0001437749-20-019228.txt : 20200902 0001437749-20-019228.hdr.sgml : 20200902 20200902163930 ACCESSION NUMBER: 0001437749-20-019228 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 54 CONFORMED PERIOD OF REPORT: 20200630 FILED AS OF DATE: 20200902 DATE AS OF CHANGE: 20200902 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GB SCIENCES INC CENTRAL INDEX KEY: 0001165320 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 593733133 STATE OF INCORPORATION: NV FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-55462 FILM NUMBER: 201157339 BUSINESS ADDRESS: STREET 1: 6450 CAMERON STREET #110A CITY: LAS VEGAS STATE: NV ZIP: 89118 BUSINESS PHONE: (844) 843-2569 MAIL ADDRESS: STREET 1: 6450 CAMERON STREET #110A CITY: LAS VEGAS STATE: NV ZIP: 89118 FORMER COMPANY: FORMER CONFORMED NAME: Growblox Sciences, Inc. DATE OF NAME CHANGE: 20140603 FORMER COMPANY: FORMER CONFORMED NAME: Signature Exploration & Production Corp. DATE OF NAME CHANGE: 20080602 FORMER COMPANY: FORMER CONFORMED NAME: Diabetic Treatment Centers of America, Inc. DATE OF NAME CHANGE: 20040812 10-Q 1 gblx20200630_10q.htm FORM 10-Q gblx20200630_10q.htm
 

 

Table of Contents

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 June 30, 2020

 

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

 

For the transition period from __________ to ___________

 

Commission file number:   000-55462

 

GB SCIENCES, INC.

(Exact name of registrant as specified in its charter)

 

Nevada

(State or other Jurisdiction of Incorporation or organization)

  

59-3733133

(IRS Employer I.D. No.)

 

3550 W. Teco Avenue

Las Vegas, Nevada 89118

Phone: (866) 721-0297

(Address and telephone number of

principal executive offices)

 

N/A

(Former name, former address and former fiscal year, if changed since last report)

 

Indicate by check mark whether registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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     ☐  No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).   ☒  Yes     ☐  No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the 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 ☐   

Accelerated filer ☐       

Non-accelerated filer ☐

Smaller reporting company  ☒

Emerging growth company  ☐

 

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. ☐

 

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

 

There were 280,532,686 shares of common stock, par value $0.0001 per share, outstanding as of September 1, 2020. 

 

 

 

 
 

 

 

 

PART I. FINANCIAL INFORMATION

 

ITEM 1. Financial Statements (Unaudited)

 

 

 

GB SCIENCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

   

As of June 30,

   

As of March 31,

 
   

2020

   

2020

 

CURRENT ASSETS:

    (unaudited)          

Cash and cash equivalents

  $ 101,230     $ 151,766  

Accounts receivable, net of allowance for doubtful accounts of $126,650 and $130,378 at June 30, 2020 and March 31, 2020, respectively

    192,509       117,967  

Inventory, net

    1,545,891       1,445,839  

Prepaid expenses and other current assets

    57,057       60,885  

Note receivable

    5,224,423       5,224,423  

TOTAL CURRENT ASSETS

    7,121,110       7,000,880  

Property and equipment, net

    5,360,299       5,533,833  

Intangible assets, net of accumulated amortization of $15,344 and $12,287 at June 30, 2020 and March 31, 2020, respectively

    1,776,045       1,699,966  

Deposits and other noncurrent assets

    91,504       91,504  

Operating lease right-of-use assets, net

    24,684       26,685  

TOTAL ASSETS

  $ 14,373,642     $ 14,352,868  

CURRENT LIABILITIES:

               

Accounts payable

  $ 2,712,122     $ 2,559,914  

Accrued interest

    654,760       397,652  

Accrued liabilities

    1,188,938       888,012  

Notes and convertible notes payable and line of credit, net of unamortized discount of $247,695 and $608,580 at June 30, 2020 and March 31, 2020, respectively

    6,327,113       5,534,728  

Indebtedness to related parties

    712,176       586,512  

Note payable to related party

    151,923       151,923  

Income tax payable

    601,822       592,982  

Finance lease obligations, current

    146,211       166,769  

Operating lease obligations, current

    7,579       7,265  

TOTAL CURRENT LIABILITIES

    12,502,644       10,885,757  

Operating lease obligations, long term

    20,499       22,515  

Finance lease obligations, long term

    3,499,612       3,533,090  

TOTAL LIABILITIES

    16,022,755       14,441,362  

Commitments and contingencies (Note 8)

               

STOCKHOLDERS' EQUITY:

               

Common Stock, $0.0001 par value, 600,000,000 shares authorized, 280,532,686 and 275,541,602 outstanding at June 30, 2020 and March 31, 2020, respectively

    28,054       27,554  

Additional paid-in capital

    97,574,001       97,271,157  

Accumulated deficit

    (99,251,168 )     (97,387,205 )

TOTAL EQUITY/(DEFICIT)

    (1,649,113 )     (88,494 )

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)

  $ 14,373,642     $ 14,352,868  

 

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

 

 

 

GB SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

 

   

For the Three Months Ended June 30,

 
                 
   

2020

   

2019

 
                 

Sales revenue

  $ 551,197     $ 910,676  

Cost of goods sold

    (491,795 )     (624,369 )

Gross profit

    59,402       286,307  

General and administrative expenses

    804,708       2,065,549  

LOSS FROM OPERATIONS

    (745,306 )     (1,779,242 )

OTHER EXPENSE

               

Interest expense

    (795,313 )     (437,815 )
Debt default penalty     (286,059 )     -  

Other expense

    (11,182 )     -  

Total other expense

    (1,092,554 )     (437,815 )

LOSS BEFORE INCOME TAXES

    (1,837,860 )     (2,217,057 )

Income tax expense

    (8,840 )     (57,392 )

LOSS FROM CONTINUING OPERATIONS

    (1,846,700 )     (2,274,449 )

Loss from discontinued operations

    -       (264,434 )

NET LOSS

    (1,846,700 )     (2,538,883 )

Net loss attributable to non-controlling interest

    -       (132,216 )

NET LOSS ATTRIBUTABLE TO GB SCIENCES, INC.

  $ (1,846,700 )   $ (2,406,667 )
                 

Net loss attributable to common stockholders of GB Sciences, Inc.

               

Continuing operations

  $ (1,846,700 )   $ (2,274,449 )

Discontinued operations

    -       (132,218 )

Net loss

  $ (1,846,700 )   $ (2,406,667 )
                 

Net loss per common share – basic and diluted

               

Continuing operations

  $ (0.01 )   $ (0.01 )

Discontinued operations

    -       -  

Net loss

  $ (0.01 )   $ (0.01 )
                 

Weighted average common shares outstanding - basic and diluted

    277,968,516       244,036,524  

 

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

 

 

 

GB SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

 

   

Three Months Ended June 30,

 
   

2020

   

2019

 

OPERATING ACTIVITIES:

               

Net loss

  $ (1,846,700 )   $ (2,538,883 )

Loss from discontinued operations

    -       (264,434 )

Net loss from continuing operations

    (1,846,700 )     (2,274,449 )

Adjustments to reconcile net loss to net cash used in operating activities:

               

Depreciation and amortization

    13,028       99,485  

Stock-based compensation

    -       176,402  

Bad debt expense/(recovery)

    (3,728 )     51,344  

Amortization of debt discount and beneficial conversion feature

    510,885       200,382  

Interest expense on conversion of notes payable

    -       17,225  

Default penalty on convertible note payable

    286,059       -  

Changes in operating assets and liabilities:

               

Accounts receivable

    (70,814 )     126,579  

Prepaid expenses and other current assets

    3,828       192,733  

Decrease in deposits and other noncurrent assets

    -       8,762  

Inventory

    64,602       (311,887 )

Accounts payable

    72,280       (222,008 )

Accrued expenses

    264,662       100,887  

Accrued interest

    247,549       86,719  

Income tax payable

    8,840       -  

Indebtedness to related parties

    125,664       -  

Net cash used in operating activities of continuing operations

    (323,845 )     (1,747,826 )

Net cash used in operating activities of discontinued operations

    -       (883,295 )

Net cash used in operating activities

    (323,845 )     (2,631,121 )

INVESTING ACTIVITIES:

               

Purchase of property and equipment

    -       (170,647 )

Acquisition of intangible assets

    -       (39,027 )

Net cash used in investing activities of continuing operations

    -       (209,674 )

Net cash used in investing activities of discontinued operations

    -       (48,000 )

Net cash used in investing activities

    -       (257,674 )

FINANCING ACTIVITIES:

               

Proceeds from issuance of common stock

    -       745,975  

Proceeds from warrant exercises

    151,202       -  

Proceeds from convertible notes payable

    150,000       2,500,000  

Proceeds from line of credit

    5,000       -  
Fees for issuance of convertible note     -       (175,000 )

Brokerage fees for issuance of common stock and warrants

    (15,121 )     (91,104 )

Principal payments on debt and lease obligations

    (17,772 )     (62,641 )

Net cash provided by financing activities of continuing operations

    273,309       2,917,230  

Net cash used in financing activities of discontinued operations

    -       (114,881 )

Net cash provided by financing activities

    273,309       2,802,349  

Net change in cash and cash equivalents

    (50,536 )     (86,446 )

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

    151,766       227,758  

CASH AND CASH EQUIVALENTS AT END OF PERIOD

    101,230       141,312  

Less: cash and cash equivalents classified as discontinued operations

    -       (107,738 )

CASH AND CASH EQUIVALENTS AT END OF PERIOD FROM CONTINUING OPERATIONS

  $ 101,230     $ 33,574  

 

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

 

 

GB SCIENCES, INC.

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

 For the Three Months Ended June 30, 2020 and 2019

(unaudited)

 

   

Three Months Ended June 30,

 
   

2020

   

2019

 
Cash paid for interest   $ -     $ -  
Cash paid for income tax   $ -     $ -  
                 

Non-cash transactions:

               

Depreciation capitalized in inventory

  $ 164,654     $ 148,353  

Property capitalized under operating leases

  $ -     $ 213,218  
Patent filing and drafting costs capitalized in intangible assets   $ 78,226     $ -  
Discount on convertible notes payable attributable to warrant modification   $ 150,000     $ -  
Stock issued upon conversion of long-term note payable   $ -     $ 170,000  

Induced dividend from warrant exercises

  $ 17,263     $ 74,400  

Cumulative effect of the new lease standard

  $ -     $ 7,551  

 

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

 

 

 

GB SCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY/(DEFICIT)

 For the Three Months Ended June 30, 2020 and 2019

(unaudited)

 

   

Shares

   

Amount

   

Additional Paid-In Capital

   

Accumulated Deficit

   

Non-Controlling Interest

   

Total

 

Balance at March 31, 2019

    240,627,102     $ 24,063     $ 93,020,015     $ (84,743,836 )   $ 8,855,757     $ 17,155,999  
                                                 

Issuance of stock for debt conversion

    1,000,000       100       169,900       -       -       170,000  

Exercise of warrants for stock

    1,957,500       196       175,979       -       -       176,175  

Share based compensation expense

    -       -       176,402       -       -       176,402  

Issuance of stock for cash, net of issuance costs

    3,668,167       367       478,329       -       -       478,696  

Exchanged shares issued to consultant for options

    (400,000 )     (40 )     40       -       -       -  

Inducement dividend from warrant exercises

    -       -       74,400       (74,400 )     -       -  

Cumulative effect of the new lease standard

    -       -       -       (7,551 )     -       (7,551 )

Net loss

    -       -       -       (2,406,667 )     -       (2,406,667 )

Loss attributable to non-controlling interest

    -       -       -       -       (132,216 )     (132,216 )

Balance at June 30, 2019

    246,852,769     $ 24,686     $ 94,095,065     $ (87,232,454 )   $ 8,723,541     $ 15,610,838  

 

   

Shares

   

Amount

   

Additional Paid-In Capital

   

Accumulated Deficit

   

Non-Controlling Interest

   

Total

 

Balance at March 31, 2020

    275,541,602     $ 27,554     $ 97,271,157     $ (97,387,205 )   $ -     $ (88,494 )
                                                 

Exercise of warrants for stock, net of issuance costs

    4,991,084       500       135,581       -       -       136,081  
Discount on convertible notes payable attributable to warrant modification     -       -       150,000       -       -       150,000  
Inducement dividend from warrant exercises     -       -       17,263       (17,263 )     -       -  
Net loss     -       -       -       (1,846,700 )     -       (1,846,700 )

Balance at June 30, 2020

    280,532,686     $ 28,054     $ 97,574,001     $ (99,251,168 )   $ -     $ (1,649,113 )

 

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

 

8

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

 

Note 1 – Background and Significant Accounting Policies 

 

GB Sciences, Inc. (“the Company”, “GB Sciences”, “we”, “us”, or “our”) seeks to be a biopharmaceutical research and cannabinoid-based drug development company whose goal is to create patented formulations for safe, standardized, cannabinoid therapies that target a variety of medical conditions in both the pharmaceutical and wellness markets. The Company is engaged in the research and development of cannabinoid medicines and plans to produce cannabinoid therapies for the wellness markets based on its portfolio of intellectual property.

 

Through its wholly owned Canadian subsidiary, GBS Global Biopharma, Inc. (“GBSGB”), the Company is engaged in the research and development of cannabinoid medicines with virtual operations in North America and Europe. GBSGB assets include cannabinoid medicine intellectual property, research contracts and key supplier arrangements. GBSGB’s intellectual property covers a range of conditions and several programs are in pre-clinical animal stage of development; including Parkinson’s disease, neuropathic pain, and cardiovascular therapeutic programs. GBSGB runs a lean drug development program and takes effort to minimize expenses, including personnel, overhead, and fixed capital expenses  through strategic partnerships with Universities and Contract Research Organizations (“CROs”). GBSGB’s intellectual property portfolio includes two issued USPTO Patents, five USPTO patent applications, four provisional USPTO patent applications, and one USPTO application that we anticipate filing by the end of calendar year 2020, as well as licenses for three additional patents covering novel cannabinoid delivery systems. In addition to the USPTO patents and patent applications, the company has filed 28 patent applications internationally.

 

We were incorporated in the State of Delaware on April 4, 2001, under the name “Flagstick Venture, Inc.” On March 28, 2008, stockholders owning a majority of our outstanding common stock approved changing our then name “Signature Exploration and Production Corp.” as our business model had changed.

 

On March 13, 2014, we entered into a definitive assets purchase agreement for the acquisition of assets, including the Growblox™ cultivation technology which resulted in a change in our corporate name on April 4, 2014, from Signature Exploration and Production Corporation to Growblox Sciences, Inc.

 

Effective December 12, 2016, the Company amended its Certificate of Corporation pursuant to shareholder approval as reported in the Form 8-K filed on October 14, 2016.  Pursuant to the amendment the Company’s name was changed from Growblox Sciences, Inc. to GB Sciences, Inc.  

 

Effective April 8, 2018, Shareholders of the Company approved the change in corporate domicile from the State of Delaware to the State of Nevada and increase in the number of authorized capital shares from 250,000,000 to 400,000,000. Effective August 15, 2019, Shareholders of the Company approved an increase in authorized capital shares from 400,000,000 to 600,000,000.

 

Basis of Presentation

 

The accompanying unaudited interim condensed consolidated financial statements of GB Sciences, Inc. (the “Company,” “We” or “Us”) have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulations S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the periods presented are not necessarily indicative of the results that may be expected for the year ending March 31, 2021. The balance sheet at March 31, 2020 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended March 31, 2020.

 

 

9

 

Principles of Consolidation

 

We prepare our consolidated financial statements in accordance with generally accepted accounting principles (GAAP) for the United States of America. Our consolidated financial statements include all operating divisions and majority-owned subsidiaries, reported as a single operating segment, for which we maintain controlling interests. Intercompany accounts and transactions have been eliminated in consolidation. The ownership interest of non-controlling participants in subsidiaries that are not wholly owned is included as a separate component of equity. The non-controlling participants’ share of the net loss is included as “Net loss attributable to non-controlling interest” on the unaudited consolidated statements of operations.

 

Use of Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  The Company regularly evaluates estimates and assumptions related to allowances for doubtful accounts, inventory valuation and standard cost allocations, valuation of initial right-of-use assets and corresponding lease liabilities, valuation of beneficial conversion features in convertible debt, valuation of the assets and liabilities of discontinued operations, stock-based compensation expense, purchased intangible asset valuations, deferred income tax asset valuation allowances, uncertain tax positions, litigation and other loss contingencies.  These estimates and assumptions are based on current facts, historical experience and various other factors that the Company believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of costs and expenses that are not readily apparent from other sources. The actual results the Company experiences may differ materially and adversely from these estimates.

 

Reclassifications

 

Certain reclassifications have been made to the comparative period amounts to conform to the current period presentation. Certain items on the unaudited statements of operations and cash flows have been reclassified to conform with current period presentation. The assets, liabilities, income, and cash flows of GB Sciences Louisiana, LLC have been separated from the comparative period amounts to confirm to the current period presentation as discontinued operations as the result of the sale of the Company’s interest in GB Sciences Louisiana, LLC (Note 10). The reclassifications had no effect on the reported financial position, results of operations or cash flows of the Company.

 

10

 

Discontinued Operations

 

Discontinued operations comprise those activities that were disposed of during the period or which were classified as held for sale at the end of the period and represent a separate major line of business or geographical area that can be clearly distinguished for operational and financial reporting purposes.

 

There were no assets or liabilities of discontinued operations included in the Company's condensed consolidated balance sheets as of June 30, 2020 and March 31, 2020.

 

The revenues and expenses associated with discontinued operations included in our condensed consolidated statements of operations for the three months ended June 30, 2020 and 2019 were as follows:

 

   

For the Three Months Ended June 30,

 
   

2020

   

2019

 
   

Continuing

   

Discontinued

   

Total

   

Continuing

   

Discontinued

   

Total

 

Sales revenue

  $ 551,197     $ -     $ 551,197     $ 910,676     $ -     $ 910,676  

Cost of goods sold

    (491,795 )     -       (491,795 )     (624,369 )     -       (624,369 )

Gross profit

    59,402       -       59,402       286,307       -       286,307  

General and administrative expenses

    804,708       -       804,708       2,065,549       201,840       2,267,389  

LOSS FROM OPERATIONS

    (745,306 )     -       (745,306 )     (1,779,242 )     (201,840 )     (1,981,082 )

OTHER EXPENSE

                                               

Interest expense

    (795,313 )     -       (795,313 )     (437,815 )     (62,594 )     (500,409 )
Debt default penalty     (286,059 )     -       (286,059 )     -       -       -  

Other expense

    (11,182 )     -       (11,182 )     -       -       -  

Total other expense

    (1,092,554 )     -       (1,092,554 )     (437,815 )     (62,594 )     (500,409 )

LOSS BEFORE INCOME TAXES

    (1,837,860 )     -       (1,837,860 )     (2,217,057 )     (264,434 )     (2,481,491 )

Income tax expense

    (8,840 )     -       (8,840 )     (57,392 )     -       (57,392 )

NET LOSS

  $ (1,846,700 )   $ -     $ (1,846,700 )   $ (2,274,449 )   $ (264,434 )   $ (2,538,883 )

 

11

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

Long-Lived Assets

 

Property and equipment comprise a significant portion of our total assets. We evaluate the carrying value of property and equipment if impairment indicators are present or if other circumstances indicate that impairment may exist under authoritative guidance. The annual testing date is March 31. When management believes impairment indicators may exist, projections of the undiscounted future cash flows associated with the use of and eventual disposition of property and equipment are prepared. If the projections indicate that the carrying value of the property and equipment are not recoverable, we reduce the carrying values to fair value. These impairment tests are heavily influenced by assumptions and estimates that are subject to change as additional information becomes available. No indicators of impairment were identified by the Company as of June 30, 2020.

 

Inventory

 

We value our inventory at the lower of the actual cost of our inventory, as determined using the first-in, first-out method, or its current estimated net realizable value. We periodically review our physical inventory for excess, obsolete, and potentially impaired items and reserve accordingly. Our reserve estimate for excess and obsolete inventory is based on expected future use.

 

Beneficial Conversion Feature of Convertible Notes Payable

 

The Company accounts for convertible notes payable in accordance with the guidelines established by the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 470-20, Debt with Conversion and Other Options and Emerging Issues Task Force (“EITF”) 00-27, “Application of Issue No. 98-5 to Certain Convertible Instruments”.  A beneficial conversion feature (“BCF”) exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of any attached equity instruments, if any related equity instruments were granted with the debt. In accordance with this guidance, the BCF of a convertible note is measured by allocating a portion of the note's proceeds to the warrants, if applicable, and as a reduction of the carrying amount of the convertible note equal to the intrinsic value of the conversion feature, both of which are credited to additional paid-in-capital. The Company calculates the fair value of warrants issued with the convertible notes using the Black-Scholes valuation model and uses the same assumptions for valuing any employee options in accordance with ASC Topic 718 Compensation – Stock Compensation. The only difference is that the contractual life of the warrants is used.

 

The value of the proceeds received from a convertible note is then allocated between the conversion features and warrants on a relative fair value basis. The allocated fair value is recorded in the financial statements as a debt discount (premium) from the face amount of the note and such discount is amortized over the expected term of the convertible note (or to the conversion date of the note, if sooner) and is charged to interest expense.

 

Revenue Recognition

 

The FASB issued Accounting Standards Codification (“ASC”) 606 as guidance on the recognition of revenue from contracts with customers. Revenue recognition depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). The Company adopted the guidance on April 1, 2018 and applied the cumulative catch-up transition method.

 

The Company’s only current revenue source is from sales of cannabis, a distinct physical good. Under ASC 606, the Company is required to separately identify each performance obligation resulting from its contracts from customers, which may be a good or a service. A contract may contain one or more performance obligations. All of the Company’s contracts with customers, past and present, contain only a single performance obligation, the delivery of distinct physical goods. Because fulfillment of the company’s performance obligation to the customer under ASC 606 results in the same timing of revenue recognition as under the previous guidance (i.e. revenue is recognized upon delivery of physical goods), the Company did not record any material adjustment to report the cumulative effect of initial application of the guidance.

 

12

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

Earnings/(loss) per Share 

 

The Company’s basic loss per share has been calculated using the weighted average number of common shares outstanding during the period. The Company had 153,412,936 and 158,404,020 potentially dilutive common shares at June 30, 2020 and March 31, 2020, respectively. However, such common stock equivalents were not included in the computation of diluted net loss per share as their inclusion would have been anti-dilutive.

 

Recent Accounting Pronouncements

 

Recently Adopted Standards

 

In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-13, "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" ("ASU 2016-13").  Financial Instruments—Credit Losses (Topic 326) amends guideline on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities.  For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses.  The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected.  For available-for-sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write-down.  ASU 2016-13 affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income.  The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash.  The amendments in this ASU are effective for smaller reporting companies for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on its financial statements.

 

In August 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement.” This ASU eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. The standard is effective for all entities for financial statements issued for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Company adopted the standard on April 1, 2020. The adoption of this guidance did not have a material impact on the Company’s financial statements.

 

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

 

13

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

 

Note 2 – Going Concern

 

The Company’s financial statements have been prepared assuming the Company will continue as a going concern. The Company has sustained net losses since inception, which have caused an accumulated deficit of $(99,251,168) at June 30, 2020. The Company had a working capital deficit of $(5,381,534) at June 30, 2020, compared to $(3,884,877) at March 31, 2020. In addition, the Company has consumed cash in its operating activities of $(323,845) for the three months ended June 30, 2020, compared to $(2,631,121) including $(883,295) from discontinued operations for the three months ended June 30, 2019. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.

 

Management has been able, thus far, to finance the losses through a public offering, private placements and obtaining operating funds from stockholders. The Company is continuing to seek sources of financing.  There are no assurances that the Company will be successful in achieving its goals.

 

In view of these conditions, the Company’s ability to continue as a going concern is dependent upon its ability to obtain additional financing or capital sources, to meet its financing requirements, and ultimately to achieve profitable operations. Management believes that its current and future plans provide an opportunity to continue as a going concern. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that may be necessary in the event the Company is unable to continue as a going concern.

 

 

 

Note 3 – Inventory

 

Raw materials consist of supplies, materials, and consumables used in the cultivation and extraction processes. Work-in-progress includes live plants and cannabis in the drying, curing, and trimming processes. Finished goods includes completed cannabis flower, trim, and extracts in bulk and packaged forms.

 

   

June 30, 2020

   

March 31, 2020

 
                 

Raw materials

  $ 129,133     $ 91,465  

Work in progress

    923,737     $ 1,166,511  

Finished goods

    619,491     $ 466,319  

Subtotal

    1,672,361       1,724,295  

Allowance to reduce inventory to net realizable value

    (126,470 )     (278,456 )

Total inventory, net

  $ 1,545,891     $ 1,445,839  

 

 

 

Note 4 – Leases

 

The Company determines if an arrangement is a lease at inception and has lease agreements for warehouses, office facilities, and equipment. These commitments have remaining non-cancelable lease terms, with lease expirations which range from 2024 to 2025.

 

As a result of the adoption of ASC 842, certain real estate and equipment operating leases have been recorded on the balance sheet with a lease liability and right-of-use asset ("ROU"). Application of this standard resulted in the recognition of ROU assets of $182,624, net of accumulated amortization, and a corresponding lease liability of $190,173 at the April 1, 2019, the date of adoption. Accounting for finance leases is substantially unchanged.

 

14

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

Operating leases are included in other current assets , accrued liabilities, and operating lease obligations, long term on the unaudited condensed consolidated balance sheets. Finance leases are included in property and equipment, finance lease obligations, short term, and finance lease obligations, long term, on the unaudited condensed consolidated balance sheets. ROU assets represent the Company's right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make scheduled lease payments. ROU assets and liabilities are recognized on the lease commencement date based on the present value of lease payments over the lease term. The present value of lease payments is calculated using the incremental borrowing rate at lease commencement, which takes into consideration recent debt issuances as well as other applicable market data available. The rates used to discount finance leases previously recorded as capital leases range from 10.2% to 11.5%. Operating leases were discounted at a rate of 17.0%.

 

Lease terms include options to extend when it is reasonably certain that the option will be exercised. Leases with a term of 12 months or less are not recorded on the consolidated balance sheet.

 

During the three months ended June 30, 2020, finance lease costs recorded in the consolidated financial statements were $143,599, of which $104,924 represents interest expense and $38,675 represents amortization of the right-of-use assets. Operating lease costs were $3,243, of which $1,242 represents interest expense and $2,001 represents amortization of the right-of-use assets.

  

Amortization of lease assets is included in general and administrative expenses. The future minimum lease payments of lease liabilities as of June 30, 2020, from continuing operations are as follows:

 

Year Ending

         

Operating

 

March 31,

 

Finance Leases

   

Leases

 
                 

2021 (9 months)

  $ 422,801     $ 8,836  

2022

    544,296       11,779  

2023

    560,625       11,779  

2024

    577,444       3,926  

2025

    594,767       -  

Thereafter

    3,781,101       -  

Total minimum lease payments

    6,481,034       36,320  

Less: Amount representing interest

    (2,835,211 )     (8,242 )

Present value of minimum lease payments

    3,645,823       28,078  

Less: Current maturities of capital lease obligations

    (146,211 )     (7,579 )

Long-term capital lease obligations

  $ 3,499,612     $ 20,499  

 

 

15

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

 

Note 5 – Notes Payable and Line of Credit

 

0% Note Payable dated October 23, 2017

 

On October 23, 2017, the Company amended the existing Nevada Medical Marijuana Production License Agreement (“Amended Production License Agreement”). Per the terms of the Amended Production License Agreement, GB Sciences purchased the remaining percentage of the production license resulting in the 100% ownership of the license. GB Sciences also received 100% ownership of the cultivation license included in the original Nevada Medical Marijuana Production License Agreement. In exchange, GB Sciences made one-time payment of $500,000 and issued a 0% Promissory Note in the amount of $700,000 payable in equal monthly payments over a three-year period commencing on January 1, 2018.

 

The present value of the note was $521,067 on the date of its issuance based on an imputed interest rate of 20.3% and the Company recorded a discount on notes payable of $178,933. During the three months ended June 30, 2020, the Company recorded interest expense of $7,321 related to amortization of the note discount. The remaining unamortized discount as of June 30, 2020 was $(6,607).

 

The Company has been in default on this note since June of 2019, and as of the date of this report, fifteen monthly payments on the note totaling $291,660 are unpaid. As the result of the default, the Company has accrued penalty interest at the rate of 10% according to the terms of the Promissory Note. Total penalty interest accrued was $9,236 for the three months ended June 30, 2020. If the Company is unable to cure the default within ten days of receiving a written notice, the lender will have the option to accelerate the remaining balance owed of $369,445, but must notify the Company in writing should it choose to do so. The Company is currently in the process of negotiating a settlement and/or forbearance agreement with the lender and anticipates repayment of the note upon receiving proceeds from the sales of the Company's Teco and Nopah facilities (Note 11).

 

8% Line of Credit dated November 27, 2019

 

In connection with the Binding Letter of Intent dated November 27, 2019 (Note 11), the Company entered into a promissory note and received a line of credit for up to $470,000 from the purchaser of the Company's membership interest in its Nevada facilities. The purpose of the line of credit is to supply working capital for the Nevada operations. The note matures upon the close of the sale of membership interests. As of June 30, 2020, the Company has received $485,000 in advances under the line of credit, reflecting an informal agreement with the lender to increase the Line of Credit limit by $15,000. The Company accrued interest of $9,641 on the line of credit for the three months ended June 30, 2020, and the balance of the line of credit was $485,000 at June 30, 2020. Upon the close of the sale of the Teco Facility all principal and interest due under the line of credit will be considered satisfied in full.

 

8% Note Payable dated May 7, 2020

 

On May 7, 2020, the Company received $135,000 cash from an investor, net of $(15,000) in brokerage fees, and issued a $150,000 promissory note. The note bears interest at a rate of 8.0% per annum. The note is to be repaid upon the first proceeds received from the $8,000,000 promissory note related to the sale of the Company's membership interest in GB Sciences Louisiana, LLC (Note 10), or from the proceeds of the sale of the Teco Facility (Note 11). As inducement to enter into the note transaction, the Company repriced 8,002,500 preexisting warrants held by the investor to an exercise price of $0.04. The repriced warrants were valued at $272,085 on the date of the transaction using the Black-Scholes Model, which exceeded the value of the warrants prior to the price reduction of $49,525 by $222,560. As the result of the increase in the estimated fair value of the warrants, the Company recorded a full discount on notes payable of $(150,000). During the three months ended June 30, 2020, the Company recorded interest expense of $151,742 related to the note consisting of accrued interest of $1,742 and $150,000 related to amortization of the note discount. Unamortized discount remaining at June 30, 2020 was $0.

 

16

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

Summary of Notes Payable

 

As of June 30, 2020, the following notes payable were recorded in the Company’s consolidated balance sheet:

 

   

As of June 30, 2020

 

Short-Term Notes Payable

 

Face Value

   

Discount

   

Carrying Value

 

6% Convertible promissory notes payable (Note 6)

  $ 1,257,000     $ (58,812 )   $ 1,198,188  

8% Convertible Secured Promissory Note dated February 28, 2019, as amended (Note 6)

    1,271,863       (182,276 )     1,089,587  

8% Convertible Promissory Note dated April 23, 2019 (Note 6)

    3,041,500       -       3,041,500  

0% Note Payable dated October 23, 2017 (Note 5)

    369,445       (6,607 )     362,838  

8% Line of Credit dated November 27, 2019 (Note 5)

    485,000       -       485,000  

8% Note Payable dated May 7, 2020 (Note 5)

    150,000       -       150,000  

Total Short-Term Notes Payable

  $ 6,574,808     $ (247,695 )   $ 6,327,113  

 

 

 

Note 6 – Convertible Notes

 

March 2017 $2M Convertible Note Offering

 

In March 2017, the Company entered into a Placement Agent’s Agreement with a third-party brokerage firm to offer units consisting of a $1,000 6% promissory note convertible into 4,000 shares of the Company’s common stock at $0.25 per share and 4,000 warrants to purchase shares of the Company’s’ common stock at an exercise price of $0.60 per share for the period of three years. Between March 2017 and May 2017, the Company issued short-term Promissory Notes (“Notes”) to various holders with combined face value of $2,000,000. The Notes are payable within three years of issuance and are convertible into 8,000,000 shares of the Company’s common stock. The Company also issued 8,000,000 common stock warrants to the Noteholders. The warrants are exercisable at any time and from time to time before maturity at the option of the holder. Each warrant gives the Noteholder the right to purchase one share of common stock of the Company at an exercise price of $0.60 per share for a period of three years.  The Company recorded an aggregate discount on convertible notes of $1,933,693, which included $904,690 related to the relative fair value of beneficial conversion features and $1,029,003 for the relative fair value of the warrants issued with each note. The fair value of warrants was derived using the Black-Scholes valuation model.

 

July 2017 $7.2M Convertible Note Offering

 

In July, 2017, the Company entered into a Placement Agent’s Agreement with a third-party brokerage firm to offer units consisting of a $1,000 6% promissory note convertible into 4,000 shares of the Company’s common stock at $0.25 per share and 4,000 warrants to purchase shares of the Company’s’ common stock at an exercise price of $0.65 per share for the period of three years. Between July 2017 and December 2017, the Company issued short-term Promissory Notes (“Notes”) to various holders with combined face value of $7,201,000. The Notes are payable within three years of issuance and are convertible into 28,804,000 shares of the Company’s common stock. The Company also issued 28,804,000 common stock warrants to the Noteholders. The warrants are exercisable at any time and from time to time before maturity at the option of the holder. Each warrant gives the Noteholder the right to purchase one share of common stock of the Company at an exercise price of $0.60 per share for a period of three years.The Company recorded an aggregate discount on convertible notes of $7,092,796, which included $3,142,605 related to the relative fair value of beneficial conversion features and 3,950,191 for the relative fair value of the warrants issued with each note. The fair value of warrants was derived using the Black-Scholes valuation model.

 

As of June 30, 2020, convertible notes having a carrying value of $ 1,198,188, net of unamortized discount of $ (58,812) remained outstanding from the March 2017 and July 2017 note offerings, and accrued interest on the notes is $228,052. Discount amortization was $96,527 for the three months ended June 30, 2020.

 

17

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

8% Senior Secured Convertible Promissory Note dated February 28, 2019

 

On February 28, 2019, the Company issued a $1,500,000 8% Senior Secured Convertible Promissory Note and entered into the Note Purchase Agreement and Security Agreement with CSW Ventures, L.P. (together, “CSW Note”). The note matures on August 28, 2020 and is convertible at any time until maturity into 8,823,529 shares of the Company’s common stock at $0.17 per share. Collateral pledged as security for the note includes all of the Company’s 100% membership interests in GB Sciences, Nevada, LLC and GB Sciences Las Vegas, LLC, which together represent substantially all of the Company’s cannabis cultivation and production operations and assets located at the Teco facility in Las Vegas, Nevada. The intrinsic value of the beneficial conversion feature resulting from the market price of the Company’s common stock in excess of the conversion price was $176,471 on the date of issuance, and the Company recorded a discount on the CSW Note in that amount.

 

On May 28, 2019, the Company received notice from CSW Ventures, L.P. of the conversion of a total of $170,000 of the principal balance of the 8% Senior Secured Promissory Note dated February 28, 2019. Accordingly, the Company issued 1,000,000 shares of its common stock based on a $0.17 per share conversion price. In connection with the conversions, $ 17,225 in unamortized discount was recorded as interest expense and the Company reduced the carrying amount of convertible notes payable by $152,775. After conversion, the remaining balance outstanding was $1,330,000.

 

On July 12, 2019, the Company entered into the Amendment to Note Documents and the Amended and Restated 8% Senior Secured Promissory Note (together, “Amended CSW Note”). The Amended CSW Note increased the note balance by $100,000 to reflect an additional $100,000 advanced to the Company on July 12, 2019, by $41,863 to add accrued interest to date to the principal balance, and decreased the conversion price to $0.11 per share, with the remaining terms substantially unchanged from the original CSW Note.

 

We evaluated the modification under the guidance in ASC 470-50 and determined that the amendment represents an extinguishment because the change in the fair value of the conversion feature exceeded 10% of the carrying value of the CSW Note on the amendment date. The carrying value of the amended note on the date of extinguishment was $1,338,057, net of a beneficial conversion feature discount of $133,806, and we recorded a loss on extinguishment of $124,158.

 

On August 1, 2019, the Company received notice from CSW Ventures, L.P. of the conversion of a total of $ 110,000 of the principal balance of the Amended CSW Note at $0.11 per share. Accordingly, the Company issued 1,000,000 shares of its common stock. In connection with the conversions, $9,579 in unamortized discount was recorded as interest expense and the Company has reduced the carrying amount of convertible notes payable by $100,421. After conversion, the remaining balance outstanding was $ 1,361,863.

 

On October 23, 2019, the Company entered into the Amendment to Promissory Note. The October 23, 2019 amendment decreased the conversion price to $0.08 per share, with the remaining terms substantially unchanged from the Amended CSW Note.

 

We evaluated the modification under the guidance in ASC 470-50 and determined that the amendment represents an extinguishment because the change in the fair value of the conversion feature exceeded 10% of the carrying value of the Amended CSW Note immediately prior to the 2nd Amended CSW Note. The carrying value of the Amended CSW Note on the date of extinguishment was $1,269,067, net of a beneficial conversion feature discount of $92,796, and we recorded a loss on extinguishment of $92,796.

 

On November 27, 2019, the Company entered into the Second Amendment to Note Documents and the Second Amended and Restated 8% Senior Secured Promissory Note (together, “2nd Amended CSW Note”). The 2nd Amended CSW Note decreased the conversion price to $0.04 per share and increased the note balance by $30,000 to reflect an advance received on that date, with the remaining terms substantially unchanged from the Amended CSW Note.

 

18

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

 We evaluated the modification under the guidance in ASC 470-50 and determined that the 2nd Amended CSW Note represents an extinguishment because the change in the fair value of the conversion feature exceeded 10% of the carrying value of the Amended CSW Note immediately prior to the 2nd Amended CSW Note; however, no loss on extinguishment was recorded because the net consideration paid for the 2nd Amended CSW Note was equal to the extinguished carrying value of the Amended CSW Note. The carrying value of the Amended CSW Note on the date of extinguishment was $1,361,863.

 

On December 16, 2019, the Company received notice from CSW Ventures, L.P. of the conversion of a total of $120,000 of the principal balance of the Amended CSW Note at $0.04 per share and we issued 3,000,000 shares of common stock. In connection with the conversions, $57,551 in unamortized discount was recorded as interest expense, and the Company has reduced the carrying amount of convertible notes payable by $62,449. After conversion, the remaining balance outstanding was $1,271,863 and the carrying amount of the note was $687,021, net of $584,842 in unamortized discount from the beneficial conversion feature.

 

During the three months ended June 30, 2020, we recorded interest expense of $252,573 related to the CSW Note and its amendments consisting of $25,367 in accrued interest and $227,206 related to amortization of the note discount. As of June 30, 2020, the carrying amount of the CSW Note was $1,089,587, net of unamortized discount of $(182,276).

 

The Company is in default on the amended CSW Note due to non-payment of the quarterly interest payments due on October 1, 2019, January 1, 2020,  March 1, 2020, and June 1, 2020, and for nonpayment of an income tax liability related to the March 31, 2018 tax year. The terms of the note provide that the Company has 5 days to cure a default caused by nonpayment of interest and ten days to cure a default caused by noncompliance with affirmative or negative debt covenants. The lender has agreed to provide forbearance of the defaults in connection with the sale of the Teco facilities, and the Company anticipates that the CSW Note will be settled in full upon close of the sale of the Company's interests in its Nevada operations to an entity affiliated with CSW Ventures, L.P. (Note 11).

 

8% Convertible Promissory Note dated April 23, 2019

 

On April 23, 2019, the Company entered into the Note Purchase Agreement with Iliad Research and Trading, L.P. ("Iliad") and issued an 8% Convertible Promissory Note with a face value of $2,765,000. The Note was issued with original issue discount of $265,000 and is convertible into shares of the Company’s common stock at a price of $0.17 per share at the option of the note holder at any time until the Note is repaid. The Note matures on April 22, 2020. A total discount of $440,000 was recorded on the note, which includes $265,000 of original issue discount and $175,000 in fees paid to brokers.

 

During the year ended March 31, 2020, the Company honored the conversion of a total of a total of $125,000 of accrued interest on the Iliad Note at reduced conversion rates. On October 30, 2019, the Company received notice of the conversion of $75,000 at $0.06 per share and issued 1,250,000 shares of its common stock. The fair value of the shares issued exceeded the fair value of the shares issuable under the original terms of the Note by $64,706, and the Company recorded an induced conversion expense. On November 18, 2019, the Company received notice of the conversion of $50,000 of the note balance at $0.0375 per share and issued 1,333,333 shares of its common stock.

 

19

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

On April 22, 2020, the Company failed to make payment of the principal and accrued interest due under the Iliad Note, resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by 10%. As the result of the default, Company recorded an expense of $9,559 related to a 10% increase in the accrued interest balance, which is recorded in interest expense, and $276,500 related to the 10% increase in the principal balance, which is recorded in debt default penalty and other expense. As of June 30, 2020, the principal balance due under the note was $3,041,500, including the 10% penalty increase to the principal balance, and accrued interest was $192,649, including an increase of $9,559 attributable to the 10% default penalty.

 

During the three months ended June 30, 2020, interest expense related to the note was $130,659, of which $29,831 was amortization of the note discount and $100,828 was interest accrued at the pre-default rate of 8.0% through April 22, 2020, and at the default rate of 15.0% for the period from April 23, 2020 through June 30, 2020.

 

On May 20, 2020, Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does not intend to defend the lawsuit. On July 14, 2020, the Court entered judgment in favor of Iliad in the amount of $3,264,594 and the judgment accrues interest at the default rate of 15% per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has not been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC. 

 

 

Note 7 – Capital Transactions

 

Sale of Common Stock and Exercise of Warrants

 

On April 1, 2020, the Company entered into the Advisory Agreement with its brokers and effected a temporary decrease in the exercise price of the Company's outstanding warrants to $0.03-$.05 per share. As a result of the price reduction, the Company received notice of the exercise of 4,991,084 warrants during the three months ended June 30, 2020 and received proceeds of $136,081, net of brokerage fees of $(15,121).

 

At June 30, 2020, 79,547,077 warrants at exercise prices ranging from $0.25 to $1.00 per share and 13,366,334 options with a weighted average exercise price of $0.28 were outstanding.

 

20

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

 

Note 8 – Commitments and Contingencies

 

On September 18, 2017 GB Sciences finalized its agreement with Louisiana State University (“LSU”) AgCenter to be the sole operator of the LSU’s medical marijuana program. The LSU Board of Supervisors entered into a five-year agreement that has an option to renew for two additional five-year terms with GB Sciences.

 

The contract includes the Company’s commitment to make an annual research investments of $500,000 to the LSU AgCenter. The Company retained its 50% interest in the research relationship with LSU after the sale of its membership interest in GB Sciences Louisiana, LLC (Note 10), and accordingly remains obligated for $250,000 of the $500,000 annual research investment for three years, or a total commitment of $750,000. The research investment is paid annually in September and amortized over a one-year period. On August 4, 2020, the Company received its first payment under the Wellcana Note Receivable, net of the $250,000 research contribution due for the twelve month period ended September 30, 2020, and our commitment for that twelve month period was paid by the purchaser with the funds withheld from the note payment. The monetary contributions will be used to conduct research on plant varieties, compounds, extraction techniques and delivery methods that could generate additional revenue through discoveries that are subject to intellectual property rights, of which AgCenter would retain 50% of those rights with the other 50% retained 25% each by the Company and by GB Sciences Louisiana, LLC.

 

On August 24, 2020, the Company entered into a letter of intent with the purchaser to discount the note receivable in exchange for accelerated payment. Pursuant to the letter of intent, the purchaser will assume the annual $250,000 research contribution commitment to LSU and the Company will retain no rights in the intellectual property developed under the research relationship (Note 10).

 

Tara “Dee” Russell filed a Charge of Discrimination with the Nevada Equal Rights Commission ("NERC") against the Company on April 2, 2019, alleging that she was subjected to sexual harassment and retaliatory discharge. The Company received the Notice of Charge of Discrimination on or about May 15, 2019. The Company submitted its response to the Notice of Discrimination Charge on July 26, 2019. It is the Company's position that Ms. Russel was not an employee of the Company, but rather was an independent contractor. The Company intends to aggressively respond to the charge. To date, the NERC has not issued a ruling regarding the charge.

 

On April 22, 2020, the Company failed to repay any of the outstanding balance of the Convertible Promissory Note Payable to Iliad Research and Trading, L.P. (Note 6), resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by 10% and the Company recorded expense of $286,059 related to the default. As of June 30, 2020, the total balance due under the note was $3,234,149 including accrued interest of $192,649.

 

On May 20, 2020, Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does not intend to defend the lawsuit. On July 14, 2020, the Court entered judgment in favor of Iliad in the amount of $3,264,594 and the judgment accrues interest at the default rate of 15% per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has not been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC. 

 

On April 22, 2020, the Company was served notice of a lawsuit filed in the Eighth Judicial District Court in Clark County, Nevada, filed by a contractor who had been hired to perform architectural and design services. The lawsuit demands payment of $73,050 for the services provided. The Company intends to negotiate a settlement and the full amount demanded in the lawsuit of $73,050 is accrued in accounts payable as of June 30, 2020.

 

21

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

From time to time, the Company may become involved in certain legal proceedings and claims which arise in the ordinary course of business. In management’s opinion, based on consultations with outside counsel, the results of any of these ordinary course matters, individually and in the aggregate, are not expected to have a material effect on our results of operations, financial condition, or cash flows. As more information becomes available, if management should determine that an unfavorable outcome is probable on such a claim and that the amount of such probable loss that it will incur on that claim is reasonably estimable, the Company would record a reserve for the claim in question. If and when the Company records such a reserve, it could be material and could adversely impact its results of operations, financial condition, and cash flows.

 

 

Note 9 – Related Party Transactions

 

As of June 30, 2020 the Company is indebted to its officers and directors for a total of $712,176, consisting of $447,633 in unpaid wages, $109,087 in directors’ compensation, $84,497 in unpaid bonuses, and $70,959 in reimbursements for business expenses.

 

In connection with the sale of membership interest in GB Sciences Louisiana, LLC, the Company issued a note payable in the amount of $151,923 to John Davis, the Company's former General Counsel and President of GB Sciences Louisiana, LLC, for unpaid fees and bonuses. The note matures upon receipt of the first payment from the Wellcana Note Receivable (Note 10). The note and interest accrued was repaid on August 4, 2020, when the related funds were withheld from the first payment to the Company under the Wellcana Note Receivable (Note 12).

 

 

Note 10 – Sale of Membership Interests in GB Sciences Louisiana, LLC

 

On February 12, 2018, the Company’s wholly-owned subsidiary, GB Sciences Louisiana, LLC (“GBSLA"), issued members’ equity interests equal to 15% in GBSLA to Wellcana Group, LLC (“Wellcana”) for $3 million. Under the GBSLA operating agreement, Wellcana had an option to make additional capital contributions for the purchase of up to an additional 35% membership interest in GBSLA, at the rate of 5% membership interest per $1 million contributed. To date, Wellcana has made additional cash contributions of $7.0 million and its non-controlling interest in GBSLA increased to 49.99%. The capital contributions were used to fund the buildout of the Petroleum Drive facility and to pay for the operating costs of GBSLA.

 

On November 15, 2019, the Company entered into the Membership Interest Purchase Agreement ("MIPA") with Wellcana Plus, LLC ("Purchaser"), an affiliate of Wellcana Group, LLC. In consideration for the sale of its remaining 50.01% membership interest in GBSLA, the Company received the $8,000,000 Promissory Note  ("Wellcana Note") and may receive up to an additional $8,000,000 in earn-out payments.

 

On August 24, 2020, the Company entered into a letter of intent with Wellcana to discount the note receivable in exchange for accelerated payment. Pursuant to the letter of intent, the Company will receive payments totaling $5,224,423, including the forgiveness by Wellcana of $324,423 in liabilities and the payment of $4,900,000 in cash, on or before October 15, 2020, less any cash payments made by Wellcana up to the date of the final payment. Upon receipt of the payment, all liabilities owed to the Company by Wellcana, including the $8,000,000 note receivable and any potential earn-out payments will be considered satisfied in full. Wellcana will assume the annual $250,000 research contribution commitment to LSU (Note 8) and the Company will retain no rights in the intellectual property developed under the research relationship. In addition, the Company agreed to reduce the $750,000 note payment due on September 1, 2020 to $500,000. Should Wellcana fail to make the $4,900,000 payment, less any offsets from payments made to date on the note receivable, the term sheet will be void and the original terms of the Membership Interest Purchase Agreement and $8,000,000 note receivable will prevail.

 

As a result of the August 24, 2020 letter of intent, the Company determined that the amount of the note that was collectible as of March 31, 2020 was $5,224,423 and recorded a loss on modification of note receivable of $1,895,434 for the year ended March 31, 2020. As of June 30, 2020, the balance of the note receivable was $5,224,423.

 

The Company granted forbearance of the June 1, 2020 payment from Wellcana in light of the circumstances created by the COVID-19 epidemic. The payment was received by the Company on August 4, 2020, net of the Company's $250,000 research contribution commitment to LSU for the twelve months ended September 2020 (Note 8) and the principal and accrued interest payable to John Davis (Note 5) totaling $189,423 as of the date of payment.

 

For all periods presented in the unaudited financial statements, the assets, liabilities, income, and cash flows of GBSLA have been reclassified to discontinued operations.

 

22

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

 

Note 11 – Sale of Membership Interests in Nevada Subsidiaries

 

On November 15, 2019, we entered into a Binding Letter of Intent ("Teco LOI") to sell 75% of the Company's membership interest interests in GB Sciences Nevada, LLC, and GB Sciences Las Vegas, LLC, for $3.0 million cash upon close and up to an additional $3.0 million in earn-out payments after close. In connection with the Teco LOI, we entered into a Management Agreement with the purchaser whereby the facilities will be managed by an affiliate of the purchaser until the close of the sale. As part of the transaction, the Company also entered into a Line of Credit of up to $470,000 with the purchaser (Note 5) to fund the operations of Teco. The line of credit accrues interest at a rate of 8% and the Company pledged its interest in the Teco facilities as collateral for the note, subject to the preexisting lien held by CSW Ventures, L.P. in connection with the 8% Senior Secured Convertible Promissory Note dated February 28, 2019 (Note 6). The Line of Credit will be considered satisfied in full upon close of the sale of the Teco Facility.

 

On March 24, 2020, we entered into the Membership Interest Purchase Agreement ("Teco MIPA") which formalized the sale of the Teco Subsidiaries and modified the terms of the sale. Pursuant to the Teco MIPA, the Company will sell 100% of its membership interests in GBSN and GBLV for $4,000,000 cash upon close and will receive a $4,000,000 8% promissory note to be paid in monthly installments over 36 months.

 

On July 24, 2020, the Company entered into the Loan Agreement, 8% Secured Promissory Note, and Security Agreement (together, the "July 24 Note") with AJE Management, LLC, which established a revolving loan of up to $500,000 that the Company may draw on from time to time. The loan is collateralized by the Teco Facility, subject to the preexisting lien held by CSW Ventures, L.P. in connection with the 8% Senior Secured Convertible Promissory Note dated February 28, 2019 (Note 6). Any advances will be made at the sole discretion of the lender following a written request made by the Company. Contemporaneously with the Loan Agreement, the Company and AJE Management entered into the Amendment to the Membership Interest Purchase Agreement with AJE Management. The amendment provides that any balances outstanding under the July 24 Note at the time of the close of the sale of the Teco Facility will be forgiven in exchange for a reduction to the $4,000,000 note receivable that the Company will receive as consideration for the sale of the Teco Facility. The reduction to the note receivable will be equal to 3 times the balance outstanding under the July 24 Note on the date of the close of the sale of the Teco Facility. As of the date of this report, the Company has not received any advances under the July 24 Note.

 

The sale is expected to close upon the successful transfer of the Nevada cultivation and production licenses. The transfer of cannabis licenses in the State of Nevada has been subject to an indefinite moratorium since October 2019. In a meeting held on July 21, 2020, the Nevada Cannabis Compliance Board lifted the moratorium, however, the board has indicated that there are over 90 requests pending and it will take up to several months to process the entire backlog of pending license transfers. Based on this information, we cannot provide any assurances as to the timing of the close of the sale. The lifting of the moratorium and processing of cannabis license transfers have been delayed by the COVID-19 pandemic and could be further delayed if the pandemic continues.

 

The Company also holds a Nevada license for cultivation of medical marijuana located in Sandy Valley, Nevada (the “Nopah License”). The license is owned by the Company’s wholly owned subsidiary, GB Sciences Nopah, LLC ("Nopah"). Operations have not begun under the Nopah License. On November 27, 2019, the Company entered into a Binding Letter of Intent to sell its 100% interest in GB Sciences Nopah, LLC (the “Nopah LOI”), with the transaction closing upon transfer of the Nopah License. As consideration for the transfer of the license, the Company will receive $300,000 and the purchaser will pay all expenses related to the upkeep and maintenence of the Nopah License. The transfer of the Nopah License is subject to the same restrictions on license transfers discussed above.

 

 

Note 12 – Subsequent Events

 

Capital Transactions

 

On July 24, 2020, the Company entered into the Loan Agreement, 8% Secured Promissory Note, and Security Agreement (together, the "July 24 Note") with AJE Management, LLC, which established a revolving loan of up to $500,000 that the Company may draw on from time to time. The loan is collateralized by the Teco Facility, subject to the pre-existing lien held by CSW Ventures, L.P. in connection with the 8% Senior Secured Convertible Promissory Note dated February 28, 2019 (Note 6). Any advances will be made at the sole discretion of the lender following a written request made by the Company. Contemporaneously with the Loan Agreement, the Company and AJE Management entered into the Amendment to the Membership Interest Purchase Agreement with AJE Management. The amendment provides that any balances outstanding under the July 24 Note at the time of the close of the sale of the Teco Facility will be forgiven in exchange for a reduction to the $4,000,000 note receivable that the Company will receive as consideration for the sale of the Teco Facility (Note 11). The reduction to the note receivable will be equal to 3 times the balance outstanding under the July 24 Note on the date of the close of the sale of the Teco Facility. As of the date of this report, the Company has not received any advances under the July 24 Note.

 

23

GB SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2020
(unaudited)

 

 Note Receivable

 

The Company granted forbearance of the June 1, 2020 payment to Wellcana in light of the circumstances created by the COVID-19 epidemic. The payment was received by the Company on August 4, 2020, net of the Company's annual $250,000 research contribution commitment to LSU (Note 10) and the principal and accrued interest payable to John Davis (Note 5) totaling $189,423 as of the date of payment.

 

On August 24, 2020, the Company entered into a letter of intent with Wellcana to discount the note receivable in exchange for accelerated payment. Pursuant to the letter of intent, the Company will receive payments totaling $5,224,423, including the forgiveness by Wellcana of $324,423 in liabilities and the payment of $4,900,000 in cash, on or before October 15, 2020, less any cash payments made by Wellcana up to the date of the final payment. Upon receipt of the payment, all liabilities owed to the Company by Wellcana, including the $8,000,000 note receivable and any potential earn-out payments will be considered satisfied in full. Wellcana will assume the annual $250,000 research contribution commitment to LSU (Note 10) and the Company will retain no rights in the intellectual property developed under the research relationship. In addition, the Company agreed to reduce the $750,000 note payment due on September 1, 2020 to $500,000. Should Wellcana fail to make the $4,900,000 payment, less any offsets from payments made to date on the note receivable, the term sheet will be void and the original terms of the Membership Interest Purchase Agreement and $8,000,000 note receivable will prevail.

 

On August 31, 2020, the Company granted a 30-day forbearance of the $500,000 payment due on September 1, 2020. Any payments received prior to October 15, 2020 will be applied to the $4,900,000 balance due under the August 24, 2020 letter of intent.

 

Litigation

 

On April 22, 2020, the Company failed to repay any of the outstanding balance of the Convertible Promissory Note Payable to Iliad Research and Trading, L.P. (Note 6), resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by 10% and the Company recorded expense of $286,059 related to the default. As of June 30, 2020, the total balance due under the note was $3,234,149 including accrued interest of $192,649.

 

On May 20, 2020, Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does not intend to defend the lawsuit. On July 14, 2020, the Court entered judgment in favor of Iliad in the amount of $3,264,594 and the judgment accrues interest at the default rate of 15% per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has not been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC. 

 

 

 

ITEM 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

The following discussion and analysis contains “forward-looking statements,” as defined in the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts” or “continue” , which list is not meant to be all-inclusive and other such negative terms and comparable technology.  These forward-looking statements, include, without limitation, statements about our market opportunity, our strategies, competition, expected activities and expenditures as we pursue our business plan, and the adequacy of our available cash resources. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Actual results may differ materially from the predictions discussed in these forward-looking statements.  The economic environment within which we operate could materially affect our actual results. Additional factors that could materially affect these forward-looking statements and/or predictions include among other things: (1)product demand, market and customer acceptance of GB Sciences products, equipment and other goods, (ii) ability to obtain financing to expand its operations, (iii) ability to attract qualified personnel, (iv)competition pricing and development difficulties, (v) general industry and market conditions and growth rates, unexpected natural disasters, and other factors, which we have little or no control: and other factors discussed in the Company’s filings with the Securities and Exchange Commission (“SEC”). The Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this report.

 

The following discussion highlights the Company’s results of operations and the principal factors that have affected our financial condition, as well as our liquidity and capital resources for the periods described and provides information that management believes is relevant for an assessment and understanding of the statements of financial condition and results of operations presented herein. The following discussion and analysis is based on the Company’s unaudited financial statements contained in this Quarterly Report, which we have prepared in accordance with United States generally accepted accounting principles. You should read this discussion and analysis together with such financial statements and the related notes thereto.

 

Overview

 

GB Sciences, Inc. (“the Company”, “GB Sciences”, “we”, “us”, or “our”) seeks to be a biopharmaceutical research and cannabinoid-based drug development company whose goal is to create patented formulations for safe, standardized, cannabinoid therapies that target a variety of medical conditions in both the pharmaceutical and wellness markets. The Company is engaged in the research and development of cannabinoid medicines and plans to produce cannabinoid therapies for the wellness markets based on its portfolio of intellectual property.

 

Through its wholly owned Canadian subsidiary, GBS Global Biopharma, Inc. (“GBSGB”), the Company is engaged in the research and development of cannabinoid medicines with virtual operations in North America and Europe. GBSGB assets include cannabinoid medicine intellectual property, research contracts and key supplier arrangements. GBSGB’s intellectual property covers a range of conditions and several programs are in pre-clinical animal stage of development; including Parkinson’s disease, neuropathic pain, and cardiovascular therapeutic programs. GBSGB runs a lean drug development program and takes effort to minimize expenses, including personnel, overhead, and fixed capital expenses  through strategic partnerships with Universities and Contract Research Organizations (“CROs”). GBSGB’s intellectual property portfolio includes two issued USPTO Patents, five USPTO patent applications, four provisional USPTO patent applications, and one USPTO application that we anticipate filing by the end of calendar year 2020, as well as licenses for three additional patents covering novel cannabinoid delivery systems. In addition to the USPTO patents and patent applications, the company has filed 28 patent applications internationally.

 

We were incorporated in the State of Delaware on April 4, 2001, under the name “Flagstick Venture, Inc.” On March 28, 2008, stockholders owning a majority of our outstanding common stock approved changing our then name “Signature Exploration and Production Corp.” as our business model had changed.

 

On March 13, 2014, we entered into a definitive assets purchase agreement for the acquisition of assets, including the Growblox™ cultivation technology which resulted in a change in our corporate name on April 4, 2014, from Signature Exploration and Production Corporation to Growblox Sciences, Inc.

 

Effective December 12, 2016, the Company amended its Certificate of Corporation pursuant to shareholder approval as reported in the Form 8-K filed on October 14, 2016.  Pursuant to the amendment the Company’s name was changed from Growblox Sciences, Inc. to GB Sciences, Inc.  

 

Effective April 8, 2018, Shareholders of the Company approved the change in corporate domicile from the State of Delaware to the State of Nevada and increase in the number of authorized capital shares from 250,000,000 to 400,000,000. Effective August 15, 2019, Shareholders of the Company approved an increase in authorized capital shares from 400,000,000 to 600,000,000.

 

 

Plan of Operation

 

Drug Discovery and Development of Novel Cannabis-Based Therapies 

 

Through its wholly-owned, Canadian subsidiary, GBS Global Biopharma, Inc. ("GBSGB"), the Company has conducted ground-breaking research embracing the complexity of the whole plant led by Dr. Andrea Small-Howard, the Company’s Chief Science Officer and Director, and Dr. Helen Turner, Vice President of Innovation and Dean of the Natural Sciences and Mathematics Department at Chaminade University.  Small-Howard and Turner posited that complex mixtures of cannabinoids and terpenes that are derived from native mixtures in the cannabis plant, but with precise optimizations, would provide more targeted and effective treatments for specific disease conditions than either single cannabinoids or whole plant formulations.  They developed a rapid screening and assaying system which tested thousands of combinations of cannabinoids and terpenes in vitro against cell-based models of disease.  This process identified precise mixtures of cannabinoids and terpenes, many of which contained no THC, to treat categories of disease conditions, including neurological disorders, inflammation, heart disease, metabolic syndrome, chronic and neuropathic pain. 

 

GBSGB’s drug discovery process combines: 1) HTS: high throughput screening of tens of thousands of combinations of compounds derived from specific chemovars of the cannabis plant in well-established cellular models of diseases, and 2) NPP: a proprietary Network Pharmacology Platform algorithm for the prediction of complex therapeutic mixtures that the Company spent two-and-a-half-years training and testing against cell assay data. This combined approach to drug discovery increases research efficiency and accuracy reducing the time from ideation to patenting from 7 years to 1.5 years. Screening of cannabis-based mixtures for drug discovery involves the testing of specific combinations of plant chemicals from many naturally occurring cannabis chemovars and the use of live models for these diseases that have been well established by other researchers. First, the Company finds chemovars that show some therapeutic activity, and then refines these natural mixtures to optimize their effectiveness in cellular assays by removing compounds that do not act synergistically with the others in the mixtures.  The Company also use its internally-validated Network Pharmacology Platform to prioritize and eliminate some potential combinations, which reduces the time in the discovery period.

 

The U.S. Patent and Trademark Office allows complex mixtures to be claimed as Active Pharmaceutical Ingredients. GBSGB has two issued patents and a series of pending patents containing cannabis-derived complex mixtures that act as therapeutic agents for specific disease categories, as described below. GBSGB’s pending patents are protected whether the individual compounds are derived from the cannabis plant, another plant, synthetically produced, or derived from a combination of sources for the individual chemical compounds in these mixtures.

 

GBS Global Biopharma, Inc. has made significant strides in the past year with respect to both its drug discovery research and product development programs. Our lead pharmaceutical programs in both Parkinson’s disease and chronic neuropathic pain are now in preclinical animal studies with Dr. Lee Ellis of the National Research Council (NRC) Canada in Halifax, Nova Scotia. In addition, the two patents which protect GBSGB’s formulations in our lead development programs have been issued by the US Patent and Trademark Office (USPTO). Achieving these significant milestones is driving interest in these novel therapeutic programs.

 

For its lead program in PD therapeutics, GBSGB announced that it has obtained the statistically significant reduction of Parkinson’s-disease like symptoms using its proprietary complex mixtures in an animal model of Parkinson’s disease (PD). Several of GBSGB’s PD formulations significantly reduced the symptoms, while the most effective formula reduced the symptoms back to the baseline activity of normal animals. In addition, the toxicity studies for these PD formulas came back without any significant negative findings. These important preclinical results will be included in GBS’ Investigational New Drug (IND) application with the US FDA to enter human clinical trials as soon as possible. New therapies to address Parkinson’s disease symptoms are needed to help those afflicted with this debilitating disease. The combined direct and indirect costs associated with Parkinson’s disease are estimated at $52 billion in the U.S. alone.

 

For Parkinson’s disease, the initial clinical prototypes of GBSGB’s Cannabinoid-Containing Complex Mixtures (CCCM™) are being formulated by Catalent Pharma using Catalent’s Zydis® Orally Disintegrating Tablet (ODT) technology. This ODT format was selected for the PD formulas because it dissolves on the tongues of patients without the need to swallow for ease of use in patients with PD, who often have difficulties with swallowing. GBSGB selected Catalent as its development partner for the PD therapies due to Catalent’s prior experience in working on US FDA-approved, cannabinoid-containing drugs, their Schedule I drug manufacturing facilities, their familiarity with US FDA and international regulatory and manufacturing requirements, their expertise in tackling formulation challenges, and their ability to achieve the stability and dosing necessary for these novel complex mixtures. In addition to its Zydis® technology, Catalent has early drug development services and additional oral drug delivery solutions available for the efficient delivery of GBSGB's proprietary APIs.

 

 

For its lead chronic neuropathic pain program, GBSGB is testing its Cannabinoid-Containing Complex Mixtures (CCCM) and Myrcene-Containing Complex Mixtures (MCCM) both as encapsulated, time-released nanoparticles, as well as in non-encapsulated forms of these therapeutic mixtures in an animal model at the NRC in Halifax, Nova Scotia. In preparation for human clinical trials, our standard MCCM and the time-released MCCM are currently being compared in an animal model that demonstrates their potential effectiveness at treating chronic pain. The early results from this preclinical research project look very promising.

 

The two patents which protect formulations in the Company’s lead therapeutic programs have been issued by the USPTO. The issuance of U.S. Patent No. 10,653,640 entitled "Cannabinoid-Containing Complex Mixtures for the Treatment of Neurodegenerative Diseases" on May 19, 2020 protects methods of using GBSGB’s proprietary cannabinoid-containing complex mixtures (CCCM™) for treating Parkinson’s Disease (PD). This was an important milestone in the development of these vitally-important therapies and validates GBSGB’s drug discovery platform. In the US alone, the combined direct and indirect costs associated with Parkinson’s disease are estimated at $52 billion, and new therapies to address Parkinson’s disease symptoms are greatly needed. This was also the first time that a US patent has been awarded for a cannabis-based complex mixture defined using this type of drug discovery method. The first US patent for PD therapies validated our drug discovery platform and strengthened our intellectual property portfolio of unique CCCM’s™, each targeting one of up to 60 specific clinical applications. The issuance of GBSGB’s second US patent for active pharmaceutical ingredients that are complex mixtures identified by our biotech platform further confirms that GBSGB’s pharmaceutical compositions can be patent-protected for use as biopharmaceutical and nutraceutical products. The US Patent entitled “Myrcene-Containing Complex Mixtures Targeting TRPV1” protects methods of using GBSGB’s proprietary Myrcene-Containing Complex Mixtures (“MCCM”) for the treatment of pain disorders related to arthritis, shingles, irritable bowel syndrome, sickle cell disease, and endometriosis. In the US alone, chronic pain represents an estimated health burden of between $560 and $650 billion dollars, and an estimated 20.4% of U.S. adults suffer from chronic pain that significantly decreases their quality of life. Despite the widespread rates of addiction and death, opioids remain the standard of care treatment for most people with chronic pain. The Company believes that it is important to create safer, less addictive alternatives to opioids for the treatment of chronic pain disorders, like GBSGB’s myrcene-containing complex mixtures.

 

Favorable Research Updates from our university collaborators reveal the promise in our discovery programs with Michigan State University (HIV-Associated Neurodegenerative Disorder and COVID-19 therapies), Chaminade University (Chronic Neuropathic Pain, Metabolic Syndrome, Cannabis Metabolomics with the University of Athens), the University of Athens, Greece (Cannabis Metabolomics), the University of Seville, Spain (Time-Released Nanoparticles), and the National Research Council (NRC) of Canada (Parkinson’s Disease, Chronic Neuropathic Pain).

 

Intellectual Property Portfolio

 

GBSGB retained Fenwick & West, a Silicon Valley based law firm focusing on life sciences and high technology companies with a nationally top-ranked intellectual property practice, to develop strategies for the protection of the Company's intellectual property. The status of the intellectual property portfolio is as follows.

 

Two USPTO Patents Issued/Allowed for Cannabinoid- and Myrcene-Containing Complex Mixtures

 

Title:       CANNABINOID-CONTAINING COMPLEX MIXTURES FOR THE TREATMENT OF NEURODEGENERATIVE DISEASES

 

U.S. Patent Number 10,653,640;                       Expiration date:     October 23, 2038

Issued:                   May 19, 2020;                      Inventors:              Andrea Small-Howard et al.

 

Patent protection was granted for GBSGB’s Cannabinoid-Containing Complex Mixtures for the treatment of Parkinson’s disease.

 

Title:      MYRCENE-CONTAINING COMPLEX MIXTURES TARGETING TRPV1

 

U.S. Patent Number 10,709,670;                      Expiration date:    May 22, 2038

Issued:                   July 14, 2020;                     Inventors:              Andrea Small-Howard, et al.

 

GBSGB’s MCCMs are protected for use in the treatment of pain related to arthritis, shingles, irritable bowel syndrome, sickle cell disease, and endometriosis.

 

 

Five USPTO & Twenty-Three International Patent Applications Pending

 

Title:       CANNABINOID-CONTAINING COMPLEX MIXTURES FOR THE TREATMENT OF NEURODEGENERATIVE DISEASES

 

U.S. Patent Application No. 15/729,565;                       WIPO Application number: PCT/US2017/055989

Filed:                     October 10, 2017;                                Inventors:              Andrea Small-Howard et al.

National stage applications entered in AU, CA, CN, EP, HK, IL, and JP on October 10, 2017.

 

On April 3, 2020, GBSGB Received a Notice of Allowance on our Cannabinoid-Containing Complex Mixtures for Neurodegenerative Disease. On the same day as we paid the fee for the allowed patent claims, we filed a Continuation for Review of the non-Parkinson’s formulas within this application, which includes Alzheimer’s disease, Huntington’s disease, Lewy body dementia, and dementia. U.S. Continuation Application No. 16/844,713, filed on Apr 9, 2020, is pending. This application claims benefit of U.S. Patent Application No. 62/406,764 filed October 11, 2016. 

 

Title:      CANNABINOID-CONTAINING COMPLEX MIXTURES FOR THE TREATMENT OF MAST CELL-ASSOCIATED OR BASOPHIL-MEDIATED INFLAMMATORY DISORDERS

 

U.S. Patent Application No.15/885,620;        WIPO Application number: PCT/US2018/016296

Filed:     January 31, 2018;                                                Inventors:              Andrea Small-Howard, et al.

National stage applications entered in AU, CA, CN, EP, HK, IL, and JP on January 31, 2018.

 

Claims benefit of U.S. Patent Application No. 62/453,161 filed February 1, 2017.

 

Title:      MYRCENE-CONTAINING COMPLEX MIXTURES TARGETING TRPV1

 

U.S. Patent Application No. 15/986,316;       WIPO Patent Application No. PCT/US2018/033956

Filed:                     May 22, 2018;                      Inventors:              Andrea Small-Howard, et al.

National stage applications entered in AU, CA, CN, EP, HK, IL, and JP on May 22, 2018.

 

On May 12, 2020, GBSGB received a Notice of Allowance for its Myrcene-Containing Complex Mixtures. On the same day as we paid the fee for the allowed claims, we filed a Continuation for the review of the other formulations including those for heart disease and other TRPV1-related pathologies. U.S. Continuation Application No. 16/878,295, filed on May 19, 2020, is pending. Claims benefit of U.S. Patent Application No. 62/509,546 filed May 22, 2017.

 

Title:      TRPV1 ACTIVATION-MODULATING COMPLEX MIXTURES OF CANNABINOIDS AND/OR TERPENES

 

U.S. Patent Application No.: 16/420,004;      WIPO Patent Application No.: PCT/US2019/033618

Filed:                     May 22, 2019;                      Inventors:              Andrea Small-Howard, et al.

 

Claims benefit of U.S. Patent Application Nos. 62/674,843 filed May 22, 2018; 62/769,743 filed November 20, 2018; and 62/849,719 filed May 17, 2019.

 

Title:      THERAPEUTIC NANOPARTICLES ENCAPSULATING TERPENOIDS AND/OR CANNABINOIDS

 

U.S. Patent Application No.:16/686,069        WIPO Patent Application No.: PCT/ES2019/070765

Filed:                     November 8, 2019;             Inventors:              Andrea Small-Howard, et al.

 

Claims benefit of U.S. Patent Application Nos. 62/757,660 filed November 8, 2018

 

Two Provisional USPTO Patent Applications Pending

 

Title:      TREATMENT OF PAIN USING ALLOSTERIC MODULATOR OF TRPV1

 

U.S. Patent Application No.: 62/868,794;       Inventors:            Andrea Small-Howard, et al.

Filed:                     June 28, 2019

 

Title:      THERAPEUTIC NANOPARTICLES ENCAPSULATING TERPENOIDS AND/OR

 

CANNABINOIDS

U.S. Patent Application No.: 62/897,235       Inventors: Andrea Small-Howard, et al.

Filed: September 6, 2019

 

 

Two Additional Provisional Patent Applications Filed on August 18, 2020

 

 

Title:      CANNABINOID-CONTAINING COMPLEX MIXTURES FOR THE TREATMENT OF CHRONIC INFLAMMATORY DISORDERS

 

Filing Date:          August 18, 2020;                 Inventor:               Andrea Small-Howard

 

Title:      CANNABINOID-CONTAINING COMPLEX MIXTURES FOR THE TREATMENT OF OF CYTOKINE RELEASE SYNDROME WHILE PRESERVING KEY ANTI-VIRAL IMMUNE REACTIONS

 

Filing Date:       August 18, 2020;                    Inventor:               Andrea Small-Howard

 

Licensed Patents for GBSGB’s Intellectual Property Portfolio

 

Title:      METHODS AND COMPOSITIONS FOR PREVENTION AND TREATMENT OF CARDIAC HYPERTROPHY.

 

Inventor:               Alexander Stokes;               Assignee:              University of Hawai’i

Commercialization rights licensed to Makai Biotech, LLC

Sublicensed by Makai Biotech, LLC to GBS Global Biopharma, Inc.

Status: Granted in the following territories on the corresponding dates

U.S. Patent Number: 9,084,786;                      Issued: July 21, 2015

U.S. Patent Number: 10,137,123;                    Issued: November 27, 2018

U.S. Continuation Application:  16/181,204

European Union Patent Number: 2,635,281; Granted: March 14, 2018

Europe Patent Application: 3,348,267

Hong Kong Patent Number: 14102182.8; Granted: March 14, 2018

India Patent Application: 1404/KOLNP/2013

China Patent Application: 201180063998.4

 

Title:       METHOD FOR PRODUCING A PHARMACEUTICAL COMPOSITION OF POLYMERIC NANOPARTICLES FOR TREATING NEUROPATHIC PAIN CAUSED BY PERIPHERAL NERVE COMPRESSION

 

Inventors:              Martin Banderas, Lucia; Fernandez Arevala, Mercedes; Berrocoso, Dominguez, Esther; and Mico Segura, Juan Antonio

Assignees:             Universidad de Sevilla, Universidad de Cadiz, and Centro de Investigacion Biomedica En Red (CIBER)

Exclusive worldwide license held by GBS Global Biopharma, Inc.

WIPO/PCT Application: PCT/ES2016/000016 (Pub. No. WO 2016/128591)

Filed: August 18, 2016

Claims benefit of Spanish Patent Application no. P201500129 (Pub. No. ES 2582287)

Filed:  February 9, 2015

U.S. Patent Application: 15/549,653

Spain Patent ES2582287; Granted: September 29, 2017

Europe Patent Application: EP3257503

Canada Patent Application CA2976040

 

 

Partnering Strategy 

 

GBSGB runs a lean drug development program and minimizes expenses, including personnel, overhead, and fixed capital expenses (such as lab and diagnostic equipment), through strategic partnerships with Universities and Contract Research Organizations (“CROs”). Through these research and development agreements, GBSGB has created a virtual pipeline for the further development of novel medicines extracted from the cannabis plant. The partners bring both expertise and infrastructure at a reasonable cost to the life sciences program. In most instances, GBSGB has also negotiated with these partners to keep 100% of the ownership of the IP within GBSGB for original patent filings.

 

GBSGB currently has on-going research agreements with the following institutions covering the indicated areas of research:

 

Chaminade University: Broad-based research program to support the drug discovery platform that has yielded most of GBSGB’s original patents to date in the areas of neurodegenerative diseases, heart disease, inflammatory diseases, neuropathic pain and chronic pain. They have also performed the bioassay portion of the Cannabis Metabolomics study performed with the University of Athens, Greece and GBSGB.

 

University of Athens: Broad-based metabolomics analysis of over 100 cannabis genotypes including both hemp and THC-producing cannabis varieties, in combination with GBSGB’s bioassay data linking genotypes and potential disease-remediations. This project has the potential to define active ingredients from plant-derived mixtures beyond the standard cannabinoids and terpenoids. The discovery potential is huge, and novel agents have recently been discovered.

 

Michigan State University: Discovery work using a cutting-edge, multi-cellular model of the human immune system and a multi-cell model of the brain to explore CCCM™s for use in the prevention of HIV-Associated Neurocognitive Disorders (HAND). Although combination antiretroviral therapy keeps symptoms for most HIV-patients well controlled, between 40% and 70% of these well-controlled HIV patients end up with HAND symptoms that range from movement disorders to dementia-like symptoms. The results from this work were included in a new patent application that will be filed in Q3 of 2020. In addition, MSU has performed experiments using their novel model of the human-immune system that have allowed GBSGB to prepare cannabis-based formulas for the potential treatment of virally-induced hyperinflammation/cytokine storm syndrome that has led to the majority of COVID-19 deaths. The new patent application for our novel, cannabinoid-containing complex mixtures (CCCM™) for the treatment of hyperinflammation and cytokine storm syndrome in COVID-19 patients will also be filed in Q3 of 2020.

 

The University of Seville: Bringing their novel expertise to the development and functional testing of time-released and disease-targeted nanoparticles of cannabis-based complex mixtures for oral administration. These specialized nanoparticles are being used for the precise and time-released delivery of several of our therapies, including GBSGB’s MCCM™ and CCCM™’s used in the preclinical animal testing performed at the NRC Canada. The University of Seville has completed functional testing on nanoparticles containing myrcene, nerolidol, and beta-caryophyllene for our Myrcene-Containing Complex Mixtures. In these cell-based assays, the effectiveness and kinetics of the nanoparticle-forms of these terpenes were compared with the “naked” terpenes both individually and in mixtures. In all cases, the effectiveness of the nanoparticles were superior to the naked terpenes, however, the mixtures were dramatically more effective than the individuals. These results from Seville are very promising as these nanoparticles have entered the animal testing phase at the NRC in Halifax.

 

The National Research Center (NRC) of Canada, Halifax, Nova Scotia: Two animal-phase studies are being performed by Dr. Lee Ellis’ group at the NRC. An animal safety and efficacy study was initiated in Q4 of 2018 for GBSGB’s Parkinson’s disease therapies, and the NRC has demonstrated that the company’s PD formulations were able to reduce behavioral changes associated with the loss of dopamine-producing neurons, which underlies the pathology of Parkinson’s disease in the animal model. Based on achieving the statistically significant reduction in Parkinson’s disease symptomology, GBSGB has signed an amendment to include a final phase of testing, which will study the mechanism of action for these promising formulations. In Q1 of 2019, GBSGB started a safety and efficacy study in animals for GBSGB’s Chronic Neuropathic Pain (CNP) formulas. The midterm results for these preclinical pain studies are promising.

 

The University of Cadiz: Testing the safety and efficacy of the above-mentioned time-released nanoparticles in rodent models of chronic pain. Proof of concept complete for one formulation.

 

University of Hawaii: Validating the efficacy of a complex cannabis-based mixture for the treatment of cardiac hypertrophy and cardiac disease in a rodent model. Proof of concept work is complete.

 

 

Path to Market: Drug Development Stages and Proposed Clinical Trials

 

GBSGB has cannabis-based therapeutic products in the following stages of drug development: Discovery, Pre-Clinical, and entering the Clinical Phase. It has also licensed therapeutic products that the Company intends to develop through partners, labeled Partner Programs.

 

The completion of pre-clinical studies, clinical trials, and obtaining FDA-approvals for pharmaceutical products is traditionally a long and expensive process. However, GBSGB asserts that its cannabis-based drug discovery engine, lean development program, novel regulatory strategy, experienced development partners, and aggressive licensing of these products at early clinical stages can mitigate some of the risks. The Company uses a combination of in silico discovery methods and automated screening of cellular models of disease to decrease the time in Discovery prior to filing novel patent applications for disease-specific therapeutics. GBSGB’s original patent applications cover new chemical entities (“NCE”) based on complex combinations of plant-derived compounds. Its Exploratory IND/Phase 0 Program gets the Company to First-in-Man sooner than traditional programs, which reduces translational risks, and includes preliminary efficacy measures for responsible development decisions. In contrast, a traditional phased-development path would not provide any efficacy measures until Phase II. After the completion of our Phase 0 study, which compares the efficacies of multiple related cannabis-based formulations, the Company plans to advance the lead drug candidate using an adaptive trial design that is more efficient than the traditional phased-development pathway. GBSGB has entered into research contracts, partnerships, and/or joint ventures with several respected, independent contract research organizations, medical schools, universities, and other scientific researchers to increase developmental efficiencies. If and when one or more of GBSGB’s drugs, therapies or treatments are approved by the FDA, GBSGB will seek to market them under licensing arrangements with major biotechnology or pharmaceutical companies.

 

GBSGB plans to use a combination of FDA-registered human clinical trials, as described in detail above, and pilot human studies in the development of its therapeutic product portfolio. Early in product development, human pilot studies that are fully compliant with state medical cannabis programs will be used to gather early data on safety and efficacy that can later be referenced in the next phase of product development. GBSGB may be able to produce and sell the early products that prove efficacious, through licensing agreements with cannabis companies in other US states and countries that have legalized cannabis programs.  GBSGB believes that these pilot studies will provide significant value by reducing the cost of commercialization, more rapidly putting effective drugs in the hands of patients, and accelerating by years the monetization of the research. GBSGB’s goal is to be the perfect partner to those companies with greater resources and experience in the marketing and distribution of medications worldwide.

 

There can be no assurance that we will ever be able to enter into any joint ventures or other arrangements with third parties to finance our drug development program or that if we are able to do so, that any of our projected therapies will ever be approved by the FDA. Even if we obtain FDA approval for a therapy, there can be no assurance that it could be successfully marketed or would not be superseded by another cannabis-based therapy produced by one or more of our competitors. It also may be anticipated that even if we enter into a joint venture development with a financially stable pharmaceutical or institutional partner, we will still be required to raise significant additional capital in the future to achieve the strategic goals of GBSGB. There can be no assurance that we will be able to obtain such additional capital on reasonable terms, if at all. If GBSGB fails to achieve its goal of producing one or more cannabis-based pharmaceuticals or therapies, it would have a material adverse effect on our future financial condition and business prospects.

 

In addition to our biopharmaceutical research and development activities described in detail above, the Company has operated in the medical and adult-use cannabis markets under State-issued cultivation and production licenses.  Our wholly owned subsidiary GB Sciences Nevada, LLC (“GBSN”) leases a warehouse facility at 3550 W. Teco Avenue, Las Vegas Nevada (the "Teco Facility") and operates a cannabis cultivation facility under Nevada licenses for the medical and adult-use markets. Our wholly owned subsidiary GB Sciences Las Vegas, LLC ("GBLV") holds Nevada certificates for medical and adult-use cannabis production and produces extracts and concentrates for the wholesale market.

 

On September 18, 2017, our subsidiary GB Sciences Louisiana, LLC finalized its agreement with Louisiana State University (“LSU”) AgCenter to be the sole operator of LSU’s medical marijuana program. The LSU Board of Supervisors entered into a five-year agreement—that has an option to renew for two additional five-year terms—with GB Sciences.The contract included the Company’s commitment to make a minimum financial contribution to the LSU AgCenter in the amount of $3.4 million, or a 10% commission of gross receipts, in addition to annual research investments of $500,000 to the LSU AgCenter. The monetary contributions would be used to conduct research on plant varieties, compounds, extraction techniques and delivery methods that could generate additional revenue through discoveries that are subject to intellectual property rights, which AgCenter would retain 50% of those rights.

 

On November 15, 2019, the Company entered into the Membership Interest Purchase Agreement ("MIPA") with the noncontrolling interest in GB Sciences Louisiana, LLC. In consideration for the sale of its 50.01% membership interest in GBSLA, the Company received the $8,000,000 Promissory Note  ("Wellcana Note") and may receive up to an additional $8,000,000 in earn-out payments.

 

 

On November 15, 2019, we entered into a Binding Letter of Intent (the "LOI") to sell 75% of the Company's membership interest interests in GBSN and GBLV (together, the "Teco Subsidiaries") for $3.0 million cash upon close and up to an additional $3.0 million in earn-out payments after close. In connection with the LOI, we entered into a Management Agreement with the purchaser whereby the facilities will be managed by an affiliate of the purchaser until the close of the sale. On March 24, 2020, we entered into the Membership Interest Purchase Agreement ("Teco MIPA") which formalized the sale of the Teco Subsidiaries and modified the terms of the sale. Pursuant to the Teco MIPA, the Company will sell 100% of its membership interests in GBSN and GBLV for $4.0 million cash upon close and will receive a $4.0 million 8% promissory note to be paid in monthly installments over 36 months.

 

The Company also holds a Nevada license for cultivation of medical marijuana located in Sandy Valley, Nevada (the “Nopah License”). The license is owned by the Company’s wholly owned subsidiary, GB Sciences Nopah, LLC ("Nopah"). Operations have not begun under the Nopah License. On November 27, 2019, the Company entered into a Binding Letter of Intent to sell its 100% interest in GB Sciences Nopah, LLC (the “Nopah LOI”), with the transaction closing upon transfer of the Nopah License. As consideration for the transfer of the license, the Company will receive $300,000 and the purchaser will pay all expenses related to the upkeep and maintenence of the Nopah License. The transfer of the Nopah License is subject to the same restrictions on license transfers currently in effect in the State of Nevada (see Note 16).

 

The sales of the Teco Facility and Nopah are expected to close upon the successful transfer of the Nevada cultivation and production licenses. The transfer of cannabis licenses in the State of Nevadahas been subject to an indefinite moratorium since October 2019. In a meeting held on July 21, 2020, the Nevada Cannabis Compliance Board lifted the moratorium, however, the board has indicated that there are over 90 requests pending and it will take up to several months to process the entire backlog of pending license transfers. Based on this information, we cannot provide any assurances as to the timing of the close of the sale. The lifting of the moratorium and processing of cannabis license transfers have been delayed by the COVID-19 pandemic and could be further delayed if the pandemic continues.

 

 

RESULTS OF OPERATIONS

 

The following table sets forth certain of our Statements of Operations data:

 

   

For the Three Months Ended

 
   

June 30,

 
   

2020

   

2019

 
                 

SALES REVENUE

  $ 551,197     $ 910,676  

COST OF GOODS SOLD

    (491,795 )     (624,369 )

GROSS PROFIT

    59,402       286,307  

GENERAL AND ADMINISTRATIVE EXPENSES

    804,708       2,065,549  

LOSS FROM OPERATIONS

    (745,306 )     (1,779,242 )

OTHER INCOME/(EXPENSE)

    (1,092,554 )     (437,815 )

NET LOSS BEFORE INCOME TAX EXPENSE

    (1,837,860 )     (2,217,057 )

INCOME TAX EXPENSE

    (8,840 )     (57,392 )

LOSS FROM CONTINUING OPERATIONS

    (1,846,700 )     (2,274,449 )

LOSS FROM DISCONTINUED OPERATIONS

    -       (264,434 )

NET LOSS

    (1,846,700 )     (2,538,883 )

NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST

    -       (132,216 )

NET LOSS ATTRIBUTABLE TO GB SCIENCES, INC.

  $ (1,846,700 )   $ (2,406,667 )

 

Comparison of the Three Months Ended June 30, 2020 and 2019

 

Sales revenue

 

The Company recorded sales revenue of $551,197 for the three months ended June 30, 2020, as compared to $910,676 for the same period in the prior year. The decrease in sales is largely attributable to the COVID-19 pandemic and the temporary closing of retail cannabis stores in the State of Nevada.

 

Cost of goods sold

 

Cost of goods sold decreased to $491,795 for the three months ended June 30, 2020, compared to $624,369 for the three months ended June 30, 2019. The decrease is largely attributable to the decrease in sales volume as the result of the COVID-19 pandemic.

 

General and Administrative Expenses

 

General and Administrative Expenses decreased by $(1,260,841) to $804,708 for the three months ended June 30, 2020, compared to $2,065,549 for the three months ended June 30, 2019. The decrease is attributable to a company-wide initiative to reduce general and administrative costs, including a substantial reduction in the number of employees involved in administrative functions.

 

Other expense

 

Other expenses increased $654,739 to $1,092,554 for the three months ended June 30, 2020, compared to $437,815 for the three months ended June 30, 2019. The increase in other expense is primarily the result of the $286,059 default penalty related to the note payable to Iliad Research and Trading, LP, which is recorded in other expense, and an increase of $357,498 in interest expense due to larger debt balances outstanding at higher effective interest rates.

 

 

LIQUIDITY AND CAPITAL RESOURCES

 

Current Liquidity

 

The Company will need additional capital to implement its strategies. There is no assurance that it will be able to raise the amount of capital needed for future growth plans. Even if financing is available, it may not be on terms that are acceptable. If unable to raise the necessary capital at the times required, the Company may have to materially change the business plan, including delaying implementation of aspects of the business plan or curtailing or abandoning the business plan. The Company represents a speculative investment and investors may lose all of their investment. In order to be able to achieve the strategic goals, the Company needs to further expand its business and financing activities. Based on the Company's cash position, it is necessary to raise additional capital by the end of the next quarter in order to continue to fund current operations. These factors raise substantial doubt about the ability to continue as a going concern.  The Company is pursuing several alternatives to address this situation, including the raising of additional funding through equity or debt financings. In order to finance existing operations and pay current liabilities over the next twelve months, the Company will need to raise additional capital. No assurance can be given that the Company will be able to operate profitably on a consistent basis, or at all, in the future.

 

The principal sources of liquidity to date have been cash generated from sales of debt and equity securities and loans.

 

At June 30, 2020, cash was $101,230, other current assets excluding cash were $7,019,880, and our working capital deficit was $(5,381,534). At the same time, current liabilities were $12,502,644 and consisted principally of $2,712,122 in accounts payable, $1,843,698 in accrued liabilities, $6,327,113 in notes and convertible notes payable, net of $(247,695) in discounts, $712,176 in indebtedness to related parties, a note payable to related party of $151,923, $601,822 in income tax payable, and $146,211 in current finance lease obligations. At March 31, 2020, the Company had a cash balance of $151,766, other current assets excluding cash were $6,849,114, and our working capital deficit was $(3,884,877). Current liabilities were $10,885,757, which consisted principally of $2,559,914 in accounts payable, $1,285,664 in accrued liabilities, $5,534,728 in notes and convertible notes payable, $586,512 of indebtedness to related parties, a note payable to related party of $151,923, $592,982 in income taxes payable, and $166,769 in current finance lease obligations.

 

 

Sources and Uses of Cash

 

Operating Activities

 

Net cash used in operating activities was $(323,845) for the three months ended June 30, 2020, compared to $(2,631,121) for the three months ended June 30, 2019, including $(883,295) used in discontinued operations. We anticipate that cash flows from operations may be insufficient to fund business operations for the next twelve-month period. Accordingly, we will have to generate additional liquidity or cash flow to fund our current and anticipated operations. This will likely require the sale of additional common stock or other securities. There is no assurance that we will be able to realize any significant proceeds from such sales, if at all.

 

Investing Activities

 

During the three months ended June 30, 2020, the Company used no cash in investing activities, compared to $(257,674) during the three months ended June 30, 2019, including $(48,000) used in discontinued operations. The cash used in investing activities during the three months ended June 30, 2019 was primarily for the purchase of property and equipment and the acquisition of intangible assets.

 

Financing Activities

 

During the three months ended June 30, 2020 and 2019, cash flows provided by financing activities totaled $273,309 and $2,802,349, respectively. Cash flows from financing activities for the three months ended June 30, 2020 related primarily to $151,202 in proceeds from warrant exercises and $150,000 in proceeds from the issuance of a note payable, offset by $(17,772) of principal payments on debt and finance lease obligations and $(15,121) in brokerage fees. Cash flows from financing activities for the three months ended June 30, 2019 related primarily to $745,975 in proceeds from the sale of common stock and $2,500,000 in proceeds from issuing convertible notes, offset by $(175,000) in fees for the issuance of a convertible note, $(91,104) of brokerage fees, and $(62,641) of principal payments on debt and finance lease obligations.

 

Going Concern 

 

The Company’s financial statements have been prepared assuming the Company will continue as a going concern. The Company has sustained net losses since inception, which have caused an accumulated deficit of $(99,251,168) at June 30, 2020. The Company had a working capital deficit of $(5,381,534) at June 30, 2020, compared to $(3,884,877) at March 31, 2020. In addition, the Company has consumed cash in its operating activities of $(323,845) for the three months ended June 30, 2020, compared to $(2,631,121) including $(883,295) from discontinued operations for the three months ended June 30, 2019. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.

 

Management has been able, thus far, to finance the losses through a public offering, private placements and obtaining operating funds from stockholders. The Company is continuing to seek sources of financing.  There are no assurances that the Company will be successful in achieving its goals.

 

In view of these conditions, the Company’s ability to continue as a going concern is dependent upon its ability to obtain additional financing or capital sources, to meet its financing requirements, and ultimately to achieve profitable operations. Management believes that its current and future plans provide an opportunity to continue as a going concern. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that may be necessary in the event the Company is unable to continue as a going concern.

 

 

VARIABLES AND TRENDS

 

In the event the Company is able to obtain the necessary financing to progress with its business plan, the Company expects expenses to increase significantly to grow the business. Accordingly, the comparison of the financial data for the periods presented may not be a meaningful indicator of future performance and must be considered in light of these circumstances.

 

CRITICAL ACCOUNTING POLICIES

 

A description of the Company's significant accounting policies is included in Note 3 of its Annual Report on Form 10–K for the fiscal year ended March 31, 2020.

 

ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

 

ITEM 4.  Controls and Procedures

 

Evaluation of Disclosure Controls and Procedures

 

The Company  maintains disclosure controls and procedures that are designed to ensure that material information required to be disclosed in the periodic reports filed under the Securities Exchange Act of 1934, as amended, or 1934 Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and to ensure that such information is accumulated and communicated to management, including the chief executive officer and chief financial officer as appropriate, to allow timely decisions regarding required disclosure. At the end of the quarter ended June 30, 2020, the Company carried out an evaluation, under the supervision and with the participation of management, including the principal executive officer and the principal financial officer, of the effectiveness of the design and operation of disclosure controls and procedures, as defined in Rule 13(a)-15(e) and Rule 15d-15(e) under the 1934 Act. Based on this evaluation, management concluded that as of June 30, 2020, the disclosure controls and procedures were not effective due to material weaknesses as no member of our board of directors qualifies as an “audit committee financial expert” as defined in Item 407(d)(5) of Regulation S-K promulgated under the Securities Act.

 

Limitations on Effectiveness of Controls and Procedures

 

Management, including the Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer), does not expect that disclosure controls and procedures will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include, but are not limited to, the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

 

Changes in Internal Controls

 

During the fiscal quarter ended June 30, 2020, there have been no changes in the internal controls over financial reporting that have materially affected or are reasonably likely to materially affect the internal controls over financial reporting. 

 

 

PART II – OTHER INFORMATION

ITEM 1.  Legal Proceedings

 

Tara “Dee” Russell filed a Charge of Discrimination with the Nevada Equal Rights Commission ("NERC") against the Company on April 2, 2019, alleging that she was subjected to sexual harassment and retaliatory discharge. The Company received the Notice of Charge of Discrimination on or about May 15, 2019. The Company submitted its response to the Notice of Discrimination Charge on July 26, 2019. It is the Company's position that Ms. Russel was not an employee of the Company, but rather was an independent contractor. The Company intends to aggressively respond to the charge. To date, the NERC has not issued a ruling regarding the charge.

 

On April 22, 2020, the Company failed to repay any of the outstanding balance of the Convertible Promissory Note Payable to Iliad Research and Trading, L.P., resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by 10% and the Company recorded expense of $286,059 related to the default. As of June 30, 2020, the total balance due under the note was $3,146,453.

 

On May 20, 2020, Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does not intend to defend the lawsuit. On July 14, 2020, the Court entered judgment in favor of Iliad in the amount of $3,264,594 and the judgment accrues interest at the default rate of 15% per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has not been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC. 

 

On April 22, 2020, the Company was served notice of a lawsuit filed in the Eighth Judicial District Court in Clark County, Nevada, filed by a contractor who had been hired to perform architectural and design services. The lawsuit demands payment of $73,050 for the services provided. The Company intends to negotiate a settlement and the full amount demanded in the lawsuit of $73,050 is accrued in accounts payable as of March 31, 2020.

 

ITEM 1A.  Risk Factors

 

There are no material changes from the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2020, as filed with the SEC.

 

ITEM 2.  Unregistered Sales of Equity Securities and Use of Proceeds

 

On April 1, 2020, the Company entered into the Advisory Agreement with its brokers and effected a temporary decrease in the exercise price of the Company's outstanding warrants to $0.03-$.05 per share. As a result of the price reduction, the Company received notice of the exercise of 4,991,084 warrants during the June 30, 2020 and received proceeds of $136,081, net of brokerage fees of $(15,121).

 

On May 7, 2020, the Company received $135,000 cash from an investor, net of $(15,000) in brokerage fees, and issued a $150,000 convertible promissory note. The note bears interest at a rate of 8.0% per annum. The note is to be repaid upon the first proceeds received from the $8 million promissory note related to the sale of the Company's membership interest in GB Sciences Louisiana, LLC, or from the proceeds of the sale of the Teco Facility. As inducement to enter into the note transaction, the Company repriced 8,002,500 preexisting warrants held by the investor to an exercise price of $0.04. The repriced warrants were valued at $272,085 on the date of the transaction using the Black-Scholes Model, which exceeded the value of the warrants prior to the price reduction of $49,525 by $222,560. As the result of the increase in the estimated fair value of the warrants, the Company recorded a full discount on notes payable of $(150,000).

 

 

ITEM 3. Defaults Upon Senior Securities

 

On April 22, 2020, the Company failed to make payment of the principal and accrued interest due under the Iliad Note, resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by 10% and the Company recorded an expense of $286,059 related to the default. As of June 30, 2020, the total balance due under the note was $3,234,149.

 

On May 20, 2020, Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does not intend to defend the lawsuit. On July 14, 2020, the Court entered judgment in favor of Iliad in the amount of $3,264,594 and the judgment accrues interest at the default rate of 15% per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has not been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC. 

 

ITEM 4.  Mine Safety Disclosures

 

Not Applicable.

 

ITEM 5.  Other Information

 

None.

 

ITEM 6.  Exhibits

 

In reviewing the agreements included as exhibits to this Form 10-Q, please remember that they are included to provide you with information regarding their terms and are not intended to provide any other factual or disclosure information about the Company or the other parties to the agreements. The agreements may contain representations and warranties by each of the parties to the applicable agreement. These representations and warranties have been made solely for the benefit of the parties to the applicable agreement and:

 

●should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate; 

 

●have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement; 

 

●may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and 

 

●were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments. 

 

Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any other time. Additional information about the Company may be found elsewhere in this Form 10-Q and the Company’s other public filings, which are available without charge through the SEC’s website at http://www.sec.gov.

 

 

The following exhibits are included as part of this report:

 

Exhibit

Number

  

Description of Exhibit

3.1

 

Articles of Incorporation (Incorporated by reference to an exhibit to Form SB-2 No. 333-82580 filed with the Commission on February 12, 2002)

3.2

 

Amendment to Articles of Incorporation (Incorporated by reference to Exhibit 3.2 to Form S-1/A No. 333-82580 filed with the Commission on October 6, 2014 and Exhibit 3.2 to the Annual Report on Form 10-K filed with the Commission on June 27, 2014)

3.3   Articles of Incorporation (Incorporated by reference to Exhibit 3.3 to the Annual Report on Form 10-K filed with the Commission on August 28, 2020)
3.4   Amendment to Articles of Incorporation (Incorporated by reference to Exhibit 3.3 to the Annual Report on Form 10-K filed with the Commission on August 28, 2020)

3.5

 

Bylaws (Incorporated by reference to an exhibit to Form SB-2 No. 333-82580 filed with the Commission on February 12, 2002)

31.1

  

Certification of Principal Executive Officer and Pursuant to Rule 13a-14

31.2

  

Certification of Principal Financial Officer Pursuant to Rule 13a-14

32.1*

  

CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

32.2*

  

CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

101.INS

  

XBRL Instance Document

101.SCH

  

XBRL Taxonomy Extension Schema Document

101.CAL

  

XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB

  

XBRL Taxonomy Extension Labels Linkbase Document

101.PRE

  

XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF

  

XBRL Taxonomy Extension Definition Linkbase Document

 

* This certification is being furnished and shall not be deemed “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.

 

 

SIGNATURES

 

 

In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  

GB SCIENCES, INC.

  

  

September 2, 2020

By:

/s/ John Poss

  

John Poss, Chief Executive Officer

(Principal Executive Officer)

  

  

  

GB SCIENCES, INC.

  

  

September 2, 2020

By:

/s/ Zach Swarts

  

Zach Swarts, Chief Financial Officer

(Principal Financial Officer)

 

40
EX-31.1 2 ex_200414.htm EXHIBIT 31.1 ex_168439.htm

Exhibit 31.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE AND FINANCIAL OFFICER 

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, John Poss, certify that:

 

1.I have reviewed this quarterly report on Form 10-Q of GB Sciences, Inc.; 

 

2.Based on my knowledge, the quarterly report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 

 

3.Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of and for the periods presented in this report; 

 

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: 

 

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; 

 

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; 

 

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures; and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 

 

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 

 

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function): 

 

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and 

 

(b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls. 

 

Date:  September 2, 2020

/s/ John Poss

  

John Poss, Chief Executive Officer

(Principal Executive Officer)

 

 
EX-31.2 3 ex_200415.htm EXHIBIT 31.2 ex_168440.htm

Exhibit 31.2

 

CERTIFICATION OF PRINCIPAL EXECUTIVE AND FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Zach Swarts, certify that:

 

1.I have reviewed this quarterly report on Form 10-Q of GB Sciences, Inc.; 

 

2.Based on my knowledge, the quarterly report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 

 

3.Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of and for the periods presented in this report; 

 

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: 

 

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; 

 

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; 

 

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures; and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 

 

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 

 

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function): 

 

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and 

 

(b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls. 

 

Date:  September 2, 2020

/s/ Zach Swarts

  

Zach Swarts, Chief Financial Officer

(Principal Financial Officer)

 

 

 
EX-32.1 4 ex_200416.htm EXHIBIT 32.1 ex_168441.htm

Exhibit 32.1

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

 

AS ADOPTED PURSUANT TO

 

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of GB Sciences, Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John Poss, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 

 

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. 

 

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

 

Date:  September 2, 2020

/s/ John Poss

  

John Poss, Chief Executive Officer
(Principal Executive Officer)

 

 
EX-32.2 5 ex_200417.htm EXHIBIT 32.2 ex_168442.htm

Exhibit 32.2

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

 

AS ADOPTED PURSUANT TO

 

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of GB Sciences, Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Zach Swarts, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 

 

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. 

 

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

 

Date:  September 2, 2020

/s/ Zach Swarts

  

Zach Swarts, Chief Financial Officer
(Principal Financial Officer)

 

 

 
EX-101.INS 6 gblx-20200630.xml XBRL INSTANCE DOCUMENT false --03-31 Q1 2021 2020-06-30 10-Q 0001165320 280532686 Yes false Non-accelerated Filer Yes GB SCIENCES INC false true 250000 250000 250000 15121 4991084 8000000 28804000 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">6</div> &#x2013; Convertible Notes </div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"> March 2017 </div><div style="display: inline; font-style: italic; font: inherit;">$2M</div> Convertible Note Offering</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">In <div style="display: inline; font-style: italic; font: inherit;"> March 2017, </div>the Company entered into a Placement Agent's Agreement with a <div style="display: inline; font-style: italic; font: inherit;">third</div>-party brokerage firm to offer units consisting of a <div style="display: inline; font-style: italic; font: inherit;">$1,000</div> <div style="display: inline; font-style: italic; font: inherit;">6%</div> promissory note convertible into <div style="display: inline; font-style: italic; font: inherit;">4,000</div> shares of the Company's common stock at <div style="display: inline; font-style: italic; font: inherit;">$0.25</div> per share and <div style="display: inline; font-style: italic; font: inherit;">4,000</div> warrants to purchase shares of the Company's' common stock at an exercise price of <div style="display: inline; font-style: italic; font: inherit;">$0.60</div> per share for the period of <div style="display: inline; font-style: italic; font: inherit;">three</div> years. Between <div style="display: inline; font-style: italic; font: inherit;"> March 2017 </div>and <div style="display: inline; font-style: italic; font: inherit;"> May 2017, </div>the Company issued short-term Promissory Notes (&#x201c;Notes&#x201d;) to various holders with combined face value of <div style="display: inline; font-style: italic; font: inherit;">$2,000,000.</div> The Notes are payable within <div style="display: inline; font-style: italic; font: inherit;">three</div> years of issuance and are convertible into <div style="display: inline; font-style: italic; font: inherit;">8,000,000</div> shares of the Company's common stock. The Company also issued <div style="display: inline; font-style: italic; font: inherit;">8,000,000</div> common stock warrants to the Noteholders. The warrants are exercisable at any time and from time to time before maturity at the option of the holder. Each warrant gives the Noteholder the right to purchase <div style="display: inline; font-style: italic; font: inherit;">one</div> share of common stock of the Company at an exercise price of <div style="display: inline; font-style: italic; font: inherit;">$0.60</div> per share for a period of <div style="display: inline; font-style: italic; font: inherit;">three</div> years. &nbsp;The Company recorded an aggregate discount on convertible notes of <div style="display: inline; font-style: italic; font: inherit;">$1,933,693,</div> which included <div style="display: inline; font-style: italic; font: inherit;">$904,690</div> related to the relative fair value of beneficial conversion features and <div style="display: inline; font-style: italic; font: inherit;">$1,029,003</div> for the relative fair value of the warrants issued with each note. The fair value of warrants was derived using the Black-Scholes valuation model.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"> July 2017 </div><div style="display: inline; font-style: italic; font: inherit;">$7.2M</div> Convertible Note Offering</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">In <div style="display: inline; font-style: italic; font: inherit;"> July, 2017, </div>the Company entered into a Placement Agent's Agreement with a <div style="display: inline; font-style: italic; font: inherit;">third</div>-party brokerage firm to offer units consisting of a <div style="display: inline; font-style: italic; font: inherit;">$1,000</div> <div style="display: inline; font-style: italic; font: inherit;">6%</div> promissory note convertible into <div style="display: inline; font-style: italic; font: inherit;">4,000</div> shares of the Company's common stock at <div style="display: inline; font-style: italic; font: inherit;">$0.25</div> per share and <div style="display: inline; font-style: italic; font: inherit;">4,000</div> warrants to purchase shares of the Company's' common stock at an exercise price of <div style="display: inline; font-style: italic; font: inherit;">$0.65</div> per share for the period of <div style="display: inline; font-style: italic; font: inherit;">three</div> years. Between <div style="display: inline; font-style: italic; font: inherit;"> July 2017 </div>and <div style="display: inline; font-style: italic; font: inherit;"> December 2017, </div>the Company issued short-term Promissory Notes (&#x201c;Notes&#x201d;) to various holders with combined face value of <div style="display: inline; font-style: italic; font: inherit;">$7,201,000.</div> The Notes are payable within <div style="display: inline; font-style: italic; font: inherit;">three</div> years of issuance and are convertible into <div style="display: inline; font-style: italic; font: inherit;">28,804,000</div> shares of the Company's common stock. The Company also issued <div style="display: inline; font-style: italic; font: inherit;">28,804,000</div> common stock warrants to the Noteholders. The warrants are exercisable at any time and from time to time before maturity at the option of the holder. Each warrant gives the Noteholder the right to purchase <div style="display: inline; font-style: italic; font: inherit;">one</div> share of common stock of the Company at an exercise price of <div style="display: inline; font-style: italic; font: inherit;">$0.60</div> per share for a period of <div style="display: inline; font-style: italic; font: inherit;">three</div> years.The Company recorded an aggregate discount on convertible notes of <div style="display: inline; font-style: italic; font: inherit;">$7,092,796,</div> which included <div style="display: inline; font-style: italic; font: inherit;">$3,142,605</div> related to the relative fair value of beneficial conversion features and <div style="display: inline; font-style: italic; font: inherit;">3,950,191</div> for the relative fair value of the warrants issued with each note. The fair value of warrants was derived using the Black-Scholes valuation model.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">As of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, convertible notes having a carrying value of <div style="display: inline;">$ <div style="display: inline; font-style: italic; font: inherit;">1,198,188</div></div>, net of unamortized discount of&nbsp;<div style="display: inline;">$ (<div style="display: inline; font-style: italic; font: inherit;">58,812</div>)</div> remained outstanding from the <div style="display: inline; font-style: italic; font: inherit;"> March 2017 </div>and <div style="display: inline; font-style: italic; font: inherit;"> July 2017 </div>note offerings, and accrued interest on the notes is <div style="display: inline; font-style: italic; font: inherit;">$228,052.</div> Discount amortization was <div style="display: inline; font-style: italic; font: inherit;">$96,527</div> for the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:center;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">8%</div> Senior Secured</div> <div style="display: inline; font-weight: bold;">Convertible Promissory Note dated <div style="display: inline; font-style: italic; font: inherit;"> February 28, 2019</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> February 28, 2019, </div>the Company issued a <div style="display: inline; font-style: italic; font: inherit;">$1,500,000</div> <div style="display: inline; font-style: italic; font: inherit;">8%</div> Senior Secured Convertible Promissory Note and entered into the Note Purchase Agreement and Security Agreement with CSW Ventures, L.P. (together, &#x201c;CSW Note&#x201d;). The note matures on <div style="display: inline; font-style: italic; font: inherit;"> August 28, 2020 </div>and is convertible at any time until maturity into <div style="display: inline; font-style: italic; font: inherit;">8,823,529</div> shares of the Company's common stock at <div style="display: inline; font-style: italic; font: inherit;">$0.17</div> per share. Collateral pledged as security for the note includes all of the Company's <div style="display: inline; font-style: italic; font: inherit;">100%</div> membership interests in GB Sciences, Nevada, LLC and GB Sciences Las Vegas, LLC, which together represent substantially all of the Company's cannabis cultivation and production operations and assets located at the Teco facility in Las Vegas, Nevada. The intrinsic value of the beneficial conversion feature resulting from the market price of the Company's common stock in excess of the conversion price was <div style="display: inline; font-style: italic; font: inherit;">$176,471</div> on the date of issuance, and the Company recorded a discount on the CSW Note in that amount.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> May 28, 2019, </div>the Company received notice from CSW Ventures, L.P. of the conversion of a total of <div style="display: inline; font-style: italic; font: inherit;">$170,000</div> of the principal balance of the <div style="display: inline; font-style: italic; font: inherit;">8%</div> Senior Secured Promissory Note dated <div style="display: inline; font-style: italic; font: inherit;"> February 28, 2019. </div>Accordingly, the Company issued <div style="display: inline; font-style: italic; font: inherit;">1,000,000</div> shares of its common stock based on a <div style="display: inline; font-style: italic; font: inherit;">$0.17</div> per share conversion price. In connection with the conversions, $ <div style="display: inline; font-style: italic; font: inherit;">17,225</div> in unamortized discount was recorded as interest expense and the Company reduced the carrying amount of convertible notes payable by <div style="display: inline; font-style: italic; font: inherit;">$152,775.</div> After conversion, the remaining balance outstanding was <div style="display: inline; font-style: italic; font: inherit;">$1,330,000.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: center;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> July 12, 2019, </div>the Company entered into the Amendment to Note Documents and the Amended and Restated <div style="display: inline; font-style: italic; font: inherit;">8%</div> Senior Secured Promissory Note (together, &#x201c;Amended CSW Note&#x201d;). The Amended CSW Note increased the note balance by <div style="display: inline; font-style: italic; font: inherit;">$100,000</div> to reflect an additional <div style="display: inline; font-style: italic; font: inherit;">$100,000</div> advanced to the Company on <div style="display: inline; font-style: italic; font: inherit;"> July 12, 2019, </div>by <div style="display: inline; font-style: italic; font: inherit;">$41,863</div> to add accrued interest to date to the principal balance, and decreased the conversion price to <div style="display: inline; font-style: italic; font: inherit;">$0.11</div> per share, with the remaining terms substantially unchanged from the original CSW Note.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">We evaluated the modification under the guidance in ASC <div style="display: inline; font-style: italic; font: inherit;">470</div>-<div style="display: inline; font-style: italic; font: inherit;">50</div> and determined that the amendment represents an extinguishment because the change in the fair value of the conversion feature exceeded <div style="display: inline; font-style: italic; font: inherit;">10%</div> of the carrying value of the CSW Note on the amendment date. The carrying value of the amended note on the date of extinguishment was <div style="display: inline; font-style: italic; font: inherit;">$1,338,057,</div> net of a beneficial conversion feature discount of <div style="display: inline; font-style: italic; font: inherit;">$133,806,</div> and we recorded a loss on extinguishment of <div style="display: inline; font-style: italic; font: inherit;">$124,158.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> August 1, 2019, </div>the Company received notice from CSW Ventures, L.P. of the conversion of a total of $ <div style="display: inline; font-style: italic; font: inherit;">110,000</div> of the principal balance of the Amended CSW Note at <div style="display: inline; font-style: italic; font: inherit;">$0.11</div> per share. Accordingly, the Company issued <div style="display: inline; font-style: italic; font: inherit;">1,000,000</div> shares of its common stock. In connection with the conversions, <div style="display: inline; font-style: italic; font: inherit;">$9,579</div> in unamortized discount was recorded as interest expense and the Company has reduced the carrying amount of convertible notes payable by <div style="display: inline; font-style: italic; font: inherit;">$100,421.</div> After conversion, the remaining balance outstanding was $ <div style="display: inline; font-style: italic; font: inherit;">1,361,863.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> October 23, 2019, </div>the Company entered into the Amendment to Promissory Note. The <div style="display: inline; font-style: italic; font: inherit;"> October 23, 2019 </div>amendment decreased the conversion price to <div style="display: inline; font-style: italic; font: inherit;">$0.08</div> per share, with the remaining terms substantially unchanged from the Amended CSW Note.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">We evaluated the modification under the guidance in ASC <div style="display: inline; font-style: italic; font: inherit;">470</div>-<div style="display: inline; font-style: italic; font: inherit;">50</div> and determined that the amendment represents an extinguishment because the change in the fair value of the conversion feature exceeded <div style="display: inline; font-style: italic; font: inherit;">10%</div> of the carrying value of the Amended CSW Note immediately prior to the <div style="display: inline; font-style: italic; font: inherit;">2nd</div> Amended CSW Note. The carrying value of the Amended CSW Note on the date of extinguishment was <div style="display: inline; font-style: italic; font: inherit;">$1,269,067,</div> net of a beneficial conversion feature discount of <div style="display: inline; font-style: italic; font: inherit;">$92,796,</div> and we recorded a loss on extinguishment of <div style="display: inline; font-style: italic; font: inherit;">$92,796.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> November 27, 2019, </div>the Company entered into the Second Amendment to Note Documents and the Second Amended and Restated <div style="display: inline; font-style: italic; font: inherit;">8%</div> Senior Secured Promissory Note (together, <div style="display: inline; font-style: italic; font: inherit;">&#x201c;2nd</div> Amended CSW Note&#x201d;). The <div style="display: inline; font-style: italic; font: inherit;">2nd</div> Amended CSW Note decreased the conversion price to <div style="display: inline; font-style: italic; font: inherit;">$0.04</div> per share and increased the note balance by <div style="display: inline; font-style: italic; font: inherit;">$30,000</div> to reflect an advance received on that date, with the remaining terms substantially unchanged from the Amended CSW Note.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:center;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt;">&nbsp;We evaluated the modification under the guidance in ASC <div style="display: inline; font-style: italic; font: inherit;">470</div>-<div style="display: inline; font-style: italic; font: inherit;">50</div> and determined that the <div style="display: inline; font-style: italic; font: inherit;">2nd</div> Amended CSW Note represents an extinguishment because the change in the fair value of the conversion feature exceeded <div style="display: inline; font-style: italic; font: inherit;">10%</div> of the carrying value of the Amended CSW Note immediately prior to the <div style="display: inline; font-style: italic; font: inherit;">2nd</div> Amended CSW Note; however, <div style="display: inline; font-style: italic; font: inherit;">no</div> loss on extinguishment was recorded because the net consideration paid for the <div style="display: inline; font-style: italic; font: inherit;">2nd</div> Amended CSW Note was equal to the extinguished carrying value of the Amended CSW Note. The carrying value of the Amended CSW Note on the date of extinguishment was <div style="display: inline; font-style: italic; font: inherit;">$1,361,863.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> December 16, 2019, </div>the Company received notice from CSW Ventures, L.P. of the conversion of a total of <div style="display: inline; font-style: italic; font: inherit;">$120,000</div> of the principal balance of the Amended CSW Note at <div style="display: inline; font-style: italic; font: inherit;">$0.04</div> per share and we issued <div style="display: inline; font-style: italic; font: inherit;">3,000,000</div> shares of common stock. In connection with the conversions, <div style="display: inline; font-style: italic; font: inherit;">$57,551</div> in unamortized discount was recorded as interest expense, and the Company has reduced the carrying amount of convertible notes payable by <div style="display: inline; font-style: italic; font: inherit;">$62,449.</div> After conversion, the remaining balance outstanding was <div style="display: inline; font-style: italic; font: inherit;">$1,271,863</div> and the carrying amount of the note was <div style="display: inline; font-style: italic; font: inherit;">$687,021,</div> net of <div style="display: inline; font-style: italic; font: inherit;">$584,842</div> in unamortized discount from the beneficial conversion feature.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">During the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, we recorded interest expense of <div style="display: inline; font-style: italic; font: inherit;">$252,573</div> related to the CSW Note and its amendments consisting of&nbsp;<div style="display: inline; font-style: italic; font: inherit;">$25,367</div> in accrued interest and&nbsp;<div style="display: inline; font-style: italic; font: inherit;">$227,206</div> related to amortization of the note discount. As of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, the carrying amount of the CSW Note was $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">1,089,587</div></div>, net of unamortized discount of $<div style="display: inline;">(<div style="display: inline; font-style: italic; font: inherit;">182,276</div>)</div>.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company is in default on the amended CSW Note due to non-payment of the quarterly interest payments due on <div style="display: inline; font-style: italic; font: inherit;"> October 1, 2019, </div><div style="display: inline; font-style: italic; font: inherit;"> January 1, 2020,&nbsp; </div><div style="display: inline; font-style: italic; font: inherit;"> March 1, 2020, </div>and <div style="display: inline; font-style: italic; font: inherit;"> June 1, 2020, </div>and for nonpayment of an income tax liability related to the <div style="display: inline; font-style: italic; font: inherit;"> March 31, 2018 </div>tax year. The terms of the note provide that the Company has <div style="display: inline; font-style: italic; font: inherit;">5</div> days to cure a default caused by nonpayment of interest and <div style="display: inline; font-style: italic; font: inherit;">ten</div> days to cure a default caused by noncompliance with affirmative or negative debt covenants. The lender has agreed to provide forbearance of the defaults in connection with the sale of the Teco facilities, and the Company anticipates that the CSW Note will be settled in full upon close of the sale of the Company's interests in its Nevada operations to an entity affiliated with CSW Ventures, L.P. (Note <div style="display: inline; font-style: italic; font: inherit;">11</div>).</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">8%</div> Convertible Promissory Note dated <div style="display: inline; font-style: italic; font: inherit;"> April 23, 2019</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> April 23, 2019, </div>the Company entered into the Note Purchase Agreement with Iliad Research and Trading, L.P. ("Iliad") and issued an <div style="display: inline; font-style: italic; font: inherit;">8%</div> Convertible Promissory Note with a face value of <div style="display: inline; font-style: italic; font: inherit;">$2,765,000.</div> The Note was issued with original issue discount of <div style="display: inline; font-style: italic; font: inherit;">$265,000</div> and is convertible into shares of the Company's common stock at a price of <div style="display: inline; font-style: italic; font: inherit;">$0.17</div> per share at the option of the note holder at any time until the Note is repaid. The Note matures on <div style="display: inline; font-style: italic; font: inherit;"> April 22, 2020. </div>A total discount of <div style="display: inline; font-style: italic; font: inherit;">$440,000</div> was recorded on the note, which includes <div style="display: inline; font-style: italic; font: inherit;">$265,000</div> of original issue discount and <div style="display: inline; font-style: italic; font: inherit;">$175,000</div> in fees paid to brokers.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">During the year ended <div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020, </div>the Company honored the conversion of a total of a total of <div style="display: inline; font-style: italic; font: inherit;">$125,000</div> of accrued interest on the Iliad Note at reduced conversion rates. On <div style="display: inline; font-style: italic; font: inherit;"> October 30, 2019, </div>the Company received notice of the conversion of <div style="display: inline; font-style: italic; font: inherit;">$75,000</div> at <div style="display: inline; font-style: italic; font: inherit;">$0.06</div> per share and issued <div style="display: inline; font-style: italic; font: inherit;">1,250,000</div> shares of its common stock. The fair value of the shares issued exceeded the fair value of the shares issuable under the original terms of the Note by <div style="display: inline; font-style: italic; font: inherit;">$64,706,</div> and the Company recorded an induced conversion expense. On <div style="display: inline; font-style: italic; font: inherit;"> November 18, 2019, </div>the Company received notice of the conversion of <div style="display: inline; font-style: italic; font: inherit;">$50,000</div> of the note balance at <div style="display: inline; font-style: italic; font: inherit;">$0.0375</div> per share and issued <div style="display: inline; font-style: italic; font: inherit;">1,333,333</div> shares of its common stock.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> April 22, 2020, </div>the Company failed to make payment of the principal and accrued interest due under the Iliad Note, resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by <div style="display: inline; font-style: italic; font: inherit;">10%.</div> As the result of the default, Company recorded an expense of <div style="display: inline; font-style: italic; font: inherit;">$9,559</div> related to a <div style="display: inline; font-style: italic; font: inherit;">10%</div> increase in the accrued interest balance, which is recorded in interest expense, and <div style="display: inline; font-style: italic; font: inherit;">$276,500</div> related to the <div style="display: inline; font-style: italic; font: inherit;">10%</div> increase in the principal balance, which is recorded in debt default penalty and other expense. As of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, the principal balance due under the note was $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">3,041,500</div></div>, including the <div style="display: inline; font-style: italic; font: inherit;">10%</div> penalty increase to the principal balance, and accrued interest was <div style="display: inline; font-style: italic; font: inherit;">$192,649,</div> including an increase of <div style="display: inline; font-style: italic; font: inherit;">$9,559</div> attributable to the <div style="display: inline; font-style: italic; font: inherit;">10%</div> default penalty.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">During the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, interest expense related to the note was <div style="display: inline; font-style: italic; font: inherit;">$130,659,</div> of which <div style="display: inline; font-style: italic; font: inherit;">$29,831</div> was amortization of the note discount and <div style="display: inline; font-style: italic; font: inherit;">$100,828</div> was interest accrued at the pre-default rate of <div style="display: inline; font-style: italic; font: inherit;">8.0%</div> through <div style="display: inline; font-style: italic; font: inherit;"> April 22, 2020, </div>and at the default rate of <div style="display: inline; font-style: italic; font: inherit;">15.0%</div> for the period from <div style="display: inline; font-style: italic; font: inherit;"> April 23, 2020 </div>through <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> May 20, 2020, </div>Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does <div style="display: inline; font-style: italic; font: inherit;">not</div> intend to defend the lawsuit. On <div style="display: inline; font-style: italic; font: inherit;"> July 14, 2020, </div>the Court entered judgment in favor of Iliad in the amount of <div style="display: inline; font-style: italic; font: inherit;">$3,264,594</div> and the judgment accrues interest at the default rate of <div style="display: inline; font-style: italic; font: inherit;">15%</div> per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has <div style="display: inline; font-style: italic; font: inherit;">not</div> been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC.&nbsp;</div></div> 7551 10 5 10 150000 286059 286059 286059 291660 1029003 3950191 4000 4000 9236 0.1 9559 0.1 0.1 0.15 276500 286059 1000 1000 521067 286059 164654 8000000 1957500 4991084 196 175979 176175 500 135581 136081 143599 3781101 -1895434 264662 100887 17263 74400 74400 -74400 17263 -17263 9559 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">4</div> &#x2013;&nbsp;Leases </div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company determines if an arrangement is a lease at inception and has lease agreements for warehouses, office facilities, and equipment. These commitments have remaining non-cancelable lease terms, with lease expirations which range from <div style="display: inline; font-style: italic; font: inherit;">2024</div> to <div style="display: inline; font-style: italic; font: inherit;">2025.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">As a result of the adoption of ASC <div style="display: inline; font-style: italic; font: inherit;">842,</div> certain real estate and equipment operating leases have been recorded on the balance sheet with a lease liability and right-of-use asset ("ROU"). Application of this standard resulted in the recognition of ROU assets of <div style="display: inline; font-style: italic; font: inherit;">$182,624,</div> net of accumulated amortization, and a corresponding lease liability of&nbsp;<div style="display: inline; font-style: italic; font: inherit;">$190,173</div> at the <div style="display: inline; font-style: italic; font: inherit;"> April 1, 2019, </div>the date of adoption. Accounting for finance leases is substantially unchanged.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Operating leases are included in other current assets , accrued liabilities, and operating lease obligations, long term on the unaudited condensed consolidated balance sheets. Finance leases are included in property and equipment, finance lease obligations, short term, and finance lease obligations, long term, on the unaudited condensed consolidated balance sheets. ROU assets represent the Company's right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make scheduled lease payments. ROU assets and liabilities are recognized on the lease commencement date based on the present value of lease payments over the lease term. The present value of lease payments is calculated using the incremental borrowing rate at lease commencement, which takes into consideration recent debt issuances as well as other applicable market data available. The rates used to discount finance leases previously recorded as capital leases range from <div style="display: inline; font-style: italic; font: inherit;">10.2%</div> to <div style="display: inline; font-style: italic; font: inherit;">11.5%.</div> Operating leases were discounted at a rate of <div style="display: inline; font-style: italic; font: inherit;">17.0%.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Lease terms include options to extend when it is reasonably certain that the option will be exercised. Leases with a term of <div style="display: inline; font-style: italic; font: inherit;">12</div> months or less are <div style="display: inline; font-style: italic; font: inherit;">not</div> recorded on the consolidated balance sheet.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">During the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, finance lease costs recorded in the consolidated financial statements were <div style="display: inline; font-style: italic; font: inherit;">$143,599,</div> of which&nbsp;<div style="display: inline; font-style: italic; font: inherit;">$104,924</div> represents interest expense and&nbsp;<div style="display: inline; font-style: italic; font: inherit;">$38,675</div> represents amortization of the right-of-use assets. Operating lease costs were <div style="display: inline; font-style: italic; font: inherit;">$3,243,</div> of which&nbsp;<div style="display: inline; font-style: italic; font: inherit;">$1,242</div> represents interest expense and&nbsp;<div style="display: inline; font-style: italic; font: inherit;">$2,001</div> represents amortization of the right-of-use assets.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Amortization of lease assets is included in general and administrative expenses. The future minimum lease payments of lease liabilities as of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, from continuing operations are as follows:</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px; min-width: 700px;"> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 12.4%;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Year Ending</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-style: italic; font: inherit;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Operating</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">March 31,</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Finance Leases</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Leases</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2021 (9 months)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">422,801</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">8,836</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2022</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">544,296</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">11,779</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2023</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">560,625</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">11,779</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2024</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">577,444</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">3,926</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2025</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">594,767</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Thereafter</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">3,781,101</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total minimum lease payments</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">6,481,034</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">36,320</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Less: Amount representing interest</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(2,835,211</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(8,242</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Present value of minimum lease payments</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">3,645,823</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">28,078</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Less: Current maturities of capital lease obligations</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(146,211</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(7,579</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Long-term capital lease obligations</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">3,499,612</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">20,499</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td> </tr> </table> <div style="">&nbsp;</div> </div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div></div> 15000 500000 8000000 0.08 750000 500000 P3Y <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px; min-; min-width: 700px;"> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 12.4%;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Year Ending</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-style: italic; font: inherit;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><div style="display: inline; font-weight: bold;">&nbsp;</div></td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Operating</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">March 31,</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Finance Leases</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Leases</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2021 (9 months)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">422,801</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">8,836</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2022</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">544,296</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">11,779</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2023</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">560,625</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">11,779</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2024</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">577,444</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">3,926</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">2025</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">594,767</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Thereafter</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">3,781,101</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total minimum lease payments</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">6,481,034</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">36,320</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Less: Amount representing interest</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(2,835,211</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(8,242</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Present value of minimum lease payments</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">3,645,823</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">28,078</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Less: Current maturities of capital lease obligations</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(146,211</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(7,579</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td colspan="1" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Long-term capital lease obligations</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">3,499,612</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">20,499</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td> </tr> </table></div> 1242 2 1 1 78226 500000 5224423 135000 213218 70959 3000000 0.05 0.15 0.5001 0.75 1 1 0.35 400000 40 -40 P5Y P3Y P5Y 84497 447633 109087 -5381534 3884877 2712122 2559914 192509 117967 1188938 888012 97574001 97271157 150000 150000 176402 176402 126650 130378 150000 96527 57551 227206 29831 510885 200382 153412936 158404020 14373642 14352868 7121110 7000880 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Basis of Presentation</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The accompanying unaudited interim condensed consolidated financial statements of GB Sciences, Inc. (the &#x201c;Company,&#x201d; &#x201c;We&#x201d; or &#x201c;Us&#x201d;) have been prepared in accordance with U.S. generally accepted accounting principles (&#x201c;U.S. GAAP&#x201d;) for interim financial information and with the instructions to Form <div style="display: inline; font-style: italic; font: inherit;">10</div>-Q and Article <div style="display: inline; font-style: italic; font: inherit;">8</div> of Regulations S-<div style="display: inline; font-style: italic; font: inherit;">X.</div> Accordingly, they do <div style="display: inline; font-style: italic; font: inherit;">not</div> include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the periods presented are <div style="display: inline; font-style: italic; font: inherit;">not</div> necessarily indicative of the results that <div style="display: inline; font-style: italic; font: inherit;"> may </div>be expected for the year ending <div style="display: inline; font-style: italic; font: inherit;"> March 31, 2021. </div>The balance sheet at&nbsp;<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div> has been derived from the audited financial statements at that date but does <div style="display: inline; font-style: italic; font: inherit;">not</div> include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company's annual report on Form <div style="display: inline; font-style: italic; font: inherit;">10</div>-K for the year ended <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div>.</div></div></div> 101230 151766 101230 33574 151766 227758 101230 141312 -50536 -86446 -114881 -48000 -883295 0.04 0.60 0.60 0.65 0.60 0.03 0.05 0.25 1 1 1 8002500 79547077 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">8</div> &#x2013; Commitments and Contingencies</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> September 18, 2017 </div>GB Sciences finalized its agreement with Louisiana State University (&#x201c;LSU&#x201d;) AgCenter to be the sole operator of the LSU's medical marijuana program. The LSU Board of Supervisors entered into a <div style="display: inline; font-style: italic; font: inherit;">five</div>-year agreement that has an option to renew for <div style="display: inline; font-style: italic; font: inherit;">two</div> additional <div style="display: inline; font-style: italic; font: inherit;">five</div>-year terms with GB Sciences.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The contract includes the Company's commitment to make an annual research investments of <div style="display: inline; font-style: italic; font: inherit;">$500,000</div> to the LSU AgCenter. The Company retained its <div style="display: inline; font-style: italic; font: inherit;">50%</div> interest in the research relationship with LSU after the sale of its membership interest in GB Sciences Louisiana, LLC (Note <div style="display: inline; font-style: italic; font: inherit;">10</div>), and accordingly remains obligated for <div style="display: inline; font-style: italic; font: inherit;">$250,000</div> of the <div style="display: inline; font-style: italic; font: inherit;">$500,000</div> annual research investment for <div style="display: inline; font-style: italic; font: inherit;">three</div> years, or a total commitment of <div style="display: inline; font-style: italic; font: inherit;">$750,000.</div> The research investment is paid annually in <div style="display: inline; font-style: italic; font: inherit;"> September </div>and amortized over a <div style="display: inline; font-style: italic; font: inherit;">one</div>-year period. On <div style="display: inline; font-style: italic; font: inherit;"> August 4, 2020, </div>the Company received its <div style="display: inline; font-style: italic; font: inherit;">first</div> payment under the Wellcana Note Receivable, net of the <div style="display: inline; font-style: italic; font: inherit;">$250,000</div> research contribution due for the <div style="display: inline; font-style: italic; font: inherit;">twelve</div> month period ended <div style="display: inline; font-style: italic; font: inherit;"> September 30, 2020, </div>and our commitment for that <div style="display: inline; font-style: italic; font: inherit;">twelve</div> month period was paid by the purchaser with the funds withheld from the note payment. The monetary contributions will be used to conduct research on plant varieties, compounds, extraction techniques and delivery methods that could generate additional revenue through discoveries that are subject to intellectual property rights, of which AgCenter would retain <div style="display: inline; font-style: italic; font: inherit;">50%</div> of those rights with the other <div style="display: inline; font-style: italic; font: inherit;">50%</div> retained <div style="display: inline; font-style: italic; font: inherit;">25%</div> each by the Company and by GB Sciences Louisiana, LLC.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> August 24, 2020, </div>the Company entered into a letter of intent with the purchaser to discount the note receivable in exchange for accelerated payment. Pursuant to the letter of intent, the purchaser will assume the annual <div style="display: inline; font-style: italic; font: inherit;">$250,000</div> research contribution commitment to LSU and the Company will retain <div style="display: inline; font-style: italic; font: inherit;">no</div> rights in the intellectual property developed under the research relationship (Note <div style="display: inline; font-style: italic; font: inherit;">10</div>).</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Tara &#x201c;Dee&#x201d; Russell filed a Charge of Discrimination with the Nevada Equal Rights Commission ("NERC") against the Company on <div style="display: inline; font-style: italic; font: inherit;"> April 2, 2019, </div>alleging that she was subjected to sexual harassment and retaliatory discharge. The Company received the Notice of Charge of Discrimination on or about <div style="display: inline; font-style: italic; font: inherit;"> May 15, 2019. </div>The Company submitted its response to the Notice of Discrimination Charge on <div style="display: inline; font-style: italic; font: inherit;"> July 26, 2019. </div>It is the Company's position that Ms. Russel was <div style="display: inline; font-style: italic; font: inherit;">not</div> an employee of the Company, but rather was an independent contractor. The Company intends to aggressively respond to the charge. To date, the NERC has <div style="display: inline; font-style: italic; font: inherit;">not</div> issued a ruling regarding the charge.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> April 22, 2020, </div>the Company failed to repay any of the outstanding balance of the Convertible Promissory Note Payable to Iliad Research and Trading, L.P. (Note <div style="display: inline; font-style: italic; font: inherit;">6</div>), resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by <div style="display: inline; font-style: italic; font: inherit;">10%</div> and the Company recorded expense of <div style="display: inline; font-style: italic; font: inherit;">$286,059</div> related to the default. As of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, the total balance due under the note was <div style="display: inline; font-style: italic; font: inherit;">$3,234,149</div> including accrued interest of <div style="display: inline; font-style: italic; font: inherit;">$192,649.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> May 20, 2020, </div>Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does <div style="display: inline; font-style: italic; font: inherit;">not</div> intend to defend the lawsuit. On <div style="display: inline; font-style: italic; font: inherit;"> July 14, 2020, </div>the Court entered judgment in favor of Iliad in the amount of <div style="display: inline; font-style: italic; font: inherit;">$3,264,594</div> and the judgment accrues interest at the default rate of <div style="display: inline; font-style: italic; font: inherit;">15%</div> per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has <div style="display: inline; font-style: italic; font: inherit;">not</div> been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC.&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> April 22, 2020, </div>the Company was served notice of a lawsuit filed in the Eighth Judicial District Court in Clark County, Nevada, filed by a contractor who had been hired to perform architectural and design services. The lawsuit demands payment of <div style="display: inline; font-style: italic; font: inherit;">$73,050</div> for the services provided. The Company intends to negotiate a settlement and the full amount demanded in the lawsuit of <div style="display: inline; font-style: italic; font: inherit;">$73,050</div> is accrued in accounts payable as of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">From time to time, the Company <div style="display: inline; font-style: italic; font: inherit;"> may </div>become involved in certain legal proceedings and claims which arise in the ordinary course of business. In management's opinion, based on consultations with outside counsel, the results of any of these ordinary course matters, individually and in the aggregate, are <div style="display: inline; font-style: italic; font: inherit;">not</div> expected to have a material effect on our results of operations, financial condition, or cash flows. As more information becomes available, if management should determine that an unfavorable outcome is probable on such a claim and that the amount of such probable loss that it will incur on that claim is reasonably estimable, the Company would record a reserve for the claim in question. If and when the Company records such a reserve, it could be material and could adversely impact its results of operations, financial condition, and cash flows.</div></div> 0.0001 0.0001 600000000 600000000 250000000 400000000 600000000 280532686 275541602 280532686 275541602 28054 27554 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Principles of Consolidation</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">We prepare our consolidated financial statements in accordance with generally accepted accounting principles (GAAP) for the United States of America. Our consolidated financial statements include all operating divisions and majority-owned subsidiaries, reported as a single operating segment, for which we maintain controlling interests. Intercompany accounts and transactions have been eliminated in consolidation. The ownership interest of non-controlling participants in subsidiaries that are <div style="display: inline; font-style: italic; font: inherit;">not</div> wholly owned is included as a separate component of equity. The non-controlling participants' share of the net loss is included as &#x201c;Net loss attributable to non-controlling interest&#x201d; on the unaudited consolidated statements of operations.</div></div></div> 491795 491795 624369 624369 491795 624369 170000 1000000 1000000 3000000 1250000 1333333 170000 110000 120000 125000 75000 50000 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">5</div> &#x2013; Notes Payable and Line of Credit</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">0%</div> Note Payable dated <div style="display: inline; font-style: italic; font: inherit;"> October 23, 2017</div></div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> October 23, 2017, </div>the Company amended the existing Nevada Medical Marijuana Production License Agreement (&#x201c;Amended Production License Agreement&#x201d;). Per the terms of the Amended Production License Agreement, GB Sciences purchased the remaining percentage of the production license resulting in the <div style="display: inline; font-style: italic; font: inherit;">100%</div> ownership of the license. GB Sciences also received <div style="display: inline; font-style: italic; font: inherit;">100%</div> ownership of the cultivation license included in the original Nevada Medical Marijuana Production License Agreement. In exchange, GB Sciences made <div style="display: inline; font-style: italic; font: inherit;">one</div>-time&nbsp;payment of <div style="display: inline; font-style: italic; font: inherit;">$500,000</div> and issued a <div style="display: inline; font-style: italic; font: inherit;">0%</div> Promissory Note in the amount of <div style="display: inline; font-style: italic; font: inherit;">$700,000</div> payable in equal monthly payments over a <div style="display: inline; font-style: italic; font: inherit;">three</div>-year period commencing on <div style="display: inline; font-style: italic; font: inherit;"> January 1, 2018.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The present value of the note was <div style="display: inline; font-style: italic; font: inherit;">$521,067</div> on the date of its issuance based on an imputed interest rate of <div style="display: inline; font-style: italic; font: inherit;">20.3%</div> and the Company recorded a discount on notes payable of <div style="display: inline; font-style: italic; font: inherit;">$178,933.</div> During the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, the Company recorded interest expense of <div style="display: inline; font-style: italic; font: inherit;">$7,321</div> related to amortization of the note discount. The remaining unamortized discount as of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div> was $<div style="display: inline;">(<div style="display: inline; font-style: italic; font: inherit;">6,607</div>)</div>.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company has been in default on this note since <div style="display: inline; font-style: italic; font: inherit;"> June </div>of <div style="display: inline; font-style: italic; font: inherit;">2019,</div> and as of the date of this report, <div style="display: inline; font-style: italic; font: inherit;">fifteen</div> monthly payments on the note totaling <div style="display: inline; font-style: italic; font: inherit;">$291,660</div> are unpaid. As the result of the default, the Company has accrued penalty interest at the rate of <div style="display: inline; font-style: italic; font: inherit;">10%</div> according to the terms of the Promissory Note. Total penalty interest accrued was <div style="display: inline; font-style: italic; font: inherit;">$9,236</div> for the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>. If the Company is unable to cure the default within <div style="display: inline; font-style: italic; font: inherit;">ten</div> days of receiving a written notice, the lender will have the option to accelerate the remaining balance owed of $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">369,445</div></div>, but must notify the Company in writing should it choose to do so. The Company is currently in the process of negotiating a settlement and/or forbearance agreement with the lender and anticipates repayment of the note upon receiving proceeds from the sales of the Company's Teco and Nopah facilities (Note <div style="display: inline; font-style: italic; font: inherit;">11</div>).</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">8%</div> Line of Credit dated <div style="display: inline; font-style: italic; font: inherit;"> November 27, 2019</div></div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">In connection with the Binding Letter of Intent dated <div style="display: inline; font-style: italic; font: inherit;"> November 27, 2019 (</div>Note <div style="display: inline; font-style: italic; font: inherit;">11</div>), the Company entered into a promissory note and received a line of credit for up to <div style="display: inline; font-style: italic; font: inherit;">$470,000</div> from the purchaser of the Company's membership interest in its Nevada facilities. The purpose of the line of credit is to supply working capital for the Nevada operations. The note matures upon the close of the sale of membership interests. As of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, the Company has received $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">485,000</div></div> in advances under the line of credit, reflecting an informal agreement with the lender to increase the Line of Credit limit by <div style="display: inline; font-style: italic; font: inherit;">$15,000.</div> The Company accrued interest of <div style="display: inline; font-style: italic; font: inherit;">$9,641</div> on the line of credit for the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, and the balance of the line of credit was $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">485,000</div></div> at <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>. Upon the close of the sale of the Teco Facility all principal and interest due under the line of credit will be considered satisfied in full.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">8%</div> Note Payable dated <div style="display: inline; font-style: italic; font: inherit;"> May 7, 2020</div></div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> May 7, 2020, </div>the Company received <div style="display: inline; font-style: italic; font: inherit;">$135,000</div> cash from an investor, net of $(<div style="display: inline; font-style: italic; font: inherit;">15,000</div>) in brokerage fees, and issued a <div style="display: inline; font-style: italic; font: inherit;">$150,000</div> promissory note. The note bears interest at a rate of <div style="display: inline; font-style: italic; font: inherit;">8.0%</div> per annum. The note is to be repaid upon the <div style="display: inline; font-style: italic; font: inherit;">first</div> proceeds received from the <div style="display: inline; font-style: italic; font: inherit;">$8,000,000</div> promissory note related to the sale of the Company's membership interest in GB Sciences Louisiana, LLC (Note <div style="display: inline; font-style: italic; font: inherit;">10</div>), or from the proceeds of the sale of the Teco Facility (Note <div style="display: inline; font-style: italic; font: inherit;">11</div>). As inducement to enter into the note transaction, the Company repriced <div style="display: inline; font-style: italic; font: inherit;">8,002,500</div> preexisting warrants held by the investor to an exercise price of <div style="display: inline; font-style: italic; font: inherit;">$0.04.</div> The repriced warrants were valued at <div style="display: inline; font-style: italic; font: inherit;">$272,085</div> on the date of the transaction using the Black-Scholes Model, which exceeded the value of the warrants prior to the price reduction of <div style="display: inline; font-style: italic; font: inherit;">$49,525</div> by <div style="display: inline; font-style: italic; font: inherit;">$222,560.</div> As the result of the increase in the estimated fair value of the warrants, the Company recorded a full discount on notes payable of $(<div style="display: inline; font-style: italic; font: inherit;">150,000</div>). During the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, the Company recorded interest expense of <div style="display: inline; font-style: italic; font: inherit;">$151,742</div> related to the note consisting of accrued interest of <div style="display: inline; font-style: italic; font: inherit;">$1,742</div> and <div style="display: inline; font-style: italic; font: inherit;">$150,000</div> related to amortization of the note discount. Unamortized discount remaining at <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div> was <div style="display: inline; font-style: italic; font: inherit;">$0.</div></div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:center;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Summary of Notes Payable</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">As of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, the following notes payable were recorded in the Company's consolidated balance sheet:</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin-bottom:0pt;margin-left:0pt;margin-right:7.2pt;margin-top:0pt;text-align:left;">&nbsp;</div> <div> <table style="; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px; min-width: 700px;" cellspacing="0" cellpadding="0" border="0"> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="10" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">As of June 30, 2020</div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 55%;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Short-Term Notes Payable</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Face Value</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Discount</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Carrying Value</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">6% Convertible promissory notes payable (Note 6)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,257,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(58,812</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,198,188</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">8% Convertible Secured Promissory Note dated February 28, 2019, as amended (Note 6)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,271,863</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(182,276</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,089,587</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">8% Convertible Promissory Note dated April 23, 2019 (Note 6)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">3,041,500</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">3,041,500</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">0% Note Payable dated October 23, 2017 (Note 5)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">369,445</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(6,607</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">362,838</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">8% Line of Credit dated November 27, 2019 (Note 5)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">485,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">485,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">8% Note Payable dated May 7, 2020 (Note 5)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">150,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">150,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total Short-Term Notes Payable</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">6,574,808</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(247,695</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">6,327,113</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> </table> </div></div> 1198188 687021 1089587 3041500 904690 3142605 176471 133806 92796 0.25 0.25 0.17 0.17 0.11 0.11 0.08 0.04 0.04 0.17 0.06 0.0375 4000 8000000 4000 28804000 8823529 324423 700000 150000 2000000 7201000 1500000 2765000 1257000 1271863 3041500 369445 485000 150000 6574808 41863 -152775 100000 -100421 30000 -62449 0 0.08 0.06 0.06 0.08 0.08 0.08 0.08 0.08 0.15 0.08 0.08 P3Y P3Y P3Y P3Y 178933 6607 150000 0 1933693 7092796 58812 17225 9579 584842 182276 265000 58812 182276 6607 247695 440000 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Beneficial Conversion Feature of Convertible Notes Payable</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company accounts for convertible notes payable in accordance with the guidelines established by the Financial Accounting Standards Board's (&#x201c;FASB&#x201d;) Accounting Standards Codification (&#x201c;ASC&#x201d;) Topic <div style="display: inline; font-style: italic; font: inherit;">470</div>-<div style="display: inline; font-style: italic; font: inherit;">20,</div>&nbsp;Debt with Conversion and Other Options and Emerging Issues Task Force (&#x201c;EITF&#x201d;) <div style="display: inline; font-style: italic; font: inherit;">00</div>-<div style="display: inline; font-style: italic; font: inherit;">27,</div>&nbsp;&#x201c;Application of Issue <div style="display: inline; font-style: italic; font: inherit;">No.</div> <div style="display: inline; font-style: italic; font: inherit;">98</div>-<div style="display: inline; font-style: italic; font: inherit;">5</div> to Certain Convertible Instruments&#x201d;. &nbsp;A beneficial conversion feature (&#x201c;BCF&#x201d;) exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after <div style="display: inline; font-style: italic; font: inherit;">first</div> considering the allocation of a portion of the note proceeds to the fair value of any attached equity instruments, if any related equity instruments were granted with the debt. In accordance with this guidance, the BCF of a convertible note is measured by allocating a portion of the note's proceeds to the warrants, if applicable, and as a reduction of the carrying amount of the convertible note equal to the intrinsic value of the conversion feature, both of which are credited to additional paid-in-capital. The Company calculates the fair value of warrants issued with the convertible notes using the Black-Scholes valuation model and uses the same assumptions for valuing any employee options in accordance with ASC Topic <div style="display: inline; font-style: italic; font: inherit;">718</div> Compensation &#x2013;&nbsp;Stock Compensation. The only difference is that the contractual life of the warrants is used.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The value of the proceeds received from a convertible note is then allocated between the conversion features and warrants on a relative fair value basis. The allocated fair value is recorded in the financial statements as a debt discount (premium) from the face amount of the note and such discount is amortized over the expected term of the convertible note (or to the conversion date of the note, if sooner) and is charged to interest expense.</div></div></div> 91504 91504 13028 99485 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Discontinued Operations</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Discontinued operations comprise those activities that were disposed of during the period or which were classified as held for sale at the end of the period and represent a separate major line of business or geographical area that can be clearly distinguished for operational and financial reporting purposes.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">There were <div style="display: inline; font-style: italic; font: inherit;">no</div> assets or liabilities of discontinued operations included in the Company's condensed consolidated balance sheets as of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div> and <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div>.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The revenues and expenses associated with discontinued operations included in our condensed consolidated statements of operations for the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020 </div>and <div style="display: inline; font-style: italic; font: inherit;">2019</div></div> were as follows:</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div> <div> <table style="; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px; min-width: 700px;" cellspacing="0" cellpadding="0" border="0"> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="22" rowspan="1" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">For the Three Months Ended June 30,</div></div></div></div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="10" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">2020</div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="10" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">2019</div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Continuing</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Discontinued</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Total</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Continuing</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Discontinued</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Total</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 28%;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Sales revenue</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">551,197</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">551,197</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">910,676</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">910,676</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Cost of goods sold</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(491,795</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(491,795</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(624,369</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(624,369</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Gross profit</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">59,402</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">59,402</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">286,307</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">286,307</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">General and administrative expenses</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">804,708</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">804,708</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">2,065,549</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">201,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">2,267,389</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">LOSS FROM OPERATIONS</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(745,306</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(745,306</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,779,242</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(201,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,981,082</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">OTHER EXPENSE</div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Interest expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(795,313</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(795,313</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(437,815</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(62,594</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(500,409</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">Debt default penalty</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">(286,059</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">(286,059</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Other expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(11,182</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(11,182</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 18pt;">Total other expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,092,554</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,092,554</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(437,815</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(62,594</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(500,409</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">LOSS BEFORE INCOME TAXES</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(1,837,860</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(1,837,860</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(2,217,057</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(264,434</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(2,481,491</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Income tax expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(8,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(8,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(57,392</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(57,392</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">NET LOSS</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(1,846,700</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">-</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(1,846,700</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(2,274,449</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(264,434</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(2,538,883</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> </tr> </table> </div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:center;">&nbsp;</div></div></div> 107738 712176 586512 712176 189423 -0.01 -0.01 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Earnings/(loss) per Share</div></div>&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company's basic loss per share has been calculated using the weighted average number of common shares outstanding during the period. The Company had <div style="display: inline; font-style: italic; font: inherit;">153,412,936</div> and <div style="display: inline; font-style: italic; font: inherit;">158,404,020</div> potentially dilutive common shares at&nbsp;<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div> and <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div>, respectively. However, such common stock equivalents were <div style="display: inline; font-style: italic; font: inherit;">not</div> included in the computation of diluted net loss per share as their inclusion would have been anti-dilutive.</div></div></div> 222560 104924 3645823 146211 166769 3499612 3533090 6481034 544296 594767 577444 560625 422801 2835211 38675 15344 12287 1776045 1699966 -124158 -92796 0 804708 804708 2065549 201840 2267389 804708 2065549 59402 59402 286307 286307 59402 286307 0 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Long-Lived Assets</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Property and equipment comprise a significant portion of our total assets. We evaluate the carrying value of property and equipment if impairment indicators are present or if other circumstances indicate that impairment <div style="display: inline; font-style: italic; font: inherit;"> may </div>exist under authoritative guidance. The annual testing date is <div style="display: inline; font-style: italic; font: inherit;"> March 31. </div>When management believes impairment indicators <div style="display: inline; font-style: italic; font: inherit;"> may </div>exist, projections of the undiscounted future cash flows associated with the use of and eventual disposition of property and equipment are prepared. If the projections indicate that the carrying value of the property and equipment are <div style="display: inline; font-style: italic; font: inherit;">not</div> recoverable, we reduce the carrying values to fair value. These impairment tests are heavily influenced by assumptions and estimates that are subject to change as additional information becomes available.&nbsp;<div style="display: inline; font-style: italic; font: inherit;">No</div> indicators of impairment were identified by the Company as of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>.</div></div></div> -1846700 -2274449 -1837860 -1837860 -2217057 -264434 -2481491 -1837860 -2217057 -1846700 -2274449 -0.01 -0.01 -264434 8840 8840 57392 57392 8840 57392 72280 -222008 70814 -126579 8840 -8762 125664 247549 86719 -64602 311887 -3828 -192733 64706 151742 795313 795313 437815 62594 500409 795313 437815 7321 252573 130659 1742 25367 100828 17225 228052 654760 397652 9641 192649 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">3</div> &#x2013;&nbsp;Inventory</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Raw materials consist of supplies, materials, and consumables used in the cultivation and extraction processes. Work-in-progress includes live plants and cannabis in the drying, curing, and trimming processes. Finished goods includes completed cannabis flower, trim, and extracts in bulk and packaged forms.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div> <div> <table border="0" cellpadding="0" cellspacing="0" style="; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px; min-width: 700px;"> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">June 30, 2020</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">March 31, 2020</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 70%;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Raw materials</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">129,133</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">91,465</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Work in progress</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">923,737</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,166,511</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Finished goods</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">619,491</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">466,319</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Subtotal</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,672,361</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,724,295</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Allowance to reduce inventory to net realizable value</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(126,470</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(278,456</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Total inventory, net</div></div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">1,545,891</div></div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">1,445,839</div></div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td> </tr> </table> </div></div> 619491 466319 1672361 1724295 1545891 1445839 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Inventory</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">We value our inventory at the lower of the actual cost of our inventory, as determined using the <div style="display: inline; font-style: italic; font: inherit;">first</div>-in, <div style="display: inline; font-style: italic; font: inherit;">first</div>-out method, or its current estimated net realizable value. We periodically review our physical inventory for excess, obsolete, and potentially impaired items and reserve accordingly. Our reserve estimate for excess and obsolete inventory is based on expected future use.</div></div></div> 129133 91465 126470 278456 923737 1166511 0.102 0.115 0.17 36320 11779 3926 11779 8836 8242 16022755 14441362 14373642 14352868 12502644 10885757 485000 470000 470000 500000 500000 3264594 3234149 73050 73050 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">10</div> &#x2013; Sale of Membership Interests in GB Sciences Louisiana, LLC</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> February 12, 2018, </div>the Company's wholly-owned subsidiary, GB Sciences Louisiana, LLC (&#x201c;GBSLA"), issued members' equity interests equal to <div style="display: inline; font-style: italic; font: inherit;">15%</div> in GBSLA to Wellcana Group, LLC (&#x201c;Wellcana&#x201d;) for <div style="display: inline; font-style: italic; font: inherit;">$3</div> million. Under the GBSLA operating agreement, Wellcana had an option to make additional capital contributions for the purchase of up to an additional <div style="display: inline; font-style: italic; font: inherit;">35%</div> membership interest in GBSLA, at the rate of <div style="display: inline; font-style: italic; font: inherit;">5%</div> membership interest per <div style="display: inline; font-style: italic; font: inherit;">$1</div> million contributed. To date, Wellcana has made additional cash contributions of <div style="display: inline; font-style: italic; font: inherit;">$7.0</div> million and its non-controlling interest in GBSLA increased to <div style="display: inline; font-style: italic; font: inherit;">49.99%.</div> The capital contributions were used to fund the buildout of the Petroleum Drive facility and to pay for the operating costs of GBSLA.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> November 15, 2019, </div>the Company entered into the Membership Interest Purchase Agreement ("MIPA") with Wellcana Plus, LLC ("Purchaser"), an affiliate of Wellcana Group, LLC. In consideration for the sale of its remaining <div style="display: inline; font-style: italic; font: inherit;">50.01%</div> membership interest in GBSLA, the Company received the <div style="display: inline; font-style: italic; font: inherit;">$8,000,000</div> Promissory Note&nbsp; ("Wellcana Note") and <div style="display: inline; font-style: italic; font: inherit;"> may </div>receive up to an additional <div style="display: inline; font-style: italic; font: inherit;">$8,000,000</div> in earn-out payments.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> August 24, 2020, </div>the Company entered into a letter of intent with Wellcana to discount the note receivable in exchange for accelerated payment. Pursuant to the letter of intent, the Company will receive payments totaling <div style="display: inline; font-style: italic; font: inherit;">$5,224,423,</div> including the forgiveness by Wellcana of <div style="display: inline; font-style: italic; font: inherit;">$324,423</div> in liabilities and the payment of <div style="display: inline; font-style: italic; font: inherit;">$4,900,000</div> in cash, on or before <div style="display: inline; font-style: italic; font: inherit;"> October 15, 2020, </div>less any cash payments made by Wellcana up to the date of the final payment. Upon receipt of the payment, all liabilities owed to the Company by Wellcana, including the <div style="display: inline; font-style: italic; font: inherit;">$8,000,000</div> note receivable and any potential earn-out payments will be considered satisfied in full. Wellcana will assume the annual <div style="display: inline; font-style: italic; font: inherit;">$250,000</div> research contribution commitment to LSU (Note <div style="display: inline; font-style: italic; font: inherit;">8</div>) and the Company will retain <div style="display: inline; font-style: italic; font: inherit;">no</div> rights in the intellectual property developed under the research relationship. In addition, the Company agreed to reduce the <div style="display: inline; font-style: italic; font: inherit;">$750,000</div> note payment due on <div style="display: inline; font-style: italic; font: inherit;"> September 1, 2020 </div>to <div style="display: inline; font-style: italic; font: inherit;">$500,000.</div> Should Wellcana fail to make the <div style="display: inline; font-style: italic; font: inherit;">$4,900,000</div> payment, less any offsets from payments made to date on the note receivable, the term sheet will be void and the original terms of the Membership Interest Purchase Agreement and <div style="display: inline; font-style: italic; font: inherit;">$8,000,000</div> note receivable will prevail.</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">As a result of the <div style="display: inline; font-style: italic; font: inherit;"> August 24, 2020 </div>letter of intent, the Company determined that the amount of the note that was collectible as of&nbsp;<div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020 </div>was $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">5,224,423</div></div> and recorded a loss on modification of note receivable of <div style="display: inline; font-style: italic; font: inherit;">$1,895,434</div> for the year ended <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div>. As of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, the balance of the note receivable was $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">5,224,423</div></div>.</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">The Company granted forbearance of the <div style="display: inline; font-style: italic; font: inherit;"> June 1, 2020 </div>payment from Wellcana in light of the circumstances created by the COVID-<div style="display: inline; font-style: italic; font: inherit;">19</div> epidemic. The payment was received by the Company on <div style="display: inline; font-style: italic; font: inherit;"> August 4, 2020, </div>net of the Company's <div style="display: inline; font-style: italic; font: inherit;">$250,000</div> research contribution commitment to LSU for the <div style="display: inline; font-style: italic; font: inherit;">twelve</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> September 2020 (</div>Note <div style="display: inline; font-style: italic; font: inherit;">8</div>) and the principal and accrued interest payable to John Davis (Note <div style="display: inline; font-style: italic; font: inherit;">5</div>) totaling <div style="display: inline; font-style: italic; font: inherit;">$189,423</div> as of the date of payment.</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">For all periods presented in the unaudited financial statements, the assets, liabilities, income, and cash flows of GBSLA have been reclassified to discontinued operations.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">11</div> &#x2013; Sale of Membership Interests in Nevada Subsidiaries</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> November 15, 2019, </div>we entered into a Binding Letter of Intent ("Teco LOI") to sell <div style="display: inline; font-style: italic; font: inherit;">75%</div> of the Company's membership interest interests in GB Sciences Nevada, LLC, and GB Sciences Las Vegas, LLC, for <div style="display: inline; font-style: italic; font: inherit;">$3.0</div> million cash upon close and up to an additional <div style="display: inline; font-style: italic; font: inherit;">$3.0</div> million in earn-out payments after close. In connection with the Teco LOI, we entered into a Management Agreement with the purchaser whereby the facilities will be managed by an affiliate of the purchaser until the close of the sale. As part of the transaction, the Company also entered into a Line of Credit of up to <div style="display: inline; font-style: italic; font: inherit;">$470,000</div> with the purchaser (Note <div style="display: inline; font-style: italic; font: inherit;">5</div>) to fund the operations of Teco. The line of credit accrues interest at a rate of <div style="display: inline; font-style: italic; font: inherit;">8%</div> and the Company pledged its interest in the Teco facilities as collateral for the note, subject to the preexisting lien held by CSW Ventures, L.P. in connection with the <div style="display: inline; font-style: italic; font: inherit;">8%</div> Senior Secured Convertible Promissory Note dated <div style="display: inline; font-style: italic; font: inherit;"> February 28, 2019 (</div>Note <div style="display: inline; font-style: italic; font: inherit;">6</div>). The Line of Credit will be considered satisfied in full upon close of the sale of the Teco Facility.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> March 24, 2020, </div>we entered into the Membership Interest Purchase Agreement ("Teco MIPA") which formalized the sale of the Teco Subsidiaries and modified the terms of the sale. Pursuant to the Teco MIPA, the Company will sell <div style="display: inline; font-style: italic; font: inherit;">100%</div> of its membership interests in GBSN and GBLV for <div style="display: inline; font-style: italic; font: inherit;">$4,000,000</div> cash upon close and will receive a <div style="display: inline; font-style: italic; font: inherit;">$4,000,000</div> <div style="display: inline; font-style: italic; font: inherit;">8%</div> promissory note to be paid in monthly installments over <div style="display: inline; font-style: italic; font: inherit;">36</div> months.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> July 24, 2020, </div>the Company entered into the Loan Agreement, <div style="display: inline; font-style: italic; font: inherit;">8%</div> Secured Promissory Note, and Security Agreement (together, the <div style="display: inline; font-style: italic; font: inherit;"> "July 24 </div>Note") with AJE Management, LLC, which established a revolving loan of up to <div style="display: inline; font-style: italic; font: inherit;">$500,000</div> that the Company <div style="display: inline; font-style: italic; font: inherit;"> may </div>draw on from time to time. The loan is collateralized by the Teco Facility, subject to the preexisting lien held by CSW Ventures, L.P. in connection with the <div style="display: inline; font-style: italic; font: inherit;">8%</div> Senior Secured Convertible Promissory Note dated <div style="display: inline; font-style: italic; font: inherit;"> February 28, 2019 (</div>Note <div style="display: inline; font-style: italic; font: inherit;">6</div>). Any advances will be made at the sole discretion of the lender following a written request made by the Company. Contemporaneously with the Loan Agreement, the Company and AJE Management entered into the Amendment to the Membership Interest Purchase Agreement with AJE Management. The amendment provides that any balances outstanding under the <div style="display: inline; font-style: italic; font: inherit;"> July 24 </div>Note at the time of the close of the sale of the Teco Facility will be forgiven in exchange for a reduction to the <div style="display: inline; font-style: italic; font: inherit;">$4,000,000</div> note receivable that the Company will receive as consideration for the sale of the Teco Facility. The reduction to the note receivable will be equal to <div style="display: inline; font-style: italic; font: inherit;">3</div> times the balance outstanding under the <div style="display: inline; font-style: italic; font: inherit;"> July 24 </div>Note on the date of the close of the sale of the Teco Facility. As of the date of this report, the Company has <div style="display: inline; font-style: italic; font: inherit;">not</div> received any advances under the <div style="display: inline; font-style: italic; font: inherit;"> July 24 </div>Note.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The sale is expected to close upon the successful transfer of the Nevada cultivation and production licenses. The transfer of cannabis licenses in the State of Nevada has been subject to an indefinite moratorium since <div style="display: inline; font-style: italic; font: inherit;"> October 2019. </div>In a meeting held on <div style="display: inline; font-style: italic; font: inherit;"> July 21, 2020, </div>the Nevada Cannabis Compliance Board lifted the moratorium, however, the board has indicated that there are over <div style="display: inline; font-style: italic; font: inherit;">90</div> requests pending and it will take up to several months to process the entire backlog of pending license transfers. Based on this information, we cannot provide any assurances as to the timing of the close of the sale. The lifting of the moratorium and processing of cannabis license transfers have been delayed by the COVID-<div style="display: inline; font-style: italic; font: inherit;">19</div> pandemic and could be further delayed if the pandemic continues.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company also holds a Nevada license for cultivation of medical marijuana located in Sandy Valley, Nevada (the &#x201c;Nopah License&#x201d;). The license is owned by the Company's wholly owned subsidiary, GB Sciences Nopah, LLC ("Nopah"). Operations have <div style="display: inline; font-style: italic; font: inherit;">not</div> begun under the Nopah License. On <div style="display: inline; font-style: italic; font: inherit;"> November 27, 2019, </div>the Company entered into a Binding Letter of Intent to sell its <div style="display: inline; font-style: italic; font: inherit;">100%</div> interest in GB Sciences Nopah, LLC (the &#x201c;Nopah LOI&#x201d;), with the transaction closing upon transfer of the Nopah License. As consideration for the transfer of the license, the Company will receive <div style="display: inline; font-style: italic; font: inherit;">$300,000</div> and the purchaser will pay all expenses related to the upkeep and maintenence of the Nopah License. The transfer of the Nopah License is subject to the same restrictions on license transfers discussed above.</div></div> 0.4999 1 273309 2802349 273309 2917230 -257674 -209674 -323845 -2631121 -323845 -1747826 -2406667 -2406667 -1846700 -1846700 -132216 -132216 -1846700 -2406667 -1846700 -2274449 -132218 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Recent Accounting Pronouncements</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;">Recently Adopted Standards</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">In <div style="display: inline; font-style: italic; font: inherit;"> June 2016, </div>the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") <div style="display: inline; font-style: italic; font: inherit;">No.</div> <div style="display: inline; font-style: italic; font: inherit;">2016</div>-<div style="display: inline; font-style: italic; font: inherit;">13,</div> "Financial Instruments&#x2014;Credit Losses (Topic <div style="display: inline; font-style: italic; font: inherit;">326</div>): Measurement of Credit Losses on Financial Instruments" ("ASU <div style="display: inline; font-style: italic; font: inherit;">2016</div>-<div style="display: inline; font-style: italic; font: inherit;">13"</div>).&nbsp; Financial Instruments&#x2014;Credit Losses (Topic <div style="display: inline; font-style: italic; font: inherit;">326</div>) amends guideline on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities.&nbsp; For assets held at amortized cost basis, Topic <div style="display: inline; font-style: italic; font: inherit;">326</div> eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses.&nbsp; The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected.&nbsp; For available-for-sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic <div style="display: inline; font-style: italic; font: inherit;">326</div> will require that credit losses be presented as an allowance rather than as a write-down.&nbsp; ASU <div style="display: inline; font-style: italic; font: inherit;">2016</div>-<div style="display: inline; font-style: italic; font: inherit;">13</div> affects entities holding financial assets and net investment in leases that are <div style="display: inline; font-style: italic; font: inherit;">not</div> accounted for at fair value through net income.&nbsp; The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets <div style="display: inline; font-style: italic; font: inherit;">not</div> excluded from the scope that have the contractual right to receive cash.&nbsp; The amendments in this ASU are effective for smaller reporting companies for fiscal years beginning after <div style="display: inline; font-style: italic; font: inherit;"> December 15, 2022, </div>including interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on its financial statements.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">In <div style="display: inline; font-style: italic; font: inherit;"> August 2018, </div>the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) <div style="display: inline; font-style: italic; font: inherit;">2018</div>-<div style="display: inline; font-style: italic; font: inherit;">13,</div> &#x201c;<div style="display: inline; font-style: italic;">Fair Value Measurement (Topic <div style="display: inline; font-style: italic; font: inherit;">820</div>): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement</div>.&#x201d; This ASU eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. The standard is effective for all entities for financial statements issued for fiscal years beginning after <div style="display: inline; font-style: italic; font: inherit;"> December 15, 2019, </div>and interim periods within those fiscal years. The Company adopted the standard on <div style="display: inline; font-style: italic; font: inherit;"> April 1, 2020. </div>The adoption of this guidance did <div style="display: inline; font-style: italic; font: inherit;">not</div> have a material impact on the Company's financial statements.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">All other newly issued accounting pronouncements but <div style="display: inline; font-style: italic; font: inherit;">not</div> yet effective have been deemed either immaterial or <div style="display: inline; font-style: italic; font: inherit;">not</div> applicable.</div></div></div> -1092554 -1092554 -437815 -62594 -500409 -1092554 -437815 5224423 5224423 6327113 5534728 151923 151923 151923 5224423 5224423 4000000 -745306 -745306 -1779242 -201840 -1981082 -745306 -1779242 3243 190173 28078 7579 7265 20499 22515 182624 24684 26685 2001 -11182 -11182 -11182 175000 15000 175000 15121 91104 39027 170647 57057 60885 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Reclassifications</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Certain reclassifications have been made to the comparative period amounts to conform to the current period presentation. Certain items on the unaudited statements of operations and cash flows have been reclassified to conform with current period presentation. The assets, liabilities, income, and cash flows of GB Sciences Louisiana, LLC have been separated from the comparative period amounts to confirm to the current period presentation as discontinued operations as the result of the sale of the Company's interest in GB Sciences Louisiana, LLC (Note <div style="display: inline; font-style: italic; font: inherit;">10</div>). The reclassifications had <div style="display: inline; font-style: italic; font: inherit;">no</div> effect on the reported financial position, results of operations or cash flows of the Company.</div></div></div> 4900000 150000 2500000 8000000 4000000 745975 485000 5000 100000 136081 151202 -1846700 -2538883 -1846700 -1846700 -2274449 -264434 -2538883 5360299 5533833 -3728 51344 0.203 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">9</div> &#x2013; Related Party Transactions</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">As of <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020 </div>the Company is indebted to its officers and directors for a total of $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">712,176</div></div>, consisting of <div style="display: inline; font-style: italic; font: inherit;">$447,633</div> in unpaid wages, <div style="display: inline; font-style: italic; font: inherit;">$109,087</div> in directors' compensation, <div style="display: inline; font-style: italic; font: inherit;">$84,497</div> in unpaid bonuses, and <div style="display: inline; font-style: italic; font: inherit;">$70,959</div> in reimbursements for business expenses.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">In connection with the sale of membership interest in GB Sciences Louisiana, LLC, the Company issued a note payable in the amount of $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">151,923</div></div> to John Davis, the Company's former General Counsel and President of GB Sciences Louisiana, LLC, for unpaid fees and bonuses. The note matures upon receipt of the <div style="display: inline; font-style: italic; font: inherit;">first</div> payment from the Wellcana Note Receivable (Note <div style="display: inline; font-style: italic; font: inherit;">10</div>). The note and interest accrued was repaid on <div style="display: inline; font-style: italic; font: inherit;"> August 4, 2020, </div>when the related funds were withheld from the <div style="display: inline; font-style: italic; font: inherit;">first</div> payment to the Company under the Wellcana Note Receivable (Note <div style="display: inline; font-style: italic; font: inherit;">12</div>).</div></div> 8000000000000 17772 62641 500000 250000 750000 -99251168 -97387205 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Revenue Recognition</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The FASB issued Accounting Standards Codification (&#x201c;ASC&#x201d;) <div style="display: inline; font-style: italic; font: inherit;">606</div> as guidance on the recognition of revenue from contracts with customers. Revenue recognition depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance permits <div style="display: inline; font-style: italic; font: inherit;">two</div> methods of adoption: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). The Company adopted the guidance on <div style="display: inline; font-style: italic; font: inherit;"> April 1, 2018 </div>and applied the cumulative catch-up transition method.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company's only current revenue source is from sales of cannabis, a distinct physical good. Under ASC <div style="display: inline; font-style: italic; font: inherit;">606,</div> the Company is required to separately identify each performance obligation resulting from its contracts from customers, which <div style="display: inline; font-style: italic; font: inherit;"> may </div>be a good or a service. A contract <div style="display: inline; font-style: italic; font: inherit;"> may </div>contain <div style="display: inline; font-style: italic; font: inherit;">one</div> or more performance obligations. All of the Company's contracts with customers, past and present, contain only a single performance obligation, the delivery of distinct physical goods. Because fulfillment of the company's performance obligation to the customer under ASC <div style="display: inline; font-style: italic; font: inherit;">606</div> results in the same timing of revenue recognition as under the previous guidance (i.e. revenue is recognized upon delivery of physical goods), the Company did <div style="display: inline; font-style: italic; font: inherit;">not</div> record any material adjustment to report the cumulative effect of initial application of the guidance.</div></div></div> 551197 551197 910676 910676 551197 910676 3000000 7000000 3000000 300000 1000000 <div style="display: inline; font-family: times new roman; font-size: 10pt"><table style="; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px; min-; min-width: 700px;" cellspacing="0" cellpadding="0" border="0"> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="10" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">As of June 30, 2020</div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 55%;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Short-Term Notes Payable</div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Face Value</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Discount</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">Carrying Value</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">6% Convertible promissory notes payable (Note 6)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,257,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(58,812</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,198,188</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">8% Convertible Secured Promissory Note dated February 28, 2019, as amended (Note 6)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,271,863</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(182,276</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,089,587</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">8% Convertible Promissory Note dated April 23, 2019 (Note 6)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">3,041,500</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">3,041,500</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">0% Note Payable dated October 23, 2017 (Note 5)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">369,445</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(6,607</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">362,838</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">8% Line of Credit dated November 27, 2019 (Note 5)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">485,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">485,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">8% Note Payable dated May 7, 2020 (Note 5)</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">150,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">150,000</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total Short-Term Notes Payable</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">6,574,808</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(247,695</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">6,327,113</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> </table></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><table style="; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px; min-; min-width: 700px;" cellspacing="0" cellpadding="0" border="0"> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="22" rowspan="1" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">For the Three Months Ended June 30,</div></div></div></div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="10" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">2020</div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="10" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">2019</div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Continuing</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Discontinued</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Total</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Continuing</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Discontinued</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Total</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 28%;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Sales revenue</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">551,197</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">551,197</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">910,676</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">910,676</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Cost of goods sold</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(491,795</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(491,795</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(624,369</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(624,369</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Gross profit</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">59,402</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">59,402</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">286,307</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">286,307</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">General and administrative expenses</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">804,708</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">804,708</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">2,065,549</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">201,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">2,267,389</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">LOSS FROM OPERATIONS</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(745,306</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(745,306</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,779,242</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(201,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,981,082</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">OTHER EXPENSE</div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Interest expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(795,313</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(795,313</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(437,815</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(62,594</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(500,409</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">Debt default penalty</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">(286,059</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">(286,059</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Other expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(11,182</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(11,182</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 18pt;">Total other expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,092,554</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,092,554</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(437,815</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(62,594</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(500,409</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">LOSS BEFORE INCOME TAXES</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(1,837,860</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(1,837,860</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(2,217,057</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(264,434</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(2,481,491</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Income tax expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(8,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(8,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(57,392</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(57,392</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">NET LOSS</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(1,846,700</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">-</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(1,846,700</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(2,274,449</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(264,434</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(2,538,883</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> </tr> </table></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><table border="0" cellpadding="0" cellspacing="0" style="; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px; min-; min-width: 700px;"> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">June 30, 2020</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">March 31, 2020</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 70%;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Raw materials</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">129,133</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">91,465</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Work in progress</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">923,737</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,166,511</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Finished goods</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">619,491</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">466,319</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Subtotal</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,672,361</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">1,724,295</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Allowance to reduce inventory to net realizable value</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(126,470</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(278,456</div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-weight: bold;">Total inventory, net</div></div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">1,545,891</div></div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">1,445,839</div></div></td> <td nowrap="nowrap" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td> </tr> </table></div> 176402 13366334 0.28 240627102 246852769 275541602 280532686 1330000 1338057 1361863 1269067 1361863 1271863 1198188 1089587 3041500 362838 485000 150000 6327113 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">1</div> &#x2013;&nbsp;Background and Significant Accounting Policies</div>&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">GB Sciences, Inc. (&#x201c;the Company&#x201d;, &#x201c;GB Sciences&#x201d;, &#x201c;we&#x201d;, &#x201c;us&#x201d;, or &#x201c;our&#x201d;) seeks to be a biopharmaceutical research and cannabinoid-based drug development company whose goal is to create patented formulations for safe, standardized, cannabinoid therapies that target a variety of medical conditions in both the pharmaceutical and wellness markets. The Company is engaged in the research and development of cannabinoid medicines and plans to produce cannabinoid therapies for the wellness markets based on its portfolio of intellectual property.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Through its wholly owned Canadian subsidiary, GBS Global Biopharma, Inc. (&#x201c;GBSGB&#x201d;), the Company is engaged in the research and development of cannabinoid medicines with virtual operations in North America and Europe. GBSGB assets include cannabinoid medicine intellectual property, research contracts and key supplier arrangements. GBSGB's intellectual property covers a range of conditions and several programs are in pre-clinical animal stage of development; including Parkinson's disease, neuropathic pain, and cardiovascular therapeutic programs. GBSGB runs a lean drug development program and takes effort to minimize expenses, including personnel, overhead, and fixed capital expenses &nbsp;through strategic partnerships with Universities and Contract Research Organizations (&#x201c;CROs&#x201d;). GBSGB's intellectual property portfolio includes <div style="display: inline; font-style: italic; font: inherit;">two</div> issued USPTO Patents, <div style="display: inline; font-style: italic; font: inherit;">five</div> USPTO patent applications, <div style="display: inline; font-style: italic; font: inherit;">four</div> provisional USPTO patent applications, and <div style="display: inline; font-style: italic; font: inherit;">one</div> USPTO application that we anticipate filing by the end of calendar year <div style="display: inline; font-style: italic; font: inherit;">2020,</div> as well as licenses for <div style="display: inline; font-style: italic; font: inherit;">three</div> additional patents covering novel cannabinoid delivery systems. In addition to the USPTO patents and patent applications, the company has filed <div style="display: inline; font-style: italic; font: inherit;">28</div> patent applications internationally.</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">We were incorporated in the State of Delaware on <div style="display: inline; font-style: italic; font: inherit;"> April 4, 2001, </div>under the name &#x201c;Flagstick Venture, Inc.&#x201d; On <div style="display: inline; font-style: italic; font: inherit;"> March 28, 2008, </div>stockholders owning a majority of our outstanding common stock approved changing our then name &#x201c;Signature Exploration and Production Corp.&#x201d; as our business model had changed.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> March 13, 2014, </div>we entered into a definitive assets purchase agreement for the acquisition of assets, including the Growblox&#x2122; cultivation technology which resulted in a change in our corporate name on <div style="display: inline; font-style: italic; font: inherit;"> April 4, 2014, </div>from Signature Exploration and Production Corporation to Growblox Sciences, Inc.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Effective <div style="display: inline; font-style: italic; font: inherit;"> December 12, 2016, </div>the Company amended its Certificate of Corporation pursuant to shareholder approval as reported in the Form <div style="display: inline; font-style: italic; font: inherit;">8</div>-K filed on <div style="display: inline; font-style: italic; font: inherit;"> October 14, 2016. &nbsp;</div>Pursuant to the amendment the Company's name was changed from Growblox Sciences, Inc. to GB Sciences, Inc. &nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Effective <div style="display: inline; font-style: italic; font: inherit;"> April 8, 2018, </div>Shareholders of the Company approved the change in corporate domicile from the State of Delaware to the State of Nevada and increase in the number of authorized capital shares from <div style="display: inline; font-style: italic; font: inherit;">250,000,000</div> to <div style="display: inline; font-style: italic; font: inherit;">400,000,000.</div> Effective <div style="display: inline; font-style: italic; font: inherit;"> August 15, 2019, </div>Shareholders of the Company approved an increase in authorized capital shares from <div style="display: inline; font-style: italic; font: inherit;">400,000,000</div> to <div style="display: inline; font-style: italic; font: inherit;">600,000,000.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Basis of Presentation</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The accompanying unaudited interim condensed consolidated financial statements of GB Sciences, Inc. (the &#x201c;Company,&#x201d; &#x201c;We&#x201d; or &#x201c;Us&#x201d;) have been prepared in accordance with U.S. generally accepted accounting principles (&#x201c;U.S. GAAP&#x201d;) for interim financial information and with the instructions to Form <div style="display: inline; font-style: italic; font: inherit;">10</div>-Q and Article <div style="display: inline; font-style: italic; font: inherit;">8</div> of Regulations S-<div style="display: inline; font-style: italic; font: inherit;">X.</div> Accordingly, they do <div style="display: inline; font-style: italic; font: inherit;">not</div> include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the periods presented are <div style="display: inline; font-style: italic; font: inherit;">not</div> necessarily indicative of the results that <div style="display: inline; font-style: italic; font: inherit;"> may </div>be expected for the year ending <div style="display: inline; font-style: italic; font: inherit;"> March 31, 2021. </div>The balance sheet at&nbsp;<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div> has been derived from the audited financial statements at that date but does <div style="display: inline; font-style: italic; font: inherit;">not</div> include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company's annual report on Form <div style="display: inline; font-style: italic; font: inherit;">10</div>-K for the year ended <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div>.</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</div></div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"></div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Principles of Consolidation</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">We prepare our consolidated financial statements in accordance with generally accepted accounting principles (GAAP) for the United States of America. Our consolidated financial statements include all operating divisions and majority-owned subsidiaries, reported as a single operating segment, for which we maintain controlling interests. Intercompany accounts and transactions have been eliminated in consolidation. The ownership interest of non-controlling participants in subsidiaries that are <div style="display: inline; font-style: italic; font: inherit;">not</div> wholly owned is included as a separate component of equity. The non-controlling participants' share of the net loss is included as &#x201c;Net loss attributable to non-controlling interest&#x201d; on the unaudited consolidated statements of operations.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Use of Estimates</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. &nbsp;The Company regularly evaluates estimates and assumptions related to allowances for doubtful accounts, inventory valuation and standard cost allocations, valuation of initial right-of-use assets and corresponding lease liabilities, valuation of beneficial conversion features in convertible debt, valuation of the assets and liabilities of discontinued operations, stock-based compensation expense, purchased intangible asset valuations, deferred income tax asset valuation allowances, uncertain tax positions, litigation and other loss contingencies.&nbsp;&nbsp;These estimates and assumptions are based on current facts, historical experience and various other factors that the Company believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of costs and expenses that are <div style="display: inline; font-style: italic; font: inherit;">not</div> readily apparent from other sources. The actual results the Company experiences <div style="display: inline; font-style: italic; font: inherit;"> may </div>differ materially and adversely from these estimates.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Reclassifications</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Certain reclassifications have been made to the comparative period amounts to conform to the current period presentation. Certain items on the unaudited statements of operations and cash flows have been reclassified to conform with current period presentation. The assets, liabilities, income, and cash flows of GB Sciences Louisiana, LLC have been separated from the comparative period amounts to confirm to the current period presentation as discontinued operations as the result of the sale of the Company's interest in GB Sciences Louisiana, LLC (Note <div style="display: inline; font-style: italic; font: inherit;">10</div>). The reclassifications had <div style="display: inline; font-style: italic; font: inherit;">no</div> effect on the reported financial position, results of operations or cash flows of the Company.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div></div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;"></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Discontinued Operations</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Discontinued operations comprise those activities that were disposed of during the period or which were classified as held for sale at the end of the period and represent a separate major line of business or geographical area that can be clearly distinguished for operational and financial reporting purposes.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">There were <div style="display: inline; font-style: italic; font: inherit;">no</div> assets or liabilities of discontinued operations included in the Company's condensed consolidated balance sheets as of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div> and <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div>.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The revenues and expenses associated with discontinued operations included in our condensed consolidated statements of operations for the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020 </div>and <div style="display: inline; font-style: italic; font: inherit;">2019</div></div> were as follows:</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div> <div> <table style="; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px; min-width: 700px;" cellspacing="0" cellpadding="0" border="0"> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="22" rowspan="1" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">For the Three Months Ended June 30,</div></div></div></div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="10" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">2020</div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="10" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;"><div style="display: inline; font-style: italic; font: inherit;">2019</div></div></div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Continuing</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Discontinued</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Total</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Continuing</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Discontinued</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td colspan="2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt;text-align:center;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-style: italic; font: inherit;">Total</div></div></div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 28%;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Sales revenue</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">551,197</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">551,197</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">910,676</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">910,676</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Cost of goods sold</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(491,795</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(491,795</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(624,369</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(624,369</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Gross profit</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">59,402</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">59,402</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">286,307</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">286,307</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">General and administrative expenses</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">804,708</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">804,708</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">2,065,549</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">201,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">2,267,389</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">LOSS FROM OPERATIONS</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(745,306</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(745,306</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,779,242</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(201,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,981,082</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">OTHER EXPENSE</div> </td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Interest expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(795,313</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(795,313</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(437,815</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(62,594</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(500,409</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">Debt default penalty</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">(286,059</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">(286,059</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding: 0; margin: 0" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Other expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(11,182</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(11,182</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 18pt;">Total other expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,092,554</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(1,092,554</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(437,815</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(62,594</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(500,409</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">LOSS BEFORE INCOME TAXES</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(1,837,860</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(1,837,860</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(2,217,057</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(264,434</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;"><div style="display: inline; font-style: italic; font: inherit;">(2,481,491</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(255, 255, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Income tax expense</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(8,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(8,840</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(57,392</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">-</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);"><div style="display: inline; font-style: italic; font: inherit;">(57,392</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;" nowrap="nowrap">)</td> </tr> <tr style="background-color: rgb(204, 238, 255); vertical-align: bottom"> <td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">NET LOSS</div> </td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(1,846,700</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">-</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;" nowrap="nowrap">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(1,846,700</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(2,274,449</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(264,434</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td> <td style="width: 9%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);"><div style="display: inline; font-weight: bold;"><div style="display: inline; font-style: italic; font: inherit;">(2,538,883</div></div></td> <td style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;" nowrap="nowrap"><div style="display: inline; font-weight: bold;">)</div></td> </tr> </table> </div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:center;">&nbsp;</div> </div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Long-Lived Assets</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Property and equipment comprise a significant portion of our total assets. We evaluate the carrying value of property and equipment if impairment indicators are present or if other circumstances indicate that impairment <div style="display: inline; font-style: italic; font: inherit;"> may </div>exist under authoritative guidance. The annual testing date is <div style="display: inline; font-style: italic; font: inherit;"> March 31. </div>When management believes impairment indicators <div style="display: inline; font-style: italic; font: inherit;"> may </div>exist, projections of the undiscounted future cash flows associated with the use of and eventual disposition of property and equipment are prepared. If the projections indicate that the carrying value of the property and equipment are <div style="display: inline; font-style: italic; font: inherit;">not</div> recoverable, we reduce the carrying values to fair value. These impairment tests are heavily influenced by assumptions and estimates that are subject to change as additional information becomes available.&nbsp;<div style="display: inline; font-style: italic; font: inherit;">No</div> indicators of impairment were identified by the Company as of <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Inventory</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">We value our inventory at the lower of the actual cost of our inventory, as determined using the <div style="display: inline; font-style: italic; font: inherit;">first</div>-in, <div style="display: inline; font-style: italic; font: inherit;">first</div>-out method, or its current estimated net realizable value. We periodically review our physical inventory for excess, obsolete, and potentially impaired items and reserve accordingly. Our reserve estimate for excess and obsolete inventory is based on expected future use.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Beneficial Conversion Feature of Convertible Notes Payable</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company accounts for convertible notes payable in accordance with the guidelines established by the Financial Accounting Standards Board's (&#x201c;FASB&#x201d;) Accounting Standards Codification (&#x201c;ASC&#x201d;) Topic <div style="display: inline; font-style: italic; font: inherit;">470</div>-<div style="display: inline; font-style: italic; font: inherit;">20,</div>&nbsp;Debt with Conversion and Other Options and Emerging Issues Task Force (&#x201c;EITF&#x201d;) <div style="display: inline; font-style: italic; font: inherit;">00</div>-<div style="display: inline; font-style: italic; font: inherit;">27,</div>&nbsp;&#x201c;Application of Issue <div style="display: inline; font-style: italic; font: inherit;">No.</div> <div style="display: inline; font-style: italic; font: inherit;">98</div>-<div style="display: inline; font-style: italic; font: inherit;">5</div> to Certain Convertible Instruments&#x201d;. &nbsp;A beneficial conversion feature (&#x201c;BCF&#x201d;) exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after <div style="display: inline; font-style: italic; font: inherit;">first</div> considering the allocation of a portion of the note proceeds to the fair value of any attached equity instruments, if any related equity instruments were granted with the debt. In accordance with this guidance, the BCF of a convertible note is measured by allocating a portion of the note's proceeds to the warrants, if applicable, and as a reduction of the carrying amount of the convertible note equal to the intrinsic value of the conversion feature, both of which are credited to additional paid-in-capital. The Company calculates the fair value of warrants issued with the convertible notes using the Black-Scholes valuation model and uses the same assumptions for valuing any employee options in accordance with ASC Topic <div style="display: inline; font-style: italic; font: inherit;">718</div> Compensation &#x2013;&nbsp;Stock Compensation. The only difference is that the contractual life of the warrants is used.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The value of the proceeds received from a convertible note is then allocated between the conversion features and warrants on a relative fair value basis. The allocated fair value is recorded in the financial statements as a debt discount (premium) from the face amount of the note and such discount is amortized over the expected term of the convertible note (or to the conversion date of the note, if sooner) and is charged to interest expense.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Revenue Recognition</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The FASB issued Accounting Standards Codification (&#x201c;ASC&#x201d;) <div style="display: inline; font-style: italic; font: inherit;">606</div> as guidance on the recognition of revenue from contracts with customers. Revenue recognition depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance permits <div style="display: inline; font-style: italic; font: inherit;">two</div> methods of adoption: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). The Company adopted the guidance on <div style="display: inline; font-style: italic; font: inherit;"> April 1, 2018 </div>and applied the cumulative catch-up transition method.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company's only current revenue source is from sales of cannabis, a distinct physical good. Under ASC <div style="display: inline; font-style: italic; font: inherit;">606,</div> the Company is required to separately identify each performance obligation resulting from its contracts from customers, which <div style="display: inline; font-style: italic; font: inherit;"> may </div>be a good or a service. A contract <div style="display: inline; font-style: italic; font: inherit;"> may </div>contain <div style="display: inline; font-style: italic; font: inherit;">one</div> or more performance obligations. All of the Company's contracts with customers, past and present, contain only a single performance obligation, the delivery of distinct physical goods. Because fulfillment of the company's performance obligation to the customer under ASC <div style="display: inline; font-style: italic; font: inherit;">606</div> results in the same timing of revenue recognition as under the previous guidance (i.e. revenue is recognized upon delivery of physical goods), the Company did <div style="display: inline; font-style: italic; font: inherit;">not</div> record any material adjustment to report the cumulative effect of initial application of the guidance.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div></div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;"></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Earnings/(loss) per Share</div></div>&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company's basic loss per share has been calculated using the weighted average number of common shares outstanding during the period. The Company had <div style="display: inline; font-style: italic; font: inherit;">153,412,936</div> and <div style="display: inline; font-style: italic; font: inherit;">158,404,020</div> potentially dilutive common shares at&nbsp;<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div> and <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div>, respectively. However, such common stock equivalents were <div style="display: inline; font-style: italic; font: inherit;">not</div> included in the computation of diluted net loss per share as their inclusion would have been anti-dilutive.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;"></div></div></div> <div style="display: inline; font-style: italic; font: inherit;"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Recent Accounting Pronouncements</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;">Recently Adopted Standards</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">In <div style="display: inline; font-style: italic; font: inherit;"> June 2016, </div>the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") <div style="display: inline; font-style: italic; font: inherit;">No.</div> <div style="display: inline; font-style: italic; font: inherit;">2016</div>-<div style="display: inline; font-style: italic; font: inherit;">13,</div> "Financial Instruments&#x2014;Credit Losses (Topic <div style="display: inline; font-style: italic; font: inherit;">326</div>): Measurement of Credit Losses on Financial Instruments" ("ASU <div style="display: inline; font-style: italic; font: inherit;">2016</div>-<div style="display: inline; font-style: italic; font: inherit;">13"</div>).&nbsp; Financial Instruments&#x2014;Credit Losses (Topic <div style="display: inline; font-style: italic; font: inherit;">326</div>) amends guideline on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities.&nbsp; For assets held at amortized cost basis, Topic <div style="display: inline; font-style: italic; font: inherit;">326</div> eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses.&nbsp; The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected.&nbsp; For available-for-sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic <div style="display: inline; font-style: italic; font: inherit;">326</div> will require that credit losses be presented as an allowance rather than as a write-down.&nbsp; ASU <div style="display: inline; font-style: italic; font: inherit;">2016</div>-<div style="display: inline; font-style: italic; font: inherit;">13</div> affects entities holding financial assets and net investment in leases that are <div style="display: inline; font-style: italic; font: inherit;">not</div> accounted for at fair value through net income.&nbsp; The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets <div style="display: inline; font-style: italic; font: inherit;">not</div> excluded from the scope that have the contractual right to receive cash.&nbsp; The amendments in this ASU are effective for smaller reporting companies for fiscal years beginning after <div style="display: inline; font-style: italic; font: inherit;"> December 15, 2022, </div>including interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on its financial statements.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">In <div style="display: inline; font-style: italic; font: inherit;"> August 2018, </div>the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) <div style="display: inline; font-style: italic; font: inherit;">2018</div>-<div style="display: inline; font-style: italic; font: inherit;">13,</div> &#x201c;<div style="display: inline; font-style: italic;">Fair Value Measurement (Topic <div style="display: inline; font-style: italic; font: inherit;">820</div>): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement</div>.&#x201d; This ASU eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. The standard is effective for all entities for financial statements issued for fiscal years beginning after <div style="display: inline; font-style: italic; font: inherit;"> December 15, 2019, </div>and interim periods within those fiscal years. The Company adopted the standard on <div style="display: inline; font-style: italic; font: inherit;"> April 1, 2020. </div>The adoption of this guidance did <div style="display: inline; font-style: italic; font: inherit;">not</div> have a material impact on the Company's financial statements.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">All other newly issued accounting pronouncements but <div style="display: inline; font-style: italic; font: inherit;">not</div> yet effective have been deemed either immaterial or <div style="display: inline; font-style: italic; font: inherit;">not</div> applicable.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div></div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;"></div></div> 1000000 3668167 100 169900 170000 367 478329 478696 -1649113 -88494 24063 93020015 -84743836 8855757 17155999 -7551 -7551 24686 94095065 -87232454 8723541 15610838 27554 97271157 -97387205 28054 97574001 -99251168 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">7</div> &#x2013; Capital Transactions</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Sale of Common Stock and Exercise of Warrants</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> April 1, 2020, </div>the Company entered into the Advisory Agreement with its brokers and effected a temporary decrease in the exercise price of the Company's outstanding warrants to <div style="display: inline; font-style: italic; font: inherit;">$0.03</div>-<div style="display: inline; font-style: italic; font: inherit;">$.05</div> per share. As a result of the price reduction, the Company received notice of the exercise of <div style="display: inline; font-style: italic; font: inherit;">4,991,084</div> warrants during the&nbsp;<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div> and received proceeds of $<div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">136,081</div></div>, net of brokerage fees of $<div style="display: inline;">(<div style="display: inline; font-style: italic; font: inherit;">15,121</div>)</div>.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">At <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, <div style="display: inline; font-style: italic; font: inherit;">79,547,077</div> warrants at exercise prices ranging from <div style="display: inline; font-style: italic; font: inherit;">$0.25</div> to <div style="display: inline; font-style: italic; font: inherit;">$1.00</div> per share and <div style="display: inline; font-style: italic; font: inherit;">13,366,334</div> options with a weighted average exercise price of <div style="display: inline; font-style: italic; font: inherit;">$0.28</div> were outstanding.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:center;">&nbsp;</div></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">12</div> &#x2013; Subsequent Events</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Capital Transactions</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> July 24, 2020, </div>the Company entered into the Loan Agreement, <div style="display: inline; font-style: italic; font: inherit;">8%</div> Secured Promissory Note, and Security Agreement (together, the <div style="display: inline; font-style: italic; font: inherit;"> "July 24 </div>Note") with AJE Management, LLC, which established a revolving loan of up to <div style="display: inline; font-style: italic; font: inherit;">$500,000</div> that the Company <div style="display: inline; font-style: italic; font: inherit;"> may </div>draw on from time to time. The loan is collateralized by the Teco Facility, subject to the pre-existing lien held by CSW Ventures, L.P. in connection with the <div style="display: inline; font-style: italic; font: inherit;">8%</div> Senior Secured Convertible Promissory Note dated <div style="display: inline; font-style: italic; font: inherit;"> February 28, 2019 (</div>Note <div style="display: inline; font-style: italic; font: inherit;">6</div>). Any advances will be made at the sole discretion of the lender following a written request made by the Company. Contemporaneously with the Loan Agreement, the Company and AJE Management entered into the Amendment to the Membership Interest Purchase Agreement with AJE Management. The amendment provides that any balances outstanding under the <div style="display: inline; font-style: italic; font: inherit;"> July 24 </div>Note at the time of the close of the sale of the Teco Facility will be forgiven in exchange for a reduction to the <div style="display: inline; font-style: italic; font: inherit;">$4,000,000</div> note receivable that the Company will receive as consideration for the sale of the Teco Facility (Note <div style="display: inline; font-style: italic; font: inherit;">11</div>). The reduction to the note receivable will be equal to <div style="display: inline; font-style: italic; font: inherit;">3</div> times the balance outstanding under the <div style="display: inline; font-style: italic; font: inherit;"> July 24 </div>Note on the date of the close of the sale of the Teco Facility. As of the date of this report, the Company has <div style="display: inline; font-style: italic; font: inherit;">not</div> received any advances under the <div style="display: inline; font-style: italic; font: inherit;"> July 24 </div>Note.</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;<div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Note Receivable</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company granted forbearance of the <div style="display: inline; font-style: italic; font: inherit;"> June 1, 2020 </div>payment to Wellcana in light of the circumstances created by the COVID-<div style="display: inline; font-style: italic; font: inherit;">19</div> epidemic. The payment was received by the Company on <div style="display: inline; font-style: italic; font: inherit;"> August 4, 2020, </div>net of the Company's annual <div style="display: inline; font-style: italic; font: inherit;">$250,000</div> research contribution commitment to LSU (Note <div style="display: inline; font-style: italic; font: inherit;">10</div>) and the principal and accrued interest payable to John Davis (Note <div style="display: inline; font-style: italic; font: inherit;">5</div>) totaling <div style="display: inline; font-style: italic; font: inherit;">$189,423</div> as of the date of payment.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> August 24, 2020, </div>the Company entered into a letter of intent with Wellcana to discount the note receivable in exchange for accelerated payment. Pursuant to the letter of intent, the Company will receive payments totaling <div style="display: inline; font-style: italic; font: inherit;">$5,224,423,</div> including the forgiveness by Wellcana of <div style="display: inline; font-style: italic; font: inherit;">$324,423</div> in liabilities and the payment of <div style="display: inline; font-style: italic; font: inherit;">$4,900,000</div> in cash, on or before <div style="display: inline; font-style: italic; font: inherit;"> October 15, 2020, </div>less any cash payments made by Wellcana up to the date of the final payment. Upon receipt of the payment, all liabilities owed to the Company by Wellcana, including the <div style="display: inline; font-style: italic; font: inherit;">$8,000,000</div> note receivable and any potential earn-out payments will be considered satisfied in full. Wellcana will assume the annual <div style="display: inline; font-style: italic; font: inherit;">$250,000</div> research contribution commitment to LSU (Note <div style="display: inline; font-style: italic; font: inherit;">10</div>) and the Company will retain <div style="display: inline; font-style: italic; font: inherit;">no</div> rights in the intellectual property developed under the research relationship. In addition, the Company agreed to reduce the <div style="display: inline; font-style: italic; font: inherit;">$750,000</div> note payment due on <div style="display: inline; font-style: italic; font: inherit;"> September 1, 2020 </div>to <div style="display: inline; font-style: italic; font: inherit;">$500,000.</div> Should Wellcana fail to make the <div style="display: inline; font-style: italic; font: inherit;">$4,900,000</div> payment, less any offsets from payments made to date on the note receivable, the term sheet will be void and the original terms of the Membership Interest Purchase Agreement and <div style="display: inline; font-style: italic; font: inherit;">$8,000,000</div> note receivable will prevail.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> August 31, 2020, </div>the Company granted a <div style="display: inline; font-style: italic; font: inherit;">30</div>-day forbearance of the <div style="display: inline; font-style: italic; font: inherit;">$500,000</div> payment due on <div style="display: inline; font-style: italic; font: inherit;"> September 1, 2020. </div>Any payments received prior to <div style="display: inline; font-style: italic; font: inherit;"> October 15, 2020 </div>will be applied to the <div style="display: inline; font-style: italic; font: inherit;">$4,900,000</div> balance due under the <div style="display: inline; font-style: italic; font: inherit;"> August 24, 2020 </div>letter of intent.</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</div> <div style=" font-family: 'Times New Roman', Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Litigation</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> April 22, 2020, </div>the Company failed to repay any of the outstanding balance of the Convertible Promissory Note Payable to Iliad Research and Trading, L.P. (Note <div style="display: inline; font-style: italic; font: inherit;">6</div>), resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by <div style="display: inline; font-style: italic; font: inherit;">10%</div> and the Company recorded expense of <div style="display: inline; font-style: italic; font: inherit;">$286,059</div> related to the default. As of <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020, </div>the total balance due under the note was <div style="display: inline; font-style: italic; font: inherit;">$3,234,149</div> including accrued interest of <div style="display: inline; font-style: italic; font: inherit;">$192,649.</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">On <div style="display: inline; font-style: italic; font: inherit;"> May 20, 2020, </div>Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does <div style="display: inline; font-style: italic; font: inherit;">not</div> intend to defend the lawsuit. On <div style="display: inline; font-style: italic; font: inherit;"> July 14, 2020, </div>the Court entered judgment in favor of Iliad in the amount of <div style="display: inline; font-style: italic; font: inherit;">$3,264,594</div> and the judgment accrues interest at the default rate of <div style="display: inline; font-style: italic; font: inherit;">15%</div> per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has <div style="display: inline; font-style: italic; font: inherit;">not</div> been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC.&nbsp;</div> <div style=" font-family:'Times New Roman', Times, serif;font-size:10pt;margin:0pt 7.2pt;text-align:left;">&nbsp;</div></div> <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-weight: bold;">Note <div style="display: inline; font-style: italic; font: inherit;">2</div> &#x2013;&nbsp;Going Concern</div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The Company's financial statements have been prepared assuming the Company will continue as a going concern. The Company has sustained net losses since inception, which have caused an accumulated deficit of $<div style="display: inline;">(<div style="display: inline; font-style: italic; font: inherit;">99,251,168</div>)</div> at <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>. The Company had a working capital deficit of $<div style="display: inline;">(<div style="display: inline; font-style: italic; font: inherit;">5,381,534</div>)</div> at <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, compared to $<div style="display: inline;">(<div style="display: inline; font-style: italic; font: inherit;">3,884,877</div>)</div> at <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;"> March 31, 2020</div></div>. In addition, the Company has consumed cash in its operating activities of $<div style="display: inline;">(<div style="display: inline; font-style: italic; font: inherit;">323,845</div>)</div> for the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2020</div></div>, compared to $<div style="display: inline;">(<div style="display: inline; font-style: italic; font: inherit;">2,631,121</div>)</div> including $<div style="display: inline;">(<div style="display: inline; font-style: italic; font: inherit;">883,295</div>)</div> from discontinued operations for the <div style="display: inline;"><div style="display: inline; font-style: italic; font: inherit;">three</div> months ended <div style="display: inline; font-style: italic; font: inherit;"> June 30, 2019</div></div>. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">Management has been able, thus far, to finance the losses through a public offering, private placements and obtaining operating funds from stockholders. The Company is continuing to seek sources of financing. &nbsp;There are <div style="display: inline; font-style: italic; font: inherit;">no</div> assurances that the Company will be successful in achieving its goals.</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">In view of these conditions, the Company's ability to continue as a going concern is dependent upon its ability to obtain additional financing or capital sources, to meet its financing requirements, and ultimately to achieve profitable operations. Management believes that its current and future plans provide an opportunity to continue as a&nbsp;going concern. The accompanying financial statements do <div style="display: inline; font-style: italic; font: inherit;">not</div> include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that <div style="display: inline; font-style: italic; font: inherit;"> may </div>be necessary in the event the Company is unable to continue as a going concern.</div></div> 601822 592982 <div style="display: inline; font-family: times new roman; font-size: 10pt"><div style="display: inline; font-family: times new roman; font-size: 10pt"><div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;"><div style="display: inline; font-style: italic;"><div style="display: inline; font-weight: bold;">Use of Estimates</div></div></div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">&nbsp;</div> <div style=" font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin: 0pt; text-align: left;">The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. &nbsp;The Company regularly evaluates estimates and assumptions related to allowances for doubtful accounts, inventory valuation and standard cost allocations, valuation of initial right-of-use assets and corresponding lease liabilities, valuation of beneficial conversion features in convertible debt, valuation of the assets and liabilities of discontinued operations, stock-based compensation expense, purchased intangible asset valuations, deferred income tax asset valuation allowances, uncertain tax positions, litigation and other loss contingencies.&nbsp;&nbsp;These estimates and assumptions are based on current facts, historical experience and various other factors that the Company believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of costs and expenses that are <div style="display: inline; font-style: italic; font: inherit;">not</div> readily apparent from other sources. 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Inventory, net Total inventory, net Exercise of warrants for stock Represents the monetary amount of Exercise of warrants for stock, value, during the indicated time period. Cumulative effect of the new lease standard The amount after tax of increase (decrease) to equity resulting from the cumulative effect of adopting a new lease standard in the period. Teco [Member] Information pertaining to Teco. Exercise of warrants for stock (in shares) The number of shares issued in exchange for the exercise of warrants. Work in progress us-gaap_InventoryValuationReserves Allowance to reduce inventory to net realizable value GB Sciences Nopah, LLC [Member] Information pertaining to GB Sciences Nopah, LLC. Operating and Finance Lease Liabilities, Maturity [Table Text Block] The tabular disclosure of undiscounted cash flows of operating and finance lease liabilities. 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Raw materials Cumulative Effect, Period of Adoption [Domain] Cumulative Effect, Period of Adoption [Axis] Cumulative Effect, Period of Adoption, Adjustment [Member] OPERATING ACTIVITIES: Note receivable us-gaap_WarrantsAndRightsOutstanding Warrants and Rights Outstanding Statement [Line Items] Accounts receivable, net of allowance for doubtful accounts of $126,650 and $130,378 at June 30, 2020 and March 31, 2020, respectively Additional paid-in capital STOCKHOLDERS' EQUITY: us-gaap_InterestAndDebtExpense Interest and Debt Expense, Total Other expense Total other expense Total other expense us-gaap_SaleOfStockConsiderationReceivedOnTransaction Sale of Stock, Consideration Received on Transaction CURRENT ASSETS: us-gaap_SaleOfStockConsiderationReceivedPerTransaction Sale of Stock, Consideration Received Per Transaction CASH AND CASH EQUIVALENTS AT END OF PERIOD FROM CONTINUING OPERATIONS us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsIncludingDisposalGroupAndDiscontinuedOperations CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD CASH AND CASH EQUIVALENTS AT END OF PERIOD Inventory, Policy [Policy Text Block] us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsPeriodIncreaseDecreaseIncludingExchangeRateEffect Net change in cash and cash equivalents us-gaap_Liabilities TOTAL LIABILITIES us-gaap_NetCashProvidedByUsedInFinancingActivities Net cash provided by financing activities The 8% Note Payable dated May 7, 2020 [Member] Represents the 8% Note Payable dated May 7, 2020. 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Noncontrolling Interest Disclosure [Text Block] Statement of Cash Flows [Abstract] Statement of Stockholders' Equity [Abstract] Income Statement [Abstract] Disposal Groups, Including Discontinued Operations [Table Text Block] Disposal Group Name [Axis] Disposal Group Name [Domain] us-gaap_FinanceLeaseInterestExpense Finance Lease, Interest Expense us-gaap_FinanceLeaseLiabilityPaymentsDue Total minimum lease payments, finance leases us-gaap_FinanceLeaseRightOfUseAssetAmortization Finance Lease, Right-of-Use Asset, Amortization gblx_TermOfAgreementRenewal Term of Agreement, Renewal (Year) The length of time of a renewed agreement with another party. gblx_OptionToRenewAgreementAmount Option to Renew Agreement, Amount The amount of options available in which to renew an agreement. gblx_TermOfAgreement Term of Agreement (Year) The length of time of an agreement with another party. us-gaap_FinanceLeaseLiabilityUndiscountedExcessAmount Less: Amount representing interest, finance leases 2022, finance leases 2023, finance leases 2024, finance leases us-gaap_ReceivableWithImputedInterestEffectiveYieldInterestRate Receivable with Imputed Interest, Effective Yield (Interest Rate) Agreement With Louisiana State University AgCenter [Member] Information pertaining to the agreement with Louisiana State University ("LSU") AgCenter to be the sole operator of LSU's medical marijuana program. 2025, finance leases 2021 (9 months), finance leases Wellcana Group, LLC [Member] Related to Wellcana Group, LLC ("Wellcana"). FINANCING ACTIVITIES: gblx_SaleOfStockPercentageOfOwnership Sale of Stock, Percentage of Ownership Percentage of subsidiary's or equity investee's stock sold in the stock transaction. Research and Development Arrangement, Contract to Perform for Others, Type [Axis] Research and Development Arrangement, Contract to Perform for Others, Type [Domain] GB Sciences Louisiana, LLC, Sale of Equity [Member] Information pertaining to the sale of equity for GB Sciences Louisiana, LLC, a wholly-owned subsidiary of the company. gblx_SaleOfStockPercentageOfAvailableStockForSalePercentToBeSoldPerTransaction Sale of Stock, Percentage of Available Stock For Sale, Percent to be Sold Per Transaction For the additional percentage of subsidiary's or equity investee's stock available for sale, the percentage to be sold per transaction. gblx_SaleOfStockPercentageOfOwnershipAvailableForSale Sale of Stock, Percentage of Ownership Available For Sale The percentage of subsidiary's or equity investee's stock still available for sale. us-gaap_ProceedsFromDivestitureOfBusinesses Proceeds from Divestiture of Businesses us-gaap_OperatingLeaseRightOfUseAssetAmortizationExpense Operating Lease, Right-of-Use Asset, Amortization Expense us-gaap_StockholdersEquity TOTAL EQUITY/(DEFICIT) Balance Balance Class of Stock [Axis] gblx_BrokerageFeesForIssuanceOfCommonStockAndWarrants Brokerage Fees for Issuance of Common Stock and Warrants The amount of cash paid for brokerage fees for issuance of common stock and warrants during the current period. Segment, Continuing and Discontinued Operations [Member] Represents both the component of an entity expected to operate in the foreseeable future, and the component or group of components disposed of or classified as held-for-sale and representing a strategic shift that has or will have a major effect on operations and financial results. Includes a business or nonprofit activity on acquisition classified as held-for-sale. gblx_DebtInstrumentPresentValue Debt Instrument, Present Value The value of a debt instrument after future cash amounts attributable to the debt instrument have been discounted to an earlier time. EX-101.PRE 11 gblx-20200630_pre.xml XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE XML 12 R1.htm IDEA: XBRL DOCUMENT v3.20.2
Document And Entity Information - shares
3 Months Ended
Jun. 30, 2020
Sep. 01, 2020
Document Information [Line Items]    
Entity Registrant Name GB SCIENCES INC  
Entity Central Index Key 0001165320  
Current Fiscal Year End Date --03-31  
Entity Filer Category Non-accelerated Filer  
Entity Current Reporting Status Yes  
Entity Emerging Growth Company false  
Entity Small Business true  
Entity Interactive Data Current Yes  
Entity Common Stock, Shares Outstanding (in shares)   280,532,686
Entity Shell Company false  
Document Type 10-Q  
Document Period End Date Jun. 30, 2020  
Document Fiscal Year Focus 2021  
Document Fiscal Period Focus Q1  
Amendment Flag false  
XML 13 R2.htm IDEA: XBRL DOCUMENT v3.20.2
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($)
Jun. 30, 2020
Mar. 31, 2020
CURRENT ASSETS:    
Cash and cash equivalents $ 101,230 $ 151,766
Accounts receivable, net of allowance for doubtful accounts of $126,650 and $130,378 at June 30, 2020 and March 31, 2020, respectively 192,509 117,967
Inventory, net 1,545,891 1,445,839
Prepaid expenses and other current assets 57,057 60,885
Note receivable 5,224,423 5,224,423
TOTAL CURRENT ASSETS 7,121,110 7,000,880
Property and equipment, net 5,360,299 5,533,833
Intangible assets, net of accumulated amortization of $15,344 and $12,287 at June 30, 2020 and March 31, 2020, respectively 1,776,045 1,699,966
Deposits and other noncurrent assets 91,504 91,504
Operating lease right-of-use assets, net 24,684 26,685
TOTAL ASSETS 14,373,642 14,352,868
CURRENT LIABILITIES:    
Accounts payable 2,712,122 2,559,914
Accrued interest 654,760 397,652
Accrued liabilities 1,188,938 888,012
Notes and convertible notes payable and line of credit, net of unamortized discount of $247,695 and $608,580 at June 30, 2020 and March 31, 2020, respectively 6,327,113 5,534,728
Indebtedness to related parties 712,176 586,512
Note payable to related party 151,923 151,923
Income tax payable 601,822 592,982
Finance lease obligations, current 146,211 166,769
Operating lease obligations, current 7,579 7,265
TOTAL CURRENT LIABILITIES 12,502,644 10,885,757
Operating lease obligations, long term 20,499 22,515
Finance lease obligations, long term 3,499,612 3,533,090
TOTAL LIABILITIES 16,022,755 14,441,362
Commitments and contingencies (Note 8)
STOCKHOLDERS' EQUITY:    
Common Stock, $0.0001 par value, 600,000,000 shares authorized, 280,532,686 and 275,541,602 outstanding at June 30, 2020 and March 31, 2020, respectively 28,054 27,554
Additional paid-in capital 97,574,001 97,271,157
Accumulated deficit (99,251,168) (97,387,205)
TOTAL EQUITY/(DEFICIT) (1,649,113) (88,494)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT) $ 14,373,642 $ 14,352,868
XML 14 R3.htm IDEA: XBRL DOCUMENT v3.20.2
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($)
Jun. 30, 2020
Mar. 31, 2020
Accounts receivable, allowance for doubtful accounts $ 126,650 $ 130,378
Intangible assets, accumulated amortization $ 15,344 12,287
Notes and convertible notes payable, unamortized discount, current  
Common stock, par value (in dollars per share) $ 0.0001 $ 0.0001
Common stock, shares authorized (in shares) 600,000,000 600,000,000
Common stock, shares issued (in shares) 280,532,686 275,541,602
Common stock, shares outstanding (in shares) 280,532,686 275,541,602
XML 15 R4.htm IDEA: XBRL DOCUMENT v3.20.2
Condensed Consolidated Statements of Operations (Unaudited) - USD ($)
3 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Sales revenue $ 551,197 $ 910,676
Cost of goods sold (491,795) (624,369)
Gross profit 59,402 286,307
General and administrative expenses 804,708 2,065,549
LOSS FROM OPERATIONS (745,306) (1,779,242)
OTHER EXPENSE    
Interest expense (795,313) (437,815)
Debt default penalty (286,059)
Other expense (11,182)
Total other expense (1,092,554) (437,815)
LOSS BEFORE INCOME TAXES (1,837,860) (2,217,057)
Income tax expense (8,840) (57,392)
LOSS FROM CONTINUING OPERATIONS (1,846,700) (2,274,449)
Loss from discontinued operations (264,434)
NET LOSS (1,846,700) (2,538,883)
Loss attributable to non-controlling interest (132,216)
NET LOSS ATTRIBUTABLE TO GB SCIENCES, INC. (1,846,700) (2,406,667)
Continuing operations (1,846,700) (2,274,449)
Discontinued operations (132,218)
Net loss $ (1,846,700) $ (2,406,667)
Continuing operations (in dollars per share) $ (0.01) $ (0.01)
Discontinued operations (in dollars per share)
Net loss (in dollars per share) $ (0.01) $ (0.01)
Weighted average common shares outstanding - basic and diluted (in shares) 277,968,516 244,036,524
XML 16 R5.htm IDEA: XBRL DOCUMENT v3.20.2
Condensed Consolidated Statements of Cash Flows (Unaudited)
3 Months Ended
Jun. 30, 2020
USD ($)
Jun. 30, 2019
USD ($)
OPERATING ACTIVITIES:    
Net loss $ (1,846,700) $ (2,538,883)
Loss from discontinued operations (264,434)
Net loss from continuing operations (1,846,700) (2,274,449)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 13,028 99,485
Stock-based compensation 176,402
Bad debt expense/(recovery) (3,728) 51,344
Amortization of debt discount and beneficial conversion feature 510,885 200,382
Interest expense on conversion of notes payable 17,225
Default penalty on convertible note payable 286,059
Changes in operating assets and liabilities:    
Accounts receivable (70,814) 126,579
Prepaid expenses and other current assets 3,828 192,733
Decrease in deposits and other noncurrent assets 8,762
Inventory 64,602 (311,887)
Accounts payable 72,280 (222,008)
Accrued expenses 264,662 100,887
Accrued interest 247,549 86,719
Income tax payable 8,840
Indebtedness to related parties 125,664
Net cash used in operating activities of continuing operations (323,845) (1,747,826)
Net cash used in operating activities of discontinued operations (883,295)
Net cash used in operating activities (323,845) (2,631,121)
INVESTING ACTIVITIES:    
Purchase of property and equipment (170,647)
Acquisition of intangible assets (39,027)
Net cash used in investing activities of continuing operations (209,674)
Net cash used in investing activities of discontinued operations (48,000)
Net cash used in investing activities (257,674)
FINANCING ACTIVITIES:    
Proceeds from issuance of common stock 745,975
Proceeds from warrant exercises 151,202
Proceeds from convertible notes payable 150,000 2,500,000
Proceeds from line of credit 5,000
Fees for issuance of convertible note (175,000)
Brokerage fees for issuance of common stock and warrants (15,121) (91,104)
Principal payments on debt and lease obligations (17,772) (62,641)
Net cash provided by financing activities of continuing operations 273,309 2,917,230
Net cash used in financing activities of discontinued operations (114,881)
Net cash provided by financing activities 273,309 2,802,349
Net change in cash and cash equivalents (50,536) (86,446)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 151,766 227,758
CASH AND CASH EQUIVALENTS AT END OF PERIOD 101,230 141,312
Less: cash and cash equivalents classified as discontinued operations (107,738)
CASH AND CASH EQUIVALENTS AT END OF PERIOD FROM CONTINUING OPERATIONS 101,230 33,574
Cash paid for interest
Cash paid for income tax
Non-cash transactions:    
Depreciation capitalized in inventory 164,654  
Property capitalized under operating leases 213,218
Patent filing and drafting costs capitalized in intangible assets 78,226  
Discount on convertible notes payable attributable to warrant modification 150,000
Stock issued upon conversion of long-term note payable 170,000
Induced dividend from warrant exercises 17,263 74,400
Cumulative effect of the new lease standard $ 7,551
XML 17 R6.htm IDEA: XBRL DOCUMENT v3.20.2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($)
Cumulative Effect, Period of Adoption, Adjustment [Member]
Common Stock [Member]
Cumulative Effect, Period of Adoption, Adjustment [Member]
Additional Paid-in Capital [Member]
Cumulative Effect, Period of Adoption, Adjustment [Member]
Retained Earnings [Member]
Cumulative Effect, Period of Adoption, Adjustment [Member]
Noncontrolling Interest [Member]
Cumulative Effect, Period of Adoption, Adjustment [Member]
Common Stock [Member]
Additional Paid-in Capital [Member]
Retained Earnings [Member]
Noncontrolling Interest [Member]
Total
Balance (in shares) at Mar. 31, 2019           240,627,102        
Balance (Accounting Standards Update 2016-02 [Member]) at Mar. 31, 2019 $ (7,551) $ (7,551)          
Balance at Mar. 31, 2019           $ 24,063 $ 93,020,015 $ (84,743,836) $ 8,855,757 $ 17,155,999
Issuance of stock for debt conversion (in shares)           1,000,000        
Issuance of stock for debt conversion           $ 100 169,900 170,000
Exercise of warrants for stock (in shares)           1,957,500        
Exercise of warrants for stock           $ 196 175,979 176,175
Share based compensation expense           176,402 176,402
Issuance of stock for cash, net of issuance costs (in shares)           3,668,167        
Issuance of stock for cash, net of issuance costs           $ 367 478,329 478,696
Exchanged shares issued to consultant for options (in shares)           (400,000)        
Exchanged shares issued to consultant for options           $ (40) 40
Inducement dividend from warrant exercises           74,400 (74,400)
Net loss           (2,406,667) (2,406,667)
Loss attributable to non-controlling interest           (132,216) (132,216)
Balance (in shares) at Jun. 30, 2019           246,852,769        
Balance at Jun. 30, 2019           $ 24,686 94,095,065 (87,232,454) 8,723,541 15,610,838
Balance (in shares) at Mar. 31, 2020           275,541,602        
Balance at Mar. 31, 2020           $ 27,554 97,271,157 (97,387,205) (88,494)
Exercise of warrants for stock (in shares)           4,991,084        
Exercise of warrants for stock           $ 500 135,581 136,081
Inducement dividend from warrant exercises           17,263 (17,263)
Net loss           (1,846,700) (1,846,700)
Loss attributable to non-controlling interest                  
Discount on convertible notes payable attributable to warrant modification           150,000 150,000
Balance (in shares) at Jun. 30, 2020           280,532,686        
Balance at Jun. 30, 2020           $ 28,054 $ 97,574,001 $ (99,251,168) $ (1,649,113)
XML 18 R7.htm IDEA: XBRL DOCUMENT v3.20.2
Note 1 - Background and Significant Accounting Policies
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Significant Accounting Policies [Text Block]
Note
1
– Background and Significant Accounting Policies
 
 
GB Sciences, Inc. (“the Company”, “GB Sciences”, “we”, “us”, or “our”) seeks to be a biopharmaceutical research and cannabinoid-based drug development company whose goal is to create patented formulations for safe, standardized, cannabinoid therapies that target a variety of medical conditions in both the pharmaceutical and wellness markets. The Company is engaged in the research and development of cannabinoid medicines and plans to produce cannabinoid therapies for the wellness markets based on its portfolio of intellectual property.
 
Through its wholly owned Canadian subsidiary, GBS Global Biopharma, Inc. (“GBSGB”), the Company is engaged in the research and development of cannabinoid medicines with virtual operations in North America and Europe. GBSGB assets include cannabinoid medicine intellectual property, research contracts and key supplier arrangements. GBSGB's intellectual property covers a range of conditions and several programs are in pre-clinical animal stage of development; including Parkinson's disease, neuropathic pain, and cardiovascular therapeutic programs. GBSGB runs a lean drug development program and takes effort to minimize expenses, including personnel, overhead, and fixed capital expenses  through strategic partnerships with Universities and Contract Research Organizations (“CROs”). GBSGB's intellectual property portfolio includes
two
issued USPTO Patents,
five
USPTO patent applications,
four
provisional USPTO patent applications, and
one
USPTO application that we anticipate filing by the end of calendar year
2020,
as well as licenses for
three
additional patents covering novel cannabinoid delivery systems. In addition to the USPTO patents and patent applications, the company has filed
28
patent applications internationally.
 
We were incorporated in the State of Delaware on
April 4, 2001,
under the name “Flagstick Venture, Inc.” On
March 28, 2008,
stockholders owning a majority of our outstanding common stock approved changing our then name “Signature Exploration and Production Corp.” as our business model had changed.
 
On
March 13, 2014,
we entered into a definitive assets purchase agreement for the acquisition of assets, including the Growblox™ cultivation technology which resulted in a change in our corporate name on
April 4, 2014,
from Signature Exploration and Production Corporation to Growblox Sciences, Inc.
 
Effective
December 12, 2016,
the Company amended its Certificate of Corporation pursuant to shareholder approval as reported in the Form
8
-K filed on
October 14, 2016.  
Pursuant to the amendment the Company's name was changed from Growblox Sciences, Inc. to GB Sciences, Inc.  
 
Effective
April 8, 2018,
Shareholders of the Company approved the change in corporate domicile from the State of Delaware to the State of Nevada and increase in the number of authorized capital shares from
250,000,000
to
400,000,000.
Effective
August 15, 2019,
Shareholders of the Company approved an increase in authorized capital shares from
400,000,000
to
600,000,000.
 
Basis of Presentation
 
The accompanying unaudited interim condensed consolidated financial statements of GB Sciences, Inc. (the “Company,” “We” or “Us”) have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form
10
-Q and Article
8
of Regulations S-
X.
Accordingly, they do
not
include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the periods presented are
not
necessarily indicative of the results that
may
be expected for the year ending
March 31, 2021.
The balance sheet at 
March 31, 2020
has been derived from the audited financial statements at that date but does
not
include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company's annual report on Form
10
-K for the year ended
March 31, 2020
.
 
 
Principles of Consolidation
 
We prepare our consolidated financial statements in accordance with generally accepted accounting principles (GAAP) for the United States of America. Our consolidated financial statements include all operating divisions and majority-owned subsidiaries, reported as a single operating segment, for which we maintain controlling interests. Intercompany accounts and transactions have been eliminated in consolidation. The ownership interest of non-controlling participants in subsidiaries that are
not
wholly owned is included as a separate component of equity. The non-controlling participants' share of the net loss is included as “Net loss attributable to non-controlling interest” on the unaudited consolidated statements of operations.
 
Use of Estimates
 
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  The Company regularly evaluates estimates and assumptions related to allowances for doubtful accounts, inventory valuation and standard cost allocations, valuation of initial right-of-use assets and corresponding lease liabilities, valuation of beneficial conversion features in convertible debt, valuation of the assets and liabilities of discontinued operations, stock-based compensation expense, purchased intangible asset valuations, deferred income tax asset valuation allowances, uncertain tax positions, litigation and other loss contingencies.  These estimates and assumptions are based on current facts, historical experience and various other factors that the Company believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of costs and expenses that are
not
readily apparent from other sources. The actual results the Company experiences
may
differ materially and adversely from these estimates.
 
Reclassifications
 
Certain reclassifications have been made to the comparative period amounts to conform to the current period presentation. Certain items on the unaudited statements of operations and cash flows have been reclassified to conform with current period presentation. The assets, liabilities, income, and cash flows of GB Sciences Louisiana, LLC have been separated from the comparative period amounts to confirm to the current period presentation as discontinued operations as the result of the sale of the Company's interest in GB Sciences Louisiana, LLC (Note
10
). The reclassifications had
no
effect on the reported financial position, results of operations or cash flows of the Company.
 
Discontinued Operations
 
Discontinued operations comprise those activities that were disposed of during the period or which were classified as held for sale at the end of the period and represent a separate major line of business or geographical area that can be clearly distinguished for operational and financial reporting purposes.
 
There were
no
assets or liabilities of discontinued operations included in the Company's condensed consolidated balance sheets as of
June 30, 2020
and
March 31, 2020
.
 
The revenues and expenses associated with discontinued operations included in our condensed consolidated statements of operations for the
three
months ended
June 30, 2020
and
2019
were as follows:
 
   
For the Three Months Ended June 30,
 
   
2020
   
2019
 
   
Continuing
   
Discontinued
   
Total
   
Continuing
   
Discontinued
   
Total
 
Sales revenue
  $
551,197
    $
-
    $
551,197
    $
910,676
    $
-
    $
910,676
 
Cost of goods sold
   
(491,795
)    
-
     
(491,795
)    
(624,369
)    
-
     
(624,369
)
Gross profit
   
59,402
     
-
     
59,402
     
286,307
     
-
     
286,307
 
General and administrative expenses
   
804,708
     
-
     
804,708
     
2,065,549
     
201,840
     
2,267,389
 
LOSS FROM OPERATIONS
   
(745,306
)    
-
     
(745,306
)    
(1,779,242
)    
(201,840
)    
(1,981,082
)
OTHER EXPENSE
                                               
Interest expense
   
(795,313
)    
-
     
(795,313
)    
(437,815
)    
(62,594
)    
(500,409
)
Debt default penalty    
(286,059
)    
-
     
(286,059
)    
-
     
-
     
-
 
Other expense
   
(11,182
)    
-
     
(11,182
)    
-
     
-
     
-
 
Total other expense
   
(1,092,554
)    
-
     
(1,092,554
)    
(437,815
)    
(62,594
)    
(500,409
)
LOSS BEFORE INCOME TAXES
   
(1,837,860
)    
-
     
(1,837,860
)    
(2,217,057
)    
(264,434
)    
(2,481,491
)
Income tax expense
   
(8,840
)    
-
     
(8,840
)    
(57,392
)    
-
     
(57,392
)
NET LOSS
  $
(1,846,700
)
  $
-
    $
(1,846,700
)
  $
(2,274,449
)
  $
(264,434
)
  $
(2,538,883
)
 
Long-Lived Assets
 
Property and equipment comprise a significant portion of our total assets. We evaluate the carrying value of property and equipment if impairment indicators are present or if other circumstances indicate that impairment
may
exist under authoritative guidance. The annual testing date is
March 31.
When management believes impairment indicators
may
exist, projections of the undiscounted future cash flows associated with the use of and eventual disposition of property and equipment are prepared. If the projections indicate that the carrying value of the property and equipment are
not
recoverable, we reduce the carrying values to fair value. These impairment tests are heavily influenced by assumptions and estimates that are subject to change as additional information becomes available. 
No
indicators of impairment were identified by the Company as of
June 30, 2020
.
 
Inventory
 
We value our inventory at the lower of the actual cost of our inventory, as determined using the
first
-in,
first
-out method, or its current estimated net realizable value. We periodically review our physical inventory for excess, obsolete, and potentially impaired items and reserve accordingly. Our reserve estimate for excess and obsolete inventory is based on expected future use.
 
Beneficial Conversion Feature of Convertible Notes Payable
 
The Company accounts for convertible notes payable in accordance with the guidelines established by the Financial Accounting Standards Board's (“FASB”) Accounting Standards Codification (“ASC”) Topic
470
-
20,
 Debt with Conversion and Other Options and Emerging Issues Task Force (“EITF”)
00
-
27,
 “Application of Issue
No.
98
-
5
to Certain Convertible Instruments”.  A beneficial conversion feature (“BCF”) exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after
first
considering the allocation of a portion of the note proceeds to the fair value of any attached equity instruments, if any related equity instruments were granted with the debt. In accordance with this guidance, the BCF of a convertible note is measured by allocating a portion of the note's proceeds to the warrants, if applicable, and as a reduction of the carrying amount of the convertible note equal to the intrinsic value of the conversion feature, both of which are credited to additional paid-in-capital. The Company calculates the fair value of warrants issued with the convertible notes using the Black-Scholes valuation model and uses the same assumptions for valuing any employee options in accordance with ASC Topic
718
Compensation – Stock Compensation. The only difference is that the contractual life of the warrants is used.
 
The value of the proceeds received from a convertible note is then allocated between the conversion features and warrants on a relative fair value basis. The allocated fair value is recorded in the financial statements as a debt discount (premium) from the face amount of the note and such discount is amortized over the expected term of the convertible note (or to the conversion date of the note, if sooner) and is charged to interest expense.
 
Revenue Recognition
 
The FASB issued Accounting Standards Codification (“ASC”)
606
as guidance on the recognition of revenue from contracts with customers. Revenue recognition depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance permits
two
methods of adoption: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). The Company adopted the guidance on
April 1, 2018
and applied the cumulative catch-up transition method.
 
The Company's only current revenue source is from sales of cannabis, a distinct physical good. Under ASC
606,
the Company is required to separately identify each performance obligation resulting from its contracts from customers, which
may
be a good or a service. A contract
may
contain
one
or more performance obligations. All of the Company's contracts with customers, past and present, contain only a single performance obligation, the delivery of distinct physical goods. Because fulfillment of the company's performance obligation to the customer under ASC
606
results in the same timing of revenue recognition as under the previous guidance (i.e. revenue is recognized upon delivery of physical goods), the Company did
not
record any material adjustment to report the cumulative effect of initial application of the guidance.
 
Earnings/(loss) per Share
 
 
The Company's basic loss per share has been calculated using the weighted average number of common shares outstanding during the period. The Company had
153,412,936
and
158,404,020
potentially dilutive common shares at 
June 30, 2020
and
March 31, 2020
, respectively. However, such common stock equivalents were
not
included in the computation of diluted net loss per share as their inclusion would have been anti-dilutive.
 
Recent Accounting Pronouncements
 
Recently Adopted Standards
 
In
June 2016,
the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU")
No.
2016
-
13,
"Financial Instruments—Credit Losses (Topic
326
): Measurement of Credit Losses on Financial Instruments" ("ASU
2016
-
13"
).  Financial Instruments—Credit Losses (Topic
326
) amends guideline on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities.  For assets held at amortized cost basis, Topic
326
eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses.  The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected.  For available-for-sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic
326
will require that credit losses be presented as an allowance rather than as a write-down.  ASU
2016
-
13
affects entities holding financial assets and net investment in leases that are
not
accounted for at fair value through net income.  The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets
not
excluded from the scope that have the contractual right to receive cash.  The amendments in this ASU are effective for smaller reporting companies for fiscal years beginning after
December 15, 2022,
including interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on its financial statements.
 
In
August 2018,
the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU)
2018
-
13,
Fair Value Measurement (Topic
820
): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement
.” This ASU eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. The standard is effective for all entities for financial statements issued for fiscal years beginning after
December 15, 2019,
and interim periods within those fiscal years. The Company adopted the standard on
April 1, 2020.
The adoption of this guidance did
not
have a material impact on the Company's financial statements.
 
All other newly issued accounting pronouncements but
not
yet effective have been deemed either immaterial or
not
applicable.
 
XML 19 R8.htm IDEA: XBRL DOCUMENT v3.20.2
Note 2 - Going Concern
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Substantial Doubt about Going Concern [Text Block]
Note
2
– Going Concern
 
The Company's financial statements have been prepared assuming the Company will continue as a going concern. The Company has sustained net losses since inception, which have caused an accumulated deficit of $
(
99,251,168
)
at
June 30, 2020
. The Company had a working capital deficit of $
(
5,381,534
)
at
June 30, 2020
, compared to $
(
3,884,877
)
at
March 31, 2020
. In addition, the Company has consumed cash in its operating activities of $
(
323,845
)
for the
three
months ended
June 30, 2020
, compared to $
(
2,631,121
)
including $
(
883,295
)
from discontinued operations for the
three
months ended
June 30, 2019
. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern.
 
Management has been able, thus far, to finance the losses through a public offering, private placements and obtaining operating funds from stockholders. The Company is continuing to seek sources of financing.  There are
no
assurances that the Company will be successful in achieving its goals.
 
In view of these conditions, the Company's ability to continue as a going concern is dependent upon its ability to obtain additional financing or capital sources, to meet its financing requirements, and ultimately to achieve profitable operations. Management believes that its current and future plans provide an opportunity to continue as a going concern. The accompanying financial statements do
not
include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that
may
be necessary in the event the Company is unable to continue as a going concern.
XML 20 R9.htm IDEA: XBRL DOCUMENT v3.20.2
Note 3 - Inventory
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Inventory Disclosure [Text Block]
Note
3
– Inventory
 
Raw materials consist of supplies, materials, and consumables used in the cultivation and extraction processes. Work-in-progress includes live plants and cannabis in the drying, curing, and trimming processes. Finished goods includes completed cannabis flower, trim, and extracts in bulk and packaged forms.
 
   
June 30, 2020
   
March 31, 2020
 
                 
Raw materials
  $
129,133
    $
91,465
 
Work in progress
   
923,737
    $
1,166,511
 
Finished goods
   
619,491
    $
466,319
 
Subtotal
   
1,672,361
     
1,724,295
 
Allowance to reduce inventory to net realizable value
   
(126,470
)    
(278,456
)
Total inventory, net
  $
1,545,891
    $
1,445,839
 
XML 21 R10.htm IDEA: XBRL DOCUMENT v3.20.2
Note 4 - Leases
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Lessee, Operating and Finance Leases [Text Block]
Note
4
– Leases
 
The Company determines if an arrangement is a lease at inception and has lease agreements for warehouses, office facilities, and equipment. These commitments have remaining non-cancelable lease terms, with lease expirations which range from
2024
to
2025.
 
As a result of the adoption of ASC
842,
certain real estate and equipment operating leases have been recorded on the balance sheet with a lease liability and right-of-use asset ("ROU"). Application of this standard resulted in the recognition of ROU assets of
$182,624,
net of accumulated amortization, and a corresponding lease liability of 
$190,173
at the
April 1, 2019,
the date of adoption. Accounting for finance leases is substantially unchanged.
 
Operating leases are included in other current assets , accrued liabilities, and operating lease obligations, long term on the unaudited condensed consolidated balance sheets. Finance leases are included in property and equipment, finance lease obligations, short term, and finance lease obligations, long term, on the unaudited condensed consolidated balance sheets. ROU assets represent the Company's right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make scheduled lease payments. ROU assets and liabilities are recognized on the lease commencement date based on the present value of lease payments over the lease term. The present value of lease payments is calculated using the incremental borrowing rate at lease commencement, which takes into consideration recent debt issuances as well as other applicable market data available. The rates used to discount finance leases previously recorded as capital leases range from
10.2%
to
11.5%.
Operating leases were discounted at a rate of
17.0%.
 
Lease terms include options to extend when it is reasonably certain that the option will be exercised. Leases with a term of
12
months or less are
not
recorded on the consolidated balance sheet.
 
During the
three
months ended
June 30, 2020
, finance lease costs recorded in the consolidated financial statements were
$143,599,
of which 
$104,924
represents interest expense and 
$38,675
represents amortization of the right-of-use assets. Operating lease costs were
$3,243,
of which 
$1,242
represents interest expense and 
$2,001
represents amortization of the right-of-use assets.
  
Amortization of lease assets is included in general and administrative expenses. The future minimum lease payments of lease liabilities as of
June 30, 2020
, from continuing operations are as follows:
 
Year Ending
   
 
 
 
Operating
 
March 31,
 
Finance Leases
   
Leases
 
                 
2021 (9 months)
  $
422,801
    $
8,836
 
2022
   
544,296
     
11,779
 
2023
   
560,625
     
11,779
 
2024
   
577,444
     
3,926
 
2025
   
594,767
     
-
 
Thereafter
   
3,781,101
     
-
 
Total minimum lease payments
   
6,481,034
     
36,320
 
Less: Amount representing interest
   
(2,835,211
)    
(8,242
)
Present value of minimum lease payments
   
3,645,823
     
28,078
 
Less: Current maturities of capital lease obligations
   
(146,211
)    
(7,579
)
Long-term capital lease obligations
  $
3,499,612
    $
20,499
 
 
 
XML 22 R11.htm IDEA: XBRL DOCUMENT v3.20.2
Note 5 - Notes Payable and Line of Credit
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Debt Disclosure [Text Block]
Note
5
– Notes Payable and Line of Credit
 
0%
Note Payable dated
October 23, 2017
 
On
October 23, 2017,
the Company amended the existing Nevada Medical Marijuana Production License Agreement (“Amended Production License Agreement”). Per the terms of the Amended Production License Agreement, GB Sciences purchased the remaining percentage of the production license resulting in the
100%
ownership of the license. GB Sciences also received
100%
ownership of the cultivation license included in the original Nevada Medical Marijuana Production License Agreement. In exchange, GB Sciences made
one
-time payment of
$500,000
and issued a
0%
Promissory Note in the amount of
$700,000
payable in equal monthly payments over a
three
-year period commencing on
January 1, 2018.
 
The present value of the note was
$521,067
on the date of its issuance based on an imputed interest rate of
20.3%
and the Company recorded a discount on notes payable of
$178,933.
During the
three
months ended
June 30, 2020
, the Company recorded interest expense of
$7,321
related to amortization of the note discount. The remaining unamortized discount as of
June 30, 2020
was $
(
6,607
)
.
 
The Company has been in default on this note since
June
of
2019,
and as of the date of this report,
fifteen
monthly payments on the note totaling
$291,660
are unpaid. As the result of the default, the Company has accrued penalty interest at the rate of
10%
according to the terms of the Promissory Note. Total penalty interest accrued was
$9,236
for the
three
months ended
June 30, 2020
. If the Company is unable to cure the default within
ten
days of receiving a written notice, the lender will have the option to accelerate the remaining balance owed of $
369,445
, but must notify the Company in writing should it choose to do so. The Company is currently in the process of negotiating a settlement and/or forbearance agreement with the lender and anticipates repayment of the note upon receiving proceeds from the sales of the Company's Teco and Nopah facilities (Note
11
).
 
8%
Line of Credit dated
November 27, 2019
 
In connection with the Binding Letter of Intent dated
November 27, 2019 (
Note
11
), the Company entered into a promissory note and received a line of credit for up to
$470,000
from the purchaser of the Company's membership interest in its Nevada facilities. The purpose of the line of credit is to supply working capital for the Nevada operations. The note matures upon the close of the sale of membership interests. As of
June 30, 2020
, the Company has received $
485,000
in advances under the line of credit, reflecting an informal agreement with the lender to increase the Line of Credit limit by
$15,000.
The Company accrued interest of
$9,641
on the line of credit for the
three
months ended
June 30, 2020
, and the balance of the line of credit was $
485,000
at
June 30, 2020
. Upon the close of the sale of the Teco Facility all principal and interest due under the line of credit will be considered satisfied in full.
 
8%
Note Payable dated
May 7, 2020
 
On
May 7, 2020,
the Company received
$135,000
cash from an investor, net of $(
15,000
) in brokerage fees, and issued a
$150,000
promissory note. The note bears interest at a rate of
8.0%
per annum. The note is to be repaid upon the
first
proceeds received from the
$8,000,000
promissory note related to the sale of the Company's membership interest in GB Sciences Louisiana, LLC (Note
10
), or from the proceeds of the sale of the Teco Facility (Note
11
). As inducement to enter into the note transaction, the Company repriced
8,002,500
preexisting warrants held by the investor to an exercise price of
$0.04.
The repriced warrants were valued at
$272,085
on the date of the transaction using the Black-Scholes Model, which exceeded the value of the warrants prior to the price reduction of
$49,525
by
$222,560.
As the result of the increase in the estimated fair value of the warrants, the Company recorded a full discount on notes payable of $(
150,000
). During the
three
months ended
June 30, 2020
, the Company recorded interest expense of
$151,742
related to the note consisting of accrued interest of
$1,742
and
$150,000
related to amortization of the note discount. Unamortized discount remaining at
June 30, 2020
was
$0.
 
Summary of Notes Payable
 
As of
June 30, 2020
, the following notes payable were recorded in the Company's consolidated balance sheet:
 
   
As of June 30, 2020
 
Short-Term Notes Payable
 
Face Value
   
Discount
   
Carrying Value
 
6% Convertible promissory notes payable (Note 6)
  $
1,257,000
    $
(58,812
)   $
1,198,188
 
8% Convertible Secured Promissory Note dated February 28, 2019, as amended (Note 6)
   
1,271,863
     
(182,276
)    
1,089,587
 
8% Convertible Promissory Note dated April 23, 2019 (Note 6)
   
3,041,500
     
-
     
3,041,500
 
0% Note Payable dated October 23, 2017 (Note 5)
   
369,445
     
(6,607
)    
362,838
 
8% Line of Credit dated November 27, 2019 (Note 5)
   
485,000
     
-
     
485,000
 
8% Note Payable dated May 7, 2020 (Note 5)
   
150,000
     
-
     
150,000
 
Total Short-Term Notes Payable
  $
6,574,808
    $
(247,695
)   $
6,327,113
 
XML 23 R12.htm IDEA: XBRL DOCUMENT v3.20.2
Note 6 - Convertible Notes
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Convertible Debt [Text Block]
Note
6
– Convertible Notes
 
March 2017
$2M
Convertible Note Offering
 
In
March 2017,
the Company entered into a Placement Agent's Agreement with a
third
-party brokerage firm to offer units consisting of a
$1,000
6%
promissory note convertible into
4,000
shares of the Company's common stock at
$0.25
per share and
4,000
warrants to purchase shares of the Company's' common stock at an exercise price of
$0.60
per share for the period of
three
years. Between
March 2017
and
May 2017,
the Company issued short-term Promissory Notes (“Notes”) to various holders with combined face value of
$2,000,000.
The Notes are payable within
three
years of issuance and are convertible into
8,000,000
shares of the Company's common stock. The Company also issued
8,000,000
common stock warrants to the Noteholders. The warrants are exercisable at any time and from time to time before maturity at the option of the holder. Each warrant gives the Noteholder the right to purchase
one
share of common stock of the Company at an exercise price of
$0.60
per share for a period of
three
years.  The Company recorded an aggregate discount on convertible notes of
$1,933,693,
which included
$904,690
related to the relative fair value of beneficial conversion features and
$1,029,003
for the relative fair value of the warrants issued with each note. The fair value of warrants was derived using the Black-Scholes valuation model.
 
July 2017
$7.2M
Convertible Note Offering
 
In
July, 2017,
the Company entered into a Placement Agent's Agreement with a
third
-party brokerage firm to offer units consisting of a
$1,000
6%
promissory note convertible into
4,000
shares of the Company's common stock at
$0.25
per share and
4,000
warrants to purchase shares of the Company's' common stock at an exercise price of
$0.65
per share for the period of
three
years. Between
July 2017
and
December 2017,
the Company issued short-term Promissory Notes (“Notes”) to various holders with combined face value of
$7,201,000.
The Notes are payable within
three
years of issuance and are convertible into
28,804,000
shares of the Company's common stock. The Company also issued
28,804,000
common stock warrants to the Noteholders. The warrants are exercisable at any time and from time to time before maturity at the option of the holder. Each warrant gives the Noteholder the right to purchase
one
share of common stock of the Company at an exercise price of
$0.60
per share for a period of
three
years.The Company recorded an aggregate discount on convertible notes of
$7,092,796,
which included
$3,142,605
related to the relative fair value of beneficial conversion features and
3,950,191
for the relative fair value of the warrants issued with each note. The fair value of warrants was derived using the Black-Scholes valuation model.
 
As of
June 30, 2020
, convertible notes having a carrying value of
$
1,198,188
, net of unamortized discount of 
$ (
58,812
)
remained outstanding from the
March 2017
and
July 2017
note offerings, and accrued interest on the notes is
$228,052.
Discount amortization was
$96,527
for the
three
months ended
June 30, 2020
.
 
8%
Senior Secured
Convertible Promissory Note dated
February 28, 2019
 
On
February 28, 2019,
the Company issued a
$1,500,000
8%
Senior Secured Convertible Promissory Note and entered into the Note Purchase Agreement and Security Agreement with CSW Ventures, L.P. (together, “CSW Note”). The note matures on
August 28, 2020
and is convertible at any time until maturity into
8,823,529
shares of the Company's common stock at
$0.17
per share. Collateral pledged as security for the note includes all of the Company's
100%
membership interests in GB Sciences, Nevada, LLC and GB Sciences Las Vegas, LLC, which together represent substantially all of the Company's cannabis cultivation and production operations and assets located at the Teco facility in Las Vegas, Nevada. The intrinsic value of the beneficial conversion feature resulting from the market price of the Company's common stock in excess of the conversion price was
$176,471
on the date of issuance, and the Company recorded a discount on the CSW Note in that amount.
 
On
May 28, 2019,
the Company received notice from CSW Ventures, L.P. of the conversion of a total of
$170,000
of the principal balance of the
8%
Senior Secured Promissory Note dated
February 28, 2019.
Accordingly, the Company issued
1,000,000
shares of its common stock based on a
$0.17
per share conversion price. In connection with the conversions, $
17,225
in unamortized discount was recorded as interest expense and the Company reduced the carrying amount of convertible notes payable by
$152,775.
After conversion, the remaining balance outstanding was
$1,330,000.
 
On
July 12, 2019,
the Company entered into the Amendment to Note Documents and the Amended and Restated
8%
Senior Secured Promissory Note (together, “Amended CSW Note”). The Amended CSW Note increased the note balance by
$100,000
to reflect an additional
$100,000
advanced to the Company on
July 12, 2019,
by
$41,863
to add accrued interest to date to the principal balance, and decreased the conversion price to
$0.11
per share, with the remaining terms substantially unchanged from the original CSW Note.
 
We evaluated the modification under the guidance in ASC
470
-
50
and determined that the amendment represents an extinguishment because the change in the fair value of the conversion feature exceeded
10%
of the carrying value of the CSW Note on the amendment date. The carrying value of the amended note on the date of extinguishment was
$1,338,057,
net of a beneficial conversion feature discount of
$133,806,
and we recorded a loss on extinguishment of
$124,158.
 
On
August 1, 2019,
the Company received notice from CSW Ventures, L.P. of the conversion of a total of $
110,000
of the principal balance of the Amended CSW Note at
$0.11
per share. Accordingly, the Company issued
1,000,000
shares of its common stock. In connection with the conversions,
$9,579
in unamortized discount was recorded as interest expense and the Company has reduced the carrying amount of convertible notes payable by
$100,421.
After conversion, the remaining balance outstanding was $
1,361,863.
 
On
October 23, 2019,
the Company entered into the Amendment to Promissory Note. The
October 23, 2019
amendment decreased the conversion price to
$0.08
per share, with the remaining terms substantially unchanged from the Amended CSW Note.
 
We evaluated the modification under the guidance in ASC
470
-
50
and determined that the amendment represents an extinguishment because the change in the fair value of the conversion feature exceeded
10%
of the carrying value of the Amended CSW Note immediately prior to the
2nd
Amended CSW Note. The carrying value of the Amended CSW Note on the date of extinguishment was
$1,269,067,
net of a beneficial conversion feature discount of
$92,796,
and we recorded a loss on extinguishment of
$92,796.
 
On
November 27, 2019,
the Company entered into the Second Amendment to Note Documents and the Second Amended and Restated
8%
Senior Secured Promissory Note (together,
“2nd
Amended CSW Note”). The
2nd
Amended CSW Note decreased the conversion price to
$0.04
per share and increased the note balance by
$30,000
to reflect an advance received on that date, with the remaining terms substantially unchanged from the Amended CSW Note.
 
 We evaluated the modification under the guidance in ASC
470
-
50
and determined that the
2nd
Amended CSW Note represents an extinguishment because the change in the fair value of the conversion feature exceeded
10%
of the carrying value of the Amended CSW Note immediately prior to the
2nd
Amended CSW Note; however,
no
loss on extinguishment was recorded because the net consideration paid for the
2nd
Amended CSW Note was equal to the extinguished carrying value of the Amended CSW Note. The carrying value of the Amended CSW Note on the date of extinguishment was
$1,361,863.
 
On
December 16, 2019,
the Company received notice from CSW Ventures, L.P. of the conversion of a total of
$120,000
of the principal balance of the Amended CSW Note at
$0.04
per share and we issued
3,000,000
shares of common stock. In connection with the conversions,
$57,551
in unamortized discount was recorded as interest expense, and the Company has reduced the carrying amount of convertible notes payable by
$62,449.
After conversion, the remaining balance outstanding was
$1,271,863
and the carrying amount of the note was
$687,021,
net of
$584,842
in unamortized discount from the beneficial conversion feature.
 
During the
three
months ended
June 30, 2020
, we recorded interest expense of
$252,573
related to the CSW Note and its amendments consisting of 
$25,367
in accrued interest and 
$227,206
related to amortization of the note discount. As of
June 30, 2020
, the carrying amount of the CSW Note was $
1,089,587
, net of unamortized discount of $
(
182,276
)
.
 
The Company is in default on the amended CSW Note due to non-payment of the quarterly interest payments due on
October 1, 2019,
January 1, 2020, 
March 1, 2020,
and
June 1, 2020,
and for nonpayment of an income tax liability related to the
March 31, 2018
tax year. The terms of the note provide that the Company has
5
days to cure a default caused by nonpayment of interest and
ten
days to cure a default caused by noncompliance with affirmative or negative debt covenants. The lender has agreed to provide forbearance of the defaults in connection with the sale of the Teco facilities, and the Company anticipates that the CSW Note will be settled in full upon close of the sale of the Company's interests in its Nevada operations to an entity affiliated with CSW Ventures, L.P. (Note
11
).
 
8%
Convertible Promissory Note dated
April 23, 2019
 
On
April 23, 2019,
the Company entered into the Note Purchase Agreement with Iliad Research and Trading, L.P. ("Iliad") and issued an
8%
Convertible Promissory Note with a face value of
$2,765,000.
The Note was issued with original issue discount of
$265,000
and is convertible into shares of the Company's common stock at a price of
$0.17
per share at the option of the note holder at any time until the Note is repaid. The Note matures on
April 22, 2020.
A total discount of
$440,000
was recorded on the note, which includes
$265,000
of original issue discount and
$175,000
in fees paid to brokers.
 
During the year ended
March 31, 2020,
the Company honored the conversion of a total of a total of
$125,000
of accrued interest on the Iliad Note at reduced conversion rates. On
October 30, 2019,
the Company received notice of the conversion of
$75,000
at
$0.06
per share and issued
1,250,000
shares of its common stock. The fair value of the shares issued exceeded the fair value of the shares issuable under the original terms of the Note by
$64,706,
and the Company recorded an induced conversion expense. On
November 18, 2019,
the Company received notice of the conversion of
$50,000
of the note balance at
$0.0375
per share and issued
1,333,333
shares of its common stock.
 
On
April 22, 2020,
the Company failed to make payment of the principal and accrued interest due under the Iliad Note, resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by
10%.
As the result of the default, Company recorded an expense of
$9,559
related to a
10%
increase in the accrued interest balance, which is recorded in interest expense, and
$276,500
related to the
10%
increase in the principal balance, which is recorded in debt default penalty and other expense. As of
June 30, 2020
, the principal balance due under the note was $
3,041,500
, including the
10%
penalty increase to the principal balance, and accrued interest was
$192,649,
including an increase of
$9,559
attributable to the
10%
default penalty.
 
During the
three
months ended
June 30, 2020
, interest expense related to the note was
$130,659,
of which
$29,831
was amortization of the note discount and
$100,828
was interest accrued at the pre-default rate of
8.0%
through
April 22, 2020,
and at the default rate of
15.0%
for the period from
April 23, 2020
through
June 30, 2020
.
 
On
May 20, 2020,
Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does
not
intend to defend the lawsuit. On
July 14, 2020,
the Court entered judgment in favor of Iliad in the amount of
$3,264,594
and the judgment accrues interest at the default rate of
15%
per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has
not
been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC. 
XML 24 R13.htm IDEA: XBRL DOCUMENT v3.20.2
Note 7 - Capital Transactions
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Stockholders' Equity Note Disclosure [Text Block]
Note
7
– Capital Transactions
 
Sale of Common Stock and Exercise of Warrants
 
On
April 1, 2020,
the Company entered into the Advisory Agreement with its brokers and effected a temporary decrease in the exercise price of the Company's outstanding warrants to
$0.03
-
$.05
per share. As a result of the price reduction, the Company received notice of the exercise of
4,991,084
warrants during the 
three
months ended
June 30, 2020
and received proceeds of $
136,081
, net of brokerage fees of $
(
15,121
)
.
 
At
June 30, 2020
,
79,547,077
warrants at exercise prices ranging from
$0.25
to
$1.00
per share and
13,366,334
options with a weighted average exercise price of
$0.28
were outstanding.
 
XML 25 R14.htm IDEA: XBRL DOCUMENT v3.20.2
Note 8 - Commitments and Contingencies
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Commitments and Contingencies Disclosure [Text Block]
Note
8
– Commitments and Contingencies
 
On
September 18, 2017
GB Sciences finalized its agreement with Louisiana State University (“LSU”) AgCenter to be the sole operator of the LSU's medical marijuana program. The LSU Board of Supervisors entered into a
five
-year agreement that has an option to renew for
two
additional
five
-year terms with GB Sciences.
 
The contract includes the Company's commitment to make an annual research investments of
$500,000
to the LSU AgCenter. The Company retained its
50%
interest in the research relationship with LSU after the sale of its membership interest in GB Sciences Louisiana, LLC (Note
10
), and accordingly remains obligated for
$250,000
of the
$500,000
annual research investment for
three
years, or a total commitment of
$750,000.
The research investment is paid annually in
September
and amortized over a
one
-year period. On
August 4, 2020,
the Company received its
first
payment under the Wellcana Note Receivable, net of the
$250,000
research contribution due for the
twelve
month period ended
September 30, 2020,
and our commitment for that
twelve
month period was paid by the purchaser with the funds withheld from the note payment. The monetary contributions will be used to conduct research on plant varieties, compounds, extraction techniques and delivery methods that could generate additional revenue through discoveries that are subject to intellectual property rights, of which AgCenter would retain
50%
of those rights with the other
50%
retained
25%
each by the Company and by GB Sciences Louisiana, LLC.
 
On
August 24, 2020,
the Company entered into a letter of intent with the purchaser to discount the note receivable in exchange for accelerated payment. Pursuant to the letter of intent, the purchaser will assume the annual
$250,000
research contribution commitment to LSU and the Company will retain
no
rights in the intellectual property developed under the research relationship (Note
10
).
 
Tara “Dee” Russell filed a Charge of Discrimination with the Nevada Equal Rights Commission ("NERC") against the Company on
April 2, 2019,
alleging that she was subjected to sexual harassment and retaliatory discharge. The Company received the Notice of Charge of Discrimination on or about
May 15, 2019.
The Company submitted its response to the Notice of Discrimination Charge on
July 26, 2019.
It is the Company's position that Ms. Russel was
not
an employee of the Company, but rather was an independent contractor. The Company intends to aggressively respond to the charge. To date, the NERC has
not
issued a ruling regarding the charge.
 
On
April 22, 2020,
the Company failed to repay any of the outstanding balance of the Convertible Promissory Note Payable to Iliad Research and Trading, L.P. (Note
6
), resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by
10%
and the Company recorded expense of
$286,059
related to the default. As of
June 30, 2020
, the total balance due under the note was
$3,234,149
including accrued interest of
$192,649.
 
On
May 20, 2020,
Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does
not
intend to defend the lawsuit. On
July 14, 2020,
the Court entered judgment in favor of Iliad in the amount of
$3,264,594
and the judgment accrues interest at the default rate of
15%
per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has
not
been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC. 
 
On
April 22, 2020,
the Company was served notice of a lawsuit filed in the Eighth Judicial District Court in Clark County, Nevada, filed by a contractor who had been hired to perform architectural and design services. The lawsuit demands payment of
$73,050
for the services provided. The Company intends to negotiate a settlement and the full amount demanded in the lawsuit of
$73,050
is accrued in accounts payable as of
June 30, 2020
.
 
From time to time, the Company
may
become involved in certain legal proceedings and claims which arise in the ordinary course of business. In management's opinion, based on consultations with outside counsel, the results of any of these ordinary course matters, individually and in the aggregate, are
not
expected to have a material effect on our results of operations, financial condition, or cash flows. As more information becomes available, if management should determine that an unfavorable outcome is probable on such a claim and that the amount of such probable loss that it will incur on that claim is reasonably estimable, the Company would record a reserve for the claim in question. If and when the Company records such a reserve, it could be material and could adversely impact its results of operations, financial condition, and cash flows.
XML 26 R15.htm IDEA: XBRL DOCUMENT v3.20.2
Note 9 - Related Party Transactions
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Related Party Transactions Disclosure [Text Block]
Note
9
– Related Party Transactions
 
As of
June 30, 2020
the Company is indebted to its officers and directors for a total of $
712,176
, consisting of
$447,633
in unpaid wages,
$109,087
in directors' compensation,
$84,497
in unpaid bonuses, and
$70,959
in reimbursements for business expenses.
 
In connection with the sale of membership interest in GB Sciences Louisiana, LLC, the Company issued a note payable in the amount of $
151,923
to John Davis, the Company's former General Counsel and President of GB Sciences Louisiana, LLC, for unpaid fees and bonuses. The note matures upon receipt of the
first
payment from the Wellcana Note Receivable (Note
10
). The note and interest accrued was repaid on
August 4, 2020,
when the related funds were withheld from the
first
payment to the Company under the Wellcana Note Receivable (Note
12
).
XML 27 R16.htm IDEA: XBRL DOCUMENT v3.20.2
Note 10 - Sale of 50% Membership Interest in GB Sciences Louisiana, LLC
3 Months Ended
Jun. 30, 2020
GB Sciences Louisiana, LLC, Sale of Equity [Member]  
Notes to Financial Statements  
Noncontrolling Interest Disclosure [Text Block]
Note
10
– Sale of Membership Interests in GB Sciences Louisiana, LLC
 
On
February 12, 2018,
the Company's wholly-owned subsidiary, GB Sciences Louisiana, LLC (“GBSLA"), issued members' equity interests equal to
15%
in GBSLA to Wellcana Group, LLC (“Wellcana”) for
$3
million. Under the GBSLA operating agreement, Wellcana had an option to make additional capital contributions for the purchase of up to an additional
35%
membership interest in GBSLA, at the rate of
5%
membership interest per
$1
million contributed. To date, Wellcana has made additional cash contributions of
$7.0
million and its non-controlling interest in GBSLA increased to
49.99%.
The capital contributions were used to fund the buildout of the Petroleum Drive facility and to pay for the operating costs of GBSLA.
 
On
November 15, 2019,
the Company entered into the Membership Interest Purchase Agreement ("MIPA") with Wellcana Plus, LLC ("Purchaser"), an affiliate of Wellcana Group, LLC. In consideration for the sale of its remaining
50.01%
membership interest in GBSLA, the Company received the
$8,000,000
Promissory Note  ("Wellcana Note") and
may
receive up to an additional
$8,000,000
in earn-out payments.
 
On
August 24, 2020,
the Company entered into a letter of intent with Wellcana to discount the note receivable in exchange for accelerated payment. Pursuant to the letter of intent, the Company will receive payments totaling
$5,224,423,
including the forgiveness by Wellcana of
$324,423
in liabilities and the payment of
$4,900,000
in cash, on or before
October 15, 2020,
less any cash payments made by Wellcana up to the date of the final payment. Upon receipt of the payment, all liabilities owed to the Company by Wellcana, including the
$8,000,000
note receivable and any potential earn-out payments will be considered satisfied in full. Wellcana will assume the annual
$250,000
research contribution commitment to LSU (Note
8
) and the Company will retain
no
rights in the intellectual property developed under the research relationship. In addition, the Company agreed to reduce the
$750,000
note payment due on
September 1, 2020
to
$500,000.
Should Wellcana fail to make the
$4,900,000
payment, less any offsets from payments made to date on the note receivable, the term sheet will be void and the original terms of the Membership Interest Purchase Agreement and
$8,000,000
note receivable will prevail.
 
As a result of the
August 24, 2020
letter of intent, the Company determined that the amount of the note that was collectible as of 
March 31, 2020
was $
5,224,423
and recorded a loss on modification of note receivable of
$1,895,434
for the year ended
March 31, 2020
. As of
June 30, 2020
, the balance of the note receivable was $
5,224,423
.
 
The Company granted forbearance of the
June 1, 2020
payment from Wellcana in light of the circumstances created by the COVID-
19
epidemic. The payment was received by the Company on
August 4, 2020,
net of the Company's
$250,000
research contribution commitment to LSU for the
twelve
months ended
September 2020 (
Note
8
) and the principal and accrued interest payable to John Davis (Note
5
) totaling
$189,423
as of the date of payment.
 
For all periods presented in the unaudited financial statements, the assets, liabilities, income, and cash flows of GBSLA have been reclassified to discontinued operations.
 
XML 28 R17.htm IDEA: XBRL DOCUMENT v3.20.2
Note 11 - Sale of Membership Interests in Nevada Subsidiaries
3 Months Ended
Jun. 30, 2020
Nevada Subsidiaries [Member]  
Notes to Financial Statements  
Noncontrolling Interest Disclosure [Text Block]
Note
11
– Sale of Membership Interests in Nevada Subsidiaries
 
On
November 15, 2019,
we entered into a Binding Letter of Intent ("Teco LOI") to sell
75%
of the Company's membership interest interests in GB Sciences Nevada, LLC, and GB Sciences Las Vegas, LLC, for
$3.0
million cash upon close and up to an additional
$3.0
million in earn-out payments after close. In connection with the Teco LOI, we entered into a Management Agreement with the purchaser whereby the facilities will be managed by an affiliate of the purchaser until the close of the sale. As part of the transaction, the Company also entered into a Line of Credit of up to
$470,000
with the purchaser (Note
5
) to fund the operations of Teco. The line of credit accrues interest at a rate of
8%
and the Company pledged its interest in the Teco facilities as collateral for the note, subject to the preexisting lien held by CSW Ventures, L.P. in connection with the
8%
Senior Secured Convertible Promissory Note dated
February 28, 2019 (
Note
6
). The Line of Credit will be considered satisfied in full upon close of the sale of the Teco Facility.
 
On
March 24, 2020,
we entered into the Membership Interest Purchase Agreement ("Teco MIPA") which formalized the sale of the Teco Subsidiaries and modified the terms of the sale. Pursuant to the Teco MIPA, the Company will sell
100%
of its membership interests in GBSN and GBLV for
$4,000,000
cash upon close and will receive a
$4,000,000
8%
promissory note to be paid in monthly installments over
36
months.
 
On
July 24, 2020,
the Company entered into the Loan Agreement,
8%
Secured Promissory Note, and Security Agreement (together, the
"July 24
Note") with AJE Management, LLC, which established a revolving loan of up to
$500,000
that the Company
may
draw on from time to time. The loan is collateralized by the Teco Facility, subject to the preexisting lien held by CSW Ventures, L.P. in connection with the
8%
Senior Secured Convertible Promissory Note dated
February 28, 2019 (
Note
6
). Any advances will be made at the sole discretion of the lender following a written request made by the Company. Contemporaneously with the Loan Agreement, the Company and AJE Management entered into the Amendment to the Membership Interest Purchase Agreement with AJE Management. The amendment provides that any balances outstanding under the
July 24
Note at the time of the close of the sale of the Teco Facility will be forgiven in exchange for a reduction to the
$4,000,000
note receivable that the Company will receive as consideration for the sale of the Teco Facility. The reduction to the note receivable will be equal to
3
times the balance outstanding under the
July 24
Note on the date of the close of the sale of the Teco Facility. As of the date of this report, the Company has
not
received any advances under the
July 24
Note.
 
The sale is expected to close upon the successful transfer of the Nevada cultivation and production licenses. The transfer of cannabis licenses in the State of Nevada has been subject to an indefinite moratorium since
October 2019.
In a meeting held on
July 21, 2020,
the Nevada Cannabis Compliance Board lifted the moratorium, however, the board has indicated that there are over
90
requests pending and it will take up to several months to process the entire backlog of pending license transfers. Based on this information, we cannot provide any assurances as to the timing of the close of the sale. The lifting of the moratorium and processing of cannabis license transfers have been delayed by the COVID-
19
pandemic and could be further delayed if the pandemic continues.
 
The Company also holds a Nevada license for cultivation of medical marijuana located in Sandy Valley, Nevada (the “Nopah License”). The license is owned by the Company's wholly owned subsidiary, GB Sciences Nopah, LLC ("Nopah"). Operations have
not
begun under the Nopah License. On
November 27, 2019,
the Company entered into a Binding Letter of Intent to sell its
100%
interest in GB Sciences Nopah, LLC (the “Nopah LOI”), with the transaction closing upon transfer of the Nopah License. As consideration for the transfer of the license, the Company will receive
$300,000
and the purchaser will pay all expenses related to the upkeep and maintenence of the Nopah License. The transfer of the Nopah License is subject to the same restrictions on license transfers discussed above.
XML 29 R18.htm IDEA: XBRL DOCUMENT v3.20.2
Note 12 - Subsequent Events
3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Subsequent Events [Text Block]
Note
12
– Subsequent Events
 
Capital Transactions
 
On
July 24, 2020,
the Company entered into the Loan Agreement,
8%
Secured Promissory Note, and Security Agreement (together, the
"July 24
Note") with AJE Management, LLC, which established a revolving loan of up to
$500,000
that the Company
may
draw on from time to time. The loan is collateralized by the Teco Facility, subject to the pre-existing lien held by CSW Ventures, L.P. in connection with the
8%
Senior Secured Convertible Promissory Note dated
February 28, 2019 (
Note
6
). Any advances will be made at the sole discretion of the lender following a written request made by the Company. Contemporaneously with the Loan Agreement, the Company and AJE Management entered into the Amendment to the Membership Interest Purchase Agreement with AJE Management. The amendment provides that any balances outstanding under the
July 24
Note at the time of the close of the sale of the Teco Facility will be forgiven in exchange for a reduction to the
$4,000,000
note receivable that the Company will receive as consideration for the sale of the Teco Facility (Note
11
). The reduction to the note receivable will be equal to
3
times the balance outstanding under the
July 24
Note on the date of the close of the sale of the Teco Facility. As of the date of this report, the Company has
not
received any advances under the
July 24
Note.
 
 
Note Receivable
 
The Company granted forbearance of the
June 1, 2020
payment to Wellcana in light of the circumstances created by the COVID-
19
epidemic. The payment was received by the Company on
August 4, 2020,
net of the Company's annual
$250,000
research contribution commitment to LSU (Note
10
) and the principal and accrued interest payable to John Davis (Note
5
) totaling
$189,423
as of the date of payment.
 
On
August 24, 2020,
the Company entered into a letter of intent with Wellcana to discount the note receivable in exchange for accelerated payment. Pursuant to the letter of intent, the Company will receive payments totaling
$5,224,423,
including the forgiveness by Wellcana of
$324,423
in liabilities and the payment of
$4,900,000
in cash, on or before
October 15, 2020,
less any cash payments made by Wellcana up to the date of the final payment. Upon receipt of the payment, all liabilities owed to the Company by Wellcana, including the
$8,000,000
note receivable and any potential earn-out payments will be considered satisfied in full. Wellcana will assume the annual
$250,000
research contribution commitment to LSU (Note
10
) and the Company will retain
no
rights in the intellectual property developed under the research relationship. In addition, the Company agreed to reduce the
$750,000
note payment due on
September 1, 2020
to
$500,000.
Should Wellcana fail to make the
$4,900,000
payment, less any offsets from payments made to date on the note receivable, the term sheet will be void and the original terms of the Membership Interest Purchase Agreement and
$8,000,000
note receivable will prevail.
 
On
August 31, 2020,
the Company granted a
30
-day forbearance of the
$500,000
payment due on
September 1, 2020.
Any payments received prior to
October 15, 2020
will be applied to the
$4,900,000
balance due under the
August 24, 2020
letter of intent.
 
Litigation
 
On
April 22, 2020,
the Company failed to repay any of the outstanding balance of the Convertible Promissory Note Payable to Iliad Research and Trading, L.P. (Note
6
), resulting in a default. Pursuant to the terms of the Promissory Note, upon the default, the principal and accrued interest balances outstanding increased by
10%
and the Company recorded expense of
$286,059
related to the default. As of
June 30, 2020,
the total balance due under the note was
$3,234,149
including accrued interest of
$192,649.
 
On
May 20, 2020,
Iliad filed a lawsuit against the Company in the Third Judicial District Court of Salt Lake County in the State of Utah demanding repayment of the note. The lawsuit further seeks to compel the Company to participate in arbitration pursuant to the arbitration provisions contained within the Note Purchase Agreement and to prohibit the Company to raise funds through the issuance of its common stock unless the note is paid in full simultaneously with such issuance. The Company filed a confession of judgment in response to the complaint and does
not
intend to defend the lawsuit. On
July 14, 2020,
the Court entered judgment in favor of Iliad in the amount of
$3,264,594
and the judgment accrues interest at the default rate of
15%
per annum. The Company will also be responsible for reasonable attorney's fees and costs incurred by Iliad for obtaining and collecting on the judgment. The amount of such fees has
not
been established as of the date of this report. The Company believes it will have sufficient resources to repay the Iliad Note from the proceeds of the sale of the Teco Facility and the note receivable therefrom, along with the proceeds of the note receivable from Wellcana Group from the sale of the Company's membership interest in GB Sciences Louisiana, LLC. 
 
XML 30 R19.htm IDEA: XBRL DOCUMENT v3.20.2
Significant Accounting Policies (Policies)
3 Months Ended
Jun. 30, 2020
Accounting Policies [Abstract]  
Basis of Accounting, Policy [Policy Text Block]
Basis of Presentation
 
The accompanying unaudited interim condensed consolidated financial statements of GB Sciences, Inc. (the “Company,” “We” or “Us”) have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form
10
-Q and Article
8
of Regulations S-
X.
Accordingly, they do
not
include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the periods presented are
not
necessarily indicative of the results that
may
be expected for the year ending
March 31, 2021.
The balance sheet at 
March 31, 2020
has been derived from the audited financial statements at that date but does
not
include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company's annual report on Form
10
-K for the year ended
March 31, 2020
.
Consolidation, Policy [Policy Text Block]
Principles of Consolidation
 
We prepare our consolidated financial statements in accordance with generally accepted accounting principles (GAAP) for the United States of America. Our consolidated financial statements include all operating divisions and majority-owned subsidiaries, reported as a single operating segment, for which we maintain controlling interests. Intercompany accounts and transactions have been eliminated in consolidation. The ownership interest of non-controlling participants in subsidiaries that are
not
wholly owned is included as a separate component of equity. The non-controlling participants' share of the net loss is included as “Net loss attributable to non-controlling interest” on the unaudited consolidated statements of operations.
Use of Estimates, Policy [Policy Text Block]
Use of Estimates
 
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  The Company regularly evaluates estimates and assumptions related to allowances for doubtful accounts, inventory valuation and standard cost allocations, valuation of initial right-of-use assets and corresponding lease liabilities, valuation of beneficial conversion features in convertible debt, valuation of the assets and liabilities of discontinued operations, stock-based compensation expense, purchased intangible asset valuations, deferred income tax asset valuation allowances, uncertain tax positions, litigation and other loss contingencies.  These estimates and assumptions are based on current facts, historical experience and various other factors that the Company believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of costs and expenses that are
not
readily apparent from other sources. The actual results the Company experiences
may
differ materially and adversely from these estimates.
Reclassification, Comparability Adjustment [Policy Text Block]
Reclassifications
 
Certain reclassifications have been made to the comparative period amounts to conform to the current period presentation. Certain items on the unaudited statements of operations and cash flows have been reclassified to conform with current period presentation. The assets, liabilities, income, and cash flows of GB Sciences Louisiana, LLC have been separated from the comparative period amounts to confirm to the current period presentation as discontinued operations as the result of the sale of the Company's interest in GB Sciences Louisiana, LLC (Note
10
). The reclassifications had
no
effect on the reported financial position, results of operations or cash flows of the Company.
Discontinued Operations, Policy [Policy Text Block]
Discontinued Operations
 
Discontinued operations comprise those activities that were disposed of during the period or which were classified as held for sale at the end of the period and represent a separate major line of business or geographical area that can be clearly distinguished for operational and financial reporting purposes.
 
There were
no
assets or liabilities of discontinued operations included in the Company's condensed consolidated balance sheets as of
June 30, 2020
and
March 31, 2020
.
 
The revenues and expenses associated with discontinued operations included in our condensed consolidated statements of operations for the
three
months ended
June 30, 2020
and
2019
were as follows:
 
   
For the Three Months Ended June 30,
 
   
2020
   
2019
 
   
Continuing
   
Discontinued
   
Total
   
Continuing
   
Discontinued
   
Total
 
Sales revenue
  $
551,197
    $
-
    $
551,197
    $
910,676
    $
-
    $
910,676
 
Cost of goods sold
   
(491,795
)    
-
     
(491,795
)    
(624,369
)    
-
     
(624,369
)
Gross profit
   
59,402
     
-
     
59,402
     
286,307
     
-
     
286,307
 
General and administrative expenses
   
804,708
     
-
     
804,708
     
2,065,549
     
201,840
     
2,267,389
 
LOSS FROM OPERATIONS
   
(745,306
)    
-
     
(745,306
)    
(1,779,242
)    
(201,840
)    
(1,981,082
)
OTHER EXPENSE
                                               
Interest expense
   
(795,313
)    
-
     
(795,313
)    
(437,815
)    
(62,594
)    
(500,409
)
Debt default penalty    
(286,059
)    
-
     
(286,059
)    
-
     
-
     
-
 
Other expense
   
(11,182
)    
-
     
(11,182
)    
-
     
-
     
-
 
Total other expense
   
(1,092,554
)    
-
     
(1,092,554
)    
(437,815
)    
(62,594
)    
(500,409
)
LOSS BEFORE INCOME TAXES
   
(1,837,860
)    
-
     
(1,837,860
)    
(2,217,057
)    
(264,434
)    
(2,481,491
)
Income tax expense
   
(8,840
)    
-
     
(8,840
)    
(57,392
)    
-
     
(57,392
)
NET LOSS
  $
(1,846,700
)
  $
-
    $
(1,846,700
)
  $
(2,274,449
)
  $
(264,434
)
  $
(2,538,883
)
 
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block]
Long-Lived Assets
 
Property and equipment comprise a significant portion of our total assets. We evaluate the carrying value of property and equipment if impairment indicators are present or if other circumstances indicate that impairment
may
exist under authoritative guidance. The annual testing date is
March 31.
When management believes impairment indicators
may
exist, projections of the undiscounted future cash flows associated with the use of and eventual disposition of property and equipment are prepared. If the projections indicate that the carrying value of the property and equipment are
not
recoverable, we reduce the carrying values to fair value. These impairment tests are heavily influenced by assumptions and estimates that are subject to change as additional information becomes available. 
No
indicators of impairment were identified by the Company as of
June 30, 2020
.
Inventory, Policy [Policy Text Block]
Inventory
 
We value our inventory at the lower of the actual cost of our inventory, as determined using the
first
-in,
first
-out method, or its current estimated net realizable value. We periodically review our physical inventory for excess, obsolete, and potentially impaired items and reserve accordingly. Our reserve estimate for excess and obsolete inventory is based on expected future use.
Debt, Policy [Policy Text Block]
Beneficial Conversion Feature of Convertible Notes Payable
 
The Company accounts for convertible notes payable in accordance with the guidelines established by the Financial Accounting Standards Board's (“FASB”) Accounting Standards Codification (“ASC”) Topic
470
-
20,
 Debt with Conversion and Other Options and Emerging Issues Task Force (“EITF”)
00
-
27,
 “Application of Issue
No.
98
-
5
to Certain Convertible Instruments”.  A beneficial conversion feature (“BCF”) exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after
first
considering the allocation of a portion of the note proceeds to the fair value of any attached equity instruments, if any related equity instruments were granted with the debt. In accordance with this guidance, the BCF of a convertible note is measured by allocating a portion of the note's proceeds to the warrants, if applicable, and as a reduction of the carrying amount of the convertible note equal to the intrinsic value of the conversion feature, both of which are credited to additional paid-in-capital. The Company calculates the fair value of warrants issued with the convertible notes using the Black-Scholes valuation model and uses the same assumptions for valuing any employee options in accordance with ASC Topic
718
Compensation – Stock Compensation. The only difference is that the contractual life of the warrants is used.
 
The value of the proceeds received from a convertible note is then allocated between the conversion features and warrants on a relative fair value basis. The allocated fair value is recorded in the financial statements as a debt discount (premium) from the face amount of the note and such discount is amortized over the expected term of the convertible note (or to the conversion date of the note, if sooner) and is charged to interest expense.
Revenue from Contract with Customer [Policy Text Block]
Revenue Recognition
 
The FASB issued Accounting Standards Codification (“ASC”)
606
as guidance on the recognition of revenue from contracts with customers. Revenue recognition depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The guidance permits
two
methods of adoption: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). The Company adopted the guidance on
April 1, 2018
and applied the cumulative catch-up transition method.
 
The Company's only current revenue source is from sales of cannabis, a distinct physical good. Under ASC
606,
the Company is required to separately identify each performance obligation resulting from its contracts from customers, which
may
be a good or a service. A contract
may
contain
one
or more performance obligations. All of the Company's contracts with customers, past and present, contain only a single performance obligation, the delivery of distinct physical goods. Because fulfillment of the company's performance obligation to the customer under ASC
606
results in the same timing of revenue recognition as under the previous guidance (i.e. revenue is recognized upon delivery of physical goods), the Company did
not
record any material adjustment to report the cumulative effect of initial application of the guidance.
Earnings Per Share, Policy [Policy Text Block]
Earnings/(loss) per Share
 
 
The Company's basic loss per share has been calculated using the weighted average number of common shares outstanding during the period. The Company had
153,412,936
and
158,404,020
potentially dilutive common shares at 
June 30, 2020
and
March 31, 2020
, respectively. However, such common stock equivalents were
not
included in the computation of diluted net loss per share as their inclusion would have been anti-dilutive.
New Accounting Pronouncements, Policy [Policy Text Block]
Recent Accounting Pronouncements
 
Recently Adopted Standards
 
In
June 2016,
the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU")
No.
2016
-
13,
"Financial Instruments—Credit Losses (Topic
326
): Measurement of Credit Losses on Financial Instruments" ("ASU
2016
-
13"
).  Financial Instruments—Credit Losses (Topic
326
) amends guideline on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities.  For assets held at amortized cost basis, Topic
326
eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses.  The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected.  For available-for-sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic
326
will require that credit losses be presented as an allowance rather than as a write-down.  ASU
2016
-
13
affects entities holding financial assets and net investment in leases that are
not
accounted for at fair value through net income.  The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets
not
excluded from the scope that have the contractual right to receive cash.  The amendments in this ASU are effective for smaller reporting companies for fiscal years beginning after
December 15, 2022,
including interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on its financial statements.
 
In
August 2018,
the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU)
2018
-
13,
Fair Value Measurement (Topic
820
): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement
.” This ASU eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. The standard is effective for all entities for financial statements issued for fiscal years beginning after
December 15, 2019,
and interim periods within those fiscal years. The Company adopted the standard on
April 1, 2020.
The adoption of this guidance did
not
have a material impact on the Company's financial statements.
 
All other newly issued accounting pronouncements but
not
yet effective have been deemed either immaterial or
not
applicable.
XML 31 R20.htm IDEA: XBRL DOCUMENT v3.20.2
Note 1 - Background and Significant Accounting Policies (Tables)
3 Months Ended
Jun. 30, 2020
Notes Tables  
Disposal Groups, Including Discontinued Operations [Table Text Block]
   
For the Three Months Ended June 30,
 
   
2020
   
2019
 
   
Continuing
   
Discontinued
   
Total
   
Continuing
   
Discontinued
   
Total
 
Sales revenue
  $
551,197
    $
-
    $
551,197
    $
910,676
    $
-
    $
910,676
 
Cost of goods sold
   
(491,795
)    
-
     
(491,795
)    
(624,369
)    
-
     
(624,369
)
Gross profit
   
59,402
     
-
     
59,402
     
286,307
     
-
     
286,307
 
General and administrative expenses
   
804,708
     
-
     
804,708
     
2,065,549
     
201,840
     
2,267,389
 
LOSS FROM OPERATIONS
   
(745,306
)    
-
     
(745,306
)    
(1,779,242
)    
(201,840
)    
(1,981,082
)
OTHER EXPENSE
                                               
Interest expense
   
(795,313
)    
-
     
(795,313
)    
(437,815
)    
(62,594
)    
(500,409
)
Debt default penalty    
(286,059
)    
-
     
(286,059
)    
-
     
-
     
-
 
Other expense
   
(11,182
)    
-
     
(11,182
)    
-
     
-
     
-
 
Total other expense
   
(1,092,554
)    
-
     
(1,092,554
)    
(437,815
)    
(62,594
)    
(500,409
)
LOSS BEFORE INCOME TAXES
   
(1,837,860
)    
-
     
(1,837,860
)    
(2,217,057
)    
(264,434
)    
(2,481,491
)
Income tax expense
   
(8,840
)    
-
     
(8,840
)    
(57,392
)    
-
     
(57,392
)
NET LOSS
  $
(1,846,700
)
  $
-
    $
(1,846,700
)
  $
(2,274,449
)
  $
(264,434
)
  $
(2,538,883
)
XML 32 R21.htm IDEA: XBRL DOCUMENT v3.20.2
Note 3 - Inventory (Tables)
3 Months Ended
Jun. 30, 2020
Notes Tables  
Schedule of Inventory, Current [Table Text Block]
   
June 30, 2020
   
March 31, 2020
 
                 
Raw materials
  $
129,133
    $
91,465
 
Work in progress
   
923,737
    $
1,166,511
 
Finished goods
   
619,491
    $
466,319
 
Subtotal
   
1,672,361
     
1,724,295
 
Allowance to reduce inventory to net realizable value
   
(126,470
)    
(278,456
)
Total inventory, net
  $
1,545,891
    $
1,445,839
 
XML 33 R22.htm IDEA: XBRL DOCUMENT v3.20.2
Note 4 - Leases (Tables)
3 Months Ended
Jun. 30, 2020
Notes Tables  
Operating and Finance Lease Liabilities, Maturity [Table Text Block]
Year Ending
   
 
 
 
Operating
 
March 31,
 
Finance Leases
   
Leases
 
                 
2021 (9 months)
  $
422,801
    $
8,836
 
2022
   
544,296
     
11,779
 
2023
   
560,625
     
11,779
 
2024
   
577,444
     
3,926
 
2025
   
594,767
     
-
 
Thereafter
   
3,781,101
     
-
 
Total minimum lease payments
   
6,481,034
     
36,320
 
Less: Amount representing interest
   
(2,835,211
)    
(8,242
)
Present value of minimum lease payments
   
3,645,823
     
28,078
 
Less: Current maturities of capital lease obligations
   
(146,211
)    
(7,579
)
Long-term capital lease obligations
  $
3,499,612
    $
20,499
 
XML 34 R23.htm IDEA: XBRL DOCUMENT v3.20.2
Note 5 - Notes Payable and Line of Credit (Tables)
3 Months Ended
Jun. 30, 2020
Notes Tables  
Schedule of Debt [Table Text Block]
   
As of June 30, 2020
 
Short-Term Notes Payable
 
Face Value
   
Discount
   
Carrying Value
 
6% Convertible promissory notes payable (Note 6)
  $
1,257,000
    $
(58,812
)   $
1,198,188
 
8% Convertible Secured Promissory Note dated February 28, 2019, as amended (Note 6)
   
1,271,863
     
(182,276
)    
1,089,587
 
8% Convertible Promissory Note dated April 23, 2019 (Note 6)
   
3,041,500
     
-
     
3,041,500
 
0% Note Payable dated October 23, 2017 (Note 5)
   
369,445
     
(6,607
)    
362,838
 
8% Line of Credit dated November 27, 2019 (Note 5)
   
485,000
     
-
     
485,000
 
8% Note Payable dated May 7, 2020 (Note 5)
   
150,000
     
-
     
150,000
 
Total Short-Term Notes Payable
  $
6,574,808
    $
(247,695
)   $
6,327,113
 
XML 35 R24.htm IDEA: XBRL DOCUMENT v3.20.2
Note 1 - Background and Significant Accounting Policies (Details Textual) - USD ($)
$ in Thousands
3 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Mar. 31, 2020
Aug. 15, 2019
Apr. 08, 2018
Mar. 31, 2018
Common Stock, Shares Authorized (in shares) 600,000,000   600,000,000 600,000,000 400,000,000 250,000,000
Impairment of Long-Lived Assets Held-for-use $ 0          
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in shares) 153,412,936 158,404,020        
XML 36 R25.htm IDEA: XBRL DOCUMENT v3.20.2
Note 1 - Background and Significant Accounting Policies - Discontinued Operations (Details) - USD ($)
3 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Sales revenue $ 551,197 $ 910,676
Cost of goods sold (491,795) (624,369)
Gross profit 59,402 286,307
General and administrative expenses 804,708 2,065,549
LOSS FROM OPERATIONS (745,306) (1,779,242)
Interest expense (795,313) (437,815)
Debt default penalty (286,059)
Other expense (11,182)
Total other expense (1,092,554) (437,815)
LOSS BEFORE INCOME TAXES (1,837,860) (2,217,057)
Income tax expense (8,840) (57,392)
Net loss (1,846,700) (2,538,883)
Continuing Operations [Member]    
Sales revenue 551,197 910,676
Cost of goods sold (491,795) (624,369)
Gross profit 59,402 286,307
General and administrative expenses 804,708 2,065,549
LOSS FROM OPERATIONS (745,306) (1,779,242)
Interest expense (795,313) (437,815)
Debt default penalty (286,059)
Other expense (11,182)
Total other expense (1,092,554) (437,815)
LOSS BEFORE INCOME TAXES (1,837,860) (2,217,057)
Income tax expense (8,840) (57,392)
Net loss (1,846,700) (2,274,449)
Discontinued Operations [Member]    
Sales revenue
Cost of goods sold
Gross profit
General and administrative expenses 201,840
LOSS FROM OPERATIONS (201,840)
Interest expense (62,594)
Debt default penalty
Other expense
Total other expense (62,594)
LOSS BEFORE INCOME TAXES (264,434)
Income tax expense
Net loss (264,434)
Segment, Continuing and Discontinued Operations [Member]    
Sales revenue 551,197 910,676
Cost of goods sold (491,795) (624,369)
Gross profit 59,402 286,307
General and administrative expenses 804,708 2,267,389
LOSS FROM OPERATIONS (745,306) (1,981,082)
Interest expense (795,313) (500,409)
Debt default penalty (286,059)
Other expense (11,182)
Total other expense (1,092,554) (500,409)
LOSS BEFORE INCOME TAXES (1,837,860) (2,481,491)
Income tax expense (8,840) (57,392)
Net loss $ (1,846,700) $ (2,538,883)
XML 37 R26.htm IDEA: XBRL DOCUMENT v3.20.2
Note 2 - Going Concern (Details Textual) - USD ($)
3 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Mar. 31, 2020
Retained Earnings (Accumulated Deficit), Ending Balance $ (99,251,168)   $ (97,387,205)
Working Capital Deficit (5,381,534)   $ 3,884,877
Net Cash Provided by (Used in) Operating Activities, Total (323,845) $ (2,631,121)  
Cash Provided by (Used in) Operating Activities, Discontinued Operations $ (883,295)  
XML 38 R27.htm IDEA: XBRL DOCUMENT v3.20.2
Note 3 - Inventory - Schedule of Inventory (Details) - USD ($)
Jun. 30, 2020
Mar. 31, 2020
Raw materials $ 129,133 $ 91,465
Work in progress 923,737 1,166,511
Finished goods 619,491 466,319
Subtotal 1,672,361 1,724,295
Allowance to reduce inventory to net realizable value (126,470) (278,456)
Total inventory, net $ 1,545,891 $ 1,445,839
XML 39 R28.htm IDEA: XBRL DOCUMENT v3.20.2
Note 4 - Leases (Details Textual) - USD ($)
3 Months Ended
Jun. 30, 2020
Mar. 31, 2020
Apr. 01, 2019
Operating Lease, Right-of-Use Asset $ 24,684 $ 26,685  
Operating Lease, Liability, Total $ 28,078    
Lessee, Operating Lease, Discount Rate 17.00%    
Finance Lease Costs $ 143,599    
Finance Lease, Interest Expense 104,924    
Finance Lease, Right-of-Use Asset, Amortization 38,675    
Operating Lease, Cost 3,243    
Operating Lease, Interest Expense 1,242    
Operating Lease, Right-of-Use Asset, Amortization Expense $ 2,001    
Minimum [Member]      
Lessee, Finance Lease, Discount Rate 10.20%    
Maximum [Member]      
Lessee, Finance Lease, Discount Rate 11.50%    
Accounting Standards Update 2016-02 [Member]      
Operating Lease, Right-of-Use Asset     $ 182,624
Operating Lease, Liability, Total     $ 190,173
XML 40 R29.htm IDEA: XBRL DOCUMENT v3.20.2
Note 4 - Leases - Future Minimum Lease Payments (Details) - USD ($)
Jun. 30, 2020
Mar. 31, 2020
2021 (9 months), finance leases $ 422,801  
2021 (9 months), operating leases 8,836  
2022, finance leases 544,296  
2022, operating leases 11,779  
2023, finance leases 560,625  
2023, operating leases 11,779  
2024, finance leases 577,444  
2024, operating leases 3,926  
2025, finance leases 594,767  
2025, operating leases  
Thereafter, finance leases 3,781,101  
Thereafter, operating leases  
Total minimum lease payments, finance leases 6,481,034  
Total minimum lease payments, operating leases 36,320  
Less: Amount representing interest, finance leases (2,835,211)  
Less: Amount representing interest, operating leases (8,242)  
Present value of minimum lease payments, finance leases 3,645,823  
Present value of minimum lease payments, operating leases 28,078  
Less: Current maturities of capital lease obligations, finance leases (146,211) $ (166,769)
Less: Current maturities of capital lease obligations, operating leases (7,579) (7,265)
Finance lease obligations, long term 3,499,612 3,533,090
Operating lease obligations, long term $ 20,499 $ 22,515
XML 41 R30.htm IDEA: XBRL DOCUMENT v3.20.2
Note 5 - Notes Payable and Line of Credit (Details Textual)
3 Months Ended 7 Months Ended
May 07, 2020
USD ($)
$ / shares
shares
Oct. 23, 2017
USD ($)
Sep. 30, 2020
USD ($)
Jun. 30, 2020
USD ($)
Jun. 30, 2019
USD ($)
Jun. 30, 2020
USD ($)
May 06, 2020
USD ($)
Nov. 27, 2019
USD ($)
Oct. 23, 2019
USD ($)
Proceeds from Lines of Credit, Total       $ 5,000        
Payments of Debt Issuance Costs       175,000        
Interest Expense, Debt, Excluding Amortization       17,225        
Amortization of Debt Discount (Premium)       510,885 $ 200,382        
Repriced Preexisting Warrants with Convertible Debt Issuance [Member]                  
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in shares) | shares 8,002,500                
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $ / shares $ 0.04                
Warrants and Rights Outstanding $ 272,085           $ 49,525    
Fair Value Adjustment of Warrants $ 222,560                
Line of Credit [Member]                  
Line of Credit Facility, Maximum Borrowing Capacity               $ 470,000  
Proceeds from Lines of Credit, Total           $ 485,000      
Line of Credit Facility, Maximum Borrowing Capacity, Increased           15,000      
Interest Payable       9,641   9,641      
Long-term Line of Credit, Total       485,000   485,000      
Promissory Note [Member] | The 0% Note Payable Dated October 23, 2017 [Member]                  
Debt Instrument, Interest Rate, Stated Percentage   0.00%              
Debt Instrument, Face Amount   $ 700,000              
Debt Instrument, Term (Year)   3 years              
Debt Instrument, Present Value       $ 521,067   521,067      
Receivable with Imputed Interest, Effective Yield (Interest Rate)       20.30%          
Debt Instrument, Unamortized Discount, Total       $ 6,607   6,607     $ 178,933
Interest Expense, Debt, Total       7,321          
Debt Instrument, Accrued Monthly Payments, Amount       $ 291,660   $ 291,660      
Debt Instrument, Debt Default, Interest Rate Penalty       10.00%   10.00%      
Debt Instrument, Debt Default, Accrued Interest       $ 9,236   $ 9,236      
Days to Cure Breach of Default After Notification From Lender       10   10      
Convertible Debt [Member] | The 8% Note Payable dated May 7, 2020 [Member]                  
Debt Instrument, Interest Rate, Stated Percentage 8.00%                
Debt Instrument, Face Amount $ 150,000                
Debt Instrument, Unamortized Discount, Total 150,000     $ 0   $ 0      
Proceeds from Issuance of Long-term Debt, Net 135,000                
Payments of Debt Issuance Costs $ 15,000                
Interest and Debt Expense, Total       151,742          
Interest Expense, Debt, Excluding Amortization       1,742          
Amortization of Debt Discount (Premium)       $ 150,000          
Convertible Debt [Member] | The 8% Note Payable dated May 7, 2020 [Member] | Forecast [Member]                  
Repayments of Long-term Debt, Total     $ 8,000,000,000,000            
Nevada Medical Marijuana Production License Agreement [Member]                  
Payments to Acquire License   $ 500,000              
Nevada Medical Marijuana Production License Agreement [Member] | Production License [Member]                  
Ownership of Licence   100.00%              
Nevada Medical Marijuana Production License Agreement [Member] | Cultivation License [Member]                  
Ownership of Licence   100.00%              
XML 42 R31.htm IDEA: XBRL DOCUMENT v3.20.2
Note 5 - Notes Payable and Line of Credit - Schedule of Debt Payable (Details) - USD ($)
Jun. 30, 2020
Mar. 31, 2020
Apr. 23, 2019
Discount, short-term notes payable    
Convertible Notes Payable [Member] | The 6% Note Payable Due November 30, 2018 [Member]      
Face Value, short-term notes payable $ 1,257,000    
Discount, short-term notes payable (58,812)    
Carrying Value, short-term notes payable 1,198,188    
Convertible Notes Payable [Member] | The 8% Convertible Promissory Note Dated April 23, 2019 [Member]      
Face Value, short-term notes payable 3,041,500   $ 2,765,000
Discount, short-term notes payable    
Carrying Value, short-term notes payable 3,041,500    
Convertible Notes Payable [Member] | The 0% Note Payable Dated October 23, 2017 [Member]      
Face Value, short-term notes payable 369,445    
Discount, short-term notes payable (6,607)    
Carrying Value, short-term notes payable 362,838    
Convertible Notes Payable [Member] | The 8% Convertible Promissory Note Issued to Investor on May 7, 2020 [Member]      
Face Value, short-term notes payable 150,000    
Discount, short-term notes payable    
Carrying Value, short-term notes payable 150,000    
Senior Secured Convertible Promissory Note [Member] | The Amended 8% Senior Secured Convertible Promissory Note Dated February 28, 2019 [Member]      
Face Value, short-term notes payable 1,271,863    
Discount, short-term notes payable (182,276)    
Carrying Value, short-term notes payable 1,089,587    
Line of Credit [Member]      
Face Value, short-term notes payable 485,000    
Discount, short-term notes payable    
Carrying Value, short-term notes payable 485,000    
Promissory Note [Member]      
Face Value, short-term notes payable 6,574,808    
Discount, short-term notes payable (247,695)    
Carrying Value, short-term notes payable $ 6,327,113    
XML 43 R32.htm IDEA: XBRL DOCUMENT v3.20.2
Note 6 - Convertible Notes (Details Textual)
1 Months Ended 3 Months Ended 6 Months Ended 12 Months Ended
Jul. 14, 2020
USD ($)
Apr. 22, 2020
USD ($)
Dec. 16, 2019
USD ($)
$ / shares
shares
Nov. 27, 2019
USD ($)
$ / shares
Nov. 18, 2019
USD ($)
$ / shares
shares
Oct. 30, 2019
USD ($)
$ / shares
shares
Oct. 23, 2019
USD ($)
$ / shares
Aug. 01, 2019
USD ($)
$ / shares
shares
Jul. 12, 2019
USD ($)
$ / shares
May 28, 2019
USD ($)
$ / shares
shares
Apr. 23, 2019
USD ($)
$ / shares
Feb. 28, 2019
USD ($)
$ / shares
Jul. 31, 2017
USD ($)
$ / shares
Mar. 31, 2017
USD ($)
$ / shares
Jun. 30, 2020
USD ($)
$ / shares
Jun. 30, 2019
USD ($)
May 31, 2017
USD ($)
$ / shares
shares
Dec. 31, 2017
USD ($)
$ / shares
shares
Mar. 31, 2020
USD ($)
Interest Payable, Current                             $ 654,760       $ 397,652
Amortization of Debt Discount (Premium)                             510,885 $ 200,382      
Interest Expense, Debt, Excluding Amortization                             $ 17,225      
Subsequent Event [Member] | Repayment of Iliad Note [Member] | Judicial Ruling [Member]                                      
Debt Instrument, Debt Default, Interest Rate Penalty 15.00%                                    
Litigation Settlement, Amount Awarded to Other Party $ 3,264,594                                    
Minimum [Member]                                      
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $ / shares                             $ 0.25        
Maximum [Member]                                      
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $ / shares                             $ 1        
Warrants Issued in March 2017 Convertible Note Offering [Member]                                      
Debt Instrument, Convertible, Number of Warrants                           4,000          
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $ / shares                           $ 0.60     $ 0.60    
Warrants and Rights Outstanding, Term (Year)                           3 years     3 years    
Class of Warrant or Right, Issued (in shares) | shares                                 8,000,000    
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right (in shares) | shares                                 1    
Warrants Related to July 2017 Convertible Note Offering [Member]                                      
Debt Instrument, Convertible, Number of Warrants                         4,000            
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $ / shares                         $ 0.65         $ 0.60  
Warrants and Rights Outstanding, Term (Year)                                   3 years  
Class of Warrant or Right, Issued (in shares) | shares                                   28,804,000  
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right (in shares) | shares                                   1  
Convertible Notes Payable [Member] | March 2017 Convertible Note Offering [Member]                                      
Debt Instrument, Face Amount Per Note                           $ 1,000          
Debt Instrument, Interest Rate, Stated Percentage                           6.00%          
Debt Instrument, Face Amount                                 $ 2,000,000    
Debt Instrument, Term (Year)                                 3 years    
Debt Instrument, Unamortized Discount, Total                                 $ 1,933,693    
Debt Instrument, Convertible, Beneficial Conversion Feature                                 904,690    
Debt Instrument, Convertible, Discount, Fair Value of Warrants                                 $ 1,029,003    
Convertible Notes Payable [Member] | March 2017 Convertible Note Offering [Member] | Common Stock [Member]                                      
Debt Instrument, Convertible, Number of Equity Instruments                           4,000     8,000,000    
Debt Instrument, Convertible, Conversion Price (in dollars per share) | $ / shares                           $ 0.25          
Convertible Notes Payable [Member] | July 2017 Convertible Note Offering [Member]                                      
Debt Instrument, Face Amount Per Note                         $ 1,000            
Debt Instrument, Face Amount                                   $ 7,201,000  
Debt Instrument, Term (Year)                         3 years         3 years  
Debt Instrument, Unamortized Discount, Total                             $ 58,812     $ 7,092,796  
Debt Instrument, Convertible, Beneficial Conversion Feature                                   3,142,605  
Debt Instrument, Convertible, Discount, Fair Value of Warrants                                   $ 3,950,191  
Long-term Debt, Gross                             1,198,188        
Interest Payable, Current                             228,052        
Amortization of Debt Discount (Premium)                             $ 96,527        
Convertible Notes Payable [Member] | July 2017 Convertible Note Offering [Member] | Common Stock [Member]                                      
Debt Instrument, Convertible, Number of Equity Instruments                         4,000         28,804,000  
Debt Instrument, Convertible, Conversion Price (in dollars per share) | $ / shares                         $ 0.25            
Convertible Notes Payable [Member] | The 8% Convertible Promissory Note Dated April 23, 2019 [Member]                                      
Debt Instrument, Interest Rate, Stated Percentage                     8.00%       15.00%        
Debt Instrument, Convertible, Conversion Price (in dollars per share) | $ / shares         $ 0.0375 $ 0.06         $ 0.17                
Debt Instrument, Face Amount                     $ 2,765,000       $ 3,041,500        
Debt Instrument, Unamortized Discount, Total                     265,000                
Long-term Debt, Gross                             3,041,500        
Amortization of Debt Discount (Premium)                             29,831        
Debt Conversion, Original Debt, Amount         $ 50,000 $ 75,000                         $ 125,000
Debt Conversion, Converted Instrument, Shares Issued (in shares) | shares         1,333,333 1,250,000                          
Short-term Debt, Total                             3,041,500        
Interest Expense, Debt, Total                             130,659        
Interest Expense, Debt, Excluding Amortization                             100,828        
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net, Total                     440,000                
Payments for Brokerage Fees                     $ 175,000                
Induced Conversion of Convertible Debt Expense           $ 64,706                          
Debt Instrument, Debt Default, Interest Rate Penalty   10.00%                                  
Debt Instrument, Debt Default, Interest Expense   $ 9,559                                  
Debt Instrument, Debt Default, Principal Expense   $ 276,500                                  
Debt Instrument, Debt Default, Increase in Principal Amount, Percent   10.00%                                  
Interest Payable                             192,649        
Interest Payable, Default Penalty                             9,559        
Promissory Note [Member]                                      
Debt Instrument, Face Amount                             6,574,808        
Short-term Debt, Total                             6,327,113        
Promissory Note [Member] | July 2017 Convertible Note Offering [Member]                                      
Debt Instrument, Interest Rate, Stated Percentage                         6.00%            
Senior Secured Convertible Promissory Note [Member] | The 8% Senior Secured Convertible Promissory Note Dated February 28, 2019 [Member]                                      
Debt Instrument, Interest Rate, Stated Percentage       8.00%         8.00% 8.00%   8.00%              
Debt Instrument, Face Amount                       $ 1,500,000              
Debt Instrument, Unamortized Discount, Total     $ 584,842         $ 9,579   $ 17,225         182,276        
Debt Instrument, Convertible, Beneficial Conversion Feature             $ 92,796   $ 133,806     $ 176,471              
Long-term Debt, Gross     687,021                       1,089,587        
Amortization of Debt Discount (Premium)     57,551                       227,206        
Debt Conversion, Original Debt, Amount     120,000         110,000   170,000                  
Debt Instrument, Increase (Decrease), Net, Total     (62,449) $ 30,000       (100,421) 100,000 (152,775)                  
Short-term Debt, Total     $ 1,271,863 1,361,863     1,269,067 $ 1,361,863 1,338,057 $ 1,330,000                  
Proceeds from Related Party Debt                 100,000                    
Debt Instrument, Increase, Accrued Interest                 41,863                    
Gain (Loss) on Extinguishment of Debt, Total       $ 0     $ (92,796)   $ (124,158)                    
Interest Expense, Debt, Total                             252,573        
Interest Expense, Debt, Excluding Amortization                             $ 25,367        
Senior Secured Convertible Promissory Note [Member] | The 8% Senior Secured Convertible Promissory Note Dated February 28, 2019 [Member] | Minimum [Member]                                      
Days to Cure Breach of Default After Notification From Lender                             5        
Senior Secured Convertible Promissory Note [Member] | The 8% Senior Secured Convertible Promissory Note Dated February 28, 2019 [Member] | Maximum [Member]                                      
Days to Cure Breach of Default After Notification From Lender                             10        
Senior Secured Convertible Promissory Note [Member] | The 8% Senior Secured Convertible Promissory Note Dated February 28, 2019 [Member] | GB Sciences, Nevada, LLC [Member] | Collateral Pledged [Member]                                      
Noncontrolling Interest, Ownership Percentage by Parent                       100.00%              
Senior Secured Convertible Promissory Note [Member] | The 8% Senior Secured Convertible Promissory Note Dated February 28, 2019 [Member] | Common Stock [Member]                                      
Debt Instrument, Convertible, Number of Equity Instruments                       8,823,529              
Debt Instrument, Convertible, Conversion Price (in dollars per share) | $ / shares     $ 0.04 $ 0.04     $ 0.08 $ 0.11 $ 0.11 $ 0.17   $ 0.17              
Debt Conversion, Converted Instrument, Shares Issued (in shares) | shares     3,000,000         1,000,000   1,000,000                  
XML 44 R33.htm IDEA: XBRL DOCUMENT v3.20.2
Note 7 - Capital Transactions (Details Textual) - USD ($)
3 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Dec. 31, 2019
Proceeds from Warrant Exercises $ 151,202  
Class of Warrant or Right, Outstanding (in shares) 79,547,077    
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance (in shares) 13,366,334    
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Ending Balance (in dollars per share) $ 0.28    
Minimum [Member]      
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) 0.25    
Maximum [Member]      
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) $ 1    
Warrants Issued to Investors in Private Placements [Member]      
Class of Warrant or Right, Exercises in Period (in shares) 4,991,084    
Proceeds from Warrant Exercises $ 136,081    
Brokerage Fees for Issuance of Common Stock and Warrants $ 15,121    
Warrants Issued to Investors in Private Placements [Member] | Minimum [Member]      
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share)     $ 0.03
Warrants Issued to Investors in Private Placements [Member] | Maximum [Member]      
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share)     $ 0.05
XML 45 R34.htm IDEA: XBRL DOCUMENT v3.20.2
Note 8 - Commitments and Contingencies (Details Textual)
3 Months Ended 33 Months Ended
Aug. 24, 2020
USD ($)
Aug. 04, 2020
USD ($)
Jul. 14, 2020
USD ($)
Apr. 22, 2020
USD ($)
Sep. 18, 2017
USD ($)
Jun. 30, 2020
USD ($)
Jun. 30, 2020
USD ($)
Mar. 31, 2020
USD ($)
Payment of Services Provided by Contractor [Member] | Pending Litigation [Member]                
Loss Contingency, Damages Sought, Value       $ 73,050        
Loss Contingency Accrual, Ending Balance               $ 73,050
Convertible Notes Payable [Member] | The 8% Convertible Promissory Note Dated April 23, 2019 [Member]                
Debt Instrument, Debt Default, Interest Rate Penalty       10.00%        
Debt Instrument, Default, Expense       $ 286,059        
Long-term Debt, Total           $ 3,234,149 $ 3,234,149  
Interest Payable           $ 192,649 192,649  
Subsequent Event [Member] | Repayment of Iliad Note [Member] | Judicial Ruling [Member]                
Debt Instrument, Debt Default, Interest Rate Penalty     15.00%          
Litigation Settlement, Amount Awarded to Other Party     $ 3,264,594          
Agreement With Louisiana State University AgCenter [Member]                
Term of Agreement (Year)         5 years 3 years    
Option to Renew Agreement, Amount         2      
Term of Agreement, Renewal (Year)         5 years      
Research and Development Expense, Total         $ 500,000 $ 250,000 $ 750,000  
Agreement With Louisiana State University AgCenter [Member] | Subsequent Event [Member]                
Annual Research Contributions $ 250,000 $ 250,000            
XML 46 R35.htm IDEA: XBRL DOCUMENT v3.20.2
Note 9 - Related Party Transactions (Details Textual) - USD ($)
Jun. 30, 2020
Mar. 31, 2020
Notes Payable, Related Parties, Current $ 151,923 $ 151,923
John Davis [Member]    
Notes Payable, Related Parties, Current 151,923  
Officers and Directors [Member]    
Due to Related Parties, Total 712,176  
Unpaid Bonuses, Related Parties 84,497  
Reimbursement for Business Expense, Related Parties 70,959  
Officer [Member]    
Unpaid Wages, Related Parties 447,633  
Director [Member]    
Unpaid Wages, Related Parties $ 109,087  
XML 47 R36.htm IDEA: XBRL DOCUMENT v3.20.2
Note 10 - Sale of 50% Membership Interest in GB Sciences Louisiana, LLC (Details Textual) - USD ($)
2 Months Ended 12 Months Ended 29 Months Ended
Aug. 24, 2020
Aug. 04, 2020
Nov. 15, 2019
Feb. 12, 2018
Oct. 15, 2020
Mar. 31, 2020
Jun. 30, 2020
Aug. 23, 2020
Subsequent Event [Member] | John Davis [Member]                
Due to Related Parties, Total   $ 189,423            
Subsequent Event [Member] | Agreement With Louisiana State University AgCenter [Member]                
Annual Research Contributions $ 250,000 $ 250,000            
GB Sciences Louisiana, LLC [Member]                
Proceeds from Divestiture of Businesses     $ 8,000,000          
Earnout Payments     $ 8,000,000          
Financing Receivable, after Allowance for Credit Loss, Total           $ 5,224,423 $ 5,224,423  
Gain (Loss) on Modification of Note Receivable           $ (1,895,434)    
GB Sciences Louisiana, LLC [Member] | Subsequent Event [Member]                
Notes Receivable, Net, Scheduled Payments $ 500,000             $ 750,000
GB Sciences Louisiana, LLC [Member] | Forecast [Member]                
Proceeds from Collection of Notes Receivable and Liabilities Forgiveness         $ 5,224,423      
Debt Instrument, Decrease, Forgiveness         324,423      
Proceeds from Collection of Notes Receivable         4,900,000      
Note Receivable Satisfied         8,000,000      
Annual Research Contribution Commitment to LSU Assumed by Counter Party         $ 250,000      
Wellcana Group, LLC [Member]                
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners       49.99%        
Wellcana Group, LLC [Member] | GB Sciences Louisiana, LLC, Sale of Equity [Member]                
Sale of Stock, Percentage of Ownership     50.01% 15.00%        
Sale of Stock, Consideration Received on Transaction       $ 3,000,000     $ 7,000,000  
Sale of Stock, Percentage of Ownership Available For Sale       35.00%        
Sale of Stock, Percentage of Available Stock For Sale, Percent to be Sold Per Transaction       5.00%        
Sale of Stock, Consideration Received Per Transaction       $ 1,000,000        
XML 48 R37.htm IDEA: XBRL DOCUMENT v3.20.2
Note 11 - Sale of Membership Interests in Nevada Subsidiaries (Details Textual) - USD ($)
Mar. 24, 2020
Nov. 27, 2019
Jul. 24, 2020
Dec. 06, 2019
Teco [Member]        
Sale of Stock, Percentage of Ownership 100.00%      
Proceeds from Divestiture of Businesses $ 4,000,000      
Financing Receivable, after Allowance for Credit Loss, Total $ 4,000,000      
Notes Receivable, Interest Rate 8.00%      
Notes Receivable, Term of Monthly Installments (Month) 3 years      
Line of Credit [Member]        
Line of Credit Facility, Maximum Borrowing Capacity   $ 470,000    
Teco Note [Member] | Line of Credit [Member]        
Line of Credit Facility, Maximum Borrowing Capacity       $ 470,000
The July 24 Note [Member] | Subsequent Event [Member]        
Debt Instrument, Interest Rate, Stated Percentage     8.00%  
The July 24 Note [Member] | Secured Debt [Member] | Subsequent Event [Member] | AJE Management, LLC [Member]        
Line of Credit Facility, Maximum Borrowing Capacity     $ 500,000  
Debt Instrument, Interest Rate, Stated Percentage     8.00%  
Teco [Member]        
Sale of Stock, Percentage of Ownership   75.00%    
Sale of Stock, Consideration Received on Transaction   $ 3,000,000    
Sale of Stock, Additional Earn-out Payments   $ 3,000,000    
GB Sciences Nopah, LLC [Member]        
Sale of Stock, Percentage of Ownership   100.00%    
Sale of Stock, Consideration Received on Transaction   $ 300,000    
XML 49 R38.htm IDEA: XBRL DOCUMENT v3.20.2
Note 12 - Subsequent Events (Details Textual) - USD ($)
2 Months Ended
Aug. 24, 2020
Aug. 04, 2020
Jul. 14, 2020
Apr. 22, 2020
Oct. 15, 2020
Aug. 31, 2020
Aug. 23, 2020
Jul. 24, 2020
Jun. 30, 2020
Apr. 23, 2019
GB Sciences Louisiana, LLC [Member] | Forecast [Member]                    
Proceeds from Collection of Notes Receivable and Liabilities Forgiveness         $ 5,224,423          
Debt Instrument, Decrease, Forgiveness         324,423          
Proceeds from Collection of Notes Receivable         4,900,000          
Note Receivable Satisfied         8,000,000          
Annual Research Contribution Commitment to LSU Assumed by Counter Party         $ 250,000          
Subsequent Event [Member] | Repayment of Iliad Note [Member] | Judicial Ruling [Member]                    
Debt Instrument, Debt Default, Interest Rate Penalty     15.00%              
Litigation Settlement, Amount Awarded to Other Party     $ 3,264,594              
Subsequent Event [Member] | GB Sciences Louisiana, LLC [Member]                    
Notes Receivable, Net, Scheduled Payments $ 500,000           $ 750,000      
Note Receivable, Payments in Forbearance           $ 500,000        
Subsequent Event [Member] | John Davis [Member]                    
Due to Related Parties, Total   $ 189,423                
Subsequent Event [Member] | Agreement With Louisiana State University AgCenter [Member]                    
Annual Research Contributions $ 250,000 $ 250,000                
The July 24 Note [Member] | Subsequent Event [Member]                    
Debt Instrument, Interest Rate, Stated Percentage               8.00%    
July 24 Note [Member] | Subsequent Event [Member] | Revolving Credit Facility [Member]                    
Line of Credit Facility, Maximum Borrowing Capacity               $ 500,000    
The 8% Convertible Promissory Note Dated April 23, 2019 [Member] | Convertible Notes Payable [Member]                    
Debt Instrument, Interest Rate, Stated Percentage                 15.00% 8.00%
Debt Instrument, Debt Default, Interest Rate Penalty       10.00%            
Debt Instrument, Default, Expense       $ 286,059            
Long-term Debt, Total                 $ 3,234,149  
Interest Payable                 $ 192,649  
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