U.S. SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒	☒Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act of 1934	~~Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act of 1934~~
		For the quarterly period ended December 31, 2019
	For the quarterly period ended June 30, 2020
☐	☐Transition Report under Section 13 or 15(d) of the Exchange Act	~~Transition Report under Section 13 or 15(d) of the Exchange Act~~
	For the Transition Period from ________to __________	~~For the Transition Period from ________to __________~~

Commission File Number: 333-197642

Tribus Enterprises, Inc.

(Exact Name of Registrant as Specified in its Charter)

Washington	82-1104757
(State of other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)

155 Haas Drive
Englewood, OH	45322
(Address of principal executive offices)	(Zip Code)

Registrant'’s Phone: (509) 992-4743

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

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

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section13 or 15(d) of the Exchange Act of 1934 during the past 12 months (or such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No ☒

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

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

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

AsThe number of ~~February~~shares ~~14,~~of ~~2020~~Common Stock, ~~the~~$0.001 ~~issuer~~par ~~had 7~~value,~~320,858~~ ~~shares~~outstanding on ofAugust ~~common~~19, ~~stock~~2020 ~~issued~~was ~~and~~13,545,658 ~~outstanding~~shares.

	TABLE OF CONTENTS	Page
PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operation	1110
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	1312
Item 4.	Controls and Procedures	1312
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	1312
Item 1A.	Risk Factors	1513
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	1513
Item 3.	Defaults Upon Senior Securities	1513
Item3A.	Off Balance Sheet Arrangements	1513
Item 4.	Submission of Matters to a Vote of Security Holders	1513
Item 5.	Other Information	1514
Item 6.	Exhibits	1514

ITEM 1. FINANCIAL STATEMENTS

TRIBUS ENTERPRISES, INC.

UNADUITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~December 31~~June 30, ~~2019~~2020

Condensed Consolidated Balance Sheets	1
Unaudited Condensed Consolidated Balance Sheets	1
Unaudited Condensed Consolidated Statements of Operations	2
Unaudited Condensed Consolidated Statement of Changes in Stockholders’ Equity	3
Unaudited Condensed Consolidated Statements of Cash Flows	4
Notes to Unaudited Condensed Consolidated Financial Statements	5 - 109

TRIBUS ENTERPRISES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS

TRIBUS ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

	June 30, 2020			March 31, 2020
	(unaudited)			(audited)
ASSETS
Current assets
Cash	$	909,842		$	150,741
Inventory, net of inventory valuation of $43,723 and $0, respectively (Note 6)		31,775			9,590
Deposits, current		-			-
Prepaid expenses		36,384			15,511
Total current assets		978,001			175,842

Deposits		37,835			41,337
Right of use asset, operating leases		142,824			157,117
Equipment, net of accumulated depreciation of $389,638 and $552,435, respectively		1,005,654			1,265,559

Total assets	$	2,164,314		$	1,639,855

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	204,120		$	415,070
Interest payable		24,002			61,938
Accrued rent		-			-
Deferred revenue (Note 5)		1,247			3,814
Operating lease liability, current (Note 8)		70,813			66,206
Finance lease, current (Note 10)		86,989			340,303
Loans payable, current (Note 9)		117,824			339,969
Total current liabilities		504,995			1,227,300

Operating lease liability, net of current portion (Note 8)		71,165			90,730
Finance lease, net of current portion (Note 10)		99,906			382,254
Loans payable, net of current portion (Note 9)		23,726			26,027
Other Long-Term Liabilities		3,200			-

Total liabilities		702,992			1,726,311

Commitments and contingencies		-			-

Stockholders’ equity
Series A convertible preferred stock, $0.001 par; 20,000,000 authorized; 19,999,998 issued and outstanding at June 30, 2020 and March 31, 2020, respectively (Note 7)		20,000			20,000
Series B convertible preferred stock, $0.001 par; 5,000,000 authorized; 4,649,800 and 3,910,000 issued and outstanding at June 30, 2020 and March 31, 2020, respectively (Note 7)		4,650			3,910
Common stock, $0.001 par value; 100,000,000 authorized; 13,545,658 and 7,360,858 issued and outstanding at June 30, 2020 and March 31, 2020, respectively (Note 7)		13,546			7,361
Additional paid in capital		5,457,888			3,600,752
Accumulated deficit		(4,034,762	)		(3,718,479	)
Total stockholders’ equity		1,461,322			(86,456	)

Total liabilities and stockholders’ equity	$	2,164,314		$	1,639,855

	December 31, 2019			March 31, 2019
	(unaudited)			(audited)
ASSETS
Current assets
Cash	$	423,674		$	33,970
Inventory		78,282			-
Deposits, current		402,000			402,000
Prepaid expenses		5,511			20,011
Total current assets		909,467			455,981
Deposits		41,337			41,337
Right of use asset		170,526			-
Equipment, net of accumulated depreciation of $460,039 and $194,226, respectively		1,326,580			1,061,675
Total assets	$	2,447,910		$	1,558,993
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	129,274		$	108,249
Interest payable		50,417			23,612
Accrued rent		-			8,027
Deferred revenue		3,814			814
Operating lease liability, current		61,886			-
Capital lease, current (Note 7)		301,162			214,529
Loans payable, current (Note 6)		349,670			82,449
Total current liabilities		896,223			437,680
Operating lease liability, net of current portion		108,880			-
Capital lease, net of current portion (Note 7)		456,981			667,053
Loans payable, net of current portion (Note 6)		27,257			14,057
Total liabilities		1,489,341			1,118,790
Commitments and contingencies		-			-
Stockholders' equity
Series A convertible preferred stock, $0.001 par; 20,000,000 authorized; 19,999,998 issued and outstanding at December 31, 2019 and March 31, 2019, respectively		20,000			20,000
Series B convertible preferred stock, $0.001 par; 5,000,000 authorized; 3,910,000 and 1,365,625 issued and outstanding at December 31, 2019 and March 31, 2019, respectively		3,910			1,366
Common stock, $0.001 par value; 100,000,000 authorized; 7,320,858 and 7,184,858 issued and outstanding at December 31, 2019 and March 31, 2019, respectively		7,321			7,185
Additional paid in capital		3,590,792			1,818,694
Accumulated deficit		(2,663,454	)		(1,407,042	)
Total stockholders' equity		958,569			440,203
Total liabilities and stockholders' equity	$	2,447,910		$	1,558,993

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

TRIBUS ENTERPRISES, INC. CONSOLDIATED STATEMENTS OF OPERATIONS

TRIBUS ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	Three months ended June 30,
	2020			2019
Revenue	$	7,454		$	-
Cost of goods sold		77,568			-
Gross margin		(70,114	)		-

Operating expenses
Employee costs		46,527			58,445
Professional fees		10,998			60,020
General and administrative		36,485			88,574
Facilities		24,678			19,018
Research and development		12,781			9,765
Depreciation expense		79,987			65,728
Total operating expenses		211,456			301,550

Net loss from operations		(281,570	)		(301,550	)

Other income (expense)
Other income		149,956			9,328
Other expense		(3,513	)		-
Loss on sale of equipment		(145,127	)		(1,752	)
Interest expense		(36,029	)		(61,424	)
Total other income (expense)		(34,713	)		(53,848	)

Income tax		-			-
Net and comprehensive loss	$	(316,283	)	$	(355,398	)

Net loss per share, basic and diluted	$	(0.03	)	$	(0.05	)

Weighted average shares outstanding, basic and diluted		11,637,465			7,185,298

	Three months ended December 31,						Nine months ended December 31,
	2019			2018			2019			2018
Revenue	$	25,554		$	-		$	25,554		$	-
Cost of goods sold		67,868			-			67,868			-
Gross margin		(42,314	)		-			(42,314	)		-
Operating expenses
Employee costs		20,047			60,729			110,928			182,688
Professional fees		169,777			27,012			287,885			74,115
General and administrative		115,281			21,043			258,685			85,110
Facilities		19,630			12,884			64,559			62,881
Research and development		55,851			-			65,616			1,140
Depreciation expense		92,627			50,117			282,037			129,679
Total operating expenses		473,213			171,785			1,069,710			535,613
Net loss from operations		(515,527	)		(171,785	)		(1,112,024	)		(535,613	)
Other income (expense)
Other income		13,861			10,640			35,489			10,640
Loss on sale of equipment		-			-			(1,752	)		-
Interest expense		(54,592	)		(43,549	)		(178,125	)		(67,743	)
Total other income (expense)		(40,731	)		(32,909	)		(144,388	)		(57,103	)
Net and comprehensive loss	$	(556,258	)	$	(204,694	)	$	(1,256,412	)	$	(592,716	)
Net loss per share, basic and diluted	$	(0.08	)	$	(0.03	)	$	(0.17	)	$	(0.08	)
Weighted average shares outstanding, basic and diluted		7,317,206			7,146,988			7,255,462			7,065,006

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

TRIBUS ENTERPRISES, INC. CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

TRIBUS ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

	Series A Convertible Preferred Stock				Series B Preferred Stock				Common Stock				Additional Paid In Capital			Accumulated Deficit
	Shares		Amount		Shares		Amount		Shares		Amount		Additional Paid In Capital			Accumulated Deficit			Total

Balance, March 31, 2019		19,999,998		20,000		1,365,625		1,366		7,184,858		7,185		1,818,694			(1,407,042	)		440,203
Series B preferred stock issued for cash		-		-		311,875		312		-		-		249,188			-			249,500
Common stock issued for cash		-		-		-		-		4,000		4		996			-			1,000
Net loss, three months ended June 30, 2019		-		-		-		-		-		-		-			(355,398	)		(355,398	)
Balance, June 30, 2019		19,999,998	$	20,000		1,677,500	$	1,678		7,188,858	$	7,189	$	2,068,878		$	(1,762,440	)	$	335,305

Balance, March 31, 2020		19,999,998	$	20,000		3,910,000	$	3,910		7,360,858	$	7,361	$	3,600,752		$	(3,718,479	)	$	(86,456	)
Series B preferred stock issued for cash		-		-		739,800	$	740		-	$	-	$	517,120			-		$	517,860
Common stock issued for cash		-		-		-		-		6,184,800		6,185		1,540,016			-			1,546,201
Shareholder cash contribution		-		-		-		-		-		-		-			-			-
Direct Incremental Costs														(200,000	)					(200,000	)
Net loss, three months ended June 30, 2020		-		-		-		-		-		-		-			(316,283	)		(316,283	)
Balance, June 30, 2020		19,999,998	$	20,000		4,649,800	$	4,650		13,545,658	$	13,546	$	5,457,888		$	(4,034,762	)	$	1,461,322

	Series A Convertible Preferred Stock				Series B Preferred Stock				Common Stock				Additional Paid In		Accumulated
	Shares		Amount		Shares		Amount		Shares		Amount		Capital		Deficit			Total
Balance, March 31, 2018		19,999,998	$	20,000		1,007,500	$	1,008		6,903,658	$	6,904	$	1,462,533	$	(593,399	)	$	897,046
Series B preferred stock issued for cash		-		-		206,875		206		-		-		165,294		-			165,500
Common stock issued for cash		-		-		-		-		155,200		155		38,645		-			38,800
Net loss, three months ended June 30, 2018		-		-		-		-		-		-		-		(172,651	)		(172,651	)
Balance, June 30, 2018		19,999,998		20,000		1,214,375		1,214		7,058,858		7,059		1,666,472		(766,050	)		928,695
Common stock issued for cash		-		-		-		-		8,000		8		1,992		-			2,000
Net loss, three months ended September 30, 2018		-		-		-		-		-		-		-		(215,371	)		(215,371	)
Balance, September 30, 2018		19,999,998		20,000		1,214,375		1,214		7,066,858		7,067		1,668,464		(981,421	)		715,324
Series B preferred stock issued for cash		-		-		151,250		151		-		-		120,849		-			121,000
Common stock issued for cash		-		-		-		-		118,000		118		29,382		-			29,500
Net loss, three months ended December 31, 2018		-		-		-		-		-		-		-		(204,694	)		(204,694	)
Balance, December 31, 2018		19,999,998	$	20,000		1,365,625	$	1,365		7,184,858	$	7,185	$	1,818,695	$	(1,186,115	)	$	661,130
Balance, March 31, 2019		19,999,998		20,000		1,365,625		1,366		7,184,858		7,185		1,818,694		(1,407,042	)		440,203
Series B preferred stock issued for cash		-		-		311,875		312		-		-		249,188		-			249,500
Common stock issued for cash		-		-		-		-		4,000		4		996		-			1,000
Net loss, three months ended June 30, 2019		-		-		-		-		-		-		-		(355,398	)		(355,398	)
Balance, June 30, 2019		19,999,998		20,000		1,677,500		1,678		7,188,858		7,189		2,068,878		(1,762,440	)		335,305
Series B preferred stock issued for cash		-		-		375,000		375		-		-		299,625		-			300,000
Common stock issued for cash		-		-		-		-		88,000		88		21,912		-			22,000
Shareholder cash contribution		-		-		-		-		-		-		3,040		-			3,040
Shareholder forgiveness of wages payable		-		-		-		-		-		-		73,738		-			73,738
Net loss, three months ended September 30, 2019		-		-		-		-		-		-		-		(344,756	)		(344,756	)
Balance, September 30, 2019		19,999,998		20,000		2,052,500		2,053		7,276,858		7,277		2,467,193		(2,107,196	)		389,327
Series B preferred stock issued for cash		-		-		1,857,500		1,857		-		-		1,112,643		-			1,114,500
Common stock issued for cash		-		-		-		-		44,000		44		10,956		-			11,000
Net loss, three months ended December 31, 2019		-		-		-		-		-		-		-		(556,258	)		(556,258	)
Balance, December 31, 2019		19,999,998	$	20,000		3,910,000	$	3,910		7,320,858	$	7,321	$	3,590,792	$	(2,663,454	)	$	958,569

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

TRIBUS ENTERPRISES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS

TRIBUS ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Three months ended June 30,
	2020			2019
Cash flows from operating activities
Net loss	$	(316,283	)	$	(355,398	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		99,250			75,010
Loss on sale of equipment		145,127			1,751
Loan Forgiveness		(131,720	)		-
Changes in operating assets and liabilities:
Prepaid expenses		(20,873	)		20,000
Deposits		3,502			-
Accounts payable and accrued liabilities		(210,950	)		66,910
Interest payable		(37,936	)		43,438
Deferred rent		1,247			(2,448	)
Deferred revenue		(3,814	)		-
Inventory		(22,185	)		(6,907	)
Sub lease security deposit		3,200
Net cash used in operating activities		(491,435	)		(157,644	)

Cash flows from investing activities
Purchase of equipment		(193,838	)		(30,918	)
Sale of equipment		370,000			-
Net cash provided by (used in) investing activities		176,162			(30,918	)

Cash flows from financing activities
Repayments of capital leases		(403,942	)		(2,490	)
Payments on operating lease liability		(14,958	)		(9,447	)
Proceeds from loans payable		-			(35,856	)
Repayments of loans payable		(385,090	)		-
Proceeds from CARES Act Loan		14,304			-
Proceeds from sale of common stock		1,546,200			1,000
Proceeds from the sale of series B preferred stock		517,860			249,500
Payments of direct incremental costs associated with the sale of stock		(200,000	)		-
Net cash provided by financing activities		1,074,374			202,707

Cash, beginning of period		150,741			33,970
Net change in cash		759,101			14,145
Cash, end of period	$	909,842		$	48,115

Supplemental cash flow information
Cash paid for interest	$	73,965		$	22,912
Cash paid for income taxes	$	-		$	-

Supplemental disclosure of non-cash financing activities
Loan entered into for purchase of equipment	$	146,340		$	301,161
Loan entered into for purchase of vehicle	$	-		$	34,222

	Nine months ended December 31,
	2019			2018
Cash flows from operating activities
Net loss	$	(1,256,412	)	$	(592,716	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		313,291			131,571
Loss on sale of equipment		1,751			-
Changes in operating assets and liabilities:
Prepaid expenses		14,500			(448	)
Deposits		-			(412,897	)
Accounts payable and accrued liabilities		94,762			7,792
Interest payable		36,290			14,770
Deferred rent		(2,448	)		144
Deferred revenue		3,000			814
Inventory		(78,282	)		-
Net cash used in operating activities		(873,548	)		(850,970	)
Cash flows from investing activities
Purchase of equipment		(3,758	)		(58,840	)
Net cash used in investing activities		(3,758	)		(58,840	)
Cash flows from financing activities
Repayments of capital leases		(132,924	)		(277,695	)
Payments on operating lease liability		(36,593	)		-
Proceeds from loans payable		-			60,000
Repayments of loans payable		(264,513	)		(24,170	)
Shareholder cash contribution		3,040			-
Proceeds from sale of common stock		34,000			70,300
Proceeds from the sale of series B preferred stock		1,664,000			286,501
Net cash provided by financing activities		1,267,010			114,936
Cash, beginning of period		33,970			913,958
Net change in cash		389,704			(794,874	)
Cash, end of period	$	423,674		$	119,084
Supplemental cash flow information
Cash paid for interest	$	62,816		$	28,779
Cash paid for income taxes	$	-		$	-
Supplemental disclosure of non-cash financing activities
Capital leases entered into for purchase of equipment	$	-		$	1,162,240
Loan entered into for purchase of equipment	$	564,398		$	-
Forgiveness of accrued wages by related parties	$	73,738		$	-

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

TRIBUS ENTERPRISES, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

~~December~~June 3130, ~~2019~~2020

NOTE 1 – NATURE OF OPERATIONS AND ORGANIZATION

The Company was incorporated in the State of Washington on March 29, 2017 for the purpose of developing, designing, manufacturing and distributing hand tools. Upon incorporation, the Company entered into a share exchange agreement with Tribus Innovations, LLC (“Tribus Innovations”) and acquired all of the outstanding ownership interests of Tribus Innovations. Tribus Innovations was formed on December 1, 2015. The transaction was accounted for as a reverse merger and these financial statements present the historical financial information of Tribus Innovations from its inception and include the financial information of the Company from the completion of the share exchange agreement on March 29, 2017. The Company has realized minimal revenues from its planned business activities.

NOTE 2 – UNAUDITED CONDENSED CONSOLDIATED INTERIM FINANCIAL STATEMENTS

The accompanying unaudited condensed consolidated interim financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows for the periods ended ~~December~~June 3130, ~~2019~~2020 and for all periods presented herein, have been made.

Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s March 31, ~~2019~~2020 audited financial statements. The results of operations for the periods ended ~~December~~June 3130, ~~2019~~2020 are not necessarily indicative of the operating results for the full year. These consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Tribus Innovations LLC. All intercompany balances and transactions are eliminated on consolidation.

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates. Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company’s system of internal accounting control is designed to assure, among other items, that (1) recorded transactions are valid; (2) all valid transactions are recorded and (3) transactions are recorded in the period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the company for the respective periods being presented.

NOTE 3 – GOING CONCERN

The Company'’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company does not have significant cash or other current assets, nor does it have an established source of revenues sufficient to cover its operating costs which raises substantial doubt regarding the Company’s ability to continue as a going concern. Under the going concern assumption, an entity is ordinarily viewed as continuing in business for the foreseeable future with neither the intention nor the necessity of liquidation, ceasing trading, or seeking protection from creditors pursuant to laws or regulations. Accordingly, assets and liabilities are recorded on the basis that the entity will be able to realize its assets and discharge its liabilities in the normal course of business.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully execute its plans and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern. During the next year, the Company’s foreseeable cash requirements will relate to continual development of the operations of its business, maintaining its good standing and making the requisite filings with the Securities and Exchange Commission, and the payment of expenses associated with research and development. The Company may experience a cash shortfall and be required to raise additional capital. Historically, it has mostly relied upon internally generated funds and funds from the sale of shares of stock to finance its operations and growth. Management may raise additional capital through future public or private offerings of the Company’s stock or through loans from private investors, although there can be no assurance that it will be able to obtain such financing. The Company’s failure to do so could have a material and adverse effect upon it and its shareholders.

TRIBUS ENTERPRISES, INC.

Notes to Unaudited Consolidated Condensed Financial Statements

~~December~~June 3130, ~~2019~~2020

NOTE 34 – ~~GOING~~REVENUE ~~CONCERN (CONTINUED)~~RECOGNITION

NOTE 4 – CURRENT DEPOSITS

During the year ended March 31, 2019, the Company made total advances to a third-party manufacturer of $402,000 in exchange for a discount from the negotiated purchase price of future inventory units. The deposits allowed the Company to receive a discount of approximately $2.46 per unit from the originally agreed upon purchase price on the first 163,415 individual units of inventory manufactured when purchases begin.

During the nine months ended December 31, 2019, the Company entered into a legal dispute with the third-party manufacturer. Among other claims, the Company is seeking a return of the deposits made totaling $402,000. During the three months ended December 31, 2019, the third-party manufacturer’s motion to compel arbitration with the Company was denied and the attorney of record filed a motion to withdraw their representation leaving the third party manufacturer without legal representation as of December 31, 2019. While the dispute is unresolved as of the date the financial statements were issued, the Company, through discussions with outside counsel, believes the deposits totaling $402,000 are likely to be returned to the Company. As such, no reserve against the deposits has been recorded as of December 31, 2019 or March 31, 2019.

NOTE 5 – REVENUE RECOGNITION

The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, for revenue recognition. Adoption of ASC 606 did not have a significant impact on our financial statements. Revenue is recognized upon transfer of control of promised products to customers in an amount that reflects the consideration expected to be received in exchange for those products. Revenue is recognized net of allowances for returns and any taxes collected from customers, which are subsequently remitted to governmental authorities.

The Company offers a limited lifetime warranty for manufacturing defects only on product sold. Due to sales recently occurring, the Company is unable to reasonably estimate future costs that will be incurred under its lifetime warranty program on revenue recognized as of ~~December~~June 3130, ~~2019~~2020. However, the Company anticipates the amounts associated with revenues recognized as of ~~December~~June 3130, ~~2019~~2020 to be immaterial to the financial statements.

The Company recognized revenues of $257,~~554~~454 and $0 during the three ~~and nine~~ months ended ~~December~~June 3130, 2020 and 2019, respectively.

NOTE 5 - DEFERRED REVENUE

Deferred revenue represents revenues collected but not earned as of June 30, 2020. This is primarily composed of rent or sales revenue received in advance of goods or services being delivered. The balance of deferred revenue was $1,247 and $3,814 as of June 30, 2020 and March 31, 2020, respectively.

NOTE 6 - INVENTORY

The Company ~~carries inventory at cost and~~ recognizes the cost of ~~each~~ inventory through cost of goods sold as product is shipped to customers on a first in, first out basis. The value of inventory is carried at the lower of cost or market of raw materials purchased to manufacture the finished goods, direct labor associated with manufacturing and certain overhead related to the manufacturing facility. ~~The~~As of June 30, 2020, the Company’s ~~had~~finished goods inventory balance ~~balances~~was of $7854,~~282~~373. ~~and~~This balance is recorded net of inventory valuation of $043,723 ~~all~~in oforder ~~which~~to ~~was~~bring the value of finished goods inventory to the lower of cost or market. In addition, the Company had $21,125 in work in process inventory as of ~~December~~June 3130, ~~2019~~2020. The ~~and~~ March 31, ~~2019~~2020 inventory balance of $9,590 ~~respectively~~was all raw materials.

~~During~~NOTE ~~the~~7 ~~three~~– ~~and~~CAPITAL nine months ended December 31, 2019, the Company wrote off $48,203 of inventory as scrap costs. The scrap was incurred as early production yielded undesirable results. Due to the cost of scrap materials incurred during the three and nine months ended December 31, 2019, gross margin was negative for each period.STOCK

NOTE 7 – DEFERRED REVENUE

During the year ended March 31, 2019, the Company accepted pre-orders of its products totaling $814 which was carried as deferred revenue as of March 31, 2019. The Company accepted additional prepaid sales of $3,000 during the nine months ended December 31, 2019 for product which has yet to ship resulting in a total deferred revenue balance of $3,814 as of December 31, 2019.

NOTE 8 – CAPITAL STOCK

Authorized

The Company is authorized to issue up to 20,000,000 shares of $0.001 par value Series A Preferred Stock, 5,000,000 shares of $0.001 par value Series B Preferred Stock and 100,000,000 shares of $0.001 par value Common Stock.

The holders of the Series A Preferred Stock are entitled to 10 votes for each share held. Each share of Series A Preferred Stock is convertible into 10 shares of Common Stock at the discretion of the Company’s directors. In the event that there is a change of control transaction, each share of Series A Preferred Stock is convertible into 10 shares of Common Stock at the option of the holder. The holders of the Series A Preferred Stock are entitled to participate in dividends. Dividends are non-cumulative and are at the discretion of the Company’s directors.

The holders of the Series B Preferred Stock are entitled to 4 votes for each share held. Each share of Series B Preferred Stock is convertible into 4 shares of Common Stock at the discretion of the stockholder. The holders of the Series B Preferred Stock are entitled to participate in dividends. Dividends are non-cumulative and are at the discretion of the Company’s directors.

Issued

During the ~~nine~~three months ended ~~December~~June 3130, ~~2019~~ 2020, the Company accepted stock subscriptions to issue a total of ~~136~~6,~~000~~184,800 shares of common stock at $0.25 per share resulting in total cash proceeds of $341,~~000~~546,201. Of this amount, 6,148,560 shares of common stock were issued to related parties for total cash proceeds of $1,537,140.

During the ~~nine~~three months ended ~~December~~June 3130, ~~2019~~2020, the Company issued a total of 2739,~~544,375~~800 shares of Series B Convertible Preferred Stock for total cash proceeds of $1517,~~664,000~~860. OfAll ~~this amount, 1,138,625 shares of Series B Convertible Preferred Stock~~ was issued to related parties ~~for total cash proceeds of $820,550~~. Additionally, the Company paid approximately $~~110~~200,00000 to a related party as a finders’ fee in conjunction with the sale of equity investments. The finder’s fee is considered a direct incremental cost associated with the sale of the stock and as such is treated as a reduction to the proceeds and, accordingly as an offset to additional paid in capital.

~~There were 19,999,998; 3,910,000 and 7,320,858 shares of Series A Convertible Preferred Stock, Series B Preferred Stock and Common Stock issued and outstanding as of December 31, 2019.~~6

There were 19,999,998, 1,365,625 and 7,184,858 shares of Series A Convertible Preferred Stock, Series B Preferred Stock and Common Stock issued and outstanding as of March 31, 2019.

Shareholder Contributions

During the nine months ended December 31, 2019, the Company received $3,040 in cash from a shareholder as a capital contribution.

Additionally during the nine months ended December 31, 2019, two former officers of the Company forgave accrued wages totaling $73,738 which was treated as a forgiveness of debt by a related party resulting in a capital contribution of $73,738.

TRIBUS ENTERPRISES, INC.

Notes to Unaudited Consolidated Condensed Financial Statements

~~December~~June 3130, ~~2019~~2020

NOTE 97 – ~~OPERATING~~CAPITAL ~~LEASES~~STOCK (CONTINUED)

There were 19,999,998; 4,649,800 and 13,545,658 shares of Series A Convertible Preferred Stock, Series B Preferred Stock and Common Stock issued and outstanding as of June 30, 2020.

There were 19,999,998, 3,910,000 and 7,360,858 shares of Series A Convertible Preferred Stock, Series B Preferred Stock and Common Stock issued and outstanding as of March 31, 2020.

NOTE 8 – OPERATING LEASES

On March 23, 2017, the Company entered into a lease agreement for the rent of warehouse space that terminates on April 30, 2022 which was amended on May 20, 2017. Additionally, on March 12, 2019, the Company entered into an additional lease for the rent of warehouse space that terminates on March 31, 2022.

On April 1, 2019, the Company recorded a right of use asset and operating lease liability totaling $207,359 using an imputed interest rate of 25% on its operating leases, equal to the approximate weighted average interest rate imputed on the Company’s existing capital leases. During the ~~nine~~ three months ended ~~December~~June 3130, ~~2019~~2020, the Company made total principal payments on operating leases of $3614,~~593~~958. There was a total operating lease liability of $~~170~~141,~~766~~978 as of ~~December~~June 3130, ~~2019~~2020 of which $6170,~~886~~813 was current and $~~108~~71,~~880~~165 was long term.

The leases require future minimum payments as shown below:

Year ending March 31,
2020	$	26,128
2021			73,746
2021		98,207
2022			99,725
2022		99,725
2023			4,321
2023		4,321
Total payments			177,792
Total payments		228,381
Less: imputed interest			(35,814	)
Less: imputed interest		(57,615	)
Operating lease liability, total		$	141,978
Operating lease liability, total	$	170,766

On ~~November~~May 58, ~~2018~~2019, the Company entered into a ansublease agreement towhereby it will sublet a portion of its ~~office~~ space onfor a ~~month~~period toof ~~month~~twelve ~~basis~~months commencing on May 1, 2019. The sublease ~~will~~requires ~~continue~~a onprorated aamount ~~month~~of torent ~~month~~of ~~basis~~$1,800 ~~until~~for ~~the~~May ~~sublessor~~2019 ~~provides~~followed ~~notice~~by toeleven ~~execute~~monthly payments of $4,100 through April 2020. On May 28, 2020, a ~~long~~new ~~term~~sublease ~~lease~~agreement orwas ~~will~~entered ~~have~~into ~~the~~for ~~option~~a toperiod ~~assume~~of ~~the~~23 ~~Company’s~~months ~~lease~~commencing on June 1, 2020. The sublease requires monthly rental payments of $51,~~700 with the first month being prorated accordingly~~200.

On May 811, ~~2019~~2020, the Company entered into a separate sublease agreement whereby it will sublet a portion of its space for a period of ~~twelve~~24 months commencing on May 1, ~~2019~~2020. The sublease requires amonthly ~~prorated~~rental ~~amount~~payments of ~~rent total~~ $1,~~800~~875. In addition, a verbal agreement was entered into on a month to month basis for ~~May~~additional ~~2019~~space ~~followed~~to bysublet ~~eleven~~as needed for a monthly ~~payments~~rental payment of $41,~~100 through April 2020~~510.

The Company records sublease payments received as other income in the statement of operations resulting in other income of $128,~~300~~378 and $339,~~600~~000 being recognized during the three ~~and nine~~ months ended ~~December~~June 3130, 2020 and 2019, respectively. The Company has not been released from its obligations under the master lease and accounts for rental income from subleases on a straight line basis monthly. As of June 30, 2020, the sublease did not impair the right of use asset recorded as part of the master lease agreement.

~~NOTE~~The 10subleases –provide ~~LOANS~~future ~~PAYABLE~~income as shown below:

During the prior fiscal year, the Company entered into a loan in order to acquire a vehicle. The loan is repayable over five years at $541 per month, is secured by the vehicle and bears interest at 0%. Management determined that the fair value of the loan was not significantly different from its face value and therefore no discount has been recorded. During the nine months ended December 31, 2019, the Company sold the vehicle for the remaining balance on the loan resulting in a balance due of $0 as of December 31, 2019.

Year ending March 31,
2021		27,675
2022		36,900
2023		3,075
Other income from subleases, total	$	67,650

On July 27, 2018, the Company entered into a loan agreement to borrow $100,000. The loan carries an interest rate of 24.37%, is payable over twelve months and due on July 27, 2019. There was $0 and $65,464 of principal due as of December 31, 2019 and March 31, 2019, respectively.7

~~During~~TRIBUS ~~the year ended March 31~~ENTERPRISES, ~~2019, the Company entered into a loan in order to acquire equipment~~INC. The loan is repayable over twelve months at $954 per month, is secured by the equipment and bears interest at 0%. Management determined that the fair value of the loan was not significantly different from its face value and therefore no discount has been recorded. There was $0 and $10,497 due as of December 31, 2019 and March 31, 2019, all of which was current.

Notes to Unaudited Consolidated Condensed Financial Statements

June 30, 2020

NOTE 9 – LOANS PAYABLE

As of March 31, 2020, the Company had outstanding two separate loan agreements to purchase equipment totaling $407,644, each with no stated interest rate.

•

The first loan was for equipment valued at $270,604 and required $27,990 down with six monthly payments of $5,000 and a balloon payment of $221,910 unless otherwise negotiated prior to maturity. During the three months ended December 31, 2019, the Company renegotiated the note to require monthly payments of $5,000 until paid in full, removing the balloon payment. During the three months ended June 30, 2020 this loan was paid in full.

•

The second loan was for equipment valued at $137,040 and required $5,000 down with 6 monthly payments of $1,000 and a balloon payment of $126,040 unless otherwise negotiated prior to maturity. During the three months ended December 31, 2019, the Company renegotiated the note to require monthly payments of $5,000 until paid in full, removing the balloon payment. During the three months ended June 30, 2020 this loan was paid in full.

On April 28, 2020, the Company entered into an agreement to purchase equipment totaling $146,340. The agreement required $29,268 down with six monthly payments of $5,000 and the remaining balance due thereafter. During the three months ending June 30, 2020, the Company applied an additional $13,500 toward the loan. As of June 30,2020, there was a total of $98,572 due all of which is current.

On June 1, 2019, the Company entered into a loan to borrow $34,222 to purchase a vehicle. As part of the agreement, the Company traded in its existing vehicle for total consideration of $19,464 resulting in a net loss recorded on the asset of $1,751. The loan carries interest at a rate of 6.59% per annum and matures in September 2025. As of June 30, 2020, there was a total of $28,674 due of which $4,948 was current.

Total loans outstanding at June 30, 2020 were $141,550 of which $117,824 was current and $23,726 was long term.

NOTE 10 – FINANCING LEASES PAYABLE

In February 206, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes guidance in ASC 840, Leases, which the Company adopted for the year ended March 31, 2020 under the modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application Results and disclosure requirements for reporting periods beginning after March 31, 2019 are presented under Topic 842 while prior period amounts have not been adjusted and continue to be reported in accordance with the Company’s historical accounting under Topic 840.

The Company accounts for financing leases in accordance with ASC 842. As of June 30,2020, the Company had one outstanding long-term lease for equipment that grants the Company the option to purchase the underlying asset at lease termination that the Company is reasonably certain to exercise. The Company determined this was a financing lease based on the reasonable certainty the Company will exercise its right to purchase the underlying assets and capitalized the net present value of the lease which totaled $275,950 as equipment. The leases require total monthly payments of $5,369.

As of June 30, 2020, there was a total of $242,308 of future payments due through February 2023 of which $55,413 are financing charges leaving a total principal balance of $186,895. Of the total principal balance due, $86,989 was current and $99,906 was long term as of June 30, 2020.

On various dates during the nine months ended December 31, 2019, the Company entered into five separate verbal loan agreements to purchase equipment totaling $501,077, each with no stated interest rate. The Company recorded the loans using an imputed interest rate of 6.59% per annum, equal to the interest rate associated with other recent borrowings on assets.

● The first of five loans was for equipment valued at $270,604 and required $27,990 down with six monthly payments of $5,000 and a balloon payment of $221,910 unless otherwise negotiated prior to maturity. During the three months ended December 31, 2019, the Company renegotiated the note to require monthly payments of $5,000 until paid in full, removing the balloon payment.

● The second of five loans was for equipment valued at $24,163 and required $2,500 down with six monthly payments of $1,000 and a balloon payment of $16,395 unless otherwise negotiated prior to maturity. This loan was repaid in full during the period ended December 31, 2019.

● The third of the of five loans was for equipment valued at $36,884 and requires monthly payments of $5,000 until paid in full unless otherwise negotiated prior to maturity. This loan was repaid in full during the period ended December 31, 2019.

●

● The fourth of five loans was for equipment valued at $137,040 and required $5,000 down with 6 monthly payments of $1,000 and a balloon payment of $126,040 unless otherwise negotiated prior to maturity. During the three months ended December 31, 2019, the Company renegotiated the note to require monthly payments of $5,000 until paid in full, removing the balloon payment.

●

● The fifth of five loans was for equipment valued at $32,386 and required $6,477 down with 3 monthly payments of $6,477 and one payment of $6,478 unless otherwise negotiated prior to maturity. This loan was repaid in full during the period ended December 31, 2019.

On June 1, 2019, the Company entered into a loan to borrow $34,222 to purchase a vehicle. As part of the agreement, the Company traded in its existing vehicle for total consideration of $19,464 resulting in a net loss recorded on the asset of $1,751. The loan carries interest at a rate of 6.59% per annum and matures in September 2025. As of December 31, 2019, there was a total of $31,977 due of which $4,720 was current.

Total loans outstanding at December 31, 2019 were $376,927 of which $349,670 was current and $27,257 was long term.

NOTE 11 – CAPITAL LEASES PAYABLE

The Company accounts for capital leases in accordance with ASC 842. During the year ended March 31, 2019, the Company entered into seven separate long-term leases for equipment that contain a $1 buyout option upon lease termination as well as others that contain bargain purchase option upon the lease termination. The Company determined these were capital leases based on the minimum buy out price and capitalized the net present value of the leases which totaled $1,162,240 as equipment. The leases require total monthly payments of $34,171.

TRIBUS ENTERPRISES, INC.

Notes to Unaudited Consolidated Condensed Financial Statements

~~December~~June 3130, ~~2019~~2020

NOTE 1110 – ~~CAPITAL~~LEASE ~~LEASES~~FINANCING PAYABLE (CONTINUED)

AsFuture ofannual ~~December~~payments ~~31,~~required ~~2019,~~under the ~~there~~capital ~~was~~lease ~~a total of $1,046,115 of future payments due~~ through ~~June~~termination ~~2023 of which $287,972~~ are ~~financing charges leaving a total principal balance of $758,143. Of the total principal balance due, $301,162 was current and $456,981 was long term~~ as ~~of December 31, 2019.~~follows:

Future annual payments required under the capital leases through termination are as follows:

	Principal		Interest		Total
Year ended March 31,
2021		74,725		38,025		112,750
2022		51,769		12,659		64,428
2023		60,401		4,729		65,130
Total	$	186,895	$	55,413	$	242,308

	Principal		Interest		Total
Year ended March 31,
2020	$	115,731	$	90,693	$	206,424
2021		268,302		137,008		405,310
2022		259,304		50,164		309,468
2023		107,662		9,864		117,526
2024		7,144		243		7,387
Total	$	758,143	$	287,972	$	1,046,115

NOTE 11 – LEGAL PROCEEDINGS

During the year ended March 31, 2020, the Company was a party to two separate lawsuits. The company settled each lawsuit on June 19, 2020 that required a cash settlement totaling $140,750 which was included in accounts payable and accrued liabilities as of March 31, 2020.

NOTE 12 – SUBSEQUENT EVENTS

The Company evaluated all events occurring subsequent to ~~December~~June 3130, ~~2019~~2020 and through the date of this filing and determined there were no additional disclosures required.

109

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

FORWARD-LOOKING STATEMENTS

This Form 10-Q includes "“forward-looking statements"” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included or incorporated by reference in this Form 10-Q which address activities, events or developments which the Company expects or anticipates will or may occur in the future, including such things as future capital expenditures (including the amount and nature thereof); finding suitable merger or acquisition candidates; expansion and growth of the Company'’s business and operations; and other such matters are forward-looking statements. These statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. However, whether actual results or developments will conform with the Company'’s expectations and predictions is subject to a number of risks and uncertainties, including general economic, market and business conditions; the business opportunities (or lack thereof) that may be presented to and pursued by. the Company; changes in laws or regulation; and other factors, most of which are beyond the control of the Company.

These forward-looking statements can be identified by the use of predictive, future-tense or forward-looking terminology, such as "“believes,"” "“anticipates,~~" "~~” “expects,"” "“estimates,"” "“plans,"” "“may,"” "“will,"” or similar terms. These statements appear in a number of places in this Filing and include statements regarding the intent, belief or current expectations of the Company, and its directors or its officers with respect to, among other things: (i) trends affecting the Company'’s financial condition or results of operations for its limited history; (ii) the Company'’s business and growth strategies; and, (iii) the Company'’s financing plans. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. Such factors that could adversely affect actual results and performance include, but are not limited to, the Company'’s limited operating history, potential fluctuations in quarterly operating results and expenses, government regulation, technological change and competition.

Consequently, all of the forward-looking statements made in this Form 10-Q are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequence to or effects on the Company or its business or operations. The Company assumes no obligations to update any such forward-looking statements.

General Business Development

The Company was formed on March 29, 2017 in the State of Washington.

Business Strategy

Upon incorporation, the Company entered into a share exchange agreement with Tribus Innovations, LLC (“Tribus Innovations”) and acquired all of the outstanding ownership interests of Tribus Innovations. Tribus Innovations was formed on December 1, 2015. The transaction was accounted for as a reverse merger and these financial statements present the historical financial information of Tribus Innovations from its inception and include the financial information of the Company from the completion of the share exchange agreement on March 29, 2017. The Company has realized limited revenues from its planned business activities. The membership interests of Tribus Innovations, LLC were all held by the officers and directors of Tribus Enterprises, Inc. The Company acquired 100% of the membership interests of Tribus Innovations, LLC in exchange for 2,600,000 of our common shares and 19,999,998 of our shares of Class A preferred stock. Tribus Innovations is currently a 100% owned subsidiary of the Company.

Tribus LLC was formed in December 2015 to develop, manufacture, and market a compelling product line of innovative ratcheting flare nut wrenches which have been issued a Patent under application number: 15/092,056 which was issued on September 17, 2019 under Patent Number 10,414,029. The initial product line uses traditional manufacturing methods of metal forging, subtractive manufacturing (CNC milling), additive manufacturing (3D printing), and plastic injection molding. ~~Tribus LLC has made several plastic resin prototypes in 2016.~~

~~Tribus has produced several wrenches already and is setting up the production line for full production this year.~~10

Products

Tribus LLC’s ratcheting flare nut wrench addresses the market in a way that has never been done before; reducing the time it takes to turn inline fasteners.

11• Ease of Use – There are no buttons or switches. In order to reverse the tightening direction, simply remove the tool and rotate it 180°.

• ~~Ease~~ Learning Curve of– ~~Use~~This –works ~~There~~the ~~are~~same noas ~~buttons~~a orstandard ~~switches.~~open Inended ~~order~~wrench tobut ~~reverse~~it has the ~~tightening~~ability ~~direction~~to ratchet, saving valuable time. There will be a very short and slight learning curve as the users will simply need to remove the tool off the fastener and ~~rotate~~line itup ~~180°~~the open slots to remove the tool completely off the line.

• ~~Learning~~ Heavy Torque ~~Curve~~application – ~~This~~Due ~~works~~to the ~~same~~design asof athe ~~standard~~pawls ~~open~~that ~~ended~~engage ~~wrench~~into ~~but it has~~ the ~~ability to~~ ratchet, ~~saving~~it ~~valuable~~has ~~time.~~at ~~There~~least ~~will~~4x bemore acontact ~~very~~surfaces than ~~short~~standard ~~and~~ratcheting ~~slight~~wrenches. ~~learning~~This ~~curve as the users~~ will ~~simply~~translate ~~need~~ to ~~remove~~much ~~the~~more ~~tool~~application ~~off~~of ~~the fastener and line up the open slots to remove the tool completely off the line~~torque.

• ~~Heavy~~ Convenience in ~~Torque~~tight ~~application~~spaces – ~~Due~~Pawls tohave ~~the~~been ~~design~~designed ofalong with corresponding grooves in the ~~pawls~~ratchet ~~that~~so ~~engage~~users ~~into~~can ~~the~~maximize ratchet, pitch. itIt ~~has~~will atonly ~~least~~take 4x2°- ~~more~~4° ~~contact~~to ~~surfaces~~get ~~than~~the ~~standard~~ratchet ~~ratcheting~~to ~~wrenches~~click. This ~~will~~is ~~translate~~crucial toin ~~much~~tight ~~more~~spaces ~~application~~where ofthere ~~torque~~is very little room to swing the ratchet.

~~• Convenience~~Tribus inInnovations’ ~~tight~~ratcheting ~~spaces~~flare nut –wrench ~~Pawls~~is ~~have~~being ~~been~~produced ~~designed~~for ~~along~~sale ~~with~~in ~~corresponding~~the ~~grooves~~hand tool industry. Historically there have been limited designs in the ~~ratchet~~ratcheting flare sonut ~~users~~wrench ~~can~~sales ~~maximize~~market ~~ratchet~~such ~~pitch.~~as; ItGear ~~will~~Wrench ~~only~~part ~~take~~number ~~2°-~~89100 4°(UPC to099575891007) ~~get~~and the ~~ratchet~~traditional tonon-ratcheting ~~click~~flare nut wrench. ~~This~~These isdesigns ~~crucial~~do not allow for small incremental movement in ~~tight~~confined spaces, ~~where~~whereas ~~there~~Tribus isInnovations’ ~~very~~version of ~~little~~the ~~room~~ratcheting toflare ~~swing~~nut ~~the~~wrench ~~ratchet~~breaks new ground in this market.

~~Tribus~~In ~~Innovations’~~addition, ~~ratcheting~~using ~~flare nut wrench will be produced for sale in~~ the ~~hand~~same ~~tool~~technology as ~~industry. Historically there have been limited designs in~~ the ratcheting flare nut wrench ~~sales~~and ~~market~~covered ~~such~~under ~~as;~~the ~~Gear~~same ~~Wrench~~patent, ~~part~~Tribus ~~number~~has ~~89100~~developed ~~(UPC~~a ~~099575891007)~~new ~~and~~tool ~~the~~to ~~traditional~~add ~~non-ratcheting~~to ~~flare~~its ~~nut~~tool ~~wrench~~line. Production ~~These~~began ~~designs do not allow for small incremental movement~~ in ~~confined~~July ~~spaces,~~2020 ~~whereas~~with ~~Tribus~~the ~~Innovations’~~first ~~version~~batch of ~~the~~product ~~ratcheting~~to ~~flare~~be ~~nut~~completed ~~wrench~~and ~~breaks~~launched ~~new~~the ~~ground~~end inof ~~this~~August ~~market~~2020.

~~Liquidity~~On March 11, 2020, the World Health Organization characterized COVID-19 as a global pandemic. We are monitoring the situation closely and ~~Capital~~our ~~Resources~~response to the COVID-19 pandemic continues to evolve. We have taken measures to mitigate the impact on our business operations and overall financial performance. We are also constantly evaluating and responding to the impact of the pandemic on our supply chain as compared to product demand. In addition, we actively monitor COVID-19-related developments and may take further actions that alter our business operations as may be required by federal, state, or local authorities or that we determine are in the best interests of our employees, customers, vendors, and stockholders. The effects of these operational modifications will be reflected in current and future reporting periods.

AsLiquidity ~~of December 31, 2019, we had $423,674 in cash, total current assets of $909,467~~ and ~~total~~Capital current liabilities of $896,223. Current liabilities consisted mainly of $129,274 of accounts payable, a capital lease liability of $301,162, an operating lease liability of $61,886 and current loans payable of $349,670.Resources

As of ~~March~~June 3130, ~~2019~~2020, we had ~~current~~$909,842 in cash, total current assets ~~totaling~~of $~~455~~978,~~981~~001 ~~consisting~~and total current liabilities of $33504,~~970~~995. Current assets consisted of $909,842 of cash, $~~402~~36,~~000~~384 of ~~current~~prepaid expenses ~~deposits~~ and $2031,~~011~~775 of ~~prepaid expenses~~inventory. Current liabilities ~~totaled~~consisted mainly of $~~437~~204,~~680~~120 asof accounts payable and accrued liabilities, a capital lease liability of ~~March~~$86,989, 31an operating lease liability of $70,813 ~~2019~~and current loans payable of $117,824.

Net cash used in operating activities was $~~873~~491,~~548~~435 compared to $~~850~~157,~~970~~644 for the ~~nine~~three months ended ~~December~~June 3130, ~~2019~~2020 and ~~2018~~2019, respectively.

Net cash ~~used~~provided inby investing activities was $3176,~~758~~162 compared to net cash used of $5830,~~840~~918 for the ~~nine~~three months ended ~~December~~June 3130, ~~2019~~2020 and ~~2018~~2019 respectively.

Net cash provided by financing activities was $1,~~267~~074,~~010~~374 and $~~114~~202,~~936~~707 for the ~~nine~~three months ended ~~December~~June 3130, ~~2019~~2020 and ~~2018~~2019, respectively.

Going Concern

The future of our company is dependent upon its ability to obtain financing and upon future profitable operations. Management has plans to seek additional capital through a private placement and public offering of its common stock, if necessary. See Note 3 to the financial statements for additional information.

Results of Operations

We generated limited revenues during the three ~~and nine months~~ ended ~~December~~June 3130, ~~2019~~2020 and no revenues during the three ~~and nine months~~ ended ~~December~~June 3130, ~~2018~~2019. Total operating expenses were $~~473~~211,~~213~~456 ~~during the three months ended December 31, 2019~~ and $~~171~~301,~~785~~550 during ~~for~~ the three months ended ~~December~~June 3130, ~~2018.~~2020 ~~Total operating expenses were $1,069,710 during the nine months ended December 31, 2019~~ and ~~$535~~2019,~~613~~ ~~for the nine months ended December 31, 2018~~respectively. The ~~increase~~decrease in operating expenses for the three ~~and nine~~ months ended June ~~December 31~~30, ~~2019~~2020 when compared to the same periods in ~~2018~~2019 ~~were~~was due to ana ~~increase~~decrease in ~~the~~general ~~company’s operations~~ and ~~preparation~~administrative ~~in the current year~~expenses. Net loss for the three months ended ~~December~~June 3130, ~~2019~~2020 was $~~556~~316,~~258~~283 compared to $~~204~~355,~~694~~398 for the same period in ~~2018. Net loss for the nine months ended December 31,~~ 2019 ~~was $1,256,412 compared to $592,716 for the same period in 2018~~.

CRITICAL ACCOUNTING POLICIES

In Financial Reporting release No. 60, "CAUTIONARY ADVICE REGARDING DISCLOSURE ABOUT CRITICAL ACCOUNTING POLICIES" ("FRR 60"), the Securities and Exchange Commission suggested that companies provide additional disclosure and commentary on their most critical accounting policies. In FRR 60, the SEC defined the most critical accounting policies as the ones that are most important to the portrayal of a company's financial condition and operating results, and require management to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, our most critical accounting policies include: going concern, inventory, revenue recognition and ~~capital~~finance leases payable.. The methods, estimates and judgments we use in applying these most critical accounting policies have a significant impact on the results we report in our financial statements.

1211

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is not exposed to market risk related to interest rates or foreign currencies.

ITEM 3A. OFF BALANCE SHEET ARRANGEMENTS

The Company has not entered into any off balance sheet arrangements.

CONTROLS AND PROCEDURES

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As required by Rule 13a-15 under the Securities Exchange Act of 1934 (the “1934 Act”), as of ~~December~~June 3130, ~~2019~~2020, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer (our principal executive officer) and our Chief Financial Officer (our principal financial officer), who concluded, that because of the material weakness in our internal control over financial reporting (“ICFR”) our disclosure controls and procedures were not effective as of ~~December~~June 3130, ~~2019~~2020.

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during the current quarter that have materially affected, or are reasonable likely to materially affect, our internal control over financial reporting.

PART II OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There ~~are~~were ~~currently~~ two lawsuits ~~pending~~ in Montgomery County, Ohio involving Tribus. The first iswas Tribus Enterprises, Inc. v. Dynamic Machine Works, LLC, et al., Montgomery County common Pleas Case No. CV 1393 (“Tribus Lawsuit”). The second iswas Dynamic Machine Works, LLC v Clark Trost, et al., Montgomery County Common Pleas Case No. 2019 CV 1753 (“Trost Lawsuit”). There ~~has~~was also ~~been~~ additional litigation threatened by Dynamic Machine Works, LLC (“DMW”).

A. Tribus Lawsuit

Tribus filed the Tribus Lawsuit against DMW on April 1, 2019 and filed an amended complaint against DMW and one of its owners, Nathan Hake, on May 15, 2019. Those complaints asserted ~~assert~~ numerous claims against DMW and Hake arising from their manufacturing relationship. Tribus’s claims against DMW were ~~are~~ for breach of contract, unjust enrichment, and promissory estoppel. Tribus’s claims against Hake ~~are~~were for unjust enrichment, fraud, promissory estoppel, conversion, and tortious interference.

Tribus’s ~~claims~~claim in the Tribus Lawsuit alleged ~~allege~~ that Hake and DMW misrepresented their expertise and ability in order to obtain the contract to manufacture Tribus’s wrenches. DMW then received $402,000 from Tribus as part of that contract, and ultimately failed to produce any functional wrenches. Tribus’s claims ~~seek~~sought the return of the $402,000 paid to DMW, together with any equipment and tooling purchased by Tribus or with Tribus’s funds that ~~continues~~continued to be held by DMW or Hake.

13DMW filed counterclaims against Tribus in the Tribus Lawsuit. DMW sued Tribus for breach of contract, promissory estoppel/detrimental reliance, breach of ND/NCA, theft of trade secrets, tortious interference with prospective and actual business relationships, unjust enrichment, conversion, breach of duty of loyalty or fiduciary duty, unfair competition, deceptive trade practices, and breach of lease agreement.

DMW has filed counterclaims against Tribus in the Tribus Lawsuit. DMW has sued Tribus for breach of contract, promissory estoppel/detrimental reliance, breach of ND/NCA, theft of trade secrets, tortious interference with prospective and actual business relationships, unjust enrichment, conversion, breach of duty of loyalty or fiduciary duty, unfair competition, deceptive trade practices, and breach of lease agreement.12

DMW’s claims against Tribus primarily asserted ~~assert~~ that Tribus stole DMW’s confidential information and trade secrets. Namely, the programming and manufacturing process for the wrenches. DMW also ~~asserts~~asserted that it was Tribus who breached the contract with DMW. DMW’s counterclaims against Tribus center on Tribus’s decision to terminate its relationship with DMW and enter into an agreement with Clark Trost for the manufacture of the wrenches instead. Trost had been an independent contractor hired by DMW to help DMW manufacture Tribus’s wrenches. DMW’s counterclaims ~~request~~requested judgement in excess of $2 million.

ToThe ~~date, the~~ Tribus Lawsuit ~~has seen considerable activity for its nascent stage. It~~ was filed primarily to compel the return of nearly $1.2 million in manufacturing equipment purchased or leased by Tribus and being held at DMW’s facility in Englewood, Ohio. That objective was largely accomplished with the return of the vast majority of the equipment on April 24th, 2019, following a motion for temporary restraining order and preliminary injunction filed on Tribus’s behalf. Certain miscellaneous pieces of equipment remain to be returned however. Those pieces (or their value), and the monetary portion of Tribus’s claims remain to litigated, as do DMW’s counterclaims against Tribus.

Tribus has vigorously prosecuted its claims and defended against DMW’s counterclaims to date. The Company believes there is a good chance that Tribus will prevail on its claims against DMW, and that DMW will not be successful on its claims against Tribus. Given the range and variety of claims against Tribus by DMW however, it is impossible to provide a range of potential loss with any specificity.

There are additional considerations involving the Tribus Lawsuit. First, DMW has filed a motion with the court to stay that lawsuit and compel arbitration. Tribus has opposed that motion and we are awaiting a decision from the court. Second, Hake has filed bankruptcy in the United States Bankruptcy Court for the Southern District of Ohio, which will necessitate the dismissal of Tribus’s claims against Hake personally. Tribus does not intend to pursue a judgement or claim against Hake in the bankruptcy matter, given the low likelihood of collection and the cost of such pursuit.

On September 14, 2019, the United States Bankruptcy Court for the Southern District of Ohio issued an order denying Nathan Hake a discharge in bankruptcy, and his bankruptcy proceedings have now concluded. As a result, Tribus is entitled to continue pursuing its claims against Hake personally in the Tribus Lawsuit.

On December 11, 2019, the trial court denied DMW’s motion to stay the Tribus Lawsuit and compel arbitration. The deadline to appeal that decision has now passed, and was not appealed. In addition, the trial court granted Tribus’s motion to consolidate the Tribus Lawsuit and the Trost Lawsuit. Consequently, the Tribus Lawsuit and the Trost Lawsuit are now proceeding as a single lawsuit.

On December 16, 2019, counsel for DMW filed a motion to withdraw as counsel from both the Tribus Lawsuit and the Trost Lawsuit, citing lack of payment by DMW and a separate, unrelated conflict. On January 23, 2020, the trial court granted that motion to withdraw, leaving DMW and Hake without counsel of record in either lawsuit.

None of the above actions name the officers or directors of Tribus individually.

B. Trost Lawsuit

In addition to its counterclaims against Tribus, DMW filed a separate lawsuit against Clark Trost and two companies he owns, Trost Technologies, Inc. and CNC Holsters, LLC (collectively “Trost”). Tribus ~~has~~ signed and engagement letter with McNamee & McNamee, PLL agreeing to be responsible for the attorneys’ fees and costs of representing Trost in the Trost Lawsuit as well.

DMW’s claims against Trost are for breach of ND/NCA, theft of trade secrets, tortious interference with prospective and actual business relations, unjust enrichment, conversion, breach of duty of loyalty or fiduciary duty, unfair competition, deceptive trade practices, and breach of oral sub-lease agreement. DMW’s complaint in the Trost Lawsuit ~~seeks~~sought damages in excess of $2 million.

The crux of DMW’s claims in the Trost Lawsuit ~~mirror~~mirrored its counterclaims in the Tribus Lawsuit. In essence, DMW maintains that Tribus and Trost conspired to steal the programming and manufacturing information for Tribus’s wrenches----which DMW claims to be its confidential information and trade secrets----to terminate their relationships with DMW and enter into business together to manufacture the wrenches without DMW.

14The Company settled each lawsuit on June 19, 2020 that required a cash settlement totaling $140,750 to be paid by Tribus to DMW. In exchange for the cash payment, the Company was able to recover some materials in DMW’s possession and was provided clear rights to utilize the intellectual property developed throughout the prior relationship with DMW. This amount was accrued for during the year ended March 31, 2020.

The Trost Lawsuit has seen considerable activity to date as well. In addition to substantial motion practice, DMW has filed a motion for temporary restraining order and preliminary injunction, seeking to prevent Trost from doing any business with Tribus. The motion for temporary restraining order and preliminary injunction was referred to a magistrate for decision. In Ohio, a judge can refer a matter to a magistrate for decision, but a magistrate’s decision is not effective until it is adopted by the judge. Following a magistrate’s decision, any party is permitted to file objections to that decision with the judge, and the judge must then perform an independent review of the record of proceedings before the magistrate before deciding whether to adopt or reject the magistrate’s decision.

An evidentiary hearing was held on DMW’s motion on May 13, 2019, and June 26, 2019. On August 6, 2019, the magistrate issued a decision in favor of DMW, which was later amended in another magistrate’s decision dated August 27, 2019. Trost has filed objections to the magistrate’s. If adopted by the judge, the magistrate’s decision would prohibit Trost from performing any work for Tribus. Trost filed objections to the magistrate’s decision, and the judge has not adopted or rejected the magistrate’s decision. Until such action is taken by the judge, the magistrate’s decision is not effective.

Here too, the Company believes there is a good chance that DMW will not be successful on its claims against Trost, nor on its motion for preliminary injunction. The Company is confident that, ultimately, it will be determined that the manufacturing and programming information that form the core of DMW’s claims against both Tribus and Trost is not in fact confidential information or trade secrets belonging to DMW.

ITEM 1A. RISK FACTORS

There has been no material changes in the risk factors set forth in the Company’s Form 10K for the period ended March 31, ~~2019~~2020 filed July 1914, ~~2019~~2020.

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

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 3A. OFF BALANCE SHEET ARRANGEMENTS

The Company has not entered into any off balance sheet arrangements.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

The following documents are included or incorporated by reference as exhibits to this report:

Exhibit Number	Description
31.1	Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**	XBRL Instance
101.SCH**	XBRL Taxonomy Extension Schema
101.CAL**	XBRL Taxonomy Extension Calculation
101.DEF**	XBRL Taxonomy Extension Definition
101.LAB**	XBRL Taxonomy Extension Labels
101.PRE**	XBRL Taxonomy Extension Presentation

(b) REPORTS ON FORM 8-K

None.

1514

SIGNATURES

In accordance with Section 13 or 15 (d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date: ~~February~~August 1419, 2020.

	Tribus Enterprises, Inc.
	Registrant

	By:	/s/ Kendall Bertagnole
		Kendall Bertagnole Chief Executive Officer

1615

Filing Compare · Tribus Enterprises, Inc.