UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended: ~~May~~August 31, 2019

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

Commission file number: 000-27225

DigitalTown, Inc. ~~(Exact name of registrant as specified in its charter)~~

Minnesota		41-1427445
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
506 - 477 Peace Portal Drive, Blaine, Washington		98230
(Address of principal executive offices)		(Zip Code)
Registrant’s telephone number: (425) 577-7766

(Exact name of registrant as specified in its charter)

Minnesota

41-1427445

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

506 - 477 Peace Portal Drive, Blaine, Washington		98230
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number: (425) 577-7766

Securities registered under Section 12(b) of the Exchange Act:

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

~~Check~~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 ~~past~~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. x Yes ¨ [X] No [ ]

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

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

Large Accelerated Filer ¨[ ~~Non-~~] Accelerated Filer ¨[ ~~Accelerated~~] Non-accelerated Filer ¨[X] Smaller reporting company x[X] Emerging growth company [ ]

~~Indicate~~If an emerging growth company, indicate by check mark ~~whether~~if the registrant ishas aelected ~~shell~~not ~~company~~to ~~(as~~use ~~defined~~the inextended ~~Rule~~transition ~~12b-2~~period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act). ~~¨ Yes x No~~[ ]

~~There~~Indicate by ~~were~~check ~~1,403,289,150~~mark ~~shares~~whether of the registrant’s ~~common~~is ~~stock~~a ~~outstanding~~shell company (as ofdefined ~~August~~in ~~16,~~Rule ~~2019~~12b-2 of the Act). Yes [X] No [ ]

As of November 25, 2019, there were 2,562,664,837 shares of the registrant’s common stock outstanding.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION		3
Item 1.	Financial Statements		3
ITEM 1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets		3
	Condensed consolidated balance sheet as of August 31, 2019 and February 28, 2019	3
	Consolidated Statements of Operations		4
	Condensed consolidated statements of operations for the three and six months ended August 31, 2019 and 2018	4
	Consolidated Statement of Stockholders’ Equity (Deficit)		5
	Condensed consolidated statement of equity/(deficit) for the six months ended August 31, 2019	5
	Consolidated Statements of Cash Flows		6
	Condensed consolidated statements of cash flows for the sex months ended August 31, 2019 and 2018	6
	Notes to Consolidated Financial Statements		7
	Notes to condensed consolidated financial statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		30
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		34
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	36
Item 4.	Controls and Procedures
ITEM 4.	Controls and Procedures	36
PART II - OTHER INFORMATION		36
Item 1.	Legal Proceedings		35
ITEM 1.	Legal Proceedings	36
Item 1A	Risk Factors		35
ITEM 1A	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		35
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults Upon Senior Securities		35
ITEM 3.	Defaults Upon Senior Securities	37
Item 4.	Mine Safety Disclosures		35
ITEM 4.	Mine Safety Disclosures	37
Item 5.	Other Information		35
ITEM 5.	Other Information	37
Item 6.	Exhibits		36
ITEM 6.	Exhibits	37
Signatures			37
SIGNATURES		38

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

DIGITALTOWN, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

	May 31,			February 28,
	August 31, 2019			February 28, 2019
	2019			2019
	(Unaudited)
ASSETS
Current assets:
Cash	$	344,~~462~~689		$	15,271
Accounts receivable, net		-7,485			25,343
Total current assets		3412,~~462~~174			40,614
Property and equipment, net		-			19,208
Total assets	$	3412,~~462~~174		$	59,822
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	~~485~~186,~~609~~001		$	551,387
Accounts payable – related parties		~~273~~365,~~000~~729			213,566
Deferred revenue		~~136~~120,~~305~~000			186,305
Domain marketing development obligation		168,174			168,174
Interest payable		5357,~~157~~487			46,235
Accrued expenses - related parties		542,066			542,066
Notes payable - related parties		1171,~~025,200~~342			1,025,200
Convertible notes payable - third parties, net		75120,~~851~~578			246,175
Liabilities held for sale		~~1,631~~-			12,828
Total current liabilities		21,~~760~~731,~~993~~377			2,991,936
Commitments and contingencies
Stockholders’ equity (deficit):
Common stock, $0.01 par value, 2,000,000,000 shares authorized, 862,278,202 and 146,740,570 shares issued and outstanding at May 31, 2019 and February 28, 2019, respectively		8,622,782			1,467,406
Common stock, $0.01 par value, 2,000,000,000 shares authorized, 1,664,876,270 and 146,740,570 shares issued and outstanding at August 31, 2019 and February 28, 2019, respectively		16,648,763			1,467,406
Preferred stock, $0.01 par value, 20,000,000 shares authorized, no shares issued and outstanding at May 31, 2019 and February 28, 2019, respectively		-			-
Preferred stock, $0.01 par value, 20,000,000 shares authorized, 51 and 0 shares issued and outstanding at August 31, 2019 and February 28, 2019, respectively		1			-
Additional paid-in-capital		4438,~~714~~346,~~451~~411			51,411,971
Stock payable		~~784~~525,~~729~~572			478,650
Subscriptions receivable
Accumulated other comprehensive income		(1,819	)		(819	)
Accumulated other comprehensive income		(604	)		(819	)
Accumulated deficit		(57,238,131	)		(56,289,322	)
Accumulated deficit		(56,847,889	)		(56,289,322	)
Total stockholders’ equity (deficit)		(1,719,203	)		(2,932,114	)
Total stockholders’ equity (deficit)		(2,726,531	)		(2,932,114	)
Total liabilities and stockholders’ equity (deficit)	$	12,174		$	59,822
Total liabilities and stockholders’ equity (deficit)	$	34,462		$	59,822

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

3 ~~Table of Contents~~

DIGITALTOWN, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

	For the Three Months EndedMay 31,
	Three Months Ended August 31						Six Months Ended August 31
	2019			2018			2019			2018
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Revenues	$	~~50,000~~-		$	2120,~~925~~047		$	50,000		$	41,972
Cost of revenues		~~306~~-			~~407~~114,~~052~~937			306			521,989
Gross profit (loss)		~~49,694~~-			(~~385~~94,~~127~~890	)		49,694			(480,017	)
Operating expenses:
Selling, general and administrative expenses		~~342~~263,~~374~~007			1,~~175~~511,~~444~~914			605,381			2,687,358
Loss from operations		(~~292~~263,~~680~~007	)		(1,~~560~~606,~~571~~804	)		(555,687	)		(3,167,375	)
Other income (expense):
Loss on disposal of asset		(19,208	)		-
Interest expense		(127,235	)		(80,405	)		(373,914	)		(673,819	)
Interest expense		(246,679	)		(593,414	)
Loss on disposal of asset		-			-			(19,208	)		-
Total other income (expense)		(265,887	)		(593,414	)
Loss on debt settlement		-			(48,037	)		-			(48,037	)
Loss before income taxes		(558,567	)		(2,153,985	)
Digital currency losses		-			(925,817	)		-			(925,817	)
Income tax provision
Total other income (expense)		(127,235	)		(1,054,259	)		(393,122	)		(1,647,673	)
Net loss from continuing operations, net of income taxes		(558,567	)		(2,153,985	)
Loss before income taxes		(390,242	)		(2,661,063	)		(948,809	)		(4,815,048	)
Loss from discontinued operations		-			(102,157	)
Income tax provision		-			-			-			-
Net loss	$	(558,567	)	$	(2,256,142	)
Net loss from continuing operations, net of income taxes		(390,242	)		(2,661,063	)		(948,809	)		(4,815,048	)
Net loss per common share – basic and diluted	$	(0.00	)	$	(0.03	)
Loss from discontinued operations		-			(71,453	)		-			(173,610	)
Weighted average common shares outstanding – basic and diluted		289,973,493			86,876,957
Net loss	$	(390,242	)	$	(2,732,516	)	$	(948,809	)	$	(4,988,658	)
Net loss per common share – basic and diluted	$	(0.00	)	$	(0.02	)	$	(0.00	)	$	(0.05	)
Weighted average common shares outstanding – basic and diluted		1,266,642,830			126,564,143			778,308,162			106,720,550

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

4 ~~Table of Contents~~

DIGITALTOWN, INC. AND SUBSIDIARIES

Consolidated Statement of Stockholders’ Equity (Deficit)

~~Three~~ Six Months Ended ~~May~~August 31, 2019

													Accumulated
							Additional						Other
	Common Stock						Paid-In			Stock			Comprehensive			Accumulated
	Shares			Amount			Capital			Payable			Loss			Deficit			Total
Balance as of February 28, 2018		84,509,824		$	845,098		$	43,698,746		$	2,221,603		$	5,098		$	(48,885,896	)	$	(2,115,351	)
Common stock issued for stock payable		9,783,548			97,835			1,730,365			(1,828,200	)		-			-			-
Common stock issued for cash		15,097,113			150,971			919,574			-			-			-			1,070,545
Common stock issued for cryptocurrency		11,385,590			113,856			1,545,144			-			-			-			1,659,000
Stock issued for conversion of third-party debt		8,933,740			89,337			82,208			-			-			-			171,545
Stock issued for conversion of accounts payable		252,500			2,525			16,675			42,500			-			-			61,700
Stock issued for conversion of related party debt		9,880,274			98,803			889,225			-			-			-			988,028
Stock issued for compensation		6,722,981			67,231			1,949,698			42,747			-			-			2,069,399
Stock issued for finder fee		100,000			1,000			(1,000	)		-			-			-			-
Stock issued for debt discount		90,000			900			7,110			-			-			-			8,010
Stock reclaimed for sale of domains		(15,000	)		(150	)		(2,850	)		-			-			-			(3,000	)
Contributed capital		-			-			20,000			-			-			-			20,000
Beneficial conversion feature		-			-			536,951			-			-			-			536,951
Imputed interest		-			-			20,125			-			-			-			20,125
Foreign currency translation adjustment		-			-			-			-			(5,917	)		-			(5,917	)
Net Loss		-			-			-			-			-			(7,403,426	)		(7,403,426	)
Balance as of February 28, 2019		146,740,570		$	1,467,406		$	51,411,971			478,650		$	(819	)	$	(56,289,322	)	$	(2,932,114	)
Stock issued for conversion of third-party debt		715,537,632			7,155,376			(6,745,293	)		-									410,083
Stock issued for conversion of accounts payable		-			-			-			84,687									84,687
Stock issued for compensation		-			-			-			221,392			-			-			221,392
Beneficial conversion feature		-			-			45,000			-			-			-			45,000
Imputed interest		-			-			2,773			-			-			-			2,773
Foreign currency translation adjustment		-			-			-			-			215			-			215
Net Loss		-			-			-			-			-			(558,567	)		(558,567	)
Balance as of May 31, 2019		862,278,202		$	8,622,782		$	44,714,451		$	784,729		$	(604	)	$	(56,847,889	)	$	(2,726,532	)

(Unaudited)

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

																	Accumulated
											Additional						Other
	Common Stock						Preferred Stock				Paid-In			Stock			Comprehensive			Accumulated
	Shares			Amount			Shares		Amount		Capital			Payable			Loss			Deficit			Total
Balance as of February 28, 2018		84,509,824		$	845,098			-		-	$	43,698,746		$	2,221,603		$	5,098		$	(48,885,896	)	$	(2,115,351	)

Common stock issued for stock payable		9,783,548			97,835			-		-		1,730,365			(1,828,200	)		-			-			-
Common stock issued for cash		15,097,113			150,971			-		-		919,574			-			-			-			1,070,545
Common stock issued for cryptocurrency		11,385,590			113,856			-		-		1,545,144			-			-			-			1,659,000
Stock issued for conversion of third-party debt		8,933,740			89,337			-		-		82,208			-			-			-			171,545
Stock issued for conversion of accounts payable		252,500			2,525			-		-		16,675			42,500			-			-			61,700
Stock issued for conversion of related party debt		9,880,274			98,803			-		-		889,225			-			-			-			988,028
Stock issued for compensation		6,722,981			67,231			-		-		1,949,698			42,747			-			-			2,069,399
Stock issued for finder fee		100,000			1,000			-		-		(1,000	)		-			-			-			-
Stock issued for debt discount		90,000			900			-		-		7,110			-			-			-			8,010
Stock reclaimed for sale of domains		(15,000	)		(150	)		-		-		(2,850	)		-			-			-			(3,000	)
Contributed capital		-			-			-		-		20,000			-			-			-			20,000
Beneficial conversion feature		-			-			-		-		536,951			-			-			-			536,951
Imputed interest		-			-			-		-		20,125			-			-			-			20,125
Foreign currency translation adjustment		-			-			-		-		-			-			(5,917	)		-			(5,917	)
Net Loss		-			-			-		-		-			-			-			(7,403,426	)		(7,403,426	)
Balance as of February 28, 2019		146,740,570		$	1,467,406			-		-	$	51,411,971			478,650		$	(819	)	$	(56,289,322	)	$	(2,932,114	)

Stock issued for conversion of third-party debt		1,455,895,580			14,558,955			-		-		(13,713,347	)		496,513			-			-			1,342,121
Stock issued for conversion of accounts payable		8,068,690			80,687			-		-		322,747			24,000			-			-			427,434
Stock issued for compensation		54,171,430			541,715			-		-		153,268			(473,591	)		-			-			221,392
Beneficial conversion feature		-			-			-		-		70,000			-			-			-			70,000
Imputed interest		-			-			-		-		2,773			-			-			-			2,773
Foreign currency translation adjustment		-			-			-		-		-			-			(1,000	)		-			(1,000	)
Issuance of super-voting preferred shares		-			-			51		1		98,999			-			-			-			99,000
Net Loss		-			-			-		-		-			-			-			(948,809	)		(948,809	)
Balance as of August 31, 2019		1,664,876,270		$	16,648,763			51	$	1	$	38,346,411		$	525,572		$	(1,819	)	$	(57,238,131	)	$	(1,719,203	)

5The accompanying ~~Table~~notes are an integral part of ~~Contents~~these consolidated financial statements.

~~DIGITALTOWN, INC. AND SUBSIDIARIES~~5

~~Consolidated~~DIGITALTOWN, INC. ~~Statements~~AND ~~of Cash Flows~~SUBSIDIARIES

	For the Three Months EndedMay 31,
	2019			2018
	(Unaudited)			(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss from discontinued operations		-		$	(102,157	)
Net loss from continuing operations	$	(558,567	)		(2,153,985	)
Adjustments to reconcile net loss to net cash flows used in operating activities:
Depreciation expense		-			1,842
Debt discount amortization		190,342			562,923
Loss on debt penalty		32,343			-
Imputed interest		2,773			12,125
Loss on disposal of fixed assets		19,208			-
Stock based compensation		221,392			436,406
Changes in operating assets and liabilities:
Accounts receivable		25,343			706
Prepaid expenses		-			24,762
Accounts payable		18,909			88,123
Accounts payable – related parties		59,434			428,407
Accrued expenses		(37,203	)		7,331
Domain marketing development obligation		-			46,963
Digital currencies		-			(15,882	)
Net cash used in operating activities		(26,024	)		(662,436	)
CASH FLOWS FROM INVESTING ACTIVITIES
Cash received from sale of digital currencies		-			98,656
Net cash provided by investing activities		-			98,656
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock		-			566,950
Borrowings on convertible notes		45,000			-
Payments on promissory note		-			(40,000	)
Net cash provided by financing activities		45,000			526,950
Foreign currency translation adjustment		215			(1,376	)
Net change in cash and cash equivalents		19,191			(38,206	)
Cash and cash equivalents, beginning of year		15,271			58,712
Cash and cash equivalents, end of year	$	34,462		$	20,506
Non-Cash Transactions:
Issuance of common stock for stock payable		-		$	1,828,200
Conversion of debt to common stock	$	410,083		$	1,067,528
Stock payable for accounts payable	$	84,687			-
Stock issued for digital currencies		-		$	1,659,000
Loss on digital currencies		-		$	196,070
Stock cancelled for sale of prepaid domains		-		$	3,000
Finders fee for stock issued		-		$	1,000
Beneficial conversion feature	$	45,000			-

Consolidated Statements of Cash Flows

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

	For the Six Months Ended August 31,
	2019			2018
	(Unaudited)			(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss from discontinued operations		-		$	(173,610	)
Net loss from continuing operations	$	(948,809	)		(4,815,048	)
Adjustments to reconcile net loss to net cash flows used in operating activities:
Loss on debt settlement		-			48,037
Loss on cryptocurrency sale		-			925,817
Depreciation and amortization		-			3,885
Debt discount amortization		312,283			652,540
Loss on debt penalty		32,343			-
Imputed interest		2,773			14,625
Loss on disposal of fixed assets		19,208			-
Stock based compensation		320,392			1,118,367
Changes in operating assets and liabilities:
Accounts receivable		17,858			6,108
Prepaid expenses		-			38,677
Accounts payable		62,049			204,764
Accounts payable – related parties		152,163			340,545
Accrued expenses		(49,842	)		95,199
Net cash used in operating activities		(79,582	)		(1,540,094	)

CASH FLOWS FROM INVESTING ACTIVITIES
Cash received from sale of digital currencies		-			718,181
Net cash provided by investing activities		-			718,181

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock		-			827,396
Borrowings on convertible notes		70,000			175,000
Payments on convertible debt		-			(206,037	)
Net cash provided by financing activities		70,000			796,359

Foreign currency translation adjustment		(1,000	)		(1,216	)

Net change in cash and cash equivalents		(10,582	)		(26,770	)
Cash and cash equivalents, beginning of year		15,271			58,712
Cash and cash equivalents, end of year	$	4,689		$	31,942

Non-Cash Transactions:
Issuance of common stock for stock payable	$	694,983		$	1,828,200
Stock issued for digital currencies		-			1,659,000
Stock issued for debt conversions		1,342,121			1,129,007
Beneficial conversion feature		70,000			143,325
Digital currency issued for AP settlement		-			15,080
Stock issued for debt discount		-			8,010
Stock retired for domain purchase		-			3,000
Stock issued for finder’s fee		-			1,000
Conversion of debt to common stock		-			-
Stock payable for accounts payable		427,434			-

6The accompanying ~~Table~~notes are an integral part of ~~Contents~~these consolidated financial statements.

~~DIGITALTOWN, INC. AND SUBSIDIARIES~~6

~~Notes~~DIGITALTOWN, INC. toAND ~~Consolidated Financial Statements~~SUBSIDIARIES

~~May~~Notes to ~~31,~~Consolidated ~~2019~~Financial Statements

~~Note~~August 31, ~~1. Basis of Presentation~~2019

~~The accompanying unaudited consolidated financial information has been prepared by DigitalTown, Inc~~Note 1. ~~(the~~Basis ~~“Company”) in accordance with accounting principles generally accepted in the United States~~ of America (“U.S.”) (“U.S. GAAP”) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”). Accordingly, it does not include all of the information and notes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of this financial information have been included. Financial results for the interim period presented are not necessarily indicative of the results that may be expected for the fiscal year as a whole or any other interim period. This financial information should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended February 28, 2019.Presentation

The accompanying ~~Company’s~~unaudited ~~fiscal~~consolidated ~~year~~financial ~~end~~information ishas been prepared by DigitalTown, Inc. (the ~~last~~“Company”) ~~day~~in accordance with accounting principles generally accepted in ~~February.~~the ~~Our~~United ~~current~~States ~~fiscal~~of ~~year~~America ~~ends~~(“U.S.”) on(“U.S. ~~February~~GAAP”) for ~~29,~~interim ~~2020~~financial information and wethe ~~refer~~instructions to itForm as10-Q ~~“fiscal~~and ~~2020~~Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”). ~~Last~~Accordingly, ~~year~~it does not include all of the information and notes required by U.S. GAAP for complete financial statements. In the opinion of management, ~~our~~all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of this financial information have been included. Financial results for the interim period presented are not necessarily indicative of the results that may be expected for the fiscal year ~~ended~~as ona ~~February~~whole ~~28,~~or ~~2019~~any other interim period. This financial information should be read in conjunction with the audited consolidated financial statements and wenotes ~~refer~~included toin ~~this~~the Company’s Annual Report on Form 10-K for the year asended ~~“fiscal~~February 28, 2019”.

~~Note~~The Company’s 2fiscal year end is the last day in February. ~~Nature~~Our ofcurrent ~~Business~~fiscal year ends on February 29, 2020 and ~~Summary~~we ofrefer ~~Significant~~to it ~~Accounting~~as ~~Policies:~~“fiscal 2020”. Last year, our fiscal year ended on February 28, 2019 and we refer to this year as “fiscal 2019”.

Note 2. Nature of Business and Summary of Significant Accounting Policies:

~~The Company was founded in 1982 under the laws~~ Nature of the State of Minnesota as Command Small Computer Learning Center, Inc., a computer training company and operated under several different names in the computer hardware and training sector. In 2005, the Company began acquiring domain names. On March 1, 2007, the Company changed its name to DigitalTown, Inc. and began developing a business plan to develop a platform to monetize their domain names. DigitalTown currently provides turn-key hosted solutions to power a comprehensive platform for government entities, citizens and merchants. The easy to use platform helps city officials and local merchants manage a feature-rich Smart City for web and mobile devices and provides residents and visitors with access to Content, Community and Commerce. The Company’s headquarters are located in Blaine, WA. The Company’s common stock is traded on the OTC Markets under the ticker symbol of DGTW.Business

The Company’s ~~consolidated~~was ~~financial~~founded ~~statements~~in ~~have~~1982 ~~been~~under ~~prepared~~the ~~using~~laws ~~U.S.~~of ~~GAAP~~the ~~applicable~~State toof aMinnesota ~~going~~as ~~concern~~Command ~~which~~Small ~~contemplates~~Computer ~~the~~Learning ~~realization~~Center, ofInc., ~~assets~~a computer training company and ~~liquidation~~operated ofunder ~~liabilities~~several different names in the ~~normal~~computer ~~course~~hardware ofand ~~business~~training sector. ~~The~~In 2005, the Company began ~~has~~acquiring adomain ~~working~~names. ~~capital~~On ~~deficit~~March 1, ~~recurring losses~~2007, ~~and~~the ~~negative~~Company ~~cash~~changed ~~flows~~its ~~from~~name ~~operations~~to DigitalTown, Inc. ~~These~~and ~~matters~~began ~~raise~~developing ~~substantial~~a ~~doubt~~business plan ~~about~~to ~~the~~develop ~~Company’s~~a ~~ability~~platform to ~~continue~~monetize astheir domain names. DigitalTown currently provides turn-key hosted solutions to power a comprehensive ~~going~~platform ~~concern~~for government entities, citizens and merchants. The ~~accompanying~~easy ~~consolidated~~to ~~financial~~use ~~statements~~platform dohelps ~~not~~city ~~include~~officials ~~any~~and ~~adjustments~~local merchants ~~relating~~manage toa ~~the~~feature-rich ~~recoverability~~Smart City for web and ~~classification~~mobile ofdevices ~~asset~~and ~~carrying~~provides ~~amounts~~residents orand ~~the~~visitors ~~amount~~with access to Content, Community and ~~classification~~Commerce. ofThe ~~liabilities~~Company’s ~~that~~headquarters ~~might~~are ~~result~~located ~~from~~in Blaine, WA. The Company’s common stock is traded on the ~~outcome~~OTC ofMarkets ~~this~~under ~~uncertainty.~~the ticker symbol of DGTW.

AtThe Company’s ~~May~~consolidated ~~31,~~financial ~~2019,~~statements ~~the~~have ~~Company~~been ~~had~~prepared anusing ~~accumulated~~U.S. ~~deficit~~GAAP ofapplicable ~~$56,847,889. The~~to ~~Company~~a ~~anticipates~~going ~~that~~concern ~~growth~~which ~~from~~contemplates the ~~its~~realization ~~operations,~~of ~~expected~~assets ~~future~~and ~~proceeds~~liquidation ~~from~~of ~~additional~~liabilities ~~financing~~in ~~through~~ the ~~sale~~normal course of ~~its~~business. ~~common~~The ~~stock~~Company orhas ~~other~~a ~~equity-based~~working ~~securities~~capital deficit, recurring losses, and ~~additional~~negative ~~sales~~cash ~~and/or~~flows ~~leases~~from ofoperations. ~~existing~~These ~~domain~~matters ~~names~~raise ~~will~~substantial bedoubt ~~sufficient~~about tothe ~~meet~~Company’s ~~its~~ability to ~~working~~continue ~~capital~~as ~~and~~a ~~capital~~going ~~expenditure~~concern. ~~needs~~The ~~through~~accompanying atconsolidated ~~least~~financial ~~February~~statements ~~29,~~do ~~2020.~~not Ininclude ~~the~~any ~~event~~adjustments ~~that~~relating to the ~~Company~~recoverability isand ~~unable~~classification toof ~~obtain~~asset ~~additional~~carrying ~~capital~~amounts inor the ~~future,~~amount ~~the~~and ~~Company~~classification ~~would~~of ~~reduce~~liabilities ~~operating~~that ~~expenses~~might orresult from ~~cease~~the ~~operations~~outcome ~~altogether~~of this uncertainty.

~~Principles~~At August 31, 2019, the Company had an accumulated deficit of ~~Consolidation~~$57,238,131. The Company anticipates that growth from its operations, expected future proceeds from additional financing through the sale of its common stock or other equity-based securities, and additional sales and/or leases of existing domain names will be sufficient to meet its working capital and capital expenditure needs through at least February 29, 2020. In the event that the Company is unable to obtain additional capital in the future, the Company would reduce operating expenses or cease operations altogether.

~~The consolidated financial statements include the accounts~~ Principles of DigitalTown, Inc. and its wholly-owned subsidiaries and have been prepared by the Company in United States (U.S.) dollars and in accordance with accounting principles generally accepted in the United States, or GAAP. All material intercompany accounts and transactions have been eliminated in consolidation.Consolidation

~~Reclassifications~~The consolidated financial statements include the accounts of DigitalTown, Inc. and its wholly-owned subsidiaries and have been prepared by the Company in United States (U.S.) dollars and in accordance with accounting principles generally accepted in the United States, or GAAP. All material intercompany accounts and transactions have been eliminated in consolidation.

Certain prior period amounts in the consolidated statement of cash flows have been reclassified to conform to the current period presentation. Proceeds from related party notes payable received in the prior period have been reclassified from the prior period classification. These reclassifications had no impact on previously reported net income or accumulated deficit for any year.Reclassifications

7Certain prior ~~Table~~period amounts in the consolidated statement of ~~Contents~~cash flows have been reclassified to conform to the current period presentation. Proceeds from related party notes payable received in the prior period have been reclassified from the prior period classification. These reclassifications had no impact on previously reported net income or accumulated deficit for any year.

~~Use of Estimates~~7

~~The preparation~~ Use of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S.”) 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 revenues and expenses during the reporting period. Actual results could differ from those estimates.Estimates

~~Accounts~~The preparation ~~Receivable~~of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S.”) 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 revenues and expenses during the reporting period. Actual results could differ from those estimates.

Accounts receivable arise from the software licensing of our Rezserve subsidiary. The Company evaluates collectability of accounts receivable based on a combination of factors including the age of the receivable or a specific customer’s inability to meet its financial conditions. In these circumstances, the Company records an allowance to reduce the receivable to an amount it deems collectible. The Company has recorded an allowance for doubtful accounts as of May 31, 2019 and February 28, 2019 of $0 and $5,308, respectively. Receivable

~~Goodwill~~Accounts receivable arise from the software licensing of our Rezserve subsidiary. The Company evaluates collectability of accounts receivable based on a combination of factors including the age of the receivable or a specific customer’s inability to meet its financial conditions. In these circumstances, the Company records an allowance to reduce the receivable to an amount it deems collectible. The Company has recorded an allowance for doubtful accounts as of August 31, 2019 and ~~Intangible~~February ~~Assets~~28, 2019 of $0 and $5,308, respectively.

Goodwill ~~represents the excess of purchase price over the fair value of net tangible~~ and ~~identifiable~~Intangible ~~intangible assets related to completed acquisitions. Goodwill has an indefinite life and is not amortized but instead tested for impairment annually, or more frequently if necessary.~~Assets

~~Intangible~~Goodwill represents ~~assets~~the ~~are~~excess ~~recorded~~of atpurchase ~~fair~~price ~~value~~over ~~and~~the ~~are~~fair ~~comprised~~value of ~~amounts~~net ~~assigned~~tangible ~~to acquisition-related items, such as trade names, customer lists, non-compete agreements~~ and ~~intellectual~~identifiable ~~property/technology. Intangible assets are considered either definite or indefinite lived assets. Definite lived~~ intangible assets ~~are~~related ~~amortized~~to ~~on a straight-line basis over their useful lives~~completed acquisitions. ~~Certain~~Goodwill ~~intangible~~has ~~assets may have~~ an indefinite life and ~~are~~is not amortized, but ~~rather~~instead ~~evaluated~~tested for impairment annually, or more frequently if necessary.

WeIntangible assets ~~evaluate~~are ~~any~~recorded ~~goodwill~~at ~~and~~fair ~~intangible~~value ~~assets~~and ~~for~~are ancomprised ~~impairment~~of onamounts anassigned ~~annual~~to ~~basis~~acquisition-related ~~each~~items, ~~fiscal~~such ~~year~~as ~~end.~~trade Wenames, ~~also~~customer lists, ~~evaluate~~non-compete ~~goodwill~~agreements and ~~intangible~~intellectual ~~assets~~property/technology. ~~for~~Intangible ~~impairment~~assets ~~between~~are ~~annual~~considered ~~tests~~either ifdefinite ~~an event occurs~~ or ~~circumstances~~indefinite lived ~~change~~assets. ~~that~~Definite ~~would~~lived ~~more~~intangible ~~likely~~assets ~~than~~are ~~not~~amortized ~~reduce~~on ~~the~~a ~~fair~~straight-line ~~value~~basis ofover ~~the~~their ~~goodwill~~useful ~~and~~lives. ~~intangible~~Certain intangible assets ~~below~~may ~~the~~have ~~carrying~~an ~~amounts.~~indefinite ~~The~~life ~~Company~~and ~~had~~are nonot ~~goodwill~~amortized, orbut ~~intangible~~rather ~~assets~~evaluated infor ~~fiscal~~impairment ~~2019 or in the first quarter of fiscal 2020~~annually.

~~Revenue~~We evaluate ~~Recognition~~any goodwill and intangible assets for an impairment on an annual basis each fiscal year end. We also evaluate goodwill and intangible assets for impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the goodwill and intangible assets below the carrying amounts. The Company had no goodwill or intangible assets in fiscal 2019 or in the first six months of fiscal 2020.

~~Effective March 1, 2018, the Company adopted ASC 606 —~~ Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.

~~There~~Effective March ~~was~~1, no2018, ~~impact~~the onCompany adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company’s ~~financial~~recognizes revenue ~~statements~~from asthe acommercial ~~result~~sales of ~~adopting~~products, ~~Topic~~licensing ~~606~~agreements ~~for~~and contracts to perform pilot studies by applying the ~~twelve~~following steps: ~~months~~(1) ~~ended~~identify ~~February~~the 28contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, ~~2019~~revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.

~~The~~There was no impact on the Company’s ~~recognizes~~financial ~~revenue~~statements ~~when~~as ~~the~~a ~~following~~result ~~five~~of ~~criteria~~adopting ~~have~~Topic ~~been~~606 ~~met:~~for the twelve months ended February 28, 2019.

·The Company ~~Identify~~recognizes ~~the~~revenue ~~contract~~when ~~with a customer · Identify~~ the ~~performance~~following ~~obligations~~five incriteria ~~the~~have ~~contract~~been ~~· Determine the transaction price · Allocate the transaction price to each performance obligation in the contract · Recognize revenue when each performance obligation is satisfied~~met:

~~The~~● ~~Company~~Identify ~~primarily~~the ~~recognizes~~contract ~~revenue~~with ~~from~~a ~~sale~~customer of● ~~software~~Identify ~~licenses~~the ~~and~~performance ~~related~~obligations ~~development~~in ~~services.~~the ~~Software~~contract ~~licensing~~● ~~and~~Determine ~~development~~the ~~revenue~~transaction isprice ~~recognized~~● asAllocate ~~invoiced and over~~ the ~~course~~transaction ofprice ~~the~~to ~~applicable~~each ~~agreements.~~performance Inobligation in the ~~event~~contract ~~projects~~● ~~have~~Recognize ~~multiple project milestones,~~ revenue iswhen ~~recognized~~each asperformance ~~milestones~~obligation ~~are~~is ~~achieved and invoices are submitted for payment.~~satisfied

The Company ~~may~~primarily ~~also~~recognizes berevenue ~~merchant~~from sale of ~~record~~software ~~for~~licenses ~~merchant~~and ~~transactions~~related ~~processed~~development ~~on the DigitalTown platform~~services. ~~When~~Software ~~this~~licensing ~~happens,~~and development revenue is recognized onas ~~the~~invoiced ~~date~~and ofover the ~~transaction.~~course ~~The~~of ~~Company~~the ~~has~~applicable ~~experience in merchant transaction fraud mitigation~~agreements. ToIn the ~~extent~~event ~~chargebacks~~projects ~~become~~have ~~material~~multiple project milestones, ~~the~~revenue ~~Company~~is ~~will~~recognized ~~implement~~as amilestones ~~formal~~are ~~practice~~achieved ~~for~~and ~~allowance~~invoices ~~for~~are ~~doubtful~~submitted ~~accounts~~for payment.

8The Company ~~Table~~may also be merchant of ~~Contents~~record for merchant transactions processed on the DigitalTown platform. When this happens, revenue is recognized on the date of the transaction. The Company has experience in merchant transaction fraud mitigation. To the extent chargebacks become material, the Company will implement a formal practice for allowance for doubtful accounts.

~~Fair Value of Financial Instruments~~8

~~Under~~Fair Value Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (ASC) 820-10-5, fair value is defined 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 (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of ~~fair~~Financial value measurements and the related disclosures. Under U.S. GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value.Instruments

AsUnder Financial ofAccounting ~~May~~Standards ~~31,~~Board ~~2019~~(“FASB”) ~~and~~Accounting ~~February~~Standards ~~28,~~Codification ~~2019~~(ASC) 820-10-5, fair value is defined as the ~~Company~~price ~~does~~that ~~not~~would ~~have~~be ~~any~~received ~~financial~~to ~~instruments~~sell ~~that~~an ~~must~~asset beor ~~measured~~paid ~~under~~to transfer a liability in an orderly transaction between market participants at the ~~fair~~measurement ~~value~~date ~~standard~~(an exit price). The ~~Company’s~~standard ~~financial~~outlines ~~assets~~a valuation framework and ~~liabilities~~creates ~~are~~a ~~measured~~fair ~~using~~value ~~inputs~~hierarchy in ~~from~~order to increase the ~~three~~consistency ~~levels~~and comparability of fair value measurements and the related disclosures. Under U.S. GAAP, certain assets and liabilities must be measured at fair value, ~~hierarchy.~~and ~~The~~FASB ~~three~~ASC ~~levels~~820-10-50 details the disclosures that are asrequired for ~~follows:~~items measured at fair value.

~~Level~~As of 1August -31, ~~Inputs~~2019 ~~are~~and ~~unadjusted~~February ~~quoted~~28, ~~prices~~2019, inthe ~~active~~Company ~~markets~~does ~~for~~not ~~identical~~have ~~assets~~any orfinancial ~~liabilities~~instruments that must be measured under the fair value standard. The Company’s ~~has~~financial ~~the~~assets ~~ability~~and toliabilities ~~access~~are atmeasured using inputs from the ~~measurement~~three ~~date~~levels of the fair value hierarchy. The three levels are as follows:

Level 1 2 - Inputs ~~include~~are unadjusted quoted prices ~~for similar assets and liabilities~~ in active markets, ~~quoted prices~~ for identical ~~or similar~~ assets or liabilities ~~in markets~~ that ~~are~~the ~~not~~Company ~~active,~~has ~~inputs~~the ~~other~~ability to ~~than~~access ~~quoted~~at ~~prices that are observable for~~ the ~~asset~~measurement ~~or liability (e~~date.~~g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).~~

Level 2 3 - ~~Unobservable~~Inputs ~~inputs~~include ~~that~~quoted ~~reflect~~prices ~~the~~for ~~Company’s~~similar ~~assumptions~~assets ~~about~~and ~~the~~liabilities ~~assumptions~~in ~~that~~active ~~market~~markets, ~~participants~~quoted ~~would~~prices ~~use~~for identical or similar assets or liabilities in ~~pricing~~markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

~~There~~Level 3 ~~were~~- noUnobservable ~~transfers~~inputs ofthat ~~financial~~reflect ~~assets~~the orCompany’s ~~liabilities~~assumptions ~~between~~about ~~Level~~the 1assumptions ~~and~~that ~~Level~~market 2participants ~~inputs~~would ~~during~~use in pricing the ~~first~~asset ~~quarter of fiscal 2020~~ or ~~the fiscal year 2019~~liability.

~~Cash~~There were ~~Equivalents~~no transfers of financial assets or liabilities between Level 1 and Level 2 inputs during the first quarter of fiscal 2020 or the fiscal year 2019.

The Company considers all highly liquid investments with original maturity of three months or less when purchased to be cash equivalents. As of May 31, 2019 and February 28, 2019, the Company had no cash equivalents.Cash Equivalents

~~Cash~~The Company ~~Deposits~~considers inall ~~Excess~~highly liquid investments with original maturity of ~~Federally~~three ~~Insured~~months ~~Limits~~or less when purchased to be cash equivalents. As of August 31, 2019 and February 28, 2019, the Company had no cash equivalents.

~~The~~Cash Deposits ~~Company maintains its cash~~ in ~~bank~~Excess deposit accounts which, at times, may exceed federally insured limits. Accounts are insured by the Federal Deposit Insurance Company and currently have insurance coverage up to $250,000. At May 31, 2019 and February 28, 2019, the Company did not have any deposit accounts in excess of ~~federally~~Federally ~~insured~~Insured ~~limits.~~ Limits

~~Prepaid~~The Company ~~Domain~~maintains ~~Names~~its cash in bank deposit accounts which, at times, may exceed federally insured limits. Accounts are insured by the Federal Deposit Insurance Company and currently have insurance coverage up to $250,000. At August 31, 2019 and February 28, 2019, the Company did not have any deposit accounts in excess of federally insured limits.

~~The~~Prepaid Domain ~~annual domain name renewal fees are capitalized in the period of renewal then amortized over one year. Only the purchase of new domain names is capitalized. See Note 5 for further information.~~Names

~~Property~~The annual ~~and~~domain ~~Equipment~~name renewal fees are capitalized in the period of renewal then amortized over one year. Only the purchase of new domain names is capitalized. See Note 5 for further information.

Property and equipment are stated at cost and depreciated on a straight-line basis over their estimated useful lives, ranging from three to five years. Leasehold improvements are amortized over the shorter of the useful life or the term of the related lease. The Company recorded $0 and $1,842 of depreciation expense for first quarters of fiscal years 2020 and 2019, respectively. Repairs and maintenance costs are expensed as incurred; major renewals and improvements are capitalized. As items of property or equipment are sold or retired, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is included in operating income. All office and equipment was disposed in the first quarter of fiscal 2020, which resulted in a loss on disposal of $19,208. See Note 4 for further information.Equipment

9Property and ~~Table~~equipment are stated at cost and depreciated on a straight-line basis over their estimated useful lives, ranging from three to five years. Leasehold improvements are amortized over the shorter of ~~Contents~~the useful life or the term of the related lease. The Company recorded $0 and $3,885 of depreciation expense for the first two quarters of fiscal years 2020 and 2019, respectively. Repairs and maintenance costs are expensed as incurred; major renewals and improvements are capitalized. As items of property or equipment are sold or retired, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is included in operating income. All property and equipment was disposed of in the first quarter of fiscal 2020, which resulted in a loss on disposal of $19,208. See Note 4 for further information.

Income Taxes

Deferred tax assets (net of any valuation allowance) and liabilities resulting from temporary differences, net operating loss carryforwards and tax credit carryforwards are recorded using an asset-and-liability method. Deferred taxes relating to temporary differences and loss carryforwards are measured using the tax rate expected to be in effect when they are reversed or are realized. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be ultimately realized. The Company has recorded a full valuation allowance against the net deferred tax asset due to the uncertainty of realizing the related future benefits.

The Company accounts for income taxes pursuant to FASB guidance. This guidance prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company believes its income tax filing positions and deductions will be sustained upon examination and, accordingly, no reserves or related accruals for interest and penalties have been recorded at May 31, 2019 or February 28, 2019. In accordance with the FASB guidance, the Company has adopted a policy under which, if required to be recognized in the future, interest related to the underpayment of income taxes will be classified as a component of interest expense and any related penalties will be classified in operating expenses in the statements of operations. The Company has three open years of tax returns subject to examination.9

~~Stock-Based~~Valuation allowances ~~Compensation,~~are ~~Including~~established ~~Options~~when ~~and~~necessary ~~Warrants~~to reduce deferred tax assets to the amount expected to be ultimately realized. The Company has recorded a full valuation allowance against the net deferred tax asset due to the uncertainty of realizing the related future benefits.

~~Use~~The Company ofaccounts ~~equity~~ for ~~compensation~~income istaxes apursuant ~~material~~to ~~part~~FASB ofguidance. ~~the~~This ~~Company’s~~guidance ~~near-term~~prescribes ~~strategy.~~a ~~The~~recognition ~~Company~~threshold ~~recognizes~~and a measurement attribute for the ~~cost~~financial statement recognition and measurement of ~~stock-based~~tax ~~compensation~~positions ~~plans~~taken ~~and~~or ~~awards~~expected to be taken in ~~operations~~a ontax return. For those benefits to be recognized, a ~~straight-line~~tax ~~basis~~position ~~over~~must ~~the~~be ~~respective~~more ~~vesting~~likely ~~period~~than ofnot ~~the~~to ~~awards.~~be sustained upon examination by taxing authorities. The Company ~~measures~~believes ~~and~~its ~~recognizes~~income ~~compensation~~tax ~~expense~~filing ~~for~~positions ~~all~~and ~~stock-based~~deductions ~~payment~~will ~~awards~~be ~~made~~sustained toupon ~~employees~~examination and, ~~directors~~accordingly, ~~consultants~~no reserves or related accruals for interest and ~~advisors~~penalties have been recorded at August 31, 2019 or February 28, 2019. ~~The~~In ~~compensation~~accordance ~~expense~~with the ~~for~~FASB guidance, the Company’s ~~stock-based~~has ~~payments~~adopted isa ~~based~~policy onunder ~~estimated~~which, ~~fair~~if ~~values~~required atto be recognized in the ~~time~~future, interest related to the underpayment of income taxes will be classified as a component of interest expense and any related penalties will be classified in operating expenses in the ~~grant~~statements of operations. The Company has three open years of tax returns subject to examination.

~~The Company estimates the fair value of stock~~Stock-~~based payment awards on the date of grant using the Black-Scholes option pricing model. This option pricing model involves a number of assumptions~~Based Compensation, ~~including~~Including ~~the~~Options ~~expected lives of stock options, the volatility of the public market price for the Company’s common stock~~ and ~~interest rates. Stock-based compensation expense recognized during the period is based on the value of the portion of stock-based payment awards that are ultimately expected to vest.~~Warrants

~~Recently~~Use of ~~Issued~~equity ~~Accounting~~for ~~Pronouncements~~compensation is a material part of the Company’s near-term strategy. The Company recognizes the cost of stock-based compensation plans and awards in operations on a straight-line basis over the respective vesting period of the awards. The Company measures and recognizes compensation expense for all stock-based payment awards made to employees, directors, consultants and advisors. The compensation expense for the Company’s stock-based payments is based on estimated fair values at the time of the grant.

InThe Company ~~May~~estimates ~~2014,~~ the ~~FASB~~fair ~~issued~~value ~~ASU~~of ~~No. 2014~~stock-~~09,~~based ~~Revenue~~payment ~~from~~awards ~~Contracts~~on ~~with~~the ~~Customers~~date ~~(Accounting~~of ~~Standards~~grant ~~Codification~~using ~~606~~the ~~(“ASC 606”)). ASU No. 2014~~Black-09Scholes ~~provides~~option ~~guidance~~pricing ~~for revenue recognition~~model. This ~~The~~option ~~standard’s~~pricing ~~core~~model ~~principle~~involves ~~is that~~ a ~~company~~number ~~will~~of ~~recognize~~assumptions, ~~revenue~~including ~~when~~the itexpected ~~transfers~~lives ~~promised~~of ~~goods~~stock oroptions, ~~services to customers in an amount that reflects~~ the ~~consideration~~volatility toof ~~which~~ the public ~~company~~market ~~expects~~price ~~to be entitled in exchange~~ for ~~those~~the ~~goods~~Company’s orcommon ~~services.~~stock ~~In doing so, companies will need to use more judgment~~ and ~~make~~interest ~~more estimates than under current guidance~~rates. ~~These~~Stock-based ~~may~~compensation ~~include~~expense ~~identifying~~recognized ~~performance obligations in~~ during the ~~contract~~period ~~and~~is ~~estimating~~based on the ~~amount~~value of ~~variable consideration to include in~~ the ~~transaction~~portion ~~price~~of ~~attributable~~stock-based topayment ~~each~~awards ~~separate~~that ~~performance~~are ~~obligation.~~ultimately ~~Subsequent~~expected to ~~the initial standards, the FASB has also issued several ASUs to clarify specific revenue recognition topics~~vest. ~~This guidance is effective for the Company for its fiscal year 2019.~~

~~The~~Recently Issued ~~Company~~Accounting adopted using the modified retrospective approach to initially apply the update and recognize the remaining contract value at the date of application. The Company does not expect the adoption of ASU 2014-09 to have any impact on its total cash flows from operating, investing or financing activities.Pronouncements

In May ~~January 2017~~2014, the FASB issued ASU ~~2017~~No. 2014-0409, ~~Simplifying~~Revenue ~~the~~from ~~Test~~Contracts ~~for~~with ~~Goodwill~~Customers ~~Impairment,~~(Accounting ~~which~~Standards ~~removes~~Codification ~~the~~606 ~~second step of the two-step goodwill impairment test~~(“ASC 606”)). ~~Under~~ ASU ~~2017-04,~~No. ~~an entity will apply a one~~2014-~~step~~09 ~~quantitative~~provides ~~test~~guidance ~~and~~for ~~record~~revenue ~~the~~recognition. ~~amount~~The ofstandard’s ~~goodwill~~core ~~impairment~~principle asis ~~the~~that ~~excess of~~ a ~~reporting~~company will ~~unit’s~~recognize ~~carrying~~revenue ~~amount~~when ~~over~~it ~~its~~transfers ~~fair~~promised ~~value,~~goods ~~not~~or services to ~~exceed~~customers ~~the~~in ~~total~~an amount ofthat ~~goodwill~~reflects ~~allocated~~the consideration to which the ~~reporting~~company ~~unit.~~expects ~~ASU~~to ~~2017-04~~be ~~does~~entitled ~~not~~in ~~amend~~exchange ~~the~~for ~~optional~~those ~~qualitative~~goods ~~assessment~~or ofservices. ~~goodwill~~In ~~impairment.~~doing ~~Additionally~~so, ancompanies ~~entity~~will ~~should~~need ~~consider~~to ~~income~~use ~~tax~~more judgment ~~effects~~and ~~from~~make ~~any~~more ~~tax-deductible~~estimates ~~goodwill~~than onunder ~~the~~current ~~carrying~~guidance. ~~amount~~These ofmay ~~the~~include ~~reporting~~identifying ~~unit~~performance ~~when~~obligations ~~measuring~~in the ~~goodwill~~contract and ~~impairment~~estimating ~~loss,~~the ifamount ~~applicable.~~of ~~ASU~~variable ~~2017-04~~consideration isto ~~effective~~include ~~for~~in ~~annual~~the ortransaction ~~any~~price ~~interim~~attributable ~~goodwill~~to ~~impairment~~each ~~tests~~separate inperformance obligation. ~~fiscal~~Subsequent ~~years~~to ~~beginning~~the ~~after~~initial ~~December 15~~standards, ~~2019;~~the ~~early~~FASB ~~adoption~~has isalso ~~permitted~~issued ~~for~~several ~~interim~~ASUs orto ~~annual~~clarify ~~goodwill~~specific ~~impairment~~revenue ~~tests performed on testing dates after January 1, 2017~~recognition topics. ~~The~~This ~~Company~~guidance ~~has not elected early adoption of this standard and~~ is ~~currently~~effective infor the ~~process~~Company offor ~~evaluating~~its ~~the~~fiscal ~~impact~~year ~~of adopting ASU 2017-04 and cannot currently estimate the financial statement impact of adoption~~2019.

InThe Company ~~May~~adopted ~~2017,~~using the ~~FASB~~modified ~~issued~~retrospective ~~ASU~~approach ~~No.~~to ~~2017-09,~~initially ~~“Compensation~~apply –the ~~Stock Compensation (Topic 718): Scope of Modification Accounting.” The amendments in this~~ update ~~provide~~and ~~guidance~~recognize ~~about~~the ~~which~~remaining ~~changes~~contract tovalue at the ~~terms~~date ~~or conditions~~ of ~~a share-based award require an entity to apply modification accounting in Topic 718~~application. The ~~guidance~~Company ~~will~~does benot ~~effective~~expect ~~for~~ the ~~Company for its fiscal year 2018, with early~~ adoption ~~permitted.~~of ~~The~~ASU ~~Company~~2014-09 ~~does~~to ~~not~~have ~~expect~~any ~~this~~impact ~~ASU~~on toits ~~materially~~total ~~impact~~cash ~~the~~flows from ~~Company’s~~operating, ~~consolidated~~investing ~~financial~~or ~~statements.~~financing activities.

10In January ~~Table~~2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment, which removes the second step of ~~Contents~~the two-step goodwill impairment test. Under ASU 2017-04, an entity will apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. ASU 2017-04 does not amend the optional qualitative assessment of goodwill impairment. Additionally, an entity should consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. ASU 2017-04 is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019; early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company has not elected early adoption of this standard and is currently in the process of evaluating the impact of adopting ASU 2017-04 and cannot currently estimate the financial statement impact of adoption.

In May ~~February 2016~~2017, the FASB issued ~~Accounting Standards Update (“~~ASU”) ~~2016-02, ”Leases (Topic 842)”~~No. ~~Under this guidance~~2017-09, an“Compensation ~~entity~~– isStock ~~required~~Compensation to(Topic ~~recognize~~718): ~~right-~~Scope of~~-use~~ ~~assets~~Modification ~~and lease liabilities on its balance sheet and disclose key information about leasing arrangements~~Accounting.” The ~~This~~amendments ~~guidance~~in ~~offers~~this ~~specific~~update ~~accounting~~provide guidance ~~for~~about awhich ~~lessee,~~changes ~~a lessor and sale and leaseback transactions. Lessees and lessors are required~~ to ~~disclose~~the ~~qualitative~~terms ~~and~~or ~~quantitative~~conditions ~~information~~of ~~about leasing arrangements to enable~~ a ~~user~~share-based ofaward ~~the~~require ~~financial~~an entity ~~statements~~ to ~~assess~~apply ~~the~~modification ~~amount,~~accounting ~~timing~~in ~~and~~Topic ~~uncertainty of cash flows arising from leases~~718. ~~This~~The guidance iswill be effective for ~~annual~~the ~~reporting~~Company ~~periods~~for ~~beginning~~its ~~after December~~fiscal ~~15,~~year 2018, ~~including interim periods within that reporting period, and requires a modified retrospective adoption,~~ with early adoption permitted. The Company does not expect ~~the~~this ~~adoption~~ASU to ~~have~~materially ~~a material~~ impact onthe ~~its~~Company’s consolidated financial statements ~~upon adoption~~.

~~The Company believes there are no other new pronouncements that have been issued that might have a material impact on its financial position or results of operations.~~10

~~Note~~In February 32016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, “Leases (Topic 842)”. ~~Going~~Under this ~~Concern~~guidance, an entity is required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. This guidance offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. This guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period, and requires a modified retrospective adoption, with early adoption permitted. The Company adopted this standard in the first quarter of fiscal 2020, and did not have a material impact on its consolidated financial statements, nor does it expect to going forward.

The Company’s ~~consolidated~~believes ~~financial~~there ~~statements~~are ~~have~~no ~~been~~other ~~prepared~~new ~~using~~pronouncements ~~U.S.~~that ~~GAAP~~have ~~applicable~~been toissued athat ~~going~~might ~~concern~~have ~~which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has~~ a ~~working~~material ~~capital~~impact ~~deficit,~~on ~~recurring~~its ~~losses, and negative cash flows from operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying consolidated~~ financial position ~~statements do not include any adjustments related to the recoverability and classification of asset carrying amounts~~ or ~~the~~results ~~amount and classification~~ of ~~liabilities that might result from the outcome of this uncertainty~~operations.

~~At May 31, 2019, the Company had an accumulated deficit of $56,847,889~~Note 3. ~~The~~Going Company anticipates growth from its operations, expected future proceeds from additional financing through the sale of its common stock or other equity-based securities, and additional sales and/or leases of existing domain names will be sufficient to meet its working capital and capital expenditure needs through at least May 31, 2019. In the event that the Company is unable to obtain additional capital in the future, the Company would further reduce expenses or cease operations altogether.Concern

~~Note~~The Company’s 4consolidated financial statements have been prepared using U.S. ~~Property~~GAAP applicable to a going concern which contemplates the realization of assets and ~~Equipment~~liquidation of liabilities in the normal course of business. The Company has a working capital deficit, recurring losses, and negative cash flows from operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments related to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result from the outcome of this uncertainty.

~~Property~~At August 31, 2019, the Company had an accumulated deficit of $57,238,131. The Company anticipates growth from its operations, expected future proceeds from additional financing through the sale of its common stock or other equity-based securities, and ~~equipment~~additional sales ~~are~~and/or asleases ~~follows:~~of existing domain names will be sufficient to meet its working capital and capital expenditure needs through at least August 31, 2019. In the event that the Company is unable to obtain additional capital in the future, the Company would further reduce expenses or cease operations altogether.

	May 31,		February 28,
	2019		2019
Office equipment and furniture		-	$	47,914
Less accumulated depreciation		-		(28,706	)
Property and equipment, net		-	$	19,208

Note 4. Property and Equipment

~~Depreciation expense for the first quarter of fiscal years 2020~~ Property and ~~2019~~equipment ~~was~~are $0as ~~and $1,842, respectively.~~ follows:

All office and equipment was disposed in the first quarter of fiscal 2020, which resulted in a loss on disposal of $19,208.

	August 31, 2019		February 28, 2019
Office equipment and furniture		-	$	47,914
Less accumulated depreciation		-		(28,706	)
Property and equipment, net		-	$	19,208

~~Note~~Depreciation expense 5.for ~~Prepaid~~the ~~Domain~~first ~~Names~~two quarters of fiscal years 2020 and 2019 was $0 and $3,885, respectively.

~~During~~All office ~~the first quarters of fiscal years 2020~~ and ~~2019,~~equipment ~~the~~was ~~Company~~disposed ~~incurred~~in $0 and $19,001, respectively, of annual domain name renewal fees, specifically related to .CITY registrations. These amounts were recorded as prepaid domain name renewal fees, and are then amortized over one year on a straight-line basis. During the first ~~quarters~~quarter of fiscal ~~years~~ 2020 ~~and 2019~~, ~~the~~which ~~Company~~resulted ~~recognized~~in $0a ~~and~~loss ~~$54,574 of expense as cost of revenues related to this amortization. The Company had no remaining prepaid domain name renewal fees recorded~~ on ~~the~~disposal ~~balance sheet as~~ of ~~May 31~~$19, ~~2019 and February 28, 2019~~208.

11Note 5. ~~Table~~Prepaid ofDomain ~~Contents~~Names

~~Note~~During the 6first two quarters of fiscal years 2020 and 2019, the Company incurred $0 and $30,656, respectively, of annual domain name renewal fees, specifically related to .CITY ~~Accrued~~registrations. ~~Expenses~~These amounts were recorded as prepaid domain name renewal fees, and are ~~Deferred~~then ~~Revenue~~amortized over one year on a straight-line basis. During the first two quarters of fiscal years 2020 and 2019, the Company recognized $0 and $45,676 of expense as cost of revenues related to this amortization. The Company had no remaining prepaid domain name renewal fees recorded on the balance sheet as of August 31, 2019 and February 28, 2019.

Note 6. Accrued Expenses and Deferred Revenue

On December 5, 2016, Richard Pomije filed a lawsuit against the Company. Mr. Pomije asserts an employment agreement existed and a continuing obligation of the Company in the form of a monthly salary for a 1 year term from May 18, 2015 to May 17, 2016 was due in addition to a stock subscription receivable. Mr. Pomije claims the Company owes him $260,900, which had been fully accrued for by the Company at February 28, 2017. Accrued Expenses

On December ~~April 18~~5, ~~2018~~2016, ~~Mr.~~ Richard Pomije ~~was~~filed ~~granted~~ a ~~judgement for the~~ lawsuit ~~he filed~~ against the Company ~~on December 5, 2016~~. Mr. Pomije ~~was~~asserts ~~awarded~~an ~~$256,488~~employment asagreement ~~damages,~~existed and ~~$296,488 as attorney’s fees and costs, for~~ a continuing ~~total~~obligation ~~award~~ of ~~$552,976.~~the AsCompany atin ~~February~~the ~~28,~~form ~~2018,~~of ~~$552,976~~a ~~has~~monthly ~~been~~salary ~~accrued~~for asa ~~payable~~1 toyear ~~Mr.~~term ~~Pomije.~~from ~~During the quarter ending~~ May 3118, ~~2018,~~2015 ~~$10,910 was paid~~ to ~~Mr.~~May ~~Richard Pomije. As at February 28~~17, ~~2019,~~2016 ~~$542,066~~was ~~has~~due in ~~been~~addition ~~accrued~~to asa ~~payable~~stock tosubscription receivable. Mr. Pomije. ~~The~~claims the Company ~~filed~~owes anhim ~~appeal on June 13~~$260,900, ~~2018.~~which ~~See~~had ~~Note~~been 14fully accrued for ~~additional~~by ~~information about transactions between~~ the Company ~~and~~as ~~its~~of ~~former~~February ~~officer~~28, 2017.

~~Deferred Revenue~~11

~~During~~On April ~~fiscal~~18, ~~2019~~2018, ~~the~~Mr. ~~Company~~Richard ~~signed~~Pomije ~~one~~was ~~customer~~granted ~~agreement~~a tojudgement ~~build~~for ~~customized~~the ~~website~~lawsuit ~~and~~he ~~app~~filed ~~products.~~against ~~The~~the ~~pilot~~Company ~~project~~on ~~agreement~~December ~~consists~~5, of2016. ~~milestones~~Mr. Pomije ~~and~~was ~~completion~~awarded ~~metrics~~$256,488 toas ~~ensure~~damages, ~~that~~and ~~the~~$296,488 ~~requested~~as ~~services~~attorney’s ~~have~~fees ~~been~~and ~~performed~~costs, ~~satisfactorily~~for ~~and~~a tototal ~~the~~award ~~customers’~~of ~~full expectations~~$552,976. As During the ~~services~~quarter ~~requested~~ending byMay ~~the customers have not yet been completed~~31, ~~a total of $136~~2018,~~305~~ ~~and~~ $~~186~~10,~~305~~910 ~~have~~was ~~been~~paid ~~recorded~~to asMr. ~~deferred~~Richard ~~revenue~~Pomije. asAs ofat ~~May~~August 31, 2019, ~~and~~$542,066 ~~February~~has ~~28,~~been ~~2019,~~accrued ~~respectively~~as payable to Mr. Pomije.

~~During~~The Company ~~the~~filed ~~first~~an ~~quarter~~appeal ofon ~~fiscal~~June ~~2020~~13, ~~one~~2018. ofOn April 1, 2019, the ~~customer~~Court ~~agreements~~of ~~signed~~Appeals issued its Unpublished Opinion in ~~fiscal~~favor ~~2018~~of ~~was~~the Company ~~successfully~~with ~~completed,~~respect ~~and~~to ~~$50~~its appeal filed against Mr. Richard Pomije’s judgement on June 13,~~000~~ ~~previously~~2018. ~~recorded~~See asNote ~~deferred~~14 ~~revenue~~for ~~was~~additional information ~~recognized~~about astransactions ~~revenue~~between the Company and its former officer.

~~Domain Marketing Development Obligation~~Deferred Revenue

During fiscal 2019, the Company signed ~~top-level~~one ~~domain~~customer ~~marketing~~agreement ~~development~~to ~~fund~~build ~~agreements~~customized ~~with~~website ~~owners of 2 top level domains, whereby the Company markets~~ and ~~purchases~~app ~~domain names on behalf of the owners~~products. The ~~owner~~pilot ~~pays~~project usagreement consists anof ~~upfront~~milestones ~~deposit~~and tocompletion bemetrics ~~used~~ to ~~purchase~~ensure athat ~~predefined~~the ~~number~~requested ofservices ~~domains~~have ~~based~~been onperformed asatisfactorily ~~set schedule. As of May 31, 2019~~ and ~~February 28, 2019,~~ to the ~~Company~~customers’ ~~has~~full ~~collected $0 and $101,600, respectively, in cash related to these contracts~~expectations. As ~~some of~~ the services requested by the ~~owners~~customers have not yet been completed, a total of $~~168~~120,~~174~~000 and ~~has~~$186,305 have been recorded as ~~domain~~deferred ~~marketing~~revenue ~~development obligation~~ as of ~~May~~August 31, 2019 and February 28, 2019, respectively.

~~Note~~During the 7.first ~~Stockholders’~~quarter ~~Equity~~of fiscal 2020, one of the customer agreements signed in fiscal 2018 was successfully completed, and $50,000 previously recorded as deferred revenue was recognized as revenue.

~~The~~During the ~~Company’s~~second ~~primary~~quarter ~~means~~ of ~~generating~~fiscal ~~operating~~2020, ~~capital~~the ~~and~~customer ~~completing~~agreement ~~acquisitions~~signed ~~has~~in ~~been~~fiscal ~~through~~2019 ~~the~~was ~~use~~converted ofto ~~issuing~~stock ~~common~~payable, and $16,305 previously recorded as deferred revenue was recorded as stock. payable.

~~Fiscal~~Domain Marketing ~~2020~~Development ~~Stock Transactions~~Obligation

During fiscal 2019, the ~~first~~Company ~~quarter~~signed top-level domain marketing development fund agreements with owners of ~~fiscal~~2 ~~2020~~top level domains, ~~FirstFire~~whereby the ~~Global~~Company ~~Opportunities~~markets ~~Fund~~and ~~LLC~~purchases ~~converted~~domain ~~$116,467~~names on behalf of the ~~principal~~owners. ~~amount~~The owner pays us an upfront deposit to be used to purchase a predefined number of ~~the~~domains ~~July~~based 10on a set schedule. As of August 31, ~~2018~~2019 ~~note~~and ~~into~~February ~~202~~28,~~400~~ 2019,~~000~~ ~~shares~~the Company has collected $0 and $101,600, respectively, in cash related to these contracts. As some of the ~~Company’s~~services ~~common~~requested ~~stock,~~by ~~leaving~~the aowners ~~principal~~have ~~balance~~not ~~due~~yet been completed, a total of $36168,~~347.~~174 ~~There~~has ~~was~~been norecorded ~~gain~~as ordomain ~~loss~~marketing ~~due~~development toobligation ~~the~~as ~~conversion~~of ~~being~~August ~~within~~31, ~~the~~2019 ~~terms~~and ofFebruary 28, ~~the note~~2019.

~~During~~Note 7. ~~the first quarter of fiscal 2020, Crown Bridge Partners, LLC converted $73,436 of the principal amount of the September 27, 2018 note into 175,270,000 shares of the Company~~Stockholders’s ~~common stock, leaving a principal balance due of $17,685. There was no gain or loss due to the conversion being within the terms of the note.~~Equity

~~During the first quarter of fiscal 2020, Auctus Fund, LLC converted $15,159 of the principal amount of the November 14, 2018 note into 56,327,000 shares of the~~ The Company’s ~~common~~primary ~~stock,~~means ~~leaving a principal balance due~~ of ~~$75,227.~~generating ~~There~~operating ~~was~~capital noand ~~gain~~completing oracquisitions ~~loss~~has ~~due~~been tothrough the ~~conversion~~use ~~being within the terms~~ of ~~the~~issuing common ~~note~~stock.

~~During the first quarter of fiscal~~ Fiscal 2020, ~~JSJ~~Stock Investments Inc. converted $31,251 of the principal amount of the October 22, 2018 note into 94,790,544 shares of the Company’s common stock, leaving a principal balance due of $28,249. There was no gain or loss due to the conversion being within the terms of the note.Transactions

During the first ~~quarter~~six months of fiscal 2020, ~~EMA~~FirstFire ~~Financial,~~Global Opportunities Fund LLC converted $27149,~~489~~426 of the principal amount of the July ~~October 22~~10, 2018 note into 71393,~~000~~400,000 shares of the Company’s common stock, leaving a principal balance due of $5028,~~511~~388. There was no gain or loss due to the conversion being within the terms of the note.

During the first ~~quarter~~six months of fiscal 2020, ~~PowerUp~~Crown ~~Lending~~Bridge ~~Group~~Partners, ~~Ltd.~~LLC converted $8570,~~000~~029 of the principal amount and $53,~~100~~407 in accrued interest of the September 1727, 2018 note into 50175,~~687~~270,~~798~~000 shares of the Company’s common stock, ~~fully~~leaving ~~extinguishing~~a ~~this~~principal ~~note~~balance due of $17,685. There was no gain or loss due to the conversion being within the terms of the note.

12During the ~~Table~~first six months of ~~Contents~~fiscal 2020, Auctus Fund, LLC converted $22,657 of the principal amount and $6,349 in accrued interest of the November 14, 2018 note into 205,128,492 shares of the Company’s common stock, leaving a principal balance due of $62,344. There was no gain or loss due to the conversion being within the terms of the note.

During the first ~~quarter~~six months of fiscal 2020, ~~PowerUp~~JSJ ~~Lending~~Investments ~~Group Ltd~~Inc. converted $5333,~~000~~160 of the principal amount ~~and $3,180 in accrued interest~~ of the October 2322, 2018 note into 65116,~~062~~000,~~290~~000 shares of the Company’s common stock, ~~fully~~leaving ~~extinguishing~~a ~~this~~principal ~~note~~balance due of $26,340. There was no gain or loss due to the conversion being within the terms of the note.

~~Fiscal~~During the ~~2019~~first ~~Stock~~six ~~Transactions~~months of fiscal 2020, EMA Financial, LLC converted $47,453 of the principal amount of the October 22, 2018 note into 251,000,000 shares of the Company’s common stock, leaving a principal balance due of $38,240. There was no gain or loss due to the conversion being within the terms of the note.

~~During fiscal 2019, the Company issued 36,266,251 shares of stock to various investors for stock payable of $1,828,200, cash of $1,070,545 and digital currencies of $1,659,000.~~ 12

During the first six months of fiscal ~~2019~~2020, ~~the~~PowerUp ~~Company~~Lending ~~issued~~Group 6Ltd. converted $85,~~716,932~~000 ~~shares~~of tothe ~~consultants~~principal amount and ~~employees~~$5,100 ~~for~~in ~~services~~accrued interest ~~provided~~of to the ~~Company.~~September ~~During~~17, ~~fiscal~~2018 ~~2019,~~note $1into 50,~~104~~687,~~832~~798 shares of the Company’s common stock, fully extinguishing this note. There was ~~expensed~~no ~~related~~gain or loss due to ~~these~~the ~~shares~~conversion being within the terms of the note.

In During the ~~fourth~~first ~~quarter~~six months of fiscal ~~2019~~2020, ~~the~~PowerUp ~~Company~~Lending ~~issued~~Group ~~252~~Ltd. converted $53,~~500~~000 ~~shares~~of ~~for~~the ~~conversion~~principal amount and $3,180 in accrued interest of ~~accounts~~the ~~payable~~October 23, 2018 note into 65,062,290 shares of ~~$19~~the Company’s common stock,~~200.~~ ~~The~~fully ~~issuance~~extinguishing ~~had~~this note. There was no gain or loss asdue to the ~~value~~conversion ofbeing within the ~~shares~~terms ~~equalled~~of the ~~accounts payable converted~~note.

OnDuring the ~~May~~first 9,six ~~2018,~~months ~~the~~of ~~Company~~fiscal ~~converted the $500~~2020,~~000~~ ~~convertible~~PowerUp ~~note~~Lending ~~with~~Group ~~Darvin~~Ltd. ~~Habben,~~converted ~~Chairman~~$9,500 ~~along~~of ~~with~~the ~~accrued~~principal ~~and~~amount ~~unpaid~~of ~~interest~~the ofJanuary ~~$38~~22,~~028,~~ to2019 note 5into 190,~~380~~000,~~274~~000 shares of ~~its~~the Company’s common stock, ~~fully~~leaving ~~extinguishing~~a ~~this~~principal ~~note.~~balance ~~The~~due ~~issuance~~of ~~had~~$3,000. There was no gain or loss asdue to the ~~value~~conversion ofbeing within the ~~shares~~terms ~~issued~~of ~~equalled~~ the ~~debt converted~~note.

OnDuring the ~~May~~first 9,six ~~2018~~months of fiscal 2020, ~~the~~Clint ~~Company~~Skidmore converted ~~the~~ $~~150~~110,000 ~~convertible~~of ~~note~~the ~~with~~principal ~~Darvin~~amount ~~Habben,~~of ~~Chairman~~the December 22, to2017 1convertible note into 4,~~500~~400,000 shares of ~~its~~the Company’s common stock, fully extinguishing this note. ~~The~~There ~~issuance~~was ~~had~~ no gain or loss asdue to the ~~value~~conversion ofbeing within the ~~shares~~terms ~~issued~~of ~~equalled~~ the ~~debt converted~~note.

OnDuring the ~~May~~first 9six months of fiscal 2020, ~~2018~~Dot London Domains converted $247,350 of the ~~Company~~principal ~~converted~~amount due on the ~~$100,000~~Epik ~~promissory~~Holdings Inc. note ~~with~~dated ~~Derek~~September ~~Schumann~~12, ~~Director,~~2018 tointo 14,~~000~~947,000 shares of ~~its~~the Company’s common stock. Additionally, ~~fully~~Minds ~~extinguishing~~and ~~this~~Machines ~~note.~~converted $496,508 ~~The~~of ~~issuance~~the ~~had~~principal noamount ~~gain~~due oron ~~loss~~the asEpik ~~the~~Holdings ~~value~~Inc. ofnote ~~the~~to ~~shares~~stock ~~issued~~payable. ~~equalled~~As at August 31, 2019, the ~~debt~~principal ~~converted~~due on this note was $21,342.

OnIn the ~~May~~first 9,six ~~2018,~~months ~~the~~of ~~Company~~fiscal ~~converted~~2020, the ~~$100,000~~Company ~~promissory~~issued ~~note with Greg Foss~~8, ~~Director~~068,690 toshares ~~1,000,000~~for ~~shares~~conversion of ~~its~~accounts ~~common~~payable ~~stock,~~of ~~fully extinguishing this note~~$403,434. The issuance had no gain or loss as the value of the shares ~~issued~~ equalled the ~~debt~~accounts payable converted. An additional $24,000 of accounts payable was converted to stock payable during the second quarter of fiscal 2020.

OnDuring the ~~May~~first 9,six ~~2018,~~months ~~the~~of ~~Company~~fiscal ~~converted~~2020, the ~~$100,000~~Company ~~promissory~~issued ~~note with Donovan~~51, ~~to 1~~927,~~000,000~~594 shares of ~~its~~the Company’s common stock, ~~fully~~for ~~extinguishing~~stock ~~this note. The issuance had no gain or loss as the value~~ payable of ~~the shares issued equalled the debt converted~~$473,591.

OnDuring the ~~May~~first 9,six ~~2018~~months of fiscal 2020, the Company issued ~~100~~2,~~000~~243,836 shares to ~~an employee as~~ a ~~finder’s~~former ~~fee.~~employee ~~The~~for ~~shares~~services ~~were~~provided ~~valued~~to atthe ~~$1,000~~Company. During ~~and~~the ~~was~~first ~~recorded~~six tomonths ~~additional~~of ~~paid~~fiscal in2020, ~~capital~~$221,392 ~~due~~was toexpensed ~~its~~ related ~~party~~to ~~nature~~these shares.

~~During~~In July 2019, the ~~first~~Company ~~quarter~~issued of51 ~~fiscal~~shares ~~2019,~~of the Company’s ~~sold~~preferred 2stock ~~domains~~to ~~valued~~Sam atCiacco $3with super-voting characteristics,~~000~~ to facilitate an increase of the Authorized Common Stock limit, from 2 to ~~one~~5 billion. The additional availability of shares allows the Company’s ~~shareholders~~to incontinue ~~exchange~~meeting ~~for~~its ~~15,000~~obligations ~~shares,~~and ~~which~~secure ~~were~~its ~~returned~~ability to ~~treasury~~fund minimum operating requirements.

~~During~~Fiscal 2019 ~~May~~Stock 2018, PowerUp Lending Group Ltd. converted $75,000 of the principal amount, plus $4,500 in accrued and unpaid interest, of the October 30, 2017 note into 1,277,498 shares of the Company’s common stock, fully extinguishing this note. There was no gain or loss due to the conversion being within the terms of the note.Transactions

During fiscal ~~June and July 2018~~2019, ~~PowerUp~~the ~~Lending~~Company ~~Group~~issued ~~Ltd. converted $58~~36,~~000~~266,251 shares of ~~the~~stock ~~principal~~to ~~amount,~~various ~~plus~~investors ~~$3,480~~for instock ~~accrued~~payable ~~and unpaid interest,~~ of ~~the November 30, 2017 note into~~ $1,~~139~~828,~~394~~200, ~~shares~~cash of ~~the Company’s common stock~~$1,070,545 and ~~fully~~digital ~~extinguishing~~currencies ~~this note. There was no gain or loss due to the conversion within the terms~~ of ~~the note~~$1,659,000.

During fiscal ~~January and February~~ 2019, ~~FirstFire Global Opportunities Fund LLC converted $30,565 of~~ the ~~principal~~Company ~~amount~~issued ~~of the July 10, 2018 note into~~ 6,~~516~~716,~~848~~932 shares ofto ~~the~~consultants ~~Company’s~~and ~~common~~employees ~~stock,~~for ~~leaving~~services aprovided ~~principal~~to ~~balance~~the ~~due~~Company. ofDuring fiscal 2019, $~~153~~1,~~185.~~104,832 ~~There~~ was noexpensed ~~gain~~related ~~or loss due~~ to ~~the~~these ~~conversion being within the terms of the note~~shares.

OnIn the ~~July~~fourth ~~10,~~quarter ~~2018~~of fiscal 2019, the Company issued 90252,~~000~~500 shares offor ~~its~~conversion ~~common~~of ~~stock,~~accounts ~~valued~~payable atof $819,~~010~~200. ~~based~~The onissuance had ~~the~~no ~~closing~~gain ~~market~~or ~~price~~loss onas the ~~date~~value of the ~~note~~shares ~~agreement,~~equalled tothe ~~FirstFire~~accounts ~~Global~~payable ~~Opportunities Fund LLC as consideration for improved terms and conditions on their July 10, 2018 convertible note~~converted. ~~The Company recorded a beneficial conversion feature of $143,325 with this note. See Note 13 for more information related to the convertible note.~~

13On May ~~Table~~9, 2018, the Company converted the $500,000 convertible note with Darvin Habben, Chairman, along with accrued and unpaid interest of ~~Contents~~$38,028, to 5,380,274 shares of its common stock, fully extinguishing this note. The issuance had no gain or loss as the value of the shares issued equalled the debt converted.

~~Stock~~On May ~~Warrants~~9, 2018, the Company converted the $150,000 convertible note with Darvin Habben, Chairman, to 1,500,000 shares of its common stock, fully extinguishing this note. The issuance had no gain or loss as the value of the shares issued equalled the debt converted.

~~The~~On May ~~Company~~9, ~~has~~2018, ~~regularly~~the ~~used~~Company ~~warrants~~converted asthe a$100,000 ~~tool~~promissory tonote ~~attract~~with ~~and~~Derek ~~compensate~~Schumann, ~~advisors~~Director, ~~and~~to ~~directors~~1,000,000 shares of ~~the~~its ~~board~~common stock, ~~rather~~fully ~~than~~extinguishing tothis ~~use cash~~note. The ~~Company~~issuance ~~feels~~had ~~this~~no isgain anor ~~appropriate~~loss ~~way~~as tothe ~~conserve~~value ~~cash~~of ~~and~~the toshares ~~incentivize~~issued ~~its~~equalled ~~board~~the ofdebt ~~directors, advisors and consultants~~converted.

As of May 31, 2019, the Company had 6,080,000 warrants outstanding with an average exercise price of $0.14. The warrants expire between one and ten years from the date of issuance and have a weighted average remaining exercise period as of May 31, 2019 of 7.46 years.13

~~The~~On May 9, 2018, the Company ~~did~~converted ~~not~~the ~~issue~~$100,000 ~~any~~promissory ~~warrants~~note ~~during~~with ~~the~~Greg ~~first~~Foss, ~~quarter~~Director, to 1,000,000 shares of ~~fiscal~~its ~~2020~~common stock, fully extinguishing this note. The issuance had no gain or loss as the value of the shares issued equalled the debt converted.

~~The~~On May ~~following~~9, ~~table~~2018, ~~summarizes~~the ~~information~~Company ~~about~~converted the ~~Company’s~~$100,000 promissory note with Donovan, to 1,000,000 shares of its common stock, ~~warrant~~fully ~~activity~~extinguishing this ~~during~~note. The issuance had no gain or loss as the ~~fiscal~~value ~~years~~of ~~2020~~the ~~and~~shares ~~2019:~~issued equalled the debt converted.

	Number of Warrants
Outstanding - February 28, 2018		9,044,740
Granted		-
Canceled or expired		(2,964,740	)
Outstanding - February 28, 2019		6,080,000
Granted		-
Canceled or expired		-
Outstanding - May 31, 2019		6,080,000
Exercisable at May 31, 2019		6,080,000

On May 9, 2018, the Company issued 100,000 shares to an employee as a finder’s fee. The shares were valued at $1,000 and was recorded to additional paid in capital due to its related party nature.

~~The~~During the ~~following~~first ~~table~~quarter ~~summarizes~~of ~~information~~fiscal ~~about~~2019, ~~stock~~the ~~warrants~~Company ~~outstanding~~sold as2 domains valued at $3,000 to one of ~~May~~the 31Company’s shareholders in exchange for 15,000 ~~2019:~~shares, which were returned to treasury.

Exercise Price	Number Outstanding	Weighted Average Remaining Life (years)	Weighted Average Exercise Price	Number Exercisable	Weighted Average Exercisable Price
$0.10	4,430,000	7.99	$0.10	4,430,000	$0.10
$0.15	300,000	5.85	$0.15	300,000	$0.15
$0.25	850,000	5.93	$0.25	850,000	$0.25
$0.30	500,000	6.28	$0.30	500,000	$0.30
$0.10 - $0.30	6,080,000	7.46	$0.14	6,080,000	$0.14

During May 2018, PowerUp Lending Group Ltd. converted $75,000 of the principal amount, plus $4,500 in accrued and unpaid interest, of the October 30, 2017 note into 1,277,498 shares of the Company’s common stock, fully extinguishing this note. There was no gain or loss due to the conversion being within the terms of the note.

~~Note~~During June 8and July 2018, PowerUp Lending Group Ltd. ~~Stock~~converted ~~Options~~$58,000 of the principal amount, plus $3,480 in accrued and unpaid interest, of the November 30, 2017 note into 1,139,394 shares of the Company’s common stock, fully extinguishing this note. There was no gain or loss due to the conversion within the terms of the note.

~~The~~During January ~~Company has one stock option plan called The 2006 Employee Stock~~ and ~~Option~~February ~~Plan~~2019, ~~(the~~FirstFire ~~“2006~~Global ~~Plan”),~~Opportunities ~~which~~Fund ~~has~~LLC ~~reserved~~converted 5$30,~~000,000~~565 ~~shares~~ of ~~our~~the ~~common~~principal ~~stock~~amount ~~for issuance. The types~~ of ~~awards that could be granted under~~ the ~~2006~~July ~~Plan include incentive and non-qualified options to purchase shares of common stock~~10, ~~stock~~2018 note ~~appreciation~~into ~~rights~~6,516,848 ~~restricted~~ shares, ~~restricted share units, performance awards and other types~~ of ~~stock-based awards. All grants are determined and approved by~~ the ~~Board of Directors. Through February 28, 2018, the~~ Company’s ~~has~~common ~~only granted non-qualified~~ stock, ~~options~~leaving ~~under~~a ~~the~~principal ~~2006~~balance ~~Plan.~~due ~~The stock options may be granted to officers and employees~~ of ~~the Company~~$153,185. ~~Options~~There ~~granted~~was ~~under~~no ~~the~~gain or ~~2006~~loss ~~Plan~~due ~~have~~to ~~exercise prices and vesting terms approved by~~ the ~~Board~~conversion ofbeing ~~Directors~~within at the ~~time of each grant. Vesting~~ terms of the ~~outstanding options range from immediate to four years from the date of grant~~note. ~~The exercise period of the options range from five to ten years from the date of grant.~~

~~The~~On July ~~Company~~10, ~~records~~2018, ~~its stock-based compensation arrangements calculating~~ the ~~fair~~Company ~~value~~issued ~~of share-based payments~~90,000 ~~including~~shares ~~grants~~ of ~~employee~~its ~~stock~~common ~~options and employee~~ stock, ~~purchase~~valued ~~plan~~at ~~shares~~$8,010 tobased beon ~~recognized in~~ the ~~consolidated~~closing ~~statements~~market ofprice ~~operations based~~ on ~~their grant~~ the date ~~fair values. The fair value~~ of the ~~Company’s~~note ~~stock~~agreement, ~~options~~to ~~have~~FirstFire ~~been~~Global ~~estimated~~Opportunities ~~using~~Fund ~~the~~LLC ~~Black-Scholes pricing model, which requires assumptions~~ as toconsideration ~~expected~~for ~~dividends,~~improved ~~the~~terms ~~options expected life, volatility~~ and ~~risk-free~~conditions ~~interest~~on ~~rate~~their July at10, ~~the~~2018 ~~time~~convertible ~~of the grant~~note. The ~~value~~Company ofrecorded ~~the~~a ~~portion~~beneficial ofconversion ~~the~~feature ~~award~~of ~~that~~$143,325 iswith ~~ultimately~~this ~~expected~~note. toSee ~~vest~~Note is13 ~~recognized~~for more asinformation ~~expense~~related onto ~~a straight-line basis over~~ the ~~requisite~~convertible ~~vesting periods in the Company’s consolidated statements of operations~~note.

~~The Company did not issue any stock options during the first quarter of fiscal 2020.~~Stock Warrants

14The Company ~~Table~~has regularly used warrants as a tool to attract and compensate advisors and directors of ~~Contents~~the board rather than to use cash. The Company feels this is an appropriate way to conserve cash and to incentivize its board of directors, advisors and consultants.

OnAs of ~~October~~August 131, ~~2018~~2019, the Company ~~issued~~had 26,~~468~~080,~~750~~000 ~~stock~~warrants ~~options~~outstanding with aan ~~fair~~average ~~value~~exercise price of $~~188,740~~0.14. toThe ~~three~~warrants ~~contractors~~expire between toone ~~purchase~~and ~~shares~~ten ofyears from the ~~Company’s~~date ~~common~~of ~~stock~~issuance atand have a ~~price~~weighted ofaverage ~~$0.05.~~remaining ~~These~~exercise ~~options~~period ~~vest~~as ~~immediately~~of ~~and~~August ~~are~~31, ~~exercisable~~2019 of ~~for~~7.20 ~~five~~ years.

~~On November 21, 2018, the~~ The Company ~~issued~~did ~~3,500,000~~not ~~stock~~issue ~~options~~any ~~with~~warrants aduring ~~fair value of $120,421 to three contractors to purchase shares of~~ the ~~Company’s~~first ~~common~~two ~~stock~~quarters ~~at a price~~ of ~~$0.05.~~fiscal ~~These options vest immediately and are exercisable for five years~~2020.

OnThe following ~~June~~table 1,summarizes ~~2018,~~information ~~the~~about ~~Company issued 3,555,212 stock options with a fair value of $436,131 to one employee to purchase shares of~~ the Company’s ~~common~~ stock atwarrant aactivity ~~price~~during ofthe ~~$0.10.~~fiscal ~~3,000,000 options vest immediately and are exercisable for five~~ years. ~~555,212~~2020 ~~options vest over 12 months,~~ and ~~are exercisable for five years. In the third quarter of fiscal~~ 2019, the Company expensed an additional $19,621 related to the proportioned vesting of the 555,212 options. The Company terminated this employee’s contract on November 30, 2018, resulting in only 276,845 of the 555,212 options vesting. The balance of 278,367 options have been forfeited.:

The Company utilized the following key assumptions in computing the fair value of the options using the Black-Scholes pricing model:

	Number of Warrants
Outstanding - February 28, 2018		9,044,740
Granted		-
Canceled or expired		(2,964,740	)
Outstanding - February 28, 2019		6,080,000

Granted		-
Canceled or expired		-
Outstanding - August 31, 2019		6,080,000
Exercisable at August 31, 2019		6,080,000

	June 1			June 1			October 1			November 21
	2018			2018			2018			2018
Weighted-average volatility		223	%		223	%		208	%		192	%
Expected dividends	None			None			None			None
Expected term (in years)		2.50			3.00			3.00			3.00
Weighted-average risk-free interest rate		2.61	%		2.61	%		2.96	%		2.89	%

The following ~~Company~~table ~~recorded~~summarizes ~~stock-based~~information ~~compensation~~about ~~expense~~stock ofwarrants ~~$0 and $0 for all~~ outstanding ~~options~~as ~~for~~of ~~fiscal~~August ~~quarter 2020 and fiscal year 2019~~31, ~~respectively.~~ 2019:

The following table summarizes information about the Company’s stock options as of May 31, 2019:

Exercise Price		Number Outstanding		Weighted Average Remaining Life (years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercisable Price
$	0.10		4,430,000		7.74	$	0.10		4,430,000	$	0.10
$	0.15		300,000		5.59	$	0.15		300,000	$	0.15
$	0.25		850,000		5.68	$	0.25		850,000	$	0.25
$	0.30		500,000		6.03	$	0.30		500,000	$	0.30
$	0.10 - $0.30		6,080,000		7.20	$	0.14		6,080,000	$	0.14

	Number of Options			Weighted Average Exercise Price
Outstanding - February 28, 2018		6,235,159		$	0.16
Granted		9,523,962		$	0.07
Canceled or expired		(1,035,159	)	$	0.10
Outstanding - February 28, 2019		14,723,962		$	0.10
Granted		-			-
Canceled or expired		-			-
Outstanding - May 31, 2019		14,723,962		$	0.10
Exercisable at May 31, 2019		14,723,962		$	0.10

Note 8. Stock Options

The Company ~~following~~has ~~table~~one ~~summarizes~~stock ~~information~~option ~~about~~plan called The 2006 Employee Stock and Option Plan (the “2006 Plan”), which has reserved 5,000,000 shares of our common stock for issuance. The types of awards that could be granted under the 2006 Plan include incentive and non-qualified options ~~outstanding~~to aspurchase shares of ~~May~~common 31stock, ~~2019:~~stock appreciation rights, restricted shares, restricted share units, performance awards and other types of stock-based awards. All grants are determined and approved by the Board of Directors. Through February 28, 2018, the Company has only granted non-qualified stock options under the 2006 Plan. The stock options may be granted to officers and employees of the Company. Options granted under the 2006 Plan have exercise prices and vesting terms approved by the Board of Directors at the time of each grant. Vesting terms of the outstanding options range from immediate to four years from the date of grant. The exercise period of the options range from five to ten years from the date of grant.

Exercise Price	Number Outstanding	Weighted Average Remaining Life (years)	Weighted Average Exercise Price	Number Exercisable	Weighted Average Exercisable Price
$0.05	5,968,750	4.42	$0.05	5,968,750	$0.05
$0.10	7,405,212	4.71	$0.10	7,405,212	$0.10
$0.15	200,000	6.52	$0.15	200,000	$0.15
$0.30	700,000	6.17	$0.30	700,000	$0.30
$0.54	375,000	4.68	$0.54	375,000	$0.54
$1.00	75,000	2.36	$1.00	75,000	$1.00
$0.10 - $1.00	14,723,962	4.67	$0.10	14,723,962	$0.10

The Company records its stock-based compensation arrangements calculating the fair value of share-based payments, including grants of employee stock options and employee stock purchase plan shares, to be recognized in the consolidated statements of operations based on their grant date fair values. The fair value of the Company’s stock options have been estimated using the Black-Scholes pricing model, which requires assumptions as to expected dividends, the options expected life, volatility and risk-free interest rate at the time of the grant. The value of the portion of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite vesting periods in the Company’s consolidated statements of operations.

15The Company ~~Table~~did not issue any stock options during the first six months of ~~Contents~~fiscal 2020. In the second quarter of fiscal 2020, 555,212 stock options expired.

~~Note~~On October 91, 2018, the Company issued 2,468,750 stock options with a fair value of $188,740 to three contractors to purchase shares of the Company’s common stock at a price of $0.05. ~~Related~~These ~~Party~~options ~~Transactions~~vest immediately and are exercisable for five years.

~~Accounts~~On November ~~Payable~~21, –2018, ~~Related~~the ~~Parties~~Company issued 3,500,000 stock options with a fair value of $120,421 to three contractors to purchase shares of the Company’s common stock at a price of $0.05. These options vest immediately and are exercisable for five years.

AsOn June 1, 2018, the Company issued 3,555,212 stock options with a fair value of ~~May~~$436,131 31to one employee to purchase shares of the Company’s common stock at a price of $0.10. 3,000,000 options vest immediately and are exercisable for five years. 555,212 options vest over 12 months, and are exercisable for five years. In the third quarter of fiscal 2019, the Company ~~owes~~expensed an additional $4319,~~000~~621 related to ~~Sam~~the ~~Ciacco~~proportioned ~~related~~vesting toof ~~accounting~~the ~~and~~555,212 ~~consulting~~options. ~~services~~The ~~provided~~Company ~~during~~terminated ~~the~~this ~~period~~employee’s contract on November 30, 2018, toresulting ~~April~~in 30only 276,845 ~~2019~~of the 555,212 options vesting. The balance of 278,367 options have been forfeited.

AsThe Company ofutilized ~~May 31, 2019,~~ the ~~Company~~following ~~owes~~key ~~$95,000~~assumptions toin ~~Jeffrey~~computing ~~Mills~~the ~~related~~fair tovalue ~~consulting~~of ~~services~~the ~~provided~~options ~~during~~using the ~~period~~Black-Scholes ~~December~~pricing ~~1, 2018 to April 30, 2019.~~model:

As of May 31, 2019, the Company owes $35,000 to Darvin Habben related to consulting services provided during the period December 1, 2018 to April 30, 2019.

	June 1 2018			June 1 2018			October 1 2018			November 21 2018
Weighted-average volatility		223	%		223	%		208	%		192	%
Expected dividends		None			None			None			None
Expected term (in years)		2.50			3.00			3.00			3.00
Weighted-average risk-free interest rate		2.61	%		2.61	%		2.96	%		2.89	%

AsThe Company ofrecorded ~~May~~stock-based ~~31,~~compensation ~~2019,~~expense ~~the~~of ~~Company~~$0 ~~owes~~and $~~30,000~~0 tofor ~~James~~all ~~Parsons~~outstanding ~~related~~options tofor ~~consulting~~fiscal ~~services~~quarter ~~provided~~2020 ~~during~~and ~~the~~fiscal year ~~period December 1~~2019, ~~2018 to April 30, 2019~~respectively.

~~During the second quarter of 2019, Robert Monster deferred his salary payments to assist with cash conservation. As at May 31, 2019, $70,000 has been accrued as payable to Robert Monster.~~15

~~Convertible~~The following ~~Notes~~table ~~Payable~~summarizes –information ~~Related~~about ~~Party~~the Company’s stock options as of August 31, 2019:

On September 14, 2016, subject to a stock purchase agreement, the Company signed a secured convertible note of $400,000 with Clint Skidmore, founder of Rezserve Technology Ltd (“Rezserve”). The interest free note is due and payable within one year, at which time it can be converted into up to 1,000,000 shares of the Company’s common stock at a conversion price of $0.40 per share. The Company evaluated the note and determined that as the fixed exercise price exceeded the closing market price on the note issuance date, that no beneficial conversion feature was present.

	Number of Options			Weighted Average Exercise Price
Outstanding - February 28, 2018		6,235,159		$	0.16
Granted		9,523,962		$	0.07
Canceled or expired		(1,035,159	)	$	0.10
Outstanding - February 28, 2019		14,723,962		$	0.10
Granted		-			-
Canceled or expired		(555,212	)	$	0.10
Outstanding - August 31, 2019		14,168,750		$	0.10
Exercisable at August 31, 2019		14,168,750		$	0.10

On December 22, 2017, the Company formalized its agreement to extend and convert the original convertible note of $400,000 for Clint Skidmore to October 31, 2018, original founder of Rezserve Technologies Ltd. The following ~~Company~~table ~~has~~summarizes ~~repaid~~information ~~$80,000~~about ~~to Clint Skidmore, and converted $210,000 of the note to 1,100,000 shares of the Company’s common~~ stock, ~~resulting~~options inoutstanding aas ~~loss on conversion~~ of ~~$13,000.~~August ~~At February 28~~31, 2019~~, the Company owes $110,000 to Clint Skidmore, bearing no interest. This note had imputed interest expense of $11,500 in fiscal 2019 and $2,773 in the first quarter of fiscal 2020.~~:

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the fixed conversion price and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares.

Exercise Price		Number Outstanding		Weighted Average Remaining Life (years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercisable Price
$	0.05		5,968,750		4.17	$	0.05		5,968,750	$	0.05
$	0.10		6,850,000		4.17	$	0.10		6,850,000	$	0.10
$	0.15		200,000		6.27	$	0.15		200,000	$	0.15
$	0.30		700,000		5.92	$	0.30		700,000	$	0.30
$	0.54		375,000		4.43	$	0.54		375,000	$	0.54
$	1.00		75,000		2.11	$	1.00		75,000	$	1.00
$	0.10 - $1.00		14,168,750		4.61	$	0.10		14,168,750	$	0.10

~~On June~~ Note 9~~, 2017, the Company signed a convertible note of $500,000 with Darvin Habben, Chairman~~. ~~This~~Related ~~note~~Party is due and payable within one year, bears interest of 8%, and can be converted into up to 2,000,000 shares of the Company’s common stock at a conversion price of $0.25 per share. The Company recorded a debt discount equal to $300,000 due to this conversion feature. The note had accrued interest of $28,932 as of February 28, 2018. The debt discount had a balance at February 28, 2018 of $191,507. The Company recorded debt discount amortization expense of $108,493 during the year ended February 28, 2018. Transactions

OnAccounts Payable ~~May~~– 9,Related 2018, the Company converted the $500,000 convertible note with Darvin Habben, Chairman, along with accrued and unpaid interest of $38,027, to 5,380,274 shares of its common stock at a conversion price of $0.10 per share. The company recorded debt discount amortization expense of $191,507 during the quarter ended May 31, 2018, related to this debt’s conversion recorded at inception. Parties

OnAs of ~~July~~August 2031, ~~2017~~2019, the Company ~~signed~~owes ~~a promissory note of~~ $~~100~~94,~~000~~800 ~~with~~to ~~Derek~~Sam ~~Schumann,~~Ciacco ~~Director.~~related ~~This~~to ~~interest~~accounting ~~free note is due~~ and ~~payable~~executive ~~within~~management ~~one~~provided ~~year~~during ~~and~~the period ~~bears~~November ~~no interest. The Company issued~~ 1,~~000,000~~ ~~warrants~~2018 to ~~Derek~~August ~~Schumann in connection with this note~~31, ~~with an exercise price of $0~~2019.~~10, and expiry date of July 20, 2027. The Company recorded a warrant discount equal to $100,000 due to this warrant feature.~~

OnAs of ~~May~~August 931, ~~2018~~2019, the Company ~~converted~~owes ~~the~~ $~~100~~20,000 ~~promissory~~to ~~note~~Kevin ~~with~~Wilson ~~Derek~~related ~~Schumann, Director,~~ to ~~1,000,000~~executive ~~shares~~management ofprovided ~~its common stock at a conversion price of $0.10 per share. The company recorded debt discount amortization expense of $69,452~~ during the ~~quarter~~period ~~ended~~ May 311, 2019 ~~2018, related~~ to ~~this~~August ~~debt’s conversion recorded at inception. The note had imputed interest of $1,917 during the quarter ended May~~ 31, ~~2018~~2019.

OnAs of ~~July~~May 2031, ~~2017~~2019, the Company ~~signed~~owes ~~a promissory note of~~ $~~100~~95,000 ~~with~~to ~~Greg~~Jeffrey ~~Foss,~~Mills ~~Director.~~related ~~This~~to ~~interest~~consulting ~~free~~services ~~note~~provided isduring ~~due~~the ~~and~~period ~~payable within one year and bears no interest. The Company issued~~ December 1,~~000,000~~ ~~warrants~~2018 to ~~Greg~~April ~~Foss in connection with this note~~30, ~~with an exercise price of $0~~2019.~~10, and expiry date of July 20, 2027. The Company recorded a warrant discount equal to $100,000 due to this warrant feature.~~

16As of ~~Table~~May 31, 2019, the Company owes $35,000 to Darvin Habben related to consulting services provided during the period December 1, 2018 to April 30, 2019, plus an additional $20,929 in operating expenses paid by Darvin Habben on behalf of ~~Contents~~the Company.

OnAs of May 931, ~~2018~~2019, the Company ~~converted~~owes ~~the~~ $~~100~~30,000 ~~promissory~~to ~~note~~James ~~with~~Parsons ~~Greg~~related ~~Foss, Director,~~ to ~~1,000,000~~consulting ~~shares~~services ofprovided ~~its common stock at a conversion price of $0.10 per share. The company recorded debt discount amortization expense of $69,452~~ during the ~~quarter~~period ~~ended May 31~~December 1, 2018, ~~related~~ to ~~this~~April ~~debt’s conversion recorded at inception. The note had imputed interest of $1~~30,~~917~~ ~~during the quarter ended May 31, 2018~~2019.

~~On July 27, 2017,~~ During the ~~Company~~second ~~signed~~quarter ~~a promissory note~~ of ~~$150~~2019,~~000~~ ~~with~~Robert ~~Darvin~~Monster ~~Habben,~~deferred ~~CEO.~~his ~~This~~salary ~~interest~~payments ~~free~~to ~~note~~assist iswith ~~due~~cash ~~and payable within one year and bears no interest~~conservation. ~~The~~As ~~Company~~at ~~issued~~August 131,~~000,000~~ ~~warrants to Darvin Habben in connection with this note~~2019, ~~with an exercise price of~~ $~~0.10~~70,000 ~~and~~has ~~expiry~~been ~~date~~accrued ofas ~~July~~payable ~~27, 2027. The Company recorded a warrant discount equal~~ to ~~$150,000~~Robert ~~due to this warrant feature~~Monster.

OnConvertible Notes ~~May~~Payable 9,– ~~2018,~~Related the Company converted the $150,000 promissory note with Darvin Habben, Chairman, to 1,500,000 shares of its common stock at a conversion price of $0.10 per share. The company recorded debt discount amortization expense of $105,616 during the quarter ended May 31, 2018, related to this debt’s conversion recorded at inception. The note had imputed interest of $2,875 during the quarter ended May 31, 2018.Party

On September 1214, ~~2018~~2016, ~~the~~subject ~~Company~~to ~~issued~~ a ~~promissory~~stock ~~note~~purchase toagreement, ~~Epik~~the ~~Holdings~~Company ~~Inc.~~signed ~~for~~a secured convertible note of $~~765~~400,~~200~~000 ~~for~~with ~~conversion~~Clint Skidmore, founder of ~~accounts~~Rezserve ~~payable~~Technology -Ltd ~~related party~~(“Rezserve”). The ~~note~~interest ~~bears~~free ~~interest~~note atis ~~4%,~~due and ~~matures~~payable onwithin ~~September~~one 12year, at ~~2019.~~which ~~The~~time ~~note~~it ~~had~~can ~~accrued~~be ~~interest~~converted ofinto ~~$18~~up to 1,~~784~~000,000 ~~and~~shares of the Company’s common stock at a ~~principal~~conversion ~~balance~~price of $~~765,200~~0.40 per share. The Company evaluated the note and determined that as ofthe ~~May~~fixed 31exercise price exceeded the closing market price on the note issuance date, ~~2019~~that no beneficial conversion feature was present.

On November 15, 2018, the Company issued a promissory note to Robert Monster for $150,000 for conversion of outstanding severance owed. The note bears interest at 15%, and matures on November 15, 2019. The note had accrued interest of $12,144 and a principal balance of $150,000 as of May 31, 2019.16

~~Sales~~On December 22, 2017, the Company formalized its agreement to extend and convert the original convertible note of ~~Common~~$400,000 ~~Stock~~for Clint Skidmore to October 31, 2018, original founder of Rezserve Technologies Ltd. The Company has repaid $80,000 to Clint Skidmore, and converted $210,000 of the note to 1,100,000 shares of the Company’s common stock, resulting in a loss on conversion of $13,000. At February 28, 2019, the Company owes $110,000 to Clint Skidmore, bearing no interest. This note had imputed interest expense of $11,500 in fiscal 2019 and $2,773 in the first quarter of fiscal 2020.

~~During~~On August ~~the~~16, ~~first~~2019, ~~quarter~~the ofCompany ~~fiscal~~converted ~~2019~~the $110,000 ~~the~~convertible ~~Company~~note ~~sold~~with anClint ~~aggregate~~Skidmore ofto 24,~~950~~400,000 shares ~~to five~~ of the Company’s common ~~board~~stock ~~members~~ at ~~the~~a conversion price of $~~295~~0.025,~~000~~ fully extinguishing this note.

~~Employment~~On June ~~Agreements~~9, 2017, the Company signed a convertible note of $500,000 with Darvin Habben, Chairman. This note is due and payable within one year, bears interest of 8%, and can be converted into up to 2,000,000 shares of the Company’s common stock at a conversion price of $0.25 per share. The Company recorded a debt discount equal to $300,000 due to this conversion feature. The note had accrued interest of $28,932 as of February 28, 2018. The debt discount had a balance at February 28, 2018 of $191,507. The Company recorded debt discount amortization expense of $108,493 during the year ended February 28, 2018.

~~During~~On May ~~fiscal~~9, ~~2019~~2018, the Company ~~signed~~converted ~~employment~~the ~~agreements~~$500,000 convertible note with ~~two~~Darvin ~~member~~Habben, Chairman, along with accrued and unpaid interest of ~~senior~~$38,027, ~~management~~to 5,380,274 ~~neither~~shares of ~~which~~its ~~are~~common ~~still~~stock ~~active~~at a conversion price of $0.10 ~~All~~per ~~employment~~share. ~~agreements~~The ~~were~~company ~~for~~recorded adebt ~~period~~discount amortization expense of ~~approximately~~$191,507 12during the quarter ended May 31, 2018, related to 24this ~~months.~~debt’s conversion recorded at inception.

~~Directors~~Promissory Notes ~~and~~Payable ~~Officers~~- Related Party

InOn July ~~February~~20, ~~2019~~2017, ~~all~~the ~~non-executive~~Company ~~directors~~signed ~~received~~ a ~~stock~~promissory ~~grant~~note of 25$100,000 with Derek Schumann,~~000~~ ~~shares~~Director. This ~~resulted~~interest infree anote ~~stock-based~~is ~~compensation~~due and ~~expense~~payable ofwithin ~~$200,000~~one inyear ~~fiscal~~and ~~2019~~bears no interest. The ~~value~~Company ofissued ~~the~~1,000,000 ~~price~~warrants ~~per~~to ~~share~~Derek ~~was~~Schumann ~~determined~~in ~~based~~connection onwith this ~~the~~note, ~~closing~~with ~~market~~an exercise price onof ~~the~~$0.10, and expiry date of ~~grant~~July 20, 2027. The Company recorded a warrant discount equal to $100,000 due to this warrant feature.

InOn May ~~the~~9, ~~third~~2018, ~~quarter~~the ofCompany ~~fiscal~~converted ~~2019~~the $100,000 ~~three~~promissory ~~newly~~note ~~appointed~~with ~~Directors~~Derek ~~received~~Schumann, aDirector, ~~prorated~~to 1,000,000 shares of its common stock ~~grant~~at ~~based~~a onconversion ~~600,000~~price ~~annualized~~of ~~shares~~$0.10 ~~This~~per ~~resulted~~share. inThe acompany ~~stock-based~~recorded ~~compensation~~debt discount amortization expense of $6869,~~379~~452 induring ~~fiscal~~the quarter ~~2019~~ended May 31, 2018, related to this debt’s conversion recorded at inception. The note had imputed interest of $1,917 during the quarter ended May 31, 2018.

On July ~~June 1~~20, ~~2018~~2017, the Company ~~issued~~signed ~~3,555,212 stock options with~~ a ~~fair~~promissory ~~value~~note of $~~436~~100,~~131~~000 towith ~~one~~Greg ~~employee~~Foss, ~~whom~~Director. ~~was~~This ~~also~~interest afree ~~director,~~note tois ~~purchase~~due ~~shares~~and ofpayable within ~~the~~one ~~Company’s~~year ~~common~~and ~~stock~~bears atno ainterest. ~~price~~The ofCompany ~~$0.10.~~issued 31,000,000 ~~options~~warrants ~~vest~~to ~~immediately~~Greg ~~and~~Foss ~~are~~in ~~exercisable~~connection ~~for~~with ~~five~~this ~~years. 555~~note,~~212~~ ~~options~~with ~~vest~~an exercise ~~over~~price 12of ~~months~~$0.10, and ~~are~~expiry ~~exercisable~~date ~~for~~of ~~five~~July ~~years~~20, 2027. The Company ~~terminated~~recorded ~~this~~a ~~employee’s~~warrant ~~contract~~discount onequal ~~November~~to 30$100,000 ~~2018,~~due ~~resulting~~to inthis warrant ~~only 276,845 of the 555,212 options vesting~~feature. ~~The balance of 278,367 options have been forfeited.~~

~~CEO~~On May ~~Employment~~9, ~~Agreement~~2018, ~~Share~~the ~~Issuance~~Company converted the $100,000 promissory note with Greg Foss, Director, to 1,000,000 shares of its common stock at a conversion price of $0.10 per share. The company recorded debt discount amortization expense of $69,452 during the quarter ended May 31, 2018, related to this debt’s conversion recorded at inception. The note had imputed interest of $1,917 during the quarter ended May 31, 2018.

~~The~~On July ~~Company~~27, ~~expensed $221~~2017,~~392~~ inthe ~~stock-based~~Company ~~compensation~~signed ina ~~the~~promissory ~~first~~note ~~quarter~~ of ~~fiscal 2020~~$150,000 ~~and~~with ~~expensed~~Darvin ~~$160~~Habben,~~000~~ inCEO. ~~annual~~This ~~salary~~interest ~~and~~free ~~$476,534~~note inis ~~stock-based~~due ~~compensation~~and inpayable within ~~fiscal~~one ~~2019,~~year ~~related~~and tobears ~~the~~no ~~employment~~interest. ~~agreement~~The ~~with~~Company ~~Robert~~issued ~~Monster~~1,000,000 ~~the~~warrants ~~Company’s~~to ~~former~~Darvin ~~CEO.~~Habben ~~Robert~~in ~~Monster’s~~connection ~~employment~~ with ~~the~~this ~~Company~~note, ~~was~~with an ~~terminated~~exercise onprice ~~September~~of 13$0.10, ~~2018,~~ and ~~his~~expiry ~~stock-based~~date ~~compensation~~of ~~will~~July ~~continue vesting until May 31~~27, ~~2019~~2027. AsThe ofCompany ~~May~~recorded ~~31,~~a ~~2019,~~warrant ~~Robert~~discount ~~Monster’s~~equal ~~stock-based~~to ~~compensation~~$150,000 ~~has~~due ~~completely~~to this ~~vested~~warrant feature.

17On May ~~Table~~9, 2018, the Company converted the $150,000 promissory note with Darvin Habben, Chairman, to 1,500,000 shares of ~~Contents~~its common stock at a conversion price of $0.10 per share. The company recorded debt discount amortization expense of $105,616 during the quarter ended May 31, 2018, related to this debt’s conversion recorded at inception. The note had imputed interest of $2,875 during the quarter ended May 31, 2018.

~~The~~On September ~~Company~~12, ~~expensed $80~~2018,~~000~~ inthe ~~annual~~Company ~~salary~~issued ~~and~~a ~~$163,897~~promissory innote ~~stock~~to ~~option~~Epik ~~awards~~Holdings inInc. ~~fiscal~~for ~~2019~~$765,200 ~~related~~for toconversion ~~the~~of ~~employment~~accounts ~~agreement~~payable - ~~with~~related ~~George Nagy, CEO~~party. ~~George~~The ~~Nagy’s~~note ~~tenure~~bears ~~was~~interest ~~from~~at ~~September 13~~4%, ~~2018~~and tomatures ~~December~~on 20September 12, ~~2018~~2019.

~~CEO~~During the ~~Accrued~~second ~~Salary~~quarter ~~Conversion~~of fiscal 2020, the Company converted $743,858 of the September 12, 2018 note into 76,278,041 shares of the Company’s common stock, leaving a principal balance due of $21,342. The note had accrued interest of $11,069 as of August 31, 2019.

On February 16, 2018, Robert Monster, CEO converted $70,000 of his accrued salary into 700,000 shares of common stock and 700,000 stock options with an exercise price of $0.10 and a vesting period of 12 months. The shares and options were valued on the conversion date in the amounts of $161,000 and $92,507, respectively.17

~~Accrued~~On November ~~Expenses~~15, -2018, ~~Related~~the ~~Parties~~Company issued a promissory note to Robert Monster for $150,000 for conversion of outstanding severance owed. The note bears interest at 15%, and matures on November 15, 2019. The note had accrued interest of $17,815 and a principal balance of $150,000 as of August 31, 2019.

~~The Company was founded in 1982 and managed by Richard Pomije since at least 1987. On May 17, 2015, Mr. Pomije resigned as CEO~~ Sales of ~~the~~Common Company and on June 1, 2015, he resigned as the CFO and Chairman. At that time of his resignation, the Company and the Board of Directors were not aware of any continuing employment agreement. The Company released Mr. Pomije on September 11, 2015 concurrent with his closing of the Burnsville, MN office. Stock

OnDuring the ~~December~~first 5,quarter ~~2016,~~of ~~Richard~~fiscal ~~Pomije~~2019, ~~filed a lawsuit against~~ the Company. ~~Mr.~~sold ~~Pomije asserts~~ an ~~employment~~aggregate ~~agreement existed and a continuing obligation~~ of ~~the Company in the form of a monthly salary for a 1 year term from May 18~~2, ~~2015 to May 17~~950,000 ~~2016~~shares ~~was due in addition~~ to afive ~~stock~~of ~~subscription receivable. Mr. Pomije claims~~ the Company’s ~~owes~~board ~~him~~members at ~~$260,900, which had been fully accrued for by~~ the ~~Company~~price as of ~~February 28~~$295, ~~2017~~000.

On April 18, 2018, Mr. Richard Pomije was granted a judgement for the lawsuit he filed against the Company on December 5, 2016. Mr. Pomije was awarded $256,488 as damages, and $296,488 as attorney’s fees and costs, for a total award of $552,976. As at February 28, 2018, $552,976 has been accrued as payable to Mr. Pomije. During the quarter ending May 31, 2018, $10,910 was paid to Mr. Richard Pomije. As at May 31, 2019, $542,066 has been accrued as payable to Mr. Pomije.Employment Agreements

~~The~~During fiscal ~~Company~~2019, ~~filed~~the anCompany ~~appeal~~signed onemployment ~~June~~agreements ~~13,~~with ~~2018.~~two Onmembers ~~April~~of 1,senior ~~2019~~management, ~~the~~neither ~~Court~~ of ~~Appeals~~which ~~issued~~are ~~its~~still active. ~~Unpublished~~All ~~Opinion~~employment inagreements ~~favor~~were offor ~~the~~a ~~Company~~period ~~with~~of ~~respect~~approximately 12 to ~~its~~24 ~~appeal filed against Mr~~months. ~~Richard Pomije’s judgement on June 13, 2018.~~

On May 9, 2019, Mr. Pomije agreed to extend scheduling deadlines by 60 days to negotiate a settlement prior to trial, which is scheduled for January 2020. See Note 14 for additional information about transactions between the Company Directors and ~~its former officer.~~Officers

~~Note~~In February 102019, all non-executive directors received a stock grant of 25,000,000 shares. ~~Income~~This ~~Taxes~~resulted in a stock-based compensation expense of $200,000 in fiscal 2019. The value of the price per share was determined based on the closing market price on the date of grant.

~~The Company accounts for income taxes under standards issued by~~ In the ~~FASB.~~third ~~Under~~quarter ~~those~~of ~~standards~~fiscal 2019, ~~deferred~~three ~~tax~~newly ~~assets~~appointed ~~and~~Directors ~~liabilities~~received ~~are~~a ~~recognized~~prorated ~~for~~stock ~~future~~grant ~~tax~~based ~~benefits~~on or600,000 ~~consequences~~annualized shares. ~~attributable~~This toresulted ~~temporary~~in ~~differences~~a ~~between~~stock-based ~~the~~compensation ~~financial~~expense ~~statement carrying amounts~~ of ~~existing~~$68,379 ~~assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income~~ in ~~the~~fiscal ~~years in which those temporary differences are expected to be recovered or settled~~2019. ~~A valuation allowance is provided for significant deferred tax assets when it is more likely than not that such assets will not be realized through future operations.~~

NoOn June ~~provision~~1, ~~for~~2018, ~~federal~~the ~~income~~Company ~~taxes~~issued ~~has~~3,555,212 ~~been~~stock ~~recorded~~options ~~due~~with toa ~~the~~fair ~~net~~value ~~operating~~of ~~loss~~$436,131 ~~carry~~to ~~forwards~~one ~~totaling $20~~employee,~~476,048~~ aswhom ofwas ~~May~~also 31a director, to ~~2019~~purchase ~~that~~shares ~~will~~of ~~offset~~the ~~future~~Company’s ~~taxable~~common ~~income.~~stock ~~The~~at ~~available~~a ~~net~~price ~~operating~~of ~~loss~~$0.10. ~~carry~~3,000,000 ~~forwards~~options ~~will~~vest ~~expire~~immediately inand ~~various~~are ~~years~~exercisable for ~~through~~five ~~2039~~years. ~~Future~~555,212 ~~tax~~options ~~benefits~~vest ~~which~~over ~~may~~12 ~~arise~~months, asand aare ~~result~~exercisable offor ~~these~~five ~~losses~~years. ~~have~~The ~~not~~Company ~~been~~terminated ~~recognized~~this inemployee’s contract ~~these~~on ~~consolidated~~November ~~financial~~30, ~~statements~~2018, asresulting ~~their~~in ~~realization~~only is276,845 ~~determined~~of ~~not~~the ~~likely to occur and accordingly~~555,212 ~~the~~options ~~Company~~vesting. ~~has~~The ~~recorded~~balance aof ~~valuation~~278,367 ~~allowance~~options ~~for~~have ~~the future tax loss carry forwards~~been forfeited.

~~The~~CEO Employment ~~actual~~Agreement ~~income~~Share tax provisions differ from the expected amounts calculated by applying the statutory income tax rate to the Company’s loss before income taxes. The components of these differences are as follows at May 31, 2019 and February 28, 2019: Issuance

	May 31, 2019			February 28, 2019
Net tax loss carry-forwards	$	20,476,048		$	20,331,988
Statutory rate		21	%		21	%
Expected tax recovery		4,299,970			4,269,717
Change in valuation allowance		(4,299,970	)		(4,269,717	)
Income tax provision	$	-		$	-
Components of deferred tax asset:
Non capital tax loss carry forwards	$	4,299,970		$	4,269,717
Less: valuation allowance		(4,299,970	)		(4,269,717	)
Net deferred tax asset	$	-		$	-

The Company expensed $221,392 in stock-based compensation in the first quarter of fiscal 2020, and expensed $160,000 in annual salary and $476,534 in stock-based compensation in fiscal 2019, related to the employment agreement with Robert Monster, the Company’s former CEO. Robert Monster’s employment with the Company was terminated on September 13, 2018, and his stock-based compensation will continue vesting until May 31, 2019. As of May 31, 2019, Robert Monster’s stock-based compensation has completely vested.

18The Company ~~Table~~expensed of$80,000 ~~Contents~~in annual salary and $163,897 in stock option awards in fiscal 2019 related to the employment agreement with George Nagy, CEO. George Nagy’s tenure was from September 13, 2018 to December 20, 2018.

~~Note~~The Company ~~11.~~expensed ~~Commitments~~$60,000 ~~and~~in ~~Contingencies~~executive management expense in fiscal 2020 related to the consulting agreement with Sam Ciacco, CEO.

~~Litigation~~CEO Accrued Salary Conversion

~~The~~On February ~~Company~~16, in2018, ~~the~~Robert ~~normal~~Monster, ~~course~~CEO ofconverted ~~business~~$70,000 isof ahis ~~party~~accrued tosalary ~~various~~into ~~ordinary~~700,000 ~~course~~shares ~~claims~~of ~~and~~common ~~legal~~stock ~~proceedings.~~and In700,000 stock ~~the~~options ~~opinion~~with ofan ~~management,~~exercise ~~the~~price ~~ultimate resolution~~ of ~~these~~$0.10 ~~matters,~~and ~~individually~~a ~~and~~vesting inperiod ~~the~~of ~~aggregate,~~12 ~~will~~months. ~~not~~The ~~have~~shares aand ~~material~~options ~~adverse~~were ~~effect~~valued on the ~~Company’s~~conversion date ~~financial~~in ~~position~~the oramounts ~~results~~ of ~~operations.~~$161,000 and $92,507, respectively.

OnAccrued Expenses ~~December~~- 5,Related 2016, Richard Pomije filed a lawsuit against the Company. Mr. Pomije asserts an employment agreement existed and a continuing obligation of the Company in the form of a monthly salary for a 1 year term from May 18, 2015 to May 17, 2016 was due in addition to a stock subscription receivable. Mr. Pomije claims the Company owes him $260,900, which had been fully accrued for by the Company as of February 28, 2017. Parties

On December ~~April 18~~5, ~~2018~~2016, ~~Mr.~~ Richard Pomije ~~was~~filed ~~granted~~ a ~~judgement for the~~ lawsuit ~~he filed~~ against the Company ~~on December 5, 2016~~. Mr. Pomije ~~was~~asserts ~~awarded~~an ~~$256,488~~employment asagreement ~~damages,~~existed and ~~$296,488~~a continuing asobligation ~~attorney’s~~of ~~fees~~the ~~and~~Company ~~costs,~~in ~~for~~the aform ~~total award~~ of ~~$552,976.~~a Asmonthly atsalary ~~February~~for ~~28,~~a ~~2018,~~1 ~~$552,976~~year ~~has~~term ~~been~~from ~~accrued~~May as18, ~~payable~~2015 to ~~Mr.~~May ~~Pomije.~~17, ~~During~~2016 ~~the~~was ~~quarter~~due in ~~ending~~addition ~~May~~to ~~31,~~a ~~2018,~~stock ~~$10,910~~subscription ~~was~~receivable. ~~paid to~~ Mr. ~~Richard~~ Pomije. Asclaims atthe ~~May~~Company ~~31,~~owes ~~2019,~~him $~~542~~260,~~066~~900, ~~has~~which had been fully accrued for by the Company as ~~payable~~of toFebruary ~~Mr.~~28, ~~Pomije~~2017.

~~The~~On April ~~Company~~18, 2018, Mr. Richard Pomije was granted a judgement for the lawsuit he filed anagainst ~~appeal~~the Company on ~~June~~December 135, ~~2018~~2016. OnMr. Pomije ~~April~~was 1awarded $256,488 ~~2019~~as damages, ~~the~~and ~~Court~~$296,488 ofas ~~Appeals~~attorney’s ~~issued~~fees ~~its~~and ~~Unpublished~~costs, ~~Opinion~~for ina ~~favor~~total award of $552,976. During the ~~Company~~quarter ~~with~~ending ~~respect~~May to31, ~~its~~2018, ~~appeal~~$10,910 ~~filed~~was ~~against~~paid to Mr. Richard Pomije’s. ~~judgement~~As onat ~~June~~August 1331, ~~2018~~2019, $542,066 has been accrued as payable to Mr. Pomije.

~~Lease~~The Company ~~Commitments~~filed an appeal on June 13, 2018. On April 1, 2019, the Court of Appeals issued its Unpublished Opinion in favor of the Company with respect to its appeal filed against Mr. Richard Pomije’s judgement on June 13, 2018. See Note 14 for additional information about transactions between the Company and its former officer.

AsNote 10. ofIncome ~~May 31, 2019, there are no operating leases in place.~~Taxes

~~Note~~The Company 12accounts for income taxes under standards issued by the FASB. ~~Earnings~~Under ~~(Loss)~~those ~~Per~~standards, ~~Share~~deferred tax assets and liabilities are recognized for future tax benefits or consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for significant deferred tax assets when it is more likely than not that such assets will not be realized through future operations.

~~The~~No provision ~~Company~~for ~~computes~~federal ~~earnings~~income ~~per~~taxes ~~share~~has ~~using~~been ~~two~~recorded ~~different~~due ~~methods,~~to ~~basic~~the ~~and~~net ~~diluted,~~operating ~~and~~loss ~~presents~~carry ~~per~~forwards ~~share~~totaling ~~data~~$20,423,957 ~~for~~as ~~all~~of ~~periods~~August 31, in2019 ~~which~~that ~~statements~~will ofoffset ~~operations~~future ~~are~~taxable ~~presented~~income. ~~Basic~~The ~~earnings~~available ~~per~~net ~~share~~operating ~~are~~loss ~~computed~~carry byforwards ~~dividing~~will ~~net~~expire ~~income~~in ~~(loss)~~various byyears through ~~the~~2039. ~~weighted~~Future ~~average~~tax ~~number~~benefits ofwhich ~~shares~~may arise as a result of ~~common~~these ~~stock~~losses ~~outstanding.~~have ~~Diluted~~not ~~earnings~~been ~~per~~recognized ~~share~~in ~~are~~these ~~computed~~consolidated byfinancial statements, ~~dividing~~as ~~net~~their ~~income~~realization ~~(loss)~~is bydetermined ~~the~~not ~~weighted~~likely ~~average~~to ~~number~~occur ofand ~~shares~~accordingly, ofthe ~~common~~Company ~~stock~~has ~~and~~recorded ~~common~~a ~~stock~~valuation ~~equivalents~~allowance for ~~outstanding~~the future tax loss carry forwards.

~~Due~~The actual toincome ~~the~~tax ~~recent~~provisions ~~net~~differ ~~losses~~from ~~generated~~the expected amounts calculated by applying the ~~Company,~~statutory ~~there~~income ~~are~~tax norate ~~dilutive~~to ~~elements~~the Company’s loss before income taxes. ~~Therefore,~~The ~~basic~~components ~~and~~of ~~diluted~~these ~~EPS~~differences are ~~the~~as ~~same.~~follows at August 31, 2019 and February 28, 2019:

The following tables provide a reconciliation of the numerators and denominators used in calculating basic and diluted earnings (loss) per share for the first quarter of fiscal years 2020 and 2019:

	August 31, 2019			February 28, 2019
Net tax loss carry-forwards	$	20,546,349		$	20,331,988
Statutory rate		21	%		21	%
Expected tax recovery		4,314,733			4,269,717
Change in valuation allowance		(4,314,733	)		(4,269,717	)
Income tax provision	$			$	-

Components of deferred tax asset:
Non capital tax loss carry forwards	$	4,314,733		$	4,269,717
Less: valuation allowance		(4,314,733	)		(4,269,717	)
Net deferred tax asset	$	-		$	-

	Fiscal 2020			Fiscal 2019
Basic earnings (loss) per share calculation:
Net loss to common shareholders	$	(558,567	)	$	(2,256,142	)
Weighted average number of common shares outstanding		289,973,493			86,876,957
Basic net loss per share	$	(0.00	)	$	(0.03	)
Diluted earnings (loss) per share calculation:
Net loss to common shareholders	$	(558,567	)	$	(2,256,142	)
Weighted average number of common shares outstanding		289,973,493			86,876,957
Stock options (1)		-			-
Warrants (2)		-			-
Diluted weighted average common shares outstanding		289,973,493			86,876,957
Diluted net loss per share	$	(0.00	)	$	(0.03	)

Note 11. Commitments and Contingencies

~~__________~~ Litigation

(1)	At May 31, 2019 and May 31, 2018, there were 14,723,962 and 6,235,159, respectively, of stock options equivalent to common shares outstanding. The stock options are anti-dilutive at May 31, 2019 and May 31, 2018 and therefore, have been excluded from diluted earnings (loss) per share.
(2)	At May 31, 2019 and May 31, 2018, there were outstanding warrants equivalent to 6,080,000 and 9,044,740 common shares, respectively. The warrants are anti-dilutive at May 31, 2019 and May 31, 2018 and therefore, have been excluded from diluted earnings (loss) per share.

The Company, in the normal course of business, is a party to various ordinary course claims and legal proceedings. In the opinion of management, the ultimate resolution of these matters, individually and in the aggregate, will not have a material adverse effect on the Company’s financial position or results of operations.

~~19 Table~~On December 5, 2016, Richard Pomije filed a lawsuit against the Company. Mr. Pomije asserts an employment agreement existed and a continuing obligation of ~~Contents~~the Company in the form of a monthly salary for a 1 year term from May 18, 2015 to May 17, 2016 was due in addition to a stock subscription receivable. Mr. Pomije claims the Company owes him $260,900, which had been fully accrued for by the Company as of February 28, 2017.

~~Note~~On April 1318, 2018, Mr. ~~Debt~~Richard Pomije was granted a judgement for the lawsuit he filed against the Company on December 5, 2016. Mr. Pomije was awarded $256,488 as damages, and $296,488 as attorney’s fees and costs, for a total award of $552,976. During the quarter ending May 31, 2018, $10,910 was paid to Mr. Richard Pomije. As at August 31, 2019, $542,066 has been accrued as payable to Mr. Pomije.

~~Convertible~~The Company filed an appeal on June 13, 2018. On April 1, 2019, the Court of Appeals issued its Unpublished Opinion in favor of the Company with respect to its appeal filed against Mr. Richard Pomije’s judgement on June 13, 2018. See Note ~~Payable~~14 -for ~~Related~~additional information ~~Party~~about transactions between the Company and its former officer.

~~Clint Skidmore - Note~~ 19

~~On December 22, 2017, the Company formalized its agreement to extend and convert the original convertible note~~ As of ~~$400,000~~August ~~for Clint Skidmore to October~~ 31, 2018, original founder of Rezserve Technologies Ltd. The Company has repaid $80,000 to Clint Skidmore, and converted $210,000 of the note to 1,100,000 shares of the Company’s common stock, resulting in a loss on conversion of $13,000. At May 31, 2019, ~~the~~there ~~Company~~are ~~owes $110,000 to Clint Skidmore, bearing~~ no ~~interest.~~operating ~~This~~leases ~~note had imputed interest expense of $11,500~~ in ~~fiscal 2019, and $2,773 in the first quarter of fiscal 2020~~place.

~~The~~Note 12. ~~Company~~Earnings ~~evaluated~~(Loss) ~~the~~Per convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the fixed conversion price and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares. Share

~~Darvin~~The Company ~~Habben~~computes -earnings ~~Note~~per share using two different methods, basic and diluted, and presents per share data for all periods in which statements of operations are presented. Basic earnings per share are computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding. Diluted earnings per share are computed by dividing net income (loss) by the weighted average number of shares of common stock and common stock equivalents outstanding.

OnDue to ~~June 9, 2017,~~ the ~~Company~~recent ~~signed~~net alosses ~~convertible~~generated ~~note~~by ~~of $500,000 with Darvin Habben, Chairman. This note is due and payable within one year, bears interest of 8%, and can be converted into up to 2,000,000 shares of~~ the Company~~’s common stock at a conversion price of $0.25 per share. The Company recorded a debt discount equal to $300~~,~~000~~ ~~due~~there toare ~~this~~no ~~conversion~~dilutive ~~feature~~elements. ~~The note had accrued interest of $28~~Therefore,~~932~~ asbasic ofand ~~February~~diluted ~~28,~~EPS ~~2018.~~are ~~The debt discount had a balance at February 28, 2018 of $191,507. The Company recorded debt discount amortization expense of $108,493 during~~ the ~~year ended February 28, 2018~~same.

OnThe following ~~May~~tables 9,provide ~~2018,~~a ~~the~~reconciliation ~~Company~~of ~~converted~~ the ~~$500,000~~numerators ~~convertible~~and ~~note~~denominators ~~with~~used ~~Darvin~~in ~~Habben,~~calculating ~~Chairman,~~basic ~~along with accrued~~ and ~~unpaid~~diluted ~~interest~~earnings ~~of $38,027.40, to 5,380,274 shares of its common stock at a conversion price of $0.10~~ (loss) per share. ~~The~~for ~~company~~the ~~recorded~~first ~~debt~~six ~~discount~~months ~~amortization expense~~ of ~~$191,507~~fiscal ~~during~~years ~~the~~2020 ~~quarter~~and ~~ended May 31, 2018, related to this debt’s conversion recorded at inception.~~ 2019:

Promissory Note Payable - Related Party

	Fiscal 2020			Fiscal 2019
Basic earnings (loss) per share calculation:
Net loss to common shareholders	$	(948,809	)	$	(4,988,658	)
Weighted average number of common shares outstanding		778,308,162			106,720,550
Basic net loss per share	$	(0.00	)	$	(0.05	)

Diluted earnings (loss) per share calculation:
Net loss to common shareholders	$	(948,809	)	$	(4,988,658	)
Weighted average number of common shares outstanding		778,308,162			106,720,550
Stock options (1)		-			-
Warrants (2)		-			-
Diluted weighted average common shares outstanding		778,308,162			106,720,550
Diluted net loss per share	$	(0.00	)	$	(0.05	)

Derek Schumann - Note

(1)	At August 31, 2019 and August 31, 2018, there were 14,168,750 and 9,790,371, respectively, of stock options equivalent to common shares outstanding. The stock options are anti-dilutive at August 31, 2019 and August 31, 2018 and therefore, have been excluded from diluted earnings (loss) per share.

(2)	At August 31, 2019 and August 31, 2018, there were outstanding warrants equivalent to 6,080,000 and 9,044,740 common shares, respectively. The warrants are anti-dilutive at August 31, 2019 and August 31, 2018 and therefore, have been excluded from diluted earnings (loss) per share.

~~On July 20, 2017, the Company signed a promissory note of $100,000 with Derek Schumann, Director~~Note 13. This interest free note is due and payable within one year and bears no interest. The Company issued 1,000,000 warrants to Derek Schumann in connection with this note, with an exercise price of $0.10, and expiry date of July 20, 2027. The Company recorded a warrant discount equal to $100,000 due to this warrant feature. The note had imputed interest of $6,110 as of February 28, 2018. The warrant discount had a balance at February 28, 2018 of $69,452. The Company recorded warrant discount amortization expense of $30,548 during the year ended February 28, 2018. Debt

OnNotes Payable ~~May~~- 9,Related 2018, the Company converted the $100,000 promissory note with Derek Schumann, Director, to 1,000,000 shares of its common stock at a conversion price of $0.10 per share. The company recorded debt discount amortization expense of $69,452 during the quarter ended May 31, 2018, related to this debt’s conversion recorded at inception. The note had imputed interest of $1,917 during the quarter ended May 31, 2018. Party

~~Greg~~Clint Skidmore ~~Foss~~– - Note

On September ~~July~~14, 202016, ~~2017~~subject to a stock purchase agreement, the Company signed a ~~promissory~~secured convertible note of $~~100~~400,000 with ~~Greg Foss~~Clint Skidmore, ~~Director~~founder of Rezserve Technology Ltd (“Rezserve”). ~~This~~The interest free note is due and payable within one year, at ~~and~~which ~~bears~~time noit ~~interest.~~can ~~The~~be ~~Company~~converted ~~issued~~into up to 1,000,000 ~~warrants~~shares toof ~~Greg~~the ~~Foss~~Company’s incommon ~~connection~~stock ~~with~~at ~~this~~a ~~note,~~conversion ~~with an exercise~~ price of $0.~~10,~~40 per ~~and expiry date of July 20, 2027~~share. The Company ~~recorded~~evaluated athe ~~warrant discount equal to $100,000 due to this warrant feature. The~~ note ~~had~~and ~~imputed~~determined ~~interest~~that ~~of $6,110~~ as ofthe ~~February~~fixed ~~28,~~exercise ~~2018.~~price ~~The~~exceeded ~~warrant~~the ~~discount~~closing ~~had~~market aprice ~~balance~~on the atnote ~~February~~issuance 28date, ~~2018~~that ofno ~~$69,452.~~beneficial ~~The~~conversion ~~Company~~feature ~~recorded~~was ~~warrant discount amortization expense of $30,548 during the year ended February 28, 2018~~present.

20On December ~~Table~~22, 2017, the Company formalized its agreement to extend and convert the original convertible note of ~~Contents~~$400,000 for Clint Skidmore to October 31, 2018, original founder of Rezserve Technologies Ltd. The Company has repaid $80,000 to Clint Skidmore, and converted $210,000 of the note to 1,100,000 shares of the Company’s common stock, resulting in a loss on conversion of $13,000. At May 31, 2019, the Company owes $110,000 to Clint Skidmore, bearing no interest. This note had imputed interest expense of $11,500 in fiscal 2019, and $2,773 in the first quarter of fiscal 2020.

On August ~~May 9~~16, ~~2018~~2019, the Company converted the $~~100~~110,000 ~~promissory~~convertible note with ~~Greg~~Clint ~~Foss,~~Skidmore ~~Director,~~ to 14,~~000~~400,000 shares of ~~its~~the Company’s common stock at a conversion price of $0.~~10 per share. The company recorded debt discount amortization expense of $69~~025,~~452~~ ~~during~~fully ~~the~~extinguishing ~~quarter ended May 31, 2018, related to~~ this ~~debt’s conversion recorded at inception. The~~ note ~~had imputed interest of $1,917 during the quarter ended May 31, 2018~~.

~~Darvin Habben - Note~~ 20

OnEpik Holdings ~~July 27, 2017, the Company signed a promissory note of $150,000 with Darvin Habben, Chairman~~Inc. ~~This~~– interest free note is due and payable within one year and bears no interest. The Company issued 1,000,000 warrants to Darvin Habben in connection with this note, with an exercise price of $0.10, and expiry date of July 27, 2027. The Company recorded a warrant discount equal to $150,000 due to this warrant feature. The note had imputed interest of $8,877 as of February 28, 2018. The warrant discount had a balance at February 28, 2018 of $105,616. The Company recorded warrant discount amortization expense of $44,384 during the year ended February 28, 2018. Note

On September ~~May 9~~12, 2018, the Company ~~converted~~issued ~~the~~a promissory note to Epik Holdings Inc. for $~~150~~765,~~000~~200 ~~promissory~~for conversion of accounts payable - related party. The note ~~with~~bears ~~Carvin~~interest ~~Habben~~at 4%, ~~Chairman~~and matures on September 12, to2019. 1During the first six months of fiscal 2020,~~500~~ the Company converted $247,350 with Dot London Domains for 4,947,000 shares of ~~its~~the Company’s common stock aton abehalf ~~conversion price~~ of ~~$0.10~~Epik Holdings ~~per share~~Inc. ~~The~~Also ~~company~~during ~~recorded~~this ~~debt~~period, ~~discount~~the ~~amortization~~Company ~~expense~~converted of $~~105~~496,~~616~~508 ~~during~~with ~~the~~Minds ~~quarter~~and ~~ended~~Machines ~~May~~for 31$496,508 ~~2018,~~of ~~related~~stock topayable ~~this~~on behalf ~~debt’s~~of ~~conversion~~Epik ~~recorded~~Holdings ~~at inception~~Inc. The note had ~~imputed~~a ~~interest~~principal balance of $221,~~875~~342 ~~during~~as ~~the~~of ~~quarter~~August ~~ended May~~ 31, ~~2018~~2019.

~~Convertible~~Rob Monster ~~Note~~– ~~Payable - Third Party~~ Note

~~PowerUp~~On November ~~Lending~~15, -2018, ~~Note~~the 1Company issued a promissory note to Robert Monster for $150,000 for conversion of outstanding severance owed. The note bears interest at 15%, and matures on November 15, 2019. The note had accrued interest of $17,815 and a principal balance of $150,000 as of August 31, 2019.

OnDarvin Habben ~~October~~– 30, 2017, the Company issued a convertible note to PowerUp Lending Group Ltd. for $75,000 of cash consideration. The note bears interest at 12%, matures on October 30, 2018, and is convertible after 180 days into common stock at 61% of the lowest 3 closing market prices of the previous 10 trading days prior to conversion. The Company recorded a debt discount equal to $47,951 due to this conversion feature. Note

On June ~~May 3~~9, ~~2018~~2017, ~~PowerUp~~the ~~Lending~~Company ~~Group~~signed ~~Ltd.~~a ~~converted~~convertible note of $12500,000 ofwith ~~the~~Darvin ~~principal~~Habben, ~~amount~~Chairman. ofThis ~~the~~note ~~October~~is 30due and payable within one year, ~~2017~~bears ~~note~~interest of 8%, and can be converted into ~~170~~up to 2,~~940~~000,000 shares of the Company’s common stock, ~~leaving~~at a ~~principal~~conversion price ~~balance~~of $0.25 per share. The Company recorded a debt discount equal to $300,000 due to this conversion feature. The note had accrued interest of $6328,~~000~~932 as of February 28, 2018. The debt discount had a balance at February 28, 2018 of $191,507. The Company recorded debt discount amortization expense of $108,493 during the year ended February 28, 2018.

On May 79, 2018, ~~PowerUp~~the ~~Lending~~Company ~~Group Ltd.~~ converted the $13500,000 ofconvertible ~~the~~note ~~principal~~with ~~amount~~Darvin ofHabben, ~~the~~Chairman, ~~October~~along ~~30,~~with ~~2017~~accrued ~~note~~and ~~into~~unpaid ~~213~~interest of $38,~~115~~027.40, to 5,380,274 shares of ~~the~~its ~~Company’s~~ common stock, ~~leaving~~at a ~~principal~~conversion ~~balance~~price ~~due~~of $0.10 per share. The company recorded debt discount amortization expense of $50191,~~000.~~507 during the quarter ended May 31, 2018, related to this debt’s conversion recorded at inception.

OnPromissory Note ~~May~~Payable ~~10,~~- ~~2018,~~Related ~~PowerUp Lending Group Ltd. converted $15,000 of the principal amount of the October 30, 2017 note into 245,902 shares of the Company’s common stock, leaving a principal balance due of $35,000.~~ Party

OnDerek Schumann ~~May~~– 15, 2018, PowerUp Lending Group Ltd. converted $20,000 of the principal amount of the October 30, 2017 note into 327,869 shares of the Company’s common stock, leaving a principal balance due of $15,000. Note

On July ~~May~~20, 162017, ~~2018~~the Company signed a promissory note of $100,000 ~~PowerUp~~with ~~Lending~~Derek ~~Group~~Schumann, ~~Ltd~~Director. ~~converted~~This ~~$15~~interest free note is due and payable within one year and bears no interest. The Company issued 1,000,000 warrants to Derek Schumann in connection with this note, with an exercise price of ~~the~~$0.10, ~~principal~~and ~~amount~~expiry date of July 20, ~~plus~~2027. The Company recorded a warrant discount equal to $4100,~~500~~000 indue ~~accrued~~to ~~and~~this ~~unpaid~~warrant feature. The note had imputed interest, of ~~the~~$6,110 ~~October~~as 30of February 28, ~~2017~~2018. ~~note~~The ~~into~~warrant ~~319~~discount had a balance at February 28,~~672~~ ~~shares~~2018 of ~~the~~$69,452. The Company’s ~~common~~recorded ~~stock~~warrant discount amortization expense of $30,548 ~~fully~~during ~~extinguishing~~the ~~this~~year ended ~~note.~~February 28, 2018.

~~The~~On May 9, 2018, the Company converted the $100,000 promissory note with Derek Schumann, Director, to 1,000,000 shares of its common stock at a conversion price of $0.10 per share. The company recorded debt discount amortization ~~expenses~~expense of $3269,~~055~~452 during the quarter ended May 31, 2018, related to this debt’s conversion recorded at inception. The note had imputed interest of $1,917 during the ~~first~~ quarter ofended ~~fiscal~~May ~~2019.~~31, 2018.

~~PowerUp~~Greg Foss ~~Lending~~– - Note 2

On July ~~November 30~~20, 2017, the Company ~~issued~~signed a ~~convertible~~promissory note toof ~~PowerUp Lending Group Ltd. for~~ $58100,000 ofwith ~~cash~~Greg ~~consideration~~Foss, Director. ~~The~~This ~~note bears~~ interest atfree ~~12%,~~note ~~matures~~is ondue ~~November~~and ~~30,~~payable within ~~2018,~~one year and isbears ~~convertible~~no ~~into~~interest. ~~common~~The ~~stock~~Company atissued ~~61%~~1,000,000 ofwarrants ~~the~~to ~~lowest~~Greg 3Foss ~~closing~~in ~~market~~connection ~~prices~~with ofthis ~~the~~note, ~~previous~~with 10an exercise ~~trading~~price ~~days~~of ~~prior to conversion~~$0.10, ~~with~~and aexpiry ~~fixed~~date ~~price~~of ~~floor~~July of20, $02027.~~00009.~~ The Company recorded a ~~debt~~warrant discount equal to $28100,~~754~~000 due to this warrant ~~conversion~~ feature. The note had ~~accrued~~imputed interest of $36,~~456~~110 as of ~~May~~February 3128, 2018. The ~~debt~~warrant discount had a balance at ~~May 31~~February 28, 2018 of $1969,~~213~~452. The Company recorded ~~debt~~warrant discount amortization expense of $930,~~541~~548 during the ~~quarter~~year ended ~~May~~February 3128, 2018.

On May ~~June 14~~9, 2018, ~~PowerUp~~the ~~Lending~~Company ~~Group Ltd.~~ converted the $20100,000 promissory note with Greg Foss, Director, to 1,000,000 shares of ~~the~~its ~~principal~~common ~~amount~~stock at a conversion price of ~~the~~$0.10 ~~November~~per ~~30,~~share. ~~2017~~The ~~note~~company ~~into~~recorded ~~309,119~~debt ~~shares~~discount amortization expense of $69,452 during the ~~Company~~quarter ended May 31, 2018, related to this debt’s ~~common~~conversion ~~stock,~~recorded ~~leaving~~at ainception. ~~principal~~The ~~balance~~note ~~due~~had imputed interest of $381,~~000.~~917 during the quarter ended May 31, 2018.

OnDarvin Habben ~~June~~– 20, 2018, PowerUp Lending Group Ltd. converted $15,000 of the principal amount of the November 30, 2017 note into 196,592 shares of the Company’s common stock, leaving a principal balance due of $23,000. Note

21On July ~~Table~~27, 2017, the Company signed a promissory note of ~~Contents~~$150,000 with Darvin Habben, Chairman. This interest free note is due and payable within one year and bears no interest. The Company issued 1,000,000 warrants to Darvin Habben in connection with this note, with an exercise price of $0.10, and expiry date of July 27, 2027. The Company recorded a warrant discount equal to $150,000 due to this warrant feature. The note had imputed interest of $8,877 as of February 28, 2018. The warrant discount had a balance at February 28, 2018 of $105,616. The Company recorded warrant discount amortization expense of $44,384 during the year ended February 28, 2018.

On June 29, 2018, PowerUp Lending Group Ltd. converted $15,000 of the principal amount of the November 30, 2017 note into 257,290 shares of the Company’s common stock, leaving a principal balance due of $8,000. 21

On May ~~July 20~~9, 2018, ~~PowerUp~~the ~~Lending~~Company ~~Group Ltd.~~ converted the $8150,000 ofpromissory ~~the~~note ~~principal~~with ~~amount~~Carvin Habben, ~~plus~~Chairman, $3to 1,~~480~~500,000 inshares ~~accrued~~of ~~and~~its ~~unpaid~~common stock ~~interest,~~at a conversion price of ~~the~~$0.10 ~~November~~per ~~30,~~share. ~~2017~~The ~~note~~company ~~into~~recorded ~~376,393~~debt ~~shares~~discount amortization expense of $105,616 during the quarter ~~Company’s~~ended ~~common~~May ~~stock~~31, ~~fully~~2018, ~~extinguishing~~related to this ~~note~~debt’s conversion recorded at inception. The note had imputed interest of $2,875 during the quarter ended May 31, 2018.

~~During~~Convertible Note ~~the~~Payable ~~second~~- ~~quarter~~Third ~~of fiscal 2019, the Company recorded debt discount amortization expenses of $19,213, representing the debt discount balance, due to the extinguishment of this note.~~ Party

PowerUp Lending - Note 3 1

On October ~~January 18~~30, ~~2018~~2017, the Company issued a convertible note to PowerUp Lending Group Ltd. for $5375,000 of cash consideration. The note bears interest at 12%, matures on ~~January~~October 1830, ~~2019~~2018, and is convertible after 180 days into common stock at 61% of the lowest 3 closing market prices of the previous 10 trading days prior to conversion~~, with a fixed price floor of $0~~.~~00009.~~ The Company recorded a debt discount equal to $3347,~~164~~ 951 due to this conversion feature. The note had accrued interest of $2,304 as of May 31, 2018. The debt discount had a balance at May 31, 2018 of $21,608. The Company recorded debt discount amortization expense of $8,471 during the quarter ended May 31, 2018.

On May ~~July 11~~3, 2018, ~~the Company paid $78,323 to~~ PowerUp Lending Group Ltd., ~~representing~~converted $5312,000 ~~for~~of the principal amount of the ~~January~~October 1830, ~~2018~~2017 note, ~~$3,099~~into ~~in accrued and unpaid interest~~170,940 ~~and $22,224 in losses on settlement~~ shares of ~~debt.~~the ~~The~~ Company’s ~~recorded~~common ~~debt discount amortization expense of $21~~stock,~~608,~~ ~~representing~~leaving ~~the~~a ~~debt~~principal ~~discount~~ balance, due ~~to the extinguishment~~ of ~~this note~~$63,000.

On May 7, 2018, PowerUp Lending -Group ~~Note~~Ltd. 4converted $13,000 of the principal amount of the October 30, 2017 note into 213,115 shares of the Company’s common stock, leaving a principal balance due of $50,000.

On May ~~September 17~~10, 2018, ~~the Company issued a convertible note to~~ PowerUp Lending Group Ltd. ~~for~~converted $8515,000 of ~~cash~~the ~~consideration.~~principal ~~The~~amount ~~note~~of ~~bears~~the ~~interest~~October ~~at 12%~~30, ~~matures~~2017 onnote ~~September~~into 17245,902 ~~2019, and is convertible into common stock at 61%~~ shares of the ~~lowest~~Company’s 3common ~~closing market prices of the previous 10 trading days prior to conversion~~stock, ~~with~~leaving a ~~fixed~~principal ~~price~~balance ~~floor~~due of $~~0.00009. The Company recorded a debt discount equal to $85~~35,000 ~~due to this conversion feature~~. ~~The Company recorded debt discount amortization expense of $38,192 during fiscal 2019, and $46,808 during the first quarter of fiscal 2020.~~

On May ~~March 21~~15, ~~2019~~2018, ~~Power~~PowerUp Up Lending Group Ltd. converted $1820,~~130~~000 of the principal amount of the ~~September~~October 1730, ~~2018~~2017 note into 7327,~~554,167~~869 shares of the Company’s common stock, leaving a principal balance due of $6615,~~870~~000.

On May ~~March 25~~16, ~~2019~~2018, ~~Power~~PowerUp Up Lending Group Ltd. converted $1315,~~600~~000 of the principal amount, plus $4,500 in accrued and unpaid interest, of the ~~September~~October 1730, ~~2018~~2017 note into 7319,~~555,556~~672 shares of the Company’s common stock, ~~leaving~~fully aextinguishing ~~principal~~this ~~balance due of $53,270~~note.

OnThe Company ~~March~~recorded ~~27,~~debt ~~2019,~~discount ~~Power~~amortization Upexpenses ~~Lending~~of ~~Group Ltd. converted~~ $1332,~~595~~055 ofrelated ~~the~~to ~~principal~~this ~~amount of the September 17, 2018~~ note ~~into~~during ~~7,552,778 shares of~~ the ~~Company’s~~first ~~common~~quarter ~~stock, leaving a principal balance due~~ of ~~$39,675.~~fiscal 2019.

~~On March 29, 2019, Power Up~~ PowerUp Lending ~~Group~~- ~~Ltd.~~Note ~~converted $16,620 of the principal amount of the September 17, 2018 note into 9,233,333 shares of the Company’s common stock, leaving a principal balance due of $23,055.~~ 2

On November ~~April 1~~30, ~~2019~~2017, ~~Power~~the UpCompany issued a convertible note to PowerUp Lending Group Ltd. ~~converted~~for $1458,~~770~~000 of ~~the~~cash ~~principal~~consideration. ~~amount~~The note ofbears ~~the~~interest ~~September~~at 1712%, ~~2018~~matures ~~note~~on ~~into~~November 930,~~231~~ 2018,~~250~~ ~~shares~~and ofis ~~the~~convertible ~~Company’s~~into common stock at 61% of the lowest 3 closing market prices of the previous 10 trading days prior to conversion, ~~leaving~~with a ~~principal~~fixed ~~balance~~price floor of $0.00009. The Company recorded a debt discount equal to $28,754 due to this conversion feature. The note had accrued interest of $83,~~285~~456 as of May 31, 2018. The debt discount had a balance at May 31, 2018 of $19,213. The Company recorded debt discount amortization expense of $9,541 during the quarter ended May 31, 2018.

On June ~~April 4~~14, ~~2019~~2018, ~~Power~~PowerUp Up Lending Group Ltd. converted $820,~~285~~000 of the principal amount, ~~plus $5,100 in accrued and unpaid interest,~~ of the ~~September~~November 1730, ~~2018~~2017 note into 9309,~~560,714~~ 119 shares of the Company’s common stock, ~~fully~~leaving ~~extinguishing~~a ~~this~~principal ~~note.~~balance due of $38,000.

On June 20, 2018, PowerUp Lending -Group ~~Note~~Ltd. 5converted $15,000 of the principal amount of the November 30, 2017 note into 196,592 shares of the Company’s common stock, leaving a principal balance due of $23,000.

On June ~~October 23~~29, 2018, ~~the Company issued a convertible note to~~ PowerUp Lending Group Ltd. ~~for~~converted $5315,000 of ~~cash~~the ~~consideration.~~principal ~~The~~amount ~~note~~of ~~bears~~the ~~interest~~November ~~at 12%~~30, ~~matures~~2017 onnote ~~October~~into 23257,290 shares ~~2019, and is convertible into common stock at 61%~~ of the ~~lowest~~Company’s 3common ~~closing market prices of the previous 10 trading days prior to conversion~~stock, ~~with~~leaving a ~~fixed~~principal ~~price~~balance ~~floor of $0.00009. The Company recorded a debt discount equal to $49,926~~ due ~~to this conversion feature. The Company recorded debt discount amortization expense~~ of $208,~~583 during fiscal 2019, and $32,417 during the first quarter of fiscal 2020~~000.

On July ~~April 26~~20, ~~2019~~2018, ~~Power~~PowerUp Up Lending Group Ltd. converted $128,~~900~~000 of the principal amount, plus $3,480 in accrued and unpaid interest, of the ~~October~~November 2330, ~~2018~~2017 note into 11376,~~727,273~~393 shares of the Company’s common stock, ~~leaving~~fully aextinguishing ~~principal~~this ~~balance due of $40,100~~note.

OnDuring the ~~April~~second ~~30,~~quarter ~~2019,~~of ~~Power~~fiscal ~~Up Lending Group Ltd. converted $11~~2019,~~500~~ of the ~~principal~~Company ~~amount~~recorded ofdebt ~~the~~discount ~~October~~amortization ~~23,~~expenses ~~2018~~of ~~note into 11~~$19,~~734~~213,~~694~~ ~~shares~~representing of the ~~Company’s~~debt discount ~~common stock~~balance, ~~leaving~~due ato ~~principal~~the ~~balance~~extinguishment ~~due~~ of ~~$28,600.~~this note.

22 ~~Table of Contents~~

~~On May 2, 2019, Power Up~~ PowerUp Lending ~~Group~~- ~~Ltd.~~Note ~~converted $10,000 of the principal amount of the October 23, 2018 note into 11,764,706 shares of the Company’s common stock, leaving a principal balance due of $18,600.~~ 3

On January ~~May 3~~18, ~~2019~~2018, ~~Power~~the UpCompany issued a convertible note to PowerUp Lending Group Ltd. ~~converted~~for $853,~~600~~000 of ~~the~~cash ~~principal~~consideration. ~~amount~~The ofnote bears ~~the~~interest ~~October~~at 2312%, ~~2018~~matures ~~note~~on ~~into~~January 1118,~~780~~ 2019,~~822~~ ~~shares~~and ofis ~~the~~convertible ~~Company’s~~into common stock at 61% of the lowest 3 closing market prices of the previous 10 trading days prior to conversion, ~~leaving~~with a ~~principal~~fixed ~~balance~~price floor of $0.00009. The Company recorded a debt discount equal to $33,164 due to this conversion feature. The note had accrued interest of $102,~~000~~304 as of May 31, 2018. The debt discount had a balance at May 31, 2018 of $21,608. The Company recorded debt discount amortization expense of $8,471 during the quarter ended May 31, 2018.

On July ~~May~~11, 62018, ~~2019~~the Company paid $78,323 ~~Power~~to UpPowerUp Lending Group Ltd., ~~converted~~representing $853,~~600~~000 offor the principal ~~amount~~ of the ~~October~~January 2318, 2018 note, ~~into~~$3,099 11in accrued and unpaid interest,~~780~~ and $22,~~822~~224 ~~shares~~in losses on settlement of ~~the~~debt. The Company’s ~~common~~recorded ~~stock~~debt discount amortization expense of $21,608, ~~leaving~~representing athe ~~principal~~debt discount balance, due to the extinguishment of ~~$1,400.~~this note.

~~On May 8, 2019, Power Up~~ PowerUp Lending ~~Group~~- ~~Ltd.~~Note ~~converted $1,400 of the principal amount, plus $3,180 in accrued and unpaid interest, of the October 23, 2018 note into 6,273,973 shares of the Company’s common stock, fully extinguishing this note.~~ 4

On September 17, 2018, the Company issued a convertible note to PowerUp Lending -Group ~~Note~~Ltd. 6for $85,000 of cash consideration. The note bears interest at 12%, matures on September 17, 2019, and is convertible into common stock at 61% of the lowest 3 closing market prices of the previous 10 trading days prior to conversion, with a fixed price floor of $0.00009. The Company recorded a debt discount equal to $85,000 due to this conversion feature. The Company recorded debt discount amortization expense of $38,192 during fiscal 2019, and $46,808 during the first quarter of fiscal 2020.

On March ~~January 22~~21, 2019, ~~the~~Power ~~Company~~Up ~~issued a convertible note to PowerUp~~ Lending Group Ltd. ~~for~~converted $1218,~~500~~130 of ~~cash consideration. The note bears interest at 12%, matures on January 22, 2020, and is convertible after 180 days into common stock at 50% of~~ the ~~lowest~~principal ~~closing~~amount ~~market prices~~ of the ~~previous~~September ~~20 trading days prior to conversion~~17, ~~with~~2018 ~~a fixed price floor of $0.00009. The Company recorded a debt discount equal to $12,500 due to this conversion feature. The~~ note ~~had~~into ~~accrued interest of $942 as of May 31~~7, ~~2019. The debt discount had a balance at May 31~~554,167 shares ~~2019~~ of ~~$8,082.~~the ~~The~~ Company’s ~~recorded~~common ~~debt discount amortization expense of $1~~stock,~~267~~ ~~during~~leaving ~~the~~a ~~quarter~~principal ~~ended~~balance ~~February~~due ~~28,~~of ~~2019, and~~ $366,~~151 during the quarter ended May 31, 2019~~870.

~~The~~On March ~~Company~~25, ~~evaluated~~2019, ~~the~~Power ~~convertible~~Up ~~note~~Lending ~~and~~Group ~~determined~~Ltd. ~~that~~converted ~~the~~$13,600 ~~shares~~of ~~issuable pursuant to~~ the ~~conversion~~principal ~~option~~amount ~~were~~of ~~determinate due to~~ the ~~fixed~~September ~~conversion~~17, ~~price~~2018 ~~and,~~note asinto ~~such~~7,555,556 shares ~~does~~of ~~not~~the ~~constitute~~Company’s acommon ~~derivative~~stock, ~~liability~~leaving asa ~~the~~principal ~~Company~~balance ~~has~~due ~~sufficient~~of ~~authorized shares~~$53,270.

~~PowerUp~~On March 27, 2019, Power Up Lending -Group ~~Note~~Ltd. converted $13,595 of the principal amount of the September 17, 2018 note into 7,552,778 shares of the Company’s common stock, leaving a principal balance due of $39,675.

On March ~~May 9~~29, 2019, ~~the~~Power ~~Company~~Up ~~issued a convertible note to PowerUp~~ Lending Group Ltd. ~~for~~converted $4516,~~000~~620 of ~~cash~~the ~~consideration.~~principal ~~The~~amount ~~note~~of ~~bears~~the ~~interest~~September ~~at 12%~~17, ~~matures~~2018 onnote ~~May~~into 9, ~~2020~~233,333 shares ~~and is convertible after 180 days into common stock at 55%~~ of the ~~lowest~~Company’s ~~closing~~common ~~market prices of the previous 20 trading days prior to conversion~~stock, ~~with~~leaving a ~~fixed~~principal ~~price~~balance ~~floor of $0.00006. The Company recorded a debt discount equal to $45,000~~ due ~~to this conversion feature. The note had accrued interest~~ of $~~325 as of May 31~~23, ~~2019~~055. ~~The debt discount had a balance at May 31, 2019 of $42,288. The Company recorded debt discount amortization expense of $2,712 during the quarter ended May 31, 2019.~~

~~The~~On April ~~Company~~1, ~~evaluated~~2019, ~~the~~Power ~~convertible~~Up ~~note~~Lending ~~and~~Group ~~determined~~Ltd. ~~that~~converted ~~the~~$14,770 ~~shares~~of ~~issuable pursuant to~~ the ~~conversion~~principal ~~option~~amount ~~were~~of ~~determinate due to~~ the ~~fixed~~September ~~conversion~~17, ~~price~~2018 ~~and,~~note asinto ~~such~~9,231,250 shares ~~does~~of ~~not~~the ~~constitute~~Company’s acommon ~~derivative~~stock, ~~liability~~leaving asa ~~the~~principal ~~Company~~balance ~~has~~due ~~sufficient~~of ~~authorized shares~~$8,285.

~~Crown~~On April ~~Bridge~~4, -2019, ~~Note~~Power 1Up Lending Group Ltd. converted $8,285 of the principal amount, plus $5,100 in accrued and unpaid interest, of the September 17, 2018 note into 9,560,714 shares of the Company’s common stock, fully extinguishing this note.

OnPowerUp Lending ~~January~~- ~~30,~~Note 2018, the Company issued a convertible note to Crown Bridge Partners, LLC. for $55,000 of cash consideration. The note bears interest at 10%, matures on January 30, 2019, and is convertible into common stock at 61% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion, with a fixed floor price of $0.0001. The Company recorded a debt discount equal to $33,246 due to this conversion feature. The Company also recorded a $3,000 debt discount due to issuance fees. The note had accrued interest of $1,812 as of May 31, 2018. The debt discount had a balance at May 31, 2018 of $24,305. The Company recorded debt discount amortization expense of $9,062 during the quarter ended May 31, 2018. 5

On October ~~July 25~~23, 2018, the Company ~~paid~~issued ~~$83,312~~a convertible note to ~~Crown~~PowerUp ~~Bridge~~Lending ~~Partners,~~Group ~~LLC~~Ltd., ~~representing~~for $5553,000 ~~for~~of ~~the~~cash ~~principal~~consideration. ofThe ~~the~~note bears ~~January~~interest 30at 12%, ~~2018~~matures ~~note~~on October 23, $22019,~~499~~ inand ~~accrued~~is ~~and~~convertible ~~unpaid~~into ~~interest,~~common ~~and~~stock ~~$25~~at 61% of the lowest 3 closing market prices of the previous 10 trading days prior to conversion,~~813~~ inwith ~~losses~~a onfixed ~~settlement~~price floor of $0.00009. The Company recorded a debt discount equal to $49,926 due to this conversion feature. The Company recorded debt discount amortization expense of $2420,~~305,~~583 ~~representing~~during fiscal ~~the~~2019, ~~debt~~and ~~discount balance~~$32,417 ~~due~~during to the ~~extinguishment~~first quarter of ~~this~~fiscal ~~note~~2020.

~~Crown~~On April ~~Bridge~~26, -2019, ~~Note~~Power 2Up Lending Group Ltd. converted $12,900 of the principal amount of the October 23, 2018 note into 11,727,273 shares of the Company’s common stock, leaving a principal balance due of $40,100.

On April ~~September 27~~30, ~~2018~~2019, ~~the~~Power ~~Company~~Up ~~issued~~Lending aGroup ~~convertible note to Crown Bridge Partners, LLC~~Ltd. ~~for~~converted $5511,~~000~~500 of ~~cash~~the ~~consideration.~~principal ~~The~~amount ~~note~~of ~~bears~~the ~~interest~~October ~~at 10%~~23, ~~matures~~2018 onnote ~~September~~into 2911, ~~2019~~734,694 shares ~~and is convertible into common stock at 61%~~ of the ~~lowest 3 closing market prices of the previous 20 trading days prior to conversion, with a fixed floor price of $0.0001. The~~ Company’s ~~recorded~~common ~~a debt discount equal to $52~~stock,~~000~~ ~~due~~leaving ~~to this conversion feature. The Company also recorded~~ a ~~$3,000~~principal ~~debt~~balance ~~discount~~ due ~~to issuance fees. The note had accrued interest~~ of $~~2,321 as of February~~ 28, ~~2019~~600. ~~The debt discount had a balance at February 28, 2019 of $31,795. The Company recorded debt discount amortization expense of $23,205 during fiscal 2019.~~

On May ~~April 4~~2, 2019, ~~Crown~~Power ~~Bridge~~Up ~~Partners,~~Lending ~~LLC~~Group Ltd. converted $910,~~022~~000 of the principal amount of the ~~September~~October 2723, 2018 note into 911,~~200~~764,~~000~~ 706 shares of the Company’s common stock, leaving a principal balance due of $4518,~~978~~600.

On May 3, 2019, Power Up Lending Group Ltd. converted $8,600 of the principal amount of the October 23, ~~Table~~2018 note into 11,780,822 shares of ~~Contents~~the Company’s common stock, leaving a principal balance due of $10,000.

On May ~~April 12~~6, 2019, ~~Crown~~Power ~~Bridge~~Up ~~Partners,~~Lending ~~LLC~~Group Ltd. converted $108,~~111~~600 of the principal amount of the ~~September~~October 2723, 2018 note into 11,~~790~~780,~~000~~ 822 shares of the Company’s common stock, leaving a principal balance due of $351,~~867~~400.

On May ~~April 23~~8, 2019, ~~Crown~~Power ~~Bridge~~Up ~~Partners,~~Lending ~~LLC~~Group Ltd. converted $101,~~956~~400 of the principal amount, plus $3,180 in accrued and unpaid interest, of the ~~September~~October 2723, 2018 note into 126,~~380~~273,~~000~~973 shares of the Company’s common stock, ~~leaving~~fully aextinguishing ~~principal~~this ~~balance due of $25,411~~note.

On May 3, 2019, Crown Bridge Partners, LLC converted $7,852 of the principal amount of the September 27, 2018 note into 13,580,000 shares of the Company’s common stock, leaving a principal balance due of $17,930. 23

OnPowerUp Lending ~~May~~- 9,Note ~~2019, Crown Bridge Partners, LLC converted $~~6~~,745 of the principal amount of the September 27, 2018 note into 17,250,000 shares of the Company’s common stock, leaving a principal balance due of $11,185.~~

On January ~~May 16~~22, 2019, ~~Crown~~the ~~Bridge~~Company ~~Partners,~~issued ~~LLC~~a ~~converted~~convertible note to PowerUp Lending Group Ltd. for $812,~~509~~500 of ~~the~~cash ~~principal~~consideration. ~~amount~~The ofnote bears ~~the~~interest ~~September~~at 2712%, ~~2018~~matures ~~note~~on ~~into~~January 2122,~~450~~ 2020,~~000~~ ~~shares~~and ofis ~~the~~convertible ~~Company’s~~after 180 days into common stock at 50% of the lowest closing market prices of the previous 20 trading days prior to conversion, ~~leaving~~with a ~~principal~~fixed ~~balance~~price floor of $0.00009. The Company recorded a debt discount equal to $12,500 due to this conversion feature. The note had accrued interest of $3942 as of August 31,~~177~~ 2019. The debt discount had a balance at August 31, 2019 of $4,932. The Company recorded debt discount amortization expense of $1,267 during the quarter ended February 28, 2019, and $6,301 during the first two quarters ended August 31, 2019.

On August ~~May 21~~22, 2019, ~~Crown~~Power ~~Bridge~~Up ~~Partners,~~Lending ~~LLC~~Group Ltd. converted $3,~~177~~500 of the principal amount ~~and $3,407~~ of ~~accrued and unpaid interest of~~ the ~~September~~January 2722, ~~2018~~2019 note into 2570,~~300,~~000 ,00 shares of the Company’s common stock, leaving a principal balance due of $09, ~~not including default penalties and interest~~000.

On August ~~May 21~~26, 2019, ~~Crown~~Power ~~Bridge~~Up ~~Partners,~~Lending ~~LLC~~Group ~~imposed~~Ltd. converted $322,~~343~~500 inof ~~additional~~the ~~default~~principal ~~penalties~~amount asof ~~allowed~~the ~~under~~January ~~their~~22, 2019 note into 50,000,00 shares ~~increasing~~of the Company’s common stock, leaving a principal balance todue of $326,~~343~~500.

On August ~~May 22~~29, 2019, ~~Crown~~Power ~~Bridge~~Up ~~Partners,~~Lending ~~LLC~~Group Ltd. converted $73,~~550~~500 of the principal ~~default~~ amount of the ~~September~~January 2722, ~~2018~~2019 note into 3070,000,~~000~~ 00 shares of the Company’s common stock, leaving a principal ~~default~~ balance due of $243,~~793~~000.

OnThe Company ~~May~~evaluated ~~28,~~the ~~2019,~~convertible ~~Crown~~note ~~Bridge~~and ~~Partners,~~determined ~~LLC~~that ~~converted $7,108 of~~ the ~~principal~~shares ~~default~~issuable ~~amount~~pursuant ofto the ~~September~~conversion ~~27,~~option ~~2018~~were ~~note~~determinate due ~~into~~to ~~34,320,000~~the ~~shares~~fixed ofconversion ~~the~~price ~~Company’s~~and, ~~common~~as ~~stock~~such, ~~leaving~~does not constitute a ~~principal~~derivative ~~default~~liability ~~balance~~as ~~due~~the ofCompany ~~$17,685.~~has sufficient authorized shares.

~~The~~PowerUp Lending ~~Company~~- ~~evaluated~~Note the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the fixed conversion price and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares. 7

~~FirstFire~~On May ~~Global~~9, ~~Opportunities~~2019, -the ~~Note~~Company issued a convertible note to PowerUp Lending Group Ltd. for $45,000 of cash consideration. The note bears interest at 12%, matures on May 9, 2020, and is convertible after 180 days into common stock at 55% of the lowest closing market prices of the previous 20 trading days prior to conversion, with a fixed price floor of $0.00006. The Company recorded a debt discount equal to $45,000 due to this conversion feature. The note had accrued interest of $1,687 as of August 31, 2019. The debt discount had a balance at August 31, 2019 of $30,945. The Company recorded debt discount amortization expense of $14,055 during the first two quarters of fiscal 2020.

OnThe Company ~~July~~evaluated ~~10, 2018,~~ the ~~Company issued a~~ convertible note and ~~90,000~~determined ~~shares~~that ~~of its common stock to FirstFire Global Opportunities Fund LLC for $183,750 of cash consideration. The note bears interest at 10%, matures on July 10, 2019, and is convertible into common stock at~~ the ~~lower~~shares ofissuable ~~$0.20~~pursuant ~~per share or 75% of the lowest closing market prices of the previous 10 trading days prior~~ to ~~conversion. The Company recorded a debt discount equal to $143,325 due to a ratchet triggering event also on July 10, 2018, which lowered~~ the conversion ~~price~~option towere ~~$0.05 per share. The Company recorded a $8,750 debt discount representing the original issue discount. The Company also recorded a $8,010 debt discount~~ determinate due to the ~~90,000~~fixed shares issued. On January 23, 2019, the convertible note was amended to increase the principal by $5,000 for $5,000 of cash consideration. The Company recorded a further debt discount of $5,000 related to the conversion ~~feature~~price ~~of the January 23~~and, ~~2019 amendment. The note had accrued interest of $14,248~~ as ~~of May 31~~such, ~~2019.~~does ~~The~~not ~~debt~~constitute ~~discount had~~ a ~~balance~~derivative atliability ~~May~~as ~~31,~~the ~~2019 of $18,092. The~~ Company ~~recorded~~has ~~debt~~sufficient ~~discount amortization expense of $105,383 during fiscal 2019, and $41,610 during the first quarter of fiscal 2020~~authorized shares.

OnCrown Bridge ~~January~~- ~~11,~~Note ~~2019, FirstFire Global Opportunities Fund LLC converted $10,000 of the principal amount of the July 10, 2018 note into~~ 1~~,086,065 shares of the Company’s common stock, leaving a principal balance due of $173,750.~~

On January ~~February 7~~30, ~~2019~~2018, ~~FirstFire~~the ~~Global~~Company ~~Opportunities~~issued ~~Fund~~a convertible note to Crown Bridge Partners, LLC. ~~converted~~for $1055,000 of ~~the~~cash ~~principal~~consideration. ~~amount~~The note ofbears ~~the~~interest ~~July~~at 10%, ~~2018~~matures ~~note~~on ~~into~~January 130,~~930~~ 2019,~~783~~ ~~shares~~and is convertible into common stock at 61% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion, with a fixed floor price of $0.0001. The Company’s ~~common~~recorded ~~stock~~a debt discount equal to $33,246 ~~leaving~~due to this conversion feature. The Company also recorded a ~~principal~~$3,000 ~~balance~~debt discount due to issuance fees. The note had accrued interest of $~~163~~1,~~750~~812 as of May 31, 2018. The debt discount had a balance at May 31, 2018 of $24,305. The Company recorded debt discount amortization expense of $9,062 during the quarter ended May 31, 2018.

On July ~~February~~25, 212018, ~~2019~~the Company paid $83,312 ~~FirstFire~~to ~~Global~~Crown ~~Opportunities~~Bridge ~~Fund~~Partners, LLC., ~~converted~~representing $1055,~~565~~000 offor the principal ~~amount~~ of the ~~July 10~~January 30, 2018 note, ~~into~~$2,499 3in accrued and unpaid interest,~~500~~ and $25,~~000~~813 ~~shares~~in losses on settlement of ~~the~~debt. The Company’s ~~common~~recorded ~~stock~~debt discount amortization expense of $24,305, ~~leaving~~representing athe ~~principal~~debt discount balance, due to the extinguishment of ~~$153,185.~~this note.

OnCrown Bridge ~~March~~- 6,Note 2019, FirstFire Global Opportunities Fund LLC converted $10,431 of the principal amount of the July 10, 2018 note into 4,700,000 shares of the Company’s common stock, leaving a principal balance due of $142,754. 2

On September ~~March 18~~27, ~~2019~~2018, ~~FirstFire~~the ~~Global~~Company ~~Opportunities~~issued ~~Fund~~a convertible note to Crown Bridge Partners, LLC. ~~converted~~for $55,000 of cash consideration. The note bears interest at 10%,~~230~~ matures on September 29, 2019, and is convertible into common stock at 61% of the ~~principal~~lowest ~~amount~~3 closing market prices of the ~~July~~previous 1020 trading days prior to conversion, ~~2018~~with ~~note~~a ~~into~~fixed 5floor price of $0.0001. The Company recorded a debt discount equal to $52,000 due to this conversion feature. The Company also recorded a $3,000 ~~shares~~debt discount due to issuance fees. The note had accrued interest of ~~the~~$0 ~~Company’s~~as ~~common~~of ~~stock~~August 31, ~~leaving~~2019. aThe ~~principal~~debt discount had a balance ~~due~~at August 31, 2019 of $~~132~~4,~~524~~068. The Company recorded debt discount amortization expense of $27,726 during the first two quarters of fiscal 2020.

24On April ~~Table~~4, 2019, Crown Bridge Partners, LLC converted $9,022 of ~~Contents~~the principal amount of the September 27, 2018 note into 9,200,000 shares of the Company’s common stock, leaving a principal balance due of $45,978.

On April ~~March 25~~12, 2019, ~~FirstFire~~Crown ~~Global~~Bridge ~~Opportunities~~Partners, ~~Fund~~ LLC converted $1110,~~328~~111 of the principal amount of the ~~July~~September 1027, 2018 note into 611,~~000~~790,000 shares of the Company’s common stock, leaving a principal balance due of $~~121~~35,~~196~~867.

On March 29, 2019, FirstFire Global Opportunities Fund LLC converted $11,938 of the principal amount of the July 10, 2018 note into 8,000,000 shares of the Company’s common stock, leaving a principal balance due of $109,258. 24

On April 823, 2019, ~~FirstFire~~Crown ~~Global~~Bridge ~~Opportunities~~Partners, ~~Fund~~ LLC converted $610,~~600~~956 of the principal amount of the ~~July~~September 1027, 2018 note into 612,~~000~~380,000 shares of the Company’s common stock, leaving a principal balance due of $~~102~~25,~~658~~411.

On May 93, 2019, ~~FirstFire~~Crown ~~Global~~Bridge ~~Opportunities~~Partners, ~~Fund~~ LLC converted $67,~~204~~852 of the principal amount of the ~~July~~September 1027, 2018 note into 913,~~500~~580,000 shares of the Company’s common stock, leaving a principal balance due of $9617,~~084~~930.

On May 149, 2019, ~~FirstFire~~Crown ~~Global~~Bridge ~~Opportunities~~Partners, ~~Fund~~ LLC converted $76,~~313~~745 of the principal amount of the ~~July~~September 1027, 2018 note into 1017,~~900~~250,000 shares of the Company’s common stock, leaving a principal balance due of $8811,~~770~~185.

On May 16, 2019, ~~FirstFire~~Crown ~~Global~~Bridge ~~Opportunities~~Partners, ~~Fund~~ LLC converted $68,~~812~~509 of the principal amount of the ~~July~~September 1027, 2018 note into 1221,~~400~~450,000 shares of the Company’s common stock, leaving a principal balance due of $813,~~958~~177.

On May 2021, 2019, ~~FirstFire~~Crown ~~Global~~Bridge ~~Opportunities~~Partners, ~~Fund~~ LLC converted $43,~~920~~177 of the principal amount and $3,407 of accrued and unpaid interest of the ~~July~~September 1027, 2018 note into 1425,~~100~~300,000 shares of the Company’s common stock, leaving a principal balance due of $770,~~038.~~ not including default penalties and interest.

On May 21, 2019, ~~FirstFire~~Crown ~~Global~~Bridge ~~Opportunities~~Partners, ~~Fund~~ LLC ~~converted~~imposed $932,~~276~~343 ofin ~~the~~additional ~~principal~~default ~~amount~~penalties ofas ~~the~~allowed ~~July~~under ~~10,~~their ~~2018~~ note ~~into 24~~,~~300,000~~ ~~shares of~~ increasing the ~~Company’s common stock, leaving a~~ principal balance ~~due~~to of $6732,~~762~~343.

On May 2322, 2019, ~~FirstFire~~Crown ~~Global~~Bridge ~~Opportunities~~Partners, ~~Fund~~ LLC converted $127,~~478~~550 of the principal default amount of the ~~July~~September 1027, 2018 note into 31 30,~~200~~000,000 shares of the Company’s common stock, leaving a principal default balance due of $5524,~~284~~793.

On May 2428, 2019, ~~FirstFire~~Crown ~~Global~~Bridge ~~Opportunities~~Partners, ~~Fund~~ LLC converted $117,~~353~~108 of the principal default amount of the ~~July~~September 1027, 2018 note into 34,~~300~~320,000 shares of the Company’s common stock, leaving a principal default balance due of $4317,~~931~~685.

OnThe Company ~~May~~evaluated ~~28,~~the ~~2019,~~convertible ~~FirstFire~~note ~~Global~~and ~~Opportunities~~determined ~~Fund~~that ~~LLC~~the ~~converted~~shares ~~$7,584~~issuable ofpursuant to the ~~principal~~conversion ~~amount~~option ofwere ~~the~~determinate due ~~July~~to ~~10,~~the ~~2018~~fixed ~~note~~conversion ~~into~~price 36and,~~000,000~~ ~~shares~~as ofsuch, ~~the~~does ~~Company’s~~not ~~common~~constitute ~~stock,~~a ~~leaving~~derivative aliability ~~principal~~as ~~balance~~the ~~due~~Company ofhas ~~$36,347.~~sufficient authorized shares.

~~The~~FirstFire Global ~~Company~~Opportunities ~~evaluated~~- ~~the~~Note convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the fixed conversion price and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares. 1

~~EMA~~On July ~~Financial~~10, -2018, ~~Note~~the 1Company issued a convertible note and 90,000 shares of its common stock to FirstFire Global Opportunities Fund LLC for $183,750 of cash consideration. The note bears interest at 10%, matures on July 10, 2019, and is convertible into common stock at the lower of $0.20 per share or 75% of the lowest closing market prices of the previous 10 trading days prior to conversion. The Company recorded a debt discount equal to $143,325 due to a ratchet triggering event also on July 10, 2018, which lowered the conversion price to $0.05 per share. The Company recorded a $8,750 debt discount representing the original issue discount. The Company also recorded a $8,010 debt discount due to the 90,000 shares issued. On January 23, 2019, the convertible note was amended to increase the principal by $5,000 for $5,000 of cash consideration. The Company recorded a further debt discount of $5,000 related to the conversion feature of the January 23, 2019 amendment. On August 6, 2019, the convertible note was amended to increase the principal by $25,000 for $25,000 of cash consideration. The Company recorded a further debt discount of $2,000 related to the conversion feature of the August 6, 2019 amendment. The note had accrued interest of $16,436 as of August 31, 2019. The debt discount had a balance at August 31, 2019 of $0. The Company recorded debt discount amortization expense of $105,383 during fiscal 2019, and $85,415 during the first two quarters of fiscal 2020.

On January ~~October 22~~11, ~~2018~~2019, ~~the~~FirstFire ~~Company~~Global ~~issued~~Opportunities aFund ~~convertible note to EMA Financial,~~ LLC ~~for~~converted $5310,000 of ~~cash~~the ~~consideration.~~principal ~~The~~amount ~~note~~of ~~bears~~the ~~interest~~July at 10%, ~~matures~~2018 onnote into ~~October 22~~1, ~~2019~~086,065 ~~and~~shares ~~is convertible into common stock at 61%~~ of the ~~lowest~~Company’s 3common ~~closing market prices of the previous 15 trading days prior to conversion~~stock, ~~with~~leaving a ~~fixed~~principal ~~floor~~balance ~~price of $0.0001. The Company recorded a debt discount equal to $53,000~~ due ~~to this conversion feature. The note had accrued interest~~ of $2173,~~862 as of May 31, 2019~~750. ~~The debt discount had a balance at May 31, 2019 of $20,910. The Company recorded debt discount amortization expense of $18,732 during fiscal 2019, and $13,359 during the first quarter of fiscal 2020.~~

On February ~~May 3~~7, 2019, ~~EMA~~FirstFire ~~Financial~~Global Opportunities Fund LLC converted $510,~~105~~000 of the principal amount of the ~~October~~July 2510, 2018 note into 131,~~000~~930,~~000~~783 shares of the Company’s common stock, leaving a principal balance due of $73163,~~968, including additional $25,000 default amounts~~750.

On February ~~May 9~~21, 2019, ~~EMA~~FirstFire ~~Financial~~Global Opportunities Fund LLC converted $810,~~832~~565 of the principal amount of the ~~October~~July 2510, 2018 note into 163,~~000~~500,000 shares of the Company’s common stock, leaving a principal balance due of $65153,~~994~~185.

On March ~~May 14~~6, 2019, ~~EMA~~FirstFire ~~Financial~~Global Opportunities Fund LLC converted $910,~~259~~431 of the principal amount of the ~~October~~July 2510, 2018 note into 20 4,~~000~~700,000 shares of the Company’s common stock, leaving a principal balance due of $56142,~~734~~754.

On March ~~May 21~~18, 2019, ~~EMA~~FirstFire ~~Financial~~Global Opportunities Fund LLC converted $610,~~223~~230 of the principal amount of the ~~October~~July 2510, 2018 note into 22 5,000,000 shares of the Company’s common stock, leaving a principal balance due of $50132,~~511~~524.

25 ~~Table of Contents~~

~~The~~On March ~~Company~~25, ~~evaluated~~2019, ~~the~~FirstFire ~~convertible~~Global ~~note~~Opportunities ~~and~~Fund ~~determined~~LLC ~~that~~converted ~~the~~$11,328 ~~shares~~of ~~issuable pursuant to~~ the ~~conversion~~principal ~~option~~amount ~~were~~of ~~determinate due to~~ the ~~fixed~~July ~~conversion price and~~10, as2018 ~~such~~note into 6,000,000 ~~does~~shares ~~not~~of ~~constitute~~the aCompany’s ~~derivative~~common ~~liability~~stock, asleaving ~~the~~a ~~Company~~principal ~~has~~balance ~~sufficient~~due ~~authorized~~of ~~shares~~$121,196.

~~JSJ~~On March ~~Investments~~29, -2019, ~~Note~~FirstFire 1Global Opportunities Fund LLC converted $11,938 of the principal amount of the July 10, 2018 note into 8,000,000 shares of the Company’s common stock, leaving a principal balance due of $109,258.

On April ~~October 22~~8, ~~2018~~2019, ~~the~~FirstFire ~~Company~~Global ~~issued~~Opportunities aFund ~~convertible~~LLC ~~note~~converted ~~to JSJ Investments Inc. for~~ $596,~~500~~600 of ~~cash consideration. The note bears interest at 12%, matures on October 22, 2019, and is convertible into common stock at 61% of~~ the ~~lowest~~principal 3amount ~~closing market prices~~ of the ~~previous~~July ~~20 trading days prior to conversion~~10, ~~with~~2018 anote ~~fixed floor price of $0.0001. The Company recorded a debt discount equal to $57~~into 6,000 ~~due to this conversion feature. The Company also recorded a $2~~,~~500~~000 ~~debt~~shares ~~discount due to issuance fees. The note had accrued interest~~ of ~~$3,850~~the asCompany’s ofcommon ~~May 31~~stock, ~~2019.~~leaving ~~The debt discount had~~ a principal balance atdue ~~May 31, 2019~~ of $23102,~~474~~658. ~~The Company recorded debt discount amortization expense of $21,029 during fiscal 2019, and $14,997 during the first quarter of fiscal 2020.~~

On May 69, 2019, ~~JSJ~~FirstFire ~~Investments~~Global ~~Inc.~~Opportunities Fund LLC converted $86,~~137~~204 of the principal amount of the ~~October~~July 2210, 2018 note into 159,~~067~~500,~~787~~ 000 shares of the Company’s common stock, leaving a principal balance due of $5196,~~363~~084.

On May 1614, 2019, ~~JSJ~~FirstFire ~~Investments~~Global ~~Inc.~~Opportunities Fund LLC converted $87,~~741~~313 of the principal amount of the ~~October~~July 2210, 2018 note into 20 10,~~087~~900,~~963~~000 shares of the Company’s common stock, leaving a principal balance due of $4288,~~622~~770.

On May 2116, 2019, ~~JSJ~~FirstFire ~~Investments~~Global ~~Inc.~~Opportunities Fund LLC converted $76,~~637~~812 of the principal amount of the ~~October~~July 2210, 2018 note into 24 12,~~245~~400,~~023~~000 shares of the Company’s common stock, leaving a principal balance due of $3481,~~985~~958.

On May 2820, 2019, ~~JSJ~~FirstFire ~~Investments~~Global ~~Inc.~~Opportunities Fund LLC converted $64,~~736~~920 of the principal amount of the ~~October~~July 2210, 2018 note into 35 14,~~389~~100,~~771~~000 shares of the Company’s common stock, leaving a principal balance due of $2877,~~249~~038.

~~The~~On May ~~Company~~21, ~~evaluated~~2019, ~~the~~FirstFire ~~convertible~~Global ~~note~~Opportunities ~~and~~Fund ~~determined~~LLC ~~that~~converted ~~the~~$9,276 ~~shares~~of ~~issuable pursuant to~~ the ~~conversion~~principal ~~option~~amount ~~were~~of ~~determinate due to~~ the ~~fixed~~July ~~conversion price and~~10, as2018 ~~such~~note into 24,300,000 ~~does~~shares ~~not~~of ~~constitute~~the aCompany’s ~~derivative~~common ~~liability~~stock, asleaving ~~the~~a ~~Company~~principal ~~has~~balance ~~sufficient~~due ~~authorized~~of ~~shares~~$67,762.

~~Auctus~~On May 23, 2019, FirstFire Global Opportunities Fund -LLC ~~Note~~converted 1$12,478 of the principal amount of the July 10, 2018 note into 31,200,000 shares of the Company’s common stock, leaving a principal balance due of $55,284.

On May ~~November 14~~24, ~~2018~~2019, ~~the~~FirstFire ~~Company~~Global ~~issued~~Opportunities ~~a convertible note to Auctus~~ Fund, LLC ~~for~~converted $8511,~~000~~353 of ~~cash~~the ~~consideration.~~principal ~~The~~amount ~~note~~of ~~bears~~the ~~interest~~July ~~at 12%~~10, ~~matures~~2018 onnote ~~November 14~~into 34, ~~2019~~300,000 ~~and~~shares ~~is convertible into common stock at 61%~~ of the ~~lowest trading price of the previous 25 trading days prior to conversion, with a fixed floor price of $0.0001. The~~ Company’s ~~recorded~~common ~~a debt discount equal to $77~~stock,~~750~~ ~~due~~leaving ~~to this conversion feature. The Company also recorded~~ a ~~$7,250~~principal ~~debt~~balance ~~discount~~ due ~~to issuance fees. The note had accrued interest~~ of $~~0 as of May 31~~43, ~~2019~~931. ~~The debt discount had a balance at May 31, 2019 of $38,890. The Company recorded debt discount amortization expense of $24,685 during fiscal 2019, and $21,425 during the first quarter of fiscal 2020.~~

On May 1728, 2019, ~~Auctus~~FirstFire Global Opportunities Fund, LLC converted $27,~~334~~584 of the principal amount ~~and $5,086~~ of ~~accrued and unpaid interest of~~ the ~~November~~July 1410, 2018 note into 21 36,~~998~~000,~~800~~000 shares of the Company’s common stock, leaving a principal balance due of $8236,~~666~~347.

On June ~~May 28~~13, 2019, ~~Auctus~~FirstFire Global Opportunities Fund, LLC converted $79,~~440~~780 of the principal amount ~~and $299~~ of ~~accrued and unpaid interest of~~ the ~~November~~July 1410, 2018 note into 34 45,~~328~~000,~~200~~000 shares of the Company’s common stock, leaving a principal balance due of $7526,~~227~~567.

~~The~~On June ~~Company~~17, ~~evaluated~~2019, ~~the~~FirstFire ~~convertible~~Global ~~note~~Opportunities ~~and~~Fund ~~determined~~LLC ~~that~~converted ~~the~~$10,756 ~~shares~~of ~~issuable pursuant to~~ the ~~conversion~~principal ~~option~~amount ~~were~~of ~~determinate due to~~ the ~~fixed~~July ~~conversion price and~~10, as2018 ~~such~~note into 49,000,000 ~~does~~shares ~~not~~of ~~constitute~~the aCompany’s ~~derivative~~common ~~liability~~stock, asleaving ~~the~~a ~~Company~~principal ~~has~~balance ~~sufficient~~due ~~authorized~~of ~~shares~~$15,811.

~~Promissory~~On June ~~Note~~18, ~~Payable~~2019, -FirstFire ~~Third~~Global ~~Party~~Opportunities Fund LLC converted $7,767 of the principal amount of the July 10, 2018 note into 49,000,000 shares of the Company’s common stock, leaving a principal balance due of $8,044.

On June ~~July 20~~26, ~~2017~~2019, ~~the~~FirstFire ~~Company~~Global ~~signed~~Opportunities aFund ~~promissory~~LLC ~~note~~converted of $~~100~~4,~~000~~656 ~~with~~of ~~Donovan~~the ~~Olson.~~principal ~~This~~amount ~~interest~~of ~~free~~the ~~note~~July is10, ~~due~~2018 ~~and~~note ~~payable within one year and bears no interest. The Company issued 1~~into 48,000,000 ~~warrants~~shares ~~to Donovan Olson in connection with this note, with an exercise price~~ of ~~$0.10,~~the ~~and~~Company’s ~~expiry~~common ~~date of July 20~~stock, ~~2027.~~leaving ~~The Company recorded~~ a ~~warrant~~principal ~~discount~~balance ~~equal~~due toof $~~100~~3,~~000 due to this warrant feature~~388.

On August ~~May 9~~6, ~~2018~~2019, the ~~Company~~convertible ~~converted the $100,000 promissory~~ note ~~with Donovan Olson,~~ to ~~1,000,000~~FirstFire ~~shares~~Global ofOpportunities ~~its~~Fund ~~common~~LLC ~~stock~~dated atJuly ~~a conversion price of $0.~~10, ~~per~~2018 ~~share.~~was ~~The~~amended ~~company~~to ~~recorded~~increase ~~debt~~the principal ~~discount~~by ~~amortization expense of~~ $6925,~~452~~000 ~~during~~for ~~the quarter ended May 31~~$25,000 ~~2018, related to this debt’s conversion recorded at inception. The note had imputed interest~~ of $1cash consideration,~~917~~ ~~during~~increasing the ~~quarter~~principal ~~ended~~balance ~~May~~due ~~31,~~to ~~2018~~$28,388.

26The Company ~~Table~~evaluated ofthe ~~Contents~~convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the fixed conversion price and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares.

~~Note~~EMA Financial ~~14.~~- ~~Transactions~~Note ~~with Former Officer and Current Shareholder~~ 1

~~The~~On October 22, 2018, the Company ~~was~~issued ~~founded~~a inconvertible ~~1982~~note ~~and~~to ~~managed~~EMA byFinancial, ~~Richard~~LLC ~~Pomije~~for ~~since~~$53,000 atof ~~least~~cash ~~1987~~consideration. OnThe ~~May~~note 17bears interest at 10%, ~~2015~~matures on October 22, ~~Mr.~~2019, ~~Pomije~~and ~~resigned~~is asconvertible ~~CEO~~into common stock at 61% of the ~~Company~~lowest ~~and~~3 onclosing ~~June~~market 1,prices of ~~2015~~the previous 15 trading days prior to conversion, hewith ~~resigned~~a asfixed ~~the~~floor ~~CFO~~price ~~and~~of ~~Chairman~~$0. At0001. ~~the~~The ~~time~~Company ofrecorded ~~his~~a ~~resignation~~debt discount equal to $53,000 ~~the~~due ~~Company~~to ~~and~~this ~~the~~conversion ~~Board~~feature. ofThe ~~Directors~~note ~~were~~had ~~not~~accrued ~~aware~~interest of ~~any~~$3,349 ~~continuing~~as ~~employment~~of ~~agreement~~August 31, 2019. The ~~Company~~debt ~~released~~discount had ~~Mr.~~a ~~Pomije~~balance onat ~~September~~August 1131, ~~2015~~2019 ~~concurrent~~of ~~with~~$7,551. ~~his~~The ~~closing~~Company recorded debt discount amortization expense of ~~the~~$18,732 ~~Burnsville~~during fiscal 2019, and MN$26,718 ~~office.~~during the first two quarters of fiscal 2020.

On May ~~April 18~~3, ~~2018~~2019, ~~Mr.~~EMA ~~Richard~~Financial ~~Pomije~~LLC ~~was~~converted ~~granted~~$5,105 aof ~~judgement for~~ the ~~lawsuit~~principal heamount ~~filed~~of ~~against~~ the ~~Company~~October ~~on December 5~~25, ~~2016.~~2018 ~~Mr.~~note ~~Pomije~~into ~~was awarded $256~~13,~~488 as damages~~000,000 ~~and~~shares ~~$296,488~~of the ~~as attorney~~Company’s ~~fees~~common ~~and costs~~stock, ~~for~~leaving a ~~total~~principal ~~award~~balance due of $~~552~~73,~~976. During the quarter ending May 31~~968, ~~2018,~~including ~~$10,910~~additional ~~was paid to Mr. Richard Pomije. As at May 31, 2019,~~ $~~542~~25,~~066~~000 ~~has~~default ~~been accrued as payable to Mr~~amounts. ~~Pomije.~~

~~The~~On May ~~Company~~9, ~~filed~~2019, anEMA ~~appeal~~Financial onLLC ~~June~~converted 13$8,832 ~~2018.~~of Onthe ~~April~~principal 1,amount ~~2019,~~of the ~~Court~~October of25, ~~Appeals~~2018 ~~issued~~note ~~its~~into ~~Unpublished~~16,000,000 ~~Opinion~~shares ~~in favor~~ of the Company’s ~~with~~common ~~respect~~stock, toleaving ~~its~~a ~~appeal~~principal ~~filed~~balance ~~against~~due ~~Mr.~~of ~~Richard Pomije’s judgement on June 13~~$65, ~~2018~~994.

On May 914, 2019, ~~Mr.~~EMA ~~Pomije~~Financial ~~agreed~~LLC toconverted ~~extend~~$9,259 ~~scheduling~~of ~~deadlines~~the byprincipal 60amount ~~days~~of tothe ~~negotiate~~October a25, ~~settlement~~2018 ~~prior~~note tointo ~~trial~~20,000,000 ~~which~~shares isof the ~~scheduled~~Company’s ~~for~~common ~~January~~stock, ~~2020.~~leaving a principal balance due of $56,734.

~~Note~~On May ~~15.~~21, ~~Digital~~2019, ~~Currencies~~EMA Financial LLC converted $6,223 of the principal amount of the October 25, 2018 note into 22,000,000 shares of the Company’s common stock, leaving a principal balance due of $50,511.

~~The~~On June ~~Company~~13, ~~has~~2019, ~~entered~~EMA ~~into~~Financial ~~stock~~LLC ~~purchase~~converted ~~agreements with investors~~$5,947 ~~and~~of ~~has~~the ~~accepted~~principal ~~digital~~amount ~~currencies as a form~~ of ~~payment~~the ~~from~~October ~~these investors~~25, in2018 ~~exchange~~note ~~for~~into ~~shares~~37,000,000 shares of the Company’s common stock., leaving a principal balance due of $44,564.

On June ~~May 15~~24, ~~2018~~2019, ~~the~~EMA ~~Company~~Financial ~~issued~~LLC ~~11,385,590~~imposed ~~shares of stock to Catena Fund One~~$4,250 LPin ~~for~~additional ~~1,050,000~~default ~~RHOC~~penalties ~~(RChain~~as ~~Coins).~~allowed ~~The~~under ~~market~~their ~~price of RHOC on May 15~~note, ~~2018~~increasing ~~was~~the ~~$1.58~~principal balance ~~per~~to ~~RHOC, resulting in a value of~~ $148,~~659,000~~814.

On June ~~May~~24, 162019, ~~2018~~EMA Financial LLC converted $4,015 of the ~~Company~~principal ~~sold~~amount ~~63,291.13924~~of ~~RHOCs~~the atOctober ~~$1.56~~25, ~~for~~2018 ~~$100~~note into 53,000,000 ~~resulting~~shares of inthe Company’s common stock, leaving a ~~loss~~principal onbalance ~~exchange~~due of $144,~~282~~799.

On July ~~May 31~~1, ~~2018~~2019, ~~market~~EMA ~~price~~Financial ofLLC ~~RHOC~~converted ~~was~~ $~~1.38~~4,567 ~~resulting~~of inthe anprincipal ~~unrealized~~amount ~~loss~~of onthe ~~exchange~~October ~~of $196~~25,~~070,~~ ~~which~~2018 isnote ~~represented~~into as59,000,000 ~~Accumulated~~shares ~~Other~~of the ~~Comprehensive~~Company’s ~~Income~~common instock, ~~the~~leaving ~~equity~~a ~~section~~principal ofbalance ~~the~~due ~~balance~~of ~~sheet~~$40,231.

~~Our~~On July ~~primary~~1, ~~market~~2019, ~~risk~~EMA ~~exposure~~Financial ~~with~~LLC ~~regard~~converted to$1,991 ~~digital~~of ~~currencies is~~ the ~~volatility~~principal inamount ~~trading~~of ~~prices~~the ~~from~~October ~~day to day~~25, ~~which~~2018 ~~would~~note ~~only~~into ~~impact~~31,000,000 ~~the~~shares ~~gain/loss recognized at time~~ of the ~~exchange~~Company’s oncommon ~~such instruments. As of May 31~~stock, ~~2019,~~leaving ~~the~~a ~~Company~~principal ~~held~~balance nodue ~~digital~~of ~~currencies~~$38,240.

~~Note~~The Company ~~16.~~evaluated ~~Discontinued~~the ~~Operations~~convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the fixed conversion price and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares.

~~Appointment.com~~JSJ Investments ~~Disposal~~- Note 1

On October 922, 2018, the ~~Appointment.com~~Company ~~division~~issued ~~was~~a ~~sold~~convertible note to anJSJ ~~arms~~Investments ~~length~~Inc. ~~third party~~ for $~~150~~59,~~000~~500 inof cash consideration. The note bears interest at 12%, ~~less~~matures on October 22, 2019, and is convertible into common stock at 61% of the lowest 3 closing ~~costs~~market prices of the previous 20 trading days prior to conversion, with a fixed floor price of $170.0001. The Company recorded a debt discount equal to $57,~~028~~000 due to this conversion feature. The Company also recorded a $2,500 ~~resulting~~debt indiscount due to issuance fees. The note had accrued interest of $5,119 as of August 31, 2019. The debt discount had a ~~net~~balance ~~gain~~at onAugust ~~disposal~~31, 2019 of ~~asset~~$8,477. The Company recorded debt discount amortization expense of $~~132~~21,~~972~~029 induring fiscal 2019., and $29,995 during the first two quarters of fiscal 2020.

~~There~~On May ~~are~~6, no2019, ~~assets~~JSJ ~~and~~Investments noInc. ~~liabilities~~converted ~~held~~$8,137 ~~for~~of ~~sale~~the onprincipal ~~May~~amount 31of the October 22, ~~2019.~~2018 note into 15,067,787 shares of the Company’s common stock, leaving a principal balance due of $51,363.

~~The~~On May ~~following~~16, ~~table~~2019, ~~summarizes~~JSJ Investments Inc. converted $8,741 of the ~~income~~principal ~~(loss)~~amount ~~from~~of ~~discontinued~~the ~~operations~~October ~~for~~22, ~~Appointment.com:~~2018 note into 20,087,963 shares of the Company’s common stock, leaving a principal balance due of $42,622.

	For the Three Months Ended May 31,
	2019		2018
Revenues		-	$	22,518
Cost of revenues		-		9,425
Gross profit (loss)		-	$	13,093
Operating expenses:
Selling, general and administrative expenses		-		2,250
Income from operations		-		10,843
Income tax provision		-
Net income (loss)		-	$	10,843

On May 21, 2019, JSJ Investments Inc. converted $7,637 of the principal amount of the October 22, 2018 note into 24,245,023 shares of the Company’s common stock, leaving a principal balance due of $34,985.

27On May ~~Table~~28, 2019, JSJ Investments Inc. converted $6,736 of ~~Contents~~the principal amount of the October 22, 2018 note into 35,389,771 shares of the Company’s common stock, leaving a principal balance due of $28,249.

~~got~~On June 21, 2019, JSJ Investments Inc.~~law~~ ~~Disposal~~converted $1,909 of the principal amount of the October 22, 2018 note into 21,209,456 shares of the Company’s common stock, leaving a principal balance due of $26,340.

On December 11, 2018, the got.law division was sold to related party for $1 in cash consideration and $20,000 in forgiveness of debt, resulting in a gain on disposal of asset of $20,001 in fiscal 2019. This gain was recorded to additional paid in capital as it represented contributed capital due to its related party nature. 27

~~There~~The Company ~~are~~evaluated nothe ~~assets~~convertible note and nodetermined ~~liabilities~~that ~~held~~the ~~for~~shares ~~sale~~issuable onpursuant ~~May~~to 31the conversion option were determinate due to the fixed conversion price and, ~~2019.~~as such, does not constitute a derivative liability as the Company has sufficient authorized shares.

~~The~~Auctus Fund ~~following~~- ~~table~~Note ~~summarizes the income (loss) from discontinued operations for got.law:~~ 1

	For the Three Months Ended May 31,
	2019		2018
Revenues		-		-
Cost of revenues		-	$	41,932
Gross profit (loss)		-		(41,932	)
Operating expenses:
Selling, general and administrative expenses		-		14,611
Income from operations		-		(56,543	)
Income tax provision		-		-
Net income (loss)		-	$	(56,543	)

On November 14, 2018, the Company issued a convertible note to Auctus Fund, LLC for $85,000 of cash consideration. The note bears interest at 12%, matures on November 14, 2019, and is convertible into common stock at 61% of the lowest trading price of the previous 25 trading days prior to conversion, with a fixed floor price of $0.0001. The Company recorded a debt discount equal to $77,750 due to this conversion feature. The Company also recorded a $7,250 debt discount due to issuance fees. The note had accrued interest of $1,070 as of August 31, 2019. The debt discount had a balance at August 31, 2019 of $17,466. The Company recorded debt discount amortization expense of $24,685 during fiscal 2019, and $42,849 during the first two quarters of fiscal 2020.

~~Rezserve~~On May ~~Disposal~~17, 2019, Auctus Fund, LLC converted $2,334 of the principal amount and $5,086 of accrued and unpaid interest of the November 14, 2018 note into 21,998,800 shares of the Company’s common stock, leaving a principal balance due of $82,666.

On May ~~February 26~~28, 2019, ~~the~~Auctus ~~Company~~Fund, ~~sold~~LLC ~~the~~converted ~~assets~~$7,440 of ~~it’s~~the ~~fully~~principal ~~owned~~amount ~~subsidiary,~~and ~~Rezserve~~$299 ~~Technologies~~of ~~Ltd.,~~accrued toand anunpaid ~~arms~~interest ~~length~~of ~~third~~the ~~party~~November 14, ~~for~~2018 ~~$30~~note into 34,~~000~~328,200 inshares ~~cash~~of ~~consideration,~~the ~~resulting~~Company’s incommon astock, ~~gain~~leaving ona ~~disposal~~principal ofbalance ~~asset~~due of $3075,~~000 in fiscal 2019~~227.

~~There~~On June ~~are~~6, no2019, ~~assets~~Auctus Fund, LLC converted $6,162 of the principal amount and no$223 ~~liabilities~~of ~~held~~accrued ~~for~~and ~~sale~~unpaid oninterest ~~May~~of 31the November 14, ~~2019.~~2018 note into 43,027,563 shares of the Company’s common stock, leaving a principal balance due of $69,065.

~~The~~On July ~~following~~3, ~~table~~2019, ~~summarizes~~Auctus Fund, LLC converted $3,943 of the ~~income~~principal ~~(loss)~~amount ~~from~~and ~~discontinued~~$613 ~~operations~~of ~~for~~accrued ~~Rezserve:~~and unpaid interest of the November 14, 2018 note into 63,199,100 shares of the Company’s common stock, leaving a principal balance due of $65,122.

	For the Three Months Ended May 31,
	2019		2018
Revenues		-	$	26,731
Cost of revenues		-		19,879
Gross profit (loss)		-		6,852
Operating expenses:
Selling, general and administrative expenses		-		24,523
Income from operations		-		(17,671	)
Income tax provision		-		-
Net income (loss)		-	$	(17,671	)

On July 9, 2019, Auctus Fund, LLC converted $2,778 of the principal amount and $128 of accrued and unpaid interest of the November 14, 2018 note into 42,574,829 shares of the Company’s common stock, leaving a principal balance due of $62,344.

28The Company ~~Table~~evaluated ofthe ~~Contents~~convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the fixed conversion price and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares.

~~Comencia~~Promissory Note ~~Disposal~~Payable - Third Party

On July ~~February 26~~20, ~~2019~~2017, the Company ~~sold~~signed ~~the~~a ~~assets~~promissory note of ~~it’s~~$100,000 ~~fully~~with ~~owned~~Donovan ~~subsidiary,~~Olson. ~~Comencia~~This ~~Inc~~interest free note is due and payable within one year and bears no interest. The Company issued 1,000,000 warrants to anDonovan ~~arms~~Olson ~~length~~in ~~third~~connection ~~party~~with ~~for~~this note, with an exercise price of $300.10,~~000~~ inand ~~cash~~expiry ~~consideration~~date of July 20, ~~resulting~~2027. inThe aCompany ~~gain~~recorded ona ~~disposal~~warrant ofdiscount ~~asset~~equal ofto $30100,000 indue ~~fiscal~~to this ~~2019.~~warrant feature.

~~There~~On May ~~are~~9, no2018, ~~assets~~the ~~and~~Company noconverted ~~liabilities~~the ~~held~~$100,000 ~~for~~promissory ~~sale~~note onwith Donovan Olson, to 1,000,000 shares of its common stock at a conversion price of $0.10 per share. The company recorded debt discount amortization expense of $69,452 during the quarter ended May 31, ~~2019~~2018, related to this debt’s conversion recorded at inception. The note had imputed interest of $1,917 during the quarter ended May 31, 2018.

~~The~~Note 14. ~~following~~Transactions ~~table~~with ~~summarizes~~Former ~~the~~Officer ~~income~~and ~~(loss)~~Current ~~from discontinued operations for Comencia:~~ Shareholder

	For the Three Months Ended May 31,
	2019		2018
Revenues		-	$	15,044
Cost of revenues		-		47,040
Gross profit (loss)		-		(31,996	)
Operating expenses:
Selling, general and administrative expenses		-		6,791
Income from operations		-		(38,786	)
Income tax provision		-		-
Net income (loss)		-	$	(38,786	)

The Company was founded in 1982 and managed by Richard Pomije since at least 1987. On May 17, 2015, Mr. Pomije resigned as CEO of the Company and on June 1, 2015, he resigned as the CFO and Chairman. At the time of his resignation, the Company and the Board of Directors were not aware of any continuing employment agreement. The Company released Mr. Pomije on September 11, 2015 concurrent with his closing of the Burnsville, MN office.

~~Note~~On December 5, 2016, Richard Pomije filed a lawsuit against the Company. Mr. Pomije asserts an employment agreement existed and a continuing obligation of the Company in the form of a monthly salary for a 1 year term from May 18, 2015 to May 17, 2016 was due in addition to a stock subscription receivable. ~~Subsequent~~Mr. ~~Events~~Pomije claims the Company owes him $260,900, which had been fully accrued for by the Company as of February 28, 2017.

~~Borrowings~~On April 18, 2018, Mr. Richard Pomije was granted a judgement for the lawsuit he filed against the Company on December 5, 2016. Mr. Pomije was awarded $256,488 as damages, and $296,488 as attorney’s fees and costs, for a total award of $552,976. During the quarter ending May 31, 2018, $10,910 was paid to Mr. Richard Pomije. As at August 31, 2019, $542,066 has been accrued as payable to Mr. Pomije.

~~On August 6, 2019, the convertible note to FirstFire Global Opportunities Fund LLC dated July 10, 2018 was amended to increase the principal by $25,000 for $25,000 of cash consideration.~~ 28

~~Note~~The Company ~~Conversions~~filed an appeal on June 13, 2018. On April 1, 2019, the Court of Appeals issued its Unpublished Opinion in favor of the Company with respect to its appeal filed against Mr. Richard Pomije’s judgement on June 13, 2018.

~~Auctus~~On May ~~Fund~~9, -2019, ~~Note~~Mr. 1Pomije agreed to extend scheduling deadlines by 60 days to negotiate a settlement prior to trial. After three months of discussions, Mr. Pomije indicated he was unwilling to settle the matter and would pursue the matter further through the courts. He also indicated his intention to bring additional claims against the Company, its current board members, past board members and officers of the Company if certain demands were not met.

On June 6, 2019, Auctus Fund, LLC converted $6,162 of the principal amount and $223 of accrued and unpaid interest of the November 14, 2018 note into 43,027,563 shares of the Company’s common stock, leaving a principal balance due of $69,065Note 15. Digital Currencies

OnThe Company ~~July~~has 3,entered ~~2019,~~into ~~Auctus~~stock ~~Fund,~~purchase ~~LLC~~agreements ~~converted~~with $3investors,~~943~~ ~~of the principal amount~~ and ~~$613~~has ofaccepted ~~accrued~~digital ~~and~~currencies ~~unpaid~~as ~~interest~~a form of ~~the~~payment ~~November~~from these 14investors, ~~2018~~in ~~note~~exchange ~~into~~for ~~63,199,100~~ shares of the Company’s common stock~~, leaving a principal balance due of $65,122~~.

On May ~~July 9~~15, ~~2019~~2018, ~~Auctus~~the ~~Fund,~~Company ~~LLC~~issued ~~converted $2~~11,~~778~~385,590 shares of ~~the~~stock ~~principal~~to ~~amount~~Catena ~~and~~Fund ~~$128~~One, ofLP ~~accrued~~for ~~and~~1,050,000 ~~unpaid~~RHOC ~~interest~~(RChain ofCoins). ~~the~~The ~~November~~market price ~~14,~~of ~~2018~~RHOC ~~note~~on ~~into~~May 4215,~~574,829~~ ~~shares~~2018 ofwas ~~the~~$1.58 ~~Company’s~~per ~~common stock~~RHOC, ~~leaving~~resulting in a ~~principal~~value ~~balance due~~ of $621,~~344~~659,000.

~~FirstFire~~On May ~~Global~~16, ~~Opportunities~~2018, -the ~~Note~~Company sold 63,291.13924 RHOCs at $1.56 for $100,000, resulting in a loss on exchange of $1,282.

On May ~~June 13~~31, ~~2019~~2018, ~~FirstFire~~market ~~Global~~price ~~Opportunities~~of ~~Fund~~RHOC ~~LLC~~was ~~converted~~ $91.38,~~780~~ ofresulting ~~the~~in ~~principal~~an ~~amount~~unrealized ofloss ~~the~~on ~~July~~exchange ~~10,~~of ~~2018 note into 45~~$196,~~000~~070,~~000~~ ~~shares~~which ofis ~~the~~represented ~~Company’s~~as Accumulated ~~common~~Other ~~stock,~~Comprehensive ~~leaving~~Income ain ~~principal~~the ~~balance~~equity ~~due~~section of ~~$26,567.~~the balance sheet.

OnOur primary ~~June~~market ~~17,~~risk ~~2019,~~exposure ~~FirstFire~~with ~~Global~~regard ~~Opportunities~~to ~~Fund~~digital ~~LLC~~currencies ~~converted~~is ~~$10,756~~the ofvolatility ~~the~~in ~~principal~~trading ~~amount~~prices offrom ~~the~~day ~~July~~to 10day, ~~2018~~which ~~note~~would only ~~into~~impact ~~49,000,000~~the ~~shares~~gain/loss ofrecognized ~~the~~at ~~Company’s~~time ~~common~~of ~~stock,~~exchange ~~leaving~~on asuch ~~principal~~instruments. ~~balance~~As ~~due~~ of ~~$15~~August 31,~~811.~~ 2019, the Company held no digital currencies.

On June 18, 2019, FirstFire Global Opportunities Fund LLC converted $7,767 of the principal amount of the July 10, 2018 note into 49,000,000 shares of the Company’s common stock, leaving a principal balance due of $8,044Note 16. Discontinued Operations

~~29 Table of Contents~~Appointment.com Disposal

On October ~~June 26~~9, ~~2019~~2018, ~~FirstFire~~the ~~Global~~Appointment.com ~~Opportunities~~division ~~Fund~~was ~~LLC~~sold ~~converted~~to ~~$4,656~~an ofarms ~~the~~length ~~principal~~third ~~amount~~party offor ~~the~~$150,000 ~~July~~in 10cash consideration, ~~2018~~less closing ~~note~~costs ~~into~~of 48$17,~~000~~028,~~000~~ ~~shares~~resulting ofin ~~the~~a ~~Company’s~~net ~~common~~gain ~~stock,~~on ~~leaving~~disposal aof ~~principal~~asset ~~balance due~~ of $3132,~~388.~~972 in fiscal 2019.

~~EMA~~There are ~~Financial~~no -assets ~~Note~~and 1no liabilities held for sale on August 31, 2019.

OnThe following ~~June~~table ~~13,~~summarizes ~~2019, EMA Financial LLC converted $5,947 of~~ the ~~principal~~income ~~amount~~(loss) offrom ~~the~~discontinued ~~October~~operations ~~25,~~for ~~2018 note into 37,000,000 shares of the Company’s common stock, leaving a principal balance due of $44,564~~Appointment. com:

On June 24, 2019, EMA Financial LLC imposed $4,250 in additional default penalties as allowed under their note, increasing the principal balance to $48,814.

	For the Six Months Ended August 31,
	2019		2018

Revenues		-	$	43,726
Cost of revenues		-		18,850
Gross profit (loss)		-	$	24,876

Operating expenses:
Selling, general and administrative expenses		-		4,500

Income (loss) from operations		-		20,376

Income tax provision		-
Net income (loss)		-	$	20,376

On June 24, 2019, EMA Financial LLC converted $4,015 of the principal amount of the October 25, 2018 note into 53,000,000 shares of the Company’s common stock, leaving a principal balance due of $44,799got. law Disposal

On December ~~July 1~~11, ~~2019~~2018, ~~EMA~~the ~~Financial~~got.law ~~LLC~~division ~~converted~~was sold to related party for $41 in cash consideration and $20,~~567~~000 in forgiveness of ~~the~~debt, resulting ~~principal~~in ~~amount~~a gain on disposal of ~~the~~asset ~~October~~of 25$20,001 ~~2018~~in ~~note~~fiscal ~~into~~2019. ~~59,000,000~~This ~~shares~~gain ofwas ~~the~~recorded ~~Company’s~~to ~~common~~additional ~~stock,~~paid ~~leaving~~in acapital ~~principal~~as ~~balance~~it represented contributed capital due ofto ~~$40,231.~~its related party nature.

On July 1, 2019, EMA Financial LLC converted $1,991 of the principal amount of the October 25, 2018 note into 31,000,000 shares of the Company’s common stock, leaving a principal balance due of $38,240. 29

~~JSJ~~There are ~~Investments~~no -assets ~~Note~~and 1no liabilities held for sale on August 31, 2019.

OnThe following ~~June~~table ~~21,~~summarizes ~~2019, JSJ Investments Inc. converted $1,909 of~~ the ~~principal~~income ~~amount~~(loss) offrom ~~the~~discontinued ~~October~~operations ~~22,~~for ~~2018 note into 21,209,456 shares of the Company’s common stock, leaving a principal balance due of $26,340~~got. law:

Other Conversions

	For the Six Months Ended August 31,
	2019		2018

Revenues		-	$	116
Cost of revenues		-		87,121
Gross profit (loss)		-	$	(87,005	)

Operating expenses:
Selling, general and administrative expenses		-		31,063

Income (loss) from operations		-		(118,068	)

Income tax provision		-		-
Net income (loss)		-	$	(118,068	)

~~In the second quarter of fiscal 2020, $527,248 of accounts payable and accrued payables was converted to stock payable.~~ Rezserve Disposal

On February ~~June 10~~26, 2019, the Company ~~converted~~sold athe ~~deferred~~assets ~~revenue~~of ~~customer~~its fully owned subsidiary, Rezserve Technologies Ltd., to an arms length third party for $30,000 in ~~the~~cash ~~amount~~consideration, resulting in a gain on disposal of asset of $1630,~~305~~000 toin ~~stock~~fiscal ~~payable~~2019.

~~Preferred~~There are ~~Shares~~no assets and no liabilities held for sale on August 31, 2019.

~~In June 2019, the Company issued 51 preferred shares to Sam Ciacco with super-voting characteristics, to facilitate an increase of the Authorized Common Stock limit.~~ The following ~~additional~~table ~~availability~~summarizes ~~of shares will eventually allow~~ the ~~Company~~income to(loss) ~~continue~~from ~~meeting~~discontinued ~~its~~operations ~~obligations~~for ~~and secure its ability to fund minimum operating requirements.~~ Rezserve:

There were no additional significant subsequent events through August 22, 2019, the date the financial statements were issued.

	For the Six Months Ended August 31,
	2019		2018

Revenues		-	$	53,334
Cost of revenues		-		37,467
Gross profit (loss)		-	$	15,867

Operating expenses:
Selling, general and administrative expenses		-		49,928

Income (loss) from operations		-		(34,061	)

Income tax provision		-		-
Net income (loss)		-	$	(34,061	)

~~30 Table of Contents~~Comencia Disposal

~~ITEM~~On February 226, 2019, the Company sold the assets of its fully owned subsidiary, Comencia Inc., ~~MANAGEMENT'S~~to ~~DISCUSSION~~an ~~AND~~arms ~~ANALYSIS~~length OFthird ~~FINANCIAL~~party for ~~CONDITION~~$30,000 ~~AND~~in ~~RESULTS~~cash OFconsideration, ~~OPERATIONS~~resulting in a gain on disposal of asset of $30,000 in fiscal 2019.

~~The~~There are ~~following~~no isassets ~~a discussion of the financial condition as of May 31, 2019~~ and ~~its~~no ~~results~~liabilities ofheld ~~operations of the Company~~ for ~~the~~sale ~~three~~on ~~months~~August ~~ended May~~ 31, 2019 and 2018, which should be read in conjunction with, and is qualified in its entirety by, the financial statements and notes thereto included elsewhere in this report and the audited consolidated financial statements and notes thereto included in the Company’s Form 10-K for the fiscal year ended February 28, 2019.

~~CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION~~ 30

This Form 10-Q for the quarter ended May 31, 2019, contains forward-looking statements. Forward-looking statements may be identified by the use of forward-looking terminology, such as "may," "shall," "could," "expect," "estimate," "anticipate," "predict," "probable," "should," "continue," or similar terms, variations of those terms or the negative of those terms. The following ~~forward-looking~~table ~~statements~~summarizes ~~specified in~~ the ~~following~~income ~~information~~(loss) have been compiled by our management and are considered by management to be reasonable. Our future operating results, however, may be materially different and no representation, guaranty, or warranty is to be inferred from ~~those~~discontinued ~~forward-looking~~operations ~~statements.~~for Comencia:

GENERAL

	For the Six Months Ended August 31,
	2019		2018

Revenues		-	$	45,617
Cost of revenues		-		73,420
Gross profit (loss)		-		(27,803	)

Operating expenses:
Selling, general and administrative expenses		-		14,055

Income from operations		-		(41,858	)

Income tax provision		-		-
Net income (loss)		-	$	(41,858	)

~~DigitalTown, Inc~~Note 17. ~~(“The~~Subsequent ~~Company”,~~Events “We”, “Us”, “Our” and “DigitalTown”) provides turn-key hosted solutions to power a comprehensive platform for government entities, citizens and merchants. Our solutions improve the quality of life for residents and visitors through integrated technology for economic development, civic engagement, digital inclusion and smart tourism for cities around the world. The easy to use platform helps city officials and local merchants manage a feature-rich Smart City for web and mobile devices, and provides residents and visitors with access to Content, Community and Commerce.

The Company’s fiscal year end is the last day in February. Our current fiscal year ends on February 29, 2020 and we refer to it as “fiscal 2020”. Last year, our fiscal year ended on February 28, 2019 and we refer to this year as “fiscal 2019”. Borrowings

~~Market~~On November ~~Opportunity~~6, 2019, the convertible note to FirstFire Global Opportunities Fund LLC dated July 10, 2018 was amended to increase the principal by $35,000 for $35,000 of cash consideration.

We provide an integrated search, community, and commerce platform for both web and mobile devices. DigitalTown powers connected online communities that enable members of a community to find information and acquire the goods and services they need locally when possible. The DigitalTown platform is intended to improve how the local economy consumes and transacts. It does this by helping local community citizens interact with city government, as well as local merchants. Residents and visitors are able to use the DigitalTown powered search engine to access content, community and commerce from an easy search tool. If there are local vendors that can fulfill a product or service that relates to a search term, then those options are presented to the user. Local vendors can also become direct merchants on the platform, effectively allowing the local town to be its own hub for mass commerce. Note Conversions

~~The~~PowerUp Lending ~~Strategic~~- ~~Importance~~Note ~~of Local Online Economic Development~~ 6

~~The~~On September ~~DigitalTown~~3, ~~platform~~2019, ~~elevates~~Power ~~local~~Up ~~communities~~Lending toGroup anLtd. ~~advanced~~converted ~~state~~$3,000 of ~~technical~~the ~~capability.~~principal ~~To date~~amount, ~~most~~plus ~~cities~~$750 ~~have~~in ~~historically~~accrued ~~taken~~and aunpaid ~~hands-off~~interest, of ~~approach towards~~ the ~~Internet.~~January ~~However~~22, we2019 ~~believe~~note ~~city~~into ~~management~~75,000,000 ~~will~~shares ~~further~~of ~~consider~~ the ~~Internet~~Company’s ascommon anstock, ~~integral~~fully ~~part~~extinguishing ofthis ~~their strategic plan for economic growth~~note.

~~The~~EMA Financial continued expansion of big box retailers and steep growth of national eCommerce has created an increased number of challenges for locally owned small businesses. This requires a new approach to online economic development – one that equips local merchants with the means to compete locally and sell nationally. DigitalTown provides a cost-~~effective~~ ~~solution~~Note ~~to help local businesses compete against entities with greater reach, scale and resources.~~ 1

~~Why~~On September 12, 2019, EMA Financial LLC converted $2,359 of the ~~DigitalTown~~principal ~~solution~~amount ~~makes~~of ~~sense~~the ~~now~~October 25, 2018 note into 70,000,000 shares of the Company’s common stock, leaving a principal balance due of $35,881.

~~The~~On September ~~DigitalTown platform is a cost-effective solution for enabling a community to become a smart community~~24, ~~which we define as connected to shared content and local commerce. A key enabler for this capability is the continued growth of smartphones that are powered by common frameworks~~2019, ~~such~~EMA asFinancial ~~Apple~~LLC ~~iOS~~converted ~~and Android. The use of smartphones has enabled individuals to communicate and transact in real-time anywhere they choose using their smartphone~~$2,727 ~~which serves as a proxy for identity, reputation, preferences and method~~ of ~~payment. In effect,~~ the ~~smartphone~~principal ~~has~~amount ~~become~~of the ~~Digital~~October ~~Wallet. We believe this opportunity is global and our approach~~25, ~~which~~2018 ~~emphasizes~~note ~~public-private~~into ~~partnerships~~78,000,000 ~~will enable accelerated adoption particularly in rural communities where trust~~ shares of ~~technology is lower,~~ the ~~need~~Company’s iscommon ~~potentially the greatest~~stock, ~~and~~leaving ~~economic~~a ~~models~~principal ~~are~~balance atdue ~~the~~of ~~greatest risk~~$33,154.

~~How~~JSJ Investments ~~the~~- ~~DigitalTown~~Note ~~SmartCity Platform is part of the new SmartWeb~~ 1

AOn September ~~core~~12, ~~component~~2019, ofJSJ ~~the~~Investments ~~DigitalTown~~Inc. ~~approach~~converted is$3,836 toof ~~build~~the ~~branded~~principal ~~web~~amount ~~destinations that are intuitive to discover. Part~~ of ~~what makes this possible is~~ the ~~emergence~~October of22, ~~new~~2018 ~~domain~~note ~~extensions~~into ~~that are descriptive. For example~~85,255,113 shares ~~.CITY~~of ~~routes~~the ~~a visitor to a website about a city and .MENU routes a user to a website about restaurants in that city. Due to management~~Company’s ~~long-standing~~common ~~relation with domain registry operators~~stock, ~~the~~leaving ~~Company will seek to bring structure to the emerging landscape of domain extensions, while at the same time emphasizing distribution of~~ a ~~unified~~principal ~~mobile~~balance ~~application~~due ~~to work as a digital companion alongside the growing network~~ of ~~direct navigation brands~~$22,503.

~~The~~On September ~~DigitalTown~~23, ~~Platform~~2019, JSJ Investments Inc. converted $4,505 of the principal amount of the October 22, 2018 note into 100,110,889 shares of the Company’s common stock, leaving a principal balance due of $17,998.

~~The~~On October ~~DigitalTown~~9, ~~platform~~2019, ~~supports~~JSJ ~~powerful~~Investments ~~online and mobile communities~~Inc. Weconverted ~~tap~~$4,898 ~~into~~of ~~locally~~the ~~relevant~~principal ~~news~~amount ~~and~~of ~~content~~the inOctober ~~order~~22, to2018 ~~keep~~note ~~community~~into ~~members~~108,838,322 ~~informed.~~shares of Wethe ~~provide~~Company’s ~~community~~common ~~tools~~stock, toleaving ~~keep~~a ~~community~~principal ~~members~~balance ~~connected.~~due Weof ~~enable commerce and fulfillment in local communities thereby helping residents to buy locally while equipping merchants to sell locally~~$13, ~~nationally and even globally~~100.

31Auctus Fund ~~Table~~- ofNote ~~Contents~~1

~~Content~~On September ~~Search~~11, 2019, Auctus Fund, LLC converted $641 of the principal amount and $1,899 of accrued and unpaid interest of the November 14, 2018 note into 76,012,000 shares of the Company’s common stock, leaving a principal balance due of $61,703.

~~The~~On October ~~DigitalTown~~2, ~~search~~2019, ~~engine~~Auctus ~~serves~~Fund, asLLC ~~the~~converted ~~core~~$3,082 of the ~~local~~principal ~~experience.~~amount ~~Whereas most residents may go once or twice per year to the official city site, the DigitalTown-powered search engine is designed for daily use as a preferred homepage for local residents~~ and ~~businesses.~~$852 ~~This will be accomplished through a combination~~ of ~~marketing~~accrued and ~~education~~unpaid tointerest ~~residents. In addition, we believe adoption can happen through building a strong level~~ of ~~trust with~~ the ~~residents~~November 14, ~~since~~2018 ~~our~~note ~~platform~~into ~~will~~110,837,250 beshares ~~endorsed~~of ~~or supported by~~ the ~~local~~Company’s ~~government~~common ~~whom~~stock, ~~the~~leaving ~~residents~~a ~~know.~~principal ~~This~~balance ~~compares~~due toof ~~large national companies with limited to no connection to the local residents~~$58,622.

~~Community~~On November 18, 2019, Auctus Fund, LLC converted $1,342 of the principal amount and $1,812 of accrued and unpaid interest of the November 14, 2018 note into 121,799,000 shares of the Company’s common stock, leaving a principal balance due of $57,280.

Consumers are already familiar with social networking through applications like Facebook and Twitter. The integrated DigitalTown web service and mobile app make it easy to stay informed, as well as to connect and communicate with other members of a given community. Community members can message, join groups, shop online, and make payments. Stock Transactions

~~Commerce~~In September 2019, 71,935,993 shares of the Company’s common stock were issued for $528,385 of stock payable.

~~The~~There were ~~DigitalTown~~no ~~platform~~additional ~~provides~~significant ~~merchants~~subsequent ~~with~~events athrough ~~turn-key~~December ~~solution~~2, ~~for online commerce. Once the approved merchant loads SKU’s and inventory available for sale~~2019, the ~~merchants~~date ~~can begin selling without any setup fees or capital investment costs. Transaction processing services are provided by DigitalTown, thereby eliminating~~ the ~~need~~financial ~~for~~statements ~~each~~were ~~retailer to secure a merchant processing account~~issued. ~~The community may also enable a private currency for use within the community.~~

~~Courier and Delivery Management~~ 31

In a growing number of participating cities, an integrated courier and delivery application is included, enabling approved delivery service providers to be notified about items from merchants to be picked up and delivered to the customer, thereby enabling any approved merchant to also offer delivery services to the end-customerITEM 2. ~~Delivery~~MANAGEMENT’S ~~time~~DISCUSSION isAND ~~chosen~~ANALYSIS byOF ~~the~~FINANCIAL ~~customer~~CONDITION ~~and~~AND ~~can~~RESULTS beOF ~~hours to days.~~ OPERATIONS

~~Administration~~The following is a discussion of the financial condition as of August 31, 2019 and its results of operations of the Company for the six months ended August 31, 2019 and 2018, which should be read in conjunction with, and is qualified in its entirety by, the financial statements and notes thereto included elsewhere in this report and the audited consolidated financial statements and notes thereto included in the Company’s Form 10-K for the fiscal year ended February 28, 2019.

~~The~~CAUTIONARY STATEMENT ~~DigitalTown~~REGARDING ~~platform~~FORWARD-LOOKING provides integrated administrative tools for managing Content, Community and Commerce, making it easy to administer. The administrative tools are designed to be the back end of the smart community. For example, administrators can create Frequently Asked Questions (FAQ) that are then presented through the site search. This FAQ article is then systematically provided as information when a user makes an inquiry that matches the keywords into the search box on the site. INFORMATION

~~Intellectual~~This Form ~~Property~~10-Q for the quarter ended August 31, 2019, contains forward-looking statements. Forward-looking statements may be identified by the use of forward-looking terminology, such as “may,” “shall,” “could,” “expect,” “estimate,” “anticipate,” “predict,” “probable,” “should,” “continue,” or similar terms, variations of those terms or the negative of those terms. The forward-looking statements specified in the following information have been compiled by our management and are considered by management to be reasonable. Our future operating results, however, may be materially different and no representation, guaranty, or warranty is to be inferred from those forward-looking statements.

Domain Name Portfolio. The Company is developing a proprietary platform for Smart City Management. As part of this platform rollout, the Company has secured approximately 13,000 of the .CITY domains that map to significant population centers. DigitalTown has methodically secured the .CITY domains through both acquisition from existing registrants, or via direct purchase from the operator of the .CITY registrar. GENERAL

~~Software:~~DigitalTown, Inc. (“The Company”, ~~has~~“We”, ~~developed~~“Us”, a“Our” ~~proprietary~~and ~~platform~~“DigitalTown”) ~~for~~provides turn-key ~~enabling~~hosted ~~any~~solutions ~~city~~ to ~~become~~power a ~~Smart~~comprehensive ~~City,~~platform ~~incorporating advanced features~~ for ~~economic~~government ~~development~~entities, ~~community~~citizens ~~engagement~~ and ~~digital inclusion~~merchants. InOur ~~addition,~~solutions improve the ~~Company~~quality ~~has completed acquisitions~~ of 7life ~~software~~for ~~companies:~~residents ~~Cloud.Market,~~and ~~Software~~visitors ~~Masters,~~through ~~Inc,~~integrated ~~Rezserve~~technology ~~Technologies~~for ~~Ltd,~~economic ~~Appointment.com~~development, ~~Comencia~~civic ~~Inc~~engagement, ~~Congo~~digital inclusion ~~Ltd.~~ and ~~CityInformation~~smart ~~BV,~~tourism ~~each~~for ofcities ~~which~~around ~~brought~~the ~~significant~~world. ~~intellectual~~The ~~property~~easy ~~and~~to isuse inplatform ~~process~~helps ofcity ~~being~~officials ~~fully~~and ~~integrated~~local ~~into~~merchants ~~the~~manage a ~~DigitalTown~~feature-rich ~~platform.~~Smart ~~The~~City ~~Company~~for ~~continues~~web toand ~~invest~~mobile indevices, ~~software~~and ~~with~~provides anresidents ~~emphasis~~and onvisitors ~~capital~~with ~~efficiency~~access ~~and~~to ~~return~~Content, onCommunity ~~investment~~and Commerce.

~~Dispositions~~The Company’s fiscal year end is the last day in February. Our current fiscal year ends on February 29, 2020 and we refer to it as “fiscal 2020”. Last year, our fiscal year ended on February 28, 2019 and we refer to this year as “fiscal 2019”.

In late fiscal 2019, the Company sold the balance of its useful assets, including 4 of the above-mentioned previously acquired software companies that had not been integrated into the DigitalTown platform. The Company is also no longer acquiring or renewing its domain name portfolio. Market Opportunity

~~RESULTS~~We provide OFan ~~OPERATIONS~~integrated search, community, and commerce platform for both web and mobile devices. DigitalTown powers connected online communities that enable members of a community to find information and acquire the goods and services they need locally when possible. The DigitalTown platform is intended to improve how the local economy consumes and transacts. It does this by helping local community citizens interact with city government, as well as local merchants. Residents and visitors are able to use the DigitalTown powered search engine to access content, community and commerce from an easy search tool. If there are local vendors that can fulfill a product or service that relates to a search term, then those options are presented to the user. Local vendors can also become direct merchants on the platform, effectively allowing the local town to be its own hub for mass commerce.

~~THREE~~The Strategic ~~MONTHS~~Importance ~~ENDED~~of ~~MAY~~Local ~~31,~~Online ~~2019~~Economic ~~AND 2018~~ Development

~~During~~The DigitalTown ~~first~~platform ~~quarter~~elevates oflocal ~~fiscal~~communities ~~2020,~~to ~~the~~an ~~Company~~advanced ~~recorded~~state ~~revenues~~ of ~~$50,000~~technical ~~and~~capability. ~~cost~~To ~~of revenues of $306 for a gross profit of $49~~date,~~694~~ ~~compared~~most tocities ~~revenues~~have ofhistorically taken ~~$21,925 and cost of revenues of $407,052 for~~ a ~~gross~~hands-off ~~loss~~approach oftowards ~~$385,127 during~~ the ~~first quarter of fiscal 2019~~Internet. ~~For the first quarter of fiscal 2020~~However, ~~revenues~~we ~~mainly~~believe ~~consisted~~city ofmanagement ~~development~~will ~~fees.~~further ~~For~~consider the ~~first~~Internet ~~quarter~~as ofan integral ~~fiscal~~part ~~2019, revenues mainly consisted~~ of ~~development~~their ~~fees~~strategic ~~related~~plan to our SmartCity platform and activities from our Rezserve and Appointment.com subsidiaries. Cost of revenues consisted of amortization of prepaid annual domain name renewal fees of $0 and $302,989, development expense of $0 and $103,317, and merchant processing fees of $306 and $746, for ~~the~~economic ~~fiscal first quarters 2020 and 2019, respectively~~growth.

32The continued ~~Table~~expansion of ~~Contents~~big box retailers and steep growth of national eCommerce has created an increased number of challenges for locally owned small businesses. This requires a new approach to online economic development – one that equips local merchants with the means to compete locally and sell nationally. DigitalTown provides a cost-effective solution to help local businesses compete against entities with greater reach, scale and resources.

The Company’s operating expenses are currently all related to selling, general and administrative activity. These expenses were $342,374 in the first quarter of fiscal 2020 compared to $1,175,444 in the first quarter of fiscal 2019, a decrease of $833,070. A portion of this increase was non-cash related. Our stock-based compensation expense was $221,392 for the first quarter of fiscal 2020 as compared to $436,406 for fiscal 2019, a decrease of $215,014. In addition to the non-cash item, our decrease in selling, general and administrative expenses was due to a decrease in domain name renewal fees of $302,989, a decrease in development costs of $221,209, a decrease in salaries and related costs of $358,239, and a decrease of $66,692 in accounting and advisory fees. 32

~~The Company’s loss from discontinued operations was $0 in~~ Why the ~~first~~DigitalTown ~~quarter~~solution ofmakes ~~fiscal~~sense ~~2020, compared to $102,157 in the first quarter of fiscal 2019, a decrease of $102,157.~~ now

The DigitalTown ~~Company’s~~platform ~~overall~~is ~~net~~a ~~loss~~cost-effective ~~from~~solution ~~continuing~~for ~~operations~~enabling a community to become a smart community, which we define as connected to shared content and local commerce. A key enabler for this capability is the ~~current~~continued ~~first~~growth ~~quarter~~of ~~decreased~~smartphones that are powered by $1common frameworks,~~595,418~~ tosuch ~~$558,567~~as Apple iOS and Android. The ~~decrease~~use ~~was~~of ~~mainly~~smartphones ~~due~~has enabled individuals to acommunicate ~~decrease~~and transact in ~~stock~~real-time ~~compensation~~anywhere ~~expense~~they choose using their smartphone, which serves as a ~~decrease~~proxy infor ~~debt~~identity, reputation, preferences and ~~warrant~~method of ~~discount~~payment. ~~amortization~~In effect, athe ~~decrease~~smartphone inhas ~~prepaid~~become ~~annual~~the ~~domain~~Digital ~~name~~Wallet. ~~renewal~~We ~~fees,~~believe this opportunity is global and ~~the~~our ~~decrease~~approach, which emphasizes public-private partnerships, will enable accelerated adoption particularly in ~~general~~rural communities where trust of technology is lower, the need is potentially the greatest, and ~~administrative~~economic ~~items~~models asare ~~detailed~~at ~~above.~~the greatest risk.

~~LIQUIDITY~~How the ~~AND~~DigitalTown ~~CAPITAL~~SmartCity ~~RESOURCES~~Platform is part of the new SmartWeb

~~The~~A core ~~Company’s~~component ~~cash~~of ~~position~~the atDigitalTown ~~May~~approach ~~31,~~is ~~2019~~to ~~was~~build ~~$34,462,~~branded anweb ~~increase~~destinations ofthat ~~$19,191~~are ~~from~~intuitive ~~$15,271~~to atdiscover. ~~February~~Part ~~28,~~of ~~2019.~~what ~~During~~makes this ~~the~~possible ~~first~~is ~~quarter~~the emergence of ~~fiscal~~new ~~2020,~~domain ~~net~~extensions ~~cash~~that ~~used~~are indescriptive. ~~operating~~For ~~activities~~example, ~~was~~.CITY ~~$26,024~~routes ~~compared~~a visitor to ~~cash~~a ~~used~~website about ofa ~~$662,436~~city ~~for~~and ~~the~~.MENU ~~first~~routes ~~quarter~~a ofuser ~~fiscal~~to ~~2019~~a website about restaurants in that city. ~~When~~Due ~~comparing~~to ~~the~~management’s ~~two~~long-standing ~~periods~~relation with domain registry operators, the ~~decrease~~Company inwill ~~cash~~seek ~~used~~to inbring ~~operating~~structure ~~activities~~to the emerging landscape of ~~$636~~domain extensions,~~412~~ ~~for~~while at the ~~first~~same ~~quarter~~time ofemphasizing ~~fiscal~~distribution ~~2020~~of isa ~~primarily~~unified ~~due~~mobile application to work as a ~~decrease~~digital ofcompanion ~~cash~~alongside ~~operating~~the ~~and~~growing network ~~administration~~of ~~expenses.~~direct navigation brands.

~~Net~~The DigitalTown cash received used in investing activities was $0 for the first quarter of fiscal 2020, compared to net cash provided by investing activities of $98,656 for the first quarter of fiscal 2019. In the first quarter of fiscal 2019, the Company received cash from the sale of certain digital currencies. Platform

~~Net~~The DigitalTown ~~cash~~platform ~~provided~~supports bypowerful ~~financing~~online ~~activities~~and ~~for~~mobile ~~the~~communities. ~~first~~We ~~quarter~~tap ofinto ~~fiscal~~locally ~~2020~~relevant ~~was~~news ~~$45,000,~~and ~~compared~~content in order to keep ~~$526,950~~community members informed. We provide community tools to keep community members connected. We enable commerce and fulfillment in ~~the~~local ~~first~~communities ~~quarter~~thereby ofhelping ~~fiscal~~residents ~~2019,~~to ~~which~~buy ~~consisted~~locally ~~mainly~~while ofequipping ~~borrowings~~merchants onto ~~convertible~~sell ~~notes.~~locally, nationally and even globally.

Monthly cash operating expenses for the first quarter of fiscal 2020, were approximately $40,000 per month. Based on current projections, the Company’s monthly cash operating expenses going forward should be approximately $40,000 per month. Content Search

WeThe DigitalTown ~~believe~~search ~~our~~engine ~~current~~serves ~~cash~~as ~~reserves,~~ the ~~amounts~~core weof ~~expect~~the ~~from~~local ~~future~~experience. ~~proceeds~~Whereas ~~from~~most ~~the~~residents ~~issuance~~may ofgo ~~our~~once ~~common~~or ~~stock~~twice ~~and~~per year to the ~~sale~~official ofcity ~~existing~~site, ~~domain~~the ~~names~~DigitalTown-powered ~~should~~search beengine ~~sufficient~~is todesigned ~~enable~~for usdaily touse ~~operate~~as ~~for~~a ~~the~~preferred ~~next~~homepage 12for ~~months~~local residents and businesses. InThis ~~the~~will ~~event~~be ~~that~~accomplished wethrough ~~are~~a ~~unable~~combination of marketing and education to ~~operate~~residents. ~~profitably~~In oraddition, ~~raise~~we ~~additional~~believe adoption ~~capital~~can happen through ~~the~~building ~~sale~~a strong level of ~~our~~trust ~~common~~with ~~stock~~the residents, wesince ~~would~~our platform will be ~~forced~~endorsed toor ~~further~~supported by ~~reduce~~the ~~operating~~local ~~expenses~~government orwhom ~~cease~~the ~~operations~~residents ~~altogether~~know. This compares to large national companies with limited to no connection to the local residents.

~~Off-Balance Sheet Arrangements~~ Community

WeConsumers are doalready ~~not~~familiar ~~have~~with ~~any~~social ~~off-balance~~networking ~~sheet~~through ~~arrangements~~applications like Facebook and Twitter. The integrated DigitalTown web service and mobile app make it easy to stay informed, as well as to connect and communicate with other members of a given community. Community members can message, join groups, shop online, and make payments.

~~Critical Accounting Policies~~ Commerce

~~Effective~~The DigitalTown ~~March~~platform 1,provides ~~2018,~~merchants ~~the Company adopted ASC 606 — Revenue from Contracts~~ with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a ~~customer;~~turn-key ~~(2)~~solution ~~identify~~for ~~the~~online ~~performance~~commerce. ~~obligations~~Once in the ~~contract;~~approved ~~(3)~~merchant ~~determine~~loads ~~the transaction price; (4) allocate the transaction price to each performance obligation in the contract;~~ SKU’s and ~~(5)~~inventory ~~recognize~~available ~~revenue~~for ~~when~~sale, ~~each performance obligation is satisfied. For~~ the ~~comparative~~merchants ~~periods,~~can ~~revenue~~begin ~~has~~selling ~~not~~without ~~been~~any ~~adjusted~~setup ~~and~~fees ~~continues~~or tocapital beinvestment ~~reported under ASC 605 — Revenue Recognition~~costs. ~~Under~~Transaction processing ~~ASC~~services ~~605, revenue is recognized when the following criteria~~ are ~~met:~~provided ~~(1)~~by ~~persuasive~~DigitalTown, ~~evidence~~thereby ofeliminating ~~an arrangement exists; (2)~~ the ~~performance~~need offor ~~service~~each ~~has~~retailer ~~been rendered~~ to secure a ~~customer~~merchant orprocessing account. ~~delivery~~The ~~has~~community ~~occurred;~~may ~~(3)~~also ~~the~~enable ~~amount of fee to be paid by~~ a ~~customer~~private iscurrency ~~fixed~~for ~~and~~use ~~determinable;~~within ~~and (4)~~ the ~~collectability of the fee is reasonably assured~~community.

~~There~~Courier and ~~was~~Delivery ~~no impact on the Company’s financial statements as a result of adopting Topic 606 for the first quarter of fiscal 2020 or the twelve months ended February 28, 2019.~~ Management

33In a ~~Table~~growing number of ~~Contents~~participating cities, an integrated courier and delivery application is included, enabling approved delivery service providers to be notified about items from merchants to be picked up and delivered to the customer, thereby enabling any approved merchant to also offer delivery services to the end-customer. Delivery time is chosen by the customer and can be hours to days.

The discussion and analysis of DigitalTown, Inc.’s financial condition and results of operations are based on our audited financial statements, which have been prepared in accordance with accounting principles generally accepted in the U.S. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities and expenses and related disclosure of contingent assets and liabilities. Management reviews its estimates on an ongoing basis. Management bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. While DigitalTown Inc.’s significant accounting policies are described in more detail in Note 1 to its financial statements, management believes the following accounting policies to be critical to the judgments and estimates used in the preparation of its financial statements: Administration

~~Prepaid~~The DigitalTown ~~Domain~~platform ~~Names~~provides integrated administrative tools for managing Content, Community and Commerce, making it easy to administer. The administrative tools are designed to be the back end of the smart community. For example, administrators can create Frequently Asked Questions (FAQ) that are then presented through the site search. This FAQ article is then systematically provided as information when a user makes an inquiry that matches the keywords into the search box on the site.

~~The annual domain name renewal fees are currently amortized over one year and the purchase of any new domain names are the only amounts capitalized. See Note 5 for further information.~~ Intellectual Property

~~Stock-Based~~Domain Name ~~Compensation~~Portfolio. The Company is developing a proprietary platform for Smart City Management. As part of this platform rollout, the Company has secured approximately 13,000 of the .CITY domains that map to significant population centers. DigitalTown has methodically secured the .CITY domains through both acquisition from existing registrants, or via direct purchase from the operator of the .CITY registrar.

The Company recognizes the cost of stock-based compensation plans and awards in operations on a straight-line basis over the respective vesting period of the awards. The Company measures and recognizes compensation expense for all stock-based payment awards made to employees, directors, consultants and advisors. The compensation expense for the Company's stock-based payments is based on estimated fair values at the time of the grant. 33

Software: The Company ~~estimates~~has ~~the~~developed ~~fair~~a ~~value~~proprietary ofplatform ~~stock-based~~for ~~payment~~enabling ~~awards~~any oncity ~~the~~to ~~date~~become ofa ~~grant~~Smart ~~using~~City, ~~the~~incorporating ~~Black-Scholes~~advanced ~~option~~features for ~~pricing~~economic ~~model~~development, community engagement and digital inclusion. ~~This~~In ~~option~~addition, ~~pricing~~the ~~model~~Company ~~involves~~has acompleted ~~number~~acquisitions of ~~assumptions~~7 software companies: Cloud.Market, ~~including~~Software ~~the~~Masters, ~~expected~~Inc, ~~lives~~Rezserve ofTechnologies ~~stock~~Ltd, ~~options~~Appointment.com, ~~the~~Comencia ~~volatility~~Inc, ofCongo ~~the~~Ltd. and ~~public~~CityInformation ~~market~~BV, ~~price~~each ~~for~~of ~~the~~which ~~Company's~~brought ~~common~~significant ~~stock~~intellectual property and ~~interest~~is ~~rates.~~in ~~Stock-based~~process ~~compensation~~of ~~expense~~being ~~recognized~~fully ~~during~~integrated into the ~~period~~DigitalTown isplatform. ~~based~~The onCompany ~~the~~continues ~~value~~to ofinvest ~~the~~in ~~portion~~software ofwith ~~stock-based~~an ~~payment~~emphasis ~~awards~~on ~~that~~capital ~~are~~efficiency ~~ultimately~~and ~~expected~~return toon ~~vest~~investment.

~~Recently Issued Accounting Pronouncements~~ Dispositions

~~Information~~In late ~~regarding~~fiscal ~~recently~~2019, ~~issued~~the ~~accounting~~Company ~~pronouncements~~sold isthe ~~included~~balance inof ~~Note~~its 1useful toassets, ~~the~~including ~~consolidated~~4 ~~financial~~of ~~statements~~the inabove-mentioned ~~“Item~~previously 1acquired -software companies ~~Financial~~that ~~Statements”~~had innot ~~this~~been ~~Quarterly~~integrated ~~Report~~into onthe ~~Form~~DigitalTown ~~10-Q~~platform. The Company is also no longer acquiring or renewing its domain name portfolio.

~~ITEM~~RESULTS OF ~~3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.~~OPERATIONS

~~The~~THREE MONTHS ~~Company~~ENDED ~~has~~AUGUST entered into stock purchase agreements with investors, and has accepted digital currencies as a form of payment from these investors, in exchange for shares of the Company’s common stock. Our primary market risk exposure with regard to digital currencies is the volatility in trading prices from day to day, which would only impact the gain/loss recognized at time of exchange on such instruments. As of May 31, 2019, ~~the~~AND ~~Company did not hold any digital currencies.~~ 2018

~~The~~During the ~~Company~~second ~~has~~quarter ~~not~~of ~~entered~~fiscal ~~into~~2020, ~~and~~the ~~does~~Company ~~not~~recorded ~~expect~~no ~~to enter into~~revenues, ~~financial~~cost ~~instruments~~of ~~for~~revenues, ~~trading~~ or ~~hedging~~gross ~~purposes.~~profit ~~The~~compared ~~Company~~to ~~does~~revenues ~~not~~of $20,047 ~~currently anticipate entering into interest rate swap~~ and~~/or~~ ~~similar~~cost ~~instruments.~~of ~~Our~~revenues ~~primary~~of ~~market risk exposure with regard to financial instruments is to changes in interest rates~~$114,937 ~~which~~for ~~would~~a ~~only~~gross ~~impact~~loss ~~interest income earned on such instruments. As~~ of ~~May 31~~$94,890 ~~2019,~~during the ~~Company~~second ~~did~~quarter ~~not~~of ~~have~~fiscal ~~any material currency exchange or interest rate risk exposure~~2019.

~~ITEM~~The Company’s 4operating expenses are currently all related to general and administrative activity. ~~CONTROLS~~These ~~AND~~expenses ~~PROCEDURES~~were $263,007 in the second quarter of fiscal 2020 compared to $1,511,914 in the second quarter of fiscal 2019, a decrease of $1,248,907. Our stock-based compensation expense was $134,000 for the second quarter of fiscal 2020 as compared to $639,496 for the second quarter of fiscal 2019, a decrease of $505,496.

~~Evaluation~~The Company’s loss from discontinued operations was $0 in the second quarter of ~~Disclosure~~fiscal ~~Controls~~2020, ~~and~~compared ~~Procedures~~to $71,453 in the second quarter of fiscal 2019, a decrease of $71,453.

~~Under~~The Company’s ~~the~~overall ~~supervision~~net ~~and~~loss ~~with~~from ~~the~~continuing ~~participation~~operations offor ~~our management, including our chief executive officer and chief financial officer, we conducted an evaluation of~~ the ~~effectiveness,~~current assecond ofquarter ~~May~~decreased ~~31,~~by ~~2019~~$2, ~~of our disclosure controls and procedures~~270,821 asto ~~defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934~~$390, ~~as amended (“Exchange Act”)~~242. The ~~purpose~~decrease ~~of this evaluation~~ was tomainly ~~determine~~due ~~whether as of the evaluation date our disclosure controls and procedures were effective~~ to ~~provide~~a ~~reasonable~~decrease ~~assurance that the information we are required to disclose~~ in ~~our~~stock ~~filings~~compensation ~~with the Securities and Exchange Commission (“SEC”)~~expense, ~~under~~a ~~the~~decrease ~~Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified~~ in ~~the~~debt ~~SEC’s rules~~ and ~~forms~~warrant ~~and~~discount ~~(ii) accumulated and communicated to our management~~amortization, a ~~including~~decrease our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure. Based on their evaluation, our management has concluded, as discussed below, that material weaknesses existed in ~~our~~prepaid ~~internal~~annual ~~control~~domain ~~over~~name ~~financial~~renewal ~~reporting as of May 31~~fees, ~~2019~~ and ~~as a result, our disclosures controls and procedures were not effective. Notwithstanding~~ the ~~material~~decrease ~~weaknesses that existed as of May 31, 2019, our chief executive officer and chief financial officer has concluded that the financial statements included~~ in ~~this~~general ~~Annual Report on Form 10-K present fairly, in all material aspects, the financial position, results of operations~~ and ~~cash~~administrative ~~flows of the Company in conformity with accounting principles generally accepted in the United States of America (“U~~expenses.~~S. GAAP”).~~

~~Changes~~SIX MONTHS inENDED ~~Internal~~AUGUST ~~Controls~~31, ~~over~~2019 ~~Financial~~AND ~~Reporting~~ 2018

~~Management continues to evaluate~~ During the ~~Company's~~first ~~internal~~six ~~controls~~months ~~over~~of ~~financial~~fiscal ~~reporting~~2020, ~~to ensure that~~ the ~~design~~Company ~~and~~recorded ~~implementation~~revenues of ~~corrective~~$50,000 ~~procedures~~and ~~are~~cost ~~adequate~~of torevenues ~~remediate~~of ~~the~~$306 ~~previously~~for ~~identified~~a ~~material~~gross ~~weaknesses~~profit of ~~from~~$49,694 ~~our~~compared ~~Form~~to ~~10-K~~revenues atof ~~February 28~~$41,972 ~~2019.~~and ~~Due~~cost toof ~~the~~revenues ~~small number~~ of ~~employees~~$521,989 ~~dealing~~for ~~with~~a ~~general~~gross ~~administrative~~loss ~~and~~of ~~financial~~$480,017 ~~matters~~during ~~and~~ the ~~expenses~~first ~~associated~~six months ~~with~~of ~~increases~~fiscal to2019. ~~remediate~~For the ~~disclosure~~first ~~controls~~six ~~and~~months ~~procedures~~of ~~that~~fiscal ~~have~~2020, ~~been~~revenues ~~identified,~~mainly ~~the~~consisted ~~Company~~of ~~continued~~development tofees. ~~operate~~Cost ~~without~~of ~~changes~~revenues consisted toof ~~its~~amortization ~~internal~~of ~~controls~~prepaid ~~over~~annual ~~financial~~domain ~~reporting~~name ~~for~~renewal ~~the~~fees ~~period~~of ~~covered~~$0 byand ~~this~~$302,989, ~~Quarterly~~development ~~Report~~expense onof ~~Form~~$0 ~~10-Q~~and ~~while~~$217,278, and ~~continuing~~merchant toprocessing ~~evaluate~~fees ~~and~~of ~~improve~~$306 toand ~~remediate~~$1,722, for the ~~material~~first ~~weaknesses~~six atmonths anof ~~appropriate~~fiscal ~~cost~~years ~~benefit~~2020 ~~basis.~~and 2019, respectively.

~~During~~The Company’s ~~the~~operating ~~fiscal~~expenses ~~quarter~~are ~~ended May~~currently ~~31,~~all ~~2019~~related to selling, ~~there~~general ~~was~~and noadministrative ~~change~~activity. These expenses were $605,381 in ~~our~~the ~~internal~~first ~~control~~six ~~over~~months ~~financial~~of ~~reporting~~fiscal ~~(as~~2020 ~~defined~~compared to $2,687,358 in ~~Rule~~the ~~13a-15(f)~~first ~~under~~six ~~the~~months ~~Exchange~~of ~~Act)~~fiscal ~~that~~2019, ~~has~~a ~~materially~~decrease ~~affected~~of $2,081,977. Our orstock-based iscompensation ~~reasonably~~expense ~~likely~~decreased by $797,975 to ~~materially~~$320,392 ~~affect~~for the first six months of fiscal 2020, ~~our~~as ~~internal~~compared ~~control~~to $1,118,367 ~~over~~for ~~financial~~the ~~reporting.~~first six months of fiscal 2019.

34The Company’s ~~Table~~loss from discontinued operations was $0 in the first six months of ~~Contents~~fiscal 2020, compared to $173,610 in the first six months of fiscal 2019, a decrease of $173,610.

~~PART~~The Company’s IIoverall net loss for the first six months of fiscal 2020 decreased by $4,039,849 to $948,809, as compared to the first six months of fiscal 2019. The decrease was mainly due to a decrease in stock compensation expense, a decrease in debt and warrant discount amortization, a decrease in prepaid annual domain name renewal fees, and the decrease in general and administrative expenses.

~~ITEM~~LIQUIDITY AND 1.CAPITAL ~~LEGAL PROCEEDINGS~~RESOURCES

~~DigitalTown~~The Company’s cash position at August 31, ~~Inc.~~2019 iswas $4,689, a decrease of $10,582 from ~~time~~$15,271 toat ~~time~~February 28, a2019. ~~party~~During tothe first ~~litigation~~six ~~arising~~months of fiscal 2020, net cash used in operating activities was $79,582 compared to net cash used of $1,540,094 for the ~~normal~~first ~~course~~six months of ~~its~~fiscal ~~business~~2019. ~~The~~When ~~Company~~comparing ~~believes~~the ~~that~~two ~~none~~periods, the decrease in net cash used in operating activities of $1,460,512 ~~these~~for ~~actions~~the ~~will~~first ~~have~~six amonths ~~material~~of ~~adverse~~fiscal ~~effect~~2020 onis ~~its~~primarily ~~financial~~due ~~condition~~to ora ~~results~~decrease of ~~operations.~~cash operating expenses.

~~ITEM 1A. RISK FACTORS~~34

~~The~~Net cash ~~most~~provided ~~significant~~by ~~risk~~investing ~~factors~~activities ~~applicable~~was to$0 ~~the~~and ~~Company are described in Part I~~$718,181 ~~Item~~for 1Afirst ~~"Risk~~six ~~Factors"~~months of ~~our~~fiscal ~~Annual~~years ~~Report~~2020 onand ~~Form~~2019, ~~10-K~~respectively. ~~for~~ In the ~~year~~second ~~ended~~quarter ~~February~~of ~~28,~~fiscal 2019., ~~There~~the ~~have~~Company ~~been~~received nocash ~~material changes~~ from the ~~risk~~sale ~~factors~~of ~~previously~~digital ~~disclosed in our Annual Report on Form 10-K~~currencies.

~~ITEM~~Net cash 2.provided ~~UNREGISTERED~~by ~~SALES~~financing OFactivities ~~EQUITY~~for ~~SECURITIES~~the ~~AND~~first ~~USE~~quarter OFof ~~PROCEEDS~~fiscal 2020 was $70,000, compared to $796,359 in the first quarter of fiscal 2019, which consisted mainly of borrowings on convertible notes.

~~During~~Monthly cash operating expenses for the first quarter of fiscal ~~2019~~2020, were approximately $40,000 per month. Based on current projections, the Company’s ~~did~~monthly ~~not~~cash ~~enter~~operating ~~into~~expenses ~~any~~going ~~stock~~forward ~~purchase~~should ~~agreements.~~be approximately $40,000 per month.

~~ITEM~~We believe 3our current cash reserves, the amounts we expect from future proceeds from the issuance of our common stock and the sale of existing domain names should be sufficient to enable us to operate for the next 12 months. ~~DEFAULTS~~In ~~UPON~~the ~~SENIOR~~event ~~SECURITIES~~that we are unable to operate profitably or raise additional capital through the sale of our common stock, we would be forced to further reduce operating expenses or cease operations altogether.

~~None.~~Off-Balance Sheet Arrangements

~~ITEM~~We do 4.not ~~MINE~~have ~~SAFETY~~any ~~DISCLOSURES~~off-balance sheet arrangements.

~~Not~~Critical Accounting ~~applicable.~~Policies

~~ITEM~~Effective March 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. ~~OTHER~~For ~~INFORMATION~~the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. There was no impact on the Company’s financial statements as a result of adopting Topic 606 for the first quarter of fiscal 2020 or the twelve months ended February 28, 2019.

	(a)	All information required to be disclosed on a report on Form 8-K during the period ended May 31, 2018, has previously been reported.
	(b)	There have been no material changes to the procedures by which security holders may recommend nominees to the registrant's board of directors.

35Prepaid Domain ~~Table of Contents~~Names

~~ITEM~~The annual 6domain name renewal fees are currently amortized over one year and the purchase of any new domain names are the only amounts capitalized. ~~EXHIBITS~~See Note 5 for further information.

Exhibit 31.1		Certification pursuant to 18 U.S.C. Section 1350 Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Executive Officer
Exhibit 31.2		Certification pursuant to 18 U.S.C. Section 1350 Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Financial Officer
Exhibit 32.1		Certification pursuant to 18 U.S.C. Section 1350 Section 906 of the Sarbanes-Oxley Act of 2002 - Chief Executive Officer
Exhibit 32.2		Certification pursuant to 18 U.S.C. Section 1350 Section 906 of the Sarbanes-Oxley Act of 2002 - 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 Labels Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

Stock-Based Compensation

36The Company ~~Table~~recognizes the cost of ~~Contents~~stock-based compensation plans and awards in operations on a straight-line basis over the respective vesting period of the awards. The Company measures and recognizes compensation expense for all stock-based payment awards made to employees, directors, consultants and advisors. The compensation expense for the Company’s stock-based payments is based on estimated fair values at the time of the grant.

~~SIGNATURES~~The Company estimates the fair value of stock-based payment awards on the date of grant using the Black-Scholes option pricing model. This option pricing model involves a number of assumptions, including the expected lives of stock options, the volatility of the public market price for the Company’s common stock and interest rates. Stock-based compensation expense recognized during the period is based on the value of the portion of stock-based payment awards that are ultimately expected to vest.

Pursuant to the requirements of Section 13 or 15(d) 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. 35

	DigitalTown, Inc.
Dated: August 22, 2019	By:	/s/ Sam Ciacco
		Sam Ciacco
		Chief Executive Officer and Chairman
		(Principal Executive Officer)

Recently Issued Accounting Pronouncements

~~Pursuant~~Information regarding torecently ~~the~~issued ~~requirements~~accounting ofpronouncements ~~the~~is ~~Securities~~included ~~Exchange~~in ~~Act~~Note of1 ~~1934,~~to ~~this report has been signed below by~~ the ~~following~~consolidated ~~persons~~financial onstatements ~~behalf~~in of“Item 1 ~~the~~- ~~Company~~Financial ~~and~~Statements” in ~~the~~this ~~capacities~~Quarterly ~~and~~Report on ~~the~~Form ~~dates indicated~~10-Q.

Dated: August 22, 2019	By:	/s/ Sam Ciacco
		Sam Ciacco
		Chief Executive Officer and Chairman (Principal Executive Officer)

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Dated: August 22, 2019	By:	/s/ Kevin Wilson
		Kevin Wilson
		Chief Financial Officer (Principal Financial Officer)

The Company has entered into stock purchase agreements with investors, and has accepted digital currencies as a form of payment from these investors, in exchange for shares of the Company’s common stock. Our primary market risk exposure with regard to digital currencies is the volatility in trading prices from day to day, which would only impact the gain/loss recognized at time of exchange on such instruments. As of August 31, 2019, the Company did not hold any digital currencies.

37The Company has not entered into, and does not expect to enter into, financial instruments for trading or hedging purposes. The Company does not currently anticipate entering into interest rate swap and/or similar instruments. Our primary market risk exposure with regard to financial instruments is to changes in interest rates, which would only impact interest income earned on such instruments. As of August 31, 2019, the Company did not have any material currency exchange or interest rate risk exposure.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, we conducted an evaluation of the effectiveness, as of August 31, 2019, of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”). The purpose of this evaluation was to determine whether as of the evaluation date our disclosure controls and procedures were effective to provide reasonable assurance that the information we are required to disclose in our filings with the Securities and Exchange Commission (“SEC”), under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure. Based on their evaluation, our management has concluded, as discussed below, that material weaknesses existed in our internal control over financial reporting as of August 31, 2019 and as a result, our disclosures controls and procedures were not effective. Notwithstanding the material weaknesses that existed as of August 31, 2019, our chief executive officer and chief financial officer has concluded that the financial statements included in this Annual Report on Form 10-K present fairly, in all material aspects, the financial position, results of operations and cash flows of the Company in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Changes in Internal Controls over Financial Reporting

Management continues to evaluate the Company’s internal controls over financial reporting to ensure that the design and implementation of corrective procedures are adequate to remediate the previously identified material weaknesses from our Form 10-K at February 28, 2019. Due to the small number of employees dealing with general administrative and financial matters and the expenses associated with increases to remediate the disclosure controls and procedures that have been identified, the Company continued to operate without changes to its internal controls over financial reporting for the period covered by this Quarterly Report on Form 10-Q while continuing to evaluate and improve to remediate the material weaknesses at an appropriate cost benefit basis.

During the fiscal quarter ended August 31, 2019, there was no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

ITEM 1. LEGAL PROCEEDINGS

DigitalTown, Inc. is, from time to time, a party to litigation arising in the normal course of its business. The Company believes that none of these actions will have a material adverse effect on its financial condition or results of operations.

ITEM 1A. RISK FACTORS

The most significant risk factors applicable to the Company are described in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended February 28, 2019. There have been no material changes from the risk factors previously disclosed in our Annual Report on Form 10-K.

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

Please see the following Notes to our unaudited financial statements included in this Quarterly Report on Form 10-Q for details on our issuances of unregistered shares of equity securities during the six months ended August 31, 2019. We issued shares of our common stock pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, as transactions not involving a public offering.

Note 6. Accrued Expenses and Deferred Revenue (Deferred Revenue); Note 7. Stockholders’ Equity (Fiscal 2020 Stock Transactions); Note 9. Related Party Transactions (Convertible Notes Payable – Related Party); Note 9. Related Party Transactions (Promissory Notes Payable - Related Party); Note 9. Related Party Transactions (Sales of Common Stock); Note 17. Subsequent Events (Note Conversions); and Note 17. Subsequent Events (Stock Transactions).

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

	(a)	All information required to be disclosed on a report on Form 8-K during the period ended May 31, 2018, has previously been reported.

	(b)	There have been no material changes to the procedures by which security holders may recommend nominees to the registrant’s board of directors.

ITEM 6. EXHIBITS

Exhibit 3.1		Certificate of Amendment dated June 14, 2019 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on June 17, 2019)
Exhibit 31.1		Certification pursuant to 18 U.S.C. Section 1350 Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Executive Officer*
Exhibit 31.2		Certification pursuant to 18 U.S.C. Section 1350 Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Financial Officer*
Exhibit 32.1		Certification pursuant to 18 U.S.C. Section 1350 Section 906 of the Sarbanes-Oxley Act of 2002 - Chief Executive Officer+
Exhibit 32.2		Certification pursuant to 18 U.S.C. Section 1350 Section 906 of the Sarbanes-Oxley Act of 2002 - 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 Labels Linkbase Document*
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document*

* Filed herewith

+ In accordance with SEC Release 33-8238, Exhibits 32.1 and 32.2 are being furnished and not filed.

SIGNATURES

	DigitalTown, Inc.

Dated: December 2, 2019	By:	*/s/ Sam Ciacco*
		Sam Ciacco
		Chief Executive Officer and Chairman
		(Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Company and in the capacities and on the dates indicated.

Dated: December 2, 2019	By:	*/s/ Sam Ciacco*
		Sam Ciacco
		Chief Executive Officer and Chairman
		(Principal Executive Officer)

Dated: December 2, 2019	By:	*/s/ Kevin Wilson*
		Kevin Wilson Chief Financial Officer
		(Principal Financial Officer)

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