UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

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

For the fiscal year ended March 31, ~~2020~~2021

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

For the transition period from April 1, ~~2019~~2020 to March 31, ~~2020~~2021

Commission File Number: 000-53723

TAURIGA SCIENCES, INC.

(Exact name of registrant as specified in its charter)

Florida		30-0791746
(State or other jurisdiction of		(IRS Employee
incorporation or organization)		Identification No.)

555 Madison Avenue, 5th Floor
4 Nancy Court Suite #4
New York, NY		10022
Wappingers Falls, NY		12590
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (917) 796-9926

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

None

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

Common Stock, $0.00001 Par Value

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. [ ] Yes [X] No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. [ ] Yes [X] No

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

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

Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [ ] Smaller reporting company [X] (Do not check if smaller reporting company) Emerging growth company [ X ]

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

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

On September 30, ~~2019~~2020, the last business day of the registrant’s most recently completed second quarter, the aggregate market value of the Common Stock held by non-affiliates of the registrant was $25,~~883~~660,~~284~~617 based upon the closing price on that date of the Common Stock of the registrant on the OTC Bulletin Board system of $0.~~0401~~0324. For purposes of this response, the registrant has assumed that its directors, executive officers and beneficial owners of 5% or more of its Common Stock are deemed affiliates of the registrant.

As of as of June 26, ~~2020~~2021, the registrant had ~~145~~285,~~323~~696,~~728~~214 shares of its Common Stock, $0.00001 par value (the “Common Stock”), outstanding.

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

Title of each class		Trading Symbol		Name of each exchange on which registered
Common Stock, par value $0.0001 per share		TAUG		OTCQB

TABLE OF CONTENTS

		Page
PART I.
Item 1.	Business	4
Item 1.A.	Risk Factors	1418
Item 1.B.	Unresolved Staff Comments	3037
Item 2.	Properties	3037
Item 3.	Legal Proceedings	3037
Item 4.	Mine Safety Disclosures	3037
PART II.
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	3138
Item 6.	Selected Financial Data	3441
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operation	3441
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	4348
Item 8.	Financial Statements and Supplementary Data	4349
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	4450
Item 9A.	Controls and Procedures	4450
Item 9B.	Other Information	4551
PART III.
Item 10.	Directors, Executive Officers and Corporate Governance	4652
Item 11.	Executive Compensation	4956
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	4957
Item 13.	Certain Relationships and Related Transactions, and Director Independence	5058
Item 14.	Principal Accounting Fees and Services	5058
PART IV.
Item 15.	Exhibits, Financial Statement Schedules	5059
	Signatures	5461
	Exhibits

FORWARD LOOKING STATEMENTS

This annual report on Form 10-K contains “forward-looking statements” within the meaning of Section 27A of the Securities ~~Act~~ Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our industry, our beliefs and our assumptions. Forward looking statements are often identified by words such as “will”, “may”, “projects”, “anticipate,” “expects,” “intends,” “plans,” “believes,” “seeks” and “estimates” and variations of these words and similar expressions or import are intended to identify forward-looking statements, but are not intended to constitute the exclusive means of identifying such statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, including those described in “Risk Factors” contained below in this annual report, some of which are beyond our control and difficult to predict and could cause actual results, performance or achievements, or industry results to differ materially from any future results, performance or achievements, expressed or implied, by such forward-looking statements. You should not place undue reliance on these forward-looking statements, which apply only as of the date of this Form 10-K. Investors should carefully consider all of such risks before making an investment decision with respect to the Company’s stock. The following discussion and analysis should be read in conjunction with our consolidated financial statements for Tauriga Sciences, Inc. Such discussion represents only the best present assessment from our Management.

All references in this Annual Report on Form 10-K to “we,” “us,” “our” and the “Company” refer to Tauriga Sciences, Inc., a Florida corporation, and its consolidated subsidiaries unless the context requires otherwise.

PART I

ITEM 1. BUSINESS

General Overview

Tauriga Sciences, Inc. (the “Company”) is a Florida corporation, with its principal place of business being located at ~~555 Madison~~4 ~~Avenue,~~Nancy ~~Fifth Floor~~Court Suite#4, ~~New~~Wappingers ~~York~~Falls, NY ~~10022~~12590. The Company has, over time, moved into that of a diversified life sciences technology company, with its mission to operate a revenue generating business, while continuing to evaluate potential acquisition candidates operating in the life sciences technology space.

Tauriga Pharma Corp.

On January 4, 2018, the Company announced the formation of a wholly- owned subsidiary in Delaware. ~~This subsidiary, incorporated in Delaware, was~~ initially named Tauriga IP Acquisition Corp., which changed its name to Tauriga Biz Dev Corp. on March 25, 2018~~, and most recently (January 2020) changed its name to Tauriga Pharma Corp~~.

Effective January 2020, the Company amended the certificate of incorporation of Tauriga Business Development Corp. in relevant part to effectuate a name change of this subsidiary to Tauriga Pharma Corp. The principal reason for the name change is to ~~align~~concentrate this subsidiary’s focus on the development of a pharmaceutical product line that is synergistic with the Company’s primary CBD product line. Currently, the plan is to initially create a pharmaceutical line of products to address nausea symptoms related to chemotherapy treatment in patients, which we will submit for clinical trials and to regulatory agencies for approval.

On March 18, 2020, the Company filed a Provisional U.S. Patent Application covering its Pharmaceutical grade version of Tauri-Gum™. This patent application, filed with the United States Patent & Trademark Office (“U.S.P.T.O.”), is titled: “MEDICATED CBD COMPOSITIONS, METHODS OF MANUFACTURING, AND METHODS OF TREATMENT.” The Company’s proposed ~~Pharmaceutical~~pharmaceutical grade ~~version~~ version of Tauri-Gum™ is being developed for nausea regulation, intended specifically to target patients subjected to ongoing ~~chemotherapy~~ chemotherapy treatment(s) (the “Indication”). The delivery system for this ~~Pharmaceutical~~pharmaceutical product is an improved version of the existing “Tauri-Gum™” chewing gum formulation based on continued research and development.

Currently the pharmaceutical grade version of Tauri-Gum is in the pre-IND stage of development. The development team is working on several parallel workstreams, including:

●	formulation development;

●	non-clinical in vivo and in vitro studies to inform the effective clinical dose and safety margin;

●	regulatory strategy and regulatory documentation preparation;

●	confirmation of the active pharmaceutical ingredient (API); and

●	Identifying pharma-grade API suppliers.

Tauriga Sciences Limited

On June 10, 2019, the Company formed a wholly owned subsidiary, Tauriga Sciences Limited, with the ~~registrar~~Registrar of Companies for Northern Ireland. Tauriga Sciences Limited is a private limited Company. The entity was established in conjunction with e-commerce merchant services. In conjunction to this new entity, the Company entered into a two-year lease commencing on June 11, 2019 ~~and expiring on June 30, 2021~~. The office is located at Regus World Trade Centre Muelle de Barcelona, edif. Sur, 2a Planta Barcelona Cataluña 08039 Spain. The Company terminated this lease during October 2020. The Company no longer maintains an office in this region.

Collaboration Agreement with Aegea Biotechnologies Inc.

On April 3, 2020, Tauriga Sciences, Inc. entered into a collaboration agreement (“Collaboration Agreement”) with Aegea Biotechnologies Inc. (“Aegea”), for the purpose of developing a Rapid, Multiplexed Novel Coronavirus (COVID-19) Point of Care Test with Superior Sensitivity and Selectivity (the “SARS-Col 2 Test”). The parties ~~believe~~believed that the benefits of the SARS-CoV-2 Test ~~are~~were ~~as follows:~~the following: a Rapid SARS-CoV-2 test with the sensitivity and specificity to eliminate false negatives and false positives, and with the ~~ability~~ ability to detect and measure viral shed, even in patients who are asymptomatic. This SARS-CoV-2 test would use Aegea’s patented technologies, to take coronavirus testing to the next level by differentiating different strains of SARS-CoV-2. The test, if successful, would be adaptable to additional SARS-CoV-2 strain types as necessary and as the virus mutates. It also has the possibility to be ~~rapidly~~ be rapidly customized to provide similarly sensitive and specific assays for other viruses. The Company ~~has~~ committed to raise funding for the purposes set forth in under the Collaboration Agreement from its $5,000,000 Equity Line of Credit (“ELOC”). with Tangiers Global, LLC, which became effective on March 16, 2020. Seventy percent (70%) of the net proceeds from the sale of the initial 10,000,000 shares of stock ~~our~~of ~~Common~~Tauriga ~~Stock~~ under the ELOC ~~will~~were be invested in Aegea for the development of the Covid Test and used to purchase shares of common stock of Aegea, at a purchase price of $4.00 per share. AsThe of$4.00 ~~the~~stock ~~date~~price corresponds to a current pre-money valuation of ~~this~~Aegea ~~annual~~of ~~report~~$25,000,000 for ~~the~~each ~~Company~~tranche ~~has~~of ~~contributed~~cash, aup ~~total~~to ofthe first $~~183~~2,~~442~~000,000 ~~towards~~of ~~this~~our ~~collaboration~~investment ~~agreement~~in Aegea. Additionally, aas ~~portion~~part of ~~which~~our ~~was~~agreement ~~funded~~with ~~through~~Aegea, ~~the~~on May ~~sale~~26, of2020, ~~our~~Tauriga ~~Common~~issued ~~Stock~~to ~~under~~Aegea ~~our~~5,000,000 ~~existing~~unregistered ~~ELOC~~common shares of Tauriga common stock. On August 10, 2020, the Company and ~~See~~Aegea ~~also~~amended their Collaboration Agreement. Under the ~~description~~terms of ~~our~~the ~~investments~~amendment, inhaving invested 70% of the ~~Notes~~proceeds tofrom ~~our~~the ~~financial~~sale ~~statements~~of inthe initial ~~Note~~10,000,000 12shares -of ~~Investments~~Tauriga ~~and~~stock ~~Note~~under 15the ~~– Subsequent~~ELOC ~~Events~~with Tangiers, asthe ~~well~~Company asincreased the percentage of proceeds it invested in ~~agreements~~Aegea ~~filed~~on bythe ussale asof ~~exhibits~~the toremaining orshares ~~incorporated~~available byunder ~~reference~~the inELOC ~~this~~agreement ~~annual~~from ~~report~~20% to 40%.

~~Pursuant~~On toJanuary ~~the~~6, ~~amended~~2021, ~~terms of the Collaboration Agreement~~however, ~~following~~ the ~~initial~~Company ~~sale~~determined ofto ~~10,000,000~~terminate ~~shares~~its ~~of our common stock under the~~ ELOC, ~~twenty~~by ~~percent~~terminating ~~(20%)~~each of ~~all~~the ~~subsequent~~Investment ~~net~~Agreement ~~proceeds~~and ~~from~~Registration Rights ~~the~~Agreement, ~~sale~~and ofon ~~shares~~January ~~under~~8, ~~the~~2021 ~~ELOC~~filed ~~shall~~a bePost-Effective ~~used~~Amendment to ~~purchase additional~~its ~~shares~~Form ofS-1 ~~common~~Registration ~~stock~~Statement of(333-236923) ~~Aegea~~which atremoved from aregistration ~~purchase~~all ~~price~~shares ofnot ~~$4.00~~previously ~~per~~sold ~~share~~thereunder. ~~The~~This ~~$4.00~~effectively ~~stock~~also ~~price~~eliminates ~~corresponds~~our obligation to aany ~~current~~additional funding ~~pre-money~~to ~~valuation of~~ Aegea ofunder ~~$25,000,000~~the ~~for~~Collaboration ~~each~~Agreement. ~~tranche~~As of ~~cash~~March 31, up2021, to the ~~first~~Company had invested $2278,~~000,000~~212 ~~of our investment~~ in Aegea. ~~The valuation~~for ~~will~~69,553 beshares, ~~reassessed~~representing an ~~and~~ownership ~~reset~~percentage byof ~~the~~1.03%. ~~parties~~As ~~after~~of ~~the~~March ~~first~~31, $22021,~~000,000~~ resultant delays of ~~Tauriga’s~~project ~~investment~~milestones ishave ~~received~~led ~~by Aegea.~~the InCompany ~~addition,~~to asdetermined ~~part~~that full recovery of ~~our~~its ~~agreement~~investment ~~with~~in Aegea, Onis ~~May~~in ~~26,~~doubt ~~2020,~~and ~~Tauriga~~has ~~also~~recorded ~~issued~~a to50% ~~Aegea~~impairment ~~5,000,000~~loss ~~unregistered common~~on ~~shares~~its ofconsolidated ~~Tauriga~~Statement ~~common~~of ~~stock.~~Operations in ~~The~~the ~~Collaboration~~amount ~~Agreement~~of ~~commenced~~$139,106. onAegea ~~signing~~is ~~and~~still ~~will~~moving ~~continue~~forward ~~indefinitely,~~on ~~unless amended~~this orproject ~~terminated~~and bythe ~~mutual~~Company ~~written~~will ~~agreement~~continue ofto monitor the ~~parties~~progress.

On February 26, 2021, as part of a settlement agreement concluding the Collaboration Agreement, the Company acquired an additional 69,552 common shares of Aegea, increasing the Company’s total holdings to 139,104 Aegea shares (representing a 2.04% stake in Aegea as of March 31, 2021).

Chief Medical Officer

On July 15, 2020, the Company appointed Dr. Keith Aqua (“Dr. Aqua”) as an independent contractor to the position of Chief Medical Officer (“CMO”) and entered into a consulting agreement with Dr. Aqua which carries a term of 12 months from inception, expiring on July 15, 2021. In his CMO capacity, Dr. Aqua will help the Company progress in the development of the Company’s proposed pharmaceutical grade version of Tauri-Gum™. In addition, Dr. Aqua will help establish a distribution network for the Company to market its Tauri-Gum™ brand to a variety of physicians and medical practices in southern Florida. In consideration of the services being provided by Dr. Aqua, and pursuant to the terms of the Agreement, the Company has agreed to issue Dr. Aqua (i) upon entry into the Agreement 750,000 shares of restricted common stock, (ii) agreed to 750,000 shares of restricted common stock which will be issued in equal monthly instalments of 62,500 shares beginning August 15, 2020 and (iii) agreed to $4,000 cash per quarter during the term of the Agreement, payable following the completion of each such quarter. As of March 31, 2021, the Company issued 1,187,500 restricted shares of its common stock to Dr. Aqua valued at $46,906 ($0.0395 per share). Subsequent to March 31, 2021, Dr. Aqua was issued 187,500 restricted shares of its common stock valued at $7,406 ($0.0395 per share).

Master Services Agreement

On December 16, 2020, we entered into a Master Services Agreement with North Carolina based Clinical Strategies & Tactics, Inc. (“CSTI”) to resume the clinical development of its proposed anti-nausea pharmaceutical grade version of Tauri-Gum™. CSTI will primarily focus its efforts on (i) Pharmaceutical Development Strategy, (ii) Commercialization Strategy, and (iii) Funding Strategy. The Company will with work with CSTI’s founder and chief executive officer, JoAnn C. Giannone, who has over 25 years’ experience effectively leading companies through the drug and medical device development process. On December 23, 2020, the Company funded the costs associated with this Agreement, which total consulting fees were $67,500, exclusive of out-of-pocket reimbursable expenses. The Company has paid additional fees, effected through change orders to the original contract, in the amount of $85,000. These additional fees were for pharmaceutical testing and market research. Under the terms of the Agreement and related statement of work, CTSI will provide a high-level assessment and documentation of the development efforts required to commercialize the proposed pharmaceutical product globally, a commercial assessment, and a review of potential funding strategies and funding sources and potential business partners. The delivery system for this proposed pharmaceutical version is a modified version (with higher concentration of CBD) of the existing Tauri-Gum™” chewing gum formulation based on continued research and development.

COMPANY PRODUCTS

~~TAURI~~Tauri-~~GUMTM~~GumTM

To begin this process, during the quarter ended December 31, 2018, the Company began discussions with a Maryland based chewing gum manufacturer - Per Os Biosciences LLC (“Per Os Bio”), which consummated in a manufacturing agreement in late December 2018 to launch and bring to market a white label line of CBD infused chewing gum under the brand name Tauri-Gum^TM. In October 2019, we filed trademark applications for the above-referenced marks in each of the European Union and Canada. On February 18, 2020, the Company received a notice of allowance from the European Union Intellectual Property Office granting the Company its trademark registration for Tauri-Gum™ (E.U. Trademark # 018138334).

Under the terms of the agreement, Per Os Bio produces Tauri-Gum^TM based on the following criteria:

A. By composition, the CBD Gum will contain 10 mg of CBD ~~Isolate~~isolate;

B. The initial production run will be mint flavor;

C. This proprietary CBD Gum will be manufactured under U.S. Patent # 9,744,128 (“Method for manufacturing medicated chewing gum without cooling”);

D. Each Production Batch, including the initial production run, is estimated to yield 70,000 gum tablets or 8,700 Units (each Unit contains 8 gum tablets);

E. Integrated Quality Control Procedures: Each production batch will be tested by a 3rd Party for CBD label content, THC content (0%), and clear for microbiology;

F. The packaging, for retail marketplace, will consist of 8 count (gum tablet count) blister card labeled (the “~~Pack~~pack(s)”) with ~~Lot~~lot # as well as ~~Expiration~~expiration ~~Date~~date;

G. Outer sleeve in the Company’s artwork and graphic design(s) and label copy; and

H. Shipping System: ~~Bulk~~bulk packed 266 Packs per master case (“~~Palletized~~palletized”).

Under terms of the agreement with Per Os Bio:

A. Each product order will consist of 8,700 Packs (unless otherwise agreed upon by both parties); B. ½ of initial production invoice due within 3 days of execution of ~~Manufacturing~~manufacturing ~~Agreement~~agreement; C. Provide graphic design artwork, logo, and label design to Per Os Bio; D. To implement kosher certification process; E. Procure appropriate ~~Product~~product & ~~Liability~~liability insurance policy; and F. Acquire legal opinion with respect to the confirmation of the legality to sell this CBD Gum on the Federal Statute Level.

The Company’s gum formulation includes distinctive features: allergen free, gluten free, vegan, kosher (K-Star certification), Halal (Etimad certification), Vegan Formulation and incorporates a proprietary manufacturing process. See our “Risk Factors” contained in this Annual Report, including with respect, but not limited, to Federal laws and regulations that govern CBD and cannabis.

The Company’s E-commerce website is www.taurigum.com.

During the fiscal year 2020, the Company added two additional flavors. Blood Orange and Pomegranate.

5On August 31, 2020, the Company announced that it has obtained HALAL certification (Authority: Etimad) for the entirety of its flagship brand Tauri-Gum™. A HALAL certification is a guarantee that the products comply with the Islamic dietary requirements or Islamic lifestyle.

~~TAURI~~During the year ended March 31, 2021, the Company received and commenced sales of Peach-~~GUMMIES™~~Lemon and Black Currant CBG Gum.

During its 4th Fiscal Quarter of 2021, the Company made a strategic decision to enhance its original Tauri-Gum™ formulation, by increasing the infusion concentrations of both its Cannabidiol (“CBD”) and Cannabigerol (“CBG”) Tauri-Gum™ products to 25mg per piece of chewing gum (previous concentration was 10mg for the Pomegranate, Blood Orange, Mint, and Peach-Lemon flavors and 15mg for the Black Currant flavor). Additionally, the Company increased its Tauri-Gum™ product offerings to 9 SKUs. The new offerings being introduced are Cherry-Lime Rickey flavored Caffeine infused chewing gum, an 8-piece blister pack of containing 50mg of caffeine per piece and Golden Raspberry flavored Vitamin D3 infused chewing gum, containing 2,000 IU (50 micrograms) of Vitamin D3 per piece. Through its October 2020 partnership with Think Big LLC (the Company founded by the son of late iconic U.S. rap artist, NOTORIOUS BIG aka “Frank White”), the Company is also offering 2 limited edition Licensed Tauri-Gum™/Frank White products: Honey-Lemon flavored chewing gum (containing: 15mg CBD, 15mg CBG, 5mg Vitamin C, 10mg Zinc per piece) and Mint flavor (25mg CBD per piece). For a full list of our currently available products please visit our E-Commerce Website at https://taurigum.com/.

Tauri-Gummies™

On November 25, 2019, the Company announced that it has finalized the formulation for its Vegan 25 mg CBD (Isolate) Infused Gummies product to be branded Tauri-Gummies™ for which a trademark was filed in Switzerland and the European Union. This product contains no gelatin in the formulation, as the Company has utilized plant-based alternatives in completion of this product. There will be 4 flavors offered – cherry, orange, lemon and lime.

Each gummy package contains 24 gummies in a jar, 6 of each flavor, containing 25mg of CBD isolate per individual gummy, or 600 mg of CBD isolate per jar. These gum drops have been manufactured in the “Nostalgic” 1950s confectionary style and are both plant-based (vegan formulated) and kosher certified. The Company commenced sales of Tauri-Gummies™ in January 2020.

~~CANNABIGEROL~~In ~~“CBG”~~addition, ~~ISOLATE~~we ~~INFUSED~~also ~~VERSION~~received OFa ~~TAURI~~Notice of Allowance to our Tauri-~~GUM™~~GummiesTM registered trademark application from the European Union Intellectual Property Office. The trademark application was registered on June 24, 2020, under Serial No. 018138351, which extends our protective period for this mark until October 2029, and which may be extended thereafter for ten-year intervals.

Cannabigerol “CBG” Isolate Infused Version of Tauri-Gum™

On December 30, 2019, the Company announced it had commenced development of a Cannabigerol (“CBG”) Isolate Infused version of its Tauri-Gum™ brand. This initial production run had been completed in its Peach-Lemon flavor (and each piece of Chewing Gum contains 10mg CBG isolate). This initial production run yielded roughly 8,300 blister packs. The product is Kosher Certified, Vegan Formulated, Lab Tested, NON-GMO, Allergen Free, Gluten Free, containing no THC, and 100% Made in the USA. MSRP has been established at $19.99 per Blister Pack.

The Company has also commenced production of its second version of CBG Infused Tauri-Gum - Black Currant Flavor (each piece of Chewing ~~Gum~~ Gum contains 15mg of CBG isolate). The Company’s Black Currant Flavor - CBG Infused Tauri-Gum™~~, will be~~: Kosher Certified, Vegan, Halal, Lab-Tested, NON-GMO, Allergen Free, Gluten Free, 15mg CBG/Piece of Chewing Gum, 100% Made in the USA. ~~MSRP will be $22.99 per Blister Pack.~~

During the year ended March 31, 2021, the Company received and commenced sales of Peach-Lemon and Black Currant CBG Gum.

Immune Booster Version of Tauri-Gum™

On May 29, 2020, the Company announced that it has commenced development of an Immune Booster version of Tauri-Gum™, which commenced sales during the three months ended September 30, 2020. This product contains 60mg of Vitamin C and 10mg of Elemental Zinc (“Zinc”) in each piece of chewing gum. This product does not contain any phytocannabinoids (i.e., CBD or CBG). The Company’s Immune Booster Tauri-Gum™ product, is: Kosher certified, Halal Vegan, Lab-Tested, non-GMO, allergen free, gluten free, infused with 60mg Vitamin C & 10mg Elemental Zinc/per each piece of gum, no phytocannabinoids, and 100% made in the United States of America. This product was developed for general usage and as with respect to the entirety of the Company’s retail Tauri-Gum™ product line, there are no “treatment claims” made.

Rainbow Deluxe Sampler Pack

On June 15, 2020, the Company, introduced its Rainbow Deluxe Sampler Pack (“Rainbow Pack”). The Rainbow Pack is comprised of one blister pack of each Tauri-Gum’s™ flavors (6 blister packs in total) and will be available exclusively on the Company’s E-Commerce website (www.taurigum.com). The Rainbow Pack is comprised of three Tauri-Gum™ flavors of Cannabidiol (“CBD”) infused (Mint, Blood Orange, Pomegranate), two of the Tauri-Gum™ flavors are Cannabigerol (“CBG”) infused (Peach-Lemon, Black Currant), and one Tauri-Gum™ flavor is Vitamin C + Zinc (“Immune Booster”) infused (Pear Bellini). The introductory price of the Rainbow Pack is $99.99 per pack. The Rainbow pack commercially launched in late September 2020.

Other Products

The Company, from time to time, will offer various formats of CBD product through its e-commerce website. As of this report date the Company is currently offering a 70% dark chocolate 20mg CBD non-GMO dietary supplement and 100mg CBD scented bath bombs (Mint, Pomegranate and Blood Orange). The Company’s current offering includes a line of skin care products sold on its ecommerce website under the product line name of Uncle Bud’s. The skin care products include three different 4.2mg CBD facemasks (collagen, detoxifying and tightening masks), 100mg CBD daily moisturizer, 30mg CBD anti-wrinkle dream, hand and foot cream with hemp seed oil, 120mg CBD massage and body oil, 240mg CBD body revive roll-on, 35mg CBD transdermal patch and 120mg CBD body spray. Additionally, on December 1, 2020, the Company announced the commencement of development of a Caffeine infused version of Tauri-Gum™. When production run is complete, this will represent the 7th SKU of the Tauri-Gum™ product line.

Delta 8 Version of Tauri-Gum™

During March 2021, the Company developed a Delta-8-Tetrahydrocannabinol (“Delta-8-THC” or “Delta-8”) infused version of Tauri-Gum™. Delta-8-THC infused products are legal when the ingredient has been derived from the industrial hemp plant (“Cannabis Sativa”) and does not contain more than 0.3% (1/333^rd by dry weight composition) THC. The Company is focused on expanding both its product offerings and revenue opportunities, in a manner that is ethical, innovative, and fully compliant with Federal laws & regulations. Due to strong indications of demand, the Company has completed a double production run of its Evergreen Mint flavor, Delta 8 THC infused (10mg per piece of chewing gum), Version of Tauri-Gum™.

DISTRIBUTION OF THE COMPANY’S PRODUCTS

E&M Distribution Agreement

Under the terms of the E&M Distribution Agreement, the Company issued restricted shares of common stock to E&M for their support services.

South Florida Region Distribution Agreement

On April 8, 2019, the Company entered into a non-exclusive distribution agreement with IRM Management Corporation (“IRM”), an an established medical practice management firm (the “IRM Distribution Agreement”). The purpose of the IRM Distribution ~~Agreement~~ Agreement is to target our Tauri-GumTM product to the South Florida based medical market, including chiropractors, orthopedists, as well as prospective retail customers in this geographic area. In connection with this IRM Distribution Agreement, the Company has also agreed to a one-time issuance of 450,000 shares of the Company’s restricted common stock and a cash stipend of $10,000 to IRM. As of the date of this report, $6,000 of the $10,000 cash stipend has been paid. The value of the shares were reflected as stock-based compensation based on the grant date of April 8, 2019.

InNortheastern ~~connection~~United ~~with~~States ~~the IRM~~ Distribution Agreement, the Company agreed to a one-time issuance of restricted shares of the Company’s common stock and a cash stipend. For a more complete description of this arrangement please refer to Note 1 to the financial statements under Distributions of the Company’s Products as well as the agreement as exhibits file by reference thereto.

~~North~~On ~~Eastern~~April 30, 2019, the Company, entered into a non-exclusive comprehensive distribution agreement with Sai Krishna LLC (“SKL”), a New Jersey based distributor, with relationships in the Northeast region of the United States ~~Distribution~~and Asia. In connection with the SKL Agreement, the Company had issued 1,000,000 restricted common shares the Company’s stock in accordance with a further division of such shares as previously disclosed by us in previous periodic reports. The SKL distribution agreement expired on April 30, 2020 and was not renewed. Further, in connection with this agreement, on May 11, 2019, we also entered into a consulting agreement with Ms. Neelima Lekkala, who was appointed Vice President of Distribution & Marketing. This consulting agreement had a one-year term and expired on May 11, 2020 and was not renewed by us. As of March 31, 2021, Ms. Lekkala earned commission in the amount of $1,143.

On April 30, 2019, the Company, entered into a non-exclusive comprehensive distribution agreement with Sai Krishna LLC (“SKL”), a New Jersey based distributor, with relationships in the Northeast region of the United States and Asia, with the intention of increasing and accelerating market penetration of the Company’s Tauri-GumTM product line in the applicable regions.

In connection with the SKL agreement, the Company agreed to a one-time issuance of restricted shares of the Company’s common stock. In addition, the Company has agreed to issue restricted shares of the Company’s common stock to principals of SKL for assistance in the Company’s marketing strategy. This agreement expired on April 30, 2020.

On May 11, 2019, the Company also entered into a consulting agreement pursuant to the terms of the SKL agreement, whereby Ms. Neelima Lekkala was appointed Vice President of Distribution & Marketing. This agreement has a one-year term and expired on May 11, 2020. Ms. Lekkala focused her efforts on the expansion of Tauri-GumTM in terms of gross sales and revenue growth through the acquisition of new customers, establishment of professional marketing materials & protocols, logistics improvement(s) and fulfillment services. Ms. Lekkala was not an executive officer of the Company and, therefore, was not deemed to be an affiliate of the Company. Ms. Lekkala’s compensation included restricted shares of the Company’s common stock, which were fully earned and vested upon the execution of her consulting agreement. Additionally, Ms. Lekkala was entitled to receive a 30% commission on total gross sales through the sale of the Tauri-GumTM product line, which the Company was permitted to pay in either stock or cash at the election of Ms. Lekkala. As of March 31, 2020, Ms. Lekkala had earned commission in the amount of $1,023.

Windmill Health Distribution Agreement

On June 28, 2019, the Company entered into a distribution agreement with Windmill Health Products, LLC (“Windmill Health”), a New Jersey based distributor, with the intention of increasing and accelerating market penetration of the Company’s Tauri-Gum^TMproduct line. The Company did not contribute any capital or issue any equity to Windmill Health in connection with the Windmill Health distribution agreement.

These arrangements are more fully described in our periodic and current reports that we have filed with the Securities and Exchange Commission and included in these agreements as exhibits file by reference thereto.8

InMr. ~~connection~~Checkout ~~with~~Distribution the issuances of any restricted securities by the Company regarding the above-described distribution agreements or other agreements described in this annual report, please see Part II, Item 5, Unregistered Sales of Equity Securities for additional information.Agreement

~~Resale~~On ~~Agreement~~June 29, 2020, the Company entered into a “Go-To-Market” distribution agreement with OGMr. ~~LABORATORIES~~Checkout Distributors (“Mr. Checkout”), ~~LLC~~a marketing and consulting company located in Oviedo, Florida. The Mr. Checkout agreement enables the Company to launch its flagship brand Tauri-Gum™ through Mr. Checkout’s network of independent direct store distributors that service approximately 150,000 stores and retail locations across the United States. These stores include well-known convenience stores, gas station marts and supermarket chains. Under the terms of this agreement, on July 7, 2020, the Company paid a one-time $5,000 retainer on commission against the first $100,000 in sales. Subsequent commissions shall be paid to Mr. Checkout during the first thirty (30) days of the subsequent quarter once retainer has been met and exceeded. Commission will not be paid until the retainer has been met. As of March 31, 2021, the Company has recognized no sales via this agreement.

OnThink ~~January 21~~BIG, ~~2020, the Company entered into a joint venture agreement with OG LABORATORIES,~~ LLC ~~(“OG”).~~License Under this agreement the Company will act as a wholesaler of OG’s product labeled under OG’s name. We are currently wholesaling two of OG’s products: “Omega-3 Heart Wellness+CBD” and “Collagen Skin Wellness+CBD”. Both of these products will be offered on the Company’s website. The Company will be compensated for sales generated through its efforts according the following formula: the Company shall receive, no later than 30 days after collection, the following percentage of the total order amount for third-party customers who purchase OG products that Tauriga originated or derived: for aggregate purchases greater than one hundred thousand dollars ($100,000.00), Tauriga shall receive commission of three and a half percent (3.5%), and for aggregate purchases of one hundred thousand dollars ($100,000.00) or less, Tauriga shall receive commission of five percent (5%). . Tauriga shall receive the above-referenced commission on such sales as long as the sale is made while the contract is in force or within six (6) months after the contract’s termination. The OG agreement may be terminated by either party with thirty days of prior written notice to the other party. The Company made an initial purchase of OG inventory of $3,050 for e-commerce fulfillment.Agreement

On September 24, 2020, we entered into (i) a License Agreement (“License”) with Think BIG, LLC, a Los Angeles based company (“Think BIG”), (ii) a Professional Services Agreement (the “PSA”) with Willie C. Mack, Jr., CEO of Think BIG and (iii) a Professional Services Agreement (“PSA 2”) with Christopher J. Wallace, a co-founder of Think BIG (each of Willie C. Mack, Jr. and Christopher J. Wallace referred to herein as a “Brand Ambassador”), with the collective intent to enhance sales and marketing of the Company’s product lines, including its proprietary Rainbow Deluxe Sampler Pack (“Rainbow Pack”), and any co-branded products created by the parties to the License and each of the PSAs (the “Co-Branded Products”).

The term of this license is for a period of two years from September 24, 2020 (the “Effective Date”), unless earlier terminated by either party pursuant to the terms thereunder. The term of each of the PSA and the PSA 2 shall commence on the Effective Date and end on the earlier of (i) the two-year anniversary thereof; (ii) the termination for any reason of the License; or (iii) the earlier termination of the PSA Agreement pursuant to the terms thereunder.

The licensing arrangement permits for cross licensing, brand building, e-commerce customer acquisition efforts, retail customer acquisition efforts, enhanced social media presence, public relations & visibility strategies, as well as potential outreach to celebrities, and various other types of in-kind services in order to increase both Company revenue and customer acquisition efforts. The License will also allow for future joint development projects that will leverage the iconic “Frank White” brand and likeness/intellectual property (to which Think Big has the intellectual property rights). The Companies further agreed to a 50/50 gross profit split on sales of specially branded product, payable on or before the 15th day of each calendar month for the immediately preceding calendar month. In addition, the Company originally agreed to pay Think BIG, via a quarterly marketing fee for a period of twelve months in the amount $15,000 per quarter (for an aggregate total of $60,000), the first payment of which was paid by the Company within 10 days of the entry into the License. Subsequently, the parties agreed that the remaining payments would no longer be paid to Think BIG in exchange for the Company funding specially branded inventory printing and product as well as other marketing initiatives.

Under each of the PSA and the PSA 2, each Brand Ambassador shall provide promotional and marketing services (“Services”) to the Company during the term of the respective PSAs, subject to the terms and conditions set forth therein, in connection with the Co-Branded Products and any co-developed products; and perform their individual marketing and promotional services set forth under the PSA and the PSA 2, respectively, and each of the exhibits annexed thereto.

As consideration for each Brand Ambassador’s Services set forth under their respective PSAs, the Company agreed to issue each Brand Ambassador 1,500,000 restricted shares of the Company’s common stock, upon execution of the PSA and PSA 2. These shares were issued on December 17,2020. In the event that the applicable PSA has not previously been terminated, following the one-year anniversary of the Effective Date, an additional 1,500,000 restricted shares of Company’s common stock shall be issued to each Brand Ambassador, subject to the satisfaction of the terms of such additional services and/or criteria to be mutually agreed upon by the parties to the PSA and/or the PSA 2, as the case may be. In total, all shares issued and to be issued had a value of $183,600 that will be recognized over the term of the contract.

Stock Up Express Agreement

Effective February 1, 2021, the Company entered into a distribution agreement with Connecticut based Stock Up Express, a division of Bozzuto’s Inc., a distributor that generates more than $3 Billion in annual sales. The agreement shall remain in effect for a period of two (2) years, with automatic renewal for additional successive one (1) year terms. Under terms of this distribution agreement, Stock Up Express will market and resell the Company’s flagship brand, Tauri-Gum™, to its customer base of wholesale and retail customers in the mainland United States. The two companies will jointly market Tauri-Gum™ to Stock Up Express’ customer base. The Agreement allows for modification of product offerings, and the Company expects to offer additional product items over the course of calendar year 2021. Either party may terminate this Agreement for convenience by giving a sixty (60) day written notice to the other party or either party has the right to terminate this agreement if the other party breaches or is in default of any obligation hereunder, including the failure to make any payment when due, which default is incapable of cure or which, being capable of cure, has not been cured within thirty (30) days after receipt of written notice from the non-defaulting party or within such additional cure period as the non-defaulting party may authorize in writing.

These arrangements are more fully described in these agreements filed by reference as exhibits thereto.

REGULATORY MATTERS

Food and Drug Administration

On May 31, 2019, the U. S. Food and Drug Administration (“FDA”) held public hearings to obtain scientific data and information about the safety, manufacturing, product quality, marketing, labeling, and sale of products containing cannabis or cannabis-derived compounds, including CBD. The hearing came approximately five months after the Agricultural Improvement Act of 2018 (more commonly known as the Farm Bill), went into effect and removed industrial hemp from the Schedule I prohibition under the Controlled Substances Act (CSA) (industrial hemp means cannabis plants and derivatives that contain no more than 0.3 percent tetrahydrocannabinol, or THC, on a dry weight basis).

Though the Farm Bill removed industrial hemp from the Schedule I list, the Farm Bill preserved the regulatory authority of the FDA over ~~cannabis~~ cannabis and cannabis-derived compounds used in food and pharmaceutical products under the Federal Food, Drug, and Cosmetic Act (FD&C Act) and section 351 of the Public Health Service Act. The FDA has been clear that it intends to use this authority to regulate cannabis and cannabis-derived products, including CBD, in the same manner as any other food or drug ingredient. In addition to holding the hearing, the agency had requested comments by July 2, 2019 regarding any health and safety risks of CBD use, and how products containing CBD are currently produced and marketed, which comment period was concluded on July 16, 2019. As of the date hereof, the FDA has taken the position that it is unlawful to put into interstate commerce food products containing hemp derived CBD, or to market CBD as, or in, a dietary supplement. Furthermore, since the closure of the FDA hearings on this issue, some state and local agencies have issued a ban on the sale of any food or beverages containing CBD. ~~H.R.~~There ~~5587,~~have abeen ~~newly introduced~~ legislative ~~effort~~efforts at the federal level, ~~seeks~~which seek to ~~consider~~provide ~~hemp-derived~~clear ~~CBD and substances containing hemp-derived~~guidance ~~CBD~~ to beindustry ~~dietary~~stakeholders ~~supplements~~regarding ~~under~~how ~~the~~to ~~FD&C~~comply ~~Act,~~with ~~which~~applicable ~~would~~FDA ~~likely~~law ~~resolve~~with ~~ambiguity~~respect ~~and provide clear guidance~~ to ~~stakeholders about~~CBD ~~how~~and toother ~~comply~~hemp ~~with~~derived ~~applicable FDA law~~cannabinoids. However, such ~~H.R.~~legislative ~~5587~~efforts ~~was~~have ~~only~~been ~~recently~~limited ~~introduced~~and inas ~~the House~~ of ~~Representatives~~this date, ~~and~~ isthese inlegislative ~~its~~efforts ~~infancy,~~require ~~requiring~~extensive further approvals, including approval offrom ~~the~~both ~~House~~houses of ~~Representatives,~~Congress ~~the Senate~~ and the President of the United States, before being enacted into law, if at all.

7Furthermore, with respect to Company’s developing CBG and additional cannabinoid product lines, the FDA has provided no guidance as to how cannabinoids other than CBD (such as CBG) shall be regulated under the FD&C Act, and it is unclear at this time how such potential regulation could affect the results of the operations or prospects of the Company or this product line.

~~Furthermore, with respect to Company’s developing CBG product line, the~~ FDA ~~has provided no guidance as to how cannabinoids other than~~ ~~CBD~~ Clinical ~~(sch~~Trial asProcess ~~CBG)~~– ~~shall~~United beStates ~~regulated~~Drug ~~under the FD&C Act, and it is unclear at this time how such potential regulation could affect the results of the operations or prospects of the Company or this product line.~~Development

In the United States, the FDA regulates drugs, medical devices and combinations of drugs and devices, or combination products, under the FDCA and its implementing regulations. Drugs are also subject to other federal, state and local statutes and regulations. The process of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations requires the expenditure of substantial time and financial resources. Failure to comply with the applicable U.S. requirements at any time during the product development process, approval process or after approval, may subject an applicant to administrative or judicial sanctions. These sanctions could include, among other actions, the FDA’s refusal to approve pending applications, withdrawal of an approval, a clinical hold, untitled or warning letters, requests for voluntary product recalls or withdrawals from the market, product seizures, total or partial suspension of production or distribution injunctions, fines, refusals of government contracts, restitution, disgorgement, or civil or criminal penalties. Any agency or judicial enforcement action could have a material adverse effect on us.

The process required by the FDA before a drug may be marketed in the United States generally involves the following:

	●	completion of extensive pre-clinical in vitro and animal studies to evaluate safety and pharmacodynamic effects , formulation development, analytical method development, and manufacturing of the active pharmaceutical ingredient (API) and drug product for clinical trials in accordance with applicable regulations, including the FDA’s Current Good Laboratory Practice (cGLP) regulations and Current Good Manufacturing Practice (cGMP) regulations;

	●	submission to the FDA of an Investigational New Drug (IND) application, which must become effective before human clinical trials may begin;

	●	performance of adequate and well-controlled human clinical trials in accordance with an applicable IND and other clinical study related regulations, sometimes referred to as Current Good Clinical Practice (cGCPs), to establish the safety and efficacy of the proposed drug for its proposed indication, and API and drug product scale-up for registration batch production and stability;

	●	submission to the FDA of a New Drug Application (NDA);

	●	satisfactory completion of an FDA pre-approval inspection of the manufacturing facility or facilities at which the product, or components thereof, are produced to assess compliance with the FDA’s cGMP requirements;

	●	potential FDA audit of the clinical trial sites that generated the data in support of the NDA; and

	●	FDA review and approval of the NDA prior to any commercial marketing or sale.

Once a pharmaceutical product candidate is identified for development, it enters the pre-clinical testing stage. Pre-clinical tests include laboratory evaluations of product characterization, drug product formulation development and stability, as well as pharmacology and toxicology animal studies. An IND Sponsor must submit the results of the pre-clinical tests, together with manufacturing information, analytical data and any available clinical data or literature, to the FDA as part of the IND. The sponsor must also include a protocol detailing, among other things, the objectives of the initial clinical trial, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated if the initial clinical trial lends itself to an efficacy evaluation. Some pre-clinical testing may continue even after the IND is submitted. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA raises concerns or questions related to a proposed clinical trial and places the trial on a clinical hold within that 30-day period. In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. Clinical holds also may be imposed by the FDA at any time before or during clinical trials due to safety concerns or non-compliance, and may be imposed on all drug products within a certain class of drugs. The FDA also can impose partial clinical holds, for example, prohibiting the initiation of clinical trials of a certain duration or for a certain dose.

All clinical trials must be conducted under the supervision of one or more qualified investigators in accordance with GCP regulations. These regulations include the requirement that all research subjects provide informed consent in writing before their participation in any clinical trial. Further, an IRB must review and approve the plan for any clinical trial before it commences at any institution, and the IRB must conduct continuing review and reapprove the study at least annually. An IRB considers, among other things, whether the risks to individuals participating in the clinical trial are minimized and are reasonable in relation to anticipated benefits. The IRB also approves the information regarding the clinical trial and the consent form that must be provided to each clinical trial subject or his or her legal Representative and must monitor the clinical trial until completed.

Each new clinical protocol and any amendments to the protocol must be submitted for FDA review, and to the IRBs for approval. Protocols detail, among other things, the objectives of the clinical trial, dosing procedures, subject selection and exclusion criteria, and the parameters to be used to monitor subject safety.

Human clinical trials are typically conducted in three sequential phases that may overlap or be combined. The phases are described below. For the TAUG Pharma product, however, the safety profile of the API is known, and a Phase 1 program is not expected. Therefore, it is anticipated that that the first-time-in-human (FTIH) study will be a Phase 2 study.

	●	Phase 1. The product is initially introduced into a small number of healthy human subjects or patients and tested for safety, dosage tolerance, absorption, metabolism, distribution and excretion and, if possible, to gain early evidence on effectiveness. In the case of some products for severe or life-threatening diseases, especially when the product is suspected or known to be unavoidably toxic, the initial human testing may be conducted in patients.

	●	Phase 2. Involves clinical trials in a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage and schedule.

	●	Phase 3. Clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically dispersed clinical trial sites. These clinical trials are intended to establish the overall risk/benefit relationship of the product and provide an adequate basis for product labeling.

Post-approval trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval. These studies are used to gain additional experience from the treatment of patients in the intended therapeutic indication. In certain instances, the FDA may mandate the performance of Phase 4 trials. Companies that conduct certain clinical trials also are required to register them and post the results of completed clinical trials on a government-sponsored database, such as ClinicalTrials.gov in the United States, within certain timeframes. Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.

Progress reports detailing the results of the clinical trials, among other information, must be submitted at least annually to the FDA, and written IND safety reports must be submitted to the FDA and the investigators for serious and unexpected adverse events, findings from other studies that suggest a significant risk to humans exposed to the product, findings from animal or in vitro testing that suggest a significant risk to human subjects, and any clinically important increase in the rate of a serious suspected adverse reaction over that listed in the protocol or Investigator Brochure. Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within any specified period, if at all. The FDA or the clinical trial Sponsor may suspend or terminate a clinical trial at any time on various grounds, including a finding that the research subjects or patients are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the product has been associated with unexpected serious harm to patients. Additionally, some clinical trials are overseen by an independent group of qualified experts organized by the clinical trial sponsor, known as a data safety monitoring board or committee. This group provides authorization for whether a trial may move forward at designated check points based on access to certain data from the study. The clinical trial Sponsor may also suspend or terminate a clinical trial based on evolving business objectives and/or competitive climate.

The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, the manufacturer must develop methods for testing the identity, strength, quality and purity of the final product. Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its shelf life.

NDA and FDA Review Process

The results of product development, pre-clinical studies and clinical trials, along with descriptions of the manufacturing process, analytical tests conducted on the drug, proposed labeling and other relevant information, are submitted to the FDA as part of an NDA for a new drug, requesting approval to market the product. The submission of an NDA is subject to the payment of a substantial user fee, and the sponsor of an approved NDA is also subject to an annual program user fee; although a waiver of such fee may be obtained under certain limited circumstances. For example, the agency will waive the application fee for the first human drug application that a small business or its affiliate submits for review.

The FDA reviews all NDAs submitted before it accepts them for filing and may request additional information rather than accepting an NDA for filing. The FDA typically makes a decision on accepting an NDA for filing within 60 days of receipt. The decision to accept the NDA for filing means that the FDA has made a threshold determination that the application is sufficiently complete to permit a substantive review. Under the goals and policies agreed to by the FDA under the Prescription Drug User Fee Act (“PDUFA”), the FDA’s goal to complete its substantive review of a standard NDA and respond to the applicant is ten months from the receipt of the NDA. The FDA does not always meet its PDUFA goal dates, and the review process is often significantly extended by FDA requests for additional information or clarification and may go through multiple review cycles.

After the NDA submission is accepted for filing, the FDA reviews the NDA to determine, among other things, whether the proposed product is safe and effective for its intended use, and whether the product is being manufactured in accordance with cGMPs to assure and preserve the product’s identity, strength, quality and purity. The FDA may refer applications for novel drug products or drug products which present difficult questions of safety or efficacy to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. The FDA will likely re-analyze the clinical trial data, which could result in extensive discussions between the FDA and us during the review process. The review and evaluation of an NDA by the FDA is extensive and time consuming and may take longer than originally planned to complete, and we may not receive a timely approval, if at all.

Before approving an NDA, the FDA will conduct a pre-approval inspection of the manufacturing facilities for the new product to determine whether they comply with cGMPs. The FDA will not approve the product unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. In addition, before approving an NDA, the FDA may also audit data from clinical trials to ensure compliance with GCP requirements. After the FDA evaluates the application, manufacturing process and manufacturing facilities, it may issue an approval letter or a Complete Response Letter. An approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications. A Complete Response Letter indicates that the review cycle of the application is complete and the application will not be approved in its present form. A Complete Response Letter usually describes all the specific deficiencies in the NDA identified by the FDA. The Complete Response Letter may require additional clinical data and/or an additional pivotal Phase 3 clinical trial(s), and/or other significant and time-consuming requirements related to clinical trials, nonclinical studies or manufacturing. If a Complete Response Letter is issued, the applicant may either resubmit the NDA, addressing all the deficiencies identified in the letter, or withdraw the application. Even if such data and information are submitted, the FDA may ultimately decide that the NDA does not satisfy the criteria for approval. Data obtained from clinical trials are not always conclusive, and the FDA may interpret data differently than the Sponsor interprets the same data.

New York State Department of Health

The New York State Department of Health (NYDPH) has begun implementing regulations concerning the processing and retail sale of hemp derived cannabinoids. Under the regulations, “cannabinoid” is broadly defined as “any phytocannabinoid found in hemp, including but not limited to, Tetrahydrocannabinol (THC), tetrahydrocannabinolic acid (THCA), cannabidiol (CBD), cannabidiolic acid (CBDA), cannabinol (CBN), cannabigerol (CBG), cannabichromene (CBC), cannabicyclol (CBL), cannabivarin (CBV), tetrahydrocannabivarin (THCV), cannabidivarin (CBDV), cannabichromevarin (CBCV), cannabigerovarin (CBGV), cannabigerol monomethyl ether (CBGM), cannabielsoin (CBE), cannabicitran (CBT). Cannabinoids do not include synthetic cannabinoids as that term is defined [under New York law].”

These regulations came into effect on January 1, 2021, and all “cannabinoid hemp processors” and “cannabinoid hemp retailers” operating within the state of New York must be licensed by the NYDPH. The regulations expressly allow for food and beverages to contain “cannabinoids”, so long as such products meet certain requirements. To this end, the Company has submitted its license application with the NYDPH in compliance with this legislation. These regulations are evolving and the NYDPH recently issued a set of proposed regulations to address the use of industrial hemp derived Δ8- Tetrahydrocannabinol (Δ8 THC) and Δ10- Tetrahydrocannabinol (Δ10 THC) in cannabinoid hemp products manufactured and sold in New York. These proposed regulations are currently in a public comment period, and it is unclear at this time as to what the final regulations to be implemented will include.

The product requirements under the current regulations, include but are not limited to: the product must not contain more than 0.3% total Δ9- Tetrahydrocannabinol concentration; the product must not contain tobacco or alcohol; the product must not be in the form of an injectable, transdermal patch, inhaler, suppository, flower product including cigarette, cigar or pre-roll, or any other disallowed form as determined by the NYDPH; if the product is sold as a food or beverage product, it must not have more than 25mg of cannabinoids per product; and, if sold as an inhalable cannabinoid hemp product, the product will be subject to a number of additional safety measures.

Furthermore, all cannabinoid products sold at retail are subject to a series of labeling requirements. All such products must be labeled with the amount of cannabinoids in the product and the amount of milligrams per serving. If the product contains THC, the amount of THC in the product needs to be stated on the label in milligrams on a per serving and per package basis. In addition, all products are required to have a scannable bar code or QR code which links to a certificate of analysis and the packaging is prohibited from being attractive to consumers under 18 years of age. Products are also required to list appropriate warnings for consumer awareness. The Company’s entire product line will comply with the above standards.

See our Risk Factors for more information about these items, as well as certain related disclosures included our Results of Operations under the heading “Going Concern”.

The Company’s activities are subject to significant risks and uncertainties, including failing to secure additional funding, success in developing and marketing its products and the level of competition and potential regulatory enforcement actions. These risks and others are described in greater detail in the Risk Factors set forth in this prospectus.

~~2019~~OTHER ~~Increase~~BUSINESS ~~in Authorized Shares~~ITEMS

On July 26, 2019, the Company held a meeting of its board of directors. The matters voted on and approved at the meeting included an amendment to the Company’s Articles of Incorporation to increase the number of authorized shares of the Company’s common stock, $0.00001 par value per share from 100,000,000 to 400,000,000 shares (the “Authorized Shares Increase”). The increase in the authorized shares was approved by the shareholders of record at a special meeting of shareholders on September 10, 2019, and the Company promptly filed its Amended Articles of Incorporation with the division of corporations of the State of Florida to effectuate the increase in authorized shares, which was formally accepted by the Florida Division of Corporations on September 12, 2019.

Certified by Wal-Mart, Inc. to become a Domestic Supplier

On December 23, 2019, the Company announced that is has been certified by Wal-Mart, Inc. (“Walmart”) to become a ~~Domestic Supplier.~~domestic supplier. This certification from Walmart was obtained by the Company on December 19, 2019. On May 26, 2020, we also announced that our Walmart marketplace ~~Marketplace~~seller ~~Seller~~application ~~Application~~ had been officially approved. In joining Walmart ~~Marketplace~~marketplace, the Company has the opportunity to expand the presence of its products and product lines, with access to over a hundred million monthly customers. The Company is also approved to both list products on Walmart.com and sell directly to Walmart buyers. As of March 31, 2021, the Company has not recognized any sales through this channel. The Company was designated, by Walmart, Supplier ID # 36223459 and SAP Supplier # 1600179472.

Approval to Operate Global Seller Account by Alibaba Group

On January 6, 2020, the Company announced that is has been approved by Chinese multinational conglomerate, Alibaba Group (“Alibaba”), to operate a Global Seller Account. In addition, the Company has been designated as a Gold Supplier (Gold Tier Level Supplier). ~~This~~ This Alibaba approval opens up the global marketplace to the Company, its products, its product lines, as well as future business opportunities. The Company ishas ~~working~~a ~~diligently~~relationship ~~towards~~with ~~establishing~~ a ~~partnership~~fulfillment ~~with~~facility ain mainland China ~~based~~and ~~fulfillment~~is focusing on meeting buyers and ~~distribution~~virtual Alibaba Tradeshows. ~~network~~As of March 31, 2021, the Company has not recognized any sales through this channel.

Certified as Affiliate Vendor by The National Association of College Stores

On January 7, 2020, the Company announced that is has been certified by the National Association of College Stores (“NACS”) as an affiliate vendor. As a vendor of NACS, the Company has joined the most comprehensive group of campus retailers working to ~~provide~~ provide the best services and selections to college students across the United States. On January 12, 2021, the Company announced that its status as an affiliate vendor has been renewed by the NACS. The Company has been designated, by NACS, its Affiliate Vendor ID # 113921.

Investment Agreement and Registration Rights Agreement

On January 21, 2020, the Company entered into a $5,000,000 equity line financing agreement (“Investment Agreement”) with ~~Tangiers~~ Tangiers Global, LLC (“Tangiers”), as well as a registration right agreement related thereto (“Registration Rights Agreement”). The term of the financing is over a period of 36 months. Pursuant to the Registration Rights Agreement, a maximum of 76,000,000 shares of our Common Stock may be sold to Tangiers from time to time, which ~~have been~~were registered on our Form S-1 Registration Statement, ~~which~~and ~~was~~ declared effective by the Securities and Exchange Commission on March 16, 2020.

Subject to the terms and conditions of the equity line documents, from time to time, the Company ~~may~~was, inat its sole discretion, permitted to deliver aput ~~Put~~notices ~~Notice~~ to Tangiers which states the number of shares that the Company intends to sell to Tangiers on a closing date. The ~~maximum~~ maximum amount of shares of ~~Common~~common ~~Stock~~stock that the Company ~~shall~~was be entitled to put to Tangiers per any applicable ~~Put~~put ~~Notice~~notice ~~shall be~~was anthe amount of shares up to or equal to two hundred percent (200%) of the average of the daily trading volume (U.S. market only) of the ~~Common~~common ~~Stock~~stock for the ten (10) consecutive ~~Trading~~trading ~~Days~~days immediately prior to the applicable ~~Put~~put ~~Notice~~notice ~~Date~~date (the “Put Amount”) so long as such amount is at least ~~Five~~five ~~Thousand~~thousand ~~Dollars~~dollars ($5,000) and ~~does~~did not exceed ~~Three~~three ~~Hundred~~hundred ~~Fifty~~fifty ~~Thousand Dollars~~thousand dollars ($350,000), as calculated by multiplying the Put Amount by the average daily VWAP for the ten (10) consecutive ~~Trading Days~~trading days immediately prior to the applicable ~~Put~~put notice ~~Notice Date~~date. The “Purchase Price” of the shares of our Common Stock that we ~~may~~were able to sell to Tangiers ~~will~~was be 88% of the lowest VWAP of the ~~Common~~common ~~Stock~~stock during the five (5) consecutive Trading Days including and immediately following the applicable to the ~~Put Notice, provided, however, an additional 10% will be added to the~~ ~~discount~~put of each Put if (i) the Company is not DWAC eligible and (ii) an additional 15% will be added to the discount of each Put if the Company is under DTC “chill” status on the applicable Put Notice Datenotice.

On January 6, 2021, the Company determined to terminate its equity line of credit facility by terminating each of the Investment Agreement and Registration Rights Agreement, and on January 8, 2021 filed a Post-Effective Amendment to its Form S-1 Registration Statement (333-236923) removing from registration all shares of common stock not previously sold thereunder.

~~The~~As ~~closing~~ of a purchase by Tangiers of the shares specified by us in the Put Notice will occur on the date which is no earlier than five and no later than seven trading days following the date Tangiers receives the Put Notice. On a closing date we will sell to Tangiers the shares of our common stock specified in the Put Notice, and Tangiers will pay us an amount equal to the Purchase Price multiplied by the number of shares specified in the Put Notice. As of March 31, ~~2020~~2021, ~~the Company has exercised no put options under this agreement; however, subsequent to the end of our fiscal year,~~ we ~~have~~had issued 513,~~750~~910,000 shares of Common Stock in exchange for an aggregate of $~~154~~400,~~418~~514 asunder ofthis ~~the~~equity ~~date~~line of credit ~~filing~~facility. ofThe ~~this~~final ~~annual~~put ~~report~~notice was issued October 1, 2020.

Whole Foods Market, Inc. Registration

On June 8, 2020, the Company, announced that became a Registered Whole Foods Market, Inc. (“Whole Foods”) Vendor (“Supplier”). The Company’s information has now been updated in the Whole Foods Vendor Reporting Portal. As of March 31, 2021, the Company has not recognized any sales through this channel.

Federal Award Management Registration

On October 6, 2020, the Company announced that it was officially approved to operate as a U.S. Government Vendor. The Company has retained Federal Award Management Registration (“FAMR”) to commence the bidding process on several identified potential U.S. Government Contracts (“Contracts”). These potential Contracts are presented by the Department of Defense (“DOD”). FAMR is an independent consulting firm that specializes in: Registrations, Certifications, and Federal Contracting. The Company’s Commercial & Government Entity (“CAGE”) Code # is: 8QXV4 with an expiration date of October 1, 2021.

KushCo Holdings, Inc.

Effective July 10, 2020, the Company and KushCo Holdings, Inc., a Nevada corporation (“KushCo”), entered into a Product Placement Membership Agreement (the “Placement Agreement”). Under the terms of the Placement Agreement, KushCo will provide placement services of the Company’s Tauri-Gum™ product line(s), and will assist with retail activation, product incubation, branding and marketing solutions, and sales management services. As compensation for providing such services and placement of the Company’s products, when KushCo or one of its affiliates consummates a purchase, distribution or sale of products (either directly or through third parties), KushCo will be paid a fee equal to 10% of the total gross sales for such transaction(s) (the “Placement Fee”). The Placement Fee shall be earned as of the date of the respective transaction and shall be paid in cash by the Company on a monthly basis and no later than the last calendar day of each calendar month. The Placement Agreement has a term of two (2) years, unless earlier terminated upon sixty (60) days’ notice to the Company, as provided under the KushCo Agreement. As of March 31, 2021, the Company has not recognized any sales through this channel.

HISTORICAL BUSINESS ITEMS

Cupuaçu Butter Lip Balm

On December 23, 2016, the Company entered into a non-exclusive, 12-month license agreement (the “License Agreement”) with Cleveland, Ohio based cosmetics products company Ice + Jam LLC (“Ice + Jam”) to market Ice + Jam’s proprietary cupuaçu butter lip balm, sold under the trademark HerMan® which launched during the quarter ended December 31, 2017. During February of 2018, the Company’s strategy with respect to the HerMan® product was negatively impacted by a series of product defects relating to the twisting mechanism of the lip balm tube. As a result of this and the concomitant halting of selling efforts, the Company had no sales of the HerMan® product during the year ended March 31, 2019. The Company has removed the product from the website and the remaining inventory was written-off as it was determined that the units were not usable. The Company had discontinued this operation as of March 31, 2019.

Honeywood

Following the termination of a proposed 2014 merger between the Company and California-based Honeywood LLC (“Honeywood”), a developer of a topical medicinal cannabis product, on August 1, 2017, the Company entered into a Debt Conversion Agreement, whereby the Company agreed to convert an $170,000 note receivable due from Honeywood, including accrued interest into a 5% membership interest in Honeywood. At the time of the Honeywood Conversion Agreement, the receivable balance under the Note of $199,119 had been fully written off by the Company in a prior period. As a result of the Honeywood Conversion Agreement, the Company deemed the investment to have no current value.

Pilus Energy

On January 28, 2014, the Company acquired Pilus Energy, LLC (“Pilus”), an Ohio limited liability company and a developer of alternative cleantech energy platforms using proprietary microbial solutions that create electricity while consuming polluting molecules from wastewater. On December 22, 2016, the Company entered in a membership interest transfer agreement with Open Therapeutics whereby the Company sold 80% of its membership interest in Pilus back to Open Therapeutics for consideration of the termination of 80% of the unexercised portion of the warrants to purchase the Company’s common stock. Open Therapeutics agreed to pay to the Company 20% of the net profit generated Pilus Energy from its previous year’s earnings, if any. On January 12, 2019, the Company and Open Therapeutics agreed to extinguish a contingent liability in exchange for a one-time issuance of 500,000 restricted shares of Company’s common stock.

Blink Charging Company

On March 29, 2018 the Company’s then named subsidiary - Tauriga Biz Dev Corp. - entered into an independent sales representative ~~agreement~~ agreement with Blink Charging Company (NASDAQ: BLNK) (“BLINK”). Under this agreement we became a non-exclusive independent sales representative to solicit orders from potential customers for EV (“Electric Vehicle”) ~~Stations~~Station’s placement. This sales agreement has is a three-tier compensation model based on whether we contract the new customer to purchase equipment outright from BLINK or enter into one of two revenue-sharing agreements. IfOn ~~our~~June ~~subsidiary~~29, ~~effectuates~~2018, athe ~~sale~~Company ofpurchased four BLINK ~~equipment~~Level it– ~~will~~2 - 40” pedestal chargers ~~receive~~for permanent placement in a ~~one-time~~retail ~~sales~~location ~~commission~~or ~~based~~locations onwhereby the ~~sales~~Company ~~price~~will ofpay ~~the~~a ~~equipment~~variable ~~sale.~~annual Infee ~~the~~based ~~case~~on ~~where~~7% ~~our~~of ~~subsidiary~~total ~~secures a~~ revenue per ~~sharing~~charging ~~agreement~~unit. ~~with~~The arest ~~customer~~of ~~where~~the ~~BLINK~~proceeds ~~remains~~will be split 80/20 between the ~~owner,~~Company ~~then~~and ~~our~~the ~~subsidiary~~host ~~will~~location beowner ~~paid~~or anits ~~on-going~~assignee. ~~commission~~As of ~~based~~March ~~off~~31, 2021, we had not installed any of ~~gross~~these ~~charger~~machines ~~revenue~~in any locations, ~~subject~~and tono ~~which~~revenue ~~party~~has ~~paid~~been ~~for~~generated through the ~~installation~~Blink contract. April ~~Commission~~1, ~~payments~~2021, ~~under~~ the ~~revenue~~Company ~~sharing agreement~~had ~~are~~decided ~~subject~~ to ~~minimum~~abandon ~~revenue~~this ~~generation~~business ~~hurdles~~line, and therefore, we have reclassified these assets as held for sale.

On June 29, 2018, the Company purchased four BLINK Level – 2 - 40” pedestal chargers for permanent placement in a retail location or locations whereby the Company will pay a variable annual fee based on 7% of total revenue per charging unit. The rest of the proceeds will be split 80/20 between the Company and the host location owner or its assignee. The host location owner will pay for the cost of providing power to these unit as well as installation costs. As of December 31, 2019, we have not installed any of these machines in any locations, and no revenue has been generated through the Blink contract. Management has not made any decision regarding placement of these units at this time. The Company has not decided to abandon this business line, and therefore, we have not reclassified these assets as held for sale.

SUBSEQUENT EVENTS

Subsequent to March 31, ~~2020~~2021, the Company issued additional shares of ~~Common~~common ~~Stock~~stock as follows: (i); 65,~~000~~737,~~000~~500 ~~restricted~~ shares ofunder ~~common stock~~consulting ~~in a private placement purchased by accredited individual investors for cash of $191~~agreements,~~000~~ (~~$0.0318 per share); (~~ii) 1,~~000~~800,000 shares of restricted common stock ~~were issued to consultants~~ for ~~services rendered; (iii) 525,000 shares of restricted common stock for~~ commitment shares ~~relative~~and ~~to convertible notes issued;~~ (iviii) 202,~~009~~300,~~621~~000 shares of restricted common stock into ~~conversion~~accredited ofinvestors ~~convertible~~for ~~notes~~proceeds ~~issued~~totaling ~~by us of~~ $~~370~~174,000 ~~and accrued interest of $26,841;~~ (v)average ~~5,000,000 shares~~ of ~~restricted common stock were issued in conjunction with the collaboration agreement with Aegea Biotechnologies Inc~~$0.;0757/per ~~and (vi~~share) ~~5,750,000 registered shares of our Common Stock were issued under the Investment Agreement with Tangiers~~.

~~See~~Subsequent ~~description~~to ofMarch ~~our~~31, ~~stock issuances in this annual report beginning on page F-40~~2021, ~~and~~the asCompany ~~otherwise~~received ~~described~~funds in ~~this~~the ~~annual~~amount ~~report in~~of ~~more~~$100,000 ~~detail~~under ~~through~~a ~~the~~private ~~description~~placement ofagreement ~~the~~with ~~applicable~~an ~~agreements~~accredited ~~pursuant~~ investor to ~~which~~issue we2,500,000 ~~have~~shares ~~issued~~of ~~these~~restricted ~~securities~~common stock.

~~Collaboration~~On ~~Agreement~~May ~~with~~18, ~~Aegea~~2021, ~~Biotechnologies~~the Company exercised 180,000 of its Vistagen Therapeutics, Inc. five-year $1.50 registered warrants for $270,000 cash.

See the description of our Collaboration Agreement under the Business Section, general overview subheading, for a more expansive description of this transaction with Aegea Biotechnologies Inc., which was entered into for the purpose of developing a Rapid, Multiplexed Novel Coronavirus (COVID-19) Point of Care Test with Superior Sensitivity and Selectivity (the “SARS-Col 2 Test”). Pursuant to the terms of the Collaboration Agreement, we will help fund the development of the SARS-Col-2 Test, including through the use of our ELOC with Tangiers and other means as our management and board of directors may approve.14

10Corporate

~~Convertible~~On ~~Notes~~April 14, 2021, the Company formed NFTauriga Corp. in the State of Nevada, and wholly owned subsidiary. The Company is the sole holder of total authorized 100 shares having a par value of $0.00001. The Company’s Chief Executive Officer, Seth M. Shaw is the initial sole member of the board of directors, to serve until a successor is duly elected and qualified. Mr. Shaw will also serve as the Chief Executive Officer and Secretary. The registered office of NFTauriga Corp. in the State of Delaware shall be at 1013 Centre Road, Suite 403-B, Wilmington, DE 19805 in the County of New Castle. The name of its registered agent at such address is Vcorp Services, LLC. NFTauriga Corp. will have the same fiscal year and principal executive office and the Company.

GSConsulting ~~Capital, LLC~~agreement

On ~~April~~June 1714, ~~2020~~2021, the Company entered into a ~~one~~12-month ~~year~~Strategic 8%Marketing ~~$55,000~~and ~~convertible~~Consulting ~~Note~~Agreement with GSMayer ~~Capital~~& ~~Partners,~~Associates. ~~LLC~~Under ~~pursuant~~this agreement to the ~~terms~~ ofCompany awill ~~Securities~~pay ~~Purchase~~$150,000 ~~Agreement~~along ~~(“GS~~with ~~Note”).~~the ~~The~~issuance ~~GS Note has a maturity date~~ of ~~April 17~~3, ~~2021 and carried a $5~~500,000 ~~original~~shares ~~issue~~of ~~discount~~restricted ~~(such~~common ~~that~~shares ~~$50,000~~of ~~was funded to the~~ Company ~~on April 17, 2020)~~stock. ~~The holder is entitled, at its~~Half ~~option,~~of atthe ~~any time after~~ cash payment ($75,000) towas ~~convert~~paid ~~all~~upon orexecution ~~any amount~~ of the ~~principal~~agreement ~~face~~and ~~amount of~~ the GSother ~~Note~~half ~~then~~will ~~outstanding into~~be ~~shares~~paid of90 ~~the~~days ~~Company’s~~later. ~~common~~Upon ~~stock at a price for each share of common stock equal to 65% of~~ execution, the ~~lowest~~Company ~~daily~~shall ~~volume weighted~~issue ~~average~~2,200,000 ~~price (VWAP)~~ of the ~~common~~above-mentioned ~~stock~~shares. asThe ~~reported~~remaining ~~on the National Quotations Bureau OTC Markets exchange~~1,300,000 ~~which~~above-mentioned ~~the Company’s~~ shares ~~are~~will ~~traded~~be orissued ~~any~~90 ~~exchange~~days after ~~upon~~this ~~which~~contract ~~the~~was ~~common~~executed. ~~stock~~Mayer ~~may~~and beAssociate ~~traded~~will inprovide the ~~future,~~Company ~~for~~with ~~the~~opportunities ~~twenty~~relating ~~(20) prior~~to ~~trading days including~~ the ~~day~~world ~~upon which a notice~~ of ~~conversion~~professional sports, iswith ~~received~~respect byto ~~the~~its ~~Company~~products orand ~~its~~product ~~transfer agent~~lines. ~~During~~This ~~the~~includes ~~first six~~but ~~months~~is ~~that~~not ~~the~~limited GSto: ~~Capital~~introductions ~~Note~~to isprofessional insports ~~effect~~leagues, celebrity ~~the~~(professional ~~Company~~athletes) ~~may~~influencers/brand ~~redeem~~ambassadors/brand ~~the~~liaison(s), GSresearch ~~Note~~and bydevelopment ~~paying~~opportunities, tohosting ~~the~~of small ~~holder~~periodic anevents ~~amount~~for ~~as follows: (i) if~~ the ~~redemption~~Company isand ~~within~~a ~~the~~diversified ~~first~~group ~~90 days~~ of ~~the~~high-profile ~~issuance~~contacts ~~date~~and relationships, ~~then~~use ~~for~~social anmedia ~~amount~~exposure, podcasts ~~equal~~backing ~~to 120%~~ of ~~the~~various ~~unpaid~~elements ~~principal amount~~from ofprofessional ~~this~~sports ~~Note~~as ~~along~~well ~~with~~as ~~any~~assist ~~interest~~the ~~that~~Company ~~has~~in ~~accrued~~advising ~~during~~of ~~that~~potential ~~period,~~merger ~~(ii)~~partners and ifdeveloping ~~the~~corporate ~~redemption~~partnering isrelationships. ~~after~~The ~~the 91st day~~Company, ~~but~~ ~~less~~at ~~than~~ the ~~180th~~sole ~~day~~discretion of ~~the~~its ~~issuance date~~board, ~~then~~may ~~for~~pay an ~~amount~~additional ~~equal to 133%~~ payment of ~~the~~$75,000 ~~unpaid~~as ~~principal~~permitted ~~amount~~under of this ~~Note along with any accrued interest~~agreement. ~~The~~This GSadditional ~~Note~~payment ~~may~~will ~~not~~ be ~~redeemed~~recorded ~~after~~as ~~180~~a ~~days~~contingent ~~after~~liability ~~entering~~on ~~into it. In connection with~~ the ~~GS Capital Note, the~~ Company ~~issued irrevocable transfer agent instructions~~ ~~reserving~~consolidated ~~5,717,000~~balance ~~shares~~sheet ofuntil ~~its~~formally ~~common~~authorized ~~Stock~~by ~~for conversions under this Note (~~the ~~“Share~~Company’s ~~Reserve”)~~board ~~within 5 days from the date~~ of ~~execution and shall maintain a 2~~directors.5 ~~times~~This ~~reserve~~agreement ~~for~~is ~~the~~terminable ~~amount~~after six ~~then outstanding~~months. ~~Upon~~As ~~full~~of ~~conversion or~~the ~~repayment~~date of this ~~Note~~annual report, ~~any shares remaining in~~ the ~~Share~~aforementioned ~~Reserve~~shares ~~shall~~have bebeen ~~cancelled. The Company~~ issued toand ~~the~~are ~~noteholder 150,000~~reflected ~~shares~~above ofin ~~its restricted common stock as debt commitment shares valued at $5,000 ($0~~subsequent issuances.~~03 per share).~~

~~Adar~~Notes ~~Alef, LLC~~payable

OnTangiers April ~~30,~~2021Fixed ~~2020, the Company entered into securities purchase agreement with Adar Alef, LLC whereby the Company issued an 8%~~ convertible ~~redeemable~~ note in( ~~the principal amount of~~ $~~44,000~~0.075 ~~The~~per note was funded with net proceeds of $37,800, after the deduction of $4,000 for OID and $2,200 in legal fees. The note has a maturity date of April 30, 2021. The face value amount plus accrued interest under the note are convertible into shares of the Company’s common stock at a price for each share of common stock equal to 65% of the lowest daily VWAP of the common stock as reported on the National Quotations Bureau OTC Markets market on which the Company’s shares are traded or any exchange upon which the common stock may be traded in the future, for the 20 prior trading days including the day upon which a notice of conversion is received by the Company or its transfer agent. During the first 6 months following the Issuance Date, the Company may redeem this Note by paying to the Holder an amount equal to the sum of 140% of the face amount plus any accrued interest. The Company shall establish an initial reserve of 7,736,000 shares of its common stock and at all times reserve a minimum of 4 times the amount of shares required if the note were to fully convert. This Note may not be prepaid after the 6-month anniversary of the issuance date.)

~~Tangiers~~On April 5, 2021, the Company effectuated a $525,000 six-month fixed convertible promissory note with Tangiers Global, LLC containing an original issue discount of $25,000. This note matures on October 5, 2021 and bears an interest rate of 8%, guaranteed. This note has a fixed conversion price of $0.075 per share. The Company may redeem the note by paying to Tangiers an amount as follows: (i) if within the first 90 days of the issuance date, then for an amount equal to 110% of the unpaid principal amount so paid of this Note along with any interest that has accrued during that period, and (ii) if after the 91st day, but by the 180th day of the issuance date, then for an amount equal to 120%. After 180 days from the effective date, the Company may not pay this note in cash, in whole or in part without prior written consent by Holder. The Company covenants that it will at all times reserve out of its authorized and unissued Common Stock the number of shares of Common Stock as shall be issuable upon the conversion of this note. Tangiers may not engage in any “shorting” or “hedging” transaction(s) in the Common Stock of the Company prior to conversion. The note contains a number of additional covenants and other provisions, including default or penalty clauses, cross-default, restrictions on note proceeds, maintain exchange and SEC requirements, delivery of shares, reservation of share requirements and other such provisions, each as set forth in more detail in the note and SPA. If an Event of Default occurs, the outstanding Principal Amount of this Note owing in respect thereof through the date of acceleration, shall become, at the Tangiers’s election, immediately due and payable in cash at the “Mandatory Default Amount”. The Mandatory Default Amount means 20% of the outstanding Principal Amount of this Note will be automatically added to the Principal Sum of the Note and tack back to the Effective Date for purposes of Rule 144. Commencing 5 days after the occurrence of any Event of Default that results in the eventual acceleration of this Note, this Note shall accrue additional interest, at a rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. The Company has issued 1,000,000 of its restricted common debt incentive shares having a value of $129,000 ($.0129/share).

OnGS ~~May~~Capital 8Partners, ~~2020,~~LLC ~~the Company effectuated a six~~Non-~~month fixed~~ convertible promissory note with Tangiers Global, LLC with a total face value of $102,500 containing an original issue discount of $2,500. On May 8, 2020, the Company received funds in the amount of $50,000 and recognized original issue discount of $1,250. This note matures on November 8, 2020 and bears an interest rate of 5%, guaranteed. This note has a fixed conversion price of $0.03 per share. In the event of default this note will accrue at a rate of 15% per annum or the highest rate permitted by law. The Company may redeem the note by paying to Tangiers an amount as follows: (i) if the redemption is within the first 90 days of the issuance date, then for an amount equal to 110% of the unpaid principal amount so paid of this Note along with any interest that has accrued during that period, and (ii) if the redemption is after the 91st day, but by the 180th day of the issuance date, then for an amount equal to 120%. After 180 days from the effective date, the Company may not pay this note, in whole or in part without prior written consent by Holder. The Company covenants that it will at all times reserve and keep available for Tangiers, out of its authorized and unissued Common Stock three times the number of shares of Common Stock as shall be issuable upon the full conversion of this Note. If the Note is not retired on or before the Maturity Date, then at any time and from time to time after the Maturity Date, and subject to the terms hereof and restrictions and limitations contained herein, the Tangiers shall have the right, at the Tangiers’s sole option, to convert in whole or in part the outstanding and unpaid Principal Amount under this Note into shares of Common Stock at the Variable Conversion Price which shall be equal to the lower of: (a) the Fixed Conversion Price or (b) 70% of the lowest volume weighted average price of the Company’s Common Stock during the 15 consecutive Trading Days prior to the date on which Tangiers elects to convert all or part of the Note.Debenture

~~Firstfire~~On ~~Global~~April ~~Opportunities~~30, 2021, the Company entered into a Securities Purchase Agreement and a non-convertible redeemable note with GS Partners Capital, LLC. The $313,000 aggregate principal note has a maturity date of June 1, 2022 and carries $23,000 Original Issue Discount with an interest rate of 8%. This note may be prepaid without penalty, provided that an event of default has not occurred. Upon an event of default, interest shall accrue at a default interest rate of 24% per annum or, if such rate is usurious or not permitted by current law, then at the highest rate of interest permitted by law. This note contains a number of additional covenants and other provisions, including default or penalty clauses, cross-default and other such provisions, each as set forth in more detail in the note and SPA.

On May 18, 2020, the Company entered into a Securities Purchase Agreement (“SPA”) with Firstfire Global Opportunities Fund, LLC (“Firstfire”) pursuant to a convertible promissory note in the principal amount of $88,333, having an original issue discount in the amount of $8,833. On May 24, 2020, the Company received funds in the amount of $75,000 after the deduction of legal fees in the amount of $4,500. This note bears an annual interest rate of 8%. The per share conversion price into which Principal Amount and interest under this Note shall be convertible into shares of Common Stock hereunder shall be equal to 65% multiplied by the average of the two (2) lowest volume weighted average prices of the Common Stock during the fifteen (15) consecutive Trading Day period immediately preceding the date of the respective conversion. The borrower covenants that at all times until the Note is satisfied in full, the borrower will reserve from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the issuance of a number of Conversion Shares equal to the greater of: (a) 8,500,000 shares of Common Stock or (b) the sum of the number of Conversion Shares issuable upon the full conversion of this Note multiplied by (ii) three and a half (3.5). At any time prior to or as of the earlier of the (i) the first conversion date and (ii) the 180th calendar day after the issue date, the borrower shall have the right to prepay the outstanding principal amount and interest then due under this note. If the borrower exercises its right to prepay the note at any time within the initial 30 calendar days following the issue date, the borrower shall make payment to the holder of an amount in cash equal to the sum of: (w) 115% multiplied by the principal amount then outstanding plus (x) accrued and unpaid interest on the principal amount.

11For a more complete description of securities purchase agreements, convertible notes and other notes that the Company has entered into subsequent to March 31, 2021, please refer to agreements filed by us as exhibits to or incorporated by reference in this annual report, which disclosure is incorporated by reference into this Item 1.

If the borrower exercises its right to prepay the note at any time from the 31st calendar day through the 60th calendar day following the issue date, the borrower shall make payment to the holder of an amount in cash equal to the sum of: (w) 125% multiplied by the principal amount then outstanding plus (x) accrued and unpaid interest on the principal amount. If the borrower exercises its right to prepay the note at any time from the 61st calendar day through the 120th calendar day following the issue date, the borrower shall make payment to the holder of an amount in cash equal to the sum of: (w) 135% multiplied by the principal amount then outstanding plus (x) accrued and unpaid interest on the principal amount. If the borrower exercises its right to prepay the note at any time from the 121st calendar day through the 180th calendar day following the issue date, the borrower shall make payment to the holder of an amount in cash equal to the sum of: (w) 140% multiplied by the principal amount then outstanding plus (x) accrued and unpaid interest on the principal amount.

Tangiers Global, LLC

On June 24, 2020, the Company effectuated a six-month fixed convertible promissory note with Tangiers Global, LLC with a total face value of $210,000 containing an original issue discount of $10,000. On June 26, 2020, the Company received funds in the amount of $200,000 and recognized original issue discount of $10,000. This note matures on December 24, 2020 and bears an interest rate of 8%, guaranteed. This note has a fixed conversion price of $0.03 per share. The Company may redeem the note by paying to Tangiers an amount as follows: (i) if the redemption is within the first 90 days of the issuance date, then for an amount equal to 110% of the unpaid principal amount so paid of this Note along with any interest that has accrued during that period, and (ii) if the redemption is after the 91st day, but by the 180th day of the issuance date, then for an amount equal to 120%. After 180 days from the effective date, the Company may not pay this note, in whole or in part without prior written consent by Holder. The Company covenants that it will at all times reserve and keep available for Tangiers, out of its authorized and unissued Common Stock three times the number of shares of Common Stock as shall be issuable upon the full conversion of this Note. If the Note is not retired on or before the Maturity Date, then at any time and from time to time after the Maturity Date, and subject to the terms hereof and restrictions and limitations contained herein, the Tangiers shall have the right, at the Tangiers’s sole option, to convert in whole or in part the outstanding and unpaid Principal Amount under this Note into shares of Common Stock at the Variable Conversion Price which shall be equal to the lower of: (a) the Fixed Conversion Price or (b) 70% of the lowest volume weighted average price of the Company’s Common Stock during the 15 consecutive Trading Days prior to the date on which Tangiers elects to convert all or part of the Note.

Odyssey Funding, LLC

On June 29, 2020, the Company fully paid and retired the Odyssey Funding, LLC dated December 18, 2019 having principal of $100,000 and accrued interest in the amount of $4,252. This note included a prepayment penalty in the amount of $45,748. The share reserve of 22,084,000 shares was released upon satisfaction of the note and returned to treasury.

Investment – Küdzoo, Inc.

Concerning the Company’s Investment in Küdzoo, Inc. of $105,600, subsequent to March 31, 2020, the current equity round, the entire valuation under which the Company invested was revalued to a valuation of $7,500,000 and the Company was made whole by a proportionate increase in its equity ownership. As of March 31, 2020, the Company’s adjusted ownership percentage was 1.41%.

For a more complete description of convertible notes that the Company has entered into subsequent to March 31, 2020 please see Note 15 to our financial statements– Subsequent Events in Part II of this annual report starting on page F-50, as well as in agreements filed by us as exhibits to or incorporated by reference in this annual report, which disclosure is incorporated by reference into this Item 1.

Reports to Security Holders

In accordance with the rules and regulation of the Securities and Exchange Act of 1934, as amended, we file with the Securities and Exchange Commission annual reports containing financial statements audited by our independent registered public accounting firm and quarterly reports containing unaudited financial statements for each of the first three quarters of each year. We file Quarterly Reports on Form 10-Q, Annual Reports on Form 10-K and Current Reports on Form 8-K with the Securities and Exchange Commission in order to meet our timely and continuous disclosure requirements. We may also file additional documents with the Commission if they become necessary in the course of our company’s operations.

The public may read and copy any materials that we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of that site is www.sec.gov.

Environmental Regulations

We do not believe that we are or will become subject to any environmental laws or regulations of the United States. While our products and business activities do not currently violate any laws, any regulatory changes that impose additional restrictions or requirements on us or on our products or potential customers could adversely affect us by increasing our operating costs or decreasing demand for our products or services, which could have a material adverse effect on our results of operations.

Investments

Pilus Energy, LLC

On December 22, 2016, the Company entered in a membership interest transfer agreement with Open Therapeutics whereby the Company sold 80% of its membership interest in Pilus back to Open Therapeutics for consideration of the termination of 80% of the unexercised portion of the warrants to purchase the Company’s common stock. Open Therapeutics agreed to pay to the Company 20% of the net profit generated Pilus Energy from its previous year’s earnings, if any. As of March 31, 2020, the Company has recognized revenue from this investment.

VistaGen Therapeutics, Inc.

On December 411, 2019, ~~VTGN adjusted~~ the ~~strike price of the~~ Company’s ~~230,000~~purchased ~~February~~three ~~2022~~year warrants toexercisable ~~$0.50~~for ~~each.~~up ~~These~~to ~~was neither~~250,000 ashares ~~gain~~of ~~nor~~common ~~loss~~stock onof ~~the~~Vistagen Therapeutics ~~transaction~~Inc. ~~since~~at ~~there~~a iscost noof ~~value~~$0.15 ~~recognized~~each by(total ~~the~~purchase ~~Company.~~price Atof ~~March 31~~$37,500). ~~2020,~~These ~~these~~ warrants ~~were~~ ~~out~~have ofa ~~the~~strike ~~money~~price byof $0.0650 ~~per share~~each. As ~~Since~~of ~~these~~March ~~230~~31,~~000~~ ~~total warrants are not publicly traded~~2021, ~~the Company has not recognized the value of~~ these warrants aswere ~~they~~exercised, ~~are~~in ~~not~~full, ~~liquid.~~and ~~The~~the ~~strike~~resultant ~~price~~shares onhave ~~these~~a ~~options~~cost ~~will~~basis ~~revert~~of ~~back to~~ $10.5065 atper ~~December 4, 2021 for all unexercised options~~share.

OnIn ~~December~~addition 11to the 250,000 ~~2019~~Vistagen warrants noted above, at March 31, 2021, the Company ~~purchased~~currently ~~250~~holds warrants in Vistagen to purchase 320,000 ~~three-year~~shares ~~restricted~~of ~~warrants~~common ~~for~~stock ~~VTGN~~ at a ~~cost~~strike price of $1.50 per share with an expiration of December 13, 2022. At March 31, 2021 these warrants were in of the money by $0.1544 each. ~~(total~~The Company also owned warrants for Vistagen to purchase 230,000 shares ~~value~~of common stock at a strike price of $371.50 per share with an expiration of February 28,~~500)~~ 2022. ~~These~~On ~~warrants~~December ~~have~~4, a2019, Vistagen adjusted the strike price of the February 2022 warrants to $0.50 each. AtAs of March 31, ~~2020~~2021, these ~~shares~~warrants were exercised and the resultant shares have a cost basis of $0.0650 ~~out~~per share. The Company still holds 320,000 total warrants at a strike price of ~~the~~$1.50 ~~money but~~per ~~since~~share. ~~these~~Since these warrants are not publicly traded, the Company has not recognized the value of these warrants as they are not liquid.

~~Küdzoo~~On February 18, 2021, the Company’s board of directors authorized the open market sale of 220,000 of the 710,000 shares it holds in Vistagen Therapeutics Inc.

~~On April~~As 8,of ~~2019~~June 25, ~~the~~2021 ~~Company~~and ~~invested~~subsequent ~~$20,400~~to inMarch ~~Küdzoo~~31, ~~Inc.~~2021, ~~in which~~ the Company ~~had~~has ~~previously~~sold ~~invested $37~~485,~~500.~~000 ~~The~~shares ~~$20,400 investment was recorded at cost representing a 0.2%~~ of ~~the~~its ~~proportionate~~holdings ~~interest~~ in ~~the~~Vistagen ~~outstanding~~for ofproceeds ~~the Company after this offering based on a pre-money valuation~~ of $101,~~200~~153,~~000~~645.

On December l8, 2019, the Company invested $22,000 in Küdzoo, Inc. The $22,000 investment was recorded at cost representing a 0.2% of the proportionate interest in the outstanding of the Company after this offering based on a pre-money valuation of $10,200,000.16

On January 6, 2020 and January 24, 2020, the Company invested a total of $25,700 in Kudzoo, Inc. The $25,700 investment was recorded at cost representing a 0.2% of the proportionate interest in the outstanding of the Company after this offering based on a pre-money valuation of $10,200,000.

Aegea Biotechnologies Inc.

~~Pursuant~~On toApril ~~the~~3, ~~amended~~2020, ~~terms~~Tauriga ofSciences, ~~the~~Inc. ~~Collaboration~~entered ~~Agreement~~into ~~(See~~a ~~the~~collaboration ~~description~~agreement ~~of our~~ (“Collaboration Agreement”) ~~under the Business Section, general overview subheading, for a more expansive description of this transaction~~ with Aegea Biotechnologies Inc. (“Aegea”), ~~which was entered into~~ for the purpose of developing a Rapid, Multiplexed Novel Coronavirus (COVID-19) Point of Care Test with Superior Sensitivity and Selectivity (the “SARS-Col 2 Test”). ~~Pursuant~~The toparties believed that the ~~terms~~benefits of the ~~Collaboration~~SARS-CoV-2 ~~Agreement,~~Test wewere ~~are~~the ~~funding~~following: a Rapid SARS-CoV-2 test with the ~~development~~sensitivity ofand specificity to eliminate false negatives and false positives, and with the ability to detect and measure viral shed, even in patients who are asymptomatic. This SARS-~~Col~~CoV-2 ~~Test~~test would use Aegea’s patented technologies, ~~including~~to ~~through~~take coronavirus testing to the ~~use~~next level by differentiating different strains of ~~our~~SARS-CoV-2. ~~ELOC~~The ~~with~~test, ~~Tangiers~~if ~~and~~successful, would ~~other~~be ~~means~~adaptable to additional SARS-CoV-2 strain types as ~~our~~necessary ~~management~~and as the virus mutates. It also has the possibility to rapidly be customized to provide similarly sensitive and ~~board~~specific ofassays ~~directors~~for ~~may~~other ~~approve~~viruses. AsThe Company committed to raise funding for the purposes set forth in under the Collaboration Agreement from its $5,000,000 Equity Line of ~~this~~Credit ~~report~~(“ELOC”) ~~date~~with ~~and~~Tangiers ~~subsequent~~Global, toLLC, which became effective on March 16, 2020. Seventy percent (70%) of the ~~balance~~net ~~sheet~~proceeds ~~date~~from the sale of the initial 10,000,000 shares of stock of Tauriga under the ~~Company~~ELOC ~~has~~were invested ~~$183,443~~ in ~~exchange~~Aegea for ~~45,861~~the development of the Covid Test and used to purchase shares of common stock of Aegea, (at a purchase price of $4.00 per share). The $4.00 stock price corresponds to a current pre-money valuation of Aegea of $25,000,000 for each tranche of cash, up to the first $2,000,000 of our investment in Aegea. Additionally, as part of our agreement with Aegea, on May 26, 2020, Tauriga issued to Aegea 5,000,000 unregistered common shares of Tauriga common stock. On August 10, 2020, the Company and Aegea amended their Collaboration Agreement. Under the terms of the amendment, having invested 70% of the proceeds from the sale of the initial 10,000,000 shares of Tauriga stock under the ELOC with Tangiers, the Company increased the percentage of proceeds it invested in Aegea on the sale of the remaining shares available under the ELOC agreement from 20% to 40%.

~~All~~On ofJanuary 6, 2021, however, the Company’s ~~investments~~determined ~~are~~to ~~more~~terminate ~~fully~~its ~~described~~ELOC inby terminating each of the ~~Notes~~Investment Agreement and Registration Rights Agreement, and on January 8, 2021 filed a Post-Effective Amendment to its Form S-1 Registration Statement (333-236923) which removed from registration all shares not previously sold thereunder. This effectively also eliminates our ~~financial~~obligation ~~statements~~to any additional funding to Aegea under the Collaboration Agreement. As of March 31, 2021, the Company had invested $278,212 in ~~Note~~Aegea ~~12-~~for ~~Investments~~69,553 shares, representing an ownership percentage of 1.03%. As of March 31, 2021, resultant delays of project milestones have led the Company to determined that full recovery of its investment in Aegea is in doubt and ~~Note~~has 15recorded –a ~~Subsequent~~50% ~~Events~~impairment asloss ~~well~~on asits consolidated Statement of Operations in ~~agreements~~the ~~filed~~amount byof ~~reference~~$139,106. asAegea ~~exhibits~~is ~~thereto~~still moving forward on this project and the Company will continue to monitor the progress.

SciSparc Ltd.

On March 1, 2021, the Company invested $88,375 for 12,500 units of SciSparc Ltd. (formerly known as Therapix Biosciences Ltd.) (OTCQB: SPRCY), a specialty, clinical-stage pharmaceutical company focusing on the development of cannabinoid-based treatments. The Company’s investment (acquisition of an equity stake with warrants) into SciSparc Ltd., was pursuant to an $8,150,000 private placement offering, comprised 1,152,628 Units to certain institutional and accredited investors in a private placement at an offering price of $7.07 per Unit. Each Unit consists of 1 American Depositary Share (“ADS”), 1 Series A Warrant and ½ Series B Warrant. The Series A Warrants have an exercise price of $7.07, subject to adjustments therein. The Series B Warrants have an exercise price equal to $10.60, subject to adjustments therein. The Series A Warrants and the Series B Warrants are exercisable six months from the date of issuance and have a term of exercise equal to five years from the initial exercise date. 278,744 of the Units included a Pre-Funded Warrant instead of an ADS. The Pre-Funded Warrants have an exercise price of $0.001 per full ADS. Aegis Capital Corp. acted as Exclusive Placement Agent in the United States in connection with the offering. The Company has recorded this investment at cost and will test for impairment annually.

Paz Gum LLC

Effective February 5, 2021, the Company purchased five percent of the membership units in Paz Gum LLC, a Nevada limited liability company under the terms of a Membership Unit Purchase Agreement for an aggregate purchase price of $50,000. The Company and Paz will endeavor to cross market and increase sales of our products, along with such other products that Paz Gum undertakes in their discretion.

Employees

As of March 31, ~~2020~~2021, we had a total of two persons devoting substantially full-time services to the Company under consultancy arrangements. They are Seth M. Shaw, the Company’s Chief Executive Officer, and Kevin Lacey, the Company Chief Financial Officer.

Available Information

All reports of the Company filed with the SEC are available free of charge through the SEC’s web site at www.sec.gov. In addition, the public may read and copy materials filed by the Company at the SEC’s Public Reference Room located at 100 F Street, N.E., Washington, D.C. 20549. The public may also obtain additional information on the operation of the Public Reference Room by calling the Commission at 1-800-SEC-0330.

1317

ITEM 1A. RISK FACTORS

The following important factors among others, could cause our actual operating results to differ materially from those indicated or suggested by forward-looking statements made in this Form 10-K or presented elsewhere by management from time to time.

An investment in our common stock involves a number of significant risks, known and unknown, that may prevent us from achieving our goals. If any of these risks actually occur, our business, financial condition or results of operation may be materially adversely affected.

You should carefully consider the following risks and uncertainties in addition to other information in this prospectus (such as the Going Concern note to its financials) in evaluating our Company and our business before purchasing our securities. Our business, operating results and financial condition could be seriously harmed, and the trading price of our common stock could decline and investors could lose all or part of their investment, as a result of the occurrence of any of the following risks. You should invest in our common stock only if you can afford to lose your entire investment.

The outbreak of the coronavirus may negatively impact our business, results of operations and financial condition.

The outbreak of the coronavirus may negatively impact our business, results of operations and financial condition. In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, which has and is continuing to spread throughout China and virtually all other parts of the world, including the United States. On January 30, 2020, the World Health Organization declared the outbreak of the coronavirus disease (COVID-19) a “Public Health Emergency of International Concern.” On January 31, 2020, the then U.S. Health and Human Services Secretary Alex M. Azar II declared a public health emergency for the United States to aid the U.S. healthcare community in responding to COVID-19, and on March 11, 2020 the World Health Organization characterized the outbreak as a “pandemic”. The significant outbreak of COVID-19 has resulted in a widespread health crisis that could adversely affect the economies and financial markets worldwide, and could adversely affect our business, results of operations and financial condition, including coordination and completion of financial and operational matters and attendance at our events resulting from social distancing, travel restrictions, movement and large gathering restrictions, the public’s fears associated with the Pandemic, including air travel. The ultimate extent of the impact of any epidemic, pandemic or other health crisis on our business, financial condition and results of operations will depend on future developments, which are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of such epidemic, pandemic or other health crisis and actions taken to contain or prevent their further spread, among others. While the pandemic has seemingly curbed, and certain emergency use vaccines have been widely distributed and continue to be distributed in the United States, numerous other countries have not developed or distributed vaccines at all or on widespread bases, and, therefore, may continue to see widespread contraction of the Covid-19 virus. The negative economic impacts on economies generally, resulting volatility in the stock market, and the negative impact on many industries, the workforce and retailers continues to be felt. Additionally, there is a possibility that vaccine resistant strains of the Covid 19 virus may appear, and in limited instances have begun to appear in parts of the globe in 2021. These and other potential impacts of an epidemic, pandemic or other health crisis, such as COVID-19, could therefore materially and adversely continue to affect our economies and business, financial condition and results of operations.

There could be unidentified risks involved with an investment in our securities.

The following risk factors are not a complete list or explanation of the risks involved with an investment in the securities. Additional risks will likely be experienced that are not presently foreseen by the Company. Prospective investors must not construe the information provided herein as constituting investment, legal, tax or other professional advice. Before making any decision to invest in our securities, you should read this entire prospectus and consult with your own investment, legal, tax and other professional advisors. An investment in our securities is suitable only for investors who can assume the financial risks of an investment in the Company for an indefinite period of time and who can afford to lose their entire investment. The Company makes no representations or warranties of any kind with respect to the likelihood our business will succeed, whether any regulatory agency may enforce the food and drug administration’s ban on consumable CBD/CBG products, including the Company’s products or regarding the value of our securities, any financial returns that may be generated or any tax benefits or consequences that may result from an investment in the Company.

Risks Related to Company’s Business

Cannabinoids are chemical compounds that are commonly found in or derived from cannabis and industrial hemp plants, including but not limited to Tetrahydrocannabinol (THC), the psychoactive chemical compound, and non-psychoactive chemical compounds, such as Cannabidiol (CBD) and Cannabigerol (CBG). It is believed that there are at least 120 cannabinoid compounds within cannabis and industrial hemp plants.

The Company is currently engaged in the sale of products that include CBD and CBG, and intends to engage in the sale of products that ~~include~~ ~~CBG~~include hemp derived Δ8 THC, and is also is considering creating product lines that include other cannabinoids,. ~~although~~The ~~the~~ Company’s current products ~~contain~~ nodo ~~THC and the Company does~~ not ~~currently plan to produce or sell any products that~~ contain any or more than 0.3% THC.

Cannabinoids can be found in or derived from both cannabis plants and industrial hemp plants. Industrial hemp is a varietal of the cannabis sativa plant that has been bred to have a low level of THC (below 0.3% THC). Cannabis sativa plants that have above 0.3% THC are considered cannabis plants. Due to the unique regulatory framework of both the cannabis and hemp industries, the source of the cannabinoid (i.e., whether it is derived from an industrial hemp plant or a cannabis plant) makes a significant difference in the legality and risks associated with any product that includes such cannabinoid.

As of the date hereof, the Company’s current product offerings contain and intended product offerings will contain CBD, CBG, and ~~CBG~~Δ8 THC derived exclusively from industrial hemp. A description of industrial hemp industry specific risks is set forth below. ~~While~~ While the Company does not currently sell any products derived from cannabis, to the extent that, in the future, Company may decide to to offer products with cannabinoids derived from cannabis, cannabis industry specific risks are also described below.

Industrial Hemp Industry Risks

Legal Uncertainty Surrounding Current Industrial Hemp Regulations.

The laws and regulations affecting the industrial hemp industry are constantly changing, which could detrimentally affect the Company’s proposed operations. Local, state and federal industrial hemp laws and regulations are broad in scope and subject to evolving interpretations, which could require the Company to incur substantial costs associated with compliance or alter its business plan. In addition, violations of these laws, or allegations of such violations, could disrupt the Company’s business and result in a material adverse effect on its operations. In addition, it is possible that regulations may be enacted in the future that will be directly applicable to the Company’s proposed business, including, but not limited to, regulations or laws impacting the manufacturing and production methods the Company may utilize. The Company cannot predict the nature of any future laws, regulations, interpretations or applications, nor can the Company determine what effect additional governmental regulations or administrative policies and procedures, if promulgated, could have on the Company’s business.

Uncertainty Regarding the USDA’s Domestic Hemp Production Program.

The Agricultural Improvement Act of 2018 (2018 Farm Bill), tasked the United States Department of Agriculture (USDA) with developing a protocol to approve plans submitted by States and Indian Tribes for the domestic cultivation of industrial hemp (State Plans). It also establishes a Federal plan for cultivators in States or territories of Indian Tribes that do not have their own USDA-approved State Plan. Accordingly, the USDA has issued its ~~Interim~~ Final Rule to establish the domestic hemp production program and to facilitate the cultivation of hemp, as set forth in the 2018 Farm Bill. As of this date, the New York Department of Agriculture and Markets (NYDAM) has not yet formally submitted a State Plan pursuant to the ~~Interim~~ Final Rule. The NYDAM has stated that it will continue to operate under the industrial hemp pilot program provisions of the 2014 Farm Bill, which will remain in effect until ~~October 31~~January 1, ~~2020~~2022. The ~~Interim~~ Final Rule has only established protocols for cultivators of industrial hemp and not processors or manufacturers. Given that Company’s products are reliant on industrial hemp processing and manufacturing and not industrial hemp cultivation, it is unclear how the USDA will handle processors with respect to its licensing structure and such uncertainty could disrupt the Company’s business and result in a material adverse effect on its operations.

Uncertainty Regarding the NYDAM’s Development of a State Plan.

Pursuant to New York Legislation S.6184/A.7680, the NYDAM retains primary regulatory authority over the production and cultivation of industrial hemp within the State of New York. However, pursuant to the 2018 Farm Bill a State Plan must be submitted to the USDA for approval, in order to ensure that the NYDAM’s primary regulatory authority is recognized at the federal level. As of this date, the NYDAM has not yet formally submitted a State Plan and based on public comments issued by the NYDAM it is unclear as to when and how a formal State Plan will be submitted. Until a formal State Plan for New York has been published, submitted and approved by the USDA, it is unclear how the NYDAM will handle any conflicts with federal law which arise over processors and manufacturers of industrial hemp products with respect to its licensing structure and such uncertainty could disrupt the Company’s business and result in a material adverse effect on its operations.

~~The NYDAM’s Current Position on CBD.~~19

~~The~~Uncertainty ~~NYDAM’s~~regarding has issued updated guidance which prohibits the addition of hemp derived CBD into food and beverages, which are intended for human consumption. However, the NYDAM states that hemp derived CBD is allowed for human consumption in the form of dietary supplements. Because Company’s ~~product is included in food, the NYDAM’s updated guidance may limit Company’s~~ ability to ~~source,~~obtain manufacture, and sell the product, or limit the consumer’s ability to purchase and use the product, which could severely impact Company’s revenues and profits. Future regulatory changes or enforcement actions by the NYDAM, with respect to CBD, could also have a ~~materially~~‘cannabinoid ~~adverse~~hemp ~~impact~~retailers” ~~on the business, financial condition, results of operations or prospects of the Company~~license.

15The NYDPH has implemented regulations concerning the processing and retail sale of hemp derived cannabinoids, and pursuant to these regulations, Company is deemed to be operating as a “cannabinoid hemp retailer.” Company has submitted its license application for review by the NYDPH and its application is still being processed. If Company is unable to acquire a cannabinoid hemp retailer license, this could impact Company’s ability to maintain its business operations or subject it to penalties, fees, fines, or other financial consequences.

Uncertainty Regarding the Implementation of New York’s Cannabinoid Hemp Processor and Retailer Licensing Regime.

Recently New York Public Health Law Article 33-B, Regulation of Cannabinoid Hemp and Hemp Extract, was enacted into law. The new regulation which does not become effective until January 1, 2021, will regulate the licensing and oversight of hemp cannabinoid manufacturing, which will include hemp derived CBD and CBG. The new regulations require both cannabinoid hemp retailers and cannabinoid hemp processors to become licensed prior to manufacturing or selling of hemp derived cannabinoid products. The new regulations also allow for the products produced pursuant to the regulatory regime, to be used for human consumption. At this time, it is unclear how the new regulatory regime for cannabinoid hemp processors will impact Company’s manufacturing and retailing partners, and such uncertainty could disrupt the Company’s business and result in a material adverse effect on its operations.

Uncertainty Regarding Production of CBD Products Through the use of White Labeling.

Company operates its CBD product business as a white label operation, however, if Company is deemed to be operating its business without a required manufacturing license this could impact Company’s ability to maintain this business or subject it to significant penalties, fees, fines, or other financial consequences. If Company’s manufacturing and production partners were to lose their license this could also significantly impact Company’s revenues as a result of lost profits as Company sought out new partners or waited for current partners to become compliant.

State and local laws and regulations surrounding the production and manufacture of industrial hemp derived ~~CBD~~cannabinoid products are still in flux as states and local agencies figure out how best to regulate these products. State and local laws may change in unexpected ways that could result in Company’s manufacturing partners being forced to change their products or services, or raise prices, all of which could impact Company’s revenues and prospective profits.

In addition, state or local laws may prohibit the white labeling of industrial hemp derived ~~CBD~~cannabinoid products, which would force ~~Company~~ Company to abandon its current business strategy with regard to Company’s products or rework Company’s current relationships with Company’s partners, which would significantly impact Company’s revenues and prospective profits.

FDA Related Risks regarding CBD and Clinical Trial Requirements and Process

The FDA’s Current Position on CBD.

The 2018 Farm Bill removed industrial hemp and hemp derivatives from the definition of marijuana in the United States Federal Controlled Substances Act (21 U.S.C. § 811) (CSA). However, the 2018 Farm Bill specifically preserved the United States Food and Drug Administration’s (FDA) authority over hemp derived consumer products. The FDA has taken the position that it is currently illegal to put into interstate commerce a food to which cannabidiol (CBD) has been added, or to market CBD as, or in, a dietary supplement. The FDA prohibits these uses of CBD because CBD was the subject of substantial clinical investigations into its potential medical uses before it was added to foods (including dietary supplements), and, separately, because CBD is the active ingredient in an FDA-approved prescription drug product which is used to treat rare, severe forms of epilepsy. The FDA had sought public comments regarding issues surrounding CBD and has not issued any guidance, rules, or regulations regarding the use of CBD in foods, drugs, or cosmetics since closing the comment period. Because Company’s product is included in food, FDA rules and regulations limiting Company’s ability to source, manufacture, and sell the product, or limiting the consumer’s ability to purchase and use the products, could severely impact Company’s revenues and profits. Future regulatory changes or enforcement actions by the FDA, with respect to CBD, could also have a materially adverse impact on the business, financial condition, results of operations or prospects of the Company.

Uncertainty Regarding the FDA’s Potential Position on CBG.

Cannabigerol (CBG) is a cannabinoid which can be lawfully derived from industrial hemp and Company has plans to develop CBG products. The 2018 Farm Bill preserved the FDA’s authority over industrial hemp derived consumer products and as of this date, the FDA has provided no guidance as to how cannabinoids other than CBD shall be regulated under the Food Drug and Cosmetic Act (FD&C Act). Future regulatory changes or enforcement actions by the FDA, with respect to CBG or other hemp derived cannabinoids, could have a materially adverse impact on the business, financial condition, results of operations or prospects of the Company.

Legal Uncertainty Surrounding the Use of Industrial Hemp Derived Δ8 THC.

On August 21, 2020, the United States Drug Enforcement Administration’s (DEA) issued its Interim Final Rule for the Implementation of the Agricultural Improvement Act of 2018 (IFR), “to codify in the DEA regulations the statutory amendments to the Controlled Substances Act (CSA) made by the Agriculture Improvement Act of 2018 (AIA [or 2018 Farm Bill]), regarding the scope of regulatory controls over marihuana, tetrahydrocannabinols, and other marihuana-related constituents.” The IFR further stated that the classification of “synthetic tetrahydrocannabinols” was not impacted by the 2018 Farm Bill, and “synthetic cannabinoids” are still to be considered controlled substances under the CSA. The legal definition of “synthetic cannabinoids” is constantly evolving, and some argue that Δ8-THC could be deemed a controlled substance, given that it is produced via a chemical extraction process with hemp-based materials, typically hemp-derived CBD. Given this regulatory uncertainty, Δ8 THC’s potential classification under the CSA will not be fully understood until additional clarifying statements are issued by the DEA, or a judicial decision on these issues has been rendered. Since the implementation of the IFR, several states have issued bans on the use of industrial hemp derived Δ8 THC in consumer products. Furthermore, the NYDPH recently issued a set of proposed regulations to address the use of industrial hemp derived Δ8 THC and Δ10 THC in cannabinoid hemp products manufactured and sold in New York. These proposed regulations are currently in a public comment period, and it is unclear at this time as to what the final regulations to be implemented will include. Future regulatory changes or enforcement actions by the DEA or state regulators, with respect to Δ8 THC, could have a materially adverse impact on the business, financial condition, results of operations or prospects of the Company.

The FDA Limits the Ability to Discuss the Medical Benefits of CBD.

Under FDA rules it is illegal for companies to make “health claims” or claim that a product has a specific medical benefit, without first getting FDA approval for such claim. The FDA has not recognized any medical benefits derived from CBD, which means that Company is not legally permitted to advertise any potential health claims related to its CBD products. Because of the perception among many consumers that CBD is a health/medicinal product, Company’s inability to make such health claims about its CBD products, may limit Company’s ability to market and sell its product to consumers, which would negatively impact Company’s revenues and profits.

There is no assurance that the FDA will ultimately approve a product for marketing in the United States

We may encounter significant difficulties or costs during the review process. If a product receives marketing approval, the approval may be significantly limited to specific diseases and dosages or the indications for use may otherwise be limited, which could restrict the commercial value of the product. Further, the FDA may require that certain contraindications, warnings or precautions be included in the product labeling or may condition the approval of the NDA on other changes to the proposed labeling, development of adequate controls and specifications, or a commitment to conduct post-market testing or clinical trials and surveillance to monitor the effects of approved products. For example, the FDA may require Phase 4 clinical trials to further assess drug safety and effectiveness and may require testing and surveillance programs to monitor the safety of approved products that have been commercialized. The FDA may also place other conditions on approvals, including the requirement for a risk evaluation and mitigation strategy (“REMS”), to assure the safe use of the drug. If the FDA concludes a REMS is needed, the sponsor of the NDA must submit a proposed REMS; the FDA will not approve the NDA without an approved REMS, if required. A REMS could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries and other risk minimization tools. Any of these limitations on approval or marketing could restrict the commercial promotion, distribution, prescription or dispensing of products. Product approvals may be withdrawn for non-compliance with regulatory requirements or if problems occur following initial marketing.

We are early in our development efforts and currently have no products in clinical trials. If we are unable to clinically develop and ultimately commercialize our product candidates, or experience significant delays in doing so, our business will be materially harmed.

We are early in our development efforts and have no clinical-stage product candidates as of the date of this annual report.

Therefore, our ability to generate product or royalty revenues, which we do not expect will occur for several years, if ever, will depend heavily on our ability to develop and eventually commercialize our product candidate. The positive development of our product candidate will depend on several factors, including the following:

● positive commencement and completion of clinical trials;

● successful preparation of regulatory filings and receipt of marketing approvals from applicable regulatory authorities;

● obtaining and maintaining patent and trade secret protection and potential regulatory exclusivity for our product candidate and protecting our rights in our intellectual property portfolio;

● launching commercial sales of our product, if and when approved for one or more indications, whether alone or in collaboration with others;

● acceptance of the product for one or more indications, if and when approved, by patients, the medical community and third-party payors;

● protection from generic substitution based upon our own or licensed intellectual property rights;

● effectively competing with other therapies;

● obtaining and maintaining adequate reimbursement from healthcare payors; and

● maintaining a continued acceptable safety profile of our product following approval, if any.

If we do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to clinically develop and commercialize all or any of our pharmaceutical line of products, which would materially harm our business.

Clinical drug development involves a lengthy and expensive process, with an uncertain outcome. We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of our product candidate.

The risk of failure for product candidates in clinical development is high. It is impossible to predict when our product candidates will receive regulatory approval for the treatment of any disease, the indication for which is licensed to us. Before obtaining marketing approval from regulatory authorities for the sale of our products, we must conduct one or more clinical trials to demonstrate the safety and efficacy of each product candidate in humans. Clinical testing is expensive, difficult to design and implement, can take many years to complete and is uncertain as to outcome. A failure of one or more clinical trials can occur at any stage of testing. Moreover, the outcome of early clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results. In addition, preclinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that have believed their product candidates performed satisfactorily in clinical trials have nonetheless failed to obtain marketing approval of their products.

We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval or commercialize our product candidate, including:

● regulators or institutional review boards may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site;

● we may experience delays in reaching, or fail to reach, agreement on acceptable clinical trial contracts or clinical trial protocols with prospective trial sites;

● clinical trials of our product candidate may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical trials or abandon product development programs, which would be time consuming and costly;

● the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate or participants may drop out of these clinical trials at a higher rate than we anticipate;

● we may have to suspend or terminate clinical trials of our product candidates for various reasons, including a finding that the participants are being exposed to unacceptable health risks;

● regulators or institutional review boards may require that we or our investigators suspend or terminate clinical research for various reasons, including noncompliance with regulatory requirements or a finding that the participants are being exposed to unacceptable health risks;

● the cost of clinical trials may be greater than we anticipate;

● the supply or quality of materials necessary to conduct clinical trials of our product candidate may be insufficient or inadequate;

● our product candidate may have undesirable side effects or other unexpected characteristics, causing us or our investigators, regulators or institutional review boards to suspend or terminate the trials; and

● interactions with other drugs.

If we are required to conduct additional clinical trials or other testing of our product candidate beyond those that we currently contemplate, if we are unable to complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not positive or are only modestly positive or if there are safety concerns, we may:

● be delayed in obtaining marketing approval for our product candidate for one or more indications;

● not obtain marketing approval at all for one or more indications;

● obtain approval for indications or patient populations that are not as broad as intended or desired;

● obtain approval with labeling that includes significant use or distribution restrictions or safety warnings;

● be subject to additional post-marketing testing requirements; or

● have the product removed from the market after obtaining marketing approval.

Our product development costs will also increase if we experience delays in testing or marketing approvals. We do not know which, if any, of our clinical trials will need to be restructured or will be completed on schedule, or at all. Significant preclinical or clinical trial delays also could shorten any periods during which we may have the right to commercialize our product candidate or allow our competitors to bring products to market before we do and impair our ability to commercialize our product candidate and may harm our business and results of operations.

We rely on third parties to conduct our clinical trials and to assist us with pre-clinical development. If these third parties do not perform as contractually required or expected, we may not be able to obtain regulatory approval for or commercialize our products.

We do not have the ability to independently conduct our pre-clinical and clinical trials for our product candidates, and we must rely on third parties, such as CROs, medical institutions, clinical investigators and contract laboratories to conduct such trials. If these third parties do not successfully carry out their contractual duties or regulatory obligations, meet expected deadlines or need to be replaced, or if the quality or accuracy of the data they obtain is compromised due to the failure to adhere to our clinical protocols or regulatory requirements or for other reasons, our pre-clinical development activities or clinical trials may be extended, delayed, suspended or terminated, and we may not be able to obtain regulatory approval for, or successfully commercialize, our products on a timely basis, if at all. Furthermore, our third-party clinical trial investigators may be delayed in conducting our clinical trials for reasons outside of their control. The occurrence of any of the foregoing may adversely affect our business, operating results and prospects.

Members of our management team lack experience in the pharmaceutical field.

Members of our management team lack experience in the pharmaceutical field, notwithstanding the fact that we have engaged consultants to assist in the development of our pharma line and to assist in the clinical trial process. This lack of full-time management experience may impair our ability to commercialize our pharmaceutical products and attain profitability. We will need to hire or engage managerial personnel with relevant experience in the pharmaceutical field; however, there can be no assurance that such personnel will be available to us or, that once engaged, will be retained by us. Failure to establish and maintain an effective management team with experience in the pharmaceutical field and commercialization of pharmaceuticals products would have a material adverse effect on our business and results of operations.

Federal intellectual property laws may limit Company’s ability to protect its trademarks, names, logos, and other intellectual property

On May 2, 2019, the United States Patent and Trademark Office (USPTO) promulgated Examination Guide 1-19, which provides, among other things, that trademarks for food products, beverage products, dietary supplement products, or pet treat products containing hemp derived CBD (“Consumable Hemp Derived CBD Products”) can be rejected by the USPTO on the basis that the sale of such products in interstate commerce allegedly violates FDA law (see discussion of FDA law above).

Because of the USPTO’s current position, obtaining trademarks for Consumable Hemp Derived CBD Products is problematic, making it difficult to enforce and protect intellectual property relating to Consumable Hemp Derived CBD Products. Company’s product offerings include Consumable Hemp Derived CBD Products. There can be no assurance that all of the steps Company takes to protect such intellectual property will be adequate. In many cases, Company may not have sufficient protection or rights to take sufficient action to protect material intellectual property. If efforts to protect such intellectual property are not adequate, or if any third-party misappropriates or infringes on such intellectual property, whether in print, on the Internet or through other media, the value of the impacted brands may be harmed, which could have a material adverse effect on Company’s prospects, including the failure of such brands and branded products to achieve and maintain market acceptance. Such failure would likely adversely impact Company’s revenue stream, and accordingly, Company’s ability to make distributions to shareholders.

There can be no assurance that third parties will not assert infringement or misappropriation claims against Company, or assert claims that Company’s rights in certain trademarks, service marks, trade dress and other intellectual property assets are invalid or unenforceable. Any such claims could have a material adverse effect on Company’s financial condition as well as its ability to allocate time and effort to other aspects of its business. If Company’s rights in any intellectual property were invalidated or deemed unenforceable, it could permit competing uses of intellectual property by third parties, which, in turn, could lead to a decline in Company’s results of operations. If Company is found to infringe upon a third party’s intellectual property rights, it may be forced to pay damages, be required to develop or adopt non-infringing intellectual property or be obligated to acquire a license to such intellectual property. There could be significant expenses associated with the defense of any infringement, misappropriation, or other third-party claims. Although in the case of intellectual property in respect of which Company has a license, Company may have a right to indemnification from the licensor, Company cannot assure that the financial condition of the licensor will be sufficient to satisfy any licensor indemnification obligation, or that such indemnification obligation would cover lost profits, consequential or other non-direct damages.

New York City has implemented an embargo on food and beverage CBD products.

On July 1, 2019, months after the NYC Department of Heath announced a ban on CBD in foods and beverages (mainly focused on restaurants and baked goods), the updated New York City Health Code now includes an embargo of CBD-infused Edible(s) Products (including packaged products). Company has taken a conservative approach towards the production of its products, including, for example, ensuring that its product manufacturer periodically tests for compliance with the 2018 Farm Bill, in order to ensure that the products are utilizing CBD oils derived from industrial hemp plants and that the products contain 0% THC content. Company remains confident that the current embargo on CBD Edible(s) products will be lifted and/or clarified. However, as a result of this embargo, Company has taken the necessary steps to ensure that its marketing efforts are focused on areas outside of New York City, while still maintaining its New York City (the 5 Boroughs) presence. Similar embargoes and bans have been implemented in other municipalities and jurisdictions, and this trend may continue, making it difficult for Company to conduct a sufficient amount of sales and business and could have a materially adverse impact on the business, financial condition, results of operations or prospects of the Company.

Fraudulent or Illegal Activity by Industrial Hemp Suppliers.

The Company is exposed to the risk that its suppliers of industrial hemp materials may engage in fraudulent or other illegal activity. Misconduct by these parties could include intentional, reckless and/or negligent conduct or disclosure of unauthorized activities to the Company that violates: (i) government regulations; (ii) cultivation standards; or (iii) laws that require the true, complete and accurate reporting of information or data. It may not always be possible for the Company to identify and deter misconduct by its suppliers and other third parties, and the precautions taken by the Company to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting the Company from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. If any such actions are instituted against Company, and it is not successful in defending itself or asserting its rights, those actions could have a significant impact on the Company’s business, including the imposition of civil, criminal and administrative penalties, damages, monetary fines, contractual damages, reputational harm, diminished profits and future earnings, and curtailment of the Company’s operations, any of which could have a material adverse effect on the Company’s business, financial condition, results of operations or prospects.

Potential Federal Legislation Regarding CBD

On January 13, 2020, Representative Collin C. Peterson introduced H.R. 5587, a bill seeking to amend the FD&C Act with respect to the regulation of hemp-derived CBD and substances containing hemp-derived CBD. If enacted into law, H.R. 5587 would consider hemp-derived CBD and substances containing hemp-derived CBD to be dietary supplements under the FD&C Act, resolving ambiguity and providing clear guidance to stakeholders about how to comply with applicable FDA law. However, H.R. 5587 was only recently introduced in the House of Representatives, it is currently in the House Committee on Agriculture, Subcommittee on Biotechnology, Horticulture, and Research, and requires substantial further approvals, including approval of the House of Representatives, the Senate and the President of the United States before being enacted into law, if at all. At this time Company cannot determine what effect these additional governmental regulations, if promulgated, could have on the Company’s business.

Results of Future Clinical Research on Industrial Hemp Derived Cannabinoids.

Research in the U.S. and internationally regarding the medical benefits, viability, safety, efficacy, dosing and social acceptance of industrial hemp or isolated cannabinoids derived from industrial hemp remains in early stages. Future research and clinical trials may prove prior research results to be incorrect, or could raise concerns regarding, and perceptions relating to, industrial hemp and industrial hemp derived cannabinoids. Given these risks, uncertainties and assumptions, prospective shareholders should not place undue reliance on prior research articles and reports. Future research studies and clinical trials may reach negative conclusions regarding the medical benefits, viability, safety, efficacy, dosing, social acceptance or other facts and perceptions related to industrial hemp and industrial hemp derived cannabinoids, which could have a material adverse effect on the demand for the Company’s products with the potential to lead to a material adverse effect on the Company’s business, financial condition, results of operations or prospects.

Product Liability for Industrial Hemp Related Companies.

Industrial hemp companies are subject to strict product liability laws where a Company who sells a defective product to a consumer is subject to liability for any harm that befalls that consumer due to the defect. For example, a Company who sells industrial hemp CBD infused products could be held liable if that product was tainted in the cultivation or manufacturing process or inadequately labeled and a consumer subsequently fell ill. This area of law is unsettled and there is very little statutory or case law regarding industrial hemp and products liability. Under certain circumstances, the Company, or distributors or retailers of its products, may be required to recall or withdraw products. Even if a situation does not necessitate a recall or market withdrawal, product liability claims may be asserted against the Company. If the consumption of any of the products causes, or is alleged to have caused, a health-related illness, the Company may become subject to claims or lawsuits relating to such matters. Even if a product liability claim is unsuccessful, the negative publicity surrounding any assertion that the products caused illness or physical harm could adversely affect the Company’s reputation and brand equity.

Cannabis Industry Risks

~~THIS~~AT THIS TIME COMPANY IS NOT ENGAGED IN CANNABIS ACTIVITIES. COMPANY IS CURRENTLY ONLY ENGAGED IN THE SALE AND DEVELOPMENT OF PRODUCTS THAT CONTAIN INDUSTRIAL HEMP DERIVED CANNABINOIDS. HOWEVER, TO THE EXTENT THAT COMPANY MAY DECIDE TO SUBSEQUENTLY OFFER PRODUCTS THAT CONTAIN CANNABINOIDS DERIVED FROM CANNABIS, THE RELEVANT CANNABIS INDUSTRY RISKS ARE SET FORTH BELOW:

Federal regulation and enforcement may adversely affect the implementation of cannabis laws and regulations may negatively impact Company’s business operations, revenues and profits.

Currently, there are 33 states in the United States, plus the District of Columbia, that have laws and/or regulations that recognize, in one form or another, medical benefits or other uses for cannabis or cannabis related products. These states have also passed laws governing the use and sale of cannabis products and others are considering similar legislation.

Nonetheless, the possession, use, cultivation, manufacturing, sale distribution and transfer of cannabis is illegal under Federal Law. Cannabis is classified as a Schedule I drug, which is viewed as having a high potential for abuse and no currently accepted use for medical treatment in the U.S. and lacking acceptable safety for use under medical supervision.

The United States Supreme Court has ruled that the federal government has the right to regulate and criminalize cannabis, even for medical purposes, and thus federal law criminalizing the use of cannabis preempts state laws that legalize its use (U.S. v. Oakland Cannabis Buyers’ Coop., and Gonzales v. Raich). Although the Obama administration stated that it is not an efficient use of resources to direct federal law enforcement agencies to prosecute those lawfully abiding by state-designated laws allowing the use and distribution of medical and adult-use cannabis, and Congress passed the Consolidated and Further Continuing Appropriations Act, 2019, eliminating any application of the federal budget toward the prosecution of individuals or entities operating in compliance with state cannabis laws, there is no guarantee that the Trump administration will not change the current stated policy regarding the low priority enforcement of federal laws in states where cannabis has been legalized under state law. Several members of President Trump’s cabinet have made statements indicating they are opposed to legalization efforts.

In January 2018, former Attorney General Jeff Sessions rescinded the 2013 Obama-era Cole Memo which had previously indicated that resources would not be directed for federal enforcement activity, including civil enforcement and criminal investigations and prosecutions related to cannabis activities. This has created significant uncertainty as to the enforcement policies and priorities of the federal government and agencies against cannabis operators and businesses in the cannabis industry. Although Jeff Sessions has been replaced by President Trump with Attorney General William Barr, there is still very little clarity as to how President Trump, or Attorney General Barr, will enforce federal law or how they will deal with states that have legalized medical or adult-use cannabis. Even for businesses compliant with state laws, cannabis-related investments remain a risk under federal law. As such, any investment into a commercial cannabis business is laden with risk under federal law, and an increased amount of risk due to former Attorney General Sessions actions against the cannabis industry. Any change in the federal government’s enforcement of federal laws could cause significant damage to Company and its growth prospects.

As the possession, cultivation, use and distribution of cannabis is illegal under the CSA, any person engaged in such activities may be deemed to be conducting or aiding and abetting illegal activities. As a result, Company and possibly certain beneficial owners of its equity may be subject to enforcement actions and/or prosecution by law enforcement authorities. Strict enforcement of the CSA by the DOJ would materially and adversely affect Company’s ability to generate funds for distributions to the holders of stock. Additionally, any action taken against Company for conducting or aiding and abetting illegal activities may force Company to cease operations and investors could lose their entire investment. In any such action, Company’s assets may be subject to forfeiture and investors could additionally face fines, penalties or the possibility of criminal prosecution. Companies that engage in any form of commerce in the cannabis industry and individuals investing in a cannabis business may be subject to federal criminal prosecution along with civil fines and penalties. The federal, and in some cases state, law enforcement authorities have frequently investigated and/or closed dispensaries, grow operators, manufacturers, and other cannabis-related businesses. Federal enforcement would have a material adverse effect on the business and operations of the Company and could lead to dissolution, asset forfeiture and total loss of investment in the Company.

Variations in state and local regulation, and enforcement in states that have legalized cannabis, may restrict cannabis-related activities, which may negatively impact Company’s revenues and prospective profits.

Many state and local cannabis laws are relatively new and there is a relatively small body of interpretive guidance and case law available to understand how certain laws, rules and regulations will be interpreted or applied by enforcement agencies or the courts. Additionally, the state and local licensing regulations are interdependent but, in part due to the variability of applicable local rules and differences in their effective administration, the results of such interdependency are often inefficient and may be impossible to comply with. As a result, Company’s business may be required to operate in a grey area, which subjects Company to the risk that it will unintentionally violate laws, rules or regulations.

The Company must be prepared for possible changes in laws and regulations which could seriously impact the Company’s business. The Company will incur ongoing costs and obligations related to regulatory compliance and failure to do so may result in additional costs for corrective measures, penalties, or in restrictions on the Company’s operations. In addition, changes in regulations, more vigorous enforcement thereof, or other unanticipated events could require extensive changes to the Company’s operations, increased compliance costs, or give rise to material liabilities, which could have a material adverse effect on the business, results of operations, and financial condition of the Company. Company cannot predict the nature of any future laws, regulations, interpretations, or applications, nor can it determine what effect additional governmental regulations or administrative policies and procedures, when and if promulgated, could have on its business. Accordingly, the unfavorable enforcement or change in applicable state or local laws could materially and adversely affect Company’s ability to make payments to the holders of Company’s stock and could result in the loss of investment in Company.

These state and local legal regimes often require companies to apply for and be awarded a license in order to operate a cannabis business operation. Company plans to operate its potential cannabis business as a white label operation. However, if such potential operations are deemed to be operating without a required license this could impact Company’s ability to engage in this business model or potentially subject Company to significant penalties, fees, fines, or other financial consequences.

Laws regarding the transportation of Cannabis

Laws related to transportation of cannabis may significantly impact Company’s ability to get products to market or may raise the cost of doing so, which would impact Company’s revenue and potential profits. Both state and federal law make it illegal to transport cannabis products across state lines. Any accidental or intentional transportation of Company’s products across state lines could, therefore, result in significant consequences including loss of a state issues license or permit, financial penalties, seizure of Company’s products, and prosecution for the illegal transportation of a Schedule I substance. These consequences may impact Company’s revenues, potential profits, or ability to continue operating in this line of business.

Federal intellectual property laws may limit Company’s ability to protect Company’s trademarks, names, logos, and other intellectual property

The United States Patent and Trademark Office does not provide trademark protection for cannabis or cannabis-related marks, making it difficult to enforce and protect intellectual property. It is possible to obtain trademarks for brands used in the cannabis industry, but only on non-cannabis goods. Some states may issue state trademarks for cannabis-related products, but state trademarks provide significantly less protection than federal trademarks. Patents are also very difficult to receive in the cannabis industry and require complex legal and scientific questions. There can be no assurance that all of the steps Company takes to protect such intellectual property will be adequate. In many cases, Company may not have sufficient protection or rights to take sufficient action to protect material intellectual property. If efforts to protect such intellectual property are not adequate, or if any third-party misappropriates or infringes on such intellectual property, whether in print, on the Internet or through other media, the value of the impacted brands may be harmed, which could have a material adverse effect on Company’s prospects, including the failure of such brands and branded products to achieve and maintain market acceptance. Such failure would likely adversely impact Company’s revenue stream, and accordingly, Company’s ability to make distributions to shareholders.

Tax laws related to cannabis may impact Company’s ability to generate revenue or potential profits.

Section 280E of the Internal Revenue Code prohibits cannabis businesses from deducting their ordinary and necessary business expenses, except for some “costs of goods sold”, forcing cannabis businesses to pay higher effective federal tax rates than similar companies in other industries. The effective tax rate on a cannabis business depends on how large its ratio of nondeductible expenses is to its total revenues.

State tax laws are also changing. Even though state taxes are already high, many local jurisdictions are imposing heavy additional taxes either as a disincentive for cannabis companies to operate there or in order to cash in on the growing number of cannabis companies paying taxes. These taxes may overwhelm Company’s partner companies causing them to go out of business or raise prices for their services, which in turn may impact Company’s revenues and profits by forcing us to find different partners in more tax friendly areas or pay higher prices.

Collectively, federal state and local taxes will place a substantial burden on Company’s revenue and could make its business model economically unfeasible. Accordingly, Company may not be able to make payments to the holders of its stock, in which case, investors may lose the value of their investment.

Company may have difficulty accessing the service of banks, which may make it difficult for Company to operate.

In February 2014, the FinCEN bureau of the U.S. Treasury Department issued guidance (which is not law) with respect to financial institutions providing banking services to cannabis business, including burdensome due diligence expectations and reporting requirements. This guidance does not provide any safe harbors or legal defenses from examination or regulatory or criminal enforcement actions by the DOJ, FinCEN or other federal regulators. Thus, most banks and other financial institutions in the United States do not appear to be comfortable providing banking services to cannabis-related businesses, or relying on this guidance, which can be amended or revoked at any time by the Trump Administration. In addition to the foregoing, banks may refuse to process debit card payments and credit card companies generally refuse to process credit card payments for cannabis-related businesses. As a result, the Company may have limited or no access to banking or other financial services in the United States. In addition, federal money laundering statutes and Bank Secrecy Act regulations discourage financial institutions from working with any organization that sells a controlled substance, regardless of whether the state it resides in permits cannabis sales. While the United States Congress is contemplating the SAFE Act, the passage of which would permit ‎commercial banks to offer services to cannabis companies that are in compliance with state law, if ‎Congress fails to pass the SAFE Act, the Company’s inability, or limitations on the Company’s ability, to open or maintain bank accounts, obtain other banking services and/or accept credit card and debit card payments may make it difficult for the Company to operate and conduct its business as planned or to operate efficiently.

Due to the federal regulatory environment, including the Bank Secrecy Act (the “BSA”), banks in the United States often refuse to open or maintain accounts for companies that operate in the cannabis industry. The BSA also requires that banks file with the FinCEN suspicious activity reports (“SARs”) to provide FinCEN with information about transactions that may show participation in illegal activities including money laundering or funding of terrorist activities. To satisfy their legal obligations, banks often question transactions, including large cash transactions or transactions involving money orders. Typically, the account holder is not informed that the bank has filed a SAR with respect to any transaction. A bank that is uncomfortable with a transaction may file a SAR and/or close the accounts in question. As a result, companies in the cannabis industry, including Company, are at a risk of being non-bankable. An inability to make full, or any use of bank account services would impact management of Company’s operations and could have a material adverse effect on its business, financial condition and/or results of operations.

If Company incurs substantial liability from litigation, complaints, or enforcement actions, Company’s financial condition could suffer.

Company’s participation in the cannabis industry may lead to litigation, formal or informal complaints, enforcement actions, and inquiries by various federal, state, or local governmental authorities against us. Litigation, complaints, and enforcement actions could consume considerable amounts of financial and other corporate resources, which could have a negative impact on Company’s sales, revenue, profitability, and growth prospects. Company has not been, and are not currently, subject to any material litigation, complaint, or enforcement action regarding cannabis or cannabis products (or otherwise) brought by any federal, state, or local governmental authority. However, should Company become the subject of litigation, the cost to defend such litigation may be significant and may require a diversion of Company’s resources. There also may be adverse publicity associated with litigation that could negatively affect customer perception of Company’s business, regardless of whether the allegations are valid or whether Company is ultimately found liable. Company does not currently carry litigation liability insurance, and, therefore, the Company could be significantly financially burdened by legal claims, litigation or administrative proceedings against us.

Prospective customers may be deterred from doing business with a company with a significant nationwide e-commerce presence because of fears of federal or state enforcement of laws prohibiting possession and sale of medical or adult-use cannabis.

Company’s website is visible in jurisdictions where medicinal and adult use of cannabis is not permitted and, as a result, Company may be found to be violating the laws of those jurisdictions. Having to block access to Company’s website in certain jurisdictions may negatively impact Company’s visibility and ability to secure partnerships with companies or engage consumers in those areas.

Third-Party Service Providers

As a result of any adverse change to the approach in enforcement of the U.S. cannabis laws, adverse regulatory or political changes, additional scrutiny by regulatory authorities, adverse changes in the public perception in respect to the consumption of cannabis or otherwise, third-party service providers to the Company could suspend or withdraw their services, which may have a material adverse effect on the business, revenues, operating results, financial condition or prospects of the Company.

Enforceability of Contracts

Since cannabis is illegal at a federal level, judges in multiple U.S. states have on several occasions refused to enforce contracts for the repayment of money when the loan was used in connection with activities that violate federal law, even if there is no violation of state law. Therefore, there is uncertainty that the Company will be able to legally enforce its material agreements

Ability to file for Bankruptcy

Federal courts in the United States have held that cannabis businesses are not able to receive protection under bankruptcy laws. It has also been held that owners of cannabis businesses seeking personal bankruptcy protection will also be unable to take advantage of filing for bankruptcy. Therefore, in the event Company faces financial trouble, it will not be possible to file for bankruptcy protection without a drastic change in federal law.

Our business and financial performance may be adversely affected by downturns in the target markets that we serve or reduced demand for the types of products we sell.

Demand for the products we sell can be affected by general economic conditions as well as product-use trends in our target markets. These changes may result in decreased demand for our products. The occurrence of these conditions is beyond our ability to control and, when they occur, they may have a significant impact on our sales and results of operations.

We may be classified as an inadvertent investment company.

We are not primarily engaged in the business of investing, reinvesting, or trading in securities, and we do not hold ourselves out as being engaged in those activities. Under the Investment Company Act of 1940, as amended (the “1940 Act”), however, a company may be deemed an investment company under section 3(a)(1)(C) of the 1940 Act if the value of its investment securities is more than 40% of its total assets (exclusive of government securities and cash items) on a consolidated basis.

As a result of our December 13, 2017 purchase of shares of Vistagen Therapeutics Inc. (NASDAQ: VTGN), and the subsequent investments ~~the~~ the Company has made in public and privately held companies in the subsequent period, the investment securities presently held by us exceeds 40% of our total assets, exclusive of cash items and, accordingly, we are currently an inadvertent investment company. As of March 31, ~~2020~~ 2021, the Company held common stock in one publicly traded company and warrants exercisable for common stock in two publicly traded companies. The Company also has investments recorded at cost in ~~two~~four private companies. An ~~inadvertent investment company can avoid being classified as an investment company if it can rely on one~~ As of ~~the~~June ~~exclusions under~~25, ~~the~~2021 ~~1940~~and ~~Act.~~subsequent ~~One~~to ~~such~~March ~~exclusion~~31, ~~Rule 3a-2 under the 1940 Act~~2021, ~~allows an inadvertent investment company a grace period of one year from~~ the ~~earlier~~Company ofhas ~~(a)~~purchased ~~the date on which an issuer owns~~ securities, ~~and/or~~warrants ~~cash having a value exceeding 50% of the issuer’s total assets on either a consolidated~~ or ~~unconsolidated~~options ~~basis~~in ~~and~~eight ~~(b)~~different ~~the date on which an issuer owns or proposes~~public tocompanies ~~acquire~~at ~~investment securities having~~ a ~~value~~cost ~~exceeding 40%~~ of ~~the~~$809,960 ~~value~~and ofsold ~~such~~shares ~~issuer’s total assets (exclusive~~ of ~~government securities~~four ~~and~~different ~~cash~~companies ~~items)~~receiving onproceeds ~~an unconsolidated basis. We have taken actions to cause the investment securities held by us to be less than 40%~~ of ~~our total assets and will continue to evaluate other feasible actions towards this end~~$1, ~~which may include acquiring assets with our cash on hand~~379, ~~consummating a significant merger/acquisition transaction, or liquidating our investment securities~~954. ~~We also may seek a no-action letter from the SEC if we are unable to acquire sufficient non-securities assets or liquidate sufficient investment securities in a timely manner.~~

An inadvertent investment company can avoid being classified as an investment company if it can rely on one of the exclusions under the 1940 Act. One such exclusion, Rule 3a-2 under the 1940 Act, allows an inadvertent investment company a grace period of one year from the earlier of (a) the date on which an issuer owns securities and/or cash having a value exceeding 50% of the issuer’s total assets on either a consolidated or unconsolidated basis and (b) the date on which an issuer owns or proposes to acquire investment securities having a value exceeding 40% of the value of such issuer’s total assets (exclusive of government securities and cash items) on an unconsolidated basis. We have taken actions to cause the investment securities held by us to be less than 40% of our total assets and will continue to evaluate other feasible actions towards this end, which may include acquiring assets with our cash on hand, consummating a significant merger/acquisition transaction, or liquidating our investment securities. We also may seek a no-action letter from the SEC if we are unable to acquire sufficient non-securities assets or liquidate sufficient investment securities in a timely manner.

As Rule 3a-2 is available to a company no more than once every three years, and assuming no other exclusion were available to us, we would have to keep within the 40% limit for at least three years after we cease being an inadvertent investment company. This may limit our ability to make certain investments or enter into joint ventures that could otherwise have a positive impact on our earnings. In any event, we do not intend to become an investment company engaged in the business of investing and trading securities.

Classification as an investment company under the 1940 Act requires registration with the SEC. If an investment company fails to register, it would have to stop doing almost all business, and its contracts would become voidable. Registration is time consuming and restrictive and would require a restructuring of our operations, and we would be very constrained in the kind of business we could do as a registered investment company. Further, we would become subject to substantial regulation concerning management, operations, transactions with affiliated persons and portfolio composition, and would need to file reports under the 1940 Act regime. The cost of such compliance would result in the Company incurring substantial additional expenses and could result in the complete cessation of our operations, and the failure to register if required would have a materially adverse impact to conduct our operations.

Risks relating to our exposure to equity securities of other companies in which we are currently invested.

We are not primarily engaged in the business of investing, reinvesting, or trading in securities, and we do not hold ourselves out as being engaged in those activities; however, the Company has purchased securities of certain publicly traded and privately held companies and continue to hold a number of the securities obtained as part of such transactions, primarily in the form of equity or equity derivative securities. These investments carry risk of partial or total loss, as with any such investment of this kind, and we could lose all or some of the cash we have utilized in making such investments. We generally monitor the Company’s investments to keep abreast of the investments and positions, but do not portend to actively trade in these securities and we do not have broker-dealers daily monitoring our investments to take positions in the event of market swings or fluctuations, whether on the upside or downside; hence, these investments bear certain risks of loss or failure to attain maximum gain.

The Company has multiple convertible and other notes having cross default provisions.

Multiple notes issued by the Company contain provisions where if the Company shall have defaulted on or breached any term of any other note of similar debt instrument into which the Company has entered and failed to cure such default within the appropriate grace period would be considered in default of all such convertible note instruments containing such default clauses. Should the Company for some reason default on one of its debt instruments, exercisable securities or convertible notes, if those instruments are not promptly cured other debt instruments or agreements could be caused, claimed or deemed to be in default, significantly increasing the principal amounts, amount of stock issuable and calculated interest rates thereunder. This could cause our stock price to decrease significantly, result in substantial dilution or cause us the inability to use the maximum or any of the equity credit line with Tangiers, which could materially impair our ability to execute our business plan or be able to fund operations.

Because we continue to develop and commercialize new products, we expect to incur significant additional operating losses.

Although we have commercialized a number of our products, we continue to develop new products and product lines, and, therefore, we expect to incur substantial additional operating expenses over the next several years as our research, development, and new business venture activities increase, including in connection with the potential to develop a pharmaceutical line of products through its subsidiary, Tauriga Pharma Corp., and the concomitant costs and expenses of such new business endeavors. The amount of our future losses and when, if ever, we will achieve profitability are uncertain. We remain early in our sales and marketing efforts of Tauri-Gum^TMand Tauri-Gummies^TMwhich has resulted in commercial revenue but there is no guarantee that we can generate sufficient revenue to sustain operations or achieve profitability. Our ability to generate revenue and achieve profitability will depend on, among other things, the following:

	●	realizing revenue from our distribution arrangements regarding our products;

	●	establishing more substantial sales and marketing arrangements, either alone or with additional third parties; and

	●	raising sufficient funds to finance our activities, or on terms that are acceptable.

We might not succeed at all, or at any, of these undertakings. If we are unsuccessful at some or all of these undertakings, our business, prospects, and results of operations may be materially adversely affected.

We have few distribution agreements on which we are highly dependent. These agreements have no performance requirements or in some cases terms under which agreed responsibilities will be carried out.

Since the launch of our Tauri-GumTM product line, the Company has entered into multiple non-exclusive distribution agreements. . ~~These~~Despite the fact that the Company has expanded into e-commerce sales of its products, and continues to see increased revenues from its e-commerce platform, our existing distribution agreements are a ~~critical~~significant component in the Company’s success in generating sufficient sales related cash flow to fund ongoing operations. These contracts are relationship based and involve a high degree of trust that the distributor will achieve positive results. However, under these agreements, the Company would have no recourse against distributors if sufficient results were not achieved with regard to amount of stock or cash paid to distributors. These distributors could additionally not perform at all under these agreements and even walk away entirely.

2330

The Company has only one manufacturer/supplier of its product in a highly regulated industry.

In 2019, the Company entered into a comprehensive manufacturing agreement with Per Os Bio to bring to market a white label CBD Oil infused chewing gum product line to be sold and marketed under the name Tauri-Gum^TM and Tauri-Gummies^TM. If for some reason, there was a disruption with our supplier or this manufacturer for any reason at all, it could have a dramatic impact on the Company’s ability to continue to generate revenue, or could cost the Company a significant amount of capital and time to re-establish our manufacturing with another manufacturer and/or supplier, and to obtain applicable certifications surrounding our Company products.

The Company has recently entered a new line of business which is highly competitive and while it is largely unregulated today, it may be highly regulated in the future.

Entering a new line of business has many risks, including obtaining sufficient capital to cover startup and other expenses and to continue to fund operations until sales are sufficient to fund and/or expand ongoing operations. A new business line may never generate significant revenues, bring products to market or have enough sales to be profitable, as the case may be. With respect to any new line of business, including our entry into the CBD/CBG lines of products, we may have competitors that are better established in the market, have greater experience with such line of business or have greater resources than we do. We anticipate that products will be developed for and distributed to the retail market, but there can be no guaranty that sufficient revenue to support operations will ever be generated. Furthermore, we have limited experience in marketing consumer products, including chewing gum products, and may have limited experience with respect to any other line of business we may enter into as we seek to expand our operations. Due to this competition, there is no assurance that we will not encounter difficulties in obtaining revenues and market share or in the positioning of our products. There are no assurances that competition in our respective industries will not lead to reduced prices for our products. If we are unable to successfully compete with existing companies and new entrants to the market this will have a negative impact on our business and financial condition.

Although we believe that our products and processes do not and will not infringe upon the patents or violate the proprietary rights of others, it is possible such infringement or violation has occurred or may occur, which could have a material adverse effect on our business.

We are not aware of any infringement by us of any person’s or entity’s intellectual property rights. In the event that products we sell or processes we employ are deemed to infringe upon the patents or proprietary rights of others, we could be required to modify our products or processes or obtain a license for the manufacture and/or sale of such products or processes or cease selling such products or employing such processes. In such event, there can be no assurance that we would be able to do so in a timely manner, upon acceptable terms and conditions, or at all, and the failure to do any of the foregoing could have a material adverse effect upon our business.

There can be no assurance that we will have the financial or other resources necessary to enforce or defend a patent infringement or proprietary rights violation action. If our products or processes are deemed to infringe or likely to infringe upon the patents or proprietary rights of others, we could be subject to injunctive relief and, under certain circumstances, become liable for damages, which could also have a material adverse effect on our business and our financial condition.

Regulations are constantly changing, and in the future our business may be subject to additional regulations that increase our compliance costs.

We believe that we understand the current laws and regulations to which our existing products will be subject in the future. However, federal, state and foreign laws and regulations relating to the sale of our products are subject to future changes, as are administrative interpretations of regulatory agencies. If we fail to comply with such federal, state or foreign laws or regulations, we may fail to obtain regulatory approval for our products and, if we have already obtained regulatory approval, we could be subject to enforcement actions, including injunctions preventing us from conducting our business, withdrawal of clearances or approvals and civil and criminal penalties. In the event that federal, state, and foreign laws and regulations change, we may need to incur additional costs to seek government approvals. If we are slow or unable to adapt to changes in existing regulatory requirements or the promulgation of new regulatory requirements or policies, we or our licensees may lose marketing approval for our products which will impact our ability to conduct business in the future.

On May 31, 2019, the FDA held public hearings to obtain scientific data and information about the safety, manufacturing, product quality, marketing, labeling, and sale of products containing cannabis or cannabis-derived compounds, including CBD. The hearing comes approximately five months after the Farm Bill, went into effect and removed industrial hemp from the Schedule I prohibition under the CSA (industrial hemp means cannabis plants and derivatives that contain no more than 0.3 percent tetrahydrocannabinol, or THC, on a dry weight basis).

2431

Though the Farm Bill removed industrial hemp from the Schedule I list, the Farm Bill preserved the regulatory authority of the FDA over cannabis and cannabis-derived compounds used in food and pharmaceutical products under the Federal Food, Drug, and Cosmetic Act (FD&C Act) and section 351 of the Public Health Service Act. The FDA has been clear that it intends to use this authority to regulate cannabis and cannabis-derived products, including CBD, in the same manner as any other food or drug ingredient. As part of the FDA hearing, the agency had requested comments by July 2, 2019 regarding any health and safety risks of CBD use, and how products containing CBD are currently produced and marketed, which comment period was completed on July 16, 2019. As of the date hereof, the FDA has taken the position that it is unlawful to put into interstate commerce food products containing hemp derived CBD, or to market CBD as, or in, a dietary supplement. Furthermore, since the closure of the FDA hearings on this issue, some state and city agencies have issued a ban on the sale of any food or beverages containing CBD. H.R. 5587, a newly introduced legislative effort at the federal level, seeks to consider hemp-derived CBD and substances containing hemp-derived CBD to be dietary supplements under the FD&C Act, which would resolve ambiguity and provide clear guidance to stakeholders about how to comply with applicable FDA law. However, H.R. 5587 was only recently introduced in the House of Representatives, and is in its infancy, requiring substantial further approvals, including approval of the House of Representatives, the Senate and the President of the United States before being enacted into law, if at all.

In addition, with respect to Company’s developing CBG product line, the FDA has provided no guidance as to how cannabinoids other than CBD (sch as CBG) shall be regulated under the FD&C Act, and it is unclear at this time how such potential regulation could affect the results of the operations or prospects of the Company.

Any subsequent regulations issued by the FDA and/or legislation passed by Congress, state or local jurisdictions can have an effect on our manufacture, supplier and our product.

If we infringe upon the rights of third parties, we could be prevented from selling products and forced to pay damages and defend against litigation.

If our products, methods, processes and other technologies infringe the proprietary rights of other parties, we could incur substantial costs and we may be required to:

	●	obtain licenses, which may not be available on commercially reasonable terms, if at all;

	●	abandon an infringing product candidate;

	●	redesign our product candidates or processes to avoid infringement;

	●	cease usage of the subject matter claimed in the patents held by others;

	●	pay damages; and/or

	●	defend litigation or administrative proceedings which may be costly regardless of outcome, and which could result in a substantial diversion of our financial and management resources.

Any of these events could substantially harm our earnings, financial condition, stock price, operations and our prospects for success.

We rely solely on two key officers, our directors and consultants and losing them would harm the business.

We are highly dependent on our officers, consultants, advisors and directors. We do not have “key person” life insurance policy for our Chief Executive Officer. If we are unable to obtain additional funding, we will be unable to meet our current and future compensation obligations to such employees and consultants. In light of the foregoing, we are at risk that one or more of our consultants or employees may leave our company for other opportunities where there is no concern about such employers fulfilling their compensation obligations, or for other reasons. The loss of the technical knowledge and management and industry expertise of any of our key personnel could result in delays in product development, loss of customers and sales and diversion of management resources, which could adversely affect our results of operations.

If we are unable to attract, train and retain highly qualified personnel, the quality of our services may decline and we may not successfully execute our internal growth strategies.

Our success will depend in large part upon our ability to attract, train, motivate and retain highly skilled and experienced employees in the areas of business into which we expand, including technical personnel. Qualified technical employees periodically are in great demand and may be unavailable in the time frame required to satisfy our operating requirements. Expansion of our business could further require us to employ additional highly skilled technical personnel.

There can be no assurance that we will be able to attract and retain sufficient numbers of highly skilled technical employees in the future. The loss of personnel or our inability to hire or retain sufficient personnel at competitive rates of compensation could impair our ability to develop our products or services or secure and complete customer engagements and could harm our business.

If we do not effectively manage changes in our business, these changes could place a significant strain on our management and operations.

Our ability to grow successfully requires an effective planning and management process. The expansion and growth of our business could place a significant strain on our management systems, infrastructure and other resources. To manage our growth successfully, we must continue to improve and expand our systems and infrastructure in a timely and efficient manner. Our controls, systems, procedures and resources are currently not adequate to support a changing and growing company. If our management fails to respond effectively to changes and growth in our business, including acquisitions or growth of our line of Tauri-Gum^TM and Tauri-Gummies^TMproduct lines of business, there could be a material adverse effect on our business, financial condition, results of operations and future prospects.

We may be unable to identify additional operating businesses or assets, and even if we do, we may be unable to finance such an acquisition.

Our strategies ultimately include making significant investments in sales and marketing programs, either directly or through distributors, to achieve revenue growth and margin improvement targets. If we do not achieve the expected benefits from these investments or otherwise fail to execute on our strategic initiatives, we may not achieve the growth improvement we are targeting, and our results of operations may be adversely affected. We may also fail to secure the capital necessary to make these investments, which will hinder our growth.

In addition, as part of our strategy for growth, we may make acquisitions, enter into strategic alliances such as joint ventures and joint development agreements or other strategic transactions. However, we may not be able to identify suitable acquisition or other strategic partner candidates, complete acquisitions or integrate acquisitions successfully, and our strategic alliances may not prove to be successful. In this regard, acquisitions and other strategic transactions involve numerous risks, including difficulties in the integration of the operations, technologies, services and products of the acquired companies and the diversion of management’s attention from other business concerns. Although we will endeavor to evaluate the risks inherent in any particular transaction, there can be no assurance that we will properly ascertain all such risks. In addition, acquisitions and other strategic transactions could result in the incurrence of substantial additional indebtedness and other expenses or in potentially dilutive issuances of equity securities. Even if we identify assets, transactions or additional lines of business, we may have insufficient liquidity to be able to complete such a transaction. There can be no assurance that difficulties encountered with such transaction(s) will not have a material adverse effect on our business, financial condition and results of operations.

We do not have long experience in building significant sales, marketing or distribution operations and will need to expand our expertise in these areas.

While we have recently been conducting a material amount of e-commerce sales and marketing, and in 2019 had begun our other sales, marketing or distribution operations in connection with the commercialization of our products, we will continue to need to develop and expand our expertise in these areas. To increase internal sales, distribution and marketing expertise and be able to conduct these operations, we would have to invest significant amounts of financial and management resources. In developing these functions ourselves, we could face a number of risks, including:

	●	we may not be able to attract and build an effective marketing or sales force; and

	●	the cost of establishing, training and providing regulatory oversight for a marketing or sales force may be substantial.

We experienced, and continue to experience, changes in its operations, which has placed, and will continue to place, significant demands on its management, operational and financial infrastructure.

If the Company does not effectively manage its growth, the quality of its products and services could suffer, which could negatively affect the Company’s brand and operating results. To effectively manage this growth, the Company will need to continue to improve its operational, financial and management controls and its reporting systems and procedures. Failure to implement these improvements could hurt the Company’s ability to manage its growth and financial position.

We may not be able to effectively manage our growth or improve our operational, financial, and management information systems, which would impair our results of operations.

Our ability to grow successfully requires an effective planning and management process. In the near term, we intend to expand the scope of our operations activities significantly. If we are successful in executing our business plan, we will experience growth in our business that could place a significant strain on our business operations, finances, management, and other resources. The factors that may place strain on our resources include, but are not limited to, the following:

●

The need for continued development of our financial and information management systems;

	●	The need to manage strategic relationships and agreements with manufacturers, distributors, customers, and partners; and

	●	Difficulties in hiring and retaining skilled management, technical, and other personnel necessary to support and manage our business.

Additionally, our strategy envisions a period of growth that may impose a significant burden on our administrative, infrastructure and operational resources. Our ability to effectively manage growth will require us to substantially and timely expand the capabilities of our administrative and operational resources and to attract, train, manage, and retain qualified management and/or other personnel. There can be no assurance that we will be successful in recruiting and retaining new employees or retaining existing employees.

We cannot provide assurances that our management will be able to manage this growth effectively, efficiently or in a timely manner. Our failure to successfully manage growth could result in our sales not increasing commensurately with capital investments or otherwise materially adversely affecting our business, financial condition, results of operations or future prospects. Our controls, systems, procedures and resources are currently not adequate to support a changing and growing company.

We are and will be dependent on the popularity of consumer acceptance of our product lines.

Our ability to generate revenue and be successful in the implementation of our business plan is dependent on consumer acceptance and demand of our product lines. Acceptance of our products will depend on several factors, including availability, cost, consumer familiarity of product benefits, brand recognition, convenience, effectiveness, safety, and reliability. If customers do not accept our products, or if we fail to meet customers’ needs and expectations adequately, our ability to continue generating revenues could be reduced or otherwise materially impacted.

Risks Related to Our Common Stock

We may need to finance our future cash needs through public or private equity offerings, debt financings or corporate collaboration and licensing arrangements. Any additional funds that we obtain may not be on terms favorable to us or our stockholders and may require us to relinquish valuable rights.

As of our most recent year ended March 31, ~~2020~~2021, we had $549,~~348~~826 of available cash as well as $~~101~~1,~~200~~ 246,050 held in trading securities at fair market value in addition to 320,000 total warrants at a strike price of $1.50 per share. Since these are not publicly traded, the Company has not recognized the value of these warrants as they are not liquid. We will need to raise additional funds or liquidate the remainder of our marketable securities to pay outstanding vendor invoices and execute our business plan. Our future cash flows depend on our ability to market and sell our common stock and to enter into licensing arrangements. There can be no assurance that we will have sufficient funds to execute our business plan or complete a strategic transaction, or that additional funds will be available when needed ~~from~~ from any source or, if available, will be available on terms that are acceptable to us.

We cannot guarantee that we will generate significate revenues from our products in the near future. Therefore, for the foreseeable future, we may have to fund all or most of our operations and capital expenditures from cash on hand, public or private equity offerings, debt financings, bank credit facilities, other borrowings (including borrowings from our officers and directors) or corporate collaboration and licensing arrangements. We will need to raise additional funds if we choose to expand our product development efforts more rapidly than we presently anticipate.

If we seek to sell additional equity or debt securities or enter into a corporate collaboration or licensing arrangement, we may not obtain favorable terms for us and/or our stockholders or be able to raise any capital at all, all of which could result in a material adverse effect on our business and results of operations. The sale of additional equity or debt securities, if convertible, could result in dilution to our stockholders. The incurrence of indebtedness would result in increased fixed obligations and could also result in covenants that would restrict our operations. Raising additional funds through collaboration or licensing arrangements with third parties may require us to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates, or to grant licenses on terms that may not be favorable to us or our stockholders. In addition, we could be forced to discontinue product development, reduce or forego sales and marketing efforts and forego attractive business opportunities, all of which could have an adverse impact on our business and results of operations.

The sale of our stock could encourage short sales by third parties, which could contribute to the future decline of our stock price.

In many circumstances, the provision of financing based on the distribution of equity for companies that are traded on the OTCQB has the potential to cause a significant downward pressure on the price of common stock. This is especially the case if the shares being placed into the market exceed the market’s ability to take up the increased stock or if we have not performed in such a manner to show that the equity funds raised will be used to grow our business. Such an event could place further downward pressure on the price of our common stock. Regardless of our activities, the opportunity exists for short sellers and others to contribute to the future decline of our stock price. If there are significant short sales of our common stock, the price decline that would result from this activity will cause the share price to decline more, which may cause other stockholders of the stock to sell their shares, thereby contributing to sales of common stock in the market. If there are many more shares of our common stock on the market for sale than the market will absorb, the price of our common shares will likely decline.

The market price and trading volume of shares of our common stock may be volatile.

The market price of our common stock could fluctuate significantly for many reasons, including reasons unrelated to our performance, such as limited liquidity for our stock, reports by industry analysts, investor perceptions or general economic and industry conditions. Fluctuations in operating results or the failure of operating results to meet the expectations of public market analysts and investors may negatively impact the price of our securities. Quarterly operating results may fluctuate in the future due to a variety of factors that could negatively affect revenues or expenses in any particular quarter, including vulnerability of our business to a general economic downturn, changes in the laws that affect our products or operations, competition, compensation related expenses, application of accounting standards and our ability to obtain and maintain all necessary government certifications and/or licenses to conduct our business. In addition, if the market price of a company’s shares drops significantly, stockholders could institute securities class action lawsuits against the company. A lawsuit against us would cause us to incur substantial costs and could divert the time and attention of our management and other resources.

We may not pay dividends in the future. Any return on investment may be limited to the value of our common stock.

We have never paid dividends and do not anticipate paying cash dividends in the foreseeable future. The payment of dividends on our common stock will depend on earnings, financial condition and other business and economic factors affecting us at such time as our board of directors may consider relevant. If we do not pay dividends, our common stock may be less valuable because a return on your investment will only occur if our stock price appreciates. Furthermore, requirements of Florida corporate law and bankruptcy laws may prohibit us from declaring or paying dividends on our stock.

Offers or availability for sale of a substantial number of shares of our common stock may cause the price of our common stock to decline.

If our stockholders sell substantial amounts of our common stock in the public market, or upon the expiration of any statutory holding period under Rule 144, or issued upon the exercise of outstanding options or warrants, it could create a circumstance commonly referred to as an “overhang” and in anticipation of which the market price of our common stock could fall. The existence of an overhang, whether or not sales have occurred or are occurring, also could make more difficult our ability to raise additional financing through the sale of equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate.

Our common stock is currently considered a “penny stock,” which may make it more difficult for our investors to sell their shares.

Our stock is categorized as a penny stock. The SEC has adopted Rule 15g-9 which generally defines “penny stock” to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and accredited investors. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.

We are a publicly registered company that is subject to the reporting requirements of federal securities laws, which can be expensive and may divert resources from other projects, thus impairing our ability to grow.

We are a public reporting company and, accordingly, subject to the information and reporting requirements of the Exchange Act and other federal securities laws, including compliance with the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”). The costs of preparing and filing annual, quarterly and current reports, proxy statements and other information with the SEC and furnishing audited reports to stockholders causes our expenses to be higher than they would have been if we remained private.

As a public company, these rules and regulations have increased our compliance costs and make certain activities more time consuming and costly. As a public company, it is also more difficult and expensive for us to obtain director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our board of directors or as executive officers.

The Sarbanes-Oxley Act also requires corporate governance practices of public companies, which can be burdensome to smaller reporting companies. As a smaller reporting company (as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended), we are required to evaluate our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”). Section 404 requires us to include an internal control report with the Annual Report on Form 10-K. This report must include management’s assessment of the effectiveness of our internal control over financial reporting as of the end of the fiscal year. This report must also include disclosure of any material weaknesses in internal control over financial reporting that we have identified. Failure to comply, or any adverse results from such evaluation, could result in a loss of investor confidence in our financial reports and have an adverse effect on the trading price of our equity securities. Management believes that our internal controls and procedures are currently not effective to detect the inappropriate application of U.S. GAAP rules. Management realizes there are deficiencies in the design or operation of our internal control that adversely affect our internal controls which management considers to be material weaknesses including those described below:

●

We have insufficient quantity of dedicated resources and experienced personnel involved in reviewing and designing internal controls. As a result, a material misstatement of the interim and annual financial statements could occur and not be prevented or detected on a timely basis.

	●	We did not perform an entity level risk assessment to evaluate the implication of relevant risks on financial reporting, including the impact of potential fraud-related risks and the risks related to non-routine transactions, if any, on our internal control over financial reporting. Lack of an entity-level risk assessment constituted an internal control design deficiency which resulted in more than a remote likelihood that a material error would not have been prevented or detected and constituted a material weakness.

	●	We lack personnel with formal training to properly analyze and record complex transactions in accordance with U.S. GAAP.

	●	We have not achieved the optimal level of segregation of duties relative to key financial reporting functions.

Achieving continued compliance with Section 404 may require us to incur significant costs and expend significant time and management resources. We cannot assure you that we will be able to fully comply with Section 404 or that we and our independent registered public accounting firm would be able to conclude that our internal control over financial reporting is effective at fiscal year-end. As a result, investors could lose confidence in our reported financial information, which could have an adverse effect on the trading price of our securities, as well as subject us to civil or criminal investigations and penalties. In addition, our independent registered public accounting firm may not agree with our management’s assessment or conclude that our internal control over financial reporting is operating effectively.

FINRA sales practice requirements may also limit a stockholder’s ability to buy and sell our stock.

In addition to the “penny stock” rules described in this annual report, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for many customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.

Tangiers will pay less than the then-prevailing market price for our common stock.

Our common stock to be issued to Tangiers pursuant to the Investment Agreement, dated January 21, 2020 will be purchased at 88% of the lowest VWAP of the common stock during the pricing period applicable to the Company’s Put Notice (described in under the heading “Investment Agreement” in this prospectus), provided, however, an additional 10% will be added to the discount of each company put if (i) the Company is not DWAC eligible and (ii) an additional 15% will be added to the discount of each Company put if the Company is under DTC “chill” status on the applicable put notice date. “VWAP” means, for any date, the price determined by the daily volume weighted average price of the common stock for such date (or the nearest preceding date) on the Company’s trading market on which the common stock is then listed or quoted for trading. Tangiers has a financial incentive to sell our common stock immediately upon receiving the shares to realize the profit equal to the difference between the discounted price and the market price. If Tangiers sells the shares, the price of our common stock could decrease. If our stock price decreases, Tangiers may have a further incentive to sell the shares of our common stock that it holds. These sales may have a further impact on our stock price and may result in dilution to you and our existing stockholders.

We may not have access to the full amount available under the investment agreement with Tangiers.

Our ability to draw down funds and sell up to a maximum of 76,00,000 shares of our Common Stock under the Investment Agreement with Tangiers requires that the registration statement which we had filed and was declared effective by the Securities and Exchange Commission in March 2020, continue to be effective. The registration statement remains subject to review and comment by the staff of the Securities and Exchange Commission. The effectiveness of these registration statements is a condition precedent to our ability to sell shares of our Common Stock to Tangiers under the Investment Agreement. Even with the effectiveness of our Registration Statement, we may not be able to sell the shares unless certain other conditions are met. Accordingly, because our ability to draw down any amounts under the Investment Agreement is subject to a number of conditions, there is no guarantee that we will be able to draw down any portion or all of the proceeds of $5,000,000 (or such then remaining undrawn amount) under the investment agreement with Tangiers.

Risks related to the 2020 Global Pandemic

In March 2020, the World Health Organization declared a global pandemic related to the virus known as COVID-19. The expected impact on domestic and global commerce have been and are anticipated to continue to be far reaching. To date there have been significant stock market declines and the movement of people and goods worldwide has become severely restricted. Management is actively monitoring the situation and is taking appropriate steps as needed to ensure minimal disruption to the Company’s operations; however, there is a risk the COVID-19 pandemic will continue to disrupt the Company’s operations, including, for example, its sales channels through international retailers who have been impacted by the Covid-19 pandemic, and therefore, the movement of goods and services, as well as its investments in personnel, expansion, marketing and sales generally.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

On ~~December~~January 16, ~~2017~~2021, the Company relocated its corporate headquarters ~~from~~formerly ~~Danbury, Connecticut to New York, New York. The Company’s main office is~~ located at 555 Madison Avenue 5th Floor Suite 506, New York, NY 10022. The Company ~~has~~moved ~~entered~~to ~~into~~4 aNancy ~~two-year lease~~Court, atSuite $14,~~010~~ ~~per~~Wappingers ~~month~~Falls, ~~for~~New York under the ~~term~~terms of ~~the~~a two-year lease, which carries ~~will~~one ~~expire~~two-year onextension ~~November~~for ~~30,~~its ~~2019~~new location at $1,600 ~~unless~~per ~~further~~month ~~extended~~for bythe usterm ~~and our~~of ~~landlord~~the lease.

On June 11, 2019 the Company entered into a two-year lease commencing on June 11, 2019 and expiring on June 30, 2021. ~~The~~That office is located at Regus World Trade Centre Muelle de Barcelona, edif. Sur, 2a Planta Barcelona Cataluña 08039 Spain. ~~Monthly rent~~The ~~payments~~lease ~~will~~has benot ~~approximately~~been ~~$201 per month (based on the contractual rate of €178 multiplied by the exchange rate~~renewed ofand ~~1.13~~there onis ~~the~~no ~~day~~current ~~the~~plan ~~lease~~to ~~agreement~~re-open ~~was~~an ~~entered~~office ~~into)~~there.

See Note 8 to the financial statements for additional discussion regarding the above reference lease agreements.

ITEM 3. LEGAL PROCEEDINGS

None

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

3037

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Market for Common Equity

Market Information

The Company’s common stock is traded on the OTC Bulletin Board under the symbol “TAUG” As of June 26, ~~2020~~2021, the Company’s common stock was held by 1,~~284~~290 shareholders of record which does not include shareholders whose shares are held in street or nominee name.

The following chart isreflects the highest and lowest closing prices by quarter for the for the years ended March 31, 2021 and 2020 and are indicative of the fluctuations in the stock prices:

	For the Years Ended March 31,
	2020				2019
	2021				2020
	High		Low		High		Low
First Quarter	$	0.~~2150~~0640	$	0.~~0645~~0283	$	0.~~0600~~2150	$	0.~~0300~~0645
Second Quarter	$	0.~~0673~~0441	$	0.~~0240~~0296	$	0.~~0375~~0673	$	0.~~0160~~0240
Third Quarter	$	0.~~0532~~1200	$	0.~~0250~~0239	$	0.~~0279~~0532	$	0.~~0150~~0250
Fourth Quarter	$	0.~~0460~~1890	$	0.~~0296~~0920	$	0.~~2350~~0460	$	0.~~0247~~0296

April 1, ~~2020~~2021 to current the stock has a closing trading range of $0.~~0283~~07 to $0.~~0640~~115

The Company’s transfer agent is ClearTrust, LLC located at 16540 Pointe Village Drive, Suite 206, Lutz, Florida 33558 with a telephone number of (813) 235-4490.

Dividend Distributions

We have not historically and do not intend to distribute dividends to stockholders in the foreseeable future.

Securities authorized for issuance under equity compensation plans

The Company does not have any equity compensation plans.

Penny Stock

Our common stock is considered “penny stock” under the rules of the Securities Exchange Act of 1934. The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the NASDAQ Stock Market System, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or quotation system. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the Commission, that:

	●	contains a description of the nature and level of risks in the market for penny stocks in both public offerings and secondary trading;

	●	contains a description of the broker’s or dealer’s duties to the customer and of the rights and remedies available to the customer with respect to a violation to such duties or other requirements of Securities’ laws; contains a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread between the bid and ask price;

	●	contains a toll-free telephone number for inquiries on disciplinary actions;

	●	defines significant terms in the disclosure document or in the conduct of trading in penny stocks; and

	●	contains such other information and is in such form, including language, type, size and format, as the Securities and Commission may require by rule or regulation.

3138

The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with:

	●	bid and offer quotations for the penny stock;

	●	the compensation of the broker-dealer and its salesperson in the transaction;

	●	the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the marker for such stock; and

	●	monthly account statements showing the market value of each penny stock held in the customer’s account.

In addition, the penny stock rules that require that prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written acknowledgement of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitably statement.

These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our stock.

Related Stockholder Matters

On July 26, 2019, the Company’s Board of Directors approved the (i) increase of the authorized common stock of the Company from 100,000,000 shares to 400,000,000 shares; (ii) the filing of both the preliminary and definitive proxy statements; and (iii) approved the record date of July 29, 2019. The Company’s shareholders approved the increase of the authorized shares to 400,000,000 in its Special Meeting on September 10, 2019 and the State of Florida certified the amendment of our Articles of Incorporation effective on September 13, 2019 to reflect this increase.

S-1 Registration Statement and Investment Agreement with Tangiers Global, LLC

On March 5, 2020, the Company filed aan ~~Registration Statement on Form~~ S-1 Registration Statement pursuant to the January 21, 2020, Investment Agreement and Registration Rights Agreement entered into Tangiers in order to establish a source of ~~equity~~ funding for our operations. Under the Investment Agreement, Tangiers ~~has~~ agreed to provide us with a maximum of up to $5,000,000 of funding during the period ending three years from the date of effectiveness of ~~this~~the ~~prospectus.~~S-1 ~~From~~Registration ~~time~~Statement, tounder ~~time~~which ~~during~~we ~~the~~registered ~~period~~a ~~ending~~maximum ~~three~~of ~~(3)~~76,000,000 ~~years~~million ~~after~~shares for sale under ~~this~~the ~~filing,~~terms weof ~~may~~the Investment Agreement. We were, in our sole discretion, allowed to deliver a Put Notice to Tangiers under this facility. The Put Notice ~~will~~would specify the number of shares of common stock which we ~~intend~~intended to sell to Tangiers on a closing date. The closing of a purchase by Tangiers of the shares specified by us in the Put Notice ~~will~~would occur on the date which is no earlier than five and no later than seven ~~Trading~~trading ~~Days~~days following the date Tangiers receives the Put Notice. On the closing date we ~~will~~would sell to Tangiers the shares specified in the Put Notice, and Tangiers ~~will~~would pay us an amount equal to the Purchase Price multiplied by the number of shares specified in the Put Notice. The maximum amount of shares of Common Stock that the Company shall be entitled to Put to Tangiers per any applicable Put Notice shall be an amount of shares up to or equal to two hundred percent (200%) of the average of the daily trading volume (U.S. market only) of the Common Stock for the ten (10) consecutive Trading Days immediately prior to the applicable Put Notice Date (the “Put Amount”) so long as such amount is at least Five Thousand Dollars ($5,000) and does not exceed Three Hundred Fifty Thousand Dollars ($350,000), as calculated by multiplying the Put Amount by the average daily VWAP for the ten (10) consecutive Trading Days immediately prior to the applicable Put Notice Date. During the 36-month term of the Investment Agreement, the Company shall not be entitled to submit a Put Notice until after the previous Closing has been completed. Notwithstanding the foregoing, the Company may not deliver a Put Notice on or earlier of the eighth (8th) Trading Day immediately following the preceding Put Notice Date (the “Waiting Period”), unless a written waiver to deliver Put Notice during the Waiting Period is obtained by the Company from the Investor in advance. The number of shares to be sold by Tangiers in this offering will vary from time-to-time and will depend upon the number of shares purchased from us pursuant to the terms of the Investment Agreement. However, 76,000,000 shares of common stock is the maximum number of shares which we may sell to Tangiers.

3239

~~Purchase~~The ~~Price~~S-1 ~~means~~Registration ~~88%~~statement ofbecame ~~the~~effective ~~lowest~~March ~~VWAP~~16, of2020. ~~the~~As ~~Common~~of ~~Stock~~March ~~during the five (5) consecutive Trading Days including and immediately following the applicable to the Put Notice~~31, ~~provided~~2021, ~~however, an additional 10% will be added to~~ the ~~discount of each Put if (i) the~~ Company ishas ~~not~~initiated ~~DWAC~~put ~~eligible~~notices ~~and (ii) an additional 15% will be added~~ to ~~the~~Tangiers ~~discount of each Put if the Company is under~~for ~~DTC~~a ~~“chill”~~total ~~status~~of ~~on the applicable Put Notice Date. Principal Market means the NYSE MKT~~13, ~~the Nasdaq Capital Market~~910, ~~the~~000 ~~OTC~~shares ~~Bulletin~~receiving ~~Board~~net orproceeds ~~the~~in ~~OTC Markets Group, whichever is~~ the ~~principal~~amount ~~market on which our common stock is traded. VWAP means a price determined by the daily volume weighted average price~~ of ~~our common stock on the Principal Market as reported by (i) Bloomberg Financial L~~$400,514.~~P. or (ii) Stock Charts/Quote Media for the ten consecutive Trading Days immediately prior to the date of the delivery of a Put Notice.~~

~~The~~On ~~S-1~~January ~~Registration~~6, ~~statement became effective March 16~~2021, ~~2020.~~the AsCompany’s board of ~~March~~directors ~~31,~~voted ~~2020,~~unanimously ~~the~~determined ~~Company~~to ~~has~~terminate ~~initiated~~this noequity ~~put~~line ~~notices~~of tocredit facility ~~Tangiers~~by ~~and~~terminating ~~has~~each ~~received~~of nothe ~~proceeds.~~Investment ~~Subsequent~~Agreement toand ~~March~~Registration ~~31,~~Rights ~~2020~~Agreement, ~~the~~and ~~Company~~on ~~has~~January ~~sold 5~~8,~~750,000~~ ~~shares~~2021 offiled ~~Common~~a ~~Stock~~Post-Effective Amendment ~~under~~to ~~the~~its ~~registration~~Form ~~statement~~S-1 ~~for~~Registration ~~total~~Statement ~~proceeds~~(333-236923) removing from registration all shares of ~~$154,418~~common stock not previously sold thereunder.

See also Risk Factor relating to potential future amendments to our Articles of Incorporation.

Purchase of Equity Securities

On November 15, 2017, the board of directors approved the authorization for Seth Shaw, Chief Executive Officer, to repurchase Company stock on the open market or directly from investors up to a market value of $150,000. As of this report date no shares have been repurchased.

Unregistered sales of equity securities and use of proceeds

Common Stock

During the year ended March 31, 2019 the Company issued 3,130,000 shares of its restricted common stock to consultants under three separate consulting agreements.

During the year ended March 31, 2019, the Company issued 5,946,516 shares of restricted common stock to noteholders for the conversion of debt and accrued interest having a value of $200,718 (at an average conversion price of $0.03375 per share).

During the year ended March 31, 2019, the Company issued 5,686,667 shares of common stock ($0.02 to $0.06 per share) for aggregate proceeds of $301,200. The proceeds were used to fund ongoing operations.

During the year ended March 31, 2019, the Company issued 500,000 commitment shares for debt financing ($0.042 per share) valued at $21,000.

During the year ended March 31, 2019, the Company issued 95,667 shares of common stock for the settlement of debt $20,004.

On January 12, 2019, the Company and Open Therapeutics agreed to extinguish the $75,000 contingent liability in exchange for a one-time issuance of 500,000 restricted shares of Company’s common stock. The shares were recorded at a value of $24,750 ($0.0495 per share) as a loss on settlement in the Company’s consolidated financial statements.

During the year ended March 31, 2020, the Company issued 2,450,000 shares under our various distribution agreements, as more fully described in Note 1. Common shares issued had a value of $496,261 ($0.08 to $0.2092 per share).

During the year ended March 31, 2020, the Company issued 21,295,495 shares for conversion of debt in the amount of $467,500 as well as accrued interest in the amount of $28,762 ($0.01412 to $0.04725 per share).

During the year ended March 31, 2020, the Company issued 250,000 shares issued to Vice President of Distribution and Marketing.

During the year ended March 31, 2020, the Company issued 7,100,000 shares issued for services rendered

During the year ended March 31, 2020, the Company issued 2,350,000 shares for debt commitments in the amount of $218,460 ($0.039 to $0.19 per share).

During the year ended March 31, 2020, the Company recognized $569,636 in beneficial conversion feature for convertible notes whereby the holder can exercise conversion rights at a discount to the market price.

During the year ended March 31, 2020, the Company issued 5,470,286 shares under stock purchase agreements in consideration for $143,420 ($0.02 to $0.07 per share) to accredited investors that are unrelated third parties.

On March 27, 2020, the Company entered into a stock purchase agreement with an accredited investor to purchase 200,000 restricted shares of Company’s common stock for $5,000 ($0.025 per share.) As of this report date, these shares have not been issued.

During the year ended March 31, 2021, the Company issued 13,910,000 shares pursuant to put notices issued to Tangiers under the equity line of credit facility, with the Company receiving proceeds in the amount of $369,482 ($0.02614 to $0.03344 per share).

During the year ended March 31, 2021, the Company issued 93,197,109 shares of common stock to holders of convertible notes to retire $1,588,926 in principal and $111,749 of accrued interest (at an average conversion price of $0.01825 per share) under the convertible notes.

During the year ended March 31, 2021, the Company issued 7,687,500 shares for services rendered ($0.0306 to $0.050 per share).

During the year ended March 31, 2021, the Company issued 5,740,000 shares for debt commitments in the amount of $253,869 ($0.028 to $0.092 per share).

During the year ended March 31, 2021, the Company recognized $208,806 in beneficial conversion feature for convertible notes whereby the holder can exercise conversion rights at a discount to the market price.

During the year ended March 31, 2021, the Company issued 40,084,998 shares under stock purchase agreements in consideration for $1,587,214 ($0.024 to $0.09 per share) to accredited investors that are unrelated third parties.

During the year ended March 31, 2021, the Company issued 2,500,000 shares to two directors at a value of $0.092 per share.

On July 10, 2020, the Company’s Chief Executive Officer purchased 700,000 shares of the Company’s Common Stock for an aggregate purchase price of $35,000, at $0.05 per share.

Pursuant to the April 3, 2020, collaboration agreement the Company entered into with Aegea Biotechnologies Inc. (“Aegea”) the Company issued to Aegea 5,000,000 unregistered common shares of Tauriga common stock. The shares were valued at $155,000 ($0.031 per share). For a more complete description of this arrangement please refer to Note 1 to the financial statements under the subheading “Collaboration Agreement with Aegea Biotechnologies Inc.” as well as the agreement exhibits related thereto.

Non-convertible Debt

During the year ended March 31, 2021, the Company had entered into three non-convertible notes with 3 different investment funds. These notes had a cumulative face value of $518,000 with initial proceeds to the Company of $482,000 after deduction of initial discounts and expenses. The three notes collectively had $11,000 of legal fees deducted and original issue discounts of $25,000. These notes carried interest rates of 6% to 12%. These funds were used for operational expenses, consulting fees related to the pharmaceutical IND initiative, the repayment of other debt and the purchase of inventory.

See also the Subsequent Events in Part II of this annual report for issuances of unregistered securities after March 31, 20210, which disclosure is incorporated by reference into this Item 5.

Convertible Debt

During the year ended March 31, ~~2019~~2020, the Company entered into ~~five~~sixteen convertible notes with ~~three~~seven different unrelated ~~private~~investment ~~Companies~~funds. ~~These~~ These notes had a cumulative face value of $~~685~~1,~~000~~082,550 with net proceeds of $~~580~~971,~~750~~100. The notes had $424,~~500~~900 of legal fees deducted, ~~and~~ OID of $3986,~~750~~550. These notes carried an interest ~~rate~~rates of 82% to 10%. These funds were used for operations and the launch of Tauri-GumTM.

During the year ended March 31, ~~2020~~2021, the Company entered into ~~sixteen~~seven convertible notes with ~~seven~~four different unrelated investment funds. These notes had a cumulative face value of $1742,~~082,550~~833 with net proceeds of $~~971~~692,~~100~~800. The notes had $246,~~900~~700 of legal fees deducted, OID of $8643,~~550~~333. These notes carried interest rates of 25% to 108%. These funds were used for operations ~~and~~in the ~~launch~~ purchase of new inventory of Tauri-GumTM as well as the initial funding for the Company’s pharmaceutical trials.

See also the Subsequent Events in Part II of this annual report for issuances of unregistered securities after March 31, ~~2020~~2021, which ~~disclosure~~ disclosure is incorporated by reference into this Item 5.

ITEM 6. SELECTED FINANCIAL DATA.

As the Company is a “smaller reporting company,” this item is inapplicable.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

This annual report on Form 10-K contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our industry, our beliefs and our assumptions. Forward looking statements are often identified by words such as “will”, “may”, “projects”, “anticipate,” “expects,” “intends,” “plans,” “believes,” “seeks” and “estimates” and variations of these words and similar expressions or import are intended to identify forward-looking statements but are not intended to constitute the exclusive means of identifying such statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, including those described in “Risk Factors” contained below in this annual report, some of which are beyond our control and difficult to predict and could cause actual results, performance or achievements, or industry results to differ materially from any future results, performance or achievements, expressed or implied, by such forward-looking statements. You should not place undue reliance on these forward-looking statements, which apply only as of the date of this Form 10-K. Investors should carefully consider all of such risks before making an investment decision with respect to the Company’s stock. The following discussion and analysis should be read in conjunction with our consolidated financial statements for Tauriga Sciences, Inc. Such discussion represents only the best present assessment from our Management.

~~COMPARISON OF THE YEAR ENDED MARCH 31, 2020 TO THE YEAR ENDED MARCH 31, 2019~~41

~~Results~~COMPARISON ofOF ~~Discontinued~~THE ~~Operations~~YEAR ENDED MARCH 31, 2021 TO THE YEAR ENDED MARCH 31, 2020

Revenue

For the years ended March 31, 2020 and 2019, the Company had no revenue or gross profit from discontinued operations from our joint venture with Ice + Jam selling a proprietary cupuaçu butter lip balm, sold under the trademark HERMAN®.

Cost of goods sold

The Company had no cost of goods sold from discontinued operations for the years ended March 31, 2020 and 2019.

Total Expenses

For the year ended March 31, 2020, the Company had no expense from discontinued operations compared to the same period of the prior year in the amount of $2,196.

Net loss

For the years ended March 31, 2020 and 2019, the Company had neither a gain nor loss compared to a net loss of $2,196 from discontinued operations, respectively.

Results of Operations

Revenue

For the years ended March 31, ~~2020~~2021 and ~~2019~~2020, the Company had recognized net revenue of $~~234~~285,~~389~~319 ~~compare~~compared to $57234,~~134~~389, for the same period in the prior year. The Company’s increased sales came from and increased focus on e-commerce sales, ~~distributors~~through ~~and~~marketing ~~wholesale clients. For the purposes~~initiatives ofand ~~sales~~new byproduct ~~sales~~offerings. ~~channel~~The ~~segmentation,~~Company ~~distributor~~recognized ~~sales~~no ~~include~~ sales tothrough ~~customers~~it ~~that~~distribution ~~were~~channel ~~not~~and ~~distributors~~dramatically aslower ofwholesale ~~March 31,~~business ~~2019,~~due ~~however,~~in ~~distributors~~large ~~subsequently~~part ~~entered~~by ~~into~~restriction ~~distribution~~on ~~agreements~~travel ~~with~~and the ~~Company~~ability ~~(as~~to ~~described~~cultivate indistribution ~~the~~networks ~~Business~~as ~~Overview sections~~a result of ~~this~~the ~~annual~~2020 ~~report)~~Coronavirus global pandemic.

Sales of by sales channel for the years ended March 31,

		2020			2019
	2021			2020
Distributor	$	$-	~~62,441~~	$	$62,441	~~54,000~~
E-commerce	$	$233,995	~~34,439~~		34,439	~~794~~
Wholesale	$	$51,324	~~137,509~~		137,509	~~2,340~~
	$	$285,319	~~234,389~~	$	$234,389	~~57,134~~

Cost of Goods Sold:

For the years ended March 31, ~~2020~~2021 and ~~2019~~2020, the Company had cost of goods sold in the amount of $~~197~~162,~~177~~627 and $37180,~~128~~154, respectively as a result of sales to e-commerce customers, distributors and wholesale clients. ~~For~~The ~~the~~lower ~~purposes of~~ cost of goods sold ~~segmentation~~ ~~distributor~~from ~~cost~~higher ~~of goods sold includes~~ sales towas ~~customers~~the ~~that were not distributors as~~ result of ~~March~~increased ~~31,~~sales ~~2019,~~from ~~however subsequently~~higher ~~entered~~margin ~~into~~e-commerce ~~distribution agreements with the Company (as described in the Business Overview sections of this annual report)~~business.

Cost of Goods Sold by sales channel for the years ended March 31,

		2020			2019
	2021			2020
Distributor	$	$-	~~45,985~~	$	$11,314	~~36,000~~
E-commerce	$	$133,444	~~35,314~~		19,064	~~348~~
Wholesale	$	$29,183	~~115,877~~		149,776	~~780~~
	$	$162,627	~~197,177~~	$	$180,154	~~37,128~~

Operating Expenses:

Marketing and advertising expense

For the years ended March 31, ~~2020~~2021 and ~~2019~~2020, marketing and advertising expense from continuing operations was $~~188~~273,~~129~~305 and $4188,~~200~~129, respectively. The increase of $~~183~~85,~~929~~176 was largely due to aincrease ~~fee~~marketing ~~paid~~spend toon ~~E&M Ice Cream under a distribution agreement in the amount of $125~~promotions,~~000,~~ ~~$13,019~~advertising ~~for an e-commerce marketing campaign~~ and ~~product~~social ~~samples~~media ofcampaigns. ~~$8,769~~The ~~due to the~~ Company~~’s inventory~~ ~~allocation~~has ofretained ~~samples~~a ~~for~~freelance ~~the~~Chief ~~new~~Marketing ~~product~~Officer ~~launch~~to offocus ~~Tauri-GumTM.~~on ~~For~~ the ~~year~~growth ~~ended March 31, 2019, marketing and advertising expense from continuing operations was $4,200 due to the Company’s inventory allocation~~ of ~~samples~~this ~~for~~sales ~~the new product launch of Tauri-GumTM~~channel.

Research and development

For the years ended March 31, ~~2020~~2021 and ~~2019~~2020, research and development expense was $6273,~~923~~305 compared to $136,~~924~~923 for the same period in ~~the~~ the prior fiscal year. The current year ~~decreased~~increased expense was due to the expenditures around our IND Tauri-GumTM ~~decreased~~pharmaceutical trial. ~~spending~~The inCompany ~~trademark fees~~also inhad ~~the~~increased ~~current~~expense ~~year~~in ~~offset~~the bydevelopment ~~product~~of ~~design~~Tauri-GumTM ~~costs~~CBD incommercial ~~the~~product ~~current period~~lines.

General and Administrative Expense

For the years ended March 31, ~~2020~~2021 and ~~2019~~2020, general and administrative expenses were $12,~~880~~857,~~256~~220 ~~compared~~and to $1,~~083~~855,~~980~~229, ~~for the same period in prior fiscal year~~respectively. This increase of $~~796~~1,~~276~~001,991 was primarily attributable to increased stock -based compensation in the amount of $~~272~~450,~~931~~178, larger consulting fees of $~~148~~239,~~599~~146, greater ~~legal~~accounting fees of $93126,~~568~~650, ~~bad~~increased ~~debt~~salary expense of $6469,~~146~~450, increased fulfillment cost of ~~conference~~$64,469 ~~fees~~and increased press release cost of $5253,~~133,~~266 ~~proxy~~and ~~expense~~customer service cost of $30,~~000~~193 ~~associated~~offset ~~the~~by ~~litigation~~lower ~~with~~travel ~~Cowan,~~and ~~Gunteski~~conference &fee Cocost.~~, P.A.,~~ etMany ~~al.~~of in the ~~prior~~increased ~~fiscal~~expenses ~~year~~were inhigher ~~the~~as ~~amount~~a ofresult ~~$317,882~~the asCompany’s ~~well~~ongoing aspharmaceutical ~~$401,530~~development ~~less~~efforts ~~stock-based compensation~~ in ~~the~~preparation for ~~current~~clinical ~~year~~studies.

Depreciation and amortization

For the years ended March 31, ~~2020~~2021 and ~~2019~~2020, depreciation and amortization expense was $~~915~~1,737 compared to $~~964~~914 during the prior ~~fiscal~~ fiscal year. Depreciation expense ~~decrease~~increase of $49823 ~~was~~ due to the ~~disposal~~acquisition of ~~computer~~office ~~equipment~~furniture ~~offset~~for byour ~~additional~~new ~~depreciation~~corporate ~~expense~~office and onphone ~~similar~~and ~~replacement~~computer ~~equipment~~acquisition for customer services.

Net Income (Loss)

The Company generated a net loss from continuing operations of $3,~~033~~389,~~290~~474 for the year ended March 31, ~~2020~~2021 compared to $12,~~095~~093,~~243~~245 during the prior fiscal year. The increased loss in the amount of $1,~~938~~350,~~047~~464 was largely due to increased General and Administrative expense of $~~796~~1,~~276~~001,991, increased research and development cost of $266,462, impairment loss on investments of $244,706, increased interest expense of $~~621~~190,~~641~~843, offset by an unrealized ~~loss~~gain on trading securities of $~~219~~1,~~200~~093,071 compared to a ~~gain~~loss of $~~223~~219,~~349~~200 in the prior year and $~~183~~85,~~929~~176 increase in marketing and advertising expense.

Liquidity and Capital Resources

At March 31, ~~2020~~2021, we had cash of $549,~~348~~826 and $~~101~~1,~~200~~246,050 of trading securities compared to the prior fiscal year of $~~385~~5,~~943~~348 of cash and $~~350~~101,~~400~~ 200 of marketable securities. We have historically met our cash needs through a combination of proceeds from private placements of our securities, loans and convertible notes. Our cash requirements are generally for selling, general and administrative activities. We believe that our cash balance is not sufficient to finance our cash requirements for expected operational activities, capital improvements, and partial repayment of debt through the next 12 months.

For operating activities, we used cash of $12,~~510~~554,~~562~~578 for the year ended March 31, ~~2020~~2021 compared to $~~328~~1,~~585~~510,562 during the prior fiscal year. The principal elements of cash flow from operations for the year ended March 31, ~~2020~~2021 were $~~569~~1,~~636~~019,814 common stock issued and issuable for services (including stock based compensation), $~~687~~645,~~486~~832 amortization of debt discount, $~~219~~1,~~200~~023,600 of unrealized gain on trading securities offset by an increase in inventory on hand and prepaid inventory of $~~117~~495,~~839~~861, increased accounts ~~receivable~~payable of $~~106~~314,~~726~~892 and a ~~gain~~ loss on ~~extinguishment~~impairment of ~~debt~~investments ~~in the amount~~ of $~~113~~244,~~468~~706. The principal elements of cash flow from operations for the year ended March 31, ~~2019~~ 2020 were $~~296~~569,~~705~~636 common stock issued and issuable for services (including stock based compensation), $~~583~~687,~~471~~486 amortization of ~~gross~~debt ~~proceeds~~discount, ~~from~~$219,200 ~~the~~of ~~sale~~unrealized ofloss on trading securities offset by an increase in inventory of $~~223~~117,~~349~~839, increased accounts receivable of ~~unrealized~~$106,726 and a gain on ~~trading~~extinguishment ~~securities~~of debt in the amount of $113,468.

Cash used in investing activities during the year ended March 31, ~~2020~~2021 was $58369,~~053~~854 compared to $68108,~~713~~212 from investing activities in in the prior fiscal year. In the fiscal year ended March 31, ~~2020~~2021, the Company invested $37240,~~500~~000 into exercise warrants of VTGN as well as $68278,~~100~~ 212 in ~~Küdzoo~~Aegea Biotechnologies Inc. ~~offset~~The byCompany as invested a ~~loan~~combined ~~from~~$138,375 ~~Chief~~in ~~Executive~~two ~~Officer,~~private ~~Seth~~Companies ~~Shaw~~(Paz inGum LLC and SciSpark LTD – see Note 12 – INVESTMENTS -COST BASED INVESTMENTS. The Company received $302,827 proceed from the ~~amount~~sale of securities. The Company invested $5016,~~159~~094 in equipment and leasehold improvements. In the fiscal year ended March 31, ~~2019~~2020, the Company invested $7237,500 in ~~private~~warrants ~~companies,~~of ~~purchased~~VTGN ~~property~~as ~~and~~well ~~equipment~~as ~~in the amount of~~ $1268,~~390~~100 ~~offset by~~in ~~proceeds~~Küdzoo ~~from~~Inc. ~~the~~The ~~sale~~Company ofalso ~~digital~~invested ~~currency~~$2,612 in the ~~amount~~purchase of ~~$16,177~~property and equipment.

Cash provided by financing activities was $12,~~188~~968,~~020~~910 for the year ended March 31, ~~2020~~2021 compared to $~~770~~1,~~950~~238,179 during the prior fiscal year. During the year ended March 31, ~~2020~~2021 the Company received $~~971~~482,~~100~~000 in proceeds from notes payable, $692,800 proceeds from convertible notes and $~~244~~1,~~420~~665,211 proceeds from the sale of common stock. The Company ~~used~~received proceeds of $27400,~~500~~515 tofrom ~~repay~~registered ~~principal~~shares onand ~~notes~~investment agreement ~~payable~~with Tangiers. ~~During~~The Company also repaid a loan from Chief Executive Officer, Seth Shaw in the amount of $50,159. During the year ended March 31, ~~2019~~ 2020 the Company received $~~580~~971,~~750~~100 in proceeds from notes payable, ~~and~~ $~~331~~244,~~200~~420 proceeds from the sale of common stock and $50,159 from a loan from Chief Executive Officer, Seth Shaw. The Company used $~~141~~27,~~000~~500 to repay principal on convertible notes payable.

As of March 31, ~~2020~~2021, current ~~liabilities~~assets exceeded our current ~~assets~~liabilities by $~~334~~1,~~832~~291,211 compared to current ~~assets~~liabilities exceeding our current ~~liabilities~~assets by $~~490~~334,~~436~~832 at March 31, 2020. As of March 31, ~~2020~~2021, current assets were $~~607~~2,~~894~~396,567 compared to $~~947~~607,~~816~~894 at ~~March~~ March 31, ~~2019~~2020. The ~~decrease~~increase was primarily attributable to the ~~reduction~~increase in ~~cash~~inventory ofand prepaid inventory $~~380~~624,~~943~~572, ~~decrease~~increase in the carrying value of trading securities of $~~249~~1,~~200 offset by an increase in Other Investments of $105~~144,~~600 and increased inventory of $117,839~~850. Current liabilities were $~~942~~1,~~726~~167,356 at March 31, ~~2020~~2021 compared to $~~457~~942,~~380~~ 726 at March 31, ~~2019~~2020. The increase in current liability was mainly due to an increase in ~~notes payable, net of discounts in the amount of $371,259 and an increase in accrued expense (including~~ accounts payable) of $88314,~~071~~892.

Going Concern

During the fourth quarter of the year ended March 31, 2019, the Company began sales and marketing efforts for its Mint flavored Tauri-GumTM product. During the ~~three~~year ~~months~~ ended March 31, ~~2019~~2021, the Company recognized net sales of $57285,~~134~~319 and a gross profit of $20122,~~006~~692, compared ~~which~~to ~~has~~net ~~continued~~sales ~~during the year ended March 31, 2020 where the Company recognized revenue~~ of $~~234~~239,~~389~~388 and a gross profit of $3754,~~212.~~235 ~~During~~for the ~~year~~same ~~ended~~period ~~March~~during ~~31, 2020,~~ the ~~Company~~same ~~has~~period ~~entered~~in ~~into~~the ~~multiple~~prior ~~distribution agreements, is approved and provisioned to sell to many large retailers and ecommerce platforms~~year. ~~The Company has engaged an independent contractor to act as Vice President of Distribution and Marketing.~~ At March 31, ~~2020~~2021, the Company had a working capital ~~deficit~~surplus of $~~334~~1,~~832~~291, ~~resultant~~211 ~~largely~~compared ~~from~~to ~~convertible~~a ~~notes~~working ~~payable~~capital ~~and~~deficit aof ~~liability~~$334,832 tofor ~~issue~~the ~~common~~year ~~stock.~~ended ~~Although~~March 31, ~~the~~2020. ~~Company~~The ~~expects~~improvement ~~that the~~is ~~deficit~~largely ~~will~~resultant befrom ~~remedied~~increased byinventory ~~repayment~~levels inand ~~cash~~an orincrease ~~the~~in ~~conversion~~value of ~~notes~~trading ~~into~~securities. ~~common~~Although the ~~stock~~Company ~~shares~~has asa ~~well~~working ascapital ~~the~~surplus, ~~issuance of~~there ~~shares~~is ~~for~~no ~~which~~guarantee ~~the~~that ~~Company~~this iswill ~~obligated,~~continue therefore it still believes that there is uncertainty with respect to continuing as a going concern.

On July 1, 2019, months after the NYC Department of Heath announced a ban on cannabidiol in foods and beverages (mainly focused on restaurants and baked goods), the updated New York City Health Code now includes an embargoing of CBD-infused Edible(s) Products (including packaged products). The Company is hopeful that the FDA as well as the New York City Council will implement regulations surrounding the CBD industry in a logical and prompt manner. The FDA’s uncertainty surrounding CBD was the initial cause of the New York City ban, and we believe further clarification from the FDA supporting its safety and regulating its labeling will also offer a clearer pathway to the New York City CBD market. The Company believes it is well positioned under the circumstances and has taken a conservative approach towards its products, including, for example, ensuring that its product manufacturer periodically tests for compliance with the Agricultural Improvement Act of 2018, such as utilizing CBD oils from hemp plants which contain 0% THC content.43

~~The~~On ~~Company~~July ~~remains~~1, ~~confident~~2019, ~~that~~months ~~this~~after ~~embargo~~the NYC Department of Heath announced a ban on cannabidiol in foods and beverages (mainly focused on restaurants and baked goods), the result of which was that the updated New York City Health Code now includes an embargoing of CBD-infused Edible(s) Products (including packaged products). The Company is hopeful that due to the recent regulatory regime for cannabinoid products implemented by the NYDPH, the New York City Council will beremove ~~lifted~~the current CBD ban and~~/or~~ ~~clarified~~implement regulations surrounding CBD products in ~~the~~a ~~future~~logical and prompt manner. InThe Company believes it is well positioned under the ~~interim~~current regulatory structure, as and has taken a ~~result~~conservative approach towards its products, including, for example, ensuring that its product manufacturer periodically tests for compliance with the Agricultural Improvement Act of ~~this~~2018, ~~embargo~~such as utilizing CBD oils from hemp plants which contain 0.3% or less THC content. Subsequent to the balance sheet date, the ~~Company~~State of New York has ~~taken~~determined ~~the~~that ~~necessary~~it ~~steps~~is allowable to ~~ensure~~sell ~~that~~CBD ~~their~~Infused ~~marketing~~Edible ~~efforts~~products ~~are~~in ~~focused~~the onforms ~~areas~~of both food and ~~outside~~drink (inclusive of ~~New~~chewing ~~York~~gum). ~~City,~~It ~~while~~was ~~maintaining~~also ~~its~~determined ~~physical~~that ~~presence~~no time can CBD be sold in products that contain either alcohol or tobacco. Additionally, the State of New York ~~City~~also said that NO CBD product may be sold if it contains more than 0.3% (1/333rd by Composition) THC. No Individual food or beverage product may contain more than 25mg of Hemp-Extracted Cannabinoids (“CBD” or “CBG”) per serving. Food and drink infused with CBD and Other Hemp Extracts must be packaged by the manufacturer and extracts cannot be added at the retail level. The Company’s entire product line will comply with these standards.

The Company, in the short term, intends to continue funding its operations either through cash-on-hand or through financing alternatives. Management’s plans with respect to this include raising capital through equity markets ~~as well as through its equity line with Tangiers~~ to fund future operations as well as the possible sale of its remaining marketable securities which had a market value of $~~101~~1,~~200~~246,050 at March 31, ~~2020~~2021. In the event the Company cannot raise additional capital to fund and/or expand operations or fails to raise adequate capital and generate adequate sales revenue, or if the regulatory landscape were to become more difficult or result in regulatory enforcement, it could result in the Company having to curtail or cease operations.

Additionally, even if the Company does raise sufficient capital to support its operating expenses and generate adequate revenues in the short term, there can be no assurances that the revenues will be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations to achieve profitability thereby eliminating its reliance on alternative sources of funding. Although management believes that the Company iscontinues into astrengthen ~~stronger~~its financial position ~~than~~over ~~it has been in in several years~~time, there is still no guarantee that profitable operations with sufficient cashflow to sustain operations can or will be achieved without the need of alternative financing, which is limited. These matters still raise significant doubt about the Company’s ability to continue as a going concern as determined by management. The Company believes that there is uncertainty with respect to continuing as a going concern until the operating business can achieve sufficient sales to maintain profitable operations and sustain cash flow to operate the Company for a period of twelve months. In the event the Company does need to raise additional capital to fund operations or engage in a transaction, failure to raise adequate capital and generate adequate sales revenues could result in the Company having to curtail or cease operations. Even if the Company does raise sufficient capital to support its operating expenses, acquire new license agreements or ownership interests in life science companies and generate adequate revenues, or the agreements entered into recently are successful, there can be no assurances that the revenues will be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern as determined by management. However, the accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

37Even if the Company does raise sufficient capital to support its operating expenses, acquire new license agreements or ownership interests in life science companies and generate adequate revenues, or the agreements entered into recently are successful, there can be no assurances that the revenues will be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern as determined by management. However, the accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

In an effort to support the Company’s future capital needs, on January 21, 2020, the Company entered into a $5,000,000 equity ~~line~~ line financing agreement with Tangiers, as well as a registration right agreement related thereto. The financing ~~term~~ is over a maximum ~~period~~ of 36 months. Pursuant to the Registration Rights Agreement, a maximum of 76,000,000 shares of our ~~Common~~ ~~Stock~~common stock, par value $.00001 per share that we may sell to Tangiers from time to time ~~was~~will be registered by us on Form S-1 with the Securities and Exchange Commission under the Securities Act of 1933, as amended, for this financing. As a result of the Company’s Collaboration Agreement with Aegea, whereby seventy percent (70%) of the Net Proceeds from the sale of the initial 10,000,000 shares of stock of Tauriga using the ELOC ~~will~~were be transferred to and invested in Aegea for the purchase of common stock of Aegea. Additionally, ~~and~~ ~~twenty~~the ~~percent~~Company ~~(20%)~~has ofexcluded ~~all~~4,000,000 ~~subsequent~~shares ~~Net~~under ~~Proceeds,~~ this ~~arrangement~~agreement ~~will~~to ~~provide~~cover liabilities ~~less~~and ~~capital~~expenses related to ~~ongoing operations~~the establishment and maintenance of this agreement. (See earlier in this Note for a more complete description under Investment Agreement and Registration Rights Agreement). As of March 31, 2021, the Company has issued 3,910,000 of the excluded 4,000,000 shares. On January 8, 2021, the Company filed a Post-Effective Amendment to its January 21, 2020 S-1 Investment Agreement and Registration Rights Agreement to terminate the effectiveness of the Registration Statement and to remove from registration all securities registered but not sold under the Registration Statement.

In March 2020, the World Health Organization declared a global pandemic related to the virus known as COVID-19. The expected impact on domestic and global commerce have been and are anticipated to continue to be far reaching. To date there have been significant stock market declines and the movement of people and goods worldwide has become severely restricted. Management is actively monitoring the situation and is taking appropriate steps as needed to ensure minimal disruption to the Company’s operations. There is a risk the COVID-19 pandemic will disrupt the Company’s operations and the movement of goods and services, as well as its investments in personnel, expansion, marketing and sales generally.

Contractual Obligations

On ~~December~~January 16, ~~2017~~2021, the Company relocated its corporate headquarters from ~~Danbury,~~New ~~Connecticut~~York City to ~~New~~Wappingers ~~York~~Falls, ~~New York~~NY. The Company has entered into a two-year lease, ~~for~~with ~~its~~one ~~New~~two-year ~~York~~extension ~~City~~for its new location at $1,~~010~~600 per month for the term of the lease.

OnPer ~~June~~Os ~~11,~~Bio ~~2019,~~has contracted with the Company ~~entered~~as ~~into~~the asole ~~two-year~~manufacturer ~~lease,~~of ~~expiring~~its onTauri-GumTM ~~June~~and ~~30,~~are ~~2021.~~under ~~The~~contract ~~office~~to isproduce ~~located~~our atproduct ~~Regus~~when ordered ~~World~~at ~~Trade Centre~~approximately ~~Muelle~~$4 deper ~~Barcelona,~~blister ~~edif~~pack. ~~Sur,~~Per 2aOS ~~Planta~~is ~~Barcelona~~also ~~Cataluña~~required ~~08039~~to ~~Spain.~~have ~~Monthly~~each ~~rent~~batch ~~payments~~independently ~~will~~tested beto ~~approximately $201~~ensure ~~per~~that ~~month~~each ~~(based~~piece of onchewing ~~the~~gum ~~contractual~~must ~~rate~~contain of10 ~~€178~~milligrams ~~multiplied~~(“mg”) byof ~~the~~CBD ~~exchange~~Isolate, ~~rate~~has of0% ~~1.13~~THC onContent ~~the~~and ~~day~~is ~~the~~clear ~~lease~~for ~~agreement was~~all ~~entered into)~~microbiology.

Per Os Bio has contracted with the Company as the sole manufacturer of its Tauri-GumTM and are under contract to produce our product when ordered at approximately $6 per blister pack. Per OS is also required to have each batch independently tested to ensure that each piece of chewing gum must contain 10 milligrams (“mg”) of CBD Isolate, has 0% THC Content and is clear for all microbiology.

Off-Balance Sheet Arrangements

As of March 31, ~~2019~~2021, the Company had ~~one~~no off-balance sheet ~~arrangement~~arrangements as defined in Item 303(a)(4) of Regulation S-K. ~~During the year ended March 31, 2020, the note holder converted the full principal of $55,000 as well as $2,364 of accrued interest for 2,239,422 common shares ($0.025 per share).~~

On December 20, 2018, the Company entered into security purchase agreement with Adar Alef, LLC whereby the Company issued two 8% convertible redeemable notes in the cumulative principal amount of $110,000. The first 8% note for $55,000 was funded with net proceeds of $47,500, after the deduction of $5,000 for OID and $2,500 in legal fees. The second 8% note (the “Back-End Note”) is initially paid for by an offsetting promissory note issued by Adar Alef, LLC to the Company (the “Note Receivable”). The terms of the Back-End Note require cash funding prior to any conversion thereunder. The Note Receivable is due December 20, 2019, unless certain conditions are not met, in which case both the Back-End Note and the Note Receivable may both be cancelled. Both the First Note and the Back-End Note have a maturity date one year from the date of issuance upon which any outstanding principal and interest is due and payable. The face value amount plus accrued interest under both the First Note and the Back-End Note are convertible into shares of the Company’s common stock at a price for each share of common stock equal to 60% of the lowest daily VWAP of the common stock as reported on the National Quotations Bureau OTC Markets market on which the Company’s shares are traded or any exchange upon which the common stock may be traded in the future, for the 20 prior trading days including the day upon which a notice of conversion is received by the Company or its transfer agent. In the event the Company experiences a DTC “chill” on its shares, the conversion price shall be decreased to 50% instead of 60% while that “chill” is in effect. Upon an event of default, principal and accrued interest will become immediately due and payable under the notes. Additionally, upon an event of default, both notes will accrue interest at a default interest rate of 24% per annum or the highest rate of interest permitted by law. Further, certain events of default may trigger penalty and liquidated damage provisions. This note contains a provision where if the Company shall have defaulted on or breached any term of any other note of similar debt instrument into which the Company has entered and failed to cure such default within the appropriate grace period they would be considered in default of this note. During the first six months this Note is in effect, the Company may redeem this Note by paying to the Holder an amount equal to 140% of the face amount plus any accrued interest. This Note may not be prepaid after the six-month anniversary of the Issuance Date. The back-end note may not be repaid. The note holder may redeem this note at any time after the first six months.

Recent Accounting Pronouncements

In June 2018, the FASB issued ASU No. 2018-07, “Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting” which addresses accounting for issuance of all share-based payments on the same accounting model. Previously, accounting for share-based payments to employees was covered by ASC Topic 718 while accounting for such payments to non-employees was covered by ASC Subtopic 505-50. As it considered recently issued updates to ASC 718, the FASB, as part of its simplification initiatives, decided to replace ASC Subtopic 505-50 with Topic 718 as the guidance for non-employee share-based awards. Under this new guidance, both sets of awards, for employees and non-employees, will essentially follow the same model, with small variations related to determining the term assumption when valuing a non-employee award as well as a different expense attribution model for non-employee awards as opposed to employee awards. The ASU is effective for public business entities beginning in 2019 calendar years and one year later for non-public business entities. The Company does not believe there is a material impact on their consolidated financial position and results of operations as a result of this standard.

In February 2016, FASB issued ASU 2016-02, “Leases (Topic 842).” The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period and is applied retrospectively. Early adoption is permitted. The Company has adopted this standard as of April 1, 2019 and does not believe there will be a material impact on the adoption of this guidance on their consolidated financial statements.

There are several other new accounting pronouncements issued or proposed by the FASB. Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe any of these accounting pronouncements has had or will have a material impact on the Company’s consolidated financial position or operating results.

Critical Accounting Policies

Revenue Recognition

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). This standard provides a single set of guidelines for revenue recognition to be used across all industries and requires additional disclosures. The updated guidance introduces a five-step model to achieve its core principal of the entity recognizing revenue to depict the transfer of goods or services to customers at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted the updated guidance effective October 1, 2017 as the Company commenced sales of HerMan® using the full retrospective method. The new standard did not have a material impact on its financial position and results of operations, as it did not change the manner or timing of recognizing revenue.

Under ASC 606, in order to recognize revenue, the Company is required to identify an approved contract with commitments to preform respective obligations, identify rights of each party in the transaction regarding goods to be transferred, identify the payment terms for the goods transferred, verify that the contract has commercial substance and verify that collection of substantially all consideration is probable. The adoption of ASC 606 did not have an impact on the Company’s operations or cash flows.

On June 29, 2018, the Company purchased four Blink Level 2 - 40” pedestal chargers for permanent placement in a retail location or locations whereby the Company will pay a variable annual fee based on 7% of total revenue per charging unit. The remainder of the proceeds will be split 80/20 between the Company and the host location owner or its assignee. The host location owner to will pay for the cost of providing power to these unit as well as installation costs.

As of March 31, 2020, the Tauriga BDC has not installed any of these machines in any locations, and no revenue has been generated through the Blink contract.

The Company recognizes revenue upon the satisfaction of the performance obligation. The Company considers the performance obligation met upon shipment of the product or delivery of the product. For ecommerce orders, the Company’s products are shipped by a fulfillment company and payment is made in advance of shipment either through credit card or PayPal. The Company also delivers the product to its customers that they market to in the metropolitan New York Tri-State area that are not covered under any existing distribution agreements. The Company generally collects payment within 30 to 60 days of completion of its performance obligation, and the Company has no agency relationships.

Investment in Trading Securities

Investment in trading securities consist of investments in shares of common stock of companies traded on public markets as well as publicly traded warrants of these companies should there be a market for them. These securities are carried on the Company’s balance sheet at fair value based on the closing price of the shares owned on the last trading day before the balance sheet date of this report. Fluctuations in the underlying bid price of the stocks result in unrealized gains or losses. The Company recognizes these fluctuations in value as other income or loss.

For investments sold, the Company recognizes the gains and losses attributable to these investments as realized gains or losses in other income or loss.

Stock-Based Compensation

The Company accounts for Stock-Based Compensation under ASC 718 “Compensation-Stock Compensation,” which addresses the accounting for transactions in which an entity exchanges its equity instruments for goods or services, with a primary focus on transactions in which an entity obtains employee services in share-based payment transactions. ASC 718-10 requires measurement of cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). Incremental compensation costs arising from subsequent modifications of awards after the grant date must be recognized.

The Company accounts for stock-based compensation awards to non-employees in accordance with ASC 505-50, “Equity-Based Payments to Non-Employees.” Under ASC 505-50, the Company determines the fair value of the warrants or stock-based compensation awards granted on the grant date as either the fair value of the consideration received, or the fair value of the equity instruments issued, whichever is more reliably measurable. Any stock options or warrants issued to non-employees are recorded in expense and an offset to additional paid-in capital in stockholders’ equity over the applicable service periods using variable accounting through the vesting dates based on the fair value of the options or warrants at the end of each period.

The Company issues stock to consultants for various services. The costs for these transactions are measured at the fair value on the grant date of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. The Company recognized consulting expense and a corresponding increase to additional paid-in-capital related to stock issued for services over the term of the related services.

Impairment of Long-Lived Assets

Long-lived assets, primarily fixed assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets might not be recoverable. The Company will perform a periodic assessment of assets for impairment in the absence of such information or indicators. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner in which an asset is used, or a significant adverse change that would indicate that the carrying amount of an asset or group of assets is not recoverable. For long-lived assets to be held and used, the Company would recognize an impairment loss only if its carrying amount is not recoverable through its undiscounted cash flows and measures the impairment loss based on the difference between the carrying amount and estimated fair value.

Fair Value Measurements

ASC 820 “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements.

The following provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which fair value is observable:

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 2- fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Financial instruments classified as Level 1 - quoted prices in active markets include cash.

These consolidated financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates. In addition, since estimates are as of a specific point in time, they are susceptible to material near-term changes. Changes in economic conditions may also dramatically affect the estimated fair values

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management for the respective periods. The respective carrying value of certain financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash, investments, short-term notes payable, accounts payable and accrued expenses.

~~Derivative Financial Instruments~~47

Derivatives are recorded on the consolidated balance sheet at fair value. The conversion features of the convertible debentures are embedded derivatives and are separately valued and accounted for on the consolidated Balance Sheets with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model we use for determining the fair value of our derivatives are binomial pricing models. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (loss).

With the issuance of the July 2017 FASB ASU 2017-11, “Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815),” which addresses the complexity of accounting for certain financial instruments with down round features, the Company has chosen the early adopt retroactively the amendments in Part I of the standard whereby fair value derivative liabilities previously recognized were derecognized in the current and comparative periods. Under the amendments included in this update, the Company is no longer required to record changes in fair value during the period of change as a separate component of other income (expense) in the consolidated Statements of Operations.

The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, “Debt—Debt with Conversion and Other Options”), including related EPS guidance (in Topic 260). The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect.

Under current GAAP, an equity-linked financial instrument with a down round feature that otherwise is not required to be classified as a liability under the guidance in Topic 480 is evaluated under the guidance in Topic 815, “Derivatives and Hedging,” to determine whether it meets the definition of a derivative. If it meets that definition, the instrument (or embedded feature) is evaluated to determine whether it is indexed to an entity’s own stock as part of the analysis of whether it qualifies for a scope exception from derivative accounting. Generally, for warrants and conversion options embedded in financial instruments that are deemed to have a debt host (assuming the underlying shares are readily convertible to cash or the contract provides for net settlement such that the embedded conversion option meets the definition of a derivative), the existence of a down round feature results in an instrument not being considered indexed to an entity’s own stock. This results in a reporting entity being required to classify the freestanding financial instrument or the bifurcated conversion option as a liability, which the entity must measure at fair value initially and at each subsequent reporting date.

The amendments in this Update revise the guidance for instruments with down round features in Subtopic 815-40, “Derivatives and Hedging—Contracts in Entity’s Own Equity,” which is considered in determining whether an equity-linked financial instrument qualifies for a scope exception from derivative accounting. An entity still is required to determine whether instruments would be classified in equity under the guidance in Subtopic 815-40 in determining whether they qualify for that scope exception. If they do qualify, freestanding instruments with down round features are no longer classified as liabilities and embedded conversion options with down round features are no longer bifurcated.

For entities that present EPS in accordance with Topic 260, and when the down round feature is included in an equity-classified freestanding financial instrument, the value of the effect of the down round feature is treated as a dividend when it is triggered and as a numerator adjustment in the basic EPS calculation. This reflects the occurrence of an economic transfer of value to the holder of the instrument, while alleviating the complexity and income statement volatility associated with fair value measurement on an ongoing basis. Convertible instruments are unaffected by the Topic 260 amendments in this Update.

Those amendments in Part I of this Update are a cost savings relative to current GAAP. This is because, assuming the required criteria for equity classification in Subtopic 815-40 are met, an entity that issued such an instrument no longer measures the instrument at fair value at each reporting period (in the case of warrants) or separately accounts for a bifurcated derivative (in the case of convertible instruments) on the basis of the existence of a down round feature. For convertible instruments with embedded conversion options that have down round features, applying specialized guidance such as the model for contingent beneficial conversion features rather than bifurcating an embedded derivative also reduces cost and complexity. Under that specialized guidance, the issuer recognizes the intrinsic value of the feature only when the feature becomes beneficial instead of bifurcating the conversion option and measuring it at fair value each reporting period.

The amendments in Part II of this Update replace the indefinite deferral of certain guidance in Topic 480 with a scope exception. This has the benefit of improving the readability of the Codification and reducing the complexity associated with navigating the guidance in Topic 480.

For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The amendments in Part 1 of this Update should be applied in either of the following ways:

	1.	retrospectively to outstanding financial instruments with a down round feature by means of a cumulative-effect adjustment to the statement of financial position as of the beginning of the first fiscal year and interim period(s) in which the pending content that links to this paragraph is effective; or
	2.	retrospectively to outstanding financial instruments with a down round feature for each prior reporting period presented in accordance with the guidance on accounting changes in paragraphs 250-10-45-5 through 45-10.

The amendments in Part II of this Update do not require any transition guidance because those amendments do not have an accounting effect.

Share settled debt

The general measurement guidance in ASC 480 requires obligations that can be settled in shares with a fixed monetary value at settlement to be carried at fair value unless other accounting guidance specifies another measurement attribute. The Company has determined that ASC 835-30 is the appropriate accounting guidance for the share-settled debt, which is what was done by setting up the debt discount which is to be amortized to interest expense over the term of the instrument. Amortization of discounts are to be amortized using the effective interest method over the term of the note.

ASC 480-10-25-14 requires liability accounting for (1) any financial instrument that embodies and unconditional obligation to transfer a variable number of shares or (2) a financial instrument other than an outstanding share that embodies a conditional obligation to transfer a variable number of shares, provided that the monetary value of the obligation is based solely or predominantly on any of the following: 1. A fixed monetary amount known at inception (e.g. stock settled debt); 2. Variations in something other than the fair value of the issuer’s equity shares (e.g. a preferred share that will be settled in a variable number of common shares with tits monetary value tied to a commodity price); and 3. Variations in the fair value of the issuer’s equity shares, but the monetary value to the counterparty moves inversely to the value of the issuer’s shares (e.g. net share settled written put options, net share settled forward purchase contracts).

Notwithstanding the fact that the above instruments can be settled in shares, FASB concluded that equity classification is not appropriate because instruments with those characteristics do not expose the counterparty to risks and rewards similar to those of an owner and, therefore do not create a shareholder relationship. The issuer is instead using its shares as the currency to settle its obligation.

The Company has multiple notes that contain discount provisions whereby the holder can exercise conversion rights at a discount to the market price for a 15-day trailing period based on the market volume average weighted price. ASC 470-20 defines this as a beneficial conversion feature which that shall be recognized separately at issuance by allocating a portion of the proceeds equal to the intrinsic value, not to exceed the face value of the note, to additional paid in capital. This segmented value, is to be amortized using the effective interest method over the term of the note.

Segment information

The Company has adopted provisions of ASC 280-10 Segment Reporting for the years ended March 31, 2021 and 2020. This standard requires that companies disclose operating segments based on the manner in which management disaggregates the Company in making internal operating decisions. The Company and its Chief Operating Decision Makers determined that the Company’s operations consist of two segments: (i) The first division consists of all retail, wholesale and e-commerce product sales of CBD/CBG Tauri-Gum^TM, Tauri-Gummies^TM, and other CBD/CBG products, and (ii) the second segment will be a research and development division that consist of liabilities and results from any activity relative to the progress in the development of the Company’s FDA IND application for Phase II Trial of its proposed pharmaceutical grade version of Tauri-Gum™. The cost basis investment in Aegea has been treated as a non-operating asset and will therefore not be reported as a part of the research and development division.

Research and development

The Company expenses research and development costs as incurred. Research and development costs were $273,385 and $6,923 for the years ended March 31, 2021 and 2020, respectively. The Company is continually evaluating products and technologies, and incurs expenses relative to these evaluations, including in the natural wellness space, such as Tauri-Gum™ product development of new flavor formulations and other CBD delivery products, as well as development of a Cannabigerol (“CBG”) Isolate Infused version of its Tauri-Gum™ brand. We also incur expenses relative to collaboration agreements and any activity relative to the progress in the development of the Company’s FDA IND application for Phase II Trial of its proposed pharmaceutical grade version of Tauri-Gum™, as well as intellectual property or other related technologies. As the Company investigates and develops relationships in these areas, resultant expenses for trademark filings, license agreements, website and product development and design materials will be expensed as research and development. Some costs will be accumulated for subsidiaries prior to formation of any new entities.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As the Company is a “smaller reporting company,” this item is inapplicable.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

Report of Independent Registered Public Accounting Firm – Current (BF Borgers CPA PC)	F-1
Report of Independent Registered Public Accounting Firm – Former (KBL, LLP)	F-2
Consolidated Balance Sheets	F-2
Consolidated Balance Sheets	F-3
Consolidated Statements of Operations and Comprehensive Loss	F-3
Consolidated Statements of Operations and Comprehensive Loss	F-4
Consolidated Statements of Stockholders’ Equity (Deficit)	F-4
Consolidated Statements of Stockholders’ Equity (Deficit)	F-5
Consolidated Statements of Cash Flows	F-5
Consolidated Statements of Cash Flows	F-6
Notes to Consolidated Financial Statements	F-6
Notes to Consolidated Financial Statements	F-7

4349

Report of Independent Registered Public Accounting Firm

To the shareholders and the board of directors of Tauriga Sciences, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance ~~sheet~~sheets of Tauriga Sciences, Inc. ~~(the “Company”)~~ as of March 31, 2021 and 2020, the related ~~statement~~ statements of operations, stockholders’ equity (deficit), and cash flows for the ~~year~~years then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2021 and 2020, and the results of its operations and its cash flows for the ~~year~~years then ended, in conformity with accounting principles generally accepted in the United States.

Substantial Doubt about the Company’s Ability to Continue as a Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has a significant accumulated deficit. In addition, the Company continues to experience negative cash flows from operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

~~Substantial~~/s/ ~~Doubt~~BF ~~about~~Borgers ~~the~~CPA ~~Company’s Ability to Continue as a Going Concern~~PC

~~The~~BF ~~accompanying~~Borgers ~~consolidated~~CPA financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company’s significant operating losses raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.PC

~~/s/ BF Borgers CPA PC BF Borgers CPA PC~~ We have served as the Company’s auditor since 2019 ~~Lakewood, CO June 29, 2020~~

Lakewood, CO

June 29, 2021

F-1

~~REPORT~~TAURIGA OFSCIENCES, ~~INDEPENDENT~~INC. ~~REGISTERED~~AND ~~PUBLIC ACCOUNTING FIRM~~SUBSIDIARY

ToCONSOLIDATED ~~the~~BALANCE ~~Board of Directors and Stockholders~~SHEETS

of(IN ~~Tauriga Sciences, Inc. and Subsidiaries~~US$)

Opinion on the Financial Statements

	March 31, 2021			March 31, 2020
ASSETS
Current assets:
Cash	$	49,826		$	5,348
Accounts receivable, net allowance for doubtful accounts		32,227			42,580
Investment - trading securities		1,246,050			101,200
Investment - other		312,481			178,100
Inventory asset		647,013			128,711
Prepaid inventory		423,200			-
Prepaid expenses and other current assets		131,411			151,955
Total current assets		2,396,567			607,894

Lease right of use asset		64,301			22,090
Assets held for resale		11,084			-
Property and equipment, net		12,063			13,478
Leasehold improvements, net of amortization		4,688			-

Total assets	$	2,488,703		$	643,462

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Notes payable, net of discounts	$	504,819		$	585,134
Accounts payable		390,947			76,055
Accrued interest		14,722			39,384
Accrued expenses		68,442			46,719
Loan Payable to office		-			50,159
Liability for common stock to be issued		174,000			131,000
Lease liability - current portion		14,426			13,891
Deferred revenue		-			384
Total current liabilities		1,167,356			942,726

Lease liability - net of current portion		50,100			8,933

Total liabilities		1,217,456			951,659

Stockholders’ equity (deficit):

Common stock, par value $0.00001; 400,000,000 shares authorized,275,858,714 and 107,039,107 outstanding at March 31, 2021 and 2020, respectively		2,760			1,070
Additional paid-in capital		63,417,565			58,213,365
Accumulated deficit		(62,149,078	)		(58,522,632	)
Accumulated other comprehensive income		-			-
Total stockholders’ equity (deficit)		1,271,247			(308,197	)

Total liabilities and stockholders’ equity (deficit)	$	2,488,703		$	643,462

WeThe ~~have audited the~~ accompanying ~~consolidated~~notes ~~balance~~are ~~sheet~~an ofintegral ~~Tauriga~~part ~~Sciences, Inc. and Subsidiaries (the “Company”) as~~ of ~~March 31, 2019,~~ the ~~related~~ consolidated ~~statement of operations, changes in stockholders’ equity (deficit), and cash flows for the year then ended, and the related notes (collectively referred to as the “consolidated~~ financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of March 31, 2019, and the results of its consolidated operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal controls over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Going Concern Consideration

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has sustained significant operating losses and needs to obtain additional financing to continue the services they provide. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ KBL, LLP We have served as the Company’s auditor from 2015 to 2019. KBL, LLP New York, NY June 27, 2019

F-2

TAURIGA SCIENCES, INC. AND SUBSIDIARY ~~CONSOLIDATED BALANCE SHEETS (IN US$)~~

	March 31, 2020			March 31, 2019
ASSETS
Current assets:
Cash	$	5,348		$	385,943
Assets from discontinued operations		-			581
Accounts receivable, net allowance for doubtful accounts		42,580			-
Investment - trading securities		101,200			350,400
Investment - other		178,100			72,500
Inventory asset		128,711			10,872
Prepaid expenses and other current assets		151,955			127,520
Total current assets		607,894			947,816
Lease right of use asset		22,090			-
Property and equipment, net		13,478			13,010
Total assets	$	643,462		$	960,826
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Notes payable, net of discounts	$	585,134		$	213,875
Accounts payable		76,055			34,703
Accrued interest		39,384			30,780
Accrued expenses		46,719			-
Loan Payable to office		50,159			-
Liabilities from discontinued operations		-			5,522
Liability for common stock to be issued		131,000			172,500
Lease liability - current portion		13,891			-
Deferred revenue		384			-
Total current liabilities		942,726			457,380
Lease liability - net of current portion		8,933			-
Total liabilities		951,659			457,380
Stockholders’ equity (deficit):
Common stock, par value $0.00001; 400,000,000 shares authorized, 107,039,107 and 68,123,326 outstanding at March 31, 2020 and 2019, respectively		1,070			681
Additional paid-in capital		58,213,365			55,991,704
Accumulated deficit		(58,522,632	)		(55,488,939	)
Accumulated other comprehensive income		-			-
Total stockholders’ equity (deficit)		(308,197	)		503,446
Total liabilities and stockholders’ equity (deficit)	$	643,462		$	960,826

CONSOLIDATED STATEMENTS OF OPERATIONS

(IN US$)

	For the Years Ended
	March 31,
	2021			2020

Gross revenue	$	354,667		$	239,388
Sales Discounts		(63,973	)		(4,999	)
Sales returns		(5,375	)		-
Net Revenue		285,319			234,389

Cost of goods sold		162,627			180,154

Gross profit		122,692			54,235

Operating expenses
Marketing and advertising		273,305			188,129
Research and development		273,385			6,923
Fulfilment services		106,519			42,050
General and administrative		2,857,220			1,855,229
Depreciation and amortization expense		1,737			914
Total operating expenses		3,512,166			2,093,245

Loss from operations		(3,389,474	)		(2,039,010	)

Other income (expense)
Interest expense		(1,093,071	)		(902,228	)
Unrealized gain (loss) on trading securities		1,023,600			(219,200	)
Gain (Loss) on conversion of debt		(70,208	)		113,466
Loss on asset disposal		-			(1,230	)
Gain on lease termination		836			-
Gain on sale of trading securities		-			10,000
Loss on impairment of investment		(244,706	)		-
Gain on sale of trading securities		146,577			-
Gain on disposal of discontinued operations		-			4,941
Foreign exchange		-			(29	)
Total other income (expense)		(236,972	)		(994,280	)

LOSS FROM CONTINUING OPERATIONS BEFORE PROVISION FOR INCOME TAXES		(3,626,446	)		(3,033,290	)

PROVISION FOR INCOME TAXES		-

Net loss		(3,626,446	)		(3,033,290	)

Net loss attributable to common shareholders	$	(3,626,446	)	$	(3,033,290	)
Loss per share - basic and diluted - Continuing operations	$	(0.019	)	$	(0.037	)
Loss per share - basic and diluted - Discontinuing operations	$	-		$	-
Weighted average number of shares outstanding - basic and fully diluted		193,622,141			80,949,849

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

F-3

TAURIGA SCIENCES, INC. AND SUBSIDIARY ~~CONSOLIDATED STATEMENTS OF OPERATIONS (IN US$)~~

	For the Year Ended
	March 31,
	2020			2019
Revenues	$	234,389		$	57,134
Cost of goods sold		197,177			37,128
Gross profit		37,212			20,006
Operating expenses
Marketing and advertising		188,129			4,200
Research and development		6,923			13,924
General and administrative		1,880,256			1,083,980
Depreciation and amortization expense		914			964
Total operating expenses		2,076,222			1,103,068
Loss from operations		(2,039,010	)		(1,083,062	)
Other income (expense)
Interest expense		(902,228	)		(280,587	)
Unrealized gain (loss) on trading securities		(219,200	)		223,349
Loss on conversion of debt		-			(27,975	)
Loss on asset disposal		(1,230	)		(907	)
Gain on the extinguishment of debt		113,466			-
Gain on disposal of discontinued operations		4,941			-
Legal settlement expense		-			(20,004	)
Unrealized loss on digital currency		-			(3,143	)
Loss on sale of commodities		-			(2,737	)
Gain (loss) on sale of trading securities		10,000			99,823
Foreign exchange		(29	)		-
Total other income (expense)		(994,280	)		(12,181	)
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE PROVISION FOR INCOME TAXES AND LOSS FROM DISCONTINUED OPERATIONS		(3,033,290	)		(1,095,243	)
INCOME (LOSS) FROM DISCONTINUED OPERATIONS		-			(2,196	)
Net income (loss)		(3,033,290	)		(1,097,439	)
Net income (loss) attributable to non-controlling interest		-			-
Net income (loss) attributable to controlling interest		(3,033,290	)		(1,097,439	)
Net income (loss) attributable to common shareholders	$	(3,033,290	)	$	(1,097,439	)
Income (loss) per share - basic and diluted - Continuing operations	$	(0.037	)	$	(0.020	)
Income (loss) per share - basic and diluted - Discontinuing operations	$	-		$	(0.000	)
Weighted average number of shares outstanding - basic		80,949,849			55,767,119
Income (loss) per share - fully diluted	$	(0.037	)	$	(0.020	)
Weighted average number of shares outstanding - fully diluted		80,949,849			55,767,119

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)

FOR THE YEARS ENDED MARCH 31, 2021 AND 2020

											Accumulated
					Additional						other				Non-		Total
	Number of				paid-in			Accumulated			comprehensive				Controlling		stockholders’
	shares		Amount		capital			deficit			income (loss)				Interest		deficit
Balance at April 1, 2019		68,123,326		681		55,991,704			(55,488,939	)		-		-		-		503,446

Issuance of shares via private placement at $0.02 to $0.07 per share		5,470,286		54		143,366			-			-		-		-		143,420
Issuance of commitment shares - debt financing at $0.039 to $0.19 per share		2,350,000		25		218,435			-			-		-		-		218,460
Shares issued for note conversion at $0.01412 to $0.04725 per share		21,295,495		212		496,050			-			-		-		-		496,262
Stock-based compensation vesting		-		-		569,636			-			-		-		-		569,636
Stock issued for services at $0.0174 to $0.2092		7,350,000		73		(73	)		-			-		-		-		-
Issuance of shares for distribution agreements at $0.08 to $0.2092		2,450,000		25		(25	)		-			-		-		-		-
Recognition of beneficial conversion feature of convertible notes		-		-		794,272			-			-		-		-		794,272
Cumulative effect of adoption of Lease standard ASC 842		-		-		-			(403	)		-		-		-		(403	)
Net loss for the year ended March 31, 2020		-		-		-			(3,033,290	)		-		-				(3,033,290	)

Balance at March 31, 2019		107,039,107	$	1,070	$	58,213,365		$	(58,522,632	)	$	-	$	-	$	-	$	(308,197	)

Issuance of shares to CEO for cash at $0.05 per share		700,000		7		34,993			-			-		-		-		35,000
Issuance of shares via private placement at $0.024 to $0.09 per share		40,084,998		401		1,586,811			-			-		-		-		1,587,212
Issuance of commitment shares - debt financing at $0.028 to $0.092 per share		5,740,000		58		253,810			-			-		-		-		253,868
Shares issued for note conversion at $0.01242 to $0.03 per share		93,197,109		932		1,699,744			-			-		-		-		1,700,676
Stock-based compensation vesting		-		-		1,019,814			-			-		-		-		1,019,814
Stock issued for services at $0.0306 to $0.05		15,187,500		152		(152	)		-			-		-		-		-
Issuance of unrestricted shares - Tangiers Investment agreement at $0.02614 to $0.03344		13,910,000		140		400,374			-			-		-		-		400,514
Recognition of beneficial conversion feature of convertible notes		-		-		208,806			-			-		-		-		208,806
Cumulative effect of adoption of Lease standard ASC 842		-		-		-			-			-		-		-		-
Net loss for the year ended March 31, 2021		-		-		-			(3,626,446	)		-		-		-		(3,626,446	)

Balance at March 31, 2021		275,858,714	$	2,760	$	63,417,565		$	(62,149,078	)	$	-	$	-	$	-	$	1,271,247

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

F-4

TAURIGA SCIENCES, INC. AND ~~SUBSIDIARY CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT) FOR THE YEARS ENDED MARCH 31, 2020 AND 2019~~SUBSDIARY

											Accumulated
					Additional						other						Total
	Number of				paid-in			Accumulated			comprehensive			Non-Controlling			stockholders’
	shares		Amount		capital			deficit			income (loss)			Interest			deficit
Balance at April 1, 2018		52,264,476		523		54,680,382			(54,391,500	)		8,042			(2,196	)		295,251
Issuance of shares via private placement at $0.02 to $0.06 per share		5,686,667		56		301,144			-			-			-			301,200
Issuances of commitment shares - debt financing at $0.042 per share		500,000		5		20,995			-			-			-			21,000
Shares issued for note conversion at $0.0245 to $0.0452 per share		5,946,516		60		200,658			-			-			-			200,718
Stock-based compensation vesting		-		-		296,705			-			-			-			296,705
Stock issued for services at $0.0269 to $0.42		3,130,000		31		(31	)		-			-			-			-
Shares issued for settlement of contingent liability		500,000		5		74,995			-			-			-			75,000
Shares issued for settlement of debt		95,667		1		20,003			-			-			-			20,004
Reclassification of other comprehensive income to additional paid in capital		-		-		8,042			-			(8,042	)		-			-
Recognition of beneficial conversion feature of convertible notes		-		-		388,811			-			-			-			388,811
Non-controlling interest		-		-		-			-			-			2,196			2,196
Net loss for the year ended March 31, 2019		-		-		-			(1,097,439	)		-						(1,097,439	)
Balance at March 31, 2019		68,123,326	$	681	$	55,991,704		$	(55,488,939	)	$	-		$	-		$	503,446
Issuance of shares via private placement at $0.02 to $0.07 per share		5,470,286		54		143,366			-			-			-			143,420
Issuances of commitment shares - debt financing at $0.039 to $0.19 per share		2,350,000		25		218,435			-			-			-			218,460
Shares issued for note conversion at $0.01412 to $0.04725 per share		21,295,495		212		496,050			-			-			-			496,262
Stock-based compensation vesting		-		-		569,636			-			-			-			569,636
Stock issued for services at $0.0174 to $0.2092		7,350,000		73		(73	)		-			-			-			-
Issuance of shares for distribution agreements at $0.08 to $0.2092		2,450,000		25		(25	)		-			-			-			-
Recognition of beneficial conversion feature of convertible notes		-		-		794,272			-			-			-			794,272
Cumulative effect of adoption of Lease standard ASC 842		-		-		-			(403	)		-			-			(403	)
Net loss for the year ended March 31, 2020		-		-		-			(3,033,290	)		-						(3,033,290	)
Balance at March 31, 2020		107,039,107	$	1,070	$	58,213,365		$	(58,522,632	)	$	-		$	-		$	(308,197	)

CONSOLIDATED STATEMENTS OF CASH FLOWS

~~F-5~~(IN US$)

TAURIGA SCIENCES, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS (IN US$)

	For the Years Ended
	March 31,
	2021			2020

Cash flows from operating activities
Net loss attributable to controlling interest	$	(3,626,446	)	$	(3,033,290	)
Adjustments to reconcile net loss to cash
used in operating activities:
Bad debt expense		29,404			64,146
Amortization of original issue discount		100,543			67,044
Non-cash lease operating lease expense		327			331
Depreciation and amortization		1,737			914
Loss on disposal of fixed assets		-			1,230
Non-cash interest		253,869			75,960
Loss (gain) on extinguishment of debt		-			(113,468	)
Gain on lease termination		(836	)		-
Amortization of debt discount		645,832			687,486
Common stock issued and issuable for services (including stock-based compensation)		1,019,814			569,636
Impairment loss on investment		244,706			-
Gain on disposal of discontinued operation		-			(4,941	)
Legal fees deducted from proceeds of notes payable		17,700			24,900
(Gain) loss on the sale of trading securities		(146,577	)		(10,000	)
Unrealized loss (gain) on trading securities		(1,023,600	)		219,200
(Increase) decrease in assets
Prepaid expenses		(1,348	)		(24,435	)
Inventory		(518,302	)		(117,839	)
Proceeds (purchase) of trading securities, net		-			40,000
Accounts receivable		(19,051	)		(106,726	)
Increase (decrease) in liabilities
Accounts payable		296,892			41,352
Deferred revenue		(384	)		384
Accrued expenses		21,722			46,720
Accrued interest		87,087			60,834
Cash used in operating activities		(2,554,578	)		(1,510,562	)

Cash flows from investing activities
Investment in VTGN warrants		-			(37,500	)
Exercise of unregistered warrants for common stock		(240,000	)		-
Loan from Officer		(50,159	)		50,159
Sales proceeds from trading securities		302,827			-
Investment - other		(416,587	)		(68,100	)
Purchase of property and equipment, including leasehold improvements		(16,094	)		(2,612	)
Cash used in investing activities		(420,013	)		(58,053	)

Cash flows from financing activities
Loan from officer		-			50,159
Repayment of loan from officer		(50,159	)		-
Repayment of principal on convertible notes payable		(221,457	)		(27,500	)
Proceeds from the sale of common stock (including to be issued)		1,665,211			244,420
Proceeds from notes payable to individuals and companies		482,000			-
Proceeds from sale of registered shares - Tangiers Investment Agreement		400,515			-
Proceeds from convertible notes		692,800			971,100
Cash provided by financing activities		2,968,910			1,238,179
Net decrease in cash		44,478			(380,595	)

Cash, beginning of year		5,348			385,943
Cash, end of year	$	49,826		$	5,348

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Interest Paid	$	78,542		$	43,819
Taxes Paid	$	-		$	-

NON-CASH ITEMS
Recognition of lease liability and right of use asset at inception	$	67,938		$	12,066
Recognition of lease liability and right of use asset lease modification	$	-			23,177
Conversion of notes payable and accrued interest for common stock	$	1,700,675		$	496,262
Original issue discount on notes payable and debentures	$	68,333		$	10,000
Recognition of debt discount	$	208,806		$	794,272

	For the Year Ended
	March 31,
		2020			2019
Cash flows from operating activities
Net loss attributable to controlling interest	$	(3,033,290	)	$	(1,097,439	)
Adjustments to reconcile net loss to cash used in operating activities:
Non-controlling interest		-			2,196
Amortization of original issue discount		67,044			13,543
Bad debt Expense		64,146			-
Loss on sale of commodities		-			2,737
Non-cash lease operating lease expense		331			-
Unrealized loss on digital currency		-			3,142
Depreciation and amortization		914			964
Loss on disposal of fixed assets		1,230			907
Non-cash interest		75,960			163,500
Gain (loss) on settlement		-			20,004
Loss (gain) on extinguishment of debt		(113,468	)		27,975
Amortization of debt discount		687,486			58,571
Common stock issued and issuable for services (including stock-based compensation)		569,636			296,705
Gain on disposal of discontinued operation		(4,941	)		-
Legal fees deducted from proceeds of notes payable		24,900			4,500
(Gain) loss on sale of trading securities		(10,000	)		(99,823	)
Unrealized loss (gain) on trading securities		219,200			(223,349	)
(Increase) decrease in assets
Prepaid expenses		(24,435	)		(86,800	)
Inventory		(117,839	)		(10,872	)
Proceeds of trading securities, net		40,000			583,471
Accounts receivable		(106,726	)		-
Increase (decrease) in liabilities
Accounts payable		41,352			10,360
Deferred revenue		384			-
Accrued expenses		46,720			-
Accrued interest		60,834			1,123
Cash used in operating activities		(1,510,562	)		(328,585	)
Cash flows from investing activities
Investment in VTGN warrants		(37,500	)		-
Proceeds (purchase) of digital currency, net		-			16,177
Loan from Officer		50,159
Investment - other		(68,100	)		(72,500	)
Purchase of property and equipment		(2,612	)		(12,390	)
Cash used in investing activities		(58,053	)		(68,713	)
Cash flows from financing activities
Repayment of principal on notes payable to individuals and companies		(27,500	)		(141,000	)
Proceeds from the sale of common stock (including to be issued)		244,420			331,200
Proceeds from convertible notes		971,100			580,750
Cash provided by financing activities		1,188,020			770,950
Net decrease in cash		(380,595	)		373,652
Cash, beginning of year		385,943			12,291
Cash, end of year	$	5,348		$	385,943
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Interest Paid	$	10,904		$	43,819
Taxes Paid	$	-		$	-
NON CASH ITEMS
Recognition of lease liability and right of use asset at inception	$	12,066		$	-
Recognition of lease liability and right of use asset lease modification	$	23,177		$	-
Conversion of notes payable and accrued interest for common stock	$	496,262		$	200,718
Original issue discount on notes payable and debentures	$	10,000		$	-
Recognition of debt discount	$	794,272		$	388,811
Reclassification of other comprehensive income to additional paid in capital	$	-		$	8,042

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

F-65

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN AND GOING CONCERN

~~Nature~~NATURE ofOF ~~Business~~BUSINESS

~~Tauriga~~These ~~Sciences,~~consolidated ~~Inc.~~financial ~~(the~~statements ~~“Company”)~~reflect isall ~~a Florida corporation~~adjustments, ~~with~~including ~~its~~normal ~~principal~~recurring ~~place~~adjustments ~~of business being located at 555 Madison Avenue~~which, ~~fifth~~in ~~floor,~~the ~~New~~opinion ~~York,~~of ~~NY 10022. The Company has~~management, ~~over time, moved into a diversified life sciences technology~~ ~~company,~~are ~~with~~necessary ~~its mission~~ to ~~operate~~present afairly ~~revenue~~the ~~generating~~operations ~~business,~~and ~~while~~cash ~~continuing~~flows tofor ~~evaluate potential acquisition candidates operating in~~ the ~~life~~periods ~~sciences technology space~~presented.

Tauriga Sciences, Inc. (the “Company”) is a Florida corporation, with its principal place of business located at 4 Nancy Court, Suite 4, Wappingers Falls, NY 12590. During October 2020, the Company terminated its primary lease in New York City and established its new corporate headquarters in Wappingers Falls New York, effective January 6, 2021. The Company has, over time, moved into a diversified life sciences technology and consumer products company, with its mission to operate a revenue generating business, while continuing to evaluate potential acquisition candidates operating in the life sciences technology and consumer products spaces.

Tauriga Pharma Corp.

Effective January 2020, the Company amended the certificate of incorporation of Tauriga Business Development Corp. in relevant part to effectuate a name change of this subsidiary to Tauriga Pharma Corp. The principal reason for the name change is to concentrate this subsidiary’s focus on the development of a pharmaceutical product line that is synergistic with the Company’s primary CBD product line. Currently, the plan is to initially create a pharmaceutical line of products to address nausea symptoms related to chemotherapy treatment in patients, which we will submit for clinical trials and to regulatory agencies for approval.

On March 18, 2020, the Company filed a Provisional U.S. Patent Application covering its ~~Pharmaceutical~~pharmaceutical grade version of Tauri-Gum™. This patent application, filed with the United States Patent & Trademark Office (“U.S.P.T.O.”), is titled: “MEDICATED CBD COMPOSITIONS, METHODS OF MANUFACTURING, AND METHODS OF TREATMENT.” The Company’s proposed ~~Pharmaceutical~~pharmaceutical grade ~~version~~ version of Tauri-Gum™ is being developed for nausea regulation, intended specifically to target patients subjected to ongoing chemotherapy treatment(s) (the “Indication”). The delivery system for this ~~Pharmaceutical~~pharmaceutical product is an improved version of the existing “Tauri-Gum™” chewing gum formulation based on continued research and development.

On March 17, 2021, the Company converted its U.S. Provisional Patent Application (filed on March 17, 2020) to a U.S. Non-Provisional Patent Application. This non-provisional patent application relates to the Company’s proposed pharmaceutical cannabinoid chewing gum delivery system for treatment of nausea derived from active chemotherapy treatment.

Also on March 17, 2021, the Company filed an additional U.S. Provisional Patent Application relating to alternative pharmaceutical cannabinoid delivery systems.

On March 17, 2021, the Company filed an International Patent Application under the Patent Cooperation Treaty (“PCT”), a cooperative agreement entered into by more than 130 countries with the purpose of bringing international conformity to the filing and preliminary evaluation of patent applications. This application relates to the Company’s proposed pharmaceutical cannabinoid chewing gum delivery system being developed to treat nausea derived from active chemotherapy treatment.

The PCT application is published by the International Bureau at the World Intellectual Property Organization (“WIPO”), based in Geneva, Switzerland, in one of the ten “languages of publication”: Arabic, Chinese, English, French, German, Japanese, Korean, Portuguese, Russian, and Spanish.

Currently, the pharmaceutical grade version of Tauri-Gum^TM is in the pre-IND stage of development. The development team is working on several parallel workstreams, including:

●	formulation development;

●	non-clinical in vivo and in vitro studies to inform the effective clinical dose and safety margin;

●	regulatory strategy and regulatory documentation preparation;

●	confirmation of the active pharmaceutical ingredient (API); and

●	Identifying pharma-grade API suppliers.

Tauriga Sciences Limited

On June 10, 2019, the Company formed a wholly owned subsidiary, Tauriga Sciences Limited, with the ~~registrar~~Registrar of Companies for Northern Ireland. Tauriga Sciences Limited is a private limited Company. The entity was established in conjunction with e-commerce merchant services. In conjunction to this new entity the Company entered into a two-year lease commencing on June 11, 2019 ~~and expiring on June 30, 2021~~. The office is located at Regus World Trade Centre Muelle de Barcelona, edif. Sur, 2a Planta Barcelona Cataluña 08039 Spain. The Company terminated this lease during October 2020. The Company no longer maintains an office in this region.

Collaboration Agreement with Aegea Biotechnologies Inc.

On April 3, 2020, Tauriga Sciences, Inc. entered into a collaboration agreement (“Collaboration Agreement”) with Aegea ~~Biotechnologies~~ Biotechnologies Inc. (“Aegea”), for the purpose of developing a Rapid, Multiplexed Novel Coronavirus (COVID-19) Point of Care Test with Superior Sensitivity and Selectivity (the “SARS-Col 2 Test”). The parties ~~believe~~believed that the benefits of the SARS-CoV-2 Test ~~are~~were ~~as follows~~the following: a Rapid SARS-CoV-2 test with the sensitivity and specificity to eliminate false negatives and false positives, and with the ability to detect and measure viral shed, even in patients who are asymptomatic. This SARS-CoV-2 test would use Aegea’s patented technologies, to take coronavirus testing to the next level by differentiating different strains of SARS-CoV-2. The test, if successful, would be adaptable to additional SARS-CoV-2 strain types as necessary and as the virus mutates. It also has the possibility to be rapidly be customized to provide similarly sensitive and specific assays for other viruses. The Company ~~has~~ committed to raise funding for the purposes set forth in under the Collaboration Agreement from its $5,000,000 Equity Line of Credit (“ELOC”) ~~beginning~~with Tangiers Global, LLC, which became effective on March 16, 2020. Seventy percent (70%) of the net proceeds from the sale of the initial 10,000,000 shares of stock of Tauriga under the ELOC ~~will~~were be invested in Aegea for the development of the Covid Test and used to purchase shares of common stock of Aegea, at a purchase price of $4.00 per share. The $4.00 stock price corresponds to a current pre-money valuation of Aegea of $25,000,000 for each tranche of cash, up to the first $2,000,000 of our investment in Aegea. Additionally, as part of our agreement with Aegea, on May 26, 2020, Tauriga issued to Aegea 5,000,000 unregistered common shares of Tauriga common stock. On August 10, 2020, the Company and Aegea amended their Collaboration Agreement. Under the terms of the amendment, having invested 70% of the proceeds from the sale of the initial 10,000,000 shares of Tauriga stock under the ELOC with Tangiers, the Company increased the percentage of proceeds it invested in Aegea on the sale of the remaining shares available under the ELOC agreement from 20% to 40%.

F-76

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

NATURE OF BUSINESS (CONTINUED)

Collaboration Agreement with Aegea Biotechnologies Inc. (Continued)

~~Pursuant~~On January to6, ~~the~~2021, ~~terms of the Collaboration Agreement~~however, ~~following~~ the ~~initial~~Company ~~sale~~determined ofto ~~10,000,000~~terminate ~~shares~~its ~~of our common stock under the~~ ELOC, ~~twenty~~by ~~percent~~terminating ~~(20%)~~each of ~~all~~the ~~subsequent~~Investment ~~net~~Agreement ~~proceeds~~and ~~from~~Registration ~~the~~Rights ~~sale~~Agreement, ofand ~~shares~~on ~~under~~January ~~the~~8, ~~ELOC~~2021 ~~shall~~filed bea ~~used~~Post-Effective Amendment to ~~purchase~~its ~~additional~~Form ~~shares~~S-1 ofRegistration ~~common~~Statement ~~stock~~(333-236923) ofwhich ~~Aegea~~removed from atregistration aall ~~purchase~~shares ~~price~~not ofpreviously ~~$4.00 per~~sold ~~share~~thereunder. ~~The~~This ~~$4.00~~effectively ~~stock~~also ~~price~~eliminates ~~corresponds~~our obligation to aany ~~current~~additional ~~pre-money~~funding to ~~valuation of~~ Aegea ofunder ~~$25,000,000~~the ~~for~~Collaboration ~~each~~Agreement. ~~tranche~~As of ~~cash~~March 31, up to2021, the ~~first~~Company had invested $2278,~~000,000~~212 ~~of our investment~~ in Aegea. ~~The~~for ~~valuation~~69,553 ~~will~~shares, berepresenting an ~~reassessed~~ownership ~~and~~percentage ~~reset~~of by1.03%. ~~the~~As ~~parties~~of ~~after~~March ~~the~~31, ~~first $2~~2021,~~000,000~~ resultant delays of ~~Tauriga’s~~project ~~investment~~milestones ishave ~~received~~led bythe ~~Aegea.~~Company Into ~~addition,~~determined asthat full ~~part~~recovery of ~~our~~its ~~agreement~~investment ~~with~~in Aegea, Onis ~~May~~in ~~26,~~doubt ~~2020, Tauriga~~and ~~also~~has ~~issued~~recorded toa ~~Aegea~~50% ~~5,000,000~~impairment ~~unregistered~~loss ~~common~~on ~~shares~~its ofconsolidated ~~Tauriga~~Statement ~~common~~of ~~stock.~~Operations in ~~The~~the ~~Collaboration~~amount ~~Agreement~~of ~~commenced upon~~$139,106. ~~signing~~Aegea ~~and~~is ~~will~~still ~~continue~~moving ~~indefinitely,~~forward ~~unless~~on ~~amended~~this orproject ~~terminated~~and bythe ~~mutual~~Company ~~written~~will ~~agreement~~continue ofto monitor the ~~parties~~progress.

Chief Medical Officer

Master Services Agreement

COMPANY PRODUCTS

~~TAURI~~Tauri-~~GUMTM~~GumTM

In October 2018, the Company’s management, along with its board of directors, began to explore the possibility of launching a cannabidiol (“CBD”) infused gum product line into the commercial marketplace. ~~After several weeks of diligence, discussions with various parties and exploratory meetings, the Company made the determination to move forward with this business opportunity.~~

To begin this process, during the quarter ended December 31, 2018, the Company began discussions with a Maryland based chewing gum manufacturer - Per Os Biosciences LLC (“Per Os Bio”), which consummated in a manufacturing agreement in late December 2018 to launch and bring to market a white label line of CBD infused chewing gum under the brand name Tauri-Gum^TM. In October 2019, we also filed trademark applications for the above-referenced marks in each of the European Union and Canada. On February 18, 2020, the Company received a notice of allowance from the European Union Intellectual Property Office granting the Company its trademark registration for Tauri-Gum™ (E.U. Trademark # 018138334).

F-7

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2021 AND 2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

COMPANY PRODUCTS (CONTINUED)

Tauri-Gum^TM(Continued)

Under the terms of the agreement, Per Os Bio produces Tauri-Gum^TM based on the following criteria:

A. By composition, the CBD Gum will contain 10 mg of CBD ~~Isolate~~isolate; B. The initial production run will be mint flavor; C. This proprietary CBD Gum will be manufactured under U.S. Patent # 9,744,128 (“Method for manufacturing medicated chewing gum without cooling”); D. Each Production Batch, including the initial production run, is estimated to yield 70,000 gum tablets or 8,700 Units (each Unit contains 8 gum tablets); E. Integrated Quality Control Procedures: Each production batch will be tested by a 3rd Party for CBD label content, THC content (0%), and clear for microbiology; F. The packaging, for retail marketplace, will consist of 8 count (gum tablet count) blister card labeled (the “Pack(s)”) with Lot # as well as Expiration Date.; G. Outer sleeve in the Company’s artwork and graphic design(s) and label copy; and H. Shipping System: Bulk packed 266 Packs per master case (“Palletized”).

Under terms of the agreement with Per Os Bio:

A. Each product order will consist of 8,700 Packs (unless otherwise agreed upon by both parties); B. ½ of initial production invoice due within 3 days of execution of Manufacturing Agreement; C. ~~Provide~~We will provide graphic design artwork, logo, and label design to Per Os Bio; D. ToWe implement Kosher Certification Process; E. ~~Procure~~We procure appropriate Product & Liability insurance policy (as of this report date the Company has in effect an $8,000,000 product liability policy); and F. ~~Acquire~~We acquire legal opinion with respect to the confirmation of the legality to sell this CBD Gum on the Federal Statute Level.

The Company’s gum formulation includes distinctive features: allergen free, gluten free, vegan, kosher (K-Star certification), Halal (Etimad certification), Vegan Formulation and incorporates a proprietary manufacturing process. See our “Risk Factors” contained in our Annual Report dated March 31, 2020 filed with the Securities and Exchange Commission on June 29, 2020, including with respect, but not limited, to Federal laws and regulations that govern CBD and cannabis.

The Company’s E-commerce website is www.taurigum.com.

During the fiscal year 2020, the Company added two additional flavors: Blood Orange and Pomegranate.

On August 31, 2020, the Company announced that it has obtained HALAL Certification (Authority: Etimad) for the entirety of its flagship brand Tauri-Gum™. A HALAL Certification is a guarantee that the products comply with the Islamic dietary requirements or Islamic lifestyle.

During the year ended March 31, 2021, the Company received and commenced sales of Peach-Lemon and Black Currant CBG Gum.

Tauri-Gummies™

On November 25, 2019, the Company announced that it has finalized the formulation for its Vegan 25 mg CBD (Isolate) Infused Gummies product to be branded Tauri-Gummies™ for which a trademark was filed in Switzerland and the European Union. The company has received a Notice of Allowance from the European Union Intellectual Property Office (“E.U.I.P.O.”) granting the Company its trademark Registration for: Tauri-Gummies™ (E.U. Trademark # 018138348). The effective registration date, granting this Tauri-Gummies™ trademark to the Company, was June 24, 2020. This product contains no gelatin in the formulation, as the Company has utilized plant-based alternatives in completion of this product. Each bottle contains 4 flavors – cherry, orange, lemon and lime.

Each gummy package contains 24 gummies in a jar, 6 of each flavor, containing 25mg of CBD isolate per individual gummy, or 600 mg of CBD isolate per jar. These Gum Drops have been manufactured in the “Nostalgic” 1950s confectionary style and are both plant-based (Vegan Formulated) and Kosher Certified. The Company commenced sales of Tauri-Gummies™ in January 2020.

In addition, we also received a Notice of Allowance to our Tauri-Gummies^TMregistered trademark application from the European Union Intellectual Property Office. The trademark application was registered on June 24, 2020 under Serial No. 018138351, which extends our protective period for this mark until October 2029, and which may be extended thereafter for ten-year intervals.

F-8

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

~~COMPANY~~NOTE ~~PRODUCTS~~1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

~~TAURI-GUMTM~~COMPANY PRODUCTS (~~Continued~~CONTINUED)

~~The~~Cannabigerol ~~Company’s gum formulation includes distinctive features: allergen free, gluten free, vegan, kosher (K-Star certification), and incorporates a proprietary manufacturing process. See our~~ “~~Risk Factors~~CBG” ~~contained~~Isolate inInfused ~~this~~Version ~~Annual~~of ~~Report, including with respect, but not limited, to Federal laws and regulations that govern CBD and cannabis.~~Tauri-Gum™

The Company’s E-commerce website is www.taurigum.com.

During the fiscal year 2020, the Company added two additional flavors. Blood Orange and Pomegranate.

TAURI-GUMMIES™

On November 25, 2019, the Company announced that it has finalized the formulation for its Vegan 25 mg CBD (Isolate) Infused Gummies product to be branded Tauri-Gummies™ for which a trademark was filed in Switzerland and the European Union. This product contains no gelatin in the formulation, as the Company has utilized plant-based alternatives in completion of this product. Each bottle contains 4 flavors – cherry, orange, lemon and lime.

CANNABIGEROL “CBG” ISOLATE INFUSED VERSION OF TAURI-GUM™

~~DISTRIBUTION~~During OFthe ~~THE~~year ~~COMPANY’S~~ended ~~PRODUCTS~~March 31, 2021, the Company received and commenced sales of Peach-Lemon and Black Currant CBG Gum.

~~E&M~~Immune ~~Distribution~~Booster ~~Agreement~~Version of Tauri-Gum™

On ~~April~~May 129, ~~2019~~2020, the Company ~~entered~~announced ~~into~~that ait ~~distribution~~has ~~agreement~~commenced ~~with~~development ~~E&M~~of ~~Ice~~an ~~Cream~~Immune ~~Company~~Booster ~~(“E&M”)~~version toof ~~establish~~ Tauri-~~GumTM~~Gum™, inwhich ~~the~~commenced sales ~~greater~~during ~~New~~the ~~York~~three ~~City~~months ~~marketplace~~ended ~~(the~~September ~~“E&M~~30, ~~Distribution~~2020. ~~Agreement”), with~~This ~~substantial~~product ~~levels~~contains 60mg of ~~both~~Vitamin ~~financial~~C ~~resources~~ and ~~marketing~~10mg ~~support.~~of ~~The~~Elemental ~~Company~~Zinc ~~had~~(“Zinc”) in ~~both~~each ~~received~~piece ~~payment~~of ~~for~~chewing ~~and~~gum. ~~delivered the~~This product ~~for~~does ~~its~~not ~~previously~~contain ~~announced~~any ~~$54~~phytocannabinoids (i.e.,~~000~~ ~~Tauri-GumTM~~CBD ~~purchase~~or ~~order~~CBG). ~~during~~The ~~March~~Company’s ~~2019~~Immune Booster Tauri-Gum™ product, ~~and~~is: ~~re-orders~~Kosher incertified, ~~the first~~Halal ~~quarter~~Vegan, ofLab-Tested, ~~fiscal~~non-GMO, ~~2020.~~allergen ~~The~~free, ~~Company~~gluten ~~has~~free, ~~agreed~~infused towith ~~issue~~60mg aVitamin C ~~one-time~~& ~~issuance~~10mg ofElemental ~~1,000,000~~Zinc/per ~~restricted~~each ~~shares~~piece of ~~the~~gum, ~~Company’s common~~no ~~stock~~phytocannabinoids, and to100% ~~tender~~made ain ~~one-time~~the ~~cash~~United ~~payment~~States of ~~$125,000 to E&M~~America. This ~~$125,000 cash component~~ product was ~~paid~~developed infor ~~full~~general tousage ~~E&M on~~and ~~April~~as 1,with ~~2019,~~respect ~~and~~to the ~~value~~entirety of the ~~shares~~Company’s isretail ~~reflected in stock~~Tauri-~~based~~Gum™ ~~compensation~~product ~~based on the grant date of April 1~~line, ~~2019.~~there ~~These~~are ~~shares~~no ~~were~~“treatment ~~issued~~claims” ~~on December 26, 2019~~made.

~~Under~~Rainbow ~~the~~Deluxe ~~terms~~Sampler ~~of the E&M Distribution Agreement, the Company issued restricted shares of common stock to E&M for their support services.~~Pack

Other Products

The Company, from time to time, will offer various formats of CBD product through its e-commerce website. As of this report date the Company is currently offering a 70% dark chocolate 20mg CBD non-GMO dietary supplement and 100mg CBD scented bath bombs (Mint, Pomegranate and Blood Orange). The Company’s current offering includes a line of skin care products sold on its ecommerce website under the product line name of Uncle Bud’s. The skin care products include three different 4.2mg CBD facemasks (collagen, detoxifying and tightening masks), 100mg CBD daily moisturizer, 30mg CBD anti-wrinkle dream, hand and foot cream with hemp seed oil, 120mg CBD massage and body oil, 240mg CBD body revive roll-on, 35mg CBD transdermal patch and 120mg CBD body spray. Additionally, on December 1, 2020 the Company announced the commencement of development of a Caffeine infused version of Tauri-Gum™. When production run is complete, this will represent the 7th SKU of the Tauri-Gum™ product line.

Delta 8 Version of Tauri-Gum™

F-9

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

DISTRIBUTION OF THE COMPANY’S PRODUCTS ~~(CONTINUED)~~

E&M Distribution Agreement

On April 1, 2019, the Company entered into a distribution agreement with E&M Ice Cream Company (“E&M”) to establish Tauri-Gum^TM in the greater New York City marketplace (the “E&M Distribution Agreement”), with substantial levels of both financial resources and marketing support. The Company had both received payment for and completed an initial delivery of $54,000 of Company product to E&M in March 2019, and re-orders in the first quarter of fiscal 2020. In connection with the E&M Distribution Agreement, the Company issued 1,000,000 restricted shares of the Company’s common stock and tendered a one-time cash payment of $125,000 to E&M for early-stage marketing and distribution support services. This $125,000 cash component was paid in full to E&M on April 1, 2019, and the value of the shares is reflected in stock-based compensation based on the grant date of April 1, 2019. These shares were issued on December 26, 2019.

South Florida Region Distribution Agreement

~~Under~~Northeastern ~~terms~~United ofStates ~~this IRM~~ Distribution Agreement, the Company will work closely with IRM to promote Tauri-Gum™. In connection with this IRM Distribution Agreement, the Company has also agreed to a one-time issuance of 450,000 shares of the Company’s restricted common stock and a cash stipend of $10,000 to IRM. As of the date of this report, $6,000 of the $10,000 cash stipend has been paid. The value of the shares was reflected as stock-based compensation based on the grant date of April 8, 2019.

In connection with the SKL Agreement, the Company had agreed to issue a one-time issuance of an aggregate of 1,000,000 restricted common shares the Company’s stock, which are subject to the customary resale and transfer restrictions imposed under the rules and regulations of the Securities and Exchange Commission. The restricted equity issuance to SKL was issued in accordance with the following schedule: (i) to Mr. Mahesh Lekkala, 500,000 restricted shares the Company’s common stock within ten (10) business days of April 30, 2019; and (ii) to SKL, 500,000, which were permitted to be immediately allocated by SKL to persons within its organization and, as such, (a) 250,000 of such shares shall be issued to SKL within ten (10) business days of April 30, 2019, and the additional issuance of (b) 250,000 of such shares shall be issued to SKL within ten (10) business days of August 1, 2019, which shares were issued on August 1, 2019. Other than the payment terms for Tauri-GumTM product purchased and distributed under the terms of the Agreement, there is no additional cash payment currently due or owing by the Company thereunder. The value of the shares is reflected as stock-based compensation with a grant date of April 30, 2019. All but 250,000 shares are expensed on this date, with those 250,000 shares valued over the term of the one-year agreement. This agreement expired on April 30, 2020.

On May 11, 2019, the Company also entered into a consulting agreement pursuant to the terms of the SKL agreement, whereby Ms. Neelima Lekkala was appointed Vice President of Distribution & Marketing. This agreement had a one-year term and expired on May 11, 2020. Ms. Lekkala focused her efforts on the expansion of Tauri-GumTM in terms of gross sales and revenue growth through the acquisition of new customers, establishment of professional marketing materials & protocols, logistics improvement(s) and fulfillment services. Ms. Lekkala was not an executive officer of the Company and, therefore, was not deemed to be an affiliate of the Company. Ms. Lekkala’s compensation included restricted shares of the Company’s common stock, which were fully earned and vested upon the execution of her consulting agreement. Additionally, Ms. Lekkala was entitled to receive a 30% commission on total gross sales through the sale of the Tauri-GumTM product line, which the Company was permitted to pay in either stock or cash at the election of Ms. Lekkala. As of March 31, 2020, Ms. Lekkala earned commission in the amount of $1,023.

Windmill Health Distribution Agreement

~~These~~Mr. ~~arrangements~~Checkout ~~are~~Distribution ~~more fully described in our periodic and current reports that we have filed with the Securities and Exchange Commission and included in these agreements filed by reference as exhibits thereto.~~Agreement

On June 29, 2020, the Company entered into a “Go-To-Market” distribution agreement with Mr. Checkout Distributors (“Mr. Checkout”), a marketing and consulting company located in Oviedo, Florida. The Mr. Checkout agreement enables the Company to launch its flagship brand Tauri-Gum™ through Mr. Checkout’s network of independent direct store distributors that service approximately 150,000 stores and retail locations across the United States. These stores include well-known convenience stores, gas station marts and supermarket chains. Under the terms of this agreement, on July 7, 2020, the Company paid a one-time $5,000 retainer on commission against the first $100,000 in sales. Subsequent commissions shall be paid to Mr. Checkout during the first thirty (30) days of the subsequent quarter once retainer has been met and exceeded. Commission will not be paid until the retainer has been met. As of March 31, 2021, the Company has recognized no sales via this agreement.

F-10

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

DISTRIBUTION OF THE COMPANY’S PRODUCTS (CONTINUED)

InThink ~~connection with the issuances of any restricted securities by the Company regarding the above-described distribution agreements or other agreements described in this annual report~~BIG, ~~please~~LLC ~~see~~License ~~Part II, Item 5, Unregistered Sales of Equity Securities for additional information.~~Agreement

~~Resale~~On September 24, 2020, we entered into (i) a License Agreement (“License”) with OGThink ~~LABORATORIES~~BIG, LLC, a Los Angeles based company (“Think BIG”), (ii) a Professional Services Agreement (the “PSA”) with Willie C. Mack, Jr., CEO of Think BIG and (iii) a Professional Services Agreement (“PSA 2”) with Christopher J. Wallace, a co-founder of Think BIG (each of Willie C. Mack, Jr. and Christopher J. Wallace referred to herein as a “Brand Ambassador”), with the collective intent to enhance sales and marketing of the Company’s product lines, including its proprietary Rainbow Deluxe Sampler Pack (“Rainbow Pack”), and any co-branded products created by the parties to the License and each of the PSAs (the “Co-Branded Products”).

OnThe ~~January~~term ~~21,~~of ~~2020, the Company entered into a joint venture agreement with OG LABORATORIES, LLC (“OG”). Under~~ this ~~agreement~~license ~~the~~is ~~Company~~for ~~will act as~~ a ~~wholesaler~~period of ~~OG’s~~two ~~product~~years ~~labeled~~from ~~under~~September ~~OG’s~~24, ~~name. We~~2020 ~~are~~(the ~~currently wholesaling two of OG’s products:~~ “~~Omega-3~~Effective ~~Heart Wellness+CBD~~Date”), ~~and~~unless ~~“Collagen~~earlier ~~Skin Wellness+CBD”.~~terminated ~~Both~~by ofeither ~~these~~party ~~products~~pursuant ~~will~~to ~~be offered on~~ the ~~Company’s~~terms ~~website~~thereunder. The ~~Company~~term ~~will~~of beeach ~~compensated~~of ~~for sales generated through its efforts according~~ the ~~following~~PSA ~~formula:~~and the ~~Company~~PSA 2 shall ~~receive,~~commence noon ~~later than 30 days after collection,~~ the ~~following percentage~~Effective ofDate the total order amount for third-party customers who purchase OG products that Tauriga originated or derived: for aggregate purchases greater than one hundred thousand dollars ($100,000.00), Tauriga shall receive commission of three and ~~a half~~ ~~percent~~end ~~(3.5%),~~on ~~and~~the ~~for~~earlier ~~aggregate purchases~~ of ~~one hundred thousand dollars~~ (~~$100,000.00~~i) orthe ~~less,~~two-year ~~Tauriga~~anniversary ~~shall~~thereof; ~~receive commission of five percent~~ (5%ii). ~~. Tauriga shall receive~~ the ~~above-referenced~~termination ~~commission~~for onany ~~such~~reason ~~sales~~of ~~as long as~~ the ~~sale~~License; ~~is made while the contract is in force~~ or ~~within six~~ (6iii) ~~months after~~ the ~~contract’s~~ earlier termination. ~~The OG agreement may be terminated by either party with thirty days~~ of ~~prior~~the ~~written~~PSA ~~notice~~Agreement pursuant to the ~~other~~terms ~~party~~thereunder. ~~The Company made an initial purchase of OG inventory of $3,050 for e-commerce fulfillment.~~

Stock Up Express Agreement

These arrangements are more fully described in our periodic and current reports that we have filed with the Securities and Exchange Commission and included in these agreements filed by reference as exhibits thereto.

F-11

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2021 AND 2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

REGULATORY MATTERS

Food and Drug Administration

Though the Farm Bill removed industrial hemp from the Schedule I list, the Farm Bill preserved the regulatory authority of the FDA over ~~cannabis~~ cannabis and cannabis-derived compounds used in food and pharmaceutical products under the Federal Food, Drug, and Cosmetic Act (FD&C Act) and section 351 of the Public Health Service Act. The FDA has been clear that it intends to use this authority to regulate cannabis and cannabis-derived products, including CBD, in the same manner as any other food or drug ingredient. In addition to holding the hearing, the agency had requested comments by July 2, 2019 regarding any health and safety risks of CBD use, and how products containing CBD are currently produced and marketed, which comment period was concluded on July 16, 2019. As of the date hereof, the FDA has taken the position that it is unlawful to put into interstate commerce food products containing hemp derived CBD, or to market CBD as, or in, a ~~dietary~~ dietary supplement. Furthermore, since the closure of the FDA hearings on this issue, some state and local agencies have issued a ban on the sale of any food or beverages containing CBD. ~~H.R.~~There ~~5587,~~have abeen ~~newly introduced~~ legislative ~~effort~~efforts at the federal level, ~~seeks~~which toseek ~~consider hemp-derived CBD and substances containing hemp-derived CBD~~ to ~~be dietary supplements under the FD&C Act, which would likely resolve ambiguity and~~ provide clear guidance to industry stakeholders ~~about~~regarding how to comply with applicable FDA law~~. However,~~ ~~H.R.~~with ~~5587~~respect ~~was~~to ~~only~~CBD ~~recently~~and ~~introduced~~other inhemp ~~the~~derived ~~House~~cannabinoids. ~~of Representatives~~However, such legislative efforts have been limited and isas inof ~~its~~this ~~infancy~~date, ~~requiring~~these legislative efforts require extensive further approvals, ~~including~~ including approval offrom ~~the~~both ~~House~~houses of ~~Representatives,~~Congress ~~the Senate~~ and the President of the United States, before being enacted into law, if at all.

Furthermore, with respect to Company’s developing CBG and additional cannabinoid product ~~line~~lines, the FDA has provided no guidance as to how cannabinoids other than CBD (~~sch~~such as CBG) shall be regulated under the FD&C Act, and it is unclear at this time how such potential regulation could affect the results of the operations or prospects of the Company or this product line.

~~F-11~~FDA Clinical Trial Process – United States Drug Development

F-12

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

~~Food~~REGULATORY ~~and Drug Administration~~MATTERS

~~See~~FDA ~~our~~Clinical ~~Risk~~Trial ~~Factors~~Process ~~for~~– ~~more~~United ~~information~~States ~~about~~Drug ~~these~~Development ~~items, as well as certain related disclosures included our Results of Operations under the heading “Going Concern”.~~(Continued)

The process required by the FDA before a drug may be marketed in the United States generally involves the following:

● completion of extensive pre-clinical in vitro and animal studies to evaluate safety and pharmacodynamic effects , formulation development, analytical method development, and manufacturing of the active pharmaceutical ingredient (API) and drug product for clinical trials in accordance with applicable regulations, including the FDA’s Current Good Laboratory Practice (cGLP) regulations and Current Good Manufacturing Practice (cGMP) regulations;

● submission to the FDA of an Investigational New Drug (IND) application, which must become effective before human clinical trials may begin;

● performance of adequate and well-controlled human clinical trials in accordance with an applicable IND and other clinical study related regulations, sometimes referred to as Current Good Clinical Practice (cGCPs), to establish the safety and efficacy of the proposed drug for its proposed indication, and API and drug product scale-up for registration batch production and stability;

● submission to the FDA of a New Drug Application (NDA);

● satisfactory completion of an FDA pre-approval inspection of the manufacturing facility or facilities at which the product, or components thereof, are produced to assess compliance with the FDA’s cGMP requirements;

● potential FDA audit of the clinical trial sites that generated the data in support of the NDA; and

● FDA review and approval of the NDA prior to any commercial marketing or sale.

F-13

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2021 AND 2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

REGULATORY MATTERS

FDA Clinical Trial Process – United States Drug Development (Continued)

● Phase 1. The product is initially introduced into a small number of healthy human subjects or patients and tested for safety, dosage tolerance, absorption, metabolism, distribution and excretion and, if possible, to gain early evidence on effectiveness. In the case of some products for severe or life-threatening diseases, especially when the product is suspected or known to be unavoidably toxic, the initial human testing may be conducted in patients.

● Phase 2. Involves clinical trials in a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage and schedule.

● Phase 3. Clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically dispersed clinical trial sites. These clinical trials are intended to establish the overall risk/benefit relationship of the product and provide an adequate basis for product labeling.

F-14

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2021 AND 2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

REGULATORY MATTERS

FDA Clinical Trial Process – United States Drug Development (Continued)

NDA and FDA Review Process

F-15

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2021 AND 2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

REGULATORY MATTERS

NDA and FDA Review Process (Continued)

New York State Department of Health

These regulations came into effect on January 1, 2021, and all “cannabinoid hemp processors” and “cannabinoid hemp retailers” operating within the state of New York must be licensed by the NYDPH. The regulations expressly allow for food and beverages to contain “cannabinoids”, so long as such products meet certain requirements. To this end, the Company has submited its license application with the NYDPH in compliance with this legislation. These regulations are evolving and the NYDPH recently issued a set of proposed regulations to address the use of industrial hemp derived Δ8- Tetrahydrocannabinol (Δ8 THC) and Δ10- Tetrahydrocannabinol (Δ10 THC) in cannabinoid hemp products manufactured and sold in New York. These proposed regulations are currently in a public comment period, and it is unclear at this time as to what the final regulations to be implemented will include.

F-16

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2021 AND 2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

REGULATORY MATTERS

New York State Department of Health (Continued)

See our Risk Factors and going concern opinion in this report for more information about these items, as well as certain related disclosures included our Results of Operations under the heading “Going Concern”.

OTHER BUSINESS ITEMS

2019 Increase in Authorized Shares

Certified by Wal-Mart, Inc. to become a Domestic Supplier

Approval to Operate Global Seller Account by Alibaba Group

F-17

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2021 AND 2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

OTHER BUSINESS ITEMS (CONTINUED)

Certified as Affiliate Vendor by The National Association of College Stores

Investment Agreement and Registration Rights Agreement

On January 21, 2020, the Company entered into a $5,000,000 equity line financing agreement (“Investment Agreement”) with ~~Tangiers~~ Tangiers Global, LLC (“Tangiers”), as well as a registration right agreement related thereto (“Registration Rights Agreement”). The term of the financing is over a period of 36 months. Pursuant to the Registration Rights Agreement, a maximum of 76,000,000 shares of our Common Stock may be sold to Tangiers from time to time , which ~~have been~~were registered on our Form S-1 Registration Statement, ~~which~~and ~~was~~ declared effective by the Securities and Exchange Commission on March 16, 2020.

~~F-12~~Subject to the terms and conditions of the equity line documents, from time to time, the Company was, at its sole discretion, permitted to deliver put notices to Tangiers which states the number of shares that the Company intends to sell to Tangiers on a closing date. The maximum amount of shares of common stock that the Company was entitled to put to Tangiers per any applicable put notice was the amount of shares up to or equal to two hundred percent (200%) of the average of the daily trading volume (U.S. market only) of the common stock for the ten (10) consecutive trading days immediately prior to the applicable put notice date (the “Put Amount”) so long as such amount is at least five thousand dollars ($5,000) and did not exceed three hundred fifty thousand dollars ($350,000), as calculated by multiplying the Put Amount by the average daily VWAP for the ten (10) consecutive trading days immediately prior to the applicable put notice date. The “Purchase Price” of the shares of our Common Stock that we were able to sell to Tangiers was 88% of the lowest VWAP of the common stock during the five (5) consecutive Trading Days including and immediately following the applicable to the put notice.

F-18

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

OTHER BUSINESS ITEMS (CONTINUED)

Investment Agreement and Registration Rights Agreement (Continued)

~~Subject~~As ~~to the terms and conditions~~ of ~~the~~March ~~equity~~31, ~~line documents~~2021, ~~from~~we ~~time~~had toissued ~~time~~13, ~~the Company may~~910,000 ~~in its sole discretion, deliver a Put Notice to Tangiers which states the number of~~ shares ~~that the Company intends to sell to Tangiers on a closing date. The maximum amount~~ of ~~shares of~~ Common Stock ~~that~~in ~~the~~exchange ~~Company~~for ~~shall be entitled to put to Tangiers per any applicable Put Notice shall be~~ an ~~amount~~aggregate of shares up to or equal to two hundred percent (200%) of the average of the daily trading volume (U.S. market only) of the Common Stock for the ten (10) consecutive Trading Days immediately prior to the applicable Put Notice Date (the “Put Amount”) so long as such amount is at least Five Thousand Dollars ($5400,~~000)~~514 ~~and~~under ~~does~~this ~~not~~equity ~~exceed~~line ~~Three Hundred Fifty Thousand~~of ~~Dollars~~credit ~~($350,000), as calculated by multiplying the Put Amount by the average daily VWAP for the ten (10) consecutive Trading Days immediately prior to the applicable Put Notice Date~~facility. The ~~“Purchase~~final ~~Price”~~put ofnotice ~~the~~was ~~shares~~issued ofOctober our Common Stock that we may sell to Tangiers will be 88% of the lowest VWAP of the Common Stock during the five (5) consecutive Trading Days including and immediately following the applicable to the Put Notice1, provided, however, an additional 10% will be added to the discount of each Put if (i) the Company is not DWAC eligible and (ii) an additional 15% will be added to the discount of each Put if the Company is under DTC “chill” status on the applicable Put Notice Date2020.

The closing of a purchase by Tangiers of the shares specified by us in the Put Notice will occur on the date which is no earlier than five and no later than seven trading days following the date Tangiers receives the Put Notice. On ~~a closing date we will sell~~ toJanuary ~~Tangiers~~6, ~~the~~2021, ~~shares of our common stock specified in~~ the ~~Put~~Company ~~Notice,~~determined ~~and Tangiers will pay us an amount equal~~ to ~~the~~terminate ~~Purchase Price~~its ~~multiplied~~equity byline ~~the number~~ of ~~shares~~credit ~~specified~~facility inby ~~the~~terminating ~~Put~~each ~~Notice. As~~ of ~~March 31, 2020,~~ the ~~Company~~Investment ~~has exercised no~~Agreement ~~put~~and ~~options~~Registration ~~under~~Rights ~~this agreement; however~~Agreement, ~~subsequent~~and toon ~~the~~January ~~end of our fiscal year~~8, we2021 ~~have~~filed ~~issued~~a ~~5,750,000~~Post-Effective ~~shares~~Amendment ofto ~~Common Stock~~its inForm ~~exchange~~S-1 ~~for~~Registration anStatement ~~aggregate~~(333-236923) removing offrom ~~$154,418~~registration asall ofshares ~~the date~~ of ~~filing~~common ofstock ~~this~~not ~~annual~~previously ~~report~~sold thereunder.

Whole Foods Market, Inc. Registration

Federal Award Management Registration

KushCo Holdings, Inc.

HISTORICAL BUSINESS ITEMS

Cupuaçu Butter Lip Balm

On December 23, 2016, the Company entered into a non-exclusive, 12-month license agreement (the “License Agreement”) with Cleveland, Ohio based cosmetics products company Ice + Jam LLC (“Ice + Jam”) to market Ice + Jam’s proprietary cupuaçu butter lip balm, sold under the trademark HerMan® which launched during the quarter ended December 31, 2017. During February of 2018, the Company’s strategy with respect to the HerMan® product was negatively impacted by a series of product defects relating to the twisting mechanism of the lip balm tube. As a result of this and the concomitant halting of selling efforts, the Company had no sales of the HerMan® product during the year ended March 31, 2019. The Company has removed the product from the website and the remaining inventory was written-off as it was determined that the units were not usable. The Company has discontinued this operation as of March 31, 2019.

Honeywood

Following the termination of a proposed 2014 merger between the Company and California-based Honeywood LLC (“Honeywood”), a ~~developer~~ developer of a topical medicinal cannabis product, on August 1, 2017, the Company entered into a ~~Debt~~debt ~~Conversion~~conversion ~~Agreement~~agreement, whereby the Company agreed to convert an $170,000 note receivable due from Honeywood, including accrued interest into a 5% membership interest in Honeywood. At the time of the Honeywood ~~Conversion~~debt ~~Agreement~~conversion agreement, the receivable balance under the Note of $199,119 had been fully written off by the Company in a prior period. As a result of the ~~Honeywood~~debt ~~Conversion~~conversion ~~Agreement~~agreement, the Company deemed the investment to have no current value.

~~F-13~~Pilus Energy

F-19

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

~~HISTORICAL~~NOTE ~~BUSINESS~~1 ~~ITEMS~~– BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

~~Pilus~~HISTORICAL ~~Energy~~BUSINESS ITEMS (CONTINUED)

Blink Charging Company

OnGOING June 29, 2018, the Company purchased four BLINK Level – 2 - 40” pedestal chargers for permanent placement in a retail location or locations whereby the Company will pay a variable annual fee based on 7% of total revenue per charging unit. The rest of the proceeds will be split 80/20 between the Company and the host location owner or its assignee. The host location owner will pay for the cost of providing power to these unit as well as installation costs. As of March 31, 2020, we have not installed any of these machines in any locations, and no revenue has been generated through the Blink contract. Management has not made any decision regarding placement of these units at this time. The Company has not decided to abandon this business line, and therefore, we have not reclassified these assets as held for sale.CONCERN

~~Going~~During ~~Concern~~the fourth quarter of the year ended March 31, 2019, the Company began sales and marketing efforts for its Mint flavored Tauri-GumTM product. During the year ended March 31, 2021, the Company recognized net sales of $285,319 and a gross profit of $122,692, compared to net sales of $239,388 and a gross profit of $54,235 for the same period during the same period in the prior year. At March 31, 2021, the Company had a working capital surplus of $1,291,211 compared to a working capital deficit of $334,832 for the year ended March 31, 2020. The improvement is largely resultant from increased inventory levels and an increase in value of trading securities. Although the Company has a working capital surplus, there is no guarantee that this will continue therefore it still believes that there is uncertainty with respect to continuing as a going concern.

~~During~~On July 1, 2019, months after the ~~fourth~~NYC ~~quarter~~Department of ~~the~~Heath ~~year~~announced ~~ended~~a ~~March~~ban ~~31,~~on ~~2019~~cannabidiol in foods and beverages (mainly focused on restaurants and baked goods), the ~~Company~~result ~~began~~of ~~sales~~which ~~and~~was ~~marketing~~that ~~efforts~~the ~~for~~updated ~~its~~New ~~Mint~~York ~~flavored~~City ~~Tauri~~Health Code now includes an embargoing of CBD-~~GumTM~~infused Edible(s) ~~product~~Products (including packaged products). ~~During~~The Company is hopeful that due to the ~~three~~recent ~~months~~regulatory ~~ended~~regime ~~March~~for ~~31,~~cannabinoid ~~2019~~products implemented by the NYDPH, the New York City Council will remove the current CBD ban and implement regulations surrounding CBD products in a logical and prompt manner. The Company ~~recognized~~believes ~~sales~~it ofis ~~$57~~well positioned under the current regulatory structure,~~134~~ and has taken a ~~gross~~conservative ~~profit~~approach towards ofits ~~$20~~products,~~006~~ including, ~~which~~ ~~has~~for ~~continued~~example, ~~during~~ensuring ~~the~~that ~~year~~its ~~ended~~product ~~March~~manufacturer ~~31,~~periodically ~~2020~~tests ~~where~~for ~~the~~compliance ~~Company~~with ~~recognized~~the ~~revenue~~Agricultural Improvement Act of ~~$234~~2018,~~389~~ ~~and~~such aas ~~gross~~utilizing ~~profit~~CBD ~~of $37,212~~oils from hemp plants which contain 0.3% ~~During~~or ~~the~~less ~~year~~THC ~~ended~~content. ~~March~~Subsequent ~~31,~~to ~~2020~~the balance sheet date, the ~~Company~~State ~~has~~of ~~entered~~New ~~into~~York ~~multiple~~has ~~distribution~~determined ~~agreements,~~that it is ~~approved~~allowable ~~and provisioned~~ to sell toCBD ~~many~~Infused ~~large~~Edible ~~retailers~~products in the forms of both food and drink ~~ecommerce~~(inclusive ~~platforms~~of chewing gum). ~~The~~It ~~Company~~was ~~has~~also ~~engaged~~determined anthat ~~independent~~no ~~contractor~~time tocan ~~act as~~CBD ~~Vice~~be ~~President~~sold ofin ~~Distribution~~products ~~and~~that ~~Marketing.~~contain Ateither ~~March~~alcohol ~~31,~~or ~~2020~~tobacco. Additionally, the ~~Company~~State ~~had~~of aNew ~~working~~York ~~capital~~also ~~deficit~~said ofthat ~~$334,832, resultant~~NO ~~largely~~CBD ~~from~~product ~~convertible~~may ~~notes~~be ~~payable~~sold ~~and~~if ait ~~liability~~contains tomore ~~issue~~than ~~common~~0.3% ~~stock~~(1/333rd by Composition) THC. ~~Although~~No ~~the~~Individual ~~Company~~food ~~expects~~or ~~that the~~beverage ~~deficit~~product ~~will~~may becontain ~~remedied~~more bythan ~~repayment~~25mg inof ~~cash~~Hemp-Extracted Cannabinoids (“CBD” or ~~the~~“CBG”) per ~~conversion~~serving. ofFood ~~notes~~and ~~into~~drink ~~common~~infused ~~stock~~with ~~shares~~CBD asand ~~well~~Other asHemp ~~the~~Extracts ~~issuance of~~must ~~shares~~be ~~for~~packaged ~~which~~by the ~~Company~~manufacturer isand ~~obligated,~~extracts itcannot ~~still~~be ~~believes~~added at ~~that~~the ~~there~~retail islevel. ~~uncertainty~~The ~~with~~Company’s ~~respect~~entire toproduct ~~continuing~~line aswill acomply ~~going concern~~with these standards.

OnThe ~~July 1~~Company, ~~2019,~~in ~~months after~~ the ~~NYC~~short ~~Department~~term, ofintends ~~Heath~~to ~~announced~~continue afunding ~~ban on~~its ~~cannabidiol~~operations ineither ~~foods~~through ~~and beverages (mainly focused~~ cash-on-hand ~~restaurants~~or ~~and~~through ~~baked~~financing ~~goods),~~alternatives. Management’s ~~the~~plans ~~updated~~with ~~New~~respect ~~York~~to ~~City~~this ~~Health~~include ~~Code~~raising ~~now~~capital ~~includes~~through anequity ~~embargoing~~markets ofto ~~CBD-infused~~fund ~~Edible(s)~~future ~~Products (including~~operations ~~packaged products). The Company is hopeful that the FDA~~ as well as the possible ~~New~~sale ~~York~~of ~~City~~its ~~Council~~remaining ~~will~~marketable ~~implement~~securities ~~regulations surrounding~~which ~~the~~had ~~CBD industry in~~ a ~~logical~~market ~~and~~value ~~prompt manner. The FDA’s uncertainty surrounding CBD was the initial cause~~ of ~~the~~$1,246,050 ~~New~~at ~~York~~March ~~City ban~~31, ~~and~~2021. weIn ~~believe~~the ~~further~~event ~~clarification from~~ the ~~FDA supporting its safety and regulating its labeling~~Company ~~will~~cannot ~~also~~raise ~~offer~~additional acapital ~~clearer pathway~~ to ~~the~~fund ~~New~~and/or ~~York~~expand ~~City~~operations ~~CBD~~or ~~market.~~fails ~~The~~to ~~Company~~raise ~~believes~~adequate itcapital ~~is well positioned under the circumstances~~ and ~~has~~generate ~~taken~~adequate asales ~~conservative approach towards its products~~revenue, or ~~including,~~if ~~for~~the ~~example,~~regulatory ~~ensuring~~landscape ~~that~~were ~~its~~to ~~product~~become ~~manufacturer~~more ~~periodically tests~~difficult ~~for~~or ~~compliance~~result ~~with~~in ~~the~~regulatory ~~Agricultural Improvement Act of 2018~~enforcement, ~~such~~it ascould ~~utilizing~~result ~~CBD~~in ~~oils~~the ~~from~~Company ~~hemp~~having to ~~plants~~curtail ~~which~~or ~~contain 0%~~cease ~~THC content~~operations.

F-1420

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 1 – BASIS OF OPERATIONS AND GOING CONCERN (CONTINUED)

GOING CONCERN (~~Continued~~CONTINUED)

~~The~~Additionally, even if the Company ~~remains~~does ~~confident~~raise ~~that~~sufficient ~~this~~capital ~~embargo~~to onsupport ~~CBD~~its ~~Edible(s)~~operating ~~products~~expenses and generate adequate revenues in the short term, there can be no assurances that the revenues will be ~~lifted~~sufficient to enable it to develop business to a level where it will generate profits and~~/or~~ ~~clarified~~cash inflows ~~the~~from ~~future~~operations to achieve profitability thereby eliminating its reliance on alternative sources of funding. InAlthough management believes that the ~~interim~~Company continues to strengthen its financial position over time, there is still no guarantee that profitable asoperations awith ~~result~~sufficient cashflow to sustain operations can or will be achieved without the need of ~~this~~alternative ~~embargo~~financing, ~~the~~which ~~Company~~is limited. ~~has~~These ~~taken~~matters still raise significant doubt about the ~~necessary~~Company’s ~~steps~~ability to ~~ensure~~continue as a going concern as determined by management. The Company believes that ~~their~~there ~~marketing~~is ~~efforts~~uncertainty ~~are~~with ~~focused~~respect onto ~~areas~~continuing as a going concern until the operating business ~~outside~~can achieve sufficient sales to maintain profitable operations and sustain cash flow to operate the Company for a period of ~~New~~twelve ~~York~~months. In ~~City~~the event the Company does need to raise additional capital to fund operations or engage in a transaction, ~~while~~failure ~~maintaining~~to ~~its~~raise ~~physical~~adequate capital ~~presence~~and generate adequate sales revenues could result in ~~New~~the ~~York~~Company ~~City~~having to curtail or cease operations.

~~The~~Even if the Company does raise sufficient capital to support its operating expenses, acquire new license agreements or ownership interests in ~~the~~life ~~short~~science ~~term~~companies and generate adequate revenues, ~~intends~~or tothe ~~continue~~agreements ~~funding~~entered ~~its~~into ~~operations~~recently ~~either~~are ~~through~~successful, ~~cash-on-hand~~there orcan ~~through~~be ~~financing~~no ~~alternatives.~~assurances ~~Management’s~~that ~~plans~~the ~~with~~revenues ~~respect~~will tobe ~~this~~sufficient ~~include~~to ~~raising~~enable ~~capital~~it ~~through~~to ~~equity~~develop ~~markets~~business asto ~~well~~a aslevel ~~through~~where ~~its~~it ~~equity~~will ~~line with~~generate ~~Tangiers~~profits toand ~~fund~~cash ~~future~~flows from operations. These asmatters ~~well~~raise assubstantial doubt about the ~~possible~~Company’s ~~sale~~ability ofto ~~its~~continue ~~remaining~~as ~~marketable~~a ~~securities~~going ~~which~~concern ~~had~~as adetermined ~~market value~~by ofmanagement. ~~$101~~However,~~200~~ the ataccompanying ~~March~~consolidated ~~31,~~financial ~~2020.~~statements Inhave ~~the~~been ~~event~~prepared ~~the~~on ~~Company~~a ~~cannot~~going ~~raise~~concern ~~additional~~basis, ~~capital~~which tocontemplates ~~fund~~the realization of assets and~~/or~~ ~~expand~~satisfaction ~~operations or~~of ~~fails~~liabilities toin ~~raise~~the ~~adequate~~normal ~~capital~~course ~~and~~of ~~generate~~business. ~~adequate~~These ~~sales~~consolidated ~~revenue,~~financial orstatements ifdo ~~the~~not ~~regulatory~~include ~~landscape~~any ~~were~~adjustments relating to ~~become~~the ~~more~~recovery ~~difficult~~ of the recorded assets or ~~result~~the inclassification ~~regulatory~~of ~~enforcement,~~the itliabilities ~~could~~that ~~result~~might inbe necessary should the Company ~~having~~be unable to ~~curtail~~continue oras ~~cease~~a ~~operations~~going concern.

~~Additionally,~~In ~~even~~an ifeffort to support the Company’s ~~does~~future ~~raise sufficient~~ capital toneeds, ~~support~~on ~~its~~January ~~operating~~21, ~~expenses~~2020, ~~and~~the ~~generate~~Company ~~adequate~~entered ~~revenues~~into ina ~~the short term~~$5,000,000 ~~there~~equity ~~can~~line financing beagreement nowith ~~assurances~~Tangiers, ~~that~~as ~~the~~well ~~revenues~~as ~~will~~a beregistration ~~sufficient~~right toagreement ~~enable~~related itthereto. toThe ~~develop~~financing ~~business~~is toover a ~~level~~maximum ~~where~~of it36 ~~will~~months. ~~generate~~Pursuant ~~profits~~to ~~and~~the ~~cash~~Registration ~~flows~~Rights ~~from~~Agreement, ~~operations~~a tomaximum ~~achieve~~of ~~profitability~~76,000,000 ~~thereby~~shares ~~eliminating~~of ~~its~~our ~~reliance~~common onstock, ~~alternative~~par ~~sources of~~value ~~funding~~$.00001 ~~Although~~per ~~management~~share ~~believes~~ that ~~the~~we may ~~Company~~sell isto inTangiers afrom ~~stronger~~time ~~position~~to ~~than~~time itwill ~~has~~be ~~been~~registered inby inus ~~several~~on ~~years,~~Form ~~there is~~S-1 ~~still no guarantee that profitable operations~~ with ~~sufficient~~the ~~cashflow~~Securities toand ~~sustain~~Exchange ~~operations~~Commission ~~can~~under orthe ~~will be achieved without~~Securities ~~the~~Act ~~need~~ of ~~alternative~~1933, ~~financing~~as amended, ~~which~~for isthis ~~limited~~financing. ~~These~~As ~~matters~~a ~~still~~result ~~raise~~of ~~significant doubt about~~ the Company’s ~~ability to~~Collaboration ~~continue~~Agreement aswith aAegea, ~~going~~whereby ~~concern~~seventy aspercent (70%) ~~determined~~of bythe ~~management.~~Net ~~The~~Proceeds ~~Company~~from ~~believes~~the ~~that~~sale ~~there~~of isthe ~~uncertainty~~initial ~~with~~10,000,000 ~~respect~~shares toof ~~continuing as~~stock aof ~~going~~Tauriga ~~concern~~using ~~until~~ the ~~operating~~ELOC ~~business~~were ~~can~~transferred ~~achieve sufficient sales~~ to ~~maintain profitable operations~~ and ~~sustain cash~~invested ~~flow~~in toAegea ~~operate~~for the ~~Company~~purchase ~~for~~of acommon ~~period~~stock of ~~twelve months~~Aegea. InAdditionally, the ~~event the~~ Company ~~does~~has ~~need~~excluded to4,000,000 ~~raise~~shares ~~additional~~under ~~capital~~this agreement to ~~fund~~cover ~~operations~~liabilities orand ~~engage~~expenses inrelated ~~a transaction, failure~~ to ~~raise~~the ~~adequate~~establishment ~~capital~~ and ~~generate~~maintenance ~~adequate~~of ~~sales~~this ~~revenues~~agreement. ~~could~~(See ~~result~~earlier in ~~the~~ ~~Company~~this ~~having~~Note tofor ~~curtail~~a ormore ~~cease~~complete description ~~operations.~~under ~~Even~~Investment ifAgreement ~~the~~and ~~Company~~Registration ~~does~~Rights ~~raise~~Agreement). ~~sufficient~~As ~~capital~~of toMarch ~~support its operating expenses~~31, ~~acquire new license agreements or ownership interests in life science companies and generate adequate revenues~~2021, or the ~~agreements~~ ~~entered~~Company ~~into~~has ~~recently~~issued ~~are successful~~3,910,000 ~~there can be no assurances that~~ of the ~~revenues~~excluded ~~will~~4,000,000 ~~be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations~~shares. ~~These~~On ~~matters~~January ~~raise~~8, ~~substantial doubt~~2021, ~~about~~ the Company’s ~~ability~~filed ~~to continue as~~ a ~~going~~Post-Effective ~~concern~~Amendment asto ~~determined~~its byJanuary ~~management. However~~21, ~~the~~2020 ~~accompanying~~S-1 Investment ~~consolidated~~Agreement ~~financial~~and ~~statements~~Registration ~~have~~Rights ~~been~~Agreement ~~prepared~~to onterminate ~~a going concern basis, which contemplates~~ the ~~realization~~effectiveness of ~~assets and satisfaction of liabilities in~~ the ~~normal~~Registration ~~course~~Statement ofand ~~business.~~to ~~These~~remove ~~consolidated~~from ~~financial statements do not include any adjustments~~registration ~~relating~~all tosecurities ~~the~~registered ~~recovery~~but ofnot ~~the~~sold ~~recorded~~under ~~assets or~~ the ~~classification~~Registration ~~of the liabilities that might be necessary should the Company be unable to continue as a going concern~~Statement.

InNOTE an2 ~~effort~~– toSUMMARY ~~support~~OF ~~the~~SIGNIFICANT ~~Company’s~~ACCOUNTING future capital needs, on January 21, 2020, the Company entered into a $5,000,000 equity line financing agreement with Tangiers, as well as a registration right agreement related thereto. The financing is over a maximum of 36 months. Pursuant to the Registration Rights Agreement, a maximum of 76,000,000 shares of our common stock, par value $.00001 per share that we may sell to Tangiers from time to time will be registered by us on Form S-1 with the Securities and Exchange Commission under the Securities Act of 1933, as amended, for this financing. As a result of the Company’s Collaboration Agreement with Aegea, whereby seventy percent (70%) of the Net Proceeds from the sale of the initial 10,000,000 shares of stock of Tauriga using the ELOC will be transferred to and invested in Aegea for the purchase of common stock of Aegea, and twenty percent (20%) of all subsequent Net Proceeds, this arrangement will provide less capital to ongoing operations. (See earlier in this Note for a more complete description under Investment Agreement and Registration Rights Agreement).POLICIES

InCONSOLIDATED ~~March~~FINANCIAL 2020, the World Health Organization declared a global pandemic related to the virus known as COVID-19. The expected impact on domestic and global commerce have been and are anticipated to continue to be far reaching. To date there have been significant stock market declines and the movement of people and goods worldwide has become severely restricted. Management is actively monitoring the situation and is taking appropriate steps as needed to ensure minimal disruption to the Company’s operations. There is a risk the COVID-19 pandemic will disrupt the Company’s operations and the movement of goods and services, as well as its investments in personnel, expansion, marketing and sales generally.STATEMENTS

FThese consolidated financial statements include the accounts and activities of Tauriga Sciences, Inc., its wholly-15owned Canadian subsidiary, its wholly-owned subsidiary Tauriga Pharma Corp. (f/k/a Tauriga Biz Dev Corp – or “Tauriga BDC” and referenced herein as Tauriga BDC for contextual purposes only in describing the Blink contractual arrangement) and Tauriga Sciences Limited. All intercompany transactions have been eliminated in consolidation. As of March 31, 2021 and 2020, there is no activity in any of the Company’s subsidiaries other than Tauriga Pharma Corp. holding the electric car chargers.

SEGMENT INFORMATION

F-21

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

~~Consolidated~~SEGMENT ~~Financial~~INFORMATION ~~Statements~~(CONTINUED)

The consolidated financial statements include the accounts and activities of Tauriga Sciences, Inc., its wholly-owned Canadian subsidiary, its wholly-owned subsidiary Tauriga Pharma Corp. (f/k/a Tauriga Biz Dev Corp – or “Tauriga BDC” and referenced herein as Tauriga BDC for contextual purposes only in describing the Blink contractual arrangement) and Tauriga Sciences Limited. All intercompany transactions have been eliminated in consolidation. As of March 31, 2020, there is no activity in any of the Company’s subsidiaries other than Tauriga Pharma Corp. holding the electric car chargers and the leasehold interest in Tauriga Sciences Limited.

	Tauri-gum			Pharma			Adjustments, eliminations and unallocated items		Consolidated
Total revenue, net	$	285,319		$	-		$	-	$	285,319
Cost of Sales		(162,627	)		-			-		(162,627	)
Gross Profit		122,692			-			-		122,692

General and Administrative expense		2,778,282			80,675			-		2,858,957
Research and development		50,885			222,500			-		273,385
Selling and fulfillment expense		379,824			-			-		379,824
Operating Loss	$	(2,761,045	)	$	(303,175	)	$	-	$	(3,389,474	)

Total Assets	$	2,288,263		$	200,440		$	-	$	2,488,703
Total Liabilities	$	1,076,038		$	141,418		$	-	$	1,217,456

~~Segment~~REVENUE ~~Information~~RECOGNITION

The Company is planning to adopt provisions of ASC 280-10 Segment Reporting, subsequent to this report date. This standard requires that companies disclose operating segments based on the manner in which management disaggregates the Company in making internal operating decisions. The Company and its Chief Operating Decision Makers determined that the Company’s operations effective with the April 3, 2020, Collaboration Agreement with Aegea now consist of two segments, its CBD/CBD edibles business and SARS-Col 2 Test business. If the Company decides to pursue the Blink charging sales business line, this will be reported as a third segment.

Revenue Recognition

On March 29, 2018 the Company, through Tauriga BDC, entered into an independent sales representative agreement with Blink to be a non-exclusive independent sales representative. Under the agreement with Blink, the Company may solicit orders from potential customers for EV charging station placement. ~~Tauriga~~On ~~BDC~~June ~~will~~29, be2018, ~~compensated upon contracting for so long as~~ the Company~~’s acquired~~ ~~prospect~~purchased ~~remains~~four ~~under~~Blink ~~contract.~~Level ~~This~~2 ~~sales~~- ~~agreement~~40” ispedestal achargers ~~three-tier~~for ~~model~~permanent ~~based~~placement onin a ~~whether~~retail ~~Tauriga~~location ~~BDC~~or ~~contracts~~locations whereby the ~~new~~ ~~customer~~Company towill ~~purchase~~pay ~~equipment~~a ~~outright~~variable ~~from~~annual ~~Blink~~fee orbased ~~enter~~on ~~into~~7% ~~one~~ of ~~two~~total revenue~~-sharing~~ ~~agreements.~~per Incharging ~~the~~unit. ~~case Tauriga~~The ~~BDC~~remainder ~~effectuates a sale~~ of ~~Blink~~the ~~equipment~~proceeds it will ~~receive~~be asplit ~~one-time~~80/20 ~~sales~~between ~~commission~~the ~~based~~Company onand the ~~sales~~host ~~price~~location ofowner ~~the~~or ~~equipment sale~~its assignee. InThe ~~the~~host ~~case~~location ~~where~~owner will ~~Tauriga~~pay ~~BDC~~for ~~secures~~the acost ~~revenue~~of ~~sharing~~providing ~~agreement~~power ~~with~~to athese ~~customer~~unit ~~where~~as ~~Blink~~well ~~remains~~as ~~the~~installation ~~owner,~~costs. ~~Tauriga BDC~~As ~~will~~of beMarch ~~paid~~31, an2021, ~~on-going~~we ~~commission~~have ~~based~~not ~~off~~installed any of ~~gross~~these ~~charger~~machines ~~revenue~~in any locations, ~~subject~~and tono ~~which~~revenue ~~party~~has ~~paid~~been ~~for~~generated through the ~~installation~~Blink contract. The Company has decided to abandon ~~Commission~~this ~~payments~~business ~~under~~line, ~~the~~and ~~revenue~~therefore, ~~sharing~~we ~~agreement~~have ~~are~~reclassified ~~subject~~these toassets ~~minimum~~as ~~revenue~~held ~~generation~~for ~~hurdles~~sale.

OnThe ~~June~~Company ~~29,~~recognizes ~~2018,~~revenue upon the ~~Company~~satisfaction ~~purchased~~of ~~four~~the ~~Blink~~performance ~~Level~~obligation. 2The -Company ~~40”~~considers ~~pedestal~~the ~~chargers~~performance ~~for~~obligation ~~permanent~~met upon ~~placement~~shipment inof athe ~~retail~~product ~~location~~ or ~~locations~~delivery ~~whereby~~of the product. For ecommerce orders, the Company’s ~~will~~products ~~pay~~are shipped by a ~~variable~~fulfillment company ~~annual~~and ~~fee~~payment ~~based~~is onmade 7%in advance of ~~total~~shipment ~~revenue~~either ~~per~~through ~~charging~~credit ~~unit~~card or PayPal. The ~~remainder of~~Company also delivers the ~~proceeds~~product ~~will~~to beits customers ~~split~~that ~~80/20~~they ~~between~~market to in the metropolitan New York Tri-State area that are not covered under any existing distribution agreements. The Company ~~and~~generally ~~the~~collects ~~host~~payment ~~location~~within ~~owner~~30 orto 60 days of completion of its ~~assignee~~performance obligation, and the Company has no agency relationships. The ~~host~~Company ~~location~~recognized ~~owner~~net ~~will~~revenue from operations in the amount of $285,319 during the year ended March 31, 2021 compared ~~pay~~to $234,389 for the ~~cost~~prior year. All revenue is from the sale of ~~providing~~the ~~power~~Company’s toTauri-GumTM product line and there were accounts receivable, net of allowance for doubtful accounts in the amount of $7,015 outstanding for these ~~unit~~sales, as ~~well~~of asMarch ~~installation~~31, ~~costs~~2021.

~~As of March 31, 2020, the Tauriga BDC has not installed any of these machines in any locations, and no revenue has been generated through the Blink contract.~~F-22

F-16

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

~~Revenue~~ALLOWANCE ~~Recognition~~FOR ~~(Continued)~~DOUBTFUL ACCOUNTS

The Company ~~recognizes~~maintains ~~revenue~~an ~~upon~~allowance ~~the~~for ~~satisfaction~~doubtful ofaccounts, ~~the~~which ~~performance~~includes ~~obligation.~~sales ~~The~~returns, ~~Company~~sales ~~considers~~allowances ~~the~~and ~~performance~~bad ~~obligation~~debts. The allowance adjusts ~~met~~the ~~upon~~carrying ~~shipment~~value of ~~the~~trade ~~product~~receivables orfor ~~delivery~~the estimate of ~~the~~accounts ~~product.~~that ~~For~~will ~~ecommerce~~ultimately ~~orders,~~not ~~the~~be ~~Company’s~~collected. ~~products~~An ~~are~~allowance ~~shipped~~for bydoubtful aaccounts ~~fulfillment~~is ~~company~~generally ~~and~~established ~~payment~~as istrade ~~made~~receivables inage ~~advance~~beyond oftheir ~~shipment~~due ~~either~~dates, ~~through~~whether ~~credit~~as ~~card~~bad debts or ~~PayPal.~~as ~~The~~sales ~~Company~~returns ~~also~~and ~~delivers~~allowances. ~~the~~As ~~product~~past todue ~~its~~balances ~~customers~~age, ~~that~~higher ~~they~~valuation ~~market~~allowances toare inestablished, thereby lowering the ~~metropolitan~~net ~~New~~carrying ~~York~~value ~~Tri~~of receivables. The amount of valuation allowance established for each past-~~State~~due ~~area~~period ~~that~~reflects ~~are~~the ~~not~~Company’s ~~covered~~historical ~~under~~collections ~~any~~experience, ~~existing~~including ~~distribution~~that ~~agreements~~related to sales returns and allowances, as well as current economic conditions and trends. The Company ~~generally~~also ~~collects~~qualitatively ~~payment~~establishes valuation ~~within~~allowances 30for tospecific 60problem ~~days~~accounts ofand ~~completion~~bankruptcies, ofand ~~its~~other ~~performance~~accounts ~~obligation, and~~that the Company ~~has~~deems norelevant ~~agency~~for ~~relationships~~specifically identified allowances. The ~~Company~~amounts ~~recognized~~ultimately ~~revenue~~collected ~~from~~on ~~operations~~past-due intrade ~~the~~receivables ~~amount~~are ofsubject ~~$234,389~~to ~~during~~numerous ~~the year~~factors ~~ended~~including ~~March~~general economic 31conditions, ~~2020~~the ~~compared~~financial tocondition noof ~~revenue~~individual ~~for~~customers and the ~~same~~terms ~~period~~of inreorganization ~~the~~for ~~prior~~accounts ~~year~~exiting bankruptcy. Changes ~~All~~in ~~revenue~~these isconditions ~~from~~impact the ~~sale of the~~ Company’s ~~Tauri-GumTM~~ ~~product~~collection ~~line~~experience and ~~there~~may ~~were~~result ~~accounts~~in ~~receivable,~~the ~~net~~recognition of ~~allowance~~higher ~~for~~or ~~doubtful~~lower ~~accounts~~valuation allowances. inAt ~~the~~March ~~amount~~31, ~~of $42~~2021,~~580~~ ~~outstanding~~the Company has established an allowance for ~~these~~doubtful ~~sales,~~accounts asin ofthe ~~March~~amount ~~31,~~of ~~2020~~$93,550.

~~The~~SALES ~~Company recognized no revenue from discontinued operations during the year ended March 31, 2020 which was related to the sales of the HERMAN® lip balm product.~~REFUNDS

~~Allowance~~The Company’s refund policy allows customers to return product for ~~Doubtful~~any ~~Accounts~~reason except where the customer does not like the taste of the product. The customer has 30 days from the date of purchase to initiate the process. Returns are limited to one return or exchange per customer. Only purchases up to $100 qualify for a refund. Approved return/refund requests are typically processed within 1-2 business days. For product purchases made through a Tauri-GumTM distributor or retailer, the customer is required to work with original purchase location for any return or exchange. The Company has not established a reserve for returns as of March 31, 2021 however will monitor the refunds to estimate whether a reserve will be required.

~~The~~USE ~~Company~~OF maintains an allowance for doubtful accounts, which includes sales returns, sales allowances and bad debts. The allowance adjusts the carrying value of trade receivables for the estimate of accounts that will ultimately not be collected. An allowance for doubtful accounts is generally established as trade receivables age beyond their due dates, whether as bad debts or as sales returns and allowances. As past due balances age, higher valuation allowances are established, thereby lowering the net carrying value of receivables. The amount of valuation allowance established for each past-due period reflects the Company’s historical collections experience, including that related to sales returns and allowances, as well as current economic conditions and trends. The Company also qualitatively establishes valuation allowances for specific problem accounts and bankruptcies, and other accounts that the Company deems relevant for specifically identified allowances. The amounts ultimately collected on past-due trade receivables are subject to numerous factors including general economic conditions, the financial condition of individual customers and the terms of reorganization for accounts exiting bankruptcy. Changes in these conditions impact the Company’s collection experience and may result in the recognition of higher or lower valuation allowances. At March 31, 2020, the Company has established an allowance for doubtful accounts in the amount of $64,146.ESTIMATES

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

~~The~~CASH Company’s refund policy allows customers to return product for any reason except where the customer does not like the taste of the product. The customer has 30 days from the date of purchase to initiate the process. Returns are limited to one return or exchange per customer. Only purchases up to $100 qualify for a refund. Approved return/refund requests are typically processed within 1-2 business days. For product purchases made through a Tauri-GumTM distributor or retailer, the customer is required to work with original purchase location for any return or exchange. The Company has not established a reserve for returns as of March 31, 2020 however will monitor the refunds to estimate whether a reserve will be required.EQUIVALENTS

~~Use~~For purposes of ~~Estimates~~reporting cash flows, cash equivalents include investment instruments purchased with an original maturity of three months or less. At March 31, 2021, the Company’s cash on deposit with financial institutions did not exceed the total FDIC insurance limit of $250,000. At March 31, 2021 and March 31, 2020, the Company had a cash balance of $49,286 and $5,348, respectively. The Company’s does not expect, in the near term, for its cash balance to exceed the total FDIC insurance limit of $250,000 for other than very short periods of time where the Company would use such cash in excess of insurance in the very short-term in operating activities. To reduce its risk associated with the failure of such financial institution, the Company holds its cash deposits in more than one financial institution and evaluates at least annually the rating of the financial institution in which it holds its deposits. The Company had no cash equivalents as of March 31, 2021 and March 31, 2020.

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

~~F-17~~Investment in trading securities consist of investments in shares of common stock of companies traded on public markets as well as publicly traded warrants of these companies should there be a market for them. These securities are carried on the Company’s balance sheet at fair value based on the closing price of the shares owned on the last trading day before the balance sheet date of this report. Fluctuations in the underlying bid price of the stocks result in unrealized gains or losses. The Company recognizes these fluctuations in value as other income or loss. For investments sold, the Company recognizes the gains and losses attributable to these investments as realized gains or losses in other income or loss.

INVESTMENT – COST METHOD

Investment in other companies that are not currently trading, are valued based on the cost method as the Company holds less than 20% ownership in these companies and has no influence over operational and financial decisions of the companies. The Company will evaluate, at least annually, whether impairment of these investments is necessary under ASC 320. As of March 31, 2021, the Company has recorded a loss on the impairment on two of its cost method investments in the amount of $244,706. The Company did not record a loss on the impairment on investments for the year ended March 31, 2020.

F-23

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

~~Cash Equivalents~~INVENTORY

~~For~~Inventory ~~purposes~~consists of ~~reporting~~finished ~~cash~~goods ~~flows,~~in ~~cash~~salable ~~equivalents~~condition ~~include~~stated ~~investment~~at ~~instruments~~the ~~purchased~~lower ~~with an original maturity~~ of ~~three months~~cost or ~~less.~~market Atdetermined ~~March~~by ~~31,~~the ~~2020~~first-in, ~~the~~first-out ~~Company’s~~method. ~~cash on deposit with financial institutions did not exceed the total FDIC~~The ~~insurance~~inventory ~~limit~~consists of ~~$250,000.~~packaged ~~At March 31, 2020~~ and ~~2019,~~labeled ~~the~~salable ~~Company~~inventory. ~~had~~Shipping ~~a cash balance~~ of ~~$5,348~~product ~~and~~to ~~$385,943,~~finished ~~respectively. The~~good ~~Company’s~~inventory ~~does~~fulfilment ~~not~~center ~~expect,~~is also included in the ~~near term, for its cash balance to exceed the~~ total ~~FDIC~~inventory ~~insurance~~cost. ~~limit~~Shipping of ~~$250,000 for~~product ~~other~~upon ~~than~~sale ~~very~~for ~~short~~e-commerce ~~periods~~sales ofis ~~time~~paid ~~where~~by the ~~Company~~customer ~~would~~upon ~~use~~ordering ~~such~~for ~~cash~~orders of insingle ~~excess~~packs of ~~insurance~~Tauri-GumTM. inFor ~~the~~multiple ~~very~~pack ~~short-term in~~or ~~operating~~wholesale ~~activities.~~product Toorders ~~reduce~~shipping ~~its~~cost ~~risk~~is ~~associated~~paid ~~with~~by the ~~failure~~Company. As of March ~~such~~31, ~~financial institution~~2021, the Company’s ~~holds~~inventory ~~its~~on ~~cash deposits~~hand inhad ~~more~~a ~~than~~value ~~one~~of ~~financial~~$201,372. ~~institution~~The ~~and~~Company ~~evaluates~~has atnot ~~least~~established ~~annually~~any inventory reserve on the ~~rating~~Tauri-GumTM as of ~~the~~March ~~financial~~31, ~~institution~~2021. inAs ~~which it~~of ~~holds~~March ~~its~~31, ~~deposits.~~2021, ~~The~~the Company had no$423,200 ~~cash~~in ~~equivalents~~funds aspaid offor ~~March~~inventory ~~31, 2020 and 2019~~not received.

~~Investment~~SHIPPING inAND ~~Trading~~HANDLING ~~Securities~~COSTS

~~Investment~~The inCompany’s ~~trading~~fulfillment ~~securities~~handling ~~consist~~costs ofare ~~investments~~provided inby ~~shares~~independent ofcontractors ~~common~~through ~~stock~~fixed offee ~~companies~~arrangements ~~traded~~which onmay ~~public~~also ~~markets as well as publicly~~include ~~traded~~incentives. ~~warrants~~These offees ~~these~~also ~~companies~~contain ~~should~~a ~~there~~large bedegree aof ~~market~~consultative, ~~for~~administrative ~~them.~~and ~~These~~warehousing ~~securities~~services ~~are~~as ~~carried~~part onof the ~~Company’s~~fixed ~~balance~~fee. ~~sheet~~Management atbelieves ~~fair~~that ~~value~~due ~~based~~to onthese ~~the~~factors ~~closing~~it ~~price~~is ofmore ~~the~~representative ~~shares~~to ~~owned~~include onthese ~~the~~amounts ~~last~~as ~~trading~~general ~~day~~and ~~before~~administrative ~~the~~costs instead ~~balance~~of ~~sheet~~cost ~~date~~ of ~~this report~~goods sold. ~~Fluctuations~~For in the ~~underlying~~year ~~bid~~ended ~~price~~March of31, 2021, the ~~stocks~~Company ~~result~~incurred infulfillment ~~unrealized~~costs ~~gains~~in orthe ~~losses.~~amount ~~The~~of ~~Company~~$106,519 ~~recognizes these~~and ~~fluctuations~~$42,050, ~~in value as other income or loss~~respectively.

~~For~~Shipping ~~investments~~cost ~~sold,~~for the Company ~~recognizes~~consists ~~the~~of ~~gains~~product movement to and ~~losses~~from ~~attributable~~trade shows, between office locations, mailing of samples and product shipments. The cost of shipping is typically not charged to ~~these~~the ~~investments~~customer aswhen ~~realized~~they ~~gains~~order ormore ~~losses~~than inone product from on the website. Customer shipping ~~other~~of ~~income~~large orcustomers ~~loss~~wholesale orders are done on a reimbursement basis therefore any shipping revenue and shipping expense are largely recorded as offsetting gross revenues and cost of goods sold. The Company had net shipping expense:

Investment – Cost Method

	Year Ended March 31,
	2021			2020
Shipping revenue	$	6,240		$	24,438
Shipping expense		(24,693	)		(31,114	)
Net shipping expense	$	(18,453	)	$	(6,706	)

~~Investment~~PROPERTY inAND other companies that are not currently trading, are valued based on the cost method as the Company holds less than 20% ownership in these companies and has no influence over operational and financial decisions of the companies. The Company will evaluate, at least annually, whether impairment of these investments is necessary under ASC 320. As of March 31, 2020, the Company has not impaired any of their cost method investments.EQUIPMENT

Inventory

Inventory consists of finished goods in salable condition stated at the lower of cost or market determined by the first-in, first-out method. The inventory consists of packaged and labeled salable inventory. Shipping of product to finished good inventory fulfillment center is also included in the total inventory cost. Shipping of product upon sale for e-commerce sales is paid by the customer upon ordering for orders of single packs of Tauri-GumTM. For multiple pack or wholesale product orders shipping cost is paid by the Company. As of March 31, 2020, the Company’s inventory on hand had a value of $128,711. The Company also has paid deposits in the amount of $96,688 to the manufacturer, Per Os Bio, towards orders not received as of March 31, 2020. Amounts paid to Per Os Bio for Tauri-GumTM are classified as deposits (other current asset) on the Company’s consolidated balance sheet until the goods are available for sale. The Company has not established any inventory reserve on the Tauri-GumTM as of March 31, 2020.

Property and Equipment

Property and equipment are stated at cost and is depreciated using the straight-line method over the estimated useful lives of the respective assets. Routine maintenance, repairs and replacement costs are expensed as incurred and improvements that extend the useful life of the assets are capitalized. When property and equipment is sold or otherwise disposed of, the cost and related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is recognized in operations.

~~Intangible~~INTANGIBLE ~~Assets~~ASSETS

Intangible assets consisted of licensing fees and a patent prior to being impaired which were stated at cost. Licenses were amortized over the life of the agreement and patents were amortized over the remaining life of the patent at the date of acquisition.

~~F-18~~NET LOSS PER COMMON SHARE

The Company computes per share amounts in accordance with FASB ASC Topic 260 “Earnings per Share” (“EPS”), which requires presentation of basic and diluted EPS. Basic EPS is computed by dividing the income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS is based on the weighted-average number of shares of common stock and common stock equivalents outstanding during the periods; however, potential common shares are excluded for period in which the Company incurs losses, as their effect is anti-dilutive. For the years ended March 31, 2021 and 2020, basic and fully diluted earnings per share were the same as the Company had losses in this period.

STOCK-BASED COMPENSATION

F-24

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

~~Net~~STOCK-BASED ~~Loss~~COMPENSATION ~~Per Common Share~~(CONTINUED)

The Company computes per share amounts in accordance with FASB ASC Topic 260 “Earnings per Share” (“EPS”), which requires presentation of basic and diluted EPS. Basic EPS is computed by dividing the income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS is based on the weighted-average number of shares of common stock and common stock equivalents outstanding during the periods; however, potential common shares are excluded for period in which the Company incurs losses, as their effect is anti-dilutive. For the years ended March 31, 2020 and 2019, basic and fully diluted earnings per share were the same as the Company had losses in this period.

Stock-Based Compensation

The Company accounts for Stock-Based Compensation under ASC 718 “Compensation-Stock Compensation,” which addresses the accounting for transactions in which an entity exchanges its equity instruments for goods or services, with a primary focus on transactions in which an entity obtains employee services in share-based payment transactions. ASC 718-10 requires measurement of cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). Incremental compensation costs arising from subsequent modifications of awards after the grant date must be recognized.

~~Reclassifications~~IMPAIRMENT OF LONG-LIVED ASSETS

Certain prior year amounts have been reclassified to conform to the current period presentation. The reclassifications had no effect on the net loss or cash flows of the Company.

Impairment of Long-Lived Assets

Long-lived assets, primarily fixed assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets might not be recoverable. The Company will perform a periodic assessment of assets for impairment in the absence of such information or indicators. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner in which an asset is used, or a significant adverse change that would indicate that the carrying amount of an asset or group of assets is not recoverable. For long-lived assets to be held and used, the Company would recognize an impairment loss only if it’s carrying amount is not recoverable through its undiscounted cash flows and measures the impairment loss based on the difference between the carrying amount and estimated fair value.

~~Research~~RESEARCH ~~and~~AND ~~Development~~DEVELOPMENT

The Company expenses research and development costs as incurred. Research and development costs were $6273,~~923~~385 and $136,~~924~~923 for the years ~~ended~~ ended March 31, ~~2020~~2021 and ~~2019~~2020, respectively. The Company is continually evaluating products and technologies, and incurs expenses relative to these evaluations, including in the natural wellness space, ~~including~~such ~~its~~as Tauri-~~GumTM~~Gum™ product ~~including~~development of new flavor formulations and other CBD delivery products, as well as development of a Cannabigerol (“CBG”) Isolate Infused version of its Tauri-Gum™ brand. inWe ~~addition~~also incur expenses relative to collaboration agreements and any activity relative to the progress in the development of the ~~intellectual~~Company’s FDA IND application for Phase II Trial of its proposed pharmaceutical grade version of Tauri-Gum™, as well as intellectual property or other related technologies. As the Company investigates and develops relationships in these areas, resultant expenses for trademark filings, license agreements, website and product development and design materials will be expensed as research and development. Some costs will be accumulated for subsidiaries prior to formation of any new entities.

~~F-19~~FAIR VALUE MEASUREMENTS

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2020 AND 2019

(US$)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Fair Value Measurements

ASC 820 “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements.

Level 1- fair value measurements are those derived from quoted prices (unadjusted in active markets for identical assets or liabilities);

Level 3- fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Financial instruments classified as Level 1 – quoted prices in active markets include cash.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management for the respective periods. The respective carrying value of certain financial instruments approximated their fair values due to the shortF-~~term nature of these instruments. These financial instruments include cash, investments, short-term notes payable, accounts payable and accrued expenses.~~25

Share settled debt

F-20

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

~~Share~~FAIR ~~settled~~VALUE ~~debt~~MEASUREMENTS (~~Continued~~CONTINUED)

RECLASSIFICATIONS

Certain prior year amounts have been reclassified to conform to the current period presentation. The reclassifications had no effect on the net loss or cash flows of the Company.

SHARE SETTLED DEBT

The Company has multiple notes that contain discount provisions whereby the holder can exercise conversion rights at a discount to the market price for a 15 or 20 day trailing period based on the market volume average weighted price. ASC 470-20 defines this as a beneficial conversion feature which that shall be recognized separately at issuance by allocating a portion of the proceeds equal to the intrinsic value, not to exceed the face value of the note, to additional paid in capital. This segmented value, is to be amortized using the effective interest method over the term of the note.

~~Income~~INCOME ~~Taxes~~TAXES

Income taxes are accounted for under the liability method of accounting for income taxes. Under the liability method, future tax liabilities and assets are recognized for the estimated future tax consequences attributable to differences between the amounts reported in the financial statement carrying amounts of assets and liabilities and their respective tax bases.

Future tax assets and liabilities are measured using enacted or substantially enacted income tax rates expected to apply when the asset is realized, or the liability settled. The effect of a change in income tax rates on future income tax liabilities and assets is recognized in income in the period that the change occurs. Future income tax assets are recognized to the extent that they are considered more likely than not to be realized.

ASC 740 “Income Taxes” clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. This standard requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements.

As a result of the implementation of this standard, the Company performed a review of its material tax positions in accordance with ~~recognition~~ recognition and measurement standards established by ASC 740 and concluded that the tax position of the Company does not meet the more-likely-than-not threshold as of March 31, ~~2020~~2021.

~~Recent Accounting Pronouncements~~F-26

In June 2018, the FASB issued ASU No. 2018-07, “Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting” which addresses accounting for issuance of all share-based payments on the same accounting model. Previously, accounting for share-based payments to employees was covered by ASC Topic 718 while accounting for such payments to non-employees was covered by ASC Subtopic 505-50. As it considered recently issued updates to ASC 718, the FASB, as part of its simplification initiatives, decided to replace ASC Subtopic 505-50 with Topic 718 as the guidance for non-employee share based awards. Under this new guidance, both sets of awards, for employees and non-employees, will essentially follow the same model, with small variations related to determining the term assumption when valuing a non-employee award as well as a different expense attribution model for non-employee awards as opposed to employee awards. The ASU is effective for public business entities beginning in 2019 calendar years and one year later for non-public business entities. The Company has determined that there is not a material impact on their consolidated financial position and results of operations as a result of this standard.

In February 2016, FASB issued ASU 2016-02, “Leases (Topic 842).” The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases.

F-21

TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, ~~2020~~2021 AND ~~2019~~2020

(US$)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

~~Recent~~RECENT ~~Accounting~~ACCOUNTING ~~Pronouncements (Continued)~~PRONOUNCEMENTS

In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40), Accounting for Convertible Instruments and Contract’s in an Entity’s Own Equity. The ASU simplifies accounting ~~new~~for ~~guidance~~convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it. The ASU simplifies the diluted net income per share calculation in certain areas. The ASU is effective for annual ~~reporting~~and interim periods beginning after December 1531, ~~2018~~2021, ~~including~~and ~~interim~~early ~~periods~~adoption ~~within~~is ~~that~~permitted for fiscal years beginning after December ~~reporting~~15, ~~period~~2020, and isinterim ~~applied~~periods ~~retrospectively.~~within ~~Early~~those ~~adoption~~fiscal ~~is permitted~~years. The Company ~~has~~is ~~adopted~~currently evaluating the impact that this ~~standard~~new asguidance ofwill ~~April~~have 1,on ~~2019~~its ~~(See~~consolidated ~~Note~~financial 7)statements.

In June 2018, the FASB issued ASU No. 2018-07, “Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting” which addresses accounting for issuance of all share-based payments on the same accounting model. Previously, accounting for share-based payments to employees was covered by ASC Topic 718 while accounting for such payments to non-employees was covered by ASC Subtopic 505-50. As it considered recently issued updates to ASC 718, the FASB, as part of its simplification initiatives, decided to replace ASC Subtopic 505-50 with Topic 718 as the guidance for non-employee share based awards. Under this new guidance, both sets of awards, for employees and non-employees, will essentially follow the same model, with small variations related to determining the term assumption when valuing a non-employee award as well as a different expense attribution model for non-employee awards as opposed to employee awards. The ASU is effective for public business entities beginning in 2019 calendar years and one year later for non-public business entities. The Company has determined that there is not a material impact on their consolidated financial position and results of operations as a result of this standard.

In February 2016, FASB issued ASU 2016-02, “Leases (Topic 842).” The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period and is applied retrospectively. The Company has adopted this standard as of April 1, 2019 (See Note 7).

~~Subsequent~~SUBSEQUENT ~~Events~~EVENTS

In accordance with ASC 855 “Subsequent Events” the Company evaluated subsequent events after the balance sheet date through the date of issuance of this report.

NOTE 3: REVENUE

The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers, which the Company adopted simultaneous with the commencement of sales in March 2019. No cumulative adjustment to accumulated deficit was done, and the adoption did not have an impact on our consolidated financial statements, as no material arrangements prior to the adoption were impacted by the new pronouncement.

The following table disaggregates the Company’s revenue by major source for the years ended March 31:

	2020		2019
Revenue:
Distributor	$	62,441	$	1,000
E-Commerce		34,439		794
Wholesale		137,509		2,340
	$	234,389	$	57,134

Revenues in the year ended March 31, 2020 from largely from the wholesale channel. As of March 31, 2020, the Company established an allowance for doubtful account collectability in the amount of $64,146 that was wholly attributable to the Wholesale channel. There were no significant contract asset or contract liability balances for all periods presented. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.

Collections of the amounts billed are typically paid by the customers within 30 to 60 days.

NOTE 4– INVENTORY

Inventory from continuing operations

Inventory value by product as of:

	March 31, 2020		March 31, 2019
Tauri-GumTM	$	120,481	$	10,872
Tauri-GummiesTM		4,029		-
Collagen/Omega-3 Gummies (1)		2,425		-
Other (2)		1,776		-
Total Inventory	$	128,710	$	10,872

(1) This segment of inventory is stock that was purchased in conjunction with Resale Agreement with OG Laboratories, LLC

(2) Other inventory consists of holiday pouches sold as a bundled of Tauri-GumTM

As of March 31, 2020, the Company did not have an CBG Tauri-GumTM in stock.

At March 31, 2020, deposits to Per Os Bio in the amount of $96,688 for the manufacturing costs of Tauri-GumTM have been classified as a deposit (prepaid expenses other current assets) on the Company’s consolidated balance sheet, as the goods are not yet available for sale.

At March 31, 2019, the Company had deposits to Per Os Bio in the amount of $105,000 for the manufacturing costs of Tauri-GumTM for goods not yet available for sale.

NOTE 5– DISCONTINUED OPERATIONS

On March 31, 2019, the Company decided to discontinue operations relative to its HERMAN© Lip balm product line. After much effort the Company was unable to resolve manufacturing issues as it related to it its lip balm tube mechanism. The Company did not believe that these issues will be resolvable without a substantial investment of time and money. Therefore, the Company exchanged its 50% ownership in Ice+Jam, LLC for the balance of the non-controlling interest as of March 31, 2019. On April 1, 2019, the Company recognized a gain on the disposal of discontinued operations in the amount of $4,941.

The Company had no revenue or expenses from discontinued operations during the year ended March 31, 2020.

TAURIGA SCIENCES, INC. AND SUBSIDIARY

BALANCE SHEETS FROM DISCONTINUED OPERATIONS

	March 31, 2020		March 31, 2019
Assets from discontinued operations	$	-	$	581
Liabilities from discontinued operations	$	-	$	5,522

NOTE 6– PROPERTY AND EQUIPMENT

The Company’s property and equipment is as follows:

	March 31, 2020			March 31, 2019			Estimated Life
Computers, office furniture and other equipment	$	69,638		$	69,808		3-5 years
Less: accumulated depreciation		(56,160	)		(56,798	)
Net	$	13,478			13,010

On June 29, 2018, the Company purchased four Blink Level 2 – 40” pedestal chargers for permanent placement in one or more retail locations whereby the Company will share revenue from these electric car vehicle charging units with such location owner. No depreciation expense has been recorded for the charging units as of March 31, 2020 due to the fact that they have not been placed in service.

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TAURIGA SCIENCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED MARCH 31, 2020 AND 2019

(US$)

NOTE 6– PROPERTY AND EQUIPMENT (CONTINUED)

Depreciation expense for the years ended March 31, 2020 and 2019 was $913 and $964. During the year ended March 31, 2020, the Company disposed of computer equipment valued at $2,782 recognizing a loss on disposal of $1,230.

During the year ended March 31, 2019 the Company disposed of computer equipment valued at $1,632 recognizing a loss on disposal of $907.

NOTE 7 – OPERATING LEASE

The Company has adopted ASU No. 2016-02, Leases (Topic 842), as of April 1, 2019 and will account for the new lease in terms of the right of use assets and offsetting lease liability obligations for this new lease under this pronouncement. In accordance with ASC 842 - Leases, effective April 1, 2019, the Company recorded a net lease right of use asset and a lease liability at present value of approximately $7,492 and $7,895, respectively. The Company recorded these amounts at present value, in accordance with the standard, using a discount rate of 8% which is representative of the last borrowing rates for notes issued to non-related parties. The right of use asset is composed of the sum of all lease payments, at present value, and is amortized straight line over the life of the expected lease term. For the expected term of the lease the Company used the initial term of the two-year lease. Upon the election by the Company to extend the lease for additional years, that election

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