased by $21,908, or 14%, from $160,919 in 2019 to $182,827 in 2020. The increase was primarily due to lower overhead expenses in TransportIQ as the Company is moving towards an analytics model offset by the general and administrative expenses of TRAQ Pvt Ltd. post-acquisition in May 2019, and incurring a full year of administrative expenses for TRAQ Pvt Ltd rather than seven and a half months in 2019.

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Interest Expense, net

For the year ended December 31, 2020 compared to December 31, 2019, the Company’s interest expense, net of interest income increased by $78,216, or 31%, from $250,164 in 2019 to $328,380 in 2020 due to higher levels of debt in 2020.

Forgiveness of Debt and Other Income

For the year ended December 31, 2020 compared to December 31, 2019, the Company’s forgiveness of debt and other income increased by $20,798 or 38%, from $55,450 in 2019 to $76,248 in 2020 due to forgiveness of payables in TRAQ Pvt Ltd in 2020 and due to PPP loan forgiveness of $24,640 in 2020.

Included in other income is $417,148 in 2019 for the recognized bargain purchase gain.

Net Loss

For the year ended December 31, 2020 compared to December 31, 2019, the Company’s net loss increased by $384,700, or 163%, from $223,209 in 2019 to $607,909 in 2020 due to the increase in activity in TRAQ Pvt Ltd as we incurred one year of activity in 2020 rather than seven and a half months in 2019, as well as the added interest expense due to the increase in debt we incurred in 2020.

Liquidity and Capital Resources

As of June 30, 2021, current assets were $1,296,438 and current liabilities outstanding were $9,416,816 which resulted in a working capital deficit of $8,120,378. As of December 31, 2020, current assets were $1,101,439 and current liabilities outstanding were $3,953,160 which resulted in a working capital deficit of $2,851,721.

Net cash used in operating activities was $1,209,094 for the six months ended June 30, 2020 compared to $15,288 in 2021. Cash used in operations for 2021 and 2020 was primarily related to the loss in operations offset by increases and decreases in accounts payable and accrued expenses and the changes in accounts receivable due to the lack of adequate cash flow of the Company as well as non-cash charges related to stock based compensation.

On January 19, 2021, the Company issued a 12% Convertible Promissory Note to GS Capital Partners, LLC (the “GS Note”) in the principal amount of $125,000. The GS Note has a maturity date of one-year from issuance and is to be repaid commencing on the fifth monthly anniversary and every month thereafter in the amount of $20,000. In the event of a payment default, the GS Note will be convertible into common stock at a conversion price of 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon the Company repaying the GS Note in accordance with its terms.

On February 12, 2021, the Company issued a 10% Convertible Promissory Note to Platinum Point Capital, LLC (the “Platinum Note”) in the principal amount of $400,000. The Platinum Note has a maturity date of one-year from issuance. The Platinum Note is convertible into common stock a conversion price of the greater of (a) $0.01 or (b) 70% of the lowest traded stock price over the previous 15 trading days, provided that the conversion price will not exceed $1.00. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 200,000 warrants to purchase shares of common stock that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 60,000 shares of common stock as a commitment fee.

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The only investing activities for the six months ended June 30, 2021 and 2020, related to the acquisitions of fixed assets related to TRAQ Pvt Ltd. and the amount of cash received (paid) in the acquisitions of Rohuma and Mimo Technologies.

Net cash provided by financing activities for the six months ended June 30, 2021 consisted of proceeds from the issuance of common stock of $494,500 and convertible notes of $515,000, along with proceeds received from related party notes of $1,122,096 and $50,331 in proceeds from issuance of long-term debt. The Company repaid $681,968 in related party notes, $20,000 in convertible notes and $96,499 in long-term debt during the six months ended June 30, 2021. During the six months ended June 30, 2020 the financing activities consisted of proceeds from related party and unrelated party notes of $187,556 as well as repayments of long-term debt to both related and unrelated parties of $50,284.

As of December 31, 2020, current assets were $1,101,439 and current liabilities outstanding were $3,953,160 which resulted in a working capital deficit of $2,851,721. As of December 31, 2019, current assets were $818,830 and current liabilities outstanding were $3,515,866 which resulted in a working capital deficit of $2,697,036.

Net cash used in operating activities was $187,164 for the year ended December 31, 2020 compared to $516,509 in 2019. Cash used in operations for 2020 and 2019 was primarily related to the loss in operations offset by the bargain purchase gain in 2019, increases in accounts payable and accrued expenses and the changes in accounts receivable due to the lack of adequate cash flow of the Company.

The only investing activities for the year ended December 31, 2019, related to the cash and restricted cash of $234 and $185,399, respectively acquired in the TRAQ Pvt Ltd. acquisition and some acquisitions of fixed assets related to TRAQ Pvt Ltd. of $3,417. In the year ended December 31, 2020, the investing activities related to the advance in the form of a note receivable in the amount of $227,877. In 2020 and 2019 we had acquisitions of fixed assets of $3,709 and $3,417, respectively.

Net cash provided by financing activities for the year ended December 31, 2020 was $285,433 compared to $523,667 for the year ended December 31, 2019. The cash provided by financing activities was the result of the issuance of long-term debt, including related parties, convertible notes from related and unrelated parties, offset by repayments on long term-debt which include related parties, as well as the decreases in our cash overdraft in both years.

Off-Balance Sheet Arrangements

We have no off-balance sheet financing arrangements.

Contractual Obligations

Not required for a smaller reporting company.

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BUSINESS

Overview

TraQiQ (or the “Company”) helps businesses leverage the “gig” or task economy by providing both technology solutions and a network of workers required to fulfill those tasks. TraQiQ offers software that enables clients to build and manage a network of contractors referred to as “task workers.” This platform is also used by business clients to manage their employees who are performing services, such as PC repair or food delivery, for example, in a large geographic area. TraQiQ’s Mimo service operates a network of 14,000+ task workers in India. These task workers are independent contractors who make deliveries, collect payments, do background verifications, and fulfill tasks across the supply chain, as needed by businesses to deliver their products and services to their respective markets and customers.

Our Company

With current operations concentrated in India, Southeast Asia, and Latin America, we are servicing business supply chains with last mile delivery and mobile commerce. We help businesses in emerging markets leverage the gig economy with a two-prong approach as follows: 1) We offer our software as a service so our customers can build their own delivery networks and 2) We currently offer our network of over 14,000 task workers in India through our Mimo network, with plans to expand this network into other geographic regions within our current operating footprint.

The Company has 110 employees focused primiarly on software development and Mimo network operations, and a strategic planning team comprised of industry consultants who are looking at ways to further disrupt the supply chain across major industry segments. TraQiQ is continually looking at innovative ways to meet cutomer requirements faster, utilizing artificial intelligence (“AI”) tools to improve the customer experience by trying to predict their requirements in advance, while also regularly experimenting with new hardware technology like drones to improve deliveries. As we identify areas of both improvement and opportunity, our technology team works rapidly to meet those requirements.

With a strong team in place, a proven software solution, and an expanding network, as well as a customer base with global opearations, TraQiQ expects to expand into two new countries in the next twelve months. These markets will be in South East Asia and Latin America, where the company already has a presence, and for which this contemplated expansion will be faciltated by and accelerated, in part, with anticipated proceeds from this offering.

Market opportunity

The gig economy has grown over the last decade with the introduction of notable digital platforms such as Lyft, Uber, DoorDash Ola, Grab, Swiggy, Dunzo, and Task Rabbit, among others. With the rise of technology-enabled gig work platforms, more than 200 million people are now considered part of the global gig workforce, according to data from Mastercard Incorporated and Statista Inc..

With the growth of e-commerce, availability of task workers, and changes in general consumer behaviors in favor of “on-demand” products and services, we believe many businesses are increasingly moving towards, or participating in, a gig or task-based model. ASSOCHAM (India), projects the gig sector to grow to $455 billion (a cumulative annual growth rate of 17%) by 2024 in India and has the potential to expand at least two times the pre-pandemic estimates. ASSOCHAM (India) also estimates that India is likely to have 350 million gig jobs by 2025 (growing from the current 15 million as of May 2021), presenting a significant opportunity for job seekers to capitalize and adapt to the changing work dynamics.

Ernst & Young estimates that the e-pharma market in India will grow to $18 billion by 2023. We believe the COVID-19 pandemic may have accelerated this growth. Companies such as Amazon and Reliance have entered the medicine delivery market in India. TraQiQ’s Mimo service is preparing to enter the medicine delivery market in India.

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In India, gig employment is not a novel concept. With its enormous informal economy and casual workers, India has long had the equivalent of gig work in both urban and rural areas, ranging from temporary agricultural workers to daily-wage construction laborers to delivery personnel. What has changed in recent years is the use of technology to match and expand on-demand services.

In the current world where so many people are ordering products ranging from food and drinks to medicine to socks online, we believe the “Last Mile” task worker represents a very valuable asset. This is the one and only direct connection to the customer for businesses fulfilling orders online. TraQiQ believes that “Last Mile” task workers are the only way for a business to establish a two-way relationship with the end customer to exchange information, money, transaction data and the actual goods.

This is where TraQiQ adds value, and it starts long before the actual delivery. The company’s technology helps our business-to-business customers with deliveries, assists with the financial transactions, and helps to build a long-term customer relationship via the Loyalty and Rewards program.

We believe the gig-economy model provides significant benefits for everyone within the gig eco-system:

● The consumer gets instant gratification by, for example, receiving their food within an hour of ordering it.

● The employers can minimize their costs and have flexibility to increase or decrease their workforce on demand.

● Employees/contractors can have flexibility and opportunity, with the full control over their jobs, hours and who they work with provided by gig jobs.

We believe the gig economy helps companies, employees, and the economy, with benefits that go beyond traditional conceptions of convenience, on-demand availability, and flexibility. This is due to the underlying economic factors that platform-enabled gig work addresses at scale, as well as the collateral advantages it can provide, which can lead to a virtuous expansion cycle.

Our Products and Services

TraQSuite

TraQSuite is a software platform that powers the Last Mile distribution network. TraQSuite users can:

● target customers,

● facilitate and validate transactions,

● track and manage task workers, and

● manage funds and run the entire distribution network.

Key features of TraQSuite include:

● Last Mile delivery: TraQSuite’s Last-Mile software module enables a complete distribution engine. It is designed to manage thousands of task workers across multiple geographies to deliver products and services to the users. The mobile apps enable data sharing, validation, and measure customer satisfaction. The software platform allows for delivery validation, geo-tagging and know-your-customer (KYC) requirements.

● Transact: TraQSuite enables a task worker to facilitate a transaction by meeting the end customer. They can collect payments via credit cards, smart-phone swipes, SMS messages or cash. Both banked and unbanked users can buy products and services and pay with their mobile device. The multi-party settlement engine enables all members of the eco-system to settle their transactions across all vendors, currencies, and geographies.

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● Target: TraQiQ enables customer transactions to be rewarded with Loyalty Credits, tokens or points. These rewards can be redeemed by the customer for free products, discounts and benefits. TraQSuite analyzes these transactions and purchase behaviors by using leading AI models. TraQiQ can deliver real time, automated and targeted offers and recommendations for additional purchases and customer retention.

TraQSuite is a cloud based software platform with a revenue model based on initial and transaction-based licensing fees as well as consulting fees. Licensees pay an initial per-module fee that varies depending on the number of modules that are licensed. This fee is typically $10,000 per module. Customers are also billed on a per-user or per-transaction basis every month. User fees range from a $75 per month fee for the administrator to $5 per month for regular users. Transaction fees averages about $1 per transaction, with discounts for higher volumes. Most customers also pay initial consulting fees upfront for integration of TraQSuite with their legacy software and training of their employees in the use of TraQSuite.

Mimo Delivery and Task Services

TraQiQ operates the Mimo delivery and task service in India. This service runs on the TraQSuite platform. Mimo has 14,000+ independent contractors across India performing deliveries and fulfilling tasks for the largest corporations in the country. Our team at Mimo uses a sophisticated technology platform and a smartphone app to get their tasks completed. This is coupled with a verification and billing system that allows customers of all sizes to leverage this distribution infrastructure.

Mimo offers a broad set of services. These offerings can be classified into three broad categories:

● Data collection and client verification (surveys, verification, on-boarding),

● Cash management & handling services, and

● Distribution and demand generation (order fulfilment, demand generation, delivery services for e-commerce companies)

Mimo assists the delivery and pickup segment of the banking and insurance industry by performing verifications, field investigations for loan requests, business verifications and employment verification, and also collects documents, assists in filling forms for banks, and completes data collection from customers.

Mimo works with microfinance institutions to collect cash, such as loan payments, convert cash to digital means like debit cards, and conduct data collection and surveys.

For consumer goods companies, Mimo does promotional marketing, Last Mile (hyper-local) delivery, merchant onboarding or activation, store audits, and route optimization for delivery. Mimo provides efficient end-to-end transshipment logistics. The framework manages and optimizes last-mile delivery and e-commerce logistics across the entire distribution chain with transparency and seamless integration. Mimo is currently in the planning stages to provide food, alcohol & medicine deliveries as well.

During the Covid pandemic, Mimo leveraged video as a platform for verification and document delivery. Now, the task workers include people who are in the field on bikes and trucks, people on a video screen, as well as people on the phone.

There are also data digitization tasks being done by Mimo task workers across the country. In a country like India where there are over 20 languages and multiple dialects, the task workers convert paper documents into electronic form in the same language or translate them into another language.

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Revenue for the Mimo services is entirely based on the number of deliveries or other tasks that are performed. The customer is typically charged a fee of $3-$5 depending upon the geography, duration of task and distance that the task associate must travel. Two thirds of the fee is shared with the task associate, and one-third is retained by Mimo. While this revenue model has worked well in India where the services are currently offered, we may adjust it as needed as the service is offered in other geographic areas.

Customers

TraQiQ’s geographic focus is emerging and smaller economies. These are markets where we believe the barriers to entry are lower and the market potential is high.

TraQiQ is serving or has serviced a variety of large customers over the years. Some of our representative customers, most of which we are currently serving, include:

● Railtel, one of the largest broadband infrastructure providers in India, which owns and operates a nationwide fiber network that runs alongside train tracks across India and for which Mimo collects subscriber payments.

● Multiple large banking and finance industry customers, such as Hero Finance Corp, Yes bank, Aditya Birla group, ICICI bank, Ratnakar bank and Edelweiss Finance, for whom Mimo does deliveries and pickup of financial documents.

● Companies such as Facebook, for whom TraQiQ has done surveys, Verify360, for whom TraQiQ has done background verifications, and Jio, for whom the company facilitates SIM activation.

● Companies such as Unilever Cambodia, Ben & Jerry’s, Lakme and others in South East Asia and Australia/New Zealand, for whom TraQiQ facilitates contactless ice cream delivery with a unique wallet and customer retention program, cosmetics products loyalty programs, and virtual point of sale (POS) systems for remote delivery.

● A white-labelled delivery service in New Zealand, for whom TraQiQ provided a complete software platform.

● Companies in Latin America such as Seguros Bolivar, Panafoto, and BBVA, for whom TraQiQ provides FinTech products and solutions.

Although our strategy is to expand our business operations and customer base through our 2021 acquisitions of Rohuma and Mimo, most of our revenue has come historically from a few customers. For the six months ended June 30, 2021, we had two major customers comprising 87% of our revenues, and at June 30, 2021 these customers represented 87% of our accounts receivable. For the year ended December 31, 2020 and at the end of that year, these customers accounted for 85% of our revenues and our accounts receivable, respectively. We do not believe that the risk associated with these customers will have an adverse effect on our business in the future.

Growth Strategy

Our gross revenue grew by 50% from 2019 to 2020 to reach the $1 million mark. By the end of the second quarter of 2021, our gross revenue had already equaled our gross revenue for the entire 2020 calendar year. In addition to our significant presence in India, Southeast Asia and Latin America, we have recently announced new customers in Australia, New Zealand and parts of Africa.

Our strategy is to grow our business through a combination of organic growth and strategic investments that bring new functionality and revenue streams to the company. We plan to enhance the functionality of our existing products, increase sales in the Indian market and enter into new emerging markets. Our data currently shows that within the first six months our business customers have an average increase of transactions of approximately 20%, and their customer’s transactions through our software increase by 15-20% over that period.

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We believe we can continue to grow the Mimo network of task workers in India and are currently evaluating markets in Southeast Asia & Latin America for launching the Mimo service, as well. We plan to go live in at least two new markets within the next twelve months.

As hardware technology evolves, TraQiQ’s strategy is to provide additional delivery services by adding drones, e-bikes and robotic carts. The company has already had conversations with e-bike companies to equip the Mimo delivery team with electric bikes in the future.

Environmental, Social, and Governance (ESG) Matters

TraQiQ’s Mimo service provides jobs across India. Most of the people who are doing deliveries and performing tasks are not college educated. Based on our records, over 70% of our current task workers do not have a high school diploma. While many of them start with Mimo to supplement their other wages, they migrate towards spending most of their time with Mimo. Mimo gives them an opportunity to earn reasonable wages and they make their own hours. We believe many of these people would have a tough time finding jobs elsewhere due to lack of educational credentials. Many of them have grown into corporate roles at Mimo like trainers and supervisors.

Markets

In addition to its significant presence in India, Southeast Asia and Latin America, TraQiQ has recently added new customers in Australia, New Zealand and parts of Africa. Management regards Africa as having substantial growth potential. According to World Mobile Ltd., approximately 66% of sub-Saharan Africans do not have a banking relationship, but Plug and Play Tech Center estimates there are over 525 million smart phones in use in that area. We believe these customers would be likely candidates for phone-based mobile payment systems.

Competition

TraQiQ competes to some extent with several Last mile service providers with established global names as well as other service providers that are established brands in India. Unlike TraQiQ, many of these companies market directly to consumers rather than to other businesses. However, several of these competitors have significantly greater resources and name recognitions than TraQiQ.

TraQiQ’s Mimo service has a business-to-business (“B2B”) focus. This inherently results in longer term relationships with clients. We believe this, in turn, has a direct impact on longer term profitability. Mimo also has a deeper focus on semi-urban and rural areas, which we believe is a significant competitive advantage, as we believe most of our competitors have continued to focus on the larger cities. However, there is no assurance we will compete successfully or achieve profitability in the future.

We believe Mimo’s technology has some unique elements that provide strong differentiation. There are significant machine learning algorithms that power the service, enabling optimal route planning, reducing time to get a task done and minimizing agent productivity. There are modules in service that enable trackability and audit of all service elements.

We also compete with companies offering multiple software products. Larger companies have had software solutions for field-force management for a long time or have extended their products to include workforce management. Similarly, there are multiple fintech companies that offer products to facilitate transactions and payments. In the loyalty & rewards segment, there are also several companies with either a global or regional following.

TraQiQ believes its software solution is improved by its service network. We believe running a large-scale service provides a unique advantage to TraQiQ, as the real-time feedback from running the service enables the company to make continuous improvements to its software. In addition, TraQiQ goes beyond just the Last mile delivery. By providing a robust set of fintech and analytics solutions, TraQiQ provides a one-stop-shop for customers and partners.

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Employees and Human Capital Resources

As of June 30, 2021 TraQiQ had a total of 110 full time employees. Approximately 100 of these employees are based in India. None of our employees is represented by a labor union, and we consider our company culture and employee relations to be strong.

In addition, we have independent contractor relationships with approximately 14,000 “gig” workers throughout India who primarily provide delivery services and other tasks for business customers.

Intellectual Property

To date, TraQiQ has not obtained any patents on the software it has developed or registered any of its trademarks. Instead, the company protects its intellectual property rights by relying on national and local statutory and common law rights in the jurisdictions in which it operates, as well as contractual restrictions. TraQiQ enters into confidentiality and invention assignment agreements with its technical employees and contractors, and confidentiality agreements with third parties who perform technical services. Although the company is not aware that its software or trademarks infringe the patents or trademarks of any other party, it may face allegations by third parties, including its competitors, that aspects of its software or trademarks infringe their trademarks, copyrights, patents and other intellectual property rights in a particular jurisdiction.

Facilities

TraQiQ does not own any property. The company has an office with approximately 2,800 square feet that accommodates its 100 employees in India (on a rotational basis), which it occupies under a lease with a term through 2030 (with options to renew for an additional 6 years) and rent of $2,100 per month. In addition, it has Executive/Shared space in Bellevue WA, Santa Monica, CA and Bogota Colombia. Its main corporate mailing address is 14205 S.E. 36th St., Suite 100, Bellevue, WA 98006.

Legal Proceedings

From time to time, the company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm the company’s business. TraQiQ is currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse effect on its business, financial condition, operating results or cash flows. However, lawsuits or any other legal or administrative proceeding, regardless of the outcome, may result in diversion of the company’s resources, including its management’s time and attention.

Corporate History

TraQiQ was incorporated as a shell company in the State of California in 2009 under the name Thunderclap Entertainment, Inc. In 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc. and the company acquired OmniM2M, Inc. and TraQiQ Solutions, Inc. d/b/a Ci2i Services, Inc. in exchange for TraQiQ common shares, and Transport IQ in exchange for cancellation of indebtedness. In 2019, TraQiQ acquired Mann-India Technologies Private Ltd., an Indian Corporation, for warrants (and assumed debt), which then changed its name to TRAQIQ Solutions Private Limited. Effective December 31, 2020, Ci2i acquired the net assets of OmniM2M and TransportIQ, and then TraQiQ dissolved those subsidiaries in 2021. In the first quarter of 2021, TraQiQ acquired Rohuma LLC, a Delaware company, in exchange for common stock and Mimo-Technologies Pvt Ltd, an Indian corporation, for warrants (and assumed debt).

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DIRECTORS AND EXECUTIVE OFFICERS

The following persons are our executive officers and directors and hold the positions set forth opposite their respective names. The members of the Board of Directors serve until the next annual meeting and a successor is appointed and qualified, or until resignation or removal.

Name	Age	Position
Ajay Sikka	54	Chairman of the Board, Director, Chief Executive Officer and President
James DuBois	57	Director
Greg Rankich	47	Director
Richard J. Berman	79	Director
Lathika Regunathan	43	President of Mimo Technologies
Sandeep Soni	51	President of Kringle.ai
Michael Pollack	55	Interim Chief Financial Officer

Business Experience

The following is a brief description of the business experience of our executive officers and directors:

Ajay Sikka, Chairman and Director and President

Ajay Sikka was appointed to our Board as its Chairman and the Board appointed him as our Chief Executive Officer, President and Chief Financial Officer on July 19, 2017. From May 2014 to 2020, Mr. Sikka served as Chief Executive Officer of OmniM2M, Inc., an IIoT hardware, software and services company. From March 2011 to the present, Mr. Sikka has also served as Chief Executive Officer of TraQiQ Solutions, Inc. a technology provider that is focused on providing software products, services and support to enterprise customers, including Microsoft, Staples, Accenture, and Pactera. From April 2004 to Feb 2011, Mr. Sikka served as Senior Director at Microsoft Corp. in Redmond, Washington, where he worked in multiple teams, including Law & Corporate affairs, Central IT, and Business Strategy. He also managed Microsoft’s CloudCRM team that provided Customer Relationship Management (CRM) services within Microsoft. From April 2000 to March 2004, Mr. Sikka served as Chief Executive Officer of IndiaHQ Solutions, Inc., a content provider (Websites, newspapers, Yellow pages) for the South Asian community. From April 1996 to April 2000, Mr. Sikka served as Group Manager at Microsoft Corp. in Redmond, Washington where he drove Microsoft’s internet business and content management initiatives with telecommunications and Internet service providers. He arrived at Microsoft subsequent to Microsoft’s purchase of Vermeer, that made the FrontPage product. Mr. Sikka is an active angel investor and board of director member for startup companies and new ventures in the Seattle area.

Mr. Sikka is the founder and Chief Executive Officer of TraQiQ, with extensive software development and sales experience, as well as experience in the South Asian community. He offers the board an inside view of the company’s finances and operations. His service as a board member of other small companies also provides him with insight into the issues facing other small companies, which are valuable to the company.

James DuBois, Director

James DuBois is a member of our Board and was appointed to our Board on February 2, 2018. Since 2016, Mr. Dubois, has served as Global IT Advisor and Board Member at Expeditors International, a global logistics company headquartered in Seattle, Washington. Mr. Dubois has guided IT and business transformation, corporate governance, customer-focused strategic product/services development, security, and risk management. While at Microsoft, as CIO and Chief Information Security Officer from 2014 to 2017, he was involved with directing IT modernization through corporate growth, turnaround, acquisitions integrations and divestitures.

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Mr. DuBois has extensive experience in global IT operations as well as corporate governance matters, which assists TraQiQ in formulating and executing its growth strategy. He offers the board a strategic perspective on aspects of the software industry’s future.

Greg Rankich, Director

Greg Rankich is a member of our Board and was appointed to our Board on May 11, 2019. Since May 2018, Mr. Rankich has been co-founder and partner at Better U Today, which is a program designed to provide a simple and straightforward approach to help people achieve their ideal weight through food, education and lifestyle changes. Since January 2017, Mr. Rankich has also served as the managing partner of Kirkland REI, LLC which is a private real estate investment and management firm that focuses on four primary asset classes: Single Residential Properties, Multi-Family Properties, Commercial Properties and Land Acquisition. Since July 2013, Mr. Rankich has served as an Advisory Board Member of Ro Health, which is a rapidly growing medical staffing and home health agency that supplies clients and patients with healthcare providers that are kind and caring. From July 2005 to May 2018, Mr. Rankich served as the Chief Executive Officer of Xtreme Consulting Group, Inc. an $80 million in revenue international services firm focused on improving business performance. Digital Intelligence Systems acquired Xtreme on May 11, 2018. Prior to founding Xtreme, Mr. Rankich held many roles within Microsoft Corporation. In 2010, Mr. Rankich was a finalist for Ernst & Young “Entrepreneur of the Year” award. He is an active member of company boards and advisory panels and is also involved in numerous charities and non-profits in the northwest. Mr. Rankich graduated with a B.A. in International Business and a M.B.A. from Washington State University.

Mr. Rankich’s business background and management experience is valuable to the company as it continues to grow and expand its employee and “gig worker” base.

Richard Berman, Director

Richard Berman’s business career spans over 35 years of venture capital, senior management, and merger & acquisitions experience. In the past five years, Berman has served as a director of many public and private companies. Currently, he is a director of five public companies - Cryoport Inc., a cold chain logistics company, Comsovereign Holding Corp., a U.S.-based developer of 4G LTE advanced and 5G communication systems, BioVie Inc., a clinical-stage drug development company, Advaxis Inc., a clinical-stage biotechnology company, and Cuentas, Inc., a provider of mobile banking and payment solutions serving Latino and Hispanic consumers. Over the last decade he has served on the board of five companies that have reached over one billion in market capitalization - Cryoport, Advaxis, EXIDE, Internet Commerce Corporation, and Ontrak (Catasys). Previously, Berman worked at Goldman Sachs; was Senior Vice President of Bankers Trust Company, where he started the M&A and Leveraged Buyout Departments. Subsequently, he created the largest battery company in the world in the 1980’s, by merging Prestolite, General Battery and Exide to form Exide Technologies (XIDE); helped create SoHo, NYC by developing five buildings. He advised on over $4 billion M&A transactions, completing over 300 deals. Berman is a past director of the Stern School of Business of NYU where he obtained his B.S. and M.B.A. degrees. He also has U.S. and foreign law degrees from Boston College and the Hague Academy of International Law, respectively.

Mr. Berman provides the board with insights from his extensive experience in the purchase, sale and financing of businesses, his experience in financial and operational issues affecting organizations, and his knowledge of legal issues relevant to TraQiQ’s operations.

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Lathika Regunathan, President of Mimo Technologies

Besides working in finance, technology and software development in India, Lathika has worked extensively in the Latin-American markets. Beginning in 2017, he was the Founder & President at Mimo Technologies Pvt Ltd., which was subsequently acquired by TraQiQ. Prior to that time, he served as Founder & President at Mann-India Technologies Pvt Ltd, a software solutions and services company focused on the Latin American markets that was also subsequently acquired by TraQiQ. At Mimo, Lathika brings to the table a firm understanding of mobile payment strategy, team management and management consultancy.

Sandeep Soni, President of Kringle.ai

Since 2018, Mr. Soni has served as Founder and President of Rohuma LLC, building loyalty and rewards programs for other businesses. This company was acquired by TraQiQ in 2021. From 2013 to 2018, Mr. Soni served as Chief Operating Officer for Unique Business Systems, where he was responsible for global business, project management and technology development. From 2017 to the present, Mr. Soni has also served as a board member of the Blank Center for Entrepreneurship, headquartered in Boston, Massachusetts, and he previously served as a board member for other banking and public companies. Mr. Soni has on the past run a $4 billion business as chief executive officer of Citigroup’s Consumer Business unit across several countries with responsibility for credit cards, mortgages, insurance and loan products. Mr. Soni has been involved in M&A, early-stage investments and also managed a Special Situation fund helping invest and turn around companies.

Michael Pollack CPA, Interim Chief Financial Officer

Mr. Pollack joined the Company as interim Chief Financial Officer in September 2021. Mr. Pollack has been a partner in a certified public accounting firm for the past fifteen years and specializes in accounting and auditing for small public companies. Mr. Pollack has approximately 30 years of experience in public accounting and consulting to over 100 publicly traded and 250 private companies. Mr. Pollack has also held CFO and Controller positions in an array of industries. Mr. Pollack graduated from the University of Maryland with a Bachelor of Arts in Economics. Mr. Pollack is a member of the American Institute of Certified Public Accountants, as well as licensed to practice in New Jersey, and New York.

Family Relationships

There are no family relationships among any of our directors or executive officers.

Corporate Governance

Board Independence

Our board of directors currently consists of four members. Of these, our board has determined that three (Mr. DuBois, Mr. Berman and Mr. Rankich) qualify as “independent directors” under the listing standards of The Nasdaq Stock Market, Inc. and do not have any material relationships with TraQiQ that might interfere with their exercise of independent judgment. In addition, TraQiQ is a “Controlled Company” as defined in the Nasdaq listing standards because more than 50% of the company’s voting power is held by one individual. The company is, therefore, pursuant to Nasdaq Marketplace Rule 5615(c)(2), exempt from certain aspects of Nasdaq’s listing standards relating to independent directors. Nevertheless, the company has voluntarily complied with some of such rules, and a majority of the members of the board of directors are “independent directors” under Nasdaq rules.

Code of Business Conduct and Ethics

TraQiQ has adopted a Code of Ethics and Business Conduct to document the ethical principles and conduct we expect from our employees, officers and directors. The Code of Ethics and Business Conduct is applicable to our employees and also includes a Code of Ethics for our chief executive and principal financial officers and any persons performing similar functions. A copy of our Code of Ethics and Business Conduct is available in the Investors section of our website (www.traqiq.com). We will provide a copy of the Code of Ethics to any person without charge, upon request to TraQiQ, Inc., 14205 S.E. 36th St., Suite 100, Bellevue, WA 98006, Attention: Ajay Sikka, CEO.

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Board Committees

Our board of directors has established an Audit Committee and a Compensation Committee. The members of each committee are James DuBois, Richard Berman and Greg Rankich, each of whom is an independent director within the meaning of the Nasdaq Stock Market rules. Each of these board committees has the responsibilities described below. As a “controlled company” under Nasdaq listing standards, the company is not required to have a separate nominating committee, and the company has chosen to have its full board of directors continue to perform this function.

Audit Committee. The Audit Committee’s primary responsibility is to engage our independent auditors and otherwise to monitor and oversee the audit process. The Audit Committee also undertakes other related responsibilities as detailed in the Audit Committee Charter, including monitoring our internal control over financial reporting, disclosure controls and procedures and code of business conduct and ethics, discussing our risk management policies and reviewing and approving or ratifying any related person transactions. A copy of our Audit Committee Charter is available in the Investors section of our website (www.traqiq.com). In addition to determining that the members of the Audit Committee are independent directors under the Securities Exchange Act of 1934 and the Nasdaq listing standards, the board of directors has also determined that Richard Berman is an “Audit Committee financial expert” as defined in rules adopted under the Securities Exchange Act of 1934. Mr. Berman serves as chair of the Audit Committee.

Compensation Committee. The Compensation Committee provides a general review of our compensation and benefit plans to ensure that our corporate objectives are met, establishes compensation arrangements and approves compensation payments to our executive officers, and generally administers our stock option and incentive plans. A copy of our Compensation Committee Charter is available in the Investors section of our website (www.traqiq.com). Mr. Rankich serves as chair of the Compensation Committee.

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EXECUTIVE COMPENSATION

The following table shows, for the years ended December 31, 2019 and 2020, compensation awarded to or paid to, or earned by, our Chief Executive Officer and Chief Financial Officer (the “Named Executive Officers”).

Summary Compensation Table

Name and Principal Position	Year		Salary ($)		Bonus ($)		Stock Awards ($)		Option Awards (1) ($)		Non-Equity Incentive Plan Compensation ($)		All Other Compensation ($)		Total ($)
Ajay Sikka,		2019		105,700		—		—		—		—		—		105,700
Chief Executive Officer and		2020		132,646		—		—		340,600		—		—		473,246
Chief Financial Officer

(1) The fair value of each option awarded is estimated on the date of grant using a Black-Scholes option-pricing model. The expected volatility is based on the Company’s stock having just commenced trading on the grant date. The risk-free interest rate for periods within the life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. In calculating the fair value of the Company’s options on the date of grant during the year ended December 31, 2020, the Company assumed a risk-free interest rate of 0.58%, an expected dividend yield of 0%, an expected life of 2 years and an expected volatility of 100%.

Employment Agreement

In 2020 and 2019, Mr. Sikka received a salary of $132,646 and $105,700, respectively. In October 2020, the Company entered into an employment agreement with Mr. Sikka. The agreement has a five year term, subject to earlier termination. Under the agreement, he receives an annual salary of $180,000 and was issued options in connection with his service as chief executive officer to purchase up to 1.5 million shares of common stock at an exercise price of $0.055 per share. Of these, 1.25 million shares are to vest based on performance over five years with milestones. The remaining 250,000 options have service-based vesting over four years. Mr. Sikka also received options on October 19, 2020 for 250,000 shares of common stock in connection with his service on the company’s board of directors at an exercise price of $0.055 per share, which vest over one year from grant.

Grants of Plan-Based Awards

In October 2020, the Board of Directors approved the TraQiQ, Inc. 2020 Equity Incentive Plan. Under this plan our named executive officers received option grants for 1,750,000 shares of common stock during the year ended December 31, 2020. No options were issued during the year ended December 31, 2019.

Outstanding Equity Awards At Fiscal Year-End For 2020

	Option Awards							Stock Awards
	Number of Securities Underlying Unexercised Options (#)		Number of Securities Underlying Unexercised Options (1) (#)		Option Exercise Price		Option Expiration	Number of Shares or Units of Stock That Have Not Vested		Market Value of Shares or Units of Stock That Have Not Vested
Name	Exercisable		Unexercisable		($)		Date	(#)		($)
Ajay Sikka		—		1,750,000	$	0.055	10/19/2030		—		—

(1) Of Mr. Sikka’s options, 500,000 shares will vest on October 19, 2021, 250,000 shares will vest in equal parts on October 19 of each of the years 2022, 2023 and 2024, 937,500 shares have vested based on company performance to date, as determined by the board of directors, and 312,500 shares will vest based on future company performance, as determined by the board of directors.

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Director Compensation

Directors of the Company receive no compensation other than the opportunity to receive option awards.

In the table below, we have set forth information regarding compensation for 2020 received by each of our directors who is not an officer of the Company. The dollar amounts in the table below for option awards are the grant date fair market values associated with such awards.

2020 Director Compensation Table

	Fees Earned or		Stock		Option		All Other
Name	Paid in Cash		Awards		Awards (1)		Compensation		Total
James DuBois	$	—	$	—	$	48,777		—	$	48,777
Greg Rankich		—		—	$	39,022		—	$	39,022
Richard Berman		—		—		—		—		—

(1) The fair value of each option awarded is estimated on the date of grant using a Black-Scholes option-pricing model. The expected volatility is based on the Company’s stock having just commenced trading on the grant date. The risk-free interest rate for periods within the life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. In calculating the fair value of the Company’s options on the date of grant during the year ended December 31, 2020, the Company assumed a risk-free interest rate of 0.58%, an expected dividend yield of 0%, an expected life of 2 years and an expected volatility of 100%.

Directors’ and Officers’ Liability Insurance

The Company maintains directors’ and officers’ liability insurance insuring its directors and officers against liability for acts or omissions in their capacities as directors or officers, subject to certain exclusions. Such insurance also insures the Company against losses which we may incur in indemnifying our officers and directors.

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SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT

As of September 30, 2021, there were 34,859,683 shares of our common stock issued and outstanding. The following table shows, as of that date, the number of shares and percentage of our common stock held by each person known to us to own beneficially more than five percent of the issued and outstanding Common Stock, by each of our executive officers and directors, and by our executive officers and directors as a group. Unless otherwise specified, the address of each person listed is: 14205 SE 36th Street, Suite 100, Bellevue, WA 98006.

	Common Stock
Five Percent Shareholders, Directors, Nominee and Certain Executive Officers	Amount and Nature of Beneficial Ownership			Percent of Class
Ajay Sikka		18,108,677	(1)		50.2	%
James DuBois		173,542	(2)		*
Greg Rankich		69,417	(3)		*
Richard Berman		—			*
Virandra Sikka		3,264,412			9.4	%
Swarn Thiara 6704 126th Street SE Snohomish, WA 98296		2,600,000			7.5	%
Dharam Vir Sikka		1,955,307			5.6	%
Lathika Regunathan		921,152	(4)		2.6	%
Sandeep Soni		1,582,959	(5)		4.5	%
Michael Pollack		—			*
All Executive Officers and Directors as a Group (7 persons)		21,060,195	(6)		55.8	%

* Less than 1%.

(1)	Consists of 16,409,579 shares owned individually, 466,546 shares owned by his spouse and 1,232,552 shares represented by stock options exercisable currently or within 60 days of September 30, 2021.
(2)	Consists of shares represented by stock options exercisable currently or within 60 days of September 30, 2021.
(3)	Consists of shares represented by stock options exercisable currently or within 60 days of September 30, 2021.
(4)	Consists of 885,746 shares represented by warrants exercisable currently or within 60 days of September 30, 2021 and 35,406 shares represented by stock options exercisable currently or within 60 days of September 30, 2021.
(5)	Consists of 1,459,355 shares owned individually and 123,604 shares represented by stock options exercisable currently or within 60 days of September 30, 2021.
(6)	Includes 2,520,267 shares represented by stock options or warrants exercisable currently or within 60 days of September 30, 2021.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Except as described below, since January 1, 2020, there have been no transactions, whether directly or indirectly, between the Company and any of our officers or former officers, directors or former directors or their family members or any five percent or greater beneficial stockholder of the Company.

The details for amount due to related parties were as follows as of June 30, 2021 and December 31, 2020:

	June 30,		December 31,
	2021		2020
Amount due to related parties:
Ajay Sikka(1)	$	2,006,691	$	1,718,277
Kunaal Sikka(2)		15,000		15,000
Swarm Singh(3)		45,000		45,000
Satinder Thiara(4)		32,000		57,000
Dharam Sikka(5)		—		75,000
James DuBois(6)		—		20,000
Greg Rankich		400,000		—
Former directors and managers of Rohuma and Mimo		146,148		8,122
Total	$	2,644,839	$	1,930,277

(1)	These advances from the CEO are unsecured, due on demand and bear interest at 15% annually. Mr. Sikka has agreed to convert $2,000,000 in aggregate principal amount of these obligations to common stock prior to the closing of this offering at a conversion price equal to 80% of the public offering price.
(2)	Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, at 12% annual interest maturing on December 31, 2019. On June 25, 2021, the maturity of this note was extended to December 31, 2022.
(3)	Note payable to Swarn Singh, father-in-law of the CEO, entered into January 2017 ($25,000) and February 2017 ($20,000), at interest rate of 15% annually (1.25% monthly). These are unsecured loans and both loans mature December 31, 2019. On June 25, 2021, the maturity of this note was extended to December 31, 2022.
(4)	Notes payable to Satinder Thiara, spouse of the CEO, entered into May 25, 2016 ($22,000) which is due December 31, 2021, December 13, 2016 ($10,000) which is due December 31, 2021, and May 1, 2018 ($25,000) which matures December 31, 2019 at interest rate of 15% annually (1.25% monthly). One of these notes was converted into common stock in March 2021, and the maturity of the other two notes was extended to December 31, 2022.
(5)	The Company entered into convertible notes with Dharam V. Sikka, father of CEO, pursuant to a convertible note payable issued in August 2017 ($20,000), November 2017 ($30,000) and May 2018 ($25,000), with an interest rate of 6% and conversion terms as the Notes described above, maturing on December 31, 2019 and is convertible into shares of the Company’s common stock at a conversion rate equal to eighty percent (80%) of the average closing share price as quoted on the OTC Markets for the five (5) trading days prior to the date of conversion., These notes were converted into common stock in March 2021.
(6)	The Company entered into a convertible note with James DuBois, a director of the Company in November 2017 in the amount of $20,000, at a 6% annual interest rate and conversion terms as the Notes described in (5) above, initially maturing on July 31, 2018, extended to December 31, 2019, This note was converted into common stock in March 2021.

Policy on Future Related Party Transactions

The Company requires that any related party transactions must be approved by a majority of the Company’s independent directors.

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DESCRIPTION OF CAPITAL STOCK

Under our Articles of Incorporation, we are authorized to issue up to 300,000,000 shares of common stock, par value $0.0001 per share, and 10,000,000 shares of preferred stock, $0.0001 par value per share, 50,000 shares of which are designated Series A Preferred Stock. As of the date of this prospectus, there are 34,859,683-shares of common stock and no shares of Series A Preferred Stock issued and outstanding.

Common Stock

Each share of common stock entitles the holder to one vote, either in person or by proxy, at meetings of shareholders. The holders of our common stock:

● have equal ratable rights to dividends from funds legally available if and when declared by our Board of Directors;

● are entitled to share ratably in all our assets available for distribution to holders of common stock upon liquidation, dissolution or winding up of our affairs;

● do not have preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights; and

● are entitled to one non-cumulative vote per share on all matters on which stockholders may vote except for voting for the election of directors.

Preferred Stock

The authorized shares of preferred stock may be issued with such designations, preferences, limitations and relative rights as the company’s board of directors may authorize, including but not limited to:

● the distinctive designation of each series and the number of shares that will constitute such series;

● the voting rights, if any, of shares of such series;

● the dividend rate on the shares of such series, any restriction, limitation or condition upon the payment of such dividends, whether dividends shall be cumulative, and the dates on which dividends are payable;

● the prices at which, and the terms and conditions on which, the shares of such series may be redeemed, if such shares are redeemable;

● the purchase or sinking fund provisions, if any, for the purchase or redemption of shares of such series;

● any preferential amount payable upon shares of such series in the event of the liquidation, dissolution or winding-up of the Company or the distribution of its assets; and

● the prices or rates of conversion at which, and the terms and conditions of which, the shares of such series may be converted into other securities, if such shares are convertible.

The board of directors of the company has designated a series of preferred shares consisting of up to 50,000 shares, designated Series A Preferred Stock, none of which are currently outstanding. The terms of the Series A Preferred Stock are as follows:

● Dividends. No dividends are due and payable on the Series A Preferred Stock.

● Liquidation Preference. In the event of any liquidation, dissolution or winding up of the affairs of the company, the holders of the Series A Preferred Stock are entitled to be paid out of the assets of the company legally available for distribution to its shareholders liquidating distributions in cash or property at its fair market value as determined by the company’s board of directors in the amount of a liquidation preference before any distribution of assets is made to holders of common stock or any other capital shares that rank junior to the Series A Preferred Stock as to liquidation rights. After payment of the full amount of the liquidating distributions to which they are entitled, the holders of Series A Preferred Stock will have no right or claim to any of the remaining assets of the company. Neither the purchase or redemption by the company of stock of any class, by any manner permitted by law, nor the consolidation or merger of the Company with or into any other entity or the sale, lease, transfer or conveyance of all or substantially all of the property or business of the company shall be deemed to constitute a liquidation, dissolution or winding up of the company.

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● Conversion. Holders of Series A Preferred Stock may convert their shares at any time into shares of common stock at a ratio equal to the stated value of such shares divided by a conversion price equal to 85% of the average closing bid price of the common stock over the 20 trading days immediately preceding the date of conversion. This conversion price is subject to adjustment upon certain events, including (1) the payment of distributions payable in capital stock on the common stock or any other class of our shares junior to the Series A Preferred Stock; (2) the issuance to all holders of common shares of evidences of our indebtedness or certain rights or warrants entitling them to subscribe for or purchase common stock at a price per share less than the fair market value per share of common stock; or (3) subdivisions, combinations and reclassifications of common shares. If the company is a party to any transaction (including, without limitation, a merger, consolidation, statutory share exchange, tender offer for all or substantially all of its common shares or sale of all or substantially all of its assets), in each case as a result of which the common shares will be converted into the right to receive securities or other property (including cash or any combination of property or securities and cash), each share of Series A Preferred Stock, if convertible after the consummation of the transaction, will then be convertible into the kind and amount of shares of stock and other securities and property receivable (including cash) upon the consummation of such transaction by a holder of that number of common shares or fraction of common shares into which one share of Series A Preferred Stock was convertible immediately prior to such transaction.

● Voting. In any matter in which the company’s stockholders are entitled to vote, including any action by written consent, each share of Series A Preferred Stock is entitled to 50,000 votes

● Other Provisions. The Series A Preferred Stock has no stated maturity and is not subject to any sinking fund or mandatory redemption provisions.

The issuance of Preferred Stock, or the issuance of rights to purchase such shares, could discourage an unsolicited acquisition proposal.

Underwriters’ Warrants

We have agreed to issue to the representative or its designees, at the closing of this offering, warrants to purchase               shares of common stock (5% of the number of shares sold in the offering). The underwriters’ warrants will be exercisable at any time, and from time to time, in whole or in part, during the four-and-a-half year period commencing six months from the effective date of the registration statement at a per share exercise price equal to 125% of the public offering price per share of common stock in the offering.

The exercise price and number of shares of common stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary cash dividend or our recapitalization, reorganization, merger or consolidation. However, the warrant exercise price or underlying shares will not be adjusted for issuances of shares of common stock at a price below the warrant exercise price.

The underwriters’ warrants and underlying shares are included in this prospectus.

Transfer Agent

The transfer agent and registrar for our common stock is Equity Stock Transfer, LLC, located at 237 W 37th St. Suite 602, New York, NY 10018.

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California Anti-Takeover Law and Certain Charter and Bylaw Provisions

Approval of Merger. Under the California General Corporation Law (the “CGCL”), most business combinations, including mergers, consolidations and sales of substantially all of the assets of a California corporation, must be approved by the vote of the holders of at least a majority of the outstanding shares of common stock and any other affected class of stock of such corporation. The articles of incorporation or bylaws of a California corporation may, but are not required to, set a higher standard for approval of such transactions. Our amended articles of incorporation and amended bylaws will not set higher limits.

California Law. We are subject to the provisions of Section 1203 of the CGCL, which contains provisions that may have the effect of deterring hostile takeovers or delaying or preventing changes in control in which our shareholders could receive a premium for their shares or other changes in our management. First, if an “interested party” makes an offer to purchase the shares of some or all of our existing shareholders, we must obtain an affirmative opinion in writing as to the fairness of the offering price prior to completing the transaction. California law considers a person to be an “interested party” if the person directly or indirectly controls our company, if the person is directly or indirectly controlled by one of our officers or directors, or if the person is an entity in which one of our executive officers or directors holds a material financial interest. If, after receiving an offer from such an “interested person”, we receive a subsequent offer from a neutral third party at least 10 days prior to the date for acceptance of the tendered shares or the vote or notice of shareholder approval of the offer from such an “interested person”, then we must notify our shareholders of such third party offer and afford each of them the opportunity to withdraw their vote, consent or proxy previously given to the “interested party” offer before such vote, consent or proxy becomes effective.

We are also subject to other provisions of the CGCL, which include voting requirements that may also have the effect of deterring hostile takeovers, disposing of our assets or delaying or preventing changes in control of our management. Under Section 1101 of the CGCL, except in (i) a short-form merger or (ii) a merger of a corporation into a subsidiary in which it owns at least 90% of the outstanding shares of each class, if a single entity or constituent corporation owns more than 50% of any class of our capital stock and attempts to merge our Company into itself or other constituent corporation, the Company’s non-redeemable securities may only be exchanged for non-redeemable securities of the surviving entity, unless all of the shareholders of the applicable class of non-redeemable securities consent to the transaction and except as provided in Section 407 of the CGCL regarding the issuance and disposition of fractional shares. Section 1001(d) of the CGCL provides that any proposed sale or disposition of all or substantially all of our assets to any other corporation that we are controlled by or under common control with must be consented to by our shareholders holding at least 90% of the of the voting power of our capital stock or approved and determined fair by the DFPI, provided, however that this restriction does not apply if the disposition is to a domestic or foreign corporation or other business entity in consideration of the nonredeemable common shares or nonredeemable equity securities of the acquiring party or its parent. Sections 1101 and 1001 of the CGCL could make it significantly more difficult for a third party to acquire control of our Company by preventing a possible acquirer from cashing out minority shareholders or selling substantially all of our assets to a related party and therefore could discourage a hostile bid, or delay, prevent or deter entirely a merger, acquisition or tender offer in which our shareholders could receive a premium for their shares, or effect a proxy contest for control of us or other changes in our management.

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UNDERWRITING

ThinkEquity LLC is acting as representative of the underwriters of the offering. We have entered into an underwriting agreement dated             , 2021 with the representative. Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to each underwriter named below, and each underwriter named below has severally agreed to purchase, at the public offering price less the underwriting discounts set forth on the cover page of this prospectus, the number of shares of common stock listed next to its name in the following table:

Underwriter	Number of Shares
ThinkEquity LLC
Total

The underwriters are committed to purchase all the shares offered by us, other than those covered by the over-allotment option to purchase additional shares described below, if they purchase any shares. The obligations of the underwriters may be terminated upon the occurrence of certain events specified in the underwriting agreement. Furthermore, pursuant to the underwriting agreement, the underwriters’ obligations are subject to customary conditions, representations and warranties contained in the underwriting agreement, such as receipt by the underwriters of officers’ certificates and legal opinions.

We have agreed to indemnify the underwriters against specified liabilities, including liabilities under the Securities Act, and to contribute to payments the underwriters may be required to make in respect thereof.

The underwriters are offering the shares subject to prior sale, when, as and if issued to and accepted by them, subject to approval of legal matters by their counsel and other conditions specified in the underwriting agreement. The underwriters reserve the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part.

We have granted the underwriters an over-allotment option. This option, which is exercisable for up to 45 days after the date of this prospectus, permits the underwriters to purchase up to an aggregate of additional shares of common stock (equal to 15% of the shares of common stock sold in the offering) in any combination thereof, at the public offering price per share, less underwriting discounts and commissions, solely to cover over-allotments, if any. If this option is exercised in full, the total price to the public will be $             and the total net proceeds, before expenses, to us will be $            .

Discounts, Commissions and Reimbursement

The following table shows the public offering price, underwriting discount and proceeds, before expenses, to us. The information assumes either no exercise or full exercise by the underwriters of their over-allotment option.

	Per Share	Total with No Over-Allotment	Total with Over-Allotment
Public offering price
Underwriting discount (7.0%)
Non-accountable expense allowance (1.0%)(1)
Proceeds, before expenses, to us

(1) We have agreed to pay a non-accountable expense allowance to the representative equal to 1.0% of the gross proceeds received in this offering.

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The underwriters propose to offer the shares to the public at the public offering price set forth on the cover of this prospectus. In addition, the underwriters may offer some of the shares to other securities dealers at such price less a concession not in excess of $                           per share. If all of the shares offered by us are not sold at the public offering price, the representative may change the offering price and other selling terms by means of a supplement to this prospectus.

We have also agreed to pay certain expenses of the representative relating to the offering, including: (a) fees, expenses and disbursements relating to background checks of our officers and directors, in an aggregate amount not to exceed $15,000; (b) the costs associated with bound volumes of the public offering materials as well as commemorative mementos and Lucite tombstones, up to $3,000; (c) $29,500 for fees and expenses for the underwriters’ use of book-building, prospectus tracking and compliance software for this offering; (d) the fees and expenses of the representative’s legal counsel, up to $125,000; (e) up to $10,000 for data services and communications expenses; (f) up to $30,000 of the representative’s market making and trading and clearing firm settlement expenses for the offering; and (g) up to $10,000 of the representative’s actual accountable road show expenses for the offering.

We have paid an advance of $40,000 to the representative, which will be applied against actual out-of-pocket accountable expenses and reimbursed to the Company to the extent any portion thereof is not actually incurred in compliance with FINRA Rule 5110(f)(2)(C).

We estimate that the total expenses of the offering payable by us, excluding the total underwriting discount, will be approximately $                   .

Underwriters’ Warrants

We have also agreed to issue to the representative or its designees, at the closing of this offering, warrants (the “Underwriters’ Warrants”) to purchase                 shares of common stock (5% of the number of shares sold in the offering). The Underwriters’ Warrants will be exercisable at any time and from time to time, in whole or in part, during a four-and-a-half year period commencing six months from the effective date of this offering. The Underwriters’ Warrants will be exercisable at a price equal to 125% of the public offering price per share.

Discretionary Accounts

The underwriters do not intend to confirm sales of the securities offered hereby to any accounts over which they have discretionary authority.

Lock-Up Agreements

Pursuant to “lock-up” agreements, we and our executive officers and directors and holders of 5% or more our outstanding common stock have agreed, subject to limited exceptions, without the prior written consent of the representative not to directly or indirectly offer to sell, sell, pledge or otherwise transfer or dispose of any of shares of (or enter into any transaction or device that is designed to, or could be expected to, result in the transfer or disposition by any person at any time in the future of) our common stock, enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any of the economic benefits or risks of ownership of shares of our common stock, make any demand for or exercise any right or cause to be filed a registration statement, including any amendments thereto, with respect to the registration of any shares of common stock or securities convertible into or exercisable or exchangeable for common stock or any of our other securities or publicly disclose the intention to do any of the foregoing, subject to customary exceptions, for a period of 90 days with respect to the Company and holders of 5% or more our outstanding common stock and 180 days from the date of this prospectus with respect to our executive officers and directors. We have also agreed that we will not, for a period of 12 months from the closing of the offering, without the consent of the representative, enter into any “at-the-market”, continuous equity or variable rate transaction, subject to certain exceptions.

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Right of First Refusal

We have granted the representative a right of first refusal, for a period of 24 months from the consummation of this offering, to act as sole investment banker, book-runner and/or placement agent, at the representative’s sole discretion, for each and every future public and private equity offering, including all equity linked financings (each, a “Subject Transaction”), during such 24 month period, of the Company, or any successor to or subsidiary of the Company, on terms and conditions customary to the representative for such Subject Transactions.

Electronic Offer, Sale and Distribution of Securities

A prospectus in electronic format may be made available on the websites maintained by one or more of the underwriters or selling group members. The representative may agree to allocate a number of securities to underwriters and selling group members for sale to its online brokerage account holders. Internet distributions will be allocated by the underwriters and selling group members that will make internet distributions on the same basis as other allocations. Other than the prospectus in electronic format, the information on these websites is not part of, nor incorporated by reference into, this prospectus or the registration statement of which this prospectus forms a part, has not been approved or endorsed by us, and should not be relied upon by investors.

Stabilization

In connection with this offering, the underwriters may engage in stabilizing transactions, over-allotment transactions, syndicate-covering transactions, penalty bids and purchases to cover positions created by short sales.

Stabilizing transactions permit bids to purchase shares so long as the stabilizing bids do not exceed a specified maximum, and are engaged in for the purpose of preventing or retarding a decline in the market price of the shares while the offering is in progress.

Over-allotment transactions involve sales by the underwriters of shares in excess of the number of shares the underwriters are obligated to purchase. This creates a syndicate short position which may be either a covered short position or a naked short position. In a covered short position, the number of shares over-allotted by the underwriters is not greater than the number of shares that they may purchase in the over-allotment option. In a naked short position, the number of shares involved is greater than the number of shares in the over-allotment option. The underwriters may close out any short position by exercising their over-allotment option and/or purchasing shares in the open market.

Syndicate covering transactions involve purchases of shares in the open market after the distribution has been completed in order to cover syndicate short positions. In determining the source of shares to close out the short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared with the price at which they may purchase shares through exercise of the over-allotment option. If the underwriters sell more shares than could be covered by exercise of the over-allotment option and, therefore, have a naked short position, the position can be closed out only by buying shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that after pricing there could be downward pressure on the price of the shares in the open market that could adversely affect investors who purchase in the offering.

Penalty bids permit the representative to reclaim a selling concession from a syndicate member when the shares originally sold by that syndicate member are purchased in stabilizing or syndicate covering transactions to cover syndicate short positions.

These stabilizing transactions, syndicate covering transactions and penalty bids may have the effect of raising or maintaining the market price of our shares of common stock or preventing or retarding a decline in the market price of our shares of common stock. As a result, the price of our common stock in the open market may be higher than it would otherwise be in the absence of these transactions. Neither we nor the underwriters make any representation or prediction as to the effect that the transactions described above may have on the price of our common stock. These transactions may be effected in the over-the-counter market or otherwise and, if commenced, may be discontinued at any time.

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Passive Market Making

In connection with this offering, underwriters and selling group members may engage in passive market making transactions in our common stock on the Nasdaq Global Market in accordance with Rule 103 of Regulation M under the Exchange Act, during a period before the commencement of offers or sales of the shares and extending through the completion of the distribution. A passive market maker must display its bid at a price not in excess of the highest independent bid of that security. However, if all independent bids are lowered below the passive market maker’s bid, then that bid must then be lowered when specified purchase limits are exceeded.

Other Relationships

Certain of the underwriters and their affiliates have in the past and may in the future provide various investment banking, commercial banking and other financial services for us and our affiliates for which they may in the future receive customary fees. Without limiting the generality of the foregoing, ThinkEquity LLC acted as the placement agent for the private placement of convertible notes we completed in September 2021, for which it received compensation.

Offer Restrictions Outside the United States

Other than in the United States, no action has been taken by us or the underwriters that would permit a public offering of the securities offered by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.

Australia

This prospectus is not a disclosure document under Chapter 6D of the Australian Corporations Act, has not been lodged with the Australian Securities and Investments Commission and does not purport to include the information required of a disclosure document under Chapter 6D of the Australian Corporations Act. Accordingly, (i) the offer of the securities under this prospectus is only made to persons to whom it is lawful to offer the securities without disclosure under Chapter 6D of the Australian Corporations Act under one or more exemptions set out in section 708 of the Australian Corporations Act, (ii) this prospectus is made available in Australia only to those persons as set forth in clause (i) above, and (iii) the offeree must be sent a notice stating in substance that by accepting this offer, the offeree represents that the offeree is such a person as set forth in clause (i) above, and, unless permitted under the Australian Corporations Act, agrees not to sell or offer for sale within Australia any of the securities sold to the offeree within 12 months after its transfer to the offeree under this prospectus.

Canada

The shares of common stock may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the securities must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable securities laws.

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Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus (including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for particulars of these rights or consult with a legal advisor.

China

The information in this document does not constitute a public offer of the securities, whether by way of sale or subscription, in the People’s Republic of China (excluding, for purposes of this paragraph, Hong Kong Special Administrative Region, Macau Special Administrative Region and Taiwan). The securities may not be offered or sold directly or indirectly in the PRC to legal or natural persons other than directly to “qualified domestic institutional investors.”

European Economic Area—Belgium, Germany, Luxembourg and Netherlands

The information in this document has been prepared on the basis that all offers of securities will be made pursuant to an exemption under the Directive 2003/71/EC (“Prospectus Directive”), as implemented in Member States of the European Economic Area (each, a “Relevant Member State”), from the requirement to produce a prospectus for offers of securities.

An offer to the public of securities has not been made, and may not be made, in a Relevant Member State except pursuant to one of the following exemptions under the Prospectus Directive as implemented in that Relevant Member State:

● to legal entities that are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;

● to any legal entity that has two or more of (i) an average of at least 250 employees during its last fiscal year; (ii) a total balance sheet of more than €43,000,000 (as shown on its last annual unconsolidated or consolidated financial statements) and (iii) an annual net turnover of more than €50,000,000 (as shown on its last annual unconsolidated or consolidated financial statements);

● to fewer than 100 natural or legal persons (other than qualified investors within the meaning of Article 2(1)(e) of the Prospectus Directive) subject to obtaining the prior consent of the Company or any underwriter for any such offer; or

● in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of securities shall result in a requirement for the publication by the Company of a prospectus pursuant to Article 3 of the Prospectus Directive.

France

This document is not being distributed in the context of a public offering of financial securities (offre au public de titres financiers) in France within the meaning of Article L.411-1 of the French Monetary and Financial Code (Code Monétaire et Financier) and Articles 211-1 et seq. of the General Regulation of the French Autorité des marchés financiers (“AMF”). The securities have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in France.

This document and any other offering material relating to the securities have not been, and will not be, submitted to the AMF for approval in France and, accordingly, may not be distributed or caused to distributed, directly or indirectly, to the public in France.

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Such offers, sales and distributions have been and shall only be made in France to (i) qualified investors (investisseurs qualifiés) acting for their own account, as defined in and in accordance with Articles L.411-2-II-2° and D.411-1 to D.411-3, D.744-1, D.754-1 ;and D.764-1 of the French Monetary and Financial Code and any implementing regulation and/or (ii) a restricted number of non-qualified investors (cercle restreint d’investisseurs) acting for their own account, as defined in and in accordance with Articles L.411-2-II-2° and D.411-4, D.744-1, D.754-1; and D.764-1 of the French Monetary and Financial Code and any implementing regulation.

Pursuant to Article 211-3 of the General Regulation of the AMF, investors in France are informed that the securities cannot be distributed (directly or indirectly) to the public by the investors otherwise than in accordance with Articles L.411-1, L.411-2, L.412-1 and L.621-8 to L.621-8-3 of the French Monetary and Financial Code.

Ireland

The information in this document does not constitute a prospectus under any Irish laws or regulations and this document has not been filed with or approved by any Irish regulatory authority as the information has not been prepared in the context of a public offering of securities in Ireland within the meaning of the Irish Prospectus (Directive 2003/71/EC) Regulations 2005 (the “Prospectus Regulations”). The securities have not been offered or sold, and will not be offered, sold or delivered directly or indirectly in Ireland by way of a public offering, except to (i) qualified investors as defined in Regulation 2(l) of the Prospectus Regulations and (ii) fewer than 100 natural or legal persons who are not qualified investors.

Israel

The securities offered by this prospectus have not been approved or disapproved by the Israeli Securities Authority (the ISA), nor have such securities been registered for sale in Israel. The shares may not be offered or sold, directly or indirectly, to the public in Israel, absent the publication of a prospectus. The ISA has not issued permits, approvals or licenses in connection with the offering or publishing the prospectus; nor has it authenticated the details included herein, confirmed their reliability or completeness, or rendered an opinion as to the quality of the securities being offered. Any resale in Israel, directly or indirectly, to the public of the securities offered by this prospectus is subject to restrictions on transferability and must be effected only in compliance with the Israeli securities laws and regulations.

Italy

The offering of the securities in the Republic of Italy has not been authorized by the Italian Securities and Exchange Commission (Commissione Nazionale per le Società e la Borsa, or “CONSOB”) pursuant to the Italian securities legislation and, accordingly, no offering material relating to the securities may be distributed in Italy and such securities may not be offered or sold in Italy in a public offer within the meaning of Article 1.1(t) of Legislative Decree No. 58 of 24 February 1998 (“Decree No. 58”), other than:

● to Italian qualified investors, as defined in Article 100 of Decree no.58 by reference to Article 34-ter of CONSOB Regulation no. 11971 of 14 May 1999 (“Regulation no. 1197l”) as amended (“Qualified Investors”); and

● in other circumstances that are exempt from the rules on public offer pursuant to Article 100 of Decree No. 58 and Article 34-ter of Regulation No. 11971 as amended.

Any offer, sale or delivery of the securities or distribution of any offer document relating to the securities in Italy (excluding placements where a Qualified Investor solicits an offer from the issuer) under the paragraphs above must be:

● made by investment firms, banks or financial intermediaries permitted to conduct such activities in Italy in accordance with Legislative Decree No. 385 of 1 September 1993 (as amended), Decree No. 58, CONSOB Regulation No. 16190 of 29 October 2007 and any other applicable laws; and

● in compliance with all relevant Italian securities, tax and exchange controls and any other applicable laws.

50

Any subsequent distribution of the securities in Italy must be made in compliance with the public offer and prospectus requirement rules provided under Decree No. 58 and the Regulation No. 11971 as amended, unless an exception from those rules applies. Failure to comply with such rules may result in the sale of such securities being declared null and void and in the liability of the entity transferring the securities for any damages suffered by the investors.

Japan

The securities have not been and will not be registered under Article 4, paragraph 1 of the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948), as amended (the “FIEL”) pursuant to an exemption from the registration requirements applicable to a private placement of securities to Qualified Institutional Investors (as defined in and in accordance with Article 2, paragraph 3 of the FIEL and the regulations promulgated thereunder). Accordingly, the securities may not be offered or sold, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan other than Qualified Institutional Investors. Any Qualified Institutional Investor who acquires securities may not resell them to any person in Japan that is not a Qualified Institutional Investor, and acquisition by any such person of securities is conditional upon the execution of an agreement to that effect.

Portugal

This document is not being distributed in the context of a public offer of financial securities (oferta pública de valores mobiliários) in Portugal, within the meaning of Article 109 of the Portuguese Securities Code (Código dos Valores Mobiliários). The securities have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in Portugal. This document and any other offering material relating to the securities have not been, and will not be, submitted to the Portuguese Securities Market Commission (Comissăo do Mercado de Valores Mobiliários) for approval in Portugal and, accordingly, may not be distributed or caused to distributed, directly or indirectly, to the public in Portugal, other than under circumstances that are deemed not to qualify as a public offer under the Portuguese Securities Code. Such offers, sales and distributions of securities in Portugal are limited to persons who are “qualified investors” (as defined in the Portuguese Securities Code). Only such investors may receive this document and they may not distribute it or the information contained in it to any other person.

Sweden

This document has not been, and will not be, registered with or approved by Finansinspektionen (the Swedish Financial Supervisory Authority). Accordingly, this document may not be made available, nor may the securities be offered for sale in Sweden, other than under circumstances that are deemed not to require a prospectus under the Swedish Financial Instruments Trading Act (1991:980) (Sw. lag (1991:980) om handel med finansiella instrument). Any offering of securities in Sweden is limited to persons who are “qualified investors” (as defined in the Financial Instruments Trading Act). Only such investors may receive this document and they may not distribute it or the information contained in it to any other person.

Switzerland

The securities may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange (“SIX”) or on any other stock exchange or regulated trading facility in Switzerland. This document has been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland. Neither this document nor any other offering material relating to the securities may be publicly distributed or otherwise made publicly available in Switzerland.

51

Neither this document nor any other offering material relating to the securities have been or will be filed with or approved by any Swiss regulatory authority. In particular, this document will not be filed with, and the offer of securities will not be supervised by, the Swiss Financial Market Supervisory Authority (FINMA).

This document is personal to the recipient only and not for general circulation in Switzerland.

United Kingdom

Neither the information in this document nor any other document relating to the offer has been delivered for approval to the Financial Services Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Services and Markets Act 2000, as amended (“FSMA”) has been published or is intended to be published in respect of the securities. This document is issued on a confidential basis to “qualified investors” (within the meaning of section 86(7) of FSMA) in the United Kingdom, and the securities may not be offered or sold in the United Kingdom by means of this document, any accompanying letter or any other document, except in circumstances which do not require the publication of a prospectus pursuant to section 86(1) FSMA. This document should not be distributed, published or reproduced, in whole or in part, nor may its contents be disclosed by recipients to any other person in the United Kingdom.

Any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) received in connection with the issue or sale of the securities has only been communicated or caused to be communicated and will only be communicated or caused to be communicated in the United Kingdom in circumstances in which section 21(1) of FSMA does not apply to the Company.

In the United Kingdom, this document is being distributed only to, and is directed at, persons (i) who have professional experience in matters relating to investments falling within Article 19(5) (investment professionals) of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 (“FPO”), (ii) who fall within the categories of persons referred to in Article 49(2)(a) to (d) (high net worth companies, unincorporated associations, etc.) of the FPO or (iii) to whom it may otherwise be lawfully communicated (together “relevant persons”). The investments to which this document relates are available only to, and any invitation, offer or agreement to purchase will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

Pursuant to section 3A.3 of National Instrument 33-105 Underwriting Conflicts, or NI 33-105, the underwriters are not required to comply with the disclosure requirements of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.

52

LEGAL MATTERS

The validity of the securities offered hereby has been passed upon for us by Hoge Fenton Jones & Appel, Inc. Sichenzia Ross Ference LLP is acting as counsel to the underwriters in connection with this offering.

EXPERTS

Our consolidated balance sheets as of December 31, 2019 and 2020, and the related consolidated statements of operations, stockholders’ equity (deficit), and cash flows for each of those two years have been audited by AJSH & Co. LLP, an independent registered public accounting firm, as set forth in its report appearing herein and are included in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We are a reporting company and file annual, quarterly and special reports, and other information with the Securities and Exchange Commission. Such reports and other information may be accessed at the SEC’s web site at http://www.sec.gov, which contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC.

This prospectus is part of a registration statement on Form S-1 that we filed with the SEC. Certain information in the registration statement has been omitted from this prospectus in accordance with the rules and regulations of the SEC. We have also filed exhibits and schedules with the registration statement that are excluded from this prospectus. The registration statement may be accessed at the SEC’s website.

53

TRAQIQ, INC.

INDEX TO FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets as of December 31, 2020 and 2019	F-3
Consolidated Statements of Operations for the Years Ended December 31, 2020 and 2019	F-4
Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the Years Ended December 31, 2020 and 2019	F-5
Consolidated Statements of Cash Flows for the Years Ended December 31, 2020 and 2019	F-6
Notes to Consolidated Financial Statements, December 31, 2020 and 2019	F-7
Condensed Consolidated Balance Sheets as of June 30, 2021 (Unaudited) and December 31, 2020	F-29
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Six and Three Months Ended June 30, 2021 and 2020 (Unaudited)	F-30
Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the Six and Three Months Ended June 30, 2021 and 2020 (Unaudited)	F-31
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2021 and 2020 (Unaudited)	F-32
Notes to Condensed Consolidated Financial Statements, June 30, 2021 (Unaudited)	F-33

F-1

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors of TraqIQ, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of TraqIQ, Inc. and its subsidiaries (collectively, the “Company”) as on December 31, 2020 and December 31, 2019, the related consolidated statements of operations, changes in stockholders’ deficit and cash flows, for the years then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and December 31, 2019, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

Substantial Doubt about the Company Ability to Continue as a Going Concern

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has an accumulated deficit of $2,504,893 and working capital deficit of $2,851,721 as of December 31, 2020, and a working capital deficit of $2,697,036 as of December 31, 2019. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to this uncertainty are also described in the Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of financial statement. We believe that our audits provide a reasonable basis for our opinion.

/s/ AJSH & Co LLP

We have served as the Company’s auditor since 2019.

New Delhi, India

March 22, 2021

F-2

TRAQIQ, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2020 AND 2019

IN US$

	DECEMBER 31,			DECEMBER 31,
	2020			2019
ASSETS
Current Assets:
Cash	$	29,658		$	9,094
Accounts receivable, net		521,618			602,155
Note receivable - related party		227,877			-
Prepaid expenses and other current assets		322,286			207,581
Total Current Assets		1,101,439			818,830
Fixed assets, net		36,373			48,681
Intangible assets, net		444,584			477,824
Restricted cash		28,746			182,627
Long-term investment		40,603			41,617
Right-of-use asset		126,118			537,268
Other assets		3,196			32,639
Total Non-current Assets		679,620			1,320,656
TOTAL ASSETS	$	1,781,059		$	2,139,486
LIABILITIES AND STOCKHOLDERS’ DEFICIT
LIABILITIES
Current Liabilities:
Accounts payable and accrued expenses	$	1,163,505		$	883,845
Cash overdraft		188,721			427,890
Accrued payroll and related taxes		327,084			291,586
Accrued taxes and duties payable		46,577			50,623
Current portion - lease liability		8,779			122,343
Current portion - long-term debt - related parties		1,843,399			1,306,737
Current portion - long-term debt		133,761			191,508
Current portion - convertible debt - long-term debt - related and unrelated parties		241,334			241,334
Total Current Liabilities		3,953,160			3,515,866
Long-term debt - related parties, net of current portion		-			32,000
Long-term debt, net of current portion		59,856			19,202
Lease liability, net of current portion		125,219			432,800
Total Non-current Liabilities		185,075			484,002
Total Liabilities		4,138,235			3,999,868
Commitments and contingencies		-			-
STOCKHOLDERS’ DEFICIT
Preferred stock, par value, $0.0001, 10,000,000 shares authorized, Series A Convertible Preferred, 50,000 and 50,000 shares issued and outstanding, respectively		5			5
Common stock, par value, $0.0001, 300,000,000 shares authorized, 27,297,960 and 27,297,960 issued and outstanding, respectively		2,730			2,730
Additional paid in capital		117,261			12,623
Accumulated deficit		(2,504,893	)		(1,896,984	)
Accumulated other comprehensive income (loss)		27,721			21,244
Total Stockholders’ Deficit		(2,357,176	)		(1,860,382	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	1,781,059		$	2,139,486

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

F-3

TRAQIQ, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

IN US$

	YEARS ENDED
	DECEMBER 31,
	2020			2019
REVENUE	$	1,009,949		$	680,732
COST OF REVENUE		546,569			431,363
GROSS PROFIT (LOSS)		463,380			249,369
OPERATING EXPENSES
Salaries and salary related costs		284,258			114,615
Professional fees		201,430			287,775
Rent expense		101,845			88,863
Depreciation and amortization expense		47,988			42,840
General and administrative expenses (including stock-based compensation)		182,827			160,919
Total Operating Expenses		818,348			695,012
OPERATING LOSS		(354,968	)		(445,643	)
OTHER INCOME (EXPENSE)
Change in fair value of derivative liability
Bargain purchase gain		-			417,148
PPP forgiveness and other income		76,248			55,450
Interest expense, net of interest income		(328,380	)		(250,164	)
Total other income (expense)		(252,132	)		222,434
NET LOSS BEFORE PROVISION FOR INCOME TAXES		(607,100	)		(223,209	)
Provision for income taxes		809			-
NET LOSS	$	(607,909	)	$	(223,209	)
Other comprehensive income (loss)
Foreign currency translations adjustment		6,477			21,244
Comprehensive income (loss)	$	(601,432	)	$	(201,965	)
Net loss per share - basic and diluted	$	(0.02	)	$	(0.01	)
Weighted average common shares outstanding - basic and diluted		27,297,960			27,297,960

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

F-4

TRAQIQ, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT

FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

IN US $

									Additional					Accumulated
	Series A Preferred				Common Stock				Paid-In Capital -		Accumulated			Other Comprehensive
	Shares		Amount		Shares		Amount		Common		Deficit			Income (Loss)		Total
Balance - December 31, 2018		50,000	$	5		27,297,960	$	2,730	$	12,355	$	(1,673,775	)	$	-	$	(1,658,685	)
Acquisition of Mann-India		-		-		-		-		268		-			5,116		5,384
Net loss for the year		-		-		-		-		-		(223,209	)		16,128		(207,081	)
Balance - December 31, 2019		50,000		5		27,297,960		2,730		12,623		(1,896,984	)		21,244		(1,860,382	)
Stock-based compensation on granting of options		-		-		-		-		104,638		-			-		104,638
Net loss for the year		-		-		-		-		-		(607,909	)		6,477		(601,432	)
Balance - December 31, 2020		50,000	$	5		27,297,960	$	2,730	$	117,261	$	(2,504,893	)	$	27,721	$	(2,357,176	)

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

F-5

TRAQIQ, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

IN US$

	2020			2019
CASH FLOW FROM OPERTING ACTIVIITES
Net loss	$	(607,909	)	$	(223,209	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities
Bargain purchase gain		-			(417,148	)
Bad debt expensev		-			60,460
Forgiveness of debt		(64,725	)		(55,450	)
Depreciation and amortization		47,988			42,840
Lease cost, net of repayment		6,297			13,226
Foreign currency loss		29,587			18,882
Stock-based compensation		104,638			-
Changes in assets and liabilities
Accounts receivable		65,816			(153,492	)
Prepaid expenses and other current assets		(144,600	)		12,019
Other assets		28,647			(4,823	)
Accounts payable and accrued expenses		293,943			238,873
Accrued payroll and payroll taxes		55,967			(29,669	)
Accrued duties and taxes		(2,813	)		(15,395	)
Deferred revenue		-			(3,623	)
Total adjustments		420,745			(293,300	)
Net cash (used in) operating activities		(187,164	)		(516,509	)
CASH FLOWS FROM INVESTING ACTIVITES
Cash received in acquisition of Mann		-			234
Restricted cash received in acquisition of Mann		-			185,399
Advances of note receivable - related party		(227,877	)		-
Acquisition of fixed assets		(3,709	)		(3,417	)
Net cash (used in) provided by investing activities		(231,586	)		182,216
CASH FLOWS FROM FINANCING ACTIVITES
(Decrease) in cash overdraft		(228,745	)		(36,691	)
Proceeds from long-term debt - related parties		554,940			593,201
Repayment of long-term debt - related parties		(42,100	)		(104,841	)
Proceeds from long-term debt		197,540			143,600
Repayments of long-term debt		(196,202	)		(71,602	)
Net cash provided by financing activities		285,433			523,667
NET (DECREASE) INCREASE IN CASH AND RESTRICTED CASH		(133,317	)		189,374
CASH AND RESTRICTED CASH - BEGINNING OF PERIOD		191,721			2,347
CASH AND RESTRICTED CASH - END OF PERIOD	$	58,404		$	191,721
CASH PAID DURING THE PERIOD FOR:
Interest expense	$	84,830		$	11,782
Income taxes	$	1,609		$	-
SUMMARY OF NON-CASH ACTIVITIES:
Acquisition of Mann:
Accounts receivable	$	-		$	506,951
Prepaid and other current assets		-			216,956
Right-of-use asset		-			576,566
Fixed assets		-			68,260
Other assets		-			37,950
Investment		-			42,248
Customer relationships		-			448,800
Tradename		-			49,799
Accounts payable and accrued expenses		-			(173,197	)
Accrued payroll and related taxes		-			(325,629	)
Accrued duties and taxes		-			(66,765	)
Lease liability		-			(585,207	)
Deferred revenue		-			(3,618	)
Long-term debt		-			(90,314	)
Cash overdraft		-			(471,017	)
Cash		-			234
Restricted cash		-			185,399
Total net assets acquired		-			417,416
Consideration per Share Exchange Agreement		-			268
Goodwill/(Bargain Purchase Gain)	$	-		$	(417,148	)

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

F-6

TRAQIQ, INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2020 AND 2019

NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS

TraQiQ, Inc. (along with its wholly owned subsidiaries, referred to herein as the “Company”) was incorporated in the State of California on September 9, 2009 as Thunderclap Entertainment, Inc. On July 14, 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc. On July 19, 2017, the Company entered into a Share Exchange Agreement (“Share Exchange”) with the stockholders of OmniM2M, Inc. (“OmniM2M”) and TraQiQ Solutions, Inc. dba Ci2i Services, Inc. (formerly Ci2i Services, Inc. – amended November 6, 2019) (“Ci2i”) whereby the stockholders of Omni and Ci2i exchanged all of their respective shares, representing 100% ownership in OmniM2M and Ci2i in exchange for 12,000,000 shares of the Company’s common stock, respectively. The OmniM2M Shareholders and the Ci2i Shareholders have each been issued their respective 12,000,000 shares on a pro rata basis based on their respective holdings in OmniM2M and Ci2i in the Share Exchange Agreement. The Share Exchange was accounted for as a reverse merger whereas Ci2i is considered the accounting acquirer and TraQiQ,Inc. is considered the accounting acquiree. For accounting purposes, the acquisition of Omni is recorded at historical cost in accordance with Accounting Standard Codification (“ASC”) 805-50-25-2 as this is considered an acquisition of entities under common control as the management of the Company and Omni control the activities of the respective companies. Prior to the merger with Ci2i and acquisition of Omni, the Company was considered a shell company under Rule 12b-2 of the Exchange Act. On December 1, 2017, The Company entered into a Share Purchase Agreement (the “Share Exchange Agreement”) with Ajay Sikka (“Sikka”), the sole shareholder of Transport IQ, Inc. whereby Sikka agreed to sell all of the shares in TransportIQ, Inc. (“TransportIQ”) in exchange for $18,109, in the form of cancellation of all of the debt of TransportIQ that is owed to the Company. The transaction became effective upon the execution of the Share Exchange Agreement by Sikka and the Company; and Transport IQ, Inc, is now a wholly-owned subsidiary of the Company. Because TransportIQ was commonly controlled and owned, the transaction was recorded at the historical carrying value of TransportIQ’s assets and liabilities.

TraQiQ Solutions, Inc.

This entity was formed about over 15 years ago and has most recently been providing technology solutions, predominantly in the business intelligence and data analytics arenas. The Company has been a vendor to Microsoft for over 10 years and has done work with many Microsoft product and business groups, including Microsoft Azure and Microsoft Media planning. Ci2i has worked closely with customers where a wide variety of analytics solutions were built.

Ci2i’s cloud solutions and analytics services comprise software development, program management, project management, and business analytics services.

F-7

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation (“Mann”). On January 2, 2020, Mann changed its name to TRAQIQ Solutions Private Limited (“TRAQ Pvt Ltd”). Pursuant to the Share Exchange Agreement with Mann, the Company acquired 100% of the shares of Mann and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing. This transaction is being recorded as a business combination under ASC 805.

The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately.

Mann-India Private limited was renamed to TraQiQ Solutions Private Limited shortly after acquisition by TraQiQ Inc.

The warrants that are exercisable in one-year (which were extended to March 31, 2021) and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately.

TRAQ Pvt Ltd. was established in May 2000 and is headquartered in New Delhi, India. TRAQ Pvt Ltd. is a leading software development company which, with the advent of technology, has evolved as a mature and fast-growing company committed to provide reliable and cost-effective software solutions across industries all over the world.

TRAQ Pvt Ltd. has its own experienced team of software developers dedicated towards developing various kinds of customized software.

TraQ Pvt Ltd. has been doing business around the world for over 15 years, with particular emphasis on Latin America and India. The customer list includes large enterprise Finance and Insurance companies across Latin America. The company’s product portfolio has evolved rapidly and now includes enterprise ready solutions for payment processing, mobile wallets, micro lending solutions and digital transformation.

TraQSuite is a distribution platform that allows users to setup task-based networks rapidly – target customers, facilitate/validate transactions, track/manage task workers, manage funds and run the entire distribution network. It includes the following functions:

Targeting

TraQSuite analyzes your customers’ omni-channel behaviors and transactions. Using artificial intelligence technology, the software analyzes online activity and delivers real-time, automated recommendations and personalized content, including such items as personalized, always-updated coupons, funds, tickets and loyalty cards.

Transactions

The digital transactions functions of the software enable users to manage and control finances and virtually store and use financial assets including G2P, B2P, welfare, salary, cards and micro banking like loans and insurance. The software includes back-end payment processing and a front-end digital wallet that allows users with and without bank accounts to buy products and services and pay with their mobile devices, settling transactions across multiple vendors, currencies and locations.

Last mile

The Last-Mile software module is designed to allow logistics and delivery operations to manage large numbers of workers in multiple locations that are delivering products and services to users. It both tracks the task workers and provides validation for the transactions. The mobile applications enable data sharing and validation and also measure customer satisfaction.

Integration

TraQSuite also includes software designed to integrate the TraQSuite tools with existing business software.

Learning

TraQLearn is eLearning software that includes modules and dashboards for students, teachers and administrators and tools to help with targeted learning.

Effective December 31, 2020, Ci2i acquired the net assets of OmniM2M and TransportIQ, and then dissolved those entities in January 2021. The value of those transactions were for the assumed liabilities of Omni and TransportIQ, and no cash was exchanged. These acquisitions did not constitute accounting for discontinued operations under ASC 205 as the two entities were acquired by a subsidiary of the Company and were not disposed of.

NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the regulations of the United States Securities and Exchange Commission.

Consolidation

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

Use of Estimates

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

F-8

Foreign Currency Transactions

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

Reclassification

Certain prior period amounts have been reclassified to conform with current period presentation with no effect on the Company’s net loss, total assets, liabilities equity or cash flows.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and on deposit at banking institutions as well as all highly liquid short-term investments with original maturities of 90 days or less of $29,658 and $9,094 as of December 31, 2020 and December 31, 2019, respectively.

Restricted Cash

The Company’s restricted cash balance consists of time deposits with financial institutions which are valued at cost and approximate fair value. Interest earned on these deposits in included in interest income. The carrying value of our restricted cash at December 31, 2020 and December 31, 2019 was $28,746 and $182,627, respectively. The balances consist of time deposits pledged with financial institutions for a Line of Credit facility taken from Andhra Bank, issuance of overdraft limit.

Accounts Receivable and Concentration of Credit Risk

The Company considers accounts receivable, net of allowance for returns and doubtful accounts, to be fully collectible. The allowance is based on management’s estimate of the overall collectability of accounts receivable, considering historical losses and economic conditions. Based on these same factors, individual accounts are charged off against the allowance when management determines those individual accounts are uncollectible. Credit extended to customers is generally uncollateralized. Past-due status is based on contractual terms. Management has determined that no allowance was required for the outstanding accounts receivable as of December 31, 2020 and December 31, 2019.

Property and Equipment and Long-Lived Assets

Fixed assets are stated at cost. Depreciation on fixed assets are computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years.

FASB Codification Topic 360 “Property, Plant and Equipment” (ASC 360), requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The application of ASC 360 has not materially affected the Company’s reported earnings, financial condition or cash flows.

Intangible assets with definite useful lives are stated at cost less accumulated amortization. Intangible assets represent purchased intangible of TRAQ Pvt Ltd. which includes customer relationships and trademarks. The Company amortizes these intangible assets on a straight-line basis over their estimated useful lives of 15 years. OmniM2M has had and currently does have computer software development underway, however, has determined that the costs associated with this development, currently do not meet the requirements for capitalization under ASC 985-20-25. OmniM2M will continue to monitor the development of such software in relationship to the requirements under the ASC in the future to determine if capitalization is warranted.

F-9

The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The adoption of this ASU did not have a material impact on our consolidated financial statements. The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets.

The Company will assess the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable at the time they do have intangible assets. Factors the Company considers to be important which could trigger an impairment review include the following:

1. Significant underperformance relative to expected historical or projected future operating results;

2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and

3. Significant negative industry or economic trends.

When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company will measure any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. Management has determined that no impairment of long-lived assets is required for the periods ended December 31, 2020 and December 31, 2019.

Capitalized Software Costs

In accordance with the relevant FASB accounting guidance regarding the development of software to be sold, leased, or marketed, the Company expenses such costs as they are incurred until technological feasibility has been established, at and after which time these costs are capitalized until the product is available for general release to customers. Once the technological feasibility is established per ASC 985-20, the Company capitalizes costs associated with the acquisition or development of major software for internal and external use in the balance sheet. Costs incurred to enhance the Company’s software products, after general market release of the services using the products, is expensed in the period they are incurred. The Company only capitalizes subsequent additions, modifications or upgrades to internally developed software to the extent that such changes allow the software to perform a task it previously did not perform. The Company expenses software maintenance and training costs as incurred. The Company has not capitalized any cost for software development for the years ended December 31, 2020 and 2019, respectively. 

Revenue Recognition

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

F-10

Professional Service Revenue

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

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

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

TRAQ Pvt Ltd. has deferred the revenue and costs attributable to certain process transition activities with respect to its customers where such activities do not represent the culmination of a separate earnings process. Such revenue and costs are subsequently recognized ratably over the period in which the related services are performed. Further, the deferred costs are limited to the amount of the deferred revenues.

TRAQ Pvt Ltd. has now started offering an integrated solution for supply chain and last mile. This product called “TraQSuite” is now offered in multiple markets as a cloud-based subscription offering. This is a significant improvement from the earlier professional services business.

Software Solution Revenue

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

F-11

The following is a summary of revenue for the years ended December 31, 2020 and 2019, disaggregated by type:

	2020		2019
Professional Services Revenue	$	935,214	$	654,374
Software Solution Revenue		74,735		26,358
	$	1,009,949	$	680,732

Costs of Services Provided

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

Lease Obligations

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

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately.

Income Taxes

Income taxes are accounted under the asset and liability method. The current charge for income tax expense is calculated in accordance with the relevant tax regulations applicable to entity. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance if, based on available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Uncertain Tax Positions

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

TraQiQ, Inc., TraQiQ Solutions, OmniM2M and TransportIQ file a consolidated income tax return in the U.S. federal tax jurisdiction and various state tax jurisdictions. TRAQ Pvt Ltd. files income tax returns in all India tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed. The India tax returns of TRAQ Pvt Ltd. are subject to examination by the India Income Tax Department and India state taxing authority, generally for 12 months after the relevant tax year, 24 months after the relevant tax year in case transfer pricing provisions are applicable.

F-12

Fair Value of Financial Instruments

ASC 825, “Financial Instruments,” requires the Company to disclose estimated fair values for its financial instruments. The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses, stockholder advances, short term financing and convertible debt approximate fair value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.

Fair Value Measurements

ASC 820 “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

These consolidated financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management for the respective periods. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, investments, short-term notes payable, accounts payable and accrued expenses.

Derivative Financial Instruments

Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of the convertible instruments are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model we use for determining the fair value of our derivatives are binomial pricing models. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss).

With the issuance of the July 2017 FASB ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features, the Company has chosen the early adopt retroactively the amendments in Part I of the standard whereby fair value derivative liabilities previously recognized were derecognized in the current and comparative periods. Under the amendments included in this update, the Company is no longer required to record changes in fair value during the period of change as a separate component of other income (expense) in the consolidated Statements of Operations.

F-13

The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (in Topic 260). The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.

Under current GAAP, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in Topic 480 is evaluated under the guidance in Topic 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting. Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date.

The amendments in this Update revise the guidance for instruments with down round features in Subtopic 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in Subtopic 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated.

For entities that present EPS in accordance with Topic 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by the Topic 260 amendments in this Update.

Those amendments in Part I of this Update are a cost savings relative to current GAAP. This is because, assuming the required criteria for equity classification in Subtopic 815-40 are met, an entity that issued such an instrument no longer measures the instrument at fair value at each reporting period (in the case of warrants) or separately accounts for a bifurcated derivative (in the case of convertible instruments) on the basis of the existence of a down round feature. For convertible instruments with embedded conversion options that have down round features, applying specialized guidance such as the model for contingent beneficial conversion features rather than bifurcating an embedded derivative also reduces cost and complexity. Under that specialized guidance, the issuer recognizes the intrinsic value of the feature only when the feature becomes beneficial instead of bifurcating the conversion option and measuring it at fair value each reporting period.

F-14

The amendments in Part II of this Update replace the indefinite deferral of certain guidance in Topic 480 with a scope exception. This has the benefit of improving the readability of the Codification and reducing the complexity associated with navigating the guidance in Topic 480.

For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways:

1.	retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective; or
2.	retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.

Earnings (Loss) Per Share of Common Stock

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

Related Party Transactions

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

Retirement Benefits to Employees

Defined Contribution Plan

In India, the employees receive benefits from a provident fund, where the employer and employees each make monthly contributions to the plan at a pre-determined rate to the Regional Provident Fund Commissioner. Employer’s contributions to the fund is charged as an expense in the Statements of Operations.

Defined Benefit Plan

In accordance with the Payment of Gratuity Act, 1972, applicable for Indian companies, TRAQ Pvt Ltd. provides for a lump sum payment to eligible employees, at retirement or termination of employment based on the last drawn salary and years of employment with the Company. Current service costs for defined benefit plans are accrued in the period to which they relate. The liability in respect of defined benefit plans is calculated annually by TRAQ Pvt Ltd. TRAQ Pvt Ltd. records annual amounts relating to its defined benefit plans based on calculations that incorporate various actuarial and other assumptions, including discount rates, mortality, assumed rates of return, compensation increases and turnover rates. TRAQ Pvt Ltd. reserves its assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when it is appropriate to do so. TRAQ Pvt Ltd.’s obligation in respect of the gratuity plan, which is a defined benefit plan, is provided for based on actuarial valuation.

F-15

Other Long-Term Employee Benefits

TRAQ Pvt Ltd.’s net obligation in respect of leave encashment is the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is based on the prevailing market yields of Indian government securities at the reporting date that have maturity dates approximating the terms of TRAQ Pvt Ltd.’s obligations. The calculation is performed using the projected unit credit method. Any actuarial gains or losses are recognized.

Investments

The Company’s investments are in debt and equity instruments. These investments are accounted for in accordance with ASC 320 Investments – Debt Securities and ASC 321 Investments – Equity Securities. Interest earned under such investments are included in interest income.

Segment Reporting

For purposes of segment disclosures, two or more operating segments should be grouped only if the segments meet all the requirements of paragraph 280-10-50-11, including the requirements for similar economic characteristics.

As a result, all operating units perform similar services, and approximately 99% of the Company’s revenue is generated from its Indian subsidiary. The Company believes that no segment reporting is required as all remaining operations outside of the Indian subsidiary is immaterial.

Recently Issued Accounting Standards

There were updates recently issued, most of which represent technical corrections to the accounting literature or application to specific industries or transactions that are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

Going Concern

The Company has an accumulated deficit of $2,504,893 and a working capital deficit of $2,851,721, as of December 31, 2020, and a working capital deficit of $2,697,036 as of December 31, 2019. As a result of these factors, management has determined that there is substantial doubt about the Company ability to continue as a going concern.

These consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.

In May 2019, the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company. This acquisition will assist the Company in operations and cash flow.

F-16

The Company plans to raise additional capital to carry out its business plan. The Company’s ability to raise additional capital through future equity and debt securities issuances is unknown. Obtaining additional financing and the successful development of the Company’s contemplated plan of operations, ultimately, to profitable operations, are necessary for the Company to continue operations.

NOTE 3: ACQUISITION OF TRAQ PVT LTD.

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation. On January 2, 2020, the name of this company was changed to TRAQIQ Solutions Private Limited. Pursuant to the Share Exchange Agreement with TRAQ Pvt Ltd., the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities) in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately upon closing; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing.

The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately.

The Company acquired the assets and liabilities noted below in exchange for the warrants noted herein and accounted for the acquisition in accordance with ASC 805. As a result, total consideration was equal to the value of the warrants of $268, as stated in the agreement, and the Company recognized a gain on bargain purchase in the amount of $417,148. In accordance with ASC 805-20-50-4A, based on the book values which approximate fair values at the effective date of acquisition, the purchase price was recorded as follows:

Cash (including restricted cash of $185,399)	$	185,633
Accounts receivables, net		506,951
Prepaid expenses and other current assets		216,956
Right-of-use asset		576,566
Fixed assets		68,260
Customer relationships		448,800
Tradenames		49,799
Investment		42,248
Other assets		37,950
Accounts payable and accrued expenses		(173,197	)
Accrued payroll and related taxes		(325,629	)
Accrued duties and taxes		(66,765	)
Lease liability		(585,207	)
Deferred revenue		(3,618	)
Cash overdraft		(471,017	)
Debt – related parties		(61,273	)
Debt		(29,041	)
	$	417,416

The customer relationships and tradenames are being amortized over fifteen years.

The difference between the net assets acquired of $417,416, and the consideration paid (in the form of warrants) of $268 represents a bargain purchase gain of $417,148.

F-17

The following table shows pro-forma results for the year December 31, 2019 as if the acquisition had occurred on January 1, 2019. These unaudited pro forma results of operations are based on the historical financial statements and related notes of TRAQ Pvt Ltd. and the Company.

	For the year ended December 31, 2019
Revenues	$	1,143,606
Net income (loss)	$	(166,533	)
Net income (loss) per share	$	(0.01	)

NOTE 4: CASH AND RESTRICTED CASH

Cash and restricted cash are as follows:

	December 31, 2020		December 31, 2019
Cash on hand	$	141	$	252
Bank balances		29,517		8,842
Restricted cash		28,746		182,627
Total	$	58,404	$	191,721

ASU 2016-18, “Statements of Cash Flows” (Topic 230) was adopted by the Company in 2017. In accordance with this standard, restricted cash and restricted cash equivalents is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the Statements of Cash Flows. During the years ended December 31, 2020 and December 31, 2019, there were no cash equivalents.

NOTE 5: FIXED ASSETS

The Company’s property and equipment is as follows:

	December 31, 2020			December 31, 2019			Estimated Life
Property and equipment – TRAQ Pvt Ltd.	$	638,587		$	650,621		3 - 10 years
Less: accumulated depreciation		(602,214	)		(601,940	)
Net	$	36,373		$	48,681

Depreciation expense for the years ended December 31, 2020 and 2019 was $14,747 and $22,065, respectively.

NOTE 6: INTANGIBLE ASSETS

The Company’s intangible assets are as follows:

	December 31, 2020			December 31, 2019
Customer relationships	$	448,800		$	448,800
Tradenames		49,799			49,799
Less: accumulated amortization		(54,015	)		(20,775	)
Net	$	444,584		$	477,824

Amortization expense for the years ended December 31, 2020 and 2019 was $33,240 and $20,775, respectively.

F-18

NOTE 7: LONG-TERM INVESTMENT

The Company’s long-term investment is as follows:

	December 31, 2020		December 31, 2019
Equity Security – Compulsorily Convertible Debenture	$	40,603	$	41,617

The investment the Company has in a 1% Compulsorily Convertible Debenture for the period of seven years are neither to be redeemed by the issuing entity nor are redeemable at the option of the investor, therefore this has been considered an equity security. The Company has elected to measure the equity security at its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer.

NOTE 8: NOTE RECEIVABLE

The Company’s notes receivable is as follows:

	December 31, 2020		December 31, 2019
MIMO Technologies PVT Ltd	$	227,877	$	-

The Company entered into a note receivable with a related party in the amount of 15,037,263 INR (approximately $170,000 US$) dated April 1, 2020 with no stated maturity date. The note bears interest at 13% per annum. Further, the Company provided additional amounts on October 5, 2020, to bring the total outstanding to 16,647,264 INR ($227,877 US$) as of December 31, 2020.

NOTE 9: LONG-TERM DEBT RELATED PARTIES

The following is a summary of the current portion - long-term debt - related parties as of December 31, 2020 and December 31, 2019:

		December 31, 2020			December 31, 2019
Unsecured advances - CEO	(a)	$	1,718,277		$	1,221,737
Notes payable - Satinder Thiara	(b)		57,000			57,000
Promissory note – Kunaal Sikka	(c)		15,000			15,000
Notes payable – Swarn Singh	(d)		45,000			45,000
Note payable - Chaudhary	(e)		8,122			-
			1,843,399			1,338,737
Current portion of long-term debt related parties			(1,843,399	)		(1,306,737	)
Long-term debt – related parties		$	-		$	32,000

(a)

This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at 15% annually (1.25% monthly) and are due on demand.

(b)

Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due December 31, 2021, December 13, 2016 ($10,000) which is due December 31, 2021, and May 1, 2018 ($25,000) which matured December 31, 2019 at interest rate of 15% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).

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(c)	Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on December 31, 2019, and accruing interest at an annual rate of 12%. The note is in default as of December 31, 2019. As a result the interest rate was changed to 18% annually (1.50% monthly).
(d)	Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of 15% annually (1.25% monthly). These are unsecured notes. Both notes were due December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).
(e)	Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of 1,100,000 INR (approximately $14,500 US$) due on demand at 13% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,179.

Interest expense on these notes for the years ended December 31, 2020 and 2019 are $228,748 and $170,688, respectively.

NOTE 10: LONG-TERM DEBT

The following is a summary of the long-term debt as of December 31, 2020 and December 31, 2019:

		December 31, 2020			December 31, 2019
Promissory notes - Kabbage	(a)	$	-		$	23,826
Promissory notes – Loan Builder	(b)		-			-
Other debt – in default	(c)		6,000			6,000
Yukti Securities Private Limited	(d)		4,547			4,660
Lathika Regunathan	(e)		-			-
Noor Qazi	(f)		-			50,562
Auto loan – ICICI Bank	(g)		18,539			25,662
Baxter Credit Union	(h)		99,911			100,000
UGECL	(i)		54,563			-
USA Bank PPP	(j)		10,057			-
Total		$	193,617		$	210,710
Current portion			(133,761	)		(191,508	)
Long-term debt, net of current portion		$	59,856		$	19,202

(a)	Multiple monthly loan agreements with Kabbage. Each of these loans has a six-month duration with interest and fees spread over the 6 months.
(b)	Business loan agreement with LoanBuilder in August 2018 in the amount of $18,000, payable in 52 weekly payments of $409, including interest.
(c)	Note payable to an individual for $7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made a payment of $1,500 against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider.
(d)	Loan payable to Yukti Securities Private Limited is an unsecured loan which is due on demand.
(e)	Unsecured loan from Lathika Regunathan, individual, is due on demand. Was repaid in 2019.
(f)	Unsecured loan from Noor Qazi, individual, is due on demand. Was repaid in December 2020.
(g)	Loan payable with ICICI Bank, secured by the vehicle the loan was taken for. Payments are monthly at $752, through maturity in May 2023. Of the amount outstanding, the following represents the maturity: Current (2021) $7,183; (2022) $7,837; (2023) $3,519.
(h)	Revolving loan in the amount of $100,000 at 4% interest per annum due December 30, 2020. The loan was renegotiated for a balance of $99,911 with similar terms at 4% interest per annum and is guaranteed by the CEO of the Company.
(i)	COVID line of credit from UGECL up to 4,000,000 INR in India, term of 48 months, interest only at 7.5% annual rate for first 12 months, then 36 equal installments through maturity. Current (2021) $6,063; long-term (2022-2024) $48,500.
(j)	PPP loan from USA Bank, with interest accruing at 1% per annum. Original amount of $34,697 had $24,640 forgiven in December 2020, with the remaining $10,057 due in five years In February 2021, the Company was notified that the entire balance of the PPP loan has been forgiven.

Interest expense on these notes for the years ended December 31, 2020 and 2019 are $6,932 and $12,110, respectively.

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NOTE 11: CURRENT PORTION - CONVERTIBLE DEBT – RELATED AND UNRELATED PARTIES

The following is a summary of current portion - convertible debt - related and unrelated parties as of December 31, 2020 and December 31, 2019:

		December 31, 2020		December 31, 2019
Face value of notes – related party	(a)	$	95,000	$	95,000
Face value of notes – unrelated parties	(a)		98,077		98,077
Excess of the fair value of shares issuable over the face value of the convertible notes	(a)		48,257		48,257
		$	241,334	$	241,334

(a)

In connection with the reverse merger in July 2017, the Company and two stockholders, who had provided related party advances to the Company, agreed to exchange their related party advances for 6% Convertible Promissory Notes that were originally due on January 15, 2018 (the “Notes”) in the amount of $68,077. From August 2017 through November 2017, the Company issued additional notes to four different parties (two of which were related parties) in the principal amount of $100,000 ($70,000 to related parties). In January 2018, the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019. The Notes bear simple interest at 6% unless the Company defaults, which increases the interest rate to 10%. The Holders, at their option, can elect to convert the principal plus any accrued interest, into shares of the Company’s common stock at a conversion rate equal to eighty percent (80%) of the average closing share price as quoted on the OTC Markets for the five (5) trading days prior to the date of conversion. There are two notes that had a maturity date of June 30, 2019, with the remaining notes having a maturity date of December 31, 2019. These notes have not been extended and are currently in default. The Company has classified these notes as current liabilities. The Company has accrued the default interest on the two notes from July 1, 2019 through December 31, 2020.

During the year ended December 31, 2018, the Company received additional proceeds from a related party of $25,000 (from Dharam V. Sikka, father of CEO) pursuant to a convertible note payable issued in May 2018, with the same interest rate and conversion terms as the Notes described above, initially maturing on December 31, 2018, which has been extended to March 31, 2019 and then again to December 31, 2019. Because the Notes are convertible into a variable number of shares of common stock based on a fixed dollar amount, in accordance with ASC Topic 480-10-50-2, the notes are recorded at the fair value of the shares issuable upon conversion. The excess of the fair value of shares issuable over the face value of the Notes is recorded as a discount to the note to be amortized into interest expense over the term of the note.

Interest expense on these notes for the years ended December 31, 2020 and 2019 are $19,361 and $12,957, respectively.

The Company has calculated the stock-settled liability in accordance with ASC 835-30 which establishes the monetary value at settlement of these instruments at fair value.

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NOTE 12: STOCKHOLDERS’ DEFICIT

Series A Convertible Preferred Stock

On July 19, 2017, the Company approved the issuance of 50,000 shares of its Series A Convertible Preferred Stock to its CEO and, on August 1, 2017, the Company sold and issued the 50,000 shares of its Series A Convertible Preferred Stock to its CEO at a price of $0.20 per share for $10,000.

Each outstanding share of Series A Convertible Preferred Stock is convertible into the number of shares of the Company’s common stock (the “Common Stock”) determined by dividing the Stated Value by the Conversion Price as defined below, at the option of any Series A Convertible Preferred Stock shareholder in whole or in part, at any time commencing no earlier than six (6) months after the issuance date; provided that any conversion under this section must be made during the ten (10) day period immediately following the date on which the corporation files with the Securities and Exchange Commission any periodic report on form 10-Q, 10-K or the equivalent form; provided further that, any conversion under this Section IV: (a) shall be for a minimum Stated Value of $500 of Series A Convertible Preferred Stock.

The Conversion Price for each share of Series A Convertible Preferred Stock in effect on any Conversion Date shall be (i) eighty five percent (85%) of the average closing bid price of the Common Stock over the twenty (20) trading days immediately preceding the date of conversion, (ii) but no less than par value of the Common Stock. For purposes of determining the closing bid price on any day, reference shall be to the closing bid price for a share of Common Stock on such date on the OTC Markets, as reported on Bloomberg, L.P. (or similar organization or agency succeeding to its functions of reporting prices) (the “Per Share Market Value”).

Common Stock

As of December 31, 2020, the Company has 27,297,960 shares issued and outstanding.

On April 12, 2018, the Company amended its Articles of Incorporation to forward split all outstanding shares of common stock such that all issued and outstanding shares of Common Stock shall be automatically combined and reclassified such that each share of Pre-Forward Split Stock shall be combined and reclassified into four shares of Common Stock. The number of shares for all periods presented has been retroactively restated to reflect the forward split.

Warrants

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation. Pursuant to the Share Exchange Agreement, the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately upon closing; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing. The value of the transaction totaled $268 and is reflected as an increase to additional paid in capital.

Options

On November 23, 2020, the Board of Directors of the Company approved the 2020 Equity Incentive Plan.

On October 19, 2020, the Company granted 3,930,000 stock options to board members, advisory board members, employees and consultants. The options have a 10-year term, and are both service based grants, as well as performance-based grants. Stock-based compensation for the year ended December 31, 2020 was $104,638, and the unrecognized stock-based compensation for these grants as of December 31, 2020 is $660,372. Of the 3,930,000 options granted, only 312,500 have been vested through December 31, 2020.

The following represents a summary of options as of December 31, 2020 and 2019:

	December 31, 2020				December 31, 2019
	Number		Weighted Average Exercise Price		Number		Weighted Average Exercise Price
Beginning balance		-	$	-		-	$	-
Granted		3,930,000		0.0052		-		-
Exercised		-		-		-		-
Forfeited		-		-		-		-
Expired		-		-		-		-
Ending balance		3,930,000	$	0.0052		-	$	-
Intrinsic value of options	$	6,267,475			$	-
Weighted Average Remaining Contractual Life (Years)		9.81

NOTE 13: OPERATING LEASE

The Company has adopted ASU No. 2016-02, Leases (Topic 842), as of January 1, 2019 and will account for their lease in terms of the right of use assets and offsetting lease liability obligations for this new lease under this pronouncement. In accordance with ASC 842 - Leases, effective January 1, 2019, the Company up until May 16, 2019 did not have any long-term lease commitments. On May 17, 2019 with the Company’s acquisition of TRAQ Pvt Ltd., recorded a lease right of use asset and a lease liability at present value of $576,566 and $585,207, respectively. The Company is recording this amount at present value, in accordance with the standard, using an incremental borrowing rate by adjusting the benchmark reference rates with appropriate financing spreads and lease specific adjustments for the effects of collateral. The right of use asset will be composed of the sum of all lease payments plus any initial direct cost and will be straight line amortized over the life of the expected lease term. For the expected term of the lease the Company will use the term of the nine-year lease. This lease will be treated as an operating lease under the new standard.

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The Company has chosen to implement this standard using the modified retrospective model approach with a cumulative-effect adjustment, which does not require the Company to adjust the comparative periods presented when transitioning to the new guidance on January 1, 2019. The Company has also elected to utilize the transition related practical expedients permitted by the new standard. The modified retrospective approach provides a method for recording existing leases at adoption and in comparative periods that approximates the results of a modified retrospective approach.

The lease right of use asset of in the original amount of $592,909 was to be amortized on a straight-line basis over the term of the lease. For the years ended December 31, 2020 and 2019 the Company recorded rent expense of $100,079 and $74,214.

During the year ended December 31, 2020, the Company renegotiated their leases with the landlord for TRAQ Pvt Ltd. As a result of this renegotiation, the Company vacated one of their two leases, and as a result, impaired $333,571 in right-of-use asset and $349,428 in lease liability. The difference has been reflected as forgiveness of debt in the Consolidated Statements of Operations in December 31, 2020.

As of December 31, 2020, the value of the unamortized lease right of use asset is $126,118. As of December 31, 2020, the Company’s lease liability was $133,998.

Remaining Lease Obligation by calendar year (undiscounted cash flows)
2021	$	26,087
2022		29,091
2023		29,091
2024		30,000
2025		33,455
2026 and thereafter		59,940
Total lease payments		207,663
Less: Imputed interest		73,665
Present value of lease liabilities	$	133,998

nOTE 14: CONCENTRATIONS

During the years ended December 31, 2020 and 2019, the Company had two major customers comprising 85% of revenues and two major customers comprising 82% of revenues, respectively. A major customer is defined as a customer that represents 10% or greater of total revenues. There was 85% and 67% of accounts receivable two and two customers as of December 31, 2020 and December 31, 2019, respectively.

The Company does not believe that the risk associated with these customers or vendors will have an adverse effect on the business.

nOTE 15: CONTINGENCY

During the year ended December 31, 2018, the Company charged an independent truck driver approximately $190,000 pursuant to its agreement with the driver, which entitled the Company to fees equal to $800 per day for the driver’s failure to return a trailer owned by the Company with the period prescribed by the agreement. The Company has not recognized this as income due to uncertainty of payment and will record as other income during the period in which amounts are collected.

NOTE 16: PROVISION FOR INCOME TAXES

The provision (benefit) for income taxes for the years ended December 31, 2020 and 2019 differs from the amount which would be expected as a result of applying the statutory tax rates to the losses before income taxes due primarily to the valuation allowance to fully reserve net deferred tax assets.

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All United States based entities:

The following table summarizes the significant differences between the U.S. Federal statutory tax rate and the Company’s effective tax rate for financial statement purposes for the years ended December 31, 2020 and 2019:

	2020			2019
Federal income taxes at statutory rate		21.00	%		21.00	%
State income taxes at statutory rate		7.50	%		7.50	%
Temporary differences		0.38	%		(0.82	)%
Permanent differences		(0.98	)%		(7.41	)%
Change in valuation allowance		(27.90	)%		(20.27	)%
Totals		0.00	%		0.00	%

Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carry-forwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance.

	As of			As of
	December 31, 2020			December 31, 2019
Deferred tax assets:
Net operating losses before non-deductible items	$	747,748		$	579,118
Stock-based compensation		28,174			-
Depreciation		(1,616	)		(1,616	)
Total deferred tax assets		774,306			577,502
Less: Valuation allowance		(774,306	)		(577,502	)
Net deferred tax assets	$	-		$	-

As of December 31, 2020, the Company has a net operating loss carry forward of $2,777,151 expiring through 2037. The Company has provided a valuation allowance against the full amount of the deferred tax asset due to management’s uncertainty about its realization. Furthermore, the net operating loss carry forward may be subject to further limitation pursuant to Section 382 of the Internal Revenue Code. The valuation allowance was increased by $196,804 in 2020.

The Company classifies income tax penalties and interest, if any, as part of other general and administrative expenses in the accompanying consolidated statements of operations. The Company did not expense any penalties or interest during the years ended December 31, 2020 or December 31, 2019 and did not accrue any penalties or interest as of December 31, 2020 or December 31, 2019.

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India based entity:

Significant components of deferred tax liabilities as at December 31, 2020 and 2019 (was acquired May 2019):

	As of			As of
	December 31, 2020			December 31, 2019
Deferred Tax Assets:
Difference between book and tax base of fixed assets	$	43,868		$	56,696
Provision for gratuity		27,189			22,253
Provision for leave encashment		11,030			8,598
Operating lease		5,170			2,339
NOL carryforward (based on last tax return filed per Indian Income Tax laws)		43,140			11,404
Timing difference on TDS under 40a(ia)		9,002			-
MAT credit		8,644			8,860
Deferred Tax Assets		148,043			110,150
Net Deferred Tax Assets		148,043			110,150
Less: Valuation allowance		(148,043	)		(110,150	)
Net Deferred Tax Asset	$	-		$	-

Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the financial statement carrying values of assets and liabilities and their respective tax bases.

At December 31, 2020, the Company performed an analysis of the deferred tax asset valuation allowance due to management’s uncertainty about its realization. The Company when necessary will record a valuation allowance against this deferred tax asset. Based on the analysis, the Company has provided a valuation allowance against the full amount of said Deferred Tax Assets of $148,043 due to management’s uncertainty about its realization.

nOTE 17: EMPLOYEE BENEFIT PLANS

TRAQ Pvt Ltd.’s Gratuity Plan provides for lump sum payment to vested employees on retirement or upon termination of employment in an amount based on the respective employee’s salary and years of employment with the Company. Liabilities with regard to the Gratuity Plans are determined by actuarial valuation using the projected unit credit method. Current service costs for the Gratuity Plan are accrued in the year to which they relate. Actuarial gains or losses or prior service costs, if any, resulting from amendments to the plans are recognized and amortized over the remaining period of service of the employees.

F-25

The benefit obligation has been measured as of December 31, 2020. The gratuity plan is unfunded. The following table sets forth the activity of the Gratuity Plans and the amounts recognized in the Company’s financial statements for the year ended December 31, 2020:

	Year Ended
	December 31, 2020
Change in projected benefit obligation:
Projected benefit obligation as of January 1, 2020	$	85,594
Service cost		10,746
Interest cost		5,595
Benefits paid		(19,033	)
Actuarial gain (loss) on the Obligation		23,761
Effect of exchange rate changes		(2,090	)
	$	104,573
Projected benefit obligation as of December 31, 2020
Unfunded amount – non-current	$	94,023
Unfunded amount - current		10,550
Total accrued liability	$	104,573
Components of net period benefit costs:
Service cost	$	10,746
Interest cost		5,595
Actuarial gain (loss) on the Obligation		23,761
	$	40,102
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		5.55% per annum
Rate of increase in compensation levels		10.00 % per annum

The benefit obligation has been measured as of December 31, 2019. The gratuity plan is unfunded. The following table sets forth the activity of the Gratuity Plans and the amounts recognized in the Company’s financial statements for the period May 16, 2019 through December 31, 2019:

	Period May 16, 2019 through
	December 31, 2019
Change in projected benefit obligation:
Projected benefit obligation as of May 16, 2019	$	65,550
Service cost		6,982
Interest cost		3,106
Benefits paid		(1,932	)
Actuarial gain (loss) on the Obligation		13,086
Effect of exchange rate changes		(1,198	)
	$	85,594
Projected benefit obligation as of December 31, 2019
Unfunded amount – non-current	$	74,781
Unfunded amount - current		10,813
Total accrued liability	$	85,594
Components of net period benefit costs:
Service cost	$	6,982
Interest cost		3,106
Actuarial gain (loss) on the Obligation		11,888
	$	21,976
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		6.70% per annum
Rate of increase in compensation levels		10.00 % per annum

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Leave Encashment:

The other long-term employee benefits has been measured as of December 31, 2020. The following table sets forth the activity of the leave encashment and the amounts recognized in TRAQ Pvt Ltd.’s financial statements at December 31, 2020:

	Year Ended
	December 31, 2020
Change in projected benefit obligation:
Projected benefit obligation as of January 1, 2020	$	33,070
Service cost		10,746
Interest cost		5,595
Benefits paid		(2,212	)
Actuarial gain (loss) on the Obligation		(3,969	)
Effect of exchange rate changes		(806	)
	$	42,424
Projected benefit obligation as of December 31, 2020
Unfunded amount – non-current	$	37,306
Unfunded amount - current		5,118
Total accrued liability	$	42,424
Components of net period benefit costs:
Service cost	$	10,746
Interest cost		5,595
Actuarial gain (loss) on the Obligation		(3,969	)
	$	12,372
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		5.55% per annum
Rate of increase in compensation levels		10.00 % per annum

The other long-term employee benefits has been measured as of December 31, 2019. The following table sets forth the activity of the leave encashment and the amounts recognized in TRAQ Pvt Ltd.’s financial statements at the end of the period May 16, 2019 through December 31, 2019:

	Period May 16, 2019 through
	December 31, 2019
Change in projected benefit obligation:
Projected benefit obligation as of May 16, 2019	$	24,243
Service cost		3,646
Interest cost		940
Benefits paid		(919	)
Actuarial gain (loss) on the Obligation		5,617
Effect of exchange rate changes		(457	)
	$	33,070
Projected benefit obligation as of December 31, 2019
Unfunded amount – non-current	$	27,682
Unfunded amount - current		5,388
Total accrued liability	$	33,070
Components of net period benefit costs:
Service cost	$	3,646
Interest cost		940
Actuarial gain (loss) on the Obligation		5,160
	$	9,746
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		6.70% per annum
Rate of increase in compensation levels		10.00 % per annum

nOTE 18: COMMITMENTS AND CONTINGENCIES

Commitments and contingencies in respect of TRAQ Pvt Ltd;

(i)

TRAQ Pvt Ltd had applied for compounding of the TDS liability for the assessment year 2014-2015 and 2015-2016 in accordance with Indian Income Tax Laws. However, no amount payable for tax and penalty was confirmed by the Income Tax Department. Further, TRAQ Pvt Ltd has also defaulted for TDS deducted but not paid in time during assessment years 2016-2017 to 2020-2021. Accordingly, there may be a contingent liability in respect of TDS regarding compounding charges, interest, and penalty which is not quantifiable at present, hence not provided in the Consolidated Financial Statements.

(ii)

TRAQ Pvt Ltd has outstanding Gratuity for $23,971 as of December 31, 2020, towards ex-employees of TRAQ Pvt Ltd; therefore, TRAQ Pvt Ltd is liable for penalty under The Gratuity Act under the Indian Laws and other relevant laws. Since the amount of penalty for default in payment of gratuity is not ascertainable, therefore it is not provided for in the Consolidated Financial Statements. Gratuity of $13,816 has been paid in the month of January 2021.

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(iii)	There are numerous interpretative issues relating to the Indian Supreme Court (SC) judgment dated February 28, 2019, on Provident Fund (PF) on the inclusion of allowances for the purpose of PF contribution as well as its applicability. Due to a pending decision on the subject review petition and directions from EPFO, the impact for the past period, if any, was not ascertainable and consequently no effect was given in the Consolidated Financial Statements.
(iv)	TRAQ Pvt Ltd has delayed in complying with provisions related to Foreign Direct Investment and Transfer of Shares to Non-resident as per the Master Circulars and notification issued by Reserve Bank of India, therefore, is liable for imposition of penalty. Since the amount of the penalty for the same is not ascertainable, no effect was given in the Consolidated Financial Statements.
(v)	Prior to its acquisition in May 2019, TRAQ Pvt Ltd, had provided a guarantee in favor of State Bank of India for $165,813 on March 22, 2014, for Mira Green Tech Private Limited. The State Bank of India is in process of satisfying whether there is any obligation due by TRAQ Pvt Ltd at this time.

nOTE 19: SUBSEQUENT EVENTS

In January 2021, the Company issued 37,500 shares of common stock valued at $52,500 for services rendered, and in March 2021 the Company issued 61,500 shares of common stock valued at $70,725 for services rendered.

On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the amount of $125,000. The GS Note has a maturity of one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000. The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon achievement of the terms of the GS Note.

On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuna members agreed to exchange all of their respective membership interests in Rohuma in exchange for 4,292,220 shares of common stock, of which the first tranche of shares were issued on March 1, 2021 totaling 2,562,277 shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $4,335,142 ($1.01 per share).

On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”). The Platinum Note has a maturity of one-year. The conversion price of the Platinum Note is the greater of (a) $0.01 or (b) 70% of the lowest closing stock price over the previous 15 trading days. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 200,000 warrants that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections, that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 60,000 shares as a commitment fee.

On February 16, 2021, the Company entered into several stock purchase agreements for the issuance of 570,000 shares for cash in the amount of $456,000 (value of $0.80 per share). The individuals also received 285,000 warrants that have a term of three years at an exercise price of $2.00 per share.

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 1,367,539 shares of the Company’s common stock. The warrants have a term of three years and an exercise price of $0.001 and cash in the amount of $22,338.

On March 6, the Company converted $181,250 and accrued interest of $43,438 into 264,338 shares of common stock. The conversions were done at fair value. These shares will be issued by the Company in the next few weeks.

On March 8, 2021, the Company entered into a consulting agreement to provide advisory services regarding strategic planning. The agreement is for a term of one-year. The agreement calls for payments to be paid monthly in the amount of $3,000 and the issuance of stock at the commencement of the agreement for 25,000 shares, and a three-year warrant for 100,000 warrants with a strike price of $2.00 per share that vest March 7, 2022.

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TRAQIQ, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

JUNE 30, 2021 (UNAUDITED) AND DECEMBER 31, 2020

IN US$

		JUNE 30,			DECEMBER 31,
		2021			2020
		(UNAUDITED)
ASSETS
Current Assets:
Cash	$	137,530		$	29,658
Accounts receivable, net		677,302			521,618
Note receivable - related party		-			227,877
Prepaid expenses and other current assets		481,606			322,286
Total Current Assets		1,296,438			1,101,439
Fixed assets, net		36,819			36,373
Intangible assets, net		563,632			444,584
Goodwill		6,507,680			-
Restricted cash		165,488			28,746
Long-term investment		1,440			40,603
Right-of-use asset		118,237			126,118
Other assets		3,409			3,196
Total Non-current Assets		7,396,705			679,620
TOTAL ASSETS	$	8,693,143		$	1,781,059
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
LIABILITIES
Current Liabilities:
Accounts payable and accrued expenses	$	1,616,953		$	1,163,505
Cash overdraft		233,729			188,721
Accrued payroll and related taxes		447,569			327,084
Accrued taxes and duties payable		157,152			46,577
Deferred revenue		39,215			-
Derivative liability		1,510,000			-
Contingent consideration - Rohuma		1,383,954			-
Contingent consideration - Mimo		656,179			-
Current portion - lease liability		11,168			8,779
Current portion - long-term debt - related parties		2,629,839			1,843,399
Current portion - long-term debt		317,876			133,761
Current portion - convertible notes payable, net of discounts		328,098			-
Current portion - convertible debt - long-term debt - related and unrelated parties		85,084			241,334
Total Current Liabilities		9,416,816			3,953,160
Long-term debt, net of current portion		55,292			59,856
Long-term debt - related parties, net of current portion		15,000			-
Lease liability, net of current portion		116,751			125,219
Total Non-current Liabilities		187,043			185,075
Total Liabilities		9,603,859			4,138,235
Commitments and contingencies		-			-
STOCKHOLDERS’ EQUITY (DEFICIT)
Preferred stock, par value, $0.0001, 10,000,000 shares authorized, Series A Convertible Preferred, 50,000 and 50,000 shares issued and outstanding, respectively		5			5
Common stock, par value, $0.0001, 300,000,000 shares authorized, 31,430,575 and 27,297,960 issued and outstanding, respectively		3,143			2,730
Additional paid in capital		5,090,929			117,261
Accumulated deficit		(6,008,129	)		(2,504,893	)
Accumulated other comprehensive income (loss)		773			27,721
Total Stockholders’ Equity (Deficit) before Non-controlling Interest		(913,279	)		(2,357,176	)
Non-controlling interest		2,563			-
Total Stockholders’ Equity (Deficit)		(910,716	)		(2,357,176	)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	$	8,693,143		$	1,781,059

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

F-29

TRAQIQ, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)

FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2021 AND 2020

IN US$

	SIX MONTHS ENDED						THREE MONTHS ENDED
	JUNE 30,						JUNE 30,
	2021			2020			2021			2020
REVENUE	$	1,319,388		$	521,319		$	937,002		$	230,258
COST OF REVENUE		1,012,028			268,683			788,196			129,545
GROSS PROFIT		307,360			252,636			148,806			100,713
OPERATING EXPENSES
Salaries and salary related costs		309,013			94,639			160,582			48,214
Professional fees		287,288			115,135			135,863			55,253
Rent expense		15,511			63,895			7,725			30,886
Depreciation and amortization expense		37,019			24,806			20,301			12,076
General and administrative expenses		1,527,969			61,419			692,245			26,661
Total Operating Expenses		2,176,800			359,894			1,016,716			173,090
OPERATING LOSS		(1,869,440	)		(107,258	)		(867,910	)		(72,377	)
OTHER INCOME (EXPENSE)
Change in fair value of derivative liability		(1,196,132	)		-			(691,125	)		-
PPP forgiveness and other income		10,073			10,000			-			10,000
Interest expense, net of interest income		(363,178	)		(165,170	)		(217,545	)		(81,986	)
Total other income (expense)		(1,549,237	)		(155,170	)		(908,670	)		(71,986	)
NET LOSS BEFORE PROVISION FOR INCOME TAXES		(3,418,677	)		(262,428	)		(1,776,580	)		(144,363	)
Provision for income taxes		81,996			806			33,722			(3	)
NET LOSS		(3,500,673	)		(263,234	)		(1,810,302	)		(144,360	)
NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST		(2,563	)		-			(1,110	)		-
NET LOSS ATTRIBUTABLE TO CONTROLLING INTEREST	$	(3,503,236	)	$	(263,234	)	$	(1,811,412	)	$	(144,360	)
Other comprehensive loss
Foreign currency translations adjustment		(26,948	)		(37,607	)		(20,809	)		(11,447	)
Comprehensive loss	$	(3,530,184	)	$	(300,841	)	$	(1,832,221	)	$	(155,807	)
Net loss per share	$	(0.11	)	$	(0.01	)	$	(0.06	)	$	(0.01	)
Weighted average common shares outstanding - basic and diluted		30,478,877			27,297,960			31,168,641			27,297,960

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

F-30

TRAQIQ, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) (UNAUDITED)

FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2021 AND 2020

IN US $

	Series A Preferred				Common Stock				Additional Paid-In Capital -		Accumulated			Accumulated Other Comprehensive			Non-controlling
	Shares		Amount		Shares		Amount		Common		Deficit			Income (Loss)			Interest		Total
Balance - January 1, 2020		50,000	$	5		27,297,960	$	2,730	$	12,623	$	(1,896,984	)	$	21,244		$	-	$	(1,860,382	)
Net loss for the period		-		-		-		-		-		(118,874	)		(26,160	)		-		(145,034	)
Balance - March 31, 2020		50,000		5		27,297,960		2,730		12,623		(2,015,858	)		(4,916	)		-		(2,005,416	)
Net loss for the period		-		-		-		-		-		(144,360	)		(11,447	)		-		(155,807	)
Balance - June 30, 2020		50,000	$	5		27,297,960	$	2,730	$	12,623	$	(2,160,218	)	$	(16,363	)	$	-	$	(2,161,223	)
Balance - January 1, 2021		50,000	$	5		27,297,960	$	2,730	$	117,261	$	(2,504,893	)	$	27,721		$	-	$	(2,357,176	)
Shares of stock issued for cash		-		-		570,000		57		455,943		-			-			-		456,000
Shares of stock issued for conversion of notes payable and accrued interest		-		-		264,338		26		224,661		-			-			-		224,687
Shares of stock issued for services rendered		-		-		400,000		40		436,345		-			-			-		436,385
Shares of stock issued for acquisition of Rohuma (first tranche)		-		-		2,562,277		256		2,049,565		-			-			-		2,049,821
Stock-based compensation on granting of options		-		-		-		-		108,341		-			-			-		108,341
Stock-based compensation - warrants granted for consulting		-		-		-		-		68,642		-			-			-		68,642
Warrants earned for acquisition of Mimo		-		-		-		-		984,268		-			-			-		984,268
Net loss for the period		-		-		-		-		-		(1,691,824	)		(6,139	)		1,453		(1,696,510	)
Balance - March 31, 2021		50,000		5		31,094,575		3,109		4,445,026		(4,196,717	)		21,582			1,453		274,458
Shares of stock issued for cash		-		-		35,000		4		38,496		-			-			-		38,500
Shares of stock issued for services rendered		-		-		1,000		-		1,750		-			-			-		1,750
Shares of stock issued for providing note payable		-		-		300,000		30		446,970		-			-			-		447,000
Stock-based compensation on granting of options		-		-		-		-		118,465		-			-			-		118,465
Stock-based compensation for restricted stock grants (shares not issued)		-		-		-		-		40,222		-			-			-		40,222
Net loss for the period		-		-		-		-		-		(1,811,412	)		(20,809	)		1,110		(1,831,111	)
Balance - June 30, 2021		50,000	$	5		31,430,575	$	3,143	$	5,090,929	$	(6,008,129	)	$	773		$	2,563	$	(910,716	)

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

F-31

TRAQIQ, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND 2020

IN US$

		2021			2020
CASH FLOW FROM OPERTING ACTIVIITES
Net loss	$	(3,503,236	)	$	(263,234	)
Adjustments to reconcile net loss to net cash (used in) operating activities
Change in non-controlling interest		2,563			-
Bad debt expense		223,673			-
Forgiveness of debt		(10,087	)		-
Depreciation and amortization		37,019			24,806
Lease cost, net of repayment		1,936			5,724
Foreign currency (gain) loss		2,164			(10,401	)
Stock-based compensation		295,448			-
Common stock issued for services rendered		925,356			-
Change in fair value of derivative liability		1,196,132			-
Amortization of discounts on debt		146,966			-
Changes in assets and liabilities
Accounts receivable		(415,092	)		56,303
Prepaid expenses and other current assets		90,730			(84,563	)
Other assets		-			-
Accounts payable and accrued expenses		(325,373	)		215,446
Accrued payroll and payroll taxes		14,738			20,526
Accrued duties and taxes		76,995			20,105
Deferred revenue		30,974			-
Total adjustments		2,294,142			247,946
Net cash (used in) operating activities		(1,209,094	)		(15,288	)
CASH FLOWS FROM INVESTING ACTIVITES
Cash received in acquisition of Mimo		42,905			-
Cash received in acquisition of Rohuma		5,951			-
Acquisition of Mimo		(21,856	)		-
Advances of note receivable - related party		-			(173,802	)
Acquisition of fixed assets		(2,010	)		(2,011	)
Net cash provided by (used in) investing activities		24,990			(175,813	)
CASH FLOWS FROM FINANCING ACTIVITES
Increase in cash overdraft		45,258			37,277
Proceeds from the issuance of common stock		494,500			-
Proceeds from convertible notes		515,000			-
Repayment of convertible notes		(20,000	)		-
Proceeds from long-term debt - related parties		1,122,096			144,759
Repayment of long-term debt - related parties		(681,968	)		(25,000	)
Proceeds from long-term debt		50,331			42,797
Repayments of long-term debt		(96,499	)		(25,284	)
Net cash provided by financing activities		1,428,718			174,549
NET INCREASE (DECREASE) IN CASH AND RESTRICTED CASH		244,614			(16,552	)
CASH AND RESTRICTED CASH - BEGINNING OF PERIOD		58,404			191,721
CASH AND RESTRICTED CASH - END OF PERIOD	$	303,018		$	175,169
CASH PAID DURING THE PERIOD FOR:
Interest expense	$	21,908		$	55,484
Income taxes	$	81,996		$	946
SUMMARY OF NON-CASH ACTIVITIES:
Acquisition of Rohuma:
Accounts receivable	$	4,179		$	-
Prepaid and other current assets		8,943			-
Fixed assets		4,512			-
Investment		1,440			-
Accounts payable and accrued expenses		(58,153	)		-
Accrued duties and taxes		(2,688	)		-
Long-term debt - related parties		(37,776	)		-
Long-term debt		(10,000	)		-
Cash overdraft		(2,980	)		-
Cash		6,027			-
Total net assets acquired		(86,496	)		-
Consideration per Share Exchange Agreement		3,433,776			-
Goodwill/(Bargain Purchase Gain)	$	3,520,272		$	-
Acquisition of Mimo Technologies:
Accounts receivable	$	58,692		$	-
Prepaid and other current assets		272,872			-
Fixed and intangible assets		153,186			-
Accounts payable and accrued expenses		(708,833	)		-
Accrued payroll and related taxes		(104,750	)		-
Accrued duties and taxes		(28,213	)		-
Long-term debt - related parties		(343,118	)		-
Long-term debt		(236,712	)		-
Comprehensive income		(42,735	)		-
Cash		43,851			-
Total net assets acquired		(935,760	)		-
Consideration per Share Exchange Agreement		2,063,315			-
Goodwill/(Bargain Purchase Gain)	$	2,999,075		$	-
Common stock issued for conversion of long-term debt, related and unrelated parties	$	224,688		$	-

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

F-32

TRAQIQ, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(IN US$)

(UNAUDITED)

NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS

TraQiQ, Inc. (along with its wholly owned subsidiaries, referred to herein as the “Company”) was incorporated in the State of California on September 9, 2009 as Thunderclap Entertainment, Inc. On July 14, 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc. On July 19, 2017, the Company entered into a Share Exchange Agreement (“Share Exchange”) with the stockholders of OmniM2M, Inc. (“OmniM2M”) and TraQiQ Solutions, Inc. dba Ci2i Services, Inc. (formerly Ci2i Services, Inc. – amended November 6, 2019) (“Ci2i”) whereby the stockholders of Omni and Ci2i exchanged all of their respective shares, representing 100% ownership in OmniM2M and Ci2i in exchange for 12,000,000 shares of the Company’s common stock, respectively. The OmniM2M Shareholders and the Ci2i Shareholders have each been issued their respective 12,000,000 shares on a pro rata basis based on their respective holdings in OmniM2M and Ci2i in the Share Exchange Agreement. The Share Exchange was accounted for as a reverse merger whereas Ci2i is considered the accounting acquirer and TraQiQ,Inc. is considered the accounting acquiree. For accounting purposes, the acquisition of Omni is recorded at historical cost in accordance with Accounting Standard Codification (“ASC”) 805-50-25-2 as this is considered an acquisition of entities under common control as the management of the Company and Omni control the activities of the respective companies. Prior to the merger with Ci2i and acquisition of Omni, the Company was considered a shell company under Rule 12b-2 of the Exchange Act. On December 1, 2017, The Company entered into a Share Purchase Agreement (the “Share Exchange Agreement”) with Ajay Sikka (“Sikka”), the sole shareholder of Transport IQ, Inc. whereby Sikka agreed to sell all of the shares in TransportIQ, Inc. (“TransportIQ”) in exchange for $18,109, in the form of cancellation of all of the debt of TransportIQ that is owed to the Company. The transaction became effective upon the execution of the Share Exchange Agreement by Sikka and the Company; and Transport IQ, Inc, is now a wholly-owned subsidiary of the Company. Because TransportIQ was commonly controlled and owned, the transaction was recorded at the historical carrying value of TransportIQ’s assets and liabilities.

TraQiQ Solutions, Inc.

This entity was formed about over 15 years ago and has most recently been providing technology solutions, predominantly in the business intelligence and data analytics arenas. The Company has been a vendor to Microsoft for over 10 years and has done work with many Microsoft product and business groups, including Microsoft Azure and Microsoft Media planning. Ci2i has worked closely with customers where a wide variety of analytics solutions were built.

Ci2i’s cloud solutions and analytics services comprise software development, program management, project management, and business analytics services.

TraQiQ Solutions Private Limited

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation (“Mann”). On January 2, 2020, Mann changed its name to TraQiQ Solutions Private Limited (“TRAQ Pvt Ltd”). Pursuant to the Share Exchange Agreement with Mann, the Company acquired 100% of the shares of Mann and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing. This transaction is being recorded as a business combination under ASC 805.

F-33

The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately. A total of 419,127 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.

Mann-India Private limited was renamed to TraQiQ Solutions Private Limited shortly after acquisition by TraQiQ Inc.

TRAQ Pvt Ltd. was established in May 2000 and is headquartered in New Delhi, India. TRAQ Pvt Ltd. is a leading software development company which, with the advent of technology, has evolved as a mature and fast-growing company committed to provide reliable and cost-effective software solutions across industries all over the world.

TRAQ Pvt Ltd. has its own experienced team of software developers dedicated towards developing various kinds of customized software.

TraQ Pvt Ltd. has been doing business around the world for over 15 years, with particular emphasis on Latin America and India. The customer list includes large enterprise Finance and Insurance companies across Latin America. The company’s product portfolio has evolved rapidly and now includes enterprise ready solutions for payment processing, mobile wallets, micro lending solutions and digital transformation.

The Company helps businesses in emerging economies leverage the gig/task economy with a three-prong approach:

● Target: We help companies target end-customer requirements, analyze their behaviors and offer them the right product or service at the right time.

● Transact: We facilitate end-customer transactions by providing a full set of fin-tech tools, including multi-tiered e-wallets, a settlement engine, and a workflow tool to enable digital commerce.

● Deliver: We provide cloud-based software solutions to manage delivery networks and, in addition, operate a nation-wide network of task associates who make deliveries and fulfill tasks across the supply chain in India.

With operations concentrated in India, Southeast Asia and Latin America, the Company is capitalizing on such growing trends as customer analytics, digital payments taking the place of traditional banking transactions and last mile delivery using task associates. Through its TraQSuite product, the Company provides an integrated solution for businesses seeking to set up an e-commerce operation with customer identification and targeting, payment systems and delivery. With its Mimo subsidiary, the Company runs a delivery and task network of approximately 14,000 people across India.

F-34

Target

From its early uses for recommendations of on-line movie preferences and suggested products for on-line shopping, artificial intelligence has become a powerful tool for driving the transformation of business to digital platforms and facilitating business growth. The Company’s management believes the use and application of artificial intelligence solutions to the retail analytics market will grow rapidly as tech resources using it become more affordable and easily available.

The Company uses artificial intelligence tools to provide business intelligence and data solutions. The Company capitalizes on the desire of customers to be rewarded by helping its B2B clients build loyalty and rewards programs. Many businesses have started offering discounts and rewards to customers each time they use their mobile wallets or buy their product or service as a way to incentivize customers to remain loyal to their brand. Once some retailers begin offering such a program, customers expect it with all of their transactions, and retailers that do not offer such an incentive risk a competitive disadvantage. The Company can help in building a more effective dashboards for AI-based decision-making tools or can build real-time systems that monitor data feeds from customer transactions. The Company’s clients can use insights from this data to improve customer experience, improve their business operations and provide the right target audience for marketing initiatives.

The Company’s Kringle™ tool analyzes the behaviors and transactions of the customers of a business across multiple purchasing channels and delivers real-time intelligence to a business, enabling targeted marketing. Powered by an AI-based e-commerce Intelligence Engine developed over the past seven years by a team of machine learning engineers, data scientists and PHDs, Kringle™ is able to deliver real time, automated one-to-one recommendations and personalized content across all customer touch points.

Transact

Payment methods for goods and services have evolved over thousands of years from barter to precious metal coins to paper money to checks to credit cards and, most recently, to digital currency and payments. Digital payments convert traditional cash transactions to cashless ones using software and other modern technologies. Digital payments create efficiencies and save money, and they also leave a digital trail that protects the users.

The business world has aggressively moved toward digital payments with ACH payments, wire transfers and EDI-based solutions. In the consumer world, where customers have access to digital payment tools such as mobile wallets through financial institutions, their use has evolved from being a niche payment method for consumers who are digitally-savvy to a payment method which is mainstream. The Company views this untapped market for digital payments as an opportunity, both for businesses and financial institutions that want to supply products and services to these customers and for the Company to help businesses satisfy that customer demand.

The Company’s TraQSuite™ product offers an enterprise-ready suite of FinTech tools. TraQSuite enables payment processing, mobile wallets, micro lending solutions and digital transformation solutions. Users can virtually store and use financial assets including G2P, B2P, welfare, salary, cards and micro banking like loans and insurance. Both banked and unbanked end customers can buy products and services and pay with their mobile devices using TraQSuite. The system also allows businesses and their customers to settle their transactions across all wallets, vendors, currencies and geographies.

Deliver

In order to complete a sale, a business must actually deliver its products to its customers, which usually includes the “last mile” to the customer’s physical location. While this has always been significant, the global COVID-19 pandemic has dramatically increased demand for product delivery, turning a valuable additional service into a “must-have” capability for businesses. Last-mile delivery aims to transport or deliver an item to its recipient in the quickest way possible, and customers will often make purchase decisions based on the speed, cost and reliability of delivery of the product.

The traditional approach to last-mile delivery is owning an operational fleet, which poses a high risk and potentially high costs, making it an unattractive solution for all by the largest retailers. Smaller companies often prefer to partner with delivery network carriers (DNCs) to handle the delivery, which allows the retailer to transfer a portion of the risk to one or more DNC providers. DNC providers often adopt a “gig” mindset using short-term independent contractors to make the actual delivery, which allows a DNC provider to transact and operate at a fraction of the cost of retaining and operating a delivery fleet. A “gig” business model uses a flexible work force of short-term, freelance independent contractors fulfilling targeted needs and paid on a per-task basis. This can benefit workers seeking lifestyle flexibility and businesses seeking a workforce sized to meet the needs of the moment.

F-35

The Company facilitates last-mile delivery and utilization of the “gig” workforce trend in two important ways – by providing software that allows its business clients to set up and manage last-mile delivery and task-based systems and by actually providing task-worker-based last mile delivery and payment collection systems in a major emerging market where there is no realistic alternative.

TraQSuite’s Last Mile software module provides a distribution platform that allows businesses to set up task-based networks rapidly – facilitating and validating transactions, and tracking and managing task associates. The Last-Mile software module enables a complete distribution engine for the new economy, designed to manage thousands of task associates across multiple geographies to deliver products and services to users while tracking the task associates and providing validation for the transactions. Mobile apps enable data sharing, validation and measurement of customer satisfaction.

In addition, the Company provides actual delivery and task-based services for businesses in one emerging market to solve problems that cannot be conveniently addressed using traditional methods. The Company’s Mimo-Technologies subsidiary runs a network of approximately 14,000 task associates in India. This team was set up by and is managed with the TraQSuite product. In addition to its rapidly growing business making task-based food, alcohol and medicine deliveries, Mimo is now collecting payments on behalf of B2B customers in India. The area of payment collections is especially critical for financial services companies who need to collect money from people without credit cards or a bank accounts. Mimo associates collect monthly payments from entrepreneurs with small microfinance loans for equipment or working capital. Mimo associates also collect payments from subscribers to Railtel, one of the largest broadband infrastructure providers in India that operates a nationwide fiber network running alongside train tracks. Mimo collects a transaction fee for each transaction that is completed. All the task associates are independent contractors who get paid for every task that is completed.

Rohuma, LLC

On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuna members agreed to exchange all of their respective membership interests in Rohuma in exchange for 4,292,220 shares of common stock, of which the first tranche of shares were issued on March 1, 2021 totaling 2,562,277 shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $3,433,776 ($0.80 per share). Rohuma has an Indian affiliate that is owned 99% by Rohuma and 1% by its founding member. Rohuma controls this entity and the 1% ownership by the member is now less than 1% upon acquisition by the Company. This amount is reflected as a non-controlling interest.

Rohuma dba Kringle.ai is a California based software solutions company that enables digital and mobile commerce by providing enterprise class applications that cover loyalty and rewards products, payments, online ordering, distribution logistics for retail and more. Kringle analyzes customers’ omni-channel behaviors and transactions. Using AI for digital commerce, Kringle is able to deliver real time, automated 1:1 recommendations and personalized content across all customer touch points.

Mimo Technologies Private Limited

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 1,367,539 shares of the Company’s common stock. Of these warrants, 820,524 were earned at the date of acquisition, with the remaining 547,015 expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.001 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.

Mimo provides delivery and task worker solutions across India. Mimo works with Banking, Financial, Logistics and Distribution companies, to take their products and services to semi-urban and rural India. Mimo trains the agents in each Product or Service through an online and classroom training platform. The company powers the gig economy task workers throughout the country and provides a very valuable source of employment for young people who may or may not have a high school diploma.

NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the regulations of the United States Securities and Exchange Commission. The condensed consolidated financial statements and accompanying notes are the representations of the Company’s management, who are responsible for their integrity and objectivity. In their opinion, such financial information includes all adjustments considered necessary for a fair presentation at such date and the operating results and cash flows for such periods.

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These condensed consolidated financial statements should be read in conjunction with a reading of the Company’s consolidated financial statements and notes thereto included in Form 10-K filed with the SEC on March 22, 2021. Interim results of operations for the six months ended June 30, 2021 are not necessarily indicative of future results for the full year.

Consolidation

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

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

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

Noncontrolling Interests

In accordance with ASC 810-10-45 Noncontrolling Interests in Consolidated Financial Statements, the Company classifies noncontrolling interests as a component of equity within the consolidated balance sheet. In January 2021, the acquisition of Rohuma resulted in a less than 1% non-controlling interest of the Indian affiliate of that company. In February 2021, the acquisition of Mimo resulted in a less than 1% non-controlling interest of that company.

Use of Estimates

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

Foreign Currency Transactions

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

Reclassification

Certain prior period amounts have been reclassified to conform with current period presentation with no effect on the Company’s net loss, total assets, liabilities equity or cash flows.

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Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and on deposit at banking institutions as well as all highly liquid short-term investments with original maturities of 90 days or less of $137,530 and $29,658 as of June 30, 2021 and December 31, 2020, respectively.

Restricted Cash

The Company’s restricted cash balance consists of time deposits with financial institutions which are valued at cost and approximate fair value. Interest earned on these deposits in included in interest income. The carrying value of our restricted cash at June 30, 2021 and December 31, 2020 was $165,488 and $28,746, respectively. The balances consist of time deposits pledged with financial institutions for a Line of Credit facility taken from Andhra Bank, issuance of overdraft limit.

Accounts Receivable and Concentration of Credit Risk

The Company considers accounts receivable, net of allowance for returns and doubtful accounts, to be fully collectible. The allowance is based on management’s estimate of the overall collectability of accounts receivable, considering historical losses and economic conditions. Based on these same factors, individual accounts are charged off against the allowance when management determines those individual accounts are uncollectible.

Credit extended to customers is generally uncollateralized. Past-due status is based on contractual terms. Management has determined that an allowance of $160,403 and $0 was required for the outstanding accounts receivable as of June 30, 2021 and December 31, 2020, respectively.

Property and Equipment and Long-Lived Assets

Fixed assets are stated at cost. Depreciation on fixed assets are computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years.

FASB Codification Topic 360 “Property, Plant and Equipment” (ASC 360), requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The application of ASC 360 has not materially affected the Company’s reported earnings, financial condition or cash flows.

Intangible assets with definite useful lives are stated at cost less accumulated amortization. Intangible assets represent purchased intangible of TRAQ Pvt Ltd. which includes customer relationships and trademarks. The Company amortizes these intangible assets on a straight-line basis over their estimated useful lives of 15 years. OmniM2M has had and currently does have computer software development underway, however, has determined that the costs associated with this development, currently do not meet the requirements for capitalization under ASC 985-20-25. OmniM2M will continue to monitor the development of such software in relationship to the requirements under the ASC in the future to determine if capitalization is warranted.

The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The adoption of this ASU did not have a material impact on our consolidated financial statements. The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets.

The Company will assess the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable at the time they do have intangible assets. Factors the Company considers to be important which could trigger an impairment review include the following:

1. Significant underperformance relative to expected historical or projected future operating results;

2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and

3. Significant negative industry or economic trends.

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When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company will measure any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. Management has determined that no impairment of long-lived assets is required for the periods ended June 30, 2021 and December 31, 2020.

Capitalized Software Costs

In accordance with the relevant FASB accounting guidance regarding the development of software to be sold, leased, or marketed, the Company expenses such costs as they are incurred until technological feasibility has been established, at and after which time these costs are capitalized until the product is available for general release to customers. Once the technological feasibility is established per ASC 985-20, the Company capitalizes costs associated with the acquisition or development of major software for internal and external use in the balance sheet.

Costs incurred to enhance the Company’s software products, after general market release of the services using the products, is expensed in the period they are incurred.

The Company only capitalizes subsequent additions, modifications or upgrades to internally developed software to the extent that such changes allow the software to perform a task it previously did not perform. The Company expenses software maintenance and training costs as incurred. The Company acquired $146,065 in software costs in the Mimo transaction.

Revenue Recognition

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

Professional Service Revenue

TRAQ Pvt Ltd. derives a large part of its revenues from professional and support services, which includes revenue generated from software development projects and associated fees for consulting, implementation, training, and project management provided to customers using their systems. Revenue from arrangements with customers is recognized based on the Company’s satisfaction of distinct performance obligations identified in each agreement, generally at a point in time as discussed in ASC 606. In instances where multiple performance obligations are identified, the Company allocates the transaction price to each performance obligation based on relative selling prices of each distinct product or service, and recognizes revenue related to each performance obligation at the points in time that each performance obligation is satisfied. The Company’s performance obligation includes providing customization of software’s, selling of licenses, where the Company typically satisfies its performance obligations prior to the submission of invoices to the customer for such services. The Company’s performance obligation for consulting and technical support is delivered on as the work is being performed, which is satisfied prior to invoicing.

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The Company generally collects payment within 30 to 60 days of completion of the performance obligation and there are no agency relationships.

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

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

TRAQ Pvt Ltd. has deferred the revenue and costs attributable to certain process transition activities with respect to its customers where such activities do not represent the culmination of a separate earnings process. Such revenue and costs are subsequently recognized ratably over the period in which the related services are performed. Further, the deferred costs are limited to the amount of the deferred revenues.

TRAQ Pvt Ltd. has now started offering an integrated solution for supply chain and last mile. This product called “TraQSuite” is now offered in multiple markets as a cloud-based subscription offering. This is a significant improvement from the earlier professional services business.

Software Solution Revenue

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

The following is a summary of revenue for the six months ended June 30, 2021 and 2020, disaggregated by type:

	2021		2020
Professional Services Revenue	$	593,898	$	463,385
Sale of goods		544,793		-
Software Solution Revenue		180,697		57,934
	$	1,319,388	$	521,319

Costs of Services Provided

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

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Lease Obligations

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

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately.

Income Taxes

Income taxes are accounted under the asset and liability method. The current charge for income tax expense is calculated in accordance with the relevant tax regulations applicable to entity. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance if, based on available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Uncertain Tax Positions

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

TraQiQ, Inc., TraQiQ Solutions, OmniM2M and TransportIQ file a consolidated income tax return in the U.S. federal tax jurisdiction and various state tax jurisdictions. TRAQ Pvt Ltd. files income tax returns in all India tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed. The India tax returns of TRAQ Pvt Ltd. are subject to examination by the India Income Tax Department and India state taxing authority, generally for 12 months after the relevant tax year, 24 months after the relevant tax year in case transfer pricing provisions are applicable.

Fair Value of Financial Instruments

ASC 825, “Financial Instruments,” requires the Company to disclose estimated fair values for its financial instruments. The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses, stockholder advances, short term financing and convertible debt approximate fair value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.

Fair Value Measurements

ASC 820 “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements.

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The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

These consolidated financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates.

In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management for the respective periods. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, investments, short-term notes payable, accounts payable and accrued expenses.

Derivative Financial Instruments

Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of the convertible instruments are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model we use for determining the fair value of our derivatives are binomial pricing models. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss).

With the issuance of the July 2017 FASB ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features, the Company has chosen the early adopt retroactively the amendments in Part I of the standard whereby fair value derivative liabilities previously recognized were derecognized in the current and comparative periods. Under the amendments included in this update, the Company is no longer required to record changes in fair value during the period of change as a separate component of other income (expense) in the consolidated Statements of Operations.

The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (in Topic 260).

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The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.

Under current GAAP, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in Topic 480 is evaluated under the guidance in Topic 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting.

Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date.

The amendments in this Update revise the guidance for instruments with down round features in Subtopic 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in Subtopic 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated.

For entities that present EPS in accordance with Topic 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by the Topic 260 amendments in this Update.

Those amendments in Part I of this Update are a cost savings relative to current GAAP. This is because, assuming the required criteria for equity classification in Subtopic 815-40 are met, an entity that issued such an instrument no longer measures the instrument at fair value at each reporting period (in the case of warrants) or separately accounts for a bifurcated derivative (in the case of convertible instruments) on the basis of the existence of a down round feature. For convertible instruments with embedded conversion options that have down round features, applying specialized guidance such as the model for contingent beneficial conversion features rather than bifurcating an embedded derivative also reduces cost and complexity. Under that specialized guidance, the issuer recognizes the intrinsic value of the feature only when the feature becomes beneficial instead of bifurcating the conversion option and measuring it at fair value each reporting period.

The amendments in Part II of this Update replace the indefinite deferral of certain guidance in Topic 480 with a scope exception. This has the benefit of improving the readability of the Codification and reducing the complexity associated with navigating the guidance in Topic 480.

For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways:

1.	retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective; or
2.	retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

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The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.

Earnings (Loss) Per Share of Common Stock

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

Related Party Transactions

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

Retirement Benefits to Employees

Defined Contribution Plan

In India, the employees receive benefits from a provident fund, where the employer and employees each make monthly contributions to the plan at a pre-determined rate to the Regional Provident Fund Commissioner. Employer’s contributions to the fund is charged as an expense in the Statements of Operations.

Defined Benefit Plan

In accordance with the Payment of Gratuity Act, 1972, applicable for Indian companies, TRAQ Pvt Ltd. provides for a lump sum payment to eligible employees, at retirement or termination of employment based on the last drawn salary and years of employment with the Company. Current service costs for defined benefit plans are accrued in the period to which they relate. The liability in respect of defined benefit plans is calculated annually by TRAQ Pvt Ltd. TRAQ Pvt Ltd. records annual amounts relating to its defined benefit plans based on calculations that incorporate various actuarial and other assumptions, including discount rates, mortality, assumed rates of return, compensation increases and turnover rates. TRAQ Pvt Ltd. reserves its assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when it is appropriate to do so. TRAQ Pvt Ltd.’s obligation in respect of the gratuity plan, which is a defined benefit plan, is provided for based on actuarial valuation.

Other Long-Term Employee Benefits

TRAQ Pvt Ltd.’s net obligation in respect of leave encashment is the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is based on the prevailing market yields of Indian government securities at the reporting date that have maturity dates approximating the terms of TRAQ Pvt Ltd.’s obligations. The calculation is performed using the projected unit credit method. Any actuarial gains or losses are recognized.

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Investments

The Company’s investments are in debt and equity instruments. These investments are accounted for in accordance with ASC 320 Investments – Debt Securities and ASC 321 Investments – Equity Securities. Interest earned under such investments are included in interest income.

Segment Reporting

For purposes of segment disclosures, two or more operating segments should be grouped only if the segments meet all the requirements of paragraph 280-10-50-11, including the requirements for similar economic characteristics.

As a result, all operating units perform similar services, and approximately 99% of the Company’s revenue is generated from its Indian subsidiary. The Company believes that no segment reporting is required as all remaining operations outside of the Indian subsidiary is immaterial.

Recently Issued Accounting Standards

There were updates recently issued, most of which represent technical corrections to the accounting literature or application to specific industries or transactions that are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

Going Concern

The Company has an accumulated deficit of $6,008,129 and a working capital deficit of $8,120,378, as of June 30, 2021, and a working capital deficit of $2,851,721 as of December 31, 2020. As a result of these factors, management has determined that there is substantial doubt about the Company ability to continue as a going concern.

These consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.

The Company plans to raise additional capital to carry out its business plan. The Company’s ability to raise additional capital through future equity and debt securities issuances is unknown. Obtaining additional financing and the successful development of the Company’s contemplated plan of operations, ultimately, to profitable operations, are necessary for the Company to continue operations.

NOTE 3: ACQUISITIONS

TRAQ PVT LTD

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation. On January 2, 2020, the name of this company was changed to TRAQIQ Solutions Private Limited. Pursuant to the Share Exchange Agreement with TRAQ Pvt Ltd., the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities) in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately upon closing; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing.

The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately. A total of 419,127 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.

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The Company acquired the assets and liabilities noted below in exchange for the warrants noted herein and accounted for the acquisition in accordance with ASC 805. As a result, total consideration was equal to the value of the warrants of $268, as stated in the agreement, and the Company recognized a gain on bargain purchase in the amount of $417,148.

ROHUMA

On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuna members agreed to exchange all of their respective membership interests in Rohuma in exchange for 4,292,220 shares of common stock, of which the first tranche of shares were issued on March 1, 2021 totaling 2,562,277 shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $3,433,776 ($0.80 per share). Rohuma has an Indian affiliate that is owned 99% by Rohuma and 1% by its founding member. Rohuma controls this entity and the 1% ownership by the member is now less than 1% upon acquisition by the Company. This amount is reflected as a non-controlling interest.

The Company acquired the assets and liabilities noted below in exchange for the shares noted herein and accounted for the acquisition in accordance with ASC 805.

Cash	$	6,027
Accounts receivables, net		4,179
Prepaid expenses and other current assets		8,943
Fixed assets		4,512
Investment		1,440
Accounts payable and accrued expenses		(58,153	)
Accrued duties and taxes		(2,688	)
Cash overdraft		(2,980	)
Debt – related parties		(37,776	)
Debt		(10,000	)
	$	(86,496	)

The difference between the net liabilities acquired of $86,496, and the consideration paid (in the form of shares, inclusive of contingent consideration of $1,383,954) of $3,520,272 represents goodwill.

MIMO TECHNOLOGIES

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 1,367,539 shares of the Company’s common stock. Of these warrants, 820,524 were earned at the date of acquisition, with the remaining 547,015 expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.001 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.

F-46

The Company acquired the assets and liabilities noted below in exchange for the warrants noted herein and accounted for the acquisition in accordance with ASC 805.

Cash	$	43,851
Accounts receivables, net		58,692
Prepaid expenses and other current assets		272,872
Fixed and intangible assets		153,186
Accounts payable and accrued expenses		(708,833	)
Accrued payroll and related taxes		(104,750	)
Accrued duties and taxes		(28,213	)
Comprehensive income		(42,735	)
Debt – related parties		(343,118	)
Debt		(236,712	)
	$	(935,760	)

The difference between the net liabilities acquired of $935,760, and the consideration paid (in the form of cash and warrants, net of adjustments for the note payable and accounts payable of Mimo with TRAQ Pvt Ltd) of $2,085,653 represents goodwill in the amount of $3,021,413.

The following table shows pro-forma results for the six months ended June 30, 2021 and 2020 as if the acquisition had occurred on January 1, 2020. These unaudited pro forma results of operations are based on the historical financial statements and related notes of Rohuma, Mimo and the Company.

	For the six months ended June 30, 2021			For the six months ended June 30, 2020
Revenues	$	1,355,350		$	732,415
Net income (loss)	$	(3,555,172	)	$	(488,535	)
Net income (loss) per share	$	(0.12	)	$	(0.02	)

NOTE 4: CASH AND RESTRICTED CASH

Cash and restricted cash are as follows:

	June 30, 2021		December 31, 2020
Cash on hand	$	109	$	141
Bank balances		137,421		29,517
Restricted cash		165,488		28,746
Total	$	303,018	$	58,404

ASU 2016-18, “Statements of Cash Flows” (Topic 230) was adopted by the Company in 2017. In accordance with this standard, restricted cash and restricted cash equivalents is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the Statements of Cash Flows. During the six months ended June 30, 2021 and the year ended December 31, 2020 there were no cash equivalents.

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NOTE 5: FIXED ASSETS

The Company’s property and equipment is as follows:

	June 30, 2021			December 31, 2020			Estimated Life
Property and equipment – TRAQ Pvt Ltd.	$	628,026		$	638,587		3 - 10 years
Property and equipment – Rohuma US		1,100			-		3 - 10 years
Property and equipment – Rohuma India		4,117			-		3 – 10 years
Property and Equipment – Mimo Technologies		2,927			-		3 – 10 years
Less: accumulated depreciation		(599,351	)		(602,214	)
Net	$	36,819		$	36,373

Depreciation expense for the six months ended June 30, 2021 and 2020 was $11,615 and $8,186, respectively.

NOTE 6: INTANGIBLE ASSETS

The Company’s intangible assets are as follows:

	June 30, 2021			December 31, 2020
Customer relationships	$	448,800		$	448,800
Tradenames		49,799			49,799
Software		250,451			-
Less: accumulated amortization		(185,418	)		(54,015	)
Net	$	563,632		$	444,584

Amortization expense for the six months ended June 30, 2021 and 2020 was $25,404 and $16,620, respectively.

NOTE 7: GOODWILL

The Company’s goodwill consists of the following:

	June 30, 2021		December 31, 2020
Rohuma	$	3,519,869	$	-
Mimo Technologies		2,987,811		-
Net	$	6,507,680	$	-

For the period ended June 30, 2021, there were no indicators of impairment noted.

NOTE 8: LONG-TERM INVESTMENT

The Company’s long-term investment is as follows:

	June 30, 2021		December 31, 2020
Equity Security – Compulsorily Convertible Debenture	$	-	$	40,603

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The investment the Company had in a 1% Compulsorily Convertible Debenture for the period of seven years were neither to be redeemed by the issuing entity nor are redeemable at the option of the investor, therefore this has been considered an equity security. The Company had elected to measure the equity security at its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The debenture was between TRAQ Pvt Ltd. and Mimo and was forgiven/written-off prior to the acquisition of Mimo on February 16, 2021.

In addition there was an investment acquired in the acquisition of Rohuma US for $1,440.

NOTE 9: NOTE RECEIVABLE

The Company’s notes receivable is as follows:

	June 30, 2021		December 31, 2020
MIMO Technologies PVT Ltd	$	-	$	227,877

The Company entered into a note receivable with a related party in the amount of 15,037,263 INR (approximately $170,000 US$) dated April 1, 2020 with no stated maturity date. The note bears interest at 13% per annum. Further, the Company provided additional amounts on October 5, 2020, to bring the total outstanding to 16,647,264 INR ($227,877 US$) as of December 31, 2020. Upon the acquisition of Mimo by the Company, the balance of $258,736 in the note receivable was reduced to zero and applied towards the purchase of Mimo.

NOTE 10: CONVERTIBLE NOTES PAYABLE

As of June 30, 2021 and December 31, 2020, the Company had the following convertible notes outstanding:

		June 30, 2021			December 31, 2020
GS Capital	(a)	$	105,000		$	-
Platinum Point Capital	(b)		400,000			-
Total Convertible Notes Payable		$	505,000		$	-
Less: Discounts			(176,902	)		-
		$	328,098		$	-

(a)

On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the amount of $125,000. The GS Note has a maturity of one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000. The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon achievement of the terms of the GS Note.

(b)

On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”). The Platinum Note has a maturity of one-year. The conversion price of the Platinum Note is the greater of (a) $0.01 or (b) 70% of the lowest closing stock price over the previous 15 trading days. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 200,000 warrants that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections, that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 60,000 shares as a commitment fee.

Interest expense on these notes for the six months ended June 30, 2021 and 2020 are $21,781 and $0, respectively. Amortization of debt and original issue discounts was $146,966 and $0 for the six months ended June 30, 2021 and 2020, respectively.

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NOTE 11: LONG-TERM DEBT RELATED PARTIES

The following is a summary of the current portion - long-term debt - related parties as of June 30, 2021 and December 31, 2020:

		June 30, 2021			December 31, 2020
Unsecured advances - CEO	(a)	$	2,006,691		$	1,718,277
Notes payable - Satinder Thiara	(b)		32,000			57,000
Promissory note – Kunaal Sikka	(c)		15,000			15,000
Notes payable – Swarn Singh	(d)		45,000			45,000
Note payable - Chaudhary	(e)		8,427			8,122
Note payable - Director	(g)		400,000			-
Advances – former CEO of Rohuma			15,141			-
Advances – former CEO of Mimo Technologies	(f)		122,580			-
			2,644,839			1,843,399
Current portion of long-term debt related parties			(2,629,839	)		(1,843,399	)
Long-term debt – related parties		$	15,000		$	-

(a)

This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at 15% annually (1.25% monthly) and are due on demand.

(b)

Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due December 31, 2021, December 13, 2016 ($10,000) which is due December 31, 2021, and May 1, 2018 ($25,000) which matured December 31, 2019 at interest rate of 15% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly). The May 1, 2018 note that matured December 31, 2019 was converted along with $12,392 in accrued interest into 43,990 shares of common stock on March 5, 2021.

(c)	Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on December 31, 2019, and accruing interest at an annual rate of 12%. The note was in default as of December 31, 2019 through June 25, 2021 when the note was extended until December 31, 2022. As a result the interest rate was changed to 18% annually (1.50% monthly) through June 25, 2021 and then changed to 6% annually.
(d)	Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of 15% annually (1.25% monthly). These are unsecured notes. Both notes were due December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).
(e)	Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of 1,100,000 INR (approximately $14,500 US$) due on demand at 13% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,179.
(f)	Note payable to Lathika Regunathan dated June 18, 2021 in the amount of 7,650,000 INR (approximately $100,000 US$) interest free and due on demand.
(g)	Note payable to a director dated June 15, 2021 that matures December 12, 2021 in the amount of $400,000. The note does not bear interest however the director received two tranches of 150,000 shares each for lending this amount. If the note is repaid by the maturity date, one of the two tranches of 150,000 shares will be returned.

Interest expense on these notes for the six months ended June 30, 2021 and 2020 are $158,537 and $107,869, respectively.

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NOTE 12: LONG-TERM DEBT

The following is a summary of the long-term debt as of June 30, 2021 and December 31, 2020:

		June 30, 2021			December 31, 2020
Other debt – in default	(a)	$	6,000		$	6,000
Yukti Securities Private Limited	(b)		-			4,547
Noor Qazi	(c)		-			-
Auto loan – ICICI Bank	(d)		14,769			18,539
Baxter Credit Union	(e)		99,975			99,911
UGECL	(f)		53,960			54,563
USA Bank PPP	(g)		-			10,057
Loan Builder	(h)		47,367			-
Satin			141,097			-
SBA - Rohuma			10,000			-
Total		$	373,168		$	193,617
Current portion			(317,876	)		(133,761	)
Long-term debt, net of current portion		$	55,292		$	59,856

(a)	Note payable to an individual for $7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made a payment of $1,500 against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider.
(b)	Loan payable to Yukti Securities Private Limited is an unsecured loan which is due on demand.
(c)	Unsecured loan from Noor Qazi, individual, is due on demand. Was repaid in December 2020.
(d)	Loan payable with ICICI Bank, secured by the vehicle the loan was taken for. Payments are monthly at $752, through maturity in May 2023. Of the amount outstanding, the following represents the maturity: Current (2021-2022) $7,374; (2022-2023) $7,395.
(e)	Revolving loan in the amount of $100,000 at 4% interest per annum due December 30, 2020. The loan was renegotiated for a balance of $99,911 with similar terms at 4% interest per annum and is guaranteed by the CEO of the Company.
(f)	COVID line of credit from UGECL up to 4,000,000 INR in India, term of 48 months, interest only at 7.5% annual rate for first 12 months, then 36 equal instalments through maturity. Current (2021) $6,063; long-term (2022-2024) $47,897.
(g)	PPP loan from USA Bank, with interest accruing at 1% per annum. Original amount of $34,697 had $24,640 forgiven in December 2020, with the remaining $10,057 due in five years In February 2021, the Company was notified that the entire balance of the PPP loan has been forgiven.
(h)	$50,000 unsecured loan due in 52 weekly payments of $1,057.94 inclusive of interest at approximately 10%.

Interest expense on these notes for the six months ended June 30, 2021 and 2020 are $2,539 and $5,546, respectively.

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NOTE 13: CURRENT PORTION - CONVERTIBLE DEBT – RELATED AND UNRELATED PARTIES

The following is a summary of current portion - convertible debt - related and unrelated parties as of June 30, 2021 and December 31, 2020:

		June 30, 2021		December 31, 2020
Face value of notes – related party	(a)	$	-	$	95,000
Face value of notes – unrelated parties	(a)		68,077		98,077
Excess of the fair value of shares issuable over the face value of the convertible notes	(a)		17,007		48,257
		$	85,084	$	241,334

(a)

In connection with the reverse merger in July 2017, the Company and two stockholders, who had provided related party advances to the Company, agreed to exchange their related party advances for 6% Convertible Promissory Notes that were originally due on January 15, 2018 (the “Notes”) in the amount of $68,077. From August 2017 through November 2017, the Company issued additional notes to four different parties (two of which were related parties) in the principal amount of $100,000 ($70,000 to related parties). In January 2018, the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019. The Notes bear simple interest at 6% unless the Company defaults, which increases the interest rate to 10%. The Holders, at their option, can elect to convert the principal plus any accrued interest, into shares of the Company’s common stock at a conversion rate equal to eighty percent (80%) of the average closing share price as quoted on the OTC Markets for the five (5) trading days prior to the date of conversion. There are two notes that had a maturity date of June 30, 2019, with the remaining notes having a maturity date of December 31, 2019. These notes had not been extended and were in default until June 30, 2021, when the note holders agreed to extend the debt until October 31, 2021, with no other changes to the notes. The Company has classified these notes as current liabilities. The Company had accrued the default interest on the two notes from July 1, 2019 through March 4, 2021. On March 5, 2021, the Company converted $156,250 in convertible notes which includes the excess of the fair value of shares issuable over the face value of the convertible notes along with $31,046 in accrued interest into 187,296 shares of common stock.

During the year ended December 31, 2018, the Company received additional proceeds from a related party of $25,000 (from Dharam V. Sikka, father of CEO) pursuant to a convertible note payable issued in May 2018, with the same interest rate and conversion terms as the Notes described above, initially maturing on December 31, 2018, which has been extended to March 31, 2019 and then again to December 31, 2019. Because the Notes are convertible into a variable number of shares of common stock based on a fixed dollar amount, in accordance with ASC Topic 480-10-50-2, the notes are recorded at the fair value of the shares issuable upon conversion. The excess of the fair value of shares issuable over the face value of the Notes is recorded as a discount to the note to be amortized into interest expense over the term of the note.

Interest expense on these notes for the six months ended June 30, 2021 and 2020 are $5,499 and $9,627, respectively.

The Company has calculated the stock-settled liability in accordance with ASC 835-30 which establishes the monetary value at settlement of these instruments at fair value.

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NOTE 14: STOCKHOLDERS’ EQUITY (DEFICIT)

Series A Convertible Preferred Stock

On July 19, 2017, the Company approved the issuance of 50,000 shares of its Series A Convertible Preferred Stock to its CEO and, on August 1, 2017, the Company sold and issued the 50,000 shares of its Series A Convertible Preferred Stock to its CEO at a price of $0.20 per share for $10,000.

Each outstanding share of Series A Convertible Preferred Stock is convertible into the number of shares of the Company’s common stock (the “Common Stock”) determined by dividing the Stated Value by the Conversion Price as defined below, at the option of any Series A Convertible Preferred Stock shareholder in whole or in part, at any time commencing no earlier than six (6) months after the issuance date; provided that any conversion under this section must be made during the ten (10) day period immediately following the date on which the corporation files with the Securities and Exchange Commission any periodic report on form 10-Q, 10-K or the equivalent form; provided further that, any conversion under this Section IV: (a) shall be for a minimum Stated Value of $500 of Series A Convertible Preferred Stock.

The Conversion Price for each share of Series A Convertible Preferred Stock in effect on any Conversion Date shall be (i) eighty five percent (85%) of the average closing bid price of the Common Stock over the twenty (20) trading days immediately preceding the date of conversion, (ii) but no less than par value of the Common Stock. For purposes of determining the closing bid price on any day, reference shall be to the closing bid price for a share of Common Stock on such date on the OTC Markets, as reported on Bloomberg, L.P. (or similar organization or agency succeeding to its functions of reporting prices) (the “Per Share Market Value”).

Common Stock

As of June 30, 2021, the Company has 31,430,575 shares issued and outstanding.

During the three months ended June 30, 2021, the Company (a) issued 1,000 shares of common stock for services valued at $1,750. In addition, the Company recognized $40,222 in stock-based compensation for restricted stock grants to an advisor that vest over a three-year term. None of the 350,000 shares to this advisor have been issued as of June 30, 2021.; (b) issued 300,000 shares of common stock to a director for agreeing to lend the Company $400,000 in a promissory note. 150,000 of these shares may be returned to the Company should the note be repaid by the maturity date of December 12, 2021. These 300,000 shares have a value of $447,000; and (c) issued 35,000 shares for $38,500.

During the three months ended March 31, 2021, the Company (a) issued 570,000 shares of common stock for $456,000; (b) 264,338 shares of common stock for the conversion for $181,250 in convertible notes and $43,438 in accrued interest; (c) 400,000 shares of common stock for services rendered in the amount of $436,385; and (d) 2,562,277 shares (of a total of 4,292,220 to be issued) for the purchase of Rohuma.

There were no shares issued in the six months ended June 30, 2020.

On April 12, 2018, the Company amended its Articles of Incorporation to forward split all outstanding shares of common stock such that all issued and outstanding shares of Common Stock shall be automatically combined and reclassified such that each share of Pre-Forward Split Stock shall be combined and reclassified into four shares of Common Stock. The number of shares for all periods presented has been retroactively restated to reflect the forward split.

F-53

Common Stock Warrants

The following schedule summarizes the changes in the Company’s common stock warrants:

						Weighted				Weighted
	Warrants Outstanding					Average				Average
	Number			Exercise		Remaining		Aggregate		Exercise
	Of			Price		Contractual		Intrinsic		Price
	Shares			Per Share		Life		Value		Per Share
Balance at December 31, 2019		1,329,272		$	0.001		4.87 years	$	-	$	0.001
Warrants granted		-		$	-		-			$
Warrants exercised		-		$	-		-			$
Warrants expired/cancelled		-		$	-		-			$
Balance at December 31, 2020		1,329,272		$	0.001		3.87 years	$	2,125,506	$	0.001
Warrants granted		1,980,039		$	0.001-2.00		-			$
Warrants exercised/exchanged		-		$	-		-			$
Warrants expired/cancelled		(419,127	)	$	-		-			$
Balance at June 30, 2021		2,880,184		$	0.001-2.00		2.72 years	$	3,414,248	$	0.42
Exercisable at June 30, 2021		2,333,168		$	0.001-2.00		2.73 years	$	2,594,272	$	0.52

Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each option/warrant is estimated using the Black-Scholes valuation model. The following assumptions were used for the three months ended March 31, 2021 and year ended December 31, 2020:

	Six Months Ended June 30, 2021			Year Ended December 31, 2020
Expected term		3 years			-
Expected volatility		100-214	%		-
Expected dividend yield		-			-
Risk-free interest rate		0.15-0.58	%		-

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation. Pursuant to the Share Exchange Agreement, the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately upon closing; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing. The value of the transaction totaled $268 and is reflected as an increase to additional paid in capital. A total of 419,127 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.

On February 16, 2021, the Company entered into several stock purchase agreements for the issuance of 570,000 shares for cash in the amount of $456,000 (value of $0.80 per share). The individuals also received 285,000 warrants that have a term of three years at an exercise price of $2.00 per share.

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 1,367,539 shares of the Company’s common stock. Of these warrants, 820,524 were earned at the date of acquisition, with the remaining 547,015 expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.001 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.

F-54

On March 8, 2021, the Company entered into a consulting agreement to provide advisory services regarding strategic planning. The agreement is for a term of one-year. The agreement calls for payments to be paid monthly in the amount of $3,000 and the issuance of stock at the commencement of the agreement for 25,000 shares, and a three-year warrant for 100,000 warrants with a strike price of $2.00 per share that vest March 7, 2022.

Options

On November 23, 2020, the Board of Directors of the Company approved the 2020 Equity Incentive Plan.

On October 19, 2020, the Company granted 3,930,000 stock options to board members, advisory board members, employees and consultants. The options have a 10-year term, and are both service based grants, as well as performance-based grants. Stock-based compensation for the year ended December 31, 2020 was $104,638, and the unrecognized stock-based compensation for these grants as of December 31, 2020 is $660,372. Of the 3,930,000 options granted, only 312,500 have been vested through December 31, 2020.

In the six months ended June 30, 2021, the Company recognized $226,807 in stock-based compensation.

The following represents a summary of options:

	Six Months Ended June 30, 2021				Year Ended December 31, 2020
	Number		Weighted Average Exercise Price		Number		Weighted Average Exercise Price
Beginning balance		3,930,000	$	0.0052		-	$	-
Granted		-		-		3,930,000		0.0052
Exercised		-		-		-		-
Forfeited		-		-		-		-
Expired		-		-		-		-
Ending balance		3,930,000	$	0.0052		3,930,000	$	0.0052
Intrinsic value of options	$	5,874,475			$	6,267,475
Weighted Average Remaining Contractual Life (Years)		9.31				9.81

NOTE 15: OPERATING LEASE

The Company has adopted ASU No. 2016-02, Leases (Topic 842), as of January 1, 2019 and will account for their lease in terms of the right of use assets and offsetting lease liability obligations for this new lease under this pronouncement. In accordance with ASC 842 - Leases, effective January 1, 2019, the Company up until May 16, 2019 did not have any long-term lease commitments. On May 17, 2019 with the Company’s acquisition of TRAQ Pvt Ltd., recorded a lease right of use asset and a lease liability at present value of $576,566 and $585,207, respectively. The Company is recording this amount at present value, in accordance with the standard, using an incremental borrowing rate by adjusting the benchmark reference rates with appropriate financing spreads and lease specific adjustments for the effects of collateral. The right of use asset will be composed of the sum of all lease payments plus any initial direct cost and will be straight line amortized over the life of the expected lease term. For the expected term of the lease the Company will use the term of the nine-year lease. This lease will be treated as an operating lease under the new standard.

The Company has chosen to implement this standard using the modified retrospective model approach with a cumulative-effect adjustment, which does not require the Company to adjust the comparative periods presented when transitioning to the new guidance on January 1, 2019. The Company has also elected to utilize the transition related practical expedients permitted by the new standard. The modified retrospective approach provides a method for recording existing leases at adoption and in comparative periods that approximates the results of a modified retrospective approach.

F-55

The lease right of use asset of in the original amount of $592,909 was to be amortized on a straight-line basis over the term of the lease.

During the year ended December 31, 2020, the Company renegotiated their leases with the landlord for TRAQ Pvt Ltd. As a result of this renegotiation, the Company vacated one of their two leases, and as a result, impaired $333,571 in right-of-use asset and $349,428 in lease liability.

As of June 30, 2021, the value of the unamortized lease right of use asset is $118,237. As of June 30, 2021, the Company’s lease liability was $127,919.

Remaining Lease Obligation by calendar year (undiscounted cash flows)
2022	$	13,209
2023		28,593
2024		28,593
2025		29,487
2026		32,882
2027		58,914
Total lease payments		191,678
Less: Imputed interest		63,759
Present value of lease liabilities	$	127,919

For the six months ended June 30, 2021 and 2020 the Company recorded rent expense of $15,511 and $63,895.

NOTE 16: DERIVATIVE LIABILITIES

On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the amount of $125,000. The GS Note has a maturity of one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000. The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon achievement of the terms of the GS Note.

On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”). The Platinum Note has a maturity of one-year. The conversion price of the Platinum Note is the greater of (a) $0.01 or (b) 70% of the lowest closing stock price over the previous 15 trading days. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 200,000 warrants that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections, that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 60,000 shares as a commitment fee.

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Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each warrant is estimated using the Black-Scholes valuation model. The following assumptions were used in June 30, 2021 and December 31, 2020:

	Six Months Ended June 30, 2021			Year Ended December 31, 2020
Expected term		1 year			-
Expected volatility		164 - 214	%		-
Expected dividend yield		-			-
Risk-free interest rate		0.15	%		-

The Company’s derivative liabilities are as follows:

	June 30, 2021		December 31, 2020
Fair value of the GS Capital conversion option	$	280,000	$	-
Fair value of the Platinum Point conversion option		1,024,000		-
Fair value of the Platinum Point warrants (200,000 warrants)		206,000		-
	$	1,510,000	$	-

Activity related to the derivative liabilities for the period ended June 30, 2021 is as follows:

Beginning balance as of December 31, 2020	$	-
Issuances of warrants/conversion option – derivative liabilities		313,868
Warrants exchanged for common stock		-
Change in fair value of warrants/conversion option - derivative liabilities		1,196,132
Ending balance as of June 30, 2021	$	1,510,000

There were no derivative liabilities prior to January 2021.

nOTE 17: CONCENTRATIONS

During the six months ended June 30, 2021 and 2020, the Company had two major customers comprising 87% of revenues and two major customers comprising 88% of revenues, respectively. A major customer is defined as a customer that represents 10% or greater of total revenues. There was 87% and 85% of accounts receivable representing two and two customers as of June 30, 2021 and December 31, 2020, respectively.

The Company does not believe that the risk associated with these customers or vendors will have an adverse effect on the business.

nOTE 18: CONTINGENCY

During the year ended December 31, 2018, the Company charged an independent truck driver approximately $190,000 pursuant to its agreement with the driver, which entitled the Company to fees equal to $800 per day for the driver’s failure to return a trailer owned by the Company with the period prescribed by the agreement. The Company has not recognized this as income due to uncertainty of payment and will record as other income during the period in which amounts are collected.

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nOTE 19: COMMITMENTS AND CONTINGENCIES

Commitments and contingencies in respect of TRAQ Pvt Ltd;

(i)	TRAQ Pvt Ltd had applied for compounding of the TDS liability for the assessment year 2014-2015 and 2015-2016 in accordance with Indian Income Tax Laws. However, no amount payable for tax and penalty was confirmed by the Income Tax Department. Further, TRAQ Pvt Ltd has also defaulted for TDS deducted but not paid in time during assessment years 2016-2017 to 2020-2021. Accordingly, there may be a contingent liability in respect of TDS regarding compounding charges, interest, and penalty which is not quantifiable at present, hence not provided in the Consolidated Financial Statements.
(ii)	TRAQ Pvt Ltd has outstanding Gratuity for $23,971 as of December 31, 2020, towards ex-employees of TRAQ Pvt Ltd; therefore, TRAQ Pvt Ltd is liable for penalty under The Gratuity Act under the Indian Laws and other relevant laws. Since the amount of penalty for default in payment of gratuity is not ascertainable, therefore it is not provided for in the Consolidated Financial Statements. Gratuity of $13,816 has been paid in the month of January 2021.
(iii)	There are numerous interpretative issues relating to the Indian Supreme Court (SC) judgment dated February 28, 2019, on Provident Fund (PF) on the inclusion of allowances for the purpose of PF contribution as well as its applicability. Due to a pending decision on the subject review petition and directions from EPFO, the impact has been recorded in the six months ended June 30, 2021 Consolidated Financial Statements.
(iv)	TRAQ Pvt Ltd has delayed in complying with provisions related to Foreign Direct Investment and Transfer of Shares to Non-resident as per the Master Circulars and notification issued by Reserve Bank of India, therefore, is liable for imposition of penalty. Since the amount of the penalty for the same is not ascertainable, no effect was given in the Consolidated Financial Statements.
(v)	Prior to its acquisition in May 2019, TRAQ Pvt Ltd, had provided a guarantee in favor of State Bank of India for $165,813 on March 22, 2014, for Mira Green Tech Private Limited. The State Bank of India is in process of satisfying whether there is any obligation due by TRAQ Pvt Ltd at this time.

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                        Shares of Common Stock

TraQiQ, Inc.

PRELIMINARY PROSPECTUS

ThinkEquity

, 2021

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution.

Registration Fee	$
FINRA Filing Fee
NASDAQ Global Market Listing Fee
Printing and Expenses
Accounting Fees and Expenses
Legal Fees and Expenses
Transfer Agent and Registrar Fees
Miscellaneous Fees and Expenses
Total	$

Item 14. Indemnification of Directors and Officers.

The Company is a California corporation.

Section 317 of the CGCL provides that a California corporation may indemnify any person who was or is, or is threatened to be made, a party to any threatened, pending or completed action or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation), by reason of the fact that such person is or was an officer, director, employee or agent of such corporation, or is or was serving at the request of such corporation as an officer, director, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees), judgments, fines, settlements and other amounts actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided that such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporation’s best interests and, with respect to any criminal action or proceeding, had no reasonable cause to believe that his or her conduct was illegal. Section 317 of the CGCL further authorizes a corporation to purchase and maintain insurance on behalf of any indemnified person against any liability asserted against and incurred by such person in any indemnified capacity, or arising out of such person’s status as such, regardless of whether the corporation would otherwise have the power to indemnify such person under the CGCL.

Section 204(a)(10) of the CGCL provides that a corporation’s articles of incorporation may include provisions eliminating or limiting the personal liability of a director for monetary damages for breach of fiduciary duties as a director, except for liability (i) for acts or omissions that involve intentional misconduct or a knowing and culpable violation of law, (ii) for acts or omissions that a director believes to be contrary to the best interests of the corporation or its shareholders or that involve the absence of good faith on the part of the director, (iii) for any transaction from which a director derived an improper personal benefit, (iv) for acts or omissions that show a reckless disregard for the director’s duty to the corporation or its shareholders in circumstances in which the director was aware, or should have been aware, in the ordinary course of performing a director’s duties, of a risk of a serious injury to the corporation or its shareholders, (v) for acts or omissions that constitute an unexcused pattern of inattention that amounts to an abdication of the director’s duty to the corporation or its shareholders, (vi) for interested party transactions that violate Section 310 of the CGCL, (vii) loan guaranties contrary to Section 315 of the CGCL or (viii) for unlawful payment of dividends, distributions or distributions of assets to shareholders after institution of dissolution proceedings that violate Section 316 of the CGCL.

Our amended articles of incorporation will provide for the elimination of liability for our directors for monetary damages to the fullest extent permissible under the CGCL and authorize us to indemnify our directors and officers in excess of the indemnification otherwise permitted by Section 317 of the CGCL, subject only to the applicable limits set forth in Section 204 of the CGCL with respect to actions for breach of duty to the corporation and its shareholders.

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Our amended bylaws will provide that we must indemnify any person who is or was our director or officer, or was serving at our request as a director or officer of another corporation or enterprise to the fullest extent authorized by law. Our amended bylaws will further provide that we must pay expenses incurred in defending any such proceeding in advance of its final disposition; provided that, if required by CGCL, such payment of expenses will only be made upon delivery of an undertaking, by or on behalf of an indemnified person, to repay all amounts so advanced if it should be determined ultimately that such person is not entitled to be indemnified under this section or otherwise.

We have an insurance policy covering our officers and directors with respect to certain liabilities, including liabilities arising under the Securities Act, the Exchange Act and otherwise.

The foregoing is only a general summary of certain aspects of California law and our governing documents and agreements dealing with indemnification of directors and officers, and does not purport to be complete. It is qualified in its entirety by reference to our amended articles of incorporation and amended bylaws, which are filed as an exhibit to this registration statement, and to the relevant provisions of the CGCL.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors and officers or for persons controlling us under any of the foregoing provisions, in the opinion of the SEC, that indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

Item 15. Recent Sales of Unregistered Securities.

On May 16, 2019, the Company issued warrants (the “Mann Warrants”) exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The Mann Warrants were issued pursuant to a Share Exchange Agreement with the seven owners of Mann-India Technologies Private Ltd., an Indian corporation (“Mann”), under which the Company acquired 100% of the shares of Mann and assumed certain net liabilities. The Mann Warrants were immediately exercisable to purchase 100,771 shares of the Company’s common stock and exercisable to purchase 859,951 shares of common stock one-year after the date of issuance (which was extended to March 31, 2021) and 368,550 shares of common stock two years after the date of issuance. All of the recipients of these warrants are residents of India. To the extent United States securities laws were deemed to apply to the issuance of such warrants, each of these sales of securities was consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended, and all of such recipients are sophisticated in business and investment matters.

On October 19, 2020, the Company granted options for 1,750,000 shares of common stock under the Company’s stock option plan to Ajay Sikka, the chief executive officer of the company, at an option price of $0.055 without registration under the Securities Act, and 2,180,000 options at a strike price of $0.055 to other directors in the United States as well as employees in India. Each of these sales of securities to persons in the United States was consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended. Mr. Sikka and the company’s directors are sophisticated in business and investment matters. To the extent United States securities laws were deemed to apply to the issuance of such options to employees in India, each of these sales of securities was also consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended, and all of such recipients are sophisticated in business and investment matters.

On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the principal amount of $125,000. The GS Note has a maturity date of one-year from issuance and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000. The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon repayment of the GS Note in accordance with its terms. These securities were issued as a private offering and sale pursuant to the exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended. The Company determined that GS Capital Partners, LLC was sophisticated in business and investment matters.

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On January 22, 2021, the Company issued 4,292,220 shares of common stock to the owners of Rohuma, LLC, a Delaware limited liability company (“Rohuma”), pursuant to a Share Exchange Agreement between the Company, Rohuma and the owners of Rohuma. Under the Share Exchange Agreement, the 10 Rohuma owners transferred to the Company all of their respective membership interests in Rohuma in exchange for the stock issued by the Company. Each of these sales of securities to the three purchasers located in the United States was consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended. These United States based grantees are sophisticated in business and investment matters. To the extent United States securities laws were deemed to apply to the issuance of such shares to the owners in India, each of these sales of securities was also consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended, and all of such owners are sophisticated in business and investment matters.

On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”) in the principal amount of $400,000. The Platinum Note has a maturity date of one-year from issuance. The Platinum Note is convertible into common stock at a conversion price of greater of (a) $0.01 or (b) 70% of the lowest traded stock price over the previous 15 trading days. The Company granted 200,000 warrants to purchase shares of common stock that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. These securities were issued as a private offering and sale pursuant to the exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended. The Company determined that Platinum Point Capital, LLC was sophisticated in business and investment matters.

On February 16, 2021, the Company sold 570,000 shares of its common stock to six persons for cash at a price of $0.80 per share. The individuals also received 285,000 warrants that have a term of three years at an exercise price of $2.00 per share. These sales of securities were consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended. The Company determined that all of these purchasers were sophisticated in business and investment matters.

On February 17, 2021, the Company issued warrants (the “Mimo Warrants”) to purchase 1,367,539 shares of the Company’s common stock over a period of 5 years, at an exercise price of $0.001 per share, subject to certain conditions. The Warrants were issued pursuant to a Share Exchange Agreement with Mimo Technologies Private Ltd., an Indian corporation (“Mimo”) and its shareholders whereby two of the Mimo shareholders received the Warrants in exchange for all of their respective shares in Mimo and the other Mimo shareholder received cash. Both of the recipients of these warrants are residents of India. To the extent United States securities laws were deemed to apply to the issuance of such warrants, each of these sales of securities was consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended, as both of such recipients are sophisticated in business and investment matters.

On February 23, 2021, the Company entered into a services agreement with another company with a portion of the compensation consisting of the issuance of 37,500 shares of common stock valued at $1.40 per share. This issuance of securities was consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended. The Company determined that this other company was sophisticated in business and investment matters.

On March 5, 2021, the Company exchanged outstanding debt securities of the Company with unpaid principal and interest in the amount of $224,687 for 264,338 shares of its common stock. These transactions were with a director of the Company and three other individuals who are related to the Company’s chief executive officer. These sales of securities were consummated pursuant to the exemption from registration in Section 3(a)(9) of the Securities Act of 1933, as amended, because it was exclusively with existing security holders of the Company and no commission or other remuneration was given or paid, directly or indirectly, for soliciting such exchange. The sales were also exempt under Section 4(a)(2) of the Securities Act of 1933, as amended, as all of these purchasers were sophisticated in business and investment matters.

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On March 1, 2021, the Company entered into consulting agreements with three individuals with a portion of the compensation consisting of the issuance of 61,500 shares of common stock valued at $1.15 per share at the commencement of the agreements. These sales of securities were consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended. The Company determined that these consultants were sophisticated in business and investment matters.

On March 8, 2021, the Company entered into a consulting agreement with another individual with a portion of the compensation consisting of the issuance of 25,000 shares of common stock valued at $0.80 per share at the commencement of the agreement and issuance of a three-year warrant for 100,000 warrants with a strike price of $2.00 per share that vests March 7, 2022. These sales of securities were consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended. The Company determined that this consultant was sophisticated in business and investment matters.

On April 5, 2021 the Company granted options for 250,000 shares of common stock under the Company’s stock option plan to Richard Berman, one of the Company’s directors, at an option price of $0.0055 without registration under the Securities Act. The options vest over three years. This sale of securities was consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended. Mr. Berman is sophisticated in business and investment matters.

On April 29, 2021, the Company sold 35,000 shares of its common stock to a single individual for cash at a price of $1.10 per share. This sale of securities was consummated pursuant to the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended. The Company determined that this purchaser was sophisticated in business and investment matters.

On June 15, 2021, the Company issued (1) its 2021 Promissory Note (the “Note”) to Greg Rankich, a director of the Company, in connection with a $400,000 loan to the Company from Mr. Rankich, and (2) 300,000 shares of its Common Stock, par value $0.0001 per share, to Mr. Rankich, which were valued at $1.00 per share.. In addition, Mr. Rankich granted to the Company an option to redeem up to 150,000 of such shares (as adjusted for stock splits, stock dividends or similar events) at a total cost of $1.00 if the Note is repaid in full (including accrued and unpaid interest) on or prior to its maturity date (without extension). The Note, which does not bear interest, matures and payment of the principal sum is required on or before 180 days after the date of the Note, subject to certain events of default that could result in acceleration of the maturity. The Note may be prepaid by the Company in whole or in part at any time prior to the maturity date without penalty or premium. These securities were issued as a private offering and sale pursuant to the exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended. Mr. Rankich is a director of the Company and was the only recipient of securities in this transaction. Rankich represented in connection with the transaction that he has such knowledge and experience in business and financial matters as to be capable of evaluating the merits and risks of the investment in the securities, is able to bear the economic risk of such investment and, at the present time, would be able to afford a complete loss of such investment. Resale of the securities is restricted, and a legend was applied to the share certificates prohibiting sale or transfer without an effective registration statement or an applicable exemption from registration.

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On September 17, 2021, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) pursuant to which Evergreen Capital Management, LLC (the “Purchaser”) agreed to purchase at a discount for an aggregate subscription price of $1,200,000 an aggregate of $1,440,000 in principal amount of promissory notes (“Notes”) and Common Stock Purchase Warrants (“Warrants”) for a total of 993,103 shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”) in three (3) tranches. Pursuant to the Purchase Agreement, (1) the first tranche of $600,000 in subscription amount of Notes (to purchase an aggregate of $720,000 in principal amount of Notes) and Warrants to purchase an aggregate of 496,552 shares of Common Stock was closed upon execution of the Purchase Agreement, (2) the second tranche of $400,000 in subscription amount of Notes (to purchase an aggregate of $480,000 in principal amount of Notes) and Warrants to purchase an aggregate of 331,034 shares of Common Stock will occur within three business days after the filing by the Company of a Registration Statement on Form S-1 (the “Registration Statement”) for the sale of Common Stock that will be listed on a national securities exchange, and (3) the third tranche of $200,000 in subscription amount of Notes (to purchase an aggregate of $240,000 in principal amount of Notes) and Warrants to purchase an aggregate of 165,517 shares of Common Stock will occur, at the option of the Purchaser, which the Purchaser may exercise in its sole discretion, three business days after the receipt by the Company and delivery to the Purchaser of the first comment letter of the Staff of the Securities and Exchange Commission (the “Commission”) relating to the Registration Statement or a letter from the Staff of the Commission to the effect that the Registration Statement will not be reviewed by the Staff of the Commission. In connection with the transactions under the Purchase Agreement, the Company entered into an amendment to its existing Engagement Letter with ThinkEquity, LLC (the “Placement Agent”) pursuant to which the Company agreed to issue to the Placement Agent warrants to purchase Common Stock equal to 8% of the shares of Common Stock issued or underlying the Warrants issued under the Purchase Agreement. These warrants (the “Placement Agent Warrants”) are to have the same terms and conditions, including exercise price and registration rights, as the Warrants issued pursuant to the Purchase Agreement. Each Note, each Warrant, each Placement Agent Warrant and any shares of Common Stock issuable upon conversion of a Note or exercise of a Warrant or Placement Agent Warrant was or will be issued in a transaction exempt from registration under the Securities Act of 1933, as amended, in reliance on Section 4(a)(2) thereof and Rule 506 of Regulation D thereunder. The Purchaser and the Placement Agent have each represented that it is an “accredited investor,” as defined in Regulation D, and has acquired and will be acquiring the securities described herein for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof. Resale of the securities is restricted, and a legend appears on the Notes, the Warrants and the Placement Agent Warrants prohibiting sale or transfer without an effective registration statement or an applicable exemption from registration. Accordingly, sale of the Notes, the Warrants and the Placement Agent Warrants and the issuance of shares of Common Stock upon conversion of the Notes or exercise of the Warrants and the Placement Agent Warrants have not been registered under the Securities Act of 1933, as amended.

Item 16. Exhibits and Financial Statement Schedules.

The following exhibits are filed with this Registration Statement:

1	Form of Underwriting Agreement*
3.1	Articles of Incorporation of TraQiQ, Inc., as amended, incorporated by reference to Exhibit 3.1 to the Annual Report on Form 10-K filed March 22, 2021.
3.2	Bylaws of TraQiQ, Inc., incorporated by reference to Exhibit 3.2 to the Registration Statement on Form S-1 filed March 7, 2011.
4.1	Note Purchase Agreement and Note, dated July 19, 2017 between the Company and Donald P. Hateley, incorporated by reference to Exhibit 4.1(a) to the Current Report on Form 8-K/A filed August 24, 2017.
4.2	Note Purchase Agreement and Note, dated July 19, 2017 between the Company and Alena Borisova, incorporated by reference to Exhibit 4.1(b) to the Current Report on Form 8-K/A filed August 24, 2017.
4.3	Certificate of Determination for Series A Preferred, incorporated by reference to Exhibit 4.2(a) to the Current Report on Form 8-K/A filed August 3, 2017.
4.4	Form of Representative’s Warrant Agreement.*
5	Opinion and consent of Hoge Fenton Jones & Appel, Inc. regarding legality of the securities being registered.*
10.1	Share Exchange Agreement dated July 19, 2017, fully executed on August 3, 2017, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K/A filed August 24, 2017.
10.2	TraQiQ, Inc. 2020 Equity Incentive Plan, incorporated by reference to Exhibit 10.2 to the Annual Report on Form 10-K filed March 22, 2021.

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10.3	Employment Agreement dated October 19, 2020 between TraQiQ, Inc. and Ajay Sikka.
10.4	Note Purchase Agreement and Note, dated June 15, 2021 between the Company and Greg Rankich, incorporated by reference to Exhibits 10.1 and 10.2, respectively, to the Current Report on Form 8-K filed June 16, 2021.
10.5	Share Exchange Agreement dated January 22, 2021, between TraQiQ, Inc. and Rohuma, LLC incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K/A filed January 26, 2021.
10.6	Exchange Agreement dated February 17, 2021, between TraQiQ, Inc. and Mimo-Technologies Pvt. Ltd, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed February 17, 2021.
10.7	12% Convertible Promissory Note dated January 19, 2021 to GS Capital Partners, LLC.
10.8	10% Convertible Promissory Note dated February 12, 2021 to Platinum Point Capital, LLC.
10.9	Securities Purchase Agreement dated September 17, 2021, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed September 20, 2021.
10.10	20% Convertible Promissory Note dated September 17, 2021 to Evergreen Capital Management, LLC, incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed September 20, 2021.
10.11	Common Stock Purchase Warrant dated September 17, 2021, incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed September 20, 2021.
10.12	Security Agreement dated September 17, 2021, incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed September 20, 2021.
21	Subsidiaries of TraQiQ, Inc., incorporated by reference to Exhibit 21 to the Annual Report on Form 10-K filed March 22, 2021.
23.1	Consent of AJSH & Co. LLP.
23.2	Consent of Hoge Fenton Jones & Appel, Inc. (included in Exhibit 5).*
24	Powers of Attorney (filed as part of the signature page to the Registration Statement).

* To be filed by amendment.

Item 17. Undertakings.

The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

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(ii)

To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

(iii)

To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

(2)	That for the purpose of determining any liability under the Securities Act of 1933 each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3)	To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(4)	That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
(5)	That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:

The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i)	Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
(ii)	Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii)	The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

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(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

(6)	The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.
(7)	Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the provisions described in Item 14 above, or otherwise, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
(8)	The undersigned Registrant hereby undertakes:

(i)

That for purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4), or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

(ii)

That for the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and this offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-8 

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Bellevue, State of Washington, on October 4, 2021.

TRAQIQ, INC.
By:	/s/ Ajay Sikka
	Ajay Sikka
	Chairman of the Board of Directors & Chief
	Executive Officer
	(Principal Executive Officer)

POWER OF ATTORNEY: KNOW ALL PERSONS BY THESE PRESENTS that each individual whose signature appears below constitutes and appoints Ajay Sikka, his true and lawful attorney-in-fact and agents with full power of substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement, and to sign any registration statement for the same offering covered by the Registration Statement that is to be effective upon filing pursuant to Rule 462(b) promulgated under the Securities Act, and all post-effective amendments thereto, and to file the same, with all exhibits thereto and all documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or his, her or their substitute or substitutes, may lawfully do or cause to be done or by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below on the dates indicated by the following persons in the capacities indicated.

Signature	Title	Date
/s/ Ajay Sikka	Chairman of the Board of Directors,	October 4, 2021
Ajay Sikka	and Chief Executive Officer
	(Principal Executive Officer)
/s/ Michael Pollack	Interim Chief Financial Officer	October 4, 2021
Michael Pollack	(Principal Accounting and Financial Officer)
/s/ James DuBois	Director	October 4, 2021
James DuBois
/s/ Greg Rankich	Director	October 4, 2021
Greg Rankich
/s/ Richard Berman	Director	October 4, 2021
Richard Berman

II-9 

EX-10.7

Exhibit 10.7

THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN AND WILL NOT BE REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE “1933 ACT”)

US $125,000.00

TRAQIQ, INC.

12% CONVERTIBLE REDEEMABLE NOTE

DUE DECEMBER 28, 2021

FOR VALUE RECEIVED, TRAQIQ, INC. (the “Company”) promises to pay to the order of GS CAPITAL PARTNERS, LLC and its authorized successors and permitted assigns (“Holder”), the aggregate principal face amount of One Hundred Twenty-Five Thousand Dollars exactly (U.S. $125,000.00) on December 28, 2021 (“Maturity Date”) and to pay interest on the principal amount outstanding hereunder at the rate of 12% per annum commencing on December 28, 2020 (“Issuance Date”). This Note shall contain an original issue discount of $10,000.00 such that the purchase price is $115,000.00. The Company shall make 7 monthly payments of $20,000 each beginning on the fifth (5^th) monthly anniversary of the Note with the final payment to include any principal and interest remaining (if any). The interest will be paid to the Holder in whose name this Note is registered on the records of the Company regarding registration and transfers of this Note. The principal of, and interest on, this Note are payable at 30 Washington Street, Suite 5L, Brooklyn, NY 11201, initially, and if changed, last appearing on the records of the Company as designated in writing by the Holder hereof from time to time. The Company will pay each interest payment and the outstanding principal due upon this Note before or on the Maturity Date, less any amounts required by law to be deducted or withheld, to the Holder of this Note by check or wire transfer addressed to such Holder at the last address appearing on the records of the Company. The forwarding of such check or wire transfer shall constitute a payment of outstanding principal hereunder and shall satisfy and discharge the liability for principal on this Note to the extent of the sum represented by such check or wire transfer. Interest shall be payable in Common Stock (as defined below) pursuant to paragraph 4(b) herein.

This Note is subject to the following additional provisions:

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1. This Note is exchangeable for an equal aggregate principal amount of Notes of different authorized denominations, as requested by the Holder surrendering the same. No service charge will be made for such registration or transfer or exchange, except that Holder shall pay any tax or other governmental charges payable in connection therewith.

2. The Company shall be entitled to withhold from all payments any amounts required to be withheld under applicable laws.

3. This Note may be transferred or exchanged only in compliance with the Securities Act of 1933, as amended (“Act”) and applicable state securities laws. Any attempted transfer to a non-qualifying party shall be treated by the Company as void. Prior to due presentment for transfer of this Note, the Company and any agent of the Company may treat the person in whose name this Note is duly registered on the Company’s records as the owner hereof for all other purposes, whether or not this Note be overdue, and neither the Company nor any such agent shall be affected or bound by notice to the contrary. Any Holder of this Note electing to exercise the right of conversion set forth in Section 4(a) hereof, in addition to the requirements set forth in Section 4(a), and any prospective transferee of this Note, also is required to give the Company written confirmation that this Note is being converted (“Notice of Conversion”) in the form annexed hereto as Exhibit A. The date of receipt (including receipt by telecopy) of such Notice of Conversion shall be the Conversion Date.

4. (a) In an event of a payment default, which consists of the Company failing to make each of the seven monthly payments set forth on page 1, then the Holder of this Note is entitled, at its option, at any time after cash payment, to convert all or any amount of the principal face amount of this Note then outstanding into shares of the Company’s common stock (the “Common Stock”) at a price (“Conversion Price”) for each share of Common Stock equal to 66% of the lowest closing price of the Common Stock as reported on the National Quotations Bureau OTC Marketplace exchange which the Company’s shares are traded or any exchange upon which the Common Stock may be traded in the future (“Exchange”), for the twenty prior trading days including the day upon which a Notice of Conversion is received by the Company or its transfer agent (provided such Notice of Conversion is delivered by fax or other electronic method of communication to the Company or its transfer agent after 4 P.M. Eastern Standard or Daylight Savings Time if the Holder wishes to include the same day closing price). If the shares have not been delivered within 3 business days, the Notice of Conversion may be rescinded. Such conversion shall be effectuated by the Company delivering the shares of Common Stock to the Holder within 3 business days of receipt by the Company of the Notice of Conversion. Accrued but unpaid interest shall be subject to conversion. No fractional shares or scrip representing fractions of shares will be issued on conversion, but the number of shares issuable shall be rounded to the nearest whole share. To the extent the Conversion Price of the Company’s Common Stock closes below the par value per share, the Company will take all steps necessary to solicit the consent of the stockholders to reduce the par value to the lowest value possible under law. The Company agrees to honor all conversions submitted pending this increase. In the event the Company experiences a DTC “Chill” on its shares, the Conversion Price shall be decreased to 56% instead of 66% while that “Chill” is in effect. In no event shall the Holder be allowed to effect a conversion if such conversion, along with all other shares of Company Common Stock beneficially owned by the Holder and its affiliates would exceed 4.99% of the outstanding shares of the Common Stock of the Company (which may be increased up to 9.9% upon 60 days’ prior written notice by the Investor). The conversion discount, look back period and other terms will be adjusted on a ratchet basis if the Company offers a more favorable conversion discount, interest rate, (whether through a straight discount or in combination with an original issue discount), look back period or other more favorable term to another party for any financings while this Note is in effect.

2

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(b) Interest on any unpaid principal balance of this Note shall be paid at the rate of 12% per annum. Interest shall be paid by the Company in Common Stock (“Interest Shares”). Holder may, at any time, send in a Notice of Conversion to the Company for Interest Shares based on the formula provided in Section 4(a) above. The dollar amount converted into Interest Shares shall be all or a portion of the accrued interest calculated on the unpaid principal balance of this Note to the date of such notice.

(c) The Notes may be prepaid without penalty, provided that an Event of Default has not occurred.

(d) Upon (i) a transfer of all or substantially all of the assets of the Company to any person in a single transaction or series of related transactions, (ii) a reclassification, capital reorganization or other change or exchange of outstanding shares of the Common Stock, other than a forward or reverse stock split or stock dividend, or (iii) any consolidation or merger of the Company with or into another person or entity in which the Company is not the surviving entity (other than a merger which is effected solely to change the jurisdiction of incorporation of the Company and results in a reclassification, conversion or exchange of outstanding shares of Common Stock solely into shares of Common Stock) (each of items (i), (ii) and (iii) being referred to as a “Sale Event”), then, in each case, the Company shall, upon request of the Holder, redeem this Note in cash for 150% of the principal amount, plus accrued but unpaid interest through the date of redemption, or at the election of the Holder, such Holder may convert the unpaid principal amount of this Note (together with the amount of accrued but unpaid interest) into shares of Common Stock immediately prior to such Sale Event at the Conversion Price.

(e) In case of any Sale Event (not to include a sale of all or substantially all of the Company’s assets) in connection with which this Note is not redeemed or converted, the Company shall cause effective provision to be made so that the Holder of this Note shall have the right thereafter, by converting this Note, to purchase or convert this Note into the kind and number of shares of stock or other securities or property (including cash) receivable upon such reclassification, capital reorganization or other change, consolidation or merger by a holder of the number of shares of Common Stock that could have been purchased upon exercise of the Note and at the same Conversion Price, as defined in this Note, immediately prior to such Sale Event. The foregoing provisions shall similarly apply to successive Sale Events. If the consideration received by the holders of Common Stock is other than cash, the value shall be as determined by the Board of Directors of the Company or successor person or entity acting in good faith.

5. No provision of this Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this Note at the time, place, and rate, and in the form, herein prescribed.

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6. The Company hereby expressly waives demand and presentment for payment, notice of non-payment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily liable for the payment of all sums owing and to be owing hereto.

7. The Company agrees to pay all costs and expenses, including reasonable attorneys’ fees and expenses, which may be incurred by the Holder in collecting any amount due under this Note.

8. If one or more of the following described “Events of Default” shall occur:

(a) The Company shall default in the payment of principal or interest on this Note or any other note issued to the Holder by the Company; or

(b) Any of the representations or warranties made by the Company herein or in any certificate or financial or other written statements heretofore or hereafter furnished by or on behalf of the Company in connection with the execution and delivery of this Note, or the Securities Purchase Agreement under which this note was issued shall be false or misleading in any respect; or

(c) The Company shall fail to perform or observe, in any respect, any covenant, term, provision, condition, agreement or obligation of the Company under this Note or any other note issued to the Holder; or

(d) The Company shall (1) become insolvent; (2) admit in writing its inability to pay its debts generally as they mature; (3) make an assignment for the benefit of creditors or commence proceedings for its dissolution; (4) apply for or consent to the appointment of a trustee, liquidator or receiver for its or for a substantial part of its property or business; (5) file a petition for bankruptcy relief, consent to the filing of such petition or have filed against it an involuntary petition for bankruptcy relief, all under federal or state laws as applicable; or

(e) A trustee, liquidator or receiver shall be appointed for the Company or for a substantial part of its property or business without its consent and shall not be discharged within sixty (60) days after such appointment; or

(f) Any governmental agency or any court of competent jurisdiction at the instance of any governmental agency shall assume custody or control of the whole or any substantial portion of the properties or assets of the Company; or

(g) One or more money judgments, writs or warrants of attachment, or similar process, in excess of fifty thousand dollars ($50,000) in the aggregate, shall be entered or filed against the Company or any of its properties or other assets and shall remain unpaid, unvacated, unbonded or unstayed for a period of fifteen (15) days or in any event later than five (5) days prior to the date of any proposed sale thereunder; or

(h) The Company shall have defaulted on or breached any term of any other note of similar debt instrument into which the Company has entered and failed to cure such default within the appropriate grace period; or

4

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(i) The Company shall have its Common Stock delisted from an exchange (including the OTC Market exchange) or, if the Common Stock trades on an exchange, then trading in the Common Stock shall be suspended for more than 10 consecutive days or ceases to file its 1934 act reports with the SEC;

(j) If a majority of the members of the Board of Directors of the Company on the date hereof are no longer serving as members of the Board;

(k) The Company shall not deliver to the Holder the Common Stock pursuant to paragraph 4 herein without restrictive legend within 3 business days of its receipt of a Notice of Conversion; or

(l) The Company shall not replenish the reserve set forth in Section 12, within 3 business days of the request of the Holder.

(m) The Company shall not be “current” in its filings with the Securities and Exchange Commission; or

(n) The Company shall lose the “bid” price for its stock and a market (including the OTC marketplace or other exchange)

Then, or at any time thereafter, unless cured within 5 days, and in each and every such case, unless such Event of Default shall have been waived in writing by the Holder (which waiver shall not be deemed to be a waiver of any subsequent default) at the option of the Holder and in the Holder’s sole discretion, the Holder may consider this Note immediately due and payable, without presentment, demand, protest or (further) notice of any kind (other than notice of acceleration), all of which are hereby expressly waived, anything herein or in any note or other instruments contained to the contrary notwithstanding, and the Holder may immediately, and without expiration of any period of grace, enforce any and all of the Holder’s rights and remedies provided herein or any other rights or remedies afforded by law. Upon an Event of Default, interest shall accrue at a default interest rate of 24% per annum or, if such rate is usurious or not permitted by current law, then at the highest rate of interest permitted by law. In the event of a breach of Section 8(k) the penalty shall be $250 per day the shares are not issued beginning on the 4^th day after the conversion notice was delivered to the Company. This penalty shall increase to $500 per day beginning on the 10^th day. The penalty for a breach of Section 8(n) shall be an increase of the outstanding principal amounts by 20%. In case of a breach of Section 8(i), the outstanding principal due under this Note shall increase by 50%. If this Note is not paid at maturity, the outstanding principal due under this Note shall increase by 15%. Further, if a breach of Section 8(m) occurs or is continuing after the 6 month anniversary of the Note, then the Holder shall be entitled to use the lowest closing bid price during the delinquency period as a base price for the conversion. For example, if the lowest closing bid price during the delinquency period is $0.01 per share and the conversion discount is 50% the Holder may elect to convert future conversions at $0.005 per share.

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If the Holder shall commence an action or proceeding to enforce any provisions of this Note, including, without limitation, engaging an attorney, then if the Holder prevails in such action, the Holder shall be reimbursed by the Company for its attorneys’ fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.

9. In case any provision of this Note is held by a court of competent jurisdiction to be excessive in scope or otherwise invalid or unenforceable, such provision shall be adjusted rather than voided, if possible, so that it is enforceable to the maximum extent possible, and the validity and enforceability of the remaining provisions of this Note will not in any way be affected or impaired thereby.

10. Neither this Note nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the Company and the Holder.

11. The Company represents that it is not a “shell” issuer and has never been a “shell” issuer or that if it previously has been a “shell” issuer that at least 12 months have passed since the Company has reported form 10 type information indicating it is no longer a “shell” issuer. Further. The Company will instruct its counsel to either (i) write a 144 opinion to allow for salability of the conversion shares or (ii) accept such opinion from Holder’s counsel.

12. The Company shall issue irrevocable transfer agent instructions reserving 1,010,001 shares of its Common Stock for conversions under this Note (the “Share Reserve”). Upon full conversion of this Note, any shares remaining in the Share Reserve shall be cancelled. The Company shall pay all transfer agent and legal opinion costs associated with issuing and delivering the share certificates to the Holder, as well as maintaining the Share Reserve. If such amounts are to be paid by the Holder, it may deduct such amounts from the principal amount being converted. The company should at all times reserve a minimum of four times the amount of shares required if the note would be fully converted. The Holder may reasonably request increases from time to time to reserve such amounts. The Company will instruct its transfer agent to provide the outstanding share information to the Holder in connection with its conversions.

13. The Company will give the Holder direct notice of any corporate actions, including but not limited to name changes, stock splits, recapitalizations etc. This notice shall be given to the Holder as soon as possible under law.

14. If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the applicable provision shall automatically be revised to equal the maximum rate of interest or other amount deemed interest permitted under applicable law. The Company covenants (to the extent that it may lawfully do so) that it will not seek to claim or take advantage of any law that would prohibit or forgive the Company from paying all or a portion of the principal or interest on this Note.

15. This Note shall be governed by and construed in accordance with the laws of New York applicable to contracts made and wholly to be performed within the State of New York and shall be binding upon the successors and assigns of each party hereto. The Holder and the Company hereby mutually waive trial by jury and consent to exclusive jurisdiction and venue in the courts of the State of New York or in the Federal courts sitting in the county or city of New York, or the Federal courts within the districts of New York. This Agreement may be executed in counterparts, and the facsimile transmission of an executed counterpart to this Agreement shall be effective as an original.

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IN WITNESS WHEREOF, the Company has caused this Note to be duly executed by an officer thereunto duly authorized.

Dated: January 19, 2021

TRAQIQ, INC.
By:	/s/ Ajay Sikka
	Ajay Sikka
Title:	CEO

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EXHIBIT A

NOTICE OF CONVERSION

(To be Executed by the Registered Holder in order to Convert the Note)

The undersigned hereby irrevocably elects to convert $___________ of the above Note into _________ Shares of Common Stock of TRAQIQ, INC. (“Shares”) according to the conditions set forth in such Note, as of the date written below.

If Shares are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer and other taxes and charges payable with respect thereto.

Date of Conversion: ________________________________________________________________

Applicable Conversion Price: _________________________________________________________

Signature:________________________________________________________________________

[Print Name of Holder and Title of Signer]

Address: ________________________________________________________________________

 ________________________________________________________________________

SSN or EIN: _________________________

Shares are to be registered in the following name: _________________________________________________

Name:______________________________________________________________

Address: ___________________________________________________________

Tel: _______________________________________

Fax: _______________________________________

SSN or EIN: _________________________________

Shares are to be sent or delivered to the following account:

Account Name: _______________________________________________________

Address: ____________________________________________________________

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EX-10.8

Exhibit 10.8

NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH MAY BE THE LEGAL COUNSEL OPINION (AS DEFINED IN THE PURCHASE AGREEMENT)), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144, RULE 144A, REGULATION S, OR OTHER APPLICABLE EXEMPTION UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

Principal Amount: $400,000.00	Issue Date: February 12, 2021
Actual Amount of Purchase Price: $400,000.00

CONVERTIBLE PROMISSORY NOTE

FOR VALUE RECEIVED, TRAQIQ, INC., a California corporation (hereinafter called the “Borrower”), hereby promises to pay to the order of PLATINUM POINT CAPITAL, LLC., a Nevada limited liability company, or registered assigns (the “Holder”), in the form of lawful money of the United States of America, the principal sum of up to $400,000.00 (the “Principal Amount”) (subject to adjustment herein), with a purchase price of $400,000.00 (the “Consideration”) and to pay interest on the Principal Amount under this Note at the rate of ten percent (10%) (the “Interest Rate”) per annum guaranteed from the date that the amount of Consideration is fully funded in accordance with the terms of this Note until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise, as further provided herein. The Holder shall pay $400,000.00 of the Consideration on the day of the full execution of the Note and all related transactional documents related to this Note, and the outstanding principal amount under this Note shall be $400,000.00. The maturity date for this Note shall be twelve (12) months from the effective date of the Holder’s payment of the Consideration (“Maturity Date”), and is the date upon which the principal sum as well as any accrued and unpaid interest and other fees shall be due and payable. Notwithstanding any other provision of this Note or any related transaction documents, Borrower may prepay this Note only pursuant to Section 1.9 hereof.

It is further acknowledged and agreed that the Principal Amount owed by Borrower under this Note shall be increased by the amount of all expenses up to a maximum of $500.00 incurred by the Holder relating to any conversion of this Note into shares of Common Stock. All such expenses shall be deemed added to the Principal Amount hereunder to the extent such expenses are paid by the Holder.

Interest shall commence accruing on the date that the Note is fully funded and shall be computed on the basis of a 365-day year and the actual number of days elapsed. Any Principal Amount or interest on this Note which is not paid when due shall bear interest at the rate the lesser of (a) twenty(20%) per annum from the due date thereof until the same is paid (“Default Interest”); or (b) the maximum rate allowed by law.

All payments due hereunder (to the extent not converted into shares of common stock of the Borrower (the “Common Stock”) in accordance with the terms hereof) shall be made in lawful money of the United States of America. All payments shall be made at such address as the Holder shall hereafter give to the Borrower by written notice made in accordance with the provisions of this Note. Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a business day, the same shall instead be due on the next succeeding day which is a business day and, in the case of any interest payment date which is not the date on which this Note is paid in full, the extension of the due date thereof shall not be taken into account for purposes of determining the amount of interest due on such date.

1

Each capitalized term used herein, and not otherwise defined, shall have the meaning ascribed thereto in that certain Securities Purchase Agreement, dated as of the Issue Date, pursuant to which this Note was originally issued (the “Purchase Agreement”). As used in this Note, the term “business day” shall mean any day other than a Saturday, Sunday or a day on which commercial banks in the city of New York, New York are authorized or required by law or executive order to remain closed. As used herein, the term “Trading Day” means any day that shares of Common Stock are listed for trading or quotation on the Principal Market (as defined in the Purchase Agreement), any tier of the NASDAQ Stock Market, the New York Stock Exchange or the NYSE American.

This Note is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.

The following terms shall apply to this Note:

ARTICLE I. CONVERSION RIGHTS

1.1 Conversion Right. Beginning on the day after payment of the Purchase Price hereof, the Holder shall have the right to convert all or any portion of the then outstanding and unpaid Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of Common Stock, as such Common Stock exists on the Issue Date, or any shares of capital stock or other securities of the Borrower into which such Common Stock shall hereafter be changed or reclassified, at the Conversion Price (as defined below) determined as provided herein (a “Conversion”); provided, however, that in no event shall the Holder be entitled to convert any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1) the number of shares of Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of this Note or the unexercised or unconverted portion of any other security of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number of Conversion Shares issuable upon the conversion of the portion of this Note with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates of more than 4.99% of the then outstanding shares of Common Stock (unless Investor is current in the requisite filings under the requisite securities laws, including but not limited to the filing of Schedule 13g). For purposes of the proviso set forth in the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso, provided, however, that the limitations on conversion may be waived (up to 9.99%) by the Holder upon, at the election of the Holder, not less than 61 days’ prior notice to the Borrower, and the provisions of the conversion limitation shall continue to apply until such 61st day (or such later date, as determined by the Holder, as may be specified in such notice of waiver). The number of Conversion Shares to be issued upon each conversion of this Note shall be determined by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect on the date specified in the notice of conversion, in the form attached hereto as Exhibit A (the “Notice of Conversion”), delivered to the Borrower or Borrower’s transfer agent by the Holder in accordance with Section 1.4 below; provided that the Notice of Conversion is submitted by facsimile or e-mail (or by other means resulting in, or reasonably expected to result in, notice) to the Borrower or Borrower’s transfer agent before 11:59 p.m., New York, New York time on such conversion date (the “Conversion Date”). The term “Conversion Amount” means, with respect to any conversion of this Note, the sum of (1) the Principal Amount of this Note to be converted in such conversion plus (2) at the Holder’s option, accrued and unpaid interest, if any, on such Principal Amount at the Interest Rate to the Conversion Date, plus (3) at the Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2).

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1.2 Conversion Price.

(a) Calculation of Conversion Price. The per share conversion price into which Principal Amount and interest (including any Default Interest) under this Note shall be convertible into shares of Common Stock hereunder at a price (the “Conversion Price”) be equal to the greater of (i) $0.01 per share (the “Fixed Conversion Price”), or (ii) seventy percent (70%) of the lowest traded price over the fifteen (15) consecutive trading day period ending on the trading day immediately prior to the applicable conversion date (the “Variable Conversion Price”); provided, however, that the maximum Conversion Price shall not exceed $1.00 per share. To the extent the Conversion Price is below the par value per share, the Borrower will take all steps necessary to solicit the consent of the stockholders to reduce the par value to the lowest value possible under law, provided however that the Borrower agrees to honor all conversions submitted pending this increase. If at any time the Conversion Price as determined hereunder for any conversion would be less than the par value of the Common Stock, then at the sole discretion of the Holder, the Conversion Price hereunder may equal such par value for such conversion and the Conversion Amount for such conversion may be increased to include Additional Principal, where “Additional Principal” means such additional amount to be added to the Conversion Amount to the extent necessary to cause the number of conversion shares issuable upon such conversion to equal the same number of conversion shares as would have been issued had the Conversion Price not been adjusted by the Holder to the par value price. In the event the Borrower has a DTC “Chill” on its shares, an additional discount of ten percent (10%) shall apply to the Conversion Price while that “Chill” is in effect.

(b) Conversion Price During Major Announcements. Notwithstanding anything contained in Section 1.2(a) to the contrary, in the event the Borrower (i) makes a public announcement that it intends to be acquired by, consolidate or merge with any other corporation or entity (other than a merger in which the Borrower is the surviving or continuing corporation and its capital stock is unchanged) or sell or transfer all or substantially all of the assets of the Borrower; or (ii) any person, group or entity (including the Borrower) publicly announces a tender offer to purchase fifty percent (50%) or more of the Common Stock (or any other takeover scheme) (any such transaction referred to in clause (i) or (ii) being referred to herein as a “Change in Control” and the date of the announcement referred to in clause (i) or (ii) is being referred to herein as the “Announcement Date”), then the Conversion Price shall be equal to the Default Conversion Price.

1.3 Authorized and Reserved Shares. The Borrower covenants that at all times until the Note is satisfied in full, the Borrower will reserve from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the issuance of a number of Conversion Shares equal to the greater of: (a) 10,000,000 shares of Common Stock or (b) the sum of (i) the number of Conversion Shares issuable upon the full conversion of this Note (assuming no payment of Principal Amount or interest) as of any issue date (taking into consideration any adjustments to the Conversion Price pursuant to Section 2 hereof or otherwise) multiplied by (ii) 10(10) (the “Reserved Amount”). In the event that the Borrower shall be unable to reserve the entirety of the Reserved Amount (the “Reserve Amount Failure”), the Borrower shall promptly take all actions necessary to increase its authorized share capital to accommodate the Reserved Amount (the “Authorized Share Increase”), including without limitation, all board of directors actions and approvals and promptly (but no less than sixty (60) days following the calling and holding a special meeting of its shareholders no more than sixty (60) days following the Reserve Amount Failure to seek approval of the Authorized Share Increase via the solicitation of proxies. Notwithstanding the foregoing, in no event shall the Reserved Amount be lower than the initial Reserved Amount, regardless of any prior conversions. The Borrower represents that upon issuance, the Conversion Shares will be duly and validly issued, fully paid and non- assessable. In addition, if the Borrower shall issue any securities or make any change to its capital structure which would change the number of Conversion Shares into which this Note shall be convertible at the then current Conversion Price, the Borrower shall at the same time make proper provision so that thereafter there shall be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of this Note. The Borrower (i) acknowledges that it has irrevocably instructed its transfer agent to issue certificates for the Conversion Shares or instructions to have the Conversion Shares issued as contemplated by Section 1.4(f) hereof, and (ii) agrees that its issuance of this Note shall constitute full authority to its officers and agents who are charged with the duty of executing stock certificates or cause the Borrower to electronically issue shares of Common Stock to execute and issue the necessary certificates for the Conversion Shares or cause the Conversion Shares to be issued as contemplated by Section 1.4(f) hereof in accordance with the terms and conditions of this Note.

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If, at any time the Borrower does not maintain the Reserved Amount it will be considered an Event of Default under this Note.

1.4 Method of Conversion.

(a) Mechanics of Conversion. This Note may be converted by the Holder in whole or in part, on any Trading Day, while any amounts are outstanding hereunder, by submitting to the Borrower or Borrower’s transfer agent a Notice of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 11:59 p.m., New York, New York time). Any Notice of Conversion submitted after 11:59 p.m., New York, New York time, shall be deemed to have been delivered and received on the next Trading Day.

(b) Surrender of Note Upon Conversion. Notwithstanding anything to the contrary set forth herein, upon conversion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Borrower unless the entire unpaid Principal Amount is so converted. The Holder and the Borrower shall maintain records showing the Principal Amount so converted and the dates of such conversions or shall use such other method, reasonably satisfactory to the Holder and the Borrower, so as not to require physical surrender of this Note upon each such conversion. In the event of any dispute or discrepancy, such records of the Borrower shall, prima facie, be controlling and determinative in the absence of manifest error. Notwithstanding the foregoing, if any portion of this Note is converted as aforesaid, the Holder may not transfer this Note unless the Holder first physically surrenders this Note to the Borrower, whereupon the Borrower will forthwith issue and deliver upon the order of the Holder a new Note of like tenor, registered as the Holder (upon payment by the Holder of any applicable transfer taxes) may request, representing in the aggregate the remaining unpaid Principal Amount of this Note. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of a portion of this Note, the unpaid and unconverted Principal Amount of this Note represented by this Note may be less than the amount stated on the face hereof.

(c) Payment of Taxes. The Borrower shall not be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares of Common Stock or other securities or property on conversion of this Note in a name other than that of the Holder (or in street name), and the Borrower shall not be required to issue or deliver any such shares or other securities or property unless and until the person or persons (other than the Holder or the custodian in whose street name such shares are to be held for the Holder’s account) requesting the issuance thereof shall have paid to the Borrower the amount of any such tax or shall have established to the satisfaction of the Borrower that such tax has been paid.

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(d) Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail (or other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in this Section 1.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder certificates for the Conversion Shares (or cause the electronic delivery of the Conversion Shares as contemplated by Section 1.4(f) hereof) within three (3) Trading Days after such receipt (the “Deadline”) (and, solely in the case of conversion of the entire unpaid Principal Amount and interest (including any Default Interest) under this Note, surrender of this Note). If the Borrower shall fail for any reason or for no reason to issue to the Holder on or prior to the Deadline a certificate or book entry statement confirming the issuance for the number of Conversion Shares or to which the Holder is entitled hereunder, and register such Conversion Shares on the Borrower’s share register or to credit the Holder’s balance account with DTC (as defined below) for such number of Conversion Shares to which the Holder is entitled upon the Holder’s conversion of this Note (a “Conversion Failure”), then, in addition to all other remedies available to the Holder, (i) the Borrower shall pay in cash to the Holder on each day after the Deadline and during such Conversion Failure an amount equal to two percent (2.0%) of the product of (A) the sum of the number of Conversion Shares not issued to the Holder on or prior to the Deadline and to which the Holder is entitled and (B) the closing sale price of the Common Stock on the Trading Day immediately preceding the last possible date which the Borrower could have issued such Conversion Shares to the Holder without violating this Section 1.4(d); and (ii) the Holder, upon written notice to the Borrower, may void its Notice of Conversion with respect to, and retain or have returned, as the case may be, any portion of this Note that has not been converted pursuant to such Notice of Conversion; provided that the voiding of an Notice of Conversion shall not affect the Borrower’s obligations to make any payments which have accrued prior to the date of such notice. In addition to the foregoing, if on or prior to the Deadline the Borrower shall fail to issue and deliver a certificate to the Holder and register such Conversion Shares on the Borrower’s share register or credit the Holder’s balance account with DTC for the number of Conversion Shares to which the Holder is entitled upon the Holder’s exercise hereunder or pursuant to the Borrower’s obligation pursuant to clause (ii) below, and if on or after such Trading Day the Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of shares of Common Stock issuable upon such exercise that the Holder anticipated receiving from the Borrower, then the Borrower shall, within two (2) Trading Days after the Holder’s request and in the Holder’s discretion, either (i) pay cash to the Holder in an amount equal to the Holder’s total purchase price (including brokerage commissions and other reasonable and customary out-of-pocket expenses, if any) for the shares of Common Stock so purchased (the “Buy-In Price”), at which point the Borrower’s obligation to deliver such certificate (and to issue such Conversion Shares) or credit such Holder’s balance account with DTC for such Conversion Shares shall terminate, or (ii) promptly honor its obligation to deliver to the Holder a certificate or certificates representing such Conversion Shares or credit such Holder’s balance account with DTC and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (A) such number of shares of Common Stock, times (B) the closing sales price of the Common Stock on the date of exercise. Nothing shall limit the Holder’s right to pursue any other remedies available to it hereunder, at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Borrower’s failure to timely deliver certificates representing the Conversion Shares (or to electronically deliver such Conversion Shares) upon the conversion of this Note as required pursuant to the terms hereof.

(e) Obligation of Borrower to Deliver Common Stock. At the time that the Holder submits the Notice of Conversion to the Borrower or Borrower’s transfer agent, the Holder shall be deemed to be the holder of record of the Conversion Shares issuable upon such conversion, the outstanding Principal Amount and the amount of accrued and unpaid interest (including any Default Interest) under this Note shall be reduced to reflect such conversion, and, unless the Borrower defaults on its obligations under this Article I, all rights with respect to the portion of this Note being so converted shall forthwith terminate except the right to receive the Common Stock or other securities, cash or other assets, as herein provided, on such conversion. If the Holder shall have given a Notice of Conversion as provided herein, the Borrower’s obligation to issue and deliver the certificates for the Conversion Shares (or cause the electronic delivery of the Conversion Shares as contemplated by Section 1.4(f) hereof) shall be absolute and unconditional, irrespective of the absence of any action by the Holder to enforce the same, any waiver or consent with respect to any provision thereof, the recovery of any judgment against any person or any action to enforce the same, any failure or delay in the enforcement of any other obligation of the Borrower to the holder of record, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder of any obligation to the Borrower, and irrespective of any other circumstance which might otherwise limit such obligation of the Borrower to the Holder in connection with such conversion. The Conversion Date specified in the Notice of Conversion shall be the Conversion Date so long as the Notice of Conversion is sent to the Borrower or Borrower’s transfer agent before 11:59 p.m., New York, New York time, on such date.

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(f) Delivery of Conversion Shares by Electronic Transfer. In lieu of delivering physical certificates representing the Conversion Shares issuable upon conversion hereof, provided the Borrower is participating in the Depository Trust Borrower (“DTC”) Fast Automated Securities Transfer or Deposit/Withdrawal at Custodian programs, upon request of the Holder and its compliance with the provisions contained in Section 1.1 and in this Section 1.4, the Borrower shall use its reasonable best efforts to cause its transfer agent to electronically transmit the Conversion Shares issuable upon conversion hereof to the Holder by crediting the account of Holder’s Prime Broker with DTC through its Deposit Withdrawal Agent Commission system.

1.5 Concerning the Shares. The Conversion Shares issuable upon conversion of this Note may not be sold or transferred unless (i) such shares are sold pursuant to an effective registration statement under the 1933 Act; or (ii) the Borrower or its transfer agent shall have been furnished with an opinion of counsel (which opinion shall be the Legal Counsel Opinion (as defined in the Purchase Agreement)) to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration; or (iii) such shares are sold or transferred pursuant to Rule 144, Rule 144A, Regulation S, or other applicable exemption; or (iv) such shares are transferred to an “affiliate” (as defined in Rule 144) of the Borrower who agrees to sell or otherwise transfer the shares only in accordance with this Section 1.5 and who is an Accredited Investor (as defined in the Purchase Agreement). Except as otherwise provided in the Purchase Agreement (and subject to the removal provisions set forth below), until such time as the Conversion Shares have been registered under the 1933 Act or otherwise may be sold pursuant to Rule 144, Rule 144A, Regulation S, or other applicable exemption without any restriction as to the number of securities as of a particular date that can then be immediately sold, each certificate for the Conversion Shares that has not been so included in an effective registration statement or that has not been sold pursuant to an effective registration statement or an exemption that permits removal of the legend, shall bear a legend substantially in the following form, as appropriate:

“NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH MAY BE THE LEGAL COUNSEL OPINION (AS DEFINED IN THE PURCHASE AGREEMENT)), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144, RULE 144A, REGULATION S, OR OTHER APPLICABLE EXEMPTION UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”

The legend set forth above shall be removed and the Borrower shall issue to the Holder a certificate for the applicable Conversion Shares without such legend upon which it is stamped or (as requested by the Holder) issue the applicable Conversion Shares by electronic delivery by crediting the account of such holder’s broker with DTC, if, unless otherwise required by applicable state securities laws: (a) such Conversion Shares are registered for sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144, Rule 144A, Regulation S, or other applicable exemption without any restriction as to the number of securities as of a particular date that can then be immediately sold, or (b) the Borrower or the Holder provides the Legal Counsel Opinion (as contemplated by and in accordance with Section 4(m) of the Purchase Agreement) to the effect that a public sale or transfer of such Conversion Shares may be made without registration under the 1933 Act, which opinion shall be accepted by the Borrower so that the sale or transfer is effected. The Borrower shall be responsible for the fees of its transfer agent and all DTC fees associated with any such issuance. The Holder agrees to sell all Conversion Shares, including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any. In the event that the Borrower does not accept the opinion of counsel provided by the Holder with respect to the transfer of Conversion Shares pursuant to an exemption from registration, such as Rule 144, Rule 144A or Regulation S, at the Deadline, notwithstanding that the conditions of Rule 144, Rule 144A, Regulation S, or other applicable exemption, as applicable, have been met, it will be considered an Event of Default under this Note.

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1.6 Effect of Certain Events.

(a) Effect of Merger, Consolidation, Etc. At the option of the Holder, the sale, conveyance or disposition of all or substantially all of the assets of the Borrower, or the consolidation, merger or other business combination of the Borrower with or into any other Person (as defined below) or Persons when the Borrower is not the survivor shall either: (i) be deemed to be an Event of Default pursuant to which the Borrower shall be required to pay to the Holder upon the consummation of and as a condition to such transaction an amount equal to the Default Amount (defined in Section 3.24) or (ii) be treated pursuant to Section 1.6(b) hereof. “Person” shall mean any individual, corporation, limited liability Borrower, partnership, association, trust or other entity or organization.

(b) Adjustment Due to Merger, Consolidation, Etc. If, at any time when this Note is issued and outstanding and prior to conversion of all of this Note, there shall be any merger, consolidation, exchange of shares, recapitalization, reorganization, or other similar event, as a result of which shares of Common Stock of the Borrower shall be changed into the same or a different number of shares of another class or classes of stock or securities of the Borrower or another entity, or in case of any sale or conveyance of all or substantially all of the assets of the Borrower other than in connection with a plan of complete liquidation of the Borrower, then the Holder of this Note shall thereafter have the right to receive upon conversion of this Note, upon the basis and upon the terms and conditions specified herein and in lieu of the shares of Common Stock immediately theretofore issuable upon conversion, such stock, securities or assets which the Holder would have been entitled to receive in such transaction had this Note been converted in full immediately prior to such transaction (without regard to any limitations on conversion set forth herein), and in any such case appropriate provisions shall be made with respect to the rights and interests of the Holder of this Note to the end that the provisions hereof (including, without limitation, provisions for adjustment of the Conversion Price and of the number of shares issuable upon conversion of the Note) shall thereafter be applicable, as nearly as may be practicable in relation to any securities or assets thereafter deliverable upon the conversion hereof. The Borrower shall not effectuate any transaction described in this Section 1.6(b) unless (a) it first gives, to the extent practicable, at least thirty (30) days prior written notice (but in any event at least fifteen (15) days prior written notice) of the record date of the special meeting of shareholders to approve, or if there is no such record date, the consummation of, such merger, consolidation, exchange of shares, recapitalization, reorganization or other similar event or sale of assets (during which time the Holder shall be entitled to convert this Note) and (b) the resulting successor or acquiring entity (if not the Borrower) assumes by written instrument the obligations of this Section 1.6(b). The above provisions shall similarly apply to successive consolidations, mergers, sales, transfers or share exchanges.

(c) Adjustment Due to Distribution. If the Borrower shall declare or make any distribution of its assets (or rights to acquire its assets) to holders of Common Stock as a dividend, stock repurchase, by way of return of capital or otherwise (including any dividend or distribution to the Borrower’s shareholders in cash or shares (or rights to acquire shares) of capital stock of a subsidiary (i.e., a spin-off)) (a “Distribution”), then the Holder of this Note shall be entitled, upon any conversion of this Note after the date of record for determining shareholders entitled to such Distribution, to receive the amount of such assets which would have been payable to the Holder with respect to the shares of Common Stock issuable upon such conversion had such Holder been the holder of such shares of Common Stock on the record date for the determination of shareholders entitled to such Distribution.

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(d) Purchase Rights. If, at any time when all or any portion of this Note is issued and outstanding, the Borrower issues any convertible securities or rights to purchase stock, warrants, securities or other property (the “Purchase Rights”) pro rata to the record holders of any class of Common Stock, then the Holder of this Note will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such Holder could have acquired if such Holder had held the number of shares of Common Stock acquirable upon complete conversion of this Note (without regard to any limitations on conversion contained herein) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights or, if no such record is taken, the date as of which the record holders of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights.

(e) Dilutive Issuance. If the Borrower, at any time while this Note or any amounts due hereunder are outstanding, issues, sells or grants (or has issued, sold or granted as of the Issue Date, as the case may be) any option to purchase, or sells or grants any right to reprice, or otherwise disposes of, or issues (or has sold or issued, as the case may be, or announces any sale, grant or any option to purchase or other disposition), securities convertible into, exercisable for, or otherwise entitle any person or entity the right to acquire, shares of Common Stock (including, without limitation, upon conversion of this Note, and any convertible notes or warrants outstanding as of or following the Issue Date), in each or any case at an effective price per share that is lower than the then Conversion Price (such lower price, the “Base Conversion Price” and such issuances, collectively, a “Dilutive Issuance”) (it being agreed that if the holder of the Common Stock or other securities so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share which are issued in connection with such issuance, be entitled to receive shares of Common Stock at an effective price per share that is lower than the Conversion Price, such issuance shall be deemed to have occurred for less than the Conversion Price on such date of the Dilutive Issuance), then the Conversion Price shall be reduced, at the option of the Holder, to a price equal the Base Conversion Price. If the Borrower enters into a Variable Rate Transaction, despite the prohibition set forth in the Purchase Agreement, the Borrower shall be deemed to have issued Common Stock or Common Stock Equivalents at the lowest possible price per share at which such securities could be issued in connection with such Variable Rate Transaction. Such adjustment shall be made whenever such Common Stock or other securities are issued. Notwithstanding the foregoing, no adjustment will be made under this Section 1.6(e) in respect of an Exempt Issuance. In the event of an issuance of securities involving multiple tranches or closings, any adjustment pursuant to this Section 1.6(e) shall be calculated as if all such securities were issued at the initial closing. This Section shall also be subject to the mechanics of Section 1.6(g) “Pending Legislation” clause herein.

An “Exempt Issuance” shall mean the issuance of (a) shares of Common Stock or other securities to officers or directors of the Borrower pursuant to any stock or option or similar equity incentive plan duly adopted for such purpose, by a majority of the non-employee members of the Borrower’s Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose in a manner which is consistent with the Borrower’s prior business practices; (b) securities issued pursuant to a merger, consolidation, acquisition or similar business combination approved by a majority of the disinterested directors of the Borrower, provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating Borrower or an owner of an asset in a business synergistic with the business of the Borrower and shall provide to the Borrower additional benefits in addition to the investment of funds, but shall not include a transaction in which the Borrower is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities; (c) securities issued pursuant to any equipment loan or leasing arrangement, real property leasing arrangement or debt financing from a bank or similar financial institution approved by a majority of the disinterested directors of the Borrower; (d) securities issued under the Form 1-A or S-1 filed and declared effective by the Securities and Exchange Commission as of the date hereof; (e) existing convertible debt and equity lines of credit in existence on the date hereof, (f) private placements of Common Stock by the Borrower; and/or (g) securities issued with respect to which the Holder waives its rights in writing under this Section 1.6(e).

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(f) Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of the Conversion Price as a result of the events described in this Section 1.6, the Borrower, at its expense, shall promptly compute such adjustment or readjustment and prepare and furnish to the Holder a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Borrower shall, upon the written request at any time of the Holder, furnish to such Holder a like certificate setting forth (i) such adjustment or readjustment, (ii) the Conversion Price at the time in effect and (iii) the number of shares of Common Stock and the amount, if any, of other securities or property which at the time would be received upon conversion of the Note.

(g) Pending Rulemaking. As of the Issue Date hereof, a proposed rulemaking exists, namely proposed amendments to Rule 144(d)(3)(ii) proposed on December 22, 2020 in SEC Release 2020-336, that would fundamentally change the economic terms of this Note. In the event the rule becomes law and becomes effective while any amounts are outstanding under this Note, Section 1.2 hereof shall be automatically amended to contain only the Fixed Conversion Price to be mutually agreeable and accepted by both parties. . In the event the final rule, or any other combination of final rules, make this provision inoperable, invalid, or otherwise have an effect that changes the economics of the transactions contemplated hereby, the pertinent clause or mechanic of operation shall be stricken and only the Fixed Price provision shall remain.

1.7 Adjustments to Conversion Price. At any time after the Issue Date, (i) if in the case that the Borrower’s Common Stock is not deliverable by DWAC (including if the Borrower’s transfer agent has a policy prohibiting or limiting delivery of shares of the Borrower’s Common Stock specified in a Notice of Conversion); (ii) if the Borrower ceases to be a reporting Borrower pursuant or subject to the Exchange Act; (iii) if after the Borrower gets listed on a trading market, the Borrower subsequently loses a market (including the OTC Pink, OTCQB or an equivalent replacement exchange) for its Common Stock; (iv) if the Borrower fails to maintain its status as “DTC Eligible” for any reason; (v) if the Conversion Price is less than one cent ($0.01); (vi) if the Note cannot be converted into free trading shares on or after six (6) months from the Issue Date; (vii) if at any time the Borrower does not maintain or replenish the Reserved Amount (as defined herein) within three (3) business days of the request of the Holder; (viii) if, once obtained as required under the Transaction Documents, the Borrower fails to maintain the listing of the Common Stock on at least one of the OTC Markets or an equivalent replacement exchange, the Nasdaq National Market, the Nasdaq Small Cap Market, the New York Stock Exchange, or the NYSE MKT; (ix) if the Borrower fails to comply with the reporting requirements of the Exchange Act; the reporting requirements necessary to satisfy the availability of Rule 144 to the Holder or its assigns, including but not limited to the timely fulfillment of its filing requirements as a fully- reporting issuer registered with the SEC,; (x) if the Borrower effectuates a reverse split of its Common Stock without twenty (20) days prior written notice to the Holder; (xi) if, once listed, subsequently OTC Markets changes the Borrower’s designation to ‘No Information’ (Stop Sign), ‘Caveat Emptor’ (Skull and Crossbones), or ‘OTC’, ‘Other OTC’ or ‘Grey Market’ (Exclamation Mark Sign); (xii) the restatement of any financial statements filed by the Borrower with the SEC for any date or period from two (2) years prior to the Issue Date of this Note and until this Note is no longer outstanding, if the result of such restatement would, by comparison to the un-restated financial statement, have constituted a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement; (xiii) once it begins trading on any of the trading markets or exchanges listed hereafter, any cessation of trading of the Common Stock on at least one of the OTC Markets or an equivalent replacement exchange, the Nasdaq National Market, the Nasdaq Small Cap Market, the New York Stock Exchange, or the NYSE MKT, and such cessation of trading shall continue for a period of five consecutive (5) Trading Days; and/or (xiv) the Borrower loses the “bid” price for its Common Stock ($0.0001 on the “Ask” with zero market makers on the “Bid” per Level 2); and/or (xv) if the Holder is notified in writing by the Borrower or the Borrower’s transfer agent that the Borrower does not have the necessary amount of authorized and issuable shares of Common Stock available to satisfy the issuance of Shares pursuant to a Conversion Notice, then in addition to all other remedies under this Note, the Holder shall be entitled to increase, by fifteen percent (15%) for each occurrence, cumulative or otherwise, the discount to the Fixed Conversion Price shall apply for all future conversions under the Note.

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1.8 Status as Shareholder. Upon submission of a Notice of Conversion by a Holder, (i) the Conversion Shares covered thereby (other than the Conversion Shares, if any, which cannot be issued because their issuance would exceed such Holder’s allocated portion of the Reserved Amount or Maximum Share Amount) shall be deemed converted into shares of Common Stock, and (ii) the Holder’s rights as a Holder of such converted portion of this Note shall cease and terminate, excepting only the right to receive certificates for such shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because of a failure by the Borrower to comply with the terms of this Note. Notwithstanding the foregoing, if a Holder has not received certificates for all shares of Common Stock prior to the tenth (10th) business day after the expiration of the Deadline with respect to a conversion of any portion of this Note for any reason, then (unless the Holder otherwise elects to retain its status as a holder of Common Stock by so notifying the Borrower) the Holder shall regain the rights of a Holder of this Note with respect to such unconverted portions of this Note and the Borrower shall, as soon as practicable, return such unconverted Note to the Holder or, if the Note has not been surrendered, adjust its records to reflect that such portion of this Note has not been converted. In all cases, the Holder shall retain all of its rights and remedies for the Borrower’s failure to convert this Note.

1.9 Prepayment. Notwithstanding anything to the contrary contained in this Note, subject to the terms of this Section, at any time during the period beginning on the Issue Date and ending at Maturity (“Prepayment Termination Date”), Borrower shall have the right, exercisable on not less than two (2) Trading Days prior written notice to the Holder of this Note, to prepay up to the outstanding balance on this Note (principal and accrued interest), in full, in accordance with this Section. Any notice of prepayment hereunder (an “Optional Prepayment Notice”) shall be delivered to the Holder of the Note at its registered addresses and shall state: (1) that the Borrower is exercising its right to prepay the Note, and (2) the date of prepayment which shall be not more than fifteen (15) Trading Days from the date of the Optional Prepayment Notice; and (3) the amount (in dollars) that the Borrower is paying. Notwithstanding Holder’s receipt of the Optional Prepayment Notice the Holder may convert, or continue to convert the Note in whole or in part until the Optional Prepayment Amount (as defined herein) is paid to the Holder. On the date fixed for prepayment (the “Optional Prepayment Date”), the Borrower shall make payment of the Optional Prepayment Amount (as defined below) to or upon the order of the Holder as specified by the Holder in writing to the Borrower at least one (1) business day prior to the Optional Prepayment Date. If the Borrower exercises its right to prepay the Note under the terms of this Section, the Borrower shall pay to Holder the sum of one hundred twenty percent (120%) of the total amount outstanding under the Note including, but not limited to all principal, interest, fees, and defaults (the “Optional Prepayment Amount”).

ARTICLE II. RANKING AND CERTAIN COVENANTS

2.1 Ranking and Security. The obligations of the Borrower under this Note shall rank subordinate with respect to any and all Indebtedness incurred as of or following the Issue Date and shall only be secured by the Reserved Amount (as adjusted from time to time herein).

2.2 Other Indebtedness. For the first three months from the date of closing, if theborrower has any obligation under this Note, the Borrower shall not (directly or indirectly through any Subsidiary or affiliate), without Holder’s consent, incur or suffer to exist or guarantee any Indebtedness that is senior to or pari passu with (in priority of payment and performance) the Borrower’s obligations hereunder unless the proceeds of such Indebtedness are used to pay off the interest and principal under this Note. As used in this Section 2.2, the term “Borrower” means the Borrower and any Subsidiary of the Borrower. As used herein, the term “Indebtedness” means (a) all indebtedness of the Borrower for borrowed money, but not including deferred purchase price obligations in place as of the Issue Date and as disclosed in the SEC Documents or obligations to trade creditors incurred in the ordinary course of business; (b) all obligations of the Borrower evidenced by notes, bonds, debentures or other similar instruments; (c) purchase money indebtedness hereafter incurred by the Borrower to finance the purchase of fixed or capital assets, including all capital lease obligations of the Borrower which do not exceed the purchase price of the assets funded; (d) all guarantee obligations of the Borrower in respect of obligations of the kind referred to in clauses (a) through (c) above that the Borrower would not be permitted to incur or enter into; and (e) all obligations of the kind referred to in clauses (a) through (d) above that the Borrower is not permitted to incur or enter into that are secured and/or unsecured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured and/or unsecured by) any lien or encumbrance on property (including accounts and contract rights) owned by the Borrower, whether or not the Borrower has assumed or become liable for the payment of such obligation.

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2.3 Distributions on Capital Stock. For the first three months from the date of closing, if the borrower has any obligation under this Note, the Borrower shall not without the Holder’s written consent (a) pay, declare or set apart for such payment, any dividend or other distribution (whether in cash, property or other securities) on shares of capital stock other than dividends on shares of Common Stock solely in the form of additional shares of Common Stock or (b) directly or indirectly or through any subsidiary make any other payment or distribution in respect of its capital stock except for distributions pursuant to any shareholders’ rights plan which is approved by a majority of the Borrower’s disinterested directors.

2.4 Restriction on Stock Repurchases. For the first three months from the date of closing, if the borrower has any obligation under this Note, the Borrower shall not without the Holder’s written consent redeem, repurchase or otherwise acquire (whether for cash or in exchange for property or other securities or otherwise) in any one transaction or series of related transactions any shares of capital stock of the Borrower or any warrants, rights or options to purchase or acquire any such shares.

2.5 Sale of Assets. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, sell, lease or otherwise dispose of any significant portion of its assets outside the ordinary course of business. Any consent to the disposition of any assets may be conditioned on a specified use of the proceeds of disposition, but otherwise such consent shall not be unreasonably withheld, conditioned, or delayed.

2.6 Advances and Loans; Affiliate Transactions. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, lend money, give credit, make advances to or enter into any transaction with any person, firm, joint venture or corporation, including, without limitation, officers, directors, employees, subsidiaries and affiliates of the Borrower, except loans, credits or advances (a) in existence or committed on the Issue Date and which the Borrower has informed Holder in writing prior to the Issue Date, (b) in regard to transactions with unaffiliated third parties, made in the ordinary course of business or (c) in regard to transactions with unaffiliated third parties, not in excess of $150,000. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, repay any affiliate (as defined in Rule 144) of the Borrower in connection with any indebtedness or accrued amounts owed to any such party outside the ordinary course of business.

2.7 Section 3(a)(9) or 3(a)(10) Transaction. So long as this Note is outstanding, the Borrower shall not enter into any transaction or arrangement structured in accordance with, based upon, or related or pursuant to, in whole or in part, either Section 3(a)(9) of the Securities Act (a “3(a)(9) Transaction”) or Section 3(a)(l0) of the Securities Act (a “3(a)(l0) Transaction”). In the event that the Borrower does enter into, or makes any issuance of Common Stock related to a 3(a)(9) Transaction or a 3(a)(l0) Transaction while this note is outstanding, a liquidated damages charge of twenty-five percent (25%) of the outstanding principal balance of this Note, but not less than Twenty-Five Thousand Dollars ($25,000), will be assessed and will become immediately due and payable to the Holder at its election in the form of a cash payment or added to the balance of this Note (under Holder’s and Borrower’s expectation that this amount will tack back to the Issue Date).

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2.8 Preservation of Business and Existence, etc. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, (a) change the nature of its business in a material respect; (b) sell, divest, change the structure of any material assets other than in the ordinary course of business; or (c) within the first ninety (90) days after the Issue Date hereof, enter into any variable rate transactions or Merchant Cash Advance transactions except as in effect the date hereof. In addition, so long as the Borrower shall have any obligation under this Note, the Borrower shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries (other than dormant Subsidiaries that have no or minimum assets) to become or remain, duly qualified and in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary. Furthermore, so long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, solicit any offers for, respond to any unsolicited offers for, or conduct any negotiations with, any other person or entity with respect to any Variable Rate Transaction or investment.

2.9 Non-circumvention. The Borrower hereby covenants and agrees that the Borrower will not, by amendment of its Certificate or Articles of Incorporation or Bylaws, or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Note, and will at all times in good faith carry out all the provisions of this Note and take all action as may be required to protect the rights of the Holder.

2.10 Lost, Stolen or Mutilated Note. Upon receipt by the Borrower of evidence reasonably satisfactory to the Borrower of the loss, theft, destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Borrower in customary form and, in the case of mutilation, upon surrender and cancellation of this Note, the Borrower shall execute and deliver to the Holder a new Note.

ARTICLE III. EVENTS OF DEFAULT

It shall be considered an event of default if any of the following events listed in this Article III (each, an “Event of Default”) shall occur. Subject to any exceptions contained in this Section, the Borrower shall have five (5) calendar days from the date of the occurrence of the Event of Default to cure that Event of Default. Failure to cure within five (5) calendar days shall subject the Borrower to the rights and remedies available to Holder as set forth herein.

3.1 Conversion and the Shares. The Borrower (i) fails to issue Conversion Shares to the Holder (or announces or threatens in writing that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder in accordance with the terms of this Note; (ii) fails to transfer or cause its transfer agent to transfer (issue) (electronically or in certificated form) any certificate for the Conversion Shares issuable to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note; (iii) reserve the Reserved Amount at all times; or (iv) the Borrower directs its transfer agent not to transfer or delays, impairs, and/or hinders its transfer agent in transferring (or issuing) (electronically or in certificated form) any certificate for the Conversion Shares issuable to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, or fails to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any Conversion Shares issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note (or makes any written announcement, statement or threat that it does not intend to honor the obligations described in this paragraph) and any such failure shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall not be rescinded in writing) for eight (8) Trading Days after the Holder shall have delivered a Notice of Conversion. It is an obligation of the Borrower to remain current in its obligations to its transfer agent. It shall be an Event of Default of this Note, if a conversion of this Note is delayed, hindered or frustrated due to a balance owed by the Borrower to its transfer agent. If at the option of the Holder, the Holder advances any funds to the Borrower’s transfer agent in order to process a conversion, such advanced funds shall be paid by the Borrower to the Holder within forty-eight (48) hours of a demand from the Holder. The five (5) day cure period shall not apply to this Section 3.1.

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3.2 Breach of Agreements and Covenants. The Borrower breaches any material agreement, covenant or other material term or condition contained in the Purchase Agreement, this Note, the Irrevocable Transfer Agent Instructions or in any agreement, statement or certificate given in writing pursuant hereto or in connection herewith or therewith.

3.3 Breach of Representations and Warranties. Any material representation or warranty of the Borrower made in the Purchase Agreement, this Note, the Irrevocable Transfer Agent Instructions or in any agreement, statement or certificate given in writing pursuant hereto or in connection herewith or therewith shall be false or misleading in any material respect when made and the breach of which has (or with the passage of time will have) a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.

3.4 Receiver or Trustee. The Borrower or any subsidiary of the Borrower shall make an assignment for the benefit of creditors, or apply for or consent to the appointment of a receiver or trustee for it or for a substantial part of its property or business, or such a receiver or trustee shall otherwise be appointed.

3.5 Judgments. Any money judgment, writ or similar process shall be entered or filed against the Borrower or any subsidiary of the Borrower or any of its property or other assets for more than $150,000, and shall remain unvacated, unbonded or unstayed for a period of twenty (20) days unless otherwise consented to by the Holder, which consent will not be unreasonably withheld.

3.6 Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary, for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Borrower or any subsidiary of the Borrower.

3.7 Delisting of Common Stock. The Borrower should fail to maintain the listing of the Common Stock on at least one of the OTCQB Market, or any level of the Nasdaq Stock Market or the New York Stock Exchange (including the NYSE American).

3.8 Failure to Comply with the 1934 Act. At any time after the Issue Date, the Borrower shall fail to comply with the reporting requirements of the 1934 Act and/or the Borrower shall cease to be subject to the reporting requirements of the 1934 Act. It shall be an Event of Default under this Section 3.9 if the Borrower shall file any Notification of Late Filing on Form 12b-25 with the SEC.

3.9 Liquidation. Any dissolution, liquidation, or winding up of Borrower or any substantial portion of its business.

3.10 Cessation of Operations. Any cessation of operations by Borrower or Borrower admits it is otherwise generally unable to pay its debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to continue as a “going concern” shall not be an admission that the Borrower cannot pay its debts as they become due.

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3.11 Maintenance of Assets. The failure by Borrower to maintain any material intellectual property rights, personal, real property or other assets which are necessary to conduct its business (whether now or in the future).

3.12 Financial Statement Restatement. The restatement of any financial statements filed by the Borrower with the SEC for any date or period from two (2) years prior to the Issue Date of this Note and until this Note is no longer outstanding, if the result of such restatement would, by comparison to the unrestated financial statement, have constituted a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.

3.13 Replacement of Transfer Agent. In the event that the Borrower proposes to replace its transfer agent, the Borrower fails to provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to the Purchase Agreement (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower.

3.14 DTC “Chill”. The DTC places a “chill” (i.e. a restriction placed by DTC on one or more of DTC’s services, such as limiting a DTC participant’s ability to make a deposit or withdrawal of the security at DTC) on any of the Borrower’s securities.

3.15 Illegality. Any court of competent jurisdiction issues an order declaring this Note, the Purchase Agreement or any provision hereunder or thereunder to be illegal.

3.17. DWAC Eligibility. The Common Stock is otherwise not eligible for trading through the DTC’s Fast Automated Securities Transfer or Deposit/Withdrawal at Custodian programs.

3.18 Variable Rate Transactions; Dilutive Issuances. The Borrower (i) issues shares of Common Stock (or convertible securities or Purchase Rights) pursuant to an equity line of credit of the Borrower or otherwise in connection with a Variable Rate Transaction; (ii) adjusts downward the “floor price” at which shares of Common Stock (or convertible securities or Purchase Rights) may be issued under an equity line of credit or otherwise in connection with a Variable Rate Transaction (or entered into in the future) except for existing lines of credit or Variable Rate Transactions existing as of the date hereof, or (iii) a Dilutive Issuance is triggered as provided in this Note.

3.19 Bid Price. Once the Borrower obtains a listing, the Borrower shall subsequently lose the “bid” price for its Common Stock ($0.0001 on the “Ask” with zero market makers on the “Bid” per Level 2) and/or a market (including the OTC Pink, OTCQB or an equivalent replacement marketplace or exchange).

3.20 Inside Information. Any attempt by the Borrower or its officers, directors, and/or affiliates to intentionally transmit, convey, disclose, or any actual transmittal, conveyance, or disclosure by the Borrower or its officers, directors, and/or affiliates of, material non-public information concerning the Borrower, to the Holder or its successors and assigns, which is not immediately cured by Borrower’s filing of a Form 8-K pursuant to Regulation FD on that same date.

3.21 Unavailability of Rule 144. If, at any time on or after the date which is six (6) months after the Issue Date, except due to the Holder’s actions or inactions, the Holder is unable to (i) obtain a standard “144 legal opinion letter” from an attorney reasonably acceptable to the Holder, the Holder’s brokerage firm (and respective clearing firm), and the Borrower’s transfer agent in order to facilitate the Holder’s conversion of any portion of the Note into free trading shares of the Borrower’s Common Stock pursuant to Rule 144, and/or (ii) thereupon deposit such shares into the Holder’s brokerage account.

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3.22 Delisting or Suspension of Trading of Common Stock. If, at any time on or after the Borrower obtains a listing, the Borrower’s Common Stock (i) is suspended from trading; (ii) halted from trading; and/or (iii) fails to be quoted or listed (as applicable) on any level of the OTC Markets, any tier of the NASDAQ Stock Market, the New York Stock Exchange, or the NYSE American.

3.23 Failure to Complete Mimo Transaction. The Borrower shall complete the transaction with Mimo, no later than April 1, 2021. Failure to do so, shall constitute an Event of Default hereunder.

3.24 Rights and Remedies Upon an Event of Default. Upon the occurrence and during the continuation of any Event of Default specified in this Article III, this Note shall become immediately due and payable and the Borrower shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount (the “Default Amount”) equal to the Principal Amount then outstanding plus accrued interest (including any Default Interest) through the date of full repayment multiplied by one hundred thirty-five percent (135%). Holder may, in its sole discretion, determine to accept payment part in Common Stock and part in cash. For purposes of payments in Common Stock, the conversion formula set forth in Section 1.2 shall apply. Upon an uncured Event of Default, all amounts payable hereunder shall immediately become due and payable, all without demand, presentment or notice, all of which hereby are expressly waived by the Borrower, together with all costs, including, without limitation, legal fees and expenses, of collection, and the Holder shall be entitled to exercise all other rights and remedies available at law or in equity, including, without limitation. In addition, any uncured Event of Default under this Section 3, shall also result in the conversion price under the Note being adjusted to equal the lesser of (i) $0.01 per share; or (ii) seventy percent (70%) of the lowest traded price in the preceding fifteen (15) consecutive Trading Days.

ARTICLE IV. MISCELLANEOUS

4.1 Failure or Indulgence Not Waiver. No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privileges. All rights and remedies of the Holder existing hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available.

4.2 Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, e-mail or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by e-mail or facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be:

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If to the Borrower, to:

TRAQIQ, INC.

14205 SE 36^th Street, Suite 100

Bellevue, Washington 98006

Attention: Ajay Sikka

e-mail:

If to the Holder:

PLATINUM POINT CAPITAL, LLC

353 Lexington Avenue, Suite 1502

New York, New York 10016

Attention: Brian Freifeld, President

e-mail: brian@platinumpointcap.com

With a copy by e-mail only to (which copy shall not constitute notice):

FABIAN VANCOTT

215 South State Street, Suite 1200

Salt Lake City, Utah 84111

Attn: Anthony Michael Panek

e-mail: apanek@fabianvancott.com

4.3 Amendments. This Note and any provision hereof may only be amended by an instrument in writing signed by the Borrower and the Holder. The term “Note” and all reference thereto, as used throughout this instrument, shall mean this instrument as originally executed, or if later amended or supplemented, then as so amended or supplemented.

4.4 Assignability. This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to be the benefit of the Holder and its successors and assigns. Neither the Borrower nor the Holder shall assign this Note or any rights or obligations hereunder without the prior written consent of the other. Notwithstanding the foregoing, the Holder may assign its rights hereunder to any “accredited investor” (as defined in Rule 501(a) of the 1933 Act) in a private transaction from the Holder or to any of its “affiliates”, as that term is defined under the 1934 Act, without the consent of the Borrower. Notwithstanding anything in this Note to the contrary, this Note may be pledged as collateral in connection with a bona fide margin account or other lending arrangement. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that following conversion of a portion of this Note, the unpaid and unconverted principal amount of this Note represented by this Note may be less than the amount stated on the face hereof.

4.5 Cost of Collection. If default is made in the payment of this Note, the Borrower shall pay the Holder hereof costs of collection, including reasonable attorneys’ fees.

4.6 Governing Law; Venue; Attorney’s Fees. This Note shall be governed by and construed in accordance with the laws of the State of Nevada without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Note or any other agreement, certificate, instrument or document contemplated hereby shall be brought only in the state courts located in the state of New York or federal courts located in the state of New York. The Borrower hereby irrevocably waives any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. THE BORROWER HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTIONS CONTEMPLATED HEREBY. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Note or any other agreement, certificate, instrument or document contemplated hereby or thereby by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. The prevailing party in any action or dispute brought in connection with this the Note or any other agreement, certificate, instrument or document contemplated hereby or thereby shall be entitled to recover from the other party its reasonable attorney’s fees and costs.

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4.7 Certain Amounts. Whenever pursuant to this Note the Borrower is required to pay an amount in excess of the outstanding Principal Amount (or the portion thereof required to be paid at that time) plus accrued and unpaid interest plus Default Interest on such interest, the Borrower and the Holder agree that the actual damages to the Holder from the receipt of cash payment on this Note may be difficult to determine and the amount to be so paid by the Borrower represents stipulated damages and not a penalty and is intended to compensate the Holder in part for loss of the opportunity to convert this Note and to earn a return from the sale of shares of Common Stock acquired upon conversion of this Note at a price in excess of the price paid for such shares pursuant to this Note. The Borrower and the Holder hereby agree that such amount of stipulated damages is not plainly disproportionate to the possible loss to the Holder from the receipt of a cash payment without the opportunity to convert this Note into shares of Common Stock.

4.8 Purchase Agreement. The Borrower and the Holder shall be bound by the applicable terms of the Purchase Agreement and the documents entered into in connection herewith and therewith.

4.9 Notice of Corporate Events. Except as otherwise provided below, the Holder of this Note shall have no rights as a Holder of Common Stock unless and only to the extent that it converts this Note into Common Stock. The Borrower shall provide the Holder with prior notification of any meeting of the Borrower’s shareholders (and copies of proxy materials and other information sent to shareholders). In the event of any taking by the Borrower of a record of its shareholders for the purpose of determining shareholders who are entitled to receive payment of any dividend or other distribution, any right to subscribe for, purchase or otherwise acquire (including by way of merger, consolidation, reclassification or recapitalization) any share of any class or any other securities or property, or to receive any other right, or for the purpose of determining shareholders who are entitled to vote in connection with any Change in Control or any proposed liquidation, dissolution or winding up of the Borrower, the Borrower shall mail a notice to the Holder, at least twenty (20) days prior to the record date specified therein (or thirty (30) days prior to the consummation of the transaction or event, whichever is earlier), of the date on which any such record is to be taken for the purpose of such dividend, distribution, right or other event, and a brief statement regarding the amount and character of such dividend, distribution, right or other event to the extent known at such time. The Borrower shall make a public announcement of any event requiring notification to the Holder hereunder substantially simultaneously with the notification to the Holder in accordance with the terms of this Section 4.9.

4.10 Remedies. The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder, by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Borrower acknowledges that the remedy at law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened breach by the Borrower of the provisions of this Note, that the Holder shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Note and to enforce specifically the terms and provisions thereof, without the necessity of showing economic loss and without any bond or other security being required.

4.11 Construction; Headings. This Note shall be deemed to be jointly drafted by the Borrower and all the Holder and shall not be construed against any person as the drafter hereof. The headings of this Note are for convenience of reference and shall not form part of, or affect the interpretation of, this Note.

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4.12 Usury. To the extent it may lawfully do so, the Borrower hereby agrees not to insist upon or plead or in any manner whatsoever claim, and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at any time hereafter in force, in connection with any action or proceeding that may be brought by the Holder in order to enforce any right or remedy under this Note. Notwithstanding any provision to the contrary contained in this Note, it is expressly agreed and provided that the total liability of the Borrower under this Note for payments which under the applicable law are in the nature of interest shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”), and, without limiting the foregoing, in no event shall any rate of interest or default interest, or both of them, when aggregated with any other sums which under the applicable law in the nature of interest that the Borrower may be obligated to pay under this Note exceed such Maximum Rate. It is agreed that if the maximum contract rate of interest allowed by applicable law and applicable to this Note is increased or decreased by statute or any official governmental action subsequent to the Issue Date, the new maximum contract rate of interest allowed by law will be the Maximum Rate applicable to this Note from the effective date thereof forward, unless such application is precluded by applicable law. If under any circumstances whatsoever, interest in excess of the Maximum Rate is paid by the Borrower to the Holder with respect to indebtedness evidenced by this the Note, such excess shall be applied by the Holder to the unpaid principal balance of any such indebtedness or be refunded to the Borrower, the manner of handling such excess to be at the Holder’s election.

4.13 Severability. In the event that any provision of this Note is invalid or unenforceable under any applicable statute or rule of law (including any judicial ruling), then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of this Note.

4.14 Most-Favored Nation. During the first three months this Note is outstanding, upon any issuance by the Borrower or any of its subsidiaries of any new security, with any term that the Holder reasonably believes is more favorable to the holder of such security or with a term in favor of the holder of such security that the Holder reasonably believes was not similarly provided to the Holder in this Note, then (i) the Borrower shall notify the Holder of such additional or more favorable term within one (1) business day of the issuance and/or amendment (as applicable) of the respective security, and (ii) such term, at Holder’s option, shall become a part of the transaction documents with the Holder (regardless of whether the Borrower complied with the notification provision of this Section 4.14). The types of terms contained in another security that may be more favorable to the holder of such security include, but are not limited to, terms addressing conversion discounts, prepayment rate, conversion lookback periods, interest rates, and original issue discounts. If Holder elects to have the term become a part of the transaction documents with the Holder, then the Borrower shall immediately deliver acknowledgment of such adjustment in form and substance reasonably satisfactory to the Holder (the “Acknowledgment”) within one (1) business day of Borrower’s receipt of request from Holder (the “Adjustment Deadline”), provided that Borrower’s failure to timely provide the Acknowledgement shall not affect the automatic amendments contemplated hereby. This section shall apply to any securities previously issued to Holder.

4.15 Dispute Resolution. In the case of a dispute as to the determination of the Conversion Price, Conversion Amount, any prepayment amount or Default Amount, Issue, Closing or Maturity Date, the closing bid price, or fair market value (as the case may be) or the arithmetic calculation of the Conversion Price or the applicable prepayment amount(s) (as the case may be), the Borrower or the Holder shall submit the disputed determinations or arithmetic calculations via facsimile (i) within one (1) Trading Day after receipt of the applicable notice giving rise to such dispute to the Borrower or the Holder or (ii) if no notice gave rise to such dispute, at any time after the Holder learned of the circumstances giving rise to such dispute. If the Holder and the Borrower are unable to agree upon such determination or calculation within five (5) Trading Days of such disputed determination or arithmetic calculation (as the case may be) being submitted to the Borrower or the Holder, then the Borrower shall, within three (3) Trading Days, submit (a) the disputed determination of the Conversion Price, the closing bid price, the or fair market value (as the case may be) to an independent, reputable investment bank selected by the Borrower and approved by the Holder or (b) the disputed arithmetic calculation of the Conversion Price, Conversion Amount, any prepayment amount or Default Amount, to an independent, outside accountant selected by the Holder that is reasonably acceptable to the Borrower. The Borrower shall cause at its expense the investment bank or the accountant to perform the determinations or calculations and notify the Borrower and the Holder of the results no later than one (1) Trading Day from the time it receives such disputed determinations or calculations. Such investment bank’s or accountant’s determination or calculation shall be binding upon all parties absent demonstrable error.

[signature page follows]

18

IN WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer on February 12, 2021.

TRAQIQ, INC.

By:	/s/ Ajay Sikka
Name:	Ajay Sikka
Title:	Chief Executive Officer

19

EXHIBIT A — NOTICE OF CONVERSION

The undersigned hereby elects to convert $ principal amount of the Note (defined below) into that number of shares of Common Stock to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of TRAQIQ, INC., a California corporation (the “Borrower”), according to the conditions of the Convertible Promissory Note of the Borrower dated as of February 12, 2021 (the “Note”), as of the date written below. No fee will be charged to the Holder for any conversion, except for transfer taxes, if any.

Box Checked as to applicable instructions:

☐	The Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the undersigned or its nominee with DTC through its Deposit Withdrawal Agent Commission system (“DWAC Transfer”).
	Name of DTC Prime Broker:
	Account Number:

☐ The undersigned hereby requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock set forth below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or, if additional space is necessary, on an attachment hereto:

PLATINUM POINT CAPITAL, LLC

353 Lexington Avenue, Suite 1502

New York, New York 10016

Attention: Brian Freifeld, President

e-mail: brian@platinumpointcap.com

Date of Conversion:	____________
Applicable Conversion Price:	$
Costs Incurred by the Undersigned to Convert the Note into Shares of Common Stock:	$___________
Number of Shares of Common Stock to be Issued Pursuant to Conversion of the Note:	____________
Amount of Principal Balance Due remaining Under the Note after this conversion:	____________

By:

Name:

Title:

Date:

EX-23.1

Exhibit 23.1

	A-94/8, Wazirpur Industrial Area,
	Main Ring Road, Delhi-110052
	+91 11 45596689
	Web : www.ajsh.in
	E-mail : info@ajsh.in

Consent of Independent Registered Public Accounting Firm

To the Board of Directors

TraqlQ, Inc.

14205 SE 36^th St., Suite 100

Bellevue, WA 98006

We hereby consent to the incorporation in the Registration Statement under The Securities Act of 1933 i.e. Form S-1 of TraqlQ, lnc.(the "Company'') of our report dated March 22, 2021, with respect to the Consolidated financial statements of the Company for the year ended December 31, 2020 and December 31, 2019 and the related notes of the financial statements.

/s/ AJSH& Co LLP Delhi, India October 5, 2021  

XML

Cover	6 Months Ended
	Jun. 30, 2021
Cover [Abstract]
Document Type	S-1
Amendment Flag	false
Entity Registrant Name	TRAQIQ, INC.
Entity Central Index Key	0001514056
Entity Tax Identification Number	30-0580318
Entity Incorporation, State or Country Code	CA
Entity Address, Address Line One	4205 SE 36th Street
Entity Address, Address Line Two	Suite 100
Entity Address, City or Town	Bellevue
Entity Address, State or Province	WA
Entity Address, Postal Zip Code	98006
City Area Code	(425)
Local Phone Number	818-0560
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false

XML

Condensed Consolidated Balance Sheets - USD ($)	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
Current Assets:
Cash	$ 137,530	$ 29,658	$ 9,094
Accounts receivable, net	677,302	521,618	602,155
Note receivable - related party		227,877
Prepaid expenses and other current assets	481,606	322,286	207,581
Total Current Assets	1,296,438	1,101,439	818,830
Fixed assets, net	36,819	36,373	48,681
Intangible assets, net	563,632	444,584	477,824
Goodwill	6,507,680
Restricted cash	165,488	28,746	182,627
Long-term investment	1,440	40,603	41,617
Right-of-use asset	118,237	126,118	537,268
Other assets	3,409	3,196	32,639
Total Non-current Assets	7,396,705	679,620	1,320,656
TOTAL ASSETS	8,693,143	1,781,059	2,139,486
Current Liabilities:
Accounts payable and accrued expenses	1,616,953	1,163,505	883,845
Cash overdraft	233,729	188,721	427,890
Accrued payroll and related taxes	447,569	327,084	291,586
Accrued taxes and duties payable	157,152	46,577	50,623
Deferred revenue	39,215
Derivative liability	1,510,000
Contingent consideration - Rohuma	1,383,954
Contingent consideration - Mimo	656,179
Current portion - lease liability	11,168	8,779	122,343
Current portion - long-term debt - related parties	2,629,839	1,843,399	1,306,737
Current portion - long-term debt	317,876	133,761	191,508
Current portion - convertible notes payable, net of discounts	328,098
Current portion - convertible debt - long-term debt - related and unrelated parties	85,084	241,334	241,334
Total Current Liabilities	9,416,816	3,953,160	3,515,866
Long-term debt - related parties, net of current portion	15,000		32,000
Long-term debt, net of current portion	55,292	59,856	19,202
Lease liability, net of current portion	116,751	125,219	432,800
Total Non-current Liabilities	187,043	185,075	484,002
Total Liabilities	9,603,859	4,138,235	3,999,868
Commitments and contingencies
STOCKHOLDERS’ EQUITY (DEFICIT)
Preferred stock, par value, $0.0001, 10,000,000 shares authorized, Series A Convertible Preferred, 50,000 and 50,000 shares issued and outstanding, respectively	5	5	5
Common stock, par value, $0.0001, 300,000,000 shares authorized, 31,430,575 and 27,297,960 issued and outstanding, respectively	3,143	2,730	2,730
Additional paid in capital	5,090,929	117,261	12,623
Accumulated deficit	(6,008,129)	(2,504,893)	(1,896,984)
Accumulated other comprehensive income (loss)	773	27,721	21,244
Total Stockholders’ Equity (Deficit) before Non-controlling Interest	(913,279)	(2,357,176)
Non-controlling interest	2,563
Total Stockholders’ Equity (Deficit)	(910,716)	(2,357,176)	(1,860,382)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	$ 8,693,143	$ 1,781,059	$ 2,139,486

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
Preferred stock, par value	$ 0.0001	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	10,000,000	10,000,000	10,000,000
Common stock, par value	$ 0.0001	$ 0.0001	$ 0.0001
Common stock, shares authorized	300,000,000	300,000,000	300,000,000
Common stock, shares issued	31,430,575	27,297,960	27,297,960
Common stock, shares outstanding	31,430,575	27,297,960	27,297,960
Series A Convertible Preferred Stock [Member]
Preferred stock, shares issued	50,000	50,000	50,000
Preferred stock, shares outstanding	50,000	50,000	50,000

XML

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Income Statement [Abstract]
REVENUE	$ 937,002	$ 230,258	$ 1,319,388	$ 521,319	$ 1,009,949	$ 680,732
COST OF REVENUE	788,196	129,545	1,012,028	268,683	546,569	431,363
GROSS PROFIT	148,806	100,713	307,360	252,636	463,380	249,369
OPERATING EXPENSES
Salaries and salary related costs	160,582	48,214	309,013	94,639	284,258	114,615
Professional fees	135,863	55,253	287,288	115,135	201,430	287,775
Rent expense	7,725	30,886	15,511	63,895	101,845	88,863
Depreciation and amortization expense	20,301	12,076	37,019	24,806	47,988	42,840
General and administrative expenses	692,245	26,661	1,527,969	61,419	182,827	160,919
Total Operating Expenses	1,016,716	173,090	2,176,800	359,894	818,348	695,012
OPERATING LOSS	(867,910)	(72,377)	(1,869,440)	(107,258)	(354,968)	(445,643)
OTHER INCOME (EXPENSE)
Change in fair value of derivative liability	(691,125)		(1,196,132)
Bargain purchase gain						417,148
PPP forgiveness and other income		10,000	10,073	10,000	76,248	55,450
Interest expense, net of interest income	(217,545)	(81,986)	(363,178)	(165,170)	(328,380)	(250,164)
Total other income (expense)	(908,670)	(71,986)	(1,549,237)	(155,170)	(252,132)	222,434
NET LOSS BEFORE PROVISION FOR INCOME TAXES	(1,776,580)	(144,363)	(3,418,677)	(262,428)	(607,100)	(223,209)
Provision for income taxes	33,722	(3)	81,996	806	809
NET LOSS	(1,810,302)	(144,360)	(3,500,673)	(263,234)	(607,909)	(223,209)
NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST	(1,110)		(2,563)
NET LOSS ATTRIBUTABLE TO CONTROLLING INTEREST	(1,811,412)	(144,360)	(3,503,236)	(263,234)	(607,909)	(223,209)
Other comprehensive loss
Foreign currency translations adjustment	(20,809)	(11,447)	(26,948)	(37,607)	6,477	21,244
Comprehensive income (loss)	$ (1,832,221)	$ (155,807)	$ (3,530,184)	$ (300,841)	$ (601,432)	$ (201,965)
Net loss per share	$ (0.06)	$ (0.01)	$ (0.11)	$ (0.01)	$ (0.02)	$ (0.01)
Weighted average common shares outstanding - basic and diluted	31,168,641	27,297,960	30,478,877	27,297,960	27,297,960	27,297,960
Comprehensive loss	$ (1,832,221)	$ (155,807)	$ (3,530,184)	$ (300,841)	$ (601,432)	$ (201,965)

XML

Condensed Consolidated Statement of Changes in Stockholders' Equity (Deficit) - USD ($)	Preferred Stock Series A [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Noncontrolling Interest [Member]	Total
Balance at Dec. 31, 2018	$ 5	$ 2,730	$ 12,355	$ (1,673,775)			$ (1,658,685)
Balance, shares at Dec. 31, 2018	50,000	27,297,960
Acquisition of Mann-India			268		5,116		5,384
Net loss for the period				(223,209)	16,128		(207,081)
Balance at Dec. 31, 2019	$ 5	$ 2,730	12,623	(1,896,984)	21,244		(1,860,382)
Balance, shares at Dec. 31, 2019	50,000	27,297,960
Net loss for the period				(118,874)	(26,160)		(145,034)
Balance at Mar. 31, 2020	$ 5	$ 2,730	12,623	(2,015,858)	(4,916)		(2,005,416)
Balance, shares at Mar. 31, 2020	50,000	27,297,960
Balance at Dec. 31, 2019	$ 5	$ 2,730	12,623	(1,896,984)	21,244		(1,860,382)
Balance, shares at Dec. 31, 2019	50,000	27,297,960
Stock-based compensation on granting of options			104,638				104,638
Net loss for the period				(607,909)	6,477		(601,432)
Balance at Dec. 31, 2020	$ 5	$ 2,730	117,261	(2,504,893)	27,721		(2,357,176)
Balance, shares at Dec. 31, 2020	50,000	27,297,960
Balance at Mar. 31, 2020	$ 5	$ 2,730	12,623	(2,015,858)	(4,916)		(2,005,416)
Balance, shares at Mar. 31, 2020	50,000	27,297,960
Net loss for the period				(144,360)	(11,447)		(155,807)
Balance at Jun. 30, 2020	$ 5	$ 2,730	12,623	(2,160,218)	(16,363)		(2,161,223)
Balance, shares at Jun. 30, 2020	50,000	27,297,960
Balance at Dec. 31, 2020	$ 5	$ 2,730	117,261	(2,504,893)	27,721		(2,357,176)
Balance, shares at Dec. 31, 2020	50,000	27,297,960
Shares of stock issued for cash		$ 57	455,943				456,000
Shares of stock issued for cash, shares		570,000
Shares of stock issued for conversion of notes payable and accrued interest		$ 26	224,661				224,687
Shares of stock issued for conversion of notes payable and accrued interest, shares		264,338
Shares of stock issued for services rendered		$ 40	436,345				436,385
Shares of stock issued for services rendered, shares		400,000
Shares of stock issued for acquisition of Rohuma (first tranche)		$ 256	2,049,565				2,049,821
Shares of stock issued for acquisition of Rohuma (first tranche), shares		2,562,277
Stock-based compensation on granting of options			108,341				108,341
Stock-based compensation - warrants granted for consulting			68,642				68,642
Warrants earned for acquisition of Mimo			984,268				984,268
Net loss for the period				(1,691,824)	(6,139)	1,453	(1,696,510)
Balance at Mar. 31, 2021	$ 5	$ 3,109	4,445,026	(4,196,717)	21,582	1,453	274,458
Balance, shares at Mar. 31, 2021	50,000	31,094,575
Shares of stock issued for cash		$ 4	38,496				38,500
Shares of stock issued for cash, shares		35,000
Shares of stock issued for services rendered			1,750				1,750
Shares of stock issued for services rendered, shares		1,000
Stock-based compensation on granting of options			118,465				118,465
Stock-based compensation for restricted stock grants (shares not issued)			40,222				40,222
Shares of stock issued for providing note payable		$ 30	446,970				447,000
Shares of stock issued for providing note payable, shares		300,000
Net loss for the period				(1,811,412)	(20,809)	1,110	(1,831,111)
Balance at Jun. 30, 2021	$ 5	$ 3,143	$ 5,090,929	$ (6,008,129)	$ 773	$ 2,563	$ (910,716)
Balance, shares at Jun. 30, 2021	50,000	31,430,575

XML

Condensed Consolidated Statements of Cash Flows - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
CASH FLOW FROM OPERTING ACTIVIITES
Net loss	$ (3,503,236)	$ (263,234)	$ (607,909)	$ (223,209)
Adjustments to reconcile net loss to net cash (used in) operating activities
Change in non-controlling interest	2,563
Bargain purchase gain				(417,148)
Bad debt expense	223,673			60,460
Forgiveness of debt	(10,087)		(64,725)	(55,450)
Depreciation and amortization	37,019	24,806	47,988	42,840
Lease cost, net of repayment	1,936	5,724	6,297	13,226
Foreign currency (gain) loss	2,164	(10,401)	29,587	18,882
Stock-based compensation	295,448		104,638
Common stock issued for services rendered	925,356
Change in fair value of derivative liability	1,196,132
Amortization of discounts on debt	146,966
Changes in assets and liabilities
Accounts receivable	(415,092)	56,303	65,816	(153,492)
Prepaid expenses and other current assets	90,730	(84,563)	(144,600)	12,019
Other assets			28,647	(4,823)
Accounts payable and accrued expenses	(325,373)	215,446	293,943	238,873
Accrued payroll and payroll taxes	14,738	20,526	55,967	(29,669)
Accrued duties and taxes	76,995	20,105	(2,813)	(15,395)
Deferred revenue	30,974			(3,623)
Total adjustments	2,294,142	247,946	420,745	(293,300)
Net cash (used in) operating activities	(1,209,094)	(15,288)	(187,164)	(516,509)
CASH FLOWS FROM INVESTING ACTIVITES
Cash received in acquisition of Mimo	42,905			234
Cash received in acquisition of Rohuma	5,951
Acquisition of Mimo	(21,856)
Restricted cash received in acquisition of Mann				185,399
Advances of note receivable - related party		(173,802)	(227,877)
Acquisition of fixed assets	(2,010)	(2,011)	(3,709)	(3,417)
Net cash provided by (used in) investing activities	24,990	(175,813)	(231,586)	182,216
CASH FLOWS FROM FINANCING ACTIVITES
Increase in cash overdraft	45,258	37,277	(228,745)	(36,691)
Proceeds from the issuance of common stock	494,500
Proceeds from convertible notes	515,000
Repayment of convertible notes	(20,000)
Proceeds from long-term debt - related parties	1,122,096	144,759	554,940	593,201
Repayment of long-term debt - related parties	(681,968)	(25,000)	(42,100)	(104,841)
Proceeds from long-term debt	50,331	42,797	197,540	143,600
Repayments of long-term debt	(96,499)	(25,284)	(196,202)	(71,602)
Net cash provided by financing activities	1,428,718	174,549	285,433	523,667
NET INCREASE (DECREASE) IN CASH AND RESTRICTED CASH	244,614	(16,552)	(133,317)	189,374
CASH AND RESTRICTED CASH - BEGINNING OF PERIOD	58,404	191,721	191,721	2,347
CASH AND RESTRICTED CASH - END OF PERIOD	303,018	175,169	58,404	191,721
CASH PAID DURING THE PERIOD FOR:
Interest expense	21,908	55,484	84,830	11,782
Income taxes	81,996	946	1,609
Acquisition of Mann:
Accounts receivable				506,951
Prepaid and other current assets				216,956
Right-of-use asset				576,566
Fixed assets				68,260
Other assets				37,950
Investment				42,248
Customer relationships				448,800
Tradename				49,799
Accounts payable and accrued expenses				(173,197)
Accrued payroll and related taxes				(325,629)
Accrued duties and taxes				(66,765)
Lease liability				(585,207)
Deferred revenue				(3,618)
Long-term debt				(90,314)
Cash overdraft				(471,017)
Cash				234
Restricted cash				185,399
Total net assets acquired				417,416
Consideration per Share Exchange Agreement				268
Goodwill/(Bargain Purchase Gain)				$ (417,148)
Common stock issued for conversion of long-term debt, related and unrelated parties	224,688
Rohuma, LLC [Member]
Acquisition of Mann:
Accounts receivable	4,179
Prepaid and other current assets	8,943
Fixed assets	4,512
Investment	1,440
Accounts payable and accrued expenses	(58,153)
Accrued duties and taxes	(2,688)
Long-term debt - related parties	(37,776)
Long-term debt	(10,000)
Cash overdraft	(2,980)
Cash	6,027
Total net assets acquired	(86,496)
Consideration per Share Exchange Agreement	3,433,776
Goodwill/(Bargain Purchase Gain)	3,520,272
MIMO Technologies PVT Ltd [Member]
Acquisition of Mann:
Accounts receivable	58,692
Prepaid and other current assets	272,872
Fixed and intangible assets	153,186
Accounts payable and accrued expenses	(708,833)
Accrued payroll and related taxes	(104,750)
Accrued duties and taxes	(28,213)
Long-term debt - related parties	(343,118)
Long-term debt	(236,712)
Comprehensive income	(42,735)
Cash	43,851
Total net assets acquired	(935,760)
Consideration per Share Exchange Agreement	2,063,315
Goodwill/(Bargain Purchase Gain)	$ 2,999,075

XML

ORGANIZATION AND NATURE OF OPERATIONS

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

ORGANIZATION AND NATURE OF OPERATIONS

NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS

TraQiQ, Inc. (along with its wholly owned subsidiaries, referred to herein as the “Company”) was incorporated in the State of California on September 9, 2009 as Thunderclap Entertainment, Inc. On July 14, 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc. On July 19, 2017, the Company entered into a Share Exchange Agreement (“Share Exchange”) with the stockholders of OmniM2M, Inc. (“OmniM2M”) and TraQiQ Solutions, Inc. dba Ci2i Services, Inc. (formerly Ci2i Services, Inc. – amended November 6, 2019) (“Ci2i”) whereby the stockholders of Omni and Ci2i exchanged all of their respective shares, representing 100% ownership in OmniM2M and Ci2i in exchange for 12,000,000 shares of the Company’s common stock, respectively. The OmniM2M Shareholders and the Ci2i Shareholders have each been issued their respective 12,000,000 shares on a pro rata basis based on their respective holdings in OmniM2M and Ci2i in the Share Exchange Agreement. The Share Exchange was accounted for as a reverse merger whereas Ci2i is considered the accounting acquirer and TraQiQ,Inc. is considered the accounting acquiree. For accounting purposes, the acquisition of Omni is recorded at historical cost in accordance with Accounting Standard Codification (“ASC”) 805-50-25-2 as this is considered an acquisition of entities under common control as the management of the Company and Omni control the activities of the respective companies. Prior to the merger with Ci2i and acquisition of Omni, the Company was considered a shell company under Rule 12b-2 of the Exchange Act. On December 1, 2017, The Company entered into a Share Purchase Agreement (the “Share Exchange Agreement”) with Ajay Sikka (“Sikka”), the sole shareholder of Transport IQ, Inc. whereby Sikka agreed to sell all of the shares in TransportIQ, Inc. (“TransportIQ”) in exchange for $18,109, in the form of cancellation of all of the debt of TransportIQ that is owed to the Company. The transaction became effective upon the execution of the Share Exchange Agreement by Sikka and the Company; and Transport IQ, Inc, is now a wholly-owned subsidiary of the Company. Because TransportIQ was commonly controlled and owned, the transaction was recorded at the historical carrying value of TransportIQ’s assets and liabilities.

TraQiQ Solutions, Inc.

This entity was formed about over 15 years ago and has most recently been providing technology solutions, predominantly in the business intelligence and data analytics arenas. The Company has been a vendor to Microsoft for over 10 years and has done work with many Microsoft product and business groups, including Microsoft Azure and Microsoft Media planning. Ci2i has worked closely with customers where a wide variety of analytics solutions were built.

Ci2i’s cloud solutions and analytics services comprise software development, program management, project management, and business analytics services.

TraQiQ Solutions Private Limited

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation (“Mann”). On January 2, 2020, Mann changed its name to TraQiQ Solutions Private Limited (“TRAQ Pvt Ltd”). Pursuant to the Share Exchange Agreement with Mann, the Company acquired 100% of the shares of Mann and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing. This transaction is being recorded as a business combination under ASC 805.

The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately. A total of 419,127 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.

Mann-India Private limited was renamed to TraQiQ Solutions Private Limited shortly after acquisition by TraQiQ Inc.

TRAQ Pvt Ltd. was established in May 2000 and is headquartered in New Delhi, India. TRAQ Pvt Ltd. is a leading software development company which, with the advent of technology, has evolved as a mature and fast-growing company committed to provide reliable and cost-effective software solutions across industries all over the world.

TRAQ Pvt Ltd. has its own experienced team of software developers dedicated towards developing various kinds of customized software.

TraQ Pvt Ltd. has been doing business around the world for over 15 years, with particular emphasis on Latin America and India. The customer list includes large enterprise Finance and Insurance companies across Latin America. The company’s product portfolio has evolved rapidly and now includes enterprise ready solutions for payment processing, mobile wallets, micro lending solutions and digital transformation.

The Company helps businesses in emerging economies leverage the gig/task economy with a three-prong approach:

● Target: We help companies target end-customer requirements, analyze their behaviors and offer them the right product or service at the right time.

● Transact: We facilitate end-customer transactions by providing a full set of fin-tech tools, including multi-tiered e-wallets, a settlement engine, and a workflow tool to enable digital commerce.

● Deliver: We provide cloud-based software solutions to manage delivery networks and, in addition, operate a nation-wide network of task associates who make deliveries and fulfill tasks across the supply chain in India.

With operations concentrated in India, Southeast Asia and Latin America, the Company is capitalizing on such growing trends as customer analytics, digital payments taking the place of traditional banking transactions and last mile delivery using task associates. Through its TraQSuite product, the Company provides an integrated solution for businesses seeking to set up an e-commerce operation with customer identification and targeting, payment systems and delivery. With its Mimo subsidiary, the Company runs a delivery and task network of approximately 14,000 people across India.

Target

From its early uses for recommendations of on-line movie preferences and suggested products for on-line shopping, artificial intelligence has become a powerful tool for driving the transformation of business to digital platforms and facilitating business growth. The Company’s management believes the use and application of artificial intelligence solutions to the retail analytics market will grow rapidly as tech resources using it become more affordable and easily available.

The Company uses artificial intelligence tools to provide business intelligence and data solutions. The Company capitalizes on the desire of customers to be rewarded by helping its B2B clients build loyalty and rewards programs. Many businesses have started offering discounts and rewards to customers each time they use their mobile wallets or buy their product or service as a way to incentivize customers to remain loyal to their brand. Once some retailers begin offering such a program, customers expect it with all of their transactions, and retailers that do not offer such an incentive risk a competitive disadvantage. The Company can help in building a more effective dashboards for AI-based decision-making tools or can build real-time systems that monitor data feeds from customer transactions. The Company’s clients can use insights from this data to improve customer experience, improve their business operations and provide the right target audience for marketing initiatives.

The Company’s Kringle™ tool analyzes the behaviors and transactions of the customers of a business across multiple purchasing channels and delivers real-time intelligence to a business, enabling targeted marketing. Powered by an AI-based e-commerce Intelligence Engine developed over the past seven years by a team of machine learning engineers, data scientists and PHDs, Kringle™ is able to deliver real time, automated one-to-one recommendations and personalized content across all customer touch points.

Transact

Payment methods for goods and services have evolved over thousands of years from barter to precious metal coins to paper money to checks to credit cards and, most recently, to digital currency and payments. Digital payments convert traditional cash transactions to cashless ones using software and other modern technologies. Digital payments create efficiencies and save money, and they also leave a digital trail that protects the users.

The business world has aggressively moved toward digital payments with ACH payments, wire transfers and EDI-based solutions. In the consumer world, where customers have access to digital payment tools such as mobile wallets through financial institutions, their use has evolved from being a niche payment method for consumers who are digitally-savvy to a payment method which is mainstream. The Company views this untapped market for digital payments as an opportunity, both for businesses and financial institutions that want to supply products and services to these customers and for the Company to help businesses satisfy that customer demand.

The Company’s TraQSuite™ product offers an enterprise-ready suite of FinTech tools. TraQSuite enables payment processing, mobile wallets, micro lending solutions and digital transformation solutions. Users can virtually store and use financial assets including G2P, B2P, welfare, salary, cards and micro banking like loans and insurance. Both banked and unbanked end customers can buy products and services and pay with their mobile devices using TraQSuite. The system also allows businesses and their customers to settle their transactions across all wallets, vendors, currencies and geographies.

Deliver

In order to complete a sale, a business must actually deliver its products to its customers, which usually includes the “last mile” to the customer’s physical location. While this has always been significant, the global COVID-19 pandemic has dramatically increased demand for product delivery, turning a valuable additional service into a “must-have” capability for businesses. Last-mile delivery aims to transport or deliver an item to its recipient in the quickest way possible, and customers will often make purchase decisions based on the speed, cost and reliability of delivery of the product.

The traditional approach to last-mile delivery is owning an operational fleet, which poses a high risk and potentially high costs, making it an unattractive solution for all by the largest retailers. Smaller companies often prefer to partner with delivery network carriers (DNCs) to handle the delivery, which allows the retailer to transfer a portion of the risk to one or more DNC providers. DNC providers often adopt a “gig” mindset using short-term independent contractors to make the actual delivery, which allows a DNC provider to transact and operate at a fraction of the cost of retaining and operating a delivery fleet. A “gig” business model uses a flexible work force of short-term, freelance independent contractors fulfilling targeted needs and paid on a per-task basis. This can benefit workers seeking lifestyle flexibility and businesses seeking a workforce sized to meet the needs of the moment.

The Company facilitates last-mile delivery and utilization of the “gig” workforce trend in two important ways – by providing software that allows its business clients to set up and manage last-mile delivery and task-based systems and by actually providing task-worker-based last mile delivery and payment collection systems in a major emerging market where there is no realistic alternative.

TraQSuite’s Last Mile software module provides a distribution platform that allows businesses to set up task-based networks rapidly – facilitating and validating transactions, and tracking and managing task associates. The Last-Mile software module enables a complete distribution engine for the new economy, designed to manage thousands of task associates across multiple geographies to deliver products and services to users while tracking the task associates and providing validation for the transactions. Mobile apps enable data sharing, validation and measurement of customer satisfaction.

In addition, the Company provides actual delivery and task-based services for businesses in one emerging market to solve problems that cannot be conveniently addressed using traditional methods. The Company’s Mimo-Technologies subsidiary runs a network of approximately 14,000 task associates in India. This team was set up by and is managed with the TraQSuite product. In addition to its rapidly growing business making task-based food, alcohol and medicine deliveries, Mimo is now collecting payments on behalf of B2B customers in India. The area of payment collections is especially critical for financial services companies who need to collect money from people without credit cards or a bank accounts. Mimo associates collect monthly payments from entrepreneurs with small microfinance loans for equipment or working capital. Mimo associates also collect payments from subscribers to Railtel, one of the largest broadband infrastructure providers in India that operates a nationwide fiber network running alongside train tracks. Mimo collects a transaction fee for each transaction that is completed. All the task associates are independent contractors who get paid for every task that is completed.

Rohuma, LLC

On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuna members agreed to exchange all of their respective membership interests in Rohuma in exchange for 4,292,220 shares of common stock, of which the first tranche of shares were issued on March 1, 2021 totaling 2,562,277 shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $3,433,776 ($0.80 per share). Rohuma has an Indian affiliate that is owned 99% by Rohuma and 1% by its founding member. Rohuma controls this entity and the 1% ownership by the member is now less than 1% upon acquisition by the Company. This amount is reflected as a non-controlling interest.

Rohuma dba Kringle.ai is a California based software solutions company that enables digital and mobile commerce by providing enterprise class applications that cover loyalty and rewards products, payments, online ordering, distribution logistics for retail and more. Kringle analyzes customers’ omni-channel behaviors and transactions. Using AI for digital commerce, Kringle is able to deliver real time, automated 1:1 recommendations and personalized content across all customer touch points.

Mimo Technologies Private Limited

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 1,367,539 shares of the Company’s common stock. Of these warrants, 820,524 were earned at the date of acquisition, with the remaining 547,015 expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.001 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.

Mimo provides delivery and task worker solutions across India. Mimo works with Banking, Financial, Logistics and Distribution companies, to take their products and services to semi-urban and rural India. Mimo trains the agents in each Product or Service through an online and classroom training platform. The company powers the gig economy task workers throughout the country and provides a very valuable source of employment for young people who may or may not have a high school diploma.

NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS

TraQiQ, Inc. (along with its wholly owned subsidiaries, referred to herein as the “Company”) was incorporated in the State of California on September 9, 2009 as Thunderclap Entertainment, Inc. On July 14, 2017, Thunderclap Entertainment, Inc. changed its name to TraQiQ, Inc. On July 19, 2017, the Company entered into a Share Exchange Agreement (“Share Exchange”) with the stockholders of OmniM2M, Inc. (“OmniM2M”) and TraQiQ Solutions, Inc. dba Ci2i Services, Inc. (formerly Ci2i Services, Inc. – amended November 6, 2019) (“Ci2i”) whereby the stockholders of Omni and Ci2i exchanged all of their respective shares, representing 100% ownership in OmniM2M and Ci2i in exchange for 12,000,000 shares of the Company’s common stock, respectively. The OmniM2M Shareholders and the Ci2i Shareholders have each been issued their respective 12,000,000 shares on a pro rata basis based on their respective holdings in OmniM2M and Ci2i in the Share Exchange Agreement. The Share Exchange was accounted for as a reverse merger whereas Ci2i is considered the accounting acquirer and TraQiQ,Inc. is considered the accounting acquiree. For accounting purposes, the acquisition of Omni is recorded at historical cost in accordance with Accounting Standard Codification (“ASC”) 805-50-25-2 as this is considered an acquisition of entities under common control as the management of the Company and Omni control the activities of the respective companies. Prior to the merger with Ci2i and acquisition of Omni, the Company was considered a shell company under Rule 12b-2 of the Exchange Act. On December 1, 2017, The Company entered into a Share Purchase Agreement (the “Share Exchange Agreement”) with Ajay Sikka (“Sikka”), the sole shareholder of Transport IQ, Inc. whereby Sikka agreed to sell all of the shares in TransportIQ, Inc. (“TransportIQ”) in exchange for $18,109, in the form of cancellation of all of the debt of TransportIQ that is owed to the Company. The transaction became effective upon the execution of the Share Exchange Agreement by Sikka and the Company; and Transport IQ, Inc, is now a wholly-owned subsidiary of the Company. Because TransportIQ was commonly controlled and owned, the transaction was recorded at the historical carrying value of TransportIQ’s assets and liabilities.

TraQiQ Solutions, Inc.

This entity was formed about over 15 years ago and has most recently been providing technology solutions, predominantly in the business intelligence and data analytics arenas. The Company has been a vendor to Microsoft for over 10 years and has done work with many Microsoft product and business groups, including Microsoft Azure and Microsoft Media planning. Ci2i has worked closely with customers where a wide variety of analytics solutions were built.

Ci2i’s cloud solutions and analytics services comprise software development, program management, project management, and business analytics services.

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation (“Mann”). On January 2, 2020, Mann changed its name to TRAQIQ Solutions Private Limited (“TRAQ Pvt Ltd”). Pursuant to the Share Exchange Agreement with Mann, the Company acquired 100% of the shares of Mann and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing. This transaction is being recorded as a business combination under ASC 805.

The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately.

Mann-India Private limited was renamed to TraQiQ Solutions Private Limited shortly after acquisition by TraQiQ Inc.

The warrants that are exercisable in one-year (which were extended to March 31, 2021) and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately.

TRAQ Pvt Ltd. was established in May 2000 and is headquartered in New Delhi, India. TRAQ Pvt Ltd. is a leading software development company which, with the advent of technology, has evolved as a mature and fast-growing company committed to provide reliable and cost-effective software solutions across industries all over the world.

TRAQ Pvt Ltd. has its own experienced team of software developers dedicated towards developing various kinds of customized software.

TraQ Pvt Ltd. has been doing business around the world for over 15 years, with particular emphasis on Latin America and India. The customer list includes large enterprise Finance and Insurance companies across Latin America. The company’s product portfolio has evolved rapidly and now includes enterprise ready solutions for payment processing, mobile wallets, micro lending solutions and digital transformation.

TraQSuite is a distribution platform that allows users to setup task-based networks rapidly – target customers, facilitate/validate transactions, track/manage task workers, manage funds and run the entire distribution network. It includes the following functions:

Targeting

TraQSuite analyzes your customers’ omni-channel behaviors and transactions. Using artificial intelligence technology, the software analyzes online activity and delivers real-time, automated recommendations and personalized content, including such items as personalized, always-updated coupons, funds, tickets and loyalty cards.

Transactions

The digital transactions functions of the software enable users to manage and control finances and virtually store and use financial assets including G2P, B2P, welfare, salary, cards and micro banking like loans and insurance. The software includes back-end payment processing and a front-end digital wallet that allows users with and without bank accounts to buy products and services and pay with their mobile devices, settling transactions across multiple vendors, currencies and locations.

Last mile

The Last-Mile software module is designed to allow logistics and delivery operations to manage large numbers of workers in multiple locations that are delivering products and services to users. It both tracks the task workers and provides validation for the transactions. The mobile applications enable data sharing and validation and also measure customer satisfaction.

Integration

TraQSuite also includes software designed to integrate the TraQSuite tools with existing business software.

Learning

TraQLearn is eLearning software that includes modules and dashboards for students, teachers and administrators and tools to help with targeted learning.

Effective December 31, 2020, Ci2i acquired the net assets of OmniM2M and TransportIQ, and then dissolved those entities in January 2021. The value of those transactions were for the assumed liabilities of Omni and TransportIQ, and no cash was exchanged. These acquisitions did not constitute accounting for discontinued operations under ASC 205 as the two entities were acquired by a subsidiary of the Company and were not disposed of.

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Accounting Policies [Abstract]

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the regulations of the United States Securities and Exchange Commission. The condensed consolidated financial statements and accompanying notes are the representations of the Company’s management, who are responsible for their integrity and objectivity. In their opinion, such financial information includes all adjustments considered necessary for a fair presentation at such date and the operating results and cash flows for such periods.

These condensed consolidated financial statements should be read in conjunction with a reading of the Company’s consolidated financial statements and notes thereto included in Form 10-K filed with the SEC on March 22, 2021. Interim results of operations for the six months ended June 30, 2021 are not necessarily indicative of future results for the full year.

Consolidation

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

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

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

Noncontrolling Interests

In accordance with ASC 810-10-45 Noncontrolling Interests in Consolidated Financial Statements, the Company classifies noncontrolling interests as a component of equity within the consolidated balance sheet. In January 2021, the acquisition of Rohuma resulted in a less than 1% non-controlling interest of the Indian affiliate of that company. In February 2021, the acquisition of Mimo resulted in a less than 1% non-controlling interest of that company.

Use of Estimates

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

Foreign Currency Transactions

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

Reclassification

Certain prior period amounts have been reclassified to conform with current period presentation with no effect on the Company’s net loss, total assets, liabilities equity or cash flows.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and on deposit at banking institutions as well as all highly liquid short-term investments with original maturities of 90 days or less of $137,530 and $29,658 as of June 30, 2021 and December 31, 2020, respectively.

Restricted Cash

The Company’s restricted cash balance consists of time deposits with financial institutions which are valued at cost and approximate fair value. Interest earned on these deposits in included in interest income. The carrying value of our restricted cash at June 30, 2021 and December 31, 2020 was $165,488 and $28,746, respectively. The balances consist of time deposits pledged with financial institutions for a Line of Credit facility taken from Andhra Bank, issuance of overdraft limit.

Accounts Receivable and Concentration of Credit Risk

The Company considers accounts receivable, net of allowance for returns and doubtful accounts, to be fully collectible. The allowance is based on management’s estimate of the overall collectability of accounts receivable, considering historical losses and economic conditions. Based on these same factors, individual accounts are charged off against the allowance when management determines those individual accounts are uncollectible.

Credit extended to customers is generally uncollateralized. Past-due status is based on contractual terms. Management has determined that an allowance of $160,403 and $0 was required for the outstanding accounts receivable as of June 30, 2021 and December 31, 2020, respectively.

Property and Equipment and Long-Lived Assets

Fixed assets are stated at cost. Depreciation on fixed assets are computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years.

FASB Codification Topic 360 “Property, Plant and Equipment” (ASC 360), requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The application of ASC 360 has not materially affected the Company’s reported earnings, financial condition or cash flows.

Intangible assets with definite useful lives are stated at cost less accumulated amortization. Intangible assets represent purchased intangible of TRAQ Pvt Ltd. which includes customer relationships and trademarks. The Company amortizes these intangible assets on a straight-line basis over their estimated useful lives of 15 years. OmniM2M has had and currently does have computer software development underway, however, has determined that the costs associated with this development, currently do not meet the requirements for capitalization under ASC 985-20-25. OmniM2M will continue to monitor the development of such software in relationship to the requirements under the ASC in the future to determine if capitalization is warranted.

The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The adoption of this ASU did not have a material impact on our consolidated financial statements. The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets.

The Company will assess the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable at the time they do have intangible assets. Factors the Company considers to be important which could trigger an impairment review include the following:

1. Significant underperformance relative to expected historical or projected future operating results;

2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and

3. Significant negative industry or economic trends.

When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company will measure any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. Management has determined that no impairment of long-lived assets is required for the periods ended June 30, 2021 and December 31, 2020.

Capitalized Software Costs

In accordance with the relevant FASB accounting guidance regarding the development of software to be sold, leased, or marketed, the Company expenses such costs as they are incurred until technological feasibility has been established, at and after which time these costs are capitalized until the product is available for general release to customers. Once the technological feasibility is established per ASC 985-20, the Company capitalizes costs associated with the acquisition or development of major software for internal and external use in the balance sheet.

Costs incurred to enhance the Company’s software products, after general market release of the services using the products, is expensed in the period they are incurred.

The Company only capitalizes subsequent additions, modifications or upgrades to internally developed software to the extent that such changes allow the software to perform a task it previously did not perform. The Company expenses software maintenance and training costs as incurred. The Company acquired $146,065 in software costs in the Mimo transaction.

Revenue Recognition

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

Professional Service Revenue

TRAQ Pvt Ltd. derives a large part of its revenues from professional and support services, which includes revenue generated from software development projects and associated fees for consulting, implementation, training, and project management provided to customers using their systems. Revenue from arrangements with customers is recognized based on the Company’s satisfaction of distinct performance obligations identified in each agreement, generally at a point in time as discussed in ASC 606. In instances where multiple performance obligations are identified, the Company allocates the transaction price to each performance obligation based on relative selling prices of each distinct product or service, and recognizes revenue related to each performance obligation at the points in time that each performance obligation is satisfied. The Company’s performance obligation includes providing customization of software’s, selling of licenses, where the Company typically satisfies its performance obligations prior to the submission of invoices to the customer for such services. The Company’s performance obligation for consulting and technical support is delivered on as the work is being performed, which is satisfied prior to invoicing.

The Company generally collects payment within 30 to 60 days of completion of the performance obligation and there are no agency relationships.

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

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

TRAQ Pvt Ltd. has deferred the revenue and costs attributable to certain process transition activities with respect to its customers where such activities do not represent the culmination of a separate earnings process. Such revenue and costs are subsequently recognized ratably over the period in which the related services are performed. Further, the deferred costs are limited to the amount of the deferred revenues.

TRAQ Pvt Ltd. has now started offering an integrated solution for supply chain and last mile. This product called “TraQSuite” is now offered in multiple markets as a cloud-based subscription offering. This is a significant improvement from the earlier professional services business.

Software Solution Revenue

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

The following is a summary of revenue for the six months ended June 30, 2021 and 2020, disaggregated by type:

	2021		2020
Professional Services Revenue	$	593,898	$	463,385
Sale of goods		544,793		-
Software Solution Revenue		180,697		57,934
	$	1,319,388	$	521,319

Costs of Services Provided

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

Lease Obligations

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

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately.

Income Taxes

Income taxes are accounted under the asset and liability method. The current charge for income tax expense is calculated in accordance with the relevant tax regulations applicable to entity. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance if, based on available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Uncertain Tax Positions

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

TraQiQ, Inc., TraQiQ Solutions, OmniM2M and TransportIQ file a consolidated income tax return in the U.S. federal tax jurisdiction and various state tax jurisdictions. TRAQ Pvt Ltd. files income tax returns in all India tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed. The India tax returns of TRAQ Pvt Ltd. are subject to examination by the India Income Tax Department and India state taxing authority, generally for 12 months after the relevant tax year, 24 months after the relevant tax year in case transfer pricing provisions are applicable.

Fair Value of Financial Instruments

ASC 825, “Financial Instruments,” requires the Company to disclose estimated fair values for its financial instruments. The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses, stockholder advances, short term financing and convertible debt approximate fair value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.

Fair Value Measurements

ASC 820 “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

These consolidated financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates.

In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management for the respective periods. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, investments, short-term notes payable, accounts payable and accrued expenses.

Derivative Financial Instruments

Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of the convertible instruments are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model we use for determining the fair value of our derivatives are binomial pricing models. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss).

With the issuance of the July 2017 FASB ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features, the Company has chosen the early adopt retroactively the amendments in Part I of the standard whereby fair value derivative liabilities previously recognized were derecognized in the current and comparative periods. Under the amendments included in this update, the Company is no longer required to record changes in fair value during the period of change as a separate component of other income (expense) in the consolidated Statements of Operations.

The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (in Topic 260).

The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.

Under current GAAP, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in Topic 480 is evaluated under the guidance in Topic 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting.

Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date.

The amendments in this Update revise the guidance for instruments with down round features in Subtopic 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in Subtopic 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated.

For entities that present EPS in accordance with Topic 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by the Topic 260 amendments in this Update.

Those amendments in Part I of this Update are a cost savings relative to current GAAP. This is because, assuming the required criteria for equity classification in Subtopic 815-40 are met, an entity that issued such an instrument no longer measures the instrument at fair value at each reporting period (in the case of warrants) or separately accounts for a bifurcated derivative (in the case of convertible instruments) on the basis of the existence of a down round feature. For convertible instruments with embedded conversion options that have down round features, applying specialized guidance such as the model for contingent beneficial conversion features rather than bifurcating an embedded derivative also reduces cost and complexity. Under that specialized guidance, the issuer recognizes the intrinsic value of the feature only when the feature becomes beneficial instead of bifurcating the conversion option and measuring it at fair value each reporting period.

The amendments in Part II of this Update replace the indefinite deferral of certain guidance in Topic 480 with a scope exception. This has the benefit of improving the readability of the Codification and reducing the complexity associated with navigating the guidance in Topic 480.

For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways:

1.	retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective; or
2.	retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.

Earnings (Loss) Per Share of Common Stock

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

Related Party Transactions

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

Retirement Benefits to Employees

Defined Contribution Plan

In India, the employees receive benefits from a provident fund, where the employer and employees each make monthly contributions to the plan at a pre-determined rate to the Regional Provident Fund Commissioner. Employer’s contributions to the fund is charged as an expense in the Statements of Operations.

Defined Benefit Plan

In accordance with the Payment of Gratuity Act, 1972, applicable for Indian companies, TRAQ Pvt Ltd. provides for a lump sum payment to eligible employees, at retirement or termination of employment based on the last drawn salary and years of employment with the Company. Current service costs for defined benefit plans are accrued in the period to which they relate. The liability in respect of defined benefit plans is calculated annually by TRAQ Pvt Ltd. TRAQ Pvt Ltd. records annual amounts relating to its defined benefit plans based on calculations that incorporate various actuarial and other assumptions, including discount rates, mortality, assumed rates of return, compensation increases and turnover rates. TRAQ Pvt Ltd. reserves its assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when it is appropriate to do so. TRAQ Pvt Ltd.’s obligation in respect of the gratuity plan, which is a defined benefit plan, is provided for based on actuarial valuation.

Other Long-Term Employee Benefits

TRAQ Pvt Ltd.’s net obligation in respect of leave encashment is the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is based on the prevailing market yields of Indian government securities at the reporting date that have maturity dates approximating the terms of TRAQ Pvt Ltd.’s obligations. The calculation is performed using the projected unit credit method. Any actuarial gains or losses are recognized.

Investments

The Company’s investments are in debt and equity instruments. These investments are accounted for in accordance with ASC 320 Investments – Debt Securities and ASC 321 Investments – Equity Securities. Interest earned under such investments are included in interest income.

Segment Reporting

For purposes of segment disclosures, two or more operating segments should be grouped only if the segments meet all the requirements of paragraph 280-10-50-11, including the requirements for similar economic characteristics.

As a result, all operating units perform similar services, and approximately 99% of the Company’s revenue is generated from its Indian subsidiary. The Company believes that no segment reporting is required as all remaining operations outside of the Indian subsidiary is immaterial.

Recently Issued Accounting Standards

There were updates recently issued, most of which represent technical corrections to the accounting literature or application to specific industries or transactions that are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

Going Concern

The Company has an accumulated deficit of $6,008,129 and a working capital deficit of $8,120,378, as of June 30, 2021, and a working capital deficit of $2,851,721 as of December 31, 2020. As a result of these factors, management has determined that there is substantial doubt about the Company ability to continue as a going concern.

These consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.

The Company plans to raise additional capital to carry out its business plan. The Company’s ability to raise additional capital through future equity and debt securities issuances is unknown. Obtaining additional financing and the successful development of the Company’s contemplated plan of operations, ultimately, to profitable operations, are necessary for the Company to continue operations.

NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the regulations of the United States Securities and Exchange Commission.

Consolidation

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

Use of Estimates

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

Foreign Currency Transactions

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

Reclassification

Certain prior period amounts have been reclassified to conform with current period presentation with no effect on the Company’s net loss, total assets, liabilities equity or cash flows.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and on deposit at banking institutions as well as all highly liquid short-term investments with original maturities of 90 days or less of $29,658 and $9,094 as of December 31, 2020 and December 31, 2019, respectively.

Restricted Cash

The Company’s restricted cash balance consists of time deposits with financial institutions which are valued at cost and approximate fair value. Interest earned on these deposits in included in interest income. The carrying value of our restricted cash at December 31, 2020 and December 31, 2019 was $28,746 and $182,627, respectively. The balances consist of time deposits pledged with financial institutions for a Line of Credit facility taken from Andhra Bank, issuance of overdraft limit.

Accounts Receivable and Concentration of Credit Risk

The Company considers accounts receivable, net of allowance for returns and doubtful accounts, to be fully collectible. The allowance is based on management’s estimate of the overall collectability of accounts receivable, considering historical losses and economic conditions. Based on these same factors, individual accounts are charged off against the allowance when management determines those individual accounts are uncollectible. Credit extended to customers is generally uncollateralized. Past-due status is based on contractual terms. Management has determined that no allowance was required for the outstanding accounts receivable as of December 31, 2020 and December 31, 2019.

Property and Equipment and Long-Lived Assets

Fixed assets are stated at cost. Depreciation on fixed assets are computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years.

FASB Codification Topic 360 “Property, Plant and Equipment” (ASC 360), requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The application of ASC 360 has not materially affected the Company’s reported earnings, financial condition or cash flows.

Intangible assets with definite useful lives are stated at cost less accumulated amortization. Intangible assets represent purchased intangible of TRAQ Pvt Ltd. which includes customer relationships and trademarks. The Company amortizes these intangible assets on a straight-line basis over their estimated useful lives of 15 years. OmniM2M has had and currently does have computer software development underway, however, has determined that the costs associated with this development, currently do not meet the requirements for capitalization under ASC 985-20-25. OmniM2M will continue to monitor the development of such software in relationship to the requirements under the ASC in the future to determine if capitalization is warranted.

The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The adoption of this ASU did not have a material impact on our consolidated financial statements. The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets.

The Company will assess the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable at the time they do have intangible assets. Factors the Company considers to be important which could trigger an impairment review include the following:

1. Significant underperformance relative to expected historical or projected future operating results;

2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and

3. Significant negative industry or economic trends.

When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company will measure any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. Management has determined that no impairment of long-lived assets is required for the periods ended December 31, 2020 and December 31, 2019.

Capitalized Software Costs

In accordance with the relevant FASB accounting guidance regarding the development of software to be sold, leased, or marketed, the Company expenses such costs as they are incurred until technological feasibility has been established, at and after which time these costs are capitalized until the product is available for general release to customers. Once the technological feasibility is established per ASC 985-20, the Company capitalizes costs associated with the acquisition or development of major software for internal and external use in the balance sheet. Costs incurred to enhance the Company’s software products, after general market release of the services using the products, is expensed in the period they are incurred. The Company only capitalizes subsequent additions, modifications or upgrades to internally developed software to the extent that such changes allow the software to perform a task it previously did not perform. The Company expenses software maintenance and training costs as incurred. The Company has not capitalized any cost for software development for the years ended December 31, 2020 and 2019, respectively. 

Revenue Recognition

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

Professional Service Revenue

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

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

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

TRAQ Pvt Ltd. has deferred the revenue and costs attributable to certain process transition activities with respect to its customers where such activities do not represent the culmination of a separate earnings process. Such revenue and costs are subsequently recognized ratably over the period in which the related services are performed. Further, the deferred costs are limited to the amount of the deferred revenues.

TRAQ Pvt Ltd. has now started offering an integrated solution for supply chain and last mile. This product called “TraQSuite” is now offered in multiple markets as a cloud-based subscription offering. This is a significant improvement from the earlier professional services business.

Software Solution Revenue

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

The following is a summary of revenue for the years ended December 31, 2020 and 2019, disaggregated by type:

	2020		2019
Professional Services Revenue	$	935,214	$	654,374
Software Solution Revenue		74,735		26,358
	$	1,009,949	$	680,732

Costs of Services Provided

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

Lease Obligations

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

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately.

Income Taxes

Income taxes are accounted under the asset and liability method. The current charge for income tax expense is calculated in accordance with the relevant tax regulations applicable to entity. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance if, based on available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Uncertain Tax Positions

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

TraQiQ, Inc., TraQiQ Solutions, OmniM2M and TransportIQ file a consolidated income tax return in the U.S. federal tax jurisdiction and various state tax jurisdictions. TRAQ Pvt Ltd. files income tax returns in all India tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed. The India tax returns of TRAQ Pvt Ltd. are subject to examination by the India Income Tax Department and India state taxing authority, generally for 12 months after the relevant tax year, 24 months after the relevant tax year in case transfer pricing provisions are applicable.

Fair Value of Financial Instruments

ASC 825, “Financial Instruments,” requires the Company to disclose estimated fair values for its financial instruments. The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses, stockholder advances, short term financing and convertible debt approximate fair value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.

Fair Value Measurements

ASC 820 “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

These consolidated financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management for the respective periods. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, investments, short-term notes payable, accounts payable and accrued expenses.

Derivative Financial Instruments

Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of the convertible instruments are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model we use for determining the fair value of our derivatives are binomial pricing models. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss).

With the issuance of the July 2017 FASB ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features, the Company has chosen the early adopt retroactively the amendments in Part I of the standard whereby fair value derivative liabilities previously recognized were derecognized in the current and comparative periods. Under the amendments included in this update, the Company is no longer required to record changes in fair value during the period of change as a separate component of other income (expense) in the consolidated Statements of Operations.

The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (in Topic 260). The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.

Under current GAAP, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in Topic 480 is evaluated under the guidance in Topic 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting. Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date.

The amendments in this Update revise the guidance for instruments with down round features in Subtopic 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in Subtopic 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated.

For entities that present EPS in accordance with Topic 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by the Topic 260 amendments in this Update.

Those amendments in Part I of this Update are a cost savings relative to current GAAP. This is because, assuming the required criteria for equity classification in Subtopic 815-40 are met, an entity that issued such an instrument no longer measures the instrument at fair value at each reporting period (in the case of warrants) or separately accounts for a bifurcated derivative (in the case of convertible instruments) on the basis of the existence of a down round feature. For convertible instruments with embedded conversion options that have down round features, applying specialized guidance such as the model for contingent beneficial conversion features rather than bifurcating an embedded derivative also reduces cost and complexity. Under that specialized guidance, the issuer recognizes the intrinsic value of the feature only when the feature becomes beneficial instead of bifurcating the conversion option and measuring it at fair value each reporting period.

The amendments in Part II of this Update replace the indefinite deferral of certain guidance in Topic 480 with a scope exception. This has the benefit of improving the readability of the Codification and reducing the complexity associated with navigating the guidance in Topic 480.

For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways:

1.	retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective; or
2.	retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.

Earnings (Loss) Per Share of Common Stock

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

Related Party Transactions

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

Retirement Benefits to Employees

Defined Contribution Plan

In India, the employees receive benefits from a provident fund, where the employer and employees each make monthly contributions to the plan at a pre-determined rate to the Regional Provident Fund Commissioner. Employer’s contributions to the fund is charged as an expense in the Statements of Operations.

Defined Benefit Plan

In accordance with the Payment of Gratuity Act, 1972, applicable for Indian companies, TRAQ Pvt Ltd. provides for a lump sum payment to eligible employees, at retirement or termination of employment based on the last drawn salary and years of employment with the Company. Current service costs for defined benefit plans are accrued in the period to which they relate. The liability in respect of defined benefit plans is calculated annually by TRAQ Pvt Ltd. TRAQ Pvt Ltd. records annual amounts relating to its defined benefit plans based on calculations that incorporate various actuarial and other assumptions, including discount rates, mortality, assumed rates of return, compensation increases and turnover rates. TRAQ Pvt Ltd. reserves its assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when it is appropriate to do so. TRAQ Pvt Ltd.’s obligation in respect of the gratuity plan, which is a defined benefit plan, is provided for based on actuarial valuation.

Other Long-Term Employee Benefits

TRAQ Pvt Ltd.’s net obligation in respect of leave encashment is the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is based on the prevailing market yields of Indian government securities at the reporting date that have maturity dates approximating the terms of TRAQ Pvt Ltd.’s obligations. The calculation is performed using the projected unit credit method. Any actuarial gains or losses are recognized.

Investments

The Company’s investments are in debt and equity instruments. These investments are accounted for in accordance with ASC 320 Investments – Debt Securities and ASC 321 Investments – Equity Securities. Interest earned under such investments are included in interest income.

Segment Reporting

For purposes of segment disclosures, two or more operating segments should be grouped only if the segments meet all the requirements of paragraph 280-10-50-11, including the requirements for similar economic characteristics.

As a result, all operating units perform similar services, and approximately 99% of the Company’s revenue is generated from its Indian subsidiary. The Company believes that no segment reporting is required as all remaining operations outside of the Indian subsidiary is immaterial.

Recently Issued Accounting Standards

There were updates recently issued, most of which represent technical corrections to the accounting literature or application to specific industries or transactions that are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

Going Concern

The Company has an accumulated deficit of $2,504,893 and a working capital deficit of $2,851,721, as of December 31, 2020, and a working capital deficit of $2,697,036 as of December 31, 2019. As a result of these factors, management has determined that there is substantial doubt about the Company ability to continue as a going concern.

These consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.

In May 2019, the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company. This acquisition will assist the Company in operations and cash flow.

The Company plans to raise additional capital to carry out its business plan. The Company’s ability to raise additional capital through future equity and debt securities issuances is unknown. Obtaining additional financing and the successful development of the Company’s contemplated plan of operations, ultimately, to profitable operations, are necessary for the Company to continue operations.

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ACQUISITIONS

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Business Combination and Asset Acquisition [Abstract]

ACQUISITIONS

NOTE 3: ACQUISITIONS

TRAQ PVT LTD

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation. On January 2, 2020, the name of this company was changed to TRAQIQ Solutions Private Limited. Pursuant to the Share Exchange Agreement with TRAQ Pvt Ltd., the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities) in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately upon closing; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing.

The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately. A total of 419,127 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.

The Company acquired the assets and liabilities noted below in exchange for the warrants noted herein and accounted for the acquisition in accordance with ASC 805. As a result, total consideration was equal to the value of the warrants of $268, as stated in the agreement, and the Company recognized a gain on bargain purchase in the amount of $417,148.

ROHUMA

On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuna members agreed to exchange all of their respective membership interests in Rohuma in exchange for 4,292,220 shares of common stock, of which the first tranche of shares were issued on March 1, 2021 totaling 2,562,277 shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $3,433,776 ($0.80 per share). Rohuma has an Indian affiliate that is owned 99% by Rohuma and 1% by its founding member. Rohuma controls this entity and the 1% ownership by the member is now less than 1% upon acquisition by the Company. This amount is reflected as a non-controlling interest.

The Company acquired the assets and liabilities noted below in exchange for the shares noted herein and accounted for the acquisition in accordance with ASC 805.

Cash	$	6,027
Accounts receivables, net		4,179
Prepaid expenses and other current assets		8,943
Fixed assets		4,512
Investment		1,440
Accounts payable and accrued expenses		(58,153	)
Accrued duties and taxes		(2,688	)
Cash overdraft		(2,980	)
Debt – related parties		(37,776	)
Debt		(10,000	)
	$	(86,496	)

The difference between the net liabilities acquired of $86,496, and the consideration paid (in the form of shares, inclusive of contingent consideration of $1,383,954) of $3,520,272 represents goodwill.

MIMO TECHNOLOGIES

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 1,367,539 shares of the Company’s common stock. Of these warrants, 820,524 were earned at the date of acquisition, with the remaining 547,015 expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.001 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.

The Company acquired the assets and liabilities noted below in exchange for the warrants noted herein and accounted for the acquisition in accordance with ASC 805.

Cash	$	43,851
Accounts receivables, net		58,692
Prepaid expenses and other current assets		272,872
Fixed and intangible assets		153,186
Accounts payable and accrued expenses		(708,833	)
Accrued payroll and related taxes		(104,750	)
Accrued duties and taxes		(28,213	)
Comprehensive income		(42,735	)
Debt – related parties		(343,118	)
Debt		(236,712	)
	$	(935,760	)

The difference between the net liabilities acquired of $935,760, and the consideration paid (in the form of cash and warrants, net of adjustments for the note payable and accounts payable of Mimo with TRAQ Pvt Ltd) of $2,085,653 represents goodwill in the amount of $3,021,413.

The following table shows pro-forma results for the six months ended June 30, 2021 and 2020 as if the acquisition had occurred on January 1, 2020. These unaudited pro forma results of operations are based on the historical financial statements and related notes of Rohuma, Mimo and the Company.

	For the six months ended June 30, 2021			For the six months ended June 30, 2020
Revenues	$	1,355,350		$	732,415
Net income (loss)	$	(3,555,172	)	$	(488,535	)
Net income (loss) per share	$	(0.12	)	$	(0.02	)

NOTE 3: ACQUISITION OF TRAQ PVT LTD.

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation. On January 2, 2020, the name of this company was changed to TRAQIQ Solutions Private Limited. Pursuant to the Share Exchange Agreement with TRAQ Pvt Ltd., the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities) in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately upon closing; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing.

The warrants that are exercisable in one-year and two-years are conditioned upon TRAQ Pvt Ltd. achieving certain revenue figures and pre-tax profit percentages. TRAQ Pvt Ltd. must achieve target revenue of $1.1 million (US$) and pre-tax profit of 25% (US$). Should TRAQ Pvt Ltd. be unable to achieve these criteria, the warrants will be reduced proportionately.

The Company acquired the assets and liabilities noted below in exchange for the warrants noted herein and accounted for the acquisition in accordance with ASC 805. As a result, total consideration was equal to the value of the warrants of $268, as stated in the agreement, and the Company recognized a gain on bargain purchase in the amount of $417,148. In accordance with ASC 805-20-50-4A, based on the book values which approximate fair values at the effective date of acquisition, the purchase price was recorded as follows:

Cash (including restricted cash of $185,399)	$	185,633
Accounts receivables, net		506,951
Prepaid expenses and other current assets		216,956
Right-of-use asset		576,566
Fixed assets		68,260
Customer relationships		448,800
Tradenames		49,799
Investment		42,248
Other assets		37,950
Accounts payable and accrued expenses		(173,197	)
Accrued payroll and related taxes		(325,629	)
Accrued duties and taxes		(66,765	)
Lease liability		(585,207	)
Deferred revenue		(3,618	)
Cash overdraft		(471,017	)
Debt – related parties		(61,273	)
Debt		(29,041	)
	$	417,416

The customer relationships and tradenames are being amortized over fifteen years.

The difference between the net assets acquired of $417,416, and the consideration paid (in the form of warrants) of $268 represents a bargain purchase gain of $417,148.

The following table shows pro-forma results for the year December 31, 2019 as if the acquisition had occurred on January 1, 2019. These unaudited pro forma results of operations are based on the historical financial statements and related notes of TRAQ Pvt Ltd. and the Company.

	For the year ended December 31, 2019
Revenues	$	1,143,606
Net income (loss)	$	(166,533	)
Net income (loss) per share	$	(0.01	)

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CASH AND RESTRICTED CASH

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Cash and Cash Equivalents [Abstract]

CASH AND RESTRICTED CASH

NOTE 4: CASH AND RESTRICTED CASH

Cash and restricted cash are as follows:

	June 30, 2021		December 31, 2020
Cash on hand	$	109	$	141
Bank balances		137,421		29,517
Restricted cash		165,488		28,746
Total	$	303,018	$	58,404

ASU 2016-18, “Statements of Cash Flows” (Topic 230) was adopted by the Company in 2017. In accordance with this standard, restricted cash and restricted cash equivalents is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the Statements of Cash Flows. During the six months ended June 30, 2021 and the year ended December 31, 2020 there were no cash equivalents.

NOTE 4: CASH AND RESTRICTED CASH

Cash and restricted cash are as follows:

	December 31, 2020		December 31, 2019
Cash on hand	$	141	$	252
Bank balances		29,517		8,842
Restricted cash		28,746		182,627
Total	$	58,404	$	191,721

ASU 2016-18, “Statements of Cash Flows” (Topic 230) was adopted by the Company in 2017. In accordance with this standard, restricted cash and restricted cash equivalents is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the Statements of Cash Flows. During the years ended December 31, 2020 and December 31, 2019, there were no cash equivalents.

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FIXED ASSETS

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Property, Plant and Equipment [Abstract]

FIXED ASSETS

NOTE 5: FIXED ASSETS

The Company’s property and equipment is as follows:

	June 30, 2021			December 31, 2020			Estimated Life
Property and equipment – TRAQ Pvt Ltd.	$	628,026		$	638,587		3 - 10 years
Property and equipment – Rohuma US		1,100			-		3 - 10 years
Property and equipment – Rohuma India		4,117			-		3 – 10 years
Property and Equipment – Mimo Technologies		2,927			-		3 – 10 years
Less: accumulated depreciation		(599,351	)		(602,214	)
Net	$	36,819		$	36,373

Depreciation expense for the six months ended June 30, 2021 and 2020 was $11,615 and $8,186, respectively.

NOTE 5: FIXED ASSETS

The Company’s property and equipment is as follows:

	December 31, 2020			December 31, 2019			Estimated Life
Property and equipment – TRAQ Pvt Ltd.	$	638,587		$	650,621		3 - 10 years
Less: accumulated depreciation		(602,214	)		(601,940	)
Net	$	36,373		$	48,681

Depreciation expense for the years ended December 31, 2020 and 2019 was $14,747 and $22,065, respectively.

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INTANGIBLE ASSETS

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Intangible Assets

INTANGIBLE ASSETS

NOTE 6: INTANGIBLE ASSETS

The Company’s intangible assets are as follows:

	June 30, 2021			December 31, 2020
Customer relationships	$	448,800		$	448,800
Tradenames		49,799			49,799
Software		250,451			-
Less: accumulated amortization		(185,418	)		(54,015	)
Net	$	563,632		$	444,584

Amortization expense for the six months ended June 30, 2021 and 2020 was $25,404 and $16,620, respectively.

NOTE 6: INTANGIBLE ASSETS

The Company’s intangible assets are as follows:

	December 31, 2020			December 31, 2019
Customer relationships	$	448,800		$	448,800
Tradenames		49,799			49,799
Less: accumulated amortization		(54,015	)		(20,775	)
Net	$	444,584		$	477,824

Amortization expense for the years ended December 31, 2020 and 2019 was $33,240 and $20,775, respectively.

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LONG-TERM INVESTMENT

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Investments, All Other Investments [Abstract]

LONG-TERM INVESTMENT

NOTE 8: LONG-TERM INVESTMENT

The Company’s long-term investment is as follows:

	June 30, 2021		December 31, 2020
Equity Security – Compulsorily Convertible Debenture	$	-	$	40,603

The investment the Company had in a 1% Compulsorily Convertible Debenture for the period of seven years were neither to be redeemed by the issuing entity nor are redeemable at the option of the investor, therefore this has been considered an equity security. The Company had elected to measure the equity security at its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The debenture was between TRAQ Pvt Ltd. and Mimo and was forgiven/written-off prior to the acquisition of Mimo on February 16, 2021.

In addition there was an investment acquired in the acquisition of Rohuma US for $1,440.

NOTE 7: LONG-TERM INVESTMENT

The Company’s long-term investment is as follows:

	December 31, 2020		December 31, 2019
Equity Security – Compulsorily Convertible Debenture	$	40,603	$	41,617

The investment the Company has in a 1% Compulsorily Convertible Debenture for the period of seven years are neither to be redeemed by the issuing entity nor are redeemable at the option of the investor, therefore this has been considered an equity security. The Company has elected to measure the equity security at its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer.

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NOTE RECEIVABLE

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Receivables [Abstract]

NOTE RECEIVABLE

NOTE 9: NOTE RECEIVABLE

The Company’s notes receivable is as follows:

	June 30, 2021		December 31, 2020
MIMO Technologies PVT Ltd	$	-	$	227,877

The Company entered into a note receivable with a related party in the amount of 15,037,263 INR (approximately $170,000 US$) dated April 1, 2020 with no stated maturity date. The note bears interest at 13% per annum. Further, the Company provided additional amounts on October 5, 2020, to bring the total outstanding to 16,647,264 INR ($227,877 US$) as of December 31, 2020. Upon the acquisition of Mimo by the Company, the balance of $258,736 in the note receivable was reduced to zero and applied towards the purchase of Mimo.

NOTE 8: NOTE RECEIVABLE

The Company’s notes receivable is as follows:

	December 31, 2020		December 31, 2019
MIMO Technologies PVT Ltd	$	227,877	$	-

The Company entered into a note receivable with a related party in the amount of 15,037,263 INR (approximately $170,000 US$) dated April 1, 2020 with no stated maturity date. The note bears interest at 13% per annum. Further, the Company provided additional amounts on October 5, 2020, to bring the total outstanding to 16,647,264 INR ($227,877 US$) as of December 31, 2020.

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LONG-TERM DEBT RELATED PARTIES

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Long-term Debt Related Parties

LONG-TERM DEBT RELATED PARTIES

NOTE 11: LONG-TERM DEBT RELATED PARTIES

The following is a summary of the current portion - long-term debt - related parties as of June 30, 2021 and December 31, 2020:

		June 30, 2021			December 31, 2020
Unsecured advances - CEO	(a)	$	2,006,691		$	1,718,277
Notes payable - Satinder Thiara	(b)		32,000			57,000
Promissory note – Kunaal Sikka	(c)		15,000			15,000
Notes payable – Swarn Singh	(d)		45,000			45,000
Note payable - Chaudhary	(e)		8,427			8,122
Note payable - Director	(g)		400,000			-
Advances – former CEO of Rohuma			15,141			-
Advances – former CEO of Mimo Technologies	(f)		122,580			-
			2,644,839			1,843,399
Current portion of long-term debt related parties			(2,629,839	)		(1,843,399	)
Long-term debt – related parties		$	15,000		$	-

(a)

This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at 15% annually (1.25% monthly) and are due on demand.

(b)

Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due December 31, 2021, December 13, 2016 ($10,000) which is due December 31, 2021, and May 1, 2018 ($25,000) which matured December 31, 2019 at interest rate of 15% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly). The May 1, 2018 note that matured December 31, 2019 was converted along with $12,392 in accrued interest into 43,990 shares of common stock on March 5, 2021.

(c)	Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on December 31, 2019, and accruing interest at an annual rate of 12%. The note was in default as of December 31, 2019 through June 25, 2021 when the note was extended until December 31, 2022. As a result the interest rate was changed to 18% annually (1.50% monthly) through June 25, 2021 and then changed to 6% annually.
(d)	Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of 15% annually (1.25% monthly). These are unsecured notes. Both notes were due December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).
(e)	Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of 1,100,000 INR (approximately $14,500 US$) due on demand at 13% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,179.
(f)	Note payable to Lathika Regunathan dated June 18, 2021 in the amount of 7,650,000 INR (approximately $100,000 US$) interest free and due on demand.
(g)	Note payable to a director dated June 15, 2021 that matures December 12, 2021 in the amount of $400,000. The note does not bear interest however the director received two tranches of 150,000 shares each for lending this amount. If the note is repaid by the maturity date, one of the two tranches of 150,000 shares will be returned.

Interest expense on these notes for the six months ended June 30, 2021 and 2020 are $158,537 and $107,869, respectively.

NOTE 9: LONG-TERM DEBT RELATED PARTIES

The following is a summary of the current portion - long-term debt - related parties as of December 31, 2020 and December 31, 2019:

		December 31, 2020			December 31, 2019
Unsecured advances - CEO	(a)	$	1,718,277		$	1,221,737
Notes payable - Satinder Thiara	(b)		57,000			57,000
Promissory note – Kunaal Sikka	(c)		15,000			15,000
Notes payable – Swarn Singh	(d)		45,000			45,000
Note payable - Chaudhary	(e)		8,122			-
			1,843,399			1,338,737
Current portion of long-term debt related parties			(1,843,399	)		(1,306,737	)
Long-term debt – related parties		$	-		$	32,000

(a)

This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at 15% annually (1.25% monthly) and are due on demand.

(b)

Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due December 31, 2021, December 13, 2016 ($10,000) which is due December 31, 2021, and May 1, 2018 ($25,000) which matured December 31, 2019 at interest rate of 15% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).

(c)	Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on December 31, 2019, and accruing interest at an annual rate of 12%. The note is in default as of December 31, 2019. As a result the interest rate was changed to 18% annually (1.50% monthly).
(d)	Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of 15% annually (1.25% monthly). These are unsecured notes. Both notes were due December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).
(e)	Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of 1,100,000 INR (approximately $14,500 US$) due on demand at 13% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,179.

Interest expense on these notes for the years ended December 31, 2020 and 2019 are $228,748 and $170,688, respectively.

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LONG-TERM DEBT

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Debt Disclosure [Abstract]

LONG-TERM DEBT

NOTE 12: LONG-TERM DEBT

The following is a summary of the long-term debt as of June 30, 2021 and December 31, 2020:

		June 30, 2021			December 31, 2020
Other debt – in default	(a)	$	6,000		$	6,000
Yukti Securities Private Limited	(b)		-			4,547
Noor Qazi	(c)		-			-
Auto loan – ICICI Bank	(d)		14,769			18,539
Baxter Credit Union	(e)		99,975			99,911
UGECL	(f)		53,960			54,563
USA Bank PPP	(g)		-			10,057
Loan Builder	(h)		47,367			-
Satin			141,097			-
SBA - Rohuma			10,000			-
Total		$	373,168		$	193,617
Current portion			(317,876	)		(133,761	)
Long-term debt, net of current portion		$	55,292		$	59,856

(a)	Note payable to an individual for $7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made a payment of $1,500 against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider.
(b)	Loan payable to Yukti Securities Private Limited is an unsecured loan which is due on demand.
(c)	Unsecured loan from Noor Qazi, individual, is due on demand. Was repaid in December 2020.
(d)	Loan payable with ICICI Bank, secured by the vehicle the loan was taken for. Payments are monthly at $752, through maturity in May 2023. Of the amount outstanding, the following represents the maturity: Current (2021-2022) $7,374; (2022-2023) $7,395.
(e)	Revolving loan in the amount of $100,000 at 4% interest per annum due December 30, 2020. The loan was renegotiated for a balance of $99,911 with similar terms at 4% interest per annum and is guaranteed by the CEO of the Company.
(f)	COVID line of credit from UGECL up to 4,000,000 INR in India, term of 48 months, interest only at 7.5% annual rate for first 12 months, then 36 equal instalments through maturity. Current (2021) $6,063; long-term (2022-2024) $47,897.
(g)	PPP loan from USA Bank, with interest accruing at 1% per annum. Original amount of $34,697 had $24,640 forgiven in December 2020, with the remaining $10,057 due in five years In February 2021, the Company was notified that the entire balance of the PPP loan has been forgiven.
(h)	$50,000 unsecured loan due in 52 weekly payments of $1,057.94 inclusive of interest at approximately 10%.

Interest expense on these notes for the six months ended June 30, 2021 and 2020 are $2,539 and $5,546, respectively.

NOTE 10: LONG-TERM DEBT

The following is a summary of the long-term debt as of December 31, 2020 and December 31, 2019:

		December 31, 2020			December 31, 2019
Promissory notes - Kabbage	(a)	$	-		$	23,826
Promissory notes – Loan Builder	(b)		-			-
Other debt – in default	(c)		6,000			6,000
Yukti Securities Private Limited	(d)		4,547			4,660
Lathika Regunathan	(e)		-			-
Noor Qazi	(f)		-			50,562
Auto loan – ICICI Bank	(g)		18,539			25,662
Baxter Credit Union	(h)		99,911			100,000
UGECL	(i)		54,563			-
USA Bank PPP	(j)		10,057			-
Total		$	193,617		$	210,710
Current portion			(133,761	)		(191,508	)
Long-term debt, net of current portion		$	59,856		$	19,202

(a)	Multiple monthly loan agreements with Kabbage. Each of these loans has a six-month duration with interest and fees spread over the 6 months.
(b)	Business loan agreement with LoanBuilder in August 2018 in the amount of $18,000, payable in 52 weekly payments of $409, including interest.
(c)	Note payable to an individual for $7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made a payment of $1,500 against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider.
(d)	Loan payable to Yukti Securities Private Limited is an unsecured loan which is due on demand.
(e)	Unsecured loan from Lathika Regunathan, individual, is due on demand. Was repaid in 2019.
(f)	Unsecured loan from Noor Qazi, individual, is due on demand. Was repaid in December 2020.
(g)	Loan payable with ICICI Bank, secured by the vehicle the loan was taken for. Payments are monthly at $752, through maturity in May 2023. Of the amount outstanding, the following represents the maturity: Current (2021) $7,183; (2022) $7,837; (2023) $3,519.
(h)	Revolving loan in the amount of $100,000 at 4% interest per annum due December 30, 2020. The loan was renegotiated for a balance of $99,911 with similar terms at 4% interest per annum and is guaranteed by the CEO of the Company.
(i)	COVID line of credit from UGECL up to 4,000,000 INR in India, term of 48 months, interest only at 7.5% annual rate for first 12 months, then 36 equal installments through maturity. Current (2021) $6,063; long-term (2022-2024) $48,500.
(j)	PPP loan from USA Bank, with interest accruing at 1% per annum. Original amount of $34,697 had $24,640 forgiven in December 2020, with the remaining $10,057 due in five years In February 2021, the Company was notified that the entire balance of the PPP loan has been forgiven.

Interest expense on these notes for the years ended December 31, 2020 and 2019 are $6,932 and $12,110, respectively.

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CURRENT PORTION - CONVERTIBLE DEBT – RELATED AND UNRELATED PARTIES

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Current Portion - Convertible Debt Related And Unrelated Parties

CURRENT PORTION - CONVERTIBLE DEBT – RELATED AND UNRELATED PARTIES

NOTE 13: CURRENT PORTION - CONVERTIBLE DEBT – RELATED AND UNRELATED PARTIES

The following is a summary of current portion - convertible debt - related and unrelated parties as of June 30, 2021 and December 31, 2020:

		June 30, 2021		December 31, 2020
Face value of notes – related party	(a)	$	-	$	95,000
Face value of notes – unrelated parties	(a)		68,077		98,077
Excess of the fair value of shares issuable over the face value of the convertible notes	(a)		17,007		48,257
		$	85,084	$	241,334

(a)

In connection with the reverse merger in July 2017, the Company and two stockholders, who had provided related party advances to the Company, agreed to exchange their related party advances for 6% Convertible Promissory Notes that were originally due on January 15, 2018 (the “Notes”) in the amount of $68,077. From August 2017 through November 2017, the Company issued additional notes to four different parties (two of which were related parties) in the principal amount of $100,000 ($70,000 to related parties). In January 2018, the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019. The Notes bear simple interest at 6% unless the Company defaults, which increases the interest rate to 10%. The Holders, at their option, can elect to convert the principal plus any accrued interest, into shares of the Company’s common stock at a conversion rate equal to eighty percent (80%) of the average closing share price as quoted on the OTC Markets for the five (5) trading days prior to the date of conversion. There are two notes that had a maturity date of June 30, 2019, with the remaining notes having a maturity date of December 31, 2019. These notes had not been extended and were in default until June 30, 2021, when the note holders agreed to extend the debt until October 31, 2021, with no other changes to the notes. The Company has classified these notes as current liabilities. The Company had accrued the default interest on the two notes from July 1, 2019 through March 4, 2021. On March 5, 2021, the Company converted $156,250 in convertible notes which includes the excess of the fair value of shares issuable over the face value of the convertible notes along with $31,046 in accrued interest into 187,296 shares of common stock.

During the year ended December 31, 2018, the Company received additional proceeds from a related party of $25,000 (from Dharam V. Sikka, father of CEO) pursuant to a convertible note payable issued in May 2018, with the same interest rate and conversion terms as the Notes described above, initially maturing on December 31, 2018, which has been extended to March 31, 2019 and then again to December 31, 2019. Because the Notes are convertible into a variable number of shares of common stock based on a fixed dollar amount, in accordance with ASC Topic 480-10-50-2, the notes are recorded at the fair value of the shares issuable upon conversion. The excess of the fair value of shares issuable over the face value of the Notes is recorded as a discount to the note to be amortized into interest expense over the term of the note.

Interest expense on these notes for the six months ended June 30, 2021 and 2020 are $5,499 and $9,627, respectively.

The Company has calculated the stock-settled liability in accordance with ASC 835-30 which establishes the monetary value at settlement of these instruments at fair value.

NOTE 11: CURRENT PORTION - CONVERTIBLE DEBT – RELATED AND UNRELATED PARTIES

The following is a summary of current portion - convertible debt - related and unrelated parties as of December 31, 2020 and December 31, 2019:

		December 31, 2020		December 31, 2019
Face value of notes – related party	(a)	$	95,000	$	95,000
Face value of notes – unrelated parties	(a)		98,077		98,077
Excess of the fair value of shares issuable over the face value of the convertible notes	(a)		48,257		48,257
		$	241,334	$	241,334

(a)

In connection with the reverse merger in July 2017, the Company and two stockholders, who had provided related party advances to the Company, agreed to exchange their related party advances for 6% Convertible Promissory Notes that were originally due on January 15, 2018 (the “Notes”) in the amount of $68,077. From August 2017 through November 2017, the Company issued additional notes to four different parties (two of which were related parties) in the principal amount of $100,000 ($70,000 to related parties). In January 2018, the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019. The Notes bear simple interest at 6% unless the Company defaults, which increases the interest rate to 10%. The Holders, at their option, can elect to convert the principal plus any accrued interest, into shares of the Company’s common stock at a conversion rate equal to eighty percent (80%) of the average closing share price as quoted on the OTC Markets for the five (5) trading days prior to the date of conversion. There are two notes that had a maturity date of June 30, 2019, with the remaining notes having a maturity date of December 31, 2019. These notes have not been extended and are currently in default. The Company has classified these notes as current liabilities. The Company has accrued the default interest on the two notes from July 1, 2019 through December 31, 2020.

During the year ended December 31, 2018, the Company received additional proceeds from a related party of $25,000 (from Dharam V. Sikka, father of CEO) pursuant to a convertible note payable issued in May 2018, with the same interest rate and conversion terms as the Notes described above, initially maturing on December 31, 2018, which has been extended to March 31, 2019 and then again to December 31, 2019. Because the Notes are convertible into a variable number of shares of common stock based on a fixed dollar amount, in accordance with ASC Topic 480-10-50-2, the notes are recorded at the fair value of the shares issuable upon conversion. The excess of the fair value of shares issuable over the face value of the Notes is recorded as a discount to the note to be amortized into interest expense over the term of the note.

Interest expense on these notes for the years ended December 31, 2020 and 2019 are $19,361 and $12,957, respectively.

The Company has calculated the stock-settled liability in accordance with ASC 835-30 which establishes the monetary value at settlement of these instruments at fair value.

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STOCKHOLDERS’ EQUITY (DEFICIT)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Equity [Abstract]

STOCKHOLDERS’ EQUITY (DEFICIT)

NOTE 14: STOCKHOLDERS’ EQUITY (DEFICIT)

Series A Convertible Preferred Stock

On July 19, 2017, the Company approved the issuance of 50,000 shares of its Series A Convertible Preferred Stock to its CEO and, on August 1, 2017, the Company sold and issued the 50,000 shares of its Series A Convertible Preferred Stock to its CEO at a price of $0.20 per share for $10,000.

Each outstanding share of Series A Convertible Preferred Stock is convertible into the number of shares of the Company’s common stock (the “Common Stock”) determined by dividing the Stated Value by the Conversion Price as defined below, at the option of any Series A Convertible Preferred Stock shareholder in whole or in part, at any time commencing no earlier than six (6) months after the issuance date; provided that any conversion under this section must be made during the ten (10) day period immediately following the date on which the corporation files with the Securities and Exchange Commission any periodic report on form 10-Q, 10-K or the equivalent form; provided further that, any conversion under this Section IV: (a) shall be for a minimum Stated Value of $500 of Series A Convertible Preferred Stock.

The Conversion Price for each share of Series A Convertible Preferred Stock in effect on any Conversion Date shall be (i) eighty five percent (85%) of the average closing bid price of the Common Stock over the twenty (20) trading days immediately preceding the date of conversion, (ii) but no less than par value of the Common Stock. For purposes of determining the closing bid price on any day, reference shall be to the closing bid price for a share of Common Stock on such date on the OTC Markets, as reported on Bloomberg, L.P. (or similar organization or agency succeeding to its functions of reporting prices) (the “Per Share Market Value”).

Common Stock

As of June 30, 2021, the Company has 31,430,575 shares issued and outstanding.

During the three months ended June 30, 2021, the Company (a) issued 1,000 shares of common stock for services valued at $1,750. In addition, the Company recognized $40,222 in stock-based compensation for restricted stock grants to an advisor that vest over a three-year term. None of the 350,000 shares to this advisor have been issued as of June 30, 2021.; (b) issued 300,000 shares of common stock to a director for agreeing to lend the Company $400,000 in a promissory note. 150,000 of these shares may be returned to the Company should the note be repaid by the maturity date of December 12, 2021. These 300,000 shares have a value of $447,000; and (c) issued 35,000 shares for $38,500.

During the three months ended March 31, 2021, the Company (a) issued 570,000 shares of common stock for $456,000; (b) 264,338 shares of common stock for the conversion for $181,250 in convertible notes and $43,438 in accrued interest; (c) 400,000 shares of common stock for services rendered in the amount of $436,385; and (d) 2,562,277 shares (of a total of 4,292,220 to be issued) for the purchase of Rohuma.

There were no shares issued in the six months ended June 30, 2020.

On April 12, 2018, the Company amended its Articles of Incorporation to forward split all outstanding shares of common stock such that all issued and outstanding shares of Common Stock shall be automatically combined and reclassified such that each share of Pre-Forward Split Stock shall be combined and reclassified into four shares of Common Stock. The number of shares for all periods presented has been retroactively restated to reflect the forward split.

Common Stock Warrants

The following schedule summarizes the changes in the Company’s common stock warrants:

						Weighted				Weighted
	Warrants Outstanding					Average				Average
	Number			Exercise		Remaining		Aggregate		Exercise
	Of			Price		Contractual		Intrinsic		Price
	Shares			Per Share		Life		Value		Per Share
Balance at December 31, 2019		1,329,272		$	0.001		4.87 years	$	-	$	0.001
Warrants granted		-		$	-		-			$
Warrants exercised		-		$	-		-			$
Warrants expired/cancelled		-		$	-		-			$
Balance at December 31, 2020		1,329,272		$	0.001		3.87 years	$	2,125,506	$	0.001
Warrants granted		1,980,039		$	0.001-2.00		-			$
Warrants exercised/exchanged		-		$	-		-			$
Warrants expired/cancelled		(419,127	)	$	-		-			$
Balance at June 30, 2021		2,880,184		$	0.001-2.00		2.72 years	$	3,414,248	$	0.42
Exercisable at June 30, 2021		2,333,168		$	0.001-2.00		2.73 years	$	2,594,272	$	0.52

Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each option/warrant is estimated using the Black-Scholes valuation model. The following assumptions were used for the three months ended March 31, 2021 and year ended December 31, 2020:

	Six Months Ended June 30, 2021			Year Ended December 31, 2020
Expected term		3 years			-
Expected volatility		100-214	%		-
Expected dividend yield		-			-
Risk-free interest rate		0.15-0.58	%		-

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation. Pursuant to the Share Exchange Agreement, the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately upon closing; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing. The value of the transaction totaled $268 and is reflected as an increase to additional paid in capital. A total of 419,127 of these warrants were cancelled effective May 16, 2021 as a result of these criteria not being achieved.

On February 16, 2021, the Company entered into several stock purchase agreements for the issuance of 570,000 shares for cash in the amount of $456,000 (value of $0.80 per share). The individuals also received 285,000 warrants that have a term of three years at an exercise price of $2.00 per share.

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 1,367,539 shares of the Company’s common stock. Of these warrants, 820,524 were earned at the date of acquisition, with the remaining 547,015 expected to be earned over the next two years from grant based on revenue goals for Mimo. The warrants have a term of three years and an exercise price of $0.001 and value in the amount of $1,640,447, of which $984,268 is reflected in additional paid in capital, with the remaining $656,179 reflected as contingent consideration. In addition to the issuance of the warrants, TRAQ Pvt Ltd, wrote off $258,736 in amounts due from a note receivable, $123,778 in accounts receivable and $40,354 in a debenture from Mimo. In addition, a cash payment was made to one of the minority shareholders of Mimo in the amount of $22,338. The Company acquired over 99% of Mimo with the remaining percentage of less than 1% reflected as a non-controlling interest.

On March 8, 2021, the Company entered into a consulting agreement to provide advisory services regarding strategic planning. The agreement is for a term of one-year. The agreement calls for payments to be paid monthly in the amount of $3,000 and the issuance of stock at the commencement of the agreement for 25,000 shares, and a three-year warrant for 100,000 warrants with a strike price of $2.00 per share that vest March 7, 2022.

Options

On November 23, 2020, the Board of Directors of the Company approved the 2020 Equity Incentive Plan.

On October 19, 2020, the Company granted 3,930,000 stock options to board members, advisory board members, employees and consultants. The options have a 10-year term, and are both service based grants, as well as performance-based grants. Stock-based compensation for the year ended December 31, 2020 was $104,638, and the unrecognized stock-based compensation for these grants as of December 31, 2020 is $660,372. Of the 3,930,000 options granted, only 312,500 have been vested through December 31, 2020.

In the six months ended June 30, 2021, the Company recognized $226,807 in stock-based compensation.

The following represents a summary of options:

	Six Months Ended June 30, 2021				Year Ended December 31, 2020
	Number		Weighted Average Exercise Price		Number		Weighted Average Exercise Price
Beginning balance		3,930,000	$	0.0052		-	$	-
Granted		-		-		3,930,000		0.0052
Exercised		-		-		-		-
Forfeited		-		-		-		-
Expired		-		-		-		-
Ending balance		3,930,000	$	0.0052		3,930,000	$	0.0052
Intrinsic value of options	$	5,874,475			$	6,267,475
Weighted Average Remaining Contractual Life (Years)		9.31				9.81

NOTE 12: STOCKHOLDERS’ DEFICIT

Series A Convertible Preferred Stock

On July 19, 2017, the Company approved the issuance of 50,000 shares of its Series A Convertible Preferred Stock to its CEO and, on August 1, 2017, the Company sold and issued the 50,000 shares of its Series A Convertible Preferred Stock to its CEO at a price of $0.20 per share for $10,000.

Each outstanding share of Series A Convertible Preferred Stock is convertible into the number of shares of the Company’s common stock (the “Common Stock”) determined by dividing the Stated Value by the Conversion Price as defined below, at the option of any Series A Convertible Preferred Stock shareholder in whole or in part, at any time commencing no earlier than six (6) months after the issuance date; provided that any conversion under this section must be made during the ten (10) day period immediately following the date on which the corporation files with the Securities and Exchange Commission any periodic report on form 10-Q, 10-K or the equivalent form; provided further that, any conversion under this Section IV: (a) shall be for a minimum Stated Value of $500 of Series A Convertible Preferred Stock.

The Conversion Price for each share of Series A Convertible Preferred Stock in effect on any Conversion Date shall be (i) eighty five percent (85%) of the average closing bid price of the Common Stock over the twenty (20) trading days immediately preceding the date of conversion, (ii) but no less than par value of the Common Stock. For purposes of determining the closing bid price on any day, reference shall be to the closing bid price for a share of Common Stock on such date on the OTC Markets, as reported on Bloomberg, L.P. (or similar organization or agency succeeding to its functions of reporting prices) (the “Per Share Market Value”).

Common Stock

As of December 31, 2020, the Company has 27,297,960 shares issued and outstanding.

On April 12, 2018, the Company amended its Articles of Incorporation to forward split all outstanding shares of common stock such that all issued and outstanding shares of Common Stock shall be automatically combined and reclassified such that each share of Pre-Forward Split Stock shall be combined and reclassified into four shares of Common Stock. The number of shares for all periods presented has been retroactively restated to reflect the forward split.

Warrants

On May 16, 2019, the Company entered into a Share Exchange Agreement with Mann-India Technologies Private Ltd., an Indian Corporation. Pursuant to the Share Exchange Agreement, the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company valued at $268. The warrants will be exercisable as follows: (i) 100,771 warrants immediately upon closing; (ii) 859,951 warrants exercisable one-year after the date of closing, which was extended to March 31, 2021; and (iii) 368,550 warrants exercisable two-years after the date of closing. The value of the transaction totaled $268 and is reflected as an increase to additional paid in capital.

Options

On November 23, 2020, the Board of Directors of the Company approved the 2020 Equity Incentive Plan.

On October 19, 2020, the Company granted 3,930,000 stock options to board members, advisory board members, employees and consultants. The options have a 10-year term, and are both service based grants, as well as performance-based grants. Stock-based compensation for the year ended December 31, 2020 was $104,638, and the unrecognized stock-based compensation for these grants as of December 31, 2020 is $660,372. Of the 3,930,000 options granted, only 312,500 have been vested through December 31, 2020.

The following represents a summary of options as of December 31, 2020 and 2019:

	December 31, 2020				December 31, 2019
	Number		Weighted Average Exercise Price		Number		Weighted Average Exercise Price
Beginning balance		-	$	-		-	$	-
Granted		3,930,000		0.0052		-		-
Exercised		-		-		-		-
Forfeited		-		-		-		-
Expired		-		-		-		-
Ending balance		3,930,000	$	0.0052		-	$	-
Intrinsic value of options	$	6,267,475			$	-
Weighted Average Remaining Contractual Life (Years)		9.81

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OPERATING LEASE

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Operating Lease

OPERATING LEASE

NOTE 15: OPERATING LEASE

The Company has adopted ASU No. 2016-02, Leases (Topic 842), as of January 1, 2019 and will account for their lease in terms of the right of use assets and offsetting lease liability obligations for this new lease under this pronouncement. In accordance with ASC 842 - Leases, effective January 1, 2019, the Company up until May 16, 2019 did not have any long-term lease commitments. On May 17, 2019 with the Company’s acquisition of TRAQ Pvt Ltd., recorded a lease right of use asset and a lease liability at present value of $576,566 and $585,207, respectively. The Company is recording this amount at present value, in accordance with the standard, using an incremental borrowing rate by adjusting the benchmark reference rates with appropriate financing spreads and lease specific adjustments for the effects of collateral. The right of use asset will be composed of the sum of all lease payments plus any initial direct cost and will be straight line amortized over the life of the expected lease term. For the expected term of the lease the Company will use the term of the nine-year lease. This lease will be treated as an operating lease under the new standard.

The Company has chosen to implement this standard using the modified retrospective model approach with a cumulative-effect adjustment, which does not require the Company to adjust the comparative periods presented when transitioning to the new guidance on January 1, 2019. The Company has also elected to utilize the transition related practical expedients permitted by the new standard. The modified retrospective approach provides a method for recording existing leases at adoption and in comparative periods that approximates the results of a modified retrospective approach.

The lease right of use asset of in the original amount of $592,909 was to be amortized on a straight-line basis over the term of the lease.

During the year ended December 31, 2020, the Company renegotiated their leases with the landlord for TRAQ Pvt Ltd. As a result of this renegotiation, the Company vacated one of their two leases, and as a result, impaired $333,571 in right-of-use asset and $349,428 in lease liability.

As of June 30, 2021, the value of the unamortized lease right of use asset is $118,237. As of June 30, 2021, the Company’s lease liability was $127,919.

Remaining Lease Obligation by calendar year (undiscounted cash flows)
2022	$	13,209
2023		28,593
2024		28,593
2025		29,487
2026		32,882
2027		58,914
Total lease payments		191,678
Less: Imputed interest		63,759
Present value of lease liabilities	$	127,919

For the six months ended June 30, 2021 and 2020 the Company recorded rent expense of $15,511 and $63,895.

NOTE 13: OPERATING LEASE

The Company has adopted ASU No. 2016-02, Leases (Topic 842), as of January 1, 2019 and will account for their lease in terms of the right of use assets and offsetting lease liability obligations for this new lease under this pronouncement. In accordance with ASC 842 - Leases, effective January 1, 2019, the Company up until May 16, 2019 did not have any long-term lease commitments. On May 17, 2019 with the Company’s acquisition of TRAQ Pvt Ltd., recorded a lease right of use asset and a lease liability at present value of $576,566 and $585,207, respectively. The Company is recording this amount at present value, in accordance with the standard, using an incremental borrowing rate by adjusting the benchmark reference rates with appropriate financing spreads and lease specific adjustments for the effects of collateral. The right of use asset will be composed of the sum of all lease payments plus any initial direct cost and will be straight line amortized over the life of the expected lease term. For the expected term of the lease the Company will use the term of the nine-year lease. This lease will be treated as an operating lease under the new standard.

The Company has chosen to implement this standard using the modified retrospective model approach with a cumulative-effect adjustment, which does not require the Company to adjust the comparative periods presented when transitioning to the new guidance on January 1, 2019. The Company has also elected to utilize the transition related practical expedients permitted by the new standard. The modified retrospective approach provides a method for recording existing leases at adoption and in comparative periods that approximates the results of a modified retrospective approach.

The lease right of use asset of in the original amount of $592,909 was to be amortized on a straight-line basis over the term of the lease. For the years ended December 31, 2020 and 2019 the Company recorded rent expense of $100,079 and $74,214.

During the year ended December 31, 2020, the Company renegotiated their leases with the landlord for TRAQ Pvt Ltd. As a result of this renegotiation, the Company vacated one of their two leases, and as a result, impaired $333,571 in right-of-use asset and $349,428 in lease liability. The difference has been reflected as forgiveness of debt in the Consolidated Statements of Operations in December 31, 2020.

As of December 31, 2020, the value of the unamortized lease right of use asset is $126,118. As of December 31, 2020, the Company’s lease liability was $133,998.

Remaining Lease Obligation by calendar year (undiscounted cash flows)
2021	$	26,087
2022		29,091
2023		29,091
2024		30,000
2025		33,455
2026 and thereafter		59,940
Total lease payments		207,663
Less: Imputed interest		73,665
Present value of lease liabilities	$	133,998

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CONCENTRATIONS

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Risks and Uncertainties [Abstract]

CONCENTRATIONS

nOTE 17: CONCENTRATIONS

During the six months ended June 30, 2021 and 2020, the Company had two major customers comprising 87% of revenues and two major customers comprising 88% of revenues, respectively. A major customer is defined as a customer that represents 10% or greater of total revenues. There was 87% and 85% of accounts receivable representing two and two customers as of June 30, 2021 and December 31, 2020, respectively.

The Company does not believe that the risk associated with these customers or vendors will have an adverse effect on the business.

nOTE 14: CONCENTRATIONS

During the years ended December 31, 2020 and 2019, the Company had two major customers comprising 85% of revenues and two major customers comprising 82% of revenues, respectively. A major customer is defined as a customer that represents 10% or greater of total revenues. There was 85% and 67% of accounts receivable two and two customers as of December 31, 2020 and December 31, 2019, respectively.

The Company does not believe that the risk associated with these customers or vendors will have an adverse effect on the business.

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CONTINGENCY

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

CONTINGENCY

nOTE 18: CONTINGENCY

During the year ended December 31, 2018, the Company charged an independent truck driver approximately $190,000 pursuant to its agreement with the driver, which entitled the Company to fees equal to $800 per day for the driver’s failure to return a trailer owned by the Company with the period prescribed by the agreement. The Company has not recognized this as income due to uncertainty of payment and will record as other income during the period in which amounts are collected.

nOTE 15: CONTINGENCY

During the year ended December 31, 2018, the Company charged an independent truck driver approximately $190,000 pursuant to its agreement with the driver, which entitled the Company to fees equal to $800 per day for the driver’s failure to return a trailer owned by the Company with the period prescribed by the agreement. The Company has not recognized this as income due to uncertainty of payment and will record as other income during the period in which amounts are collected.

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PROVISION FOR INCOME TAXES

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

PROVISION FOR INCOME TAXES

NOTE 16: PROVISION FOR INCOME TAXES

The provision (benefit) for income taxes for the years ended December 31, 2020 and 2019 differs from the amount which would be expected as a result of applying the statutory tax rates to the losses before income taxes due primarily to the valuation allowance to fully reserve net deferred tax assets.

All United States based entities:

The following table summarizes the significant differences between the U.S. Federal statutory tax rate and the Company’s effective tax rate for financial statement purposes for the years ended December 31, 2020 and 2019:

	2020			2019
Federal income taxes at statutory rate		21.00	%		21.00	%
State income taxes at statutory rate		7.50	%		7.50	%
Temporary differences		0.38	%		(0.82	)%
Permanent differences		(0.98	)%		(7.41	)%
Change in valuation allowance		(27.90	)%		(20.27	)%
Totals		0.00	%		0.00	%

Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carry-forwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance.

	As of			As of
	December 31, 2020			December 31, 2019
Deferred tax assets:
Net operating losses before non-deductible items	$	747,748		$	579,118
Stock-based compensation		28,174			-
Depreciation		(1,616	)		(1,616	)
Total deferred tax assets		774,306			577,502
Less: Valuation allowance		(774,306	)		(577,502	)
Net deferred tax assets	$	-		$	-

As of December 31, 2020, the Company has a net operating loss carry forward of $2,777,151 expiring through 2037. The Company has provided a valuation allowance against the full amount of the deferred tax asset due to management’s uncertainty about its realization. Furthermore, the net operating loss carry forward may be subject to further limitation pursuant to Section 382 of the Internal Revenue Code. The valuation allowance was increased by $196,804 in 2020.

The Company classifies income tax penalties and interest, if any, as part of other general and administrative expenses in the accompanying consolidated statements of operations. The Company did not expense any penalties or interest during the years ended December 31, 2020 or December 31, 2019 and did not accrue any penalties or interest as of December 31, 2020 or December 31, 2019.

India based entity:

Significant components of deferred tax liabilities as at December 31, 2020 and 2019 (was acquired May 2019):

	As of			As of
	December 31, 2020			December 31, 2019
Deferred Tax Assets:
Difference between book and tax base of fixed assets	$	43,868		$	56,696
Provision for gratuity		27,189			22,253
Provision for leave encashment		11,030			8,598
Operating lease		5,170			2,339
NOL carryforward (based on last tax return filed per Indian Income Tax laws)		43,140			11,404
Timing difference on TDS under 40a(ia)		9,002			-
MAT credit		8,644			8,860
Deferred Tax Assets		148,043			110,150
Net Deferred Tax Assets		148,043			110,150
Less: Valuation allowance		(148,043	)		(110,150	)
Net Deferred Tax Asset	$	-		$	-

Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the financial statement carrying values of assets and liabilities and their respective tax bases.

At December 31, 2020, the Company performed an analysis of the deferred tax asset valuation allowance due to management’s uncertainty about its realization. The Company when necessary will record a valuation allowance against this deferred tax asset. Based on the analysis, the Company has provided a valuation allowance against the full amount of said Deferred Tax Assets of $148,043 due to management’s uncertainty about its realization.

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EMPLOYEE BENEFIT PLANS

12 Months Ended

Dec. 31, 2020

Retirement Benefits [Abstract]

EMPLOYEE BENEFIT PLANS

nOTE 17: EMPLOYEE BENEFIT PLANS

TRAQ Pvt Ltd.’s Gratuity Plan provides for lump sum payment to vested employees on retirement or upon termination of employment in an amount based on the respective employee’s salary and years of employment with the Company. Liabilities with regard to the Gratuity Plans are determined by actuarial valuation using the projected unit credit method. Current service costs for the Gratuity Plan are accrued in the year to which they relate. Actuarial gains or losses or prior service costs, if any, resulting from amendments to the plans are recognized and amortized over the remaining period of service of the employees.

The benefit obligation has been measured as of December 31, 2020. The gratuity plan is unfunded. The following table sets forth the activity of the Gratuity Plans and the amounts recognized in the Company’s financial statements for the year ended December 31, 2020:

	Year Ended
	December 31, 2020
Change in projected benefit obligation:
Projected benefit obligation as of January 1, 2020	$	85,594
Service cost		10,746
Interest cost		5,595
Benefits paid		(19,033	)
Actuarial gain (loss) on the Obligation		23,761
Effect of exchange rate changes		(2,090	)
	$	104,573
Projected benefit obligation as of December 31, 2020
Unfunded amount – non-current	$	94,023
Unfunded amount - current		10,550
Total accrued liability	$	104,573
Components of net period benefit costs:
Service cost	$	10,746
Interest cost		5,595
Actuarial gain (loss) on the Obligation		23,761
	$	40,102
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		5.55% per annum
Rate of increase in compensation levels		10.00 % per annum

The benefit obligation has been measured as of December 31, 2019. The gratuity plan is unfunded. The following table sets forth the activity of the Gratuity Plans and the amounts recognized in the Company’s financial statements for the period May 16, 2019 through December 31, 2019:

	Period May 16, 2019 through
	December 31, 2019
Change in projected benefit obligation:
Projected benefit obligation as of May 16, 2019	$	65,550
Service cost		6,982
Interest cost		3,106
Benefits paid		(1,932	)
Actuarial gain (loss) on the Obligation		13,086
Effect of exchange rate changes		(1,198	)
	$	85,594
Projected benefit obligation as of December 31, 2019
Unfunded amount – non-current	$	74,781
Unfunded amount - current		10,813
Total accrued liability	$	85,594
Components of net period benefit costs:
Service cost	$	6,982
Interest cost		3,106
Actuarial gain (loss) on the Obligation		11,888
	$	21,976
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		6.70% per annum
Rate of increase in compensation levels		10.00 % per annum

Leave Encashment:

The other long-term employee benefits has been measured as of December 31, 2020. The following table sets forth the activity of the leave encashment and the amounts recognized in TRAQ Pvt Ltd.’s financial statements at December 31, 2020:

	Year Ended
	December 31, 2020
Change in projected benefit obligation:
Projected benefit obligation as of January 1, 2020	$	33,070
Service cost		10,746
Interest cost		5,595
Benefits paid		(2,212	)
Actuarial gain (loss) on the Obligation		(3,969	)
Effect of exchange rate changes		(806	)
	$	42,424
Projected benefit obligation as of December 31, 2020
Unfunded amount – non-current	$	37,306
Unfunded amount - current		5,118
Total accrued liability	$	42,424
Components of net period benefit costs:
Service cost	$	10,746
Interest cost		5,595
Actuarial gain (loss) on the Obligation		(3,969	)
	$	12,372
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		5.55% per annum
Rate of increase in compensation levels		10.00 % per annum

The other long-term employee benefits has been measured as of December 31, 2019. The following table sets forth the activity of the leave encashment and the amounts recognized in TRAQ Pvt Ltd.’s financial statements at the end of the period May 16, 2019 through December 31, 2019:

	Period May 16, 2019 through
	December 31, 2019
Change in projected benefit obligation:
Projected benefit obligation as of May 16, 2019	$	24,243
Service cost		3,646
Interest cost		940
Benefits paid		(919	)
Actuarial gain (loss) on the Obligation		5,617
Effect of exchange rate changes		(457	)
	$	33,070
Projected benefit obligation as of December 31, 2019
Unfunded amount – non-current	$	27,682
Unfunded amount - current		5,388
Total accrued liability	$	33,070
Components of net period benefit costs:
Service cost	$	3,646
Interest cost		940
Actuarial gain (loss) on the Obligation		5,160
	$	9,746
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		6.70% per annum
Rate of increase in compensation levels		10.00 % per annum

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

nOTE 19: COMMITMENTS AND CONTINGENCIES

Commitments and contingencies in respect of TRAQ Pvt Ltd;

(i)	TRAQ Pvt Ltd had applied for compounding of the TDS liability for the assessment year 2014-2015 and 2015-2016 in accordance with Indian Income Tax Laws. However, no amount payable for tax and penalty was confirmed by the Income Tax Department. Further, TRAQ Pvt Ltd has also defaulted for TDS deducted but not paid in time during assessment years 2016-2017 to 2020-2021. Accordingly, there may be a contingent liability in respect of TDS regarding compounding charges, interest, and penalty which is not quantifiable at present, hence not provided in the Consolidated Financial Statements.
(ii)	TRAQ Pvt Ltd has outstanding Gratuity for $23,971 as of December 31, 2020, towards ex-employees of TRAQ Pvt Ltd; therefore, TRAQ Pvt Ltd is liable for penalty under The Gratuity Act under the Indian Laws and other relevant laws. Since the amount of penalty for default in payment of gratuity is not ascertainable, therefore it is not provided for in the Consolidated Financial Statements. Gratuity of $13,816 has been paid in the month of January 2021.
(iii)	There are numerous interpretative issues relating to the Indian Supreme Court (SC) judgment dated February 28, 2019, on Provident Fund (PF) on the inclusion of allowances for the purpose of PF contribution as well as its applicability. Due to a pending decision on the subject review petition and directions from EPFO, the impact has been recorded in the six months ended June 30, 2021 Consolidated Financial Statements.
(iv)	TRAQ Pvt Ltd has delayed in complying with provisions related to Foreign Direct Investment and Transfer of Shares to Non-resident as per the Master Circulars and notification issued by Reserve Bank of India, therefore, is liable for imposition of penalty. Since the amount of the penalty for the same is not ascertainable, no effect was given in the Consolidated Financial Statements.
(v)	Prior to its acquisition in May 2019, TRAQ Pvt Ltd, had provided a guarantee in favor of State Bank of India for $165,813 on March 22, 2014, for Mira Green Tech Private Limited. The State Bank of India is in process of satisfying whether there is any obligation due by TRAQ Pvt Ltd at this time.

nOTE 18: COMMITMENTS AND CONTINGENCIES

Commitments and contingencies in respect of TRAQ Pvt Ltd;

(i)

TRAQ Pvt Ltd had applied for compounding of the TDS liability for the assessment year 2014-2015 and 2015-2016 in accordance with Indian Income Tax Laws. However, no amount payable for tax and penalty was confirmed by the Income Tax Department. Further, TRAQ Pvt Ltd has also defaulted for TDS deducted but not paid in time during assessment years 2016-2017 to 2020-2021. Accordingly, there may be a contingent liability in respect of TDS regarding compounding charges, interest, and penalty which is not quantifiable at present, hence not provided in the Consolidated Financial Statements.

(ii)

TRAQ Pvt Ltd has outstanding Gratuity for $23,971 as of December 31, 2020, towards ex-employees of TRAQ Pvt Ltd; therefore, TRAQ Pvt Ltd is liable for penalty under The Gratuity Act under the Indian Laws and other relevant laws. Since the amount of penalty for default in payment of gratuity is not ascertainable, therefore it is not provided for in the Consolidated Financial Statements. Gratuity of $13,816 has been paid in the month of January 2021.

(iii)	There are numerous interpretative issues relating to the Indian Supreme Court (SC) judgment dated February 28, 2019, on Provident Fund (PF) on the inclusion of allowances for the purpose of PF contribution as well as its applicability. Due to a pending decision on the subject review petition and directions from EPFO, the impact for the past period, if any, was not ascertainable and consequently no effect was given in the Consolidated Financial Statements.
(iv)	TRAQ Pvt Ltd has delayed in complying with provisions related to Foreign Direct Investment and Transfer of Shares to Non-resident as per the Master Circulars and notification issued by Reserve Bank of India, therefore, is liable for imposition of penalty. Since the amount of the penalty for the same is not ascertainable, no effect was given in the Consolidated Financial Statements.
(v)	Prior to its acquisition in May 2019, TRAQ Pvt Ltd, had provided a guarantee in favor of State Bank of India for $165,813 on March 22, 2014, for Mira Green Tech Private Limited. The State Bank of India is in process of satisfying whether there is any obligation due by TRAQ Pvt Ltd at this time.

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SUBSEQUENT EVENTS

12 Months Ended

Dec. 31, 2020

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

nOTE 19: SUBSEQUENT EVENTS

In January 2021, the Company issued 37,500 shares of common stock valued at $52,500 for services rendered, and in March 2021 the Company issued 61,500 shares of common stock valued at $70,725 for services rendered.

On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the amount of $125,000. The GS Note has a maturity of one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000. The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon achievement of the terms of the GS Note.

On January 22, 2021, the Company entered into a Share Exchange Agreement with Rohuma, LLC, a Delaware limited liability company (“Rohuma”) and its members, whereby the Rohuna members agreed to exchange all of their respective membership interests in Rohuma in exchange for 4,292,220 shares of common stock, of which the first tranche of shares were issued on March 1, 2021 totaling 2,562,277 shares, with the remaining value reflected as contingent consideration until the shares vest at which time they will be issued. The transaction was valued at $4,335,142 ($1.01 per share).

On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”). The Platinum Note has a maturity of one-year. The conversion price of the Platinum Note is the greater of (a) $0.01 or (b) 70% of the lowest closing stock price over the previous 15 trading days. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 200,000 warrants that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections, that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 60,000 shares as a commitment fee.

On February 16, 2021, the Company entered into several stock purchase agreements for the issuance of 570,000 shares for cash in the amount of $456,000 (value of $0.80 per share). The individuals also received 285,000 warrants that have a term of three years at an exercise price of $2.00 per share.

On February 17, 2021, the Company entered into a Share Exchange Agreement with Mimo Technologies Private Ltd., and Indian corporation (“Mimo”) and its shareholders, whereby the Mimo shareholders agreed to exchange all of their respective shares in Mimo in exchange for warrants to purchase 1,367,539 shares of the Company’s common stock. The warrants have a term of three years and an exercise price of $0.001 and cash in the amount of $22,338.

On March 6, the Company converted $181,250 and accrued interest of $43,438 into 264,338 shares of common stock. The conversions were done at fair value. These shares will be issued by the Company in the next few weeks.

On March 8, 2021, the Company entered into a consulting agreement to provide advisory services regarding strategic planning. The agreement is for a term of one-year. The agreement calls for payments to be paid monthly in the amount of $3,000 and the issuance of stock at the commencement of the agreement for 25,000 shares, and a three-year warrant for 100,000 warrants with a strike price of $2.00 per share that vest March 7, 2022.

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GOODWILL

6 Months Ended

Jun. 30, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL

NOTE 7: GOODWILL

The Company’s goodwill consists of the following:

	June 30, 2021		December 31, 2020
Rohuma	$	3,519,869	$	-
Mimo Technologies		2,987,811		-
Net	$	6,507,680	$	-

For the period ended June 30, 2021, there were no indicators of impairment noted.

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CONVERTIBLE NOTES PAYABLE

6 Months Ended

Jun. 30, 2021

Convertible Notes Payable

CONVERTIBLE NOTES PAYABLE

NOTE 10: CONVERTIBLE NOTES PAYABLE

As of June 30, 2021 and December 31, 2020, the Company had the following convertible notes outstanding:

		June 30, 2021			December 31, 2020
GS Capital	(a)	$	105,000		$	-
Platinum Point Capital	(b)		400,000			-
Total Convertible Notes Payable		$	505,000		$	-
Less: Discounts			(176,902	)		-
		$	328,098		$	-

(a)

On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the amount of $125,000. The GS Note has a maturity of one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000. The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon achievement of the terms of the GS Note.

(b)

On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”). The Platinum Note has a maturity of one-year. The conversion price of the Platinum Note is the greater of (a) $0.01 or (b) 70% of the lowest closing stock price over the previous 15 trading days. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 200,000 warrants that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections, that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 60,000 shares as a commitment fee.

Interest expense on these notes for the six months ended June 30, 2021 and 2020 are $21,781 and $0, respectively. Amortization of debt and original issue discounts was $146,966 and $0 for the six months ended June 30, 2021 and 2020, respectively.

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DERIVATIVE LIABILITIES

6 Months Ended

Jun. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE LIABILITIES

NOTE 16: DERIVATIVE LIABILITIES

On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the amount of $125,000. The GS Note has a maturity of one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000. The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon achievement of the terms of the GS Note.

On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”). The Platinum Note has a maturity of one-year. The conversion price of the Platinum Note is the greater of (a) $0.01 or (b) 70% of the lowest closing stock price over the previous 15 trading days. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 200,000 warrants that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections, that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 60,000 shares as a commitment fee.

Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each warrant is estimated using the Black-Scholes valuation model. The following assumptions were used in June 30, 2021 and December 31, 2020:

	Six Months Ended June 30, 2021			Year Ended December 31, 2020
Expected term		1 year			-
Expected volatility		164 - 214	%		-
Expected dividend yield		-			-
Risk-free interest rate		0.15	%		-

The Company’s derivative liabilities are as follows:

	June 30, 2021		December 31, 2020
Fair value of the GS Capital conversion option	$	280,000	$	-
Fair value of the Platinum Point conversion option		1,024,000		-
Fair value of the Platinum Point warrants (200,000 warrants)		206,000		-
	$	1,510,000	$	-

Activity related to the derivative liabilities for the period ended June 30, 2021 is as follows:

Beginning balance as of December 31, 2020	$	-
Issuances of warrants/conversion option – derivative liabilities		313,868
Warrants exchanged for common stock		-
Change in fair value of warrants/conversion option - derivative liabilities		1,196,132
Ending balance as of June 30, 2021	$	1,510,000

There were no derivative liabilities prior to January 2021.

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the regulations of the United States Securities and Exchange Commission. The condensed consolidated financial statements and accompanying notes are the representations of the Company’s management, who are responsible for their integrity and objectivity. In their opinion, such financial information includes all adjustments considered necessary for a fair presentation at such date and the operating results and cash flows for such periods.

These condensed consolidated financial statements should be read in conjunction with a reading of the Company’s consolidated financial statements and notes thereto included in Form 10-K filed with the SEC on March 22, 2021. Interim results of operations for the six months ended June 30, 2021 are not necessarily indicative of future results for the full year.

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the regulations of the United States Securities and Exchange Commission.

Consolidation

Consolidation

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

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

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

Consolidation

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

Use of Estimates

Use of Estimates

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

Use of Estimates

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

Foreign Currency Transactions

Foreign Currency Transactions

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

Foreign Currency Transactions

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

Reclassification

Reclassification

Certain prior period amounts have been reclassified to conform with current period presentation with no effect on the Company’s net loss, total assets, liabilities equity or cash flows.

Reclassification

Certain prior period amounts have been reclassified to conform with current period presentation with no effect on the Company’s net loss, total assets, liabilities equity or cash flows.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and on deposit at banking institutions as well as all highly liquid short-term investments with original maturities of 90 days or less of $137,530 and $29,658 as of June 30, 2021 and December 31, 2020, respectively.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and on deposit at banking institutions as well as all highly liquid short-term investments with original maturities of 90 days or less of $29,658 and $9,094 as of December 31, 2020 and December 31, 2019, respectively.

Restricted Cash

Restricted Cash

The Company’s restricted cash balance consists of time deposits with financial institutions which are valued at cost and approximate fair value. Interest earned on these deposits in included in interest income. The carrying value of our restricted cash at June 30, 2021 and December 31, 2020 was $165,488 and $28,746, respectively. The balances consist of time deposits pledged with financial institutions for a Line of Credit facility taken from Andhra Bank, issuance of overdraft limit.

Restricted Cash

The Company’s restricted cash balance consists of time deposits with financial institutions which are valued at cost and approximate fair value. Interest earned on these deposits in included in interest income. The carrying value of our restricted cash at December 31, 2020 and December 31, 2019 was $28,746 and $182,627, respectively. The balances consist of time deposits pledged with financial institutions for a Line of Credit facility taken from Andhra Bank, issuance of overdraft limit.

Accounts Receivable and Concentration of Credit Risk

Accounts Receivable and Concentration of Credit Risk

The Company considers accounts receivable, net of allowance for returns and doubtful accounts, to be fully collectible. The allowance is based on management’s estimate of the overall collectability of accounts receivable, considering historical losses and economic conditions. Based on these same factors, individual accounts are charged off against the allowance when management determines those individual accounts are uncollectible.

Credit extended to customers is generally uncollateralized. Past-due status is based on contractual terms. Management has determined that an allowance of $160,403 and $0 was required for the outstanding accounts receivable as of June 30, 2021 and December 31, 2020, respectively.

Accounts Receivable and Concentration of Credit Risk

The Company considers accounts receivable, net of allowance for returns and doubtful accounts, to be fully collectible. The allowance is based on management’s estimate of the overall collectability of accounts receivable, considering historical losses and economic conditions. Based on these same factors, individual accounts are charged off against the allowance when management determines those individual accounts are uncollectible. Credit extended to customers is generally uncollateralized. Past-due status is based on contractual terms. Management has determined that no allowance was required for the outstanding accounts receivable as of December 31, 2020 and December 31, 2019.

Property and Equipment and Long-Lived Assets

Property and Equipment and Long-Lived Assets

Fixed assets are stated at cost. Depreciation on fixed assets are computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years.

FASB Codification Topic 360 “Property, Plant and Equipment” (ASC 360), requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The application of ASC 360 has not materially affected the Company’s reported earnings, financial condition or cash flows.

Intangible assets with definite useful lives are stated at cost less accumulated amortization. Intangible assets represent purchased intangible of TRAQ Pvt Ltd. which includes customer relationships and trademarks. The Company amortizes these intangible assets on a straight-line basis over their estimated useful lives of 15 years. OmniM2M has had and currently does have computer software development underway, however, has determined that the costs associated with this development, currently do not meet the requirements for capitalization under ASC 985-20-25. OmniM2M will continue to monitor the development of such software in relationship to the requirements under the ASC in the future to determine if capitalization is warranted.

The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The adoption of this ASU did not have a material impact on our consolidated financial statements. The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets.

The Company will assess the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable at the time they do have intangible assets. Factors the Company considers to be important which could trigger an impairment review include the following:

1. Significant underperformance relative to expected historical or projected future operating results;

2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and

3. Significant negative industry or economic trends.

When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company will measure any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. Management has determined that no impairment of long-lived assets is required for the periods ended June 30, 2021 and December 31, 2020.

Property and Equipment and Long-Lived Assets

Fixed assets are stated at cost. Depreciation on fixed assets are computed using the straight-line method over the estimated useful lives of the assets, which range from three to ten years.

FASB Codification Topic 360 “Property, Plant and Equipment” (ASC 360), requires that long-lived assets and certain identifiable intangibles held and used by an entity be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The application of ASC 360 has not materially affected the Company’s reported earnings, financial condition or cash flows.

Intangible assets with definite useful lives are stated at cost less accumulated amortization. Intangible assets represent purchased intangible of TRAQ Pvt Ltd. which includes customer relationships and trademarks. The Company amortizes these intangible assets on a straight-line basis over their estimated useful lives of 15 years. OmniM2M has had and currently does have computer software development underway, however, has determined that the costs associated with this development, currently do not meet the requirements for capitalization under ASC 985-20-25. OmniM2M will continue to monitor the development of such software in relationship to the requirements under the ASC in the future to determine if capitalization is warranted.

The Company has adopted Accounting Standard Update (“ASU”) 2017-04 Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The adoption of this ASU did not have a material impact on our consolidated financial statements. The Company reviews recoverability of long-lived assets on a periodic basis whenever events and changes in circumstances have occurred which may indicate a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future cash flows from its operations on an undiscounted basis. If such assets are determined to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets.

The Company will assess the impairment of identifiable intangibles whenever events or changes in circumstances indicate that the carrying value may not be recoverable at the time they do have intangible assets. Factors the Company considers to be important which could trigger an impairment review include the following:

1. Significant underperformance relative to expected historical or projected future operating results;

2. Significant changes in the manner of use of the acquired assets or the strategy for the overall business; and

3. Significant negative industry or economic trends.

When the Company determines that the carrying value of intangibles may not be recoverable based upon the existence of one or more of the above indicators of impairment and the carrying value of the asset cannot be recovered from projected undiscounted cash flows, the Company records an impairment charge. The Company will measure any impairment based on a projected discounted cash flow method using a discount rate determined by management to be commensurate with the risk inherent in the current business model. Significant management judgment is required in determining whether an indicator of impairment exists and in projecting cash flows. Management has determined that no impairment of long-lived assets is required for the periods ended December 31, 2020 and December 31, 2019.

Capitalized Software Costs

Capitalized Software Costs

In accordance with the relevant FASB accounting guidance regarding the development of software to be sold, leased, or marketed, the Company expenses such costs as they are incurred until technological feasibility has been established, at and after which time these costs are capitalized until the product is available for general release to customers. Once the technological feasibility is established per ASC 985-20, the Company capitalizes costs associated with the acquisition or development of major software for internal and external use in the balance sheet.

Costs incurred to enhance the Company’s software products, after general market release of the services using the products, is expensed in the period they are incurred.

The Company only capitalizes subsequent additions, modifications or upgrades to internally developed software to the extent that such changes allow the software to perform a task it previously did not perform. The Company expenses software maintenance and training costs as incurred. The Company acquired $146,065 in software costs in the Mimo transaction.

Capitalized Software Costs

In accordance with the relevant FASB accounting guidance regarding the development of software to be sold, leased, or marketed, the Company expenses such costs as they are incurred until technological feasibility has been established, at and after which time these costs are capitalized until the product is available for general release to customers. Once the technological feasibility is established per ASC 985-20, the Company capitalizes costs associated with the acquisition or development of major software for internal and external use in the balance sheet. Costs incurred to enhance the Company’s software products, after general market release of the services using the products, is expensed in the period they are incurred. The Company only capitalizes subsequent additions, modifications or upgrades to internally developed software to the extent that such changes allow the software to perform a task it previously did not perform. The Company expenses software maintenance and training costs as incurred. The Company has not capitalized any cost for software development for the years ended December 31, 2020 and 2019, respectively. 

Revenue Recognition

Revenue Recognition

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

Professional Service Revenue

TRAQ Pvt Ltd. derives a large part of its revenues from professional and support services, which includes revenue generated from software development projects and associated fees for consulting, implementation, training, and project management provided to customers using their systems. Revenue from arrangements with customers is recognized based on the Company’s satisfaction of distinct performance obligations identified in each agreement, generally at a point in time as discussed in ASC 606. In instances where multiple performance obligations are identified, the Company allocates the transaction price to each performance obligation based on relative selling prices of each distinct product or service, and recognizes revenue related to each performance obligation at the points in time that each performance obligation is satisfied. The Company’s performance obligation includes providing customization of software’s, selling of licenses, where the Company typically satisfies its performance obligations prior to the submission of invoices to the customer for such services. The Company’s performance obligation for consulting and technical support is delivered on as the work is being performed, which is satisfied prior to invoicing.

The Company generally collects payment within 30 to 60 days of completion of the performance obligation and there are no agency relationships.

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

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

TRAQ Pvt Ltd. has deferred the revenue and costs attributable to certain process transition activities with respect to its customers where such activities do not represent the culmination of a separate earnings process. Such revenue and costs are subsequently recognized ratably over the period in which the related services are performed. Further, the deferred costs are limited to the amount of the deferred revenues.

TRAQ Pvt Ltd. has now started offering an integrated solution for supply chain and last mile. This product called “TraQSuite” is now offered in multiple markets as a cloud-based subscription offering. This is a significant improvement from the earlier professional services business.

Software Solution Revenue

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

The following is a summary of revenue for the six months ended June 30, 2021 and 2020, disaggregated by type:

	2021		2020
Professional Services Revenue	$	593,898	$	463,385
Sale of goods		544,793		-
Software Solution Revenue		180,697		57,934
	$	1,319,388	$	521,319

Revenue Recognition

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

Professional Service Revenue

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

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

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

TRAQ Pvt Ltd. has deferred the revenue and costs attributable to certain process transition activities with respect to its customers where such activities do not represent the culmination of a separate earnings process. Such revenue and costs are subsequently recognized ratably over the period in which the related services are performed. Further, the deferred costs are limited to the amount of the deferred revenues.

TRAQ Pvt Ltd. has now started offering an integrated solution for supply chain and last mile. This product called “TraQSuite” is now offered in multiple markets as a cloud-based subscription offering. This is a significant improvement from the earlier professional services business.

Software Solution Revenue

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

The following is a summary of revenue for the years ended December 31, 2020 and 2019, disaggregated by type:

	2020		2019
Professional Services Revenue	$	935,214	$	654,374
Software Solution Revenue		74,735		26,358
	$	1,009,949	$	680,732

Costs of Services Provided

Costs of Services Provided

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

Costs of Services Provided

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

Lease Obligations

Lease Obligations

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

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately.

Lease Obligations

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

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For leases in which the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease arrangements is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are accounted for separately.

Income Taxes

Income Taxes

Income taxes are accounted under the asset and liability method. The current charge for income tax expense is calculated in accordance with the relevant tax regulations applicable to entity. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance if, based on available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Income Taxes

Income taxes are accounted under the asset and liability method. The current charge for income tax expense is calculated in accordance with the relevant tax regulations applicable to entity. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are reduced by a valuation allowance if, based on available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Uncertain Tax Positions

Uncertain Tax Positions

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

TraQiQ, Inc., TraQiQ Solutions, OmniM2M and TransportIQ file a consolidated income tax return in the U.S. federal tax jurisdiction and various state tax jurisdictions. TRAQ Pvt Ltd. files income tax returns in all India tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed. The India tax returns of TRAQ Pvt Ltd. are subject to examination by the India Income Tax Department and India state taxing authority, generally for 12 months after the relevant tax year, 24 months after the relevant tax year in case transfer pricing provisions are applicable.

Uncertain Tax Positions

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

TraQiQ, Inc., TraQiQ Solutions, OmniM2M and TransportIQ file a consolidated income tax return in the U.S. federal tax jurisdiction and various state tax jurisdictions. TRAQ Pvt Ltd. files income tax returns in all India tax jurisdictions. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed. The India tax returns of TRAQ Pvt Ltd. are subject to examination by the India Income Tax Department and India state taxing authority, generally for 12 months after the relevant tax year, 24 months after the relevant tax year in case transfer pricing provisions are applicable.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

ASC 825, “Financial Instruments,” requires the Company to disclose estimated fair values for its financial instruments. The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses, stockholder advances, short term financing and convertible debt approximate fair value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.

Fair Value of Financial Instruments

ASC 825, “Financial Instruments,” requires the Company to disclose estimated fair values for its financial instruments. The carrying amount of cash, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses, stockholder advances, short term financing and convertible debt approximate fair value because of the short-term maturity of those instruments. The Company does not utilize derivative instruments.

Fair Value Measurements

Fair Value Measurements

ASC 820 “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

These consolidated financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates.

In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management for the respective periods. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, investments, short-term notes payable, accounts payable and accrued expenses.

Fair Value Measurements

ASC 820 “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

These consolidated financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management for the respective periods. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, investments, short-term notes payable, accounts payable and accrued expenses.

Derivative Financial Instruments

Derivative Financial Instruments

Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of the convertible instruments are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model we use for determining the fair value of our derivatives are binomial pricing models. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss).

With the issuance of the July 2017 FASB ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features, the Company has chosen the early adopt retroactively the amendments in Part I of the standard whereby fair value derivative liabilities previously recognized were derecognized in the current and comparative periods. Under the amendments included in this update, the Company is no longer required to record changes in fair value during the period of change as a separate component of other income (expense) in the consolidated Statements of Operations.

The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (in Topic 260).

The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.

Under current GAAP, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in Topic 480 is evaluated under the guidance in Topic 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting.

Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date.

The amendments in this Update revise the guidance for instruments with down round features in Subtopic 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in Subtopic 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated.

For entities that present EPS in accordance with Topic 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by the Topic 260 amendments in this Update.

Those amendments in Part I of this Update are a cost savings relative to current GAAP. This is because, assuming the required criteria for equity classification in Subtopic 815-40 are met, an entity that issued such an instrument no longer measures the instrument at fair value at each reporting period (in the case of warrants) or separately accounts for a bifurcated derivative (in the case of convertible instruments) on the basis of the existence of a down round feature. For convertible instruments with embedded conversion options that have down round features, applying specialized guidance such as the model for contingent beneficial conversion features rather than bifurcating an embedded derivative also reduces cost and complexity. Under that specialized guidance, the issuer recognizes the intrinsic value of the feature only when the feature becomes beneficial instead of bifurcating the conversion option and measuring it at fair value each reporting period.

The amendments in Part II of this Update replace the indefinite deferral of certain guidance in Topic 480 with a scope exception. This has the benefit of improving the readability of the Codification and reducing the complexity associated with navigating the guidance in Topic 480.

For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways:

1.	retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective; or
2.	retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.

Derivative Financial Instruments

Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of the convertible instruments are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model we use for determining the fair value of our derivatives are binomial pricing models. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss).

With the issuance of the July 2017 FASB ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features, the Company has chosen the early adopt retroactively the amendments in Part I of the standard whereby fair value derivative liabilities previously recognized were derecognized in the current and comparative periods. Under the amendments included in this update, the Company is no longer required to record changes in fair value during the period of change as a separate component of other income (expense) in the consolidated Statements of Operations.

The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (in Topic 260). The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.

Under current GAAP, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in Topic 480 is evaluated under the guidance in Topic 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting. Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date.

The amendments in this Update revise the guidance for instruments with down round features in Subtopic 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in Subtopic 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated.

For entities that present EPS in accordance with Topic 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by the Topic 260 amendments in this Update.

Those amendments in Part I of this Update are a cost savings relative to current GAAP. This is because, assuming the required criteria for equity classification in Subtopic 815-40 are met, an entity that issued such an instrument no longer measures the instrument at fair value at each reporting period (in the case of warrants) or separately accounts for a bifurcated derivative (in the case of convertible instruments) on the basis of the existence of a down round feature. For convertible instruments with embedded conversion options that have down round features, applying specialized guidance such as the model for contingent beneficial conversion features rather than bifurcating an embedded derivative also reduces cost and complexity. Under that specialized guidance, the issuer recognizes the intrinsic value of the feature only when the feature becomes beneficial instead of bifurcating the conversion option and measuring it at fair value each reporting period.

The amendments in Part II of this Update replace the indefinite deferral of certain guidance in Topic 480 with a scope exception. This has the benefit of improving the readability of the Codification and reducing the complexity associated with navigating the guidance in Topic 480.

For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways:

1.	retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective; or
2.	retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.

Earnings (Loss) Per Share of Common Stock

Earnings (Loss) Per Share of Common Stock

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

Earnings (Loss) Per Share of Common Stock

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

Related Party Transactions

Related Party Transactions

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

Related Party Transactions

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

Retirement Benefits to Employees

Retirement Benefits to Employees

Defined Contribution Plan

In India, the employees receive benefits from a provident fund, where the employer and employees each make monthly contributions to the plan at a pre-determined rate to the Regional Provident Fund Commissioner. Employer’s contributions to the fund is charged as an expense in the Statements of Operations.

Defined Benefit Plan

In accordance with the Payment of Gratuity Act, 1972, applicable for Indian companies, TRAQ Pvt Ltd. provides for a lump sum payment to eligible employees, at retirement or termination of employment based on the last drawn salary and years of employment with the Company. Current service costs for defined benefit plans are accrued in the period to which they relate. The liability in respect of defined benefit plans is calculated annually by TRAQ Pvt Ltd. TRAQ Pvt Ltd. records annual amounts relating to its defined benefit plans based on calculations that incorporate various actuarial and other assumptions, including discount rates, mortality, assumed rates of return, compensation increases and turnover rates. TRAQ Pvt Ltd. reserves its assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when it is appropriate to do so. TRAQ Pvt Ltd.’s obligation in respect of the gratuity plan, which is a defined benefit plan, is provided for based on actuarial valuation.

Other Long-Term Employee Benefits

TRAQ Pvt Ltd.’s net obligation in respect of leave encashment is the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is based on the prevailing market yields of Indian government securities at the reporting date that have maturity dates approximating the terms of TRAQ Pvt Ltd.’s obligations. The calculation is performed using the projected unit credit method. Any actuarial gains or losses are recognized.

Retirement Benefits to Employees

Defined Contribution Plan

In India, the employees receive benefits from a provident fund, where the employer and employees each make monthly contributions to the plan at a pre-determined rate to the Regional Provident Fund Commissioner. Employer’s contributions to the fund is charged as an expense in the Statements of Operations.

Defined Benefit Plan

In accordance with the Payment of Gratuity Act, 1972, applicable for Indian companies, TRAQ Pvt Ltd. provides for a lump sum payment to eligible employees, at retirement or termination of employment based on the last drawn salary and years of employment with the Company. Current service costs for defined benefit plans are accrued in the period to which they relate. The liability in respect of defined benefit plans is calculated annually by TRAQ Pvt Ltd. TRAQ Pvt Ltd. records annual amounts relating to its defined benefit plans based on calculations that incorporate various actuarial and other assumptions, including discount rates, mortality, assumed rates of return, compensation increases and turnover rates. TRAQ Pvt Ltd. reserves its assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when it is appropriate to do so. TRAQ Pvt Ltd.’s obligation in respect of the gratuity plan, which is a defined benefit plan, is provided for based on actuarial valuation.

Other Long-Term Employee Benefits

TRAQ Pvt Ltd.’s net obligation in respect of leave encashment is the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is based on the prevailing market yields of Indian government securities at the reporting date that have maturity dates approximating the terms of TRAQ Pvt Ltd.’s obligations. The calculation is performed using the projected unit credit method. Any actuarial gains or losses are recognized.

Investments

Investments

The Company’s investments are in debt and equity instruments. These investments are accounted for in accordance with ASC 320 Investments – Debt Securities and ASC 321 Investments – Equity Securities. Interest earned under such investments are included in interest income.

Investments

The Company’s investments are in debt and equity instruments. These investments are accounted for in accordance with ASC 320 Investments – Debt Securities and ASC 321 Investments – Equity Securities. Interest earned under such investments are included in interest income.

Segment Reporting

Segment Reporting

For purposes of segment disclosures, two or more operating segments should be grouped only if the segments meet all the requirements of paragraph 280-10-50-11, including the requirements for similar economic characteristics.

As a result, all operating units perform similar services, and approximately 99% of the Company’s revenue is generated from its Indian subsidiary. The Company believes that no segment reporting is required as all remaining operations outside of the Indian subsidiary is immaterial.

Segment Reporting

For purposes of segment disclosures, two or more operating segments should be grouped only if the segments meet all the requirements of paragraph 280-10-50-11, including the requirements for similar economic characteristics.

As a result, all operating units perform similar services, and approximately 99% of the Company’s revenue is generated from its Indian subsidiary. The Company believes that no segment reporting is required as all remaining operations outside of the Indian subsidiary is immaterial.

Recently Issued Accounting Standards

Recently Issued Accounting Standards

There were updates recently issued, most of which represent technical corrections to the accounting literature or application to specific industries or transactions that are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

Recently Issued Accounting Standards

There were updates recently issued, most of which represent technical corrections to the accounting literature or application to specific industries or transactions that are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

Going Concern

Going Concern

The Company has an accumulated deficit of $6,008,129 and a working capital deficit of $8,120,378, as of June 30, 2021, and a working capital deficit of $2,851,721 as of December 31, 2020. As a result of these factors, management has determined that there is substantial doubt about the Company ability to continue as a going concern.

These consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.

The Company plans to raise additional capital to carry out its business plan. The Company’s ability to raise additional capital through future equity and debt securities issuances is unknown. Obtaining additional financing and the successful development of the Company’s contemplated plan of operations, ultimately, to profitable operations, are necessary for the Company to continue operations.

Going Concern

The Company has an accumulated deficit of $2,504,893 and a working capital deficit of $2,851,721, as of December 31, 2020, and a working capital deficit of $2,697,036 as of December 31, 2019. As a result of these factors, management has determined that there is substantial doubt about the Company ability to continue as a going concern.

These consolidated financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable period. The consolidated financial statements of the Company do not include any adjustments that may result from the outcome of the uncertainties.

In May 2019, the Company acquired 100% of the shares of TRAQ Pvt Ltd. and assumed certain net liabilities in exchange for warrants exercisable over a five-years to purchase 1,329,272 shares of common stock of the Company. This acquisition will assist the Company in operations and cash flow.

The Company plans to raise additional capital to carry out its business plan. The Company’s ability to raise additional capital through future equity and debt securities issuances is unknown. Obtaining additional financing and the successful development of the Company’s contemplated plan of operations, ultimately, to profitable operations, are necessary for the Company to continue operations.

Noncontrolling Interests

Noncontrolling Interests

In accordance with ASC 810-10-45 Noncontrolling Interests in Consolidated Financial Statements, the Company classifies noncontrolling interests as a component of equity within the consolidated balance sheet. In January 2021, the acquisition of Rohuma resulted in a less than 1% non-controlling interest of the Indian affiliate of that company. In February 2021, the acquisition of Mimo resulted in a less than 1% non-controlling interest of that company.

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Accounting Policies [Abstract]

SUMMARY OF DISAGGREGATION OF REVENUE

The following is a summary of revenue for the six months ended June 30, 2021 and 2020, disaggregated by type:

	2021		2020
Professional Services Revenue	$	593,898	$	463,385
Sale of goods		544,793		-
Software Solution Revenue		180,697		57,934
	$	1,319,388	$	521,319

The following is a summary of revenue for the years ended December 31, 2020 and 2019, disaggregated by type:

	2020		2019
Professional Services Revenue	$	935,214	$	654,374
Software Solution Revenue		74,735		26,358
	$	1,009,949	$	680,732

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ACQUISITIONS (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Business Acquisition [Line Items]

SCHEDULE OF BUSINESS ACQUISITION

Cash (including restricted cash of $185,399)	$	185,633
Accounts receivables, net		506,951
Prepaid expenses and other current assets		216,956
Right-of-use asset		576,566
Fixed assets		68,260
Customer relationships		448,800
Tradenames		49,799
Investment		42,248
Other assets		37,950
Accounts payable and accrued expenses		(173,197	)
Accrued payroll and related taxes		(325,629	)
Accrued duties and taxes		(66,765	)
Lease liability		(585,207	)
Deferred revenue		(3,618	)
Cash overdraft		(471,017	)
Debt – related parties		(61,273	)
Debt		(29,041	)
	$	417,416

SCHEDULE OF PROFORMA FOR BUSINESS ACQUISITION

	For the six months ended June 30, 2021			For the six months ended June 30, 2020
Revenues	$	1,355,350		$	732,415
Net income (loss)	$	(3,555,172	)	$	(488,535	)
Net income (loss) per share	$	(0.12	)	$	(0.02	)

The following table shows pro-forma results for the year December 31, 2019 as if the acquisition had occurred on January 1, 2019. These unaudited pro forma results of operations are based on the historical financial statements and related notes of TRAQ Pvt Ltd. and the Company.

	For the year ended December 31, 2019
Revenues	$	1,143,606
Net income (loss)	$	(166,533	)
Net income (loss) per share	$	(0.01	)

Rohuma, LLC [Member]

Business Acquisition [Line Items]

SCHEDULE OF BUSINESS ACQUISITION

Cash	$	6,027
Accounts receivables, net		4,179
Prepaid expenses and other current assets		8,943
Fixed assets		4,512
Investment		1,440
Accounts payable and accrued expenses		(58,153	)
Accrued duties and taxes		(2,688	)
Cash overdraft		(2,980	)
Debt – related parties		(37,776	)
Debt		(10,000	)
	$	(86,496	)

MIMO Technologies PVT Ltd [Member]

Business Acquisition [Line Items]

SCHEDULE OF BUSINESS ACQUISITION

Cash	$	43,851
Accounts receivables, net		58,692
Prepaid expenses and other current assets		272,872
Fixed and intangible assets		153,186
Accounts payable and accrued expenses		(708,833	)
Accrued payroll and related taxes		(104,750	)
Accrued duties and taxes		(28,213	)
Comprehensive income		(42,735	)
Debt – related parties		(343,118	)
Debt		(236,712	)
	$	(935,760	)

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CASH AND RESTRICTED CASH (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Cash and Cash Equivalents [Abstract]

SCHEDULE OF CASH AND RESTRICTED CASH

	June 30, 2021		December 31, 2020
Cash on hand	$	109	$	141
Bank balances		137,421		29,517
Restricted cash		165,488		28,746
Total	$	303,018	$	58,404

Cash and restricted cash are as follows:

	December 31, 2020		December 31, 2019
Cash on hand	$	141	$	252
Bank balances		29,517		8,842
Restricted cash		28,746		182,627
Total	$	58,404	$	191,721

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FIXED ASSETS (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Property, Plant and Equipment [Abstract]

SCHEDULE OF PROPERTY AND EQUIPMENT

	June 30, 2021			December 31, 2020			Estimated Life
Property and equipment – TRAQ Pvt Ltd.	$	628,026		$	638,587		3 - 10 years
Property and equipment – Rohuma US		1,100			-		3 - 10 years
Property and equipment – Rohuma India		4,117			-		3 – 10 years
Property and Equipment – Mimo Technologies		2,927			-		3 – 10 years
Less: accumulated depreciation		(599,351	)		(602,214	)
Net	$	36,819		$	36,373

The Company’s property and equipment is as follows:

	December 31, 2020			December 31, 2019			Estimated Life
Property and equipment – TRAQ Pvt Ltd.	$	638,587		$	650,621		3 - 10 years
Less: accumulated depreciation		(602,214	)		(601,940	)
Net	$	36,373		$	48,681

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INTANGIBLE ASSETS (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Intangible Assets

SCHEDULE OF INTANGIBLE ASSETS

	June 30, 2021			December 31, 2020
Customer relationships	$	448,800		$	448,800
Tradenames		49,799			49,799
Software		250,451			-
Less: accumulated amortization		(185,418	)		(54,015	)
Net	$	563,632		$	444,584

The Company’s intangible assets are as follows:

	December 31, 2020			December 31, 2019
Customer relationships	$	448,800		$	448,800
Tradenames		49,799			49,799
Less: accumulated amortization		(54,015	)		(20,775	)
Net	$	444,584		$	477,824

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LONG-TERM INVESTMENT (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Investments, All Other Investments [Abstract]

SCHEDULE OF LONG-TERM INVESTMENT

The Company’s long-term investment is as follows:

	June 30, 2021		December 31, 2020
Equity Security – Compulsorily Convertible Debenture	$	-	$	40,603

The Company’s long-term investment is as follows:

	December 31, 2020		December 31, 2019
Equity Security – Compulsorily Convertible Debenture	$	40,603	$	41,617

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NOTE RECEIVABLE (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Receivables [Abstract]

SCHEDULE OF NOTE RECEIVABLE

The Company’s notes receivable is as follows:

	June 30, 2021		December 31, 2020
MIMO Technologies PVT Ltd	$	-	$	227,877

The Company’s notes receivable is as follows:

	December 31, 2020		December 31, 2019
MIMO Technologies PVT Ltd	$	227,877	$	-

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LONG-TERM DEBT RELATED PARTIES (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Long-term Debt Related Parties

SCHEDULE OF LONG-TERM DEBT RELATED PARTIES

The following is a summary of the current portion - long-term debt - related parties as of June 30, 2021 and December 31, 2020:

		June 30, 2021			December 31, 2020
Unsecured advances - CEO	(a)	$	2,006,691		$	1,718,277
Notes payable - Satinder Thiara	(b)		32,000			57,000
Promissory note – Kunaal Sikka	(c)		15,000			15,000
Notes payable – Swarn Singh	(d)		45,000			45,000
Note payable - Chaudhary	(e)		8,427			8,122
Note payable - Director	(g)		400,000			-
Advances – former CEO of Rohuma			15,141			-
Advances – former CEO of Mimo Technologies	(f)		122,580			-
			2,644,839			1,843,399
Current portion of long-term debt related parties			(2,629,839	)		(1,843,399	)
Long-term debt – related parties		$	15,000		$	-

(a)

This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at 15% annually (1.25% monthly) and are due on demand.

(b)

Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due December 31, 2021, December 13, 2016 ($10,000) which is due December 31, 2021, and May 1, 2018 ($25,000) which matured December 31, 2019 at interest rate of 15% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly). The May 1, 2018 note that matured December 31, 2019 was converted along with $12,392 in accrued interest into 43,990 shares of common stock on March 5, 2021.

(c)	Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on December 31, 2019, and accruing interest at an annual rate of 12%. The note was in default as of December 31, 2019 through June 25, 2021 when the note was extended until December 31, 2022. As a result the interest rate was changed to 18% annually (1.50% monthly) through June 25, 2021 and then changed to 6% annually.
(d)	Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of 15% annually (1.25% monthly). These are unsecured notes. Both notes were due December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).
(e)	Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of 1,100,000 INR (approximately $14,500 US$) due on demand at 13% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,179.
(f)	Note payable to Lathika Regunathan dated June 18, 2021 in the amount of 7,650,000 INR (approximately $100,000 US$) interest free and due on demand.
(g)	Note payable to a director dated June 15, 2021 that matures December 12, 2021 in the amount of $400,000. The note does not bear interest however the director received two tranches of 150,000 shares each for lending this amount. If the note is repaid by the maturity date, one of the two tranches of 150,000 shares will be returned.

The following is a summary of the current portion - long-term debt - related parties as of December 31, 2020 and December 31, 2019:

		December 31, 2020			December 31, 2019
Unsecured advances - CEO	(a)	$	1,718,277		$	1,221,737
Notes payable - Satinder Thiara	(b)		57,000			57,000
Promissory note – Kunaal Sikka	(c)		15,000			15,000
Notes payable – Swarn Singh	(d)		45,000			45,000
Note payable - Chaudhary	(e)		8,122			-
			1,843,399			1,338,737
Current portion of long-term debt related parties			(1,843,399	)		(1,306,737	)
Long-term debt – related parties		$	-		$	32,000

(a)

This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at 15% annually (1.25% monthly) and are due on demand.

(b)

Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due December 31, 2021, December 13, 2016 ($10,000) which is due December 31, 2021, and May 1, 2018 ($25,000) which matured December 31, 2019 at interest rate of 15% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).

(c)	Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on December 31, 2019, and accruing interest at an annual rate of 12%. The note is in default as of December 31, 2019. As a result the interest rate was changed to 18% annually (1.50% monthly).
(d)	Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of 15% annually (1.25% monthly). These are unsecured notes. Both notes were due December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).
(e)	Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of 1,100,000 INR (approximately $14,500 US$) due on demand at 13% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,179.

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LONG-TERM DEBT (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Debt Disclosure [Abstract]

SCHEDULE OF LONG-TERM DEBT

The following is a summary of the long-term debt as of June 30, 2021 and December 31, 2020:

		June 30, 2021			December 31, 2020
Other debt – in default	(a)	$	6,000		$	6,000
Yukti Securities Private Limited	(b)		-			4,547
Noor Qazi	(c)		-			-
Auto loan – ICICI Bank	(d)		14,769			18,539
Baxter Credit Union	(e)		99,975			99,911
UGECL	(f)		53,960			54,563
USA Bank PPP	(g)		-			10,057
Loan Builder	(h)		47,367			-
Satin			141,097			-
SBA - Rohuma			10,000			-
Total		$	373,168		$	193,617
Current portion			(317,876	)		(133,761	)
Long-term debt, net of current portion		$	55,292		$	59,856

(a)	Note payable to an individual for $7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made a payment of $1,500 against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider.
(b)	Loan payable to Yukti Securities Private Limited is an unsecured loan which is due on demand.
(c)	Unsecured loan from Noor Qazi, individual, is due on demand. Was repaid in December 2020.
(d)	Loan payable with ICICI Bank, secured by the vehicle the loan was taken for. Payments are monthly at $752, through maturity in May 2023. Of the amount outstanding, the following represents the maturity: Current (2021-2022) $7,374; (2022-2023) $7,395.
(e)	Revolving loan in the amount of $100,000 at 4% interest per annum due December 30, 2020. The loan was renegotiated for a balance of $99,911 with similar terms at 4% interest per annum and is guaranteed by the CEO of the Company.
(f)	COVID line of credit from UGECL up to 4,000,000 INR in India, term of 48 months, interest only at 7.5% annual rate for first 12 months, then 36 equal instalments through maturity. Current (2021) $6,063; long-term (2022-2024) $47,897.
(g)	PPP loan from USA Bank, with interest accruing at 1% per annum. Original amount of $34,697 had $24,640 forgiven in December 2020, with the remaining $10,057 due in five years In February 2021, the Company was notified that the entire balance of the PPP loan has been forgiven.
(h)	$50,000 unsecured loan due in 52 weekly payments of $1,057.94 inclusive of interest at approximately 10%.

The following is a summary of the long-term debt as of December 31, 2020 and December 31, 2019:

		December 31, 2020			December 31, 2019
Promissory notes - Kabbage	(a)	$	-		$	23,826
Promissory notes – Loan Builder	(b)		-			-
Other debt – in default	(c)		6,000			6,000
Yukti Securities Private Limited	(d)		4,547			4,660
Lathika Regunathan	(e)		-			-
Noor Qazi	(f)		-			50,562
Auto loan – ICICI Bank	(g)		18,539			25,662
Baxter Credit Union	(h)		99,911			100,000
UGECL	(i)		54,563			-
USA Bank PPP	(j)		10,057			-
Total		$	193,617		$	210,710
Current portion			(133,761	)		(191,508	)
Long-term debt, net of current portion		$	59,856		$	19,202

(a)	Multiple monthly loan agreements with Kabbage. Each of these loans has a six-month duration with interest and fees spread over the 6 months.
(b)	Business loan agreement with LoanBuilder in August 2018 in the amount of $18,000, payable in 52 weekly payments of $409, including interest.
(c)	Note payable to an individual for $7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made a payment of $1,500 against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider.
(d)	Loan payable to Yukti Securities Private Limited is an unsecured loan which is due on demand.
(e)	Unsecured loan from Lathika Regunathan, individual, is due on demand. Was repaid in 2019.
(f)	Unsecured loan from Noor Qazi, individual, is due on demand. Was repaid in December 2020.
(g)	Loan payable with ICICI Bank, secured by the vehicle the loan was taken for. Payments are monthly at $752, through maturity in May 2023. Of the amount outstanding, the following represents the maturity: Current (2021) $7,183; (2022) $7,837; (2023) $3,519.
(h)	Revolving loan in the amount of $100,000 at 4% interest per annum due December 30, 2020. The loan was renegotiated for a balance of $99,911 with similar terms at 4% interest per annum and is guaranteed by the CEO of the Company.
(i)	COVID line of credit from UGECL up to 4,000,000 INR in India, term of 48 months, interest only at 7.5% annual rate for first 12 months, then 36 equal installments through maturity. Current (2021) $6,063; long-term (2022-2024) $48,500.
(j)	PPP loan from USA Bank, with interest accruing at 1% per annum. Original amount of $34,697 had $24,640 forgiven in December 2020, with the remaining $10,057 due in five years In February 2021, the Company was notified that the entire balance of the PPP loan has been forgiven.

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CURRENT PORTION - CONVERTIBLE DEBT – RELATED AND UNRELATED PARTIES (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Current Portion - Convertible Debt Related And Unrelated Parties

SUMMARY OF CARRYING VALUE OF CONVERTIBLE DEBT

The following is a summary of current portion - convertible debt - related and unrelated parties as of June 30, 2021 and December 31, 2020:

		June 30, 2021		December 31, 2020
Face value of notes – related party	(a)	$	-	$	95,000
Face value of notes – unrelated parties	(a)		68,077		98,077
Excess of the fair value of shares issuable over the face value of the convertible notes	(a)		17,007		48,257
		$	85,084	$	241,334

(a)

In connection with the reverse merger in July 2017, the Company and two stockholders, who had provided related party advances to the Company, agreed to exchange their related party advances for 6% Convertible Promissory Notes that were originally due on January 15, 2018 (the “Notes”) in the amount of $68,077. From August 2017 through November 2017, the Company issued additional notes to four different parties (two of which were related parties) in the principal amount of $100,000 ($70,000 to related parties). In January 2018, the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019. The Notes bear simple interest at 6% unless the Company defaults, which increases the interest rate to 10%. The Holders, at their option, can elect to convert the principal plus any accrued interest, into shares of the Company’s common stock at a conversion rate equal to eighty percent (80%) of the average closing share price as quoted on the OTC Markets for the five (5) trading days prior to the date of conversion. There are two notes that had a maturity date of June 30, 2019, with the remaining notes having a maturity date of December 31, 2019. These notes had not been extended and were in default until June 30, 2021, when the note holders agreed to extend the debt until October 31, 2021, with no other changes to the notes. The Company has classified these notes as current liabilities. The Company had accrued the default interest on the two notes from July 1, 2019 through March 4, 2021. On March 5, 2021, the Company converted $156,250 in convertible notes which includes the excess of the fair value of shares issuable over the face value of the convertible notes along with $31,046 in accrued interest into 187,296 shares of common stock.

During the year ended December 31, 2018, the Company received additional proceeds from a related party of $25,000 (from Dharam V. Sikka, father of CEO) pursuant to a convertible note payable issued in May 2018, with the same interest rate and conversion terms as the Notes described above, initially maturing on December 31, 2018, which has been extended to March 31, 2019 and then again to December 31, 2019. Because the Notes are convertible into a variable number of shares of common stock based on a fixed dollar amount, in accordance with ASC Topic 480-10-50-2, the notes are recorded at the fair value of the shares issuable upon conversion. The excess of the fair value of shares issuable over the face value of the Notes is recorded as a discount to the note to be amortized into interest expense over the term of the note.

The following is a summary of current portion - convertible debt - related and unrelated parties as of December 31, 2020 and December 31, 2019:

		December 31, 2020		December 31, 2019
Face value of notes – related party	(a)	$	95,000	$	95,000
Face value of notes – unrelated parties	(a)		98,077		98,077
Excess of the fair value of shares issuable over the face value of the convertible notes	(a)		48,257		48,257
		$	241,334	$	241,334

(a)

In connection with the reverse merger in July 2017, the Company and two stockholders, who had provided related party advances to the Company, agreed to exchange their related party advances for 6% Convertible Promissory Notes that were originally due on January 15, 2018 (the “Notes”) in the amount of $68,077. From August 2017 through November 2017, the Company issued additional notes to four different parties (two of which were related parties) in the principal amount of $100,000 ($70,000 to related parties). In January 2018, the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019. The Notes bear simple interest at 6% unless the Company defaults, which increases the interest rate to 10%. The Holders, at their option, can elect to convert the principal plus any accrued interest, into shares of the Company’s common stock at a conversion rate equal to eighty percent (80%) of the average closing share price as quoted on the OTC Markets for the five (5) trading days prior to the date of conversion. There are two notes that had a maturity date of June 30, 2019, with the remaining notes having a maturity date of December 31, 2019. These notes have not been extended and are currently in default. The Company has classified these notes as current liabilities. The Company has accrued the default interest on the two notes from July 1, 2019 through December 31, 2020.

During the year ended December 31, 2018, the Company received additional proceeds from a related party of $25,000 (from Dharam V. Sikka, father of CEO) pursuant to a convertible note payable issued in May 2018, with the same interest rate and conversion terms as the Notes described above, initially maturing on December 31, 2018, which has been extended to March 31, 2019 and then again to December 31, 2019. Because the Notes are convertible into a variable number of shares of common stock based on a fixed dollar amount, in accordance with ASC Topic 480-10-50-2, the notes are recorded at the fair value of the shares issuable upon conversion. The excess of the fair value of shares issuable over the face value of the Notes is recorded as a discount to the note to be amortized into interest expense over the term of the note.

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STOCKHOLDERS’ EQUITY (DEFICIT) (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Equity [Abstract]

SUMMARY OF STOCK OPTION

The following represents a summary of options:

	Six Months Ended June 30, 2021				Year Ended December 31, 2020
	Number		Weighted Average Exercise Price		Number		Weighted Average Exercise Price
Beginning balance		3,930,000	$	0.0052		-	$	-
Granted		-		-		3,930,000		0.0052
Exercised		-		-		-		-
Forfeited		-		-		-		-
Expired		-		-		-		-
Ending balance		3,930,000	$	0.0052		3,930,000	$	0.0052
Intrinsic value of options	$	5,874,475			$	6,267,475
Weighted Average Remaining Contractual Life (Years)		9.31				9.81

The following represents a summary of options as of December 31, 2020 and 2019:

	December 31, 2020				December 31, 2019
	Number		Weighted Average Exercise Price		Number		Weighted Average Exercise Price
Beginning balance		-	$	-		-	$	-
Granted		3,930,000		0.0052		-		-
Exercised		-		-		-		-
Forfeited		-		-		-		-
Expired		-		-		-		-
Ending balance		3,930,000	$	0.0052		-	$	-
Intrinsic value of options	$	6,267,475			$	-
Weighted Average Remaining Contractual Life (Years)		9.81

SCHEDULE OF COMMON STOCK WARRANTS

The following schedule summarizes the changes in the Company’s common stock warrants:

						Weighted				Weighted
	Warrants Outstanding					Average				Average
	Number			Exercise		Remaining		Aggregate		Exercise
	Of			Price		Contractual		Intrinsic		Price
	Shares			Per Share		Life		Value		Per Share
Balance at December 31, 2019		1,329,272		$	0.001		4.87 years	$	-	$	0.001
Warrants granted		-		$	-		-			$
Warrants exercised		-		$	-		-			$
Warrants expired/cancelled		-		$	-		-			$
Balance at December 31, 2020		1,329,272		$	0.001		3.87 years	$	2,125,506	$	0.001
Warrants granted		1,980,039		$	0.001-2.00		-			$
Warrants exercised/exchanged		-		$	-		-			$
Warrants expired/cancelled		(419,127	)	$	-		-			$
Balance at June 30, 2021		2,880,184		$	0.001-2.00		2.72 years	$	3,414,248	$	0.42
Exercisable at June 30, 2021		2,333,168		$	0.001-2.00		2.73 years	$	2,594,272	$	0.52

SCHEDULE OF EACH OPTION WARRANT ESTIMATED USING THE BLACK-SCHOLES VALUATION MODEL

Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each option/warrant is estimated using the Black-Scholes valuation model. The following assumptions were used for the three months ended March 31, 2021 and year ended December 31, 2020:

	Six Months Ended June 30, 2021			Year Ended December 31, 2020
Expected term		3 years			-
Expected volatility		100-214	%		-
Expected dividend yield		-			-
Risk-free interest rate		0.15-0.58	%		-

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OPERATING LEASE (Tables)

6 Months Ended

12 Months Ended

Jun. 30, 2021

Dec. 31, 2020

Operating Lease

SCHEDULE OF REMAINING LEASE OBLIGATION

Remaining Lease Obligation by calendar year (undiscounted cash flows)
2022	$	13,209
2023		28,593
2024		28,593
2025		29,487
2026		32,882
2027		58,914
Total lease payments		191,678
Less: Imputed interest		63,759
Present value of lease liabilities	$	127,919

Remaining Lease Obligation by calendar year (undiscounted cash flows)
2021	$	26,087
2022		29,091
2023		29,091
2024		30,000
2025		33,455
2026 and thereafter		59,940
Total lease payments		207,663
Less: Imputed interest		73,665
Present value of lease liabilities	$	133,998

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PROVISION FOR INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

Restructuring Cost and Reserve [Line Items]

SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION

The following table summarizes the significant differences between the U.S. Federal statutory tax rate and the Company’s effective tax rate for financial statement purposes for the years ended December 31, 2020 and 2019:

	2020			2019
Federal income taxes at statutory rate		21.00	%		21.00	%
State income taxes at statutory rate		7.50	%		7.50	%
Temporary differences		0.38	%		(0.82	)%
Permanent differences		(0.98	)%		(7.41	)%
Change in valuation allowance		(27.90	)%		(20.27	)%
Totals		0.00	%		0.00	%

SCHEDULE OF DEFERRED TAX ASSETS

	As of			As of
	December 31, 2020			December 31, 2019
Deferred tax assets:
Net operating losses before non-deductible items	$	747,748		$	579,118
Stock-based compensation		28,174			-
Depreciation		(1,616	)		(1,616	)
Total deferred tax assets		774,306			577,502
Less: Valuation allowance		(774,306	)		(577,502	)
Net deferred tax assets	$	-		$	-

India Based Entity [Member]

Restructuring Cost and Reserve [Line Items]

SCHEDULE OF DEFERRED TAX ASSETS

Significant components of deferred tax liabilities as at December 31, 2020 and 2019 (was acquired May 2019):

	As of			As of
	December 31, 2020			December 31, 2019
Deferred Tax Assets:
Difference between book and tax base of fixed assets	$	43,868		$	56,696
Provision for gratuity		27,189			22,253
Provision for leave encashment		11,030			8,598
Operating lease		5,170			2,339
NOL carryforward (based on last tax return filed per Indian Income Tax laws)		43,140			11,404
Timing difference on TDS under 40a(ia)		9,002			-
MAT credit		8,644			8,860
Deferred Tax Assets		148,043			110,150
Net Deferred Tax Assets		148,043			110,150
Less: Valuation allowance		(148,043	)		(110,150	)
Net Deferred Tax Asset	$	-		$	-

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EMPLOYEE BENEFIT PLANS (Tables)

12 Months Ended

Dec. 31, 2020

Retirement Benefits [Abstract]

SCHEDULE OF EMPLOYEE GRATUITY PLANS

The benefit obligation has been measured as of December 31, 2020. The gratuity plan is unfunded. The following table sets forth the activity of the Gratuity Plans and the amounts recognized in the Company’s financial statements for the year ended December 31, 2020:

	Year Ended
	December 31, 2020
Change in projected benefit obligation:
Projected benefit obligation as of January 1, 2020	$	85,594
Service cost		10,746
Interest cost		5,595
Benefits paid		(19,033	)
Actuarial gain (loss) on the Obligation		23,761
Effect of exchange rate changes		(2,090	)
	$	104,573
Projected benefit obligation as of December 31, 2020
Unfunded amount – non-current	$	94,023
Unfunded amount - current		10,550
Total accrued liability	$	104,573
Components of net period benefit costs:
Service cost	$	10,746
Interest cost		5,595
Actuarial gain (loss) on the Obligation		23,761
	$	40,102
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		5.55% per annum
Rate of increase in compensation levels		10.00 % per annum

The benefit obligation has been measured as of December 31, 2019. The gratuity plan is unfunded. The following table sets forth the activity of the Gratuity Plans and the amounts recognized in the Company’s financial statements for the period May 16, 2019 through December 31, 2019:

	Period May 16, 2019 through
	December 31, 2019
Change in projected benefit obligation:
Projected benefit obligation as of May 16, 2019	$	65,550
Service cost		6,982
Interest cost		3,106
Benefits paid		(1,932	)
Actuarial gain (loss) on the Obligation		13,086
Effect of exchange rate changes		(1,198	)
	$	85,594
Projected benefit obligation as of December 31, 2019
Unfunded amount – non-current	$	74,781
Unfunded amount - current		10,813
Total accrued liability	$	85,594
Components of net period benefit costs:
Service cost	$	6,982
Interest cost		3,106
Actuarial gain (loss) on the Obligation		11,888
	$	21,976
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		6.70% per annum
Rate of increase in compensation levels		10.00 % per annum

Leave Encashment:

The other long-term employee benefits has been measured as of December 31, 2020. The following table sets forth the activity of the leave encashment and the amounts recognized in TRAQ Pvt Ltd.’s financial statements at December 31, 2020:

	Year Ended
	December 31, 2020
Change in projected benefit obligation:
Projected benefit obligation as of January 1, 2020	$	33,070
Service cost		10,746
Interest cost		5,595
Benefits paid		(2,212	)
Actuarial gain (loss) on the Obligation		(3,969	)
Effect of exchange rate changes		(806	)
	$	42,424
Projected benefit obligation as of December 31, 2020
Unfunded amount – non-current	$	37,306
Unfunded amount - current		5,118
Total accrued liability	$	42,424
Components of net period benefit costs:
Service cost	$	10,746
Interest cost		5,595
Actuarial gain (loss) on the Obligation		(3,969	)
	$	12,372
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		5.55% per annum
Rate of increase in compensation levels		10.00 % per annum

The other long-term employee benefits has been measured as of December 31, 2019. The following table sets forth the activity of the leave encashment and the amounts recognized in TRAQ Pvt Ltd.’s financial statements at the end of the period May 16, 2019 through December 31, 2019:

	Period May 16, 2019 through
	December 31, 2019
Change in projected benefit obligation:
Projected benefit obligation as of May 16, 2019	$	24,243
Service cost		3,646
Interest cost		940
Benefits paid		(919	)
Actuarial gain (loss) on the Obligation		5,617
Effect of exchange rate changes		(457	)
	$	33,070
Projected benefit obligation as of December 31, 2019
Unfunded amount – non-current	$	27,682
Unfunded amount - current		5,388
Total accrued liability	$	33,070
Components of net period benefit costs:
Service cost	$	3,646
Interest cost		940
Actuarial gain (loss) on the Obligation		5,160
	$	9,746
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost are:
Discount rate		6.70% per annum
Rate of increase in compensation levels		10.00 % per annum

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GOODWILL (Tables)

6 Months Ended

Jun. 30, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

SCHEDULE OF GOODWILL

The Company’s goodwill consists of the following:

	June 30, 2021		December 31, 2020
Rohuma	$	3,519,869	$	-
Mimo Technologies		2,987,811		-
Net	$	6,507,680	$	-

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CONVERTIBLE NOTES PAYABLE (Tables)

6 Months Ended

Jun. 30, 2021

Convertible Notes Payable

SCHEDULE OF CONVERTIBLE NOTES OUTSTANDING

As of June 30, 2021 and December 31, 2020, the Company had the following convertible notes outstanding:

		June 30, 2021			December 31, 2020
GS Capital	(a)	$	105,000		$	-
Platinum Point Capital	(b)		400,000			-
Total Convertible Notes Payable		$	505,000		$	-
Less: Discounts			(176,902	)		-
		$	328,098		$	-

(a)

On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the amount of $125,000. The GS Note has a maturity of one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000. The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon achievement of the terms of the GS Note.

(b)

On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”). The Platinum Note has a maturity of one-year. The conversion price of the Platinum Note is the greater of (a) $0.01 or (b) 70% of the lowest closing stock price over the previous 15 trading days. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 200,000 warrants that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections, that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 60,000 shares as a commitment fee.

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DERIVATIVE LIABILITIES (Tables)

6 Months Ended

Jun. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

SCHEDULE OF VALUATION ASSUMPTIONS

	Six Months Ended June 30, 2021			Year Ended December 31, 2020
Expected term		1 year			-
Expected volatility		164 - 214	%		-
Expected dividend yield		-			-
Risk-free interest rate		0.15	%		-

SCHEDULE OF DERIVATIVE LIABILITIES

The Company’s derivative liabilities are as follows:

	June 30, 2021		December 31, 2020
Fair value of the GS Capital conversion option	$	280,000	$	-
Fair value of the Platinum Point conversion option		1,024,000		-
Fair value of the Platinum Point warrants (200,000 warrants)		206,000		-
	$	1,510,000	$	-

SCHEDULE OF ACTIVITY RELATED TO DERIVATIVE LIABILITIES

Activity related to the derivative liabilities for the period ended June 30, 2021 is as follows:

Beginning balance as of December 31, 2020	$	-
Issuances of warrants/conversion option – derivative liabilities		313,868
Warrants exchanged for common stock		-
Change in fair value of warrants/conversion option - derivative liabilities		1,196,132
Ending balance as of June 30, 2021	$	1,510,000

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ORGANIZATION AND NATURE OF OPERATIONS (Details Narrative) - USD ($)							3 Months Ended		6 Months Ended		12 Months Ended
	Mar. 02, 2021	Feb. 17, 2021	Jan. 22, 2021	May 16, 2019	Dec. 01, 2017	Jul. 19, 2017	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019	Mar. 31, 2021	May 31, 2019
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Target revenue							$ 937,002	$ 230,258	$ 1,319,388	$ 521,319	$ 1,009,949	$ 680,732
TRAQIQ Solutions Private Limited [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Equity interest owned by member														100.00%
Warrants term														5 years
Number of warrants issued														1,329,272
MIMO Technologies PVT Ltd [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Note receivable written off		$ 258,736
Accounts receivable written off		123,778
Debenture written off		40,354
Cash payment to minority shareholders		$ 22,338
Share Exchange Agreement [Member] | Rohuma, LLC [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Ownership interest percentage	99.00%
Equity interest owned by member	1.00%
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Ownership interest percentage	99.00%
Warrants term		3 years
Number of warrants issued		1,367,539
Number of warrants earned		820,524
Remaining warrants expected to be earned		547,015
Warrants exercise price		$ 0.001
Amount of warrants outstanding		$ 1,640,447
Equity interest owned by member		1.00%
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member] | Contingent Consideration [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Amount of warrants outstanding		$ 656,179
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Equity interest owned by member				100.00%
Warrants term				5 years
Number of warrants issued				1,329,272
Warrants to purchase common stock, value				$ 268
Target revenue				$ 1,100,000
Pre-tax profit percentage				25.00%
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member] | Immediately Upon Closing [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number of warrants issued				100,771
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member] | One Year After The Date Of Closing [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number of warrants issued				859,951									859,951
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member] | Two Years After The Date Of Closing [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number of warrants issued				368,550
Share Exchange Agreement [Member] | Rohuma, LLC [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Equity interest owned by member	1.00%
Number ofcommon stock issued			4,292,220
Share Exchange Agreement [Member] | Rohuma, LLC [Member] | Share-based Payment Arrangement, Tranche One [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number ofcommon stock issued	2,562,277
Transaction value	$ 3,433,776
Shares issued, price per share	$ 0.80
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Equity interest owned by member		1.00%
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member] | Contingent Consideration [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Amount of warrants outstanding		$ 656,179
Share Exchange Agreement [Member] | Additional Paid-in Capital [Member] | MIMO Technologies PVT Ltd [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Amount of warrants outstanding		984,268
Share Exchange Agreement [Member] | Additional Paid-in Capital [Member] | MIMO Technologies PVT Ltd [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Amount of warrants outstanding		$ 984,268
Share Exchange Agreement [Member] | OmniM2M and Ci2i [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Ownership interest percentage						100.00%
Exchange shares of common stock						12,000,000
Share Exchange Agreement [Member] | OmniM2M and Ci2i [Member] | Pro Rata Basis [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number shares issued during period						12,000,000
Share Exchange Agreement [Member] | TransportIQ, Inc [Member] | Ajay Sikka [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Exchange of cancellation debt					$ 18,109

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SUMMARY OF DISAGGREGATION OF REVENUE (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Product Information [Line Items]
Revenue	$ 937,002	$ 230,258	$ 1,319,388	$ 521,319	$ 1,009,949	$ 680,732
Professional Services Revenue [Member]
Product Information [Line Items]
Revenue			593,898	463,385	935,214	654,374
Software Solution Revenue [Member]
Product Information [Line Items]
Revenue			180,697	57,934	$ 74,735	$ 26,358
Sale of Goods [Member]
Product Information [Line Items]
Revenue			$ 544,793

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019	May 31, 2019
Restructuring Cost and Reserve [Line Items]
Cash	$ 137,530	$ 29,658	$ 9,094
Restricted cash	165,488	28,746	182,627
Allowance for accounts receivable	$ 160,403	$ 0	0
Property, Plant and Equipment, Estimated Useful Lives	three to ten years.	three to ten years.
Intangible assets estimated useful lives	15 years	15 years
Impairment of long-lived assets		$ 0	0
Payments to acquire software	$ 146,065
Accumulated deficit	6,008,129	2,504,893	1,896,984
Working capital deficit	$ 8,120,378	$ 2,851,721	$ 2,697,036
TRAQIQ Solutions Private Limited [Member]
Restructuring Cost and Reserve [Line Items]
Percentage of voting interest acquired				100.00%
Warrants term				5 years
Warrants to purchase common stock				1,329,272

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SCHEDULE OF BUSINESS ACQUISITION (Details) - USD ($)	Feb. 17, 2021	Jan. 22, 2021	May 16, 2019
Business Acquisition [Line Items]
Cash			$ 185,633
Accounts receivables, net			506,951
Prepaid expenses and other current assets			216,956
Right-of-use asset			576,566
Fixed and intangible assets			68,260
Customer relationships			448,800
Tradenames			49,799
Investment			42,248
Other assets			37,950
Accounts payable and accrued expenses			(173,197)
Accrued payroll and related taxes			(325,629)
Accrued duties and taxes			(66,765)
Lease liability			(585,207)
Deferred revenue			(3,618)
Cash overdraft			(471,017)
Debt – related parties			(61,273)
Debt			(29,041)
Net assets and liabilities acquired			$ 417,416
Rohuma, LLC [Member]
Business Acquisition [Line Items]
Cash		$ 6,027
Accounts receivables, net		4,179
Prepaid expenses and other current assets		8,943
Fixed and intangible assets		4,512
Investment		1,440
Accounts payable and accrued expenses		(58,153)
Accrued payroll and related taxes
Accrued duties and taxes		(2,688)
Cash overdraft		(2,980)
Debt – related parties		(37,776)
Debt		(10,000)
Net assets and liabilities acquired		(86,496)
Comprehensive income
MIMO Technologies PVT Ltd [Member]
Business Acquisition [Line Items]
Cash	$ 43,851
Accounts receivables, net	58,692
Prepaid expenses and other current assets	272,872
Fixed and intangible assets	153,186
Accounts payable and accrued expenses	(708,833)
Accrued payroll and related taxes	(104,750)
Accrued duties and taxes	(28,213)
Debt – related parties	(343,118)
Debt	(236,712)
Net assets and liabilities acquired	(935,760)
Comprehensive income	$ (42,735)

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SCHEDULE OF BUSINESS ACQUISITION (Details) (Parenthetical)	May 16, 2019 USD ($)
TRAQIQ Solutions Private Limited [Member]
Business Acquisition [Line Items]
Restricted cash	$ 185,399

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SCHEDULE OF PROFORMA FOR BUSINESS ACQUISITION (Details) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Business Combination and Asset Acquisition [Abstract]
Revenues	$ 1,355,350	$ 732,415	$ 1,143,606
Net income (loss)	$ (3,555,172)	$ (488,535)	$ (166,533)
Net income (loss) per share	$ (0.12)	$ (0.02)	$ (0.01)

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ACQUISITIONS (Details Narrative) - USD ($)				3 Months Ended		6 Months Ended		12 Months Ended
	Mar. 02, 2021	Jan. 22, 2021	May 16, 2019	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019	Mar. 31, 2021	Feb. 17, 2021	May 31, 2019
Business Acquisition [Line Items]
Target revenue				$ 937,002	$ 230,258	$ 1,319,388	$ 521,319	$ 1,009,949	$ 680,732
Gain (loss) on bargain purchase									$ 417,148
Net assets and liabilities acquired			$ 417,416
Goodwill				$ 6,507,680		$ 6,507,680					$ 2,085,653
TRAQIQ Solutions Private Limited [Member]
Business Acquisition [Line Items]
Percentage of voting interest acquired												100.00%
Warrants term												5 years
Number of warrants issued												1,329,272
Rohuma, LLC [Member]
Business Acquisition [Line Items]
Net assets and liabilities acquired		$ (86,496)
Business acquisition contingent consideration		1,383,954
Goodwill		$ 3,520,272
MIMO Technologies PVT Ltd [Member]
Business Acquisition [Line Items]
Net assets and liabilities acquired											(935,760)
Goodwill											$ 3,021,413
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Business Acquisition [Line Items]
Warrants term											3 years
Number of warrants issued											1,367,539
Ownership interest percentage											99.00%
Share Exchange Agreement [Member] | Rohuma, LLC [Member]
Business Acquisition [Line Items]
Ownership interest percentage	99.00%
Equity interest owned by member	1.00%
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Business Acquisition [Line Items]
Warrants term											3 years
Number of warrants issued											1,367,539
Net assets and liabilities acquired											$ 935,760
Ownership interest percentage	99.00%
Equity interest owned by member											1.00%
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member]
Business Acquisition [Line Items]
Percentage of voting interest acquired			100.00%
Warrants term			5 years
Number of warrants issued			1,329,272
Warrants to purchase common stock, value			$ 268
Target revenue			$ 1,100,000
Pre-tax profit percentage			25.00%
Gain (loss) on bargain purchase			$ 417,148
Net assets and liabilities acquired			$ 417,416
Gain (loss) on bargain purchase			419,127
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member] | Immediately Upon Closing [Member]
Business Acquisition [Line Items]
Number of warrants issued			100,771
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member] | One Year After The Date Of Closing [Member]
Business Acquisition [Line Items]
Number of warrants issued			859,951							859,951
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member] | Two Years After The Date Of Closing [Member]
Business Acquisition [Line Items]
Number of warrants issued			368,550
Share Exchange Agreement [Member] | Rohuma, LLC [Member]
Business Acquisition [Line Items]
Percentage of voting interest acquired	1.00%
Number ofcommon stock issued		4,292,220
Share Exchange Agreement [Member] | Rohuma, LLC [Member] | Share-based Payment Arrangement, Tranche One [Member]
Business Acquisition [Line Items]
Net assets and liabilities acquired		$ 86,496
Number ofcommon stock issued	2,562,277
Transaction value	$ 3,433,776
Shares issued, price per share	$ 0.80
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Business Acquisition [Line Items]
Percentage of voting interest acquired											1.00%

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SCHEDULE OF CASH AND RESTRICTED CASH (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
Cash and Cash Equivalents [Abstract]
Cash on hand	$ 109	$ 141	$ 252
Bank balances	137,421	29,517	8,842
Restricted cash	165,488	28,746	182,627
Total	$ 303,018	$ 58,404	$ 191,721

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CASH AND RESTRICTED CASH (Details Narrative) - USD ($)	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
Cash and Cash Equivalents [Abstract]
Cash equivalents	$ 0	$ 0	$ 0

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SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Property and equipment - TRAQ Pvt Ltd.		$ 638,587	$ 650,621
Less: accumulated depreciation	$ (599,351)	(602,214)	(601,940)
Property and equipment net	36,819	36,373	$ 48,681
TRAQIQ Solutions Private Limited [Member]
Property, Plant and Equipment [Line Items]
Property and equipment - TRAQ Pvt Ltd.	628,026	638,587
Rohuma US [Member]
Property, Plant and Equipment [Line Items]
Property and equipment - TRAQ Pvt Ltd.	1,100
Rohuma India [Member]
Property, Plant and Equipment [Line Items]
Property and equipment - TRAQ Pvt Ltd.	4,117
MIMO Technologies PVT Ltd [Member]
Property, Plant and Equipment [Line Items]
Property and equipment - TRAQ Pvt Ltd.	$ 2,927
Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated Life		3 years
Minimum [Member] | TRAQIQ Solutions Private Limited [Member]
Property, Plant and Equipment [Line Items]
Estimated Life	3 years
Minimum [Member] | Rohuma US [Member]
Property, Plant and Equipment [Line Items]
Estimated Life	3 years
Minimum [Member] | Rohuma India [Member]
Property, Plant and Equipment [Line Items]
Estimated Life	3 years
Minimum [Member] | MIMO Technologies PVT Ltd [Member]
Property, Plant and Equipment [Line Items]
Estimated Life	3 years
Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated Life		10 years
Maximum [Member] | TRAQIQ Solutions Private Limited [Member]
Property, Plant and Equipment [Line Items]
Estimated Life	10 years
Maximum [Member] | Rohuma US [Member]
Property, Plant and Equipment [Line Items]
Estimated Life	10 years
Maximum [Member] | Rohuma India [Member]
Property, Plant and Equipment [Line Items]
Estimated Life	10 years
Maximum [Member] | MIMO Technologies PVT Ltd [Member]
Property, Plant and Equipment [Line Items]
Estimated Life	10 years

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FIXED ASSETS (Details Narrative) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 11,615	$ 8,186	$ 14,747	$ 22,065

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SCHEDULE OF INTANGIBLE ASSETS (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
Intangible Assets
Customer relationships	$ 448,800	$ 448,800	$ 448,800
Tradenames	49,799	49,799	49,799
Software	250,451
Less: accumulated amortization	(185,418)	(54,015)	(20,775)
Net	$ 563,632	$ 444,584	$ 477,824

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INTANGIBLE ASSETS (Details Narrative) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Intangible Assets
Amortization expense	$ 25,404	$ 16,620	$ 33,240	$ 20,775

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SCHEDULE OF LONG-TERM INVESTMENT (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
Net Investment Income [Line Items]
Long term investment	$ 1,440	$ 40,603	$ 41,617
Equity Security - Compulsorily Convertible Debenture [Member]
Net Investment Income [Line Items]
Long term investment		$ 40,603	$ 41,617

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LONG-TERM INVESTMENT (Details Narrative) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020	Jan. 22, 2021
Restructuring Cost and Reserve [Line Items]
Investment percentage	1.00%	1.00%
Debt Instrument, Term	7 years	7 years
Rohuma, LLC [Member]
Restructuring Cost and Reserve [Line Items]
Investment acquired in acquisition			$ 1,440

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SCHEDULE OF NOTE RECEIVABLE (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
MIMO Technologies PVT Ltd [Member]
Total notes receivable		$ 227,877

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NOTE RECEIVABLE (Details Narrative)	Jun. 30, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2020 INR (₨)	Apr. 02, 2020 USD ($)	Apr. 02, 2020 INR (₨)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Notes receivable related party		$ 227,877	₨ 16,647,264	$ 170,000	₨ 15,037,263
Notes receivable interest rate percentage				13.00%	13.00%
MIMO Technologies PVT Ltd [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Notes receivable related party | $	$ 258,736
INR [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Notes receivable related party | ₨			₨ 16,647,264		₨ 15,037,263

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SCHEDULE OF LONG-TERM DEBT RELATED PARTIES (Details)				12 Months Ended
		Feb. 01, 2017 USD ($)	Jan. 03, 2017 USD ($)	Dec. 31, 2019 USD ($)		Jun. 30, 2021 USD ($)		Jun. 18, 2021 USD ($)	Jun. 18, 2021 INR (₨)	Dec. 31, 2020 USD ($)
Short-term Debt [Line Items]
Long term debt current - related parties				$ 1,338,737		$ 2,644,839				$ 1,843,399
Current portion of long-term debt related parties				(1,306,737)		(2,629,839)				(1,843,399)
Long-term debt - related parties				$ 32,000		15,000
Swarn Singh [Member]
Short-term Debt [Line Items]
Debt instrument, interest rate, stated percentage		15.00%	15.00%	21.00%
Loan bears monthly interest rate		1.25%	1.25%	1.75%
Notes Payable		$ 20,000	$ 25,000
Lathika Regunathan [Member]
Short-term Debt [Line Items]
Notes Payable | ₨									₨ 7,650,000
Debt instrument Interest due on demand								$ 100,000
Unsecured advances - CEO [Member]
Short-term Debt [Line Items]
Long term debt current - related parties				$ 1,221,737	[1]	2,006,691	[2]			1,718,277	[1],[2]
Note Payable - Satinder Thiara [Member]
Short-term Debt [Line Items]
Long term debt current - related parties				57,000	[3]	32,000	[4]			57,000	[3],[4]
Promissory Note - Kunaal Sikka [Member]
Short-term Debt [Line Items]
Long term debt current - related parties				15,000	[5]	15,000	[6]			15,000	[5],[6]
Notes Payable - Swarn Singh [Member]
Short-term Debt [Line Items]
Long term debt current - related parties				45,000	[7]	45,000	[8]			45,000	[7],[8]
Notes Payable-Chaudhary [Member]
Short-term Debt [Line Items]
Long term debt current - related parties					[9]	8,427	[10]			8,122	[9],[10]
Note Payable Director [Member]
Short-term Debt [Line Items]
Long term debt current - related parties	[11]					400,000
Advancesformer C E Oof Rohuma [Member]
Short-term Debt [Line Items]
Long term debt current - related parties						15,141
Advances - Former CEO of Mimo Technologies [Member]
Short-term Debt [Line Items]
Long term debt current - related parties	[12]					$ 122,580

[1] This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at 15% annually (1.25% monthly) and are due on demand.

[2] This is an unsecured advance from the CEO originally entered into January 1, 2015. The note bears interest at 15% annually (1.25% monthly) and are due on demand.

[3] Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due December 31, 2021, December 13, 2016 ($10,000) which is due December 31, 2021, and May 1, 2018 ($25,000) which matured December 31, 2019 at interest rate of 15% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).

[4] Notes payable to Satinder Thiara entered into May 25, 2016 ($22,000) which is due December 31, 2021, December 13, 2016 ($10,000) which is due December 31, 2021, and May 1, 2018 ($25,000) which matured December 31, 2019 at interest rate of 15% annually (1.25% monthly). These are unsecured loans. The May 1, 2018 note is in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly). The May 1, 2018 note that matured December 31, 2019 was converted along with $12,392 in accrued interest into 43,990 shares of common stock on March 5, 2021.

[5] Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on December 31, 2019, and accruing interest at an annual rate of 12%. The note is in default as of December 31, 2019. As a result the interest rate was changed to 18% annually (1.50% monthly).

[6] Unsecured promissory note from Kunaal Sikka, the CEO’s son, dated September 13, 2018, in the amount of $15,000, maturing on December 31, 2019, and accruing interest at an annual rate of 12%. The note was in default as of December 31, 2019 through June 25, 2021 when the note was extended until December 31, 2022. As a result the interest rate was changed to 18% annually (1.50% monthly) through June 25, 2021 and then changed to 6% annually.

[7] Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of 15% annually (1.25% monthly). These are unsecured notes. Both notes were due December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).

[8] Note payable to Swarn Singh, father-in-law of the CEO, entered into January 3, 2017 ($25,000) and February 1, 2017 ($20,000) at interest rate of 15% annually (1.25% monthly). These are unsecured notes. Both notes were due December 31, 2019. The notes are in default as of December 31, 2019. As a result the interest rate was changed to 21% annually (1.75% monthly).

[9] Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of 1,100,000 INR (approximately $14,500 US$) due on demand at 13% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,179.

[10] Note payable to Sushil Chaudhary dated April 27, 2020 in the amount of 1,100,000 INR (approximately $14,500 US$) due on demand at 13% per annum. This amount was offset by an amount due from the company that Sushil Chaudhary owns in the amount of $8,179.

[11] Note payable to a director dated June 15, 2021 that matures December 12, 2021 in the amount of $400,000. The note does not bear interest however the director received two tranches of 150,000 shares each for lending this amount. If the note is repaid by the maturity date, one of the two tranches of 150,000 shares will be returned.

[12] Note payable to Lathika Regunathan dated June 18, 2021 in the amount of 7,650,000 INR (approximately $100,000 US$) interest free and due on demand.

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SCHEDULE OF LONG-TERM DEBT RELATED PARTIES (Details) (Parenthetical)											3 Months Ended	12 Months Ended
	Mar. 05, 2021 shares	Sep. 13, 2018 USD ($)	May 01, 2018 USD ($)	Feb. 28, 2017	Feb. 01, 2017 USD ($)	Jan. 31, 2017	Jan. 03, 2017 USD ($)	Dec. 13, 2016 USD ($)	May 25, 2016 USD ($)	Jan. 01, 2015	Mar. 31, 2021 shares	Jun. 15, 2021	Dec. 31, 2019 USD ($)	Dec. 31, 2020 USD ($)	Aug. 27, 2020 USD ($)	Aug. 27, 2020 INR (₨)	Jun. 15, 2020 USD ($)
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Accrued Interest													$ 12,392
Conversion of common stock | shares	43,990										181,250
Kunaal Sikka [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Debt instrument, interest rate, stated percentage		12.00%											18.00%
Loan bears monthly interest rate													1.50%
Debt instrument maturity date		Dec. 31, 2019
Advance from related party debt		$ 15,000
Swarn Singh [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Debt instrument, interest rate, stated percentage					15.00%		15.00%						21.00%
Loan bears monthly interest rate					1.25%		1.25%						1.75%
Debt instrument maturity date				Dec. 31, 2019		Dec. 31, 2019
Notes Payable					$ 20,000		$ 25,000
Sushi lChaudhary [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Debt instrument, interest rate, stated percentage															13.00%	13.00%
Note payable to related parties														$ 8,179	$ 14,500	₨ 1,100,000
Sushi lChaudhary [Member] | INR [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Note payable to related parties | ₨																₨ 1,100,000
Director [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Note payable to related parties																	$ 400,000
Settlement description												The note does not bear interest however the director received two tranches of 150,000 shares each for lending this amount. If the note is repaid by the maturity date, one of the two tranches of 150,000 shares will be returned.
Notes Payable to Satinder Thiara [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Debt instrument, interest rate, stated percentage			15.00%					15.00%	15.00%				21.00%
Loan bears monthly interest rate			1.25%					1.25%	1.25%				1.75%
Note payable to related parties			$ 25,000					$ 10,000	$ 22,000
Debt instrument maturity date			Dec. 31, 2019					Dec. 31, 2021	Dec. 31, 2021
Chief Executive Officer [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Debt instrument, interest rate, stated percentage										15.00%
Loan bears monthly interest rate										1.25%

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LONG-TERM DEBT RELATED PARTIES (Details Narrative) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Long-term Debt Related Parties
Long-term debt related parties interest expense	$ 158,537	$ 107,869	$ 228,748	$ 170,688

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SCHEDULE OF LONG-TERM DEBT (Details) - USD ($)		Jun. 30, 2021		Dec. 31, 2020		Jun. 30, 2020	Dec. 31, 2019
Short-term Debt [Line Items]
Long term debt, total		$ 373,168		$ 193,617			$ 210,710
Current portion		(317,876)		(133,761)			(191,508)
Long-term debt, net of current portion		55,292		59,856			19,202
Lathika Regunathan [Member]
Short-term Debt [Line Items]
Long term debt, total	[1]
Noor Qazi [Member]
Short-term Debt [Line Items]
Long term debt, total			[2]		[3]		50,562	[3]
Loan Builder [Member]
Short-term Debt [Line Items]
Long term debt, total	[4]	47,367
Satin [Member]
Short-term Debt [Line Items]
Long term debt, total
SBA - Rohuma [Member]
Short-term Debt [Line Items]
Long term debt, total		10,000
Promissory Notes Kabbage [Member]
Short-term Debt [Line Items]
Long term debt, total	[5]						23,826
Promissory Notes Loan Builder [Member]
Short-term Debt [Line Items]
Long term debt, total	[6]
Other Debt [Member]
Short-term Debt [Line Items]
Long term debt, total		6,000	[7]	6,000	[7],[8]		6,000	[8]
Yukti Securities Private Limited [Member]
Short-term Debt [Line Items]
Long term debt, total			[9]	4,547	[10]		4,660	[10]
Auto Loan ICICI Bank [Member]
Short-term Debt [Line Items]
Long term debt, total		14,769	[11]	18,539	[11],[12]		25,662	[12]
Baxter Credit Union [Member]
Short-term Debt [Line Items]
Long term debt, total		99,975	[13]	99,911	[13],[14]		100,000	[14]
UGECL [Member]
Short-term Debt [Line Items]
Long term debt, total		53,960	[15]	54,563	[15],[16]			[16]
USA Bank PPP [Member]
Short-term Debt [Line Items]
Long term debt, total			[17]	$ 10,057	[17],[18]			[18]
Loan Builder [Member]
Short-term Debt [Line Items]
Long term debt, total	[4]
Satin [Member]
Short-term Debt [Line Items]
Long term debt, total		$ 141,097

[1] Unsecured loan from Lathika Regunathan, individual, is due on demand. Was repaid in 2019.

[2] Unsecured loan from Noor Qazi, individual, is due on demand. Was repaid in December 2020.

[3] Unsecured loan from Noor Qazi, individual, is due on demand. Was repaid in December 2020.

[4] $50,000 unsecured loan due in 52 weekly payments of $1,057.94 inclusive of interest at approximately 10%.

[5] Multiple monthly loan agreements with Kabbage. Each of these loans has a six-month duration with interest and fees spread over the 6 months.

[6] Business loan agreement with LoanBuilder in August 2018 in the amount of $18,000, payable in 52 weekly payments of $409, including interest.

[7] Note payable to an individual for $7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made a payment of $1,500 against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider.

[8] Note payable to an individual for $7,500, issued in May 2018 as consideration for services, due in June 2018, and bearing no interest. During the year ended December 31, 2018, the Company made a payment of $1,500 against the note and the Company has withheld payment of the remaining amount pending receipt of amounts due from the service provider.

[9] Loan payable to Yukti Securities Private Limited is an unsecured loan which is due on demand.

[10] Loan payable to Yukti Securities Private Limited is an unsecured loan which is due on demand.

[11] Loan payable with ICICI Bank, secured by the vehicle the loan was taken for. Payments are monthly at $752, through maturity in May 2023. Of the amount outstanding, the following represents the maturity: Current (2021-2022) $7,374; (2022-2023) $7,395.

[12] Loan payable with ICICI Bank, secured by the vehicle the loan was taken for. Payments are monthly at $752, through maturity in May 2023. Of the amount outstanding, the following represents the maturity: Current (2021) $7,183; (2022) $7,837; (2023) $3,519.

[13] Revolving loan in the amount of $100,000 at 4% interest per annum due December 30, 2020. The loan was renegotiated for a balance of $99,911 with similar terms at 4% interest per annum and is guaranteed by the CEO of the Company.

[14] Revolving loan in the amount of $100,000 at 4% interest per annum due December 30, 2020. The loan was renegotiated for a balance of $99,911 with similar terms at 4% interest per annum and is guaranteed by the CEO of the Company.

[15] COVID line of credit from UGECL up to 4,000,000 INR in India, term of 48 months, interest only at 7.5% annual rate for first 12 months, then 36 equal instalments through maturity. Current (2021) $6,063; long-term (2022-2024) $47,897.

[16] COVID line of credit from UGECL up to 4,000,000 INR in India, term of 48 months, interest only at 7.5% annual rate for first 12 months, then 36 equal installments through maturity. Current (2021) $6,063; long-term (2022-2024) $48,500.

[17] PPP loan from USA Bank, with interest accruing at 1% per annum. Original amount of $34,697 had $24,640 forgiven in December 2020, with the remaining $10,057 due in five years In February 2021, the Company was notified that the entire balance of the PPP loan has been forgiven.

[18] PPP loan from USA Bank, with interest accruing at 1% per annum. Original amount of $34,697 had $24,640 forgiven in December 2020, with the remaining $10,057 due in five years In February 2021, the Company was notified that the entire balance of the PPP loan has been forgiven.

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SCHEDULE OF LONG-TERM DEBT (Details) (Parenthetical)	1 Months Ended		6 Months Ended		12 Months Ended
	Feb. 28, 2021 USD ($)	Aug. 31, 2018 USD ($)	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Jun. 30, 2021 INR (₨)	Dec. 31, 2020 INR (₨)	May 31, 2018 USD ($)
Short-term Debt [Line Items]
Payment of notes payable			$ 20,000
Interest expense debt			$ 2,539	$ 5,546	$ 6,932	$ 12,110
Promissory Notes Loan Builder [Member]
Short-term Debt [Line Items]
Debt periodic payment description		Business loan agreement with LoanBuilder in August 2018 in the amount of $18,000, payable in 52 weekly payments of $409, including interest.
Business loan agreement, amount payable		$ 18,000
Periodic payment of debt		$ 409
Other Debt [Member]
Short-term Debt [Line Items]
Note payable to related parties										$ 7,500
Payment of notes payable							$ 1,500
Auto Loan ICICI Bank [Member]
Short-term Debt [Line Items]
Debt periodic payment description			Payments are monthly at $752, through maturity in May 2023.		Payments are monthly at $752, through maturity in May 2023.
Periodic payment of debt			$ 752		$ 752
Long-term debt, maturity, year 2021-2022			7,374		7,183
Long-term debt, maturity, year 2022-2023			7,395		7,837
Long-term debt, maturity, year 2022-2024					3,519
Revolving Loan [Member]
Short-term Debt [Line Items]
Debt instrument, face value			$ 100,000		$ 100,000
Debt instrument, interest rate, stated percentage			4.00%		4.00%			4.00%	4.00%
Debt, maturity date			Dec. 30, 2020		Dec. 30, 2020
Revolving Loan [Member] | Renegotiated Balance [Member]
Short-term Debt [Line Items]
Debt instrument, face value			$ 99,911		$ 99,911
Debt instrument, interest rate, stated percentage			4.00%		4.00%			4.00%	4.00%
COVID UGECL [Member]
Short-term Debt [Line Items]
Long-term debt, maturity, year 2021-2022			$ 6,063		$ 6,063
Long-term debt, maturity, year 2022-2024			$ 47,897
Debt instrument, interest rate, stated percentage			7.50%		7.50%			7.50%	7.50%
Line of credit term			COVID line of credit from UGECL up to 4,000,000 INR in India, term of 48 months		COVID line of credit from UGECL up to 4,000,000 INR in India
Line of credit | ₨								₨ 4,000,000
Line of credit interest			interest only at 7.5% annual rate for first 12 months, then 36 equal instalments through maturity.		interest only at 7.5% annual rate for first 12 months
Long-term debt, maturity, year 2022-2024					$ 48,500
COVID UGECL [Member] | INR [Member]
Short-term Debt [Line Items]
Line of credit | ₨									₨ 4,000,000
Paycheck Protection Program Loan [Member]
Short-term Debt [Line Items]
Debt instrument, face value			$ 34,697		$ 34,697
Debt instrument, interest rate, stated percentage			1.00%		1.00%			1.00%	1.00%
Debt, forgiven	$ 10,057		$ 24,640		$ 24,640
Paycheck Protection Program Loan [Member] | Subsequent Event [Member]
Short-term Debt [Line Items]
Debt, forgiven	$ 10,057
Unsecured Loan [Member]
Short-term Debt [Line Items]
Debt instrument, face value			$ 50,000
Debt instrument, interest rate, stated percentage			10.00%					10.00%
Debt instrument description			50,000 unsecured loan due in 52 weekly payments
Interest expense debt			$ 1,057.94

XML

LONG-TERM DEBT (Details Narrative) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Debt Disclosure [Abstract]
Long-term debt interest expense	$ 2,539	$ 5,546	$ 6,932	$ 12,110

XML

SUMMARY OF CARRYING VALUE OF CONVERTIBLE DEBT (Details) - USD ($)	Jun. 30, 2021		Dec. 31, 2020		Dec. 31, 2019	[2]
Defined Benefit Plan Disclosure [Line Items]
Excess of the fair value of shares issuable over the face value of the convertible notes	$ 17,007	[1]	$ 48,257	[1]	$ 48,257
Convertible debt current - Related and unrelated parties	85,084		241,334		241,334
Related Party [Member]
Defined Benefit Plan Disclosure [Line Items]
Debt instrument, face value		[1]	95,000	[1]	95,000
Unrelated Parties [Member]
Defined Benefit Plan Disclosure [Line Items]
Debt instrument, face value	$ 68,077	[1]	$ 98,077	[1]	$ 98,077

[1] In connection with the reverse merger in July 2017, the Company and two stockholders, who had provided related party advances to the Company, agreed to exchange their related party advances for 6% Convertible Promissory Notes that were originally due on January 15, 2018 (the “Notes”) in the amount of $68,077. From August 2017 through November 2017, the Company issued additional notes to four different parties (two of which were related parties) in the principal amount of $100,000 ($70,000 to related parties). In January 2018, the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019. The Notes bear simple interest at 6% unless the Company defaults, which increases the interest rate to 10%. The Holders, at their option, can elect to convert the principal plus any accrued interest, into shares of the Company’s common stock at a conversion rate equal to eighty percent (80%) of the average closing share price as quoted on the OTC Markets for the five (5) trading days prior to the date of conversion. There are two notes that had a maturity date of June 30, 2019, with the remaining notes having a maturity date of December 31, 2019. These notes had not been extended and were in default until June 30, 2021, when the note holders agreed to extend the debt until October 31, 2021, with no other changes to the notes. The Company has classified these notes as current liabilities. The Company had accrued the default interest on the two notes from July 1, 2019 through March 4, 2021. On March 5, 2021, the Company converted $156,250 in convertible notes which includes the excess of the fair value of shares issuable over the face value of the convertible notes along with $31,046 in accrued interest into 187,296 shares of common stock.

[2] In connection with the reverse merger in July 2017, the Company and two stockholders, who had provided related party advances to the Company, agreed to exchange their related party advances for 6% Convertible Promissory Notes that were originally due on January 15, 2018 (the “Notes”) in the amount of $68,077. From August 2017 through November 2017, the Company issued additional notes to four different parties (two of which were related parties) in the principal amount of $100,000 ($70,000 to related parties). In January 2018, the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019. The Notes bear simple interest at 6% unless the Company defaults, which increases the interest rate to 10%. The Holders, at their option, can elect to convert the principal plus any accrued interest, into shares of the Company’s common stock at a conversion rate equal to eighty percent (80%) of the average closing share price as quoted on the OTC Markets for the five (5) trading days prior to the date of conversion. There are two notes that had a maturity date of June 30, 2019, with the remaining notes having a maturity date of December 31, 2019. These notes have not been extended and are currently in default. The Company has classified these notes as current liabilities. The Company has accrued the default interest on the two notes from July 1, 2019 through December 31, 2020.

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SUMMARY OF CARRYING VALUE OF CONVERTIBLE DEBT (Details) (Parenthetical)		1 Months Ended		3 Months Ended	4 Months Ended	12 Months Ended
	Mar. 05, 2021 USD ($) shares	Jan. 31, 2018	Jul. 31, 2017 USD ($)	Mar. 31, 2021 shares	Nov. 30, 2017 USD ($)	Dec. 31, 2020 Integer	Dec. 31, 2018 USD ($)	Dec. 31, 2019 USD ($)
Defined Benefit Plan Disclosure [Line Items]
Accrued Interest								$ 12,392
Conversion of common stock | shares	43,990			181,250
Two Stockholders [Member] | Convertible Promissory Notes [Member]
Defined Benefit Plan Disclosure [Line Items]
Debt instrument, interest rate, stated percentage			6.00%			6.00%
Debt due date			Jan. 15, 2018			Dec. 31, 2019
Debt instrument, face value			$ 68,077
Debt maturity description		the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019.
Debt interest rate increases during the period						10.00%
Debt into shares of common stock at conversion rate						80.00%
Debt trading days | Integer						5
Two Stockholders [Member] | 10% Convertible Promissory Note [Member]
Defined Benefit Plan Disclosure [Line Items]
Debt maturity description		the holders of the Notes agreed to extend the maturity to April 30, 2018, and in April 2018, agreed to further extend the maturity of certain notes to June or July 2018. During the year ended December 31, 2018, the maturity of the notes were further extended to March 31, 2019 and then again to periods ranging from June 30, 2019 to December 31, 2019.
Four Related Parties [Member] | Convertible Promissory Notes [Member]
Defined Benefit Plan Disclosure [Line Items]
Proceeds from convertible debt - related parties					$ 100,000
Related Parties [Member] | Convertible Promissory Notes [Member]
Defined Benefit Plan Disclosure [Line Items]
Proceeds from convertible debt - related parties					$ 70,000
Related Parties [Member] | Convertible Notes [Member]
Defined Benefit Plan Disclosure [Line Items]
Issuance of conversion in excess of fair value	$ 156,250
Accrued Interest	$ 31,046
Conversion of common stock | shares	187,296
Satinder Thiara And Dharam V Sikka [Member]
Defined Benefit Plan Disclosure [Line Items]
Proceeds from convertible debt - related parties							$ 25,000
Debt maturity description							initially maturing on December 31, 2018, which has been extended to March 31, 2019 and then again to December 31, 2019.
Satinder Thiara And Dharam Sikka [Member]
Defined Benefit Plan Disclosure [Line Items]
Debt maturity description							initially maturing on December 31, 2018, which has been extended to March 31, 2019 and then again to December 31, 2019.

XML

CURRENT PORTION - CONVERTIBLE DEBT – RELATED AND UNRELATED PARTIES (Details Narrative) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Short-term Debt [Line Items]
Interest expense	$ 2,539	$ 5,546	$ 6,932	$ 12,110
Convertible Promissory Notes [Member]
Short-term Debt [Line Items]
Interest expense	$ 5,499	$ 9,627	$ 19,361	$ 12,957

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SUMMARY OF STOCK OPTIONS (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
Equity [Abstract]
Number of Shares, Beginning balance	3,930,000
Weighted Average Exercise Price, Beginning balance	$ 0.0052
Number of Shares, Granted		3,930,000
Weighted Average Exercise Price, Granted		$ 0.0052
Number of Shares, Exercised
Weighted Average Exercise Price, Exercised
Number of Shares, Forfeited
Weighted Average Exercise Price, Forfeited
Number of Shares, Expired
Weighted Average Exercise Price, Expired
Number of Shares, Ending balance	3,930,000	3,930,000
Weighted Average Exercise Price, Ending balance	$ 0.0052	$ 0.0052
Intrinsic value of options	$ 5,874,475	$ 6,267,475
Weighted Average Remaining Contractual Life (Years)	9 years 3 months 21 days	9 years 9 months 21 days

XML

STOCKHOLDERS’ EQUITY (DEFICIT) (Details Narrative)												1 Months Ended		3 Months Ended		6 Months Ended	12 Months Ended
	May 16, 2021 shares	Mar. 08, 2021 USD ($) $ / shares shares	Mar. 05, 2021 USD ($) shares	Feb. 17, 2021 USD ($) $ / shares shares	Feb. 17, 2021 USD ($) $ / shares shares	Feb. 16, 2021 USD ($) $ / shares shares	Feb. 16, 2021 USD ($) $ / shares shares	Oct. 19, 2020 shares	May 16, 2019 USD ($) shares	Aug. 02, 2017 USD ($) $ / shares shares	Jul. 19, 2017 shares	Mar. 31, 2021 USD ($) shares	Jan. 31, 2021 USD ($) shares	Jun. 30, 2021 USD ($) $ / shares shares	Mar. 31, 2021 USD ($) shares	Jun. 30, 2021 USD ($) Integer $ / shares shares	Dec. 31, 2020 USD ($) Integer $ / shares shares	Dec. 31, 2019 $ / shares shares	Mar. 02, 2021	Jun. 30, 2020 shares	May 31, 2019 shares
Class of Stock [Line Items]
Number of common stock value issued during period | $														$ 38,500	$ 456,000
Preferred stock, par value | $ / shares														$ 0.0001		$ 0.0001	$ 0.0001	$ 0.0001
Common stock, shares issued														31,430,575		31,430,575	27,297,960	27,297,960		0
Common stock, shares outstanding														31,430,575		31,430,575	27,297,960	27,297,960		0
Shares of stock issued for services rendered, shares												61,500	37,500
Value of shares issued for service | $												$ 70,725	$ 52,500	$ 1,750	436,385
Stock based compensation | $																$ 226,807	$ 104,638
Increase in additional paid in capital | $															$ 68,642
Stock option granted																	3,930,000
Stock based compensation unregognised | $																	$ 660,372
Stock option granted vested														312,500		312,500	312,500
Conversion of notes payable			43,990												181,250
Accrued interest | $			$ 43,438									$ 43,438			$ 43,438
TRAQIQ Solutions Private Limited [Member]
Class of Stock [Line Items]
Percentage of voting interest acquired																					100.00%
Warrants term																					5 years
Number of warrant issued																					1,329,272
MIMO Technologies PVT Ltd [Member]
Class of Stock [Line Items]
Note receivable written off | $				$ 258,736
Accounts receivable written off | $				123,778
Debenture written off | $				40,354
Cash payment to minority shareholders | $				$ 22,338
Rohuma, LLC [Member]
Class of Stock [Line Items]
Shares of stock issued for acquisition of Rohuma (first tranche), shares															4,292,220
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Class of Stock [Line Items]
Warrants term				3 years	3 years
Number of warrant issued				1,367,539	1,367,539
Number of warrants earned				820,524	820,524
Remaining warrants expected to be earned				547,015	547,015
Warrants exercise price | $ / shares				$ 0.001	$ 0.001
Amount of warrants outstanding | $				$ 1,640,447	$ 1,640,447
Ownership interest percentage																			99.00%
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Class of Stock [Line Items]
Number of common stock value issued during period | $					$ 22,338
Warrants term				3 years	3 years
Number of warrant issued				1,367,539	1,367,539
Number of warrants earned				820,524	820,524
Remaining warrants expected to be earned				547,015	547,015
Warrants exercise price | $ / shares				$ 0.001	$ 0.001
Amount of warrants outstanding | $				$ 1,640,447	$ 1,640,447
Ownership interest percentage				99.00%	99.00%
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member]
Class of Stock [Line Items]
Percentage of voting interest acquired									100.00%
Warrants term									5 years
Number of warrant issued									1,329,272
Warrants to purchase common stock, value | $									$ 268
Increase in additional paid in capital | $									$ 268
Cancelled warrants	419,127
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member] | Immediately Upon Closing [Member]
Class of Stock [Line Items]
Number of warrant issued									100,771
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member] | One Year After The Date Of Closing [Member]
Class of Stock [Line Items]
Number of warrant issued									859,951			859,951			859,951
Share Exchange Agreement [Member] | TRAQIQ Solutions Private Limited [Member] | Two Years After The Date Of Closing [Member]
Class of Stock [Line Items]
Number of warrant issued									368,550
Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Class of Stock [Line Items]
Percentage of voting interest acquired				1.00%	1.00%
Share Exchange Agreement [Member] | Rohuma, LLC [Member]
Class of Stock [Line Items]
Percentage of voting interest acquired																			1.00%
Stock Purchase Agreements [Member]
Class of Stock [Line Items]
Number shares issued during period						570,000	570,000
Shares issued price per share | $ / shares						$ 0.80	$ 0.80
Number of common stock value issued during period | $						$ 456,000	$ 456,000
Warrants term						3 years	3 years
Number of warrant issued						285,000	285,000
Warrants exercise price | $ / shares						$ 2.00	$ 2.00
Consulting Agreement [Member]
Class of Stock [Line Items]
Number shares issued during period		100,000
Number of common stock value issued during period | $		$ 25,000
Warrants term		3 years
Stock based compensation unregognised | $		$ 3,000
Warrants exercise price | $ / shares		$ 2.00
Common Stock [Member]
Class of Stock [Line Items]
Number shares issued during period														35,000	570,000
Number of common stock value issued during period | $														$ 4	$ 57
Shares of stock issued for services rendered, shares														1,000	400,000
Value of shares issued for service | $															$ 40
Increase in additional paid in capital | $
Shares of stock issued for conversion of notes payable and accrued interest, shares															264,338
Shares of stock issued for acquisition of Rohuma (first tranche), shares															2,562,277
Common Stock [Member] | Restricted Stock [Member]
Class of Stock [Line Items]
Share-based payment award authorized														350,000		350,000
Additional Paid-in Capital [Member]
Class of Stock [Line Items]
Number of common stock value issued during period | $														$ 38,496	$ 455,943
Value of shares issued for service | $														1,750	436,345
Increase in additional paid in capital | $															$ 68,642
Additional Paid-in Capital [Member] | Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Class of Stock [Line Items]
Amount of warrants outstanding | $				$ 984,268	$ 984,268
Additional Paid-in Capital [Member] | Share Exchange Agreement [Member] | MIMO Technologies PVT Ltd [Member]
Class of Stock [Line Items]
Amount of warrants outstanding | $				$ 984,268	$ 984,268
Advisor [Member] | Restricted Stock [Member]
Class of Stock [Line Items]
Stock based compensation | $														$ 40,222
Share-based Compensation Arrangement by Share-based Payment Award, Description														three-year term.
Advisor [Member] | Common Stock [Member] | Restricted Stock [Member]
Class of Stock [Line Items]
Share-based payment award issued in period														0
Director [Member] | Common Stock [Member]
Class of Stock [Line Items]
Short-term debt, lender														director for agreeing to lend the Company $400,000 in a promissory note
Director [Member] | Common Stock [Member] | Restricted Stock [Member]
Class of Stock [Line Items]
Shares award issued in period														300,000
Shares may be return in period														150,000
Shares value award issued in period | $														$ 447,000
Board Members, Advisory Board Members, Employees and Consultants [Member]
Class of Stock [Line Items]
Stock option granted								3,930,000
Stock option term								10 years
Series A Convertible Preferred Stock [Member]
Class of Stock [Line Items]
Conversion price description																(i) eighty five percent (85%) of the average closing bid price of the Common Stock over the twenty (20) trading days immediately preceding the date of conversion, (ii) but no less than par value of the Common Stock. For purposes of determining the closing bid price on any day, reference shall be to the closing bid price for a share of Common Stock on such date on the OTC Markets, as reported on Bloomberg, L.P. (or similar organization or agency succeeding to its functions of reporting prices) (the “Per Share Market Value”).	(i) eighty five percent (85%) of the average closing bid price of the Common Stock over the twenty (20) trading days immediately preceding the date of conversion, (ii) but no less than par value of the Common Stock. For purposes of determining the closing bid price on any day, reference shall be to the closing bid price for a share of Common Stock on such date on the OTC Markets, as reported on Bloomberg, L.P. (or similar organization or agency succeeding to its functions of reporting prices) (the “Per Share Market Value”).
Convertible debt percentage																85.00%	85.00%
Debt trading days | Integer																20	20
Series A Convertible Preferred Stock [Member] | Minimum [Member]
Class of Stock [Line Items]
Preferred stock, par value | $ / shares																	$ 500
Series A Convertible Preferred Stock [Member] | Chief Executive Officer [Member]
Class of Stock [Line Items]
Number shares issued during period										50,000	50,000
Shares issued price per share | $ / shares										$ 0.20
Number of common stock value issued during period | $										$ 10,000

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SCHEDULE OF REMAINING LEASE OBLIGATION (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020
Operating Lease
2022	$ 13,209
2023	28,593	$ 26,087
2024	28,593	29,091
2025	29,487	29,091
2026	32,882	30,000
2027	58,914	33,455
2026 and thereafter		59,940
Total lease payments	191,678	207,663
Less: Imputed interest	63,759	73,665
Present value of lease liabilities	$ 127,919	$ 133,998

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OPERATING LEASE (Details Narrative) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019	May 17, 2019
Restructuring Cost and Reserve [Line Items]
Lease right of use asset	$ 118,237		$ 126,118	$ 537,268
Lease liability	127,919		133,998
Operating lease, right-of-use asset, amortization expense	592,909		592,909
Rent expense			100,079	$ 74,214
Impaired right-of-use asset			333,571
Impaired lease liability			$ 349,428
Operating Leases, Rent Expense	$ 15,511	$ 63,895
TRAQIQ Solutions Private Limited [Member]
Restructuring Cost and Reserve [Line Items]
Lease right of use asset					$ 576,566
Lease liability					$ 585,207

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CONCENTRATIONS (Details Narrative) - Customer Concentration Risk [Member]	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Revenue Benchmark [Member] | Two Major Customers [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	87.00%	88.00%	85.00%	82.00%
Accounts Receivable [Member] | Two Customers [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	87.00%		85.00%	67.00%

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CONTINGENCY (Details Narrative)	12 Months Ended
	Dec. 31, 2018 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Loss contingency pursuant to agreement with driver	$ 190,000
Loss contingency, eligibility of company fees, per day	$ 800

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SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION (Details)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Federal income taxes at statutory rate	21.00%	21.00%
State income taxes at statutory rate	7.50%	7.50%
Temporary differences	0.38%	(0.82%)
Permanent differences	(0.98%)	(7.41%)
Change in valuation allowance	(27.90%)	(20.27%)
Totals	0.00%	0.00%

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SCHEDULE OF DEFERRED TAX ASSETS (Details) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Restructuring Cost and Reserve [Line Items]
NOL carryforward (based on last tax return filed per Indian Income Tax laws)	$ 747,748	$ 579,118
Stock-based compensation	28,174
Depreciation	(1,616)	(1,616)
Net Deferred Tax Assets	774,306	577,502
Less: Valuation allowance	(774,306)	(577,502)
Net Deferred Tax Asset
India Based Entity [Member]
Restructuring Cost and Reserve [Line Items]
NOL carryforward (based on last tax return filed per Indian Income Tax laws)	43,140	11,404
Net Deferred Tax Assets	148,043	110,150
Less: Valuation allowance	(148,043)	(110,150)
Net Deferred Tax Asset
Difference between book and tax base of fixed assets	43,868	56,696
Provision for gratuity	27,189	22,253
Provision for leave encashment	11,030	8,598
Operating lease	5,170	2,339
Timing difference on TDS under 40a(ia)	9,002
MAT credit	$ 8,644	$ 8,860

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PROVISION FOR INCOME TAXES (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Restructuring Cost and Reserve [Line Items]
Net operating loss carry forward	$ 2,777,151
Operating loss carry forward expiration, description	expiring through 2037.
Increased in valuation allowance	$ 196,804
Penalties or interest expensed	0	$ 0
Penalties or interest accrued	0	0
Deferred tax assets	774,306	577,502
India Based Entity [Member]
Restructuring Cost and Reserve [Line Items]
Deferred tax assets	$ 148,043	$ 110,150

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SCHEDULE OF EMPLOYEE GRATUITY PLANS (Details) - USD ($)	8 Months Ended		12 Months Ended
	Dec. 31, 2019	Dec. 31, 2019	Dec. 31, 2020
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Projected benefit obligation, beginning balance	$ 65,550		$ 85,594
Service cost	6,982		10,746
Interest cost	3,106		5,595
Benefits paid	(1,932)		(19,033)
Actuarial gain (loss) on the Obligation	13,086		23,761
Effect of exchange rate changes	(1,198)		(2,090)
Projected benefit obligation, ending balance	85,594	$ 85,594	104,573
Unfunded amount - non-current	74,781	74,781	94,023
Unfunded amount - current	10,813	10,813	10,550
Total accrued liability	$ 85,594	85,594	$ 104,573
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost : Discount rate	6.70%		5.55%
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost : Rate of increase in compensation levels	10.00%		10.00%
Other Long-term Employee Benefits - Leave Encashment [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Projected benefit obligation, beginning balance	$ 24,243		$ 33,070
Service cost	3,646		10,746
Interest cost	940		5,595
Benefits paid	(919)		(2,212)
Actuarial gain (loss) on the Obligation	5,617		(3,969)
Effect of exchange rate changes	(457)		(806)
Projected benefit obligation, ending balance	33,070	33,070	42,424
Unfunded amount - non-current	27,682	27,682	37,306
Unfunded amount - current	5,388	5,388	5,118
Total accrued liability	$ 33,070	33,070	$ 42,424
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost : Discount rate	6.70%		5.55%
The weighted average actuarial assumptions used to determine benefit obligations and net periodic gratuity cost : Rate of increase in compensation levels	10.00%		10.00%
Components of net period benefit costs [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Service cost	$ 6,982		$ 10,746
Interest cost	3,106		5,595
Actuarial gain (loss) on the Obligation	11,888		23,761
Components of net period benefit costs	$ 21,976		40,102
Components of net period benefit costs [Member] | Other Long-term Employee Benefits - Leave Encashment [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Service cost		3,646	10,746
Interest cost		940	5,595
Actuarial gain (loss) on the Obligation		5,160	(3,969)
Components of net period benefit costs		$ 9,746	$ 12,372

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COMMITMENTS AND CONTINGENCIES (Details Narrative) - Ministry of Finance, India [Member] - USD ($)	1 Months Ended
	Jan. 31, 2021	Dec. 31, 2020	Mar. 22, 2014
Operating Loss Carryforwards [Line Items]
Tax and penalty amount payable		$ 0
Gratuity outstanding		$ 23,971
Payments to gratuity	$ 13,816
Guarantee provided prior to acquisition			$ 165,813
Subsequent Event [Member]
Operating Loss Carryforwards [Line Items]
Payments to gratuity	$ 13,816

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SUBSEQUENT EVENTS (Details Narrative) - USD ($)										1 Months Ended		3 Months Ended			6 Months Ended		12 Months Ended
	Mar. 08, 2021	Mar. 05, 2021	Mar. 02, 2021	Feb. 17, 2021	Feb. 16, 2021	Feb. 16, 2021	Feb. 12, 2021	Jan. 22, 2021	Jan. 19, 2021	Mar. 31, 2021	Jan. 31, 2021	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Number of shares issued for services										61,500	37,500
Value of shares issued for services										$ 70,725	$ 52,500	$ 1,750	$ 436,385
Debt instrument discount amount												176,902			$ 176,902
Number of warrants granted for conversion		264,338
Value of shares issued for cash												38,500	456,000
Conversion of stock, amount converted		$ 181,250
Accrued interest		$ 43,438								$ 43,438			$ 43,438
Revenue												$ 937,002		$ 230,258	$ 1,319,388	$ 521,319	$ 1,009,949	$ 680,732
Service [Member]
Number of shares issued for services	25,000
Warrants term	3 years
Warrants exercise price	$ 2.00
Number of warrants issued	100,000
Revenue	$ 3,000
Warrants vesting date	Mar. 07, 2022
Stock Purchase Agreements [Member]
Number of shares issued as commitment fee					570,000	570,000
Shares issued, price per share					$ 0.80	$ 0.80
Warrants term					3 years	3 years
Warrants exercise price					$ 2.00	$ 2.00
Value of shares issued for cash					$ 456,000	$ 456,000
Number of warrants issued					285,000	285,000
GS Capital Partners, LLC [Member]
Number of shares issued for services									26,000
Rohuma, LLC [Member] | Share Exchange Agreement [Member]
Number ofcommon stock issued								4,292,220
Rohuma, LLC [Member] | Share Exchange Agreement [Member] | Share-based Payment Arrangement, Tranche One [Member]
Number ofcommon stock issued			2,562,277
Transaction value			$ 4,335,142
Shares issued, price per share			$ 1.01
Platinum Point Capital, LLC [Member]
Number of shares issued for services							60,000
Warrants term							3 years
Warrants exercise price							$ 2.00
Number of warrants issued												200,000			200,000
MIMO Technologies PVT Ltd [Member] | Share Exchange Agreement [Member]
Warrants term				3 years
Warrants exercise price				$ 0.001
Value of shares issued for cash				$ 22,338
Number of warrants issued				1,367,539
Convertible Promissory Notes [Member] | GS Capital Partners, LLC [Member]
Convertible debt percentage									12.00%
Debt instrument face amount									$ 125,000
Debt instrument periodic payment, description									The GS Note has a maturity of one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000.
Debt instrument, periodic payment									$ 20,000
Percentage of debt instrument conversion									66.00%
Debt instrument discount amount									$ 10,000
Proceeds for legal fees									$ 5,000
Number of shares issued as commitment fee									26,000
Number of shares issued returnable upon achievement									170,000
Convertible Promissory Notes [Member] | Platinum Point Capital, LLC [Member]
Convertible debt percentage							10.00%
Percentage of debt instrument conversion							70.00%
Number of shares issued as commitment fee							60,000
Debt instrument conversion price per share							$ 0.01
Number of warrants granted for conversion							200,000
Warrants term							3 years
Warrants exercise price							$ 2.00
Number of warrants issued							200,000

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SCHEDULE OF GOODWILL (Details) - USD ($)	Jun. 30, 2021	Feb. 17, 2021	Dec. 31, 2020
Net	$ 6,507,680	$ 2,085,653
Rohuma US [Member]
Net	3,519,869
MIMO Technologies PVT Ltd [Member]
Net	$ 2,987,811

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GOODWILL (Details Narrative)	6 Months Ended
	Jun. 30, 2021 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Impairment of goodwill	$ 0

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SCHEDULE OF CONVERTIBLE NOTES OUTSTANDING (Details) - USD ($)	Feb. 12, 2021	Jan. 19, 2021	Jun. 30, 2021		Dec. 31, 2020
Total Convertible Notes Payable			$ 505,000
Less: Debt Discount			(176,902)
Convertible Notes Payable Current			328,098
GS Capital Partners, LLC [Member]
Total Convertible Notes Payable			105,000	[1]
GS Capital Partners, LLC [Member] | Convertible Promissory Notes [Member]
Less: Debt Discount		$ (10,000)
Debt Instrument, Maturity Date, Description		one-year
Platinum Point Capital, LLC [Member]
Total Convertible Notes Payable			$ 400,000	[2]
Platinum Point Capital, LLC [Member] | Convertible Promissory Notes [Member]
Debt Instrument, Maturity Date, Description	one-year

[1] On January 19, 2021, the Company entered into a 12% Convertible Promissory Note with GS Capital Partners, LLC (the “GS Note”) in the amount of $125,000. The GS Note has a maturity of one-year and is to be repaid commencing on the fifth month anniversary and every month thereafter in the amount of $20,000. The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days. There are certain price protections for GS Capital Partners, LLC under the terms of the GS Note, which make the conversion option a derivative liability. The Company recorded an original issue discount in the amount of $10,000 and $5,000 was paid out of the proceeds for legal fees. In accordance with the terms of the GS Note, the Company issued 26,000 shares of common stock as a commitment fee and issued 170,000 shares of common stock that are returnable upon achievement of the terms of the GS Note.

[2] On February 12, 2021, the Company entered into a 10% Convertible Promissory Note with Platinum Point Capital, LLC (the “Platinum Note”). The Platinum Note has a maturity of one-year. The conversion price of the Platinum Note is the greater of (a) $0.01 or (b) 70% of the lowest closing stock price over the previous 15 trading days. There are certain price protections for Platinum Point Capital, LLC under the terms of the Platinum Note, which make the conversion option a derivative liability. The Company granted 200,000 warrants that have a term of three-years and an exercise price of $2.00 per share with the Platinum Note. The warrants granted with the Platinum Note also contain certain price protections, that make the value of the warrants a derivative liability. The Company and Platinum Point Capital, LLC entered into an amendment to exclude the Mimo warrants granted on February 17, 2021 from the price protections. In accordance with the terms of the Platinum Note, the Company issued 60,000 shares as a commitment fee.

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SCHEDULE OF CONVERTIBLE NOTES OUTSTANDING (Details) (Parenthetical)	Feb. 12, 2021 Integer $ / shares shares	Jan. 19, 2021 USD ($) Integer shares	Jun. 30, 2021 USD ($) shares	Dec. 31, 2020 USD ($)
Short-term Debt [Line Items]
Original issue discount | $			$ 176,902
Platinum Point Capital, LLC [Member]
Short-term Debt [Line Items]
Number of warrants issued | shares			200,000
Warrants term	3 years
Warrants exercise price | $ / shares	$ 2.00
Convertible Promissory Notes [Member] | GS Capital Partners, LLC [Member]
Short-term Debt [Line Items]
Debt instrument, interest rate, stated percentage		12.00%
Debt instrument face amount | $		$ 125,000
Periodic payment | $		$ 20,000
Percentage of stock price trigger		66.00%
Trading days | Integer		20
Original issue discount | $		$ 10,000
Payments for legal fees | $		$ 5,000
Shares of stock issued for conversion of notes payable and accrued interest, shares | shares		26,000
Stock issued during period returnable shares | shares		170,000
Convertible Promissory Notes [Member] | Platinum Point Capital, LLC [Member]
Short-term Debt [Line Items]
Debt instrument, interest rate, stated percentage	10.00%
Percentage of stock price trigger	70.00%
Trading days | Integer	15
Stock issued during period returnable shares | shares	60,000
Conversion price | $ / shares	$ 0.01
Number of warrants issued | shares	200,000
Warrants term	3 years
Warrants exercise price | $ / shares	$ 2.00

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CONVERTIBLE NOTES PAYABLE (Details Narrative) - USD ($)	6 Months Ended		12 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019
Short-term Debt [Line Items]
Interest expense	$ 158,537	$ 107,869	$ 228,748	$ 170,688
Amortization of discounts on debt	146,966
Convertible Notes Payable [Member]
Short-term Debt [Line Items]
Interest expense	$ 21,781	$ 0

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SCHEDULE OF COMMON STOCK WARRANTS (Details) - Warrants [Member] - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	1,329,272	1,329,272
Exercise price, beginning balance	$ 0.001	$ 0.001
Weighted-average remaining contractual life, outstanding beginning Balance	2 years 8 months 19 days	4 years 10 months 13 days
Aggregate intrinsic value of vested warrants outstanding beginning	$ 2,125,506
Weighted-average exercise price, outstanding beginning balance	$ 0.001	$ 0.001
Warrants granted	1,980,039
Warrants exercised
Warrants expired/cancelled	(419,127)
Weighted-average remaining contractual life, outstanding ending balance	2 years 8 months 23 days	3 years 10 months 13 days
Ending balance	2,880,184	1,329,272
Exercise price, ending balance		$ 0.001
Aggregate intrinsic value of vested warrants outstanding ending	$ 3,414,248	$ 2,125,506
Weighted-average exercise price, outstanding ending balance	$ 0.42	$ 0.001
Exercisable at ending	2,333,168
Exercisable Aggregate Intrinsic Value	$ 2,594,272
Exercisable weighted price per share	$ 0.52
Minimum [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Exercise price, Warrants granted	0.001
Exercise price, ending balance	0.001
Exercisable price per share	0.001
Maximum [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Exercise price, Warrants granted	2.00
Exercise price, ending balance	2.00
Exercisable price per share	$ 2.00

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SCHEDULE OF EACH OPTION WARRANT ESTIMATED USING THE BLACK-SCHOLES VALUATION MODEL (Details)	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020
Expected term	3 years
Expected volatility
Expected dividend yield
Risk-free interest rate
Minimum [Member]
Expected volatility	100.00%
Risk-free interest rate	15.00%
Maximum [Member]
Expected volatility	214.00%
Risk-free interest rate	0.58%

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SUMMARY OF STOCK OPTION (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020	Dec. 31, 2019
Equity [Abstract]
Number of Shares, Beginning balance	3,930,000
Weighted Average Exercise Price, Beginning balance	$ 0.0052
Number of Shares, Granted		3,930,000
Weighted Average Exercise Price, Granted		$ 0.0052
Number of Shares, Exercised
Weighted Average Exercise Price, Exercised
Number of Shares, Forfeited
Weighted Average Exercise Price, Forfeited
Number of Shares, Expired
Weighted Average Exercise Price, Expired
Number of Shares, Ending balance	3,930,000	3,930,000
Weighted Average Exercise Price, Ending balance	$ 0.0052	$ 0.0052
Intrinsic value of options	$ 5,874,475	$ 6,267,475
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term	9 years 3 months 21 days	9 years 9 months 21 days

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SCHEDULE OF VALUATION ASSUMPTIONS (Details)	6 Months Ended	12 Months Ended
	Jun. 30, 2021	Dec. 31, 2020
Measurement Input, Expected Term [Member]
Derivative [Line Items]
Derivative liabilities, fair value measurement input, term	1 year
Expected Volatility [Member]
Derivative [Line Items]
Derivative liabilities, fair value assumptions
Expected Volatility [Member] | Minimum [Member]
Derivative [Line Items]
Derivative liabilities, fair value assumptions	164
Expected Volatility [Member] | Maximum [Member]
Derivative [Line Items]
Derivative liabilities, fair value assumptions	214
Measurement Input, Expected Dividend Rate [Member]
Derivative [Line Items]
Derivative liabilities, fair value assumptions
Measurement Input, Risk Free Interest Rate [Member]
Derivative [Line Items]
Derivative liabilities, fair value assumptions	0.15

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SCHEDULE OF DERIVATIVE LIABILITIES (Details) - USD ($)	Jun. 30, 2021	Dec. 31, 2020
Derivative liability	$ 1,510,000
GS Capital Partners, LLC [Member]
Derivative liability	280,000
Platinum Point Capital, LLC [Member]
Derivative liability	1,024,000
Platinum Point Capital, LLC [Member] | Warrant [Member]
Derivative liability	$ 206,000

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SCHEDULE OF DERIVATIVE LIABILITIES (Details) (Parenthetical)	Jun. 30, 2021 shares
Platinum Point Capital, LLC [Member]
Number of warrants issued	200,000

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SCHEDULE OF ACTIVITY RELATED TO DERIVATIVE LIABILITIES (Details)	6 Months Ended
	Jun. 30, 2021 USD ($)
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Beginning balance as of December 31, 2020
Issuances of warrants/conversion option – derivative liabilities	313,868
Warrants exchanged for common stock
Change in fair value of warrants/conversion option - derivative liabilities	1,196,132
Ending balance as of June 30, 2021	$ 1,510,000

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DERIVATIVE LIABILITIES (Details Narrative) - USD ($)			1 Months Ended
	Feb. 12, 2021	Jan. 19, 2021	Mar. 31, 2021	Jan. 31, 2021	Jun. 30, 2021	Dec. 31, 2020
Convertible promissory note					$ 328,098
Number of shares issued as commitment fee			61,500	37,500
GS Capital Partners, LLC [Member]
Original issue discount		$ 10,000
Legal fees		$ 5,000
Number of shares issued as commitment fee		26,000
GS Capital Partners, LLC [Member] | Returnable Upon Achievement [Member]
Shares of stock issued for cash, shares		170,000
Platinum Point Capital, LLC [Member]
Number of shares issued as commitment fee	60,000
Number of warrants granted	200,000
Warrant term	3 years
Warrant exercise price	$ 2.00
10% Convertible Promissory Note [Member] | GS Capital Partners, LLC [Member]
Convertible promissory note		$ 125,000
Debt Instrument, Maturity Date, Description		one-year
10% Convertible Promissory Note [Member] | GS Capital Partners, LLC [Member] | Every Month Thereafter [Member]
Monthly repayment		$ 20,000
Conversion price,description		The conversion price of the GS Note is 66% of the lowest closing stock price over the previous 20 trading days
10% Convertible Promissory Note [Member] | Platinum Point Capital, LLC [Member]
Debt Instrument, Maturity Date, Description	one-year
Conversion price,description	The conversion price of the Platinum Note is the greater of (a) $0.01 or (b) 70% of the lowest closing stock price over the previous 15 trading days