Unless the context requires otherwise, references in this Form 10-Q to "we," "our," "us" and similar terms refer to VETANOVA INC.

Note about Forward-Looking Statements

This Form 10-Q contains forward-looking statements, such as statements relating to our financial condition, results of operations, plans, objectives, future performance and business operations. These statements relate to expectations concerning matters that are not historical facts. These forward-looking statements reflect our current views and expectations based largely upon the information currently available to us and are subject to inherent risks and uncertainties. Although we believe our expectations are based on reasonable assumptions, they are not guarantees of future performance and there are a number of important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements, including the risks described in Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2020. By making these forward-looking statements, we do not undertake to update them in any manner except as may be required by our disclosure obligations in filings we make with the Securities and Exchange Commission under the Federal securities laws. Our actual results may differ materially from our forward-looking statements.





Overview

The Company is in its development stage and intends to build and operate solar-powered, carbon-negative greenhouses utilizing Artificial Intelligence assisted technologies to control the growing environment if the Company can obtain financing. The Company's revenue is expected to come from growing farm-fresh fruits and vegetables to be sold to local markets.

The Company intends to produce farm-fresh fruits and vegetables for local delivery in historically productive agricultural regions with high solar indexes and close to large urban areas of the United States, such as the Front Range of Colorado and Central Valley of California.

In 2021 the Company acquired four contiguous parcels of land from a related party totaling 157 acres in Pueblo County Colorado.





  ? Parcel 1 - The Company issued 95,000,000 shares of its common stock and agreed
    to pay $2,368,421 by December 31, 2022, to GrowCo Partners 1, LLC for
    approximately 39 acres containing one fully completed 90,000 sq. ft.
    greenhouse, and one adjoining fully completed 15,000 sq. ft. warehouse. on the
    land. The shares were issued in book entry form on November 19, 2021. The cash
    amount will bear interest at 6% per year from August 17, 2021, until paid. The
    completed greenhouse and warehouse have not been in operation since 2020.

  ? Parcel 2 - The Company issued 5,000,000 shares of its common stock and agreed
    to pay $131, 579 by December 31, 2022, to GrowCo Partners 2, LLC for 39 acres
    of vacant land. The shares were issued in book entry form on November 29,
    2021. The cash amount will bear interest at 6% per year from August 17, 2021,
    until paid.




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  ? Parcel 3 - The Company issued 5,000,000 shares of its common stock and agreed
    to pay $131, 579 to GrowCo, Inc. by December 31, 2022, for 39 acres of vacant
    land. The shares were issued in book entry form on November 29, 2021. The cash
    amount will bear interest at 6% per year from August 17, 2021, until paid.

  ? Parcel 4 - The Company issued 15,000,000 shares of its common stock and agreed
    to pay $394,737 by December 31, 2022, to GrowCo Partners 2, LLC for 39 acres
    of land with a partially completed greenhouse structure. The shares were
    issued in book entry form on November 29, 2021. The cash amount will bear
    interest at 6% per year from August 17, 2021, until paid.

On the land in southern Colorado the Company plans to:





  ? retrofit the existing greenhouse and warehouse so that the equipment in the
    greenhouse and warehouse will run on solar power as opposed to utility
    provided electricity and propane. (Estimated cost: $9,500,000. Estimated time
    to complete: eight months) and build a solar system to power the greenhouse/
    warehouse (Estimated cost: $3,000,000)

  ? construct an additional 23 acres of greenhouse and associated warehouse space
    (Estimated cost: $45,500,000. Estimated time to complete: 36 months), and
    build solar systems to power the greenhouse and warehouse facilities
    (Estimated cost: $6,500,000)

The Company has a direct or indirect interest in the three entities listed above.

The Company plans to finance all or a part of the cost of retrofitting/ constructing greenhouses and warehouses and acquiring solar systems through future offering of the Company's securities, proceeds from the exercise of the Company's warrants or borrowings from private lenders.

As of December 31, 2021 the Company did not have any agreements with any person to purchase any of the Company's securities, or lend any funds to the Company.

On August 4, 2021 the Company entered in an agreement with Mastronardi Produce Limited pursuant to which Mastronardi was granted the exclusive right to sell and market all US Grade No. 1 Products produced from all of the Company's greenhouses in North America. For each sale, Mastronardi will be paid a low double digit percentage of the gross price received for the sale of the products grown at the Company's greenhouses, plus all costs incurred in the sale and distribution of such products.

Mastronardi is a fourth-generation family owned company and the leading marketer and distributor in North America of tomatoes, peppers, cucumbers, berries and leafy greens. Mastronardi has an extensive and long-tenured retail network and is nationally recognized under the primary SUNSET® brand and other brands, including Campari®, Angel Sweet®, Flavor Bombs®, Sugar Bombs® and WOW™ berries.

On June 22, 2022, the Company began offering up to 300,000,000 Units at a price of $0.03? per Unit, for a total of up to $10,000,000 in gross offering proceeds, assuming all Units offered are sold. Each Unit consists of one share of common stock, one Series III Warrant, and one Series IV Warrant. Each Series III Warrant allows the holder to purchase one share of our common stock at a price of $0.03? per share. Each Series IV Warrant allows the holder to purchase one share of our common stock at a price of $0.05 per share. The Series III and Series IV Warrants will expire on December 31, 2024. The minimum investment for any investor is $1,000 unless such minimum is waived by the Company in its sole discretion and on a case-by-case basis. There is no minimum offering amount or escrow required as a condition to closing, and we may sell significantly fewer Units than those offered.





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Results of Operations

For Three Months Ended June 30, 2022 and June 30, 2021

During the three months ended June 30, 2022, and June 30, 2021, there was no revenue nor direct cost of revenue.

During the three months ended June 30, 2022, the Company recognized $2,144,050 of general and administrative expenses, compared to $232,395 during the three months ended June 30, 2021. The increase of $1,911,655 was due to a charge of $2,043,572 for shares issued to an investor relations firm, partially offset by reducing operating expenses during its initial stage to conserve capital.

Interest expense was $21,947 for the three months ended June 30, 2022 compared to no interest expense during the three months ended June 30, 2021. Interest expense was due to the Company's sale of bridge notes and amounts due from asset acquisition during the last three months of its year ended December 31, 2021 and the six months ended June 30, 2022.

The minority share of the Company's consolidate loss was $1,885 for the three months ended June 30, 2022. There was a $21,021 minority share recognized for the three months ended June 30, 2021, from the consolidated subsidiary, VitaNova Solar Partners, LLC.

The above produced a net loss of $2,164,142 for the three months ended June 30, 2022 compared to a loss of $211,374 for the three months ended June 30, 2021.

For Six Months Ended June 30, 2022 and June 30, 2021

During the six months ended June 30, 2022, and June 30, 2021, there was no revenue nor direct cost of revenue.

During the six months ended June 30, 2022, the Company recognized $2,251,355 of general and administrative expenses, compared to $425,199 during the six months ended June 30, 2021. The increase of $2,033,939 was due to a charge of $2,043,572 for shares issued to an investor relations firm, partially offset by reducing operating expenses during its initial stage to conserve capital.

Interest expense was $70,950 for the six months ended June 30, 2022 compared to no interest expense during the six months ended June 30, 2021. Interest expense was due to the Company's sale of bridge notes and amounts due from asset acquisition during the last three months of its year ended December 31, 2021 and the six months ended June 30, 2022.

The minority share of the Company's consolidate loss was $1,885 for the six months ended June 30, 2022 compared to $21,021 for the six months ended June 30, 2021.

The above produced a net loss of $2,320,450 for the six months ended June 30, 2022 compared to a loss of $404,178 for the six months ended June 30, 2021.

Liquidity and Capital Resources

We have begun our operations relying on external investors. Since inception and through June 30, 2022, we have raised $2,612,566 in capital.

Our estimated capital requirements for the period ending December 31, 2022 are:





 ?   General and administrative expenses                           $      625,000

Payments related to the purchase of land in southeastern


 ?   Colorado (1)                                                  $    2,500,000

? Retrofit/expand existing greenhouses and warehouse (2) $ 9,500,000

Construction of solar system to power expanded greenhouse


 ?   and warehouse                                                 $    3,000,000

(1) See Footnote 3 of this report regarding payments we are required to make in connection with the purchase of these properties.

(2) Represents the costs to retrofit and expand an existing greenhouse and warehouse we acquired in southern Colorado.





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The Company received preliminary approval from C-PACE, a Colorado specialized solar financing program developed by federal, state and county governments. The Company is in the process of developing the engineering necessary to complete the C-Pace financing application.

We believe with additional capital from third party investors we will have sufficient capital to meet our anticipated cash needs for at least the next twelve months.

To date we have only had limited revenue, which occurred the last six months of 2020 via a sublease of farming land. Therefore, presently operations are not sufficient to sustain our operations without the additional sources of capital. As of June 30, 2022, we had cash and cash equivalents of $264. We used $234,117 in cash in our operating activities during the six months ended June 30, 2022.

See Note 2 of the notes to condensed consolidated financial statements included elsewhere in this Form 10-Q for a discussion of our significant account policies.

Critical Accounting Policies

We have identified the policy below as critical to our business operations and the understanding of our results from operations.

Impairment Policy. At least once every year, management examines all of our assets for proper valuation and to determine if an impairment is necessary. In terms of real estate owned, this impairment examination also includes accumulated depreciation. Management examines market valuations and if an additional impairment is necessary, an impairment charge is recorded.

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