UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

COMMISSION FILE NUMBER 001-41560

(ADAMAS ONE CORP LOGO)

ADAMAS ONE CORP.

(Exact Name of registrant as specified in its charter)

Nevada	83-1833607
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

17767 N. Perimeter Drive, Suite B115, Scottsdale, AZ	85255
(Address of principal executive offices)	(Zip Code)

(480)356-8798

(Registrant’s telephone number, including area code)

Title of each class:		Trading Symbol(s)		Name of each exchange on which registered:
Common Stock, $0.001 par value		JEWL		The Nasdaq Stock market, LLC (Nasdaq Capital Market)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and 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 and post such files). Yes x No o

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

Large accelerated filer o

Accelerated filer o

Non-accelerated Filer x

Smaller reporting company x

Emerging growth company x

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. o

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

As of May 10, 2023, the issuer had 23,111,526 shares of Common Stock outstanding.

ADAMAS ONE CORP.

Table of Contents

		Page

PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)
	Condensed Balance Sheets	3
	Condensed Statements of Operations	4
	Condensed Statements of Stockholders’ Equity (Deficit)	5
	Condensed Statements of Cash Flows	6
	Notes to Condensed Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	17
Item 4.	Controls and Procedures	17
PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	18
Item 1A.	Risk Factors	18
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	18
Item 3.	Defaults Upon Senior Securities	18
Item 4.	Mine Safety Disclosures	18
Item 5.	Other Information	18
Item 6:	Exhibits	19
SIGNATURES		20

ADAMAS ONE CORP.

CONDENSED BALANCE SHEETS

	March 31,			September 30,
	2023			2022
	(Unaudited)
ASSETS
Current Assets:
Cash	$	905,684		$	88,235
Accounts receivable, net of allowance		1,394,251			1,277,368
Inventory		895,000			58,690
Total Current Assets		3,194,935			1,424,293

Property and Equipment, net		1,942,898			640,002

Other Assets:
Goodwill		5,413,000			5,413,000
Other intangible assets, net		462,000			498,000
Right of use assets - operating leases		1,368,243			-
Other		12,800			12,800
TOTAL ASSETS	$	12,393,876		$	7,988,095

LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)

Current Liabilities:
Accrued liabilities	$	2,364,046		$	442,645
Accrued interest		158,595			509,620
Payroll and related		3,748,710			2,924,172
Due to related party - notes payable		-			558,658
Working capital deficit - asset purchase		457,912			457,912
Notes payable and convertible term notes, net		472,500			7,882,500
Current portion of operating lease liability		176,550			-
Total Current Liabilities		7,378,313			12,775,507

Long-Term Liabilities:
Operating lease liability, net of current portion		1,195,586			-

Total liabilities		8,573,899			12,775,507

Stockholders’ Equity (Deficit)

Common stock, $0.001 par value, 100,000,000 shares authorized 22,506,526 and 16,369,423 shares issued and 22,156,526 and 16,369,423 shares outstanding at March 31, 2023 and September 30, 2022, respectively		22,505			16,369
Treasury stock 350,000 shares, at cost		(1,200,000	)		-
Additional paid-in capital		60,237,063			36,511,950
Accumulated deficit		(55,239,591	)		(41,315,731	)
Total Stockholders’ Equity (deficit)		3,819,977			(4,787,412	)
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)	$	12,393,876		$	7,988,095

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

ADAMAS ONE CORP.

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)


	For The Three Months Ended						For The Six Months Ended
	March 31,						March 31,
	2023			2022			2023			2022
Net Revenues
Diamond sales	$	113,931		$	484,519		$	840,056		$	484,519

Cost of Revenues		45,152			146,600			179,998			146,600
Gross Profit		68,779			337,919			660,058			337,919

Operating Expenses

Selling, general and administrative		3,283,967			625,185			5,845,446			1,288,783
Employee salaries and related expenses		1,604,775			3,588,860			6,269,590			3,828,536
Severance expenses		-			43,000			-			43,000
Depreciation and amortization expense		98,852			96,250			197,704			192,500
Total operating expenses		4,987,594			4,353,295			12,312,740			5,352,819

Loss from Operations		(4,918,815	)		(4,015,376	)		(11,652,682	)		(5,014,900	)

Other Expenses
Interest expense		(27,132	)		(94,677	)		(2,271,178	)		(199,314	)

Total Other Expenses		(27,132	)		(94,677	)		(2,271,178	)		(199,314	)

Loss before income taxes		(4,945,947	)		(4,110,053	)		(13,923,860	)		(5,214,214	)

Provision for income taxes		-			-			-			-
Net Loss	$	(4,945,947	)	$	(4,110,053	)	$	(13,923,860	)	$	(5,214,214	)

Net Loss Per Share
Basic and diluted
Weighted average number of shares outstanding		21,861,035			19,377,468			19,616,301			19,006,812
Loss per share-basic and diluted	$	(0.23	)	$	(0.21	)	$	(0.71	)	$	(0.27	)

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

ADAMAS ONE CORP.

CONDENSED STATEMENTS OF STOCKHOLDERS ’ EQUITY (DEFICIT)

(Unaudited)


	Common Stock					Additional
	Shares					Paid-In		Treasury			Accumulated
	Outstanding			Par Value		Capital		Stock			(Deficit)			Total
Balance at September 30, 2021		18,651,750		$	18,652	$	23,870,976		-		$	(30,247,873	)	$	(6,358,245	)
Common stock issued to board members		20,000			20		79,980		-			-			80,000
Common stock issued for incentive to lender		14,667			14		58,655		-			-			58,669
Net loss		-			-		-		-			(1,104,161	)		(1,104,161	)
Balance at December 31, 2021		18,686,417		$	18,686	$	24,009,611		-		$	(31,352,034	)	$	(7,323,737	)

Common stock issued to board members		20,000			20		79,980		-			-			80,000
Common stock issued for cash at $4.00		25,000			25		99,975		-			-			100,000
Common stock issued to employees		850,000			850		3,399,150		-			-			3,400,000
Common shares issued from converted interest		25,708			26		102,806		-			-			102,832
Net loss		-			-		-		-			(4,110,053	)		(4,110,053	)
Balance at March 31, 2022		19,607,125		$	19,607	$	27,691,522		-		$	(35,462,087	)	$	(7,750,958	)

Balance at September 30, 2022		16,369,423		$	16,369	$	36,511,950		-		$	(41,315,731	)	$	(4,787,412	)
Common stock issued for conversion of notes and accrued interest		1,813,845			1,814		6,266,585		-			-			6,268,399
Common stock issued to employees		920,000			920		3,679,080		-			-			3,680,000
Common stock issued for IPO, net of costs of $1,892,250		2,450,000			2,450		9,130,300		-			-			9,132,750
Warrants issued		-			-		2,038,000		-			-			2,038,000
Repurchase stock		(350,000	)		-		-		(1,200,000	)		-			(1,200,000	)
Net loss		-			-		-		-			(8,977,913	)		(8,977,913	)
Balance at December 31, 2022		21,203,268		$	21,553	$	57,625,915	$	(1,200,000	)	$	(50,293,644	)	$	6,153,824

Common Stock issued to employees		225,000			225		772,775		-			-			773,000
Common Stock issued for consulting services		632,500			632		1,559,068		-			-			1,559,700
Common stock issued for conversion of note and accrued interest		95,758			95		279,308		-			-			279,400
Net loss		-			-		-		-			(4,945,947	)		(4,945,947	)
Balance at March 31, 2023		22,156,526		$	22,505	$	60,237,063	$	(1,200,000	)	$	(55,239,591	)	$	3,819,977

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

ADAMAS ONE CORP.

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)


	For The Six Months Ended
	March 31,
	2023			2022
OPERATING ACTIVITIES
Net loss	$	(13,923,860	)	$	(5,214,214	)
Adjustments to reconcile net loss to net cash used in operations:
Stock based compensation and expenditures		6,012,700			3,618,668
Stock issued for interest		137,798			102,832
Warrants issued for conversion		2,038,000			-
Depreciation and amortization		197,704			192,500
Amortization of debt discount		-			36,836
Allowance for doubtful accounts		72,600			-
Changes in assets and liabilities:
Accounts receivable		(189,483	)		(484,519	)
Inventory		(836,310	)		(77,274	)
Other current assets		-			9,613
Accrued liabilities		1,921,402			259,727
Accrued interest		(351,025	)		59,646
Accrued payroll and related		824,538			168,714
Severance obligation		-			43,000
Right of use assets - operating leases, net		3,893			-
Total adjustments to reconcile net loss to net cash used in operations:		9,831,817			3,929,743
Net cash used in operating activities		(4,092,043	)		(1,284,471	)

INVESTING ACTIVITIES
Machinery & equipment		(1,464,600	)		-
Net cash used in investing activities		(1,464,600	)		-

FINANCING ACTIVITIES
Notes payable proceeds (payments)		(1,000,000	)		945,000
Due to related party		(558,658	)		67,898
Purchase of treasury stock		(1,200,000	)		-
Cash from stock sale, net of costs of $1,892,250		9,132,750			100,000
Net cash provided by financing activities		6,374,092			1,112,898

Net cash increase (decrease) for the period	$	817,449		$	(171,573	)
Cash, beginning of period		88,235			261,819
Cash, end of the period	$	905,684		$	90,246

Supplemental disclosure of cash flow information:
Cash paid for interest	$	-		$	-
Cash paid for income taxes	$	-		$	-
Non-cash investing and financing activities are as follows:
Stock-based compensation	$	6,012,700		$	3,618,668
Stock for interest	$	137,798		$	102,832
Warrants issued for conversion	$	2,038,000		$	-
Conversion of debt to equity	$	6,155,000		$	-
Stock for board member services	$	-		$	160,000
Stock for lenders incentive	$	-		$	58,669

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

ADAMAS ONE CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

For the Six Months Ended March 31, 2023 and 2022

NOTE 1 – ORGANIZATION AND BUSINESS ACTIVITY

We were incorporated on September 6, 2018, in the state of Nevada for the purpose of acquiring existing technology that would efficiently and effectively produce lab-grown, environmentally friendly, ethically sourced diamonds. On January 31, 2019, we entered into an Amended Asset Purchase Agreement with Scio Diamond Technology Corporation, or Scio, which was subsequently amended February 3, 2020, pursuant to which we acquired substantially all of the assets of Scio, which assets consisted primarily of proprietary diamond growing chemical reactors, which we refer to as diamond growing machines, patents, and all intellectual property related thereto, for an aggregate of 1,500,000 shares of our common stock and payment to certain lenders of Scio of an aggregate of $2.1 million in cash. In addition, we agreed to pay one-half of certain other unsecured operational liabilities of Scio. The transaction was approved by a majority of the Scio stockholders voting in person or by proxy at a special meeting of stockholders held commencing on June 7, 2019 and reconvening on August 6, 2019. The transaction closed on October 17, 2019. We recorded the net value of the assets purchased and liabilities assumed at $8.65 million.

Since acquiring the assets of Scio, we have continued to further develop the technologies acquired from Scio, and we have begun producing diamonds for fine jewelry and diamond material for industrial uses.

NOTE 2 – GOING CONCERN

The accompanying condensed financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We incurred a net loss of $13.9 million and used approximately $4.1 million of cash in operations for the six months ended March 31, 2023. Further information related to a going concern may be obtained in NOTE 2 of the Company’s 2022 audited financial statements for the year ended September 30, 2022, and in the Going Concern Uncertainty paragraph in the Report of Independent Registered Public Accounting Firm, also contained in the above referenced financial statements. These conditions raise substantial doubt about our ability to continue as a going concern for the following year.

We will need additional financing to implement our full business plan and to service our ongoing operations. There can be no assurance that we will be able to secure any needed funding, or that if such funding is available, the terms or conditions would be acceptable to us. If we are unable to obtain additional financing when it is needed, we will need to restructure our operations and possibly divest all or a portion of our business. We may seek additional capital through a combination of equity offerings and debt financings. Debt financing, if obtained, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, and could increase our expenses and require that our assets secure such debt. Equity financing, if obtained, could result in dilution to our existing stockholders and/or require such stockholders to waive certain rights and preferences. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classification of liabilities or any other adjustment that might be necessary should we be unable to continue as a going concern.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Presentation

The condensed financial statements included herein have been prepared by us without audit pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with our audited financial statements for the year ended September 30, 2022. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by the SEC, although we believe the disclosures that are made are adequate to make the information presented herein not misleading.

The accompanying condensed financial statements reflect, in our opinion, all normal recurring adjustments necessary to present fairly our financial position at March 31, 2023 and the results of our operations and cash flows for the periods presented.

Interim results are subject to seasonal variations, and the results of operations for the six months ended March 31, 2023, are not necessarily indicative of the results to be expected for the full year.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made in preparing the financial statements include, but are not limited to, the following: collectability of accounts receivable, the potential impairment of goodwill, valuation of deferred tax assets, carrying value of inventories, useful lives and recovery of equipment and other intangible assets, and valuation of stock-based compensation.

Cash and Cash Equivalents

For purposes of the statements of cash flows, we consider highly liquid financial instruments purchased with a maturity of three months or less at the time of purchase to be cash equivalents.

Accounts Receivable

We follow the allowance method of recognizing uncollectible accounts receivable, which recognizes bad debt expense based on a review of the individual accounts outstanding and our prior history of uncollectible accounts receivable. We extend credit based on an evaluation of each customer’s financial condition, and our receivables are generally unsecured. Accounts receivable are stated net of an allowance for doubtful accounts in the balance sheet. We consider accounts past due if outstanding longer than contractual payment terms. We record an allowance based on consideration of a number of factors, including the length of time trade accounts are past due, our previous loss history, the creditworthiness of individual customers, economic conditions affecting specific customer industries, and economic conditions in general. We charge-off accounts receivable after all reasonable collection efforts have been exhausted. We credit payments subsequently received on such receivables to bad debt expense in the period we receive the payment.

As of March 31, 2023, we had established an allowance of $355,850 for potentially uncollectible accounts receivable. We record delinquent finance charges on outstanding accounts receivable only if they are collected.

Property and Equipment

We recorded property and equipment purchased at cost. We compute depreciation, after equipment is placed in service, using the straight-line method at rates intended to depreciate the cost of assets over their estimated useful lives, which are generally four to ten years. Upon retirement or sale of property and equipment, we will remove the cost of the disposed assets and related accumulated depreciation from the accounts and any resulting gain or loss is credited or charged to selling, general, and administrative expenses. We charge expenditures for normal repairs and maintenance to expense as incurred. We capitalize additions and expenditures for improving or rebuilding existing assets that extend the useful life. Leasehold improvements made either at the inception of the lease or during the lease term will be amortized over the shorter of their economic lives or the lease term including any renewals that are reasonably assured.

Goodwill

Goodwill represents the excess of fair value over identifiable tangible and intangible net assets acquired in the Scio business combination. Goodwill is not amortized, instead goodwill is reviewed for impairment at least annually, or on an interim basis between annual tests when events or circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than it’s carrying value. The goodwill that arose from the Scio asset purchase agreement was independently valued at $5,413,000 as of August 7, 2019. We completed our last annual goodwill impairment test in our fourth quarter for the fiscal year ended September 30, 2022, and as a result of the annual test management determined that no change was needed to the carrying value of goodwill at September 30, 2022 or as of March 31, 2023.

Impairment of Long-Lived Assets

We continually monitor events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, we assess the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the total of the future cash flows is less than the carrying amount of those assets, we recognize an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. No impairment expense was recognized for the six months ended March 31, 2023 and 2022.

Revenue Recognition

We generate revenue from the sale of diamonds that have been produced or purchased. We recognize revenue according to Accounting Standards Codification 606 – Revenue from Contracts with Customers (“ASC 606”). When the customer obtains control over the promised goods or services, we record revenue in the amount of consideration that we can expect to receive in exchange for those goods. We apply the following five-step model to determine revenue recognition:

●

identification of a contract with a customer;

●

identification of the performance obligations in the contact;

●

determination of the transaction price;

●

allocation of the transaction price to the separate performance obligations; and

●

recognition of revenue when performance obligations are satisfied.

We only apply the five-step model when it is probable that we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer. At contract inception and once the contract is determined to be within the scope of ASC 606, we assess the goods or services promised within each contract and determine those that are performance obligations and assess whether each promised good or service is distinct. Our contracts contain a single performance obligation (delivery of diamonds), and the entire transaction price is allocated to the single performance obligation. We recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Accordingly, we recognize revenue when the customer obtains control of our product, which typically occurs upon delivery of the product. Our credit terms are currently that payment is due within 120 days. In the three months ended March 31, 2023 the Company placed $630,000 in sales value on consignment with a cost value of $245,000. No revenue has been recognized on the consigned merchandise.

Disaggregated Revenue Information

We have no disaggregated revenue to report for the six months ended March 31, 2023 or 2022. We continue to have one primary wholesale customer.

Advertising Costs

We plan to expense advertising costs as they are incurred. We have incurred no advertising costs to date.

Inventories

We state inventories at the lower of cost or net realizable value in the following manners. We determine cost using the average cost method on all inventory generated by our manufacturing operations upon our transition from research and development in our manufacturing facility to the full production of our products for sale. We also purchase lab-grown diamonds from a vendor who cuts and polishes the majority of our manufactured diamonds as the vendor has access to other lab-grown diamonds that may supplement the inventory needed by the company or which may be unique in nature which may appeal to our customers or be used in design of our proprietary jewelry line which is under development. We carry the value of these purchased diamonds at the lower of cost or net realizable value. At March 31, 2023, our inventory consisted of finished and nearly finished precious stones in various carat sizes, shapes, and colors that we produced or purchased. At September 30, 2022, our inventory consisted primarily of finished and nearly finished precious stones in various carat sizes, shapes, and colors which we produced.

Stock-Based Compensation

We account for stock-based compensation at estimated fair value on the date of grant. There were 1,145,000 shares of common stock granted to 11 employees for their service to the Company during the six months ended March 31, 2023. Each employee’s shares were fully vested upon issuance and expensed in full during the six months ended March 31, 2023. These shares were valued between $4.00 and $2.84 per share an approximate average of $3.89 per share, or an aggregate of $4,453,000.

In addition, the Company issued 666,413 warrants upon the conversion of $4.1 million in debt. These warrants were valued at $2,038,000 using Black-Scholes with the following significant terms. Term 5 year, volatility 80%, risk-free interest rate 3%, expected dividend yield 0%.

There were 850,000 shares granted for employees valued at $4.00 per share for which the $3.4 million was fully expensed during the six months ended March 31, 2022.

The price per share was based upon sales of our common stock near the date of grant. The grants are fully vested and are recognized upon the date of grant.

Concentrations of Credit Risk

Accounts at banks are insured by the Federal Deposit Insurance Corporation, or the FDIC, up to $250,000. As of March 31, 2023, our bank account balance exceeded the federally insured limit. We mitigate this exposure by using a high credit financial institution. We have one wholesale customer, representing substantially all of our accounts receivable.

Income Taxes

We account for income taxes under the asset and liability method in accordance with Accounting Standards Codification 740 - Income Taxes, or ASC 740. We recognize deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. We measure deferred tax assets and liabilities using enacted tax rates expected to apply to taxable amounts in years in which those temporary differences are expected to be recovered or settled. If it is more likely than not that some portion or all of a deferred tax asset will not be realized, a valuation allowance is recognized. We reflect changes in recognition or measurement in the period in which the change in judgment occurs. We currently have substantial net operating loss carryforwards. We have recorded a valuation allowance equal to the net deferred tax assets due to the uncertainty of the ultimate realization of the deferred tax assets.

Contingencies

Certain conditions may exist as of the date the financial statements are issued that may result in a loss to us but will only be resolved when one or more future events occur or fail to occur. We assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to potential unasserted claims that may result in legal proceedings against us, we evaluate the perceived merits of any claims and the perceived merits of the amount of relief sought or expected to be sought therein and determine if any loss is likely.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability is reasonably estimated, the estimated liability would be accrued in our financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of range of possible loss if determinable and material, would be disclosed. There were no known loss contingencies identified as of March 31, 2023. (See NOTE 6 below for additional information)

Loss Per Common Share

We calculate basic loss per share using the weighted average number of shares of common stock outstanding during each reporting period. Diluted loss per share includes potentially dilutive financial instruments, such as convertible term notes and related interest. We excluded 823,499 and 1,627,304 shares from the weighted average diluted common shares outstanding for March 31, 2023 and 2022, respectively, because their inclusion would have been antidilutive. These shares are what would have been issued if the convertible debt, plus accrued interest had converted for each of the six months ended March 31, 2023 and 2022.

Recently Issued Accounting Pronouncement

Adopted

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The update improves financial reporting about leasing transactions by requiring a lessee to record on the balance sheet the assets and liabilities for the rights and obligations created by lease terms of more than 12 months. We adopted ASU 2016-02 in the six months ended March 31, 2023. We completed the process of aggregating and evaluating lease arrangements and implementing new processes during the six months ended March 31, 2023. As a result of evaluating the impact of adoption of the ASU on our financial statements we recognized a right-of-use asset and lease liability on our balance sheet for our real estate operating leases. At October 1, 2022 we recognized a right of use asset of $1.4 million, and a lease liability of $1.4 million.

NOTE 4 – INVENTORIES

As of March 31, 2023 and September 30, 2022, the inventory balances were composed of finished goods and partially finished goods carried at the value of the costs associated with the manufacturing of the goods. As of March 31, 2023, $295,935 is composed of diamonds manufactured by the Company, $354,065 was inventory purchased from another source. In addition, $245,000 of inventory is held on consignment.

NOTE 5 – PROPERTY AND EQUIPMENT

Property and equipment are listed net of the related accumulated depreciation as of March 31, 2023 and September 30, 2022. As of March 31, 2023. The Company has a deposit on equipment on order in the amount of $1.3 million, which represents approximately 50% of the total purchase price. As the equipment is not yet in service, it is not being depreciated.

Depreciation expense for the six months ended March 31, 2023 and 2022 totaled $161,704 and $156,500 respectively.

NOTE 6 – COMMITMENTS AND CONTINGENCIES

Indemnifications

During the normal course of business, we make certain indemnities and commitments under which we may be required to make payments in relation to certain transactions. These may include (i) indemnities to vendors and service providers pertaining to claims based on negligence or willful misconduct; and (ii) indemnities involving the representations and warranties in certain contracts. In addition, under our bylaws we are committed to our directors and officers for providing for payments upon the occurrence of certain prescribed events. The majority of these indemnities and commitments do not provide for any limitation on the maximum potential for future payments that we could be obligated to make. We have not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, we believe the estimated fair value of these agreements is minimal. Accordingly, we had no liabilities recorded for these agreements as of March 31, 2023 and September 30, 2022.

Leases

We are obligated under a triple-net operating lease for our 6,475 square foot manufacturing facility located in Greenville, South Carolina, which is classified as an operating lease. The terms of the lease require a payment of approximately $10,000 per month, which includes an estimate for utilities, taxes, and repairs. This lease expires in August 2023.

We believe this facility will be adequate to meet our current needs based on the property and equipment currently owned. However, our business plan will require additional space, and we will be making plans to expand our building footprint at possible new or additional locations to accommodate additional manufacturing equipment. As part of the initial expansion discussed above, we have entered into a lease for 23,485 square feet of additional manufacturing space in Greenville, South Carolina, expiring in July 2036. In addition, we have a lease for 3,414 square feet of office space in Scottsdale, Arizona, expiring in September 2024. The office is to facilitate the administration and marketing of expanding the manufacturing aspect of our company as well as to administer increased management anticipated in areas of human resources, finance, accounting, and financial analysis as well as sales and marketing to manage the growth in the production output as a result of the second facility in Greenville, South Carolina. We intend to pay for these improvements using a combination of working capital, new debt financing, and equity offerings.

The weighted average remaining lease term and weighted average discount rate for operating leases were 11.9 years and 5.0%, respectively. The operating lease cost for the six months ended March 31, 2023 was approximately $156,000.

The future minimum lease payment required under our leases as of March 31, 2023 are as follows:


2023	$	191,331
2024		178,649
2025		129,168
2026		134,060
2027		140,910
Thereafter		1,045,082
Total undiscounted cash flows		1,819,200
Less: present value discount (5% per annum)		(447,064	)
Total lease liabilities	$	1,372,136

Employment Agreements

We have entered into five separate employment agreements that provide for stock to be issued annually in varying amounts through fiscal 2025. The price per share to be included in employee stock compensation expense will be based upon the fair market value of the stock on the date of grant. The grants are fully vested, pending the service requirement of continued employment.

We also have salary commitments contained in our various employment agreements through fiscal year 2025.

After 2025, one salary continues to increase at 9% per year from its approximately $280,000 2025 base salary.

Additional Compensation

In addition to the above stock commitments, we have agreed to provide certain executive officers with compensation paid in diamonds. These commitments amount to issuing 9.5 carats of diamonds per month through September 2024 and 2.5 carats of diamonds per month through October 2025. For the six months ended March 31, 2023 and 2022 this obligation has been accrued at a valuation of $1,000 per carat, which is based on management’s estimate of the market value of the diamonds.

Litigation

During December 2022, we became a party to a class action filing previously between Scio and a class action investor. We have retained outside counsel specifically for this matter and are working with other defendants named in this matter to increase our chance of prevailing. On February 17, 2023 the Company filed a motion to dismiss the class action in concert with Scio which filed a separate motion to dismiss this class action. Our approach will continue to seek a dismissal on all items related to this legal action. We believe the case is without merit and will defend our position vigorously. Based on the Company’s assessment of a favorable decision by the court no liability has been recorded on our balance sheet at March 31, 2023.

NOTE 7 – NOTES PAYABLE AND CONVERTIBLE TERM NOTES

On December 23, 2022 we reduced the original $255,000 principal balance by $250,000 on our December 21, 2021, 10% secured promissory note with a private lender with a maturity date of March 31, 2023, with the same private lender. On March 7, 2023 we paid the remaining $5,000 and accrued interest with 20,000 shares of our common stock that were issued to the investor as payment in full for the remaining principal and accrued interest.

From December 15, 2022 through January 26, 2023 the Company converted three notes of $50,000, $150,000 and $100,000 out of the seven separate investor notes totaling an aggregate of $700,000 which had origination dates ranging from May to September 2019 which contain an interest rate of 7% and mature on the second anniversary date of the respective notes. The notes were converted into 89,647 shares of common stock and 1,289 shares of common stock for accrued interest. The remaining balances outstanding at March 31, 2023, on these convertible term notes was $400,000.

We have a note with a private lender, dated May 14, 2019, with an original principal balance of $100,000 and an original maturity date of September 5, 2019. The note has been re-negotiated on several occasions and has a current maturity date of December 31, 2023. Accrued interest was capped at $46,500, which can be paid in shares of our common stock valued at $4 per share. The principal balance outstanding on the note at March 31, 2023 and September 30, 2022 was $72,500. The note is unsecured.

NOTE 8 – CAPITAL STOCK

Our authorized capital consists of 100,000,000 shares of common stock with a par value of $0.001 per share and 10,000,000 shares of preferred stock with a par value of $0.001 per share.

As of March 31, 2023, and 2022, we had no shares of preferred stock issued or outstanding.

As of March 31, 2023, there were 22,506,526 shares of common stock issued and 22,156,526 shares outstanding. During the six months ended March 31, 2023, we issued shares of common stock as follows:

2,450,000 shares were sold to investors for $11,025,000, before expenses of the offering in the Company’s IPO;

1,332,825 shares were issued to note holder electing to convert upon IPO valued at $4,198,399;

920,000 shares valued at $3,680,000 were granted to employees as compensation;

481,020 shares were issued for $2,070,000 for incentive to lenders;

350,000 shares of treasury stock were purchased for $1,200,000;

225,000 shares valued at $773,000 were granted to employees as compensation;

632,500 shares were issued to consultants for services valued at $1,559,700: and

95,758 shares were issued for conversion of notes and accrued interest valued at $279,400.

NOTE 9 – RELATED PARTY

Amounts due to related parties on March 31, 2023 and September 30, 2022 were $0 and $558,658, respectively, primarily for non-interest bearing, due on demand advances to our company from our President and Chief Executive Officer or entities controlled by him.

In addition, we have various employment contracts and additional compensation agreements with members of the executive team, which are discussed in Note 6 – Commitments and Contingencies.

We also have payroll and related liabilities outstanding as of March 31, 2023 and September 30, 2022 that are primarily owed to our principal officers.

NOTE 10 – INCOME TAXES

We compute income taxes using the asset and liability method in accordance with FASB ASC Topic 740, Income Taxes. Under the asset and liability method, we determine deferred income tax assets and liabilities based on the differences between the financial reporting and tax bases of assets and liabilities and measure them using currently enacted tax rates and laws. We provide a valuation allowance for the amount of deferred tax assets that, based on available evidence, are more likely than not to be realized. Realization of our net operating loss carryforward was not reasonably assured as of March 31, 2023 and September 30, 2022, and we have recorded a related valuation allowance against deferred tax assets in excess of deferred tax liabilities in the accompanying financial statements.

As of March 31, 2023 and September 30, 2022, we had federal income tax net operating loss carryforwards. We are subject to limitations existing under Internal Revenue Code Section 382 (Change of Control) relating to the availability of the operating loss, therefore utilization of a portion of our net operating loss may be limited in future years.

As of March 31, 2023 and September 30, 2022 we had no Internal Revenue Service or state tax examinations. Therefore, all periods since inception are subject to audit.

NOTE 11 – SUBSEQUENT EVENTS

The Company has issued approximately 955,000 shares if it’s common stock from March 31, 2023 through May 10, 2023 the date at which the latest shareholder report was available for the conversion of notes and accrued interest, for consultants for services and for board member services.

We have analyzed our operations subsequent to the balance sheet and determined that there were no other significant subsequent events or transactions that would require recognition or disclosure in the financial statements for the six months ended March 31, 2023.

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

This document contains certain “forward-looking statements”. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue or other financial items; any statements of the plans, strategies, goals and objectives of management for future operations; any statements concerning proposed new products and services or developments thereof; any statements regarding future economic conditions or performance; any statements or belief; and any statements of assumptions underlying any of the foregoing.

Forward looking statements may include the words “may,” “could,” “estimate,” “intend,” “continue,” “believe,” “expect,” or “anticipate,” or other similar words, or the negative thereof. These forward-looking statements present our estimates and assumptions only as of the date of this report. Accordingly, readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the dates on which they are made. We do not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the dates they are made. You should, however, consult further disclosures and risk factors we included in the section titled Risk Factors contained herein.

Overview

We are a high-tech diamond company that uses our proprietary technology to produce high-quality, single crystal diamonds and diamond materials through a CVD process, which we refer to as our Diamond Technology. Lab-grown diamonds have the exact physical, chemical, and optical properties of the best mined diamonds. Lab-grown diamonds are composed of a pure carbon lattice, just like mined diamonds, and are not considered synthetic or simulant diamonds like cubic zirconia and moissanite. Simulants are other chemical compounds that resemble diamonds but do not possess the same hardness, thermal characteristics, band gap energy, and light reflectivity as diamond, whether mined or lab-grown.

We use our Diamond Technology to produce finished diamonds that we intend to sell wholesale and retail for jewelry and rough unfinished diamond materials that we intend to sell wholesale and retail for industrial uses. We are in the initial phases of commercializing diamonds and diamond materials, and our primary mission is the development of a profitable and sustainable commercial production model for the manufacture and sale of diamonds and diamond materials, which are suitable for known, emerging, and anticipated industrial, technology, and consumer applications.

Since acquiring the Scio assets over three years ago, we have focused our efforts on research and development of improvements to the fundamental CVD process. Like most high-tech manufacturers, the philosophy of continuous improvement is at our core. Our development efforts have focused on commercialization of the diamonds and diamond materials we produce, improvements in our white diamond process, improvements in our diamond seed processes, automation in our machine operation, expansion of our capacity with our existing machines, and improvements in our laser cutting procedures. The guiding principle of these efforts is to provide the highest quality diamonds and diamond materials in a consistent and high-yield manner.

We currently have limited available commercial products and have to date sold minimal diamonds or diamond materials to consumers or commercial buyers. Our current operations, until just recently, have been dedicated to the research and development of our Diamond Technology and the exploration of markets that we may exploit in the future. While we are unable to predict the timing of our entry into any market in the future, we will strive to produce on a large scale high-quality finished and raw diamond materials and to pursue related commercial opportunities.

	For The Three Months Ended						For The Six Months Ended
	March 31,						March 31,
	2023			2022			2023			2022
Net Sales	$	113,931		$	484,519		$	840,056		$	484,519
Cost of Revenues		45,152			146,600			179,998			146,600
Gross Margin		68,779			337,919			660,058			337,919

Total Operating Expenses		4,987,594			4,353,295			12,312,740			5,352,819
Loss From Operations		(4,918,815	)		(4,015,376	)		(11,652,682	)		(5,014,900	)
Other Expenses		27,132			94,677			2,271,178			199,314
Loss Before Income Taxes	$	(4,945,947	)	$	(4,110,053	)	$	(13,923,860	)	$	(5,214,214	)

Results of Operations

The following table presents summarized financial information taken from our statements of operations for the three and six months ended March 31, 2023 compared to the comparable period in 2022.

Components of Results of Operations

Net Sales

During the three and six months ended March 31, 2023, we had net sales of $113,931 and $840,056 respectively, compared to $484,519 and $484,519 net sales for the three and six months ended March 31, 2022. We anticipate deriving continuing future revenue from the following business lines:

●

Direct Sales of Diamonds: The sale of diamond gemstones direct to the consumer through our website and the sale of industrial grade diamonds direct to industrial manufacturing companies.

●

Wholesale of Diamonds: The sale of diamonds to wholesalers, distributors, and jewelers.

Cost of Revenues

Cost of revenues includes direct costs (parts, material, and labor), indirect manufacturing costs (manufacturing overhead, depreciation, plant operating lease expense, and rent), shipping, lab services, and logistics costs.

Costs of revenues for the three and six months ended March 31, 2023, were $45,152 and $179,998, respectively. Costs of revenues for the three and six months ended March 31, 2022 were $146,600 and $146,600, respectively.

Gross Margin

Gross margin for the three and six months ended March 31, 2023, was $68,779 and $660,058, respectively with a gross profit margin on diamond sales of 60% and 79% for each of those periods, respectively. Gross margin for the three and six months ended March 31, 2022, was $337,919 and $337,919, respectively with a gross profit margin on diamond sales of 70% and 70% for each of those periods, respectively.

Research and Development Expense

We conduct research and development activities to enhance existing processes and products and develop new processes and products at our facilities in Greenville, South Carolina, utilizing our personnel and strategic relationships. We expense all costs associated with our research and development efforts through either our cost of goods sold, as they are performed by the same employees who produce our finished product, or through our general and administrative expenses if the product has not been brought to market.

We expect our research and development expenses to increase for the foreseeable future as we continue to invest in research and development activities to achieve our operational and commercial goals.

Operating Expense

Operating expense includes selling, general and administrative expense, employee salaries and related expense and depreciation and amortization expense. Selling, general, and administrative expenses consist primarily of legal and professional, consulting services and all non-personnel-related expenses or depreciation and amortization. Personnel-related expenses consist of salaries, payroll taxes, benefits, and stock-based compensation. Depreciation and amortization expenses are related to the Company’s fixed assets and intangible assets.

Operating expense for the three and six months ended March 31, 2023, included in the statement of operations was approximately $5.0 million and $12.3 million, respectively, compared to $4.4 million and $5.4 million in the prior period. These increases in operating expenses for both the three and six month periods were generally due to the ramping up of its diamond manufacturing operations subsequent to completing its initial public offering in December 2022.

We expect our operating expense to increase for the foreseeable future as we scale headcount and expenses with the growth of our business, build out our manufacturing facilities, refine our production processes, drive for productivity improvements, acquire new and retain existing customers, and incur additional costs as a result of being a public company.

Other Expenses

Interest Expense

Interest expense consists of interest paid and accrued on our notes payable, promissory notes and the amortization of debt issue costs.

Interest expense was $27,132 and $2.3 million for the three and six months ended March 31, 2023, respectively, compared to $94,677 and $199,314 for the three and six month periods of the prior year. This increase in interest expense was due primarily to the warrants issued for notes converted and partly to higher net borrowings and outstanding indebtedness for the six months ended March 31, 2023, versus the six months ended March 31, 2022. The Company had lower interest expense as a result of significantly lower borrowings during the three month period ended March 31, 2023 compared with the three month period in the prior year.

Net Loss

Primarily as a result of the above factors we had a net loss of $(4.9) million and $(13.9) million compared to a net loss of $(4.1) million and $(5.2) million for the three and six months ended March 31, 2023, and March 31, 2022, respectively.

Liquidity and Capital Resources

As of March 31, 2023, we had $0.9 million of cash and cash equivalents, an increase of $0.8 million from September 30, 2022. Changes in cash flows are summarized as follows:

Operating Activities

For the six months ended March 31, 2023, net cash used in operating activities totaled approximately $4.1 million . This was primarily the result of net loss of approximately $13.9 million, increases to our period end accounts receivable of $0.2 million, an increase in our inventories of $0.8 million, and accrued interest decrease of $0.4 million which was offset primarily by accrued payroll and related of $0.8 million along with an offset by the benefit of non-cash expenses for employee stock compensation of $6.0 million and warrants issued for conversion of $2.0 million.

For the six months ended March 31, 2022, net cash used in operating activities totaled approximately $1.3 million. This was primarily the result of net loss of approximately $5.2 million offset by the benefit of non-cash expenses for employee stock compensation of $3.7 million.

Investing Activities

During the six months ended March 31, 2023, we used $1.5 million for investing activities related to purchase of machinery and equipment. During the six months ended March 31, 2022, we used no cash for investing activities.

Financing Activities

During the six months ended March 31, 2023, net cash provided by financing activities was approximately $6.4 million. This was the net effect of $9.1 million we received as net proceeds from our IPO which closed on December 14, 2022 offset by $0.6 million used to reduce related party notes, $1.0 million to reduce notes payable and $1.2 million to acquire treasury stock during the six months ended March 31, 2023.

During the six months ended March 31, 2022, net cash provided by financing activities was approximately $1.1 million.

These conditions raise substantial doubt about our ability to continue as a going concern for the ensuing year. Our independent auditors have added an explanatory paragraph in their audit opinion in regard to this uncertainty and can be found in the Company’s Annual Form 10K filing with the Securities and Exchange Commission.

Satisfaction of our Cash Obligations for the Next 12 Months

Our recent IPO which closed on December 14, 2022 gave us gross proceeds of $11.0 million before direct IPO expenses and fees associated with underwriting. These funds along with the ability to obtain additional capital through additional equity and/or debt financing are anticipated to meet our operating needs. We are not currently generating sufficient revenue to meet operating needs. In the event we cannot obtain additional capital to pursue our strategic plan, however, this would materially impact our ability to continue as a going concern.

Since inception, we have financed cash flow requirements through debt financing and the private issuance of common stock for cash and services along with advances from our CEO as well as our CEO and CFO deferring significant compensation and benefits that were earned under their respective employment contracts. If we continue to experience cash flow deficiencies, we would be required to obtain additional financing to fund operations through private common stock offerings and debt borrowings to the extent necessary to provide working capital. However, there is no assurance we would be able to obtain such financing on commercially reasonable terms, if at all.

We intend to implement and successfully execute our business and marketing strategy, continue to develop, and upgrade technology and products, respond to competitive developments, and attract, retain, and motivate qualified personnel. There can be no assurance that we will be successful in addressing such risks, and the failure to do so can have a material adverse effect on our business prospects, financial condition, and results of operations.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures, or capital resources that is material to investors.

Critical Accounting Policies

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affected the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made in preparing the condensed consolidated financial statements include the valuation of allowances for doubtful accounts, valuation of deferred tax assets, inventories, useful lives of assets, goodwill, intangible assets, and stock-based compensation. A summary of our critical accounting policies is included in our Annual Report on Form 10-K for the year ended September 30, 2022, under “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” There have been no significant changes to these policies during the six months ended March 31, 2023. For disclosure regarding recent accounting pronouncements and the anticipated impact they will have on our operations, please refer to Note 2 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended September 30, 2022.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. We carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, 2023. Based on the evaluation of these disclosure controls and procedures, our Chief Executive Officer and Chief Financial Officer concluded our disclosure controls and procedures were not effective. Our controls were ineffective due to the size of the Company and available resources. There are limited personnel to assist with the accounting and financial reporting function, which results in: (i) a lack of segregation of duties and (ii) controls that may not be adequately designed or operating effectively. Despite the existence of material weaknesses, the Company believes the financial information presented herein is materially correct and fairly presents the financial position and operating results of the six months ended March 31, 2023, and 2022 in accordance with GAAP.

Changes in internal controls

There were no changes in our internal control over financial reporting, as defined in Rule 13a-15(f) promulgated under the Exchange Act, during the quarterly period from October 1, 2022 to March 31, 2023, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

During December 2022, we became a party to a class action filing previously between Scio and a class action investor. We have retained outside counsel specifically for this matter and are working with other defendants named in this matter to increase our chance of prevailing. On February 17, 2023 the Company filed a motion to dismiss the class action in concert with Scio which filed a separate motion to dismiss this class action. Our approach will continue to seek dismissal on all items related to this legal action. We believe the case is without merit and will defend our position vigorously. Based on the Company’s assessment of a favorable decision by the court no liability has been recorded on our balance sheet at March 31, 2023.

Please reference the Contingencies section of Note 3 of our Financial Statements for additional disclosure.

ITEM 1A. RISK FACTORS

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

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

The authorized capital of the Company is 100,000,000 shares of Common Stock with a par value of $0.001 per share and 10,000,000 shares of Preferred Stock with a $0.001 par value per share.

There were no unregistered sales of the Company’s equity securities during the quarter ended March 31, 2023 that were not previously reported in a Current Report on Form 8-K except as follows:

We issued 632,500 shares of our common stock for consulting services valued at $1,559,700.

We issued 95,758 shares of our Common Stock for conversion of notes and accrued interest with a total value of $279,400.

We issued 225,000 shares of our Common Stock for employee stock grants with a total value of $773,000.

The previously mentioned securities were issued in reliance on the exemptions from registration under the Securities Act in Section 4(a)(2) of the Securities Act and/or Regulation D thereunder.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS

Exhibit No.		Exhibit
31.1*		Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for John G. Grdina.
31.2*		Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for Steven Staehr.
32.1**		Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for John G. Grdina.
32.2**		Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for Steven Staehr.

101.INS*		Inline XBRL Instance Document
101.SCH*		Inline XBRL Taxonomy Extension Schema Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Labels Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

Filed Herewith.

Furnished Herewith.

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.

ADAMAS ONE CORP.

May 22, 2023	By:	/s/ John G. Grdina
		John G. Grdina
		Chief Executive Officer

ADAMAS ONE CORP.

May 22, 2023	By:	/s/ Steven Staehr
		Steven Staehr
		Chief Financial Officer

SEC Form 10-Q filed by Adamas One Corp.