UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 10-K

(Mark One)

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

For the fiscal year ended MAY 31, ~~2021~~2022

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

For the transition period from _______________________ to __________________________

Commission File Number 333-234048

MJ HARVEST, INC.

(Exact name of registrant as specified in charter)

Nevada
(State or other jurisdiction of
incorporation or organization)

82-3400471
(I.R.S. Employer Identification No.)

9205 W. Russell Rd., Suite 240, Las Vegas, NV

(Address of principal executive offices)

89139
(Zip Code)

(954) 519-3115

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: Common Stock

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

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 ☐ [ ] No ☒[X]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ [X] No ☐ [ ]

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes [X] No [ ]

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

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

Large accelerated filer ☐[ ] Accelerated filer ☐[ ] Non-accelerated filer ☐[X] Smaller reporting company ☒[X] 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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act by the registered public accounting firm that prepared or issued its audit report. ☐

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

~~State~~The ~~the~~ aggregate market value of the voting and non-voting common ~~equity~~stock held by non-affiliates computed by ~~reference to~~ the ~~price at which the common equity was sold, or the~~ average bid and asked price of such common equity, ason ofNovember ~~the~~30, ~~last~~2021, ~~business~~was ~~day of the registrant’s most recently completed second fiscal quarter~~$4,700,000.

~~The~~As ~~market value~~ of ~~the~~September ~~voting~~23, ~~and~~2022, ~~non-voting~~there ~~common~~were ~~stock~~44,854,737 ~~held~~shares byof ~~non-affiliates~~the ~~was~~issuer’s ~~$3,170,650~~common onstock ~~November 30, 2020~~outstanding.

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of September 10, there were 31,449,344 shares of the issuer’s common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None.

MJ HARVEST, INC.

TABLE OF CONTENTS TO ANNUAL REPORT ON FORM 10-K

YEAR ENDED MAY 31, ~~2021~~2022

		PAGE
	PART I
Item 1.	Business	54
Item 1A.	Risk Factors	1617
Item 1B.	Unresolved Staff Comments	1617
Item 2.	Properties	17
Item 3.	Legal Proceedings	17
Item 4.	Mine Safety Disclosures	17
	PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters ~~and Issuer Purchases of Equity Securities~~	1718
	and Issuer Purchases of Equity Securities
Item 6.	[Reserved]	19
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	23
Item 8.	Financial Statements and Supplementary Data	2423
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	2423
Item 9A.	Controls and Procedures	24
Item 9B.	Other Information	2524
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	25
	PART III
Item 10.	Directors, Executive Officers and Corporate Governance	25
Item 11.	Executive Compensation	3029
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	31
Item 13.	Certain Relationships and Related Transactions, and Director Independence	3231
Item 14.	Principal Accounting Fees and Services	32
	PART IV
Item 15.	Exhibit and Financial Statement Schedules	33
Item 16.	Form 10-K Summary	34
	SIGNATURES	35

Throughout this report, unless otherwise designated, the terms “we,” “us,” “our,” “the Company” and “our company” refer to MJ Harvest, Inc., a Nevada corporation, and its consolidated subsidiaries. All amounts in this report are in U.S. Dollars, unless otherwise indicated.

FORWARD-LOOKING STATEMENTS

This report on Form 10-K for the year ended May 31, ~~2021~~2022, contains forward-looking statements that are subject to the safe harbors created under the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Act of 1934, as amended (the “Exchange Act”). Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business, including our expectations regarding the potential impacts on our business of the COVID-19 pandemic, and can be identified by the fact that they do not relate strictly to historical or current facts. Such forward-looking statements may include words such as “expect,” “anticipate,” “intend,” “believe,” “estimate,” “plan,” “target,” “strategy,” “continue,” “may,” “~~will,” “~~should,” variations of such words, or other words and terms of similar meaning. All forward-looking statements reflect our best judgment and are based on several factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Such factors include, but are not limited to, those disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business” sections in this report on Form 10-K, and other factors as identified from time to time in our Securities and Exchange Commission reports. Forward-looking statements are based on information available to us us on the date hereof, and we do not have, and expressly disclaim, any obligation to publicly release any updates or any changes in our expectations, or any change in events, conditions, or circumstances on which any forward-looking statement is based. Our actual results and the timing of certain events could differ materially from the forward-looking statements. These forward-looking statements do not reflect the potential impact of any mergers, acquisitions, or other business combinations that had not been completed as of the date of this filing.

Part I

Item 1. ~~Description of~~ Business

Company Background

MJ Harvest, Inc. was ~~first~~incorporated ~~established~~ in Nevada in 2002. ~~Beginning~~Our incurrent ~~2017,~~business wemodel is focused on building a ~~portfolio~~vertically ofintegrated ~~best-in-class~~cannabis ~~products~~company ~~that~~specializing ~~can benefit farmers and hobbyists~~ in ~~their~~manufacturing ~~growing~~ operations., ~~Our~~brand ~~first~~aggregation, ~~product line consists of the DeBudder Lids~~ and ~~EDGE.~~distribution ~~The Debudder is used to strip buds off stems for a variety~~ of ~~plants,~~products ~~including~~utilizing ~~hemp~~ingredients ~~and~~derived from cannabis. WeOur ~~also~~current ~~focused~~operations ~~on building~~are ancentered ~~international~~in ~~network~~Colorado ofand ~~distributors~~California, ~~that~~and ~~can~~through ~~service~~a ~~our~~minority ~~customers~~investment ~~with~~in ~~rapid~~PPK ~~deliveries~~Investment ~~of products stocked in country~~Group, Inc. ~~and developed two e-commerce sites~~(“PPK”), ~~www.procannagor.com~~an ~~and~~Oklahoma ~~www.procannagro.ca~~corporation, ~~with~~we ~~tiered~~have ~~pricing~~extended ~~for the~~our ~~distribution~~market ofreach ~~products~~to inOklahoma, ~~the~~South ~~U.S.~~Dakota and ~~Canada~~Arizona. InWe ~~2020,~~are wecurrently working ~~expanded~~with our ~~product~~Oklahoma ~~offerings~~affiliate to ~~include~~further ~~the~~expand ~~Kalix~~our ~~and~~business ~~NPK~~into ~~product lines~~Florida, ~~which~~Missouri, ~~offer~~New ~~customers~~Jersey, ~~access~~and toNew ~~plant nutrient products~~York. ~~Currently,~~Our ~~the~~business ~~Company sells the debudder products through several~~model ~~distributors~~is ~~and~~constantly ~~online~~evolving to ~~retail~~take ~~customers.~~into ~~The~~account ~~loss~~the ofscope ~~any~~ of our ~~three~~market ~~largest~~presence, ~~distributors~~the ~~could~~brands ~~have~~included ain ~~material impact on~~ our ~~sales~~brand ofportfolio, ~~debudder products. Our sales of the Kalix~~ and ~~NPK product lines are dependent on~~ the ~~ability of Kalix and NPK to~~relationships ~~deliver~~we ~~products~~have aswith ~~ordered by~~ our ~~customers,~~brands ~~but~~and ~~the~~our ~~sales~~minority ofowned ~~these product lines are not currently a material part of our business~~affiliates.

On August 8, 2022, we entered into an Agreement of Merger and Plan of Reorganization dated August 8, 2022 (the “Merger Agreement”) with Cannabis Sativa, Inc. (“CBDS”), to be effective on the first business day following approval of the Merger by the shareholders of MJHI and CBDS. The Merger Agreement provides for the merger of MJHI with and into CBDS, with CBDS as the surviving entity (the “Merger”). The following listing summarizes material terms of the Merger Agreement.

The name of the surviving company in the Merger will be Cannabis Sativa, Inc.

Following the effective date of the Merger, the corporate existence of MJHI will cease.

Each share of MJHI common stock outstanding on the effective date of the Merger will be converted into 2.7 shares of CBDS Common Stock.

On the effective date of the Merger, the surviving Company will have an aggregate total of 167,369,863 common shares outstanding and no shares of preferred stock outstanding.

Following the Merger, the shareholders of MJHI will hold approximately 72% of the total outstanding shares of common stock of the surviving company, and the shareholders of CBDS will hold approximately 28% of the total outstanding common shares of the surviving company.

The Merger is subject to majority approval of the shareholders of both MJHI and CBDS.

The shareholder meeting to approve the merger is intended to take place at 9205 W. Russell Road, Las Vegas, NV 89148. The date and time of the meeting will depend on the timing for effectiveness of an S-4 Registration Statement to be filed with the United States Securities & Exchange Commission (the “SEC”) to register the shares of CBDS common stock to be issued to the shareholders of MJHI in the Merger and to provide the shareholders of MJHI and CBDS with information about the special meeting of shareholders. Upon effectiveness of the S-4 Registration Statement, the companies will deliver the proxy statement/prospectus to the shareholders. The Prospectus will include the date and time for the respective shareholder meetings.

The shareholders of MJHI and CBDS will have rights to dissent from the Merger, and, if the notice of dissent is properly given, the dissenting shareholders may be paid fair value for such dissented shares.

The Board of Directors of the surviving company following the Merger is intended to consist of Patrick Bilton, Brad Herr, Randy Lanier, Clinton Pyatt, and David Tobias.

The Executive Officers of the Company following the Merger are intended to include Patrick Bilton - Chief Executive Officer, Clinton Pyatt - Chief Operating Officer, and Brad Herr - Chief Financial Officer.

The Merger Agreement includes representations and warranties, covenants, and conditions for MJHI and CBDS as are customary for transactions of this nature.

No brokerage fees are payable in connection with the Merger.

The Merger Agreement may be terminated (i) by mutual consent of the parties; (ii) by either party deciding not to pursue the Merger, subject to payment of $50,000 for such termination; (iii) by MJHI without penalty if due diligence uncovers facts about CBDS’s business or financial condition different that represented prior to execution of the Merger Agreement; or (iv) in the event MJHI’s Board does not approve the Merger.

If the shareholders of either or both companies fail to approve the merger by a majority of the shares outstanding on the record date for the shareholders meeting, the company or companies may continue the shareholders meeting in order to allow more time to solicit proxies for approval of the Merger.

If majority shareholder approval of the merger is not obtained, the Merger will not occur, and the Merger Agreement will be terminated.

All costs and expenses in connection with the Merger transactions will be borne by CBDS, except that MJHI will be responsible for expenses of its own legal counsel and auditing costs.

WeOn ~~continue~~October 8, 2021, we entered into to ~~seek~~two ~~out~~brand ~~additional~~development ~~agricultural~~agreements with WDSY, LLC (“WDSY”) and ~~horticultural~~Blip ~~implements~~Holdings, toLLC ~~add~~(“BLIP”) for toexpansion ~~our~~of ~~product~~the ~~offerings~~“WEEDSY” ~~through~~and ~~distribution~~ “BLVK” brands into Oklahoma and South Dakota. Under the agreements, ~~licensing,~~PPK will manufacture and ~~acquisition~~distribute these brands in Oklahoma and South Dakota and will pay the respective companies 10% royalties on all sales of the branded products in those territories. InWe ~~this~~also ~~aspect~~acquired a 10% interest in WDSY in exchange for 377,358 shares of our ~~business,~~common westock and ~~look~~a ~~for~~10% ~~agricultural~~interest ~~implements,~~in ~~durable~~BLIP ~~goods~~in exchange for 188,679 shares of our common stock. Additional shares may be due to WDSY and BLIP based on ~~services~~lookback ~~that~~valuations of both companies. The lookback valuations will ~~benefit~~be ~~smaller~~based ~~growers~~on oftrailing ~~hemp~~twelve months sales for WDSY and ~~cannabis~~trailing bythree-month sales ~~making~~for ~~their~~BLIP ~~growing~~on ~~operations~~the ~~more~~second ~~efficient~~anniversary of each agreement, or sooner if the agreements are terminated before the second anniversaries.

InAs of May 31, 2022, the ~~Spring~~Company owned 25% of ~~2021,~~PPK ~~MJHI~~and ~~(www~~has the option to expand the investment in PPK to 100%.~~mjhi.com)~~ PPK continues to expand its ~~evaluated~~market ain ~~business~~the ~~opportunity~~industry, with afurther ~~vertically~~explanation ~~integrated~~in ~~marijuana~~Joint ~~company~~Venture inwith ~~Oklahoma~~Tribal Partners. On May 19, 2021, PPK ~~Investment~~entered ~~Group,~~into ~~Inc.~~a cannabis joint venture agreement with the Flandreau Santee Sioux Tribe of South Dakota (“~~PPK~~FSST”). Under the joint venture agreement, PPK opened extraction and ~~signed~~manufacturing afacilities ~~letter~~in ofa ~~intent~~building tolocated ~~acquire~~on the ~~company~~FSST ~~following~~Reservation aand ~~period~~manufactures ofproducts ~~due~~for ~~diligence~~FSST utilizing biomass grown in FSST’s existing and expanding grow operations. InFSST ~~September~~markets ~~2021,~~their weproducts ~~completed~~under anthe ~~steps~~Native toNations Brand. PPK ~~increase~~currently ~~our~~markets ~~initial~~its ~~investment~~products ofunder ~~$1,000,000~~the ~~for~~Country ~~10%~~Cannabis tobrand. ~~$2,500,000~~The ~~for~~joint aventure ~~25%~~agreement ~~interest~~provides inthat PPK and ~~are~~FSST ~~working~~will ~~with~~now ~~PPK~~cross market ~~management~~the other’s brands in their respective states. This provided an opportunity for FSST to expand ~~the~~ ~~business~~its inNative Nations Brand to Oklahoma and ~~other~~for ~~markets.~~PPK ~~Our~~to ~~agreement~~expand ~~with~~its ~~PPK~~Country ~~provides~~Cannabis ~~for~~Brand ~~the~~into ~~eventual~~South ~~acquisition~~Dakota. ofThe upjoint toventure ~~100%~~also ofprovides both PPK ~~provided~~and FSST with ~~the~~additional ~~increased~~capabilities, ~~ownership~~work ~~can~~force, beand ~~accomplished~~other synergies that management believes will benefit both entities. MJHI currently participates as a minority investor in ~~accordance~~PPK ~~with~~and ~~Oklahoma~~expects ~~laws~~its ~~governing~~involvement ~~licensing~~to ofincrease ~~marijuana~~as ~~businesses~~its PPK investment commitment grows and more capital is provided to PPK and the joint venture.

With our ~~the~~acquisitions ~~investment~~in Colorado and California and our investments in PPK, WDSY and BLIP, our long-term focus has shifted, ~~and we now intend~~ to expand ~~business~~our operations ~~beyond the hemp and cannabis agricultural product marketing niche~~ to include vertically integrated cannabis growing operations in Colorado, California, Oklahoma, and South Dakota, and we are actively looking at markets in Arizona, ~~California~~Florida New Jersey, and ~~Florida~~ New York as potential areas for expansion. The timing for development of these expanded operations will depend on availability of growth capital.

OnIn ~~May~~addition ~~19,~~to ~~2021, PPK entered into a cannabis joint venture agreement with~~ the ~~Flandreau~~tribal ~~Santee Sioux Tribe of South Dakota (“FSST”). Under the joint venture agreement~~opportunities, ~~PPK~~we ~~will~~have ~~open~~focused ~~extraction~~much ~~and~~of ~~manufacturing~~our ~~facilities~~growth inefforts ~~a building located~~ on ~~the~~acquiring ~~FSST~~interests ~~Reservation and will manufacture products for FSST utilizing biomass grown~~ in, ~~FSST’s existing~~ and ~~expanding~~licensing ~~grow operations. FSST markets~~agreements ~~their~~with, ~~products~~multiple ~~under~~other ~~the~~brands ~~Native~~of ~~Nations~~cannabis ~~Brand~~products. ~~PPK~~Currently, ~~currently~~we ~~markets~~offer ~~its products in Oklahoma under the~~ Country Cannabis ~~Brand. The~~(the ~~joint~~PPK ~~venture~~brand), ~~agreement~~Weedsy, ~~provides~~BLVK, ~~that PPK~~ and ~~FSST~~Chronic ~~will~~brands (our ~~now~~“Brand ~~cross~~Portfolio”), ~~market~~and ~~the~~we ~~other’s~~are ~~brand~~ in ~~their~~active ~~respective~~negotiations ~~states. This provides an opportunity for FSST~~ to ~~expand~~acquire ~~its~~interests ~~Native~~in, ~~Nations Brand to Oklahoma~~ and ~~for~~licenses ~~PPK~~with, toseveral ~~expand~~other ~~its Country Cannabis~~brands. ~~Brand~~This ~~into~~focus ~~South~~on ~~Dakota.~~brand ~~The~~aggregation ~~joint~~is ~~venture~~a ~~also~~cornerstone ~~provides~~of ~~both~~our ~~PPK~~expansion ~~and~~plans. ~~FSST~~We ~~with~~believe ~~additional~~that ~~capabilities,~~our ~~work~~wholesale ~~force~~customers, ~~and~~consisting ~~other~~primarily ~~synergies~~of ~~that~~dispensaries, ~~management~~will ~~believes~~be ~~will~~more ~~benefit~~receptive ~~both~~to ~~entities.~~our ~~MJHI~~product ~~currently~~offerings ~~participates~~if aswe offer a ~~minority~~wide ~~investor~~range inof ~~PPK~~products and ~~expects its~~price ~~involvement~~points towhile ~~increase~~building our reputation as ~~its~~a ~~PPK~~quality ~~investment~~manufacturer ~~commitment grows~~ and ~~more capital is provided to PPK and the joint venture~~distributor.

Strategy and Objectives

With the initial investment into PPK, and PPK’s cannabis joint venture relationship with FSST, MJHI is poised to take advantage of significant business development opportunities. The following business divisions are either in process, under development, or are being evaluated in an effort to assemble a dynamic enterprise covering all aspects of seed to sale operations in the cannabis and hemp-based CBD sectors. We believe we have selected excellent partners to assist in achieving the strategic vision outlined below.

Prior to 2020, we were focused on building a portfolio of best-in-class agricultural and horticultural products to benefit farmers and hobbyists in their hemp and cannabis growing operations. Our first product line consisted of the Debudder Lid and EDGE products. The Debudder is used to strip buds off stems for a variety of plants, including hemp and cannabis. The patented Debudder line is wholly owned and marketed by the Company through our e-commerce sites. In 2020, we expanded our online product offerings to include the Kalix and NPK product lines, which offer customers access to plant nutrient products. While our focus has shifted toward cannabis products, we continue to offer the Debudder and the plant nutrient products through our online marketing platforms.

We are actively seeking to acquire and/or license additional brands, acquire and/or establish additional manufacturing and distribution operations, and acquire growing operations in the coming periods. We also continue to seek out additional agricultural and horticultural implements to add to our product offerings through distribution agreements, licensing, and acquisition. In this aspect of our business, we look for agricultural implements, durable goods, and services that will benefit smaller growers of hemp and cannabis by making their growing operations more efficient. As we increase the depth of our vertical integration, we will utilize the products from our agricultural and horticultural implements division in our operations. This will allow us to perform first-hand verification of the efficacy of the products and testimonials on our experiences with the products we offer. We also believe the customer contact and feedback from small and mid-sized growers will provide a source of prospective acquisition targets and the cannabis industry matures and consolidates in our states of operation.

Strategy and Objectives

With our investment into PPK, PPK’s cannabis joint venture relationship with FSST, and our focus on brand aggregation, MJHI intends to take advantage of significant business development opportunities. The following business divisions are either in process, under development, or are being evaluated in an effort to assemble an enterprise covering all aspects of seed to sale operations in the cannabis and hemp-based CBD sectors.

Vertically Integrated Cannabis Operations.

Through our investment in PPK and our intention to increase the investment over time to make PPK a wholly owned subsidiary, we will operate as as a vertically integrated cannabis company encompassing grow operations, harvesting, processing, extraction, manufacturing, distribution, and ~~retail~~wholesale sales of a full line of products containing THC and CBD. In addition to the FSST joint venture, the Company also ~~recently~~ signed agreements ~~an agreement~~ with International Business Group to produce and distribute the Chronic ~~Brand~~brand of products, inWDSY ~~Oklahoma~~LLC to produce and distribute the Weedsy brand of products, and with BLIP Holdings, LLC to produce and distribute the BLVK brand of products. The ~~agreement~~ ~~includes~~agreements include a right of first refusal to offer the Chronic ~~Brand~~brand in other markets as MJHI and PPK ~~expands~~expand ~~its~~their ~~footprint~~market reach. ~~The~~Management ~~ability~~believes the toaddition ~~add~~of brands to the MJHI and PPK distribution system will serve to further increase the market reach of ~~PPK and as~~ MJHI ~~increases its investment into PPK, the MJHI market reach~~ and ~~visibility will also expand~~PPK.

We followed the Chronic brand distribution agreement with a similar arrangement to represent the WEEDSY brand in Oklahoma and we are now evaluating another brand for both investment and/or brand distribution.

As a result of our brand development efforts, we also became aware of an opportunity to acquire a commercial kitchen operation in Tulsa, Oklahoma with an additional distribution facility in Oklahoma City, Oklahoma. Working with PPK, we entered into an asset acquisition agreement with AOK Ventures, Inc. to acquire the commercial kitchen operations, including a sublease on the Oklahoma City distribution facility. The acquisition was structured with PPK acquiring the assets of AOK and with the Company providing a portion of the funding for the acquisition in exchange for a 15% increase in ownership of PPK, bringing the Company’s total ownership of PPK to 25%. The assets include exclusive distribution rights to distribute the Sublime brand of products in Oklahoma with additional opportunities to expand in other states on similar terms.

Joint Venture for Manufacturing and Distribution with Tribal Partner

FSST is one of 574 Native American Indian tribes recognized by the United States Government. The Flandreau Santee Sioux Reservation is situated on over 5,000 acres of land located along and near the Big Sioux River in Moody County, South Dakota. The reservation facilities include the Royal River Entertainment Complex, which is the only legal casino in South Dakota with 430 gaming devices, a 300-seat entertainment and conference center, a 120-room hotel, an adjacent RV park, plus a full-service restaurant, buffet, snack bar and lounge.

The Tribe has been active in tribal cannabis since 2015 and has a state-of-the-art cultivation facility through which it has resumed cannabis cultivation after the legalization of cannabis in South Dakota in November 2020. The cultivation facility currently houses about 65 strains of cannabis and the Tribe has plans to renovate an existing building to develop a lab, kitchen, packaging, and a dispensary with drive-up service. FSST also has developed a full-line of 2018 Farm Bill Compliant hemp products which it sells under its trade name “Native Nations Cannabis.”

~~Federal~~As ~~recognition~~a ofresult ~~the sovereign status~~ of ~~Native~~our ~~American~~brand ~~Indian~~development ~~tribes~~efforts, ~~under~~we ~~the~~became ~~Indian~~aware ~~Reorganization Act~~ of ~~1934~~an ~~(the~~opportunity ~~“Act”) allows~~to ~~tribes~~acquire ~~such~~a ascommercial ~~the~~kitchen ~~Flandreau~~operation ~~Santee~~in ~~Sioux~~Tulsa, ~~Tribe~~Oklahoma with toan ~~manage their~~additional ~~own~~distribution ~~affairs,~~facility ~~including~~in ~~their~~Oklahoma ~~assets~~City, ~~land, and mineral rights~~Oklahoma. ~~The~~Working ~~Act~~with ~~and~~PPK, ~~the~~we ~~ensuing~~entered ~~legislation~~into ~~were~~an ~~intended~~asset toacquisition ~~create~~agreement awith ~~sound~~AOK ~~economic~~Ventures, ~~foundation for the inhabitants of the reservations~~Inc. ~~Two~~to ofacquire the ~~main~~commercial ~~benefits~~kitchen ofoperations, ~~federal~~including ~~recognition~~a ~~are~~sublease ~~exemption from~~on ~~payment~~the ofOklahoma ~~federal~~City ~~taxes~~distribution ~~and exemption from many federal and state licensing requirements applicable to non-tribal companies~~facility. AsThe aacquisition ~~result~~was ofstructured ~~these~~with ~~advantages,~~PPK ~~many~~acquiring ~~tribes~~the ~~have~~assets ~~pursued~~of ~~business~~AOK ~~opportunities~~and inwith the ~~gaming~~Company ~~and~~providing ~~tobacco~~a ~~industries.~~portion ~~Now,~~of ~~with~~ the ~~growing~~funding ~~legalization of marijuana~~ for ~~medicinal~~the ~~and~~acquisition in ~~adult~~exchange ~~use,~~for wea ~~believe~~15% ~~marijuana~~increase ~~provides~~in aownership ~~new~~of ~~growth~~PPK, ~~area~~bringing ~~for~~the ~~tribes. FSST~~Company’s istotal ~~the~~ownership ~~first~~of ~~tribe~~PPK to ~~expand~~25% ~~into~~from the ~~marijuana~~original ~~industry~~investment of ~~in South Dakota~~10%. ~~PPK~~The ~~and~~assets ~~FSST~~acquired ~~hope~~include toexclusive ~~create~~distribution arights ~~unique~~to ~~business~~distribute ~~model that~~the ~~can~~Sublime bebrand ~~offered~~of toproducts ~~other tribal entities~~ in aOklahoma ~~coordinated~~with ~~program~~additional opportunities to ~~grow~~expand ~~the~~in ~~Native~~other ~~Nations~~states ~~brand~~on ~~throughout~~similar ~~sovereign lands~~terms.

Joint Venture for Manufacturing and Distribution with Tribal Partner

With our 25% of investment in PPK referenced above we felt the expanded explanation of PPK’s joint venture was worth noting. FSST is one of 574 Native American Indian tribes recognized by the United States Government. The Flandreau Santee Sioux Reservation is situated on over 5,000 acres of land located along and near the Big Sioux River in Moody County, South Dakota. The reservation facilities include the Royal River Entertainment Complex, which is the only legal casino in South Dakota with 430 gaming devices, a 300-seat entertainment and conference center, a 120-room hotel, an adjacent RV park, plus a full-service restaurant, buffet, snack bar and lounge.

FSST has been active in tribal cannabis since 2015 and has a state-of-the-art cultivation facility through which it has resumed cannabis cultivation after the legalization of cannabis in South Dakota in November 2020. The cultivation facility currently houses about 65 strains of cannabis and the Tribe has renovated an existing building to include a lab, kitchen, packaging, and a dispensary with drive-up service. FSST also has developed a full-line of 2018 Farm Bill Compliant hemp products which it sells under its trade name “Native Nations Cannabis.”

Federal recognition of the sovereign status of Native American Indian tribes under the Indian Reorganization Act of 1934 (the “Act”) allows tribes such as the Flandreau Santee Sioux Tribe to manage their own affairs, including their assets, land, and mineral rights. The Act and the ensuing legislation were intended to create a sound economic foundation for the inhabitants of the reservations. Two of the main benefits of federal recognition are exemption from payment of federal taxes and exemption from many federal and state licensing requirements applicable to non-tribal companies. As a result of these advantages, many tribes have pursued business opportunities in the gaming and tobacco industries. Now, with the growing legalization of marijuana for medicinal and adult use, we believe marijuana provides a new growth area for tribes. FSST is the first tribe to expand into the marijuana industry in South Dakota. PPK and FSST have created a unique business model that is now being offered to other tribal entities in a coordinated program to grow the Native Nations brand throughout sovereign lands.

PPK and its Chief Executive Officer, Clinton Pyatt, have now entered into an agreement with FSST to offer the tribal program to other tribes. In each instance where a tribe agrees to follow the FSST/PPK model, PPK will serve as the manufacturer on the tribal lands in exchange for a revenue sharing arrangement on retail sales revenues generated out of the tribal relationship. This also facilitates expansion of brand sales to new areas as ne tribal relationships are forged. MJHI is working closely with PPK to include the MJHI Brand Portfolio in the new tribal arrangements.

Indoor Grow Operations

The Company is evaluating several indoor grow operations for acquisition and/or joint venture operations but has not entered into any binding agreements or arrangements. Management believes that securing indoor grow operations ~~would~~will allow the Company’s operating divisions to access a consistent supply of biomass in the quality demanded by the Company’s customers. Management also believes that the acquisition of an existing indoor grow facility would allow the Company to rapidly generate operating cash flows as the biomass is processed by the Company’s own extraction and manufacturing concerns. As indicated above, PPK and FSST both have their own grow facilities in Oklahoma and South Dakota, respectively, which we believe positions us to apply best practices learned from our and their own operations to newly acquired locations. The Company, PPK, and FSST ~~intends~~intend to continue to evaluate indoor grow facilities in locations where they are licensed to grow or manufacture products and in new markets where licenses to cultivate and process marijuana can be obtained at reasonable cost.

The Company is cognizant of the critical processes that must be addressed to effectively monitor and produce a quality product. Steps ~~considered~~ considered critical include cultivation monitoring, maintenance and monitoring of plant ~~nutrient~~nutrients, irrigation, and lighting systems during the growing cycles, monitoring of production processes, and knowledge of the market demand for products that customers want and for which they will pay a reasonable price. Management believes all of these aspects of the business could be very efficiently driven by software applications. The Company is currently evaluating several competent software alternatives to address these critical processes and the Company expects to develop procedures and practices to obtain a competitive advantage over less sophisticated producers.

Disrupting Cannabis Distributor

Once the products are produced, the next critical phase of our strategic vision is in distribution of the products to customers where and when demanded. This is another area where management believes inventory control, data analysis to determine product demand, and delivery systems focused on getting products into the hands of the customers at the lowest delivery cost possible could be driven by software applications. The Company is currently evaluating inventory control systems, consumer data collection systems, and delivery methods to allow efficient distribution of the products to the consumer.

8Traditionally, retail distribution is done through brick-and-mortar dispensaries. With the growing reach of Lyft and Uber, and similar business models, last mile delivery is a growth industry. We believe that software applications may also be applied to this aspect of the marijuana industry, and we are evaluating solutions that could disrupt the traditional brick-and-mortar dispensary distribution model at lower cost.

Traditionally, retail distribution is done through brick-and-mortar dispensaries. With the growing reach of Lyft and Uber, and similar business models, last mile delivery is a growth industry. We believe that software applications may also be applied to this aspect of the marijuana industry and we are evaluating solutions that could disrupt the traditional brick-and-mortar dispensary distribution model at lower cost.9

Farm Implements and Nutrient Products

Our goal is to become a preferred provider of agricultural and horticultural products to hemp and marijuana growers and processors. We are targeting small and medium sized commercial growers as well as the hobby farmers prevalent in many areas with recently legalized hemp and marijuana industries. We intend to continue our expansion by building distribution relationships with manufacturers of products that fit in our catalog, and by acquiring rights to manufacture and sell compatible products when those opportunities occur. In the longer term, we intend to open physical warehouse and retail locations on the east and west coasts of the United States and eventually in a central U.S. location in order to optimize logistics for our product sales and distribution efforts. As we build our product lines, we intend to become a one-stop shop for the hemp and marijuana growers looking for ways to improve yield and reduce costs of harvest and processing.

Business Concentration.

In the period ended May 31, ~~2021~~2022, our business in the Debudder product line was concentrated with 8396% of our debudder sales going to ~~our top three~~ four customers. We expect significant changes in ~~our~~the sources of our revenues in the coming periods and the business concentrations for the period ended May 31, ~~2021~~2022, may not reflect future results.

Competition

AtWith ~~this point in~~ our ~~development,~~expansion weinto ~~believe our competitors in~~ the ~~marijuana~~vertically ~~and~~integrated ~~hemp~~cannabis ~~product~~space ~~industries~~through ~~are~~our ~~those~~investment ~~companies~~in ~~that are~~PPK, ~~acting~~we aswill ~~product~~be ~~aggregators~~subject ~~and distributors of products similar~~ to ~~ours.~~competition Tofor ~~date,~~a ~~the hemp industry (primarily relating~~wide torange ~~CBD~~of ~~oils) and the cannabis~~ industry participants, ~~have been fragmented~~ and ~~chaotic~~we ~~with~~expect ~~large~~competition ~~numbers of small and medium sized companies attempting~~ to ~~develop~~intensify ~~products and then working to gain a toehold~~ in the ~~burgeoning~~coming ~~market for those products~~periods. ~~CBD~~We ~~products~~ are currently ~~offered~~evaluating onour ~~Amazon,~~sources of ~~E-Bay,~~direct ~~and company specific web sites and the~~ competition ~~for~~in ~~consumer attention is extreme. THC product distribution is more limited and governed by~~ the ~~applicable state regulations in each state permitting sale of THC products~~California, ~~either~~ ~~for medicinal purposes or for adult use. A few larger companies such as Trulieve Cannabis Corp.~~Colorado, ~~Charlotte’s Web~~Oklahoma, and ~~Canopy~~South ~~Growth~~Dakota ~~Corp,,~~markets ~~among~~where ~~others,~~MJHI ~~have reached critical mass in terms of brand awareness~~ and ~~market~~PPK ~~reach,~~are ~~but~~currently ~~the~~operating ~~Company~~and ~~expects~~will toreport beon ~~able~~competition toexperienced ~~compete~~as ~~effectively~~we ~~with~~develop ~~these~~our ~~larger~~history ~~competitors through effective use~~ of ~~technology,~~selling ~~the~~products ~~unique aspects of tribal sovereignty, and the growing market presence~~ in ~~Oklahoma~~these ~~and South Dakota~~regions.

9In our sector of farm implements and nutrient products, the direct competition for distribution of the “picks and shovels” needed by the small growers is significantly less congested. There are some retail offshoots from brick-and-mortar businesses like hydroponics shops that offer a range of tools and implements similar to the Company’s product offerings, and these businesses are likely to compete directly with the Company’s offerings. To date we are not aware of any large nationally recognized distributors of like products, and we are attempting to position ourselves as a player at the national level through online sales. There are significant hurdles to accomplishing this objective, most significantly, availability of capital to build and maintain the online information needed for a comprehensive “one-stop-shop” offering. If we are unable to find the necessary capital to build our product lines and our online presence, we are likely to face increasing competition as other players enter the market. This could have a negative impact on our ability to grow our revenues and compete effectively in the future.

The direct competition for distribution of the “picks and shovels” needed by the small growers is significantly less congested. There are some retail offshoots from brick-and-mortar businesses like hydroponics shops that offer a range of tools and implements similar to the Company’s product offerings, and these businesses are likely to compete directly with the Company’s offerings. To date we are not aware of any large nationally recognized distributors of like products and we are attempting to position ourselves as a player at the national level. There are significant hurdles to accomplishing this objective, most significantly, availability of capital to build and maintain the online information needed for a comprehensive “one-stop-shop” offering. If we are unable to find the necessary capital to build our product lines and our online presence, we are likely to face increasing competition as other players enter the market. This could have a negative impact on our ability to grow our revenues and compete effectively in the future.10

With our expansion into the vertically integrated cannabis space through our investment in PPK, we will be subject to competition for a wider range of industry participants and we expect competition to intensify in the coming periods. We are currently evaluating our sources of direct competition in the Oklahoma and South Dakota markets where PPK is currently operating, and will report on competition experienced by PPK as we develop our history of selling products in these regions.

Competitive Advantages

We believe our competitive ~~advantage~~advantages isare derived from our ability to pursue opportunities when and where we find them without getting ~~bogged~~ bogged down in the bureaucracy that a larger and more diverse business might face. As a small publicly traded company, we are able to move quickly, rapidly negotiate and document licensing and distribution agreements, and when appropriate, acquisitions.

With the acquisition of our interest in PPK ~~(d.b.a.~~and the Country Cannabis) Brand, and our desire to increase our ownership of PPK to a majority position (up to 100%), we are also now seeking competitive advantages in ~~Oklahoma~~our market areas by expanding the brand pool available to ~~PPK~~MJHI and PPK for distribution through ~~the~~our ~~Country~~growing ~~Cannabis~~sales ~~customer base~~force. By adding brands, including Chronic, Sublime, Weedsy and ~~Weedsy~~BLVK, MJHI ~~is providing~~and PPK are ~~with~~providing additional products to offer dispensaries ~~that can be presented at the same time~~ as ~~the~~a ~~usual~~one ~~Country~~stop ~~Cannabis sales calls~~shop. ~~The~~We ~~potential~~expect ~~benefit~~that isthis will generate increased ~~orders~~order ~~per~~size per sales visit and a reduction of selling cost per product across ~~the PPK~~our entire distribution network.

Marketing and Distribution

~~Historically,~~Our ~~our~~business ~~product~~model ~~offerings~~now ~~have~~includes been limited to the debudder product line and additional soil enhancement products that we distribute for other manufacturers. We will continue to develop these capabilities as resources allow. Our primary marketing ~~method for the existing products is through our online shopping site, www.procannagro.com, and through a small number~~ of ~~distributors that offer the debudder~~ products to ~~their~~wholesale customers. Weand doactively ~~not~~seeking ~~expect~~new ~~the~~business ~~debudder~~opportunities ~~will~~for ~~be a significant contributor to revenues or profits in the foreseeable future, but we intend to continue our efforts to grow the business~~expansion.

10A significant part of our current business model involves manufacture and distribution of products to wholesale customers, consisting primarily of dispensaries. In order to effectively sell to these wholesale customers, MJHI and PPK have and are growing our sales force for each location/area, broken down primarily by each state in which we operate. This allows our sales teams to become familiar with the laws and regulations governing cannabis sales in their state of operation and allows each team to get to know the markets, customers, and demographics of the users. Our Brand Portfolio gives each dispensary the ability to tailor its orders to meet the demands of its retail customers in terms of product type, price point, and brand recognition. We believe there is value in calling on our customers and face-to-face visits, but we also maintain an online store and information site to provide customers with that avenue or shopping if desired.

~~Currently,~~In order to keep a steady stream of acquisition prospects and brands, we are ~~also~~actively ~~seeking~~searching ~~additional~~for business opportunities in the cannabis industry. Our searches are done through word of mouth, attendance at trade shows and industry ~~primarily~~events, and by ~~closely~~ monitoring ~~developments~~the inactivities ~~the~~in ~~cannabis~~our ~~space~~states of operations. When we identify an interesting prospect, our CEO reaches out personally to the management team of the prospect to see if there is a basis for furthering discussions. Our management team ~~also~~ has a long history in the industry and large networks of contacts which provide ~~word~~leads ofon ~~mouth connections to other relevant~~ business prospects. Collectively, we believe we will be able to capitalize on these various connections to build a broad-based business selling products to our customers in the ~~hemp and~~ cannabis space. In the longer term, we intend to pay close attention to other needs of our customers and to meet those needs at the appropriate time with new offerings of products and services, including offering management services, oil extraction capabilities, indoor cannabis growing facilities, manufacturing, distribution, and dispensary locations. If we can secure appropriate funding to expand our product lines, we believe the market for our products will expand.

~~Manufacturing~~Historically, our product offerings have been limited to the debudder product line and additional soil enhancement products that we distribute for other manufacturers. We will continue to develop these capabilities as resources allow. Our primary marketing method for the existing products is through our online shopping site. and through a small number of distributors that offer the debudder products to their customers. We do not expect the debudder to be a significant contributor to revenues or profits in the foreseeable future, but we intend to continue our efforts to grow the business.

We are not currently manufacturing any products in our own facilities. We rely on third party manufacturers for our production runs, and currently have relationships with third party companies for the manufacturing our products, primarily with Chinese companies. We are monitoring the China tariff situation closely and will take appropriate steps to find new contract manufacturing capabilities in other countries should the China tariffs cause a significant impact on our business. Management believes that alternative manufacturers are available, both in the United States and in other industrialized nations, but it is likely that such other sources of manufacturing would only be available at increased cost. Given current gross margins on the debudder line, an increase in costs may impact the long-term viability of the debudder product line. The molds used to manufacture our products were built by Eco Molding Co., Limited in Guandong, China. We own the molds, but it is our understanding that the molds may not be transferred out of China. Consequently, if an alternate manufacturer outside of China becomes necessary, we may be forced to incur the cost of a new mold, which could further affect the viability of the debudder product line. We do not currently have any outstanding contracts with Eco Molding for production of our product and have historically operated on the basis of purchase orders. Our last order for product was for 10,000 units of the Debudder Edge product. We received our final shipment of these units during the year and they are currently held in inventory for sale to customers. At current inventory and sales levels, we expect that another product order will be necessary within 6 months.

Our investment in PPK now also provides the Company with manufacturing capabilities for cannabis products, including pre-rolls, vape cartridges and edible products. While the Company does not manufacture products directly, we will be impacted by our financial interest in PPK and we are continuing to evaluate PPK’s manufacturing operations for the consequences of COVID-19, supply chain impacts, availability of labor, and other matters that could have short or long-term affects on PPK’s operations. To date, we have not determined that there are any outstanding issues that impact PPK’s manufacturing operations, aside from normal and recurring business considerations.

Manufacturing

Vertically Integrated Cannabis Operations. Through our agreements with Dragon Originals in Colorado and Satellite DIP LLC in California, we are now actively engaged in manufacturing, packaging and distribution of cannabis products in Cathedral City, California and in Denver Colorado through a sub operation agreement with PPK. Our close relationship with PPK has allowed us to supplement our manufacturing knowledge and experience with the expertise gained by PPK through many years of hands-on manufacturing, product development, quality control and packaging of similar products. Both the Colorado and California locations were start-ups requiring equipment set-up, training, process creation, and adjustments of manufacturing systems. Both locations are now producing high quality products for sale and our manufacturing processes continue to improve as our workforces becomes more seasoned and as our familiarity with the manufacturing equipment increases. We expect to continue building our integrated systems in conjunction with PPK and are focused on adopting best manufacturing practices where feasible.

Farm Implements and Nutrient Products. We are not currently manufacturing any products in our own facilities. We rely on third party manufacturers for our production runs, and currently have relationships with third party companies for the manufacturing our products, primarily with Chinese companies. We are monitoring the China tariff situation closely and will take appropriate steps to find new contract manufacturing capabilities in other countries should the China tariffs cause a significant impact on our business. Management believes that alternative manufacturers are available, both in the United States and in other industrialized nations, but it is likely that such other sources of manufacturing would only be available at increased cost. Given current gross margins on the debudder line, an increase in costs may impact the long-term viability of the debudder product line. The molds used to manufacture our products were built by Eco Molding Co., Limited in Guandong, China. We own the molds, but it is our understanding that the molds may not be transferred out of China. Consequently, if an alternate manufacturer outside of China becomes necessary, we may be forced to incur the cost of a new mold, which could further affect the viability of the debudder product line. We do not currently have any outstanding contracts with Eco Molding for production of our product and have historically operated on the basis of purchase orders. Our last order for product was for 10,000 units of the Debudder Edge product. We received our final shipment of these units during the year, and they are currently held in inventory for sale to customers. At current inventory and sales levels, we expect that another product order will be necessary in the latter half of 2023.

Intellectual Property

~~Currently,~~Our weintellectual ~~have~~property ~~two~~consists ~~design~~of ~~patents,~~business ~~and~~trade ~~several~~secrets ~~foreign~~regarding ~~patents~~methods ~~covering~~of ~~our debudder products. The United States Patent and Trademark Office (“USPTO”) issued our patents on October 8~~operation, ~~2019.~~product ~~Design Patent D862180 covers the original Debudder Bucket Lid~~formulations, and ~~Design Patent D862281 covers the Debudder Edge. Our~~ business ~~strategy will continue to focus on intellectual property protections when appropriate~~practices. ~~As we research additional products to include in our product catalogue, we include an analysis of~~ ~~the~~This ~~level~~category ~~of protection that~~ is ~~available~~applicable ~~for~~across ~~such~~all ~~product~~sectors ~~as an element~~ of our ~~decision~~business, tois ~~pursue~~not ~~licensing~~protected orby ~~distribution~~patent ~~of that product. Our preference is to license~~ or ~~distribute~~other ~~products that have~~ intellectual property ~~protections~~laws, ~~either~~and ~~because~~is ofheld ~~patent~~in ~~pending~~confidence orby ~~patented~~our ~~status,~~employees orby ~~as a result of trade secrets~~agreement.

We also own the domains for mjhi.com, mjharvestinc.com, and procannagro.com. We utilize mjhi.com as our primary domain, website address and e-mail server address. Procannagro.com is our online shopping site and web based sales tool. Mjharvestinc.com is being pahsed out in favor of mjhi.com, but will likely be retained to protect against confusion caused by third party use if we were to abandon the domain and it became available for others.

Government Regulation

The United States federal government regulates drugs in large part through the Controlled Substances Act, or CSA. Marijuana, which is a form of cannabis, is classified as a Schedule I controlled substance. As a Schedule I controlled substance, the federal Drug Enforcement Agency, or DEA, considers marijuana to have a high potential for abuse with no currently accepted medical use in treatment in the United States (except as disclosed below for epilepsy and related syndromes) and a lack of accepted safety for use of the drug under medical supervision. According to the U.S. federal government, cannabis having a concentration of tetrahydrocannabinol, or THC, greater than 0.3% is marijuana. Cannabis with a THC content below 0.3% is classified as hemp. The scheduling of marijuana as a Schedule I controlled substance is inconsistent with what we believe to be widely accepted medical uses for marijuana by physicians, researchers, patients, and others. Moreover, as of November 30, 2020 and despite the clear conflict with U.S. federal law, 35 states and the District of Columbia have legalized marijuana for medical use, while 15 of those states and the District of Columbia have legalized the adult-use of cannabis for recreational purposes. In November 2020, voters in Arizona, Montana, New Jersey and South Dakota voted by referendum to legalize marijuana for adult use, and voters in Mississippi and South Dakota voted to legalized marijuana for medical use. As further evidence of the growing conflict between the U.S. federal treatment of cannabis and the societal acceptance of cannabis, the FDA on June 25, 2018 approved Epidiolex. Epidiolex is an oral solution with an active ingredient derived from the cannabis plant for the treatment of seizures associated with two rare and severe forms of epilepsy, Lennox-Gastaut syndrome and Dravet syndrome, in patients two years of age and older. This is the first FDA-approved drug that contains a purified substance derived from the cannabis plant. In this case, the substance is cannabidiol, or CBD, a chemical component of marijuana that does not contain the psychoactive properties of THC.

~~Marijuana~~In ~~is largely regulated at~~ the ~~state~~farm ~~level~~implements insector, ~~the~~we ~~United~~have ~~States.~~two ~~State~~design ~~laws regulating marijuana are in conflict with the CSA~~patents, ~~which makes marijuana use~~ and ~~possession~~several ~~federally~~foreign ~~illegal.~~patents ~~Although~~covering ~~certain~~our ~~states~~debudder ~~and~~products. ~~territories~~The ~~of the~~ United States ~~authorize medical~~ ~~or adult-use marijuana~~Patent ~~production~~ and ~~distribution~~Trademark byOffice ~~licensed~~(“USPTO”) orissued ~~registered~~our ~~entities,~~patents ~~under~~on ~~United~~October ~~States federal law~~8, ~~the~~ ~~possession, use, cultivation, and transfer of marijuana and any related drug paraphernalia is illegal~~2019. ~~Although~~Design ~~our~~Patent ~~activities currently~~D862180 docovers ~~not involve any products that contain THC and we are compliant with~~ the ~~applicable~~original ~~state and local laws in states~~Debudder ~~where~~Bucket ~~we do business~~Lid, ~~should we enter into a new area that involves THC products, strict compliance with state~~ and ~~local~~Design ~~laws with~~Patent ~~respect~~D862281 tocovers ~~cannabis~~the ~~may~~Debudder ~~neither absolve us of liability under United States federal law nor provide a defense to any federal criminal action that may be brought against us~~Edge.

Our business strategy will continue to focus on intellectual property protections when appropriate. As we research additional products to include in our product catalogue, we include an analysis of the level of protection that is available for such product as an element of our decision to pursue licensing or distribution of that product. Our preference is to license or distribute products that have intellectual property protections, either because of patent pending or patented status, or as a result of trade secrets.

We also own the domains for mjhi.com, mjharvestinc.com, and procannagro.com. We utilize mjhi.com as our primary domain, website address, and e-mail server address. Procannagro.com is our online shopping site and web-based sales tool. Mjharvestinc.com is being phased out in favor of mjhi.com but will likely be retained to protect against confusion caused by third party use if we were to abandon the domain and it became available for others.

Government Regulation

The scheduling of marijuana as a Schedule I controlled substance is inconsistent with what we believe to be widely accepted medical uses for marijuana by physicians, researchers, patients, and others. Moreover, as of July 29, 2022, and despite the clear conflict with U.S. federal law, 37 states and the District of Columbia have legalized marijuana for medical use, while 19 of those states and the District of Columbia have legalized the adult-use of cannabis for recreational purposes.

As further evidence of the growing conflict between the U.S. federal treatment of cannabis and the societal acceptance of cannabis, the FDA on June 25, 2018, approved Epidiolex. Epidiolex is an oral solution with an active ingredient derived from the cannabis plant for the treatment of seizures associated with two rare and severe forms of epilepsy, Lennox-Gastaut syndrome and Dravet syndrome, in patients two years of age and older. This is the first FDA-approved drug that contains a purified substance derived from the cannabis plant. In this case, the substance is cannabidiol, or CBD, a chemical component of marijuana that does not contain the psychoactive properties of THC.

Marijuana is largely regulated at the state level in the United States. State laws regulating marijuana are in conflict with the CSA, which makes marijuana use and possession federally illegal. Although certain states and territories of the United States authorize medical or adult-use marijuana production and distribution by licensed or registered entities, under United States federal law, the possession, use, cultivation, and transfer of marijuana and any related drug paraphernalia is illegal. We are compliant with the applicable state and local laws in states where we do business, but strict compliance with state and local laws with respect to cannabis may neither absolve us of liability under United States federal law nor provide a defense to any federal criminal action that may be brought against us.

In 2013, as more and more states began to legalize medical and/or adult-use marijuana, the federal government attempted to provide clarity on the incongruity between federal law and these state-legal regulatory frameworks. Until 2018, the federal government provided guidance to federal agencies and banking institutions through a series of DOJ memoranda. The most notable of this guidance came in the form of a memorandum issued by former U.S. Deputy Attorney General James Cole on August 29, 2013, which we refer to as the Cole Memorandum.

The Cole Memorandum offered guidance to federal agencies on how to prioritize civil enforcement, criminal investigations and prosecutions regarding marijuana in all states and quickly set a standard ~~for~~with which marijuana-related businesses tomust comply ~~with~~. The Cole Memorandum put forth eight prosecution priorities:

Preventing the distribution of marijuana to minors;

Preventing revenue from the sale of marijuana from going to criminal enterprises, gangs and cartels;

Preventing the diversion of marijuana from states where it is legal under state law in some form to other states;

Preventing the state-authorized marijuana activity from being used as a cover or pretext for the trafficking of other illegal drugs or other illegal activity;

Preventing violence and the use of firearms in the cultivation and distribution of marijuana;

Preventing drugged driving and the exacerbation of other adverse public health consequences associated with marijuana use;

Preventing the growing of marijuana on public lands and the attendant public safety and environmental dangers posed by marijuana production on public lands; and

Preventing marijuana possession or use on federal property.

On January 4, 2018, former United States Attorney General Sessions rescinded the Cole Memorandum by issuing a new memorandum to all United States Attorneys, which we refer to as the Sessions Memo. Rather than establishing national enforcement priorities particular to marijuana-related crimes in jurisdictions where certain marijuana activity was legal under state law, the Sessions Memo simply rescinded the Cole Memorandum and instructed that “[i]n deciding which marijuana activities to prosecute... with the [DOJ’s] finite resources, prosecutors should follow the well-established principles that govern all federal prosecutions.” Namely, these include the seriousness of the offense, history of criminal activity, deterrent effect of prosecution, the interests of victims, and other principles.

President Biden has nominated Merrick Garland to serve as Attorney General in his administration. It is not yet known whether the Department of Justice under President Biden and Attorney General Garland will re-adopt the Cole Memorandum or announce a substantive marijuana enforcement policy.14

Merrick Garland was confirmed to serve as Attorney General in the Biden administration. US Attorney General Merrick Garland currently has no plans to reinstate the Cole Memo or pass new legislation.

Garland stated in April 2022 that cannabis prosecutions are “not an efficient use of resources given the opioid and methamphetamine epidemic that we have,” indicating that the Biden Administration has no intention of repealing Sessions’ memo. While he has made it increasingly clear that he and his administration have no plans of federally prosecuting cannabis users, decriminalization has come to a stagnant point in federal policy, although efforts at federal legalization continue.

While the Cole Memorandum will be informally adhered to and treated as precedence, there are no confirmed efforts to recodify the DOJ’s official legal stance on cannabis law. Both Republicans and Democrats are currently pushing for comprehensive federal reform. Bipartisan congressional groups have even put forth a bill aiming to amend current legislation and model cannabis regulation after existing alcohol regulations.

Nonetheless, there is no guarantee that state laws legalizing and regulating the sale and use of marijuana will not be repealed or overturned, or that local governmental authorities will not limit the applicability of state laws within their respective jurisdictions. Unless and until the United States Congress amends the CSA with respect to marijuana (and as to the timing or scope of any such potential amendments there can be no assurance), there is a risk that federal authorities may enforce current U.S. federal law. Currently, in the absence of uniform federal guidance, as had been established by the Cole memorandum, enforcement priorities are determined by respective United States Attorneys.

We are not aware of other specific governmental regulations that impact our business. We do, however, utilize Chinese vendors for manufacturing a significant portion of the products we sell. To the extent that tariffs are imposed on imported goods manufactured in China, our pricing structure and acceptance in the marketplace may be affected. We currently stock our products through distributors in foreign countries when appropriate and ship direct from our manufacturer to the foreign distributor when such can be done at a cost savings. We intend to continue to explore ways that we can hold our costs down on the products we sell in order to minimize price sensitivity concerns with our customers.

Environmental Laws

We are not aware of any environmental laws that would limit our ability to conduct our current sales and distribution activities in their present form. As we expand our operations to participate more directly in the cannabis and hemp industries, and become a vertically integrated grower, harvester, processor, manufacturer, and distributor of cannabis and hemp products, we will likely be subject to environmental laws, including water usage, recycling, waste disposal, and similar regulations that will vary depending on the location of our facilities. We intend to address the impact of such environmental regulations when we have a specific use case to evaluate.

Organization Within Last Five Years

We were originally incorporated under the name HealthGuard International Marketing Corporation, in the State of Nevada on August 15, 2002. At the time we operated under the name HealthGuard International Marketing Corporation, no business was conducted. In 2003, the Company entered into a reverse takeover transaction with a Japanese Investment Group engaged in the business of gaming. After completing the reverse takeover, the Japanese Investment Group failed to implement its business plan and ceased having any contact with the shareholders of the Company. As a result, the Company was dormant until June 27, 2011, when Jerry Cornwell, our president and one of our Directors, took legal action to obtain the appointment of a custodian to regain control over the Company. On August 15, 2011, the Company held a meeting, with the custodian acting on behalf of the Japanese shareholders and approved a private offering of a control block of stock to a new investor. On September 18, 2011 the District Court of Clark County, Nevada entered an order cancelling all of the shares issued to the Japanese Investment Group. The result of this action was to cede control of the Company to the new investor. In late September, the Company undertook a one-for-ten reverse stock split of its total shares outstanding, reorganized the Company under the name EM Energy, Inc., and began seeking oil and gas properties for development.

In late 2017, the Board reevaluated the oil and gas development efforts and elected to reorganize again to focus on distribution of agricultural and horticultural implements used by farmers and hobbyists around the world. The Company acquired the rights to the DeBudder product line, including the DeBudder Bucket Lid and the DeBudder Edge, and continues to seek other products for distribution through its distributor relationship and its distribution web site located at www.procannagro.com. In 2018, the Company changed its name to MJ Harvest, Inc. and amended and restated its articles of incorporation to reflect the reorganized business direction. The Company also changed its stock symbol to MJHI (formerly RZPK).

These changes were affected in order to make our corporate name and ticker symbol better align with our short-term and long-term business focus. Our current, short-term goals will focus on building our product portfolio while we expand our product sales and build our distribution platform and brand under the www.procannagro.com website.

Our long-term plan is to increase our ownership position in PPK and to concurrently acquire one or more cannabis extraction facilities and grow operations where we can develop additional products, build or brands, research the effectiveness of such products in real world settings, and provide concrete examples of the effectiveness of the products to our customers. This step will also allow us to expand operations into biomass production, processing, and sale of products containing THC and CBD. We can offer no assurances that we will be able to accomplish any portion of our long-range vision.

General Development of our Business

Our long-term plan is to increase our ownership position in PPK, grow our cannabis manufacturing and distribution businesses in Colorado and California, and acquire additional cannabis extraction, manufacturing and distribution facilities and grow operations where we can develop additional products, build our brands, research the effectiveness of such products in real world settings, and provide concrete examples of the effectiveness of the products to our customers. This step will also allow us to expand operations into biomass production, processing, and sale of products containing THC and CBD.

We also intend to focus on expansion of our cannabis operations into new states and regions through our relationship with PPK and PPK’s ability to expand through tribal relationships under the auspices of FSST.

We can offer no assurances that we will be able to accomplish any portion of our long-range vision.

Employees

AsPrior to ofthe ~~September~~Colorado ~~10,~~and ~~2021~~California acquisitions, weall ~~have no employees. All~~ of our ~~activities~~day-to-day ~~are~~tasks were outsourced to consultants and independent contractors who provided ~~provide~~ services to us as needed and as directed by our Chief Executive Officer. ~~Day~~With tothe ~~day~~Colorado ~~operations~~and ~~are~~California ~~managed~~acquisitions, byas ~~our~~of September ~~Chief~~23, ~~Executive~~2022, ~~Officer~~we ~~and~~have ~~our~~fifteen ~~Chief~~total ~~Financial~~employees ~~Officer~~of whom are full-time, and ~~their activities~~all ~~are~~of ~~monitored~~whom bywork in our ~~Board~~California facility. We have outsourced operations of ~~Directors.~~our AsColorado ~~business~~location ~~activities~~to ~~require~~PPK and ~~capital~~PPK ~~resources~~employs ~~permit,~~five weworkers ~~intend~~at tothat ~~hire~~location. ~~employees to~~We ~~fulfill~~also ~~our~~have ~~company’s~~five ~~needs~~contractors regularly providing services to the Company.

Day to day operations are managed by our Chief Executive Officer and our Chief Financial Officer, and their activities are monitored by our Board of Directors. As business activities require and capital resources permit, we intend to hire employees to fulfill our Company’s needs.

Facilities

The Company ~~does~~has ~~not~~manufacturing ~~currently~~facilities ~~have~~located ~~any~~at ~~physical~~4093 ~~facilities.~~Jackson ~~Each~~Street, ofDenver, ~~our~~CO ~~officers~~80216 and, ~~directors~~as ~~operate~~of ~~out~~July of2022, ~~home~~68350 orCommercial ~~virtual~~Road, ~~offices~~Cathedral ~~and~~City, weCA ~~are~~92234. ~~able~~Both tolocations ~~meet~~are ~~remotely~~leased asand ~~needed.~~are ~~Our~~considered ~~physical~~adequate ~~products~~for ~~are~~the ~~placed~~commercial atmanufacturing ~~third-party~~operations ~~fulfillment~~conducted ~~centers~~there. ~~and are shipped~~Neither ~~direct~~location tohas ~~our~~equipment ~~customers~~that byis ~~the~~owned ~~fulfillment~~or ~~centers.~~leased Weby ~~expect~~us that ~~physical~~is ~~space~~material ~~will~~to ~~not~~our bemanufacturing ~~required~~operations ~~until~~as weof ~~experience~~yearend. ~~additional~~We do not maintain ~~growth~~any ~~and~~principal ~~our~~executive ~~needs~~offices for ~~inventory~~the ~~storage expand~~Company.

In addition, each of our officers and directors and regularly retained contractors operate out of home or virtual offices. We are able to meet remotely as needed. In our farm implement and plant nutrients business segment, our physical products are placed at third-party fulfillment centers and are shipped direct to our customers by the fulfillment centers or drop shipped directly from the manufactures of the products we distribute.

COVID-19

InThe ~~March~~effects ~~2020,~~of ~~COVID-19~~the ~~was~~continued ~~declared~~outbreak aof ~~pandemic~~COVID-19 byand ~~the~~related ~~World~~government ~~Health~~responses ~~Organization~~have and ~~the~~could ~~Centers~~include ~~for~~extended ~~Disease~~disruptions ~~Control~~to ~~and Prevention.~~supply ~~Its~~chains ~~rapid spread around the world~~ and ~~throughout~~capital ~~the United States prompted many countries~~markets, ~~including~~reduced ~~the~~labor ~~United~~availability ~~States,~~and toa ~~institute restrictions~~prolonged onreduction ~~travel,~~in ~~public~~economic ~~gatherings and certain business operations~~activity. These ~~restrictions~~effects ~~significantly~~could ~~disrupted~~have ~~economic~~a variety ~~activity~~of inadverse impacts to the ~~United~~Company, ~~States~~including ~~and~~our ~~Worldwide~~ability to operate. As of ~~May~~September 3123, ~~2020~~2022, ~~and~~there ~~through~~were ~~the~~no ~~date~~material ofadverse ~~filing of this Form 10-K, the disruption~~impacts ~~did~~to ~~not~~our ~~materially~~operations ~~impact~~due ~~the~~to ~~Company’s financial statements~~COVID-19.

The economic ~~effects~~disruptions ofcaused ~~the~~by ~~continued outbreak of~~ COVID-19 ~~and~~ ~~related government responses~~ could ~~include~~also ~~extended~~adversely ~~disruptions~~impact tothe ~~supply~~impairment ~~chains~~risks ~~and~~for ~~capital~~certain ~~markets,~~long-lived ~~reduced~~assets. ~~labor~~Management ~~availability and~~evaluated athese ~~prolonged~~impairment ~~reduction~~considerations inand ~~economic~~determined ~~activity.~~that ~~These~~no ~~effects~~such ~~could~~impairments ~~have~~occurred aas ~~variety~~ of ~~adverse~~May ~~impacts to the Company~~31, ~~including our ability to operate~~2022. ~~As of September 10, 2021, there were no material adverse impacts to the Registrants’ operations due to COVID-19.~~

The economic disruptions caused by COVID-19 could also adversely impact the impairment risks for certain long-lived assets. Management evaluated these impairment considerations and determined that no such impairments occurred as of May 31, 2021.

Item 1A. Risk Factors

As a smaller reporting company, we have elected not to provide the information required by this item.

Item 1B. Unresolved Staff Comments.

None

Item 2. Properties

~~The~~We ~~Company~~currently ~~neither~~lease ~~owns~~two ~~nor~~properties ~~holds~~for ~~any~~manufacturing ~~interest~~our products. One in ~~any~~Denver, ~~material~~Colorado. ~~properties~~and ~~requiring~~the ~~disclosure~~other ~~under~~in ~~this~~Cathedral ~~item~~City, California. We believe these facilities are in good condition and are suitable for the conduct of our business.

Item 3. Legal Proceedings.

WeThe ~~are~~Company ~~not~~and aPPK ~~party~~are toplaintiffs in ~~any~~lawsuit ~~material~~against ~~legal~~Country ~~proceedings~~Cannabis, ~~and~~LLC of Yale, toOklahoma for ~~the~~trademark ~~best~~infringement for the use of ~~our~~the ~~knowledge~~name “Country Cannabis”. The lawsuit was filed with the Payne County, noOklahoma ~~such~~Courts on February 7, 2022. The Company has motioned the Court for summary judgment in this matter and for legal ~~proceedings~~fees. ~~have~~The ~~been~~motion ~~threatened~~for summary ~~against~~judgement usis currently pending before the Court.

Item 4. Mine Safety Disclosures.

Not Applicable.

Part II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Our common stock ~~began~~was ~~trading~~quoted on ~~the~~ OTCQB ~~market~~beginning on February 20, 2020, under the symbol “MJHI.” Previously, the Company’s common stock ~~traded~~was quoted on ~~the~~ OTC Pink ~~market~~.

Holders of Record

On September 1023, ~~2021~~2022, there were ~~124~~44,854,737 ~~holders~~shares of ~~record of our~~ common stock held by 128 holders of record, as reported by the Company’s transfer agent. InCertain ~~computing~~shares ~~the~~are ~~number~~held ofin ~~holders~~“nominee” ofor ~~record,~~“street” ~~each~~name ~~broker-dealer~~ and ~~clearing~~accordingly, ~~corporation~~the ~~holding~~number ~~shares~~of onbeneficial ~~behalf~~ owners of ~~its~~such ~~customers~~shares is ~~counted~~not asknown aor ~~single~~included ~~stockholder.~~in ~~Counting non-objecting beneficial owners,~~ the ~~Company~~foregoing ~~has approximately 158 shareholders~~number.

No Dividends

No dividends have ever been paid on our securities, and we have no current plans to pay dividends in the foreseeable future.

Equity Compensation Plan

We did not have an equity compensation plan at May 31, ~~2021~~2022.

Transfer Agent

Pacific Stock Transfer Co., Inc., 6725 Via Austi Parkway, Las Vegas, NV 89119, telephone (702)-361-3033, serves as the transfer agent and registrar for our common stock.

Recent Sales of Unregistered Securities

The following tables include all unregistered sales of securities for the fiscal years ending May 31, 2021 and 2020, respectively.

Year Ended May 31, 2021	Shares issued for Services & Other
	Shares			Value
Related Parties
David Tobias, Director		106,974		$	40,000
Jerry Cornwell, Director		106,974			40,000
Brad Herr, CFO		160,462			60,000
Total for related parties		374,410			140,000
Unrelated Parties
Services and Other		614,838			218,244
Investment in PPK		1,520,000			972,800
Financing fee		1,200,000			1,800,000
Cancellation		(1,300,000	)		(336,875	)
Aggregate Totals May 31, 2021		2,409,248		$	2,794,169

Year Ended May 31, 2020
Shares Issued for Stock Payable	Shares		Value
Related Parties		300,000	$	75,000
Unrelated Parties		208,500		52,125
Total Shares for Stock Payable		508,500		127,125
Related Parties Services
Patrick Bilton, CEO and Director		1,080,001		413,000
David Tobias, Director		120,000		41,000
Jerry Cornwell, Director		120,000		41,000
Brad Herr, CFO		240,000		93,000
Total for Related Parties		1,560,001		588,000
Unrelated Parties
Services		665,634		256,176
Acquisitions		1,400,000		1,008,000
Aggregate Totals May 31, 2020		4,134,135	$	1,979,301

All issuances were made in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended (the “Act”). To make that determination on the availability of Section 4(a)(2) of the Act, we relied on the representations of the purchasers contained in the consulting agreements signed by the purchasers and the fact the consultants, although not employed by the Company, were familiar with the company, its operations and its management. The shares received were restricted securities.

Recent Sales of Unregistered Securities

There were no unreported sales of registered securities for the last fiscal year.

Special Sales Practice Requirements with Regard to “Penny Stocks”

To protect investors from patterns of fraud and abuse that have occurred in the market for low priced securities commonly referred to as “penny stocks,” the SEC has adopted regulations that generally define a “penny stock” to be any equity security having 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 stock is subject to the “penny stock” regulations during periods in which the price is below $5.00 per share. During any such periods, broker-dealers selling our common stock are subject to additional sales practices when they sell our stock to persons other than established clients and “accredited investors.” For transactions covered by these rules, before the transaction is executed, the broker-dealer must make a special customer suitability determination, receive the purchaser’s written consent to the transaction and deliver a risk disclosure document relating to the penny stock market. The broker-dealer must also disclose the commission payable to both the broker-dealer and the registered representative taking the order, current quotations for the securities and, if applicable, the fact that the broker-dealer is the sole market maker and the broker-dealer’s presumed control over the market. Monthly statements must be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. Such “penny stock” rules may restrict trading in our common stock and may deter broker-dealers from effecting transactions in our common stock.

Item 6. [Reserved]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Certain statements in this Report constitute “forward-looking statements.” Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that might cause such a difference include, among others, uncertainties relating to general economic and business conditions; industry trends; changes in demand for our products and services; uncertainties relating to customer plans and commitments and the timing of orders received from customers; announcements or changes in our pricing policies or that of our competitors; unanticipated delays in the development, market acceptance or installation of our products and services; changes in government regulations; availability of management and other key personnel; availability, terms and deployment of capital; relationships with third-party equipment suppliers; and worldwide political stability and economic growth. The words “believe,” “expect,” “anticipate,” “intend” and “plan” and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.

Year Ended May 31, 2022 compared with the Year Ended May 31, 2021

~~Year~~The ~~Ended~~narrative comparison of results of operations for the years ended May 31, 2022 and 2021 ~~compared~~is ~~with~~based on the ~~Year~~following ~~Ended~~table. ~~May~~The 31table includes information on continuing operations, ~~2020~~non-operating expenses and discontinued operations, which are discussed below.

The narrative comparison of results of operations for the years ended May 31, 2021 2020 is based on the following table. The table includes information on continuing operations. Discontinued operations are set out separately.

	Year Ended
	A			B			A-B
	May 31, 2022			May 31, 2021			Change			Change %
REVENUE	$	172,825		$	89,186		$	83,639			94	%
Cost of revenues		185,852			40,454			145,398			359	%
Cost of sales % of total sales		108	%		45	%		62	%
Gross profit (loss)		(13,027	)		48,732			(61,759	)		-127	%
Gross profit % of sales		-8	%		55	%		-62	%
OPERATING EXPENSES
Officer and director compensation		663,800			535,000			128,800			24	%
General and administrative		677,677			107,546			570,131			530	%
Professional fees and contract services		515,792			430,656			85,136			20	%
Total operating expenses		1,857,269			1,073,202			784,067			73	%
NET LOSS FROM CONTINUING OPERATIONS		(1,870,296	)		(1,024,470	)		(845,826	)		83	%
NON-OPERATING EXPENSES
Interest expense		777,732			378,442			399,290			106	%
Financing fees		227,756			2,906,000			(2,678,244	)		-92	%
Impairment of investment		—			592,800			(592,800	)		-100	%
Total non-operating expenses		1,005,488			3,877,242			(2,871,754	)		-74	%
LOSS FROM DISCONTINUED OPERATIONS		—			14,151			(14,151	)		-100	%
NET LOSS		(2,875,784	)		(4,915,863	)		(2,040,079	)		41	%

	Year Ended
	A			B			A-B
	May 31, 2021			May 31, 2020			Change			Change %
REVENUE	$	89,186		$	129,975		$	(40,789	)		-31	%
Cost of revenues		40,454			17,585			22,869			130	%
Cost of sales % of total sales		45	%		14	%		32	%
Gross profit		48,732			112,390			(63,658	)		-57	%
Gross profit % of sales		55	%		86	%		-32	%
OPERATING EXPENSES
Officer and director compensation		535,000			708,000			(173,000	)		-24	%
General and administrative		107,546			84,779			22,767			27	%
Impairment of intangible assets		—			758,000			(758,000	)		-100	%
Professional fees and contract services		430,656			531,125			(100,469	)		-19	%
Total operating expenses		1,073,202			2,081,904			(1,008,702	)		-48	%
NET LOSS FROM CONTINUING OPERATIONS		(1,024,470	)		(1,969,514	)		945,044			-48	%

Revenues in the year ended May 31, 2022 increased when compared to the same period in 2021. The increase is largely attributable to an intensified sales effort for Debudder products in conjunction with a move of our inventory to a new fulfillment center in California. In anticipation of the move, our sales force reached out to customers with incentives to avoid having to move the inventory and the incentive program was successful in generating a short-term increase in Debudder sales. We do not anticipate that the short-term increase in Debudder sales will be sustainable, and we expect to see a decrease in sales of farm implements and plant nutrients in the fiscal year ended May 31, 2023. In the current fiscal year, the Company also generated $25,352 in sales of cannabis products at our Colorado facility. The Colorado facility was newly opened in our fiscal fourth quarter and was in the very early stage of commencing sales activities. We expect a slow ramp up of sales of cannabis products through the remainder of calendar year 2022. Additional information on our operations is included below.

~~Revenues~~Cost ~~from~~of ~~debudder~~revenues as a percentage of sales increased in the year ended May 31, ~~2021~~2022, ~~decreased~~ when compared towith the same period in ~~2020~~2021. The ~~decrease~~ increase is ~~largely~~ attributable to ~~general~~the ~~economic~~costs ~~conditions~~incurred ~~affecting~~in ~~the~~our ~~small~~Colorado and ~~hobby~~California ~~farm~~operations. ~~customers~~In ~~that~~our ~~comprise~~fiscal ~~the~~fourth ~~bulk~~quarter, we incurred operating costs associated with setting up and documenting our manufacturing processes and producing test batches of ~~the~~products ~~Company’s~~to verify our systems ~~sales~~were generating expected results at our Colorado and California facilities. ADuring ~~portion~~this phase, we did not produce significant quantities of product for resale. The production expenses of the ~~current~~test ~~fiscal~~batches ~~year~~were, ~~was~~however, ~~also~~recorded ~~spent~~as ~~focusing~~manufacturing costs. We expect margins to improve on our ~~discontinued~~cannabis ~~operations~~product ~~and~~lines ~~that~~in ~~focus~~the ~~diverted~~coming ~~attention from~~periods as our ~~debudder~~manufacturing ~~product~~processes ~~line~~are standardized and ~~contributed~~our need to ~~the~~run ~~sales~~test batches ~~decline~~and adjust processes decreases.

Cost of revenues as a percentage of sales increased in the year ended May 31, 2021 when compared to the same period in 2020. The increase is attributable to the use of fulfillment centers for processing and shipping orders and storing inventory in all of 2021, compared to a partial year use of fulfillment centers in 2020. Management determined that fulfillment centers were a more efficient means of meeting customer demand than setting up our own order processing, packaging and shipping department due to the relatively low volume of products sold and the initial costs to establish these in house capabilities.

Other operating expenses decreased in the year ended May 31, 2021 compared to the same period in the prior year. The decrease was primarily due to the decrease in impairment of intangible assets in 2021 compared to 2020, and more modest decreases in officer and director compensation and professional fees and contract services.

Net loss from operations decreased in 2021 compared with 2020. The decrease in the net loss is attributable to the factors identified above.

Other operating expenses increased in the year ended May 31, 2022, compared with the same period in the prior year. The increase was primarily due to an increase in officer and director compensation resulting from expansion of our board of directors and contracting with Randy Lanier, a new director, to represent the Company as Brand Ambassador. We also incurred significant promotion and advertising costs during the current year, primarily for investor relations services. General and administrative expenses increased due to our decision to further develop our cannabis business through acquisition of the Colorado and California facilities and the attendant costs of setting up geographically disbursed manufacturing operations.

Net loss from operations increased in 2022 compared with 2021. The increase in the net loss is attributable to the factors identified above.

Non-operating Expenses.

InNon-operating expenses ~~connection~~decreased ~~with~~in a2022 ~~notes~~compared ~~payable~~with ~~funding~~2021. ~~transaction that~~In ~~closed on March 22,~~ 2021, ~~the~~we ~~Company~~incurred ~~paid~~ $32,~~683~~906,000 in ~~commitment~~financing ~~fees~~costs onassociate ~~the~~with ~~notes~~a indebt ~~the~~financing for ~~form~~operating ofcapital. ~~1,200,000~~The ~~shares~~notes ofpayable ~~common~~giving ~~stock and~~rise ~~3,000,000 warrants~~ to ~~purchase~~the ~~shares~~financing ~~exercisable~~fees atwere ~~$0.38~~paid ~~per~~off ~~share~~in ~~with a three-year term ending~~ March ~~22, 2024~~2022. ~~These~~Financing ~~amounts~~fees ~~are~~incurred in ~~classified~~the asyear ~~non-operating~~ended ~~expenses.~~May ~~The~~31, ~~commitment~~2022 ~~fee shares~~ were ~~valued at~~ $1227,~~800,000~~756. ~~The~~Interest ~~warrants~~expense ~~were~~increased ~~valued~~due atto ~~$1,883,000~~notes ~~using the~~payable ~~Black-Scholes~~being ~~method~~outstanding .for ~~One half of~~ the ~~warrants~~entire ~~may~~fiscal year beas ~~redeemed~~opposed ~~for~~to anthree ~~aggregate~~months ~~payment~~in ~~of $1.00 by~~ the ~~Company~~year ifended ~~the~~May ~~notes payable are paid in full before September 22~~31, 2021.

~~The~~In the ~~debt~~year ~~investment~~ended ~~also~~May ~~resulted~~31, ~~in recording $378~~2021,~~442 in~~ ~~interest~~we ~~expense~~also inincurred ~~2021~~a ~~compared with~~ $2592,~~976~~800 inimpairment ~~2020~~on ~~and~~our ~~$2,906,000~~investment in ~~financing~~PPK. ~~fees~~There ~~expense~~was inno ~~2021~~impairment ~~compared~~of tothis ~~none~~ investment in ~~2020~~the current year.

In addition, the Company subsequently invested $1,000,000 in PPK Investment Group, Inc. (doing business as Country Cannabis), a vertically integrated Oklahoma cannabis company. The investment included $620,000 from conversion of a convertible note and 1,520,000 shares of common stock valued for purposes of the acquisition at $380,000. On May 19, 2021, the closing date of the investment, the common stock closed on the OTCQB market at $0.64. The resulting value of the stock portion of the investment of $972,800. Management had determined that the fair value of the investment on May 19, 2021 was the negotiated price of $380,000 and an immediate impairment on the investment in the amount of $592,800 was recorded to reflect a carrying value of this portion of the investment of $380,000 and an aggregate investment of $1,000,000.

Discontinued Operations.

~~After operating the soils division that was acquired~~In ~~from Elevated Ag Solutions, Inc. (“Elevated”) in~~ the year ended May 31, ~~2020~~2021, ~~for~~ the ~~three~~Company ~~months~~incurred ~~ended~~a ~~August 31~~$14,151 ~~2020, management~~loss ~~undertook~~on andiscontinued ~~in-depth~~operations ~~assessment~~ of ~~the~~a business and concluded that the soils division was not as represented at the time of the acquisition, was not likely to ever operate profitably without significant revisions to operating methods and changes in personnel and was likely to create significant business questions and concerns should it be continued. Accordingly, management elected to discontinue the business acquired from Elevated. ~~Upon~~Ag ~~discontinuation of the Elevated business~~Solutions, ~~the Company entered into a settlement and unwinding~~ ~~agreement with Elevated and returned all assets acquired in the transaction to Elevated~~Inc. ~~Common stock issued~~ in ~~the acquisition, aggregating 1,300,000 shares out of 1,400,000 shares originally issued, were cancelled, and the Company paid a $10,000 walk-away fee~~2020. ~~In the aggregate, the Company recognized a loss from discontinued operations of $14,151 in the year ended May 31, 2021.~~

OPERATING RESULTS
	Year Ended
	May 31, 2021
Revenue	$	75,217
Cost of revenue		66,243
Amortization		13,125
Gross profit		(4,151	)
Loss on discontinued operations		10,000
	$	(14,151	)

~~The~~In the ~~Elevated~~year ~~operating~~ended ~~results~~May ~~for~~31, 2022, the Company expanded its operations to focus on farm implements and plant nutrients and cannabis manufacturing. In the year ended May 31, 2021, ~~compared~~the toCompany ~~2020~~operated ~~are~~only the ~~reflected~~farm inimplements ~~the~~and ~~following~~plant ~~table~~nutrients business.

OPERATING RESULTS


Year Ended May 31, 2022	Debudder Products		Cannabis Manufacturing			Total
Gross revenues	$	147,473	$	25,352		$	172,825
Cost of goods sold		60,868		124,984			185,852
Gross profit (loss)	$	86,605	$	(99,632	)	$	(13,027	)

Capital expenditures.	$	—	$	30,838		$	30,838

	Year Ended May 31, 2021			Year Ended May 31, 2020
Revenue	$	75,217		$	197,916
Cost of revenue	$	66,243			192,077
Amortization	$	13,125			—
Gross profit		(4,151	)		5,839
Loss on discontinued operations		10,000			—
	$	(14,151	)	$	5,839

Liquidity and Capital Resources

Cash flow used in operating activities for the year ended May 31, ~~2021~~2022, was $~~538~~726,~~024~~932 compared with $~~271~~258,~~527~~024 in ~~2020~~2021. During the period, our total cash ~~increased~~decreased by $9082,~~976~~432. Cash to fund the negative cash flow from operations was derived primarily from proceeds of ~~advances~~notes ~~from~~payable of ~~related parties totaling~~ $~~488~~1,~~000~~271, ~~and a net of $777,~~000 ~~from the notes payable~~. The ~~increase~~decrease in our cash position at May 31, ~~2021~~2022, is largely attributable to the ~~debt~~cash ~~financing~~requirements ~~entered into~~for onstarting ~~March~~up ~~22,~~operations in ~~2021~~Colorado and California.

Our historic operations have not been sufficient to support the existing infrastructure, much of which is required in order to maintain public company status. On March, 2229, ~~2021~~2022, we entered into a senior debt funding transaction ~~and~~that ~~made~~allowed aus ~~loan~~ to anpay ~~operating~~off ~~cannabis~~an ~~company~~earlier ~~as described in more detail below. The~~ debt ~~funding transaction~~financing and ~~the~~provided loan are steps in the targeted acquisition of the operating company PPK, and we expect that the eventual acquisition of PPK will improve our ability to support the infrastructure costs of maintaining our public company status. We also continue to seek out potential acquisition candidates with a focus on acquiring additional operating ~~companies~~capital ~~with~~primarily ~~scale~~for ~~sufficient~~start-up ~~to support all aspects of the Company’s~~ operations, including the public company infrastructure. The Company is currently heavily dependent on funding through advances from related parties, but no assurances can be given that such funding will continue to be available in ~~future periods~~California. The debt funding matures on September 22, 2021 but may be extended for six months at an increased interest rate of 15% per annum. At this time, the Company anticipates that it will extend the notes through March 22, 2022.

We ~~have~~continue ~~maintained~~to ~~active~~seek ~~operations~~out aspotential acquisition candidates with a ~~manufacturer~~focus ~~and~~on ~~distributor~~acquiring additional operating companies with scale sufficient to support all aspects of the ~~debudder~~Company’s ~~product~~operations, ~~line~~including ~~since~~the ~~2018~~public company infrastructure. WeThe doCompany ~~not~~is ~~consider~~currently heavily ~~the~~dependent ~~Company~~on tofunding bethrough aadvances ~~shell~~from ~~company~~related asparties, but no assurances can be given that ~~term~~such isfunding ~~defined~~will continue to be available in future periods. The debt funding matures on May 11, 2023at which time, the ~~Securities~~principal ~~Act~~balance of ~~1933~~the note of $2,317,198 asplus ~~amended~~accrued interest will be due.

~~The~~We ~~accompanying consolidated financial statements~~ have ~~been~~maintained ~~prepared~~active ~~assuming~~operations ~~that the Company will continue~~ as a ~~going~~manufacturer ~~concern, which contemplates the realization of assets~~ and ~~the~~distributor ~~liquidation~~ of ~~liabilities in~~ the ~~normal~~Debudder ~~course~~product ofline ~~business. We~~since ~~incurred net losses of $4,915,863 for the year ended May 31, 2021and had an accumulated deficit of $9,098,257 as of May 31, 2021~~2018. ~~These factors~~ ~~raise~~We ~~substantial~~do ~~doubt~~not ~~about~~consider the Company~~’s ability~~ to ~~continue~~be as a ~~going~~shell ~~concern. The~~company ~~Company~~as ~~may~~that ~~seek~~term ~~to raise~~is ~~money~~defined ~~for~~in ~~working~~the ~~capital~~Securities ~~purposes~~Act ~~through a public offering~~ of ~~its~~1933, ~~equity~~as ~~capital or through a private placement of equity capital or convertible debt~~amended. It will be important for the Company to succeed in its efforts to raise capital in this manner to further its business plan in an aggressive manner. Raising additional capital may cause dilution to current shareholders.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. We incurred net losses of $2,875,784 for the year ended May 31, 2022, and had an accumulated deficit of $11,974,041 as of May 31, 2022. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company may seek to raise money for working capital purposes through a public offering of its equity capital or through a private placement of equity capital or convertible debt. It will be important for the Company to succeed in its efforts to raise capital in this manner to further its business plan in an aggressive manner. Raising additional capital may cause dilution to current shareholders.

Off Balance Sheet Arrangements

None

Item 7A. Quantitative and Qualitative Disclosure About Market Risk

As a smaller reporting company, we have elected not to provide the information required by this item.

Item 8. Financial Statements

The following financial statements are being filed with this report and are located immediately following the signature page.

Financial Statements, May 31, ~~2021~~2022 and ~~2020~~ 2021

●· Report of Independent Registered Public Accounting Firm

●· Consolidated Balance Sheets, May 31, ~~2021~~2022 and ~~2020~~2021

●· Consolidated Statements of Operations for the Years Ended May 31, ~~2021~~2022 and ~~2020~~2021

●· Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the Years Ended May 31, ~~2021~~2022 and ~~2020~~2021

●· Consolidated Statements of Cash Flows for the years ended May 31, ~~2021~~2022 and ~~2020~~2021

●· Notes to the Consolidated Financial Statements

Item 9. Changes in and Disagreements with Accountants on Accounts and Financial Disclosure

~~None~~No disagreement or reportable event requiring disclosure under this item has occurred.

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

An evaluation was performed under the supervision and with the participation of management, including the CEO and CFO, of the effectiveness of the design and operation of our disclosure controls and procedures as required by Exchange Act Rules 13a-15(e) ~~and 15(d)-15(e)~~ as of the end of the reporting period covered by this report. Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures, including controls and procedures designed to ensure that information required to be disclosed by us is accumulated and communicated to our management (including our CEO and CFO), were ~~effective~~ineffective as of May 31, ~~2021~~2022, and that material information required to be disclosed in this report has been properly recorded, processed, summarized and reported in a timely manner. In making this determination, we reviewed the material weaknesses in internal control over financial reporting and concluded that the direct involvement of the CFO in all aspects of financial reporting addressed this concern.

Management Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control system has been designed to provide reasonable assurance to our management and Board of Directors regarding the preparation and fair presentation of our published financial statements.

All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Management of the Company has assessed the effectiveness of our internal control over financial reporting as of May 31, ~~2021~~2022. To make this assessment, we used the criteria for effective internal control over financial reporting described in Internal Control-Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

As a result of our assessment, we concluded that we have material weaknesses in our internal control over financial reporting as of May 31, ~~2021~~2022. We identified material weaknesses resulting from a lack of segregation of duties, and management override of controls.

We plan to address the material weaknesses identified by adding additional accounting personnel and functions, and by designing additional controls over the documentation and application of technical accounting guidance to our business. We are also reviewing our practices to limit management’s ability to override controls.

Because these material weaknesses exist, management has concluded that our internal control over financial reporting as of May 31, ~~2021is~~ 2022, is ineffective.

Changes in Internal Controls

There was no change in our internal control over financial reporting during the quarter ended May 31, ~~2021~~2022, that has materially affected, or or is reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information

None.

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

Part III

Item 10. Directors, Executive Officers and Corporate Governance

Directors and Executive Officers

The following table indicates the name, age, term of office and position held by each of our executive officers and directors. Jerry Cornwell resigned as a director and officer on March 9, 2022, and no longer has a position with the Company.

Name	Age	Position	Incumbency Date
Patrick Bilton	6061	Director, Secretary, ~~and~~Chief ~~Director~~Executive Officer	11/03/2017 01/01/2018
Patrick Bilton		Chief Executive Officer	01/01/2018
Brad Herr	68	Chief Financial Officer	03/24/2018
Brad Herr	67	Chief Financial Officer	03/24/2018
Randy Lanier		Director	10/20/2021
Jerry Cornwell	82	Director and President	09/20/2011
Jason Roth	47	Director	03/09/2022
David Tobias	7071	Director	11/03/2017
Rich Turasky	51	Director	03/09/2022
Jerry Cornwell	83	Resigned as Director on 3/9/2022	n.a.

Certain biographical information with respect to our executive officers and directors.

Patrick Bilton, CEO, Secretary and Director manages our product development and product acquisition efforts and is focused on implementing our strategic business direction. Patrick joined MJ Harvest in 2017 as a director and has been instrumental in establishing our existing ~~operations~~ operations while also seeking to expand our business as opportunities present themselves. Patrick sold his landscape services business in in 2007 and after working with the new owners over a three-year transition period, has been, since 2010 to the present, involved as a a consultant in construction management, working primarily on luxury and high end residential real estate projects. Concurrently, ~~Patrick~~ Patrick has worked as a consultant with other public companies in their business development and merger and acquisition efforts, primarily focused on herbal and plant-based products and derivatives, including Cannabis Sativa, Inc. (~~symbol~~OTCQB: “CBDS”). Patrick brings a wealth of practical experience and a deep understanding of the requirements of growers of hemp and cannabis crops. With Patrick’s guidance, we are developing a portfolio of tools and implements that are used in growing and harvesting crops.

Brad Herr, CFO manages our financial reporting functions, provides risk management oversight, and is a key member of the management ~~team~~ team working closely with Patrick Bilton to evaluate and structure business opportunities as they arise. Brad is the sole owner of Nexit, Inc., a management services firm though which he offers business consulting services to the public,. Brad has owned Nexit, Inc. since April 2018. He also served as CFO to SponsorsOne, Inc., another publicly traded company with emerging business opportunities until April 30, 2019. Brad graduated from the University of Montana with a Bachelor of Science Degree in Business Accounting in 1977 and a Juris Doctorate in 1983. In 2005, Mr. Herr received an MBA from Gonzaga University. Brad practiced law for 13 years focusing primarily on business representation and securities law. Brad participated as legal counsel or principal in private and public offerings raising more than $75 million over his career. In 1996, Brad left the practice of law to pursue a career in business. Brad has served as CFO, COO, President and Board Member for a number of publicly traded and private companies over the last 23 years, though other than as set forth herein, he holds no such positions at this time. Brad brings a diverse business development, accounting and legal background to his current positions.

Jerry Cornwell, President and Director is currently and has been since 1993, the managing member of two Investor Relations companies: XXX Enterprises, LLC dba Bristol Media, Ltd. and Valhalla Financial Group, LLC. The services provided to clients range from initial merger of Microcap OTC companies to NASDAQ listed companies. He was President and Chief Executive Officer of Pan Environmental Corporation from 1993 until 2000. For the prior ten years, he was a principal of Corn-Mill Enterprises, a business advisory firm involved in Mergers/Acquisitions and Capital funding. From 1974 to 1983 Mr. Cornwell was owner, President and Chief Executive Officer of J. A. Cornwell, Inc. a land reclamation and irrigation development firm, with annual revenues of $135 million. In 1982 the company was listed #7 on Inc 500 fastest growing Private Companies. In the past 30 years Mr. Cornwell has held positions as Director and/or Officer, on at least 10 other public companies, though other than as set forth herein, he does not hold any such positions at this time. He was elected to the Board of Directors by shareholders and appointed as President/CEO of the Company, then operating as Ryozanpaku International, Inc. on October 24, 2010. Jerry currently focuses on the building an active market for the Company’s shares and provides assistance in finding and evaluating business opportunities.25

26Randy Lanier, Director, serves as our brand ambassador and offers guidance and assistance with our strategic business direction as requested by our CEO, Patrick Bilton. Randy joined MJHI in 2021. Randy’s career has included race car driving where he was the 1986 Rookie of the Year at the Indianapolis 500, the 1984 IMSA GTP Champion, and is currently a high-performance driving instructor. Randy has also worked as a behavioral health technician and treatment advocate, yoga instructor and is also an accomplished artist. Randy brings a wealth of practical experience and a deep understanding of the cannabis industry and has been utilizing his extensive contact list and network of other cannabis professionals to get the word out about MJHI’s vision.

Jason Roth, Director, sits on the Board of Directors for Next Frontier Pharmaceuticals which owns an FDA approved Cannabinoid Drug known as Syndros as well as Next Frontier Beverages based in London England.

Mr. Roth also has served since June of 2020 as Chief Executive Officer of Ackrell SPAC I, which recently announced a $904 million merger with Blackstone Products.

Previously, from its inception to October 2019 Mr. Roth was Co-Founder and served as Chief Executive Officer and Chairman of the board of directors of Mile High Labs International Inc, which was once one of the world’s largest processors of cannabis. While at Mile High Labs, Mr. Roth grew revenues from zero to nearly $100 million in the first year of business.

Mr. Roth previously served as the Chief Executive Officer of a large scale multi-national device company, was a founder and served as Senior Vice President, Commercial Director, Compliance Director and Board Member of Brooklands Inc., a medical device OEM/ODM approved by the U.S. FDA, and was a founder and served as Chief Executive Officer and Chairman of the board of directors of Safeguard Medical Technologies, a leading OEM/ODM medical device manufacturer approved by the U.S. FDA. Mr Roth holds numerous patents in the medical device sector.

David Tobias, Director is serving as President of Wild Earth Naturals, Inc., a position he has held since May 2013. In addition, Mr. Tobias is serving as the CEO, president, secretary and director of Cannabis Sativa, Inc. (“CBDS”), a fully reporting company under the Securities Exchange Act of 1934. Mr. Tobias has been a director and officer of CBDS since July of 2013. He also served as the President of Hemp, Inc. from August 2011 to January 9, 2014. Prior to that, from October 2009 until May 2011, Mr. Tobias held the position of Vice President at Medical Marijuana Inc. where he was instrumental in bringing forward and culminating the merger between CannaBank and Medical Marijuana, Inc. Within the last five years, Mr. Tobias has also served as a member of the board of directors for Grow Capital, Inc. (“GRWC”). David’s experience with many aspects of the burgeoning marijuana trade in the United States allows him to focus on business development. His extensive contacts in the cannabis industry yield frequent business opportunities which David refers to Patrick and Brad for a detailed conceptual work-up.

Rich Turasky, Director, has been in the Investment and Finance business for 30 years, investing with both private and institutional investors. He has been the managing partner in more than 100 partnerships. Additionally, as an accomplished entrepreneur Mr. Turasky has been a founding shareholder in more than a dozen operating companies. Most recently Rich was founding shareholder and since 2000 has been a board member of Next Frontier Holdings which recently acquired Benuvia Manufacturing, a leading synthetic pharmaceutical drug developer focused on pharma grade cannabinoids and psychedelics. Mr. Turasky, through Next Frontier Holdings, has also recently been a founding shareholder in various SPAC and reverse merger transactions worth nearly $2 billion.

There are no family relationships between Mr. Roth or Mr. Turacsky and any other director, executive officer or person nominated or chosen by the Company to become a director or executive officer. Except as disclosed under Item 1.01 above, there have been no transactions prior to the date of his appointment involving Mr. Roth or Mr. Turasky, or which are anticipated, that would require disclosure under Item 404(a) of Regulation S-K. As owners of Flight Venures, they will receive the compensation disclosed above under Item 1.01

Family Relationships

There are no family relationships between any of our officers and directors.

Term of Office

The term of office of each director is one year and until his or her successor is elected at the annual stockholders' meeting and is qualified. Directors are also subject to removal by the stockholders. The term of office for each officer is for one year and until his or her successor is appointed by the board of directors and is qualified. Officers are also subject to removal by the board of directors. Patrick Bilton was appointed Chief Executive Officer of the Company on January 1, 2018. Brad E. Herr was appointed Chief Financial Officer on March 24, 2018. Jerry Cornwell has been a director since November 3, 2011 and David Tobias has been a director since November 3, 2017.

Board of Directors

Our board of directors consists of ~~three~~five persons. ~~None~~Two of our current directors, Jason Roth and Rich Turasky, are "independent" within the meaning of Rule 5605(a)(3) of the NASDAQ Marketplace. The other directors are not independent by virtue of their position as an officer of the Company or their ownership of more than 10% of the Company’s outstanding shares.

Our board of directors designated an audit committee to be comprised of two independent directors. At this time, the Company has not appointed an independent "financial expert" to serve on the audit committee and the function of the audit committee is currently being performed by the entire Board.

The board of directors has designated a compensation committee comprised of two independent directors. At this time, the Company has not appointed independent directors to the compensation committee and the function of the compensation committee is currently being performed by the entire Board.

Our board of directors designated an audit committee to be comprised of two independent directors. At this time, the Company has no independent directors and does not have an independent "financial expert" to serve on the audit committee. As a result, the Company is not able to designate an audit committee and the function of the audit committee is currently being performed by the entire Board.

The board of directors has designated a compensation committee comprised of two independent directors. At this time, the Company only has no independent directors. As a result, the Company is not able to designate a compensation committee and the function of the compensation committee is currently being performed by the entire Board.

The Company does not have a standing nominating committee and the Company's Board of Directors performs the functions that would customarily be performed by a nominating committee. The Board of Directors does not believe a separate nominating committee is required at this time due to the limited resources of the Company. The Board of Directors has not established policies with regard to the consideration of director candidates recommended by security holders or the minimum qualifications of such candidates.

Director Meetings

The Company’s Board of Directors met telephonically as needed during the years ended May 31, ~~2021~~2022 and ~~2020~~2021. No regular meetings ~~are~~ are scheduled, and the Board members have been available by phone on short notice when Board action has been required. Most actions are accomplished without a meeting and each director consents to taking action without notice. In the year ending May 31, ~~2022~~2023, meetings will again be held as needed. In light of the COVID-19 Pandemic, the Board intends to ~~conduct~~continue conducting meetings remotely until further notice.

Communications with Directors

Stockholders may communicate with the Board of Directors by sending written communications addressed to the Board of Directors, or any individual director, to: MJ Harvest, Inc., Attention: Corporate Secretary, 9205 W. Russell Road, Suite 240, Las Vegas, NV 89139. All communications will be compiled by the corporate secretary and forwarded to the Board of Directors or any individual director, as appropriate. In order to facilitate a response to any such communication, the Company’s Board of Directors suggests, but does not require, that any such submission include the name and contact information of the shareholder submitting the communication.

Code of Ethics

We have not adopted a Code of Ethics that applies to our executive officers, including our principal executive, financial and accounting officers. We do not believe the adoption of a code of ethics at this time would provide any meaningful additional protection to the Company because we have only two executive officers and ~~three~~five directors and our business operations are not complex.

During the past ten years none of our directors, executive officers, promoters, or control persons was:

the subject of any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;

convicted in a criminal proceeding or is subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or

found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law.

2928

~~Section~~Delinquent Section 16(a) ~~Beneficial~~Reports ~~Ownership Reporting Compliance~~

On February 5, 2021, we voluntarily filed a registration statement on Form 10 to register our common stock as a class. The registration went effective on April 6, 2021, requiring the filing of a report on Form 3 by persons designated under Section 16(a) of the Exchange Act. Timely filing of the Form 3 was made by Mr. Herr and late filings were made by Messrs. Bilton, Cornwall, and Tobias. The following table sets forth the persons who failed to file on a timely basis required reports under Section 16(a) for the year ended May 31, 2022, and the number of late reports, the number of transactions that were not reported on a timely basis, and any known failure to file the required report:

Name	Form	Reported Late	Not Reported	Total
Patrick Bilton	Form 3	X		1
	Form 4		X	1
Brad Herr	Form 4	X		2
Jerry Cornwell	Form 3	X		1
	Form 4	X	X	5
David Tobias	Form 3	X		1
	Form 4	X	X	5
Randy Lanier	Form 3		X	1
	Form 4		X	5
Jason Roth	Form 3		X	1
Rich Turasky	Form 3		X	1

Item 11. Executive Compensation

The following table sets forth certain information regarding the annual compensation paid to our principal executive officer ~~and principal financial officer~~ in all capacities for the fiscal years ended May 31, 2022 and 2021, and ~~2020~~each executive officer other than the principal executive officer whose total compensation exceeded $100,000. No other person served as an executive officer of the Company or received total annual compensation from the Company in excess of $100,000 other than as set forth in the table.

SUMMARY COMPENSATION TABLE

Name & Principal Position	Year		Salary and Fees ($)		Stock Awards ($)		Total ($)
Patrick Bilton, President and CEO		2021		280,000		-0-		280,000
Patrick Bilton, President and CEO(1)		2022		280,000		40,000		280,000
		2020		-0-		413,000		413,692
		2021		280,000				280,000
Brad Herr, CFO		2021		120,000		60,000		180,000
Brad Herr, CFO(2)		2022		120,000		60,000		180,000
		2020		120,000		93,000		213,000
		2021		120,000		60,000		180,000
Randy Lanier, Brand Ambassador(3)		2022		-0-		130,213		130,213
		2021		-0-		34,284		34,284

~~All compensation~~(1) ~~reflected~~independent incontractor agreement between Mr. Bilton and the ~~above~~company ~~table~~called ~~was~~for ~~paid~~a ~~pursuant~~total tocompensation ~~independent~~of ~~contractor~~$280,000 ~~agreements~~to ~~between~~be ~~the~~paid ~~individuals~~50% ~~listed~~ in cash and ~~the~~50% ~~Company.~~in ~~All~~common stock. ~~awards~~this ~~were~~agreement ~~also~~had ~~authorized~~a byterm ~~the~~beginning ~~Board~~1/12020 ofand ~~Directors~~ending as12/31/2020 ~~such~~which ~~payments~~was ~~were~~amended ~~made~~to extend the ending date to 12/31/2022.

⁽²⁾

^{independent
contractor agreement between Mr. Herr and the Company called for a total compensation of
$180,000 to be paid 66.66% in cash and 33.33% in common stock. This agreement had a term
beginning 1/20/2020 and ending 12/31/2022 which was amended to extend the ending date to
12/31/2022.}

⁽³⁾

^{independent
contractor agreement between Mr. Lanier and the Company calls for a total compensation of
$120,000 on an annual basis in payable in either cash or shares of common stock. The term
of the agreement began on 10/20/2021 and is renewable each year.}

All compensation reflected in the above table was paid pursuant to independent contractor agreements between the individuals listed and the Company. All stock awards were also authorized by the Board of Directors as such payments were made. During the year ended May 31, 2022, the salary and fees due Mr. Bilton and Mr. Herr were accrued but not paid due to cash flow constraints. The stock awards due to Mr. Herr were paid by issuance of common stock on a quarterly basis.

We do not have any retirement, pension or profit-sharing plans covering our officers or directors, and we are not contemplating implementing any such plans at this time.

Outstanding Equity Awards

At fiscal year end of May 31, 2021, no named executive officer held any equity award requiring disclosure under this item.

Director Compensation

During the fiscal year ended May 31, ~~2021~~2022, the following compensation was paid to directors, excluding the named executive officers whose ~~compensation~~ compensation is disclosed above:

Name	Stock awards ($)		Total ($)
Jason Roth		50,000		50,000
David Tobias		40,000		40,000
Jerry Cornwell		40,000		40,000
Rich Turasky		50,000		50,000
Jerry Cornwell (former Director, resigned on March 9, 2022)		40,000		40,000

Our directors are generally issued shares of common stock quarterly for their service on the board of directors. During the year ended May 31, 2022, the directors were paid $10,000 each quarter. These amounts were paid in shares of common stock of the Company except for the fees due to Mr. Bilton, which were accrued and recorded as notes payable as of May 31, 2022.

Our directors are issued shares of common stock quarterly for their service on the board of directors. During the year ended May 31, 2021, the directors were paid $10,000 each quarter. These amounts were paid in shares of common stock of the Company.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The following table sets forth certain information furnished by current management and others, concerning the ownership of our common ~~stock~~ stock as of August 1529, ~~2021~~2022, of (i) each person who is known to us to be the beneficial owner of more than 5% of our common stock~~, without regard to any limitations on conversion or exercise of convertible securities or warrants~~; (ii) all directors and named executive officers; and (iii) our directors, ~~named executive officers,~~ and executive officers as a group:

Name and Address of Beneficial Owner		Amount and Nature of Beneficial Ownership(2)				Percent of Class(2)
Name of Beneficial Owner	Address of Beneficial Owner	Title	Amount of Beneficial Ownership	Nature of Beneficial Ownership	Percent of Class
Patrick Bilton(1)			4,133,401	(3)			16.2	%
Patrick Bilton	9205 W. Russell Rd., #240	CEO and Director	9,225,950	Direct	20.57%
Jerry Cornwell(1)			3,697,218	(4)			14.5	%
	Las Vegas, NV 89148
Brad Herr(1)			640,462	(5)			2.5	%
Old Floresta LLC	9205 W. Russell Rd., #240	Beneficially owned by Patrick Bilton	3,859,412	Indirect	8.60%
David Tobias(1)			6,389,373				25.1	%
	Las Vegas, NV 89148
Executive Officers and Directors as a Group (4 Persons)			16,380,454				64.3	%
David Tobias	9205 W. Russell Rd., #240	Director	6,631,875	Direct	14.79%
PPK Investment Group, Inc. (6)			1,520,000	(7)			6.0	%
	Las Vegas, NV 89148
Randy Lanier	9205 W. Russell Rd., #240	Director	53,571	Direct	0.12%
	Las Vegas, NV 89148
Lanier Management LLC	9205 W. Russell Rd., #240	Beneficially owned by Randy Lanier	556,522	Indirect	1.24%
	Las Vegas, NV 89148
Jason Roth, President	9205 W. Russell Rd., #240	Director	166,667	Indirect	0.37%
Big Horse Holdings, Inc.	Las Vegas, NV 89148
Rich Turasky, Member	9205 W. Russell Rd., #240	Director	104,167	Indirect	0.23%
Boulder Capital, LLC	Las Vegas, NV 89148
Brad Herr, President	9205 W. Russell Rd., #240	CFO	1,623,925	Indirect	3.62%
Nexit Inc.	Las Vegas, NV 89148
Ralph Clinton Pyatt, III, President	9205 W. Russell Rd., #240	COO	1,520,000	Indirect	3.39%
PPK Investment Group, Inc.	Las Vegas, NV 89148
Executive Officers as a Group			23,742,089		52.93%
Jerry Cornwell	38574 Clear Sky Way	5% beneficial owner	1,185,331	Direct	2.64%
	Palm Desert, CA 92211
XXX Enterprises, Inc.	38574 Clear Sky Way	Beneficially owned by Jerry Cornwell	2,446,261	Direct	5.45%
	Palm Desert, CA 92211
Shawn Falconbridge, Member	8271 E. Gelding Dr.	5% beneficial owner	5,972,222	Direct	13.31%
Consensus Holdings, LLC	Scottsdale, AZ 85260

~~(1)The~~This ~~address~~table ~~for~~is based upon information supplied by officers, directors and principal stockholders and is believed to be accurate. Unless otherwise indicated in the footnotes to this table, we believe that each ~~party~~of the stockholders named in this table has sole voting and investment power with respect to the shares indicated as beneficially owned. Beneficial ownership is ~~9205~~determined Win accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. ~~Russell~~Shares Rdof our common stock subject to options, warrants, or other conversion privileges currently exercisable or convertible, or exercisable or convertible within 60 days of the date of this table, are deemed outstanding for computing the percentage of the person holding such option or warrant but are not deemed outstanding for computing the percentage of any other person. Where more than one person has a beneficial ownership interest in the same shares, ~~Suite~~the ~~240~~sharing of beneficial ownership of these shares is designated in the footnotes to this table. As of the date of this table, ~~Las~~we ~~Vegas~~had 44,854,737 NVshares ~~89139~~outstanding.

(2)This table is based upon information supplied by officers, directors and principal stockholders and is believed to be accurate. Unless otherwise indicated in the footnotes to this table, we believe that each of the stockholders named in this table has sole voting and investment power with respect to the shares indicated as beneficially owned. Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. Shares of our common stock subject to options, warrants, or other conversion privileges currently exercisable or convertible, or exercisable or convertible within 60 days of the date of this table, are deemed outstanding for computing the percentage of the person holding such option or warrant but are not deemed outstanding for computing the percentage of any other person. Where more than one person has a beneficial ownership interest in the same shares, the sharing of beneficial ownership of these shares is designated in the footnotes to this table. As of the date of this table, we had 25,477,122 shares outstanding.

(3)Includes 830,000 shares held by Old Floresta, LLC, an entity owned and controlled by Mr. Bilton.

(4)Includes 2,446,261 shares held by XXX Enterprises, LLC, an entity owned and controlled by Mr. Cornwell.

(5)These shares are held of record by Nexit, Inc., an entity owned and controlled by Mr. Herr.

(6)The address for PPK Investment Group, Inc. is 1704 East Rock Island Avenue, Wilburton, Oklahoma 74578.

(7)The shares owned by PPK Investment Group, Inc. are voted by Clinton Pyatt, President.

There are no current arrangements which will result in a change in control.

Item 13. Certain Relationships and Related Transactions, and Director Independence

During the year ended May 31, ~~2021~~2022, the Company received additional advances totaling $~~208~~257,~~000~~500 from Mr. Patrick Bilton, Chief Executive Officer and director of the Company, to cover operating expenses. In addition, Mr. Bilton deferred payment of his salary and director fees in the aggregate amount of $280,000 which is recorded as payable to related party for services in the financial statements. David Tobias, a director, also advanced $1,000 to the Company in the year ended May 31, 2022. As of May 31, ~~2021~~2022, ~~net~~ total advances from related parties totaled $1,~~317~~821,~~982~~482. This amount is comprised of $~~$928~~1,~~414~~150,914 due to Mr. Bilton for advances to the Company, $~~280~~560,000 due to Mr. Bilton for deferred salary, $8081,553 due to Mr. Tobias, a director for advances to the Company, and $29,015 due to Mr. Cornwell, a director for advances to the Company. The Company has not recorded interest on these amounts. On July 8, 2022, the related parties converted an aggregate of $1,971,482 of related party advances and itpayables is(including ~~likely~~$150,000 ~~that~~in accounts payable due to Nexit, Inc., a corporation wholly owned by Brad Herr, the ~~balances~~Company’s ~~will~~Chief beFinancial ~~paid~~Officer) ininto common stock at a ~~future~~price ~~date~~of $0.187 per share or an aggregate of 10,542,682 shares.

Approval of Related Party Transactions

Related party transactions are reviewed and approved or denied by the board of directors of the Company. If the related party to a transaction is a member of the board of directors, the transaction must be approved by a majority of the board that does not include the related party.

Item 14. Principal Accounting Fees and Services

The following table presents aggregate fees that were billed or expected to be billed for the fiscal years ended May 31, ~~2021~~2022, and ~~2020,~~ 2021, for professional services rendered by Assure CPA LLC.

	Assure CPA LLC 2021		Assure CPA LLC 2020
	Assure CPA LLC 2022		Assure CPA LLC 2021
Audit Fees	$	4753,~~200~~600	$	3747,~~800~~200
Audit-Related Fees		—		—
Tax Fees		—		—
Other Fees		2,200		62,~~100~~200
Total	$	4955,~~400~~800	$	4349,~~900~~400

“Audit Fees” represents fees for professional services provided in connection with the audit of our annual financial statements, review of financial statements included in our quarterly reports and related services normally provided in connection with statutory and regulatory filings and engagements and consents.

“Audit-Related Fees.” No audit related fees were incurred in the years ended May 31, ~~2021~~2022 and ~~2020~~2021.

“Tax Fees” consists of fees for professional services rendered by our principal accountants for tax compliance, tax advice and tax planning.

“Other Fees” consists of fees for products and services provided by our principal accountants, other than the services reported under “Audit Fees,” “Audit-Related Fees,” or “Tax Fees” above.

Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors

It is the policy of the Company for all work performed by our principal accountant to be approved in advance by our audit committee. ~~Currently~~ Currently the ~~audit~~Board ~~committee~~has ~~does~~ not ~~have~~appointed ~~the~~an ~~requisite~~audit ~~number~~committee ofand ~~independent Board Members. Accordingly,~~ the functions of the audit committee are ~~now~~ being performed by the Full Board. All of the services described above in this Item 14 were approved in advance by our Board of Directors.

Item 15. Exhibit and Financial Statement Schedules.

(a) Financial Statements

The following financial statements are included with this report:

	Page
Report of Independent Auditor	F-1
Consolidated Balance Shares at May 31, 2021 and 2020	F-2
Consolidated Balance Sheets at May 31, 2022 and 2021	F-2
Consolidated Statements of Operations for the years ended May 31, 2021 and 2020	F-3
Consolidated Statements of Operations for the years ended May 31, 2022 and 2021	F-3
Consolidated Statements of Changes in Stockholders’ Equity for the years ended May 31, 2021 and 2021	F-4
Consolidated Statements of Changes in Stockholders’ Equity for the years ended May 31, 2022 and 2021	F-4
Consolidated Statements of Cash Flows for the years ended May 31, 2021 and 2020	F-5
Consolidated Statements of Cash Flows for the years ended May 31, 2022 and 2021	F-5
Notes to Consolidated Financial Statements	F-6

(b) Exhibits

Exhibit Number	SEC Reference Number	Title of Document	Location
3.1	3	Articles of Incorporation	Incorporated by Reference(1)
3.2	3	Bylaws	Incorporated by Reference(1)
10.1	10	Independent Contractor Agreement with Patrick Bilton effective January 1, ~~2019~~2020	~~Incorporated~~This ~~by Reference(1)~~Filing
10.2	10	Independent Contractor Agreement with Brad E. Herr effective January 1, ~~2019~~2020	~~Incorporated~~This ~~by Reference(1)~~Filing
10.3	10	Addendum to Independent Contractor Agreement with Patrick Bilton effective January 1, 2021	This Filing
10.4	10	Addendum to Independent Contractor Agreement with Brad E. Herr effective January 1, 2021	This Filing
10.5	10	Securities Purchase Agreement with PPK Investment Group, Inc. dated March 22, 2021	Incorporated by Reference(2)
10.6	10	Convertible Note from PPK Investment Group, Inc. dated March 24, 2021	Incorporated by Reference(2)
10.7	10	Independent Contract Agreement with Randy Lanier effective October 20, 2021	Incorporated by Reference(4)
21.1	21	Subsidiaries of Registrant	This Filing
31.1	31	Section 302 Certification of Chief Executive Officer	This Filing
31.2	31	Section 302 Certification of Chief Financial Officer	This Filing
32.1	32	Section 1350 Certification of Chief Executive Officer	This Filing
32.2	32	Section 1350 Certification of Chief Financial Officer	This Filing
101.INS		XBRL Instance Document	(3)
101.SCH		XBRL Taxonomy Extension Schema	(3)
101.CAL		XBRL Taxonomy Extension Calculation Linkbase	(3)
101.DEF		XBRL Taxonomy Extension Definition Linkbase	(3)
101.LAB		XBRL Taxonomy Extension Label Linkbase	(3)
101.PRE		XBRL Taxonomy Extension Presentation Linkbase	(3)

Exhibit Number	SEC Reference Number	Title of Document	Location
10.3	10	Securities Purchase Agreement with PPK Investment Group, Inc. dated March 22, 2021	Incorporated by Reference(2)
10.4	10	Convertible Note from PPK Investment Group, Inc. dated March 24, 2021	Incorporated by Reference(2)
21.1	21	Subsidiaries of Registrant	This Filing
31.1	31	Section 302 Certification of Chief Executive Officer	This Filing
31.2	31	Section 302 Certification of Chief Financial Officer	This Filing
32.1	32	Section 1350 Certification of Chief Executive Officer	This Filing
32.2	32	Section 1350 Certification of Chief Financial Officer	This Filing
101.INS		XBRL Instance Document	(3)
101.SCH		XBRL Taxonomy Extension Schema	(3)
101.CAL		XBRL Taxonomy Extension Calculation Linkbase	(3)
101.DEF		XBRL Taxonomy Extension Definition Linkbase	(3)
101.LAB		XBRL Taxonomy Extension Label Linkbase	(3)
101.PRE		XBRL Taxonomy Extension Presentation Linkbase	(3)

⁽¹⁾ Incorporated by reference to Exhibits 3.1 and 3.2 of the Company’s Form S-1 Registration Statement which was declared effective on January 9, 2020.

(1) Incorporated by reference to Exhibits 3.1, 3.2, 10.1 and 10.2 of the Company’s Form S-1 Registration Statement which was declared effective on January 9, 2020.

⁽²⁾Incorporated by reference to Exhibit 10.1 and 10.2 of the Company’s current report on Form 8-K dated March 30, 2021.

⁽³⁾XBRL information is furnished and not filed for purposes of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Exchange Act of 1934, and is not subject to liability under those sections, is not part of any registration statement or prospectus to which it relates and is not incorporated or deemed to be incorporated by reference into any registration statement, prospectus or other document. These files will be added by amendment.

⁽⁴⁾Incorporated by reference to Exhibit 99.1 of the Company’s current report on Form 8-K dated October 26, 2021.

Item 16. Form 10-K Summary

None

[SIGNATURES ON NEXT PAGE]

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	MJ HARVEST, INC.
	(Registrant)
Dated: September 13, 2021	By: /s/ Patrick Bilton
Dated: September 23, 2022	By: /s/ Patrick Bilton
	Patrick Bilton, Chief Executive Officer

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

Dated: September 13, 2021	/s/ Patrick Bilton
Dated: September 23, 2022	/s/ Patrick Bilton
	Patrick Bilton
	Chief Executive Officer and Director
	(Principal Executive Officer)
Dated: September 13, 2021	/s/ Brad E. Herr
Dated: September 23, 2022	/s/ Brad E. Herr
	Brad E. Herr
	Chief Financial Officer and Director
	(Principal Financial Officer)
	(Principal Accounting Officer)
Dated: September 13, 2021	/s/ David Tobias
Dated: September 23, 2022	/s/ David Tobias
	David Tobias
	Director
Dated: September 13, 2021	/s/ Jerry Cornwell
Dated: September 23, 2022	/s/ Rich Turasky
	Jerry Cornwell
	Rich Turasky Director
Dated: September 23, 2022	/s/ Randy Lanier____________________________
	Randy Lanier Director
Dated: September 23, 2022	/s/ Jason Roth______________________________
	Jason Roth
	Director

MJ HARVEST, INC.

	Page

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	2

FINANCIAL STATEMENTS:

Consolidated balance sheets	3

Consolidated statements of operations	4

Consolidated statements of changes in stockholders’ equity (deficit)	5

Consolidated statements of cash flows	6

Notes to consolidated financial statements	7-23

Contents

	Page
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	2
FINANCIAL STATEMENTS:
Consolidated balance sheets	3
Consolidated statements of operations	4
Consolidated statements of changes in stockholders’ equity (deficit)	5
Consolidated statements of cash flows	6
Notes to consolidated financial statements	7-20

Report of Independent Registered Public Accounting Firm

To the stockholders and the board of directors of MJ Harvest, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of MJ Harvest, Inc. (the "Company") as of May 31, ~~2021~~2022 and ~~2020~~2021, the related consolidated statements of operations, changes in stockholders’ equity (deficit) and cash flows for each of the 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 May 31, ~~2021~~2022 and ~~2020~~2021, and the results of its operations and its cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America.

The Company’s Ability to Continue as a Going Concern

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 financial statements, the Company has continuing losses and accumulated deficit. These factors raise substantial doubt about its 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 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 audits 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 audits 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 audits 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 audits provide a reasonable basis for our opinion.

/s/ Assure CPA, LLC

We have served as the Company's independent auditor since 2016.

444

Spokane, Washington

September 1323, ~~2021~~2022

F-2

MJ HARVEST, INC.

~~Consolidated Balance Sheets~~ CONSOLIDATED BALANCE SHEETS

~~May~~ MAY 31, ~~2021~~2022 ~~and~~AND ~~2020~~2021

	2021			2020
	2022			2021
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	~~123~~40,~~319~~887		$	32123,~~343~~319
Accounts receivable		—			19,216
Inventory		197,059			28,159
Vendor deposits		—			20,000
Prepaids and other current assets		20,225			—
Inventory		28,159			32,840
Total current assets		258,171			151,478
Total current assets		151,478			104,399
Investments in equity securities, at cost		3,091,666			1,000,000
Investment in PPK		1,000,000			—
Equipment, net		36,636			10,839
Fixed assets, net		10,839			15,879
Right to use asset		287,716			—
Finite-lived intangible assets		~~125~~110,834			~~465~~125,834
Indefinite-lived intangible assets		6,000			256,000
Total Assets	$	13,~~294~~791,~~151~~023		$	~~611~~1,~~112~~294,151
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
CURRENT LIABILITIES:
Accounts payable	$	181,594		$	62,801
Accounts payable and accrued liabilities	$	240,649		$	103,815
Notes payable, net of discount		350,000			—
Accounts payable to related parties		278,207			77,779
Other current liabilities		—			35,060
Lease liability - current portion		46,761			—
Total current liabilities		531,594			97,861
Convertible note payable, net of discount		107,586			—
Common stock payable		100,000			100,000
Notes payable, net of discount		—			350,000
Advances from related parties		1,317,982			829,982
Total current liabilities		673,203			531,594
Total Liabilities		1,949,576			1,027,843
Common stock payable		128,785			100,000
COMMITMENTS AND CONTINGENCIES (Note 3)
Accounts payable to related parties - long-term		150,000			—
Lease liability - long-term		247,366			—
Advance from non-related party		50,000			—
Advances from related parties		1,821,482			1,317,982
Total Liabilities		3,070,836			1,949,576
COMMITMENTS AND CONTINGENCIES (Note 4 and 13)
STOCKHOLDERS’ EQUITY (DEFICIT):
Preferred stock, par value $0.0001, 5,000,000 shares authorized, no shares issued and outstanding		—			—
Common stock, $0.0001 par value per share, 100,000,000 shares authorized, 25,302,122 and 22,892,874 issued and outstanding, respectively		2,530			2,289
Common stock, $0.0001 par value per share, 100,000,000 shares authorized, 33,574,436 and 25,302,122 issued and outstanding respectively		3,357			2,530
Additional paid-in capital		812,~~440~~690,~~302~~871			38,~~763~~440,~~374~~302
Accumulated deficit		(911,~~098~~974,~~257~~041	)		(49,~~182~~098,~~394~~257	)
Total stockholders' equity (deficit)		(655,425	)		(416,731	)
Total Stockholders' Equity (Deficit)		720,187			(655,425	)
Total Liabilities and Stockholders' Equity (Deficit)	$	13,~~294~~791,~~151~~023		$	~~611~~1,~~112~~294,151

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

F-3

MJ HARVEST, INC.

~~Consolidated Statements of Operations~~ STATEMENTS OF OPERATIONS

~~For~~ FOR THE ~~the~~YEARS ~~years~~ENDED ~~ended~~MAY ~~May~~ 31, ~~2021~~2022 ~~and~~AND ~~2020~~2021

	2021			2020
	2022			2021
REVENUE	$	89172,~~186~~825		$	~~129~~89,~~975~~186
COST OF REVENUE		40185,~~454~~852			1740,~~585~~454
Gross profit		48,732			112,390
Gross profit (loss)		(13,027	)		48,732
OPERATING EXPENSES:
Officer and director compensation		~~535~~663,~~000~~800			~~708~~535,000
General and administrative		~~107~~677,~~546~~677			84107,~~779~~546
Impairment of intangible assets		—			758,000
Professional fees and contract services		515,792			430,656
Professional fees and contract services		430,656			531,125
Total operating expenses		1,857,269			1,073,202
Total operating expenses		1,073,202			2,081,904
NET OPERATING LOSS FROM CONTINUING OPERATIONS		(1,870,296	)		(1,024,470	)
NET LOSS FROM CONTINUING OPERATIONS		(1,024,470	)		(1,969,514	)
NON-OPERATING EXPENSES
Interest expense		(~~378~~777,~~442~~732	)		—(378,442	)
Loan financing fees		(2227,~~906,000~~756	)		—(2,906,000	)
Impairment on investment		~~(592,800~~—	)		—(592,800	)
Total non-operating expenses		(31,~~877~~005,~~242~~488	)		—(3,877,242	)
GAIN (LOSS) FROM DISCONTINUED OPERATIONS
NET LOSS FROM CONTINUING OPERATIONS		(2,875,784	)		(4,901,712	)
Operating loss from discontnued operations		(4,151	)		5,839
LOSS FROM DISCONTINUED OPERATIONS
Loss on discontinued operations		(10,000	)		—
Operating loss from discontinued operations		—			(4,151	)
Total gain (loss) from discontinued operations		(14,151	)		5,839
Loss on discontinued operations		—			(10,000	)
NET LOSS	$	(4,915,863	)	$	(1,963,675	)
Total loss from discontinued operations		—			(14,151	)
NET LOSS PER COMMON SHARE - Basic and diluted	$	(0.21	)	$	(0.10	)
NET LOSS	$	(2,875,784	)	$	(4,915,863	)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - Basic and diluted		23,262,759			20,204,819
NET LOSS PER COMMON SHARE - Basic and diluted
From continuing operations		(0.09	)		(0.21	)
From discontinued operations		—			(0.00	)
Total	$	(0.09	)	$	(0.21	)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - Basic and diluted		31,188,055			23,262,759

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

F-4

MJ HARVEST, INC.

~~Consolidated~~ STATEMENTS OF ~~Statements~~CHANGES ofIN ~~Changes~~STOCKHOLDERS' inEQUITY ~~Stockholders’ Equity~~ (~~Deficit~~DEFICIT)

~~For~~ FOR THE ~~the~~YEARS ~~years~~ENDED ~~ended~~MAY ~~May~~ 31, ~~2021~~2022 ~~and~~AND ~~2020~~2021

	Common Stock						Additional Paid-In			Accumulated
							Additional
	Common Stock						Paid-In			Accumulated
	Shares			Amount			Capital			Deficit			Total
BALANCE AT May 31, 2019		18,758,739		$	1,876		$	1,784,486		$	(2,218,719	)	$	(432,357	)
BALANCES, May 31, 2020		22,892,874		$	2,289		$	3,763,374		$	(4,182,394	)	$	(416,731	)
Acquisiton of intangible assets		1,400,000			140			1,007,860			—			1,008,000
Cancellation of shares related to Elevated		(1,300,000	)		(130	)		(336,745	)					(336,875	)
Share based compensation		2,225,635			222			843,954			—			844,176
Shares issued for stock payable		508,500			51			127,074			—			127,125
Net loss		—			—			—			(1,963,675	)		(1,963,675	)
BALANCE AT May 31, 2020		22,892,874		$	2,289		$	3,763,374		$	(4,182,394	)	$	(416,731	)
Cancellation of shares related to Elevated		(1,300,000	)		(130	)		(336,745	)		—			(336,875	)
Share based compensation		989,248			99			358,145			—			358,244
Shares issued for loan financing fee		1,200,000			120			1,799,880			—			1,800,000
Warrants issued for loan financing fee		—			—			1,883,000			—			1,883,000
Shares issued for investment in PPK		1,520,000			152			972,648			—			972,800
Net loss		—			—			—			(4,915,863	)		(4,915,863	)
BALANCE AT May 31, 2021		25,302,122		$	2,530		$	8,440,302		$	(9,098,257	)	$	(655,425	)
BALANCES, May 31, 2021		25,302,122			2,530			8,440,302			(9,098,257	)		(655,425	)
Share based compensation		1,334,055			133			560,840			—			560,973
Shares issued for common stock payable		400,000			40			99,960			—			100,000
Shares issued for investments in equity securities		6,538,259			654			2,091,012			—			2,091,666
Beneficial conversion feature associated with convertible note payable		—			—			1,498,757			—			1,498,757
Net loss		—			—			—			(2,875,784	)		(2,875,784	)
BALANCES, May 31, 2022		33,574,436		$	3,357		$	12,690,871		$	(11,974,041	)	$	720,187

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

F-5

MJ HARVEST, INC.

~~Consolidated Statements~~ STATEMENTS ofOF ~~Cash~~CASH ~~Flows~~ FLOWS

~~For~~ FOR THE ~~the~~YEARS ~~years~~ENDED ~~ended~~MAY ~~May~~ 31, ~~2021~~2022 ~~and~~AND ~~2020~~2021

	2021			2020
	2022			2021
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(42,~~915~~875,~~863~~784	)	$	(14,~~963~~915,~~675~~863	)
Adjustments to reconcile net loss to net cash used in operating activities:
Share based compensation		358,244			844,176
Depreciation and amortization		20,041			33,165
Depreciation and amortization		33,165			14,206
Share based compensation		560,973			358,244
Loss on discontinued operation		10,000			—
Advances from related party for services		280,000			280,000
Amortization of note payable discount		350,000			—
Common stock payable for compensation		128,785			—
Loan financing fees		2,906,000			—
Loss on discontinued operation		—			10,000
Impairment of intangible assets		—			758,000
Amortization of note payable discount		657,587			350,000
Impairment of investment in PPK		592,800			—
Loan financing fees		227,756			2,906,000
Impairment of investment in PPK		—			592,800
Changes in operating assets and liabilities:
Accounts receivable		19,216			(10,025	)
Inventory		7,773			4,681
Deposits		20,000			(19,520	)
Prepaids and other current assets		(20,225	)		39,216
Inventory		4,681			23,365
Accounts payable and accrued liabilities		143,245			5,954
Accounts payable and other current liabilities		83,733			81,946
Accounts payable to related parties		142,917			77,779
NET CASH (USED IN) OPERATING ACTIVITIES		(~~538~~726,~~024~~932	)		(~~271~~258,~~527~~024	)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of intangibles		(6,000	)		—
Acquisition of intangible assets		—			(6,000	)
Payment made to Elevated in unwinding (Note 10)		(10,000	)		—
Payment made to Elevated in unwinding		—			(10,000	)
Convertible note receivable issued to PPK		~~(620,000~~—	)		—(620,000	)
NET CASH (USED) IN INVESTING ACTIVITIES		~~(636,000~~—	)		—(636,000	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable		~~810~~1,271,000			—810,000
Financing fees paid in cash		~~(33,000~~—	)		—(33,000	)
Proceeds from advances from related parties		488,000			290,278
Payments on notes payable		(900,000	)		—
NET CASH PROVIDED BY FINANCING ACTIVITIES		1,265,000			290,278
Proceeds from advances from related parties		258,500			208,000
NET CHANGE IN CASH AND CASH EQUIVALENTS		90,976			18,751
Payments on advances from related parties		(35,000	)		—
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		32,343			13,592
Proceeds from advances from non-related parties		50,000			—
CASH AND CASH EQUIVALENTS END OF YEAR	$	123,319		$	32,343
NET CASH PROVIDED BY FINANCING ACTIVITIES		644,500			985,000
Supplemental disclosure of cash flow information Cash paid for interest	$	20,700		$	2,976
NET CHANGE IN CASH AND CASH EQUIVALENTS		(82,432	)		90,976
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		123,319			32,343
CASH AND CASH EQUIVALENTS END OF YEAR	$	40,887		$	123,319
Supplemental disclosure of cash flow information
Cash paid for interest	$	107,236		$	20,700
Non cash financing and investing activities:
Common stock issued for acquisition of Elevated assets		—			1,008,000
Cancellation of common stock returned by Elevated		—			336,875
Cancellation of common stock returned by Elevated (Note 10)		336,875
Common stock issued for investments		2,091,666			972,800
Common stock issued for investment in PPK		972,800			—
Beneficial conversion feature associated with note payable		1,498,757			—
Conversion of PPK note receivable to investment in PPK		~~620,000~~—			—620,000
Common stock to be issued for patents		—			100,000
Common stock issued for stock payable		100,000			—
Common stock issued for stock payable		—			127,125
Inventory purchased with accounts payable - related parties		176,673			—
Equipment purchased with accounts payable - related parties		30,838			—
Right to use asset acquired with lease liability		308,127			—

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

F-6

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

MJ Harvest, Inc. (the “Company”), develops, acquires, and distributes agricultural and horticultural tools and implements for sale primarily to growers and operators in the hemp and cannabis retail industry. The Company owns 100% of G4 Products LLC, (“G4”) ~~which~~ which owns intellectual property for a patented manual debudder product line marketed under the Original 420 Brand as the Debudder Bucket ~~Lid~~ Lid and Edge. The Company also owns 100% of AgroExports LLC (“Agro”) which serves as the domestic and international distribution arm for sales of agricultural and horticultural tools and implements. The Company operates its sales portal website, www.procannagro.com, for online sales of its products.

In 2019, the Company formed AgroExports.CA ULC (“Agro Canada“”), a wholly owned Canadian subsidiary in order to facilitate ~~online~~ online payments from sales in Canada. Sales in Canada are currently serviced through a fulfillment center in Toronto. In 2021, the Company formed Country Cannabis, Inc. (“CCCO”), a wholly owned Colorado subsidiary that operates a cannabis manufacturing facility in Colorado which became active in the latter half of the year ended May 31, 2022. CCCO is in the process of acquiring cannabis licenses for the manufacture and distribution of products containing THC and/or THC derivatives. Pending transfer of the licenses, the Company is operating the Colorado facility pursuant to a license agreement with a third party from whom the Company leases its Colorado processing facility.

In the year ending May 31, 2021, the Company expanded its focus to include a minority investment interest in PPK Investment Group, Inc. (“PPK“”) a vertically integrated cannabis company in Oklahoma that operates as a grower, harvester, processor, ~~manufacturer~~ manufacturer and distributor of the Country Cannabis Brand of cannabis products. The ~~investment~~Company has continued to expand its cannabis focus in ~~PPK~~the ~~represents~~current year with new investments in WDSY LLC and BLIP Holdings LLC, owners of the Weedsy and BLVK brands, respectively. These investments represent a shift in focus from an agricultural implements based business to a broader cannabis industry focus.

In the current year ending May 31, 2022, the Company, through its subsidiary CCCO, expanded its business through acquisition cannabis manufacturing and distribution licenses in Colorado and currently operates in leased premises in Denver Colorado. The Company also entered into an agreement to acquire cannabis manufacturing and distribution licenses in California which was finalized in July 2022. With these additional acquisitions, the Company continues its shift in focus toward manufacture of products containing THC and CBD and toward product distribution in the states of Colorado and California.

Basis of Presentation and Consolidation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP“”). The Company’s fiscal year-end is May 31.

The consolidated financial statements of the Company include the accounts of the Company and its wholly owned subsidiaries Agro, G4, and Agro Canada. All intercompany transactions have been eliminated. Subsidiaries are consolidated from the date of acquisition, that being the date on which the Company has the power to govern financial and operating policies of the entities acquired. The financial statements of the subsidiaries are reported for the same reporting period as the parent, using consistent accounting policies in all material respects.

Going Concern

The Company has an accumulated deficit on May 31, 2021 of $9,098,257 which, among other factors, raises substantial doubt about the Company‘s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to generate profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due.

F-7

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

~~NOTE~~The 1consolidated –financial ~~NATURE~~statements OFof ~~BUSINESS~~the ~~AND~~Company ~~SIGNIFICANT~~include ~~ACCOUNTING~~the ~~POLICIES~~accounts of the Company and its wholly owned subsidiaries Agro, ~~Continued:~~G4, Agro Canada and CCCO. All intercompany transactions have been eliminated. Subsidiaries are consolidated from the date of acquisition, that being the date on which the Company has the power to govern financial and operating policies of the entities acquired. The financial statements of the subsidiaries are reported for the same reporting period as the parent, using consistent accounting policies in all material respects.

Going Concern

The Company has an accumulated deficit on May 31, 2022 of $11,974,041 and negative working capital of $415,032 which, among other factors, raises substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to generate profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due.

Additional acquisitions and business opportunities are now under consideration. Management intends to finance operating costs over the next twelve months with cash flows from operations, private placement or public offering of common stock or debt instruments, and when necessary, advances from directors and officers. The accompanying financial statements do not include any adjustments that might be required should the Company be unable to continue as a going concern.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Share based compensation for services, impairment of investments and other long-lived assets, amortization of intangible assets, and income taxes are subject to estimates. Actual results could differ from those estimates.

Reclassifications

Certain ~~prior~~reclassifications ~~period amounts~~ have been ~~reclassified~~made to conform ~~with~~prior periods’ amounts to the current ~~year~~ presentation. These reclassifications have no effect on the results of operations, stockholders’ equity (deficit) and cash flows as previously reported.

New Accounting Standards

In August ~~2018~~ 2020, the Financial Accounting Standards Board (“FASB“") issued ~~Accounting~~ASU No. 2020-06 Debt ~~Standards~~- ~~Update~~Debt ~~(“ASU“)~~with Conversion ~~2018~~and Other Options (Subtopic 470-~~13,~~20) ~~Fair~~and ~~Value~~Derivatives ~~Measurement~~and ~~(Topic~~Hedging—Contracts ~~820):~~in ~~Disclosure~~Entity’s ~~Framework~~Own Equity (Subtopic 815-40): Accounting ~~Changes~~for toConvertible ~~the~~Instruments ~~Disclosure~~and ~~Requirements~~Contracts ~~for~~in ~~Fair~~an ~~Value~~Entity’s ~~Measurement~~Own Equity. The update ~~modifies~~is ~~the~~to ~~disclosure~~address ~~requirements~~issues ~~for~~identified ~~recurring~~as ~~and~~a result ~~nonrecurring~~of ~~fair~~the ~~value~~complexity ~~measurements,~~associated ~~primarily~~with ~~those~~applying ~~surrounding Level~~generally 3accepted ~~fair~~accounting ~~value~~principles ~~measurements~~to ~~and~~certain ~~transfers~~financial ~~between~~instruments ~~Level~~with 1characteristics of liabilities and ~~Level 2~~equity. The ~~new~~update ~~standard~~ is effective for fiscal years beginning ~~after~~ after December 15, ~~2019~~2021, including interim periods within ~~that~~those ~~reporting~~fiscal ~~period~~years and with early adoption permitted. ~~Adoption~~The ofCompany ~~this~~will adopt the update as of July ~~June~~ 1, ~~2020~~2022 ~~did not~~and ~~have~~does not expect a ~~material~~significant impact onto ~~the~~our ~~Company’s~~ consolidated financial statements or disclosures.

In November 2018, the FASB issued ASU 2018-18, Clarifying the Interaction Between Topic 808 and Topic 606 Revenue from Contracts with Customers, which clarifies when transactions between participants in a collaborative arrangement are within the scope of Topic 606. Adoption of this update as of June 1, 2020 did not have a material impact on the Company’s consolidated financial statements.

In August 2020, the FASB issued 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 Contracts in an Entity’s Own Equity. The update is to address issues identified as a result of the complexity associated with applying generally accepted accounting principles for certain financial instruments with characteristics of liabilities and equity. The update is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years and with early adoption permitted. Management is evaluating the impact of this update on the Company’s consolidated financial statements.

F-8

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires entities to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 2014-09, Revenue from Contracts with Customers (Topic 606). The update will generally result in an entity recognizing contract assets and contract liabilities at amounts consistent with those recorded by the acquiree immediately before the acquisition date rather than at fair value. The update is effective on a prospective basis for fiscal years beginning after December 15, 2022, with early adoption permitted. The Company will adopt the update as of July 1, 2023 and does not expect a significant impact to our consolidated financial statements or disclosures.

Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption.

Fair Value Measurements

GAAP specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows:

Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active).

Level 3 - Unobservable inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.

At May 31, ~~2021~~2022 and ~~2020~~2021, the Company did not have any assets or liabilities that were measured at a fair value on a recurring basis.

Financial Instruments

The carrying amounts of cash and cash equivalents, investment in ~~PPK,~~equity securities and advances from related parties, ~~reported on the consolidated balance sheets~~ approximate their fair value as of May 31, ~~2021~~2022 and ~~2020~~2021. ~~The~~At May 31, 2021, the principal balance of notes payable also approximates ~~its~~their fair value asdue to the short term of the notes. At May 31, ~~2021~~2022, the fair value of the principal balance of the convertible note payable was approximately $2.4 million based on the number of shares into which the note is convertible multiplied by the trading price of the Company’s stock on May 31, 2022.

Investments

Equity securities are generally measured at fair value. Unrealized gains and losses for equity securities are included in earnings. If an equity security does not have a readily determinable fair value, the Company may elect to measure the security at its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment in the same issuer. At the end of each reporting period, the Company reassesses whether an equity security without a readily determinable fair value qualifies to be measured at cost minus impairment, considers whether impairment indicators exist to evaluate whether the investment is impaired and, if so, records an impairment loss. Upon sale of an equity security, the realized gain or loss is recognized in earnings.

F-9

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

~~Cash and cash equivalents~~ Investments

Equity securities are generally measured at fair value. Unrealized gains and losses for equity securities are included in earnings. Investments in which the Company concludes it does not have the ability to exercise significant influence are accounted for under the cost less impairment method. Upon sale of an equity security, the realized gain or loss is recognized in earnings.

Investments in companies for which the Company has the ability to exercise significant influence but do not control are accounted for under the equity method.

Under the cost less impairment method, if an equity security does not have a readily determinable fair value, the Company may elect to measure the security at its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment in the same issuer. At the end of each reporting period, the Company reassesses whether an equity security without a readily determinable fair value qualifies to be measured at cost minus impairment. The Company also considers whether impairment indicators exist to evaluate whether the investment is impaired and, if so, recognizes an impairment loss if the fair value exceeds the investment’s carrying amount.

Under the equity method of accounting, the Company’s share of the net earnings or losses of the investee are included in other income (expense) in the consolidated statements of operations. At the end of each reporting period, the Company considers whether impairment indicators exist to evaluate whether an equity method investment is impaired and, if so, recognizes an impairment loss if the fair value exceeds the investment’s carrying amount.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less when acquired to be cash equivalents.

Revenue Recognition

The Company generates revenue based on sales of products and revenue is recognized at a point in time when the Company satisfies its performance ~~obligation~~ obligation by shipping products to our customers. ~~Our products consist of agricultural tools and implements, soils, and soil additives used primarily in growing and harvesting hemp and marijuana.~~ Shipments terms are generally FOB origination, and revenue is recognized when the ~~product~~ product is delivered to the shipper by our fulfillment centers or, in the case of drop shipments of distributed products, when the products are shipped from the manufacturer. At the time the products are delivered to the shipper, no other performance obligations remain. Revenue is recognized in an amount that reflects the consideration that is received in exchange for the products shipped.

The Company accounts for shipping and handling activities as a fulfillment cost and include fees received for shipping and handling as part of the transaction price. Provision for sales incentives, discounts, and returns and allowances, if applicable, are accounted for as reductions of revenue in the period the related sales are recorded. Sales incentives, discounts and returns and allowances were not material in the periods presented in the accompanying consolidated financial statements. The Company had no warranty costs associated with the sales of its products in the periods presented in the accompanying consolidated statements of operations and no provision for warranty expenses has been included.

Inventory

Inventory consists of purchased products and is stated at the lower of cost or market, with cost being determined using the average cost method. Allowances for obsolete inventory are recognized when the inventory is determined to be unsalable through the normal course of business.

Fixed Assets

Fixed assets consist of molds used in the third-party manufacturing process and are recorded at cost. Maintenance, repairs, and minor replacements are expensed as incurred. Gains or losses on disposition or retirement of property and equipment are recognized in operating expenses in the period of disposal.

Depreciation is computed using the straight-line method over the estimated useful lives of the molds which is five years.

Accounting for Acquisitions

Business acquisitions are recorded using the acquisition method of accounting and, accordingly, the purchase price is allocated to the assets acquired and liabilities assumed based on their estimated fair value as of the date of acquisition. After the purchase price has been allocated, goodwill is recorded to the extent the total consideration paid for the acquisition, including the acquisition date fair value of contingent consideration, if any, exceeds the sum of the fair values of the separately identifiable acquired assets and assumed liabilities. Acquisition costs for business combinations are expensed when incurred.

F-10

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Inventory

Inventory is stated at the lower of cost or net realizable value, with cost being determined using the average cost method. Manufactured products costs include raw materials, direct labor, quality control testing processing facility overhead costs, and freight. Allowances for obsolete inventory are recognized when the inventory is determined to be unsalable through the normal course of business.

Equipment

Equipment is recorded at historical costs and are depreciated using the straight-line method over estimated useful lives of three to five years. Maintenance, repairs, and minor replacements are expensed as incurred. Gains or losses on disposition or retirement of fixed assets are recognized in operating expenses in the period of disposal.

Accounting for Acquisitions

Acquisitions not meeting the accounting criteria to be accounted for as a business combination are accounted for as an asset acquisition. An asset acquisition is recorded at its purchase price, inclusive of acquisition costs, which is allocated among the acquired assets and assumed liabilities based upon their relative fair values at the date of acquisition.

The operating results of an acquisition are included in the consolidated statements of operations from the date of acquisition.

The allocation of the purchase consideration for acquisitions can require extensive use of accounting estimates and judgments to allocate the purchase consideration to the assets acquired and liabilities assumed based on their respective fair values. Judgment is required in determining which valuation technique should be applied. Critical estimates in valuing certain identifiable assets include but are not limited to market comparables, expected long-term revenues; future expected operating expenses; cost of capital; assumed attrition rates; and discount rates.

Intangible Assets

Intangible asset amounts are initially recognized at the acquisition date fair values of intangible assets acquired.

Finite-lived intangible assets are amortized over their useful lives. The carrying amounts of finite-lived intangible assets are evaluated for recoverability whenever events or changes in circumstances indicate that the Company may be unable to recover the asset’s carrying amount.

When there is no foreseeable limit on the period of time over which an intangible asset is expected to contribute to the cash flows of the Company, an intangible asset is determined to have an indefinite life. Indefinite life intangible assets are not amortized but tested for impairment annually or more frequently when indicators of impairment exist.

Determination of ~~acquisition date~~ fair values ~~and~~of intangible asset for impairment ~~tests~~assessments require judgment. Significant judgments required to estimate the fair value of intangible assets include determining the appropriate valuation method, identifying market prices for similar type items, estimating future cash flows, determining appropriate discount rates and other assumptions. Changes in estimates and assumptions or the occurrence of one or more confirming events in future periods could cause the actual results or outcomes to materially differ from such estimates.

Income taxes

The Company utilizes the liability method of accounting for income taxes which requires that deferred tax assets and liabilities be recorded to reflect the future tax consequences of temporary differences between the book and tax basis of various assets and liabilities. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Additionally, deferred tax assets are evaluated, and a valuation allowance is established if it is more likely than not that all or a portion of the deferred tax asset will not be realized. There can be no assurance that the Company’s future operations will produce sufficient earnings so that the deferred tax asset can be fully utilized. The Company currently maintains a full valuation allowance against net deferred tax assets.

F-11

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Income Taxes

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. The Company evaluates its tax positions taken or expected to be taken in the course of preparing its tax returns to determine whether the tax positions will more likely than not be sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold are not recorded as a tax benefit or expense in the current year. No reserve for uncertain tax positions has been recorded.

Net Earnings (Loss) Per Share

Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding ~~for~~ for the period. Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares and dilutive common stock equivalents outstanding. During periods in which the Company incurs losses, common stock equivalents, if any, are not considered, as their effect would be anti-dilutive. ~~During~~For the ~~year~~years ended May 31, ~~2021,~~2022 ~~the~~and ~~Company had 3~~2021,~~000,000~~ ~~warrants~~potentially ~~outstanding which were anti-~~dilutive ~~due~~common tostock equivalents ~~the~~not ~~net~~included ~~loss recognized~~ in the ~~period.~~calculation Inof ~~the~~diluted ~~year~~earnings ~~ended~~per ~~May 31,~~share ~~2020,~~because ~~the~~they ~~Company~~were ~~had~~anti-dilutive noare ~~common~~as ~~stock equivalents outstanding.~~follows:

Schedule of anti-dilutive shares
	2022		2021
Stock purchase warrants		3,000,000		3,000,000
Convertible notes		9,817,196		—
		12,817,196		3,000,000

Share-Based Payments

All transactions in which goods or services are received for the issuance of shares of the Company’s common stock are accounted for based on the fair value of the common stock issued and recognized when the board of directors authorizes the issuance.

~~NOTE~~COVID-19 2Coronavirus –Pandemic ~~INTANGIBLES~~Response and Impact

The 2019 novel strain of coronavirus (“COVID-19”) was characterized as a global pandemic by the World Health Organization on March 11, 2020. We continue to take precautionary measures to mitigate the impact of COVID-19, including implementing operational plans and practices. As long as they are required, the operational practices implemented could continue to have an adverse impact on our operating results due to deferred production and revenues or additional costs. We continue to monitor the rapidly evolving situation and guidance from federal, state, local and foreign governments and public health authorities and may take additional actions based on their recommendations. The extent of the impact of COVID-19 on our business and financial results will also depend on future developments, including the duration and spread of the outbreak and the success of the current vaccination programs and the related impact on prices, demand, creditworthiness and other market conditions and governmental reactions, all of which are highly uncertain.

F-12

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AtNOTE ~~May~~2 ~~31,~~– ~~2021 and 2020, intangibles assets are:~~ EQUIPMENT

Schedule of intangible assets
	May 31,			May 31,
Intangibles	2021			2020
Finite lived intangibles
Patents	$	250,000		$	250,000
Less: Impairment of patents		(100,000	)		(100,000	)
		150,000			150,000
Less: accumulated amortization		(24,166	)		(9,166	)
Patents, net		125,834			140,834
Non-compete agreement		157,000			157,000
Less: impairment of non-compete		(107,000	)		(107,000	)
		50,000			50,000
Less: accumulated amortization		(6,900	)		—
Less: adjustment for discontinued operations		(43,100	)		—
Non-compete agreement, net		—			50,000
Customer relationships		826,000			826,000
Less: Impairment of relationships		(551,000	)		(551,000	)
		275,000			275,000
Less: accumulated amortization		(6,225	)		—
Less: adjustment for discontinued operations		(268,775	)
Customer relationships, net		—			275,000
Total finite lived intangibles		125,834			465,834
Indefinite lived intangibles
Domain names		31,000			25,000
Less: adjustment for discontinued operations		(25,000	)		—
Total domain names		6,000			25,000
Total intangibles	$	131,834		$	490,834

At May 31, 2022 and 2021, equipment includes the following:

Amortization expense for the year ended May 31, 2021 and 2020 was $15,000 and $9,166, respectively (excluding discontinued operations which recorded amortization expense in the year ended May 31, 2021 of $13,125). This amortization related exclusively to the patents.

Schedule of equipment
	May 31,			May 31,
Equipment	2022			2021
Equipment - production molds	$	25,109		$	25,109
Manufacturing equipment		30,837			—
Less: Accumulated depreciation and amortization		(19,310	)		(14,270	)
Net equipment	$	36,636		$	10,839

The ~~estimated~~manufacturing ~~aggregate~~equipment ~~amortization~~was ~~expense~~acquired ~~for~~near ~~each~~the end of the ~~next~~current ~~five~~ fiscal ~~years~~year ~~ending~~for onthe Company’s operations in Cathedral City, California. That location was in the set-up stage as of May 31, ~~are~~2022 asand ~~follows:~~no depreciation was recorded on the manufacturing assets in the year ended May 31, 2022.

Schedule of amortization of intangible assets
2022	$	15,000
2023	$	15,000
2024	$	15,000
2025	$	15,000
2025	$	15,000

NOTE 3 – INTANGIBLES

At May 31, 2022 and 2021, intangibles assets are:

Schedule of intangible assets
	May 31,			May 31,
Intangibles	2022			2021
Finite lived intangibles
Patents	$	250,000		$	250,000
Less: impairment of patents		(100,000	)		(100,000	)
		150,000			150,000
Less: accumulated amortization		(39,166	)		(24,166	)
Patents, net		110,834			125,834

Non-compete agreement		—			157,000
Less: impairment of non-compete		—			(107,000	)
		—			50,000
Less: accumulated amortization		—			(6,900	)
Less: adjustment for discontinued operations		—			(43,100	)
Non-compete agreement, net		—			—

Customer relationships		—			826,000
Less: impairment of relationships		—			(551,000	)
		—			275,000
Less: accumulated amortization		—			(6,225	)
Less: adjustment for discontinued operations		—			(268,775	)
Customer relationships, net		—			—
Total finite lived intangibles		110,834			125,834

Indefinite lived intangibles
Domain names		6,000			31,000
Less: adjustment for discontinued operations		—			(25,000	)
Total domain names		6,000			6,000
Total intangibles	$	116,834		$	131,834

Amortization expense for the year ended May 31, 2022 and 2021 was $15,000 and $15,000, respectively (excluding discontinued operations which recorded amortization expense in the year ended May 31, 2021 of $13,125). The patents are amortized over their useful lives of ten years. Amortization of intangibles is expected to be $15,000 for each of the next five years.

The Company assessed the fair value of the patent rights using an evaluation of expected future revenues and earnings from the intangible patent rights. This assessment resulted in no impairment charge during the years ended May 31, 2022 and 2021.

F-13

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

~~The~~On ~~Company~~October ~~assessed~~8, 2019, the ~~fair~~patents ~~value~~were ofissued by the ~~patent~~United ~~rights~~States ~~using~~Patent anand ~~evaluation~~Trademark ofOffice ~~expected~~(“USPTO”) ~~future~~on ~~revenues~~the debudder product and ~~earnings~~the ~~from~~Company became obligated to pay an additional $100,000 to the ~~intangible~~inventor under contingent terms of the G4 acquisition agreement. ~~patent~~The ~~rights~~agreement called for the payment to be in the form of 400,000 shares of the Company’s common stock. ~~This~~The ~~assessment~~$100,000 ~~resulted~~was included in nothe ~~impairment~~patents’ ~~charge~~acquisition ~~during~~value and a common stock payable was established for the ~~years~~contingent ~~ended~~payment. During the year ended May 31, ~~2021~~2022, the contingency was resolved and ~~2020~~the Company issued the 400,000 shares of common stock.

On ~~October~~May 828, ~~2019~~2021, the ~~patents~~Company ~~were~~acquired ~~issued~~the bydomain ~~the~~name, ~~United~~MJHI.com ~~States~~for ~~Patent~~$6,000. ~~and~~The ~~Trademark~~new ~~Office~~domain ~~(“USPTO”)~~name onmatches the ~~debudder~~Company’s ~~product~~stock symbol and ~~the~~is ~~Company~~likely ~~became~~to ~~obligated~~be toeasier ~~pay~~for ancustomers ~~additional~~and ~~$100,000~~other stakeholders to ~~the~~remember. ~~inventor~~The ~~under~~domain ~~contingent~~name ~~terms~~is ofan ~~the~~indefinite G4lived ~~acquisition~~intangible ~~agreement~~asset ~~which~~and ~~was~~will ~~added~~not tobe ~~the patents carrying value~~amortized. ~~This~~As ~~amount~~of ~~for the years ended~~ May 31, ~~2021~~2022, ~~and~~there ~~2020~~were isno ~~payable~~indications inof ~~400,000~~impairment ~~shares~~ of ~~common~~ ~~stock~~this ~~valued~~indefinite atlived ~~$0.25~~intangible ~~per share~~asset.

OnNOTE ~~May~~4 ~~28,~~– 2021, the Company acquired the domain name, MJHI.com for $6,000. The new domain name matches the Company’s stock symbol and is likely to be easier for customers and other stakeholders to remember. The domain name is an indefinite lived intangible asset and will not be amortized. As of May 31, 2021, there were no indications of impairment of this indefinite lived intangible asset.INVESTMENTS

~~During~~At ~~the year ended~~ May 31, ~~2020,~~2022 the Company entered into an acquisition with Elevated Ag Solutions, Inc. (“Elevated”) to acquire certain intangible assets the Company expected to apply to an expanded online agricultural product line and ~~distribution. The acquisition did not produce the expected results and the Company and Elevated entered into an agreement to unwind the acquisition on November 4~~2021, ~~2020.~~ ~~The~~investments ~~unwinding was completed in March 2021 and the Company discontinued the operations acquired from Elevated and no longer holds any intangible assets relating to the Elevated acquisition. See Note 10.~~are:

NOTE 3 – INVESTMENT IN PPK INVESTMENT GROUP, INC.

Schedule of investments
	May 31,		May 31,
Investments	2022		2021
PPK Investment Group, Inc.	$	2,791,666	$	1,000,000
WDSY, LLC		200,000		—
BLIP Holdings, LLC		100,000		—
Total investments	$	3,091,666	$	1,000,000

PPK

On March 24, 2021, the Company, as lender, closed a loan to PPK Investment Group, Inc. (“PPK”) in the form of a convertible note (“Note”) in the amount of $620,000. The convertible note bore interest at 6% per annum and was due on September 1, 2021. In accordance with its terms, the Company converted the Note on May 19, 2021 into a 6.2% interest in PPK. Upon conversion, the interest accrued of $5,707 through the date of conversion was forgiven.

Upon conversion, a Securities Purchase Agreement dated March 24, 2021 (the “PPK Agreement”) became effective and the Company ~~acquired~~ acquired an additional 3.8% interest in PPK (10% in total) for payment of $380,000 by issuance of 1,520,000 shares of restricted common stock of the Company. The fair value of shares was $972,800 based on the ~~trading~~closing price of the Company’s shares of $0.64. The Company determined that the fair value of the 3.8% interest on the conversion date was $380,000 which was the negotiated price between the two parties. Thus, the Company recorded an impairment expense of $592,800 on the conversion date.

~~The~~On August ~~PPK~~26, ~~Agreement~~2021, ~~includes~~the aCompany ~~put~~acquired ~~option allowing~~an ~~PPK~~additional to15% ~~put~~interest ~~shares~~in ofPPK ~~the~~(25% ~~Company’s~~ownership ~~common~~in ~~stock~~total) ~~received~~pursuant asto ~~part~~a ofSecurities ~~the~~Purchase ~~Company’s~~Agreement with ~~investment~~an ineffective ~~PPK,~~date ~~back~~of toMay ~~the Company~~19, at2021 ~~$0.25~~through ~~per~~issuance ~~share.~~of ~~The~~5,972,222 ~~put~~shares ~~option~~of ~~protects~~restricted ~~PPK~~common ~~against~~stock avalued ~~drop~~at in$1,791,666 based on the ~~market~~closing price of the Company’s common stock ~~below~~on the of $0.25 30 per share. ~~The~~as ~~put~~of ~~option~~August ~~may~~16, be2021, ~~exercised~~the ~~after~~date ~~six~~fixed ~~months~~by ~~from~~agreement for pricing the ~~date~~issuance of the ~~investment on May 19, 2021~~shares. ~~Not~~The ~~more~~additional ~~than 5~~15% ofacquisition under the ~~total shares~~Securities ~~held~~Purchase byAgreement ~~PPK~~called ~~can~~for bepayment ~~put~~of ~~back~~$930,000 in tocash ~~the~~and ~~Company~~$570,000 in ~~any~~stock, ~~calendar~~but ~~quarter.~~by ~~The~~supplemental ~~put~~agreement, ~~option~~PPK ~~had~~agreed noto ~~value~~accept atpayment ~~May~~for ~~31,~~15% ~~2021~~in as the ~~Company’s common~~form ~~stock~~of ~~was~~all ~~trading~~common ~~above~~stock ~~$0.25~~of the ~~on that date~~Company.

The PPK Agreement ~~gives~~includes ~~the~~a ~~Company~~put ~~the~~option ~~right~~allowing PPK to ~~increase~~put ~~its~~shares ~~investment~~of upthe toCompany’s acommon ~~100%~~stock ~~ownership~~received ~~interest~~as part of the Company’s investment in PPK, ~~provided~~back ~~such~~to ~~increased ownership~~the isCompany inat ~~compliance~~$0.25 ~~with~~per ~~Oklahoma~~share. ~~State~~The ~~cannabis~~put ~~licensing~~option ~~requirements.~~protects ~~Terms~~PPK ofagainst ~~purchase~~a ~~for~~drop ~~increased~~in ~~ownership~~the market price of ~~PPK~~the Company’s ~~will~~common stock below $0.25 per share. The put option may be ~~similar~~exercised toafter ~~those~~six asmonths from the ~~initial~~date ~~acquisition~~of ~~with~~each ainvestment. ~~combination~~No more than 5% of ~~cash~~the ~~and~~total shares ofheld by PPK can be put back to the Company’s ~~common~~in ~~stock~~any calendar quarter. The put option had value of $nil and $nil at ~~After~~May 31, 2022 and May 31, 2021,. ~~the~~The ~~Company~~put ~~increased~~option ~~its~~continues ~~investment~~so inlong as PPK toholds ~~25%.~~shares ~~See~~of ~~Note~~MJHI ~~12,~~that ~~Subsequent~~it ~~Events~~received as part of MJHI’s investment in PPK.

The PPK Agreement gives the Company the right to increase its investment up to a 100% ownership interest in PPK, provided such increased ownership is in compliance with Oklahoma State cannabis licensing requirements. Terms of purchase for increased ownership of PPK will be similar to those as the initial acquisition with a combination of cash and shares of the Company’s common stock.

F-14

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The Company, pursuant to the PPK Agreement, is also obligated to pay an earnout to PPK as follows:

●· The Company is required to pay additional consideration to PPK for an earnout in the event the PPK business valuation at the end of a pre-determined look back period is greater than $10,000,000. For purposes of the earnout, the valuation will be based on three times earnings before interest, taxes, depreciation, and amortization (EBITDA). If EBITDA exceeds $3,333,333 in the twelve months immediately preceding the look back date of March 31, 2023, additional consideration will be owed to PPK under the earnout in an amount sufficient to equal the earnout valuation less $10,000,000 times the percentage of PPK then owned by the Company. Such additional consideration will be paid 62% in cash and 38% in shares of the Company’s common stock. No liability has been accrued for this potential obligation as the Company has assessed the probability of an obligation being incurred to be remote as of May 31, 2022.

●· The Company ~~agrees~~also toentered ~~employ~~into an employment agreement with Ralph Clinton Pyatt III (“Clinton Pyatt”), President of PPK, to continue his role as Chief Executive Officer and President of PPK business for a ~~period~~three-year ofterm ateffective ~~least~~May ~~three~~22, ~~years~~2021.

● The Company ~~would~~also ~~have~~has an option to acquire the real estate that PPK utilizes in its operations. The real estate is currently under lease to PPK by an affiliated company owned by Clinton Pyatt, the President of PPK.

~~NOTE~~WDSY 4and ~~– NOTES PAYABLE~~BLIP

On ~~March~~October 228, 2021, the Company entered into ~~agreements~~two ~~with~~brand ~~AJB~~development ~~Capital~~agreements ~~Investments~~with WDSY, LLC (“~~AJB~~WDSY”) and ~~SDT~~Blip Holdings, LLC (“~~SDT~~BLIP”) for ~~the~~expansion ~~purchase~~ of anthe ~~aggregate~~“WEEDSY” ofand ~~$900,000 in Promissory Notes (the~~ “~~Notes~~BLVK”) brands, ~~$300~~respectively,~~000~~ ~~from AJB~~into Oklahoma and ~~$600,000~~South ~~for SDT~~Dakota. Under ~~The~~the ~~terms~~agreements, ofPPK ~~the~~will ~~Notes~~manufacture ~~are~~and ~~the~~distribute ~~same~~these ~~except~~brands ~~for~~in ~~the~~Oklahoma ~~dollar~~and ~~amounts~~South Dakota and ~~fees~~will ~~which~~pay ~~are~~the ~~double~~respective ~~for SDT~~companies ~~compared~~10% toroyalties ~~AJB.~~on ~~The~~all ~~terms~~net sales of the ~~Notes~~branded ~~are~~products ~~described below~~ in ~~the~~those ~~aggregate~~territories.

~~The~~On ~~Notes~~October ~~provided~~8, ~~for~~2021, anthe ~~original~~Company ~~issue~~acquired ~~discount~~a of 10% orinterest ~~$90,000,~~in ~~payment~~WDSY ofin ~~legal~~exchange ~~fees~~for 377,358 shares of ~~$22,500,~~the ~~and~~Company’s ~~payment~~common ofstock ~~$10,500~~and ~~for~~a ~~due~~10% ~~diligence~~interest ~~fees,~~in ~~resulting~~BLIP in ~~net~~exchange ~~proceeds~~for to188,679 shares of the Company’s ofcommon ~~$777,000~~stock. The ~~Notes~~shares ~~bear~~were ~~interest~~valued at the ~~rate~~closing price of ~~12%~~the ifcommon ~~paid~~stock, ~~on or~~$0.53 ~~before~~per ~~September~~share, 21on October 8, 2021. ~~The~~Additional ~~Company~~shares ~~has~~may ~~the~~be ~~right~~due to ~~extend~~WDSY ~~the~~and ~~Notes~~BLIP ~~for~~based anon ~~additional~~lookback ~~six~~valuations of both companies. The lookback valuations will be based on trailing twelve months atsales anfor ~~interest~~WDSY ~~rate~~and oftrailing three-month sales for ~~15%~~BLIP on the second anniversary of each agreement, inor ~~which~~sooner ~~case~~if the ~~Notes~~agreements ~~would~~are beterminated ~~due~~before ~~March~~the 21second anniversaries. At May 31, 2022., ~~The~~management ~~Notes~~has ~~are~~assessed ~~secured~~the byprobability ~~all~~of ~~assets~~a potential liability due under the lookback valuation provisions of WDSY and BLIP to be low and no stock payable was due. No liability has been accrued for this potential obligation as the Company has assessed the probability of an obligation being incurred to be remote as of May 31, 2022.

~~Interest~~The onCompany ~~the~~also ~~notes~~ is ~~payable~~required into ~~monthly~~pay ~~installments~~royalties ofto ~~$9,000~~WDSY onand ~~the~~BLIP, ~~first~~respectively, ofbased ~~each month with the first payment due~~ on ~~April~~10% ~~1, 2021. An aggregate~~ of ~~$20,700~~revenues ~~in interest was incurred and paid~~ on ~~the~~product ~~notes~~sold inby the ~~period~~Company ~~ended May 31, 2021. The notes provide~~ that ~~the~~contain ~~full~~each ~~amount~~ of ~~interest on~~ the ~~notes~~companies’ ~~for~~brand ~~the~~names ~~initial~~and ~~six-month~~logos. ~~term~~No ~~will~~such beproducts ~~payable~~were ~~even~~sold ifby the ~~notes~~Company ~~are~~during ~~paid~~the ~~off~~year ~~prior to~~ended ~~expiration~~May of31, ~~the initial term~~2022.

The Company ~~also~~evaluated ~~paid~~its ainvestment ~~financing~~in ~~fee of $3~~PPK,~~683,000 by~~ ~~issuance~~WDSY ~~of 1,200,000 shares of its restricted common stock~~ and ~~3,000,000~~BLIP ~~warrants~~as ~~to purchase shares that are exercisable at $0.38 per share with a three-year term expiring on March 21, 2024. The financing fee shares were valued at $1,800,000 based on the trading price~~ of ~~the~~May ~~Company’s common stock on the date of the borrowing. The warrants were valued at $1~~31,~~883,000~~ ~~using~~2022 ~~the~~and ~~Black-Scholes~~identified ~~method based~~no onindicators ~~a current stock price~~ of ~~$1.50~~possible ~~per~~impairment ~~share~~ on ~~the warrant issuance date, exercise price of $0.38, an expected term of three years,~~their ~~stock~~carrying ~~volatility of 334~~values.~~5% and a discount rate of 0.32%. One half of the warrants may be redeemed for an aggregate payment of $1.00 by the Company if the notes payable are paid in full by September 22, 2021.~~

F-15

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

InNOTE ~~aggregate,~~5 ~~financing~~– ~~fees~~NOTES and original issue discount totaled $3,806,000 which is greater than the note payable balance of $900,000. As a result, the Company recorded a full discount of $900,000 against the balance of the note payable and is amortizing the discount over the term of the note. During the year ended May 31, 2021, the Company recognized $350,000 in amortization expense leaving an unamortized discount balance of $550,000 as of May 31, 2021. This balance will be amortized through September 2021. The remaining amount of the financing fees of $2,906,000 was recognized as expense for the year ended May 31, 2021.PAYABLE

InAJB ~~aggregate, financing fees~~ and ~~original~~SDT issue discount totalled $3,806,000 which is greater than the note payable balance of $900,000. As a result, the Company recorded a full discount of $900,000 against the balance of the note payable and is amortizing the discount over the term of the note. During the year ended May 31, 2021, the Company recognized $350,000 in amortization expense leaving an unamortized discount balance of $550,000 as of May 31, 2021. This balance will be amortized through September 2021. The remaining amount of financing fees of $2,906,000 was recognized as expense for the year ended May 31, 2021. Notes

InOn anMarch ~~event~~22, ~~of default~~2021, the ~~remaining~~Company ~~principal~~entered ~~amount~~into agreements with AJB Capital Investments LLC (“AJB”) and SDT Holdings LLC (“SDT”) for the purchase of an aggregate of $900,000 in Promissory Notes (the ~~notes~~“AJB/SDT ~~plus~~Notes”), ~~all~~$300,000 ~~accrued~~from ~~interest~~AJB and ~~any~~$600,000 ~~other~~for SDT. ~~fees~~The ~~then~~terms ~~due~~of ~~may~~the ~~be converted~~AJB/SDT atNotes are the ~~sole~~same ~~election~~except offor the ~~note~~dollar ~~holders~~amounts ~~into~~and ~~shares~~fees which are double for SDT compared to AJB. The terms of the ~~Company’s~~AJB/SDT ~~common~~Notes ~~stock~~are described below in the aggregate.

~~NOTE~~The 5AJB/SDT –Notes ~~RELATED~~provided ~~PARTY~~for ~~TRANSACTIONS~~an original issue discount of 10% or $90,000, payment of legal fees of $22,500, and payment of $10,500 for due diligence fees, resulting in net proceeds to the Company of $777,000. The AJB/SDT Notes bear interest at the rate of 12% from origination through September 21, 2021 and 15%, from September 22, 2021 through maturity on March 21, 2022. The AJB/SDT Notes were secured by all assets of the Company.

~~Related~~An ~~party~~aggregate ~~advances~~of ~~represent funds advanced to the Company for working capital. At May 31~~$103,536 ~~2021~~ and ~~2020~~$20,700 ~~respectively,~~in ~~the~~interest ~~Company had~~was ~~advances~~incurred ~~from related parties~~ and ~~balances due for expenses~~ paid on ~~behalf of~~ the ~~Company.~~AJB/SDT ~~These~~Notes ~~amounts~~in ~~are~~the ~~not~~period ~~subject~~ended ~~to repayment~~May ~~terms~~31, ~~bear~~2022 noand ~~interest~~2021, ~~and are expected to be repaid to the related parties in common stock at a future date~~respectively. ~~These related party transactions and balances are set out in the following tables.~~

Schedule of related party transactions
	Related Party Advances at		Additions During the Year Ended May 31, 2021				Related Party Advances at		Payable to Related Parties for Services at
	May 31, 2020		Advances		Services		May 31, 2021		May 31, 2021
Related Parties
Patrick Bilton, CEO and Director
Cash Advances	$	726,414	$	202,000	$	—	$	928,414	$	—
Payable for services		—				280,000				280,000
David Tobias, Director		80,553		—		—		80,553		—
Jerry Cornwell, Director		23,015		6,000		—		29,015		—
Total for related parties	$	829,982	$	208,000	$	280,000	$	1,037,982	$	280,000
Aggregate advances from related parties									$	1,317,982

The Company also paid a financing fee of $3,683,000 by issuance of 1,200,000 shares of its restricted common stock and 3,000,000 warrants to purchase shares that are exercisable at $0.38 per share with a three-year term expiring on March 21, 2024. The financing fee shares were valued at $1,800,000 based on the trading price of the Company’s common stock on the date of the borrowing. The warrants were valued at $1,883,000 using the Black-Scholes method based on a current stock price of $1.50 per share on the warrant issuance date, exercise price of $0.38, an expected term of three years, stock volatility of 334.5% and a discount rate of .32%.

	Related Party Advances at		Additions During the Year Ended May 31, 2021				Related Party Advances at		Payable to Related Parties for Services at
	May 31, 2019		Advances		Services		May 31, 2020		May 31, 2020
Related Parties
Patrick Bilton, CEO and Director	$	448,455	$	277,959	$	—	$	726,414	$	—
David Tobias, Director		75,553		5,000		—		80,553		—
Jerry Cornwell, Director		15,696		7,319		—		23,015		—
Total for related parties	$	539,704	$	290,278	$	—	$	829,982	$	—

In aggregate, financing fees and original issue discount totaled $3,806,000 which is greater than the note payable balance of $900,000. As a result, the Company recognized full discount of $900,000 against the balance of the notes payable and amortized the discount over the term of the note. During the year ended May 31, 2021, financing fees of $2,906,000 was recognized as expense.

During the year ended May 31, 2022 and 2021, the Company recognized $550,000 and $350,000 in interest expense for the amortization of debt discount.

The AJB/SDT Notes were paid in full on March 29, 2022.

SMC-CCH Note

On May 11, 2022, the Company entered into an agreement with SMC Cathedral City Holdings, LLC, a Delaware limited liability company (“SMC-CCH”) for the sale of a $2,317,198 Secured Convertible Promissory Note (the “Note”). The Note provides for an original issue discount of $817,198, resulting in net proceeds to the Company of $1,500,000. The Note bears interest at the rate of 12% due at maturity which is twelve months from the issue date of the Note or May 10, 2023. The Note is secured by all assets of the Company.

Any principal amount or interest on the Note that is not paid when due will bear interest at the lesser of 16% or the maximum amount permitted by law.

The principal amount of the Note and interest may be converted at any time following the issue date into fully paid and nonassessable shares of the Company’s common stock at a conversion price of $0.20 per share. The number of shares issuable upon conversion is limited to 4.99% of the outstanding shares at the time of conversion, unless waived by SMC-CCH upon 61 days prior written notice.

So long as any balance due on the Note remains outstanding, the Company has agreed to utilize 50% of proceeds from issuance of debt or equity securities, conversion of outstanding warrants, issuance of securities pursuant to an equity line of credit, or the sale of assets, to reduce the outstanding balance of the Note.

F-16

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

~~NOTE~~The 6Company –has ~~SHARE~~also ~~CAPITAL~~agreed to enter into a lease of property at 68350 Commercial Road, Cathedral City California where the Company will operate an extraction and manufacturing operation. The lease will be effective upon completion of the sale of the property to an affiliate of SMC-CCH. This lease was entered into in July 2022 (see Note 14 Subsequent Events).

~~The~~During ~~authorized~~the ~~capital~~year ofended May 31, 2022, the Company ~~consists~~received ofa ~~100,000,000~~portion ~~common~~of ~~shares~~the proceeds with a ~~par~~principal ~~value~~balance of $~~0.0001~~1,963,439 ~~per~~and ~~share~~original interest discount of $692,439 ~~and~~for 5net proceeds of $1,271,000. The remaining $229,000 ~~preferred~~was received after May 31, 2022. On the date of receipt of ~~shares~~the ~~with~~proceeds, the trading price of the Company’s common stock exceeded the conversion price of the Note and the Company recognized a ~~par~~beneficial ~~value~~conversion feature of $~~0.0001~~1,498,757 ~~per~~as ~~share~~a discount on the Note and as additional paid in capital.

~~During~~In aggregate, the ~~years~~original ~~ended~~issue ~~May~~discount ~~31, 2021~~ and ~~2020,~~the ~~shares~~value of ~~common~~the ~~stock~~beneficial ~~were~~conversion ~~issued~~feature tototaled ~~related~~$2,191,196 ~~and~~which ~~non-related~~is ~~parties~~greater ~~for~~than ~~acquisitions,~~the ~~and~~principal ~~services~~amount of $1,963,439. The excess amount of $227,756 was recognized as financing expense. The ~~following~~remaining ~~table~~value ~~breaks~~of ~~out~~$1,963,439 ~~the~~was ~~issuances~~recorded byas ~~type~~a discount against the principal balance of ~~transaction~~the ~~and~~Note byto ~~related~~be ~~and~~amortized ~~non-related~~over ~~parties:~~the term of the Note.

Schedule of common stock issued
Year Ended May 31, 2021	Shares issued for Services & Other
	Shares			Value
Related Parties
David Tobias, Director		106,974		$	40,000
Jerry Cornwell, Director		106,974			40,000
Brad Herr, CFO		160,462			60,000
Total for related parties		374,410			140,000
Unrelated Parties
Services		614,838			218,244
Investment in PPK		1,520,000			972,800
Financing fee		1,200,000			1,800,000
Cancellation		(1,300,000	)		(336,875	)
Aggregate Totals May 31, 2021		2,409,248		$	2,794,169

During the year ended May 31, 2022, the Company recognized $12,910 of interest expense on the Note and $107,586 for the amortization of debt discount.

Year Ended May 31, 2020
Shares Issued for Stock Payable	Shares		Value
Related Parties		300,000	$	75,000
Unrelated Parties		208,500		52,125
Total Shares for Stock Payable		508,500		127,125
Related Parties Services
Patrick Bilton, CEO and Director		1,080,001		413,000
David Tobias, Director		120,000		41,000
Jerry Cornwell, Director		120,000		41,000
Brad Herr, CFO		240,000		93,000
Total for Related Parties		1,560,001		588,000
Unrelated Parties
Services		665,634		256,176
Acquisitions		1,400,000		1,008,000
Aggregate Totals May 31, 2020		4,134,135	$	1,979,301

At May 31, 2022, the Company has a balance owing to Steve MacDonald, of $50,000 for advance of funds. The balance was satisfied with shares of the Company’s common stock after May 31, 2022.

AtNOTE ~~May~~6 ~~31,~~– ~~2021~~RELATED ~~and~~PARTY 2020, the Company had common stock payable of $100,000 and $100,000, respectively. The balance at May 31, 2021 and 2020 relates to shares issuable to the prior owners of G4 in accordance with patent approval in the year ended May 31, 2020 (Note 2). The prior owners of G4 have requested that the Company not issue the shares at this time pending resolution by the prior owners regarding outstanding issues.TRANSACTIONS

~~The~~Related party advances represent funds advanced to the Company ~~had~~for ~~3,000,000 warrants~~working ~~outstanding~~capital. onAt May 31, 2022 and 2021., ~~The~~the ~~warrants~~Company ~~were~~had ~~issued~~advances asfrom ~~financing~~related parties ~~fees~~and onbalances ~~notes~~due ~~payable~~for toexpenses ~~AJB~~paid ~~and~~on ~~SDT~~behalf ~~(See~~of ~~Note~~the 4)Company. ~~The warrants~~These amounts are ~~exercisable~~not atsubject ~~$0.38~~to repayment terms, bear no interest, ~~per~~and ~~share~~are atexpected ~~any~~to ~~time~~be ~~over~~repaid to the related parties in common stock at a ~~three-year~~future 3date. ~~warrant~~These ~~term~~related ~~commencing~~party ontransactions ~~March~~and ~~22,~~balances are ~~2021~~set out in the following tables.

Schedule of related party transactions
	Related Party Advances at		Activity during the year ended May 31, 2022							Related Party Advances at
	May 31, 2021		Advances		Services		Payments			May 31, 2022
Related Parties
Patrick Bilton, CEO and Director
Cash Advances	$	928,414	$	257,500	$	—	$	(35,000	)	$	1,150,914
Payable for services		280,000		—		280,000		—			560,000
David Tobias, Director		80,553		1,000		—		—			81,553
Jerry Cornwell, Director		29,015		—		—		—			29,015
Total for related parties	$	1,317,982	$	258,500	$	280,000	$	(35,000	)	$	1,821,482

	Related Party Advances at		Activity during the year ended May 31, 2021						Related Party Advances at
	May 31, 2020		Advances		Services		Payments		May 31, 2021
Related Parties
Patrick Bilton, CEO and Director
Cash Advances	$	726,414	$	202,000	$	—	$	—	$	928,414
Payable for services		—		—		280,000		—		280,000
David Tobias, Director		80,553		—		—		—		80,553
Jerry Cornwell, Director		23,015		6,000		—		—		29,015
Total for related parties	$	829,982	$	208,000	$	280,000	$	—	$	1,317,982

F-17

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

InDuring ~~determining~~May ~~the~~31, ~~fair~~2022 ~~value of the shares of common stock issued for services~~ and ~~acquisitions after February 20~~2021, ~~2020,~~ the Company ~~used~~ ~~the~~paid ~~trading~~$214,200 ~~price~~(2021: of$135,000) ~~its~~to ~~common~~a ~~stock~~company asowned ~~listed~~by on the ~~OTCQB.~~CFO ~~The~~and ~~OTCQB~~at isMay an31, ~~active~~2022 ~~market~~and ~~which~~2021, ishad ~~considered a Level 1~~accounts ~~input~~payable ~~under~~to ~~fair~~him ~~value~~of ~~measurement~~$197,683 ~~accounting~~(2021: ~~guidance~~$77,779). ~~Prior~~Subsequent to ~~that~~May ~~date~~31, 2022, the Company’s ~~common~~paid ~~stock~~$150,000 ~~was~~in ~~not~~the ~~traded~~form ~~on an~~of ~~active~~shares ~~market~~of ~~and~~its ~~third-party~~common stock ~~trading volumes were low. Shares issued prior~~ to ~~February~~reduce ~~20, 2020 were valued at~~ the ~~most~~amount ~~recent cash sale~~ of the ~~common~~accounts ~~stock~~payable ofdue ~~$0.25~~to ~~which~~the ~~is considered a Level 2 input~~CFO.

~~NOTE~~During 8the –year ~~INCOME~~ended ~~TAXES~~May 31, 2022, the Company purchased inventory and equipment from PPK in which it has a 25% interest (see Note 4, Investments). The balance owing to PPK at May 31, 2022 and 2021 was $230,524 and $nil.

~~The~~NOTE ~~Company~~7 ~~did~~– ~~not~~SHARE recognize a tax provision or benefit for the years ended May 31, 2021 and 2020 due to ongoing net losses and a valuation allowance. At May 31, 2021 and 2020, the Company had net deferred tax assets which will not be realized and are fully reserved by valuation allowances. The components of the Company’s net deferred tax assets at May 31 are as follows:CAPITAL

Schedule of deferred tax assets
	2021			2020
Deferred tax asset:
Net operating loss carryforward	$	1,144,262		$	687,163
Investment		90,438			—
Intangibles		151,973			196,589
Financing fee		529,410			—
Total deferred tax assets		1,916,083			883,752
Valuation allowance		(1,916,083	)		(883,752	)
Net deferred tax assets	$	—		$	—

The authorized capital of the Company consists of 100,000,000 common shares with a par value of $0.0001 per share, and 5,000,000 preferred shares with a par value of $0.0001 per share. The following table breaks out the issuances by type of transaction and by related and non-related parties for the years ended May 31, 2022 and 2021.

At May 31, 2021, the Company had approximately $5,450,000 of Federal net operating losses available to carryforward. Operating losses of approximately $1,320,000 will expire in various amounts from 2035 through 2038, and approximately $4,130,000, will not expire but future usage of which is limited to 80% of taxable income in the year of usage. The reconciliation of the federal income tax rate and the Company’s tax provision (benefit) is as follows:

Schedule of common stock issued


				Value of Shares Issued for:
Year Ended May 31, 2022	Total Shares Issued			Stock Payable		Services		Investment and Other			Total Value
Related Parties
David Tobias, Director		79,216		$	—	$	30,000	$	—		$	30,000
Jerry Cornwell, Director		79,216			—		30,000		—			30,000
Brad Herr, CFO		118,824			—		45,000		—			45,000
Randy Lanier, Director		286,765			—		130,213		—			130,213
Jason Roth, Director		125,000			—		50,000					50,000
Rich Turasky, Director		125,000			—		50,000					50,000
Total for related parties		814,021			—		335,213		—			335,213
Unrelated Parties
Services		520,034			—		225,760		—			225,760
Investments		6,538,259			—		—		2,091,666			2,091,666
Stock Payable		400,000			100,000		—		—			100,000
Aggregate Totals May 31, 2022		8,272,314		$	100,000	$	560,973	$	2,091,666		$	2,752,639


					Value of Shares Issued for:
Year Ended May 31, 2021		Total Shares Issued			Stock Payable		Services		Investment and Other			Total Value
Related Parties
David Tobias, Director		106,974		$	—	$	40,000	$	—		$	40,000
Jerry Cornwell, Director		106,974			—		40,000		—			40,000
Brad Herr, CFO		160,462			—		60,000		—			60,000
Randy Lanier, Director		—			—		—		—			—
Total for related parties		374,410			—		140,000		—			140,000
Unrelated Parties
Services		614,838			—		218,244		—			218,244
Investment in PPK		1,520,000			—		—		972,800			972,800
Financing Fee		1,200,000			—		—		1,800,000			1,800,000
Cancellation		(1,300,000	)		—		—		(336,875	)		(336,875	)
Aggregate Totals May 31, 2021		2,409,248		$	—	$	358,244	$	2,435,925		$	2,794,169

Schedule of federal income tax rate
	2021					2020
Provision (benefit) computed using the statutory rate	$	(1,032,331	)	-21	%	$	(412,372	)	-21	%
Change in prior year estimates		—		0	%		(5,449	)	0	%
Change in valuation allowance		1,032,331		21	%		417,821		21	%
Total income tax provision (benefit)	$	—		0	%	$	—		0	%

The Company has analyzed its filing positions in all jurisdictions where it is required to file income tax returns and found no positions that would require a liability for uncertain income tax benefits to be recognized. The Company is subject to possible tax examinations for the fiscal years 2017 through 2020. Prior year tax attributes could be adjusted by taxing authorities. If applicable, the Company will deduct interest and penalties as interest expense on the financial statements.

F-18

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

~~NOTE~~At 9May –31, ~~REVENUE~~2022 ~~FROM~~and ~~CONTINUING~~2021, ~~OPERATIONS~~the Company had common stock payable of $128,785 and $100,000, respectively. The balance at May 31, 2021 relates to shares issuable to the prior owners of G4 in accordance with patent approval (See Note 3). The shares due at May 31, 2021 were issued in the year ended May 31, 2022.

~~The~~Common ~~Company~~stock ~~product~~payable ~~revenue~~for isthe ~~generated~~year ~~though~~ended ~~sales~~May of31, ~~its~~2022 ~~debudder~~was ~~products~~for ~~produced~~compensation by ~~third~~independent ~~parties~~contractors, officers, and ~~distributed~~directors byfor ~~the~~services ~~Company.~~rendered ~~The Company’s customers,~~ to ~~which~~the ~~trade credit terms are extended, consist almost exclusively of domestic companies~~Company. The ~~following~~ ~~table~~Company ~~sets~~issued ~~out~~the ~~product~~shares ~~sales and customer concentrations~~ for ~~the~~this ~~years~~compensation ~~ended~~on ~~May~~July 318, ~~2021 and 2020~~2022.

Schedule of revenues
	Years ended May 31,
	2021		2020
Debudder product revenues	$	89,186	$	129,975

The Company had 3,000,000 warrants outstanding on May 31, 2022. The warrants were issued in 2021 as financing fees on AJB/SDT Notes payable to AJB and SDT (See Note 5). The warrants are exercisable at $0.38 per share and expire on March 22, 2024.

Customer concentrations	May 31, 2021			May 31, 2020
Debudder sales
Customer A	$	34,285		$	44,197
Customer B		26,130			—
Customer C		13,675			—
Totals	$	74,090		$	44,197
% of total revenues		83	%		34	%

In determining the fair value of the shares of common stock issued for services and acquisitions, the Company uses the trading price of its common stock as listed on the OTCQB. The OTCQB is an active market which is considered a Level 1 input under fair value measurement accounting guidance.

~~All~~NOTE ~~sales~~8 ~~were~~– ~~domestic~~INCOME ~~except for $4,222 and $1,700 during the years ended May 31, 2021 and 2020, respectively, which were international.~~TAXES

NoThe ~~amounts~~Company ~~were~~did ~~owing~~not ~~from~~recognize ~~the~~a ~~Company’s~~tax ~~three~~provision ~~primary~~or ~~customers~~benefit asfor ofthe years ended May 31, 2021. Asand of2020 ~~May~~due ~~31,~~to ~~2020,~~ongoing ~~there~~net ~~were~~losses ~~$18,706~~and a valuation allowance. The reconciliation of ~~accounts~~the ~~receivable~~federal ~~from~~income ~~one~~tax ofrate and the Company’s ~~three~~tax ~~primary~~provision ~~customers.~~(benefit) is as follows:

NOTE 10 – DISCONTINUED OPERATIONS


	2022					2021
Provision (benefit) computed using the statutory rate		(604,000	)	-21	%		(1,032,000	)	-21	%
Change in prior year estimates		123,000		4	%		—		—
Change in valuation allowance		481,000		17	%		1,032,000		-21	%
Total income tax provision (benefit)		—		0	%		—		0	%

AsAt May ~~stated in Note 2~~31, in2022 ~~the~~and ~~year ended May 31,~~ 2021, the Company ~~unwound~~had ~~its~~net ~~acquisition~~deferred oftax assets ~~from~~which ~~Elevated~~will Agnot ~~Solutions,~~be ~~Inc.~~realized Asand aare ~~result~~fully ofreserved ~~the~~by ~~unwinding,~~valuation ~~the net income (loss) from the Elevated business segment is included in Discontinued Operations in the statements of operations for all periods presented~~allowances. AsThe acomponents ~~result~~ of the ~~unwinding, the~~ Company’s ~~reversed~~net ~~the~~deferred ~~acquisition~~tax ~~of intangible~~ assets ~~(see~~at ~~Note~~May ~~2),~~31 ~~cancelled~~are ~~1,300,000~~as ~~out of the 1,400,000 shares of common stock that were issued in the acquisition, and paid a $10,000 walk-away fee to the prior owners.~~follows:

Discontinued operations operating results for the year ended May 31, 2021 compared to 2020 are reflected in the following table.

Schedule of deferred tax assets
	2022			2021
Net operating loss carryforward	$	2,079,000		$	1,144,000
Investment		90,000			90,000
Intangibles		152,000			152,000
Financing fee		75,000			529,000
Total deferred tax assets	$	2,396,000		$	1,915,000
Valuation allowance		(2,396,000	)		(1,915,000	)
Net deferred tax asset	$	—		$	—

OPERATING RESULTS
	Year Ended			Year Ended
	May 31, 2021			May 31, 2020
Revenue	$	75,217		$	197,916
Cost of revenue	$	66,243			192,077
Amortization	$	13,125			—
Gross profit		(4,151	)		5,839
Loss on discontinued operations		10,000			—
Total gain (loss) from discontinued operations	$	(14,151	)	$	5,839

At May 31, 2022, the Company had approximately $9.9 million of Federal net operating losses available to carryforward. Operating losses of approximately $1.3 million will expire in various amounts from 2035 through 2038, and approximately $8.6 million, will not expire but future usage of which is limited to 80% of taxable income in the year of usage.

~~NOTE~~The 11Company –has ~~IMPACT~~analyzed OFits ~~COVID-19~~filing positions in all jurisdictions where it is required to file income tax returns and found no positions that would require a liability for uncertain income tax benefits to be recognized. The Company is subject to possible tax examinations for the fiscal years 2018 through 2021. Prior year tax attributes could be adjusted by taxing authorities.

In March 2020, COVID-19 was declared a pandemic by the World Health Organization and the Centers for Disease Control and Prevention. Its rapid spread around the world and throughout the United States prompted many countries, including the United States, to institute restrictions on travel, public gatherings and certain business operations. These restrictions significantly disrupted economic activity in the United States and Worldwide. As of May 31, 2021 and through the date of filing of this Form 10-K, the disruption did not materially impact the Company’s financial statements.

The effects of the continued outbreak of COVID-19 and related government responses could include extended disruptions to supply chains and capital markets, reduced labor availability and a prolonged reduction in economic activity. These effects could have a variety of adverse impacts to the Company, including our ability to operate. As of May 31, 2021 there were no material adverse impacts to the Registrants’ operations due to COVID-19.

F-19

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

~~The~~NOTE ~~economic~~9 ~~disruptions~~– ~~caused~~REVENUE byFROM ~~COVID-19~~CONTINUING could also adversely impact the impairment risks for certain long-lived assets. Management evaluated these impairment considerations and determined that no such impairments occurred as of May 31, 2021.OPERATIONS

~~NOTE~~In 12the –years ~~SUBSEQUENT~~ended ~~EVENTS~~May 31, 2022 and 2021, the Company product revenue was generated primarily through sales of its patented debudder products manufactured by third parties and distributed by the Company. The Company’s customers, to which trade credit terms are extended, consist primarily of domestic companies. The following table sets out product sales and customer concentrations for the years ended May 31, 2022 and 2021.

~~AOK~~All ~~Ventures~~sales ~~LLC~~were ~~(“AOK”).~~domestic Onexcept ~~August~~for 19$23,760 and ~~2021~~$4,222 in ~~PPK~~international ~~(of~~sales ~~which~~during the ~~Company~~years ~~owns~~ended ~~10% at~~ May 31, ~~2021)~~2022 ~~acquired assets from AOK comprising a commercial kitchen facility~~ and ~~also~~2021, ~~entered~~respectively. ~~into~~Debudder ~~subleases~~sales oninclude ~~the kitchen facility in Tulsa~~$3,750 ~~Oklahoma~~of ~~and~~revenue ~~a distribution~~from ~~facility~~soil ~~in Oklahoma City, Oklahoma~~additives. ~~The~~Debudder ~~purchase~~sales ~~price~~ for the ~~assets,~~year ~~license~~ended ~~rights,~~May ~~and subleases was $2~~31,~~500,000. A~~ ~~portion~~2022 ofincluded ~~this amount aggregating~~ $23,~~150,000~~750 ~~was paid by the Company through issuance of 5,972,222 shares of its common stock valued~~from atsoil 0additives.36 ~~per~~There ~~share.~~were Inno ~~consideration~~soil ~~for~~additive ~~funding~~sales ~~the acquisition~~ for ~~PPK,~~ the ~~Company’s~~year ~~interest~~ended inMay ~~PPK~~31, ~~was increased to 25%~~2021.

Desert Hot Springs. On August 20, 2021, the Company agreed to manage a cannabis oil extraction facility in Desert Hot Springs, California. The facility is being acquired by a third party and will be leased to a new entity that has retained the Company to manage the facility. The Company’s management services agreement will commence as soon as practicable after the ownership of the facility transfers to the third-party buyer and the lease to the new entity commences. Operation of the facility will require the new entity lessee to obtain the appropriate California cannabis licenses. The Company is currently working with the third-party buyer of the facility, and the new entity lessee to complete due diligence on the acquisition, prepare definitive agreements, and commence the cannabis license transfer process from the prior owner.

Schedule of revenues
	Year ended May 31,
	2022			2021
Debudder product revenues	$	147,473		$	89,186
Customer concentrations
Debudder sales
Customer A	$	37,900		$	13,675
Customer B		23,760			—
Customer C	$	14,680		$	34,285
Customer D		64,550			26,130
Totals	$	140,890		$	74,090
% of total debudder revenues		96	%		83	%

~~The~~During ~~Company~~in ~~also~~the ~~intends~~year toended ~~borrow~~May ~~$500~~31,~~000~~ 2022, in addition to revenue from debudder sales, the ~~third-party~~Company ~~buyer~~generated ofrevenue ~~the~~from ~~facility~~its ~~for~~operations ~~working~~in ~~capital~~Colorado. Colorado operations consist of manufacture and todistribution ~~fund~~of aproducts ~~new~~containing ~~generator~~cannabis derived ingredients. The Colorado operations tobegan ~~power~~operating near the ~~site~~end ~~pending~~of ~~delivery~~the offiscal ~~permanent~~year ~~power~~and tototal ~~the~~sales ~~facility~~revenues bywere ~~the~~$25,352. ~~local~~The ~~utility~~California ~~company~~operations did not have revenue as of May 31, 2022.

The third-party buyer’s acquisition is expected to close in September 2021 and the Company expects to begin operating the facility shortly thereafter.

Agreement with Borders Consulting LLC. On June 9, 2021, the Company entered into an agreement with Borders Consulting LLC (“Borders”), an unrelated third-party vendor, to provide consulting services in connection with corporate finance relations, introductions to funding sources, and to enhance the Company’s visibility in the financial markets. The agreement was for a three-month term at compensation of $50,000 per month payable in cash plus common stock aggregating 250,000. The agreement is terminable at any time by either party on 10 days written notice.

F-20

NOTE 10 – DISCONTINUED OPERATIONS

In the year ended May 31, 2021, the Company unwound its acquisition of assets from Elevated Ag Solutions, Inc. As a result of the unwinding, the net income (loss) from the Elevated business segment is included in Discontinued Operations in the statements of operations for all periods presented. As a result of the unwinding, the Company reversed the acquisition of intangible assets, cancelled 1,300,000 out of the 1,400,000 shares of common stock that were issued in the acquisition, and paid a $10,000 walk-away fee to the prior owners. Discontinued operations operating results for the year ended May 31, 2021 are reflected in the following table.

Schedule of discontinued operations
	Year Ended May 31, 2021
Revenue	$	75,217
Cost of revenue		66,243
Amortization		13,125
Gross profit		(4,151	)
Loss on discontinued operations		10,000
Net Loss From Discontinued Operations	$	(14,151	)

NOTE 11 INVENTORY

At May 31, 2022 and 2021, inventory consists of the following:

Schedule of inventory
	2022		2021
Debudder products	$	24,794	$	28,159
Raw material - biomass		21,868		—
Raw material - distillate		76,916		—
Finished goods		73,301		—
Total	$	197,059	$	28,159

At May 31, 2022, raw material – biomass is on consignment from a third-party company with which the Company has a license agreement. Under the agreement, the Company obtains biomass materials from third party from which produces the cannabis products. When the product is sold, the Company is reimbursed for its manufacturing costs. The Company also receives 85% of net profits remaining after reimbursement. During the year May 31, 2022, due to the start up nature of the manufacturing, no net revenues have been earned on these products.

F-21

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12 LEASE

On January 1, 2022, the Company signed a lease for its office and facilities located in Denver, Colorado for a five year term. Monthly lease payments start at $6,000 and escalate to $7,293 in year five. Upon signing the lease, the Company recognized a lease liability and a right of use asset of $308,127 based on the two-year payment stream discounted using an estimated incremental borrowing rate of 10.0%. At May 31, 2022, the remaining lease term is 4.5 years. As of May 31, 2022, total future lease payments are as follows:

Schedule of future lease payments
For the year ended May 31,
2023	$	73,500
2024		77,175
2025		81,033
2026		85,085
2027		51,052
Total		367,845
Less imputed interest		(73,718)
Net lease liability		294,127
Current portion		46,761
Long-term portion	$	247,366

For the year ended May 31, 2022, rent expense of $32,858 was recognized for this lease.

NOTE 13 – COMMITMENT AND CONTINGENCIES

See Notes 4 and 12 for commitments related to royalties, earn-out provisions, and leases.

The Company and PPK are plaintiffs in lawsuit against Country Cannabis, LLC of Yale, Oklahoma for trademark infringement for the use of the name “Country Cannabis”. The lawsuit was filed with the Payne County, Oklahoma Courts on February 7, 2022. The Company has motioned the Court for summary judgment in this matter and for legal fees. The motion for summary judgement is currently pending before the Court. As of May 31, 2022, management believes it will be successful in the matter however is unable to estimate amounts, if any, they could receive in the final judgment.

F-22

MJ HARVEST, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 14 – SUBSEQUENT EVENTS

Related Party Advances and Payables Conversion

In July 2022, related parties to the Company, consisting of officers, directors, and affiliates converted an aggregate of $1,971,482 of advances into shares of the Company’s common stock priced at $0.187 per share which was the trading price of the Company’s stock on the date of conversion. This conversion resulted in issuance of 10,542,682 shares of common stock.

Note Payable

On June 17, 2022, the Company entered into an agreement with 1800 Diagonal Lending, LLC. The Company issued convertible note to Diagonal with a principal amount of $103,750. The note bears interest at 10% and has a term of one year when payment of principal and interest is due. After 180 days, the note is convertible into shares of the Company's common stock based on a discounted market price calculated on the conversion date.

Acquisition of California Assets

On July 18, 2022, the Company acquired manufacturing equipment and two cannabis licenses for a cannabis manufacturing and distribution business in Cathedral City, California. The Company paid $1,000,000 for the acquisition by issuance of an unsecured non-interest bearing note payable in 24 monthly installments. The Company is currently operating the California facility under a management services agreement pending transfer of the licenses into the Company’s name.

California Lease Agreement

On July 18, 2022, the Company signed a five-year lease agreement to occupy a manufacturing and distribution facility located in Cathedral City, California. The five-year lease agreement also includes an option for the Company to purchase the building at any time during the lease term. Monthly payments on the lease are $72,917.

Merger with Cannabis Sativa, Inc.

On August 8, 2022, the Company entered into an Agreement of Merger and Plan of Reorganization dated August 8, 2022 with Cannabis Sativa, Inc. (“CBDS”), to be effective on the first business day following approval of the Merger by the shareholders of MJHI and CBDS. The Merger Agreement provides for the merger of MJHI with and into CBDS, with CBDS as the surviving entity. Under the agreement, the Company’s shareholders will receive 2.7 shares of CBDS common stock for each one share of the Company’s common stock held immediately prior to the merger. Following the Merger, the shareholders of MJHI will hold approximately 72% of the total outstanding shares of common stock of the surviving company, and the shareholders of CBDS will hold approximately 28% of the total outstanding common shares of the surviving company.

F-23

Filing Compare · MJ Harvest, Inc.