Company: GEDC
Filing Date: 2025-04-02
Form Type: 10-K
Source: 0001641172-25-002190
Chunk: 667

Company: CalEthos, Inc.
Filing Date: 2025-04-02
Form: 10-K
Item: Item 6
Chunk 667
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 the Consolidated Financial Statements

For
the Years Ended December 31, 2024 and 2023

Note
1 – Organization and Accounting Policies

ORGANIZATION AND ACCOUNTING POLICIES 

CalEthos,
Inc. (the “Company” or “we”) was incorporated on March 20, 2002 under the laws of the State of Nevada.

As
of July 2022, the Company’s board of directors resolved to focus exclusively on developing a clean-energy-powered data center (“Data
Center Campus”). As such, the Company is implementing its plan to build aa large-scale, data center campus vertically integrated with onsite geothermal
power production In addition, the Company may acquire assets and all or part of other companies operating in the clean energy or data
center infrastructure industries or invest in or joint venture with other more-established companies already in the industry that would
add value to the Company’s business strategy.

Korean
entity

On
November 5, 2021, AIQ System Inc. (“AIQ”) was incorporated in Seoul, Republic of Korea. AIQ is authorized to issue 3 million
shares of common stock. At the date of incorporation, 10,000 shares were issued to the Company for 100,000,000 Korean Won, or approximately
$89,000, for 100% ownership of AIQ. As of July 2022, AIQ was placed into a dormant state of operations.

Basis
of Presentation

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

Principles
of Consolidation

The
consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary from the formation date. All material
intercompany transactions and balances have been eliminated in consolidation.

Going
Concern and Liquidity

The
Company incurred a net loss of approximately $12,590,000 for the year ended December 31, 2024, had an accumulated deficit of approximately
$31,870,000 as of December 31, 2024 and had no recurring revenue from operations. The Company has financed its activities principally
through debt and equity financing and shareholder contributions. Management expects to incur additional losses and cash outflows in the
foreseeable future in connection with its operating activities. These conditions raise substantial doubt about the Company’s