10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2018

[  ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

COMMISSION FILE NUMBER: 333-208293

CANBIOLA. INC.

(Exact name of Registrant as specified in its charter)

Florida	20-3624118
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

960 South Broadway, Suite 120

Hicksville NY 11801

 (Address of principal executive offices)

(516) 590-1846

(Registrant’s telephone number, including area code)

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

Indicate by check mark whether the 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 [X]  No [  ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X]  No [  ]

 Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See 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	[X]
(Do not check if smaller reporting company)		Emerging Growth Company	[X]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

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

The number of shares of the registrant’s only class of common stock issued and outstanding as of August 17, 2018 was 247,813,201 shares.

1

CANBIOLA, INC.

FORM 10-Q

June 30, 2018

TABLE OF CONTENTS

		Page No.
PART I. - FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Balance Sheets June 30, 2018 and December 31, 2017	3
	Consolidated Statements of Operations – Three and Six Months Ended June 30, 2018 and 2017	4
	Consolidated Statements of Cash Flows – Six Months Ended June 30, 2018  and 2017	6
	Condensed Notes to Unaudited Consolidated Financial Statements.	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	23
Item 3	Quantitative and Qualitative Disclosures About Market Risk.	24
Item 4	Controls and Procedures.	25
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	26
Item 1A.	Risk Factors	26
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26
Item 3.	Defaults Upon Senior Securities	27
Item 4.	Mine Safety Disclosures	27
Item 5.	Other Information	27
Item 6.	Exhibits	27

2

PART 1 - FINANCIAL INFORMATION

Item 1.

Financial Statements.

Canbiola, Inc. and Subsidiary
Consolidated Balance Sheets
	June 30,	December 31,
	2018		2017
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$ 73,572		$ 1,652
Accounts receivable, less allowance for doubtful       accounts of $0 and $0, respectively	14,132		6,075
Inventory	7,122		9,834
Note receivable – current	75,000		75,000
Prepaid expenses – current	657,042		64,911
Total current assets	826,868		157,472
Property and equipment, at cost less accumulated depreciation of $21,852 and $20,248, respectively	47,899		11,148
Other assets:
Security Deposit	11,687		11,687
Prepaid expenses – noncurrent	467,220
Note receivable – noncurrent	39,000		39,000
Total other assets	517,907		50,687
Total assets	$ 1,392,674		$ 219,307
Liabilities and Stockholders' Deficiency
Current liabilities:
Notes and loans payable	$ 261,669		$ 193,504
Derivative Liability	727,086		1,451,137
Accounts payable	132,368		143,274
Accrued officers compensation	171,250		98,750
Other accrued expenses payable	68,901		62,539
Total current liabilities and total liabilities	1,361,274		1,949,204
Commitments and contingencies (Notes 12 and 13)
Stockholders' deficiency:
Preferred stock, authorized 5,000,000 shares:  Series A Preferred stock, no par value: authorized 20 shares, issued and outstanding 13 and 8 shares, respectively	1,786,537		243,537
Series B Preferred stock, $0.001 par value: authorized 500,000 shares, issued and outstanding 365,089 and 157,985 shares, respectively	344		150
Common stock, no par value; authorized 750,000,000 shares, issued and outstanding 247,017,230 and 225,572,323shares, respectively	13,028,907		12,524,042
Additional Paid-in capital	346,406		149,850
Additional Paid-in capital – Stock Options (Note 10)	84,000		-
Accumulated deficit	(15,214,794)		(14,647,476)
Total stockholders' deficiency	31,400		(1,729,897)
Total liabilities and stockholders' deficiency	$ 1,392,674		$ 219,307

See notes to consolidated financial statements

3

Canbiola, Inc. and Subsidiary
Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
	Six Months Ended June 30,			Three Months Ended June 30,
		2018	2017		2018	2017
Revenues
Service Revenue		$ 12,757	$ 41,707		$ 5,957	$ 23,735
Product Sales		211,203	2,135		148,234	2,135
Total Revenues		223,960	43,842		154,191	25,870
Cost of product sales		91,439	1,139		46,852	1,139
Gross profit		132,521	42,703		107,339	24,731
Operating expenses:
Officers compensation		136,250	38,832		76,250	19,377
Consulting fees (including stock-based compensation of $572,777, $37,229, $344,869 and $26,229, respectively)		643,676	71,782		367,769	55,082
Directors fees (including stock-based compensation of $185,400,$0, $0 and $0, respectively)		185,400	-		(17,400)	-
Advertising expense		37,008	21,510		14,675	20,893
Hosting expense		7,478	14,687		3,810	12,246
Rent expense		33,065	32,530		16,800	16,265
Professional fees		70,339	62,736		56,956	46,758
Depreciation of property and equipment		1,604	1,614		801	807
Amortization of intangible assets		-	1,986		-	993
Other		120,827	60,519		56,113	38,775
Total operating expenses		1,235,647	306,196		575,774	211,196
Loss from operations		(1,103,126)	(263,493)		(468,435)	(186,465)

4

Other income (expense):
Interest income	5,024	586	2,512	293
Income (expense) from derivative liability	844,051	(53,655)	(231,655)	(250,334)
Loss on stock issuance	(185,104)	-	(185,104)	-
Loss on debt conversion	(57,738)	-	(57,738)	-
Interest expense (including amortization of debt discounts of $54,165,       $153,105, $25,701 and $65,375, respectively)	(70,425)	(167,786)	(34,456)	(71,942)
Other income (expense) – net	535,808	(220,855)	(506,441)	(321,983)
Loss before provision for income taxes	(567,318)	(484,348)	(974,876)	(508,448)
Provision for income taxes	-	-	-	-
Net loss and comprehensive loss	$ (567,318)	$ (484,348)	$ (974,876)	$ (508,448)
Net loss per common share – basic and diluted
Basic	$ (0.00)	$ (0.00)	$ (0.00)	$ (0.00)
Diluted	$ (0.00)	$ (0.00)	$ (0.00)	$ (0.00)
Weighted average common shares outstanding –
Basic	232,957,482	153,334,334	236,270,276	158,836,059
Diluted	371,751,524	267,980,990	377,833,277	278,278,009

See notes to consolidated financial statements.

5

Canbiola, Inc. and Subsidiary
Consolidated Statements of Cash Flows (Unaudited)
	Six Months Ended June 30,
	2018	2017
Operating Activities:
Net loss	$ (567,318)	$ (484,348)
Adjustments to reconcile net loss to net
cash used in operating activities:
Stock-based compensation, net of prepaid stock-               based consulting fees	758,177	37,229
Loss on stock issuance	185,104	-
Loss on debt conversion	57,738	-
Debt issuance expense	14,000	-
Expense from derivative liability	(844,051)	53,655
Depreciation of property and equipment	1,604	1,614
Amortization of intangible assets	-	1,986
Amortization of debt discounts	54,165	153,105
Changes in operating assets and liabilities:
Accounts receivable	(8,057)	(10,948)
Inventory	2,712	(10,946)
Prepaid expenses	-	2,500
Accounts payable	(10,906)	48,896
Accrued officers compensation	72,500	36,000
Other accrued expenses payable	10,607	17,321
Net cash used in operating activities	(273,725)	(153,936)
Investing Activities:
Fixed assets additions	(38,355)	-
Net cash used in investing activities	(38,355)	-
Financing Activities:
Proceeds received from notes and loans payable	135,000	124,000
Proceeds from sale of Series B preferred stock	249,000	-
Net cash provided by financing activities	384,000	124,000
Increase (decrease) in cash and cash equivalents	71,920	(29,936)
Cash and cash equivalents, beginning of period	1,652	30,193
Cash and cash equivalents, end of period	$ 73,572	$ 257
SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes paid	$ -	$ -
Interest paid	$ -	$ -
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Issuance of common stock in satisfaction of debt	$ 15,000	$ 65,000
Issuance of common stock in satisfaction of directors fees	$ 202,800	$ -
Issuance of common stock in satisfaction of accrued interest	$ 4,246	$ 7,837

See notes to consolidated financial statements.

6

Canbiola, Inc. and Subsidiary

Notes to Consolidated Financial Statements

Six Months Ended June 30, 2018 and 2017

(Unaudited)

NOTE 1 – Organization and Description of Business

Canbiola, Inc. was originally incorporated as WrapMail, Inc. (“WRAP”) in Florida on October 11, 2005.  Effective January 5, 2015, WRAP acquired 100% ownership of Prosperity Systems, Inc. (“Prosperity”), a New York corporation incorporated on April 2, 2008.  On May 15, 2017, WRAP changed its name to Canbiola, Inc. (the “Company” or “CANB” or “Canbiola”). The Company operates several divisions, including document management and email marketing platforms and a division specializing in the sale of products containing CBD. The Company used to operate its document and information platform from its wholly owned subsidiary, Prosperity Systems, Inc; however, after the acquisition of Prosperity, the Company transferred Prosperity’s operations to WRAP and is presently in the process of dissolving Prosperity. For the periods presented, the assets, liabilities, revenues, and expenses are those of CANB. Prosperity had no activity for the periods presented.

Effective December 27, 2010, WRAP effected a 10 for 1 forward stock split of its common stock. Effective June 4, 2013, WRAP effected a 1 for 10 reverse stock split of its common stock. The accompanying consolidated financial statements retroactively reflect these stock splits.

Canbiola, Inc. is a US Company specializing in the sale of a variety of Cannabidiol (CBD) based products derived from Hemp, such as oils, creams, moisturizers, chews, vapes, isolate, gel caps, concentrate and water. Canbiola is developing their own line of proprietary products as well as seeking synergistic value through acquisitions in the Hemp Industry. Canbiola aims to be the premier provider of the highest quality Hemp derived natural CBD products on the market through sourcing the very best raw material and developing a variety of products we believe will improve people's lives in a variety of areas.

CANB expects to concentrate its future business activities on the sale of CBD products and does not plan to market or further develop its technology products.

NOTE 2 – Going Concern Uncertainty

The consolidated financial statements have been prepared on a “going concern” basis, which contemplates the realization of assets and liquidation of liabilities in a normal course of business. As of June 30, 2018, the Company had cash and cash equivalents of $73,572 and a working capital deficit of $534,406. For the six months ended June 30, 2018 and 2017, the Company had net loss of $567,318 and $484,348, respectively. These factors raise substantial doubt as to the Company’s ability to continue as a going concern. The Company plans to improve its financial condition by raising capital through sales of shares of its common stock. Also, the Company plans to expand its operation of CBD products to increase its profitability. The consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

NOTE 3 – Summary of Significant Accounting Policies

(a)  Principles of Consolidation

The consolidated financial statements include the accounts of CANB and its wholly owned subsidiary Prosperity from the date of its acquisition on January 5, 2015. All intercompany balances and transactions have been eliminated in consolidation.

The Company considers Pure Health products to be a variable interest entity as prescribed under Accounting guidelines. Due to the fact that the company is not dependent on Pure Health Products solely for manufacture, no consolidation of Pure Heath Products financial information is required.

(b)  Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.  Actual results could differ from those estimates.

7

(c)  Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, notes receivable, notes and loans payable, accounts payable, and accrued expenses payable. Except for the noncurrent note receivable, the fair value of these financial instruments approximate their carrying amounts reported in the balance sheets due to the short term maturity of these instruments. Based on comparable instruments with similar terms, the fair value of the noncurrent note receivable approximates its carrying value.

Pursuant to ASC 820, Fair Value Measurements and Disclosures, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1 - applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2 - applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3 - applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

(d)  Cash and Cash Equivalents

The Company considers all liquid investments purchased with a maturity of three months or less to be cash equivalents.

(e)  Inventory

All inventories are finished goods, and stated at the lower of cost or net realizable value. Cost is principally determined using the first-in, first-out (FIFO) method.

(f)  Property and Equipment, Net

Property and equipment, net, is stated at cost less accumulated depreciation.  Depreciation is calculated using the straight-line method over the estimated useful lives of the respective assets.  Maintenance and repairs are charged to operations as incurred.

(g)  Intangible Assets, Net

Intangible assets, net, are stated at cost less accumulated amortization.  Amortization is calculated using the straight-line method over the estimated economic lives of the respective assets.

(h)  Goodwill and Intangible Assets with Indefinite Lives

The Company does not amortize goodwill and intangible assets with indefinite useful lives, but instead tests for impairment at least annually.  When conducting the annual impairment test for goodwill, the Company compares the estimated fair value of a reporting unit containing goodwill to its carrying value.  If the estimated fair value of the reporting unit is determined to be less than its carrying value, goodwill is reduced, and an impairment loss is recorded.

 (i)  Long-lived Assets

The Company reviews long-lived assets held and used, intangible assets with finite useful lives and assets held for sale for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  If an evaluation of recoverability is required, the estimated undiscounted future cash flows associated with the asset is compared to the asset’s carrying amount to determine if a write-down is required.  If the undiscounted cash flows are less than the carrying amount, an impairment loss is recorded to the extent that the carrying amount exceeds the fair value.

8

(j)  Revenue Recognition

The Company recognizes service revenue over agreed periods of services delivered to customers and recognizes product sales upon shipment of the ordered products to customers, provided there are no uncertainties regarding customer acceptance, persuasive evidence of an arrangement exists; the sales price is fixed or determinable; and collectability is deemed probable.

(k) Stock-Based Compensation

Stock-based compensation is accounted for at fair value in accordance with Accounting Standards Codification (“ASC”) Topic 718, “Compensation – Stock Compensation” (“ASC718”) and ASC 505-50, “Equity – Based Payments to Non-Employees.”

In addition to requiring supplemental disclosures, ASC 718 addresses the accounting for share-based payment transactions in which a company receives goods or services in exchange for (a) equity instruments of the company or (b) liabilities that are based on the fair value of the company’s equity instruments or that may be settled by the issuance of such equity instruments.  ASC 718 focuses primarily on accounting for transactions in which a company obtains employee services in share-based payment transactions.

In accordance with ASC 505-50, the Company determines the fair value of the stock based payment as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of either (1) the date at which a commitment for performance by the counterparty to earn the equity instrument is reached, or (2) the date at which the counterparty’s performance is complete.

Options and warrants

The fair value of stock options and warrants is estimated on the measurement date using the Black-Scholes model with the following assumptions, which are determined at the beginning of each year and utilized in all calculations for that year:

Risk-Free Interest Rate.

We utilized the U.S. Treasury yield curve in effect at the time of grant with a term consistent with the expected term of our awards.  

Expected Volatility.

We calculate the expected volatility based on a volatility index of peer companies as we did not have sufficient historical market information to estimate the volatility of our own stock.

Dividend Yield.

We have not declared a dividend on its common stock since its inception and have no intentions of declaring a dividend in the foreseeable future and therefore used a dividend yield of zero.

Expected Term.

The expected term of options granted represents the period of time that options are expected to be outstanding.  We estimated the expected term of stock options by using the simplified method.  For warrants, the expected term represents the actual term of the warrant.

Forfeitures.

Estimates of option forfeitures are based on our experience. We will adjust our estimate of forfeitures over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of compensation expense to be recognized in future periods.

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(l)  Advertising

Advertising costs are expensed as incurred and amounted to $37,008 and $21,510 for the six months ended June 30, 2018 and 2017, respectively.

(m) Research and Development

Research and development costs are expensed as incurred.

(n)  Income Taxes

Income taxes are accounted for under the assets and liability method.  Current income taxes are provided in accordance with the laws of the respective taxing authorities.  Deferred income taxes are provided for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.  Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is not more likely than not that some portion or all of the deferred tax assets will be realized.

The Company has adopted the provisions required by the Income Taxes topic of the FASB Accounting Standards Codification. The Codification Topic requires the recognition of potential liabilities as a result of management’s acceptance of potentially uncertain positions for income tax treatment on a “more-likely-than-not” probability of an assessment upon examination by a respective taxing authority. The Company believes that it has not taken any uncertain tax positions and thus has not recorded any liability.

(o)  Net Income (Loss) per Common Share

Basic net income (loss) per common share is computed on the basis of the weighted average number of common shares outstanding during the period.

Diluted net income (loss) per common share is computed on the basis of the weighted average number of common shares and dilutive securities (such as stock options and convertible securities) outstanding.  Dilutive securities having an anti-dilutive effect on diluted net income (loss) per share are excluded from the calculation. For the periods presented, the diluted net loss per share calculation excluded the effect of Series B preferred stocks and stock options outstanding (see Notes 7, 8 and 10).

(p)  Recent Accounting Pronouncements

In May 2014, the FASB issued ASU 2014-09 "Revenue from Contracts with Customers" (Topic 606) which establishes revenue recognition standards. ASU 2014-19 is effective for annual reporting periods beginning after December 15, 2017. The update establishes management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern including related disclosures. The impact of ASU 2014-19 on the Company’s financial statements has not been significant.

In 2016, the FASB issued ASU 2016-2 (Topic 842) which establishes a new lease accounting model for lessees. Under the new guidance, lessees will be required to recognize right of use assets and liabilities for most leases having terms of 12 months or more. ASU 2016-2 is effective for fiscal years beginning after December 15, 2018. The impact on the Company's financial statements is not expected to be significant.

(q) Reclassifications

Certain amounts in the prior year consolidated financial statements have been reclassified to conform to the current year presentation. These reclassification adjustments had no effect on the Company's previously reported net income.

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NOTE 4 – Notes Receivable

Notes receivable consist of:
	June 30,  2018	December 31,  2017
Secured Promissory note dated October 17, 2017 due from Pure Health         Products, LLC (“PHP”), interest at 12% per annum, due October         17, 2018, secured by assets of PHP	$ 75,000		$ 75,000
Note receivable dated November 30, 2015 from Stock Market Manager, Inc, interest at 3% per annum due November 30, 2020	39,000		39,000
Total	114,000		114,000
Current portion of notes receivable	(75,000)		(75,000)
Noncurrent portion of notes receivable	$ 39,000		$ 39,000

Pursuant to an option Agreement dated November 10, 2017, the Company has an option expiring November 10, 2027 to purchase certain specified assets of Pure Health for $75,000, payable via cancellation of Pure Health’s obligations under the Secured Promissory Note or in cash or cash equivalent.

Stock Market Manager, Inc is affiliated with Carl Dilley, a Company director.

NOTE 5 – Property and Equipment, Net

Property and Equipment, net, consist of:

	June 30,	December 31,
	2018	2017
Furniture & Fixtures	$ 19,018	$ 19,018
Office Equipment	12,378	12,378
Manufacturing Equipment	38,355	-
Total	69,751	31,396
Accumulated amortization	(21,852)	(20,248)
Net	$ 47,899	$ 11,148

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NOTE 6 – Intangible Assets, Net

Intangible assets, net, consist of:

	June 30,	December 31,
	2018	2017
Video conferencing software acquired by Prosperity in December 2009	$ 30,000	$ 30,000
Enterprise and audit software acquired by Prosperity in April 2008	20,000	20,000
Patent costs incurred by WRAP	6,880	6,880
Other	3,548	3,548
Total	60,428	60,428
Accumulated amortization and Impairment	(60,428)	(60,428)
Net	$ 0	$ 0

The above intangible assets relate to the document management and email marketing divisions. At December 31, 2017, we do not expect any future positive cash flow from these divisions. Accordingly, we have recorded an impairment expense of $21,509 at December 31, 2017 and reduced the net carrying value of these intangible assets to $0.

12

NOTE 7 – Notes and Loans Payable

Notes and loans payable consist of:
	June 30,  2018	December 31,  2017
Convertible notes payable to lender dated from March 15, 2016 (as amended June 2, 2016) to November 15, 2017, interest at rates ranging from 12% to 14.99% per annum, due from April 6, 2017 to May 15, 2018, partially converted at March 22, 2017 and the remaining notes convertible into Common Stock at a Conversion Price equal to the lesser of (i) $0.01 per share or (ii) 50% of the lowest Closing Bid Price of the Common Stock for the 30 Trading Days preceding the Conversion Date – net of         unamortized debt discount of $0 and $1,815, respectively	38,500		36,685
Convertible notes payable to lender dated February 1, 2016 (as amended December 21, 2016) and December 21, 2016, interest at 12% per annum, due February 1, 2017 and May 20, 2017, convertible into Common Stock at a Conversion Price equal to the lesser of (i) $0.01 per share or (ii) 50% of the lowest Closing Bid Price of the Common Stock for the 30 Trading Days preceding the Conversion Date – net of unamortized debt discount of $0 and $0, respectively. The note date dated February 1, 2016 was fully converted at June 11, 2018	50,000		65,000
Convertible notes payable to Pasquale and Rosemary Ferro dated from May 2, 2017 to May 4, 2018, interest at 12% per annum, due from September 16, 2017 to May 7, 2019 (as amended May 4, 2018), convertible into Common Stock at a Conversion Price equal to the lesser of (i) $0.01 per share or (ii) 50% of the lowest Closing Bid Price of the Common Stock for the 30 Trading Days preceding the Conversion Date – net of unamortized debt discount of $8,451 and $19,613, respectively	105,049		73,887
Convertible note payable to lender dated August 8, 2017 interest at 12% per annum, due August 8, 2018, convertible into Common Stock at a Conversion Price equal to the lesser of (i) $0.01 per share or (ii) 50% of the lowest Closing Bid Price of the Common Stock for the 30 Trading Days preceding the Conversion Date – net of unamortized debt discount of $2,671 and $15,068, respectively	22,329		9,932
Convertible note payable to lender dated June 6, 2018, interest at 12% per annum, due March 6, 2019, convertible into Common Stock at a Conversion Price equal to the lesser of 55% of the lowest Closing Bid Price of the Common Stock for the 25 Trading Days preceding the (i) Inception date or (ii) the Conversion Date – net of unamortized debt discount of $91,209 and $0, respectively	22,791		-
Note payable to brother of Marco Alfonsi, Chief Executive Officer of the Company, interest at 10% per annum, due August 22, 2016 (now past due)	5,000		5,000
Note payable to Carl Dilley, a director of the Company, interest at 12.99% per annum, due February 1, 2021	15,000		-
Loan payable to Mckenzie Webster Limited (“MWL”), an entity controlled by the former Chairman of the Board of Directors of the Company, non-interest bearing, due on demand	3,000		3,000
Total	$ 261,669		$ 193,504

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The derivative liability of the convertible notes payable consists of:

	June 30, 2018				December 31, 2017
	Face Value		Derivative Liability		Face Value		Derivative Liability
Convertible notes payable to lender dated from March 15, 2016 (as amended June 2, 2016) to November 15, 2017, due from April 6, 2017 to May 15, 2018		38,500		$ 74,119		38,500		248,597
Convertible notes payable to lender dated February 1, 2016 (as amended December 21, 2016) and December 21, 2016, due February 1, 2017 and May 20, 2017. The note date dated February 1, 2016 was fully converted at June 11, 2018		50,000		96,258		65,000		418,889
Convertible notes payable to Pasquale and Rosemary Ferro dated from May 2, 2017 to January 8, 2018, due from September 16, 2017 to May 7, 2019 (as amended May 4, 2018)		113,500		258,669		93,500		611,886
Convertible notes payable to lender dated June 6, 2018, due March 6, 2019		114,000		248,184		-		-
Convertible notes payable to lender dated August 8, 2017, due August 8, 2018		25,000		49,856		25,000		171,765
Totals		$ 341,000		$ 727,086		$ 222,000		$ 1,451,137

The above convertible notes contain a variable conversion feature based on the future trading price of the Company common stock. Therefore, the number of shares of common stock issuable upon conversion of the notes is indeterminate. Accordingly, we have recorded the fair value of the embedded conversion features as a derivative liability at the respective issuance dates (or amendment dates) of the notes ($460,316 total for the six months ended June 30, 2018) and charged the applicable amounts to debt discounts ($120,000 total for the six months ended June 30, 2018) and the remainder to other expense ($340,316 total for the six months ended June 30, 2018). The increase (decrease) in the fair value of the derivative liability from the respective issuance dates (or amendment dates) of the notes to the measurement date ($1,160,391 total decrease for the six months ended June 30, 2018) is charged (credited) to other expense (income). The fair value of the derivative liability of the notes is measured at the respective issuance dates and quarterly thereafter using the Black Scholes option pricing model. Assumptions used for the calculations of the derivative liability of the notes at June 30, 2018 include (1) stock price of $0.0215 per share, (2) exercise price of $0.0074 per share, (3) terms ranging from 0 days to 311 days, (4) expected volatility of 269% and (5) risk free interest rates ranging from 0.00% to 2.24%.

NOTE 8 – Preferred Stock

Each share of Series A Preferred Stock is convertible into 10,000,000 shares of CANB common stock and is entitled to 20,000,000 votes.

Each share of Series B Preferred Stock has the first preference to dividends, distributions and payments upon liquidation, dissolution and winding-up of the Company, and is entitled to an accrued cumulative but not compounding dividend at the rate of 5% per annum whether or not declared. After six months of the issuance date, such share and any accrued but unpaid dividends can be converted into common stock at the conversion price which is the lower of (i) $0.0101; or (ii) the lower of the dollar volume weighted average price of CANB common stock on the trading day prior to the conversion day or the dollar volume weighted average price of CANB common stock on the conversion day. The share of Series B Preferred Stock has no voting rights.

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The Company issued a total of 10 shares of CANB Series A Preferred Stock (5 shares to Mckenzie Webster Limited and 5 shares to Marco Alfonsi) in exchange for the retirement of a total of 100,000,000 shares of CANB common stock (50,000,000 shares from Mckenzie Webster Limited and 50,000,000 shares from Marco Alfonsi).

On October 4, 2017, the Company issued 3 shares of CANB Series A Preferred Stock to Alfonsi: 2 shares were the consideration for Alfonsi’s cancellation of accrued salaries payable of $127,803 owed to Alfonsi and 1 share (valued at $63,902) was issued pursuant to the new employment agreement with Alfonsi.

On November 30, 2017, MWL converted its 5 shares of CANB Series A Preferred Stock to 50,000,000 shares of CANB common stock.

On December 5, 2017, the Company issued 157,985 shares of CANB Series B Preferred Stock to RedDiamond Partners LLC (“RedDiamond”) pursuant to a Securities Purchase Agreement (the “SPA”) dated October 13, 2017, in exchange for proceeds of $150,000, or $0.95 per CANB Series B Preferred share.

On January 22, 2018, the Company issued 87,368 shares of CANB Series B Preferred Stock to RedDiamond pursuant to an amended Securities Purchase Agreement dated January 9, 2018, in exchange for proceeds of $83,000, or $0.95 per CANB Series B Preferred share.

On February 12, 2018, the Company issued 1 share of CANB Series A Preferred Stock to David Posel pursuant to a service agreement. The fair value of the issuance is $373,000 and will be amortized over the vesting period of four years.

On February 16, 2018, the Company issued 3 shares of CANB Series A Preferred Stock to David Posel pursuant to a service agreement. The fair value of the issuance is $1,020,000 and will be amortized over the vesting period of one year.

On February 16, 2018, the Company issued 87,368 shares of CANB Series B Preferred Stock to RedDiamond  pursuant to an amended Securities Purchase Agreement dated January 9, 2018, in exchange for proceeds of $83,000, or $0.95 per CANB Series B Preferred share.

On March 20, 2018, the Company issued 87,368 shares of CANB Series B Preferred Stock to RedDiamond pursuant to an amended Securities Purchase Agreement dated January 9, 2018, in exchange for proceeds of $83,000, or $0.95 per CANB Series B Preferred share.

On April 13, 2018, April 25, 2018, May 3, 2018, June 19, 2018 and June 25, 2018, RedDiamond converted its 10,000 shares, 10,000 shares, 10,000 shares, 15,000 shares and 10,000 shares of CANB Series B Preferred Stock to 1,287,129 shares, 1,287,129 shares, 1,287,129 shares, 3,545,455 shares, and 2,363,636 shares of CANB common stock, respectively.

On May 14, 2018, the Company issued 1 share of CANB Series A Preferred Stock to a consultant pursuant to a Consulting Agreement dated May 11, 2018. The $150,000 fair value of the issuance was partially charged to consulting fees in the three months ended June 30, 2018.

NOTE 9 – Common Stock

On February 2, 2017, the Company issued 200,000 shares of CANB common stock to a financial consultant for services rendered. The $11,000 fair value of the 200,000 shares of CANB common stock was charged to consulting fees in the three months ended March 31, 2017.

On February 13, 2017, the Company issued 1,685,900 shares of CANB common stock to the brother of the Chief Executive Officer of the Company in satisfaction of notes payable of $15,000 and accrued interest payable of $1,859.

On March 22, 2017, the Company issued 6,785,316 shares of CANB common stock to a lender in satisfaction of notes payable of $50,000 and accrued interest payable of $5,979.

On April 17, 2017, the Company issued 5,000,000 shares of CANB common stock to a consultant for services rendered. The $125,000 fair value of the 5,000,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2017.

On June 21, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,975 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2017.

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On June 28, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,000 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2017.

On August 25, 2017, the Company issued 7,142,857 shares of CANB common stock to a lender in satisfaction of notes payable of $50,000 and accrued interest payable of $3,331.

On August 25, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $3,750 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended September 30, 2017.

On September 5, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $4,375 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended September 30, 2017.

On September 7, 2017, the Company issued 2,500,000 shares of CANB common stock to a consultant for services rendered. The $32,750 fair value of the 2,500,000 shares of CANB common stock was charged to consulting fees in the three months ended September 30, 2017.

On September 11, 2017, the Company issued 250,000 and 250,000 shares of CANB common stock to two consultants for services rendered, respectively. The $3,350 fair value of each 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended September 30, 2017.

On September 25, 2017, the Company issued 2,500,000 shares of CANB common stock to a consultant for services rendered. The $2,525 fair value of the 2,500,000 shares of CANB common stock was partially charged to consulting fees in the three months ended September 30, 2017.

On November 2, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $1,725 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended December 31, 2017.

On November 9, 2017, the Company issued 2,500,000 shares of CANB common stock to a consultant for services rendered. The $21,250 fair value of the 2,500,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On November 30, 2017, the Company issued 50,000,000 shares of CANB common stock to Mckenzie Webster Limited in exchange for the retirement of 5 shares of CANB Series A Preferred Stock.

On December 5, 2017, the Company issued 250,000 and 250,000 shares of CANB common stock to two consultants for services rendered, respectively. The $3,000 fair value of each 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On December 7, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $4,500 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On December 18, 2017, the Company issued 500,000 shares of CANB common stock to a consultant for services rendered. The $9,050 fair value of the 500,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On December 25, 2017, the Company issued 250,000 and 250,000 shares of CANB common stock to two consultants for services rendered, respectively. The $7,250 fair value of each 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On February 7, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $9,825 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

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On February 9, 2018, the Company issued 3,000,000 and 3,000,000 shares of CANB common stock to its two directors for services rendered, respectively. The $101,400 fair value of each 3,000,000 shares of CANB common stock was charged to directors fees in the three months ended March 31, 2018.

On February 13, 2018, the Company issued 150,000 shares of CANB common stock to a consultant for services rendered. The $5,085 fair value of the 150,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 14, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $8,500 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 19, 2018, the Company issued 150,000 shares of CANB common stock to a consultant for services rendered. The $5,280 fair value of the 150,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 26, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $11,375 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On March 1, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $10,900 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended March 31, 2018.

On March 20, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $6,500 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended March 31, 2018.

On April 13, 2018, April 25, 2018, May 3, 2018, June 19, 2018 and June 25, 2018, the Company issued 1,287,129 shares, 1,287,129 shares, 1,287,129 shares, 3,545,455 shares, and 2,363,636 shares of CANB common stock to RedDiamond in exchange for the retirement of 10,000 shares, 10,000 shares, 10,000 shares, 15,000 shares and 10,000 shares of CANB Series B Preferred Stock, respectively.

On May 9, 2018, the Company issued 125,000 shares of CANB common stock to a consultant for services rendered.. The $1,812 fair value of the 125,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On May 29, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,000 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On May 31, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $4,600 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2018.

On June 4, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,750 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On June 11, 2018, the Company agreed to issue 2,749,429 shares of CANB common stock to a lender in satisfaction of notes payable of $15,000 and accrued interest payable of $4,246.

On June 18, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $6,250 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On June 22, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $8,250 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2018.

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NOTE 10 – Stock Options and Warrants

A summary of stock options and warrants activity follows:

	Shares of Common Stock Exercisable Into
	Stock
	Options	Warrants	Total
Balance, December 31, 2016	50,000	247,500	297,500
Granted in 2017	-	-	-
Expired in 2017	-	-	-
Balance, December 31, 2017	50,000	247,500	297,500
Granted in 1Q, 2Q 2018	3,000,000	-	3,000,000
Cancelled in 1Q, 2Q 2018	-	-	-
Balance, June 30, 2018	3,050,000	247,500	3,297,500

Issued and outstanding stock options as of June 30, 2018 consist of:

Year	Number Outstanding	Exercise	Year of
Granted	And Exercisable	Price	Expiration
2009	50,000	$ 1.000	2019
2018	3,000,000	$ 0.001	2023
Total	3,050,000

On June 11, 2018, the Company granted 3,000,000 options of CANB common stock to Carl Dilley, a director of the Company, in exchange for the retirement of a total of 3,000,000 shares of CANB common stock from Carl Dilley. The options are exercisable for the purchase of one share of the Registrant’s Common Stock at an exercise price of $0.001 per share. The Options are fully vested and are exercisable as of the Grant Date and all shall expire June 11, 2023. The value of the Stock Options ($84,000) were calculated using the Black Scholes option pricing model and the following assumptions: (i) $0.028 share price, (ii) 5 years term, (iii) 262.00% expected volatility, (iv) 2.80% risk free interest rate and the difference between this value and the fair value of retied shares was expensed in the quarterly period ended June 30, 2018.

Issued and outstanding warrants as of June 30, 2018 consist of:

Year	Number Outstanding	Exercise	Year of
Granted	And Exercisable	Price	Expiration
2010	247,500	$ 1.00	2020
Total	247,500

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NOTE 11 – Income Taxes

No provisions for income taxes were recorded for the periods presented since the Company incurred net losses in those periods.

The provisions for (benefits from) income taxes differ from the amounts determined by applying the U.S. Federal income tax rate of 21% and 35% to pretax income (loss) as follows:

	Six Months June 30,
	2018	2017
Expected income tax (benefit) at 21% and 35%	$ (122,791)	$ 8,435
Loss on stock issuance	38,872	-
Loss on debt conversion	12,125	-
Non-deductible stock-based compensation	162,871	3,850
Non-deductible amortization of debt discounts	11,375	30,706
Non-deductible expense from derivative liability	(177,251)	(68,838)
Increase in deferred income tax assets  valuation allowance	74,799	25,847
Provision for (benefit from) income taxes	$ -	$ -

Deferred income tax assets consist of:

	June 30,	December 31,
	2018	2017
Net operating loss carryforward	1,469,157	1,394,358
Valuation allowance	(1,469,157)	(1,394,358)
Net	$ -	$ -

Based on management's present assessment, the Company has not yet determined it to be more likely than not that a deferred income tax asset of $1,469,176 attributable to the future utilization of the $4,329,487 net operating loss carryforward as of June 30, 2018 will be realized. Accordingly, the Company has maintained a 100% allowance against the deferred income tax asset in the financial statements at December 31, 2017. The Company will continue to review this valuation allowance and make adjustments as appropriate. The net operating loss carryforward expires in years 2025, 2026, 2027, 2028, 2029, 2030, 2031, 2032, 2033, 2034, 2035, 2036, 2037 and 2038 in the amount of $1,369, $518,390, $594,905, $686,775, $159,141, $151,874, $135,096, $166,911, $311,890, $25,511, $338,345, $386,297, $496,798 and $356,185 respectively.

Current tax laws limit the amount of loss available to be offset against future taxable income when a substantial change in ownership occurs.  Therefore, the amount available to offset future taxable income may be limited.

The Company’s U.S. Federal and state income tax returns prior to 2013 are closed and management continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings. The statute of limitations on the 2013 tax year returns expired in March 2017.

The Company recognizes interest and penalties associated with uncertain tax positions as part of the income tax provision and would include accrued interest and penalties with the related tax liability in the consolidated balance sheets. There were no interest or penalties paid during 2018 and 2017.

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NOTE 12 – Commitments and Contingencies

Employment Agreements

On October 3, 2017, the Company executed an Executive Employment Agreement with Marco Alfonsi (“Alfonsi”) for Alfonsi to serve as the Company's chief executive officer and interim chief financial officer and secretary for cash compensation of $10,000 per month. Pursuant to the agreement, the Company issued a share of CANB Series A Preferred Stock to Alfonsi on October 4, 2017 (see Note 8). Alfonsi may terminate his employment upon 30 days written notice to the Company. The Company may terminate Alfonsi's employment upon written notice to Alfonsi by a vote of the Board of Directors.

On February 12, 2018, the Company executed an Executive Service Agreement (“Agreement”) with David Posel. The Agreement provides that Mr. Posel services as the Company’s Chief Operating Officer for a term of 4 years. The Agreement also provides for compensation to Mr. Posel of $5,000 cash per month and the issuance of 1 share of Series A Preferred Stock at the inception of the Agreement. The Agreement can be terminated upon the resignation or death of Mr. Posel, and also can be terminated by the Company due to the failure or neglect of Mr. Posel to perform his duties, or due to the misconduct of Mr. Posel in connection with the performance. On February 12, 2018, 1 share of CANB Series A Preferred Stock were issued to Mr. Posel (see Note 8).

On February 16, 2018, the Company executed an Executive Service Agreement (“Agreement”) with Andrew W Holtmeyer. The Agreement provides that Mr. Holtmeyer services as the Company’s Executive Vice President Business for a term of 3 years. The Agreement also provides for compensation to Mr. Holtmeyer of $10,000 cash per month and the issuance of 3, 2 and 1 share of Series A Preferred Stock at the beginning of each year. The Agreement can be terminated upon the resignation or death of Mr. Holtmeyer, and also can be terminated by the Company due to the failure or neglect of Mr. Holtmeyer to perform his duties, or due to the misconduct of Mr. Holtmeyer in connection with the performance. On February 16, 2018, 3 shares of CANB Series A Preferred Stock were issued to Mr. Holtmeyer (see Note 8).

Consulting Agreements

On July 29, 2017, the Company executed a Consulting Agreement with Andrew W Holtmeyer for Mr. Holtmeyer to serve as the Company's consultant for monthly cash payment of $5,000 through July 29, 2018. Effective February 16, 2018, the Company terminated the agreement due to the replacement of an Executive Service Agreement.

On September 6, 2017, the Company executed a Consulting Agreement with T8 Partners LLC (“T8”) for T8 to serve as the Company's consultant for stock compensation of a total of 10,000,000 restricted shares. Pursuant to the agreement, the Company issued 2,500,000 restricted shares of CANB common stock to T8 on September 7, 2017. Effective October 27, 2017, the Company terminated the agreement due to non-performance by T8.

On November 9, 2017, the Company executed a Consulting Agreement with Healthcare Advisory Group Company (“Healthcare”) for Healthcare to serve as the Company's consultant for stock compensation of a total of 5,000,000 restricted shares. Pursuant to the agreement, the Company issued 2,500,000 restricted shares of CANB common stock to Healthcare on November 9, 2017. Effective March 6, 2018, the Company terminated the agreement due to non-performance by Healthcare.

Lease Agreements

On December 1, 2014, Prosperity entered into a lease agreement with KLAM, Inc. for office space in Hicksville, New York for an initial term of one year commencing December 1, 2014. The lease provides for monthly rentals of $2,500 and provides Prosperity an option to renew the lease after the initial term. The Company has continued to occupy this space after November 30, 2015 under a month to month arrangement at $2,500 per month. KLAM, Inc. is controlled by the wife of the Company's chief executive officer Marco Alfonsi.

On September 11, 2015, the Company executed a lease agreement with an unrelated third party for office space in Hicksville, New York for a term of 37 months. The lease provides for monthly rentals of $2,922 for lease year 1, $3,009 for lease year 2, and $3,100 for lease year 3. The lease also provides for additional rent based on increases in base year operating expenses and real estate taxes.

Rent expense for the six months ended June 30, 2018 and 2017 was $33,065 and $32,530, respectively.

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At June 30, 2018, the future minimum lease payments under non-cancellable operating leases were:

Year ended December 31, 2018

    9,300

Total

 $ 9,300

Major Customers

For the six months ended June 30, 2018, one customer accounted for approximately 14% of total revenues.

For the six months ended June 30, 2017, two customers accounted for approximately 45% and 29%, respectively, of total revenues.

Public Offering of Units

On August 2, 2016, the Company’s Registration Statement on Form S-1 was declared effective by the Securities and Exchange Commission. On a self-underwritten basis, the Company is offering up to 40,000,000 Units at a price of $0.05 per Unit or $2,000,000 maximum. Each Unit consists of one share of Company common stock and one warrant to purchase ½ share of Company common stock at a price of $0.10 per share for a period of three years. There is no minimum offering amount or escrow required as a condition to closing and the Company may sell significantly fewer Units than those offered. The offering will terminate on August 2, 2018 unless earlier terminated or extended by the Company’s filing of an amendment to the Registration Statement. To date, no Units have been sold.

NOTE 13 – Related Party Transactions

ProAdvanced Group, Inc. (“PAG”), an entity controlled by the Company’s chief executive officer, is a customer of CANB. At June 30, 2018, CANB had an account receivable from PAG of $7,240. For the six months ended June 30, 2018, CANB had revenues from PAG of $5,000.

Island Stock Transfer (“IST”), an entity controlled by Carl Dilley, a Company director, is both a customer and vendor of CANB. At June 30, 2018, CANB had an account receivable from IST of $6,035 and an account payable to IST of $2,138. For the six months ended June 30, 2018, CANB had revenues from IST of $3,000.

Stock Market Manager, Inc. is also an entity controlled by Mr. Dilley. For the six months ended June 30, 2018, CANB had an account payable to Stock Market Manager Inc. of $1,676.

In order to facilitate its operations, the Company has entered into a Production Agreement with Pure Health Products, LLC (“PHP”), a New York limited liability company. Pursuant to the Production Agreement, PHP will manufacture, package, and sell the Company’s CBD infused products on an exclusive basis. PHP will not produce or manufacture any product containing any cannabis or hemp derivative for any person or entity other than the Company, and the Company controls the ingredients, recipe, manufacturing processes and procedures and quality and taste parameters for all Products produced at the PHP facility. PHP may also white label / rebrand or relabel the products on the Company’s behalf pursuant to “white label agreements” entered into between the Company and third-party customers. Credit card sales are processed through PHP as well. Through its contractual relationship with PHP, the Company is able to control the manufacturing process of its products while reducing its production costs. In addition, the Company has the option to acquire certain assets of PHP should it elect to take over direct manufacture of its Products. For the six months ended June 30, 2018, purchase of CBD infused products from PHP totaled $79,754.     

At June 30, 2018, we have a note receivable from PHP in the amount of $75,000. PHP is controlled by Pasquale Ferro. At June 30, 2018, we are indebted to Mr. Ferro and his wife Rosemary Ferro in the amount of $113,500.

The Company considers Pure Health products to be a variable interest entity as prescribed under Accounting guidelines. Due to the fact that the company is not dependent on Pure Health Products solely for manufacture, no consolidation of Pure Heath Products financial information is required.

During the six months ended June 30, 2018, we had products sales to related parties totaling $0.

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NOTE 14 – Subsequent Events

On August 6, 2018, the Company and its third party landlord executed a First Amendment to Lease (see Note 12). The amendment provides for the extension of the lease term for an additional three years commencing on November 1, 2018 and ending on October 31, 2021 at monthly rental of $3,193 for year 1, $3,289 for year 2, and $3,388 for year 3.

On August 13, 2018, the Company and Pasquale and Rosemary Ferro executed an Addendum to 12% Convertible Promissory Note (the “Addendum”). The Addendum provides for an increase in the maximum principal amount of the Note facility to $300,000 and extends the maturity date of the Note to June 30, 2021. The principal balance of the notes payable due to Pasquale and Rosemary Ferro under the Note facility at June 30, 2018 was $113,500 (see Note 7).

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

General

Canbiola, Inc. was originally formed as a Florida corporation on October 11, 2005, under the name of WrapMail, Inc. Effective January 5, 2015, we acquired 100% ownership of Prosperity Systems, Inc. (“Prosperity”), a New York corporation incorporated on April 2, 2008. We provide document, project, marketing and sales management systems to business clients through our website and proprietary software and also have a division focusing on the development and sale of products containing CBD. The Company is presently in the process of dissolving Prosperity.

The consolidated financial statements include the accounts of CANB and its wholly owned subsidiary Prosperity from the date of its acquisition on January 5, 2015.

Results of Operations

Three Months Ended June 30, 2018 compared with Three Months Ended June 30, 2017:

Revenues increased $128,321 from $25,870 in 2017 to $154,191 in 2018.

Cost of product sales increased $45,713 from $1,139 in 2017 to $46,852 in 2018 due to the launch of new product sales.

Officers compensation and payroll taxes increased $56,873 from $19,377 in 2017 to $76,250 in 2018. The 2018 expense amount ($76,250) consists of compensations accrued to our Chief Executive Officer ($30,000), Executive Vice President Business Development ($30,000) and compensation paid to Chief operating Officer ($16,250) pursuant to their respective employment or service agreements. The 2017 expense amount ($19,377) consists of salaries accrued to our Chief Executive Officer ($18,000) pursuant to their respective employment agreements and related payroll taxes ($1,377).

Consulting fees increased $312,687 from $55,082 in 2017 to $367,769 in 2018. The 2018 expense amount ($367,769) includes stock-based compensation of $344,869, resulting from stock issued for the service of consultants. The 2017 expense amount ($55,082) includes stock-based compensation of $26,229, resulting from stock issued for the service of a consultants.

Directors fees decreased from $0 in 2017 to ($17,400) in 2018.

Advertising expense decreased $6,218 from $20,893 in 2017 to $14,675 in 2018.  

Hosting expense decreased $8,436 from $12,246 in 2017 to $3,810 in 2018.

Rent expense increased $535 from $16,265 in 2017 to $16,800 in 2018.

Professional fees increased $10,198 from $46,758 in 2017 to $56,956 in 2018.

Depreciation of property and equipment decreased $6 from $807 in 2017 to $801 in 2018.  

Amortization of intangible assets decreased $993 from $993 in 2017 to $0 in 2018.

Other operating expenses increased $17,338 from $38,775 in 2017 to $56,113 in 2018. The increase was due largely to higher travel expense and supplies expenses in 2018 compared to 2017.

Net loss increased from $508,448 in 2017 to $992,276 in 2018. The increase was due to the $427,691 increase in total operating expenses and the increase of $184,458 in other expense – net from $321,983 other expense – net in 2017 to $506,441 other expense– net in 2018, and the $128,321 increase in revenues.

Six Months Ended June 30, 2018 compared with Six Months Ended June 30, 2017:

Revenues increased $180,118 from $43,842 in 2017 to $223,960 in 2018.

Cost of product sales increased $90,300 from $1,139 in 2017 to $91,439 in 2018 due to the launch of new product sales.

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Officers compensation and payroll taxes increased $97,418 from $38,832 in 2017 to $136,250 in 2018. The 2018 expense amount ($136,250) consists of compensations accrued to our Chief Executive Officer ($60,000), Executive Vice President Business Development ($52,500) and compensation paid to Chief operating Officer ($23,750) pursuant to their respective employment or service agreements. The 2017 expense amount ($38,832) consists of salaries accrued to our Chief Executive Officer ($36,000) pursuant to their respective employment agreements and related payroll taxes ($2,832).

Consulting fees increased $571,894 from $71,782 in 2017 to $643,676 in 2018. The 2018 expense amount ($643,676) includes stock-based compensation of $572,777, resulting from stock issued for the service of consultants. The 2017 expense amount ($71,782) includes stock-based compensation of $37,229, resulting from stock issued for the service of a consultants.

Directors fees increased $185,400 from $0 in 2017 to $185,400 in 2018. The 2018 expense amount ($185,400) are stock-based compensation paid to two directors of the Company.

Advertising expense increased $15,498 from $21,510 in 2017 to $37,008 in 2018.  

Hosting expense decreased $7,208 from $14,687 in 2017 to $7,479 in 2018.

Rent expense increased $535 from $32,530 in 2017 to $33,065 in 2018.

Professional fees increased $7,603 from $62,736 in 2017 to $70,339 in 2018.

Depreciation of property and equipment decreased $10 from $1,614 in 2017 to $1,604 in 2018.  

Amortization of intangible assets decreased $1,986 from $1,986 in 2017 to $0 in 2018.

Other operating expenses increased $60,038 from $60,519 in 2017 to $120,827 in 2018. The increase was due largely to higher travel expense and supplies expenses in 2018 compared to 2017.

Net loss increased from $484,348 in 2017 to $584,718 in 2018. The increase was due to the $1,037,151 increase in total operating expenses, offset by the increase of $756,663 in other income – net from $220,855 other expense – net in 2017 to $535,808 other income– net in 2018, and the $180,118 increase in revenues.

Liquidity and Capital Resources

At June 30, 2018, we had cash and cash equivalents of $73,572 and negative working capital of $534,406.

Cash and cash equivalents increased $71,920 from $1,652 at December 31, 2017 to $73,572 at June 30, 2018. For the six months ended June 30, 2018, $384,000 was provided by financing activities, $38,355 was used in investing activities, and $273,725 was used in operating activities.

We currently have no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

We currently have no commitments with any person for any capital expenditures.

We have no off-balance sheet arrangements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

None.

24

ITEM 4. CONTROLS AND PROCEDURES

(A) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

As of June 30, 2018, our principal executive officer and principal financial officer conducted an evaluation regarding the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act). Based upon the evaluation of these controls and procedures, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this report.

(B) CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes in our internal control over financial reporting in our first fiscal quarter for the period ended June 30, 2018 covered by this Quarterly Report on Form 10-Q, that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

25

PART II-OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

On May 11, 2018, the Company brought an arbitration proceeding 9American Arbitration Association case 01-18-001-8823) against T8 Partners, Inc. (“T8”). The claim alleged that T8 failed to perform certain services agreed to in a Consulting Agreement dated September 6, 2017 and sought return at 2,500,000 shares of CANB common stock issued to T8 on September 7, 2017. On July 12, 2018, the Company was notified by T8 that T8 had requested its broker dealer to return the certificate for 2,500,000 shares to the Company for cancellation. As of the date of this filing, the return of the 2,500,000 shares has not yet occurred.

ITEM 1A. RISK FACTORS

As a smaller reporting company, we are not required to provide risk factors in this Form 10-Q.

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

Sales of unregistered securities during the quarterly period ended June 30, 2018 follows:

On February 7, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $9,825 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 9, 2018, the Company issued 3,000,000 and 3,000,000 shares of CANB common stock to its two directors for services rendered, respectively. The $101,400 fair value of each 3,000,000 shares of CANB common stock was charged to directors fees in the three months ended March 31, 2018.

On February 13, 2018, the Company issued 150,000 shares of CANB common stock to a consultant for services rendered. The $5,085 fair value of the 150,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 14, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $8,500 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 19, 2018, the Company issued 150,000 shares of CANB common stock to a consultant for services rendered. The $5,280 fair value of the 150,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 26, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $11,375 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On March 1, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $10,900 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended March 31, 2018.

On March 20, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $6,500 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended March 31, 2018.

On April 13, 2018, April 25, 2018, May 3, 2018, June 19, 2018 and June 25, 2018, the Company issued 1,287,129 shares, 1,287,129 shares, 1,287,129 shares, 3,545,455 shares, and 2,363,636 shares of CANB common stock to RedDiamond in exchange for the retirement of 10,000 shares, 10,000 shares, 10,000 shares, 15,000 shares and 10,000 shares of CANB Series B Preferred Stock, respectively.

On May 9, 2018, the Company issued 125,000 shares of CANB common stock to a consultant for services rendered.. The $1,812 fair value of the 125,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On May 29, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,000 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

26

On May 31, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $4,600 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2018.

On June 4, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,750 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On June 11, 2018, the Company agreed to issue 2,749,429 shares of CANB common stock to a lender in satisfaction of notes payable of $15,000 and accrued interest payable of $4,246.

On June 18, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $6,250 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On June 22, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $8,250 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2018.

With respect to the transactions noted above, each of the recipients of securities of the Company was an accredited investor, or is considered by the Company to be a “sophisticated person”, inasmuch as each of them has such knowledge and experience in financial and business matters that they are capable of evaluating the merits and risks of receiving securities of the Company. No solicitation was made and no underwriting discounts were given or paid in connection with these transactions. The Company believes that the issuance of its securities as described above was exempt from registration with the Securities and Exchange Commission pursuant to Section 4(a)(2) of the Securities Act of 1933.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

3.1	Articles of Incorporation, as amended*
3.2	Bylaws*
31.1	Rule 13a-14(a)/15d-14(a) certification of Chief Executive Officer
32.1	Section 1350 certification of Chief Executive Officer
99.1	Amendment to Articles of Incorporation and Certificate of Designations for Series B Preferred Stock **
99.2	Certificate of Designations for Series B Preferred Stock***
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
*         filed with the Form S-1 Registration Statement filed with the SEC on December 2, 2015 and incorporated            herein by reference. **       filed with the Form 8-K filed with the SEC on November 15, 2017 and incorporated herein by reference. ***     filed with the Form 8-K filed with the SEC on October 18, 2017 and incorporated herein by reference.

27

SIGNATURES

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

	CANBIOLA, INC.
Date: August 17, 2018	By:	/s/ Marco Alfonsi
		Marco Alfonsi, Chief Executive Officer

28

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, Marco Alfonsi, certify that:

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

2.    Based on my knowledge, this report does not contain any untrue statement of a 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 controls 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 quarterly 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;

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 (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

 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 controls 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 over financial reporting.

Dated: August 17, 2018	By:	/s/ Marco Alfonsi
		Marco Alfonsi, Chief Executive Officer (Principal Executive Officer)

EX-32.1

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 Canbiola, Inc. (the “Company”) on Form 10-Q for the period ended March 31, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Marco Alfonsi, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. section 1350 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.

Date: August 17, 2018	By:	/s/ Marco Alfonsi
		Marco Alfonsi Chief  Executive Officer
		(Principal Executive Officer)

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement 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.

XML

Document and Entity Information	3 Months Ended	6 Months Ended
	Jun. 30, 2018 shares	Jun. 30, 2018 shares
Document and Entity Information:
Entity Registrant Name		Canbiola, Inc.
Document Type		10-Q
Document Period End Date		Jun. 30, 2018
Trading Symbol		canb
Amendment Flag		false
Entity Central Index Key		0001509957
Current Fiscal Year End Date		--12-31
Entity Common Stock, Shares Outstanding	247,017,230	247,017,230
Entity Filer Category		Smaller Reporting Company
Entity Current Reporting Status		Yes
Entity Voluntary Filers		No
Entity Well-known Seasoned Issuer		No
Document Fiscal Year Focus		2018
Document Fiscal Period Focus		Q2
Entity Incorporation, State Country Name	Florida
Entity Incorporation, Date of Incorporation	Oct. 11, 2005

XML

Canbiola, Inc. - Consolidated Balance Sheets - USD ($)		Jun. 30, 2018	Dec. 31, 2017
Current Assets:
Cash and cash equivalents		$ 73,572	$ 1,652
Accounts receivable, less allowance for doubtful accounts	[1]	14,132	6,075
Inventory		7,122	9,834
Notes receivable - current		75,000	75,000
Prepaid expenses - current		657,042	64,911
TOTAL CURRENT ASSETS		826,868	157,472
Property and equipment, less accumulated depreciation	[2]	47,899	11,148
Other Assets:
Security Deposit		11,687	11,687
Prepaid expenses - noncurrent		467,220
Note receivable - noncurrent		39,000	39,000
Total other assets		517,907	50,687
Total Assets		1,392,674	219,307
Current Liabilities:
Notes and loans payable		261,669	193,504
Derivative Liability		727,086	1,451,137
Accounts payable		132,368	143,274
Accrued officers compensation		171,250	98,750
Other accrued expenses payable		68,901	62,539
Total current liabilities and total liabilities		1,361,274	1,949,204
Commitments and Contingencies	[3]
Stockholders' Deficiency:
Preferred stock Series A		1,786,537	243,537
Preferred stock Series B		344	150
Common stock		13,028,907	12,524,042
Additional Paid-in Capital		346,406	149,850
Additional Paid-in Capital - Stock Options	[4]	84,000
Accumulated deficit		(15,214,794)	(14,647,476)
TOTAL STOCKHOLDERS' DEFICIENCY		31,400	(1,729,897)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY		$ 1,392,674	$ 219,307

[1] Accounts receivable, less allowance for doubtful accounts of $0 and $0, respectively.

[2] Property and equipment, at cost less accumulated depreciation of $21,852 and $20,248, respectively.

[3] See Notes 12 and 13

[4] See Note 10

XML

Statement of Financial Position - Parenthetical - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Statement of Financial Position
Preferred Stock, Par Value
Preferred Stock, Shares Authorized	20	20
Preferred Stock, Shares Issued	13	8
Preferred Stock, Shares Outstanding	13	8
Preferred Stock, Series B, Par Value	$ 0.001	$ 0.001
Preferred Stock, Series B, Shares Authorized	500,000	500,000
Preferred Stock, Series B, Shares Issued	365,089	157,985
Preferred Stock, Series B, Shares Outstanding	365,089	157,985
Common Stock, Par Value
Common Stock, Shares Authorized	750,000,000	750,000,000
Common Stock, Shares Issued	247,017,230	225,572,323
Common Stock, Shares Outstanding	247,017,230	225,572,323

XML

Canbiola, Inc. - Consolidated Statements of Operations and Comprehensive Loss - USD ($)		3 Months Ended		6 Months Ended
		Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Revenues
Service Revenue		$ 5,957	$ 23,735	$ 12,757	$ 41,707
Product Sales		148,234	2,135	211,203	2,135
Total Revenues		154,191	25,870	223,960	43,842
Cost of product sales		46,852	1,139	91,439	1,139
Gross profit		107,339	24,731	132,521	42,703
Operating expenses:
Officers compensation		76,250	19,377	136,250	38,832
Consulting fees	[1]	367,769	55,082	643,676	71,782
Directors fees	[2]	(17,400)		185,400
Advertising expense		14,675	20,893	37,008	21,510
Hosting expense		3,810	12,246	7,478	14,687
Rent expense		16,800	16,265	33,065	32,530
Professional fees		56,956	46,758	70,339	62,736
Depreciation of property and equipment		801	807	1,604	1,614
Amortization of intangible assets			993		1,986
Other		56,113	38,775	120,827	60,519
TOTAL OPERATING EXPENSES		575,774	211,196	1,235,647	306,196
Loss from operations		(468,435)	(186,465)	(1,103,126)	(263,493)
Other income (expense):
Interest income		2,512	293	5,024	586
Income (expense) from derivative liability		(231,655)	(250,334)	844,051	(53,655)
Loss on stock issuance		(185,104)		(185,104)
Loss on debt conversion		(57,738)		(57,738)
Interest expense	[3]	(34,456)	(71,942)	(70,425)	(167,786)
Other income (expense) - net		(506,441)	(321,983)	535,808	(220,855)
Loss before provision for income taxes		(974,876)	(508,448)	(567,318)	(484,348)
Provision for income taxes
Net loss and comprehensive income		$ (974,876)	$ (508,448)	$ (567,318)	$ (484,348)
Net loss per common share, basic and diluted		$ (0.00)	$ (0.00)	$ (0.00)	$ (0.00)
Weighted average common shares outstanding, basic		236,270,276	158,836,059	232,957,482	153,334,334
Weighted average common shares outstanding, diluted		377,833,277	278,278,009	371,751,524	267,980,990

[1] Including stock-based compensation of $572,777, $37,229, $344,869 and $26,229, respectively

[2] Including stock-based compensation of $185,400, $0, $0 and $0, respectively

[3] Including amortization of debt discounts of $54,165, $153,105, $25,701 and $65,375, respectively

XML

Canbiola, Inc. - Consolidated Statements of Cash Flows - USD ($)		6 Months Ended
		Jun. 30, 2018	Jun. 30, 2017
Operating Activities:
Net loss		$ (567,318)	$ (484,348)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation	[1]	758,177	37,229
Loss on stock issuance		185,104
Loss on debt conversion		57,738
Debt issuance expense		14,000
Expense from derivative liability		(844,051)	53,655
Depreciation of property and equipment		1,604	1,614
Amortization of intangible assets			1,986
Amortization of debt discounts		54,165	153,105
Changes in operating assets and liabilities:
Accounts receivable, increase decrease		(8,057)	(10,948)
Inventory, increase decrease		2,712	(10,946)
Prepaid expenses, increase decrease			2,500
Accounts payable, increase decrease		(10,906)	48,896
Accrued officers compensation, increase decrease		72,500	36,000
Other accrued expenses payable, increase decrease		10,607	17,321
Net Cash Used in Operating Activities		(273,725)	(153,936)
Investing Activities:
Fixed assets additions		(38,355)
Net Cash Used in Investing Activities		(38,355)
Financing Activities:
Proceeds received from notes and loans payable		135,000	124,000
Proceeds from sale of Series B preferred stock		249,000
Net Cash Provided by Financing Activities		384,000	124,000
Increase (decrease) in cash and cash equivalents		71,920	(29,936)
Cash and cash equivalents, beginning of period		1,652	30,193
Cash and cash equivalents, end of period		73,572	257
SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes paid
Interest paid
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Issuance of common stock in satisfaction of debt		15,000	65,000
Issuance of common stock in satisfaction of directors fees		202,800
Issuance of common stock in satisfaction of accrued interest		$ 4,246	$ 7,837

[1] Net of prepaid stock-based consulting fees

XML

Note 1 - Organization and Description of Business

6 Months Ended

Jun. 30, 2018

Notes

Note 1 - Organization and Description of Business

NOTE 1 – Organization and Description of Business

Canbiola, Inc. was originally incorporated as WrapMail, Inc. (“WRAP”) in Florida  on October 11, 2005.  Effective January 5, 2015, WRAP acquired 100% ownership of Prosperity Systems, Inc. (“Prosperity”), a New York corporation incorporated on April 2, 2008.  On May 15, 2017, WRAP changed its name to Canbiola, Inc. (the “Company” or “CANB” or “Canbiola”). The Company operates several divisions, including document management and email marketing platforms and a division specializing in the sale of products containing CBD. The Company used to operate its document and information platform from its wholly owned subsidiary, Prosperity Systems, Inc; however, after the acquisition of Prosperity, the Company transferred Prosperity’s operations to WRAP and is presently in the process of dissolving Prosperity. For the periods presented, the assets, liabilities, revenues, and expenses are those of CANB. Prosperity had no activity for the periods presented.

Effective December 27, 2010, WRAP effected a 10 for 1 forward stock split of its common stock. Effective June 4, 2013, WRAP effected a 1 for 10 reverse stock split of its common stock. The accompanying consolidated financial statements retroactively reflect these stock splits.

Canbiola, Inc. is a US Company specializing in the sale of a variety of Cannabidiol (CBD) based products derived from Hemp, such as oils, creams, moisturizers, chews, vapes, isolate, gel caps, concentrate and water. Canbiola is developing their own line of proprietary products as well as seeking synergistic value through acquisitions in the Hemp Industry. Canbiola aims to be the premier provider of the highest quality Hemp derived natural CBD products on the market through sourcing the very best raw material and developing a variety of products we believe will improve people's lives in a variety of areas.

CANB expects to concentrate its future business activities on the sale of CBD products and does not plan to market or further develop its technology products.

XML

Note 2 - Going Concern Uncertainty

6 Months Ended

Jun. 30, 2018

Notes

Note 2 - Going Concern Uncertainty

NOTE 2 – Going Concern Uncertainty

The consolidated financial statements have been prepared on a “going concern” basis, which contemplates the realization of assets and liquidation of liabilities in a normal course of business. As of June 30, 2018, the Company had cash and cash equivalents of $73,572 and a working capital deficit of $534,406. For the six months ended June 30, 2018 and 2017, the Company had net loss of $567,318 and $484,348, respectively. These factors raise substantial doubt as to the Company’s ability to continue as a going concern. The Company plans to improve its financial condition by raising capital through sales of shares of its common stock. Also, the Company plans to expand its operation of CBD products to increase its profitability. The consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

XML

Note 3 - Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2018

Notes

Note 3 - Summary of Significant Accounting Policies

NOTE 3 – Summary of Significant Accounting Policies

(a)  Principles of Consolidation

The consolidated financial statements include the accounts of CANB and its wholly owned subsidiary Prosperity from the date of its acquisition on January 5, 2015. All intercompany balances and transactions have been eliminated in consolidation.

The Company considers Pure Health products to be a variable interest entity as prescribed under Accounting guidelines. Due to the fact that the company is not dependent on Pure Health Products solely for manufacture, no consolidation of Pure Heath Products financial information is required.

(b)  Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.  Actual results could differ from those estimates.

(c)  Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, notes receivable, notes and loans payable, accounts payable, and accrued expenses payable. Except for the noncurrent note receivable, the fair value of these financial instruments approximate their carrying amounts reported in the balance sheets due to the short term maturity of these instruments. Based on comparable instruments with similar terms, the fair value of the noncurrent note receivable approximates its carrying value.

Pursuant to ASC 820, Fair Value Measurements and Disclosures, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1 - applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2 - applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3 - applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

(d)  Cash and Cash Equivalents

The Company considers all liquid investments purchased with a maturity of three months or less to be cash equivalents.

(e)  Inventory

All inventories are finished goods, and stated at the lower of cost or net realizable value. Cost is principally determined using the first-in, first-out (FIFO) method.

(f)  Property and Equipment, Net

Property and equipment, net, is stated at cost less accumulated depreciation.  Depreciation is calculated using the straight-line method over the estimated useful lives of the respective assets.  Maintenance and repairs are charged to operations as incurred.

(g)  Intangible Assets, Net

Intangible assets, net, are stated at cost less accumulated amortization.  Amortization is calculated using the straight-line method over the estimated economic lives of the respective assets.

(h)  Goodwill and Intangible Assets with Indefinite Lives

The Company does not amortize goodwill and intangible assets with indefinite useful lives, but instead tests for impairment at least annually.  When conducting the annual impairment test for goodwill, the Company compares the estimated fair value of a reporting unit containing goodwill to its carrying value.  If the estimated fair value of the reporting unit is determined to be less than its carrying value, goodwill is reduced, and an impairment loss is recorded.

 (i)  Long-lived Assets

The Company reviews long-lived assets held and used, intangible assets with finite useful lives and assets held for sale for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  If an evaluation of recoverability is required, the estimated undiscounted future cash flows associated with the asset is compared to the asset’s carrying amount to determine if a write-down is required.  If the undiscounted cash flows are less than the carrying amount, an impairment loss is recorded to the extent that the carrying amount exceeds the fair value.

(j)  Revenue Recognition

The Company recognizes service revenue over agreed periods of services delivered to customers and recognizes product sales upon shipment of the ordered products to customers, provided there are no uncertainties regarding customer acceptance, persuasive evidence of an arrangement exists; the sales price is fixed or determinable; and collectability is deemed probable.

(k) Stock-Based Compensation

Stock-based compensation is accounted for at fair value in accordance with Accounting Standards Codification (“ASC”) Topic 718, “Compensation – Stock Compensation” (“ASC718”) and ASC 505-50, “Equity – Based Payments to Non-Employees.”

In addition to requiring supplemental disclosures, ASC 718 addresses the accounting for share-based payment transactions in which a company receives goods or services in exchange for (a) equity instruments of the company or (b) liabilities that are based on the fair value of the company’s equity instruments or that may be settled by the issuance of such equity instruments.  ASC 718 focuses primarily on accounting for transactions in which a company obtains employee services in share-based payment transactions.

In accordance with ASC 505-50, the Company determines the fair value of the stock based payment as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of either (1) the date at which a commitment for performance by the counterparty to earn the equity instrument is reached, or (2) the date at which the counterparty’s performance is complete.

Options and warrants

The fair value of stock options and warrants is estimated on the measurement date using the Black-Scholes model with the following assumptions, which are determined at the beginning of each year and utilized in all calculations for that year:

        Risk-Free Interest Rate.

        We utilized the U.S. Treasury yield curve in effect at the time of grant with a term consistent with the expected term of our awards. 

        Expected Volatility.

        We calculate the expected volatility based on a volatility index of peer companies as we did not have sufficient historical market information to estimate the volatility of our own stock.

        Dividend Yield.

        We have not declared a dividend on its common stock since its inception and have no intentions of declaring a dividend in the foreseeable future and therefore used a dividend yield of zero.

        Expected Term.

        The expected term of options granted represents the period of time that options are expected to be outstanding.  We         estimated the expected term of stock options by using the simplified method.  For warrants, the expected term represents the actual term of the warrant.

        Forfeitures.

        Estimates of option forfeitures are based on our experience. We will adjust our estimate of forfeitures over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of compensation expense to be recognized in future periods.

(l)  Advertising

Advertising costs are expensed as incurred and amounted to $37,008 and $21,510 for the six months ended June 30, 2018 and 2017, respectively.

(m) Research and Development

Research and development costs are expensed as incurred.

(n)  Income Taxes

Income taxes are accounted for under the assets and liability method.  Current income taxes are provided in accordance with the laws of the respective taxing authorities.  Deferred income taxes are provided for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.  Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is not more likely than not that some portion or all of the deferred tax assets will be realized.

The Company has adopted the provisions required by the Income Taxes topic of the FASB Accounting Standards Codification.  The Codification Topic requires the recognition of potential liabilities as a result of management’s acceptance of potentially uncertain positions for income tax treatment on a “more-likely-than-not” probability of an assessment upon examination by a respective taxing authority. The Company believes that it has not taken any uncertain tax positions and thus has not recorded any liability.

(o)  Net Income (Loss) per Common Share

Basic net income (loss) per common share is computed on the basis of the weighted average number of common shares outstanding during the period.

Diluted net income (loss) per common share is computed on the basis of the weighted average number of common shares and dilutive securities (such as stock options and convertible securities) outstanding.  Dilutive securities having an anti-dilutive effect on diluted net income (loss) per share are excluded from the calculation. For the periods presented, the diluted net loss per share calculation excluded the effect of Series B preferred stocks and stock options outstanding (see Notes 7, 8 and 10).

(p)  Recent Accounting Pronouncements

In May 2014, the FASB issued ASU 2014-09 "Revenue from Contracts with Customers" (Topic 606) which establishes revenue recognition standards. ASU 2014-19 is effective for annual reporting periods beginning after December 15, 2017. The update establishes management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern including related disclosures. The impact of ASU 2014-19 on the Company’s financial statements has not been significant.

In 2016, the FASB issued ASU 2016-2 (Topic 842) which establishes a new lease accounting model for lessees. Under the new guidance, lessees will be required to recognize right of use assets and liabilities for most leases having terms of 12 months or more. ASU 2016-2 is effective for fiscal years beginning after December 15, 2018. The impact on the Company's financial statements is not expected to be significant.

(q) Reclassifications

Certain amounts in the prior year consolidated financial statements have been reclassified to conform to the current year presentation. These reclassification adjustments had no effect on the Company's previously reported net income.

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Note 4 - Notes Receivable

6 Months Ended

Jun. 30, 2018

Notes

Note 4 - Notes Receivable

NOTE 4 – Notes Receivable

Notes receivable consist of:
	June 30,  2018	December 31,  2017
Secured Promissory note dated October 17, 2017 due from Pure Health         Products, LLC (“PHP”), interest at 12% per annum, due October         17, 2018, secured by assets of PHP	$     75,000		$     75,000
Note receivable dated November 30, 2015 from Stock Market Manager, Inc, interest at 3% per annum due November 30, 2020	39,000		39,000
Total	114,000		114,000
Current portion of notes receivable	(75,000)		(75,000)
Noncurrent portion of notes receivable	$     39,000		$     39,000

Pursuant to an option Agreement dated November 10, 2017, the Company has an option expiring November 10, 2027 to purchase certain specified assets of Pure Health for $75,000, payable via cancellation of Pure Health’s obligations under the Secured Promissory Note or in cash or cash equivalent.

Stock Market Manager, Inc is affiliated with Carl Dilley, a Company director.

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Note 5 - Property and Equipment, Net

6 Months Ended

Jun. 30, 2018

Notes

Note 5 - Property and Equipment, Net

NOTE 5 – Property and Equipment, Net

Property and Equipment, net, consist of:

	June 30, 2018	December 31, 2017
Furniture & Fixtures	$     19,018	$     19,018
Office Equipment	12,378	12,378
Manufacturing Equipment	38,355	-
Total	69,751	31,396
Accumulated amortization	(21,852)	(20,248)
Net	$     47,899	$     11,148

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Note 6 - Intangible Assets, Net

6 Months Ended

Jun. 30, 2018

Notes

Note 6 - Intangible Assets, Net

NOTE 6 – Intangible Assets, Net

Intangible assets, net, consist of:

	June 30,  2018	December 31, 2017
Video conferencing software acquired
by Prosperity in December 2009	$   30,000	$     30,000
Enterprise and audit software acquired
by Prosperity in April 2008	20,000	20,000
Patent costs incurred by WRAP	6,880	6,880
Other	3,548	3,548
Total	60,428	60,428
Accumulated amortization and Impairment	(60,428)	(60,428)
Net	$              0	$               0

The above intangible assets relate to the document management and email marketing divisions. At December 31, 2017, we do not expect any future positive cash flow from these divisions. Accordingly, we have recorded an impairment expense of $21,509 at December 31, 2017 and reduced the net carrying value of these intangible assets to $0.

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Note 7 - Notes and Loans Payable

6 Months Ended

Jun. 30, 2018

Notes

Note 7 - Notes and Loans Payable

NOTE 7 – Notes and Loans Payable

Notes and loans payable consist of:
	June 30,  2018	December 31,  2017
Convertible notes payable to lender dated from March 15, 2016 (as amended June 2, 2016) to November 15, 2017, interest at rates ranging from 12% to 14.99% per annum, due from April 6, 2017 to May 15, 2018, partially converted at March 22, 2017 and the remaining notes convertible into Common Stock at a Conversion Price equal to the lesser of (i) $0.01 per share or (ii) 50% of the lowest Closing Bid Price of the Common Stock for the 30 Trading Days preceding the Conversion Date – net of         unamortized debt discount of $0 and $1,815, respectively	38,500		36,685
Convertible notes payable to lender dated February 1, 2016 (as amended         December 21, 2016) and December 21, 2016, interest at 12% per         annum, due February 1, 2017 and May 20, 2017, convertible into         Common Stock at a Conversion Price equal to the lesser of (i) $0.01 per         share or (ii) 50% of the lowest Closing Bid Price of the Common Stock         for the 30 Trading Days preceding the Conversion Date – net of         unamortized debt discount of $0 and $0, respectively. The note date dated          February 1, 2016 was fully converted at June 11, 2018	50,000		65,000
Convertible notes payable to Pasquale and Rosemary Ferro dated from         May 2, 2017 to May 4, 2018, interest at 12% per annum, due from         September 16, 2017 to May 7, 2019 (as amended May 4, 2018),         convertible into Common Stock at a Conversion Price equal to the lesser         of (i) $0.01 per share or (ii) 50% of the lowest Closing Bid Price of the         Common Stock for the 30 Trading Days preceding the Conversion Date –         net of unamortized debt discount of $8,451 and $19,613, respectively	105,049		73,887
Convertible note payable to lender dated August 8, 2017 interest at 12% per         annum, due August 8, 2018, convertible into Common Stock at a         Conversion Price equal to the lesser of (i) $0.01 per share or (ii) 50% of         the lowest Closing Bid Price of the Common Stock for the 30 Trading         Days preceding the Conversion Date – net of unamortized debt discount         of $2,671 and $15,068, respectively	22,329		9,932
Convertible note payable to lender dated June 6, 2018, interest at 12% per         annum, due March 6, 2019, convertible into Common Stock at a         Conversion Price equal to the lesser of 55% of the lowest Closing Bid         Price of the Common Stock for the 25 Trading Days preceding the        (i) Inception date or (ii) the Conversion Date – net of unamortized debt         discount of $91,209 and $0, respectively	22,791		-
Note payable to brother of Marco Alfonsi, Chief Executive Officer of the Company, interest at 10% per annum, due August 22, 2016 (now past due)	5,000		5,000
Note payable to Carl Dilley, a director of the Company, interest at 12.99% per annum, due February 1, 2021	15,000		-
Loan payable to Mckenzie Webster Limited (“MWL”), an entity controlled by the former Chairman of the Board of Directors of the Company, non-interest bearing, due on demand	3,000		3,000
Total	$    261,669		$    193,504

The derivative liability of the convertible notes payable consists of:

	June 30, 2018				December 31, 2017
	Face Value		Derivative Liability		Face Value		Derivative Liability
Convertible notes payable to lender dated from March 15, 2016 (as amended June 2, 2016) to November 15, 2017, due from April 6, 2017 to May 15, 2018		38,500	$	74,119		38,500		248,597
Convertible notes payable to lender dated            February 1, 2016 (as amended         December 21, 2016) and December 21,         2016, due February 1, 2017 and May         20, 2017.The note date dated          February 1, 2016 was fully converted at         June 11, 2018		50,000		96,258		65,000		418,889
Convertible notes payable to Pasquale and         Rosemary Ferro dated from May 2,         2017 to January 8, 2018, due from         September 16, 2017 to May 7, 2019 (as          amended May 4, 2018)		113,500		258,669		93,500		611,886
Convertible notes payable to lender dated         June 6, 2018, due March 6, 2019		114,000		248,184		-		-
Convertible notes payable to lender dated         August 8, 2017, due August 8, 2018		25,000		49,856		25,000		171,765
Totals	$	341,000	$	727,086	$	222,000	$	1,451,137

The above convertible notes contain a variable conversion feature based on the future trading price of the Company common stock. Therefore, the number of shares of common stock issuable upon conversion of the notes is indeterminate. Accordingly, we have recorded the fair value of the embedded conversion features as a derivative liability at the respective issuance dates (or amendment dates) of the notes ($460,316 total for the six months ended June 30, 2018) and charged the applicable amounts to debt discounts ($120,000 total for the six months ended June 30, 2018) and the remainder to other expense ($340,316 total for the six months ended June 30, 2018). The increase (decrease) in the fair value of the derivative liability from the respective issuance dates (or amendment dates) of the notes to the measurement date ($1,160,391 total decrease for the six months ended June 30, 2018) is charged (credited) to other expense (income). The fair value of the derivative liability of the notes is measured at the respective issuance dates and quarterly thereafter using the Black Scholes option pricing model. Assumptions used for the calculations of the derivative liability of the notes at June 30, 2018 include (1) stock price of $0.0215 per share, (2) exercise price of $0.0074 per share, (3) terms ranging from 0 days to 311 days, (4) expected volatility of 269% and (5) risk free interest rates ranging from 0.00% to 2.24%.

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Note 8 - Preferred Stock

6 Months Ended

Jun. 30, 2018

Notes

Note 8 - Preferred Stock

NOTE 8 – Preferred Stock

Each share of Series A Preferred Stock is convertible into 10,000,000 shares of CANB common stock and is entitled to 20,000,000 votes.

Each share of Series B Preferred Stock has the first preference to dividends, distributions and payments upon liquidation, dissolution and winding-up of the Company, and is entitled to an accrued cumulative but not compounding dividend at the rate of 5% per annum whether or not declared. After six months of the issuance date, such share and any accrued but unpaid dividends can be converted into common stock at the conversion price which is the lower of (i) $0.0101; or (ii) the lower of the dollar volume weighted average price of CANB common stock on the trading day prior to the conversion day or the dollar volume weighted average price of CANB common stock on the conversion day. The share of Series B Preferred Stock has no voting rights.

The Company issued a total of 10 shares of CANB Series A Preferred Stock (5 shares to Mckenzie Webster Limited  and 5 shares to Marco Alfonsi) in exchange for the retirement of a total of 100,000,000 shares of CANB common stock (50,000,000 shares from Mckenzie Webster Limited and 50,000,000 shares from Marco Alfonsi).

On October 4, 2017, the Company issued 3 shares of CANB Series A Preferred Stock to Alfonsi: 2 shares were the consideration for Alfonsi’s cancellation of accrued salaries payable of $127,803 owed to Alfonsi and 1 share (valued at $63,902) was issued pursuant to the new employment agreement with Alfonsi.

On November 30, 2017, MWL converted its 5 shares of CANB Series A Preferred Stock to 50,000,000 shares of CANB common stock.

On December 5, 2017, the Company issued 157,985 shares of CANB Series B Preferred Stock to RedDiamond Partners LLC (“RedDiamond”) pursuant to a Securities Purchase Agreement (the “SPA”) dated October 13, 2017, in exchange for proceeds of $150,000, or $0.95 per CANB Series B Preferred share.

On January 22, 2018, the Company issued 87,368 shares of CANB Series B Preferred Stock to RedDiamond pursuant to an amended Securities Purchase Agreement dated January 9, 2018, in exchange for proceeds of $83,000, or $0.95 per CANB Series B Preferred share.

On February 12, 2018, the Company issued 1 share of CANB Series A Preferred Stock to David Posel pursuant to a service agreement. The fair value of the issuance is $373,000 and will be amortized over the vesting period of four years.

On February 16, 2018, the Company issued 3 shares of CANB Series A Preferred Stock to David Posel pursuant to a service agreement. The fair value of the issuance is $1,020,000 and will be amortized over the vesting period of one year.

On February 16, 2018, the Company issued 87,368 shares of CANB Series B Preferred Stock to RedDiamond pursuant to an amended Securities Purchase Agreement dated January 9, 2018, in exchange for proceeds of $83,000, or $0.95 per CANB Series B Preferred share.

On March 20, 2018, the Company issued 87,368 shares of CANB Series B Preferred Stock to RedDiamond pursuant to an amended Securities Purchase Agreement dated January 9, 2018, in exchange for proceeds of $83,000, or $0.95 per CANB Series B Preferred share.

On April 13, 2018, April 25, 2018, May 3, 2018, June 19, 2018 and June 25, 2018, RedDiamond converted its 10,000 shares, 10,000 shares, 10,000 shares, 15,000 shares and 10,000 shares of CANB Series B Preferred Stock to 1,287,129 shares, 1,287,129 shares, 1,287,129 shares, 3,545,455 shares, and 2,363,636 shares of CANB common stock, respectively.

On May 14, 2018, the Company issued 1 share of CANB Series A Preferred Stock to a consultant pursuant to a Consulting Agreement dated May 11, 2018. The $150,000 fair value of the issuance was partially charged to consulting fees in the three months ended June 30, 2018.

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Note 9 - Common Stock

6 Months Ended

Jun. 30, 2018

Notes

Note 9 - Common Stock

NOTE 9 – Common Stock

On February 2, 2017, the Company issued 200,000 shares of CANB common stock to a financial consultant for services rendered. The $11,000 fair value of the 200,000 shares of CANB common stock was charged to consulting fees in the three months ended March 31, 2017.

On February 13, 2017, the Company issued 1,685,900 shares of CANB common stock to the brother of the Chief Executive Officer of the Company in satisfaction of notes payable of $15,000 and accrued interest payable of $1,859.

On March 22, 2017, the Company issued 6,785,316 shares of CANB common stock to a lender in satisfaction of notes payable of $50,000 and accrued interest payable of $5,979.

On April 17, 2017, the Company issued 5,000,000 shares of CANB common stock to a consultant for services rendered. The $125,000 fair value of the 5,000,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2017.

On June 21, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,975 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2017.

On June 28, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,000 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2017.

On August 25, 2017, the Company issued 7,142,857 shares of CANB common stock to a lender in satisfaction of notes payable of $50,000 and accrued interest payable of $3,331.

On August 25, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $3,750 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended September 30, 2017.

On September 5, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $4,375 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended September 30, 2017.

On September 7, 2017, the Company issued 2,500,000 shares of CANB common stock to a consultant for services rendered. The $32,750 fair value of the 2,500,000 shares of CANB common stock was charged to consulting fees in the three months ended September 30, 2017.

On September 11, 2017, the Company issued 250,000 and 250,000 shares of CANB common stock to two consultants for services rendered, respectively. The $3,350 fair value of each 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended September 30, 2017.

On September 25, 2017, the Company issued 2,500,000 shares of CANB common stock to a consultant for services rendered. The $2,525 fair value of the 2,500,000 shares of CANB common stock was partially charged to consulting fees in the three months ended September 30, 2017.

On November 2, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $1,725 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended December 31, 2017.

On November 9, 2017, the Company issued 2,500,000 shares of CANB common stock to a consultant for services rendered. The $21,250 fair value of the 2,500,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On November 30, 2017, the Company issued 50,000,000 shares of CANB common stock to Mckenzie Webster Limited in exchange for the retirement of 5 shares of CANB Series A Preferred Stock.

On December 5, 2017, the Company issued 250,000 and 250,000 shares of CANB common stock to two consultants for services rendered, respectively. The $3,000 fair value of each 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On December 7, 2017, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $4,500 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On December 18, 2017, the Company issued 500,000 shares of CANB common stock to a consultant for services rendered. The $9,050 fair value of the 500,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On December 25, 2017, the Company issued 250,000 and 250,000 shares of CANB common stock to two consultants for services rendered, respectively. The $7,250 fair value of each 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended December 31, 2017.

On February 7, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $9,825 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 9, 2018, the Company issued 3,000,000 and 3,000,000 shares of CANB common stock to its two directors for services rendered, respectively. The $101,400 fair value of each 3,000,000 shares of CANB common stock was charged to directors fees in the three months ended March 31, 2018.

On February 13, 2018, the Company issued 150,000 shares of CANB common stock to a consultant for services rendered. The $5,085 fair value of the 150,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 14, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $8,500 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 19, 2018, the Company issued 150,000 shares of CANB common stock to a consultant for services rendered. The $5,280 fair value of the 150,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On February 26, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $11,375 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended March 31, 2018.

On March 1, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $10,900 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended March 31, 2018.

On March 20, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $6,500 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended March 31, 2018.

On April 13, 2018, April 25, 2018, May 3, 2018, June 19, 2018 and June 25, 2018, the Company issued 1,287,129 shares, 1,287,129 shares, 1,287,129 shares, 3,545,455 shares, and 2,363,636 shares of CANB common stock to RedDiamond in exchange for the retirement of 10,000 shares, 10,000 shares, 10,000 shares, 15,000 shares and 10,000 shares of CANB Series B Preferred Stock, respectively.

On May 9, 2018, the Company issued 125,000 shares of CANB common stock to a consultant for services rendered. The $1,812 fair value of the 125,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On May 29, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,000 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On May 31, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $4,600 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2018.

On June 4, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $5,750 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On June 11, 2018, the Company agreed to issue 2,749,429 shares of CANB common stock to a lender in satisfaction of notes payable of $15,000 and accrued interest payable of $4,246.

On June 18, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $6,250 fair value of the 250,000 shares of CANB common stock was partially charged to consulting fees in the three months ended June 30, 2018.

On June 22, 2018, the Company issued 250,000 shares of CANB common stock to a consultant for services rendered. The $8,250 fair value of the 250,000 shares of CANB common stock was charged to consulting fees in the three months ended June 30, 2018.

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Note 10 - Stock Options and Warrants

6 Months Ended

Jun. 30, 2018

Notes

Note 10 - Stock Options and Warrants

NOTE 10 – Stock Options and Warrants

A summary of stock options and warrants activity follows:

	Shares of Common Stock Exercisable Into
	Stock  Options	Warrants	Total
Balance, December 31, 2016	50,000	247,500	297,500
Granted in 2017	-	-	-
Expired in 2017	-	-	-
Balance, December 31, 2017	50,000	247,500	297,500
Granted in 1Q, 2Q 2018	3,000,000	-	3,000,000
Cancelled in 1Q, 2Q 2018	-	-	-
Balance, June 30, 2018	3,050,000	247,500	3,297,500

Issued and outstanding stock options as of June 30, 2018 consist of:

Year	Number Outstanding		Exercise	Year of
Granted	And Exercisable		Price	Expiration
2009	50,000	$	1.000	2019
2018	3,000,000	$	0.001	2023
Total	3,050,000

On June 11, 2018, the Company granted 3,000,000 options of CANB common stock to Carl Dilley, a director of the Company, in exchange for the retirement of a total of 3,000,000 shares of CANB common stock from Carl Dilley. The options are exercisable for the purchase of one share of the Registrant’s Common Stock at an exercise price of $0.001 per share. The Options are fully vested and are exercisable as of the Grant Date and all shall expire June 11, 2023. The value of the Stock Options ($84,000) were calculated using the Black Scholes option pricing model and the following assumptions: (i) $0.028 share price, (ii) 5 years term, (iii) 262.00% expected volatility, (iv) 2.80% risk free interest rate and the difference between this value and the fair value of retied shares was expensed in the quarterly period ended June 30, 2018.

Issued and outstanding warrants as of June 30, 2018 consist of:

Year	Number Outstanding		Exercise	Year of
Granted	And Exercisable		Price	Expiration
2010	247,500	$	1.00	2020
Total	247,500

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Note 11 - Income Taxes

6 Months Ended

Jun. 30, 2018

Notes

Note 11 - Income Taxes

NOTE 11 – Income Taxes

No provisions for income taxes were recorded for the periods presented since the Company incurred net losses in those periods.

The provisions for (benefits from) income taxes differ from the amounts determined by applying the U.S. Federal income tax rate of 21% and 35% to pretax income (loss) as follows:

	Six Months June 30,
	2018	2017
Expected income tax (benefit) at 21% and 35%	$  (122,791)	$      8,435
Loss on stock issuance	38,872	-
Loss on debt conversion	12,125	-
Non-deductible stock-based compensation	162,871	3,850
Non-deductible amortization of debt discounts	11,375	30,706
Non-deductible expense from derivative liability	(177,251)	(68,838)
Increase in deferred income tax assets
valuation allowance	74,799	25,847
Provision for (benefit from) income taxes	$                 -	$               -

Deferred income tax assets consist of:

	June 30, 2018	December 31, 2017
Net operating loss carryforward	1,469,157	1,394,358
Valuation allowance	(1,469,157)	(1,394,358)
Net	$                      -	$                      -

Based on management's present assessment, the Company has not yet determined it to be more likely than not that a deferred income tax asset of $1,469,176 attributable to the future utilization of the $4,329,487 net operating loss carryforward as of June 30, 2018 will be realized. Accordingly, the Company has maintained a 100% allowance against the deferred income tax asset in the financial statements at December 31, 2017. The Company will continue to review this valuation allowance and make adjustments as appropriate. The net operating loss carryforward expires in years 2025, 2026, 2027, 2028, 2029, 2030, 2031, 2032, 2033, 2034, 2035, 2036, 2037 and 2038 in the amount of $1,369, $518,390, $594,905, $686,775, $159,141, $151,874, $135,096, $166,911, $311,890, $25,511, $338,345, $386,297, $496,798 and $356,185 respectively.

Current tax laws limit the amount of loss available to be offset against future taxable income when a substantial change in ownership occurs.  Therefore, the amount available to offset future taxable income may be limited.

The Company’s U.S. Federal and state income tax returns prior to 2013 are closed and management continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings. The statute of limitations on the 2013 tax year returns expired in March 2017.

The Company recognizes interest and penalties associated with uncertain tax positions as part of the income tax provision and would include accrued interest and penalties with the related tax liability in the consolidated balance sheets. There were no interest or penalties paid during 2018 and 2017.

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Note 12 - Commitments and Contingencies

6 Months Ended

Jun. 30, 2018

Notes

Note 12 - Commitments and Contingencies

NOTE 12 – Commitments and Contingencies

Employment Agreements

On October 3, 2017, the Company executed an Executive Employment Agreement with Marco Alfonsi (“Alfonsi”) for Alfonsi to serve as the Company's chief executive officer and interim chief financial officer and secretary for cash compensation of $10,000 per month. Pursuant to the agreement, the Company issued a share of CANB Series A Preferred Stock to Alfonsi on October 4, 2017 (see Note 8). Alfonsi may terminate his employment upon 30 days written notice to the Company. The Company may terminate Alfonsi's employment upon written notice to Alfonsi by a vote of the Board of Directors.

On February 12, 2018, the Company executed an Executive Service Agreement (“Agreement”) with David Posel. The Agreement provides that Mr. Posel services as the Company’s Chief Operating Officer for a term of 4 years. The Agreement also provides for compensation to Mr. Posel of $5,000 cash per month and the issuance of 1 share of Series A Preferred Stock at the inception of the Agreement. The Agreement can be terminated upon the resignation or death of Mr. Posel, and also can be terminated by the Company due to the failure or neglect of Mr. Posel to perform his duties, or due to the misconduct of Mr. Posel in connection with the performance. On February 12, 2018, 1 share of CANB Series A Preferred Stock were issued to Mr. Posel (see Note 8).

On February 16, 2018, the Company executed an Executive Service Agreement (“Agreement”) with Andrew W Holtmeyer. The Agreement provides that Mr. Holtmeyer services as the Company’s Executive Vice President Business for a term of 3 years. The Agreement also provides for compensation to Mr. Holtmeyer of $10,000 cash per month and the issuance of 3, 2 and 1 share of Series A Preferred Stock at the beginning of each year. The Agreement can be terminated upon the resignation or death of Mr. Holtmeyer, and also can be terminated by the Company due to the failure or neglect of Mr. Holtmeyer to perform his duties, or due to the misconduct of Mr. Holtmeyer in connection with the performance. On February 16, 2018, 3 shares of CANB Series A Preferred Stock were issued to Mr. Holtmeyer (see Note 8).

Consulting Agreements

On July 29, 2017, the Company executed a Consulting Agreement with Andrew W Holtmeyer for Mr. Holtmeyer to serve as the Company's consultant for monthly cash payment of $5,000 through July 29, 2018. Effective February 16, 2018, the Company terminated the agreement due to the replacement of an Executive Service Agreement.

On September 6, 2017, the Company executed a Consulting Agreement with T8 Partners LLC (“T8”) for T8 to serve as the Company's consultant for stock compensation of a total of 10,000,000 restricted shares. Pursuant to the agreement, the Company issued 2,500,000 restricted shares of CANB common stock to T8 on September 7, 2017. Effective October 27, 2017, the Company terminated the agreement due to non-performance by T8.

On November 9, 2017, the Company executed a Consulting Agreement with Healthcare Advisory Group Company (“Healthcare”) for Healthcare to serve as the Company's consultant for stock compensation of a total of 5,000,000 restricted shares. Pursuant to the agreement, the Company issued 2,500,000 restricted shares of CANB common stock to Healthcare on November 9, 2017. Effective March 6, 2018, the Company terminated the agreement due to non-performance by Healthcare.

Lease Agreements

On December 1, 2014, Prosperity entered into a lease agreement with KLAM, Inc. for office space in Hicksville, New York for an initial term of one year commencing December 1, 2014. The lease provides for monthly rentals of $2,500 and provides Prosperity an option to renew the lease after the initial term. The Company has continued to occupy this space after November 30, 2015 under a month to month arrangement at $2,500 per month. KLAM, Inc. is controlled by the wife of the Company's chief executive officer Marco Alfonsi.

On September 11, 2015, the Company executed a lease agreement with an unrelated third party for office space in Hicksville, New York for a term of 37 months. The lease provides for monthly rentals of $2,922 for lease year 1, $3,009 for lease year 2, and $3,100 for lease year 3. The lease also provides for additional rent based on increases in base year operating expenses and real estate taxes.

Rent expense for the six months ended June 30, 2018 and 2017 was $33,065 and $32,530, respectively.

At June 30, 2018, the future minimum lease payments under non-cancellable operating leases were:

                Year ended December 31, 2018           9,300

                Total                                                      $ 9,300

Major Customers

For the six months ended June 30, 2018, one customer accounted for approximately 14% of total revenues.

For the six months ended June 30, 2017, two customers accounted for approximately 45% and 29%, respectively, of total revenues.

Public Offering of Units

On August 2, 2016, the Company’s Registration Statement on Form S-1 was declared effective by the Securities and Exchange Commission. On a self-underwritten basis, the Company is offering up to 40,000,000 Units at a price of $0.05 per Unit or $2,000,000 maximum. Each Unit consists of one share of Company common stock and one warrant to purchase ½ share of Company common stock at a price of $0.10 per share for a period of three years. There is no minimum offering amount or escrow required as a condition to closing and the Company may sell significantly fewer Units than those offered. The offering will terminate on August 2, 2018 unless earlier terminated or extended by the Company’s filing of an amendment to the Registration Statement. To date, no Units have been sold.

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Note 13 - Related Party Transactions

6 Months Ended

Jun. 30, 2018

Notes

Note 13 - Related Party Transactions

NOTE 13 – Related Party Transactions

ProAdvanced Group, Inc. (“PAG”), an entity controlled by the Company’s chief executive officer, is a customer of CANB. At June 30, 2018, CANB had an account receivable from PAG of $7,240. For the six months ended June 30, 2018, CANB had revenues from PAG of $5,000.

Island Stock Transfer (“IST”), an entity controlled by Carl Dilley, a Company director, is both a customer and vendor of CANB. At June 30, 2018, CANB had an account receivable from IST of $6,035 and an account payable to IST of $2,138. For the six months ended June 30, 2018, CANB had revenues from IST of $3,000.

Stock Market Manager, Inc. is also an entity controlled by Mr. Dilley. For the six months ended June 30, 2018, CANB had an account payable to Stock Market Manager Inc. of $1,676.

In order to facilitate its operations, the Company has entered into a Production Agreement with Pure Health Products, LLC (“PHP”), a New York limited liability company. Pursuant to the Production Agreement, PHP will manufacture, package, and sell the Company’s CBD infused products on an exclusive basis. PHP will not produce or manufacture any product containing any cannabis or hemp derivative for any person or entity other than the Company, and the Company controls the ingredients, recipe, manufacturing processes and procedures and quality and taste parameters for all Products produced at the PHP facility. PHP may also white label / rebrand or relabel the products on the Company’s behalf pursuant to “white label agreements” entered into between the Company and third-party customers. Credit card sales are processed through PHP as well. Through its contractual relationship with PHP, the Company is able to control the manufacturing process of its products while reducing its production costs. In addition, the Company has the option to acquire certain assets of PHP should it elect to take over direct manufacture of its Products. For the six months ended June 30, 2018, purchase of CBD infused products from PHP totaled $79,754.    

At June 30, 2018, we have a note receivable from PHP in the amount of $75,000. PHP is controlled by Pasquale Ferro. At June 30, 2018, we are indebted to Mr. Ferro and his wife Rosemary Ferro in the amount of $113,500.

The Company considers Pure Health products to be a variable interest entity as prescribed under Accounting guidelines. Due to the fact that the company is not dependent on Pure Health Products solely for manufacture, no consolidation of Pure Heath Products financial information is required.

During the six months ended June 30, 2018, we had products sales to related parties totaling $0.

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Note 14 - Subsequent Events

6 Months Ended

Jun. 30, 2018

Notes

Note 14 - Subsequent Events

NOTE 14 – Subsequent Events

On August 6, 2018, the Company and its third party landlord executed a First Amendment to Lease (see Note 12). The amendment provides for the extension of the lease term for an additional three years commencing on November 1, 2018 and ending on October 31, 2021 at monthly rental of $3,193 for year 1, $3,289 for year 2, and $3,388 for year 3.

On August 13, 2018, the Company and Pasquale and Rosemary Ferro executed an Addendum to 12% Convertible Promissory Note (the “Addendum”). The Addendum provides for an increase in the maximum principal amount of the Note facility to $300,000 and extends the maturity date of the Note to June 30, 2021. The principal balance of the notes payable due to Pasquale and Rosemary Ferro under the Note facility at June 30, 2018 was $113,500 (see Note 7).

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Note 3 - Summary of Significant Accounting Policies: (a) Principles of Consolidation (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(a) Principles of Consolidation

(a)  Principles of Consolidation

The consolidated financial statements include the accounts of CANB and its wholly owned subsidiary Prosperity from the date of its acquisition on January 5, 2015. All intercompany balances and transactions have been eliminated in consolidation.

The Company considers Pure Health products to be a variable interest entity as prescribed under Accounting guidelines. Due to the fact that the company is not dependent on Pure Health Products solely for manufacture, no consolidation of Pure Heath Products financial information is required.

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Note 3 - Summary of Significant Accounting Policies: (b) Use of Estimates (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(b) Use of Estimates

(b)  Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.  Actual results could differ from those estimates.

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Note 3 - Summary of Significant Accounting Policies: (c) Fair Value of Financial Instruments (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(c) Fair Value of Financial Instruments

(c)  Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, notes receivable, notes and loans payable, accounts payable, and accrued expenses payable. Except for the noncurrent note receivable, the fair value of these financial instruments approximate their carrying amounts reported in the balance sheets due to the short term maturity of these instruments. Based on comparable instruments with similar terms, the fair value of the noncurrent note receivable approximates its carrying value.

Pursuant to ASC 820, Fair Value Measurements and Disclosures, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1 - applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2 - applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3 - applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

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Note 3 - Summary of Significant Accounting Policies: (d) Cash and Cash Equivalents (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(d) Cash and Cash Equivalents

(d)  Cash and Cash Equivalents

The Company considers all liquid investments purchased with a maturity of three months or less to be cash equivalents.

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Note 3 - Summary of Significant Accounting Policies: (e) Inventory (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(e) Inventory

(e)  Inventory

All inventories are finished goods, and stated at the lower of cost or net realizable value. Cost is principally determined using the first-in, first-out (FIFO) method.

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Note 3 - Summary of Significant Accounting Policies: (f) Property and Equipment, Net (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(f) Property and Equipment, Net

(f)  Property and Equipment, Net

Property and equipment, net, is stated at cost less accumulated depreciation.  Depreciation is calculated using the straight-line method over the estimated useful lives of the respective assets.  Maintenance and repairs are charged to operations as incurred.

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Note 3 - Summary of Significant Accounting Policies: (g) Intangible Assets, Net (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(g) Intangible Assets, Net

(g)  Intangible Assets, Net

Intangible assets, net, are stated at cost less accumulated amortization.  Amortization is calculated using the straight-line method over the estimated economic lives of the respective assets.

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Note 3 - Summary of Significant Accounting Policies: (h) Goodwill and Intangible Assets With Indefinite Lives (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(h) Goodwill and Intangible Assets With Indefinite Lives

(h)  Goodwill and Intangible Assets with Indefinite Lives

The Company does not amortize goodwill and intangible assets with indefinite useful lives, but instead tests for impairment at least annually.  When conducting the annual impairment test for goodwill, the Company compares the estimated fair value of a reporting unit containing goodwill to its carrying value.  If the estimated fair value of the reporting unit is determined to be less than its carrying value, goodwill is reduced, and an impairment loss is recorded.

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Note 3 - Summary of Significant Accounting Policies: (i) Long-lived Assets (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(i) Long-lived Assets

 (i)  Long-lived Assets

The Company reviews long-lived assets held and used, intangible assets with finite useful lives and assets held for sale for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  If an evaluation of recoverability is required, the estimated undiscounted future cash flows associated with the asset is compared to the asset’s carrying amount to determine if a write-down is required.  If the undiscounted cash flows are less than the carrying amount, an impairment loss is recorded to the extent that the carrying amount exceeds the fair value.

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Note 3 - Summary of Significant Accounting Policies: (j) Revenue Recognition (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(j) Revenue Recognition

(j)  Revenue Recognition

The Company recognizes service revenue over agreed periods of services delivered to customers and recognizes product sales upon shipment of the ordered products to customers, provided there are no uncertainties regarding customer acceptance, persuasive evidence of an arrangement exists; the sales price is fixed or determinable; and collectability is deemed probable.

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Note 3 - Summary of Significant Accounting Policies: (k) Stock-based Compensation (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(k) Stock-based Compensation

(k) Stock-Based Compensation

Stock-based compensation is accounted for at fair value in accordance with Accounting Standards Codification (“ASC”) Topic 718, “Compensation – Stock Compensation” (“ASC718”) and ASC 505-50, “Equity – Based Payments to Non-Employees.”

In addition to requiring supplemental disclosures, ASC 718 addresses the accounting for share-based payment transactions in which a company receives goods or services in exchange for (a) equity instruments of the company or (b) liabilities that are based on the fair value of the company’s equity instruments or that may be settled by the issuance of such equity instruments.  ASC 718 focuses primarily on accounting for transactions in which a company obtains employee services in share-based payment transactions.

In accordance with ASC 505-50, the Company determines the fair value of the stock based payment as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of either (1) the date at which a commitment for performance by the counterparty to earn the equity instrument is reached, or (2) the date at which the counterparty’s performance is complete.

Options and warrants

The fair value of stock options and warrants is estimated on the measurement date using the Black-Scholes model with the following assumptions, which are determined at the beginning of each year and utilized in all calculations for that year:

        Risk-Free Interest Rate.

        We utilized the U.S. Treasury yield curve in effect at the time of grant with a term consistent with the expected term of our awards. 

        Expected Volatility.

        We calculate the expected volatility based on a volatility index of peer companies as we did not have sufficient historical market information to estimate the volatility of our own stock.

        Dividend Yield.

        We have not declared a dividend on its common stock since its inception and have no intentions of declaring a dividend in the foreseeable future and therefore used a dividend yield of zero.

        Expected Term.

        The expected term of options granted represents the period of time that options are expected to be outstanding.  We         estimated the expected term of stock options by using the simplified method.  For warrants, the expected term represents the actual term of the warrant.

        Forfeitures.

        Estimates of option forfeitures are based on our experience. We will adjust our estimate of forfeitures over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of compensation expense to be recognized in future periods.

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Note 3 - Summary of Significant Accounting Policies: (l) Advertising (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(l) Advertising

(l)  Advertising

Advertising costs are expensed as incurred and amounted to $37,008 and $21,510 for the six months ended June 30, 2018 and 2017, respectively.

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Note 3 - Summary of Significant Accounting Policies: (m) Research and Development (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(m) Research and Development

(m) Research and Development

Research and development costs are expensed as incurred.

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Note 3 - Summary of Significant Accounting Policies: (n) Income Taxes (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(n) Income Taxes

(n)  Income Taxes

Income taxes are accounted for under the assets and liability method.  Current income taxes are provided in accordance with the laws of the respective taxing authorities.  Deferred income taxes are provided for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.  Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is not more likely than not that some portion or all of the deferred tax assets will be realized.

The Company has adopted the provisions required by the Income Taxes topic of the FASB Accounting Standards Codification.  The Codification Topic requires the recognition of potential liabilities as a result of management’s acceptance of potentially uncertain positions for income tax treatment on a “more-likely-than-not” probability of an assessment upon examination by a respective taxing authority. The Company believes that it has not taken any uncertain tax positions and thus has not recorded any liability.

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Note 3 - Summary of Significant Accounting Policies: (o) Net Income (loss) Per Common Share (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(o) Net Income (loss) Per Common Share

(o)  Net Income (Loss) per Common Share

Basic net income (loss) per common share is computed on the basis of the weighted average number of common shares outstanding during the period.

Diluted net income (loss) per common share is computed on the basis of the weighted average number of common shares and dilutive securities (such as stock options and convertible securities) outstanding.  Dilutive securities having an anti-dilutive effect on diluted net income (loss) per share are excluded from the calculation. For the periods presented, the diluted net loss per share calculation excluded the effect of Series B preferred stocks and stock options outstanding (see Notes 7, 8 and 10).

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Note 3 - Summary of Significant Accounting Policies: (p) Recent Accounting Pronouncements (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(p) Recent Accounting Pronouncements

(p)  Recent Accounting Pronouncements

In May 2014, the FASB issued ASU 2014-09 "Revenue from Contracts with Customers" (Topic 606) which establishes revenue recognition standards. ASU 2014-19 is effective for annual reporting periods beginning after December 15, 2017. The update establishes management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern including related disclosures. The impact of ASU 2014-19 on the Company’s financial statements has not been significant.

In 2016, the FASB issued ASU 2016-2 (Topic 842) which establishes a new lease accounting model for lessees. Under the new guidance, lessees will be required to recognize right of use assets and liabilities for most leases having terms of 12 months or more. ASU 2016-2 is effective for fiscal years beginning after December 15, 2018. The impact on the Company's financial statements is not expected to be significant.

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Note 3 - Summary of Significant Accounting Policies: (q) Reclassifications (Policies)

6 Months Ended

Jun. 30, 2018

Policies

(q) Reclassifications

(q) Reclassifications

Certain amounts in the prior year consolidated financial statements have been reclassified to conform to the current year presentation. These reclassification adjustments had no effect on the Company's previously reported net income.

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Note 4 - Notes Receivable: Schedule of Notes Receivable Text Block (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Schedule of Notes Receivable Text Block

Notes receivable consist of:
	June 30,  2018	December 31,  2017
Secured Promissory note dated October 17, 2017 due from Pure Health         Products, LLC (“PHP”), interest at 12% per annum, due October         17, 2018, secured by assets of PHP	$     75,000		$     75,000
Note receivable dated November 30, 2015 from Stock Market Manager, Inc, interest at 3% per annum due November 30, 2020	39,000		39,000
Total	114,000		114,000
Current portion of notes receivable	(75,000)		(75,000)
Noncurrent portion of notes receivable	$     39,000		$     39,000

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Note 5 - Property and Equipment, Net: Property, Plant and Equipment (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Property, Plant and Equipment

	June 30, 2018	December 31, 2017
Furniture & Fixtures	$     19,018	$     19,018
Office Equipment	12,378	12,378
Manufacturing Equipment	38,355	-
Total	69,751	31,396
Accumulated amortization	(21,852)	(20,248)
Net	$     47,899	$     11,148

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Note 6 - Intangible Assets, Net: Schedule of Intangible Assets and Goodwill (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Schedule of Intangible Assets and Goodwill

	June 30,  2018	December 31, 2017
Video conferencing software acquired
by Prosperity in December 2009	$   30,000	$     30,000
Enterprise and audit software acquired
by Prosperity in April 2008	20,000	20,000
Patent costs incurred by WRAP	6,880	6,880
Other	3,548	3,548
Total	60,428	60,428
Accumulated amortization and Impairment	(60,428)	(60,428)
Net	$              0	$               0

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Note 7 - Notes and Loans Payable: Schedule of Notes and Loans Payable Text Block (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Schedule of Notes and Loans Payable Text Block

Notes and loans payable consist of:
	June 30,  2018	December 31,  2017
Convertible notes payable to lender dated from March 15, 2016 (as amended June 2, 2016) to November 15, 2017, interest at rates ranging from 12% to 14.99% per annum, due from April 6, 2017 to May 15, 2018, partially converted at March 22, 2017 and the remaining notes convertible into Common Stock at a Conversion Price equal to the lesser of (i) $0.01 per share or (ii) 50% of the lowest Closing Bid Price of the Common Stock for the 30 Trading Days preceding the Conversion Date – net of         unamortized debt discount of $0 and $1,815, respectively	38,500		36,685
Convertible notes payable to lender dated February 1, 2016 (as amended         December 21, 2016) and December 21, 2016, interest at 12% per         annum, due February 1, 2017 and May 20, 2017, convertible into         Common Stock at a Conversion Price equal to the lesser of (i) $0.01 per         share or (ii) 50% of the lowest Closing Bid Price of the Common Stock         for the 30 Trading Days preceding the Conversion Date – net of         unamortized debt discount of $0 and $0, respectively. The note date dated          February 1, 2016 was fully converted at June 11, 2018	50,000		65,000
Convertible notes payable to Pasquale and Rosemary Ferro dated from         May 2, 2017 to May 4, 2018, interest at 12% per annum, due from         September 16, 2017 to May 7, 2019 (as amended May 4, 2018),         convertible into Common Stock at a Conversion Price equal to the lesser         of (i) $0.01 per share or (ii) 50% of the lowest Closing Bid Price of the         Common Stock for the 30 Trading Days preceding the Conversion Date –         net of unamortized debt discount of $8,451 and $19,613, respectively	105,049		73,887
Convertible note payable to lender dated August 8, 2017 interest at 12% per         annum, due August 8, 2018, convertible into Common Stock at a         Conversion Price equal to the lesser of (i) $0.01 per share or (ii) 50% of         the lowest Closing Bid Price of the Common Stock for the 30 Trading         Days preceding the Conversion Date – net of unamortized debt discount         of $2,671 and $15,068, respectively	22,329		9,932
Convertible note payable to lender dated June 6, 2018, interest at 12% per         annum, due March 6, 2019, convertible into Common Stock at a         Conversion Price equal to the lesser of 55% of the lowest Closing Bid         Price of the Common Stock for the 25 Trading Days preceding the        (i) Inception date or (ii) the Conversion Date – net of unamortized debt         discount of $91,209 and $0, respectively	22,791		-
Note payable to brother of Marco Alfonsi, Chief Executive Officer of the Company, interest at 10% per annum, due August 22, 2016 (now past due)	5,000		5,000
Note payable to Carl Dilley, a director of the Company, interest at 12.99% per annum, due February 1, 2021	15,000		-
Loan payable to Mckenzie Webster Limited (“MWL”), an entity controlled by the former Chairman of the Board of Directors of the Company, non-interest bearing, due on demand	3,000		3,000
Total	$    261,669		$    193,504

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Note 7 - Notes and Loans Payable: Schedule of Derivative Liability of Notes and Loans Payable Text Block (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Schedule of Derivative Liability of Notes and Loans Payable Text Block

	June 30, 2018				December 31, 2017
	Face Value		Derivative Liability		Face Value		Derivative Liability
Convertible notes payable to lender dated from March 15, 2016 (as amended June 2, 2016) to November 15, 2017, due from April 6, 2017 to May 15, 2018		38,500	$	74,119		38,500		248,597
Convertible notes payable to lender dated            February 1, 2016 (as amended         December 21, 2016) and December 21,         2016, due February 1, 2017 and May         20, 2017.The note date dated          February 1, 2016 was fully converted at         June 11, 2018		50,000		96,258		65,000		418,889
Convertible notes payable to Pasquale and         Rosemary Ferro dated from May 2,         2017 to January 8, 2018, due from         September 16, 2017 to May 7, 2019 (as          amended May 4, 2018)		113,500		258,669		93,500		611,886
Convertible notes payable to lender dated         June 6, 2018, due March 6, 2019		114,000		248,184		-		-
Convertible notes payable to lender dated         August 8, 2017, due August 8, 2018		25,000		49,856		25,000		171,765
Totals	$	341,000	$	727,086	$	222,000	$	1,451,137

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Note 10 - Stock Options and Warrants: Schedule of Stockholders Equity (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Schedule of Stockholders Equity

	Shares of Common Stock Exercisable Into
	Stock  Options	Warrants	Total
Balance, December 31, 2016	50,000	247,500	297,500
Granted in 2017	-	-	-
Expired in 2017	-	-	-
Balance, December 31, 2017	50,000	247,500	297,500
Granted in 1Q, 2Q 2018	3,000,000	-	3,000,000
Cancelled in 1Q, 2Q 2018	-	-	-
Balance, June 30, 2018	3,050,000	247,500	3,297,500

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Note 10 - Stock Options and Warrants: Schedule of Issued and Outstanding Stock Options Text Block (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Schedule of Issued and Outstanding Stock Options Text Block

Year	Number Outstanding		Exercise	Year of
Granted	And Exercisable		Price	Expiration
2009	50,000	$	1.000	2019
2018	3,000,000	$	0.001	2023
Total	3,050,000

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Note 10 - Stock Options and Warrants: Schedule of Issued and Outstanding Warrants Text Block (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Schedule of Issued and Outstanding Warrants Text Block

Year	Number Outstanding		Exercise	Year of
Granted	And Exercisable		Price	Expiration
2010	247,500	$	1.00	2020
Total	247,500

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Note 11 - Income Taxes: Schedule of Share-based Compensation, Activity (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Schedule of Share-based Compensation, Activity

	Six Months June 30,
	2018	2017
Expected income tax (benefit) at 21% and 35%	$  (122,791)	$      8,435
Loss on stock issuance	38,872	-
Loss on debt conversion	12,125	-
Non-deductible stock-based compensation	162,871	3,850
Non-deductible amortization of debt discounts	11,375	30,706
Non-deductible expense from derivative liability	(177,251)	(68,838)
Increase in deferred income tax assets
valuation allowance	74,799	25,847
Provision for (benefit from) income taxes	$                 -	$               -

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Note 11 - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Tables)

6 Months Ended

Jun. 30, 2018

Tables/Schedules

Schedule of Deferred Tax Assets and Liabilities

	June 30, 2018	December 31, 2017
Net operating loss carryforward	1,469,157	1,394,358
Valuation allowance	(1,469,157)	(1,394,358)
Net	$                      -	$                      -

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Note 1 - Organization and Description of Business (Details)	3 Months Ended
	Jun. 30, 2018
Details
Entity Incorporation, State Country Name	Florida
Entity Incorporation, Date of Incorporation	Oct. 11, 2005

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Note 2 - Going Concern Uncertainty (Details) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Details
Cash Equivalents, at Carrying Value	$ 73,572
Working Capital	534,406
Net loss	$ 567,318	$ 484,348

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Note 3 - Summary of Significant Accounting Policies: (l) Advertising (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Details
Advertising expense	$ 14,675	$ 20,893	$ 37,008	$ 21,510

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Note 4 - Notes Receivable: Schedule of Notes Receivable Text Block (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Pure Health Products, LLC
Note receivable	$ 75,000	$ 75,000
Stock Market Manager, Inc.
Note receivable	39,000	39,000
Total
Note receivable	114,000	114,000
Current Portion
Note receivable	(75,000)	(75,000)
NonCurrent Portion
Note receivable	$ 39,000	$ 39,000

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Note 5 - Property and Equipment, Net: Property, Plant and Equipment (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Details
Furniture and Fixtures, Gross	$ 19,018	$ 19,018
Property, Plant and Equipment, Other, Gross	12,378	12,378
Manufacturing Equipment	38,355
Property, Plant and Equipment, Gross	69,751	31,396
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment	(21,852)	(20,248)
Property, Plant and Equipment, Other, Net	$ 47,899	$ 11,148

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Note 6 - Intangible Assets, Net: Schedule of Intangible Assets and Goodwill (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Finite-Lived Patents, Gross	$ 6,880	$ 6,880
Other Finite-Lived Intangible Assets, Gross	3,548	3,548
Total Intangible Assets net	60,428	60,428
Accumulated Amortization of Intangible Assets	(60,428)	(60,428)
Intangible Assets net	0	0
Video Conferencing Software
Capitalized Computer Software, Gross	30,000	30,000
Enterprise and Audit Software
Capitalized Computer Software, Gross	$ 20,000	$ 20,000

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Note 7 - Notes and Loans Payable: Schedule of Notes and Loans Payable Text Block (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Notes payable dated March 15, 2016, interest at 14.99% per annum, due April 6, 2017
Notes Payable	$ 38,500	$ 36,685
Convertible Notes Payable to Lender dated February 1, 2016 and December 21, 2016, interest at 12% per annum, due February 1, 2017 and May 20, 2017
Notes Payable	50,000	65,000
Notes payable to Pasquale and Rosemary Ferro, interest at 14.99% per annum, due September 16, 2017
Notes Payable	105,049	73,887
Notes payable to lender, interest at 12% per annum, due August 8, 2018
Notes Payable	22,329	9,932
Notes payable to lender, interest at 12% per annum, due June 6, 2018
Notes Payable	22,791
Convertible note payable to brother of Marco Alfonsi, Chief Executive Officer of the Company, interest at 10% per annum, due August 22, 2016
Notes Payable	5,000	5,000
Note payable to Carl Dilley, interest at 12.99%, due February 1, 2021
Notes Payable	15,000
Loan payable to Mckenzie Webster Limited ("MWL"), an entity controlled by the Chairman of the Board of Directors of the Company, non-interest bearing, due on demand
Notes Payable	3,000	3,000
Total
Notes Payable	$ 261,669	$ 193,504

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Note 7 - Notes and Loans Payable: Schedule of Derivative Liability of Notes and Loans Payable Text Block (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Convertible Note payable to lender dated March 15, 2016 | Face Value
Derivative Liability of Convertible Note	$ 38,500	$ 38,500
Convertible Note payable to lender dated March 15, 2016 | Derivative Liability
Derivative Liability of Convertible Note	74,119	248,597
Convertible Note payable to lender dated February 1, 2016 and December 21, 2016 | Face Value
Derivative Liability of Convertible Note	50,000	65,000
Convertible Note payable to lender dated February 1, 2016 and December 21, 2016 | Derivative Liability
Derivative Liability of Convertible Note	96,258	418,889
Convertible Note Payable to Pasquale and Rosemary Ferro Dated May 2, 2017 | Face Value
Derivative Liability of Convertible Note	113,500	93,500
Convertible Note Payable to Pasquale and Rosemary Ferro Dated May 2, 2017 | Derivative Liability
Derivative Liability of Convertible Note	258,669	611,886
Convertible Note payable to lender dated June 6, 2018 | Face Value
Derivative Liability of Convertible Note	114,000
Convertible Note payable to lender dated June 6, 2018 | Derivative Liability
Derivative Liability of Convertible Note	248,184
Convertible Note payable to lender dated August 8, 2017 | Face Value
Derivative Liability of Convertible Note	25,000	25,000
Convertible Note payable to lender dated August 8, 2017 | Derivative Liability
Derivative Liability of Convertible Note	$ 49,856	$ 171,765

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Note 8 - Preferred Stock (Details) - shares	Jun. 30, 2018	Jun. 25, 2018	Jun. 19, 2018	May 14, 2018	May 03, 2018	Apr. 25, 2018	Apr. 13, 2018	Mar. 20, 2018	Feb. 16, 2018	Feb. 12, 2018	Jan. 22, 2018	Dec. 31, 2017	Dec. 05, 2017	Nov. 30, 2017	Oct. 04, 2017	Oct. 29, 2015
Preferred Stock, Shares Issued	13											8			3	10
Preferred Stock Series A Converted to Common Stock														50,000,000
RedDiamond Partners LLC
Preferred Stock, Shares Issued		2,363,636	3,545,455		1,287,129	1,287,129	1,287,129
Series B Preferred Stock Shares Issued								87,368	87,368		87,368		157,985
David Posel
Preferred Stock, Shares Issued									3	1
Consultant
Preferred Stock, Shares Issued				1

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Note 9 - Common Stock (Details) - shares	Jun. 30, 2018	Jun. 25, 2018	Jun. 22, 2018	Jun. 19, 2018	Jun. 18, 2018	Jun. 11, 2018	Jun. 04, 2018	May 31, 2018	May 29, 2018	May 09, 2018	May 03, 2018	Apr. 25, 2018	Apr. 13, 2018	Mar. 20, 2018	Mar. 01, 2018	Feb. 26, 2018	Feb. 19, 2018	Feb. 14, 2018	Feb. 13, 2018	Feb. 09, 2018	Feb. 07, 2018	Dec. 31, 2017	Dec. 25, 2017	Dec. 18, 2017	Dec. 07, 2017	Dec. 05, 2017	Nov. 30, 2017	Nov. 09, 2017	Nov. 02, 2017	Sep. 25, 2017	Sep. 11, 2017	Sep. 07, 2017	Sep. 05, 2017	Aug. 25, 2017	Jun. 28, 2017	Jun. 21, 2017	Apr. 17, 2017	Mar. 22, 2017	Feb. 13, 2017	Feb. 02, 2017
Common Stock, Shares Issued	247,017,230																					225,572,323
Financial Consultant
Common Stock, Shares Issued																																								200,000
Brother of Chief Executive Officer
Common Stock, Shares Issued																																							1,685,900
Lender
Common Stock, Shares Issued						2,749,429																												7,142,857				6,785,316
Consultant
Common Stock, Shares Issued		2,363,636	250,000	3,545,455	250,000		250,000	250,000	250,000	125,000	1,287,129	1,287,129	1,287,129	250,000	250,000	250,000	150,000	250,000	150,000		250,000			500,000	250,000			2,500,000	250,000	2,500,000		2,500,000	250,000	250,000	250,000	250,000	5,000,000
Two Consultants
Common Stock, Shares Issued																															250,000
Mckenzie Webster Limited
Common Stock, Shares Issued																											50,000,000
Consultant1
Common Stock, Shares Issued																							250,000			250,000
Consultant2
Common Stock, Shares Issued																							250,000			250,000
Director1
Common Stock, Shares Issued																				3,000,000
Director2
Common Stock, Shares Issued																				3,000,000

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Note 10 - Stock Options and Warrants: Schedule of Stockholders Equity (Details) - shares	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017	Dec. 31, 2016
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number	3,050,000	50,000	50,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures	3,000,000
Warrants
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number	247,500	247,500	247,500
Total
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number	3,297,500	297,500	297,500
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures	3,000,000

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Note 10 - Stock Options and Warrants: Schedule of Issued and Outstanding Stock Options Text Block (Details)	6 Months Ended
	Jun. 30, 2018 $ / shares shares
2009 Stock Options
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number	50,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ / shares	$ 1.000
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	2019 years
2018
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number	3,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ / shares	$ 0.001
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	2023 years
Total 2 Stock Options
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number	3,050,000

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Note 10 - Stock Options and Warrants: Schedule of Issued and Outstanding Warrants Text Block (Details)	6 Months Ended
	Jun. 30, 2018 $ / shares shares
2010 Warrants
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number	247,500
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ / shares	$ 1.00
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	2020 years
Total Warrants
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number	247,500

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Note 11 - Income Taxes: Schedule of Share-based Compensation, Activity (Details) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Details
Income Tax Expense (Benefit)	$ (122,791)	$ 8,435
Loss on Stock Issuance	38,872
Loss on Debt conversion	12,125
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Share-based Compensation Cost, Amount	162,871	3,850
Non-deductible Amortization of Debt Discounts	11,375	30,706
Non-Deductible Expense from Derivative Liability	(177,251)	(68,838)
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Amount	$ 74,799	$ 25,847

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Note 11 - Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Details
Operating Loss Carryforwards	$ 1,469,157	$ 1,394,358
Deferred Tax Assets, Valuation Allowance	$ (1,469,157)	$ (1,394,358)

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Note 12 - Commitments and Contingencies (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2018	Sep. 16, 2018	Sep. 14, 2017	Sep. 12, 2016	Dec. 02, 2015	Feb. 16, 2018	Feb. 12, 2018	Oct. 03, 2017
Rent expense	$ 16,800	$ 16,265	$ 33,065	$ 32,530	$ 9,300	$ 3,100	$ 3,009	$ 2,922	$ 2,500
Marco Alfonsi
Employee Cash Compensation												$ 10,000
David Posel
Employee Cash Compensation											$ 5,000
Andrew W Holtmeyer
Employee Cash Compensation										$ 10,000

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Label	Element	Value
Loss on debt conversion {1}	fil_LossOnDebtConversion	$ (57,738)
Loss on stock issuance {1}	fil_LossOnStockIssuance	$ (185,104)