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

CREATIVE LEARNING CORPORATIONDriveItAway Holdings, Inc.

(fka Creative Learning Corporation)

Condensed Consolidated Statements of Operations

(Unaudited)

�� 

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

DriveItAway Holdings, Inc.

(fka Creative Learning Corporation)

Condensed Consolidated Statement of Changes in Stockholders’ Equity (Deficit)

For the Three and Nine Months Ended June 30, 2022

(Unaudited)

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

DriveItAway Holdings, Inc.

(fka Creative Learning CorporationCorporation)

Condensed Consolidated Statement of Changes in Stockholders’ Equity (Deficit)

For the Three and Nine Months Ended June 30, 2021

(Unaudited)

For the three months ended December 31, 2021 

For the three months ended December 31, 2020 

The accompanying notes are an integral part of the condensed consolidated unaudited financial statementsstatements.

DriveItAway Holdings, Inc.

CREATIVE LEARNING CORPORATION(fka Creative Learning Corporation)

Condensed Consolidated Statements of Cash Flows

(Unaudited)

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

CREATIVE LEARNING CORPORATIONDriveItAway Holdings, Inc.

(fka Creative Learning Corporation)

Notes to the Condensed Consolidated Unaudited Financial Statements

December 31, 2021June 30, 2022

(Unaudited)

(1)Note 1 - Nature of Organization and Summary of Significant Accounting Policies

Nature of Organization

Creative Learning Corporation (the “Company”DriveItAway Holdings, Inc. (“DIA Holdings”, “we” or “us”) operates wholly owned subsidiaries,was formed in Delaware on March 8, 2006 as B2 Health, Inc. On July 2, 2010, the Company acquired BFK Franchise Co., LLC (“BFK”) and SF Franchise Company, LLC (“SF”BFK”), a Nevada limited liability company, and concurrently changed its name to Creative Learning Corporation. On February 24, 2022, the Company acquired DriveItAway, Inc., and on March 18, 2022, disposed of BFK and its other subsidiaries involved in the learning business. On April 18, 2022, the name was changed to DriveItAway Holdings, Inc.

DIA Holdings is a national dealer focused mobility platform that enables car dealers to sell more vehicles in a seamless way through eCommerce, with its exclusive “Pay as You Go” app-based subscription program. DIA provides a comprehensive turnkey, solutions driven program with proprietary mobile technology and driver app, insurance coverages and training to get dealerships up and running quickly and profitably in emerging online sales opportunities. The company is planning to soon expand its easy and transparent consumer app ‘subscription to ownership’ platform to enable entry level consumers to drive and acquire new Electric Vehicles. For further information, please see www.driveitaway.com.

Share Exchange and Reorganization

On February 24, 2022 (the “Effective Date”), the Company, DriveItAway, Inc., and the existing shareholders of DriveItAway, Inc. (“DIA”) executed an Agreement and Plan of Share Exchange, under which the trade names Bricks 4 Kidz®Company acquired all of the issued and Sew Fun Studios™ respectively,outstanding common stock of DIA by issuing one share of Series A Convertible Preferred Stock (the “Series A Preferred”) of the Company for each outstanding share of DIA common stock (the “Share Exchange”). At the closing, the Company agreed to issue one share of Series A Preferred for each share of DIA common stock that offer children’s enrichment and education franchises. Aswas subsequently issued in conversion of certain outstanding convertible notes of DIA, provided that the holders converted their notes prior to December 31, 2021, BFK had 274 global Bricks 4 Kidz®2022. All of the holders of the convertible notes of DIA agreed to convert their notes in March 2022 and Sew Fun Studios® franchise territories, 28 Bricks 4 Kidz® master franchises,were issued one share of Series A Preferred in exchange for the DIA common stock they acquired as a result of the conversion. A total of 2,594,593 shares of Series A Preferred were issued in exchange for all of the outstanding shares of DIA, including DIA shares issued at closing or shortly thereafter as a result of the exercise or conversion of all outstanding options or convertible notes issued by DIA.

Recapitalization

For financial accounting purposes, this transaction was treated as a reverse acquisition by DIA and 134 Bricks 4 Kidz® sub-franchises operatingresulted in 39 countries.

a recapitalization with DIA being the accounting acquirer and DIA, Inc. as the acquired company. The consummation of this reverse acquisition resulted in a change of control. Accordingly, the historical financial statements prior to the acquisition are those of the accounting acquirer, DIA and have been prepared to give retroactive effect to the reverse acquisition completed on February 24, 2022, and represent the operations of DIA. The consolidated financial statements after the acquisition date, February 24, 2022, include the balance sheets of both companies at fair value, the historical results of DIA and the results of the Company from the acquisition date. All share and per share information in the accompanying consolidated financial statements and footnotes has been retroactively restated to reflect the recapitalization.

Basis of Presentation

The Company prepares its financial statements in accordance with rules and regulations of the Securities and Exchange Commission (“SEC”) and Generally Accepted Accounting Principles (“GAAP”) in the United States of America. The accompanying unaudited consolidatedinterim financial statements have been prepared in accordance with accounting principles generally accepted in the United StatesGAAP for interim financial information in accordance with the instructions to Form 10-Q and with Rule 10-01Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the Company’s opinion, all adjustments (consisting of management, these consolidated financial statements contain all normal recurring adjustmentsaccruals) considered necessary for a fair presentation of the Company’shave been included. Operating results for the interim periods that have been included. The results for the threenine months ended December 31, 2021June 30, 2022, are not necessarily indicative of the results to be expected for the full year. TheseWhile management of the Company believes that the disclosures presented herein are adequate and not misleading, these interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements and management’s discussion and analysis included in the Company’s annual report on Form 10-Kfootnotes thereto for the year ended September 30, 2021.2021, contained in the Company’s Form 8-K/A, exhibit 99.1, as filed on February 24, 2022.

Related PartiesBasis of Consolidation

The consolidated financial statements include the accounts of DriveItAway Holdings Inc. and its wholly owned subsidiary DriveItAway, Inc., collectively referred to as the “Company”. All inter-company balances and transactions are eliminated in consolidation.

Fiscal year

The Company has been involved in transactions with related parties. A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if 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. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is alsooperates on a related party.September 30 fiscal year-end.

Use of Estimates

The preparation of financial statements in accordance with generally accepted accounting principlesGAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenues and expenses during the reporting period. The more significant estimates and assumptions made by management include allowance for doubtful accounts, the valuation allowance for deferred tax assets, depreciation of property and equipment, amortization of intangible assets, recoverability of long-lived assets and fair market value of equity instruments. Actual results could differ from those estimates as the current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions.

Cash Restricted Cash and Cash Equivalents

The Company had restrictedconsiders all highly liquid securities with original maturities of three months or less when acquired, to be cash equivalents. As of approximately $3,000 and $5,000 at December 31, 2021June 30, 2022 and September 30, 2021 respectively, associated with marketing funds collected from the franchisees. Per the franchise agreements a marketing fund of 2% of franchisees gross cash receipts is collected and held to be spent on the promotion of the brand. Any cash collected by the Company for marketing funds is held in a separate bank accounthad cash of $389,664 and any balance at period end is presented as “restricted cash”$9,774, respectively and “accrued marketing fund” or “marketing fund receivable” on the balance sheet.did not have cash equivalents.

Accounts and Note ReceivablesReceivable

The Company reviews accounts and notes receivable periodically for collectability and establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary. The Company records an allowance for doubtful accounts and notes that is based on historical trends, customer knowledge, any known disputes, and considers the aging of the accounts receivable balances combined with management’s estimate of future potential recoverability. ReceivablesAccounts and notesreceivables are written off against the allowance after all attempts to collect a receivable have failed. The Company believes its allowanceallowances for doubtful accounts at December 31, 2021as of June 30, 2022 and September 30, 2021 are adequate, but actual write-offs could exceed the recorded allowance.

Property, Equipment As of June 30, 2022 and Depreciation

Property and equipment are stated at cost. Depreciation is calculated usingSeptember 30, 2021 the straight-line method over the estimated useful lives of the related assets, which range from three to forty years. Expenditures for additions and improvements are capitalized, while repairs and maintenance costs are expensed as incurred. The cost and related accumulated depreciation of property and equipment sold or otherwise disposed of are removed from the accounts and any gain or loss is recordedbalances in the year of disposal.

Long-Lived Assets

The Company’s long-lived assets consist of property and equipment, and intangible assets. The Company testsallowance for impairment losses on long-lived assets used in operations whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.  Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value.  Impairment evaluations involve management’s estimates of asset useful lives and future cash flows.  Actual useful lives and cash flows could be different from those estimated by management which could have a material effect on our reporting results and financial positions.  Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary.doubtful accounts was $0.

Accounting for Operating LeasesProperty and Equipment

The Company’s operating leases consistProperty and equipment, consisting of a twenty-five month lease (commencing November 1, 2021 through November 1, 2023) for office spacevehicle are stated at 1637 S. Main Street, Milpitas, CA 94035. In accordance with ASC 842 – Leases,cost. Depreciation expense is recognized over the Company has recorded a Right-of-Use Assetassets’ estimated useful lives of five years using the straight-line method. Major additions and Lease Liability of $104,756 at the lease commencement, based on the discounted minimum rent payments under the office lease. The discount rate used was equalimprovements are capitalized as additions to the Company’s cost of capital (6%). The Company is obligated to pay base rent of $4,588 per month in the first year, $4,726 per month in the second year,property and $4,867 per month in the last month, plus a pro rata share of common area expenses. The Right-of-Use Asset is being recognized over its useful life. Rental expense related to the lease during the three months ended December 30, 2021 was $12,571.

Intangible Asset

The Company records intangible assets at costequipment accounts, while replacements, maintenance and then amortizes the intangible asset over its useful life. Costs incurred to renewrepairs that do not improve or extend the termlife of any intangiblethe respective assets, will beare expensed as incurred. DuringEstimated useful lives are periodically reviewed and, when appropriate, changes are made prospectively. When certain events or changes in operating conditions occur, asset lives may be adjusted and an impairment assessment may be performed on the year ended September 30, 2021recoverability of the Company acquired intellectual property consisting of software and content for $168,000carrying amounts.. The intangible asset is being amortized over its useful life of 5 years and the Company recognized $8,400 worth of amortization expense during the three months ended December 31, 2021, which resulted in an intangible asset balance of $154,000 as of December 31, 2021. Amortization expense of $33,600 is expected annually through September 30, 2025 with amortization expense of $28,000 expected for the year ended September 30, 2026.

Fair Value of Financial Instruments

The carrying amounts of cash, accounts receivable, and accounts payable approximate fair value because of the relative short-term maturity of these items and current payment expected. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment, and therefore cannot be determined with precision. Changes in assumptions could significantly affect these estimates. The Company does not hold or issue financial instruments for trading purposes, nor does it utilize derivative instruments. Notes receivable are recorded at par value less allowance for doubtful accounts. The carrying amount is consistent with fair value based upon similar notes issued to other franchisees.

ASC 825, Financial Instruments, clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. It also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows:

The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

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

Revenue Recognition

The Company’s revenue is recognized in accordance with Accounting Standards Codification(“ASC”) 606, Revenue from Contracts with Customers, for all periods presented. The Company, through its DriveItAway online/app-based platform, operates in the retail automotive industry. The Company assists subprime and deep subprime candidates, with little or no down payment, in purchasing the used vehicle of his/her choice by first starting in an app based, turnkey rental, through participating franchise and independent car dealers. During the period ended June 30, 2022 and 2021, the Company derived its rental revenue from contract revenue share for rentals between participating franchise and independent car dealers and individual car rental customers (“customers”). In conjunction with the rental revenue, the Company generates almost all of its revenue from contractsby providing driver and vehicle insurance through a third party, included in the rental contract with customers. The Company’s franchise agreements enter the parties into a contractual agreement, typically over a ten years term, and include performance obligations as follows: protected territory designation, access to proprietary manuals and handbooks, initial training and on-going assistance, consulting, promotion of goodwill, administration of marketing fund, marketing and promotion items, initial marketing program development assistance, company website access, Franchise Management Tool access, lessons and model plans, project kits, Duplo bricks, frames stop motion animation software, and use of the franchisor’s intellectual property (IP) (e.g., trade name – Bricks for Kidz). Upon entering into a franchise agreement, the Company charges an initial franchise fee, which is fully collectible and nonrefundable as of the date of the signing of the franchise agreement. Further, because the Company’s franchises are primarily a mobile concept and do not require finding locations or construction, the franchisees can begin operations as soon as they complete training.each customer.

PerThe Company’s performance obligation for rental revenue is to provide an application to track car rental arrangements and to collect cash from car rental customers and remit those payments to participating franchise and independent car dealers, net of the Company’s revenue share. The car rental arrangements are over a fixed contracted period; therefore, the Company recognizes revenue ratably during the contract term. The Company’s performance obligation for insurance revenue is to collect insurance fees from the customer and provide the third-party provider payment for the insurance provided to the customer. The insurance is offered over a fixed contracted period; therefore, the Company recognizes revenue ratably during the contract term.

Rental and insurance transactions are prepaid at the beginning of the rental cycle (typically a one-week rental that has an automatic renewal) with an automatic charge to the customer’s credit card on file through the DIA system. The DIA system then distributes the vehicle owner share (typically 85% of rental revenue) to the vehicle owner’s bank account from the Stripe Account. This amount is shown as a deduction to Revenues (“Vehicle Owner Share”) on the Company’s Statements of Operations. The net amount is then transferred from the Company’s Stripe Account to the DIA operating bank account. DIA also distributes insurance amounts due to the third^-party insurance provider on a monthly basis. This amount is shown as a deduction to revenues (“Driver & Dealer Insurance Cost”) on the Company’s Statements of Operations.

DIA also generates miscellaneous revenue in a number of ways. At the end of the rental term, the DIA software system checks for any excess usage and charges, based on the terms of the franchise agreements,rental contract, and will automatically charge a customer’s credit card. These charges are recognized when the credit card charge goes through and recorded as miscellaneous revenue on the Company’s Statements of Operations. Additional miscellaneous revenue represents amounts earned on telematics equipment and telematics software services related to each rental vehicle used to track excess usage and charges. DIA performance obligation is to provide the equipment to the vehicle owner for self-installation and allow access to the software throughout the rental term. The Company charges for royalty feesrecognizes revenue when the equipment is delivered to the vehicle owner. Miscellaneous revenue associated with use of the telematics software is recognized on a monthly basis, generally set at a fixed amount, but in some cases are based on a percentage of franchisee’s monthly gross revenues. The Company also charges fees for a marketing fund, generally based on 2% of franchisee’s monthly gross revenues, which is managed by the Company, to allocate towards national branding of the Company’s concepts to benefit the franchisees. Lastly, the Company charges for technology fees on a monthly basis, generally at a fixed amount, for the use of the company Franchise Management tool as well as company emails, etc.basis.

Effective October 1, 2018The Company’s Cost of Goods sold consists of credit card fees incurred from the Company began recognizing revenue under ASC 606. cash collections and cash remittance process, as a significant portion of its performance obligation is to collect and remit payments through its credit card processors.

Stock-Based Compensation

The Company considers initial franchise feesrecognizes compensation expense for all restricted stock awards and stock options. The fair value of restricted stock awards is measured using the grant date fair value of our stock, as determined by the Board of Directors. The fair value of stock options is estimated at the grant date using the Black-Scholes option-pricing model, and the portion that is ultimately expected to be a part ofvest is recognized as compensation cost over the license of symbolic intellectual property (“IP”), therefore the performance obligation relatedrequisite service period. We have elected to these fees is satisfied over time as the Company fulfills its promise to grant the customer rights to use, and benefit from, the Company’s IP, as well as support and maintain the IP. The initial franchise fee, then, is recorded as deferred revenue at inception and recognizedrecognize compensation expense for all options with graded vesting on a straight-line basis over the contract term.

In accordance with ASC 606-10-55-65, the Company has determined that the royalty fees, marketing fees, and technology fees are subject to a sales and usage-based royalties’ constraint on licenses of IP. Accordingly, these fees are recognized as revenue at the later of when the sales or usage occurs or the related performance obligation is satisfied. Technology fees are recorded net of processing fees. Marketing fees are limited to the lesser of marketing amounts earned or expensed; therefore, the Company will recognize amounts received in excess of amounts spent on the balance sheet in the accrued marketing fund liability and will recognize amounts spent in excess of amounts received on the balance sheet in the marketing fund receivable.

The Company collects transfer fees when contracts are transferred between parties and accounts for the transfer as a contract modification under ASC 606. Because the transfer does not increase the scopevesting period of the contract or promise any additional goods or servicesentire option. The determination of fair value using the Black-Scholes pricing model is affected by our stock value as well as assumptions regarding a number of complex and there are no new distinct services that will be provided after the transfer the Company considers the transfer fee part of the existing contract. Transfer fees, then, are recorded as deferred revenue at inception and recognized on a straight-line basis over the remaining contract term.

When contracts are terminated due to default, or in conjunction with an early termination agreement, the Company accounts for the early termination as a contract modification under ASC 606. Because the termination eliminates any future performance obligations of the Company any deferred revenue associated with the terminated contract is recognized into revenue at the time of termination, along with any early termination fees, in the initial franchise fee line on the Company’s Statement of Operations.

The Company generates revenue from sales of merchandise where the performance obligation is met, and therefore revenue recognized, upon the delivery of merchandise to the customer.

Contract Liability – Deferred Revenue

In conjunction with the adoption of ASC 606, effective October 1, 2018 the Company recorded deferred revenue as a contract liability for its initial franchise fees collected and related to contracts with remaining performance obligations. During the three months ended December 31, 2021 the activity in the deferred revenue account was as follows:

Amountssubjective variables, including expected to be recognized into revenue related to performance obligations that are unsatisfied (or partially unsatisfied) as of December 31, 2021 were as follows:

Contract Liability / Asset – Accrued Marketing Fund / Marketing Fund Receivable

Per the terms of the franchise agreements, the Company collects 2% of franchisee’s gross revenues for a marketing fund, managed by the Company, to allocate toward national branding of the Company’s concepts to benefit the franchisees.

The marketing fund amounts owed to the Company are accounted for as a liability on the balance sheetstock price volatility and the actual collections are deposited into a marketing fund bank account, presented as restricted cash on the balance sheet. Expenses pertaining to the marketing fund activities are paid from the marketing fund and reduce the liability account. Upon adoption of FASB 606 on October 1, 2018, the Company presents these marketing fund revenues and expenses on a gross basis on its statement of operations. Any unused funds at the end of the period are recorded as accrued marketing fees or any funds used in excess of funds collected are recorded as a marketing fund receivable. The Company expects to collect this advance in future periods from the 2% fees collected on future franchisee gross revenues. The activity in the accrued marketing fund liability account for the three months ended December 31, 2021 was as follows:

Contract Asset – Prepaid Commission Expense

In accordance with ASC 606 the costs related to obtaining a contract are to be capitalized as long as the costs are recoverable and incremental. Effective October 1, 2018, the date the Company adopted ASC 606, it capitalized the value of sales commissions as a contract asset and is amortizing those costs straight-line over the contract life of the franchise agreement to which they relate. During the three months ended December 31, 2021, the activity in the contract asset account was as follows:

General Advertising Costs

General advertising costs are expensed as incurred. The Company incurred general advertising costs for the three months ended December 31, 2021 and 2020 of $28,544 and $1,724, respectively.risk-free interest rate.

Income Taxes

The provision for income taxes and deferred income taxes are determined using the asset and liability method. Deferred tax assets and liabilities are determined based on temporary differences between the financial carrying amounts and the tax basis of assets and liabilities using enacted tax rates in effect in the years in which the temporary differences are expected to reverse. On a periodic basis, the Company assesses the probability that its net deferred tax assets, if any, will be recovered. If after evaluating all of the positive and negative evidence, a conclusion is made that it is more likely than not that some portion or all of the net deferred tax assets will not be recovered, a valuation allowance is provided by a charge to tax expense to reserve the portion of the deferred tax assets which are not expected to be realized. Given previous recurring losses, the Company cannot conclude that it is more likely than not that such assets will be realized, therefore a full valuation allowance has been recorded during the three months ended December 31, 2021.

The Company reviews its filing positions for all open tax years in all U.S. federal and state jurisdictions where the Company is required to file.

When there are uncertainties related to potential income tax benefits, in order to qualify for recognition, the position the Company takes has to have at least a “more likely than not” chance of being sustained (based on the position’s technical merits) upon challenge by the respective authorities. The term “more likely than not” means a likelihood of more than 50 percent. Otherwise, the Company may not recognize any of the potential tax benefit associated with the position. The Company recognizes a benefit for a tax position that meets the “more likely than not” criterion at the largest amount of tax benefit that is greater than 50 percent likely of being realized upon its effective resolution. Unrecognized tax benefits involve management’s judgment regarding the likelihood of the benefit being sustained with the ultimate realization being dependent on generating sufficient taxable income in future years. The final resolution of uncertain tax positions could result in adjustments to recorded amounts and may affect our results of operations, financial position and cash flows.

The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had no accrual for interest or penalties at December 31, 2021 and September 30, 2021 and has not recognized interest and/or penalties during the three months ended December 31, 2021, since there are no material unrecognized tax benefits. Management believes no material change to the amount of unrecognized tax benefits will occur within the next twelve months.

The tax years subject to examination by major tax jurisdictions include the years 2015 and forward by the U.S. Internal Revenue Service.

Net earnings (loss)Loss per shareShare of Common Stock

Basic earningsThe Company calculates net loss per share arein accordance with ASC Topic 260, “Earnings per Share.” Basic loss per share is computed by dividing the net income (loss)loss by the weighted average number of common shares outstanding forduring the period. Diluted earnings (loss) per share reflect the potential dilution that could occur if stock options or other contracts to issueof common stock were exercised or convertedare computed by dividing net earnings by the weighted average number of shares and potential shares outstanding during the period. Dilutive securities having an anti-dilutive effect on diluted earnings per share arePotential shares of common stock consist of shares issuable upon the conversion of outstanding convertible debt, preferred stock, warrants and stock option. For the periods ended June 30, 2022 and 2021, the common stock equivalents were excluded from the calculation.computation of diluted net loss per share as the result of the computation was anti-dilutive.

For the nine months ended June 30, 2022, and 2021, respectively, the following common stock equivalents were excluded from the computation of diluted net loss per share as the result was anti-dilutive.

Reclassification

Certain accounts from prior periods have been reclassified to conform to the current period presentation.

Stock-based compensationRecent Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, ASC Subtopic 470-20 “Debt—Debt with “Conversion and Other Options” and ASC subtopic 815-40 “Hedging—Contracts in Entity’s Own Equity”. The standard reduced the number of accounting models for convertible debt instruments and convertible preferred stock. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting; and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. The amendments in this update are effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. On October 1, 2021, the Company adopted this standard on its consolidated financial statements.

The Company has considered all other recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its consolidated financial statements.

Note 2 – Going Concern

During the nine months ended June 30, 2022, the Company had a net loss of $1,735,166 and did not have sufficient cash on hand to cover expenses for the next twelve (12) months. The reported net cash used in operating activities was $616,515 during the nine months ended June 30, 2022, which was offset by an increase in cash of $1,052,450 during the period ended June 30, 2022 from financings and $70,361 from the acquisition of a subsidiary. These factors, among others, raise substantial doubt about the entities ability to continue as a going concern.

Management plans include converting its convertible debt into the Company’s common stock in addition to raising equity capital.

The financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

Note 3 – Related Party Transactions

Related Party Convertible Notes Payable

On September 13, 2019, the Company issued a Convertible Promissory Note to Driveitaway, LLC, a company controlled by John Possumato, the Company’s CEO, for $30,000, with a maturity date of September 13, 2022. On October 13 and October 14, 2020, the Company issued Convertible Promissory Notes to Driveitaway, LLC and Adam Potash, the Company’s COO, for $25,000 each, which mature on October 13 and 14, 2022, respectively. On December 24, 2020, the Company issued a Convertible Promissory Note to Adam Potash, for $15,000, which matures on December 24, 2022. Each of the notes bear interest at a rate of 6% per annum. The notes automatically convert into preferred stock of DIA in the event DIA raises at least $1,000,000 by the issuance of preferred stock prior to the maturity dates of the notes (a “Qualified Financing”). In the event DIA enters into a financing that is not a Qualified Financing prior to the maturity dates of the notes, the holders have the right to convert their notes into the class and series of equity securities offered in the non-Qualified Financing at the offer price thereof. In the event DIA effects a change of control, the holders have the option of converting their notes into common stock in order to participate in the change of control or accelerating the maturity date and receiving cash at the time of the change of control.

During the nine months ended June 30, 2022 and 2021, the Company recorded interest expense of $2,296 and $3,943, respectively.

At the closing of the Share Exchange on February 24, 2022, the holders of the related party Convertible Promissory Notes agreed to convert all of the principal and interest of $104,564 due under the notes into 52,284 shares of DIA common stock, which was automatically converted into 52,284 shares of Series A Preferred (see Note 7).

Note 4 – Goodwill

The following table summarizes the consideration paid for DriveItAway Holdings, Inc and the amounts of the assets acquired, and liabilities assumed at the acquisition date of February 24, 2022:

Note 5 - Note Receivable

A note receivable of $100,000 was issued to DriveItAway Holdings in consideration for the sale of certain subsidiaries as a part of its recapitalization. The note receivable was unsecured, due on April 20, 2022 and was to incur interest at 15% per annum, provided that the payor has the right to satisfy the note in full by the return of 500,000 shares of the Company’s common stock for cancellation. In May 2022, the payor under the note receivable satisfied the note in full by returning 500,000 shares of the Company’s common stock for cancellation (see Note 7).

Note 6 – Vehicles

During the nine months ended June 30, 2022, the Company purchased 3 vehicles for $126,406 and recorded depreciation of $4,645.

Note 7 – Equity

Authorized

On April 18, 2022, the Company filed Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to authorize one billion (1,000,000,000) shares of common stock having a par value of $0.0001 per share, and ten million (10,000,000) shares of preferred stock having a par value of $0.0001 per share. All or any part of the capital stock may be issued by the Corporation from time to time and for such consideration and on such terms as may be determined and fixed by the Board of Directors, without action of the stockholders, as provided by law, unless the Board of Directors deems it advisable to obtain the advice of the stockholders.

Series A Preferred Stock

The Company accounts for employeehas authorized one series of preferred stock, awards for services basedwhich is known as the Series A Convertible Preferred Stock (the “Series A Preferred”). The Board has authorized the issuance of 5,000,000 shares of Series A Preferred. The Series A Preferred Stock has the following rights and preferences:

Dividends: The Series A Preferred Stock is entitled to receive non-cumulative dividends equal to the amount of dividends that the holder of such share would have received if such share of Series A Preferred Stock were converted into shares of Common Stock immediately prior to the record date of the dividend declared on the grant date fair valueCommon Stock.

Liquidation Preference: The Series A Preferred Stock is entitled to receive, prior to any distribution to any junior class of securities, an amount equal to $0.01 per share as a liquidation preference before any distribution may be made to the holders of any junior security, including the Common Stock.

Voting Rights: Each holder of Series A Preferred Stock shall vote with holders of the instrument issued, and those issuedCommon Stock upon any matter submitted to non-employees are recorded baseda vote of shareholders, in which event it shall have the number of votes equal to the number of shares of Common Stock into which such share of Series A Preferred Stock would be convertible on the grantrecord date fair valuefor the vote or consent of shareholders. Each holder of Series A Preferred Stock shall also be entitled to one vote per share on each submitted to a class vote of the consideration received orholders of Series A Preferred Stock.

Voluntary Conversion Rights: Each share of Series A Preferred Stock is convertible into 33.94971 shares of Common Stock at the fair valueoption of the equity instrument, whichever is more reliably measurable.holder thereof.

Mandatory Conversion Right: The Company has the right to convert each share of Series A Preferred Stock awardsinto 33.94971 shares of Common Stock at any time that there are expensed over the service period.less than 200,000 shares of Series A Preferred Stock outstanding.

During the threenine months ended December 31,June 30, 2021, the Company issued 20,000300,000 shares for stock-based compensationof DIA common stock which was automatically converted into 300,000 shares of Series A Preferred at the closing of the Share Exchange on February 24, 2022. The shares were issued to a consulting firm pursuant to one year consulting agreement and valued at $3,200692,308. Stock-based compensation expense related to this issuance for the nine months ended June 30, 2022 and 2021 was $288,461 and $230,770, based onrespectively, and was included in general and administrative expense.

During the market valuenine months ended June 30, 2022, the Company issued 294,593 shares of DIA common stock which was automatically converted into 294,593 shares of Series A Preferred at the closing of the Company sharesShare Exchange on the grant date, andFebruary 24, 2022. The preferred stock is reflected retroactively for all periods presented.

On April 20, 2022, holders of 155,1032,464,784 shares uponof Series A Preferred agreed to convert their Series A Preferred into common stock, which resulted in the cashlessissuance of 83,678,702 shares of common stock. On the same date, the board of directors approved a resolution to exercise the Company’s right to mandatorily convert the remaining 129,809 shares of Series A Preferred into common stock, which resulted in the issuance of an additional 294,7784,406,979 stock options.shares of common stock.

Reclassifications

Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported resultsAs of operations.

Recent accounting pronouncements

All newly issued accounting pronouncements, but not yet effective, have been deemed either immaterial or not applicable.

(2) Notes and Other Receivables

At December 31, 2021June 30, 2022 and September 30, 2021, the Company held certain notes receivable totaling approximately $had 6,0000 and $6,0002,300,000, respectively, net shares of allowances, for extended payment terms of franchise fees. The notes receivable bear interest of 4% per annum with monthly payments, payable within four years. The Company analyzes the collectability of all receivables and reserves accordingly.

(3) Commitments and ContingenciesSeries A Preferred stock outstanding, respectively.

LitigationCommon Stock Issuances

The Company is subject to litigation claims arising in the ordinary course of business. The Company believes that it has adequately accrued for legal matters in accordance with the requirements of GAAP. The Company records litigation accruals for legal matters which are both probable and estimable and for related legal costs as incurred. The Company does not reduce these liabilities for potential insurance or third-party recoveries.

On February 24, 2017, franchisee, Team Kasa, LLC, along with its three owners, filed suit2022, the Company recognized the equity of DIA Holdings as part of the reorganization which resulted in the Eastern DistrictCompany recognizing the issuance of New York (Case No. 2:17-cv-01074) against former CEO Brian Pappas13,716,041 shares of common stock and Franventures, as well as four other defendants seeking damages under the New York Franchise Sales Act. The same Plaintiffs also initiated an arbitration proceeding against15,100 shares of treasury stock, at a value of $1,720,867 (see Note 4).

On February 24, 2022, the Company onissued 4,000,000 shares of common stock valued at $316,324 for commitment fees in conjunction with the same issues (American Arbitration Association, Case No. 01-17-0001-1968), allegingissuance of promissory note of $750,000 (see Note 9).

On April 20, 2022, the Company is jointly and severally liableissued 88,085,681 shares of common stock as a result of the conversion of all outstanding shares of Series A Preferred Stock.

In May 2022, 500,000 shares were returned for damages resulting from the allegations against Mr. Pappas and Franventures. The Company is contesting the allegations and its liability for any damagescancellation, to satisfy a note receivable in the arbitration case. Both cases have been held in abeyance asamount of $100,000 (see Note 5).

As of June 30, 2022 and September 30, 2021, the parties seek a resolution.Company had 105,301,722 and 0 common shares issued, respectively.

LeaseTreasury stock

The Company records treasury stock at cost. Treasury stock is comprised of shares of common stock purchased by the Company in the secondary market. As of June 30, 2022 and September 30, 2021, the Company had 15,100 and 0 shares of treasury stock, respectively.

Stock Options

On October 21, 2021,June 12, 2020, DIA’s Board of Directors and its shareholders approved its 2020 Equity Compensation Plan (“Equity Plan”). The Equity Plan permits DIA to issue awards or options to the employees, directors, consultants and advisors who provide services to the Company leased approximately 2,480 square feet of office space at 1637 S. Main Street, Milpitas, CA 94035 for its corporate offices. The lease hasor a term of two years and one month. The Company is obligated to pay base rent of $4,588 per month in the first year, $4,726 per month in the second year, and $4,867 per month in the last month, plus a pro rata share of common area expenses. On November 1, 2021, the Company relocated its corporate officessubsidiary. Pursuant to the Milpitas, California location.Equity Plan, 400,000 shares of DIA’s common stock were reserved for issuance. The Equity Plan allows DIA’s board or a committee of the board to issue grants of incentive stock options, nonqualified stock options, stock awards, stock units, stock appreciation rights and other equity-based awards.

(4) Related Party Transactions

Christopher Rego has been a director since February 5, 2020, and our Chief Executive Officer since May 1, 2020. Prior to his appointment, Mr. Rego purchased an active franchise in California. During the three months ended December 31, 2021 the Company recognized royalty revenue from the franchise of $1,688 and recognized marketing fee revenue from the franchise of $0. Total payments made by the franchisee were $1,125As of December 31, 2021, DIA had 300,000 stock options outstanding under the Equity Plan to Messrs. Possumato, CEO, and September 30, 2021 the accounts receivable balance with the franchisee was $Potash, COO in equal amounts, of which 1,210112,500 and $1,897, respectively and the franchisee had deferred revenue balances of $0.

John Simento has been a director of the Company since May 19, 2020. Prior to Mr. Rego’s and Mr. Simento’s appointments with the Company, they purchased a Company franchise in the United Arab Emirates (the “UAE”). The Company filed an arbitration complaint against them in December 2019 regarding issues related to opening the franchise. The complaint was resolved by a Settlement Agreement dated February 5, 2020. Under the Settlement Agreement, the Company forgave all back royalty fees through July 2019, equaling $18,825, and agreed to defer all other fees until the franchise was able to obtain a business license to operate in the UAE., which is currently delayed due to the Coronavirus pandemic. The franchise is currently non-operationalvested as a result of an inability to obtain the issuance of a business license from the UAE due to the Coronavirus pandemic. If the franchise is not able to procure the necessary authorizations to operate, the franchisees would not owe any franchise fees. As a consequence, we have not realized any revenue from the franchise and no payments have been received on outstanding balances. As of December 31, 2021 and September 30, 20212021. At the accounts receivable balance with the franchise was $10,613 and the Company had allowed for $10,613, for net AR balances of $0.

Mr. Rego is also the CEO of Teknowland, a software development company, with which the Company entered into an agreement on March 10, 2020 to perform development and maintenance services in relation to the Company’s franchise management software. The term of the agreement was six months, subject to auto-renewal until Teknowland had completed its obligations under the agreement, but subject to each party’s right to terminate the agreement at any time on 30 days’ notice. Under the agreement, the Company was obligated to pay Teknowland a fee of $12,900 per month for development and maintenance services. Starting in November 2020, the Company and Teknowland orally agreed to reduce the monthly amount that the Company was obligated to pay to $3,000per month.

During the year ended September 30, 2020, the Company and Mr. Rego orally agreed that Mr. Rego and Teknowland would develop an eLearning program to enable the Company to offer educational programs over the internet. No agreement was reached regarding whether the Company or Teknowland would own the eLearning program, or the terms under which the Company would be entitled to use the program on a long-term basis, whether as owner or licensee. The Company orally agreed to pay Teknowland $10,000 per month for five months for hosting and content costs incurred by Teknowland. After testing the program, the Company’s board decided in December 2020 not to pursue the E-Learning program.

Beginning in January 2021, Teknowland began hosting the Company’s website at a cost of $5,000 per month pursuant to an oral agreement.

On February 12, 2021, the Company, Chris Rego and Teknowland entered into an agreement under which the parties mutually agreed to terminate the March 10, 2020 agreement to develop and maintain the Company’s franchise management system, and the oral agreement under which Teknowland hosted the Company’s website. In both cases, the Company has engaged an independent firm to provide the services. Under the same agreement, the Company agreed to transfer and assign to Teknowland all of the Company’s rights in the E-Learning program developed by Teknowland for the Company. The Company evaluated the E-Learning program on a trial basis, and elected not to pursue it as a line of business. The Company agreed to pay Teknowland $50,000 to pay all invoices associated with the two agreements and the E-Learning program, of which $20,000 was payable at execution of the agreement, $20,000 was payable 30 days later and $10,000 was payable 60 days later. As of September 30, 2021 the entire amount had been paid.

On December 7, 2021, the Company entered into a Sale Agreement with StroomX, LLC (the “Purchaser”), under which the Company agreed to sell all of the Company’s subsidiaries (the “Learning Subsidiaries”) involved in its learning business (the “Learning Business”), as well as any assets of the Learning Business that are not owned by the Learning Subsidiaries, to the Purchaser. In connection with the sale, the Purchaser agreed to pay the Company in cash or stock of the Company at the Purchaser’s election, assume all liabilities of the Learning Business, and to indemnify and hold the Company harmless from any such liabilities. The Purchaser is controlled by Christopher Rego. As of the date of this filing the closing of the sale had not yet occurred.

(5) Acquisition of Assets

On December 7, 2021, the Company, DriveItAway, Inc., a Delaware corporation (“DIA”), and the existing shareholders of DIA executed an Agreement and Plan of Share Exchange (the “Share Exchange Agreement”), under which the Company would acquire all of the issued and outstanding common stock of DIA by issuing one share of Series A Convertible Preferred Stock (the “Series A Preferred”) of the Company for each outstanding share of DIA common stock (the “Share Exchange”). As a result of the Share Exchange, DIA will become a wholly-owned subsidiary of the Company. Each share of Series A Preferred will be convertible into that number of shares of common stock of the Company which would entitle the Series A Preferred holders to 85% of the Company’s common stock, determined on a fully-diluted basis, but prior to any shares issued or issuable as a result of the Financing (as defined below). The exact conversion rate of the Series A Preferred will be determined at closing of the Share Exchange. In addition, each share of Series A Preferred will be entitled to dividends and voting rights on an “as converted” basis with the common stockholders. Upon closing of the Share Exchange, allMessrs. Possumato and Potash each agreed to exercise the 56,250 vested stock options issued to them, which was the number of stock options which had vested as of the existing membersdate the Share Exchange Agreement was executed. The options were converted into 112,500 shares of DIA common stock, which was automatically converted into 112,500 shares of Series A Preferred. The balance of the boardstock options issued to Messrs. Possumato and Potash were cancelled. The stock options had an exercise price of directors (the “Board”)$0.75 per share. In lieu of paying the Company have agreedexercise price in cash, the exercise price was recorded as compensation expense of $42,188 to resign,each of Messrs. Possumato and John Possumato, Adam Potash and Paul Patrizio will be appointed toPotash.

Also, at the Company’s Board. Upon closing of the Share Exchange, Christopher RegoDIA’s board cancelled the Equity Plan and Rod Whiton have agreed to resignall outstanding options were cancelled. Accordingly, as officers, and upon their resignation John Possumato will be appointed chief executive officer and Adam Potash will be appointed chief operating officer. Mike Elkin has agreed to remain as chief financial officer of June 30, 2022 the Company. Closing of the Share Exchange Agreement is subject to a number of conditions, and is expected to occur during 2022, provided that the closing conditions are satisfied or waived.

DIA is the first national dealer focused mobility platform that enables car dealers to sell more vehicles in a seamless way through eCommerce, with its exclusive “Pay as You Go” app-based subscription program. DIA provides a comprehensive turn-key, solutions driven program with proprietary mobile technology and driver app, insurance coverages and training to get dealerships up and running quickly and profitably in emerging online sales opportunities. The company is planning to soon to expand its easy and transparent consumer app ’subscription to ownership’ platform to enable entry level consumers to drive and acquire new electric vehicles.Company had no options outstanding.

(6) Warrants

On February 24, 2022, in conjunction with the issuance of a promissory note of $Subsequent Events750,000, the Company issued 1,000,000 warrants for $0.30 per share, which were assigned a value of $28,372, and recorded to additional paid in capital. The warrants expire on February 24, 2027.

In June 2022, in conjunction with a private offering and the issuance of secured promissory notes of $250,000 (see Note 9), the Company issued 125,000 warrants for $0.30 per share, which were assigned a value of $7,912, and recorded to additional paid in capital. The warrants expire in June 2027.

The warrants were valued using the Black-Scholes pricing model. The Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement.

For the nine months ended June 30, 2022, the estimated fair values of the warrants were measured using the following inputs:

A summary of activity during the nine months ended June 30, 2022 is as follows:

1,882,793 warrants outstanding in the Company prior to February 24, 2022, reflect the warrants as assumed in the reorganization.

The intrinsic value of the warrants as of June 30, 2022, is $0. All of the outstanding warrants are exercisable as of June 30, 2022.

Note 8 – Notes Payable

PPP Loan

On April 28, 2020, the Company was granted a loan (the “Loan”) from First Bank of the Lake in aggregate amount of $119,98023,750, pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act, which was enacted March 27, 2020. The Loan, which was in the form of a Note dated April 24,May 9, 2020 issued by the Company, matures on April 23,May 8, 2022 and bears interest at a rate of 1%1% per annum, payable monthly commencing on October 23, 2020. The Note may be prepaid by the Borrower at any time prior to maturity with no prepayment penalties. Funds from the Loan may only be used for payroll costs, cost used to continue group health care benefits, mortgage payments, rent, utilities and interest on other debt obligations incurred before February 15, 2020. The Company used the entire Loan amount for qualifying expenses. Under the terms of the PPP, certain amounts of the Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act. The Company used the entire loan amount for qualifying expenses therefore, on January 25, 2022,In December 2021, the PPP Loan of $23,750 and accrued interest of $398 were forgiven and recognized as other income. During the nine months ended June 30, 2022, the Company recorded interest expense of $59.

SBA Loan

On June 3, 2020, the Company entered into a SBA Loan for $78,500 at a rate of 3.75%. On August 12, 2021 the loan increased to $114,700 and the Company obtained $36,200 on October 8, 2021. The SBA Loan matures on May 31, 2050. During the nine months ended June 30, 2022, the Company recorded interest expense of $3,187 on the SBA Loan and as of June 30, 2022 the accrued interest on the SBA Loan was forgiven$7,091.

Note 9 – Convertible Notes Payable

Secured Convertible Notes

In June 2022, the Company’s board of directors approved an offering of up to 10 Units at $50,000 per Unit in a private offering. Each Unit consists of a Secured Convertible Note with an original principal balance of $50,000 and one warrant to purchase Common Stock for every $2 invested in the offering. The warrants have an exercise price of $0.30 per share and expire five (5) years from the date of issuance (see Note 7). Each Secured Convertible Note bears interest at 15% per annum, matures 2 two years after the date of issuance, and is convertible at the option of the holder into common stock at $0.20 per share. Pursuant to a security agreement between the Company and investors in the Unit offering, and the subscription agreements executed by the SBA.Company and the investors, the Secured Convertible Notes are secured by lien on two existing electric vehicles that were owned by the Company at the time of the commencement of the offering, and eight additional electric vehicles that will be purchased with the proceeds of the offering, assuming all 10 Units are sold in the offering. The Company also granted subscribers in the Unit offering piggyback registration rights with respect to any shares of common stock issuable upon conversion of the Secured Convertible Notes or upon exercise of the warrants issued in the Unit offering.