UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the Quarterly Period Ended September 30, 2023

or

☐     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934.

Commission File Number: 000-56266

VEMANTI GROUP, INC.

(Exact name of registrant as specified in its charter)

Nevada	46-5317552
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

7545 Irvine Center Dr., Ste 200, Irvine, CA 92618

(Address of principal executive offices) (Zip Code)

(949) 559-7200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	N/A	N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter periods that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File to be submitted posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large, accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company filer. See definition of “large, accelerated filer,” “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 check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of November 14, 2023, the registrant had 72,315,503 shares of common stock issued and outstanding.

VEMANTI GROUP, INC.

QUARTERLY REPORT ON FORM 10-Q

September 30, 2023

TABLE OF CONTENTS

		PAGE
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	F-1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	8
Item 4.	Controls and Procedures	8
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	9
Item 1A.	Risk Factors	9
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	9
Item 3.	Defaults Upon Senior Securities	9
Item 4.	Mine Safety Disclosure	9
Item 5.	Other Information	9
Item 6.	Exhibits	10
SIGNATURES		11

- 2 -

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such forward-looking statements include, among others, those statements including the words “believes”, “anticipates”, “expects”, “intends”, “estimates”, “plans” and words of similar import. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

Forward-looking statements are based on our current expectations and assumptions regarding our business, potential target businesses, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. We caution you therefore that you should not rely on any of these forward-looking statements as statements of historical fact or as guarantees or assurances of future performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements include changes in local, regional, national or global political, economic, business, competitive, market (supply and demand) and regulatory conditions.

A description of these and other risks and uncertainties that could affect our business appears in the section captioned “Risk Factors” in our Annual Report on Form 10-K which we filed with the Securities and Exchange Commission (“SEC”) on March 30, 2023 (the “Form 10-K”). The risks and uncertainties described under “Risk Factors” are not exhaustive.

Given these uncertainties, readers of this Quarterly Report on Form 10-Q (“Quarterly Report”) are cautioned not to place undue reliance on such forward-looking statements. We disclaim any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.

- 3 -

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and the rules of the SEC and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in our Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.

VEMANTI GROUP, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2023 (UNAUDITED)

INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Condensed Consolidated Balance Sheets at September 30, 2023 (Unaudited) and December 31, 2022	F-2
Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2023 and 2022 (Unaudited)	F-3
Condensed Consolidated Statements of Changes in Shareholders’ Equity for the nine months ended September 30, 2023 and 2022 (Unaudited)	F-4
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2023 and 2022 (Unaudited)	F-5
Notes to Condensed Consolidated Financial Statements (Unaudited)	F-6

F-1

VEMANTI GROUP, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30, 2023			December 31, 2022
ASSETS
Current Assets:
Cash	$	180,809		$	257,512
Accounts Receivable, net		18,766			889
Prepaid Expenses		-			242,307
Total Current Assets		199,575			500,708
Non-Current Assets:
Intangible Assets, net		281,352			305,469
Total Non-Current Assets		281,352			305,469
TOTAL ASSETS	$	480,927		$	806,177
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable	$	16,502		$	6,262
Accrued Interest Payable		8,343			1,250
Accrued Expenses		109,446			191,470
Note Payable		154,995			-
Loan from Stockholder		125,000			125,000
Total Current Liabilities		414,286			323,982
TOTAL LIABILITIES		414,286			323,982
STOCKHOLDERS' EQUITY
Preferred Stock, $0.0001 par value, 50,000,000 shares authorized; 40,000,000 shares issued and outstanding.		4,000			4,000
Common Stock, $0.0001 par value, 500,000,000 shares authorized; 71,865,503 and 70,351,709 shares issued and outstanding as of September 30, 2023, and December 31, 2022, respectively.		7,187			7,035
Additional Paid-in-Capital		5,291,346			4,793,468
Accumulated Deficit		(5,235,892	)		(4,322,308	)
Total Stockholders' Equity		66,641			482,195
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	480,927		$	806,177
The accompanying notes are an integral part of these condensed consolidated financial statements.

F-2

VEMANTI GROUP, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 (Unaudited)

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2023			2022			2023			2022
Sales	$	33,192		$	35,099		$	105,417		$	108,880
Cost of Sales		6,160			5,229			17,052			17,402
Gross Margin		27,032			29,870			88,365			91,478
Operating Expenses:
General and Administrative		230,654			239,870			965,993			862,644
Amortization		8,039			8,039			24,117			8,039
Total Operating Expenses		238,693			247,909			990,110			870,683
Loss from Operations		(211,661	)		(218,039	)		(901,745	)		(779,205	)
Other Income (Expense):
Other Income		-			877			1,104			1,547
Interest Expense		(7,082	)		(19	)		(12,099	)		(32	)
Impairment of digital assets		-			-			-			(221	)
Total Other Income (Expense)		(7,082	)		858			(10,995	)		1,294
Loss before Provision for Income Taxes		(218,743	)		(217,181	)		(912,740	)		(777,911	)
Provision for Income Taxes		844			-			844			-
Net Loss	$	(219,587	)		(217,181	)	$	(913,584	)		(777,911	)
Loss per Share:
Basic	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.01	)
Diluted	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.01	)
Weighted Average Shares Outstanding:
Basic		71,808,948			69,179,880			71,213,807			70,617,169
Diluted		71,808,948			69,179,880			71,213,807			70,617,169
The accompanying notes are an integral part of these condensed consolidated financial statements.

F-3

VEMANTI GROUP, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

For the Nine Months Ended September 30, 2023	Preferred Stock				Common Stock				Additional Paid-in		Accumulated			Total Stockholders'
	Shares		Amount		Shares		Amount		Capital		Deficit			Equity
Balance, December 31, 2022		40,000,000	$	4,000		70,351,709	$	7,035	$	4,793,468	$	(4,322,308	)	$	482,195
Stock Issued for Cash		-		-		468,794		47		99,953		-			100,000
Stock Issued for Services		-		-		1,045,000		105		397,925		-			398,030
Net Loss		-		-		-		-		-		(913,584	)		(913,584	)
Balance, September 30, 2023		40,000,000	$	4,000		71,865,503	$	7,187	$	5,291,346	$	(5,235,892	)	$	66,641

For the Nine Months Ended September 30, 2022	Preferred Stock				Common Stock						Additional Paid-in		Accumulated			Total Stockholders'
	Shares		Amount		Shares			Amount			Capital		Deficit			Equity
Balance, December 31, 2021		40,000,000	$	4,000		70,404,086		$	7,040		$	3,344,890	$	(3,284,087	)	$	71,843
Stock Issued for Cash		-		-		631,530			63			337,437		-			337,500
Stock Issued for Services		-		-		1,224,242			123			670,922		-			671,045
Stock cancelled		-		-		(3,090,000	)		(309	)		309		-			-
Net Loss		-		-		-			-			-		(777,911	)		(777,911	)
Balance, September 30, 2022		40,000,000	$	4,000		69,169,858		$	6,917		$	4,353,558	$	(4,061,998	)	$	302,477
The accompanying notes are an integral part of these condensed consolidated financial statements.

F-4

VEMANTI GROUP, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Nine Months Ended September 30,
	2023			2022
Cash Flows from Operating Activities:
Net Loss	$	(913,584	)	$	(777,911	)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Depreciation		-			556
Amortization		24,117			8,039
Loss on Sale of Digital Assets		-			221
Stock-Based Compensation		316,006			686,154
Amortization of Debt Discount		4,995			-
Changes in Assets and Liabilities:
Accounts Receivable		(17,877	)		(8,463	)
Prepaid Expenses		242,307			(233,905	)
Accounts Payable		10,240			4,471
Accrued Interest Payable		7,093			-
Net Cash used in Operating Activities		(326,703	)		(320,838	)
Cash Flows from Investing Activities:
Sale of Digital Assets		-			5,886
Net Cash provided by Investing Activities		-			5,886
Cash Flows from Financing Activities:
Note Payable		150,000			-
Issuance of Common Stock for Cash		100,000			337,500
Net Cash provided by Financing Activities		250,000			337,500
Net Increase (Decrease) in Cash		(76,703	)		22,548
Cash, Beginning of the Period		257,512			295,937
Cash, End of the Period	$	180,809		$	318,485
Supplemental disclosure of cash flow information
Cash paid for:
Interest	$	-		$	32
Income taxes	$	-		$	-
Supplemental disclosure of non-cash flow investing and financing activites:
Exchange of Due from Fvndit for intangible assets	$	-		$	25,142
Exchange of intangible assets for assets	$	-		$	321,547
Exchange of Investment in Fvndit for intangible assets	$	-		$	296,405
Accrued stock-based compensation	$	82,024		$	-
The accompanying notes are an integral part of these condensed consolidated financial statements.

F-5

VEMANTI GROUP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE 1 - Summary of Significant Accounting Policies

Basis of Presentation

These unaudited condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements in our Annual Report on Form 10-K, which we filed with the Securities and Exchange Commission (“SEC”) on March 30, 2023, and notes thereto.  In preparing these unaudited condensed consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the unaudited condensed consolidated financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates. The most significant estimates and assumptions included in the Company’s unaudited condensed consolidated financial statements relate to allowances for doubtful accounts, valuation allowance for deferred income taxes and recoverability of intangible assets.

Reclassification

Certain amounts reported in the prior year condensed consolidated financial statements have been reclassified to conform to the current year’s presentation.

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, VoiceStep. All significant intercompany transactions and balances have been eliminated. On March 1, 2022, a resolution was approved by the Board of Directors to dissolve Vemanti Digital Ltd. On April 28, 2022, Vemanti Digital was formally dissolved.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates made by management include, among others, allowances for doubtful accounts, valuation allowance for deferred income taxes and recoverability of intangible assets. Actual results could differ from those estimates. It is possible that accounting estimates and assumptions may be material to the Company due to the levels of subjectivity and judgment involved.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and cash in time deposits, certificates of deposit, and all highly liquid debt instruments with original maturities of three months or less. As of September 30, 2023, and December 31, 2022, the Company had no cash equivalents.

Accounts Receivables

The Company regularly reviews its accounts receivable for collectability and establishes an allowance for doubtful accounts as necessary using the allowance method. The receivables are not collateralized.  

The Company estimates the ability to collect receivables by performing ongoing credit evaluations of its customers’ financial condition. Estimates are based on assumptions and other considerations, including payment history, credit ratings, customer financial performance, industry financial performance and aging analysis. The Company reviews its accounts receivable by aging category and to identify customers with known disputes or collection issues. In determining the allowance, the Company makes judgments about the creditworthiness of a majority of its customers based on ongoing credit evaluations. The Company also considers its historical level of credit losses and current economic trends that might impact the level of future credit losses. Accounts receivables are written-off when they are deemed uncollectible. As of September 30, 2023, and December 31, 2022, the Company had allowance for doubtful accounts in the amount of $3,489 and $3,842, respectively.

F-6

VEMANTI GROUP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (Unaudited)

Equipment

Equipment was stated at cost. Expenditures for maintenance and repairs are charged to operations as incurred; additions, renewals and betterments are capitalized. When equipment is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gain or loss is included in operations. Depreciation of equipment was provided using the straight-line method for substantially all assets with estimated lives as follows:

Software licenses	5 years
Computer equipment	5 years

Equipment became fully depreciated as of December 31, 2022.

Intangible Assets

The Company holds intangible assets with finite lives. Intangible assets with finite useful lives are amortized over their respective estimated useful lives, ranging from three to ten years, based on a pattern in which the economic benefit of the respective intangible asset is realized.

Identifiable intangible assets recognized in conjunction with acquisitions are recorded at fair value. Significant unobservable inputs are used to determine the fair value of the identifiable intangible assets based on the income approach valuation model whereby the present worth and anticipated future benefits of the identifiable intangible assets were discounted back to their net present value.

The Company evaluates the recoverability of intangible assets whenever events or changes in circumstances indicate that an intangible asset carrying amount may not be recoverable. The Company annually evaluates the remaining useful lives of all intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization.

Long-Lived Assets

The Company applies the provisions of Accounting Standards Codification (“ASC”) Topic 360, Property, Plant, and Equipment, which addresses financial accounting and reporting for the impairment or disposal of long-lived assets. ASC 360 requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amounts. In that event, a loss is recognized based on the amount by which the carrying amount exceeds the fair value of the long-lived assets. Loss on long-lived assets to be disposed of is determined in a similar manner, except that fair values are reduced for the cost of disposal.  Based on its review at September 30, 2023, and December 31, 2022, the Company believes there was no impairment of its long-lived assets.

Revenue Recognition

The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers, the core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. To achieve this core principle, five basic criteria must be met before revenue can be recognized: (1) identify the contract with a customer; (2) identify the performance obligation(s) in the contract; (3) determine the transaction price; (4) allocate the transaction price to performance obligation(s) in the contract; and (5) recognize revenue when or as the Company satisfies a performance obligation.

The Company recognizes revenues derived from sub-leasing telecommunications infrastructure and the provision of telecommunications and colocation services. These revenues are accounted for as a single performance obligation satisfied over time because the customer simultaneously receives and consumes the benefits of the Company’s performance on a monthly basis. These arrangements stipulate monthly billing, and the Company has elected the “as invoiced” practical expedient to recognize revenue as the services are consumed as the Company has the right to payment in an amount that corresponds directly with the value of performance completed to date.

Taxes collected from customers and remitted to a governmental authority are reported on a net basis and are excluded from revenue. Most revenue is billed in advance on a fixed-rate basis. The remainder of revenue is billed in arrears on a transactional basis determined by customer usage.

The Company often bills customers for upfront charges. These charges relate to down payments or prepayments for future services or equipment and are influenced by various business factors including how the Company and customer agree to structure the payment terms. These payments are recognized as deferred revenue until the service is provided or equipment is delivered and installed. All ongoing fees are billed and recognized as revenue on a monthly basis as service is provided.  

F-7

VEMANTI GROUP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (Unaudited)

Stock-Based Compensation

The Company records stock-based compensation in accordance with Financial Accounting Standards Board (“FASB”) ASC Topic 718, Compensation – Stock Compensation. FASB ASC Topic 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the employee’s requisite service period. The Company recognizes in the condensed consolidated statements of operations the grant-date fair value of stock options and other equity-based compensation issued to employees and consultants. Nonemployee share-based payment equity awards are measured at the grant-date fair value of the equity instruments and recognized as an expense over the requisite service period.

Income Taxes

The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes. ASC 740 requires a company to use the asset and liability method of accounting for income taxes, whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all of, the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded.

Basic and Diluted Earnings (Loss) Per Share

Earnings (loss) per share is calculated in accordance with ASC Topic 260, Earnings Per Share. Basic earnings (loss) per share (“EPS”) is based on the weighted average number of common shares outstanding. Diluted EPS is based on the assumption that all dilutive convertible shares and stock options and warrants were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. There are no potentially dilutive securities outstanding during all periods presented.

Fair Value Measurements

The Company applies the provisions of ASC 820-10, ”Fair Value Measurements and Disclosures.” ASC 820-10 defines fair value and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The three levels of valuation hierarchy are defined as follows:

· Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets.

· Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

· Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.

For certain financial instruments, the carrying amounts reported in the balance sheets for cash, current liabilities, and notes payable each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. It is not practicable to estimate the fair value of the loan from stockholder due to its related party nature. At September 30, 2023 and December 31, 2022, the Company did not identify any assets or liabilities that are required to be presented on the balance sheet at fair value.

Recent Authoritative Guidance

Management does not believe any recently issued but not yet effective accounting pronouncement, if adopted, would have a material impact effect on the Company’s present or future financial statements. 

F-8

VEMANTI GROUP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE 2 – Digital Assets

The following represents the change in digital assets:

Cryptocurrencies	September 30, 2023		December 31, 2022
Beginning balance	$	-	$	6,107
Purchase (sale) of cryptocurrencies		-		(6,107	)
Impairment		-		-
Ending balance	$	-	$	-

The Company did not record fair value gains (losses) associated with its digital assets. Cryptocurrencies were classified as intangible assets, and the Company continuously tested these assets for impairment.

NOTE 3 – Stockholders’ Equity

Members’ Interest

VoiceStep is governed by the terms and conditions of the Limited Liability Company Agreement (the Agreement) dated May 3, 2005, as amended on January 27, 2014. VoiceStep shall continue until terminated in accordance with the terms of the Agreement or as provided by law, including events of dissolution. VoiceStep shall be dissolved only upon any of the following events: (i) the vote of Member(s) holding a majority to the dissolution and winding up of VoiceStep, (ii) the entry of a decree of judicial dissolution of VoiceStep and (iii) at any time there are no Member(s), subject to remedy within 90 days of occurrence of termination event by the last remaining Member in writing.

VoiceStep originally consisted of two Members each owning 50% of VoiceStep. On January 27, 2014, one of the members was bought out with the remaining member owning 100% of the membership interest in VoiceStep. On April 3, 2014, the remaining member exchanged his 100% interest in VoiceStep for 40,000,000 shares of Vemanti common stock.

Equity Commitment Agreement

On March 11, 2022, the Company entered into an Equity Investment Agreement (the “Equity Agreement”) with Alpha Sigma Capital Fund, LP (“Alpha Sigma Capital” or “Alpha”). The Equity Agreement outlines an investment structure of up to $2M from Alpha into the Company, allowing the Company to immediately accelerate its business initiatives with PVcomBank under its 10-year partnership agreement. On March 15, 2022, the Company received a Put Notice under this Equity Agreement of $200,000 from Alpha for which it issued 381,530 shares of common stock and a warrant allowing the investor to purchase up to $200,000 in common stock until its expiration under the terms described in the Equity Agreement.

On August 24, 2022, the Company engaged Network 1 Financial Securities, Inc. to act as its exclusive financial advisor on a capital raise of up to twenty million ($20,000,000) and its up list to the NASDAQ or NYSE.  As part of the agreement, the Company paid a non-refundable equity fee (the “Advisory Fee”) of seven hundred and fifty thousand shares (750,000) shares of common stock of the Company deliverable at the time of signing this engagement agreement and two hundred and fifty thousand (250,000) shares of common stock of the Company deliverable ninety (90) days after signing the engagement agreement.  As an additional compensation for Network 1’s services, the Company shall issue Network 1 at each closing, cashless warrants the number of shares of common stock of the Company equal to eight percent (8.0%) of the aggregate number of shares of common stock sold in each placement. No cashless warrants were issued to Network 1 as of September 30, 2023 and December 31, 2022.  The contract with Network 1 Financial Securities, Inc. ended on August 25, 2023 and was not extended.

Preferred stock

The Company has authorized the issuance of 50,000,000 shares of preferred stock, $0.0001 par value. At both September 30, 2023, and December 31, 2022, the Company had 40,000,000 shares of preferred stock issued and outstanding.

F-9

VEMANTI GROUP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (Unaudited)

The Articles of Incorporation were amended on May 1, 2014, designating 40,000,000 shares of authorized and issued preferred stock of the Company as “Series A Preferred Stock” with voting rights, preferences and powers such that each share of Series A Preferred Stock shall vote as a class on all issues to which shareholders of common stock have a right to vote but shall have ten (10) votes per share of Series A Preferred stock while the shares of Common Stock shall have one vote per share. There are 40,000,000 of Series A Preferred Stock outstanding.

Common stock

The Company has authorized the issuance of 500,000,000 shares of common stock, $0.0001 par value. At September 30, 2023, and December 31, 2022, the Company had  71,865,503 shares and 70,351,709 shares of common stock issued and outstanding, respectively.

During the nine months ended September 30, 2023, the Company issued 1,045,000 shares of its common stock valued at $398,030 to consultants in exchange for professional services. 

Stock Incentive Plan

On March 25, 2015, the Company adopted a stock incentive plan. This plan allows the Board of Directors to issue up to 5,000,000 shares of common stock to employees, directors, or consultants of the Company or its affiliates under terms determined by the Board of Directors. This plan automatically terminates ten years from its date of adoption. As of the date of this report, no stock has been issued under the 2015 Plan.

Time-Based Restricted Stock

Time-based restricted stock units (“RSU”) and restricted stock awards (“RSA”) granted to contractors and vendors typically vest over 3 to 4 years and are subject to forfeiture if employment terminates prior to the vesting or lapse of the restrictions, as applicable. RSUs are not considered issued or outstanding common stock until they vest. RSAs are considered issued and outstanding on the grant date and are subject to forfeiture if specified vesting conditions are not satisfied.

There are no issued or outstanding RSAs.  The following table summarizes the activity related to RSUs subject to time-based vesting requirements for the periods ended September 30, 2023 and 2022:

	As of September 30, 2023					As of September 30, 2022
	Number of Shares			Weighted Average Grant Date Fair Value		Number of Shares			Weighted Average Grant Date Fair Value
Non-Vested, as of December 31, 2022, and 2021		1,947,500		$	0.48		3,093,000		$	0.47
Granted		600,000		$	0.13		1,405,000		$	0.47
Vested		(1,022,500	)	$	0.31		(1,795,000	)	$	0.48
Forfeit		(225,000	)	$	0.33		(365,000	)	$	0.71
Non-Vested, as of September 30, 2023, and 2022		1,300,000		$	0.48		2,338,000		$	0.43

As of September 30, 2023, there was $650,195 of remaining unamortized stock-based compensation expense associated with RSUs, which will be recognized over a weighted average remaining service period of approximately 2 years.  The 1,300,000 outstanding non-vested and expected to vest RSUs have an aggregate intrinsic value of $234,000  and a weighted average remaining contractual term of 0.91 years.

NOTE 4 – Investment in Fvndit, Inc. (formerly Directus Holdings, Inc.)

On November 13, 2018, the Company purchased a 20% investment in Directus Holdings, Inc., which owns eLoan, JSC (“eLoan”), a fintech company based in Vietnam, for $300,000. Half of the investment was made through a cash payment of $150,000, and the remaining half of the investment was made through the issuance of 1,252,086 shares of Vemanti Group’s common stock to the Founders of eLoan. On December 19, 2018, Directus Holdings, Inc. filed a Certificate of Amendment to Articles of Incorporation to the State of Nevada for its corporation name to be changed to Fvndit, Inc.

F-10

VEMANTI GROUP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (Unaudited)

On October 5, 2020, Fvndit issued 500,000 shares of common stock to Tan Tran, CEO and majority shareholder of Vemanti. The issuance raised the total number of Fvndit outstanding shares to 40,500,000. Mr. Tran and Vemanti together owned 8,500,000 shares or 20.99% of total Fvndit outstanding shares at that time.

On March 16, 2021, Tan Tran resigned as an Officer and Director of Fvndit. On that same date, Fvndit issued 2,500,000 shares of common stock to Thomas Duc Tran (unaffiliated with Tan Tran), and appointed him as the Chairman, CEO, President, Secretary, and Treasurer of Fvndit. The issuance raised the total number of Fvndit outstanding shares to 43,000,000. As a result, Mr. Tran and Vemanti together held 19.77% of total Fvndit outstanding shares. This investment had been accounted for under the cost method of accounting since March 16, 2021.

On June 16, 2022, pursuant to the terms of a stock purchase agreement, Fvndit purchased from the Company all of the shares of Fvndit’s common stock then owned by the Company and certain accounts receivable of approximately $25,000 that were due from Fvndit to the Company. As a result of the sale, the Company no longer owns any shares of Fvndit (see note 5).

As of September 30, 2023, and December 31, 2022, this investment had a balance of $0.

NOTE 5 – Intangible Assets

On June 16, 2022, pursuant to the terms of a stock purchase agreement, Fvndit purchased from the Company all of the shares of Fvndit’s common stock then owned by the Company and certain accounts receivable that were due from Fvndit to the Company.  As consideration for the sale of the shares and the accounts receivable to Fvndit, the Company acquired all rights to certain proprietary information and copyrights associated with Fvndit’s online investment marketplace business in Vietnam, the right to the name Fvndit, ownership of the “fvndit.com” domain name, and certain information related to Fvndit’s customers.

The change in the intangible assets has been summarized under the following table for the nine-month period ended September 30, 2023:

Intangible Assets	September 30, 2023			December 31, 2022
Beginning balance	$	305,469		$	-
Acquired Intangible Assets:
Proprietary Information		-			321,547
Impairment		-			-
Amortization		(24,117	)		(16,078	)
Ending balance	$	281,352		$	305,469

The proprietary information has a useful life of 10 years and is amortized accordingly.

NOTE 6 – Related Party Transactions

The Company pays the health insurance premiums for the CEO and his family. The total of those health insurance premium payments for the three months and nine months ended September 30, 2023 were $5,757 and $14,170, respectively.  Such costs are reflected as a component of general and administrative expenses on the accompanying condensed consolidated statements of operations.  No other payments were made to the CEO in 2022 or for the nine months ended September 30, 2023.

The Company pays a member of the CEO’s family for technical services. The total of those payments for the three months and nine months ended September 30, 2023 were $10,500 and $31,500, respectively. Such costs are reflected as a component of general and administrative expenses on the accompanying condensed consolidated statements of operations. 

On August 6, 2021, the Company borrowed $125,000 from the CEO. The loan will mature and become payable 12 months from the date of signing. Interest at the rate of 1% will be accrued on the outstanding balance. This loan’s maturity date was subsequently extended to August 5, 2024.

F-11

VEMANTI GROUP, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE 7 – Commitments and Contingencies

Legal Proceedings

On June 29, 2021, the Company filed a complaint against Messrs. Chenyuan Anthony Chen and Ang Hu (the “Defendants”) in the Superior Court of the State of California, County of Orange (the “Complaint”). Pursuant to a Consulting Agreement dated April 1, 2019, by and among the Company and the Defendants (the “Consulting Agreement”), the Company issued to the Defendants 3,250,000 shares of the Company’s common stock (the “Consulting Shares”) as compensation for certain consulting services to be performed by the Defendants. Pursuant to the Complaint, the Company alleges that the Defendants breached the Consulting Agreement by failing to perform such consulting services and thereby seeks injunctive relief to restrain Defendants from sales of the Consulting Shares, the cancellation of the Consulting Shares, and compensatory damages and legal fees.  On July 11, 2022, the Company reached a legal settlement with the Defendants to have 3,090,000 of the Consulting Shares returned to the Company. The Consulting Shares have been cancelled as of September 29, 2022.

NOTE 8 – Note Payable

On May 9, 2023 (“Issue Date”), the Company entered into a senior promissory note with Firstfire Global Opportunities Fund, LLC (“Firstfire”), a Delaware limited liability company for the principal sum of $162,750 (the “Principal Amount”).  This Note was issued with an original issue discount in the amount of $12,750 (the “OID”) such that the actual amount of the purchase price is $150,000.  The Company shall pay interest on the unpaid Principal Amount at the rate of nine percent (9%) (the “Interest Rate”) per annum from the Issue Date until the note becomes due and payable.  The maturity date shall be twelve (12) months from the Issue Date (the “Maturity Date”), and is the date upon which the Principal Amount (which includes the OID) and any accrued and unpaid interest and other fees, shall be due and payable.

Firstfire has the right, on any calendar day, at any time on or following the date that is six (6) calendar months after the Issue Date to convert all or any portion of the then outstanding and unpaid Principal Amount and interest into fully paid and non-assessable shares of Common Stock at a conversion price of $0.225 per share.

Under the terms of the note, the Company is required to comply with certain financial and nonfinancial covenants.  Any failure by the Company to comply with these covenants and any other obligations under the agreement could result in an event of default, which allows Firstfire to accelerate the repayments of the amounts owed.  As of September 30, 2023, the Company is compliant with its financial covenants.

NOTE 9 – Other Transactions

As previously disclosed, on April 18, 2023, Vemanti Group, Inc., entered into a stock purchase agreement (the “Stock Purchase Agreement”) with Benjamin Liu and James Sun (the “Sellers”), as the sole shareholders of DevBlock Technologies, Inc., a Delaware corporation (the “Corporation”), whereby, on the terms and subject to the conditions stated therein, Vemanti will acquire the Corporation.

On July 1, 2023, Vemanti and the Sellers entered into that certain Amendment to the Stock Purchase Agreement (the “Amendment”), which amends the Stock Purchase Agreement to change the outside closing date in Section 7.01(c) of the Stock Purchase Agreement from June 30, 2023 to July 31, 2023.

On September 26, 2023, the Stock Purchase Agreement was terminated on the terms and subject to the conditions stated therein.

NOTE 10 – Subsequent Events

The Company has evaluated subsequent events through November 14, 2023, the date on which the accompanying condensed consolidated financial statements were available to be issued, and concluded that, no material subsequent events have occurred since September 30, 2023, that require recognition or disclosure in the consolidated financial statements except as follows:

On September 26, 2023, the Stock Purchase Agreement with DevBlock Technologies, Inc. was terminated on the terms and subject to the conditions stated therein.

On October 26, 2023, the Board authorized the issuance of 450,000 common shares in exchange for consulting services rendered to the Company.  

F-12

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Forward-Looking Statements

The following management’s discussion and analysis should be read in conjunction with our historical financial statements and the related notes thereto. The management’s discussion and analysis contain forward-looking statements, such as statements of our plans, objectives, expectations and intentions. Any statements that are not statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,” “intend,” “anticipate,” “target,” “estimate,” “expect” and the like, and/or future tense or conditional constructions (“will,” “may,” “could,” “should,” etc.), or similar expressions, identify certain of these forward-looking statements. These forward-looking statements are subject to risks and uncertainties, including those under “Risk Factors” in our Annual Report on Form 10-K, which we filed with the Securities and Exchange Commission (“SEC”) on March 30, 2023, that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. Our actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors. We do not undertake any obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this Quarterly Report.

Basis of Presentation

The following discussion highlights our results of operations and the principal factors that have affected our financial condition as well as our liquidity and capital resources for the periods described and provides information that management believes is relevant for an assessment and understanding of the statements of consolidated financial condition and results of operations presented herein. The following discussion and analysis are based on our unaudited condensed consolidated financial statements contained in this Quarterly Report, which we have prepared in accordance with United States generally accepted accounting principles. You should read the discussion and analysis together with such consolidated financial statements and the related notes thereto.

Overview

Vemanti, incorporated on April 3, 2014 under the laws of the State of Nevada, is a financial technology (fintech) company that seeks to generate revenues in the emerging markets of Vietnam and Southeast Asia. In particular, we intend to focus our future product and business development on digital banking platforms, fintech, and on applications using disruptive technologies aimed at making credit simpler and easier to access for small to medium enterprises (“SMEs”) in our target markets.

Until June 16, 2022, we also held an 18.6% ownership interest in Fvndit which, through its subsidiaries, operates an online short-term P2P financing platform for SMEs in Vietnam. On June 16, 2022, the Company executed and consummated the transactions contemplated by a stock purchase agreement (the “Stock Purchase Agreement”) entered into by and between the Company and Fvndit.  Pursuant to the terms of the Stock Purchase Agreement, Fvndit purchased from the Company all of the shares of Fvndit’s common stock then owned by the Company and certain accounts receivable of approximately $25,000 that were due from Fvndit to the Company in consideration for certain assets of Fvndit related to providing a peer-to-peer investment marketplace in Vietnam that matches companies needing working capital funds with investors wishing to provide those funds. As a result of the sale, the Company no longer owns any shares of Fvndit, and no longer holds the securities of any other entity other than those of our wholly owned subsidiary, VoiceStep.  

For the nine months ended September 30, 2023, and 2022, we recognized $105,417 and $108,880, respectively, in sales.  For the nine-month periods ended September 30, 2023, and 2022, we incurred a net loss of $913,584 and $777,911, respectively.

As reflected in the unaudited condensed consolidated interim financial statements, we used cash in operations of $326,703 and had a net loss from operations of $901,745 and an accumulated deficit of $5,235,892 as of and for the nine months ended September 30, 2023.

While we believe in the viability of our strategy to generate sufficient revenues and in our ability to raise additional funds, there can be no assurances that we will be successful or that our cash position will be sufficient to support our daily operations. Our continued existence is dependent upon our ability to continue to execute our operating plan and to obtain additional debt or equity financing. There can be no assurance the necessary debt or equity financing will be available or will be available on terms acceptable to our Company. Accordingly, we may decide to exit our existing business and explore potential strategic alternatives, including establishing a new business, or target an existing business for acquisition, without restriction to any specific business, industry or geographical location. 

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Recent Developments

SAAS Agreement

On March 3, 2023, we entered into a Framework SaaS Agreement (the “SaaS Agreement”) with Finastra International Limited, a limited corporation organized under the laws of Wales and the United Kingdom (“Finastra”). The SaaS Agreement will only become effective upon our shares being listed on the Nasdaq Capital Market on or before May 22, 2023 and will have a term of seven years. If we are not successful in having its shares listed on the Nasdaq Capital Market on or before May 22, 2023, the SaaS Agreement has no force and effect.

On May 31, 2023, the Company executed a variation agreement extending the Effective Date of the SaaS agreement to June 22, 2023 (the “Extension”). Except as modified by the Extension, all terms and conditions of the SaaS Agreement shall remain in full force and effect.  As of this filing, the parties remain committed to honoring the contract when the Company’s shares are listed on the Nasdaq Capital Market.

If the SaaS Agreement becomes effective, Finastra will license its software and provide development services, SaaS services, maintenance services and other services to us.

Stock Purchase Agreement

On April 18, 2023, Vemanti Group, Inc., entered into a stock purchase agreement (the “Stock Purchase Agreement”) with Benjamin Liu and James Sun (the “Sellers”), as the sole shareholders of DevBlock Technologies, Inc., a Delaware corporation (the “Corporation”), whereby, on the terms and subject to the conditions stated therein, Vemanti will acquire the Corporation.

The Corporation is a technology platform and development company based in Seattle, Washington that specializes in artificial intelligence, machine learning, blockchain, and cloud computing. 

This transaction was expected to close on June 30, 2023, but the parties extended until July 31, 2023.  On September 26, 2023, the Stock Purchase Agreement was terminated on the terms and subject to the conditions stated therein.

Results of Operations

The nine months ended September 30, 2023, compared to the nine months ended September 30, 2022

	2023			2022
	Amount			Amount
Sales	$	105,417		$	108,880
Cost of Sales		17,052			17,402
Gross Profit		88,365			91,478
Total Other Income (Expense)		(10,995	)		1,294
Total Operating Expenses		990,110			870,683
Income Taxes		844			-
Net Loss	$	(913,584	)	$	(777,911	)

Revenues

Revenues were $105,417 for the nine months ended September 30, 2023, a decrease of $3,463 or 3.2%, compared to $108,880 in the same period of last year. The slight decrease was due to lower call usage.

Gross Profit and Gross Profit Margin

Gross profit was $88,365 for the nine months ended September 30, 2023, compared to $91,478 in the same period of 2022.  The decrease was due to lower revenues from lower call volume. Gross margin was 84% for the nine months ended September 30, 2023 and 2022, respectively. 

- 5 -

Operating Expenses

Operating expenses were $990,110 for the nine months ended September 30, 2023, compared to $870,683 for the same period in 2022, representing an increase of 13.7%, or $119,427. The increase was mainly due to the expenses and stock-based compensation paid to outside consultants and contractors related to the DevBlock acquisition and the Company’s Reg A filing.

Operating Loss

Total operating loss was $901,745 for the nine months ended September 30, 2023, compared to $779,205 in the same period of 2022, representing an increase of $122,540 or 16%. The increase was mainly due to increased expenses and stock-based compensation paid to outside consultants and contractors related to the DevBlock acquisition and the Company’s Reg A filing.

As of September 30, 2023, and 2022, there were no significant deferred tax assets, except for a net operating loss carryforward for which a 100% valuation allowance has been provided.

The Company annually conducts an analysis of its tax positions and has concluded that it has no uncertain tax positions as of September 30, 2023 and December 31, 2022.  The 2019 to 2022 tax years are still subject to federal audit. The 2018 to 2022 tax years are still subject to state audit.

The Company had $2,092,905 and $2,679,077 of net operating loss carryforwards available as of December 31, 2022, and 2021, respectively, for Federal and state tax purposes. The federal net operating loss carryforward does not expire while the state net operating losses expire in various years through 2041.

Net Loss

As a result of the above factors, we had a net loss of $913,584 for the nine months ended September 30, 2023, compared to a net loss of $777,911 for the same period in 2022.  

The three months ended September 30, 2023, compared to the three months ended September 30, 2022

	2023			2022
	Amount			Amount
Sales	$	33,192		$	35,099
Cost of Sales		6,160			5,229
Gross Profit		27,032			29,870
Total Other Income (Expense)		(7,082	)		858
Total Operating Expenses		238,693			247,909
Income Taxes		844			-
Net Loss	$	(219,587	)	$	(217,181	)

Revenues

Revenues were $33,192 for the three months ended September 30, 2023, a decrease of $1,907 or 5.4%, compared to $35,099 in the same period of last year. The decrease was due to lower call usage.

Gross Profit and Gross Profit Margin

Gross profit was $27,032 for the three months ended September 30, 2023, compared to $29,870 in the same period of 2022.  The decrease was due to lower call usage.  Gross margin was 81% and 85% for the three months ended September 30, 2023 and 2022, respectively. 

Operating Expenses

Operating expenses were $238,693 for the three months ended September 30, 2023, compared to $247,909 for the same period in 2022, representing a decrease of 3.7%, or $9,216. The decrease was mainly due to lower stock-based compensation paid to outside consultants and contractors between the two periods.

- 6 -

Operating Loss

Total operating loss was $211,661 for the three months ended September 30, 2023, compared to $218,039 in the same period of 2022, representing a decrease of $6,378 or 2.9%. The decrease was mainly due to lower stock-based compensation paid to outside consultants and contractors between the two periods.

Net Loss

As a result of the above factors, we had a net loss of $219,587 for the three months ended September 30, 2023, compared to a net loss of $217,181 for the same period in 2022.  

LIQUIDITY AND CAPITAL RESOURCES

Historically, our primary uses of cash have been to finance working capital needs. We expect that we will be able to meet our needs to fund operations, capital expenditures and other commitments in the next 12 months primarily with our cash balance and operating cash flows.

We may need to raise additional capital to fund our operating expenses, pay our obligations, and grow our Company in the future. Our current resources may be insufficient to satisfy all of our cash requirements and we may seek to sell additional equity or debt securities or obtain a credit facility. Our future operations may be dependent on our ability to secure additional financing. Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses, fail to collect amounts owed to us, or experience unexpected cash requirements that would force us to seek alternative financing. Furthermore, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock.

Currently, the Company has sufficient cash to remain in business for the next 12 months.

The following table sets forth a summary of our cash flows for the periods indicated.

	For the Nine Months Ended September 30,
	2023			2022
Net Cash used in Operating Activities	$	(326,703	)	$	(320,838	)
Net Cash provided by Investing Activities		-			5,886
Net Cash provided by Financing Activities		250,000			337,500
Cash at the beginning of the Period		257,512			295,937
Cash at the end of the Period	$	180,809		$	318,485

Operating Activities

Net cash used in operating activities was $326,703 for the nine months ended September 30, 2023, as compared to $320,838 used in operating activities for the nine months ended September 30, 2022, primarily due to the increased net losses incurred.

Investing Activities

There were no investing activities for the nine months ended September 30, 2023, while the Company disposed of a digital asset during the nine months ended September 30, 2022.

Financing Activities

Net cash provided by financing activities was $250,000 for the nine months ended September 30, 2023, compared to $337,500 for the nine months ended September 30, 2022 was due to the Company issuing shares for cash and entering into a one year loan agreement.

Quantitative and Qualitative Disclosures about Market Risks

Not applicable.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable because we are a smaller reporting company.

ITEM 4. CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

Our disclosure controls and procedures are designed to ensure that the information we are required to disclose in reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management to allow timely decisions regarding required disclosure.

Our management, with the participation and supervision of our Chief Executive Officer and our Chief Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of such date, our disclosure controls and procedures were not, in design and operation, effective at a reasonable assurance level due to the material weaknesses in internal control over financial reporting described as follows. Because of our limited operations, we have a limited number of employees which prohibits a segregation of duties. In addition, we lack a formal audit committee with a financial expert. As we grow and expand our operations, we will engage additional employees and experts as needed. However, there can be no assurance that our operations will expand.

Changes in Internal Controls Over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on the Effectiveness of Controls

The effectiveness of any system of internal control over financial reporting, including ours, is subject to inherent limitations, including the exercise of judgment in designing, implementing, operating, and evaluating the controls and procedures, and the inability to eliminate misconduct completely. Accordingly, in designing and evaluating the disclosure controls and procedures, management recognizes that any system of internal control over financial reporting, including ours, no matter how well designed and operated, can only provide reasonable, not absolute assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. Moreover, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. We intend to continue to monitor and upgrade our internal controls as necessary or appropriate for our business but cannot assure you that such improvements will be sufficient to provide us with effective internal control over financial reporting.

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PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

On June 29, 2021, the Company filed a complaint against Messrs. Chenyuan Anthony Chen and Ang Hu (the “Defendants”) in the Superior Court of the State of California, County of Orange (the “Complaint”). Pursuant to a Consulting Agreement dated April 1, 2019, by and among the Company and the Defendants (the “Consulting Agreement”), the Company issued to the Defendants 3,250,000 shares of the Company’s common stock (the “Consulting Shares”) as compensation for certain consulting services to be performed by the Defendants. Pursuant to the Complaint, the Company alleges that the Defendants breached the Consulting Agreement by failing to perform such consulting services and thereby seeks injunctive relief to restrain Defendants from sales of the Consulting Shares, the cancellation of the Consulting Shares, and compensatory damages and legal fees.  On July 11, 2022, the Company reached a legal settlement with the Defendants to have 3,090,000 of the Consulting Shares returned to the Company. The Consulting Shares have been cancelled as of September 29, 2022.

ITEM 1A. RISK FACTORS.

Not required for smaller reporting companies.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None. 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None. 

- 9 -

ITEM 6. EXHIBITS.

Exhibit No.	Description
31.1	Certification of Principal Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Principal Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	VEMANTI GROUP INC.
Date: November 14, 2023	By:	/s/ Tan Tran
	Name:	Tan Tran
	Title:	President, Chief Executive Officer