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NOTE 1 – NATURE OF BUSINESS AND BASIS OF PRESENTATION Ocean Thermal Energy Corporation (the “Company” “us” or “we”) designs ocean thermal energy conversion power plants, seawater air conditioning and lake water air conditioning (“SWAC/LSC”) plants for large commercial properties, utilities, and municipalities. We believe these technologies provide practical solutions to three of mankind’s oldest and most fundamental needs: clean drinking water, plentiful food, and sustainable, affordable energy without the use of fossil fuels. The Company plans to provide a clean technology that continuously extracts energy from the temperature differentials between warm surface ocean water and cold deep seawater. In addition to producing electricity, our technology can efficiently desalinate seawater producing thousands of cubic meters of fresh water every day for use in agriculture and human consumption. This cold, deep, nutrient-rich water can also be used to cool buildings and for fish farming or aquaculture. Basis of Presentation The accompanying unaudited condensed consolidated financial statements and related notes have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) and presented in accordance with U. S. generally accepted accounting principles (“GAAP”). The accompanying condensed consolidated balance sheet at December 31, 2025 has been derived from audited consolidated financial statements, but does not include all disclosures required by GAAP. The accompanying unaudited condensed consolidated financial statements as of June 30, 2026, and for the three and six months ended June 30, 2026 and 2025, have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the audited consolidated financial statements and related notes to the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC. In the opinion of management, all material adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been made to the unaudited condensed consolidated financial statements. The unaudited condensed consolidated financial statements include all material adjustments (consisting of normal recurring accruals) necessary to make the unaudited condensed consolidated financial statements not misleading as required by Regulation S-X Rule 10-01. Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026, or any future periods.

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation Our unaudited condensed consolidated financial statements for the three and six months ended June 30, 2026 and 2025 include the accounts of the Company and its wholly owned subsidiary OCEES International Inc. (“OCEES”). Intercompany balances and transactions have been eliminated in consolidation. Use of Estimates In preparing financial statements in conformity with GAAP, management is required 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 the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates include the assumptions used in the valuation of equity-based transactions, valuation of derivative liabilities, and valuation of deferred tax assets. Accounts Receivable Accounts receivable consist of amounts invoiced to customers but not yet collected by the Company. The Company records an allowance for doubtful accounts to allow for any amounts that may not be recoverable, which is based on an analysis of the Company’s prior collection experience, customer creditworthiness, expected future losses and current economic trends. Accounts are considered delinquent when payments have not been received within the contractual payment terms and are written off when management determines that collection is not probable. There were no doubtful accounts as of June 30, 2026 and December 31, 2025. Revenue recognition The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers. The Company’s primary source of revenue is a long-term fixed-price contract to provide engineering and technical development services related to the design and delivery of a renewable energy system. The contract includes a series of activities such as site-specific modeling, mechanical and structural integration, and engineering validation that are delivered as part of a single, combined project outcome. These services are highly interrelated and not separately identifiable within the context of the contract. Accordingly, the Company determined that the arrangement contains a single performance obligation. Revenue is recognized over time using the cost-to-cost input method. This method compares actual costs incurred to total estimated costs to determine the percentage of completion and is used to calculate revenue earned to date. The cost-to-cost method reflects the Company’s progress toward satisfying its performance obligation and is consistent with how the project is managed internally. Contract assets are recorded when revenue recognized exceeds billings to date (contract assets). Contract liabilities are recorded when billings exceed revenue recognized (contract liabilities). These amounts are presented separately on the condensed consolidated balance sheets. There were no contract assets at June 30, 2026 or December 31, 2025. Business Segments The Company operates as a single operating and reportable segment. The Company's chief operating decision maker ("CODM") is its Chief Executive Officer, who assesses performance and allocates resources on a consolidated basis. Accordingly, the measure of segment profit or loss reviewed by the CODM is consolidated net income (loss), and segment assets are consolidated total assets, each as presented in the accompanying condensed consolidated financial statements; no reconciling differences exist. The significant segment expense categories regularly provided to the CODM are those presented separately on the face of the condensed consolidated statements of operations. There have been no changes from the most recent annual report in the basis of segmentation or in the basis of measurement of segment profit or loss. Loss per Share Basic income (loss) per share is calculated by dividing our net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted loss per share is calculated by dividing our net loss by the diluted weighted average number of shares outstanding during the period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. The weighted average shares outstanding for the three and six month periods ending June 30, 2026 and 2025 includes weighted average subscribed shares as if those shares were issued during each respective period. The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding for the three months ended June 30, 2026 and 2025 and the six months ended June 30, 2025 as they would be anti-dilutive: <table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="6" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">June 30,</td><td style="white-space: nowrap;"> </td></tr><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2026</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2025</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Shares underlying options and warrants outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">625,000</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">625,000</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Shares underlying convertible notes outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">2,094,971,293</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">103,904,402,182</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Shares underlying convertible preferred stock outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">16,687,500</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">16,687,500</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">2,112,283,793</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">103,921,714,682</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr></tbody></table> Diluted loss per share for the six months ended June 30, 2026 is calculated as follows: <table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Net income attributable to common shareholders</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">56,800,512</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Income attributable to convertible notes</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">(59,289,098 </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Expense attributable to convertible notes</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">811,833</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Diluted loss attributable to common shareholders</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">(1,676,753 </td><td style="PADDING-BOTTOM: 3px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr><tr style="height:15px;background-color:#cceeff"><td></td><td> </td><td></td><td></td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Basic shares outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"></td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">225,637,124</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Convertible notes</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">4,645,582,456</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Diluted shares outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"></td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">4,871,219,580</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td></td><td> </td><td></td><td></td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Diluted loss per share</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">(0.00 </td><td style="PADDING-BOTTOM: 3px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr></tbody></table> Recent Accounting Pronouncements In November 2024, the Financial Accounting Standards Board issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures. The standard requires disclosure of certain prescribed costs and expenses within the notes to consolidated financial statements. ASU No. 2024-03 becomes effective for the Company’s 2027 Annual Report on Form 10-K. The standard only impacts required disclosures and will not impact the Company’s financial position, results of operations, or cash flows. The Company is currently evaluating the impact of ASU No. 2024-03 on its disclosures. The Company currently believes there are no other issued and not yet effective accounting standards that are materially relevant to our condensed consolidated financial statements.

Our unaudited condensed consolidated financial statements for the three and six months ended June 30, 2026 and 2025 include the accounts of the Company and its wholly owned subsidiary OCEES International Inc. (“OCEES”). Intercompany balances and transactions have been eliminated in consolidation.

In preparing financial statements in conformity with GAAP, management is required 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 the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates. Significant estimates include the assumptions used in the valuation of equity-based transactions, valuation of derivative liabilities, and valuation of deferred tax assets.

Accounts receivable consist of amounts invoiced to customers but not yet collected by the Company. The Company records an allowance for doubtful accounts to allow for any amounts that may not be recoverable, which is based on an analysis of the Company’s prior collection experience, customer creditworthiness, expected future losses and current economic trends. Accounts are considered delinquent when payments have not been received within the contractual payment terms and are written off when management determines that collection is not probable. There were no doubtful accounts as of June 30, 2026 and December 31, 2025.

The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers. The Company’s primary source of revenue is a long-term fixed-price contract to provide engineering and technical development services related to the design and delivery of a renewable energy system. The contract includes a series of activities such as site-specific modeling, mechanical and structural integration, and engineering validation that are delivered as part of a single, combined project outcome. These services are highly interrelated and not separately identifiable within the context of the contract. Accordingly, the Company determined that the arrangement contains a single performance obligation. Revenue is recognized over time using the cost-to-cost input method. This method compares actual costs incurred to total estimated costs to determine the percentage of completion and is used to calculate revenue earned to date. The cost-to-cost method reflects the Company’s progress toward satisfying its performance obligation and is consistent with how the project is managed internally. Contract assets are recorded when revenue recognized exceeds billings to date (contract assets). Contract liabilities are recorded when billings exceed revenue recognized (contract liabilities). These amounts are presented separately on the condensed consolidated balance sheets. There were no contract assets at June 30, 2026 or December 31, 2025.

The Company operates as a single operating and reportable segment. The Company's chief operating decision maker ("CODM") is its Chief Executive Officer, who assesses performance and allocates resources on a consolidated basis. Accordingly, the measure of segment profit or loss reviewed by the CODM is consolidated net income (loss), and segment assets are consolidated total assets, each as presented in the accompanying condensed consolidated financial statements; no reconciling differences exist. The significant segment expense categories regularly provided to the CODM are those presented separately on the face of the condensed consolidated statements of operations. There have been no changes from the most recent annual report in the basis of segmentation or in the basis of measurement of segment profit or loss.

Basic income (loss) per share is calculated by dividing our net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted loss per share is calculated by dividing our net loss by the diluted weighted average number of shares outstanding during the period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. The weighted average shares outstanding for the three and six month periods ending June 30, 2026 and 2025 includes weighted average subscribed shares as if those shares were issued during each respective period. The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding for the three months ended June 30, 2026 and 2025 and the six months ended June 30, 2025 as they would be anti-dilutive: <table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="6" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">June 30,</td><td style="white-space: nowrap;"> </td></tr><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2026</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2025</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Shares underlying options and warrants outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">625,000</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">625,000</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Shares underlying convertible notes outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">2,094,971,293</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">103,904,402,182</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Shares underlying convertible preferred stock outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">16,687,500</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">16,687,500</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">2,112,283,793</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">103,921,714,682</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr></tbody></table> Diluted loss per share for the six months ended June 30, 2026 is calculated as follows: <table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Net income attributable to common shareholders</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">56,800,512</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Income attributable to convertible notes</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">(59,289,098 </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Expense attributable to convertible notes</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">811,833</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Diluted loss attributable to common shareholders</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">(1,676,753 </td><td style="PADDING-BOTTOM: 3px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr><tr style="height:15px;background-color:#cceeff"><td></td><td> </td><td></td><td></td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Basic shares outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"></td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">225,637,124</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Convertible notes</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">4,645,582,456</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Diluted shares outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"></td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">4,871,219,580</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td></td><td> </td><td></td><td></td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Diluted loss per share</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">(0.00 </td><td style="PADDING-BOTTOM: 3px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr></tbody></table>

<table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="6" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">June 30,</td><td style="white-space: nowrap;"> </td></tr><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2026</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2025</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Shares underlying options and warrants outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">625,000</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">625,000</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Shares underlying convertible notes outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">2,094,971,293</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">103,904,402,182</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Shares underlying convertible preferred stock outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">16,687,500</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">16,687,500</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">2,112,283,793</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">103,921,714,682</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr></tbody></table>

625000

2094971293

103904402182

16687500

2112283793

103921714682

<table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Net income attributable to common shareholders</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">56,800,512</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Income attributable to convertible notes</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">(59,289,098 </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Expense attributable to convertible notes</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">811,833</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Diluted loss attributable to common shareholders</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">(1,676,753 </td><td style="PADDING-BOTTOM: 3px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr><tr style="height:15px;background-color:#cceeff"><td></td><td> </td><td></td><td></td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Basic shares outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"></td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">225,637,124</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Convertible notes</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">4,645,582,456</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Diluted shares outstanding</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"></td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">4,871,219,580</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td></td><td> </td><td></td><td></td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Diluted loss per share</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">(0.00 </td><td style="PADDING-BOTTOM: 3px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr></tbody></table>

56800512

59289098 811833

-1676753

225637124

4645582456

4871219580

-0.00

In November 2024, the Financial Accounting Standards Board issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures. The standard requires disclosure of certain prescribed costs and expenses within the notes to consolidated financial statements. ASU No. 2024-03 becomes effective for the Company’s 2027 Annual Report on Form 10-K. The standard only impacts required disclosures and will not impact the Company’s financial position, results of operations, or cash flows. The Company is currently evaluating the impact of ASU No. 2024-03 on its disclosures. The Company currently believes there are no other issued and not yet effective accounting standards that are materially relevant to our condensed consolidated financial statements.

NOTE 3 – GOING CONCERN The accompanying unaudited condensed consolidated financial statements have been prepared on the assumption that we will continue as a going concern. As reflected in the accompanying unaudited condensed consolidated financial statements, we had a net loss from operations of $971,527 and used $389,862 of cash in operating activities for the six months ended June 30, 2026. Although we had net income for the six months ended June 30, 2026, the income resulted from a non-cash gain on the change in fair value of our derivative liabilities. We had a working capital deficiency of approximately $57 million and a stockholders’ deficiency of approximately $57 million as of June 30, 2026. These factors raise substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is dependent on our ability to increase sales and obtain external funding for our projects under development. We continue to apply for grant funding from the U.S. Department of Energy. Our applications focus on desalinated water, ammonia, and hydrogen production from an ocean thermal energy conversion (“OTEC”) facility. We plan to apply for funding to support projects where our technology would apply. The condensed consolidated financial statements do not include any adjustments that may result from the outcome of this uncertainty.

-971527

-389862

-57000000 -57000000

NOTE 4 – CONVERTIBLE NOTES AND NOTES PAYABLE During January and February 2025, we sold an aggregate of $55,000 of convertible note units. Each unit costs $5,000 and consists of one convertible promissory note in the amount of $5,000 and one warrant to purchase 5,000 shares of the Company’s common stock at an exercise price of $0.01 per share. The Notes bear interest at the rate of 10% per year, compounded annually, and are due on January 4, 2027 (the “Maturity Date”). The Notes will be converted into common stock of the Company automatically upon the Maturity Date at the lower of (a) $0.10 per share, or (b) 90% of the Market Price, which shall be the average closing price of the Company’s common stock on the ten trading days immediately preceding the date of conversion. However, if the United States Army has issued a contract for the supply of sustainable power and water from the Company-designed and built OTEC system prior to the Maturity Date, within five business days the Notes will automatically be converted. Notes aggregating approximately $6.9 million are in default at June 30, 2026.

55000

Each unit costs $5,000 and consists of one convertible promissory note in the amount of $5,000 and one warrant to purchase 5,000 shares of the Company’s common stock at an exercise price of $0.01 per share

0.10

January 4, 2027

6900000

NOTE 5 – DERIVATIVE LIABILITY We measure the fair value of our assets and liabilities under the guidance of ASC 820, Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosures about fair value measurements. ASC 820 does not require any new fair value measurements, but its provisions apply to all other accounting pronouncements that require or permit fair value measurement. We identified conversion features embedded within convertible debt issued. We have determined that the features associated with the embedded conversion option should be accounted for at fair value as a derivative liability. We have elected to account for these instruments together with our warrants and other fixed conversion price instruments as derivative liabilities as we cannot determine if a sufficient number of shares would be available to settle all potential future conversion transactions. We value the derivative liabilities using a binomial option pricing-valuation model. The derivative liabilities are valued at each reporting date and the change in fair value is reflected as change in fair value of derivative liability. Following is a description of the valuation methodologies used to determine the fair value of our financial liabilities, including the general classification of such instruments pursuant to the valuation hierarchy: <table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">Fair Value </td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">Quoted market pricesfor identicalassets/liabilities(Level 1)</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">Significant otherobservable inputs(Level 2)</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">Significantunobservable inputs(Level 3)</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Derivative Liability, June 30, 2026</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">16,399,825</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">-</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">-</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">16,399,825</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Derivative Liability, December 31, 2025</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">75,688,923</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">-</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">-</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">75,688,923</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr></tbody></table> The reconciliation of the derivative liability for the six months ended June 30, 2026 and 2025 is as follows: <table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="6" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">For the Six Months Ended June 30,</td><td style="white-space: nowrap;"> </td></tr><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2026</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2025</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Derivative liability as of January 1</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">75,688,923</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">9,423,915</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Addition to derivative instruments</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">-</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">55,000</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Derivative liability extinguished upon conversion of notes payable</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">-</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">(20</td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Change in fair value of derivative liability</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">(59,289,098</td><td style="PADDING-BOTTOM: 1px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">94,358,520</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Derivative liability as of June 30</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">16,399,825</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">103,837,415</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr></tbody></table> The fair value of the derivative liability was estimated using a binomial option pricing model. The fair value at the commitment and remeasurement dates for our derivative liabilities were based upon the following significant inputs: <table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="6" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">For the Six Months Ended June 30,</td><td style="white-space: nowrap;"> </td></tr><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2026</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2025</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Expected dividends</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">0%</td><td style="width:1%;white-space: nowrap;"></td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">0%</td><td style="width:1%;white-space: nowrap;"></td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Expected volatility</td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">182%-731%</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">400%-667%</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Risk free interest rate</td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">3.68%-4.15%</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">3.79%-4.41%</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Expected term (in years)</td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">0.25– 3.76 years</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">0.25– 4.76 years</td><td style="width:1%;white-space: nowrap;"> </td></tr></tbody></table>

<table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">Fair Value </td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">Quoted market pricesfor identicalassets/liabilities(Level 1)</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">Significant otherobservable inputs(Level 2)</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">Significantunobservable inputs(Level 3)</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Derivative Liability, June 30, 2026</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">16,399,825</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">-</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">-</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">16,399,825</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Derivative Liability, December 31, 2025</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">75,688,923</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">-</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">-</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">75,688,923</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr></tbody></table>

16399825

75688923

<table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="6" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">For the Six Months Ended June 30,</td><td style="white-space: nowrap;"> </td></tr><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2026</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2025</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Derivative liability as of January 1</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">75,688,923</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">9,423,915</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Addition to derivative instruments</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">-</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">55,000</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Derivative liability extinguished upon conversion of notes payable</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">-</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">(20</td><td style="width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Change in fair value of derivative liability</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">(59,289,098</td><td style="PADDING-BOTTOM: 1px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> </td><td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">94,358,520</td><td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Derivative liability as of June 30</td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">16,399,825</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td><td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">103,837,415</td><td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> </td></tr></tbody></table>

75688923

9423915

0 55000 0 -20

59289098

-94358520

16399825

103837415

<table cellpadding="0" style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%"><tbody><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="6" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">For the Six Months Ended June 30,</td><td style="white-space: nowrap;"> </td></tr><tr style="height:15px"><td> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2026</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td><td style="white-space: nowrap;"> </td><td class="hdcell" colspan="2" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;">2025</td><td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Expected dividends</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">0%</td><td style="width:1%;white-space: nowrap;"></td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">0%</td><td style="width:1%;white-space: nowrap;"></td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Expected volatility</td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">182%-731%</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">400%-667%</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#cceeff"><td style="vertical-align:top;">Risk free interest rate</td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">3.68%-4.15%</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">3.79%-4.41%</td><td style="width:1%;white-space: nowrap;"> </td></tr><tr style="height:15px;background-color:#ffffff"><td style="vertical-align:top;">Expected term (in years)</td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">0.25– 3.76 years</td><td style="width:1%;white-space: nowrap;"> </td><td style="width:1%;white-space: nowrap;"> </td><td colspan="2">0.25– 4.76 years</td><td style="width:1%;white-space: nowrap;"> </td></tr></tbody></table>

0 0 1.82 7.31 4 6.67 0.0368 0.0415 0.0379 0.0441 P0Y3M P3Y9M3D P0Y3M P4Y9M3D

NOTE 6 – STOCKHOLDERS’ EQUITY Common Stock During the six months ended June 30, 2025, we entered into stock purchase agreements with a number of investors. The investors agreed to purchase 6,750,000 shares of common stock, and we received aggregate proceeds of $135,000. As of June 30, 2026, we have entered into stock purchase agreements to purchase 35,625,000 shares and have received aggregate proceeds of $447,500. To date, no shares of common stock have been issued pursuant to these agreements. Preferred Stock On July 1, 2026, our board of directors approved the issuance of 150 shares of Series E Preferred Stock with a par value of $0.001. The Preferred Shares have a liquidation value of $10,000 per share and bear an annual cumulative dividend of 8.0%, payable in cash or shares of the company’s common stock. The newly authorized Preferred Shares will convert into common shares if the Company: executes a power purchase agreement or other commercial contract relating to ocean thermal energy conversion power, desalinated water, cooling, or related infrastructure services; undergoes a change of control; or makes a significant public offering of its shares. The number of common shares issuable upon conversion of each Preferred Share will be based on the volume-weighted average trading price of the Company’s common stock over the ten trading days before the conversion, multiplied by 0.5. After two years, we may redeem the Preferred Shares at any time before they have converted. The Preferred Shares have limited voting rights, generally in connection with authorizing shares senior to the Preferred Shares, changing the terms of the Preferred Shares, redeeming shares, or declaring bankruptcy. In anticipation of the approval of the issuance of the Series E Preferred Stock, we executed documents for the sale of 2 shares of Series E stock and received proceeds of $20,000 during June 2026.

6750000

135000

35625000

447500

150

0.001

10000

0.080

20000

NOTE 7 – COMMITMENTS AND CONTINGENCIES From time to time, the Company may be involved in legal proceedings and regulatory proceedings arising from its operations. Management established reserves for specific liabilities in connection with legal actions that management deems to be probable and estimable. Certain lawsuits, claims and proceedings are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. While the outcome of litigation cannot be predicted with certainty, and some of these lawsuits, claims or proceedings may be determined adversely to the Company, management does not believe that the disposition of any such pending matters is likely to have a material adverse effect on the Company’s financial condition or operation, although the resolution in any reporting period of one or more of these matters could have a material adverse effect on the Company’s results of operations for that period. Accrued Salaries and Related Taxes As of June 30, 2026 and December 31, 2025, the Company has $7,291,850 and $7,001,790, respectively, in accrued payroll attributable to previous periods that has not been paid due to cash flow constraints. It is possible, at a future date, that some or all of this amount may be derecognized and result in a gain on the extinguishment of these liabilities in a future period. Professional Services Agreement On January 7, 2025, the Company entered into a Professional Services Agreement with Johnson Controls Government Systems, LLC, which provided for the design, engineering and pricing estimation for an Ocean Thermal Energy Conversion and Ocean Water Desalinization Potable Water solution on the island of Kwajalein. The contract includes a fixed fee of $3,504,796 and was completed in July 2026.

7291850

7001790

3504796

NOTE 8 – RELATED-PARTY TRANSACTIONS In May 2023, we entered into a 36-month agreement with a company controlled by our chief executive officer for shared use of an office and facilities at $1,000 per month, increasing to $1,200 per month on May 1, 2024 and $1,400 per month on May 1, 2025. On May 1, 2026 the lease was renewed for a 12 month period expiring May 1, 2027, with a monthly rent of $1,450. For the three months ended June 30, 2026 and 2025, rent expense was $4,300 and $5,200, respectively. For the six months ended June 30, 2026 and 2025, rent expense was $8,500 and $8,800, respectively. For the six months ended June 30, 2026 and 2025, we recorded charges incurred to a company controlled by our chief executive officer for reimbursement of accounting and administrative services provided to us by an employee of that company. For the three months ended June 30, 2026 and 2025, we recorded expense of $41,823 and $34,811, respectively, to this company. For the six months ended June 30, 2026 and 2025, we recorded expense of $81,234 and $69,439, respectively, to this company. At June 30, 2026 and December 31, 2025, we had a payable to the entity of $2,900 and $1,400, respectively. Accrued interest on related-party notes was $1,473,868 and $1,364,032 at June 30, 2026 and December 31, 2025, respectively. During each of the six months ended June 30, 2026 and 2025, we repaid $540 of net working capital advances from related parties. During 2022, an aggregate of 847,262 shares of common stock were borrowed from our chief executive officer to enable conversions of $15,000 of notes and $1,946 of related accrued interest. We have accrued a liability for the shares to be reissued to our chief executive officer in the amount of $11,014, the fair value of the shares on the date of conversion. The replacement shares have not been issued at June 30, 2026. During March 2025, an aggregate of 563,611 shares of common stock were borrowed from our chief executive officer to enable settlements of $10,000 of notes and $2,047 of related accrued interest. We have accrued a liability for the shares to be reissued to our chief executive officer in the amount of $169, the fair value of the shares on the date of conversion. The replacement shares have not been issued at June 30, 2026.

we entered into a 36-month agreement with a company controlled by our chief executive officer for shared use of an office and facilities at $1,000 per month, increasing to $1,200 per month on May 1, 2024 and $1,400 per month on May 1, 2025. On May 1, 2026 the lease was renewed for a 12 month period expiring May 1, 2027, with a monthly rent of $1,450 4300 5200 8500 8800

41823

34811

81234

69439

2900

1400

1473868

1364032

540

847262 15000

1946

11014

563611 10000

2047

169

NOTE 9 – INCOME TAXES There is no provision for income taxes for the six months ended June 30, 2026 because the income for the period results solely from the change in fair value of derivative liabilities, which is a permanent difference and has no effect on income tax expense.

NOTE 9 – SUBSEQUENT EVENTS Authorization of Series E Preferred Stock On July 1, 2026, our board of directors approved the issuance of 150 shares of Series E Preferred Stock with a par value of $0.001. The Preferred Shares have a liquidation value of $10,000 per share and bear an annual cumulative dividend of 8.0%, payable in cash or shares of the company’s common stock. The Preferred Shares will convert into common shares if the Company: executes a power purchase agreement or other commercial contract relating to ocean thermal energy conversion power, desalinated water, cooling, or related infrastructure services; undergoes a change of control; or makes a significant public offering of its shares. The number of common shares issuable upon conversion of each Preferred Share will be based on the volume-weighted average trading price of the Company’s common stock over the ten trading days before the conversion, multiplied by 0.5. After two years, we may redeem the Preferred Shares at any time before they have converted. The Preferred Shares have limited voting rights, generally in connection with authorizing shares senior to the Preferred Shares, changing the terms of the Preferred Shares, redeeming shares, or declaring bankruptcy. Increase in Authorized Shares of Common Stock We currently have 200 million shares of common stock authorized, 190,012,124 of which are currently issued and outstanding, and 9,987,876 of which have been reserved for issuance upon the conversion of convertible debt. As a result, we are unable to issue additional shares to raise capital, to compensate employees or consultants, or upon the exercise of options or warrants, or the conversion of preferred shares or other convertible debt. To rectify this situation, our board of directors approved an amendment to the Company’s articles of incorporation to increase the number of shares of authorized common stock from 200 million to 800 million. To avoid the delays and expenses associated with a stockholders meeting, we sought written consents from some of our larger stockholders to approve the proposed amendment. Currently, we have common and preferred shares outstanding entitled to cast 517,137,12 votes on the amendment. Effective August 13, 2026, 44 stockholders, including the members of our board of directors, cast a total of 260,881,949 votes in favor of the amendment by written consent, approving the amendment under Nevada law and our bylaws. On August 14, 2026, we filed a certificate of amendment to our articles of incorporation with the Nevada Secretary of State effectuating the increase to 800 million shares of authorized common stock. The amendment did not impact the issued and outstanding shares. OCEES Transaction On August 14, 2026, our subsidiary OCEES International, Inc. (“OCEES”) entered into a stock purchase agreement (the “purchase agreement”), with Jeremy P. Feakins, our chief executive officer and chairman of the board. Pursuant to the purchase agreement, OCEES issued 900,000 shares of its common stock to Mr. Feakins, making him the 90% owner of OCEES (we have retained our shares in OCEES, which now equal 10% of OCEES’s outstanding stock). In exchange, Mr. Feakins contributed to OCEES a debt that we owed to JPF Venture Group, Inc., a company owned by Mr. Feakins. This $1.1 million debt was incurred in 2017, was currently in default, and was forgiven in connection with the transaction, significantly improving our balance sheet. Also pursuant to the purchase agreement, OCEES agreed to pay us a royalty equal to one-half of OCEES’s net profits from OTEC power generation, desalinated water production, and cooling operations, including related infrastructure services, power purchase agreements, or other related commercial contracts. On August 25, 2022, OTEC and OCEES entered into a stock purchase agreement with Epaphus Global Energy, LLC, a company owned by Mr. Feakins, pursuant to which OTEC agreed to sell OCEES to Epaphus. Although the 2022 transaction with Epaphus was never consummated, the agreement had not been formally cancelled. In connection with the purchase agreement, the 2022 agreement was rescinded and terminated.

150

0.001

10000

0.080

200000000

190012124

9987876 the number of shares of authorized common stock from 200 million to 800 million. To avoid the delays and expenses associated with a stockholders meeting 517,137,12 260,881,949

800000000

900000

1100000