UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

———————

FORM 10-Q

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x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
	ACT OF 1934
For the quarterly period ended: March 31, 2016
or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
	ACT OF 1934
For the transition period from: _____________ to _____________

———————

Cannabis Sativa, Inc.

 (Exact name of registrant as specified in its charter)

———————

NEVADA	000-53571	20-1898270
(State or Other Jurisdiction	(Commission	(I.R.S. Employer
of Incorporation)	File Number)	Identification No.)

1646 W. Pioneer Blvd., Suite 120, Mesquite, Nevada  89027

(Address of Principal Executive Office) (Zip Code)

(702) 346-3906

(Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

———————

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒ Yes ☐ 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	☐	Smaller reporting company	☒

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

The number of shares of the issuer's Common Stock outstanding as of May 16, 2016 is 17,484,738.

CANNABIS SATIVA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
	Unaudited
	March 31,			December 31,
	2016			2014
Assets
Current Assets
Cash and Cash Equivalents	$	13,798		$	10,356
Digital Currency		18,267			5,203
Accounts Receivable, Net		3,537			4,190
Employee Advance		44			44
Inventories		29,837			24,937
Investment in Joint Venture		35,000			35,000
Total Current Assets		100,483			79,730
Property and Equipment, Net		4,280			4,504
Intangible Assets, Net		2,891,359			2,904,121
Investment		9,760			9,760
Due from Related Parties		248,182			248,182
Deposits		4,236			4,236
Total Assets	$	3,258,300		$	3,250,533
Liabilities and  Stockholders' Equity
Current Liabilities:
Accounts Payable and Accrued Expenses	$	424,480		$	344,395
Due to Related Parties - Short Term		96,412			27,427
Total Liabilities		520,892			371,822
Stockholders' Equity:
Preferred stock $0.001 par value; 5,000,000 shares authorized;
428,585 issued and outstanding		428			428
Common stock $0.001 par value; 45,000,000 shares authorized;
17,404,738 and 17,374,738 shares issued and outstanding, respectively		17,405			17,375
Stock Subscriptions Payable		153,201			14,303
Additional Paid-In Capital		56,980,054			56,938,810
Accumulated Deficit		(54,414,574	)		(54,093,099	)
Total Cannabis Sativa, Inc. Stockholders' Equity		2,736,514			2,877,817
Non-Controlling Interest		894			894
Total Stockholders' Equity		2,737,408			2,878,711
Total Liabilities and Stockholders' Equity	$	3,258,300		$	3,250,533
"The accompanying notes are an integral part of these condensed consolidated financial statements"

CANNABIS SATIVA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended March 31,	2016			2015
Revenues	$	15,087		$	1,102
Cost of Revenues		579			1,160
Gross Profit (Loss)		14,508			(58	)
General and Administrative Expenses		331,927			1,780,163
Loss from Operations		(317,419	)		(1,780,221	)
Interest Expense		4,056			7,861
Loss Before Income Taxes		(321,475	)		(1,788,082	)
Income Taxes		—			—
Net Loss for the Period		(321,475	)		(1,788,082	)
Loss Attributable to Non-Controlling Interest		—			—
Net Loss Attributable To Cannabis Sativa, Inc.	$	(321,475	)	$	(1,788,082	)
Net Loss for the Period per Common Share:
Basic & Diluted	$	(0.02	)	$	(0.11	)
Weighted Average Common Shares Outstanding:
Basic & Diluted		17,385,947			15,929,210
"The accompanying notes are an integral part of these condensed consolidated financial statements"

CANNABIS SATIVA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31,	2016			2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss for the Period	$	(321,475	)	$	(1,788,082	)
Adjustments to Reconcile Net Loss for the Period to Net Cash
Used in Operating Activities:
Depreciation and Amortization		12,986			38,614
Stock Issued for Services		179,624			1,578,250
Contributed Capital		—			7,489
Amortization of Prepaid		—			41,667
Imputed Interest on Loans		548			—
Changes in assets and liabilities:
Digital Currency		(13,064	)		—
Accounts Receivable		653			—
Inventories		(4,900	)		40
Employeee Advances		—			13
Accounts Payable and Accrued Expenses		80,085			33,099
Due to Related Parties - Short Term		15,000			—
Net Cash Used in Operating Activities:		(50,543	)		(88,910	)
Cash Flows from Investing Activities:
Purchase of Fixed Assets and Intangibles		—			(8,410	)
Net Cash Used in Investing Activities:		—			(8,410	)
Cash Flows from Financing Activities:
Payments to Related Parties		(2,515	)		(40,345	)
Proceeds from Related Parties		56,500			125,000
Net Cash Provided by Financing Activities:		53,985			84,655
NET CHANGE IN CASH AND CASH EQUIVALENTS		3,442			(12,665	)
Cash and Cash Equivalents - Beginning of Period		10,356			25,994
Cash and Cash Equivalents - End of Period	$	13,798		$	13,329
Supplemental Disclosure of Cash Flow Activities:
Interest	$	—		$	—
Income taxes	$	—		$	—
Supplemental Disclosures of Non Cash Activities:
Unrealized Gain on Available for Sale Securities	$	—		$	4,822
"The accompanying notes are an integral part of these condensed consolidated financial statements"

CANNABIS SATIVA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2016 and 2015

 (Unaudited)

1. Summary of Significant Accounting Policies and Use of Estimates:

Presentation of Interim Information:

The condensed consolidated financial statements included herein have been prepared by Cannabis Sativa, Inc., formerly named Ultra Sun Corp. ("we", "us", "our" or "Company"), without audit, pursuant to the rules and regulations of the United States Securities and Exchange Commission ("SEC") and should be read in conjunction with the annual report on Form 10-k filed with the SEC May 6, 2016.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted, as permitted by the SEC, although we believe the disclosures, which are made, are adequate to make the information presented not misleading. Further, the condensed financial statements reflect, in the opinion of management, all normal recurring adjustments necessary to present fairly our financial position at March 31, 2016, and the results of our operations and cash flows for the periods presented.

Interim results are subject to significant seasonal variations and the results of operations for the period ended March 31, 2016 are not necessarily indicative of the results to be expected for the full year.

Nature of Corporation:

We were incorporated under the laws of Nevada in November 2004 as Ultra Sun Corp. On November 13, 2013, we changed our name to Cannabis Sativa, Inc.   Our wholly-owned subsidiary Kush was acquired by us in June 2014 in exchange for shares of our common stock.  Our wholly-owned subsidiary Wild Earth Naturals, Inc. ("Wild Earth") was acquired by us in July 2013 in exchange for shares of our common stock.  The acquisition of Kush resulted in a change of control of the Company and at or after the closing of the acquisition of Kush, the persons designated by Kush became the officers and directors of the Company.  From our inception through September 30, 2013 we were engaged in the tanning salon business and operated a tanning salon in Saratoga Springs, Utah under the name "Sahara Sun Tanning."  As a result of our acquisition of Wild Earth in July 2013, we became engaged in the herbal skin care products business.  On September 30, 2013 we sold the assets of the tanning salon business to a third party.  As a result of our acquisition of Kush in June 2014, along with our Wild Earth operations we are now engaged in the developing and promoting of natural cannabis products.  On November 2, 2015, Kush was spun out of the Company.

Use of Estimates:

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Accounts Receivable:

We estimate credit loss reserves for accounts receivable on an individual receivable basis. A specific impairment allowance reserve is established based on expected future cash flows and the financial condition of the debtor.  We charge off customer balances in part or in full when it is more likely than not that we will not collect that amount of the balance due.  We consider any balance unpaid after the contract payment period to be past due.  At March 31, 2016 the company has established an allowance for doubtful accounts of $-0-.

CANNABIS SATIVA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2016 and 2015

 (Unaudited)

Inventory:

The Company calculates inventory using the average cost method to value inventory.  Inventory cost includes those costs directly attributable to the product before sale.

Fair Value of Financial Instruments:

The estimated fair values for financial instruments are determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The carrying amounts of accounts payable, accrued liabilities, and notes payable approximate fair value given their short term nature or effective interest rates.

Cash and Cash Equivalents:

For financial accounting purposes, cash and cash equivalents are considered to be all highly liquid investments purchased with an initial maturity of three (3) months or less.

Earnings per Share:

Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the period and contains no dilutive securities. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity.  As of March 31, 2016 and 2015, the Company has no outstanding potentially dilutive securities.

Revenue Recognition:

The Company recognizes revenue from product sales or services rendered when the following four revenue recognition criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the selling price is fixed or determinable, and collectability is reasonably assured.

Digital Currencies Translations and Re-measurements

The Company accounts for digital currencies, which it considers to be an operating asset, at their initial cost and subsequently re-measures the carrying amounts of digital currencies it owns at each reporting date based on their current fair value. The changes in the fair value of digital currencies are included as a component of income or loss from operations. The Company currently classifies digital currencies as a current asset. The Company obtains the equivalency rate of hempcoins to bitcoins to USD from Coindesk. The equivalency rate obtained from Coindesk represents a generally well recognized quoted price in an active market for bitcoins, which market and related database are accessible to the Company on an ongoing basis. The Bitcoin Price Index was $415.16 as of March 31, 2016.

Intangible Assets:

Intangible assets are comprised of patents, trademarks, the Company's "CBDS.com" website domain and intellectual property rights.  The patent is being amortized using the straight-line method over its economic life, which is estimated to be twenty (20) years.  The trademark, which is still in the application phase, is expected to have an indefinite useful life.  The CBDS.com website is expected to have an indefinite useful life.  The intellectual property rights are being amortized using the straight-line month over its economic life, which is estimated to be (20) years.

CANNABIS SATIVA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2016 and 2015

 (Unaudited)

Income Taxes:

The Company estimates the annual tax rate based on projected taxable income for the full year and records a quarterly income tax provision in accordance with the anticipated annual rate. As the year progresses, we refine the estimates of the year's taxable income as new information becomes available, including year-to-date financial results. This continual estimation process can result in a change to the expected effective tax rate for the year. When this occurs, the Company adjusts the income tax provision during the quarter in which the change in estimate occurs so that the year-to-date provision reflects the expected annual tax rate. Significant judgment may be required in determining the Company's effective tax rate and in evaluating our tax positions.

The effective income tax rate of 0% for the periods ended September 30, 2015 and 2014 differed from the statutory rate, due primarily to net operating losses incurred by the Company in the respective periods.  For the three months ended March 31, 2016 a tax benefit of approximately $48,221 would have been generated.  For the three months ended March 31, 2015 a tax benefit of approximately $268,212 would have been generated.  However, all benefits have been fully offset through an allowance account due to the uncertainty of the utilization of the net operating losses. As of March 31, 2016 the Company had net operating losses of approximately $321,475 resulting in a deferred tax asset of approximately $48,221.  As of March 31, 2015 the Company had net operating losses of approximately $1,788,082 resulting in a deferred tax asset of approximately $268,212.

The Company has established a valuation allowance in the full amount of the deferred tax asset due to the uncertainty of the utilization of operating losses in future periods.

Pending Accounting Pronouncements:

There have been no recent accounting pronouncements issued which are expected to have a material effect on the Company's financial statements.

2.  Eden Holdings LLC

During the quarter ended September 30, 2014, the Company created Eden Holdings LLC.  The purpose of the entity is to hold the intellectual property of Cannabis Sativa, Inc.  As of March 31, 2016 there has been no activity in the LLC.

CANNABIS SATIVA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2016 and 2015

 (Unaudited)

3.   Fair Value Measurements

We adopted ASC Topic 820 for financial instruments measured at fair value on a recurring basis. ASC Topic 820 defines fair value, establishes a framework for measuring fair value in accordance with accounting principles generally accepted in the United States and expands disclosures about fair value measurements.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:

· Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;

· Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and

· Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

The estimated fair values for financial instruments are determined at discrete points in time based on relevant market information.  These estimates involve uncertainties and cannot be determined with precision.  The carrying amounts of accounts receivable, inventory, notes payable, accounts payable, accrued liabilities approximate fair value given their short term nature or effective interest rates.  We measure certain financial instruments at fair value on a recurring basis.  As of March 31, 2016, assets and liabilities measured at fair value on a recurring basis were as follows:

	Total		Level 1		Level 2		Level 3
Assets:
Digital Currency	$	18,267	$	18,267	$	-	$	-
Total assets measured at fair value	$	18,267	$	18,267	$	-	$	-
Liabilities:	$	-	$	-	$	-	$	-
Total liabilities measured at fair value	$	-	$	-	$	-	$	-

CANNABIS SATIVA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2016 and 2015

 (Unaudited)

4.  Hempcoins

At March 31, 2016, the Company has possession of 110,000,000 hempcoins.  Hempcoins are reported as digital currency.  Every 10 hempcoins are backed by 1 share of Rocky Mountain Inc (RMTN).  At March 31, 2016 the value of hempcoins was $18,267 computed by converting first to bitcoin and then to US Dollars. (See Note 1).

5.  Related Parties

During the three months ended March 31, 2016 the Company received additional short-term advances from related parties and officers of the Company to cover operating expenses in the amount of $56,500.  As of March 31, 2016, net advances to the Company were $96,412.  The Company has imputed interest on these sums at the rate of 5% per annum and has recorded interest expense related to these balances in the amount of $548.  Because the related parties do not expect the imputed interest to be repaid, the interest has been recorded as a contribution of capital during the three months ended March 31, 2016.

The Company also has $248,182 that is due from Kush, a related party.  Payment is not expected currently.

6.  Common Stock

During the three months ended March 31, 2016, the Company's board of directors authorized the issuance of 5,000 shares of its common stock to each of its seven (7) board of directors for their service through March 31, 2016.  The Company recorded $31,388 in board of director fees on its statement of operations for the three months ended March 31, 2016.  As of March 31, 2016, the stock has yet to be issued.

During the three months ended March 31, 2016, the Company's board of directors authorized the issuance of 33,333 shares of its common stock to a consultant for their service through March 31, 2016.  The Company recorded $29,040 in consulting fees on its statement of operations for the three months ended March 31, 2016.  As of March 31, 2016, the stock has yet to be issued.

During the three months ended March 31, 2016, the Company's board of directors authorized the issuance of 87,500 shares of its common stock to two (2) board of directors and two (2) consultants for their service through March 31, 2016.  The Company recorded $78,470 in professional fees on its statement of operations for the three months ended March 31, 2016.  As of March 31, 2016, the stock has yet to be issued.

During the three months ended March 31, 2016, the Company's board of directors authorized the issuance of 30,000 shares to a consultant for services to be provided during through March 31, 2016.  The value of the issuance was determined to be $40,726.

CANNABIS SATIVA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2016 and 2015

 (Unaudited)

7. Hi Brands International Inc. – Centuria Foods Agreement

On February 6, 2015, the Company formed Hi Brands International Inc., a Nevada Corporation and wholly owned subsidiary of Cannabis Sativa, Inc.

On February 25, 2015, the Company through its wholly owned subsidiary Hi Brands International, Inc. (jointly referred to hereinafter as "Cannabis Sativa"), entered into a Purchase, Supply and Joint Venture Agreement (the "Agreement"), with Centuria Natural Foods, Inc. ("Centuria") whereby Cannabis Sativa will market Centuria's proprietary CBD (Cannabidiol) Rich Hemp Oil products (the "Products").

The initial term of the Agreement is one year which may be renewed for additional one year periods upon the mutual agreement of the parties.  Within the first 90 days of the initial term of the Agreement, Cannabis Sativa shall order at least 5,000 units of Product.  Thereafter, Cannabis Sativa shall order at least 5,000 units of Product per month with the additional requirement that Cannabis Sativa order a minimum of 55,000 units of Product during the first 12 months of the Agreement.  Fifty percent of all gross revenue generated by the sale of the Products will be paid to Cannabis Sativa and fifty percent will be paid to Centuria.

As of March 31, 2016, there has not been any activity in Hi Brands International Inc. other than the execution of the above agreement.  The Company has not ordered any product under this agreement as of March 31, 2016.

8.  Going Concern Considerations

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The Company has incurred net losses since inception. As reported in the financial statements, the Company has an accumulated deficit which 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 on its ability to raise adequate capital to fund operating losses until it is able to engage in profitable business operations. To the extent financing is not available, the Company may not be able to, or may be delayed in, developing its services and meeting its obligations. The Company will continue to evaluate its projected expenditures relative to its available cash and to evaluate additional means of financing in order to satisfy its working capital and other cash requirements. The accompanying financial statements do not reflect any adjustments that might result from the outcome of these uncertainties.

CANNABIS SATIVA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2016 and 2015

 (Unaudited)

9.   Legal Proceedings

On August 26, 2015 the Company filed a complaint in the District Court of Clark County, Nevada against 3 (three) individuals and Colonial Stock Transfer Company, Inc., a Utah Corporation, seeking declaratory relief for the cancelation of common shares of the Company issued in connection with a consulting agreement.  The complaint alleges a breach of the consulting agreement by the defendants.  In addition to seeking  a cancellation of shares, the complaint seeks general, consequential and punitive damages and costs in unspecified amounts. At March 31, 2016 the complaint was settled and a mutual release was signed by the individuals in the suit.  Signature from an officer of the Company followed in April 2016.

10.   Subsequent Events

Shareholders of Cannabis Sativa, Inc. received 4.32 shares of Kush for every share of ownership of common stock in the Company as a shareholder dividend on August 25, 2015.  This was completed on November 2, 2015.

In accordance with the Kush spin off agreement, the Company is to issue 1,250,000 shares of its common shares to Kush.  In return, for the 9% equity in Kush the Company shall receive 14,260,436 shares of Kush.

On November 2, 2015, the Company announced that it will pay a special stock dividend of 1.5 restricted common shares for each share held as of the record date of November 16, 2015.  The holding period for these shares is 6 months from the issue date to shareholders of record.

The Company has also submitted its application to be listed on NASDAQ.

Subsequent to March 31, 2016, the Company issued 80,000 shares of its common stock.  50,000 shares were issued to a consultant and 30,000 shares were issued to the Company's Joint Venture Partner.

On April 13, 2016 the Company formally signed a mutual release and settlement regarding legal proceedings noted in Note 9.

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations.

Results of Operations

Three Months Ended March 31, 2016 Compared With Three Months Ended March 31, 2015

Net revenue for the three months ended March 31, 2016 and 2015 was $15,087 and $1,102, respectively. Cost of revenues for the three months ended March 31, 2016 and 2015 was $579 and $1,160, respectively. Gross profit (loss) for the three months ended March 31, 2016 and 2015 was $14,508 and ($58), respectively.  Net loss for the three months ended March 31, 2016 was $321,475 compared to net loss of $1,788,082 for the three months ended March 31, 2015.

Total operating expenses were $331,927 for the three months ended March 31, 2016 compared to $1,780,163 for the three months ended March 31, 2015.  The significant decrease in general and administrative expenses was attributable to common stock grants for compensation and consulting services during the three months ended March 31, 2015.   Other general and administrative expenses consisted primarily of professional fees, payroll expenses, rent and transfer agent fees. Other expenses for the three months ended March 31, 2016 were interest expense of $4,056 compared to interest expense of $7,861 for the three months ended March 31, 2015.

Liquidity and Capital Resources

Our operations used approximately $50,543 in cash for the three months ended March 31, 2016. Investing activities used $-0- for the three months ended March 31, 2016 and financing activities provided cash of $53,985 for the three months ended March 31, 2016. Cash required during the three months ended March 31, 2016, came principally from cash proceeds from related parties in the amount of $56,500.

Our operations used approximately $88,910 in cash for the three months ended March 31, 2015. Investing activities used cash of $8,410 for the three months ended March 31, 2015 and financing activities provided cash of $84,655 for the three months ended March 31, 2015. Cash required during the three months ended March 31, 2016, came principally from cash proceeds from related parties in the amount of $125,000.

The accompanying condensed 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 loss of $321,475 and $1,788,082, respectively, for the three months ended March 31, 2016 and 2015 and had an accumulated deficit as of March 31, 2016.  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 convertible debt.  It will be important for the Company to be successful in its efforts to raise capital in this manner if it is going to be able to further its business plan in an aggressive manner.  Raising capital in this manner will cause dilution to current shareholders. As mentioned before, for the immediate needs of our current operations, we anticipate continuing to fund operations through management and shareholder loans. There can be no assurance that management and shareholders will continue to loan the Company funds.  These factors raise substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Off Balance Sheet Arrangements

None

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not required.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

Under the supervision and with the participation of our management including our chief executive officer and our chief financial officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")) as of the end of the period covered by this report. Based upon that evaluation, our chief executive officer and our chief financial officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were not effective such that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and (ii) accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding disclosure.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. 

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.

On August 26, 2015, the Company filed a complaint in the District Court of Clark County, Nevada, Department No. XXVIII against Jeff W. Holmes, Greg W. Holmes, Kevin J. Asher and Colonial Stock Transfer Company, Inc., a Utah Corporation, seeking declaratory relief for the cancelation of common shares of the Company issued in connection with a consulting agreement.  The complaint alleges generally a breach of the consulting agreement by the defendants.  In addition to seeking a cancellation of shares, the complaint seeks general, consequential and punitive damages and costs in unspecified amounts.

Item 1A. Risk Factors.

See the risk factors discussed in Item 1A. of our Annual Report on Form 10-K for the year ended December 31, 2015.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None, other than as previously reported on Form 8-K.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.

The following documents are included as exhibits to this report:

(a) Exhibits

Exhibit Number	SEC Reference Number	Title of Document	Location
3.1	3	Articles of Incorporation	Incorporated by Reference(1)
3.3	3	Bylaws	Incorporated by Reference(1)
31.1	31	Section 302 Certification of Principal Executive Officer	This Filing
31.2	31	Section 302 Certification of Principal Financial Officer	This Filing
32.1	32	Section 1350 Certification of Principal Executive Officer	This Filing
32.2	32	Section 1350 Certification of Principal Financial Officer	This Filing
101.INS(2)		XBRL Instance Document	This Filing
101.SCH(2)		XBRL Taxonomy Extension Schema	This Filing
101.CAL(2)		XBRL Taxonomy Extension Calculation Linkbase	This Filing
101.DEF(2)		XBRL Taxonomy Extension Definition Linkbase	This Filing
101.LAB(2)		XBRL Taxonomy Extension Label Linkbase	This Filing
101.PRE(2)		XBRL Taxonomy Extension Presentation Linkbase	This Filing

(1) Incorporated by reference to Exhibits 3.01 and 3.02 of the Company's Registration Statement on Form 10 filed January 28, 2009.

(2) 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.

SIGNATURES

Pursuant to the requirements 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.

Cannabis Sativa, Inc.

Date:           May 16, 2016

By:  /s/ Mike Gravel

Mike Gravel Chief Executive Officer

(Principal Executive Officer)

By:  /s/ Catherine Carroll

Catherine Carroll, Chief Financial Officer

(Principal Financial and Accounting Officer)