UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended ~~June~~September 30, 2020

☐ 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: 333-209836

Driven Deliveries, Inc.

(Exact name of registrant as specified in its charter)

Delaware		32-0416399
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

134 Penn St.,

El Segundo, CA 90245

(Address of Principal Executive Office)

(833) 378 6420

Registrant’s Telephone Number Including Area Code

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
N/A		N/A		N/A

Indicate by check mark whether the registrant (1) has filed all reports required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☒

Explanatory Note: The Company has filed all reports required 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), however, the Company is not subject to such filing requirements.

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 ☒ No ☐

Indicate by check mark whether the registrant has submitted every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging Growth Company	☐

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

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

As of ~~August~~November 1019, 2020, there were 7577,~~191~~517,~~835~~539 shares of the issuer’s common stock outstanding.

Driven Deliveries, Inc.

Form 10-Q Report

For the Fiscal Quarter Ended ~~June~~ September 30, 2020

TABLE OF CONTENTS

		Page
Part I.	Financial Information	1
Item 1	Financial Statements:	1
	Condensed Consolidated Balance Sheets at June 30, 2020 (unaudited) and December 31, 2019	1
	Condensed Consolidated Balance Sheets at September 30, 2020 (unaudited) and December 31, 2019	1
	Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2020 and 2019 (unaudited)	2
	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2020 and 2019 (unaudited)	2
	Condensed Consolidated Statements of Stockholders’ Equity for Six Months Ended June 30, 2020 and 2019 (unaudited)	3
	Condensed Consolidated Statements of Stockholders’ Equity for Nine Months Ended September 30, 2020 and 2019 (unaudited)	3
	Condensed Consolidated Statements of Cash Flows for Six Months Ended June 30, 2020 and 2019 (unaudited)	4
	Condensed Consolidated Statements of Cash Flows for Nine Months Ended September 30, 2020 and 2019 (unaudited)	4
	Notes to Condensed Consolidated Financial Statements (unaudited)	5
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2826
Item 3	Quantitative and Qualitative Disclosures about Market Risk	3635
Item 4	Controls and Procedures	3635
Part II.	Other Information	3836
Item 1	Legal Proceedings	3836
Item 1A	Risk Factors	3937
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	3937
Item 3	Defaults upon Senior Securities	3937
Item 4	Mine Safety Disclosures	3937
Item 5	Other Information	3937
Item 6	Exhibits	3937
Signatures		4038

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

DRIVEN DELIVERIES, INC. & SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

	June 30,			December 31,
	September 30,			December 31,
	2020			2019
	(Unaudited)
ASSETS
CURRENT ASSETS
Cash	$	~~123~~511,~~788~~318		$	266,869
Accounts receivable		7069,~~903~~571			127,747
Receivable from merchant processor		-			206,734
Due from affiliate		-			346,610
Other current asset		1,898			-
Inventory		247,282			149,946
Inventory		858,307			149,946
TOTAL CURRENT ASSETS		828,171			1,097,906
TOTAL CURRENT ASSETS		1,054,896			1,097,906
Notes receivable		500,000			-
Prepaid expenses		6107,~~000~~231			-
Intangible assets, net		1211,~~229~~677,~~467~~585			4,622,267
Goodwill		1,820,999			1,271,718
Right of use asset		~~601~~544,~~801~~032			115,859
Fixed assets, net		6152,~~842~~626			81,839
Deposit		191,213			61,138
TOTAL ASSETS	$	15,~~966~~721,~~218~~857		$	7,250,727
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	3,~~157~~097,~~774~~922		$	1,238,239
Accrued expenses		23,~~342~~417,~~909~~195			462,414
Accrued taxes		782,874			784,168
Settlement payable		~~342~~642,045			352,272
Notes payable, net of unamortized debt discount of $318,553 and $480,108 as of June 30, 2020 and December 31, 2019, respectively		2,318,447			1,016,892
Notes payable, net of unamortized debt discount of $333,728 and $480,108 as of September 30, 2020 and December 31, 2019, respectively		3,338,772			1,016,892
Notes payable - related party, net of unamortized debt discount of $65,169 and $234,667 as of June 30, 2020 and December 31, 2019, respectively		173,574			-
Notes payable - related party, net of unamortized debt discount of $32,226 and $234,667 as of September 30, 2020 and December 31, 2019, respectively		202,441			-
Lease liability		~~265~~257,~~670~~772			40,217
Derivative liability		~~872~~178,~~399~~108			306,762
Acquisition liability		21,~~307~~956,~~027~~497			908,469
TOTAL CURRENT LIABILITIES		1213,~~562~~873,~~719~~626			5,109,433
Lease liability - long term		~~336~~286,~~753~~260			76,264
Acquisition liability - long term		~~222,250~~-			442,617
TOTAL LIABILITIES		1314,~~121~~159,~~722~~886			5,628,314
COMMITMENTS AND CONTINGENCIES – Note 8
STOCKHOLDERS’ EQUITY
Preferred stock, $0.0001 par value, 15,000,000 shares authorized, no shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		-			-
Preferred stock, $0.0001 par value, 15,000,000 shares authorized, no shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively		-			-
Common stock, $0.0001 par value, 200,000,000 shares authorized, 66,011,665 and 40,961,054 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively		6,602			4,096
Common stock, $0.0001 par value, 200,000,000 shares authorized, 77,517,539 and 40,961,054 shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively		7,752			4,096
Additional paid in capital		2531,~~418~~436,~~063~~888			17,387,684
Accumulated deficit		(2229,~~580~~882,~~169~~669	)		(15,241,762	)
TOTAL STOCKHOLDERS’ EQUITY		21,~~844~~561,~~496~~971			2,150,018
NON-CONTROLLING INTEREST		-			(527,605	)
TOTAL STOCKHOLDERS’ EQUITY		21,~~844~~561,~~496~~971			1,622,413
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	15,~~966~~721,~~218~~857		$	7,250,727

See accompanying notes to the condensed consolidated financial statements.

DRIVEN

DELIVERIES, INC. & SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	For the Three Months Ended			For the Three Months Ended			For the ~~Six~~Nine Months Ended			For the ~~Six~~Nine Months Ended
	June 30, 2020			June 30, 2019			June 30, 2020			June 30, 2019
	September 30, 2020			September 30, 2019			September 30, 2020			September 30, 2019
REVENUE
Sales	$	5,672,305		$	65,824		$	7,867,753		$	46,407
Gross Sales	$	7,212,418		$	1,237,885		$	16,608,963		$	1,284,292
Cost of goods sold		5,746,068			48,394			7,450,455			48,394
Discounts and returns		1,232,543			25,222			2,761,335			25,222
Gross Profit (Loss)		(73,763	)		17,430			417,298			(1,987	)
Net Sales		5,979,875			1,212,663			13,847,628			1,259,070
Cost of goods sold - Product costs		2,598,193			458,239			6,195,462			458,239
Cost of goods sold - Fulfilment Costs and Other		5,372,005			97,536			9,225,191			145,930
Total Cost of goods sold		7,970,198			555,775			15,420,653			604,169
Gross Profit (Loss)		(1,990,323	)		656,888			(1,573,025	)		654,901
OPERATING EXPENSES
Professional fees		~~396~~413,~~563~~906			~~341~~296,~~113~~735			~~847~~1,~~178~~261,084			~~508~~805,~~870~~605
Compensation		1,435,698			959,470			2,794,702			1,496,653
Compensation, includes stock-based compensation of $1,941,362 and $5,007,996 for the three months ended September 30, 2020 and 2019 and $3,022,063 and $5,979,629 for the nine months ended September 30, 2020 and 2019		2,848,861			5,691,843			5,643,563			7,188,496
General and administrative expenses		~~936~~2,~~871~~219,705			~~234~~709,~~568~~536			24,~~023~~243,~~365~~070			~~413~~1,~~432~~122,968
Sales and marketing		~~280~~355,~~617~~733			52134,~~503~~142			~~461~~817,~~370~~103			93227,~~277~~419
Total Operating Expenses		35,~~049~~838,~~749~~205			16,~~587~~832,~~654~~256			611,~~126~~964,~~615~~820			29,~~512~~344,~~232~~488
NET LOSS FROM OPERATIONS		(37,~~123~~828,~~512~~528	)		(16,~~570~~175,~~224~~368	)		(513,~~709~~537,~~316~~845	)		(28,~~514~~689,~~219~~587	)
OTHER EXPENSES
Interest expense		(~~323~~168,~~901~~263	)		(~~691~~52,318	)		(~~586~~755,~~793~~056	)		(1063,~~858~~176	)
Loss on sale of fixed asset		-			-23,727			(11,970	)		-25,582
Change in fair value of derivative liability		~~(314~~694,~~239~~291	)		-(807,250	)		~~(348~~345,~~394~~897	)		-(807,250	)
Gain (loss) on extinguishment of debt		-			2521,~~080~~387			(810,518	)		1521,~~855~~387
Total Other Expenses		~~(638~~526,~~140~~028	)		1(314,~~389~~454	)		(1,~~757~~231,~~675~~647	)		(9323,~~003~~457	)
Net loss before provision for income taxes		(37,~~761~~302,~~652~~500	)		(16,~~568~~489,~~835~~822	)		(71,~~466~~231,~~991~~647	)		(29,~~523~~013,~~222~~044	)
Provision for Income Taxes		-			-169,166			-			-169,166
NET LOSS		(37,~~761~~302,~~652~~500	)		(16,~~568~~658,~~835~~988	)		(714,~~466~~769,~~991~~492	)		(29,~~523~~182,~~222~~210	)
NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST		-			-			(128,584	)		-
NET LOSS ATTRIBUTABLE TO DRIVEN DELIVERIES, INC. & SUBSIDIARY	$	(3,7,61302,~~652~~500	)	$	(16,~~568~~658,~~835~~988	)	$	(714,~~338~~640,~~407~~908	)	$	(29,~~523~~182,~~222~~210	)
Net loss per share - basic and diluted	$	(0.0610	)	$	(0.0312	)	$	(0.1324	)	$	(0.0519	)
Weighted average number of shares outstanding during the period - basic and diluted		6572,~~060~~054,~~874~~338			4854,~~046~~222,~~180~~493			5561,~~819~~263,~~112~~796			4648,~~179~~886,~~458~~493

See accompanying notes to the condensed consolidated financial statements.

DRIVEN DELIVERIES, INC. & SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDER’S EQUITY

FOR THE ~~SIX~~THREE AND NINE MONTHS ENDED SEPTEMBER ~~JUNE~~ 30, 2020 AND 2019

(Unaudited)

	Common						Additional Paid-in			Accumulated			Non- controlling			Stock Subscription			Total Stockholders’
	Shares			Par			Capital			Deficit			Interest			Receivable			Deficit
For the three and six months ended June 30, 2019
Balance January 1, 2019		40,875,014		$	4,088		$	2,425,275		$	(2,681,192	)	$	-		$	(100,000	)	$	(351,829	)
Sale of common stock		5,060,000			506			1,011,494			-			-			-			1,012,000
Issuance of options for services		-			-			244,062			-			-			-			244,062
Issuance of warrants for services		-			-			103,632			-			-			-			103,632
Issuance of common stock and warrants for cancellation of debt		375,000			37			53,823			-			-			-			53,860
Proceeds from stock subscription receivable		-			-			-			-			-			100,000			100,000
Net loss		-			-			-			(954,387	)		-			-			(954,387	)
Balance March 31, 2019		46,310,014		$	4,631		$	3,838,286		$	(3,635,579	)	$	-		$	-		$	207,338
Sale of common stock		3,005,000		$	301		$	960,700		$	-		$	-		$	-		$	961,001
Issuance of options for services		-			-			106,986			-			-			-			106,986
Issuance of warrants for services		-			-			516,953			-			-			-			516,953
Issuance of common stock for conversion of debt		261,665			26			52,307			-			-			-			52,333
Issuances of common stock for acquisition		1,000,000			100			499,900			-			-			-			500,000
Net loss		-			-			-			(1,568,835	)		-			-			(1,568,835	)
Balance June 30, 2019		50,576,679		$	5,058		$	5,975,132		$	(5,204,414	)	$	-		$	-		$	775,776
For the three and six months ended June 30, 2020
Sale of common stock		1,320,000			132			659,868			-			-			-			660,000
Balance January 1, 2020		40,961,054		$	4,096		$	17,387,684		$	(15,241,762	)	$	(527,605	)	$	-		$	1,622,413
Cancelation of stock from legal settlement		(12,272,616	)		(1,227	)		(121,499	)		-			-			-			(122,726	)
Sale of common stock		674,000			68			336,932			-			-			-			337,000
Cancelation of stock from debt		(2,500,000	)		(250	)		-			-			-			-			(250	)
Issuance of options for services		-			-			~~121~~118,~~539~~065			-			-			-			~~121~~118,~~539~~065
Issuance of warrants for services		-			-			~~206~~4,~~265~~890,181			-			-			-			~~206~~4,~~265~~890,181
Warrants issued with notes		-			-			622,373			-			-			-			622,373
Issuance of common stock for conversion of warrants		5,072,812			507			(507	)		-			-			-			-
Issuances of common stock for merger		12,000,000			1,200			5,998,800			-			-			-			6,000,000
Warrants issued with notes		-			-			418,541			-			-			-			418,541
Reclassification of non-controlling interest for merger		-			-			(656,189	)		-			656,189			-			-
Issuances of common stock for acquisition		1,960,756			196			1,709,804			-			-			-			1,710,000
Net loss		-			-			-			(36,~~576~~658,~~755~~988	)		~~(128,584~~-	)		-			(36,~~705~~658,~~339~~988	)
Balance March 31, 2020		53,635,054		$	5,364		$	24,017,404		$	(18,818,517	)	$	-		$	-		$	5,204,251
Balance September 30, 2019		44,157,671		$	4,416		$	13,649,585		$	(11,683,402	)	$	-		$	-		$	1,790,599
Sale of common stock		1,110,000		$	111		$	554,889		$	-		$	-		$	-		$	555,000
Issuance of common stock and warrants for settlement of AP		188,000			19			93,981			-			-			-			94,000
Issuance of common stock for exercise of warrants		10,628,611			1,063			(1,063	)		-			-			-			-
Issuance of common stock for exercise of options		450,000			45			(45	)		-			-			-			--
Issuance of options for services		-			-			121,977			-			-			-			121,977
Issuance of warrants for services		-			-			630,920			-			-			-			630,920
Net loss		-			-			-			(3,761,652	)		-			-			(3,761,652	)
Balance June 30, 2020		66,011,665		$	6,602		$	25,418,063		$	(22,580,169	)	$	-		$	-		$	2,844,496

See accompanying notes to the condensed consolidated financial statements.

	Common				Additional Paid-in			Accumulated			Non- controlling			Stock Subscription		Total Stockholders’
	Shares		Par		Capital			Deficit			Interest			Receivable		Deficit
Balance January 1, 2020		40,961,054	$	4,096	$	17,387,684		$	(15,241,762	)	$	(527,605	)	$	-	$	1,622,413
Sale of common stock		674,000		68		336,932			-			-			-		337,000
Issuance of options for services		-		-		121,539			-			-			-		121,539
Issuance of warrants for services		-		-		206,265			-			-			-		206,265
Warrants issued with notes		-		-		622,373			-			-			-		622,373
Issuances of common stock for merger		12,000,000		1,200		5,998,800			-			-			-		6,000,000
Reclassification of non-controlling interest for merger		-		-		(656,189	)		-			656,189			-		-
Net loss		-		-		-			(3,576,755	)		(128,584	)		-		(3,705,339	)

Balance March 31, 2020		53,635,054	$	5,364	$	24,017,404		$	(18,818,517	)	$	-		$	-	$	5,204,251

Sale of common stock		1,110,000	$	111	$	554,889		$	-		$	-		$	-	$	555,000
Issuance of common stock and warrants for settlement of AP		188,000		19		93,981			-			-			-		94,000
Issuance of common stock for exercise of warrants		10,628,611		1,063		(1,063	)		-			-			-		-
Issuance of common stock for exercise of options		450,000		45		(45	)		-			-			-		-
Issuance of options for services		-		-		121,977			-			-			-		121,977
Issuance of warrants for services		-		-		630,920			-			-			-		630,920
Net loss		-		-		-			(3,761,652	)		-			-		(3,761,652	)

Balance June 30, 2020		66,011,665	$	6,602	$	25,418,063		$	(22,580,169	)	$	-		$	-	$	2,844,496

Sale of common stock, net of issuance costs		2,600,000		260		1,125,740			-			-			-		1,126,000
Issuance of common stock for settlement		5,000,000		500		2,749,500			-			-			-		2,750,000
Common stock issued with notes		100,000		10		133,333			-			-			-		133,343
Issuance of common stock for conversion of interest and penalties		1,088,893		108		69,162			-			-			-		69,270
Issuance of common stock for exercise of warrants		2,716,981		272		(272	)		-			-			-		-
Issuance of options for services		-		-		67,797			-			-			-		67,797
Issuance of warrants for services		-		-		1,873,565			-			-			-		1,873,565
Net loss		-		-		-			(7,302,500	)		-			-		(7,302,500	)

Balance September 30, 2020		77,517,539	$	7,752	$	31,371,545		$	(29,882,669	)	$	-		$	-	$	1,561,971

3See accompanying notes to the condensed consolidated financial statements.

~~DRIVEN DELIVERIES, INC. & SUBSIDIARY~~3

~~CONDENSED CONSOLIDATED~~DRIVEN ~~STATEMENT~~DELIVERIES, OFINC. ~~CASH~~& ~~FLOWS~~SUBSIDIARY

~~(Unaudited)~~CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

	For the Six Months Ended			For the Six Months Ended
	June 30, 2020			June 30, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(7,466,991	)	$	(2,523,222	)
Adjustments to reconcile net loss to net cash used in operating activities
Loss on extinguishment of debt		810,518			(1,856	)
Stock based compensation		1,080,701			971,633
Amortization of right-of-use asset		-			4,199
Amortization of debt discount		468,192			-
Depreciation and amortization expense		880,522			6,052
Change in fair value of derivative liability		348,394			-
Loss on sale of fixed asset		11,970			-
Changes in operating assets and liabilities
Inventory		(575,911	)		(47,350	)
Settlement payable		(10,227	)		-
Deposit		(101,575	)		(270	)
Accounts payable and accrued compensation		2,324,262			(30,621	)
Accrued taxes		(1,294	)		-
Accounts receivable		56,844			-
Other current asset		204,836			-
Prepaid		(6,000	)		-
Net Cash Used In Operating Activities		(1,975,759	)		(1,621,435	)
CASH FLOWS FROM INVESTING ACTIVITIES
Cash acquired in acquisition		20,678			123,088
Cash payment for acquisition liability		(220,000	)		(150,000	)
Purchase of fixed assets		-			(40,339	)
Net Cash Used In Investing Activities		(199,322	)		(67,251	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from stock receivable		-			100,000
Proceeds from loan payable		1,140,000			-
Repayments of loan payable		-			(50,000	)
Proceeds from loan payable - related party		-			23,726
Repayments of loan payable - related party		-			(8,705	)
Common stock issued for cash		892,000			1,973,001
Net Cash Provided By Financing Activities		2,032,000			2,038,022
NET INCREASE (DECREASE) IN CASH		(43,081	)		349,336
CASH AT BEGINNING OF PERIOD		266,869			5,249
CASH AT END OF PERIOD	$	123,788		$	354,585
Supplemental cash flow information:
NON-CASH INVESTING AND FINANCING ACTIVITIES
Warrants and consideration - business combination	$	7,294,226		$	-
Common stock and contingent consideration - business combination	$	-		$	2,597,978
Issuance of common stock and warrants for cancellation of debt	$	-		$	106,193
Lease liability recognized from right of use asset	$	582,065		$	266,869
Settlement of related party AP for related party debt	$	30,000		$	-
Issuance of common stock and warrants for settlement of AP	$	94,000		$	-

(Unaudited)

See accompanying notes to the condensed consolidated financial statements.

	For the Nine Months Ended			For the Nine Months Ended
	September 30, 2020			September 30, 2019

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(14,769,492	)	$	(9,182,210	)
Adjustments to reconcile net loss to net cash used in operating activities
Gain/loss on extinguishment of debt		810,518			(521,387	)
Stock-based compensation		3,022,063			5,979,629
Amortization of right-of-use asset		(621	)		4,199
Amortization of debt discount		548,752			45,959
Depreciation and amortization expense		1,441,619			123,229
Change in fair value of derivative liability		(345,897	)		807,250
Settlement expense paid in stock		2,144,606			-
Gain/loss on sale of fixed asset		11,970			(25,582	)
Changes in operating assets and liabilities
Inventory		35,114			(107,679	)
Settlement payable		289,773			-
Deposit		(101,575	)		-
Accounts payable and accrued compensation		3,542,556			388,475
Accrued taxes		(1,294	)		168,766
Accounts receivable		58,176			(5,993	)
Other current asset		206,734			-
Prepaid expense		(107,231	)		-
Net Cash Used In Operating Activities		(3,214,229	)		(2,325,344	)

CASH FLOWS FROM INVESTING ACTIVITIES
Cash acquired in acquisition		20,678			123,088
Cash payment for acquisition liability		(220,000	)		(150,000	)
Purchase of fixed assets		-			(40,537	)
Contingent liability		-			(320,000	)
Cash used in the acquisition of intangible assets		-			(200,000	)
Net Cash Used In Investing Activities		(199,322	)		(587,449	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Cash paid from loan receivable		(500,000	)		-
Proceeds from stock receivable		-			100,000
Proceeds from loan payable		2,140,000			508,333
Repayments of loan payable		-			(50,000	)
Proceeds from loan payable - related party		-			78,726
Repayments of loan payable - related party		-			(8,705	)
Common stock issued for cash		2,018,000			2,633,001
Net Cash Provided By Financing Activities		3,658,000			3,261,355

NET INCREASE IN CASH		244,449			348,562

CASH AT BEGINNING OF PERIOD		266,869			5,249

CASH AT END OF PERIOD	$	511,318		$	353,811

Supplemental cash flow information:

NON-CASH INVESTING AND FINANCING ACTIVITIES
Warrants issued in conjunction with - business combination	$	7,398,191		$	-
Common stock and contingent consideration - business combination	$	-		$	5,944,827
Issuance of common stock and warrants for cancellation of debt	$	-		$	106,193
Issuance of common stock for conversion of interest and penalties		69,270			-
Lease liability recognized from right of use asset	$	582,065		$	266,869
Settlement of related party AP for related party debt	$	30,000		$	-
Issuance of common stock and warrants for settlement of AP	$	94,000		$	-
Debt discount on conversion feature	$	-		$	295,575
Settlement expense	$	605,394		$	-

4See accompanying notes to the condensed consolidated financial statements.

~~DRIVEN DELIVERIES, INC.~~4

~~NOTES TO~~DRIVEN ~~CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~DELIVERIES, INC.

~~JUNE 30,~~NOTES ~~2020~~TO ~~AND~~CONDENSED CONSOLIDATED ~~2019~~FINANCIAL STATEMENTS

~~(Unaudited)~~SEPTEMBER 30, 2020 AND 2019

~~NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS~~(Unaudited)

~~Overview~~NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS

~~Driven Deliveries Inc. (formerly Results-Based Outsourcing Inc) (the “Company” or “Driven”), formed on July 22, 2013, is engaged in selling legal cannabis products to consumers in California.~~Overview

~~On August 29, 2018,~~ Driven Deliveries, Inc., ~~a Nevada company~~ (~~“Driven~~formerly ~~Nevada”), was acquired by~~ Results-Based ~~Outsourcing~~ ~~Inc. as part of a reverse merger transaction. As consideration for the merger, Results-Based~~ Outsourcing Inc.) ~~issued~~ (the ~~equity holders~~“Company” ofor “Driven”), ~~Nevada~~formed anon ~~aggregate~~July ~~of 30~~22,~~000,000~~ ~~post-split shares of their common stock. Following the merger~~2013, ~~the~~is ~~Company adopted~~engaged ~~the~~in ~~business~~selling ~~plan of Driven Nevada as a delivery company focused on deliveries for consumers of~~ legal cannabis ~~products,~~ inproducts ~~California.~~to ~~The~~consumers ~~merger was accounted for as a recapitalization of the Company, therefore the financial statements as presented~~ in ~~this report include the historical results of Driven Nevada~~California.

InOn August 29, 2018, Driven Deliveries, ~~June~~Inc., ~~2019~~a Nevada company (“Driven Nevada”), ~~the~~was ~~Company~~acquired ~~completed~~by ~~its~~Results-Based ~~acquisition~~Outsourcing Inc. as part of ~~Ganjarunner~~a reverse merger transaction. As consideration for the merger, Results-Based Outsourcing Inc. ~~and~~issued ~~Global~~the ~~Wellness,~~equity ~~LLC~~holders of Driven Nevada an aggregate of 30,000,000 ~~which~~post-split ~~are~~shares ~~engaged~~of intheir common stock. Following the merger, the Company adopted the business plan of ~~selling~~Driven ~~legal~~Nevada as ~~cannabis~~a ~~products~~delivery tocompany focused on deliveries for consumers of legal cannabis products, in California. ~~See~~The ~~Note~~merger 4was –accounted for ~~Merger~~as ~~and~~a ~~Asset~~recapitalization ~~Purchase~~of ~~Agreement~~the ~~below~~Company, ~~for more~~therefore ~~information~~the onfinancial statements as presented in this report include the ~~acquisition~~historical results of Driven Nevada.

In ~~July~~ June 2019, the Company ~~entered~~completed ~~into~~its acquisition anof ~~Asset~~Ganjarunner, ~~Purchase~~Inc. ~~Agreement~~and ~~with~~Global ~~Mountain High Recreation~~Wellness, ~~Inc.~~LLC, in which are engaged in the ~~Company~~business ~~acquired certain~~of ~~limited~~selling ~~assets~~legal ~~from~~cannabis ~~Mountain~~products to ~~High~~consumers ~~Recreation,~~in ~~Inc~~California. See Note 4 – Merger and Asset Purchase Agreement below for more information on the ~~asset purchase~~acquisition.

In ~~September~~ July 2019, the Company entered into an aAsset ~~Joint~~Purchase ~~Venture~~Agreement ~~agreement~~ with ~~Budee~~Mountain High Recreation, Inc., ~~to expand our operations and engaged~~ in which the ~~business~~ ofCompany ~~providing~~acquired ~~delivery~~certain ~~services~~limited ofassets ~~legal~~from ~~cannabis~~Mountain High ~~products~~Recreation, ~~to the consumer in California~~Inc. See Note 54 – ~~Joint~~Merger ~~Venture~~ and Asset Purchase Agreement for more information on the ~~Joint~~asset ~~Venture~~purchase.

~~On February~~In ~~27,~~September ~~2020,~~2019 the Company entered into ana ~~Agreement~~Joint ~~and~~Venture ~~Plan~~agreement ofwith ~~Merger~~Budee, byInc. ~~and~~to ~~among~~expand ~~the~~our ~~Company,~~operations ~~Budee~~and ~~Acquisition,~~engaged ~~Inc., a~~in ~~Nevada~~the ~~corporation~~business ~~and~~of ~~Budee,~~providing ~~Inc.,~~delivery aservices of ~~California~~legal ~~corporation,~~cannabis ~~pursuant~~products to ~~which~~ the ~~Company~~consumer ~~acquired~~in ~~Budee~~California. See Note 45 – ~~Merger~~ ~~and~~Joint ~~Asset~~Venture ~~Purchase Agreement~~ for more information on the ~~acquisition~~Joint Venture.

On ~~April~~ 9February 27, 2020, ~~our~~the ~~common~~Company ~~stock~~entered into ~~became~~an ~~quoted~~Agreement onand Plan of Merger by and among the ~~OTCQB~~Company, ~~under~~Budee Acquisition, Inc., a Nevada corporation and Budee, Inc., a California corporation, pursuant to which the ~~symbol~~Company ~~DRVD~~acquired Budee. See Note 4 – Merger and Asset Purchase Agreement for more information on the acquisition.

5On April 9, 2020 our common stock became quoted on the OTCQB under the symbol DRVD.

Risks and Uncertainties

The Company’s business and operations are sensitive to general business and economic conditions in the U.S. along with local, state, and federal governmental policy decisions. A host of factors beyond the Company’s control could cause fluctuations in these conditions. Adverse conditions may include: changes in the cannabis regulatory environment and competition from larger more well-funded companies. These adverse conditions could affect the Company’s financial condition and the results of its operations.

In December 2019, a novel strain of coronavirus, COVID-19, surfaced in Wuhan, China. This virus continues to spread around the world, resulting in business and social disruption. The coronavirus was declared a Public Health Emergency of International Concern by the World Health Organization on January 30, 2020. The operations and business results of the Company could be materially adversely affected as a result of the pandemic. Employers are also required to prepare for and increase, by as much capacity as possible, the arrangement for employees to work remotely. The extent to which the coronavirus may impact business activity or results of operations will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the coronavirus and the actions required to contain the coronavirus or treat its impact, among others.

~~NOTE 2 – GOING CONCERN ANALYSIS~~5

~~Going Concern~~NOTE ~~Analysis~~2 – GOING CONCERN ANALYSIS

~~The~~Going ~~accompanying~~Concern condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.Analysis

~~For~~The ~~the~~accompanying ~~six~~condensed ~~months~~consolidated financial ~~ended~~statements ~~June~~have ~~30,~~been ~~2020,~~prepared assuming that the Company ~~had~~will acontinue ~~net~~as ~~loss~~a ofgoing $7concern,~~466,991~~ ~~and~~which ~~working~~contemplates ~~capital deficit~~ continuity of ~~$11~~operations,~~507,823.~~ ~~The~~realization ~~Company~~of ~~will~~assets, ~~require~~and ~~additional~~liquidation ~~capital~~of ~~in order~~liabilities ~~to continue its operations~~ in the normal course of business.

~~Management’s~~For ~~plans include raising capital through~~ the ~~sale~~nine ofmonths ~~debt~~ended ~~and/or~~September ~~equity.~~30, ~~The~~2020, ~~Company’s ability to continue as a going concern is dependent upon its ability to raise capital to implement~~ the ~~business~~Company ~~plan, generate sufficient revenues and to control operating expenses. While~~had wea ~~believe~~net inloss ~~the viability~~ of ~~our strategy to generate sufficient revenue~~$14,769,492 ~~control costs~~ and ~~the~~working ~~ability~~capital todeficit ~~raise~~of ~~additional funds~~($13, ~~there can be no assurances that our strategy will be successful~~045,455). The Company’s ~~financial~~will ~~statements~~require doadditional ~~not~~capital ~~include~~in ~~any~~order ~~adjustments~~ to continue ~~reflect~~its ~~the~~operations ~~possible~~in ~~future effects on~~ the ~~recoverability~~normal ~~and~~course ~~classification~~ of ~~assets or the amounts and classification of liabilities that may result from the matters discussed herein~~business.

Management’s ~~has~~plans ~~concluded~~include ~~that~~raising capital ~~due~~through tothe ~~these conditions,~~sale ~~there~~of isdebt ~~substantial~~and/or ~~doubt~~equity. ~~about~~The ~~the~~ Company’s ability to continue as a going concern is dependent upon its ability to raise capital to implement the business plan, generate sufficient revenues and to control operating expenses. ~~The~~While we ~~accompanying~~believe ~~condensed~~in the viability of our strategy to generate sufficient revenue, control costs and the ability to raise additional ~~consolidated~~funds, there can be no assurances that our strategy will be successful. The Company’s financial statements ~~have~~do ~~been~~not ~~prepared~~include any ~~assuming~~adjustments ~~that~~to reflect the ~~Company~~possible ~~will~~future ~~continue~~effects ason athe ~~going~~recoverability ~~concern~~and ~~for~~classification ~~one~~of ~~year~~assets ~~from~~ or the ~~issuance~~amounts and classification of ~~these~~liabilities ~~financial~~that ~~statements~~may result from the matters discussed herein.

6Management has concluded that due to these conditions, there is substantial doubt about the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern for one year from the issuance of these financial statements.

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. In the opinion of the Company’s management, the accompanying condensed consolidated financial statements reflect all adjustments, consisting of normal, recurring adjustments, considered necessary for a fair presentation of the results for the interim period ended ~~June~~ September 30, 2020. Although management believes that the disclosures in these unaudited condensed consolidated financial statements are adequate to make the information presented not misleading, certain information and footnote disclosures normally included in financial statements that have been prepared in accordance U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s financial statements for the year ended December 31, 2019, which contains the audited financial statements and notes thereto, for the year ended December 31, 2019 included within the Company’s Form 10-K filed with the SEC on May 22, 2020. The interim results for the ~~six~~nine months ended ~~June~~September 30, 2020 are not necessarily indicative of the results to be expected for the year ended December 31, 2020 or for any future interim periods. The December 31, 2019 Balance Sheet is derived from the Company’s audited financial statements but does not include all necessary disclosures for full U.S. GAAP presentation.

~~Principles of consolidation~~6

~~The consolidated~~Principles ~~condensed financial statements include the accounts~~ of Driven Deliveries, Inc., and its wholly-owned subsidiaries, Budee, Inc., Ganjarunner, Inc. and Global Wellness, LLC. All significant intercompany balances and transactions have been eliminated in the consolidated condensed financial statements.consolidation

~~Use~~The consolidated condensed financial statements include the accounts of ~~estimates~~Driven Deliveries, Inc., and its wholly-owned subsidiaries, Budee, Inc., Ganjarunner, Inc. and Global Wellness, LLC. All intercompany balances and transactions have been eliminated in the consolidated condensed financial statements.

~~The preparation~~Use of ~~financial statements in conformity with U.S. GAAP requires management to make~~ estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates.

~~Coronavirus~~The ~~Aid,~~preparation ~~Relief~~of financial statements in conformity with U.S. GAAP requires management to make estimates and ~~Economic~~assumptions that affect the reported amounts of assets ~~Security~~and ~~Act~~liabilities ~~(“CARES~~and ~~Act”)~~disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates.

~~In response to the COVID-19 pandemic, the~~ Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law in March 2020. The CARES Act lifts certain deduction limitations originally imposed by the Tax Cuts and Jobs Act of 2017 (“2017 Tax Act”). Corporate taxpayers may carryback net operating losses (NOLs) originating between 2018 and 2020 for up to five years, which was not previously allowed under the 2017 Tax Act. The CARES Act also eliminates the 80% of taxable income limitations by allowing corporate entities to fully utilize NOL carryforwards to offset taxable income in 2018, 2019 or 2020. Taxpayers may generally deduct interest up to the sum of 50% of adjusted taxable income plus business interest income (30% limit under the 2017 Tax Act) for 2019 and 2020. The CARES Act allows taxpayers with alternative minimum tax credits to claim a refund in 2020 for the entire amount of the credits instead of recovering the credits through refunds over a period of years, as originally enacted by the 2017 Tax Act.

In response to the COVID-19 pandemic, ~~addition~~the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law in March 2020. The CARES Act lifts certain deduction limitations originally imposed by the Tax Cuts and Jobs Act of 2017 (“2017 Tax Act”). Corporate taxpayers may carryback net operating losses (NOLs) originating between 2018 and 2020 for up to five years, which was not previously allowed under the 2017 Tax Act. The CARES Act ~~raises~~also eliminates the 80% of taxable income limitations by allowing corporate ~~charitable~~entities to ~~deduction~~fully ~~limit~~utilize NOL carryforwards to 25offset taxable income in 2018, 2019 or 2020. Taxpayers may generally deduct interest up to the sum of 50% of adjusted taxable income ~~and~~plus ~~makes~~business ~~qualified~~interest ~~improvement~~income (30% limit under the 2017 Tax Act) for 2019 and 2020. ~~property~~The ~~generally~~CARES ~~eligible~~Act allows taxpayers with alternative minimum tax credits to claim a refund in 2020 for ~~15-year~~the ~~cost-recovery~~entire ~~and~~amount ~~100%~~of ~~bonus~~the ~~depreciation~~credits instead of recovering the credits through refunds over a period of years, as originally enacted by the 2017 Tax Act.

~~Concentrations~~In addition, the CARES Act raises the corporate charitable deduction limit to 25% of taxable income and makes qualified improvement property generally eligible for 15-year cost-recovery and 100% bonus depreciation.

The Company maintains its cash accounts at financial institutions which are insured by the Federal Deposit Insurance Corporation. At times, the Company may have deposits in excess of federally insured limits.Concentrations

~~Cash~~The Company maintains its cash accounts ~~and~~at ~~Cash~~financial ~~Equivalents~~institutions which are insured by the Federal Deposit Insurance Corporation. At times, the Company may have deposits in excess of federally insured limits.

~~The Company~~Cash ~~considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. As of June 30, 2020~~ and ~~December~~Cash ~~31, 2019, the Company did not have any cash equivalents.~~Equivalents

7The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. As of September 30, 2020 and December 31, 2019, the Company did not have any cash equivalents.

Inventory

Inventory consists of finished goods and ~~applicable~~ applicable capitalized costs and is stated at the lower of cost or net realizable value, on an average cost basis. Inventory is ~~determined~~ determined to be salable based on demand forecast within a specific time horizon. Inventory in excess of salable amounts is considered obsolete, at which point it is written down to its net realizable value.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company generally does not require collateral to support customer receivables. The Company determines if receivables are past due based on days outstanding, and amounts are written off when determined to be uncollectible by management. ~~The~~As ~~Company~~of ~~does~~September ~~not~~30, ~~record~~2020 anand 2019, there was no allowance for ~~doubtful~~ doubtful accounts deemed necessary.

~~Goodwill~~ 7

We review goodwill for impairment at least annually or more frequently if events or changes in circumstances would more likely than not reduce the fair value of our single reporting unit below its carrying value. As of June 30, 2020, no impairment of goodwill has been identified.Goodwill

	Goodwill
Balance, January 1, 2019	$	-
Additions		1,271,718
Balance, December 31, 2019		1,271,718
Additions		549,281
Balance, June 30, 2020	$	1,820,999

We review goodwill for impairment at least annually or more frequently if events or changes in circumstances would more likely than not reduce the fair value of our single reporting unit below its carrying value. As of September 30, 2020, no impairment of goodwill has been identified.

Intangible Assets

	Goodwill
Balance, January 1, 2019	$	-
Additions		1,271,718
Balance, December 31, 2019		1,271,718
Additions		549,281
Balance, September 30, 2020	$	1,820,999

~~The Company’s~~Intangible ~~intangible assets include the following at June 30, 2020:~~Assets

	Cost Basis		Accumulated Amortization			Net at 6/30/2020		Estimated Life
Trade Names/Trademarks	$	4,440,962	$	(276,688	)	$	4,164,274		10
IP/Trade Secrets		3,053,060		(465,921	)		2,587,139		5
License		1,064,684		(110,591	)		954,093		15
Proprietary Software/Technology		4,189,000		(203,302	)		3,985,698		7
Non-Compete Agreements		536,009		(183,752	)		352,257		2
Customer Relations		211,000		(24,994	)		186,006		7
Total Intangible Assets	$	13,494,715		(1,265,248	)	$	12,229,467

The Company’s intangible assets include the following at September 30, 2020:

The Company’s intangible assets include the following at December 31, 2019:

	Cost Basis		Accumulated Amortization			Net		Estimated Life
Trade Names/Trademarks	$	4,440,962	$	(388,625	)	$	4,052,337		10
IP/Trade Secrets		3,053,060		(619,828	)		2,433,232		5
License		1,064,684		(170,642	)		894,042		15
Proprietary Software/Technology		4,189,000		(354,139	)		3,834,861		7
Non-Compete Agreements		536,009		(251,304	)		284,705		2
Customer Relations		211,000		(32,592	)		178,408		7
Total Intangible Assets	$	13,494,715		(1,817,130	)	$	11,677,585

	Cost Basis		Accumulated Amortization			Net at 12/31/2019		Estimated Life
Trade Names/Trademarks	$	1,918,962	$	(95,324	)	$	1,823,638		10
IP/Trade Secrets		1,978,060		(195,616	)		1,782,444		5
License		678,684		(22,463	)		656,221		15
Proprietary Software/Technology		289,009		(69,742	)		219,267		7
Customer Relations		152,000		(11,303	)		140,697		7
Total Intangible Assets	$	5,016,715	$	(394,448	)	$	4,622,267

The Company’s intangible assets include the following at December 31, 2019:

There was no impairment recorded to intangible assets as of June 30, 2020. Amortization expense was $870,800 and $0 for the six months ended June 30, 2020 and June 30, 2019, respectively. Amortization expense was $529,217 and $0 for the three months ended June 30, 2020 and June 30, 2019, respectively.

	Cost Basis		Accumulated Amortization			Net		Estimated Life
Trade Names/Trademarks	$	1,918,962	$	(95,324	)	$	1,823,638		10
IP/Trade Secrets		1,978,060		(195,616	)		1,782,444		5
License		678,684		(22,463	)		656,221		15
Proprietary Software/Technology		289,009		(69,742	)		219,267		7
Customer Relations		152,000		(11,303	)		140,697		7
Total Intangible Assets	$	5,016,715	$	(394,448	)	$	4,622,267

8There was no impairment recorded to intangible assets as of September 30, 2020. Amortization expense was $1,422,682 and $0 for the nine months ended September 30, 2020 and September 30, 2019, respectively. Amortization expense was $551,881 and $0 for the three months ended September 30, 2020 and September 30, 2019, respectively.

The future amortization expense intangible assets are as follows:

2020 (remainder)	$	~~705~~551,~~371~~881
2021		2,119,392
2022		1,814,416
2023		1,728,525
2024		1,535,478
2025 and after		43,~~326~~927,~~285~~893
Total	$	1211,~~229~~677,~~467~~585

~~Cost of Sales~~8

Cost of ~~sales consists of:~~Sales

~~Product costs:~~Cost ~~Product costs include the purchase price~~ of ~~products~~sales ~~sold,~~consists ~~which include direct and indirect labor costs, rent, and depreciation expenses, and inbound shipping and handling costs for inventory.~~of:

~~Fulfillment~~ Product costs: ~~and~~Product ~~other:~~costs ~~includes~~include the purchase ~~costs~~price of ~~outbound shipping and handling and other costs related to delivering~~ products ~~to the customer~~sold.

~~The~~Fulfillment costs and other: includes ~~Company’s~~the ~~cost~~costs of ~~sales~~outbound ~~for~~shipping ~~June~~and 30handling and other costs which include direct and indirect labor costs, ~~2020~~rent, and ~~2019~~depreciation expenses, ~~are~~and asinbound ~~follows:~~shipping and handling costs for inventory related to delivering products to the customer.

Cost of Sales Type	Six months ended June 30, 2020		Six months ended June 30, 2019
Cost of Sales – Product Costs	$	3,597,269	$	29,700
Cost of Sales – Fulfilment Costs and Other		3,853,186		18,694
Total	$	7,450,455	$	48,394

The Company’s cost of sales for September 30, 2020 and 2019 are as follows:

Advertising

Cost of Sales Type	Nine months ended September 30, 2020		Nine months ended September 30, 2019
Cost of Sales – Product Costs	$	6,195,462	$	458,239
Cost of Sales – Fulfilment Costs and Other		9,225,191		145,930
Total	$	15,420,653	$	604,169

~~The Company expenses the cost of advertising and promotions as incurred.~~ Advertising expense was $320,152 and $93,277 for the six months ended June 30, 2020 and 2019, respectively. Advertising expense was $140,072 and $52,503 for the three months ended June 30, 2020 and 2019, respectively.

~~Stock-Based~~The Company expenses ~~Compensation~~the cost of advertising and promotions as incurred. Advertising expense was $817,103 and $227,419 for the nine months ended September 30, 2020 and 2019, respectively. Advertising expense was $355,733 and $134,142 for the three months ended September 30, 2020 and 2019, respectively.

~~The Company accounts for stock-based compensation costs under the provisions of ASC 718, “Compensation–~~Stock ~~Compensation”, which requires the measurement and recognition of compensation expense related to the fair value of stock~~-based compensation awards that are ultimately expected to vest. Stock based compensation expense recognized includes the compensation cost for all stock-based payments granted to employees, officers, and directors based on the grant date fair value estimated in accordance with the provisions of ASC 718. ASC 718 is also applied to awards modified, repurchased, or cancelled during the periods reported. The Company accounts for warrants and options issued to non-employees under ASU 2018-07, Equity – Equity Based ~~Payments to Non-Employees, using the Black-Scholes option-pricing model.~~Compensation

The ~~Black–Scholes~~ ~~option~~Company ~~valuation~~accounts ~~model~~for ~~requires~~stock-based compensation costs under the ~~development~~provisions of ~~assumptions~~ASC ~~that~~718, ~~are~~“Compensation–Stock ~~inputs~~Compensation”, ~~into~~which requires the ~~model.~~measurement ~~These assumptions~~and ~~are~~recognition ~~the value~~ of ~~the~~compensation ~~underlying~~expense ~~share,~~related to the ~~expected~~fair ~~stock~~value ~~volatility,~~of ~~the~~stock-based ~~risk–free~~compensation ~~interest~~awards ~~rate,~~that ~~the~~are ultimately expected ~~life of~~to ~~the~~vest. ~~option,~~Stock-based ~~the~~compensation ~~dividend~~expense ~~yield~~recognized onincludes the ~~underlying~~compensation ~~stock~~cost ~~and are accounted~~ for asall ~~they~~stock-based ~~occur.~~payments ~~Due~~granted to ~~the~~employees, officers, ~~lack~~and ofdirectors ~~sufficient~~based ~~trading history,~~on the ~~Company~~grant ~~benchmarked~~date ~~their~~fair ~~volatility~~value toestimated ~~similar companies~~ in aaccordance ~~similar~~with ~~industry over~~ the ~~expected~~provisions ~~option~~of ~~life~~ASC ~~and other appropriate factors~~718. ~~Risk–free~~ASC ~~interest~~718 ~~rates~~is ~~are~~also applied ~~calculated~~to ~~based~~awards onmodified, ~~continuously~~repurchased, ~~compounded~~or ~~risk–free~~cancelled ~~rates for~~during the ~~appropriate~~periods ~~term~~reported. The ~~dividend yield is assumed to be zero as the~~ Company ~~has~~accounts ~~never~~for ~~paid~~warrants orand ~~declared~~options issued ~~any~~to ~~cash~~non-employees ~~dividends on~~under ~~its~~ASU ~~Common~~2018-07, ~~stock~~Equity ~~and~~– ~~does~~Equity ~~not~~Based ~~intend~~Payments to ~~pay~~Non-Employees, ~~dividends~~using ~~on its Common stock in~~ the ~~foreseeable~~Black-Scholes ~~future. The Company records forfeitures~~option-pricing ~~as they occur~~model.

The ~~Company’s~~Black–Scholes option valuation model requires the development of assumptions that are inputs into the model. These assumptions are the value of the underlying share, the expected stock ~~based~~volatility, ~~compensation~~the ~~expense~~risk–free ~~was~~interest $1rate,~~080~~ the expected life of the option,~~701~~ the dividend yield on the underlying stock and ~~$971,633~~are accounted for as they occur. Due to the ~~six~~lack ~~months~~of ~~ended~~sufficient ~~June~~trading 30history, ~~2020~~the Company benchmarked their volatility to similar companies in a similar industry over the expected option life and ~~2019,~~other ~~respectively~~appropriate factors. Risk–free interest rates are calculated based on continuously compounded risk–free rates for the appropriate term. The dividend yield is assumed to be zero as the Company’s ~~stock~~has ~~based~~never ~~compensation~~paid ~~expense~~or ~~was~~declared ~~$752,897~~any cash dividends on its Common stock and ~~$623,939~~does ~~for~~not intend to pay dividends on its Common stock in the ~~three~~foreseeable ~~months~~future. ~~ended~~The ~~June~~Company ~~30,~~records ~~2020~~forfeitures ~~and~~as ~~2019,~~they ~~respectively~~occur.

9The Company’s stock-based compensation expense was $3,022,063 and $5,979,629 for the nine months ended September 30, 2020 and 2019, respectively. The Company’s stock-based compensation expense was $1,941,362 and $5,007,996 for the three months ended September 30, 2020 and 2019, respectively.

Fair Value Measurements

ASC 820, “Fair Value Measurements and Disclosure,” defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 also establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels giving the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).

~~The three levels are described below:~~9

~~Level 1~~The ~~Inputs~~three –levels ~~Unadjusted~~are ~~quoted~~described ~~prices in active markets for identical assets or liabilities that is accessible by the Company;~~below:

Level 2 1 Inputs – ~~Quoted~~Unadjusted quoted prices in ~~markets that are not~~ active ormarkets ~~financial instruments~~ for ~~which~~identical ~~all~~assets ~~significant~~or ~~inputs~~liabilities ~~are~~that ~~observable, either~~is ~~directly~~accessible orby ~~indirectly~~the Company;

Level 3 2 Inputs – ~~Unobservable~~Quoted prices ~~inputs~~in ~~for~~markets ~~the~~that ~~asset~~are not active or ~~liability~~financial ~~including~~instruments ~~significant~~for ~~assumptions~~which ofall ~~the~~significant ~~Company~~inputs ~~and~~are ~~other~~observable, ~~market~~either directly ~~participants.~~or indirectly;

~~The carrying~~Level ~~amount~~3 ofInputs ~~the~~– ~~Company’s financial assets and liabilities, such as cash, accounts payable, accounts receivables,~~Unobservable ~~and~~inputs ~~accrued~~for ~~expenses~~the ~~approximate~~asset ~~their~~or ~~fair~~liability ~~value~~including ~~because~~significant ofassumptions ~~the short maturity~~ of ~~those instruments. Non- recurring fair value items are re-assessed at~~ the ~~end~~Company ofand ~~each~~other ~~reporting~~market ~~period~~participants.

The ~~assets~~ orcarrying ~~liability’s~~amount ~~fair~~of ~~value measurement within~~ the ~~fair~~Company’s financial ~~value~~assets ~~hierarchy~~and isliabilities, ~~based~~such ~~upon~~as ~~the~~cash, ~~lowest~~accounts ~~level~~payable, ofaccounts ~~any~~receivables, ~~input that~~and isaccrued ~~significant~~expenses toapproximate ~~the~~ their fair value ~~measurement.~~because ~~The~~of ~~following~~the ~~table~~short ~~provides~~maturity ~~a summary~~ of ~~financial~~those instruments. ~~that~~Non- ~~are~~recurring ~~measured at~~ fair value asitems ofare ~~June~~re-assessed ~~30,~~at ~~2020~~the end of each reporting period.

	Carrying			Fair Value Measurement Using
	Value			Level 1		Level 2		Level 3			Total
Derivative liabilities	$	(872,399	)	$	-	$	-	$	(872,399	)	$	(872,399	)

The assets or liability’s fair value measurement within the fair value hierarchy is based upon the lowest level of any input that is significant to the fair value measurement. The following table provides a summary of financial instruments that are measured at fair value as of September 30, 2020.

The following table provides a summary of financial instruments that are measured at fair value as of December 31, 2019.

	Carrying			Fair Value Measurement Using
	Value			Level 1		Level 2		Level 3			Total

Derivative liabilities	$	(178,108	)	$	-	$	-	$	(178,108	)	$	(178,108	)

	Carrying			Fair Value Measurement Using
	Value			Level 1		Level 2		Level 3			Total
Derivative liabilities	$	(306,762	)	$	-	$	-	$	(306,762	)	$	(306,762	)

The following table provides a summary of financial instruments that are measured at fair value as of December 31, 2019.

The table below provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the six months ended June 30, 2020:

	Carrying			Fair Value Measurement Using
	Value			Level 1		Level 2		Level 3			Total

Derivative liabilities	$	(306,762	)	$	-	$	-	$	(306,762	)	$	(306,762	)

	Fair Value Measurement Using Level 3
	Inputs Total
Balance, January 1, 2019	$	-
Debt Discount		305,424
Change in fair value of derivative liabilities		(1,338	)
Balance, December 31, 2019		306,762
Extinguishment		(311,360	)
Debt Discount		528,603
Change in fair value of derivative liabilities		348,394
Balance, June 30, 2020	$	872,399

	Fair Value Measurement Using Level 3
	Inputs Total
Balance, January 1, 2019	$	-
Debt Discount		305,424
Change in fair value of derivative liabilities		1,338
Balance, December 31, 2019		306,762
Extinguishment		(311,360	)
Debt Discount		528,603
Change in fair value of derivative liabilities		(345,897	)
Balance, September 30, 2020	$	178,108

The level 3 financial instruments consist of embedded conversion features. The fair value of these embedded conversion features are estimated using a Black Scholes valuation model. The fair value of the derivative features were calculated using a Black-Scholes option model valued with the following assumptions:10

	June 30, 2020			December 31, 2019
Exercise price	$	0.50		$	0.50
Risk free interest rate		0.16-1.12	%		1.52-1.81	%
Dividend yield		0.00	%		0.00	%
Expected volatility		97-157	%		93-109	%
Contractual term		0.63-1.19 Years			0.91-1.37
Estimated fair value of stock on grant date	$	0.50-0.63		$	0.50

Risk-free interest rate: The Company uses the risk-free interest rate of a U.S. Treasury Note with a similar expected term on the date of measurement.

	September 30, 2020			December 31, 2019
Exercise price	$	0.50		$	0.50
Risk free interest rate		0.16-1.12	%		1.52-1.81	%
Dividend yield		0.00	%		0.00	%
Expected volatility		97-157	%		93-109	%
Contractual term (Years)		0.38-1.19			0.91-1.37
Fair value of stock on grant date		$0.50-0.63		$	0.50

~~Dividend yield~~Risk-free interest rate: The Company uses ~~a 0% expected dividend yield as~~ the ~~Company~~risk-free ~~has~~interest ~~not~~rate ~~paid~~of ~~dividends~~a toU.S. ~~date~~Treasury ~~and~~Note ~~does~~with ~~not~~a ~~anticipate~~similar ~~declaring dividends~~expected interm on the ~~near~~date ~~future~~of measurement.

~~Volatility~~Dividend yield: The Company ~~calculates~~uses ~~the~~a 0% expected ~~volatility~~dividend ofyield ~~the~~as ~~stock price based on~~ the ~~corresponding~~Company ~~volatility~~has ofnot ~~the~~paid ~~Company’s peer~~dividends ~~group~~to ~~stock~~date ~~price~~and ~~for~~does anot ~~period~~anticipate ~~consistent~~declaring ~~with~~dividends in the ~~warrants’ expected term~~near future.

~~Expected term~~Volatility: The Company’s calculates the expected ~~term~~volatility isof the stock price based on the ~~remaining~~corresponding ~~contractual~~volatility ~~maturity~~ of the Company’s peer group stock price for a period consistent with the warrants’ expected term.

~~Changes in~~Expected ~~the~~term: ~~unobservable~~The ~~input~~Company’s ~~values~~expected term ~~would~~is ~~likely~~based ~~cause~~on ~~material changes in~~ the ~~fair~~remaining ~~value~~contractual maturity of the ~~Company’s Level 3 financial instruments~~warrants.

~~The most~~Changes ~~sensitive~~in ~~unobserved~~the ~~inputs~~unobservable ~~used~~input invalues would ~~valuing~~likely ~~derivative~~cause ~~instruments~~material ~~are~~changes ~~volatility~~in ~~and~~the ~~estimated~~ fair value of the Company’s ~~stock~~ onLevel ~~the~~3 ~~grant~~financial ~~date of the~~ instruments. ~~Significant changes in either of these inputs could have a material effect on the fair value measurement of the derivative instruments.~~

~~During the~~The ~~six~~most ~~months~~sensitive ~~ended~~unobserved ~~June~~inputs ~~30,~~used in ~~2020~~valuing derivative instruments are volatility and ~~2019,~~estimated fair value of the Company’s ~~marked~~stock on the ~~derivative~~grant ~~feature~~date of the instruments. ~~warrants~~Significant tochanges ~~fair~~in ~~value~~either ~~and~~of ~~recorded a~~these ~~loss~~inputs ofcould ~~$348,394~~have ~~and~~a $0material ~~relating~~effect toon the ~~change in~~ fair value, ~~respectively~~measurement of the derivative instruments.

~~Derivative~~During the nine months ended September ~~Liability~~30, 2020 and 2019, the Company marked the derivative feature of the warrants to fair value and recorded a gain of $345,897 and a loss of $807,250 relating to the change in fair value, respectively.

~~The Company~~During ~~evaluates~~the ~~its~~three ~~options,~~months ~~warrants~~ended ~~or other contracts~~September 30, if2020 ~~any, to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-10-05-4~~ and ~~815-40-25.~~2019, ~~The~~the ~~result of~~Company ~~this~~marked ~~accounting treatment is that~~ the ~~fair~~derivative ~~value~~feature of the ~~embedded~~warrants ~~derivative is marked-~~to~~-market~~ ~~each balance sheet date and recorded as either an asset or a liability. In the event that the~~ fair value isand recorded as a ~~liability,~~gain ~~the change in fair value is recorded in the consolidated condensed statement~~ of ~~operations as other income or expense. Upon conversion~~$694,291 ~~exercise or cancellation~~and of a ~~derivative~~loss ~~instrument, the instrument is marked to fair value at the date~~ of ~~conversion~~$807,250 ~~exercise~~relating orto ~~cancellation and then~~ the ~~related~~change in fair value, ~~is reclassified to equity or to gain or loss on extinguishment of the note if the derivative is attached to a note~~respectively.

11Derivative Liability

The ~~classification~~ ofCompany ~~derivative~~evaluates ~~instruments~~its options, ~~including~~warrants or ~~whether~~other ~~such~~contracts, ~~instruments~~if ~~should~~any, beto ~~recorded~~determine asif ~~liabilities~~those contracts or asembedded ~~equity,~~components ~~is re-assessed~~of atthose ~~the~~contracts ~~end~~qualify ofas ~~each~~derivatives ~~reporting~~to be ~~period.~~separately ~~Equity~~accounted ~~instruments~~for ~~that~~in ~~are~~accordance ~~initially~~with ~~classified~~ASC as815-10-05-4 ~~equity~~and ~~that~~815-40-25. ~~become~~The ~~subject to~~result ~~reclassification~~of ~~are~~this ~~reclassified~~accounting totreatment ~~liability~~is at that the fair value of the ~~instrument~~embedded onderivative ~~the~~is ~~reclassification~~marked-to-market each balance sheet date. ~~Derivative instrument~~and ~~liabilities~~recorded ~~will~~as beeither ~~classified~~an inasset ~~the~~or ~~balance~~a ~~sheet~~liability. In asthe ~~current~~event orthat ~~non-current~~the ~~based~~fair onvalue ~~whether~~is orrecorded ~~not~~as ~~net-cash~~a ~~settlement of~~liability, the ~~derivative~~change ~~instrument~~in fair value is ~~expected~~recorded ~~within~~in 12the ~~months~~consolidated condensed statement of ~~the~~operations ~~balance~~as ~~sheet~~other ~~date.~~income ~~The~~or ~~pricing~~expense. ~~model~~Upon ~~includes~~conversion, ~~subjective~~exercise ~~input assumptions~~or ~~that~~cancellation ~~can~~of ~~materially~~a ~~affect~~derivative instrument, the instrument is marked to fair value ~~estimates.~~at ~~The~~the ~~expected~~date ~~volatility~~of isconversion, ~~estimated~~exercise ~~based~~or oncancellation ~~the~~and ~~most~~then ~~recent historical~~the ~~period~~related offair ~~time~~value ofis ~~comparable~~reclassified to ~~companies~~equity ~~equal~~or to ~~the~~gain ~~remaining~~or ~~contractual~~loss ~~term~~on extinguishment of the ~~instrument~~note ~~granted~~if the derivative is attached to a note.

~~Revenue~~The classification of derivative instruments, ~~Recognition~~including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date. The pricing model includes subjective input assumptions that can materially affect the fair value estimates. The expected volatility is estimated based on the most recent historical period of time of comparable companies equal to the remaining contractual term of the instrument granted.

As of January 1, 2018, the Company adopted ASC 606. The adoption of ASC 606 (Revenue From Contracts With Customers) represents a change in accounting principle that will more closely align revenue recognition with the delivery of the Company’s services and will provide financial statement readers with enhanced disclosures. In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. The Company used the Modified-Retrospective Method when adopting this standard. There was no accounting effect due to the initial adoption. To achieve this core principle, the Company applies the following five steps:11

1)Revenue ~~Identify the contract with a customer~~Recognition

~~The Company~~As ~~sells~~of ~~retail~~January ~~products~~1, ~~directly~~2018, tothe ~~customers~~Company adopted ASC 606. InThe ~~these~~adoption ~~sales~~of ~~there~~ASC is606 no(Revenue ~~formal~~From ~~contract~~Contracts With Customers) represents a change in accounting principle that will more closely align revenue recognition with the ~~customer.~~delivery ~~These~~of ~~sales have~~the ~~commercial~~Company’s ~~substance~~services and ~~there~~will ~~are~~provide nofinancial ~~issues~~statement readers with ~~collectability~~enhanced asdisclosures. ~~the~~In accordance with ASC 606, revenue is recognized when a customer ~~pays~~obtains ~~the~~control ~~cost~~of promised services. The amount of revenue recognized reflects the ~~goods~~consideration atto which the ~~time~~Company ofexpects to be entitled to receive in ~~purchase~~exchange orfor ~~delivery~~these services. The Company used the Modified-Retrospective Method when adopting this standard. There was no accounting effect due to the initial adoption. To achieve this core principle, the Company applies the following five steps:

21) Identify the ~~performance~~contract ~~obligations~~with ina ~~the contract~~customer

The Company sells ~~its~~retail products directly to ~~consumers~~customers. In ~~this case~~ these sales ~~represent~~there ais ~~performance~~no ~~obligation~~formal contract with the customer. These sales have commercial substance and there are ~~any~~no ~~necessary~~issues ~~deliveries~~with collectability as the customer pays the cost of ~~those~~the ~~products~~goods at the time of purchase or delivery.

32) ~~Determine~~Identify the ~~transaction~~performance ~~price~~obligations in the contract

The ~~sales~~ ~~that~~Company ~~are~~sells ~~done~~its ~~directly~~products directly to ~~the~~consumers. ~~customer~~In ~~have~~this nocase ~~variable~~these ~~consideration~~sales orrepresent ~~financing~~a ~~component.~~performance ~~The~~obligation ~~transaction~~with ~~price is~~ the ~~cost~~ ~~that~~sales ~~those~~and ~~goods are being sold for plus~~ any ~~additional~~necessary ~~delivery~~deliveries ~~costs~~of those products.

43) ~~Allocate~~Determine the transaction price ~~to performance obligations in the contract~~

~~For the~~The ~~goods~~sales that ~~the~~are ~~Company~~done ~~sells~~ directly to ~~customers,~~ the customer ~~transaction~~have ~~price~~no isvariable ~~allocated~~consideration ~~between~~or ~~the~~financing ~~cost~~component. ofThe ~~the~~transaction ~~goods~~price ~~and~~is ~~any delivery~~the ~~fees~~cost that ~~may~~those begoods ~~incurred~~are tobeing ~~deliver~~sold for toplus ~~the~~any ~~customer~~additional delivery costs.

124) Allocate the transaction price to performance obligations in the contract

5)For ~~Recognize~~the ~~revenue~~goods ~~when~~that orthe asCompany sells directly to customers, the ~~Company~~transaction ~~satisfies~~price ais ~~performance~~allocated ~~obligation~~between the cost of the goods and any delivery fees that may be incurred to deliver to the customer.

~~For the~~5) ~~sales~~Recognize ofrevenue ~~the~~when ~~Company’s~~or ~~own~~as ~~goods~~ the ~~performance~~Company ~~obligation~~satisfies isa ~~complete~~performance ~~once the customer has received their product.~~obligation

~~Disaggregation~~ For the sales of ~~Revenue~~the Company’s own goods the performance obligation is complete once the customer has received their product.

~~The following~~Disaggregation ~~table depicts the disaggregation~~ of ~~revenue according to revenue type.~~Revenue

Revenue Type	Revenue for the three months ended June 30, 2020		Revenue for the three months ended June 30, 2019			Revenue for the six months ended June 30, 2020			Revenue for the six months ended June 30, 2019
Delivery Income	$	-	$	18,973		$	27,043		$	34,343
Dispensary Cost Reimbursements		-		(28,559	)		(7,528	)		(63,346	)
Delivery Income, net		-		(9,586	)		19,515			(29,003	)
Product Sales		5,672,305		75,410			7,848,238			75,410
Total	$	5,672,305	$	65,824		$	7,867,753		$	46,407

The following table depicts the disaggregation of revenue according to revenue type.

Revenue Type	Revenue for the three months ended September 30, 2020		Revenue for the three months ended September 30, 2019			Revenue for the nine months ended September 30, 2020			Revenue for the nine months ended September 30, 2019
Delivery Income	$	-	$	53,496		$	27,043		$	87,869
Dispensary Cost Reimbursements		-		(36,007	)		(7,528	)		(99,353	)
Delivery Income, net		-		17,489			19,515			(11,484	)
Product Sales		5,979,875		1,195,174			13,828,113			1,270,554
Total	$	5,979,875	$	1,212,663		$	13,847,628		$	1,259,070

~~Leases~~12

Under Topic 842, operating lease expense is generally recognized evenly over the term of the lease. The Company has operating leases primarily consisting of office space with remaining lease terms of 35 months to 37 months. Current facility leases include our offices in El Segundo California, Oakland California, and Sacramento California. Lease costs were $96,123 and $96,708 for the six months ended June 30, 2020 and 2019. There was no sublease rental income for the six months ended June 30, 2020 and 2019. Lease costs were $55,748 and $52,648 for the three months ended June 30, 2020 and 2019. There was no sublease rental income for the three months ended June 30, 2020 and 2019.Leases

~~Leases~~Under Topic 842, operating lease expense ~~with~~is angenerally ~~initial~~recognized evenly over the term of ~~twelve~~the ~~months~~lease. orThe ~~less~~Company ~~are~~has ~~not~~operating ~~recorded~~leases onprimarily ~~the~~consisting ~~balance~~of ~~sheet.~~office ~~For~~space with remaining lease ~~agreements~~terms ~~entered~~of ~~into~~32 ormonths ~~reassessed~~to 34 months. Current facility leases include our offices in El Segundo California, Oakland ~~after~~California, and Sacramento California. Lease costs were $239,065 and $148,021 for the ~~adoption~~nine ofmonths ~~Topic~~ended ~~842~~September 30, we2020 ~~combine~~and 2019. There was no sublease rental income for the ~~lease~~nine months ended September 30, 2020 and ~~non-lease~~2019. ~~components~~Lease incosts ~~determining~~were $142,942 and $51,313 for the ~~lease~~three ~~liabilities~~months ended September 30, 2020 and ~~right~~2019. There was no sublease rental income for the three months ended ofSeptember ~~use~~30, ~~(“ROU”)~~2020 ~~assets~~and 2019.

~~Our lease~~Leases ~~agreements~~with ~~generally do not provide~~ an ~~implicit~~initial ~~borrowing~~term ~~rate,~~of ~~therefore~~twelve months anor ~~internal~~less ~~incremental~~are ~~borrowing~~not ~~rate~~recorded ~~is determined based~~ on ~~information available at lease commencement date for purposes of determining~~ the ~~present~~balance ~~value~~sheet. ofFor lease ~~payments.~~agreements ~~We used~~entered ~~the~~into ~~incremental~~or ~~borrowing~~reassessed ~~rate~~after ~~on June 30, 2020 and December 31, 2019 for all leases that commenced prior to that date. In determining this rate, which is used to determine~~ the ~~present~~adoption ~~value~~ of ~~future lease payments~~Topic 842, we ~~estimate~~combine the ~~rate~~lease ofand ~~interest we~~non-lease ~~would~~components ~~pay~~in ondetermining ~~a collateralized basis, with similar payment terms as~~ the lease liabilities and inright aof ~~similar~~use ~~economic~~(“ROU”) ~~environment~~assets.

~~Lease~~Our lease agreements generally do not ~~Costs~~provide an implicit borrowing rate, therefore an internal incremental borrowing rate is determined based on information available at lease commencement date for purposes of determining the present value of lease payments. We used the incremental borrowing rate on September 30, 2020 and December 31, 2019 for all leases that commenced prior to that date. In determining this rate, which is used to determine the present value of future lease payments, we estimate the rate of interest we would pay on a collateralized basis, with similar payment terms as the lease and in a similar economic environment.

	Six Months Ended June 30, 2020		Six Months Ended June 30, 2019
Components of total lease costs:
Operating lease expense	$	96,123	$	96,708
Total lease costs	$	96,123	$	96,708

Lease Costs

	Nine Months Ended September 30, 2020		Nine Months Ended September 30, 2019
Components of total lease costs:
Operating lease expense	$	239,065	$	148,021
Total lease costs	$	239,065	$	148,021

Lease Positions as of ~~June~~September 30, 2020

ROU lease assets and lease liabilities for our operating leases were recorded in the consolidated condensed balance sheet as follows:

	June 30, 2020		December 31, 2019
	September 30, 2020		December 31, 2019
Assets
Right of use asset	$	~~601~~544,~~801~~032	$	115,859
Total assets	$	~~601~~544,~~801~~032	$	115,859
Liabilities
Operating lease liabilities – short term	$	~~265~~257,~~670~~772	$	40,217
Operating lease liabilities – long term		~~336~~286,~~753~~260		76,264
Total lease liability	$	~~602~~544,~~423~~032	$	116,481

Lease Terms and Discount Rate

Weighted average remaining lease term (in years) – operating lease			3.3308
Weighted average discount rate – operating lease			10.91	%

~~Cash Flows~~13

	Six Months Ended June 30, 2020			Six Months Ended June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
ROU amortization	$	96,123		$	44,823
Cash paydowns of operating liability	$	(96,123	)	$	(42,601	)
Supplemental non-cash amounts of lease liabilities arising from obtaining:
ROU asset	$	(657,549	)	$	(390,109	)
Lease Liability	$	658,171		$	369,986

Cash Flows

	Nine Months Ended September 30, 2020			Nine Months Ended September 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
ROU amortization	$	153,893		$	44,823
Cash paydowns of operating liability	$	(153,893	)	$	(42,601	)
Supplemental non-cash amounts of lease liabilities arising from obtaining:
ROU asset	$	(544,032	)	$	(390,109	)
Lease Liability	$	544,032		$	369,986

The future minimum lease payments under the leases are as follows:

2020 (remainder)	$	~~145~~72,~~038~~519
2021		250,543
2022		231,678
2023		39,178
Total future minimum lease payments		~~666~~593,~~437~~918
Less: Lease imputed interest		6449,~~014~~886
Total	$	~~602~~544,~~423~~032

Excise and Sales Tax

The State of California and various local governments impose certain excise and state and local taxes on product sales. The Company’s policy is to include excise taxes as part of sales and cost of sales. The Company’s policy for various state and local sales taxes are to exclude them from revenue and cost of sales.

Basic and Diluted Net Loss per Common Share

Basic loss per common share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding for each period. For diluted earnings per common share, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive. As of ~~June~~September 30, 2020, common stock equivalents are comprised of 2329,~~694~~628,~~750~~272 warrants and 6,~~581~~611,434 options.

Recent Accounting Pronouncements

In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350)—Simplifying the Test for Goodwill Impairment. ASU 2017-04 simplifies the accounting for goodwill impairments by eliminating the requirement to compare the implied fair value of goodwill with its carrying amount as part of step two of the goodwill impairment test referenced in Accounting Standards Codification (“ASC”) 350, Intangibles - Goodwill and Other (“ASC 350”). As a result, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value. However, the impairment loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. ASU 2017-04 is effective for annual reporting periods beginning after December 15, 2019. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement” (“ASU 2018-13”). ASU 2018-13 removes, modifies and adds certain disclosure requirements in Topic 820 “Fair Value Measurement”. ASU 2018-13 eliminates certain disclosures related to transfers and the valuations process, modifies disclosures for investments that are valued based on net asset value, clarifies the measurement uncertainty disclosure, and requires additional disclosures for Level 3 fair value measurements. ASU 2018-13 is effective for the Company for annual and interim reporting periods beginning January 1, 2020. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures.14

In ~~December~~ ~~2019~~August 2018, the FASB issued ~~authoritative~~ASU ~~guidance~~2018-13, “Fair ~~intended~~Value toMeasurement ~~simplify~~(Topic 820): Disclosure Framework—Changes to the ~~accounting~~Disclosure Requirements for ~~income~~Fair ~~taxes~~Value Measurement” (“ASU ~~2019~~2018-1213”). ASU 2018-13 removes, ~~“Income Taxes~~modifies ~~(Topic~~and ~~740):~~adds ~~Simplifying~~certain ~~the~~disclosure ~~Accounting~~requirements ~~for~~in ~~Income~~Topic ~~Taxes~~820 “Fair Value Measurement”). ~~This~~ASU ~~guidance~~2018-13 eliminates certain ~~exceptions~~disclosures related to transfers and the ~~general approach~~valuations toprocess, ~~the~~modifies ~~income~~disclosures for ~~tax~~investments ~~accounting~~that ~~model~~are ~~and~~valued ~~adds~~based ~~new~~on ~~guidance~~net toasset ~~reduce~~value, clarifies the ~~complexity~~measurement inuncertainty ~~accounting~~disclosure, and requires additional disclosures for ~~income~~Level ~~taxes~~3 fair value measurements. ~~This guidance~~ASU 2018-13 is effective for ~~fiscal~~the ~~years~~Company ~~beginning~~for ~~after~~annual ~~December~~and ~~15, 2020, including~~ interim reporting periods beginning ~~within~~January ~~those~~1, ~~annual periods~~2020. The ~~Company~~adoption isof ~~currently~~this ~~evaluating~~standard ~~the~~did ~~potential~~not ~~impact~~have ofa ~~this~~material ~~guidance~~impact on ~~its~~the Company’s consolidated financial statements and related disclosures.

16In December 2019, the FASB issued authoritative guidance intended to simplify the accounting for income taxes (ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”). This guidance eliminates certain exceptions to the general approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting for income taxes. This guidance is effective for fiscal years beginning after December 15, 2020, including interim periods within those annual periods. The Company is currently evaluating the potential impact of this guidance on its consolidated financial statements.

In January 2020, the FASB issued ASU 2020-01, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivative and Hedging (Topic 815), which clarifies the interaction of rules for equity securities, the equity method of accounting, and forward contracts and purchase options on certain types of securities. The guidance clarifies how to account for the transition into and out of the equity method of accounting when considering observable transactions under the measurement alternative. The ASU is effective for annual reporting periods beginning after December 15, 2020, including interim reporting periods within those annual periods, with early adoption permitted. We are currently evaluating the impact of the new guidance on our consolidated financial statements.

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This ASU amends the guidance on convertible instruments and the derivatives scope exception for contracts in an entity'’s own equity, and ~~also~~ also improves and amends the related EPS guidance for both Subtopics. The ASU will be effective for annual reporting periods after December 15, 2021 and interim periods within those annual periods and early adoption is permitted. We are currently evaluating the impact of the new guidance on our consolidated financial statements.

NOTE 4 – MERGER AND ASSET PURCHASE AGREEMENTS

Ganjarunner Merger

On June 21, 2019, the Company, GR Acquisition, Inc. (“GRA”), a Nevada corporation, Ganjarunner, Inc. (“Ganjarunner”), a California corporation, and Global Wellness, LLC (“GW”), a California limited liability company, (Ganjarunner and GW are hereafter referred to collectively as “GR/GW”) entered into an Agreement and Plan of Merger (the “Merger Agreement”), pursuant to which GR/GW shall merge with and into GRA, with GRA continuing as the surviving entity and wholly-owned subsidiary of the Company (the “Merger”). The Merger closed on June 24, 2019 (the “Closing Date”). Pursuant to the Merger Agreement, the Company agreed to pay to GR/GW $1,000,000, $150,000 of which has already been paid to GR/GW with $300,000 to be paid in two equal tranches of $150,000 whereby each tranche is subject to GRA’s achievement of certain milestones. (i) $350,000 at the earlier to occur of the 6-month anniversary of the Closing Date or upon the Company raising additional funding of at least $2,000,000 and (ii) $300,000 at the end of the 24-month anniversary of the Closing Date. In addition, as further consideration, the Company issued to GR/GW’s founders 1,000,000 shares of the Company’s common stock on the Closing Date and shall make two additional issuances of 2,000,000 shares of common stock on the 12-month and 24-month anniversaries of the Closing Date, with each respective issuance contingent upon GRA’s achievement of certain milestones as set forth in the Merger Agreement.

On October 4, 2019, the Company amended the Merger Agreement with GR/GW. As part of this amendment, the Company issued 5,000,000 warrants to purchase shares of the Company’s common stock to GR/GW. These warrants have a term of three years and an exercise price of $0.50. These warrants replace the previously agreed upon common stock consideration of 5,000,000 shares and eliminated the contingencies related to achieving certain milestones as set forth in the initial merger agreement. The fair value of the stock warrant granted was estimated using the Black-Scholes valuation model. These warrants were valued at $1,933,368. $1,694,092 of the value from the warrants was booked against the previously recorded contingent liability for the stock that the warrants replaced and the remaining $239,276 value from the warrants was expensed.

~~As of June 30, 2020 and December 31, 2019, the Company owed a total of $619,125 and $583,886 on the acquisition, respectively. The amount owed as of June 30, 2020 consist of cash owed of $619,125.~~15

~~Following~~As ~~the~~of ~~closing~~September of30, ~~the~~2020 ~~transaction~~and December 31, ~~Ganjarunner’s~~2019, ~~financial~~the ~~statements~~Company asowed a total of ~~the~~$300,000 ~~Closing~~and ~~Date~~$685,000 ~~were~~on ~~consolidated~~the acquisition, respectively, with ~~the~~a ~~Condensed~~present ~~Consolidated~~value ~~Financial~~of ~~Statements~~$274,041 and $583,886, respectively. The amount owed as of ~~the~~September ~~Company~~30, 2020 consist of cash owed of $300,000.

~~The~~Following ~~following~~the ~~presents~~closing of the ~~consideration~~transaction, ~~paid~~Ganjarunner’s ~~for~~financial ~~the~~statements ~~acquisition~~as of ~~Ganjarunner~~the ~~and~~Closing Date were consolidated with the ~~purchase~~Condensed ~~price~~Consolidated ~~allocation~~Financial Statements of the Company.

Purchase Price
Purchase Price	$	2,987,254
Total purchase price	$	2,987,254
Allocation of purchase price
Tangible Assets/(Liabilities)	$	(459,464	)
Trade Names/Trademarks		877,000
IP/Trade Secrets		801,000
License		306,000
Non-Compete Agreements		39,000
Customer Relationships		152,000
Goodwill		1,271,718
Total allocation of purchase price	$	2,987,254

The following presents the consideration paid for the acquisition of Ganjarunner and the purchase price allocation.

Purchase Price
Purchase Price	$	2,987,254
Total purchase price	$	2,987,254

Allocation of purchase price
Tangible Assets/(Liabilities)	$	(459,464	)
Trade Names/Trademarks		877,000
IP/Trade Secrets		801,000
License		306,000
Non-Compete Agreements		39,000
Customer Relationships		152,000
Goodwill		1,271,718
Total allocation of purchase price	$	2,987,254

Mountain High Asset Purchase

On July 10, 2019 (the “Closing Date”), the Company and Mountain High Recreation, Inc. (“MH”), a California corporation, entered into an Asset Purchase Agreement (the “Purchase Agreement”), pursuant to which the Company acquired certain assets from MH as specified in the Purchase Agreement, which included (i) the option to purchase to MH’s California Cannabis - Retailer Nonstorefront License (ii) the option to purchase a certain real property lease located at 8 Light Sky Ct, Sacramento, CA 95828 associated with that certain license, (iii) the right to use all trademarks and intellectual property associated with the MH brand (the “Assets”). The Company assumed no liabilities of MH. The transactions contemplated by the Purchase Agreement closed on July 10, 2019 (the “Closing”).

Pursuant to the Agreement, the Company agreed to pay to MH the following: $200,000 at Closing, $150,000 on or before December 20, 2019, $150,000 on or before June 30, 2020, $250,000 at the end of the twelfth (12th) month (on a rolling basis) following the Closing Date and $250,000 at the end of the twenty-fourth (24th) month (on a rolling basis) following the Closing Date. In addition, at Closing, the Company issued to MH 1,000,000 shares of its common stock. At the end of the twelfth month (on a rolling basis) from the Closing Date, the Company agreed to issue to MH warrants to purchase 2,000,000 shares of the Company’s Common Stock with an exercise price equal to the per share purchase price paid by investors of the Company’s then most recent private placement and exercisable for a period of three (3) years from the date of issuance (the “2020 Warrants”). At the end of the twenty-fourth month (on a rolling basis) from the Closing Date, the Company shall issue to MH warrants to purchase 2,000,000 shares of the Company’s Common Stock with an exercise price equal to the per share purchase price paid by investors of the Company’s then most recent private placement price, exercisable for a period of three (3) years from the date of issuance (the “2021 Warrants”). The 2020 Warrants and 2021 Warrants are subject to adjustment, based on the amount of gross revenue the Company recognized in connection with the Assets.

On October 4, 2019, the Company amended the Asset Purchase Agreement with Mountain High Recreation, Inc. As part of this amendment, the Company issued 5,000,000 warrants to purchase shares of the Company’s common stock to Mountain High Recreation, Inc. These warrants have a term of three years and an exercise price of $0.50. These warrants replace the previously agreed upon share and warrant consideration and eliminated the contingencies related to the gross revenue recognized in connection with the assets. The fair value of the stock warrant granted was estimated using the Black-Scholes valuation model. These warrants were valued at $1,933,368.

~~As of June 30, 2020 and December 31, 2019, the Company owed a total of $772,857 and $708,347 on the acquisition, respectively. The amount owed as of June 30, 2020 consist of cash owed of $772,857.~~16

~~The following~~As ~~presents~~of ~~the~~September ~~consideration~~30, ~~paid~~2020 ~~for~~and December 31, 2019, the ~~asset~~Company ~~acquisition~~owed ofa ~~Mountain~~total ~~High~~of ~~Recreation~~$850,000 ~~Inc.~~ and $850,000 on the ~~preliminary~~acquisition, ~~purchase~~respectively, with a present value of $776,310 and ~~price~~$708,347, ~~allocation~~respectively. ~~These~~The ~~amounts~~amount ~~are~~owed ~~provisional~~as ~~and~~of ~~may~~September be30, ~~adjusted~~2020 ~~during~~consist ~~the~~of ~~measurement~~cash ~~period~~owed of $850,000.

Purchase Price
Purchase Price	$	2,841,715
Total purchase price	$	2,841,715
Allocation of purchase price
Trade Names / Trademarks	$	1,041,962
IP/Trade Secrets		1,177,060
License		372,684
Non-Compete Agreements		250,009
Total allocation of purchase price	$	2,841,715

The following presents the consideration paid for the asset acquisition of Mountain High Recreation, Inc. and the preliminary purchase price allocation. These amounts are provisional and may be adjusted during the measurement period.

Purchase Price
Purchase Price	$	2,841,715
Total purchase price	$	2,841,715

Allocation of purchase price
Trade Names / Trademarks	$	1,041,962
IP/Trade Secrets		1,177,060
License		372,684
Non-Compete Agreements		250,009
Total allocation of purchase price	$	2,841,715

Budee Merger

On February 27, 2020 (the “Effective Date”), Driven Deliveries, Inc. (the “Company”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among the Company, Budee Acquisition, Inc., a Nevada corporation and Budee, Inc. (“Budee”), a California corporation, pursuant to which the Company acquired Budee (the “Budee Acquisition”). On the Effective Date, all then-issued and outstanding shares of Budee were canceled and Budee issued 1,000,000 new shares of its common stock, representing 100% of the now issued and outstanding shares of Budee, to the Company. As a result, Budee became a wholly-owned subsidiary of the Company. As consideration, the Company agreed to: i) cash payments to Budee of $725,000 in three payments of $225,000, $200,000 and $300,000, due April 15, 2020, July 15, 2020 and October 15, 2020, respectively, and ii) issue to Budee 13,333,333 shares of the Company’s common stock (the “Consideration Shares”). 1,333,333 of the 13,333,333 shares will not be issued until the completion of a lawsuit. Pursuant to the Merger Agreement, holders of the Consideration Shares received the right to have their Consideration Shares registered with the Securities and Exchange Commission if and when the Company files a new registration statement on Form S-1.

As of ~~June~~September 30, 2020 and December 31, 2019, the Company owed a total of $1,~~137~~106,~~294~~497 and $0 on the acquisition, respectively. The amount owed as of ~~June~~September 30, 2020 consist of cash owed of $~~492~~505,~~306~~000 and 1,333,333 shares of common stock value at $~~644~~666,~~988~~667.

The following presents the consideration ~~paid~~ paid for the asset acquisition of Budee, Inc. and the preliminary purchase price allocation. These amounts are provisional and may be adjusted during the measurement period. During the seconds quarter of 2020 the assumed liabilities was increase by $160,000 ~~which~~ which lead to an increase in Goodwill for the same amount.

Purchase Price
Cash	$	690,504
Stock		6,603,722
Assumed liabilities		1,818,538
Total purchase price	$	9,112,764
Allocation of purchase price
Tangible Assets/(Liabilities)	$	85,483
Trade Names/Trademarks		2,522,000
IP/Trade Secrets		1,075,000
License		386,000
Proprietary Software/Technology		4,189,000
Non-Compete Agreements		247,000
Customer Relationships		59,000
Goodwill		549,281
Total allocation of purchase price	$	9,112,764

1917

The following presents the unaudited pro-forma combined results of operations of the Company with the Ganjarunner and Budee Businesses as if the entities were combined on January 1, 2019.

	Six Months			Six Months
	Nine Months			Nine Months
	June 30, 2020			June 30, 2019
	September 30, 2020			September 30, 2019
Gross Revenue	$	814,~~550~~529,~~118~~993		$	6,~~337~~223,~~388~~725
Gross Profit	$	(1,~~099~~237,~~663~~660	)	$	54,~~121~~944,~~530~~064
Net loss	$	(714,~~319~~304,~~946~~770	)	$	(~~793~~7,~~475~~402,688	)
Net loss per share, basic and diluted	$	(0.1323	)	$	(0.0215	)
Weighted average number of shares outstanding		5561,~~819~~263,~~112~~796			4648,~~179~~886,~~458~~493

The unaudited pro-forma results of operations are presented for information purposes only. The unaudited pro-forma results of operations are not intended to present actual results that would have been attained had the acquisitions been completed as of January 1, 2019, or to project potential operating results as of any future date or for any future periods.

NOTE 5 – JOINT VENTURE

On September 30, 2019, the Company entered into a joint venture agreement (the “JV Agreement”) with Budee, Inc., (“Budee’), a privately-held company involved in the delivery of cannabis-related products in California, pursuant to which the parties formed a joint venture company, GanjaBudee Inc., a Nevada Corporation (“GB”), in anticipation of a merger between the parties (the “GanjaBudee Merger’). GB is a separate and independent entity from either party with its own management team and Board of Directors and is owned 51% by the Company and 49% by Budee. The term of GB will continue until such GanjaBudee Merger is effective or any definitive agreement for such GanjaBudee Merger is terminated but in any case will not be for a period of more than sixty months, subject to a mutual extension agreed to by the parties.

In connection with the JV Agreement, the Company and Budee agreed to share certain expenses between the Company and Budee, Inc. The Company is also allowed to charge an additional 10% fee on any of these charged back expenses. The Company charged back expenses to Budee totaling $96,610 during the first quarter of 2020. In addition, pursuant to the JV Agreement the Company agreed to pay certain obligations of Budee Inc. of $250,000. As of ~~June~~September 30, 2020, the Company has not paid this amount. As a result of the merger agreement the Company derecognized a non-controlling interest of $656,189 attributable to the Joint Venture in the Statement of Stockholder’s Equity. See Note 4.

NOTE 6 – NOTES PAYABLE

On August 28, 2019, the Company issued a senior convertible note (“Note”) to M2 Equity Partners (“Holder”), pursuant to which the Holder agreed to advance the Company $1,000,000 in three equal installments, with the final installment advanced on October 30, 2019. The Note matures on August 28, 2020 and is the senior obligation of the Company. The Note’s principal balance of $1,000,000 bears interest at a rate of 10% per annum and interest payments are payable on a monthly basis. The funds from this loan were distributed in three parts with $333,333 being issued on August 30, 2019, September 30, 2019 and October 30, 2019. An additional $497,000 was ~~received~~ received in excess of the original note as of December 31, 2019. These amounts were subject to the same terms as the original note. An additional $1,140,000 was received in excess of the original note during the first quarter of 2020. The principal of the note was amended on January 31, 2020 to be $2,637,000. This amendment also changed the maturity date of the note to February 14, 2021. ~~As of June~~ ~~30, 2020, the Company had received $2,637,000 in funds from the note.~~ Pursuant to the Note, the Holder has the right to convert all or part of the Note to shares of common stock of the Company at a price equivalent to a value of $0.50 per share of common stock on an as-converted basis. As additional consideration for entering into the exchange, the Company issued to the Holder a three-year warrant to purchase 4,500,000 shares of the Company’s common stock at an exercise price of $0.05. The Company also recognized a derivative liability in connection with the note valued at $~~567~~306,~~335~~ 762 as of December 31, 2019 and $~~871~~178,~~391~~108 as of ~~June~~ September 30, 2020. The derivative occurred due to anti-dilution provisions contained in the conversion feature of the note.

To determine how to account for the modification of the Note, the Company performed a net present value test to compare the old note with the new note discounted at the effective interest rate of the original note. Since the change in the net present value between the two notes exceeded 10% of the value of the original note, the note modification needed to be accounted for as an extinguishment of debt. As part of this the Company recognized a $810,518 loss on the extinguishment of debt for the old note. The loss is due to $1,497,000 from the extinguishment of the note, $311,360 from the extinguishment of the derivative offset by $499,505 from the extinguishment of the debt discount and $2,119,373 from the recognition of the new note. The Company recognized a debt discount on the new note of $528,603 at the date of issuance. The Company recognized $126,586 and $210,050 in amortization on the debt discount during the three and six months ended June 30, 2020, respectively, leaving a remaining debt discount of $318,553 at June 30, 2020.18

20To determine how to account for the modification of the Note, the Company performed a net present value test to compare the old note with the new note discounted at the effective interest rate of the original note. Since the change in the net present value between the two notes exceeded 10% of the value of the original note, the note modification needed to be accounted for as an extinguishment of debt. As part of this the Company recognized a $810,518 loss on the extinguishment of debt for the old note. The loss is due to $1,497,000 from the extinguishment of the note, $311,360 from the extinguishment of the derivative offset by $499,505 from the extinguishment of the debt discount and $2,119,373 from the recognition of the new note. The Company recognized a debt discount on the new note of $528,603 at the date of issuance. The Company recognized $127,978 and $331,072 in amortization on the debt discount during the three and nine months ended September 30, 2020, respectively, leaving a remaining debt discount of $190,575 at September 30, 2020 due to the conversion of the note.

In addition, as an inducement to enter into the Note and to fund each advance thereunder, the Company entered into a security agreement with the Holder executed concurrently with the Note (the “Security Agreement”). Pursuant to the Security Agreement, the Company granted the Holder a first priority security interest in certain assets of the Company (the “Collateral”) for the benefit of the Holder to secure the Company’s obligations under the Note. The occurrence of any event of default under the Note, as well as the Company’s failure to observe or perform its obligations under the Security Agreement and such failure goes uncured for five days after receiving notice, constitutes an event of default under the Security Agreement. If an event of default under the Security Agreement occurs, the Holder is entitled to certain rights, including the right to take possession of the Collateral and the right to operate the business of the Company using the Collateral. The Security Agreement terminates when all payments under the Note have been made in full or upon conversion. Matthew Atkinson, a member of M2 owns approximately 5.98% of the Company’s common stock. The Company will also be required to appoint a member of M2 to the Board of Directors of the Company for the duration of the term of the debt. The Company will also make an appointment to the Company’s Board of Directors and audit committee.

During the year ended December 31, 2019, the Company entered into a loan agreement with ~~the,~~ Brian Hayek, the Company’s Chief Financial Officer and a member of its board of directors. Pursuant to the Loan Agreement, the Company issued Mr. Hayek a Secured Convertible Note in the principal amount of $188,743 with an interest rate of 10%. As of ~~June~~September 30, 2020, the amount due on this loan was $184,667. The note is convertible into shares of the Company’s equity securities at a price of $0.50 per share or preferred stock designated by the parties in an amount equivalent to a value of $0.50 per share on an as converted basis. The obligation of the Note is an obligation of the Company other than obligations specifically designated otherwise by the Company. In addition, the Company issued Mr. Hayek warrants to purchase 500,000 shares of the Company’s common stock at an exercise price of $0.50 per share which warrants terminate five years after their issuance. As part of this loan the Company recognized the intrinsic value of a beneficial conversion feature ~~resulting~~ and value of warrants issued resulting in a debt discount of $102,111 as of the date of issuance. The Company had a remaining debt discount of $101,831 at December 31, 2019. The Company recognized $25,~~458~~738 and $5076,~~916~~653 in amortization on the debt discount during the three and ~~six~~nine months ended ~~June~~ September 30, 2020, respectively, leaving a remaining debt discount of $5025,~~916~~718 at ~~June~~September 30, 2020.

On December 31, 2019, the Company entered ~~into~~ into a loan agreement with Christian Schenk, the Company’s former Chairman and Chief Executive Officer and a member of its board of directors, pursuant to which Mr. Schenk extended a loan to the Company in the amount of $50,000 with an interest rate of 10%. In connection with this loan, the Company issued Mr. Schenk a secured convertible note. The note is convertible into equity of the Company at a price of $0.50 per share of common stock. The note was funded with the proceeds from the settlement of $30,000 in accounts payable to Truck That, LLC and a check from Truck That, LLC in the amount of $20,000 (see Note 9). In addition, the Company issued Mr. Schenk warrants to purchase 150,000 shares of the Company’s common stock at an exercise price of $0.50 per share which warrants terminate five years after their issuance.. As part of this loan the Company recognized the intrinsic value of a beneficial conversion feature and value of warrants issued resulting in a debt discount of $28,585 as of the date of issuance. The Company had a remaining debt discount of $28,507 at December 31, 2019. The Company recognized $7,~~126~~205 and $1421,~~253~~ 458 in amortization on the debt discount during the ~~six~~nine months ended ~~June~~ September 30, 2020, respectively, leaving a remaining debt discount of $147,~~253~~048 at ~~June~~September 30, 2020.

~~NOTE 7 – STOCKHOLDERS’ DEFICIT~~19

~~Common~~On July 28, 2020, the Company entered into ~~Stock~~a convertible promissory note with a principal of $1,050,000. The note accrues interest at a rate of 8% per annum. The note converts to the Company’s common stock at a rate of $0.50 per share. This note has an original issuance discount of $50,000. The proceeds of the note will be paid out in two tranches, the first for $787,500 upon the execution of the note and the second for $262,500 30 days after the original funding. Each tranche will be due 12 months from the date of the funding. The Company can prepay the note as follows: if the note is outstanding for less than 90 days than 105% of the principal will be paid, at 91-120 day 110% of the principal will be paid, at 121-180 days 115% of the principal will be paid, and at 181-365 days 120% of the principal will be paid. So long as this note is outstanding, upon any issuance by the Company or any of its subsidiaries of any convertible debt security (whether such debt begins with a convertible feature or such feature is added at a later date) with any term more favorable to the holder of such security or with a term in favor of the holder of such security that was not similarly provided to the holder in this Note, then the Company shall notify the holder of such additional or more favorable term and such term, at the holder's option, shall become a part of this note and its supporting documentation. The types of terms contained in the other security that may be more favorable to the holder of such security include, but are not limited to, terms addressing conversion discounts, terms addressing maturity, conversion look back periods, interest rates, original issue discount percentages and warrant coverage. As part of the note the Company will issue 100,000 shares of the Company’s common stock to the note holder. The Company recorded a debt discount based on the relative fair value of the shares of $47,619. The Company notes the agreement included certain make-whole provisions related to the issuance of these shares which resulted in a liability. The Company did not record the liability as it was determined to be trivial. The Company also recognized a debt discount resulting from the intrinsic value of a beneficial conversion feature of $123,214. The Company recognized $27,681 in amortization on the debt discount during the three and nine months ended September 30, 2020, respectively, leaving a remaining unamortized debt discount of $143,152 at September 30, 2020.

~~The Company~~NOTE is7 ~~authorized~~– ~~to issue 200,000,000 shares of common stock, par value $0.0001 per share.~~STOCKHOLDERS’ DEFICIT

~~During~~Common the six months ended June 30, 2020, the Company issued 1,784,000 shares of common stock for cash of $892,000, 188,000 shares issued for the settlement of accounts payable, 10,628,611 shares issued for the exercise of warrant, and 450,000 shares issued for the exercise of options. 12,000,000 shares were issued relating to the merger with Budee. See Note 4.Stock

~~Preferred~~The Company is authorized to issue 200,000,000 ~~Stock~~shares of common stock, par value $0.0001 per share.

~~The~~During the nine months ended September ~~Company~~30, is2020, ~~authorized~~the toCompany ~~issue~~issued 154,~~000~~384,000 shares of ~~preferred~~common stock, ~~par~~for ~~value~~cash of $~~0.0001~~2,018,000, ~~per~~188,000 ~~share.~~shares ~~The~~issued ~~preferred~~for ~~stock~~the ~~may~~settlement of beaccounts payable, 10,628,611 shares issued ~~from~~ ~~time~~for tothe ~~time~~exercise inof ~~one~~warrant, or450,000 ~~more~~shares ~~series~~issued asfor the ~~Company’s~~exercise ~~Board~~of ~~may~~options, ~~authorize.~~100,000 share ~~None~~issued ofwith ~~the~~notes ~~preferred~~payable, ~~stock~~5,000,000 ~~has~~shares ~~been~~issued ~~designated~~ related to legal settlement (See Note 8), and ~~none~~1,873,565 ~~are~~shares issued for conversion of interest and ~~outstanding~~penalties ason ofnotes ~~June~~payable 30(See Note 6). 12,000,000 ~~2020~~shares ~~and~~were ~~December~~issued ~~31,~~relating ~~2019~~to the merger with Budee (See Note 4).

21On August 6, 2020, the Company filed an S-1. With this S-1 the Company is making an offering of up to 10,000,000 shares of common stock.

~~Warrants~~Preferred Stock

~~There were~~The ~~23,694,750~~Company ~~warrants~~is ~~outstanding~~authorized asto issue 15,000,000 shares of ~~June~~preferred 30stock, ~~2020~~par value $0.0001 per share. The ~~fair~~preferred ~~value~~stock ofmay ~~each~~be ~~stock~~issued ~~warrant~~from ~~granted~~time ~~was~~to ~~estimated~~time ~~using~~in ~~the~~one or more series ~~Black-Scholes~~as ~~valuation~~the ~~model~~Company’s ~~with~~Board may authorize. None of the ~~assumptions~~preferred stock has been designated and none are issued and outstanding as ~~follows:~~of September 30, 2020 and December 31, 2019.

Exercise price	$	0.05 - $0.50
Expected dividend yield		0	%
Risk free interest rate		0.23% - 1.71	%
Expected life in years		3-7
Expected volatility		133% - 148	%
Estimated fair value of stock on grant date	$	0.50 – $0.73

Warrants

There were 2925,~~243~~128,~~750~~272 warrants outstanding as of ~~December~~September 3130, ~~2019~~2020. The fair value of each stock warrant granted was estimated using the Black-Scholes valuation model with the assumptions as follows:

Exercise price	$	0.1004 - $0.50
Expected dividend yield		0	%
Risk free interest rate		10.4218% - 21.6671	%
Expected life in years		3-7
Expected volatility		~~134~~133% - ~~158~~152	%
Estimated fair value of stock on grant date	$	0.50
Estimated fair value of stock on measurement date	$	0.44 – $0.73

~~The Company~~There ~~uses~~were ~~the~~29,243,750 ~~latest~~warrants ~~common stock sale price~~ outstanding as ~~the fair value~~ of ~~stock~~December on31, ~~grant~~2019. ~~date~~The ~~rather~~fair ~~than the market~~ value of ~~the~~each stock as ~~the~~warrant ~~Company~~granted ~~believes~~was ~~this~~estimated isusing athe ~~more~~Black-Scholes ~~accurate~~ valuation ofmodel ~~the Company’s common stock due to the lack of sufficient volume~~with ~~and trading history on~~ the ~~Company’s~~assumptions ~~common~~as ~~stock on the OTC Markets.~~follows:

A summary of warrant issuances are as follows:

Exercise price	$	0.10 - $0.50
Expected dividend yield		0	%
Risk free interest rate		1.42% - 2.66	%
Expected life in years		3-7
Expected volatility		134% - 158	%
Estimated fair value of stock on measurement date	$	0.50

	Number			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life
Warrants
Outstanding January 1, 2019		9,131,250			0.19		3.83
Granted		27,658,000			0.44		4.29
Forfeited		(7,545,500	)		0.34		4.48
Outstanding December 31, 2019		29,243,750		$	0.39		4.10
Granted		7,551,000			0.24		2.86
Exercised		(13,100,000	)		0.33		4.16
Outstanding June 30, 2020		23,694,750		$	0.37		3.04

Nonvested Warrants	Shares
Nonvested at January 1, 2019		-
Granted		27,658,000
Vested		(19,762,500	)
Forfeited		(7,545,500	)
Nonvested at December 31, 2019		350,000
Granted		7,551,000
Vested		(7,609,333	)
Nonvested at June 30, 2020		291,667

The Company uses the latest common stock sale price as the fair value of stock on grant date rather than the market value of the stock as the Company believes this is a more accurate valuation of the Company’s common stock due to the lack of sufficient volume and trading history on the Company’s common stock on the OTC Markets.

22A summary of warrant issuances are as follows:

During the first quarter of 2020, the Company issued warrants to purchase an aggregate of 5,335,000 shares of common stock of the Company at an exercise price of $0.05 or $0.50 per share. The warrants may be exercised on a cashless basis and have a term of three, five, or seven years. 375,000 warrants were issued for consulting services, 4,500,000 warrants in connection with notes issued to M2, and 460,000 warrants in connection with stock sold.

	Number			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life
Warrants
Outstanding January 1, 2019		9,131,250			0.19		3.83
Granted		27,658,000			0.44		4.29
Forfeited		(7,545,500	)		0.34		4.48
Outstanding December 31, 2019		29,243,750		$	0.39		4.10
Granted		13,484,522			0.27		3.58
Exercised		(17,600,000	)		0.24		2.91
Outstanding September 30, 2020		25,128,272		$	0.42		3.77

During the second quarter of 2020, the Company issued warrants to purchase an aggregate of 2,216,000 shares of common stock of the Company at an exercise price of $0.55 or $0.50 per share. The warrants may be exercised on a cashless basis and have a term of three, or five years. 986,000 warrants were issued for consulting services, 120,000 warrants issued for the settlement of accounts payable, and 1,110,000 warrants in connection with stock sold.

Nonvested Warrants	Shares
Nonvested at January 1, 2019		-
Granted		27,658,000
Vested		(19,762,500	)
Forfeited		(7,545,500	)
Nonvested at December 31, 2019		350,000
Granted		13,484,522
Vested		(13,236,605	)
Nonvested at September 30, 2020		597,917

~~The~~During the first quarter of 2020, the Company ~~recognized~~issued awarrants to purchase an aggregate of 5,335,000 shares of common stock ~~compensation~~of ~~expense~~the Company at an exercise price of $~~837,185~~0.05 or $0.50 per share. The warrants may be exercised on a cashless basis and ~~$620~~have a term of three,~~585~~ ~~six~~five, ~~months~~or ~~ended~~seven ~~June~~years. 30375,000 warrants ~~2020~~were ~~and~~issued ~~2019~~for consulting services, ~~related~~4,500,000 warrants in connection with notes issued to M2, and 460,000 warrants in connection with stock sold.

~~The~~During the second quarter of 2020, the Company ~~recognized~~issued awarrants to purchase an aggregate of 2,216,000 shares of common stock ~~compensation~~of ~~expense~~the Company at an exercise price of $~~630,920~~0.55 or $0.50 per share. The warrants may be exercised on a cashless basis and ~~$516,953~~have a term of three, ~~months~~or ~~ended~~five ~~June~~years. 30986,000 ~~2020~~warrants were issued for consulting services, 120,000 warrants issued for the settlement of accounts payable, and ~~2019~~1,110,000 ~~related~~warrants toin ~~warrants~~connection with stock sold.

~~Options~~During the third quarter of 2020, the Company issued warrants to purchase an aggregate of 5,933,522 shares of common stock of the Company at an exercise price of $0.04, $0.50 or $0.57 per share. The warrants may be exercised on a cashless basis and have a term of three, five, or seven years. 208,000 warrants were issued for services, 3,105,522 were issued in connection with a note, and 2,620,000 warrants in connection with stock sold.

~~There were~~The ~~6,581,434~~Company ~~options~~recognized ~~outstanding~~a asstock compensation expense of ~~June 30~~$2,501,803 ~~2020.~~and ~~The~~$5,510,766 ~~fair~~for ~~value~~the ofnine ~~each~~months ~~stock~~ended ~~option~~September ~~granted~~30, ~~was~~2020 ~~estimated~~and ~~using~~2019, ~~the~~related ~~Black-Scholes valuation~~to ~~model with the assumptions as follows:~~warrants.

Exercise price	$	0.59
Expected dividend yield		0	%
Risk free interest rate		0.77	%
Expected life in years		3
Expected volatility		150	%
Estimated fair value of stock on grant date	$	0.50

~~There~~The ~~were~~Company ~~7,879,933~~recognized ~~options~~a ~~outstanding~~stock ascompensation expense of ~~December 31~~$1,873,565 ~~2019.~~and ~~The~~$4,890,181 ~~fair~~for ~~value~~the ofthree months ended ~~each~~September ~~stock~~30, ~~option~~2020 ~~granted~~and ~~was~~2019, ~~estimated~~respectively, ~~using~~related ~~the Black-Scholes~~to ~~valuation model with the assumptions as follows:~~warrants.

Exercise price	$	0.10 - $0.50
Expected dividend yield		0	%
Risk free interest rate		1.49% - 2.63	%
Expected life in years		7
Expected volatility		153% - 157	%
Estimated fair value of stock on grant date	$	0.50

Options

~~The Company~~There ~~uses~~were ~~the~~6,611,434 ~~latest~~options ~~common stock sale price~~ outstanding as ~~the fair value~~ of ~~stock~~September on30, ~~grant~~2020. ~~date~~The ~~rather~~fair ~~than the market~~ value of ~~the~~each stock as ~~the~~option ~~Company~~granted ~~believes~~was ~~this~~estimated isusing athe ~~more~~Black-Scholes ~~accurate~~ valuation ofmodel ~~the Company’s common stock due to the lack of sufficient volume~~with ~~and trading history on~~ the ~~Company’s~~assumptions ~~common~~as ~~stock on the OTC Markets.~~follows:

Exercise price	$	0.59 – 0.75
Expected dividend yield		0	%
Risk free interest rate		0.25-0.77	%
Expected life in years		3
Expected volatility		150-152	%
Estimated fair value of stock on grant date	$	0.40-0.61

AThere were 7,879,933 options outstanding ~~summary~~as of ~~options~~December ~~issuances~~31, ~~are~~2019. The fair value of each stock option granted was estimated using the Black-Scholes valuation model with the assumptions as follows:

	Number			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Weighted Average Grant Date Fair Value
Exercise price	$	0.10 - $0.50
Options
Expected dividend yield		0	%
Outstanding January 1, 2019		4,854,692			0.04		3.00		0.19
Risk free interest rate		1.49% -2.63	%
Granted		6,210,022			0.16		5.13		0.24
Expected life in years		7
Forfeited		(3,184,781	)		0.19		3.53		0.19
Expected volatility		153% - 157	%
Outstanding December 31, 2019		7,879,933		$	0.14		4.74	$	0.24
Estimated fair value of stock on grant date	$	0.50
Granted		112,500			0.59		2.73		0.40
Exercised		(450,000	)		0.10		5.66		0.20
Forfeited		(960,999	)		0.97		14.41		0.24
Outstanding June 30, 2020		6,581,434		$	0.15		4.47	$	0.24

Nonvested Shares	Shares
Nonvested at January 1, 2019		3,641,019
Granted		6,210,022
Vested		(2,840,194	)
Forfeited		(3,184,781	)
Nonvested at December 31, 2019		3,826,066
Granted		112,500
Vested		(883,445	)
Forfeited		(631,390	)
Nonvested at June 30, 2020		2,423,731

24A summary of options issuances are as follows:

During the first quarter of 2020, the Company issued stock options to purchase an aggregate of 112,500 shares of common stock of the Company at an exercise price of $0.59 per share. The options expire in three years from the grant date.

	Number			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Weighted Average Grant Date Fair Value
Options
Outstanding January 1, 2019		4,854,692			0.04		3.00		0.19
Granted		6,210,022			0.16		5.13		0.24
Forfeited		(3,184,781	)		0.19		3.53		0.19
Outstanding December 31, 2019		7,879,933		$	0.14		4.74	$	0.24
Granted		142,500			0.79		3.52		0.56
Exercised		(450,000	)		0.10		5.66		0.20
Forfeited		(960,999	)		0.97		14.41		0.24
Outstanding September 30, 2020		6,611,434		$	0.13		4.10	$	0.22

During the second quarter of 2020, the Company issued no stock options.

Nonvested Shares	Shares
Nonvested at January 1, 2019		3,641,019
Granted		6,210,022
Vested		(2,840,194	)
Forfeited		(3,184,781	)
Nonvested at December 31, 2019		3,826,066
Granted		142,500
Vested		(947,490	)
Forfeited		(960,999	)
Nonvested at September 30, 2020		2,060,077

~~The Company recognized a stock compensation expense of $243,516 and $351,048 respectively for the six months ended June 30, 2020 and 2019, related to stock options.~~22

~~The~~During the first quarter of 2020, the Company ~~recognized~~issued a stock ~~compensation~~options ~~expense~~to purchase an aggregate of ~~$121~~112,~~977~~500 ~~and~~shares ~~$106,986~~of ~~respectively~~common ~~for~~stock of the ~~three~~Company ~~months~~at ~~ended~~an ~~June~~exercise ~~30,~~price ~~2020~~of ~~and~~$0.59 ~~2019,~~per ~~related~~share. toThe ~~stock~~ options expire in three years from the grant date.

~~NOTE~~During the second quarter of 2020, the 8Company –issued ~~COMMITMENTS~~no ~~AND~~stock ~~CONTINGENCIES~~options.

~~Carla~~During ~~Baumgartner,~~the ~~Chris~~third ~~Haas,~~quarter ~~and~~of ~~Eric Steele (“Plaintiff”) filed a Complaint against Driven Deliveries~~2020, ~~Inc. (“Driven”), and Brian Hayek and Christian~~the ~~Schenk,~~Company ~~individually,~~issued onstock ~~November~~options ~~26,~~to ~~2019~~purchase inan ~~San~~aggregate Diego County Superior Court, Case No. 37-2019-00063208. In June 2019, Driven entered into a Merger Agreement with Ganjarunner, Inc. (“Ganjarunner”), whereby Driven acquired Ganjarunner. Plaintiffs, the former owners of ~~Ganjarunner~~30,000 ~~allege~~shares ~~in their First Amended Complaint causes~~ of ~~action~~common ~~for~~stock ~~Breach~~ of the ~~Merger~~Company ~~Agreement, Fraudulent~~at ~~Inducement,~~an ~~Fraudulent~~exercise ~~Concealment,~~price ~~Negligent Misrepresentation, Breach~~ of ~~Fiduciary Duty, Violation of Corporate Code~~ ~~§ 25401, Conversion, Unfair Competition, and Violation of Penal Code §496~~$0.75 Onper ~~February 18, 2020, Driven filed a Demurrer to Plaintiffs’ First Amended Complaint challenging seven of Plaintiffs’ nine causes of action~~share. The ~~hearing~~options onexpire ~~the~~in ~~demurrer, original~~three ~~set~~years ~~for~~from ~~May~~the 1,grant ~~2020, has been continued indefinitely due to Court closures~~date. ~~The Company intends to vigorously defend against this action. See Note 10 for settlement details.~~

~~In February~~The ~~2020~~Company ~~Irth~~recognized ~~Communications, LLC filed~~ a ~~complaint~~stock incompensation ~~the~~expense ~~Superior Court~~ of ~~California, County of Los Angeles, against the~~ ~~Company. The complaint alleges that pursuant to a services agreement the Company issued Irth 500~~$311,~~000~~312 ~~shares~~and ~~of its common stock but the Company breached this agreement because according to the complaint~~$470,394 ~~the~~respectively ~~Company~~for ~~has refused to authorized its transfer agent to remove~~ the ~~restrictive~~nine ~~legend~~months onended ~~the~~September ~~Shares. Among other remedies~~30, ~~Irth~~2020 ~~seeks~~and ~~at least $1~~2019,~~130,000~~ inrelated ~~compensatory damages, attorneys’ fees, and injunctive relief. The Company is reviewing the Complaint and intends~~ to ~~defend~~stock ~~itself vigorously~~options.

~~On January~~The ~~3, 2020, the~~ Company ~~entered~~recognized ~~into~~ a ~~consulting~~stock ~~agreement.~~compensation Asexpense ~~part~~ of ~~this agreement the Company will pay the Consultant~~ $1067,~~000~~797 ~~upon signing of the agreement~~ and ~~an additional~~ $15118,~~000~~065 30respectively ~~days~~for ~~and 60 days after~~ the ~~signing~~three ofmonths ~~the~~ended ~~agreement.~~September ~~The Company will also issue 80~~30,~~000~~ ~~warrants~~2020 ~~to purchase the shares of the Company’s common stock at an exercise price of $0.50 per share~~ and ~~a term of seven years. On June 3~~2019, ~~2020~~related ~~this agreement was amended~~ to ~~issue~~stock ~~cashless warrant for an 200,000 in lieu of the 80,000 previous warrants with a cashless exercise price of $0~~options.50 and the payment schedule was updated to $10,000.00 on January 1, 2020; $5,000.00 on February 1, 2020; $15,000.00 on March 1, 2020; $10,000.00 on April 1, 2020; $10,000.00 on May 1, 2020; and $11,500.00 June 1, 2020

~~On April~~NOTE ~~23, 2020, the Company entered into a consulting agreement for investor relation services. As part of this agreement the Company will pay a monthly fee of $~~8~~,000.~~ ~~This~~– ~~monthly~~COMMITMENTS ~~fee~~AND ~~will also increase by 5% every 12 months of service.~~CONTINGENCIES

OnCarla Baumgartner, Chris Haas, and Eric ~~March~~Steele 1(“Plaintiff”) filed a Complaint against Driven Deliveries, ~~2020~~Inc. ~~the~~(“Driven”), ~~Company~~and Brian Hayek and Christian Schenk, individually, on November 26, 2019 in San Diego County Superior Court, Case No. 37-2019-00063208. In June 2019, Driven entered into a ~~consulting~~Merger ~~agreement~~Agreement with Ganjarunner, Inc. As(“Ganjarunner”), ~~part~~whereby ofDriven ~~this~~acquired ~~agreement~~Ganjarunner. Plaintiffs, the ~~Company~~former ~~will~~owners ~~issue~~of Ganjarunner, allege in their First Amended Complaint causes of action for Breach of the ~~consultant~~Merger aAgreement, ~~warrant~~Fraudulent ~~for~~Inducement, ~~250~~Fraudulent Concealment,~~000~~ ~~shares~~Negligent Misrepresentation, Breach of ~~DRVD~~Fiduciary ~~stock~~Duty, ~~with~~Violation aof Corporate ~~cashless~~Code ~~exercise~~§ ~~feature~~25401, atConversion, anUnfair ~~exercise~~Competition, ~~price~~and Violation of $Penal Code §496.50 ~~per~~On ~~share~~February ~~and~~18, 2020, Driven filed a 3Demurrer ~~year~~to Plaintiffs’ First Amended Complaint challenging seven of Plaintiffs’ nine causes of action. The ~~expiration~~hearing ~~period~~on the demurrer, original set for May 1, 2020, has been continued indefinitely due to Court closures. The Company intends to vigorously defend against this action. See Note 10 for settlement details.

25On July 13, 2020 the Company reached a settlement agreement with Carla Baumgartner, Chris Haas, and Eric Steele who filed a Complaint against Driven Deliveries, Inc., and Brian Hayek and Christian Schenk, individually, on November 26, 2019 in San Diego County Superior Court, Case No. 37-2019-00063208. As part of the settlement agreement Driven shall issue and deliver 5,000,000 shares of restricted common stock of Driven (DRVD) to Plaintiffs, thereby nullifying the Amendment and the Warrants issued as part of the Amendment. Additionally, cash consideration is due to the Plaintiffs on the following schedule: 1) One Hundred Seventy-Five Thousand Dollars ($175,000) immediately upon the signing of the agreement (“Effective Date”); 2) Eighty-Five Thousand Dollars ($85,000) within fourteen (14) days following the Effective Date 3) One Hundred Seventy-Five Thousand Dollars ($175,000) within thirty (30) days following the Effective Date; 4) Seventy-Five Thousand Dollars ($75,000) within sixty (60) days following the Effective Date; and 5) Three Hundred Thousand Dollars ($300,000) on or before July 1, 2021. The 5,000,000 shares issued were valued at $2,750,000 with this expense being recognized during the three months ended September 30, 2020. As of September 30, 2020, the outstanding balance on this settlement is $300,000.

~~NOTE~~In February 2020, Irth Communications, 9LLC –filed ~~RELATED~~a ~~PARTY~~complaint ~~TRANSACTIONS~~in the Superior Court of California, County of Los Angeles, against the Company. The complaint alleges that pursuant to a services agreement the Company issued Irth 500,000 shares of its common stock but the Company breached this agreement because according to the complaint, the Company has refused to authorized its transfer agent to remove the restrictive legend on the Shares. Among other remedies, Irth seeks at least $1,130,000 in compensatory damages, attorneys’ fees, and injunctive relief. The Company is reviewing the Complaint and intends to defend itself vigorously.

~~Transactions~~On January 3, 2020, the Company entered ~~involving~~into ~~related~~a ~~parties~~consulting ~~cannot~~agreement. beAs ~~presumed~~part toof bethis ~~carried~~agreement ~~out~~the onCompany will pay the Consultant $10,000 upon signing of the agreement and an ~~arm’s-length~~additional ~~basis~~$15,000 as30 days and 60 days after the ~~requisite~~signing ~~conditions~~of the agreement. The Company will also issue 80,000 warrants to purchase the shares of the Company’s common stock at an exercise price of $0.50 per share and a term of seven years. ~~competitive~~On June 3, ~~free-market~~2020 ~~dealings~~this ~~may~~agreement ~~not~~was ~~exist.~~amended ~~Representations~~to ~~about~~issue ~~transactions~~cashless ~~with~~warrant ~~related~~for ~~parties~~an 200,000 ifin ~~made~~lieu of the 80,000 ~~shall~~previous ~~not~~warrants ~~imply~~with ~~that~~a ~~the~~cashless ~~related~~exercise ~~party~~price ~~transactions~~of ~~were~~$0.50 ~~consummated~~and onthe ~~terms~~payment ~~equivalent~~schedule was updated to ~~those~~$10,000.00 ~~that~~on ~~prevail~~January in1, ~~arm’s-length~~2020; ~~transactions~~$5,000.00 on February ~~unless~~1, ~~such~~2020; ~~representations~~$15,000.00 ~~can~~on beMarch ~~substantiated~~1, 2020; $10,000.00 on April 1, 2020; $10,000.00 on May 1, 2020; and $11,500.00 June 1, 2020

On ~~August~~April 2823, ~~2019~~2020, the Company ~~issued~~entered into a ~~senior convertible~~consulting ~~note~~agreement ~~(“Note”)~~for toinvestor M2relation ~~Equity Partners (“Holder”), pursuant to which the Holder agreed to advance the Company $1,000,000~~services. ~~The~~As ~~principal~~part of ~~the~~this ~~note~~agreement ~~was amended on January 31, 2020 to be $2,637,000 As additional consideration,~~ the Company ~~issued~~will topay ~~the Holder~~ a ~~three-year~~monthly ~~warrant~~fee ~~to purchase 4,500,000 shares~~ of ~~the Company’s common stock at an exercise price of~~ $~~0.05. The Company also recognized a derivative liability in connection with the note valued at $567~~8,335 as of December 31, 2019 and $558,160 as of June 30, 2020. M2 is a related party due to the terms of the note giving them a seat on the board of directors of the Company. As of June 30, 2020 there was $2,637,000 ~~outstanding on the note~~. ~~There was an interest expense of $11,695~~ ~~and~~This ~~$55,043~~monthly ~~related~~fee towill ~~this~~also ~~note~~increase ~~during~~by ~~the~~5% ~~three~~every ~~and~~12 ~~six~~ months ~~ended June 30, 2020, respectively. There is a total accrued interest~~ of ~~$55,043 as of June 30, 2020~~service. ~~See Note 6.~~

~~During~~On ~~the~~March ~~year ended December 31~~1, ~~2019,~~2020 the Company entered into a ~~loan~~consulting agreement. ~~with~~As ~~the~~part ~~Company’s~~of ~~CFO,~~this ~~Brian~~agreement ~~Hayek,~~ the Company’s ~~Chairman~~will ~~and~~issue ~~Chief~~the ~~Executive Officer~~consultant ~~and~~ a ~~member~~warrant offor ~~the~~250,000 ~~Company’s~~shares ~~board~~ of ~~directors.~~DRVD ~~Pursuant to the Loan Agreement, the Company issued Mr. Hayek a~~stock ~~Secured~~with ~~Convertible, pursuant to which Mr. Hayek extended~~ a ~~loan~~cashless toexercise ~~the~~feature ~~Company~~at ~~in the amount of $188,743 with~~ an ~~interest~~exercise ~~rate of~~price ~~10%. As~~ of ~~June 30, 2020, the amount due on this loan was~~ $~~184,667~~.50 ~~There~~per ~~was~~share ~~an interest expense of $4,604~~ and ~~$9,208 related to this note during the three and six months ended June 30, 2020, respectively. There is~~ a ~~total~~3 ~~accrued~~year ~~interest~~expiration ~~of $14,360 as of June 30, 2020~~period.

On December 31, 2019, the Company entered into a loan agreement with Christian Schenk, the Company’s Chairman and Chief Executive Officer and a member of the Company’s board of directors, pursuant to which Mr. Schenk extended a loan to the Company in the amount of $50,000 with an interest rate of 10%. As of June 30, 2020, the amount due on this loan was $50,000. There was an interest expense of $1,233 and $2,493 related to this note during the three and six months ended June 30, 2020, respectively. There is a total accrued interest of $2,506 as of June 30, 2020.23

~~On March~~NOTE ~~25,~~9 ~~2020,~~– ~~the~~RELATED ~~board~~PARTY of directors of the Company appointed Christopher DeSousa as a member of the Board, with such appointment to take effect immediately. In connection with his appointment, the Board approved a grant of an option to purchase 112,500 shares of the Company’s common stock at an exercise price of $0.59 per share. These options vest quarterly over one year and expire in three years from the grant date. In addition, Mr. DeSousa shall receive an option to purchase 28,125 shares of Common Stock at the exercise price of $0.59 for each quarter he serves on the Board.TRANSACTIONS

26On August 28, 2019, the Company issued a senior convertible note (“Note”) to M2 Equity Partners (“Holder”), pursuant to which the Holder agreed to advance the Company $1,000,000. The principal of the note was amended on January 31, 2020 to be $2,637,000. As additional consideration, the Company issued to the Holder a three-year warrant to purchase 4,500,000 shares of the Company’s common stock at an exercise price of $0.05. The Company also recognized a derivative liability in connection with the note valued at $306,762 as of December 31, 2019 and $623,032 as of September 30, 2020. M2 is a related party due to the terms of the note giving them a seat on the board of directors of the Company. As of September 30, 2020, there was $2,637,000 outstanding on the note. There was an interest expense of $62,855 and $171,947 related to this note during the three and nine months ended September 30, 2020, respectively. There is a total accrued interest of $0 as of September 30, 2020. The interest on this note was converted to share of common stock on September 22, 2020. See Note 6.

~~NOTE~~During the year ended December 31, 2019, the Company entered into a loan agreement with the Company’s CFO, Brian Hayek, the Company’s Chairman and Chief Executive Officer and a member of the Company’s board of directors. Pursuant to the Loan Agreement, the Company issued Mr. Hayek a Secured Convertible, pursuant to which Mr. Hayek extended a loan to the Company in the amount of $188,743 with an interest rate of 10%. –As ~~SUBSEQUENT~~of ~~EVENTS~~September 30, 2020, the amount due on this loan was $184,667. There was an interest expense of $4,655 and $13,863 related to this note during the three and nine months ended September 30, 2020, respectively. There is a total accrued interest of $19,015 as of September 30, 2020.

On ~~July~~ 13December 31, ~~2020~~2019, the Company ~~reached~~entered into a ~~settlement~~loan agreement with ~~Carla Baumgartner, Chris Haas, and Eric Steele (“Plaintiff”) who filed a Complaint against Driven Deliveries, Inc. (“Driven”), and Brian Hayek and~~ Christian Schenk, ~~individually, on~~the ~~November~~Company’s ~~26,~~Chairman ~~2019~~and inChief ~~San~~Executive ~~Diego~~Officer ~~County~~and ~~Superior~~a ~~Court,~~member ~~Case No. 37-2019-00063208. As part~~ of the ~~settlement agreement Driven~~Company’s ~~shall~~board ~~issue~~of ~~and deliver 5~~directors,~~000,000~~ ~~shares~~pursuant ofto ~~restricted~~which ~~common~~Mr. ~~stock~~Schenk ofextended ~~Driven~~a ~~(DRVD)~~loan to ~~Plaintiffs,~~the ~~thereby~~Company ~~nullifying~~in the ~~Amendment and~~amount ~~the~~of ~~Warrants~~$50,000 ~~issued~~with asan ~~part~~interest rate of ~~the Amendment~~10%. ~~Additionally~~As ~~cash~~of ~~consideration~~September is30, ~~due~~2020, to the ~~Platintiffs~~amount due on ~~the~~this ~~following~~loan ~~schedule: 1)~~was ~~One Hundred Seventy-Five Thousand Dollars (~~$~~175~~50,000). ~~immediately~~There ~~upon~~was ~~the~~an ~~signing~~interest expense of ~~the agreement (“Effective Date”); 2) Eighty-Five Thousand Dollars (~~$851,~~000)~~260 ~~within~~and ~~fourteen (14) days following the Effective Date~~ $3~~) One Hundred Seventy-Five Thousand~~,753 ~~Dollars~~related ~~($175,000)~~to ~~within~~this ~~thirty~~note ~~(30)~~during ~~days following~~ the ~~Effective~~three ~~Date;~~and 4)nine ~~Seventy-Five~~months ~~Thousand~~ended ~~Dollars~~September ~~($75~~30,~~000)~~ ~~within~~2020, ~~sixty (60)~~respectively. ~~days~~There ~~following~~is ~~the~~a ~~Effective~~total ~~Date;~~accrued ~~and~~interest of ~~5) Three Hundred Thousand Dollars (~~$~~300~~3,~~000)~~767 onas orof ~~before~~September ~~July 1~~30, ~~2021~~2020.

On ~~July~~March 2725, 2020, the ~~Company~~board ~~sold~~of ~~2,600,000~~directors ~~shares~~ of the Company’s ~~common~~appointed ~~stock~~Christopher ~~and~~DeSousa 2as a member of the Board,~~600~~ with such appointment to take effect immediately. In connection with his appointment,~~000~~ ~~warrants~~the Board approved a grant of an option to purchase 112,500 shares of the ~~company~~Company’s common stock ~~for $1,300,000.~~at Asan ~~part~~exercise price of ~~this~~$0.59 ~~investment~~per ~~the~~share. ~~Company~~These ~~also~~options ~~paid~~vest ~~$104,000~~quarterly ~~and~~over ~~issued~~one ~~208,000~~year ~~warrants~~and toexpire ~~purchase~~in ~~shares~~three ofyears from the ~~company’s~~grant date. ~~common~~In ~~stock~~addition, aMr. ~~funding~~DeSousa ~~fee~~shall ~~for~~receive ~~effectuating~~an ~~the~~option ~~investment.~~to ~~These~~purchase ~~warrants~~28,125 ~~have~~shares anof Common Stock at the exercise price of $0.5559 ~~per~~for each ~~share~~quarter ~~and~~he aserves ~~term of~~on ~~three~~the ~~years~~Board.

On July 286, 2020, ~~the~~Chris ~~Company~~DeSousa ~~entered~~resigned ~~into~~as a ~~convertible~~Director ~~promissory~~of ~~note~~Driven ~~with~~Deliveries, aInc., ~~principal~~effective ~~of $1,050,000~~immediately. ~~The note will accrue a one time interest charge of 8%~~Mr. ~~The note converts to The Company~~DeSousa’s ~~common~~resignation ~~stock~~was atnot ~~a rate of $0.50 per share. This note has an original issuance discount of $37,500. The proceeds of~~ the ~~note~~result ~~will be paid out in two tranches, the first for $750,000 upon the execution~~ of ~~the~~any ~~note and~~dispute ~~the~~or ~~second~~disagreement ~~for~~with ~~$250,000~~Company 30or ~~days after~~ the ~~original~~Company’s ~~funding.~~board ~~Each tranche will be due 12 months from the date~~ of ~~the~~Directors ~~funding. The Company can prepay the note based~~ on ~~the~~any ~~days~~matter ~~the~~relating ~~note~~to ~~is outstanding. If~~ the ~~note is outstanding for less than 90 days then 105% of the principal will be paid~~operations, atpolicies ~~91-120~~or ~~day 110% of the principal will be paid, at 121-180 days 115% of the principal will be~~practices ~~paid, and at 181-365 days 120%~~ of the ~~principal will be paid. As part of the note the~~ Company ~~will issue 100,000 share of the Company’s common stock to the note holder~~.

On ~~July~~August 197, 2020, Salvador Villanueva, the Company’s ~~issued a promissory note for $500~~President,~~000.~~ ~~The~~was ~~effective~~appointed ~~date~~to of the ~~note~~Company’s isboard ~~June 19, 2020. This note will accrue 6% interest and a default interest rate~~ of ~~8%.~~directors ~~This note will be issued in three tranches with $200,000 being 10 days after the execution of the note, $200,000 being issued 30 days after the note~~ and ~~$100,000~~interim ~~being issued 45 days after the note~~CEO.

On ~~August~~July 619, 2020, the Company ~~filed~~issued ana ~~S-1.~~promissory ~~With~~note ~~this~~for ~~S-1~~$500,000 ~~the~~to ~~Company~~a isrelated ~~making~~party. anThe ~~offering~~related ofparty upis toa ~~10,000,000~~company ~~shares~~whose ofCEO ~~common~~is ~~stock.~~also ~~See~~a ~~the~~board ~~S-1~~member ~~filed~~of ~~with~~ the ~~SEC~~Company. on(See ~~August~~Note ~~6, 2020~~10).

On July 6, 2020 Chris DeSousa resigned as a Director of Driven Deliveries, Inc., effective immediately. Mr. DeSousa’s resignation was not the result of any dispute or disagreement with Company or the Company’s board of Directors on any matter relating to the operations, policies or practices of the Company.24

OnNOTE ~~August~~10 7,– ~~2020,~~NOTES ~~Salvador~~RECEIVABLE ~~Villanueva, the Company’s president, was appointed to the Company’s board of directors.~~

27On July 19, 2020, the Company issued a promissory note for $500,000 to a related party. The related party is a company whose CEO is also a board member of the Company. The effective date of the note is June 19, 2020. This note will accrue 6% interest and a default interest rate of 8%. This note will be issued in three tranches with $200,000 being 10 days after the execution of the note, $200,000 being issued 30 days after the note and $100,000 being issued 45 days after the note. The Company had $2,466 and $2,466 interest income from the note for the three and nine months ended September 30, 2020, respectively.

~~Item 2. Management’s~~NOTE ~~Discussion~~11 ~~and~~– ~~Analysis~~SUBSEQUENT ~~of Financial Condition and Results of Operation~~EVENTS

~~Certain statements~~On inOctober ~~“Management’s Discussion and Analysis of Financial Condition and Results of Operations” below~~5, ~~and elsewhere in this quarterly report~~2020, ~~are~~Driven ~~not related to historical results~~Deliveries, ~~and are forward-looking statements~~Inc. ~~Forward-looking statements present our expectations or forecasts of future events. You can identify these statements by~~ (the ~~fact~~“Company”) ~~that~~entered ~~they~~into ~~do not~~an ~~relate~~Agreement ~~strictly to historical or current facts. These statements involve known~~ and ~~unknown~~Plan ~~risks, uncertainties and other factors that may cause our actual results, levels~~ of ~~activity,~~Reorganization ~~performance~~(the or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements frequently are accompanied by such words such as “~~may,” “will,” “should,” “could,”~~Merger ~~“expects,~~Agreement”) ~~“plans,”~~among ~~“intends,”~~Stem ~~“anticipates~~Holdings,” ~~“believes~~Inc.,” ~~“estimates,” “predicts,”~~a ~~“potential”~~Nevada orcorporation (“~~continue,~~Parent”) orStem ~~the~~Driven ~~negative of such terms or other words and terms of similar meaning. Although we believe that the expectations reflected in the forward-looking statements are reasonable~~Acquisition, ~~we cannot guarantee future results, levels of activity, performance, achievements, or timeliness of such results~~Inc. ~~Moreover~~, ~~neither~~a ~~we nor~~Nevada ~~any~~corporation ~~other~~(“Acquisition ~~person~~Sub”) ~~assumes responsibility for the accuracy~~ and ~~completeness of such forward-looking statements. We are under no duty to update any of~~ the ~~forward-looking statements after the date of this quarterly report~~Company. Subsequent written and oral forward looking statements attributable to us or to persons acting in our behalf are expressly qualified in their entirety by the cautionary statements and risk factors set forth in our annual report on Form 10-K filed with the SEC on May 22, 2020, and in other reports filed by us with the SEC.

~~You~~Pursuant to the ~~should~~Merger ~~read~~Agreement, on the ~~following~~Effective ~~description~~Date (as defined in the Merger Agreement), Acquisition Sub shall be merged (the “Merger”) with and into the Company and shall become a wholly-owned subsidiary of ~~our~~Parent. ~~financial~~As ~~condition~~of the closing of the Merger, all of the Company’s outstanding shares shall be cancelled and ~~results~~converted into the shares of ~~operations~~the inParent ~~conjunction~~on ~~with~~a pro-rata basis at a ratio of one share of the ~~financial~~Parent ~~statements~~for every one share of the Company. Immediately prior to the closing of the Merger the Parent will issue to each holder of warrants, options or convertible debentures to purchase the Company’s shares, warrants, options and ~~accompanying~~convertible debentures ~~notes~~that ~~included~~are equal in ~~this~~value ~~report~~and on the same terms as the respective holder’s Company warrants, options and debentures. Additionally, certain outstanding debt of the Company will be converted into shares of the Company’s common stock in accordance with the Merger Agreement. Adam Berk, is the Parent’s Chief Executive Officer and President as well as a member of its board of directors. Mr. Berk is a member of the Company’s board of directors. Mr. Berk abstained from voting on the approval of the Merger during the Company’s board meeting at which the Merger was voted on.

~~Overview~~The Closing of the Merger is subject to customary closing conditions including (but not limited to):

We were incorporated in the State of Delaware on July 22, 2013 under the name Digital Commerce Solutions, Inc. and changed our name to Results-Based Outsourcing, Inc. on September 5, 2014. On August 29, 2018, Driven Deliveries, Inc., a Nevada company (~~“Driven Nevada”~~i)~~, was acquired by Results-Based Outsourcing as part of a reverse merger transaction. As consideration for the merger,~~ ~~Results-Based~~The ~~Outsourcing~~Merger ~~issued~~being ~~the~~approved ~~equity~~by ~~holders of Driven Nevada an aggregate of 30,000,000 post-split shares of their common stock. Following~~ the ~~merger, the~~ Company’s ~~adopted~~shareholders, the ~~business~~shareholders ~~plan~~ of ~~Driven~~Acquisition ~~Nevada as a delivery company focused on deliveries for consumers of legal cannabis products~~Sub, inand ~~California.~~the ~~The~~board ~~merger was accounted for as a recapitalization~~ of ~~the Company, therefore~~directors ~~the~~by ~~financial statements as presented in this report include~~ the ~~historical results of Driven Nevada.~~Parent;

~~On September 6, 2018, we amended our Certificate of Incorporation to~~ (~~i) changed our name to Driven Deliveries, Inc., (~~ii) ~~increase~~ ~~the~~The ~~number~~listing of ~~our~~the ~~authorized~~Consideration ~~shares~~Shares toshall ~~215,000,000,~~have ~~comprised~~been ofapproved ~~200,000,000~~by ~~shares of common stock, par value $0.0001 per share and 15,000,000 shares of “blank check” preferred stock, par value $0.0001 per share (~~the ~~“Preferred~~Canadian ~~Stock”) and~~Securities ~~(iii) to effect a forward split such that 12.35 shares of Common Stock were issued for every one (1) share of Common Stock issued and outstanding immediately prior to the amendment.~~Exchange;

On(iii) ~~January~~Any ~~24th,~~required ~~2019~~third-party weconsents ~~changed~~shall ~~our~~have ~~ticker~~been ~~symbol~~received; ~~to DRVD.~~and

In(iv) ~~June~~The ~~2019,~~Company weshall ~~completed~~have ~~our~~obtained ~~acquisition~~executed ofwaivers ~~Ganjarunner~~from Salvador Villanueva, ~~Inc.~~III, Jeanette Villanueva and ~~Global~~Lisa ~~Wellness,~~Chow ~~LLC,~~pursuant to which ~~are~~such ~~engaged~~parties inwaive their respective rights to re- purchase all of the ~~business~~assets of ~~providing delivery~~Budee, ~~services~~Inc. under the Agreement and Plan of ~~legal~~Merger ~~cannabis~~among ~~products~~the toCompany, ~~consumers~~Budee Acquisition, Inc. and Budee Inc., dated February 27, 2020.

~~In July~~Either ~~2019,~~the weCompany or ~~entered~~the ~~into~~Parent anmay ~~Asset~~terminate ~~Purchase~~the Merger Agreement ~~with~~if ~~Mountain High Recreation, Inc., in which~~ the ~~Company~~Merger ~~acquired~~has ~~certain assets~~not ~~from~~been ~~Mountain~~consummated ~~High~~by ~~Recreation~~December 31, ~~Inc~~2020.

InThe foregoing ~~September~~description ~~2019,~~of wethe ~~entered~~Merger ~~into~~Agreement adoes ~~Joint~~not ~~Venture~~purport ~~with~~to ~~Budee~~be complete, ~~Inc.~~and tois ~~expand~~qualified ~~our~~in ~~operations~~its ~~and~~entirety ~~engage~~by inreference to the ~~business~~full text of ~~providing delivery~~the ~~services~~Merger Agreement, a copy of ~~legal~~which ~~cannabis~~is ~~products~~filed as Exhibit 2.1 to ~~the~~this ~~consumer~~filing.

~~In February~~On ~~2020,~~October ~~we completed an acquisition of Budee~~4, 2020 ~~Inc~~Christian ~~which~~Schenk ~~allowed~~resigned usas ~~to consolidate all of~~ the ~~Budee,~~Company’s ~~Inc.~~Chief ~~revenue,~~Executive ~~expand our~~Officer ~~delivery operations,~~ and ~~unify~~as ~~our~~the ~~operations~~Chairman and ~~technology~~as ~~into~~ a ~~single,~~member ~~scalable,~~of ~~and~~the ~~supportable~~Company’s board ~~platform~~of ~~and infrastructure~~Directors.

On October 4, ~~April~~2020, 9Salvador Villanueva, ~~2020~~who ~~our~~is ~~common~~currently ~~stock~~serving ~~became~~as ~~quoted~~the onCompany’s President, was appointed the ~~OTCQB~~Company’s ~~under~~Interim Chief Executive Officer. Mr. Villanueva will continue to serve as the ~~symbol~~Company’s ~~DRVD~~President.

2825

~~Driven Overview~~Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation

~~Driven is~~Certain statements in ~~stock~~“Management’s Discussion and ~~on-time!~~Analysis ~~Founded~~of byFinancial ~~experienced~~Condition ~~technology,~~and ~~cannabis,~~Results ~~and~~of ~~logistics~~Operations” ~~executives~~below, ~~Driven~~and iselsewhere ~~one~~in ofthis ~~the~~quarterly ~~first licensed~~report, ~~United~~are ~~States~~not ~~Exchange-traded,~~related ~~online~~to ~~cannabis~~historical ~~retailer~~results, ~~that~~and isare ~~capable~~forward-looking ofstatements. ~~servicing~~Forward-looking ~~92%~~statements ofpresent ~~California’s~~our ~~adult population~~expectations inor ~~less~~forecasts ~~than~~of 90future ~~minutes~~events. WeYou ~~aim~~can toidentify ~~delight~~these ~~our~~statements ~~customers~~by ~~with~~ the ~~best~~fact ~~cannabis~~that ~~delivery~~they ~~experience~~do innot ~~the~~relate ~~industry.~~strictly ~~Utilizing~~to historical or ~~our~~current ~~own~~facts. ~~shipping~~These ~~hubs,~~statements ~~drivers,~~involve known and ~~proprietary~~unknown ~~technology~~risks, weuncertainties ~~delight~~and ~~our~~other ~~customers~~factors ~~with~~that amay ~~cannabis~~cause ~~delivery~~our ~~experience~~actual ~~that~~results, islevels ~~comparable~~of activity, performance or achievements to ~~some~~be materially different from any future results, levels of ~~the~~activity, ~~largest~~performance or ~~eCommerce~~achievements ~~retailers~~expressed inor ~~the~~implied ~~United~~by ~~States~~such forward-looking statements. ~~Driven~~Forward-looking ~~provides~~statements 2frequently ~~different~~are ~~service~~accompanied by ~~levels~~such towords ~~our~~such as “may,” “will,” “should,” “could,” “expects,” ~~customers.~~“plans,” An“intends,” “~~Express~~anticipates,” ~~delivery~~“believes,” ~~with~~“estimates,” a“predicts,” “potential” ~~limited~~or ~~product~~“continue,” ~~selection~~or the negative of such terms or other words and terms of similar meaning. Although we believe that ~~remains~~the ~~unsold~~expectations reflected in the ~~Driver’s~~forward-looking ~~vehicle~~statements are reasonable, we cannot guarantee future ~~usually~~results, ~~delivered~~levels ~~within~~of 90activity, ~~minutes~~performance, achievements, or ~~less~~timeliness of such results. Moreover, ~~and~~neither awe ~~“Next~~nor ~~Day”~~any ~~scheduled~~other ~~delivery~~person assumes ~~from~~responsibility for the ~~larger~~accuracy ~~selection~~and completeness of ~~500+ products~~such ~~from~~forward-looking astatements. ~~Driven~~We ~~fulfillment~~are ~~center.~~under ~~Currently,~~no ~~customers~~duty ~~are~~to ~~able~~update toany of ~~place~~the ~~online~~forward-looking ~~orders~~statements ~~from~~after ~~our~~the 2date ~~core~~of ~~brands,~~this ~~Budee and~~quarterly ~~Ganjarunner~~report. ~~Additionally,~~Subsequent wewritten ~~are~~and ~~participants~~oral forward looking statements attributable to us or to persons acting in ~~the~~our ~~growing~~behalf ~~cannabis~~are ~~ecosystem~~expressly byqualified ~~providing~~in ~~Brands~~their entirety by the ~~ability~~cautionary tostatements ~~transact~~and ~~with~~risk ~~their~~factors ~~customers~~set ~~using~~forth in our ~~technology~~annual report on Form 10-K filed with the SEC on May 22, 2020, and ~~platform~~in other reports filed by us with the SEC.

~~From humble~~You ~~beginnings~~should ~~less~~read ~~than~~the 3following ~~years ago, Driven Deliveries has grown into a company completing hundreds of thousands of deliveries~~description ~~per year with a customer base~~ of ~~over 200,000 legal cannabis consumers. Driven’s initial business was~~ our ~~“Dispensary to~~financial ~~Consumer”~~condition ~~program, where Driven would provide the vehicle, logistics,~~ and ~~infrastructure~~results ~~to complete deliveries on behalf~~ of ~~orders~~operations ~~processed~~in byconjunction ~~our~~with ~~partner dispensaries. The revenue from this model consisted of charging a commission to~~ the ~~dispensary based~~financial onstatements ~~the amount of the delivered order~~ and ~~miles~~accompanying ~~traveled.~~notes ~~However, due to changes in regulations, and despite continued technological~~included ~~innovation and investment, the “Dispensary to Consumer” business was ended~~ in Q1this ~~2020 to support our direct to consumer business~~report.

In the first quarter of 2019 Driven began its transformation in fundamental strategy by switching its core focus from “Dispensary to Consumer” to “Direct to Consumer”. The executive team at Driven determined that in order to compete and be successful in California, Driven had to directly service the customer and own the customer’s experience. Neither of these was possible in the “Dispensary to Consumer” model. As such Driven set out to build its own infrastructure to be able to transact and deliver directly to the cannabis consumer. The executive team began the process of buying and building this infrastructure.Overview

~~In February~~We ~~2019,~~were ~~Driven~~incorporated ~~entered~~in ~~into~~the aState ~~2-year~~of ~~Operating~~Delaware on ~~Agreement~~July ~~within~~22, ~~the~~2013 ~~joint~~under ~~venture~~the CAname ~~City~~Digital ~~Supply~~Commerce Solutions, ~~LLC~~Inc. inand anchanged ~~attempt~~our name to Results-Based Outsourcing, Inc. on September ~~gain~~5, ~~exposure~~2014. inOn aAugust ~~new~~29, ~~area~~2018, ~~and~~Driven ~~create~~Deliveries, Inc., a ~~location~~Nevada ~~for~~company ~~operations~~(“Driven ~~out~~Nevada”), was acquired by Results-Based Outsourcing as part of ~~California~~a ~~City,~~reverse CAmerger transaction. ~~Under~~As ~~Driven~~consideration ~~management~~for the merger, CAResults-Based ~~City~~Outsourcing issued the equity ~~Supply~~holders ~~was~~of ~~selected~~Driven asNevada 1an aggregate of 330,000,000 ~~licensee~~post-split ~~applicants~~shares toof ~~receive~~their acommon ~~non-storefront~~stock. ~~retail~~Following &the merger, the Company adopted the business plan of Driven Nevada as a delivery ~~license~~company infocused ~~April~~on deliveries for consumers of ~~2019. Unfortunately~~legal cannabis products, in ~~all~~California. ~~members~~The ofmerger ~~the~~was ~~LLC~~accounted ~~have~~for ~~opted~~as ~~out~~a recapitalization of the ~~Operating~~Company, ~~Agreement~~therefore ~~early~~the ~~and~~financial ~~Driven~~statements ~~has~~as ~~withdrawn~~presented in ~~from~~this ~~ownership due~~report toinclude ~~changes~~the inhistorical ~~local~~results ~~regulations~~of Driven Nevada.

~~In June~~On ~~2019,~~September ~~the Company acquired Ganjarunner~~6, ~~Inc~~2018, anwe ~~online~~amended ~~retailer~~our ~~based out~~ Certificate of ~~Sacramento~~Incorporation ~~with~~to a(i) ~~small~~changed ~~operation~~our inname ~~Los~~to ~~Angeles that~~Driven ~~focused~~Deliveries, onInc., ~~“Next~~(ii) ~~Day”~~increase ~~delivery~~the ~~from~~number aof ~~fulfillment~~our ~~center.~~authorized Inshares ~~addition~~ to ~~a functioning delivery operation~~215, ~~Ganjarunner~~000,000, ~~also~~comprised ~~came~~of ~~with~~200,000,000 ashares ~~substantial amount~~ of ~~data~~common ~~and~~stock, ~~intelligence~~par onvalue ~~the cannabis consumers they had been servicing with cannabis delivery for 5 plus years~~$0.0001 ~~Ganjarunner~~per ~~was~~share ~~focused~~and on15,000,000 ashares ~~more~~of ~~sophisticated~~“blank ~~consumer with its target audiences falling between 30 and 55~~check” ~~years~~preferred ofstock, ~~age~~par ~~and~~value ~~professionally~~$0.0001 ~~employed~~per ~~who~~share ~~wanted~~(the ~~specific~~“Preferred ~~products~~Stock”) and ~~brands~~(iii) ~~and were willing~~ to ~~wait~~effect ~~for~~a ~~them~~forward tosplit besuch ~~delivered~~that ~~the next day~~12.35 ~~Ganjarunner~~shares ~~used~~of aCommon ~~heavily~~Stock ~~modified~~were ~~commercially~~issued ~~available~~for ~~eCommerce~~every ~~solution~~one (~~WooCommerce~~1) toshare ~~complete~~of ~~the~~Common ~~next day~~Stock ~~deliveries~~issued ~~throughout~~and ~~the~~outstanding ~~state~~immediately ofprior ~~California~~to the amendment.

~~Simultaneously, the~~On ~~Company~~January ~~worked to find an online retailer specializing in the “Express” cannabis delivery market. To continue planned growth in California~~24th, ~~Driven acquired certain assets of Mountain High Recreation to include the brand & talent in July~~ 2019. ~~The~~we ~~“Express”~~changed ~~cannabis~~our ~~consumer is markedly different from the “Next Day” cannabis consumer~~ticker assymbol ~~“Express” customers are typically not brand conscious and are looking for “cheap weed fast.” Thus, an express provider is able~~ to ~~complete its deliveries faster but also at a lower price point and lower order total~~DRVD.

29In June 2019, we completed our acquisition of Ganjarunner, Inc. and Global Wellness, LLC, which are engaged in the business of providing delivery services of legal cannabis products to consumers.

In ~~August~~ July 2019, ~~with~~we ~~the~~entered ~~Ganjarunner~~into ~~acquisition~~an ~~and~~Asset Purchase ~~the~~Agreement with Mountain High ~~asset purchases complete~~Recreation, ~~we began to combine Express deliveries with Next Day using a single technology and operations infrastructure~~Inc. ~~With this combination~~, ~~cannabis~~in ~~consumers~~which ~~are given a higher level of service as they can choose Express or Next Day delivery while shopping online. Additionally,~~ the Company ~~sees~~acquired ~~increased operational~~certain ~~efficiencies~~assets asfrom aMountain ~~single~~High ~~driver can complete both types of deliveries~~Recreation, Inc.

In ~~early~~ September 2019, ~~Driven~~we entered into a Joint Venture with Budee, Inc. ato ~~large~~expand ~~on-demand~~our retailer based out of Oakland, California. Budee, Inc had been operating in the cannabis delivery space in California since 2015. Focusing exclusively on growing and streamlining its Express cannabis delivery operations, Budee became increasingly frustrated with the ability for commercial software to support the express delivery model that was compliant with state regulations. As such, Budee developed its own proprietary Budee Inventory Management System, eCommerce system, Driver application, and ~~back-office~~engage ~~system.~~in ~~The proprietary software combined with a relentless focus on margin improvement allowed Budee to scale throughout California. During~~ the ~~integration~~business of ~~Ganjarunner~~providing ~~and~~delivery ~~Mountain~~services ~~High, plus the combination~~ of ~~the~~legal ~~Express and Next Day delivery options, Driven executive management was arriving at the same conclusion~~cannabis ~~that~~products ~~Budee had arrived at: custom software and infrastructure would be required~~ to ~~scale. By establishing a joint venture with Budee, we were able to take advantage of reviewing~~ the ~~software platform and determining if it would work for our operations~~consumer.

~~Throughout the~~In ~~first~~February ~~quarter of~~ 2020, ~~the~~we ~~Company~~completed ~~continued~~an ~~to execute on its growth plans within the State of California. Significant improvements~~acquisition ~~were seen in the financial performance~~ of ~~the online retail businesses Ganjarunner and~~ Budee~~. Driven by the addition of over 13~~,~~000 new~~ ~~consumers~~Inc towhich ~~the~~allowed ~~platform,~~us ~~more than 18 new cannabis brands were added~~ to ~~the~~consolidate ~~menu~~all ~~and continued development~~ of the ~~delivery network~~Budee, ~~across the State~~Inc. ~~Fueling~~revenue, ~~these~~expand ~~accomplishments~~our ~~were~~delivery ~~improvements~~operations, toand ~~the~~unify ~~majority~~our ~~of the marketing metrics including new~~operations ~~customer~~and ~~cost~~technology ofinto ~~acquisition~~a ~~(COA)~~single, ~~existing customer retention~~scalable, ~~customer~~and ~~ratings,~~supportable ~~menu~~platform ~~reviews,~~and ~~as well as continued automation of the Company’s marketing segments which contributed to the success~~infrastructure.

~~In mid~~On ~~March~~April 9, 2020 ~~the~~our ~~Company’s~~common ~~retail~~stock ~~divisions saw major increases in demand resulting from the shelter-in-place orders issued~~became ~~across~~quoted ~~the~~on ~~State of California. Sales effectively doubled during~~ the ~~second~~OTCQB ~~half~~under ~~of March 2020. The technology and marketing infrastructure that was developed internally then implemented made it possible for Driven to capture~~ the ~~increased~~symbol ~~business while maintaining existing operating costs~~DRVD.

In April of 2020 the Company launched is Brand Budee program. This program extends the Driven’s cannabis delivery network to partner brands who can now sell their legal cannabis products directly to their consumers on their own website. The solution brings the same online shopping experience for both cannabis brands selling their products and cannabis consumers looking for delivery. At the close of this quarter, our Brand Budee program had converted 2,355 new customers and generated 2,516 orders.26

In June of 2020 the company executed an agreement with Stem Holdings, Inc. (OTCQB: STMH CSE: STEM) a leading vertically-integrated cannabis cultivation, processing, extraction, retail, and distribution provider to collaborate on e-commerce and distribution. This pilot launched Driven’s ~~Delivery as a Service model with Stem Holdings’ full-service medical dispensary, Foothill Health & Wellness, which services the El Dorado County and the suburbs of Sacramento.~~Overview

~~Recent~~Driven is in stock and on-time! Founded ~~developments~~by experienced technology, cannabis, and logistics executives, Driven is one of the first licensed, United States Exchange-traded, online cannabis retailer that is capable of servicing 92% of California’s adult population in less than 90 minutes. We aim to delight our customers with the best cannabis delivery experience in the industry. Utilizing our own shipping hubs, drivers, and proprietary technology, we delight our customers with a cannabis delivery experience that is comparable to some of the largest eCommerce retailers in the United States. Driven provides 2 different service levels to our customers. An “Express” delivery with a limited product selection that remains unsold in the Driver’s vehicle usually delivered within 90 minutes or less, and a “Next Day” scheduled delivery from the larger selection of 500+ products from a Driven fulfillment center. Currently, customers are able to place online orders from our 2 core brands, Budee and Ganjarunner. Additionally, we are participants in the growing cannabis ecosystem by providing Brands the ability to transact with their customers using our technology and platform.

~~On February~~From 27humble beginnings less than 3 years ago, ~~2020~~Driven ~~the~~Deliveries ~~Company~~has ~~completed~~grown ~~its~~into ~~acquisition~~a company completing hundreds of ~~Budee~~thousands of deliveries per year with a customer base of over 200,000 ~~Inc~~legal cannabis consumers. ~~which~~Driven’s ~~allowed~~initial usbusiness towas ~~consolidate~~our ~~all~~“Dispensary ofto ~~the~~Consumer” ~~Budee~~program, ~~Inc.~~where ~~revenue,~~Driven ~~expand~~would ~~our~~provide ~~delivery~~the ~~operations~~vehicle, logistics, and ~~unify~~infrastructure to complete deliveries on behalf of orders processed by our ~~operations~~partner dispensaries. ~~and~~The ~~technology~~revenue ~~into~~from this model consisted of charging a ~~single~~commission to the dispensary based on the amount of the delivered order and miles traveled. However, ~~scalable~~due to changes in regulations, and ~~supportable~~despite ~~platform~~ continued technological innovation and ~~infrastructure~~investment, the “Dispensary to Consumer” business was ended in Q1 2020 to support our direct to consumer business.

~~On March~~In ~~20,~~the ~~2020,~~first ~~Governor~~quarter ~~Gavin~~of ~~Newsom~~2019 ~~and~~Driven ~~the~~began its ~~California~~transformation ~~Bureau~~in offundamental ~~Cannabis~~strategy ~~Control~~by ~~identified~~switching ~~cannabis~~its ~~companies~~core asfocus from “~~essential~~Dispensary to Consumer” to “Direct to Consumer”. The executive team at Driven determined that in ~~the~~order ~~State~~to ofcompete and be successful in California, Driven had to directly service the customer and asown the customer’s experience. Neither of these was possible in the “Dispensary to Consumer” model. As such weDriven ~~continued~~set out to ~~operate~~build ~~through~~its ~~the~~own ~~shelter~~infrastructure into ~~place~~be ~~order~~able ~~due~~to transact and deliver directly to the cannabis consumer. The executive team began the ~~COVID-19~~process ~~pandemic~~of buying and building this infrastructure.

~~Financial~~In February 2019, Driven entered into ~~Results~~a 2-year Operating Agreement within the joint venture CA City Supply, LLC in an attempt to gain exposure in a new area and create a location for operations out of California City, CA. Under Driven management, CA City Supply was selected as 1 of 3 licensee applicants to receive a non-storefront retail & delivery license in April of 2019. Unfortunately, all members of the LLC have opted out of the Operating Agreement early and Driven has withdrawn from ownership due to changes in local regulations.

WeIn ~~have~~June a2019, ~~limited~~the ~~operating~~Company ~~history.~~acquired ~~Therefore~~Ganjarunner, ~~there~~Inc, isan ~~limited~~online ~~historical~~retailer ~~financial~~based ~~information~~out ~~upon~~of ~~which~~Sacramento towith ~~base~~a ansmall ~~evaluation~~operation ofin ~~our~~Los ~~performance.~~Angeles ~~Our~~that ~~prospects~~focused ~~must~~on be“Next ~~considered~~Day” delivery infrom ~~light~~a offulfillment ~~the~~center. ~~uncertainties,~~In ~~risks,~~addition ~~expenses,~~to ~~and~~a ~~difficulties~~functioning ~~frequently~~delivery ~~encountered~~operation, byGanjarunner ~~companies~~also incame ~~their~~with ~~early~~a ~~stages~~substantial amount of ~~operations.~~data ~~Our~~and ~~financials~~intelligence ~~for~~on the ~~six~~cannabis ~~months~~consumers ~~ended~~they ~~June~~had ~~30,~~been ~~2020,~~servicing ~~show~~with acannabis ~~net~~delivery ~~loss~~for of5 ~~$7,466,991~~plus years. WeGanjarunner ~~expect~~was focused toon ~~incur~~a ~~additional net~~more ~~expenses~~sophisticated ~~over~~consumer ~~the~~with ~~next~~its ~~several~~target audiences falling between 30 and 55 years asof weage ~~continue~~and professionally employed who wanted specific products and brands and were willing to ~~expand~~wait ~~our~~for ~~existing~~them ~~operations.~~to ~~The~~be ~~amount~~delivered ofthe ~~future~~next ~~losses~~day. ~~and~~Ganjarunner ~~when,~~used a heavily ifmodified ~~ever,~~commercially weavailable ~~will~~eCommerce ~~achieve~~solution ~~profitability~~(WooCommerce) ~~are~~to ~~uncertain~~complete the next day deliveries throughout the state of California.

30Simultaneously, the Company worked to find an online retailer specializing in the “Express” cannabis delivery market. To continue planned growth in California, Driven acquired certain assets of Mountain High Recreation to include the brand & talent in July 2019. The “Express” cannabis consumer is markedly different from the “Next Day” cannabis consumer as “Express” customers are typically not brand conscious and are looking for “cheap weed fast.” Thus, an express provider is able to complete its deliveries faster but also at a lower price point and lower order total.

~~Results~~In August 2019, with the Ganjarunner acquisition and the Mountain High asset purchases complete, we began to combine Express deliveries with Next Day using a single technology and operations infrastructure. With this combination, cannabis consumers are given a higher level of ~~Operations~~service as they can choose Express or Next Day delivery while shopping online. Additionally, the Company sees increased operational efficiencies as a single driver can complete both types of deliveries.

~~Results of Operations for the Three and Six Months Ended June 30, 2020 compared to Three and Six Months Ended June 30, 2019.~~27

~~Revenue~~In early September 2019, Driven entered into a Joint Venture with Budee, Inc. a large on-demand retailer based out of Oakland, California. Budee, Inc had been operating in the cannabis delivery space in California since 2015. Focusing exclusively on growing and streamlining its Express cannabis delivery operations, Budee became increasingly frustrated with the ability for commercial software to support the express delivery model that was compliant with state regulations. As such, Budee developed its own proprietary Budee Inventory Management System, eCommerce system, Driver application, and back-office system. The proprietary software combined with a relentless focus on margin improvement allowed Budee to scale throughout California. During the integration of Ganjarunner and Mountain High, plus the combination of the Express and Next Day delivery options, Driven executive management was arriving at the same conclusion that Budee had arrived at: custom software and infrastructure would be required to scale. By establishing a joint venture with Budee, we were able to take advantage of reviewing the software platform and determining if it would work for our operations.

~~During~~Throughout the ~~six~~first ~~months~~quarter ~~ended~~of ~~June 30,~~ 2020, the Company ~~recorded~~continued ~~revenue~~to inexecute ~~the~~on ~~amount~~its ofgrowth ~~$7,867,753.~~plans ~~The~~within ~~revenue for~~ the ~~period~~State ~~ended June 30, 2020 was comprised~~ of ~~product sales of $7,848,238, and dispensary delivery income of $19,515~~California. ~~This~~Significant ~~left~~improvements ~~the~~were ~~Company~~seen ~~with~~in ~~a gross profit of $417,298 for~~ the ~~six~~ ~~months~~financial ~~ended~~performance ~~June 30, 2020. The Company had revenue~~ of ~~$46,407 during~~ the ~~six~~online ~~months~~retail ~~ended~~businesses ~~June~~Ganjarunner ~~30,~~and ~~2019~~Budee. ~~The~~Driven ~~revenue~~by ~~for~~ the ~~period ended~~addition ~~June 30, 2019 was comprised~~ of ~~dispensary~~over ~~cost reimbursements of $63~~13,~~346~~000 ~~offsetting~~new consumers to the ~~dispensary delivery income of $34~~platform,~~343 and~~ ~~product~~more ~~sales~~than of18 ~~$62,607.~~new ~~The~~cannabis ~~change~~brands inwere ~~revenue~~added ~~between~~to the ~~three~~menu ~~months ended June 30, 2020,~~ and ~~2019~~continued ~~resulted~~development ~~from~~of the ~~Company’s pivot~~delivery tonetwork across the aState. ~~direct~~Fueling tothese ~~consumer~~accomplishments ~~cannabis~~were ~~retail~~improvements ~~business~~to ~~delivery~~the ~~service~~majority ~~through~~of the ~~acquisition~~marketing ofmetrics ~~Ganjarunner~~including onnew ~~June~~customer ~~24 2019,~~cost ~~the~~of acquisition of(COA), ~~Budee~~existing oncustomer ~~February 27~~retention, ~~2020.~~customer ~~The~~ratings, ~~Company’s~~menu ~~dispensary-to-consumer delivery service was discontinued on March 31~~reviews, ~~2020.~~as ~~Higher~~well ~~sales~~as ~~volume~~continued ~~was~~automation ~~also~~of ~~driven by organic growth initiatives as~~ the Company ~~expanded its~~ ’s marketing ~~initiatives,~~ segments which ~~led~~contributed to ~~increases in~~ the ~~number of orders completed order~~success.

~~During~~In ~~the~~mid ~~three~~March ~~months ended June 30,~~ 2020, the Company’s retail ~~recorded~~divisions ~~revenue~~saw inmajor ~~the~~increases ~~amount~~in ofdemand ~~$5,672,305.~~resulting ~~The~~from ~~revenue for~~ the ~~period~~shelter-in-place ~~ended~~orders ~~June~~issued ~~30,~~across ~~2020 was comprised of product sales of $5,626,541. This left~~ the ~~Company~~State ~~with a negative gross profit~~ of ~~$73,763 for the three months ended June 30, 2020~~California. Sales ~~The~~effectively ~~Company~~doubled ~~had revenue of $65,824~~ during the ~~three~~second ~~months~~half ~~ended June 30, 2019. The revenue for the period ended June 30, 2019 was comprised~~ of ~~dispensary~~March ~~cost reimbursements of $28,559 offsetting the dispensary delivery income of $18,973 and product sales of $62,607~~2020. The ~~change~~technology ~~in revenue between the three months ended June 30, 2020,~~ and ~~2019~~marketing ~~resulted~~infrastructure ~~from~~that ~~the~~was ~~Company expanding~~developed ~~its~~internally ~~operations~~then ~~and~~implemented ~~acquisition~~made ofit ~~Ganjarunner~~possible infor ~~2019,~~Driven ~~the acquisition of Budee in 2020, and the Company’s pivot~~ to ~~the~~capture ~~a direct to consumer delivery service and~~ the ~~acquisition~~increased ofbusiness ~~other~~while ~~cannabis~~maintaining ~~delivery~~existing ~~services~~operating costs.

~~Our primary~~In ~~source~~April of ~~revenue~~2020 inthe Q1Company ~~and~~launched is Q2Brand ofBudee ~~2019~~program. ~~was~~This ~~from~~program extends the ~~dispensary~~Driven’s tocannabis ~~consumer~~ delivery ~~service.~~network ~~However,~~to ~~during~~partner Q3brands ~~and~~who ~~Q4 of~~can ~~2019~~now ~~the~~sell ~~Company~~their legal ~~transitioned to delivery of~~ cannabis products directly to their consumers ~~with~~on ~~the~~their ~~acquisition~~own ~~of Ganjarunner, Inc~~website. ~~From~~ ~~January~~The 1,solution ~~2019~~brings ~~through~~the ~~June~~same ~~24,~~online ~~2019~~shopping ~~Ganjarunner,~~experience for ~~Inc.~~both ~~operated~~cannabis ~~independently~~brands ofselling ~~DRVD.~~their Onproducts ~~June~~and ~~24,~~cannabis ~~2019~~consumers ~~DRVD~~looking ~~acquired~~for ~~Ganjarunner Inc~~delivery. ~~and~~At the ~~results~~close of ~~operations~~this ~~from~~quarter, ~~January~~our Brand 1,Budee ~~2019~~program tohad ~~June~~converted 232,355 ~~2019~~new iscustomers ~~not~~and ~~included~~generated ~~in the Company’s financial reporting. However~~2,516 ~~revenue from June 24, 2019 forward is included in the Company’s financial~~orders.

~~On July~~In ~~10,~~June ~~2019~~of ~~DRVD~~2020 ~~acquired~~ the ~~certain~~company ~~assets~~executed ofan agreement ~~Mountain~~with ~~High~~Stem ~~Recreation~~Holdings, Inc. ~~The~~(OTCQB: ~~asset~~STMH ~~purchase~~CSE: ~~was~~STEM) ~~designed~~a toleading ~~add~~vertically-integrated ~~Mountain~~cannabis ~~High Recreation’s~~cultivation, ~~Express~~processing, ~~delivery~~extraction, retail, onand ~~top~~distribution ofprovider ~~Ganjarunner’s~~to ~~Next~~collaborate ~~Day~~on ~~delivery~~e-commerce ~~service~~and distribution. ~~Since~~This ~~MHR~~pilot ~~was~~launched anDriven’s ~~asset~~Delivery ~~purchase,~~as ~~its~~a ~~post~~Service ~~asset~~model ~~purchase~~with ~~revenues~~Stem ~~are~~Holdings’ ~~included~~full-service inmedical ~~this report as a part of Ganjarunner~~dispensary, ~~Inc.~~Foothill OnHealth ~~October~~& 3Wellness, ~~2019~~which weservices ~~entered into~~the aEl ~~joint~~Dorado ~~venture~~County ~~with~~and ~~Budee, Inc. to re-establish~~ the ~~Southern~~suburbs ~~California operations~~ of ~~Budee out of our Los Angeles facility~~Sacramento.

~~On February~~Recent 27, 2020 DRVD acquired Budee, Inc and the revenue from Budee, Inc. from February 28, 2020 forward is included in this report. With the acquisition of Budee, Inc. the joint venture with Budee, Inc. was ended on February 27, 2020.developments

~~The Company~~On ~~has~~February ~~combined Ganjarunner~~27, ~~Inc.,~~2020 the ~~assets~~Company ofcompleted its ~~Mountain~~acquisition ~~High~~of ~~Recreation, and~~ Budee, Inc. ~~into~~which aallowed ~~single~~us ~~operating~~to ~~entity responsible~~consolidate ~~for~~ all of the ~~Company’s~~Budee, ~~direct~~Inc. torevenue, ~~consumer~~expand ~~cannabis~~our delivery operations~~. The operational and technology integrations of these separate entities was more difficult than expected. In addition to the ordinary challenges of implementing standard operating procedures~~, ~~uniform accounting processes,~~ and ~~standardizing~~unify ~~and~~our ~~building~~operations ~~technology platforms, we also had to navigate extremely complex rules~~ and ~~regulations guiding the sale of cannabis from the California Bureau of Cannabis Control. We learned that customers are sensitive to not only front-end~~ technology ~~interfaces~~into ~~but~~a ~~also~~single, ~~operational~~scalable, and ~~delivery~~supportable ~~hiccups.~~platform ~~The entirety of the first quarter was dedicated to integrating these companies~~ and ~~putting the proper~~ infrastructure ~~in place~~.

31On March 20, 2020, Governor Gavin Newsom and the California Bureau of Cannabis Control identified cannabis companies as “essential” in the State of California and as such we continued to operate through the shelter in place order due to the COVID-19 pandemic.

~~Gross Profit~~Financial Results

~~During~~We ~~the~~have ~~six~~a ~~months~~limited ~~ended~~operating ~~June~~history. 30Therefore, ~~2020,~~ wethere ~~incurred~~is ~~gross~~limited ~~profit~~historical financial information upon which to base an evaluation of ~~$417,298~~our performance. ~~This~~Our isprospects ~~due~~must tobe ~~revenue~~considered in light of $7the uncertainties,~~867~~ risks,~~753~~ expenses, and ~~Cost~~difficulties offrequently ~~Sales~~encountered –by ~~Product~~companies ~~Costs~~in their early stages of ~~$3,597,269~~operations. ~~and~~Our ~~Cost~~financials offor ~~Sales~~the –nine ~~Fulfilment~~months ~~Costs~~ended ofSeptember $330,~~853~~ 2020,~~186~~ ~~for~~show a ~~total~~net ~~Cost~~loss of ~~Goods~~$14,769,942. ~~Sold~~We expect to incur additional net expenses over the next several years as we continue to expand our existing operations. The amount of $7future losses and when,~~450~~ if ever,~~455~~ we will achieve profitability are uncertain.

During the six months ended June 30, 2019, we incurred gross profit loss of ($1,987). This is due to revenue of $46,407 and Cost of Sales – Product Costs of $29,700 and Cost of Sales – Fulfilment Costs of $18,694 for a total Cost of Goods Sold of $48,394.28

~~Product costs:~~Results ~~Product costs include the purchase price~~ of ~~products sold, which include direct and indirect labor costs, rent, and depreciation expenses, and inbound shipping and handling costs for inventory.~~Operations

~~Fulfillment~~Results of ~~costs~~Operations ~~and~~for ~~other:~~the ~~includes~~Three ~~the~~and ~~costs~~Nine ofMonths ~~outbound~~Ended ~~shipping~~September ~~and~~30, ~~handling~~2020 ~~and~~compared ~~other~~to ~~costs~~Three ~~related~~and toNine ~~delivering~~Months ~~products~~Ended toSeptember ~~the~~30, ~~customer~~2019.

~~The Company’s Gross Profit for June 30, 2020 and 2019 are as follows:~~Revenue

Gross Profit	Six months ended June 30, 2020		Six months ended June 30, 2019
Revenue	$	7,867,753	$	46,407
Cost of Sales – Product Costs		3,597,269		29,700
Cost of Sales – Fulfilment Costs and Other		3,853,186		18,694
Total Cost of Goods Sold	$	7,450,455	$	48,394
Gross Profit	$	417,298	$	(1,987	)

During the nine months ended September 30, 2020, the Company recorded revenue in the amount of $13,847,628. The revenue for the period ended September 30, 2020 was comprised of product sales of $13,828,113, and dispensary delivery income of $19,515. This left the Company with a negative gross profit of $1,573,025 for the nine months ended September 30, 2020. The Company had revenue of $1,259,070 during the nine months ended September 30, 2019. The revenue for the period ended September 30, 2019 was comprised of dispensary cost reimbursements of $99,353 offsetting the dispensary delivery income of $87,869 and product sales of $1,270,554. The change in revenue between the nine months ended September 30, 2020, and 2019 resulted from the Company’s pivot to the a direct to consumer cannabis retail business delivery service through the acquisition of Ganjarunner on June 24 2019, the acquisition of Budee on February 27, 2020. The Company’s dispensary-to-consumer delivery service was discontinued on March 31, 2020. Higher sales volume was also driven by organic growth initiatives as the Company expanded its marketing initiatives, which led to increases in the number of orders completed order.

During the three months ended ~~June~~ September 30, 2020, wethe ~~incurred~~Company ~~gross~~recorded ~~profit~~revenue ~~loss~~in the amount of ($735,~~763)~~979,875. ~~This~~The isrevenue ~~due~~for tothe ~~revenue~~period ended September 30, 2020 was comprised of product sales of $5,~~972~~979,~~305~~875. ~~and~~This ~~Cost~~left ofthe ~~Sales~~Company –with ~~Product~~a ~~Costs~~ negative gross profit of $21,~~485~~990,~~730~~323 ~~and~~for ~~Cost~~the ofthree ~~Sales~~months –ended ~~Fulfilment~~September 30, ~~Costs~~2020. The Company had revenue of $31,~~260~~212,~~338~~663 during the three months ended September 30, 2019. The revenue for athe ~~total~~period ~~Cost~~ended September 30, 2019 was comprised of ~~Goods~~dispensary ~~Sold~~cost reimbursements of $536,~~746~~007 offsetting the dispensary delivery income of $53,~~068~~496 and product sales of $1,198,663. The change in revenue between the three months ended September 30, 2020, and 2019 resulted from the Company expanding its operations and acquisition of Ganjarunner in 2019, the acquisition of Budee in 2020, and the Company’s pivot to the a direct to consumer delivery service and the acquisition of other cannabis delivery services.

~~During~~Our primary source of revenue in Q1 and Q2 of 2019 was from the ~~three~~dispensary ~~months~~to ~~ended~~consumer ~~June~~delivery ~~30,~~service. ~~2019~~However, weduring ~~incurred~~Q3 ~~gross~~and ~~profit~~Q4 of ~~$17,340.~~2019 ~~This~~the isCompany ~~due~~transitioned to delivery ~~revenue~~of cannabis products directly to consumers with the acquisition of ~~$65~~Ganjarunner,~~824~~ ~~and~~Inc. ~~Cost~~From ofJanuary ~~Sales~~1, 2019 through June –24, ~~Product~~2019 ~~Costs~~Ganjarunner, Inc. operated independently of ~~$29~~DRVD. On June 24,~~700~~ 2019 DRVD acquired Ganjarunner Inc. and ~~Cost~~the results of operations ~~Sales~~from –January ~~Fulfilment~~1, ~~Costs~~2019 ofto ~~$18~~June 23,~~694~~ ~~for~~2019 ais ~~total~~not ~~Cost~~included ofin ~~Goods~~the ~~Sold~~Company’s offinancial ~~$48~~reporting. However,~~394~~ revenue from June 24, 2019 forward is included in the Company’s financial.

Gross Profit	Three months ended June 30, 2020			Three months ended June 30, 2019
Revenue	$	5,972,305		$	65,824
Cost of Sales – Product Costs		2,485,730			29,700
Cost of Sales – Fulfilment Costs and Other		3,260,338			18,694
Total Cost of Goods Sold	$	5,746,068		$	48,394
Gross Profit	$	(73,763	)	$	17,340

On July 10, 2019 DRVD acquired the certain assets of Mountain High Recreation. The asset purchase was designed to add Mountain High Recreation’s Express delivery on top of Ganjarunner’s Next Day delivery service. Since MHR was an asset purchase, its post asset purchase revenues are included in this report as a part of Ganjarunner, Inc. On October 3, 2019 we entered into a joint venture with Budee, Inc. to re-establish the Southern California operations of Budee out of our Los Angeles facility.

~~Operating~~On February 27, 2020 DRVD acquired Budee, ~~Expenses~~Inc and the revenue from Budee, Inc. from February 28, 2020 forward is included in this report. With the acquisition of Budee, Inc. the joint venture with Budee, Inc. was ended on February 27, 2020.

~~During~~The Company has combined Ganjarunner, Inc., the ~~six~~assets ~~months~~of ~~ended~~Mountain ~~June~~High 30Recreation, ~~2020~~and Budee, we ~~incurred~~Inc into a ~~loss~~single ~~from~~operating ~~operations~~entity responsible for all of ~~$5,709,316~~the Company’s direct to consumer cannabis delivery operations. ~~This~~The isoperational ~~due~~and technology integrations of these separate entities was more difficult than expected. In addition to ~~professional~~the ~~fees~~ordinary challenges of ~~$847~~implementing standard operating procedures,~~178~~ uniform accounting processes, ~~compensation~~and ofstandardizing $2and building technology platforms,~~794,702~~ ~~including~~we also had to navigate extremely complex rules and regulations ~~stock-based~~guiding ~~compensation~~the sale of ~~$1,080,701,~~cannabis ~~general~~from ~~and~~the ~~administrative~~California Bureau of ~~$2,023,364~~Cannabis ~~and~~Control. ~~sales~~We learned that customers are sensitive to not only front-end technology interfaces but also operational and ~~marketing~~delivery hiccups. The entirety of ~~$461,370~~the first quarter was dedicated to integrating these companies and putting the proper infrastructure in place.

During the six months ended June 30, 2019, we incurred a loss from operations of $2,514,219. This is due to professional fees of $508,870, compensation of $1,496,653 including stock-based compensation of $971,633, general and administrative of $413,432 and sales and marketing of $93,277.29

~~During~~Gross the three months ended June 30, 2020, we incurred a loss from operations of $3,123,512. This is due to professional fees of $396,563, compensation of $1,435,698 including stock-based compensation of $971,633, general and administrative of $936,871 and sales and marketing of $280,617.Profit

During the ~~three~~nine months ended ~~June~~ September 30, ~~2019~~2020, we incurred a ~~loss~~negative ~~from~~gross ~~operations~~profit of $1,~~570~~573,~~224~~025. This is due to ~~professional~~revenue ~~fees~~ of $~~341~~13,~~133~~847, ~~compensation~~628 ofand ~~$959,470~~Cost ~~including~~of ~~stock-based~~Sales ~~compensation~~– Product Costs of $~~623~~6,~~939~~195,462 ~~general~~and Cost of Sales – Fulfilment Costs and ~~administrative~~other of $~~234~~9,~~568~~225,191 ~~and~~for ~~sales~~a ~~and marketing~~total Cost of Goods Sold of $5215,~~503~~420,653.

32During the nine months ended September 30, 2019, we incurred a gross profit loss of $654,901. This is due to revenue of $1,259,070 and Cost of Sales – Product Costs of $458,239 and Cost of Sales – Fulfilment Costs of $145,930 for a total Cost of Goods Sold of $604,169.

~~The cost~~Product tocosts: ~~operationally~~Product ~~integrate~~costs ~~and~~include the ~~inefficiencies created by having multiple redundant personnel, drivers, routes, vehicles,~~ ~~software,~~purchase ~~and~~price ~~marketing were higher than forecasted. By the middle~~ of Q4products ofsold, ~~2019~~which ~~and~~include ~~into~~direct ~~Q1 of 2020 we worked to remove redundancies~~ and ~~operational~~indirect ~~overhead~~labor tocosts, ~~streamline~~rent, ~~processes~~ and ~~the~~depreciation ~~Company~~expenses, ~~did not start to realize the savings~~ and ~~efficiencies~~inbound ~~until the~~shipping ~~last~~and ~~month~~handling ofcosts ~~Q1 2020. The cost of being public created significant additional professional services fees~~ for ~~both legal, audit, and accounting services to support not only the Company but also the acquisition targets~~inventory.

~~Compensation~~Fulfillment costs and other: includes the costs of outbound shipping and handling and other costs related to delivering products to the customer.

The Company’s ~~compensation~~Gross Profit for ~~the six~~September ~~months June~~ 30, 2020 and 2019 are as follows:

Compensation Type	Six months ended June 30, 2020			Six months ended June 30, 2019
Gross Profit	Nine months ended September 30, 2020			Nine months ended September 30, 2019
Salary and Wages	$	1,714,001		$	525,020
Revenue	$	13,847,628		$	1,259,070
Stock Option and Warrant Compensation		1,080,701			971,633
Cost of Sales – Product Costs		6,195,462			458,239
Total Compensation	$	2,794,702		$	1,496,653
Cost of Sales – Fulfilment Costs and Other		9,572,191			145,930
Total Cost of Goods Sold	$	15,420,653		$	604,169
Gross Profit	$	(1,573,025	)	$	654,901

~~The~~During ~~Company’s compensation for~~ the three months ~~June~~ended September 30, 2020, we incurred a gross profit loss of $1,990,232. This is due to revenue of $5,979,875 and ~~2019~~Cost ~~are~~of asSales ~~follows:~~– Product Costs of $2,598,193 and Cost of Sales – Fulfilment Costs of $5,372,005 for a total Cost of Goods Sold of $7,970,198.

Compensation Type	Three months ended June 30, 2020		Three months ended June 30, 2019
Salary and Wages	$	752,897	$	623,939
Stock Option and Warrant Compensation		682,801		335,531
Total Compensation	$	1,435,698	$	959,470

During the three months ended September 30, 2019, we incurred gross profit of $656,888. This is due to revenue of $1,212,663 and Cost of Sales – Product Costs of $458,239 and Cost of Sales – Fulfilment Costs of $97,536 for a total Cost of Goods Sold of $555,775.

These amounts only include compensation found in the compensation line item on the statement of operations and does not include compensation recorded to cost of sales.

Gross Profit	Three months ended September 30, 2020			Three months ended September 30, 2019
Revenue	$	5,979,875		$	1,212,663
Cost of Sales – Product Costs		2,598,193			458,239
Cost of Sales – Fulfilment Costs and Other		5,372,005			97,536
Total Cost of Goods Sold	$	7,970,198		$	555,775
Gross Profit	$	(1,990,323	)	$	656,888

~~The increase in salaries and wages from June~~ 30~~, 2019 to June 30, 2020 was due to the merges with Ganjarunner and Budee.~~

~~Other~~ Operating Expenses

During the ~~six~~nine months ended ~~June~~ September 30, 2020, ~~the~~ ~~Company~~we incurred ~~interest~~a ~~expense~~loss from operations of $~~586~~13,~~793~~537,845. ~~which~~This ~~was~~is ~~comprised~~due ofto anprofessional ~~accrued~~fees ~~interest expense~~ of $~~118~~1,~~601~~261,084, ~~and~~compensation ~~a debt discount~~ of $~~364~~5,~~227~~643,563 including astock-based ~~loss~~compensation ~~on the sale~~ of ~~fixed assets of~~ $113,~~970~~022,063, ageneral ~~loss~~and onadministrative ~~the extinguishment~~ of ~~debt of~~ $~~810~~4,~~518~~243,070 and asales ~~loss~~and onmarketing ~~the change in the fair value~~ of ~~derivative liabilities of~~ $~~348~~817,~~394~~103.

During the ~~three~~nine months ended ~~June~~ September 30, ~~2020~~2019, ~~the~~we ~~Company~~ incurred ~~interest~~a ~~expense~~loss from operations of $~~323~~8,~~901~~689,587. ~~which~~This ~~was~~is ~~comprised~~due ofto anprofessional ~~accrued~~fees ~~interest expense~~ of $60805,~~765~~605, ~~and~~compensation ~~a debt discount~~ of $~~159~~7,~~171~~188,496 including ~~and~~stock-based acompensation ~~loss~~of on$5,979,629, ~~the~~general ~~change~~and inadministrative ~~the~~of ~~fair~~$1,122,968 ~~value~~and ofsales ~~derivative~~and ~~liabilities~~marketing of $~~314~~227,~~239~~419.

During the ~~six~~three months ended ~~June~~ September 30, ~~2019~~2020, ~~the~~we ~~Company~~ incurred ~~interest~~a ~~expense~~loss from operations of $107,~~858~~828,528. ~~and~~This ais ~~gain~~due onto ~~extinguishment~~professional fees of ~~debt~~$413,906, compensation of $2,848,861 including stock-based compensation of $1,~~855~~941,362, general and administrative of $2,219,705 and sales and marketing of $355,733.

During the three months ended ~~June~~ September 30, 2019, ~~the~~we ~~Company~~ incurred ~~interest~~a ~~expense~~loss from operations of $6,175,368. This is due to professional fees of $296,735, compensation of $5,691,843 including ~~and~~stock-based acompensation ~~gain~~of on$5,007,996, ~~extinguishment~~general and administrative of ~~debt~~$709,536 and sales and marketing of $2134,~~080~~142.

The cost to operationally integrate and ~~increase~~the ininefficiencies ~~other~~created ~~income~~by ofhaving $1multiple redundant personnel,~~748~~ drivers,~~672~~ ~~was~~routes, vehicles, software, and marketing were higher than forecasted. By the ~~result~~middle of ~~interest~~Q4 of 2019 and ~~the~~into ~~amortization~~Q1 of ~~debt~~2020 ~~discount~~we onworked to remove redundancies and operational overhead to streamline processes and the Company~~’s notes~~ ~~payable,~~did not start to realize the ~~extinguishment~~savings and efficiencies until the last month of ~~debt~~Q1 2020. The cost of being public created significant additional professional services fees for both legal, audit, and ~~derivative~~accounting ~~expense~~services to ~~related~~support tonot aonly ~~note~~the ~~payable~~Company but also the acquisition targets.

~~Net Loss~~Compensation

~~For~~The ~~the~~Company’s ~~six~~compensation ~~months ended June 30, 2020, our net loss was $7,466,991 as compared to net loss of $2,523,222~~ for the nine ~~prior~~months ~~period~~September ~~June~~ 30, ~~2019.~~2020 ~~The increase in net loss of $4,943,769 was related primarily to the Company pivoting to a new business model~~ and ~~the~~2019 ~~cost~~are ofas ~~integrating acquisitions and the gain on the extinguishment of debt.~~follows:

For the three months ended June 30, 2020, our net loss was $3,761,652 as compared to net loss of $1,568,835 for the prior period June 30, 2019. The increase in net loss of $2,192,817 was related primarily to the Company pivoting to a new business model and the cost of integrating acquisitions.

Compensation Type	Nine months ended September 30, 2020		Nine months ended September 30, 2019
Salary and Wages	$	2,621,500	$	1,208,867
Stock Option and Warrant Compensation		3,022,063		5,979,629
Total Compensation	$	5,643,563	$	7,188,496

~~Full~~The ~~Year~~Company’s ~~2019~~compensation ~~Pro~~for ~~Forma~~the three ~~Income~~months ~~with~~September ~~Budee~~30, ~~Inc.~~ 2020 and ~~Ganjarunner,~~2019 ~~Inc~~are ~~Acquisitions~~as follows:

The results on this report do not provide a complete picture of the Company’s performance had the Budee, Inc. acquisition taken place at the beginning of 2020. On February 27, 2020, the Company acquired Budee Inc., and only the revenue from February 28, 2020 forward is included in the financial statements in this report.

Compensation Type	Three months ended September 30, 2020		Three months ended September 30, 2019
Salary and Wages	$	907,499	$	683,847
Stock Option and Warrant Compensation		1,941,362		5,007,996
Total Compensation	$	2,848,861	$	5,691,843

~~The~~These ~~following~~amounts ~~presents~~only ~~the~~include ~~unaudited Pro-forma~~compensation ~~combined~~found ~~results~~in ofthe ~~operations~~compensation ofline ~~the~~item ~~Company~~on ~~with~~ the ~~Budee,~~statement ~~Inc.~~of ~~The~~operations 2and ~~entities~~does ~~were~~not ~~combined~~include oncompensation ~~January~~recorded 1,to ~~2019~~cost of sales.

	Six Months			Six Months
	June 30, 2020			June 30, 2019
Gross Revenue	$	8,550,118		$	6,337,388
Gross Profit	$	1,099,663		$	5,121,530
Net loss	$	(7,319,946	)	$	(793,475	)
Net loss per share, basic and diluted	$	(0.13	)	$	(0.02	)
Weighted average number of shares outstanding		55,819,112			46,179,458

The increase in salaries and wages from September 30, 2019 to September 30, 2020 was due to the merges with Ganjarunner and Budee.

3331

~~The unaudited~~Other pro-forma results of operations are presented for information purposes only. The unaudited pro-forma results of operations are not intended to present actual results or to project potential operating results as of any future date or for any future periods. These are meant to show what would have been attained had the acquisitions been completed as of January 1, 2019.Expenses

~~Liquidity~~During the nine months ended September 30, 2020, the Company incurred interest expense of $755,056 which was comprised of an accrued interest expense of $206,304 and a ~~Capital~~debt ~~Resources~~discount of $548,752, a loss on the sale of fixed assets of $11,970, a loss on the extinguishment of debt of $810,518, and a gain on the change in the fair value of derivative liabilities of $345,897.

WeDuring ~~are a startup and anticipate that we will incur operating losses for~~ the ~~foreseeable~~three ~~future.~~months Asended ~~of June~~ September 30, 2020, wethe ~~had~~Company ~~cash~~incurred interest expense of $~~123~~168,~~788~~253 ~~and~~which ~~working~~was ~~capital~~comprised ~~deficit~~ of ~~$11,507,823.~~ ~~Based~~an onaccrued ~~its~~interest ~~current~~expense ~~forecast~~of ~~and budget~~$64,145 ~~management~~and ~~believes that its cash resources will not be sufficient to fund~~a ~~its~~debt ~~operations~~discount ~~through the end~~ of ~~2020.~~$180,277, ~~Unless~~and ~~the~~a ~~Company~~gain ~~can~~on ~~generate sufficient revenue from~~ the ~~execution~~change ofin the ~~Company’s business~~fair ~~plan,~~value itof ~~will~~derivative ~~need~~liabilities toof ~~obtain additional capital to continue to fund the Company’s operations~~$694,291.

AsDuring ofthe ~~June~~nine months ended September 30, ~~2020~~2019, wethe ~~had~~Company aincurred ~~working~~interest ~~capital deficit~~expense of $1163,~~507~~176,~~823~~ asa ~~compared~~gain toon the sale of fixed assets of $425,~~011~~582,~~527~~ asa gain on extinguishment of ~~December~~debt 31of $521,387, ~~2019.~~and ~~There~~a ~~was~~loss anon ~~increase~~the change in ~~working~~the ~~capital~~fair ~~deficit~~value of derivative liabilities of $7807,~~496,296~~250.

~~Cash~~During ~~used in operating activities was $1,975,759 for~~ the ~~six~~three months ended ~~June~~ September 30, ~~2020 and $1~~2019,~~621,435~~ ~~for~~ the ~~prior~~Company ~~period~~incurred ~~ended~~interest ~~June~~expense 30of $53,318, ~~2019.~~a ~~The~~gain ~~increase~~on inthe ~~cash~~sale ~~used~~of infixed ~~operating activities~~assets ~~was~~of ~~due to an increase in net loss~~$23, ~~an increase in accounts payable and accrued expenses~~727, a gain on extinguishment of of debt of $521,387, and ~~increase~~a inloss ~~stock~~on ~~based~~the ~~compensation,~~change anin ~~increase~~the infair ~~amortization~~value of ~~debt~~derivative ~~discount,~~liabilities ~~and~~of ~~an increase in inventory~~$807,250.

~~Cash used~~The decrease in ~~investing~~other ~~activities~~income ~~during~~of ~~the six months ended June 30~~$908,190 was ~~2020~~the ~~and~~result ~~2019~~of ~~was~~interest ~~$199,322~~ and ~~$67,251,~~the ~~respectively.~~amortization ~~The~~of ~~decrease in~~debt ~~investing~~discount ~~activities~~on ~~was~~the ~~due~~Company’s tonotes ~~cash~~payable, ~~acquired in~~ the ~~acquisition~~extinguishment of debt, and aderivative ~~decrease~~expense inrelated ~~the~~to ~~purchase~~a ofnote ~~fixed assets~~payable.

~~Cash provided~~Net by financing activities during the six months ended June 30, 2020 and 2019 was $2,032,000 and $2,038,022, respectively. The decrease is a result of an increase in the proceeds from loan payables offset by a decrease in the sale of common stock.Loss

~~Our~~For the nine months ended September 30, ~~ability~~2020, toour ~~continue~~net asloss awas ~~going~~$14,769,492 ~~concern~~as iscompared ~~dependent~~to ~~upon~~net ~~raising~~loss ~~capital~~of ~~through~~$9,182,210 ~~financing~~for ~~transactions~~the ~~and~~prior ~~future~~period ~~revenue~~September 30, 2019. ~~Our~~The increase ~~capital~~in ~~needs~~net ~~have~~loss ~~primarily~~of ~~been~~$5,587,282 ~~met~~was ~~from~~related primarily to the ~~proceeds~~Company ofpivoting ~~private~~to ~~placements~~a ofnew ~~our~~business ~~security,~~model asand wethe ~~currently~~cost ~~have~~of ~~not~~integrating ~~generated~~acquisitions aand ~~net~~the ~~income~~gain on the extinguishment of debt.

~~The~~For condensed consolidated financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the ~~normal~~three ~~course of business. The accompanying condensed financial statements do not reflect any adjustments that might result if we are unable to continue as a going concern. During the six~~ months ended ~~June~~September 30, 2020, ~~incurred a~~our net loss ofwas $7,~~466~~302,~~991,~~500 ~~which~~as ~~was~~compared ~~primarily~~to ~~associated~~net ~~with~~loss ~~an increase in operating expenses, we had a working capital deficit~~ of $116,~~507~~658,~~823,~~988 and a shareholders’ equity of $2,844,496. These factors, among others, raise substantial doubt about our ability to continue as a going concern. Our independent auditors, in their report on our audited financial statements for the ~~year ended~~prior ~~December~~period ~~31,~~September ~~2019~~30, ~~expressed substantial doubt about our ability to continue as a going concern~~2019. ~~Our~~The ~~ability~~increase ~~to continue~~in asnet aloss ~~going~~of ~~concern ultimately is dependent on our ability to generate revenue~~$643,512 ~~which~~was isrelated ~~dependent~~primarily ~~upon our ability~~ to ~~obtain additional equity or debt financing, attain further operating efficiencies and, ultimately, achieve profitable operations. We have historically obtained funds from our shareholders through~~ the ~~sale~~Company ofpivoting ~~our securities. Management believes that we will be able~~ to ~~continue~~a ~~to raise funds through the sale of our securities to existing and~~ new ~~investors.~~business ~~Management~~model ~~believes that funding from existing~~ and ~~prospective~~ ~~new investors and future revenue will provide~~ the ~~additional~~cost ~~cash needed to meet our obligations as they become due, and will allow the development~~ of ~~our~~integrating ~~core business operations~~acquisitions. There is no assurance that capital in any form would be available to us, and if available, on terms and conditions that are acceptable. If we are unable to obtain sufficient funds, we may be forced to curtail and/or cease operations.

~~Off-Balance~~Full Year 2019 Pro Forma Income with ~~Sheet~~Budee, ~~Arrangements~~Inc. and Ganjarunner, Inc Acquisitions

~~We have~~The results on this report do not ~~entered~~provide a ~~into~~complete ~~any~~picture ~~off-balance~~of ~~sheet~~the ~~arrangements~~Company’s ~~that~~performance ~~have~~had orthe ~~are~~Budee, ~~reasonably~~Inc. ~~likely~~acquisition totaken ~~have~~place aat ~~current~~the orbeginning ~~future~~of ~~effect~~2020. On onFebruary ~~our~~27, ~~financial condition~~2020, ~~changes~~the inCompany ~~financial~~acquired ~~condition~~Budee Inc., ~~revenues~~and oronly ~~expenses,~~the ~~results~~revenue offrom ~~operations,~~February ~~liquidity~~28, ~~capital~~2020 ~~expenditures or~~forward ~~capital~~is ~~resources~~included ~~and~~in ~~would~~the befinancial statements ~~considered~~in ~~material~~this ~~to investors~~report.

~~Critical~~The following presents the unaudited pro-forma ~~accounting~~combined ~~policies~~results of operations of the Company with the Budee, Inc. The 2 entities were combined on January 1, 2019.

Principles of consolidation

	Nine Months			Nine Months
	September 30, 2020			September 30, 2019
Gross Revenue	$	14,529,993		$	6,223,725
Gross Profit	$	(1,237,660	)	$	4,944,064
Net loss	$	(14,304,770	)	$	(7,402,688	)
Net loss per share, basic and diluted	$	(0.23	)	$	(0.15	)
Weighted average number of shares outstanding		61,263,796			48,886,493

The unaudited pro-forma results of operations ~~consolidated~~are ~~condensed~~presented ~~financial~~for ~~statements~~information ~~include~~purposes ~~the~~only. ~~accounts~~The ofunaudited ~~Driven~~pro-forma ~~Deliveries,~~results ~~Inc,~~of ~~and~~operations ~~its~~are ~~wholly~~not ~~owned~~intended ~~subsidiaries,~~to present actual ~~Ganjarunner,~~results ~~Inc.,~~or ~~Global~~to ~~Wellness,~~project ~~LLC,~~potential ~~and~~operating ~~Budee,~~results ~~Inc~~as of any future date or for any future periods. ~~All~~These ~~significant~~are ~~intercompany~~meant ~~balances~~to ~~and~~show ~~transactions~~what would have been ~~eliminated in~~attained had the ~~consolidated~~acquisitions ~~condensed~~been ~~financial~~completed ~~statements~~as of January 1, 2019.

3432

~~Stock-Based Compensation~~Liquidity and Capital Resources

~~The Company~~We ~~accounts~~are ~~for~~a ~~stock-based~~startup ~~compensation~~and ~~costs~~anticipate ~~under~~that ~~the~~we will ~~provisions~~incur ofoperating ~~ASC~~losses ~~718,~~for ~~“Compensation—Stock~~the ~~Compensation”, which~~foreseeable ~~requires~~future. ~~the~~As ~~measurement~~of ~~and~~September ~~recognition~~30, of2020, ~~compensation~~we ~~expenses~~had ~~related~~cash toof ~~the~~$511,318 ~~fair~~and ~~value~~working capital deficit of ~~stock-based~~$13,045,455. ~~compensation awards~~Based ~~that~~on ~~are~~its ~~ultimately~~current ~~expected~~forecast toand ~~vest.~~budget, ~~Stock~~management ~~based~~believes ~~compensation~~that ~~expenses~~its ~~recognized~~cash ~~includes~~resources ~~the~~will ~~compensation~~not ~~cost~~be ~~for~~sufficient ~~all~~to ~~stock-based~~fund ~~payments~~its ~~granted~~operations tothrough ~~employees,~~the ~~officers,~~end ~~and~~of ~~directors~~2020. ~~based~~Unless on the ~~grant~~Company ~~date~~can ~~fair~~generate ~~value~~sufficient ~~estimated~~revenue infrom ~~accordance with~~ the ~~provisions~~execution of ~~ASC~~the ~~718.~~Company’s business ~~ASC~~plan, ~~718~~it iswill ~~also~~need ~~applied~~ to ~~awards~~obtain ~~modified,~~additional ~~repurchased,~~capital orto ~~canceled~~continue ~~during~~to fund the ~~periods~~Company’s ~~reported~~operations.

~~The Company~~As ~~accounts~~of ~~for~~September ~~warrants~~30, ~~and~~2020, ~~options~~we ~~issued~~had toa ~~non-employees~~working capital ~~under~~deficit ~~ASU~~of ~~2018-07~~$13,045,455 ~~Equity~~as –compared ~~Equity~~to ~~Based~~$4,011,527 ~~Payments~~as ~~to Non-Employees~~of December 31, ~~using~~2019. ~~the~~There ~~Black-Scholes~~was ~~option-pricing~~an ~~model~~increase in working capital deficit of $9,033,928.

~~The~~Cash ~~Company’s stock~~used ~~based~~in ~~compensation~~operating ~~expense~~activities was $13,~~080~~214,~~701~~229 ~~and $971,633~~ for the ~~six~~nine months ended ~~June~~September 30, 2020 and ~~2019~~$2,325,344 ~~respectively~~for the prior period ended September 30, 2019. The increase ~~Company’s~~in ~~stock~~cash ~~based~~used ~~compensation~~in ~~expense~~operating activities was ~~$752~~due to an increase in net loss,~~897~~ an increase in accounts payable and ~~$623~~accrued expenses,~~939~~ gain ~~for~~on ~~the~~extinguishment ~~three~~of ~~months~~debt, ~~ended~~and ~~June~~decrease 30in stock-based compensation, ~~2020~~an ~~and~~increase ~~2019~~in amortization of debt discount, ~~respectively~~and an increase in inventory.

~~Debt~~Cash used in investing activities during ~~Issued~~the ~~with~~nine ~~Warrants~~months ended September 30, 2020 and 2019 was $199,322 and $587,449, respectively. The increase in investing activities was due to cash acquired in the acquisition, a decrease in the purchase of fixed assets, a decrease in the acquisition of intangible assets, and the decrease in contingent liabilities.

~~Debt issued~~Cash ~~with~~provided ~~warrants~~by isfinancing ~~accounted~~activities during ~~for under~~ the ~~guidelines~~nine ~~established~~months byended ~~ASC~~September ~~470-20~~30, –2020 ~~Accounting~~and ~~for~~2019 ~~Debt~~was ~~with~~$3,658,000 ~~Conversion or~~and ~~Other~~$3,261,355, ~~Options~~respectively. WeThe ~~record~~increase ~~the~~is ~~relative~~a ~~fair value~~ result of ~~warrants~~an ~~related~~increase toin the ~~issuance~~proceeds offrom ~~convertible~~loan ~~debt~~payables asoffset by a ~~debt~~decrease ~~discount or~~in ~~premium.~~the ~~The~~sale ~~discount~~of orcommon ~~premium~~stock isand ~~subsequently~~proceeds ~~amortized~~from toloan ~~interest expense over the expected term of the convertible debt~~receivables.

~~Revenue~~Our ability to continue as a going concern ~~Recognition~~is dependent upon raising capital through financing transactions and future revenue. Our capital needs have primarily been met from the proceeds of private placements of our security, as we currently have not generated a net income.

AsThe ofcondensed ~~January~~consolidated 1financial statements have been prepared on a going concern basis of accounting, ~~2018~~which contemplates continuity of operations, ~~the~~realization ~~Company~~of ~~adopted~~assets and ~~ASC~~liabilities ~~606~~and commitments in the normal course of business. The ~~adoption~~accompanying ofcondensed ~~ASC~~financial ~~606~~statements ~~(Revenue~~do ~~From~~not ~~Contracts~~reflect ~~With~~any adjustments ~~Customers)~~that ~~represents~~might result if we are unable to continue as a ~~change~~going inconcern. ~~accounting~~During ~~principle~~the ~~that~~nine months ended September 30, 2020, ~~will~~incurred ~~more~~a ~~closely~~net ~~align~~loss ~~revenue~~of ~~recognition~~$14,769,492, which was primarily associated with ~~the~~an ~~delivery~~increase in operating expenses, we had a working capital deficit of ~~the~~$13,045,455, ~~Company~~and a shareholders’s ~~services~~equity ~~and~~of ~~will~~$1,561,971. ~~provide~~These ~~financial~~factors, ~~statement~~among others, raise substantial doubt about ~~readers~~our ~~with~~ability ~~enhanced~~to ~~disclosures~~continue as a going concern. InOur ~~accordance~~independent ~~with~~auditors, ~~ASC~~in ~~606~~their report on our audited financial statements for the year ended December 31, ~~revenue~~2019, isexpressed ~~recognized~~substantial ~~when~~doubt about our ability to continue as a ~~customer~~going ~~obtains~~concern. ~~control~~Our ofability ~~promised~~to continue ~~services.~~as ~~The~~a ~~amount~~going ofconcern ~~revenue~~ultimately ~~recognized~~is ~~reflects~~dependent ~~the~~on ~~consideration~~our ability to generate revenue, which ~~the~~is ~~Company~~dependent ~~expects~~upon our ability to obtain additional equity or debt financing, attain further operating efficiencies and, ultimately, achieve profitable operations. We have historically obtained funds from our shareholders through the sale of our securities. Management believes that we will be ~~entitled~~able to ~~receive~~continue into ~~exchange~~raise ~~for~~funds ~~these~~through ~~services~~the sale of our securities to existing and new investors. ~~The~~Management ~~Company~~believes ~~used~~that funding from existing and prospective new investors and future revenue will provide the ~~Modified-Retrospective~~additional ~~Method~~cash ~~when~~needed ~~adopting~~to ~~this~~meet ~~standard~~our obligations as they become due, and will allow the development of our core business operations. There ~~was~~is no ~~accounting effect~~assurance ~~due~~that capital in any form would be available to ~~the~~us, ~~initial~~and ~~adoption~~if available, on terms and conditions that are acceptable. ToIf ~~achieve~~we ~~this~~are ~~core~~unable ~~principle~~to obtain sufficient funds, ~~the~~we ~~Company~~may ~~applies~~be ~~the~~forced to ~~following~~curtail ~~five~~and/or ~~steps:~~cease operations.

1)Off-Balance ~~Identify~~Sheet ~~the contract with a customer~~Arrangements

~~The Company~~We ~~sells~~have ~~retail~~not ~~products~~entered ~~directly~~into toany ~~customers.~~off-balance sheet Inarrangements ~~these~~that ~~sales~~have ~~there~~or isare noreasonably ~~formal~~likely ~~contract~~to ~~with~~have ~~the~~a ~~customer.~~current ~~These~~or ~~sales have~~future ~~commercial~~effect ~~substance~~on ~~and~~our ~~there~~financial ~~are~~condition, nochanges ~~issues~~in financial ~~with~~condition, ~~collectability~~revenues asor ~~the~~expenses, ~~customer~~results ~~pays~~of ~~the~~operations, ~~cost~~liquidity, ofcapital ~~the~~expenditures ~~goods~~or atcapital ~~the~~resources ~~time~~and ofwould ~~purchase~~be orconsidered ~~delivery~~material to investors.

~~2) Identify the performance obligations in the contract~~33

~~The Company~~Critical ~~sells~~accounting ~~its products directly to consumers. In this case these sales represent a performance obligation with the sales and any necessary deliveries of those products.~~policies

3)Principles ~~Determine~~of ~~the transaction price~~consolidation

The ~~sales~~ ~~that~~consolidated ~~are~~condensed ~~done~~financial ~~directly~~statements include to the ~~customer~~accounts ~~have~~of noDriven ~~variable~~Deliveries, ~~consideration~~Inc, orand ~~financing~~its ~~component.~~wholly ~~The~~owned ~~transaction~~subsidiaries, ~~price~~Ganjarunner, isInc., ~~the~~Global Wellness, LLC, and ~~cost~~Budee, ~~that~~Inc. ~~those~~All ~~goods~~significant ~~are~~intercompany ~~being~~balances ~~sold~~and ~~for~~transactions ~~plus~~have ~~any~~been ~~additional~~eliminated ~~delivery~~in ~~costs~~the consolidated condensed financial statements.

35Stock-Based Compensation

4)The ~~Allocate~~Company accounts for stock-based compensation costs under the ~~transaction~~provisions ~~price~~of ASC 718, “Compensation—Stock Compensation”, which requires the measurement and recognition of compensation expenses related to ~~performance~~the ~~obligations~~fair value of stock-based compensation awards that are ultimately expected to vest. Stock-based compensation expenses recognized includes the compensation cost for all stock-based payments granted to employees, officers, and directors based on the grant date fair value estimated in accordance with the ~~contract~~provisions of ASC 718. ASC 718 is also applied to awards modified, repurchased, or canceled during the periods reported.

~~For the~~The ~~goods~~Company ~~that~~accounts ~~the~~for ~~Company~~warrants ~~sells~~and options ~~directly~~issued to ~~customers,~~non-employees ~~the~~under ~~transaction~~ASU ~~price~~2018-07, Equity is– ~~allocated~~Equity ~~between~~Based ~~the~~Payments ~~cost~~to of Non-Employees, using the ~~goods~~Black-Scholes ~~and~~option-pricing ~~any delivery fees that may be incurred to deliver to the customer~~model.

5)The ~~Recognize~~Company’s stock-based ~~revenue~~compensation ~~when~~expense orwas as$3,022,063 and $5,979,629 for the nine months ended September 30, 2020 and 2019, respectively. The Company’s ~~satisfies~~stock-based acompensation ~~performance~~expense ~~obligation~~was $1,941,362 and $5,007,996 for the three months ended September 30, 2020 and 2019, respectively.

~~For the~~Debt ~~sales~~Issued ofwith ~~the Company’s own goods the performance obligation is complete once the customer has received their product.~~Warrants

~~Disaggregation~~Debt issued with warrants is accounted for under the guidelines established by ASC 470-20 – Accounting for Debt with Conversion or Other Options. We record the relative fair value of ~~Revenue~~warrants related to the issuance of convertible debt as a debt discount or premium. The discount or premium is subsequently amortized to interest expense over the expected term of the convertible debt.

~~The following~~Revenue ~~table depicts the disaggregation of revenue according to revenue type.~~Recognition

Revenue Type	Revenue for the three months ended June 30, 2020		Revenue for the three months ended June 30, 2019			Revenue for the six months ended June 30, 2020			Revenue for the six months ended June 30, 2019
Delivery Income	$	-		18,973			27,043			34,343
Dispensary Cost Reimbursements		-		(28,559	)		(7,528	)		(63,346	)
Delivery Income, net		-		(9,586	)		19,515			(29,003	)
Product Sales		5,672,305		75,410			7,848,238			75,410
Total	$	5,672,305		65,824			7,867,753			46,407

As of January 1, 2018, the Company adopted ASC 606. The adoption of ASC 606 (Revenue From Contracts With Customers) represents a change in accounting principle that will more closely align revenue recognition with the delivery of the Company’s services and will provide financial statement readers with enhanced disclosures. In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these services. The Company used the Modified-Retrospective Method when adopting this standard. There was no accounting effect due to the initial adoption. To achieve this core principle, the Company applies the following five steps:

~~Item 3.~~1) ~~Quantitative~~Identify ~~and~~the ~~Qualitative~~contract ~~Disclosures~~with ~~about~~a ~~Market Risk.~~customer

~~Not~~The Company sells retail products directly ~~applicable~~to customers. In these sales there is no formal contract with the customer. These sales have commercial substance and there are no issues with collectability as the customer pays the cost of the goods at the time of purchase or delivery.

~~Item 4.~~2) ~~Controls~~Identify ~~and~~the ~~Procedures~~performance obligations in the contract

~~Disclosure~~The Company sells its products directly ~~Controls~~to consumers. In this case these sales represent a performance obligation with the sales and ~~Procedures~~any necessary deliveries of those products.

~~Disclosure Controls~~3) ~~and~~Determine ~~Procedures~~the transaction price

~~We carried~~The ~~out~~sales anthat ~~evaluation,~~are ~~under~~done ~~the~~directly ~~supervision~~to ~~and with~~ the ~~participation of our management, including our principal executive~~ ~~officer~~customer ~~and~~have ~~principal~~no ~~financial~~variable ~~officer,~~consideration ofor ~~the~~financing ~~effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))~~component. ~~Based~~The ~~upon~~transaction ~~that~~price ~~evaluation,~~is ~~our principal executive officer and principal financial officer concluded that, as of~~ the ~~end~~cost ~~of the period covered in this report, our disclosure controls and procedures were ineffective to ensure~~ that ~~information~~those ~~required~~goods toare bebeing ~~disclosed in reports filed under the Exchange Act, is recorded, processed, summarized and~~sold ~~reported~~for ~~within~~plus ~~the~~any ~~required~~additional ~~time~~delivery periods specified in the SEC’s rules and forms and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosurecosts.

3634

~~This~~4) ~~was~~Allocate ~~due to~~ the ~~following~~transaction ~~material~~price ~~weaknesses~~to ~~which~~performance ~~are~~obligations ~~indicative~~in ofthe ~~many small companies with limited staff:~~contract

~~(1) lack~~For ofthe agoods ~~functioning~~that ~~audit committee, (2) lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in~~ the ~~establishment~~Company ~~and~~sells ~~monitoring of required internal controls and procedures; and (3) inadequate segregation of~~directly ~~duties~~to consistent with control objectives. The aforementioned material weaknesses were identified by our Principal Executive and Financial Officers in connection with the review of our financial statements as of December 31customers, ~~2019. At this time, management has decided that given~~ the ~~risks~~transaction ~~associated~~price ~~with~~is ~~this~~allocated ~~lack~~between ~~of segregation of duties,~~ the ~~potential~~cost ~~benefit~~ of ~~adding additional personnel to clearly segregate duties does not justify~~ the ~~expenses~~goods ~~associated with such benefit. Management will periodically review this matter~~ and ~~may~~any ~~make~~delivery ~~modifications,~~fees ~~including adding additional personnel, it determines appropriate. In addition, we believe~~ that ~~our~~may ~~financial~~be ~~statements~~incurred ~~presented~~to ~~in this quarterly report on Form 10-Q fairly present, in all material respects,~~deliver ~~our~~to ~~financial~~the ~~position, results of operations, and cash flows for all periods presented herein~~customer.

~~Changes in~~5) ~~Internal~~Recognize ~~Control~~revenue ~~over~~when ~~Financial~~or ~~Reporting~~as the Company satisfies a performance obligation

~~There were~~For nothe ~~changes~~sales inof ~~our~~the ~~internal control over financial reporting during our fiscal first quarter ended June 30, 2020, which were identified in conjunction with management~~Company’s ~~evaluation~~own goods ~~required~~the byperformance ~~paragraph~~obligation ~~(d)~~is ofcomplete ~~Rules~~once ~~13a-15 and 15d-15 under~~ the ~~Exchange Act,~~customer ~~that~~has ~~have~~received ~~materially~~their ~~affected, or are reasonably likely to materially affect, our internal control over financial reporting~~product.

37Disaggregation of Revenue

~~Part~~The following table depicts the disaggregation ~~II:~~of ~~Other~~revenue ~~Information~~according to revenue type.

Item 1. Legal Proceedings

Revenue Type	Revenue for the three months ended September 30, 2020		Revenue for the three months ended September 30, 2019			Revenue for the nine months ended September 30, 2020			Revenue for the nine months ended September 30, 2019
Delivery Income	$	-	$	53,496		$	27,043		$	87,869
Dispensary Cost Reimbursements		-		(36,007	)		(7,528	)		(99,353	)
Delivery Income, net		-		17,489			19,515			(11,484	)
Product Sales		5,979,875		1,195,174			13,828,113			1,270,554
Total	$	5,979,875	$	1,212,663		$	13,847,628		$	1,259,070

~~From time~~Item ~~to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business~~3. ~~Litigation~~ isQuantitative ~~subject to inherent uncertainties,~~ and anQualitative ~~adverse~~Disclosures ~~result~~about inMarket ~~these or other matters may arise from time to time that may harm business~~Risk. We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results except as set forth below:

~~Carla Baumgartner,~~Not ~~Chris Haas, and Eric Steele (“Plaintiff”) filed a Complaint against Driven Deliveries, Inc~~applicable. (“Driven”), and Brian Hayek and Christian Schenk, individually, on November 26, 2019 in San Diego County Superior Court, Case No. 37-2019-00063208. In June 2019, Driven entered into a Merger Agreement with Ganjarunner, Inc. (“Ganjarunner”), whereby Driven acquired Ganjarunner. Plaintiffs, the former owners of Ganjarunner, allege in their First Amended Complaint causes of action for Breach of the Merger Agreement, Fraudulent Inducement, Fraudulent Concealment, Negligent Misrepresentation, Breach of Fiduciary Duty, Violation of Corporate Code § 25401, Conversion, Unfair Competition, and Violation of Penal Code §496. On February 18, 2020, Driven filed a Demurrer to Plaintiffs’ First Amended Complaint challenging seven of Plaintiffs’ nine causes of action. The hearing on the demurrer, original set for May 1, 2020, has been continued indefinitely due to Court closures. The Company intends to vigorously defend against this action.

~~On July~~Item ~~13, 2020 the Company reached a settlement agreement with the Plaintiff~~4. AsControls ~~part of the settlement agreement the Company shall issue~~ and deliver to the Plaintiffs 5,000,000 shares of the Company’s restricted common stock Plaintiffs, and the warrants issued to the Plaintiffs shall be null and void. Additionally cash consideration is due to the Plaintiffs on the following schedule: 1) One Hundred Seventy-Five Thousand Dollars ($175,000) immediately upon the signing of the agreement (“Effective Date”); 2) Eighty-Five Thousand Dollars ($85,000) within fourteen (14) days following the Effective Date 3) One Hundred Seventy-Five Thousand Dollars ($175,000) within thirty (30) days following the Effective Date; 4) Seventy-Five Thousand Dollars ($75,000) within sixty (60) days following the Effective Date; and 5) Three Hundred Thousand Dollars ($300,000) on or before July 1, 2021.Procedures

~~In February~~Disclosure ~~2020~~Controls Irth Communications, LLC filed a complaint in the Superior Court of California, County of Los Angeles, against the Company. The complaint alleges that pursuant to a services agreement the Company issued Irth 500,000 shares of its common stock to Irth but the Company breached this agreement because according to the complaint, the Company has refused to authorize its transfer agent to remove the restrictive legend on the Shares. Among other remedies, Irth seeks at least $1,130,000 in compensatory damages, attorneys’ fees, and ~~injunctive relief. The Company is reviewing the Complaint and intends to defend itself vigorously.~~Procedures

~~Prior to~~Disclosure ~~the~~Controls closure of its merger with Driven, Budee, Inc. was the party defendant in an action brought by a former employee under California’s Private Attorney General Act (“PAGA”) in relation to various labor claims. Under the terms of the merger agreement, Driven and Budee had contemplated and accounted for various possible outcomes of the PAGA matter with built-in limitations on any possible exposure to Driven if the merger were to close before resolution of the PAGA action, including indemnification from in the event that any assumed liabilities under the merger crossed a certain threshold.Procedures

~~As matters~~We ~~progressed,~~carried ~~the~~out ~~PAGA~~an ~~action~~evaluation, ~~was~~under ~~resolved~~the supervision byand ~~settlement~~with inthe ~~October~~participation of ~~2019~~our management, ~~prior~~including toour ~~the~~principal ~~closing~~executive ofofficer ~~the~~and ~~merger~~principal ~~between~~financial officer, ~~Budee~~of ~~and~~the ~~Driven.~~effectiveness ~~The~~of ~~gross~~our ~~settlement~~disclosure ~~amount~~controls isand ~~$600,000.00.~~procedures ~~Following~~(as ~~settlement~~defined ~~being~~in ~~reached,~~Exchange ~~the~~Act ~~parties~~Rules ~~agreed~~13a-15(e) toand ~~stipulate~~15d-15(e)). Based toupon anthat ~~amendment~~evaluation, ~~whereby~~our ~~the~~principal ~~matter~~executive ~~would~~officer beand ~~converted~~principal tofinancial aofficer ~~class~~concluded ~~action~~that, ~~thus~~as ~~significantly~~of ~~expanding~~the ~~settlement~~end ~~coverage.~~of ~~The~~the period ~~parties~~covered ~~have~~in ~~finalized~~this ~~the~~report, ~~settlement~~our ~~and~~disclosure ~~class~~controls ~~documents~~ and ~~the~~procedures ~~plan~~were ofineffective ~~administration~~to ~~and~~ensure ~~these~~that ~~documents~~information ~~are~~required ~~due~~ to be ~~submitted~~disclosed toin reports filed under the ~~Court~~Exchange inAct, ~~May~~is recorded, ~~2020~~processed, ~~for~~summarized ~~preliminary~~and ~~approval.~~reported Itwithin isthe ~~anticipated~~required ~~that~~time ~~following~~periods ~~preliminary~~specified in ~~approval,~~the ~~settlement~~SEC’s ~~notices~~ rules and ~~administration~~forms ~~will~~and ~~take~~is aaccumulated ~~number~~and ofcommunicated ~~months~~ to ~~complete~~our management, ~~prior~~including our principal executive officer and principal financial officer, as appropriate to ~~final~~allow ~~approval~~timely ~~being~~decisions ~~entered~~regarding required disclosure.

38This was due to the following material weaknesses which are indicative of many small companies with limited staff:

At(1) lack of a functioning audit committee, no(2) lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; and (3) inadequate segregation of duties consistent with control objectives. The aforementioned material weaknesses were identified by our Principal Executive and Financial Officers in connection with the review of our financial statements as of December 31, 2019. At this time, management has ~~Driven~~decided ~~been~~that agiven ~~party~~the risks associated with this lack of segregation of duties, the potential benefit of adding additional personnel to clearly segregate duties does not justify the expenses associated with such benefit. Management will periodically review this ~~litigation~~matter and may make modifications, ~~nor~~including isadding additional personnel, it ~~anticipated~~determines appropriate. In addition, we believe that ~~for~~our ~~any~~financial ~~reason~~statements presented itin ~~will~~this ~~become~~quarterly ~~one~~report on Form 10-Q fairly present, in all material respects, our financial position, results of operations, and cash flows for all periods presented herein.

~~Item 1A.~~Changes ~~Risk~~in ~~Factors~~Internal Control over Financial Reporting

~~Smaller~~There were no changes in our internal control over financial reporting ~~companies~~during ~~are~~our ~~not~~fiscal ~~required~~first toquarter ~~provide~~ended ~~the~~September ~~information~~30, 2020, which were identified in conjunction with management’s evaluation required by ~~this~~paragraph ~~item~~(d) of Rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

~~Item 2. Unregistered Sale of Equity Securities and Use of Proceeds~~35

~~For the~~Part ~~six~~II: ~~months~~Other ~~ended June 30, 2020, the Company sold a total of 1,784,000 shares of its common stock to 24 accredited investors, for an aggregate purchase price of $892,000.~~Information

~~The securities~~Item ~~above~~1. ~~were~~Legal offered and sold in reliance upon an exemption from the registration requirements under Rule 506 of Regulation D and/or Section 4(a)(2) of the Securities Act since, among other things, the transactions did not involve a public offering of the shares.Proceedings

~~Item~~From time to time, we may become involved 3in various lawsuits and legal proceedings, which arise in the ordinary course of business. ~~Defaults~~Litigation ~~upon~~is ~~Senior~~subject ~~Securities~~to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm business. We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results except as set forth below:

~~None~~Carla Baumgartner, Chris Haas, and Eric Steele (“Plaintiff”) filed a Complaint against Driven Deliveries, Inc. (“Driven”), and Brian Hayek and Christian Schenk, individually, on November 26, 2019 in San Diego County Superior Court, Case No. 37-2019-00063208. In June 2019, Driven entered into a Merger Agreement with Ganjarunner, Inc. (“Ganjarunner”), whereby Driven acquired Ganjarunner. Plaintiffs, the former owners of Ganjarunner, allege in their First Amended Complaint causes of action for Breach of the Merger Agreement, Fraudulent Inducement, Fraudulent Concealment, Negligent Misrepresentation, Breach of Fiduciary Duty, Violation of Corporate Code § 25401, Conversion, Unfair Competition, and Violation of Penal Code §496. On February 18, 2020, Driven filed a Demurrer to Plaintiffs’ First Amended Complaint challenging seven of Plaintiffs’ nine causes of action. The hearing on the demurrer, original set for May 1, 2020, has been continued indefinitely due to Court closures. The Company intends to vigorously defend against this action.

~~Item~~On July 13, 2020 the Company reached a 4settlement agreement with the Plaintiff. ~~Mine~~As ~~Safety~~part ~~Disclosures~~of the settlement agreement the Company shall issue and deliver to the Plaintiffs 5,000,000 shares of the Company’s restricted common stock Plaintiffs, and the warrants issued to the Plaintiffs shall be null and void. Additionally cash consideration is due to the Plaintiffs on the following schedule: 1) One Hundred Seventy-Five Thousand Dollars ($175,000) immediately upon the signing of the agreement (“Effective Date”); 2) Eighty-Five Thousand Dollars ($85,000) within fourteen (14) days following the Effective Date 3) One Hundred Seventy-Five Thousand Dollars ($175,000) within thirty (30) days following the Effective Date; 4) Seventy-Five Thousand Dollars ($75,000) within sixty (60) days following the Effective Date; and 5) Three Hundred Thousand Dollars ($300,000) on or before July 1, 2021.

~~Not~~In February 2020 Irth Communications, ~~applicable~~LLC filed a complaint in the Superior Court of California, County of Los Angeles, against the Company. The complaint alleges that pursuant to a services agreement the Company issued Irth 500,000 shares of its common stock to Irth but the Company breached this agreement because according to the complaint, the Company has refused to authorize its transfer agent to remove the restrictive legend on the Shares. Among other remedies, Irth seeks at least $1,130,000 in compensatory damages, attorneys’ fees, and injunctive relief. The Company is reviewing the Complaint and intends to defend itself vigorously.

~~Item~~Prior to the closure of its merger with 5Driven, Budee, Inc. ~~Other~~was ~~Information~~the party defendant in an action brought by a former employee under California’s Private Attorney General Act (“PAGA”) in relation to various labor claims. Under the terms of the merger agreement, Driven and Budee had contemplated and accounted for various possible outcomes of the PAGA matter with built-in limitations on any possible exposure to Driven if the merger were to close before resolution of the PAGA action, including indemnification from in the event that any assumed liabilities under the merger crossed a certain threshold.

~~None~~As matters progressed, the PAGA action was resolved by settlement in October of 2019, prior to the closing of the merger between Budee and Driven. The gross settlement amount is $600,000.00. Following settlement being reached, the parties agreed to stipulate to an amendment whereby the matter would be converted to a class action, thus significantly expanding settlement coverage. The parties have finalized the settlement and class documents and the plan of administration and these documents are due to be submitted to the Court in May, 2020 for preliminary approval. It is anticipated that following preliminary approval, settlement notices and administration will take a number of months to complete, prior to final approval being entered.

~~Item~~At no time has Driven been a party to 6.this ~~Exhibits~~litigation, nor is it anticipated that for any reason it will become one.

~~The following is a complete list of exhibits filed as part of this Form 10-Q. Exhibit numbers correspond to the numbers in the Exhibit Table of Item 601 of Regulation S-K.~~36

Exhibit No.		Description
31.1*		Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer
31.2*		Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer
32.1*		Section 1350 Certification of Chief Executive Officer
32.2*		Section 1350 Certification of Chief Financial Officer
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

Item 1A. Risk Factors

~~(*)~~Smaller –reporting ~~Filed~~companies ~~herewith.~~are ~~(**)~~not –required to ~~Furnished~~provide ~~herewith~~the information required by this item.

39Item 2. Unregistered Sale of Equity Securities and Use of Proceeds

~~SIGNATURES~~For the nine months ended September 30, 2020, the Company sold a total of 2,017,561 shares of its common stock to 24 accredited investors, for an aggregate purchase price of $2,018,000.

~~Pursuant~~The securities above were offered and tosold in reliance upon an exemption from the registration requirements under Rule 506 of Regulation D and/or Section 124(a)(2) of the Securities ~~Exchange~~ Act ~~of 1934~~since, ~~the~~among ~~registrant~~other ~~has~~things, ~~duly~~the ~~caused~~transactions ~~this~~did ~~report~~not toinvolve bea ~~signed on~~public ~~its~~offering ~~behalf~~of by the ~~undersigned, thereunto duly authorized~~shares.

Date: August 10, 2020	Driven Deliveries, Inc.
	By:	/s/ Christian Schenk
		Christian Schenk
		Chairman and Chief Executive Officer
		(Principal Executive Officer)

Item 3. Defaults upon Senior Securities

40None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

The following is a complete list of exhibits filed as part of this Form 10-Q. Exhibit numbers correspond to the numbers in the Exhibit Table of Item 601 of Regulation S-K.

Exhibit No.		Description
31.1*		Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Executive Officer
31.2*		Rule 13(a)-14(a)/15(d)-14(a) Certification of Chief Financial Officer
32.1*		Section 1350 Certification of Chief Executive Officer
32.2*		Section 1350 Certification of Chief Financial Officer
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 herewith.

(**) – Furnished herewith.

SIGNATURES

Pursuant to the requirements of Section 12 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.

Date: November 23, 2020	Driven Deliveries, Inc.

	By:	/s/ Salvador Villanueva
		Salvador Villanueva
		President and Interim Chief Executive Officer
		(Principal Executive Officer)

By:	/s/ Brian Hayek
	Brian Hayek
	Chief Financial Officer, Treasurer, Secretary
	(Principal Financial Officer)

Filing Compare · Driven Deliveries, Inc.