0001761088-19-000054.txt : 20190619 0001761088-19-000054.hdr.sgml : 20190619 20190618184044 ACCESSION NUMBER: 0001761088-19-000054 CONFORMED SUBMISSION TYPE: 10-Q/A PUBLIC DOCUMENT COUNT: 69 CONFORMED PERIOD OF REPORT: 20190618 FILED AS OF DATE: 20190619 DATE AS OF CHANGE: 20190618 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STWC. Holdings, Inc. CENTRAL INDEX KEY: 0001400683 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT CONSULTING SERVICES [8742] IRS NUMBER: 208980078 STATE OF INCORPORATION: UT FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10-Q/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-52825 FILM NUMBER: 19904739 BUSINESS ADDRESS: STREET 1: 1350 INDEPENDENCE ST. STREET 2: SUITE 300 CITY: LAKEWOOD STATE: CO ZIP: 80215 BUSINESS PHONE: (303) 736-2442 MAIL ADDRESS: STREET 1: 1350 INDEPENDENCE ST. STREET 2: SUITE 300 CITY: LAKEWOOD STATE: CO ZIP: 80215 FORMER COMPANY: FORMER CONFORMED NAME: Strainwise, Inc. DATE OF NAME CHANGE: 20141008 FORMER COMPANY: FORMER CONFORMED NAME: 4th Grade Films Inc DATE OF NAME CHANGE: 20070523 10-Q/A 1 stwc10qa043019.htm STWC HOLDINGS, INC. 10-Q AMENDMENT APRIL 30, 2019

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q/A
Amendment No. 1

X Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act Of 1934

For the quarterly period ended April 30, 2019

 Transition Report Under Section 13 or 15(d) of the Securities Exchange Act Of 1934

For the transition period from __________ to __________

 Commission file number: 000-52825
 
                                                                STWC HOLDINGS, INC 
(Exact name of registrant as specified in its charter)
Colorado
20-8980078
(State or other jurisdiction of
(I.R.S. Employer Identification No.)
Incorporation or organization)
 
   
1350 Independence St., Suite 300
 
Lakewood, CO
80215
(Address of principal executive offices)
(Zip Code)

Securities Registered pursuant to section 12(b) of the Act:  None

Indicate by check mark whether the issuer (1) has filed all reports required to be filed by section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the 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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes [] No [x]

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

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

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☒
 
Indicate the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 34,220,089 shares of common stock as of April 30, 2019.


EXPLANATORY NOTE

This Amendment No. 1 to the Quarterly Report on Form 10-Q/A (this “Amendment”) is being filed by STWC Holdings, Inc. (the “Company”) to amend the Company’s Quarterly Report on Form 10-Q for the quarter ended April 30, 2019, which was originally filed with the Securities and Exchange Commission (the “SEC”) on June 14, 2019 (the “Quarterly Report”).

The Company is filing this Amendment solely to include the XBRL files which were striped from the filing given that they did not correspond to the time frame referenced by the 10-Q.

In accordance with Rule 12b-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), Part I, Items 1 and 2 are hereby amended and restated in their entirety. In addition, as required by Rule 12b-15 promulgated under the Exchange Act, new certifications by the Company’s principal executive officer and principal financial officer are filed herewith as exhibits to this Amendment.

Except as described above, no attempt has been made in this Amendment to modify or update the other disclosures in the Quarterly Report. Other than as specifically stated herein, this Amendment continues to speak as of the date of the Quarterly Report, and the Company has not updated the disclosures contained therein to reflect any events which occurred at a date subsequent to the filing of the Quarterly Report. Accordingly, this Amendment should be read in conjunction with the Quarterly Report.

1





Table of Contents
 
 
Page
PART I - FINANCIAL INFORMATION
 
 
 
Item 1 - Financial Statements
3
 
 
Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations
16
 
 
Item 3 – Quantitative and Qualitative disclosures about market risk
20
 
 
Item 4 – Controls and Procedures
20
 
 
PART II - OTHER INFORMATION
 
   
Item 1 – Legal Proceedings
20
 
Item 2 – Unregistered sales of equity securities and use of proceeds
 
20
 
Item 6 – Exhibits
21
 
 
SIGNATURES
22
 

2

STWC HOLDINGS, INC.


INTERIM FINANCIAL STATEMENTS

As of April 30, 2019 and 2018 and for the three-month periods ended April 30, 2019 and 2018

(UNAUDITED)
3



PART 1: FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
 
 STWC HOLDINGS, INC.
 
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 
 
 (Unaudited)
 

   
April 30, 2019
   
January 31,
2019
 
ASSETS
           
Current assets:
           
Cash
 
$
49,735
   
$
2,965
 
Accounts Receivable, net
   
56,517
     
56,459
 
Inventory
   
40,810
     
29,786
 
Prepaid expenses and other assets
   
15,470
     
19,675
 
Total current assets
   
162,532
     
108,885
 
Property and equipment, net
   
11,267
     
2,767
 
Intangible assets, net
   
9,119
     
9,452
 
Right-of-use asset
   
139,955
     
-
 
Notes receivable, related party
   
493,520
     
452,709
 
Equity method investment in unconsolidated subsidiary
   
(22,667
)
   
-
 
 Total assets
 
$
793,726
   
$
573,813
 
                 
LIABILITIES AND STOCKHOLERS’ EQUITY (DEFICIT)
               
LIABILITIES
               
Current liabilities:
               
Accounts payable
 
$
423,062
   
$
447,626
 
Accrued expenses
   
496,121
     
437,388
 
Accrued expenses, related party
   
316,747
     
218,165
 
Restricted cash held for related parties
   
91,001
     
-
 
Loan to related party
   
29,349
     
32,021
 
Deferred revenue
   
192,500
     
192,500
 
Lease liability
   
56,091
     
-
 
Notes payable, current, net of discount
   
472,951
     
274,282
 
Total current liabilities
   
2,077,822
     
1,601,982
 
Lease liability
   
84,136
     
-
 
Long-term loan from related party
   
48,240
     
48,240
 
Long-term notes payable
   
123,240
     
125,000
 
      Total liabilities
   
2,333,438
     
1,775,222
 
                 
Stockholders’ deficit
               
Common stock, no par value, 100,000,000 shares authorized, 33,872,589 and 33,792,589 issued and outstanding at April 30, 2019 and January 31, 2019, respectively.
   
     
 
Additional Paid in Capital
   
7,331,880
     
7,238,699
 
Retained deficit
   
(8,871,592
)
   
(8,440,108
)
Total stockholders’ deficit
   
(1,539,712
)
   
(1,201,409
)
Total liabilities and stockholders’ deficit
 
$
793,726
   
$
573,813
 


See accompanying notes.
4

STWC HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
   
For the Three Months Ended
April 30,
 
   
2019
   
2018
 
             
             
Consulting services
 
$
20,545
   
$
43,813
 
Product sales
   
9,822
     
-
 
Cost of consulting services
   
(11,467
)
   
(10,000
)
Gross profit
   
18,900
     
33,813

Operating costs and expenses
               
Rents and other occupancy
   
17,963
     
12,516
 
Compensation
   
162,892
     
146,204
 
Professional, legal and consulting
   
114,977
     
49,896
 
General and administrative
   
60,960
     
52,511
 
Depreciation and amortization
   
584
     
435
 
Total operating costs and expenses
   
357,376
     
261,562
 
Other income (expense)
               
Interest expense
   
(67,602
)
   
(612
)
Impairment on investment
   
(2,739
)
   
-
 
Loss on investment in affiliate
   
(22,667
)
   
-
 
Total other income (expense)
   
(93,008
)
   
(612
)
                 
Loss from operations, before provision for taxes on income
   
(431,484
)
   
(228,361
)
Provision for taxes on income
   
-
     
-
 
Net income/(loss)
 
$
(431,484
)
 
$
(228,361
)
Basic earnings and fully diluted income (loss) per common share
               
Continuing operations
 
$
(0.01
)
 
$
(0.01
)
                 
Basic and fully diluted weighted average number of shares outstanding
               
   
29,275,708
     
27,140,550
 

 See accompanying notes.
 



 
 STWC HOLDINGS, INC.
 
 
 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
 
 
 (Unaudited)
 
   
For the three months ended April 30,
 
   
2019
   
2018
 
Cash flows from operating activities:
           
Net Loss
 
$
(431,484
)
 
$
(228,361
)
Depreciation and amortization
   
584
     
435
 
Accretion of debt discount
   
40,909
     
-
 
Loss from equity investment in unconsolidated subsidiary
   
22,667
     
-
 
       Stock based compensation
   
13,181
     
-
 
Changes in assets and liabilities
               
Accounts receivable
   
(58
)
   
5,000
 
Inventory
   
(11,024
)
   
(17,377
)
Right-of-use asset
   
272
     
-
 
Notes receivable, related party
   
(128,350
)
   
(10,000
)
Prepaid expenses and other assets
   
4,205
     
(6,158
)
Accounts payable
   
66,517
     
85,440
 
Accrued expenses
   
58,733
     
81,231
 
Deferred revenue
   
-
     
53,687
 
Net cash flow used in operating activities
   
(363,848
)
   
(36,103
)
Cash flows from investing activities:
               
Purchase of fixed assets
   
(8,751
)
   
-
 
Net cash flow used in investing activities
   
(8,751
)
   
-
 
Cash flows from financing activities:
               
Proceeds from issuance of stock
   
80,000
     
-
 
Proceeds from debt
   
150,000
     
-
 
Proceeds from related party loans
   
14,369
     
8,765
 
Proceeds from related party loans, restricted cash
   
175,000
     
-
 
Net cash flows from financing activities
   
419,369
     
8,765
 
Net cash flows
   
46,770
     
(27,338
)
Cash and equivalent, beginning of period
   
2,965
     
27,925
 
Cash and equivalent, end of period
 
$
49,735
   
$
587
 
 
Supplemental cash flow disclosures:
               
Cash paid for interest
 
$
223
   
$
513
 
Cash paid for income taxes
 
$
-
   
$
-
 
                 

See accompanying notes.
5

 
 
 STWC HOLDINGS, INC.
 
 
 STATEMENT OF CHANGES IN STOCKHOLDERS’ (DEFICT)
 
 
 (Unaudited)
 
   
Three Months Ended April 30,
   
2019
 
2018
Common stock and paid-in capital
       
Balance, beginning of period
 
$  7,238,699
 
$  5,325,684
Common stock issued
 
41,353
 
-
Warrants granted
 
38,647
 
-
Stock-based compensation
 
13,181
 
-
Balance, end of period
 
$  7,331,880
 
$  5,325,684
         
Retained Earnings
       
Balance, beginning of period
 
$(8,440,108)
 
 $(6,164,832)
Net Loss
 
(431,484)
 
(228,361)
Balance, end of period
 
$(8,871,592)
 
 $(6,393,193)
         
Total stockholders’ deficit
 
 $(1,539,712)
 
$(1,067,509)

See accompanying notes.
6


STWC HOLDINGS, INC
Notes to the Unaudited Consolidated Financial Statements

Note 1 – Organization

STWC HOLDINGS, INC., through its wholly-owned subsidiary, Strainwise, Inc., (identified in these footnotes as “STWC” “we” “us” or the “Company”) provides branding marketing, administrative, accounting, financial and compliance services (“Fulfillment Services”) to entities in the cannabis retail and production industry. The Company originally incorporated in the State of Utah on April 25, 2007, and redomiciled to Colorado by merging into a Colorado corporation incorporated on June 7, 2016.  Strainwise, Inc., a wholly owned subsidiary of the Company, was originally incorporated in the state of Colorado as a limited liability company on June 8, 2012, and subsequently converted to a Colorado corporation on January 16, 2014.

On December 13, 2018, the Company invested in Meridian A, LLC which owns a CBD retail store located in Oklahoma.  The company’s Chief executive officer is the managing member of the entity and STWC Holdings, Inc. owns 75% of the legal entity.  In accordance with Accounting Standards Codification 810 Consolidation, the Company has consolidated the entity.

Note 2 – Summary of significant accounting policies

Basis of presentation - The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The Company has elected a fiscal year ending on January 31.  Certain balance sheet classifications have been made to prior period balances to reflect the current period’s presentation format.  All intercompany balances and transactions have been eliminated in the consolidated financial statements.

Unaudited Interim Financial Statements - The accompanying unaudited financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, the financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments consisting of normal recurring entries necessary for a fair statement of the periods presented for: (a) the financial position; (b) the result of operations; and (c) cash flows, have been made in order to make the financial statements presented not misleading. The results of operations for such interim periods are not necessarily indicative of operations for a full year.

Going Concern and Management’s Plan - Our Consolidated Financial Statements as of and for the period ended April 30, 2019 were prepared on the basis of a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business. Accordingly, they do not give effect to adjustments that could be necessary should we be required to liquidate assets.
 
Our ability to continue as a going concern and raise capital for specific strategic initiatives could also depend on obtaining adequate capital to fund operating losses until it becomes profitable. We can give no assurances that any additional capital that it is able to obtain, if any, will be sufficient to meet its needs, or that any such financing will be obtainable on acceptable terms.

Use of estimatesThe preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the periods presented. Actual results could differ from these estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the financial statements in the period they are deemed to be necessary. Significant estimates made in the accompanying financial statements include but are not limited to following: those related to revenue recognition, allowance for doubtful accounts and notes receivable and unbilled services, lives and recoverability of equipment and other long-lived assets, realization of deferred tax assets, valuation of equity-based transactions, contingencies and litigation. The Company is subject to uncertainties, such as the impact of future events, economic, environmental and political factors, and changes in the business climate; therefore, actual results may differ from those estimates. When no estimate in a given range is deemed to be better than any other when estimating contingent liabilities, the low end of the range is accrued. Accordingly, the accounting estimates used in the preparation of the Company's financial statements will change as new events occur, as more experience is acquired, as additional information is obtained and as the Company's operating environment changes. Changes in estimates are made when circumstances warrant. Such changes and refinements in estimation methodologies are reflected in reported results of operations; if material, the effects of changes in estimates are disclosed in the notes to the consolidated financial statements.

7

Cash and cash equivalentsthe company considers all cash in banks, money market funds, and certificates of deposit with a maturity of less than three months to be cash equivalents. Cash balances may exceed federally insured limits. Management believes the financial risk associated with these balances is minimal and has not experienced any losses to date. For the periods presented no balances exceeded the federally insured limits.

Prepaid expenses and other assetsPrepaid expenses and other current assets consist of various payments the Company has made in advance for goods or services to be received in the future. As of April 30, 2019, prepaid expenses were comprised of advance payments made to third parties for general expenses.  Prepaid general expenses are amortized over the applicable periods which approximate the life of the contract or service period.

Tenant improvements and office equipmentTenant improvements and office equipment are recorded at cost and are depreciated under straight line methods over each item's estimated useful life. Management reviews the Company’s tenant improvements and office equipment for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Maintenance and repairs of property and equipment are charged to operations. Major improvements are capitalized. Upon retirement, sale or other disposition of property and equipment, the cost and accumulated depreciation are eliminated from the accounts and any gain or loss is included in operations.

Tenant improvements and office equipment, net of accumulated amortization and depreciation are comprised of the following:
 
   
April 30, 2019
   
January 31, 2019
 
Leasehold improvements
 
$
10,951
   
$
2,200
 
Office equipment, furniture and fixtures
   
26,276
     
26,276
 
     
37,227
     
28,476
 
Accumulated amortization and depreciation
   
(25,960
)
   
(25,709
)
   
$
11,267
   
$
2,767
 
                 

Tenant improvements are amortized over the term of the lease, and office equipment is depreciated over its useful lives, which has been deemed by management to be three years. Amortization and depreciation expense related to tenant improvements and office equipment for the periods ended April 30, 2019 and 2018 was $251 and $252, respectively.

Investment in Unconsolidated EntityThe Company has a significant and non-controlling investment in several entities.  The Company accounts for its investment using the equity method based on the ownership interest and ability to exert significant influence.  Accordingly, investments are recorded at cost, and adjustments to the carrying amount of the investment are recognized in the period incurred.  The Company’s share of the earnings or losses are reported in the other income and expense section of the income statement.

Long-Lived Assets In accordance with ASC 350, the Company regularly reviews the carrying value of intangible and other long-lived assets for the existence of facts or circumstances, both internally and externally, that suggest impairment. If impairment testing indicates a lack of recoverability, an impairment loss is recognized by the Company if the carrying amount of a long-lived asset exceeds its fair value.

Trademarks – Trademarks and other intangible assets are stated at cost and are amortized using the straight-line method over fifteen years. Amortization expense for the periods ended April 30, 2019 and 2018 was $333 and $183, respectively.
Trademarks
April 30, 2019
January 31, 2019
Gross carrying amount
$             13,260
$                    13,260
Accumulated amortization
4,141
3,808
Net intangible assets
$               9,119
$        9,452



8

Comprehensive Income (Loss)Comprehensive income is defined as all changes in stockholders’ equity (deficit), exclusive of transactions with owners, such as capital investments. Comprehensive income includes net income or loss, changes in certain assets and liabilities that are reported directly in equity such as translation adjustments on investments in foreign subsidiaries and unrealized gains (losses) on available-for-sale securities. Since the Company’s inception there have been no differences between the Company’s comprehensive loss and net loss.

Net income per share of common stock - We present earnings per share (“EPS”) in accordance with ASC 260 Earnings per Share, which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. In the accompanying financial statements, basic earnings per share of common stock is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. 

Revenue Recognition
Effective February 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers using the modified retrospective method.  There was no adjustment required upon transition. Under ASC 606, the Company recognizes revenue applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied.

For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.

Consulting Services
 
We generate revenues from professional services consulting agreements. These arrangements are generally entered into: (1) on an hourly basis for an hourly fee; or, (2) on a fixed fee basis; or (3) a monthly fee basis. Generally, we require a complete or partial prepayment or retainer prior to performing services for hourly or fixed fee contracts.
 
For hourly based service contracts, we recognize revenue over time as services are performed and customers simultaneously consume such services. Any advances or retainers received from clients for hourly services are reflected in the Deferred revenue liability account until we recognize revenues as we incur and charge billable hours.
 
Our fixed fee basis engagements are recognized at a point in time. Generally, our fixed fee arrangements are for completion of a final deliverable or act which is significant to the arrangement as a whole. Although fees are typically collected in advance and the services provided have no alternative use to the Company, there is not a specific enforceable right to payment for the cost of services provided plus a reasonable profit margin.  Accordingly, advances received at contract inception are reflected in the Deferred revenue liability account until the end of the contract when revenue is recognized and the customer takes control of the deliverable.  These engagements do not generally exceed a one-year term.

Revenue recognition is affected by a number of factors that change the estimated amount of work required to complete the deliverable, such as changes in scope, timing, awaiting notification of license award from local government, and the level of client involvement. Losses, if any, on fixed-fee engagements are recognized in the period in which the loss first becomes probable and reasonably estimable. During the year ended January 31, 2019 we refunded approximately $26,251 of advances or retainers from fixed fee and hourly engagements that terminated prior to completion. We believe if an engagement terminates prior to completion, we can recover the costs incurred related to the services provided.
 
Certain of our fixed fee contracts assisting customers with license applications include a success fee which is earned if the customer is awarded a license.  We exclude such variable consideration from the transaction price and recognize the revenue.

9

When and if the license is awarded as the uncertainty of the application process creates a probability of significant revenue reversal.

Our monthly fee arrangements are billed on a monthly basis in arrears for a variety of services and are recognized over time as the customers simultaneously consume such services.

The revenue by contract type for the periods ending April 30, 2019 and 2018 are listed in the table below:

   
2019
   
2018
 
Hourly fee contracts
 
$
-
   
$
-
 
Fixed fee contracts
   
19,500
     
42,500
 
Monthly fee contracts
   
1,045
     
1,313
 
   
$
20,545
   
$
43,813
 

Deferred revenue as of April 30, 2019 and January 31, 2019 was $192,500.  The Company is unable to determine timing for revenue recognition at this time for its deferred revenue due to state regulation changes.

Product Sales
 
Revenue from product sales, including delivery fees, is recognized when an order has been obtained from the customer, the price is fixed and determinable when the order is placed, the product is shipped, title has transferred and collectability is reasonably assured. Given the facts that (1) our customers exercise discretion in determining the timing of when they place their product order; and, (2) the price negotiated in our product sales contracts is fixed and determinable at the time the customer places the order, we are not of the opinion that our product sales indicate or involve any significant financing that would materially change the amount of revenue recognized under the contract, or would otherwise contain a significant financing component for us or the customer under FASB ASC Topic 606.

Reclassifications - Certain account reclassifications have been made to prior period balances to reflect the current period’s presentation format; such reclassifications had no impact on the Company’s consolidated statements of operations or consolidated statements of cash flows and had no material impact on the Company’s consolidated balance sheets.

Stock-Based Compensation – The Company records equity instruments at their fair value on the measurement date by utilizing the Black-Scholes option-pricing model.  Stock Compensation for all share-based payments, is recognized as an expense over the requisite service period.

Significant assumptions utilized in determining the fair value of our stock options included the volatility rate, estimated term of the options, risk-free interest rate and forfeiture rate.  The term of the options was assumed to be five years.  The risk-free interest rate was determined utilizing the treasury rate with a maturity equal to the estimated term of the option grant.  Finally, management assumed a 0% forfeiture rate in fiscal year 2018.

Non-employee share-based compensation charges generally are immediately vested and have no future performance requirements by the non-employee and the total share-based compensation charge is recorded in the period of the measurement date.

Recently Issued Accounting Pronouncements
 
The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and ensure that there are proper controls in place to ascertain that the Company’s financial statements properly reflect the change. New pronouncements assessed by the Company recently are discussed below:
 
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which supersedes Topic 840, Leases (“ASU 2016-02”). The guidance in this new standard requires lessees to put most leases on their balance sheets but recognize expenses on their income statements in a manner similar to the current accounting and eliminates the current real estate-specific provisions for all entities. The guidance also modifies the classification criteria and the accounting for sales-type and direct financing leases for lessors. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with early adoption permitted. The Company adopted the standard effective February 1, 2019 by recording an immaterial transition adjustment and right of use assets and lease liabilities of approximately $150,000.
10


In July 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which among other things, these amendments require the measurement of all expected credit losses of financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 is effective for periods beginning after December 15, 2019, and interim periods within those fiscal years. The Company is in the process of evaluating the impact of the pronouncement.

In August 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-13, Fair Value Measurement (Topic 820), “Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement”. The amendments in this Update modify certain disclosure requirements of fair value measurements and are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is in the process of evaluation the impact of the pronouncement.

Note 3 – Going concern:
 
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Since inception, we have not achieved profitable operations, and have cumulative losses through April 30, 2019 of $8.9 million. The Company’s losses to date raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon the Company’s achieving a sustainable level of profitability. The Company intends to continue financing its future development activities and its working capital needs largely from the private sale of the Company’s securities, with additional funding from other traditional financing sources, including convertible term notes, until such time that funds provided by operations are sufficient to fund working capital requirements. However, the financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.

Note 4 – Fair value of financial instruments

The carrying amounts of cash and current liabilities approximate fair value because of the short maturity of these items. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment, and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. We do not hold or issue financial instruments for trading purposes, nor do we utilize derivative instruments in the management of our foreign exchange, commodity price or interest rate market risks.
 
The FASB Codification clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. It also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows:
 
Level 1:
Quoted prices in active markets for identical assets or liabilities.
 
Level 2:
Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability.
 
Level 3:
Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
 
The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
11


Note 5 – Commitments and contingencies

The Company entered into a right-of-use operating lease agreement with an affiliate for the Company’s corporate office needs, consisting of 4,000 square feet of office space. The lease is for a 4-year period ending October 31, 2021. This lease to the Company is on the same terms and conditions as is the direct lease between the affiliate and the independent lessor.  The office space lease includes in-substance fixed lease payments, and does not provide an implicit rate, the remaining lease term for the office space is 30 months.

As of April 30, 2019, maturities of the lease liability are as follows:

For the Fiscal Year Ending
 January 31,
     
2020
   
41,227
 
2021
   
56,250
 
2022
   
42,750
 
Thereafter
   
 
Total minimum lease payments
 
$
140,227
 

During the periods ended April 30, 2019 and 2018, rent expense was $17,963 and $12,516, respectively.

Note 6 – Notes Receivable

The Company has management and licensing agreements with a private entity in Puerto Rico 39% owned by the Company’s CEO, Erin Phillips, to operate four dispensaries and one cultivation operation in Puerto Rico. In conjunction with these agreements, the Company as begun providing funds to operate the Puerto Rico operations, which will be evidenced by a promissory note. The terms have not been finalized on this note and currently there is no specified terms to the agreement. Through April 30, 2019 the Company has advanced $280,607 related to the note.

The Company has management and licensing agreements with two private entities in Oklahoma.  STWC has a 25% ownership in 2600 Meridian LLC, and an option to acquire 25% interest in HWH Farms, LLC.  In conjunction with these agreements, the Company has begun providing funds for start-up and development costs, which will be evidenced by a promissory note. The terms have not been finalized on these notes and currently there is no specified terms to the agreement. Through April 30, 2019 the Company has advanced $55,110 to 2600 Meridian, LLC and $157,802 to HWH Farms, LLC related to the notes.

Note 7 – Related Party

The Company has entered into separate management and licensing contracts with STWC Sorrento Valley, LLC which is partially owned by the Company's CEO, Erin Phillips. Ms. Phillips owns 27.5% of the STWC Sorrento Valley, LLC.  Ms. Phillips allocated $200,000 of the Green Acres note to fund the related project in California as directed by the note agreement which reduced the liability to Ms. Phillips for loan advances received as of April 30, 2019.

The Company manages its cash flow by utilizing related party loans.  During the period ended April 30, 2019 and 2018 the company borrowed $14,369 and $8,765, respectively, from related parties to fund operations. The loans do not carry any interest. The Company converted an accrued expense with a related party to a note payable in the amount of $60,300.  The note has a maturity of May 2020, $48,240 is reflected in Long-term loan to related party on the balance sheet.  As of April 30, 2019, and 2018, the Company reflected current loans payable to related parties of $29,349 and $32,021, respectively.

The Company received $125,000 for the benefit of the Puerto Rico entities and is disbursing these funds to operate the Puerto Rico operations, the balance as of April 30, 2019 was $65,499.  In addition, the Company received $50,000 for the benefit of 2600 Meridian LLC, the funds have been used to cover start-up and development costs, the balance as of April 30, 2019 was $25,502.  The funds held for related party entities is held in restricted cash liabilities on the balance sheet.
12

Note 8 – Notes Payable

Note purchase and security agreementOn August 29, 2018, the Company entered into a Note Purchase and Security Agreement with Richland Fund, LLC., a Delaware limited liability company. Pursuant to the Agreement, Richland agreed

to purchase Convertible Promissory Notes of the Company in the aggregate principal amount of $225,000, funded in three tranches, (i) $100,000.00 (the "First Note"), (ii) $67,000.00 (the "Second Note"), and (iii) the balance of $58,000.00 (the "Third Note"). The Notes bear 12% interest per annum, with the last payment under the Notes due December 15, 2020. The Notes are secured by all assets of the Company and guarantees from Shawn and Erin Phillips.

The Notes are convertible into common stock of the Company. The conversion price will be equal to the lower of (i) $0.15 cents per share (ii) or the average of the closing bid price of the Company's common stock taken over the three trading days
prior to conversion or (iii) upon any issuance by the Company of common stock, or a security that is convertible into common stock, at a price lower than a net receipt to the Company of $0.15 per share, at such price that shall be at the same discount ratio as on the Funding Date. The conversion price of the Notes will be further subject to proportional adjustment for stock splits, reverse stock splits or combinations of shares, stock dividends, and the like. There are penalties for failure to timely deliver conversion shares.  The company recognized a beneficial conversion feature on the notes as a discount and additional paid in capital of $225,000.  The company has recognized $40,909 in interest expense for the amortization of the debt discount for the period ending April 30, 2019.

In connection with the funding agreement, the Company agreed to form and organize a subsidiary.  The Company and lender are in discussions regarding the assets to be held in the subsidiary, nothing has been finalized as of the issuance date.

Loan Agreement – On April 6, 2018, the Company entered into a loan agreement with Green Acres Partners A, LLC, (the “lender”) whereby the lender agreed to loan to the Company $205,000.  The loan proceeds are to be used specifically for the capital needs of two related party projects in San Diego, California.  The interest rate on the notes is 12% per annum and monthly interest payments are due the first day beginning no later than August 1, 2019; thereafter the Company shall pay interest and principal on 60% of the Company’s ownership percentage of the available profits from the San Diego projects.   The loan is personally guaranteed by Shawn Phillips, the husband of Erin Phillips, our CEO.

Secured Promissory Note – On December 7, 2018, the Company entered into a 15% Secured Promissory Note with Richland Fund, LLC, (the “lender”) whereby the lender agreed to loan to the Company $126,100.  The interest rate on the notes is 15% per annum and monthly interest payments are due the first day each month beginning January 1, 2019.  If any interest payment remains unpaid and the lender has not declared the entire principal and unpaid accrued interest due and payable, the interest rate on that amount only will be increased to 20% per annum, until the past due interest amount is paid in full.  The note originally matured on March 7, 2019 but was extended to a maturity date of August 1, 2019.

Securities Purchase Agreement On February 13, 2019, the Company entered into a Securities Purchase Agreement with Power Up Lending Group Ltd. pursuant to which Power Up agreed to purchase a convertible promissory note in the face amount of $103,000. On February 15, 2019, the Company issued the Note. The Note matures on February 13, 2020, and bears interest at 12% per annum, increasing to 22% after maturity.

On March 18, 2019, the Company entered into the second tranche of the potential $1,000,000 funding with Power Up.  The Company entered into a second Securities Purchase Agreement pursuant to which Power Up agreed to purchase a convertible promissory note in the face amount of $53,000. On March 18, 2019, the Company issued the Note. The Note matures on March 18, 2020, and bears interest at 12% per annum, increasing to 22% after maturity.

Under the Note, Power Up may convert all or a portion of the outstanding principal of the Note into shares of common stock of the Company beginning on the date which is 180 days from the date of the Note, at a price equal to 61% of the lowest trading price during the 20 trading day period ending on the last complete trading date prior to the date of conversion; provided, however, that Power Up may not convert the Note to the extent that such conversion would result in beneficial ownership by Power Up and its affiliates of more than 4.99% of the Company’s issued and outstanding Common Stock.

If the Company prepays the Note within 30 days of the date of the Note, the Company must pay all of the principal at a cash redemption premium of 110%; if the prepayment is made between the 31st day and the 60th day after the date of the Note, then the redemption premium is 115%; if the prepayment is made from the 61st to the 90th day after date of the Note, then the redemption premium is 120%; if the prepayment is made from the 91st to the 120th day after the date of the Note, then the redemption premium is 125%; if the prepayment is made from the 121st to the 150th day after the date of the Note, then the redemption premium is 130%; and if the prepayment is made from the 151st to the 180th day after the date of the Note, then the redemption premium is 135%. The Note cannot be prepaid after the 180th day following the date of the Note.
13

The Company is required to reserve for issuance upon conversion of the Note, six times the number of shares that would be issuable upon full conversion of the Note, assuming the 4.99% limitation were not in effect.  In connection with the Note, the Company has caused its transfer agent to reserve initially 1,494,276 shares of Common Stock. The Company received a net amount of $150,000, with $6,000 paid for Power Up’s legal and due diligence expenses.

Note 9 – Stockholders Equity

Common Stock

On February 4, 2019, the Company initiated a private equity offering to accredited investors (the "Offering") in accordance with Regulation D under the Securities Act of 1933 ("Securities Act"). The Offering consisted of 2,000,000 units with each unit consisting of one share of the Company's Common Stock and a warrant to purchase an additional share of common for $2.00 at any time prior to January 31, 2022.  During the three months ended April 30, 2019, 80,000 units were sold at a price per unit of $1.00, for offering proceeds of $80,000. The company allocated proceeds at the estimated fair value of the common shares and warrants for value of $41,353 and $38,647, respectively.

Warrants


 
 
Number of Warrants
 
Exercise Price
 
Wtgd Avg Calculation
 
Wtgd Avg Remining Life
Balance at 1/31/2018
 
      2,224,700
 
 $      5.00
 
 $   11,123,500
 
           1.00
 
 
 
 
 
 
 
 
 
Granted
 
         2,000,000
 
  0.16
 
 $          322,000
 
 
Exercised
 
         (311,000)
 
 0.16
 
 $         (49,650)
 
 
Cancelled
 
(2,013,700)
 
           5.00
 
 $  (11,091,850)
 
 
 
 
 
 
 
 
 
 
 
Balance at 1/31/2019
 
      1,900,000
 
 $      0.16
 
 $          304,000
 
            1.71
 
 
 
 
 
 
 
 
 
Granted
 
      80,000
 
          2.00
 
 $        160,000
 
 
Exercised
 
-
 
          -
 
-
 
 
Cancelled
 
-
 
-
 
-
 
 
 
 
 
 
 
 
 
 
 
Balance at 4/30/19
 
      1,980,000
 
 $      0.23
 
 $      464,000
 
            1.52


Stock Options
The Company has 250,000 stock options outstanding at April 30, 2019 and recognized $13,180 in stock compensation expense for the period ended April 30, 2019.  The Company has $184,538 in unrecognized stock compensation expense.

The Company accounts for unit-based compensation using the Black-Scholes model to estimate the fair value of unit-based awards at the date of grant. The Black-Scholes model requires the use of highly subjective assumptions, including value of the enterprise, expected life, expected volatility, and expected risk-free rate of return.  Other reasonable assumptions could provide differing results.
14

The Company amortizes the fair value of stock options on a ratable basis over the requisite service periods, which are generally the vesting periods.  The expected life of awards granted represents the period of time that they are expected to be outstanding.  The Company determines the expected life based on historical experience with similar awards, giving consideration to the contractual terms, expected time to a liquidity event, exercise patterns, and post-vesting forfeitures.  The Company estimates volatility based on the historical volatility of comparable company’s common stock over the most recent period corresponding with the estimated expected life of the award.  The Company bases the risk-free interest rate used in the Black-Scholes model on the implied yield currently available on U.S. Treasury zero-coupon issues with an equivalent term equal to the expected life of the award. The Company uses historical data to estimate pre-vesting option forfeitures and record unit-based compensation for those awards that are expected to vest. The Company adjusts unit-based compensation for changes to the estimate of expected equity award forfeitures based on actual forfeiture experience.  The effect of adjusting the forfeiture rate is recognized in the period the forfeiture estimate is changed.

The assumptions used in the fair value calculations are as follows for the period ended April 30, 2019:

Expected term (years)
5
Risk-free interest rate
2.73%
Volatility
218%
Expected dividend yield
0.00%


Note 10 – Subsequent Events

GAAP requires an entity to disclose events that occur after the balance sheet date but before financial statements are issued or are available to be issued (“subsequent events”) as well as the date through which an entity has evaluated subsequent events. There are two types of subsequent events. The first type consists of events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements, (“recognized subsequent events”). The second type consists of events that provide evidence about conditions that did not exist at the date of the balance sheet but arose subsequent to that date (“non-recognized subsequent events”).

On May 1, 2019 we received funds from Crown Bridge Partners, LLC ("Crown Bridge") under a Securities Purchase Agreement dated April 18, 2019 (the “SPA”).  Under the terms of the SPA, we received a total of $95,000, after an original issue discount of $5,000, and issued a convertible promissory note dated April 18, 2019, in the principal amount of $100,000 (the " Note").  In addition, we reimbursed Crown Bridge $2,000 for its legal fees.  We also issued warrants to purchase 60,606 shares of our common stock (the “Warrant”) associated with this transaction.
 
The maturity date of the Note is 12 months from April 18, 2019. The Note bears interest at 12% per annum at its face amount, with a default rate of 15% per annum (or the maximum amount permitted by law). If we prepay the Note through the 180th day following the date thereof, we must pay all of the principal and interest with a prepayment penalty ranging from 135% to 150%. After the 180th day we have no further right of prepayment.
 
Crown Bridge may, at any time, convert all or any part of the outstanding principal of the Note into shares of our common stock at a price per share equal to 60% (representing a 40% discount rate) of the lowest trading price of the common stock during the 20 trading day period ending on the last complete trading day prior to the date of conversion. If the conversion price is equal to or lower than $0.35 per share, an additional 15% discount will be applied (resulting in a 55% discount rate, assuming no other adjustments); if we are unable to deliver converted shares via DWAC, an additional 10% discount will be applied (resulting in a discount rate of 50%, assuming no other adjustments); if we fail to comply with our reporting requirements under the Exchange Act, an additional 15% discount will be applied (resulting in a discount rate of 55%, assuming no other adjustments); and if we fail to maintain our status as "DTC Eligible" or if at any time the conversion price is lower than $0.10, an additional 10% discount will be applied (resulting in a discount of 65%, assuming no other adjustments except for the 15% discount due to the conversion price below $0.35).  Crown Bridge may not convert the Note to the extent that such conversion would result in beneficial ownership by Crown Bridge and its affiliates of more than 4.99% of our issued and outstanding common stock.  We have also granted piggy-back registration rights for the shares issuable upon conversion of the Note.
 
The Note contains certain representations, warranties, covenants (both affirmative and negative), and events of default, including if our common stock is suspended or delisted for trading, or if we are delinquent in our periodic report filings with the SEC. In the event of a default, at the option of Crown Bridge, it may consider the Note immediately due and payable and the amount of repayment increases to 150% of the outstanding balance of the Note.  The Note also grants Crown Bridge a right of first refusal for any future capital raises or financings by us.  It also contains a most favored nations provision for any more favorable terms in future financing transactions by us.
 
The Warrant may be exercised at any time through the second anniversary date of the Note. The exercise price per share of common stock under the Warrant is $1.65 per share, subject to adjustment, including cashless exercise.  The Warrant also contains a most favored nations provision.
15


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

Overview

We were established to provide sophisticated fulfillment services to medical and retail stores, and cultivation facilities in the regulated cannabis industry throughout the United States. Such fulfillment services would only be provided to stores and facilities located in geographical areas where the governing state and local ordinances allow for the unfettered provisions of such services.

The fulfillment services that we currently are able to provide are summarized, as follows:

·
Opportunity Assessment: For a standard fee, we will complete an Opportunity Assessment for a client, which would include financial modeling, completed with our proprietary assessment software.

·
Application Filing Assistance: Based upon our knowledge of the various rules and regulations of respective state and local jurisdictions, we will provide turn-key application preparation and submission services for a client, and/or provide consulting assistance to a client who is self-preparing their application.

·
Branding, Marketing and Administrative Consulting Services: Customers may contract with us to use the Strainwise name, logo and affinity images in their retail store locations. A monthly fee will permit a branding customer to use the Strainwise brand at a specific location. In addition, we will assist operators in marketing and managing their businesses, setting up new retail locations and general business planning and execution at an hourly rate. This includes services to establish an efficient, predictable production process, as well as, nutrient recipes for consistent and appealing marijuana strains.

·
Accounting and Financial Services: For a monthly fee, we will provide customers with a fully implemented general ledger system, with an industry centric chart of accounts, which enables management to readily monitor and manage all facets of a marijuana medical dispensary and cultivation facility. We will provide bookkeeping, accounts payable processing, cash management, general ledger processing, financial statement preparation, state and municipal sales tax filings, and state and federal income tax compilation and filings.

·
Compliance Services: The rules, regulations and state laws governing the production, distribution and retail sale of marijuana can be complex, and compliance may prove cumbersome. Thus, customers may contract with us to implement a compliance process, based upon the number and type of licenses and permits for their specific business. We will provide this service on both an hourly rate and stipulated monthly fee.

·
Lending: We will provide loans to individuals and businesses in the cannabis industry.

We do NOT grow marijuana plants, produce marijuana infused products, sell marijuana plants and/or sell marijuana infused products of any nature in any jurisdiction were such activity has not been legalized.

16

Historical Overview

Since the change in our business operations in 2017, we have secured debt and equity funding for operations from various sources, including the following:

Equity Funding

On February 4, 2019, the Company initiated a private equity offering to accredited investors (the "Offering") in accordance with Regulation D under the Securities Act of 1933 ("Securities Act"). The Offering consisted of 2,000,000 units with each unit consisting of one share of the Company's Common Stock and a warrant to purchase an additional share of common for $2.00 at any time prior to January 31, 2022.  During the three months ended April 30, 2019 80,000 units were sold at a price per unit of $1.00, for offering proceeds of $80,000.  The company allocated proceeds at the estimated fair value of the common shares and warrants for value of $41,353 and $38,647, respectively.

Power Up Convertible Debt Funding

In February 2019 we secured funding through a Securities Purchase Agreement with Power Up Lending Group Ltd. (“Power Up”) pursuant to which Power Up purchased a convertible promissory note (the “First Tranche Note”) in the face amount of $103,000. The First Tranche Note matures on February 13, 2020, and bears interest at 12% per annum, increasing to 22% after maturity.  Power Up may convert all or a portion of the outstanding principal of the First Tranche Note into shares of our common stock beginning on the date which is 180 days from the date of the First Tranche Note, at a price equal to 61% of the lowest trading price during the 20 trading day period ending on the last complete trading date prior to the date of conversion; provided, however, that Power Up may not convert the Note to the extent that such conversion would result in beneficial ownership by Power Up and its affiliates of more than 4.99% of our outstanding common stock.  During the first six months of the First Tranche Note we can prepay the note at premiums ranging from 110% to 135%. The First Tranche Note cannot be prepaid after the 180th day following the date thereof.  We are required to reserve for issuance upon conversion of the First Tranche Note, six times the number of shares that would be issuable upon full conversion thereof, assuming the 4.99% limitation were not in effect.  In connection with the First Tranche Note, we have caused our transfer agent to reserve initially 880,969 shares of Common Stock. We received a net amount of $100,000, with $2,500 paid for Power Up’s legal counsel and $500 for Power Up’s due diligence fee.

On March 18, 2019, we entered into a second funding arrangement with Power Up under terms identical to the first transaction.  The second note (the “Second Tranche Note”) is in the face amount of $53,000 and matures on March 18, 2020.  In connection with the Second Tranche Note, we caused our transfer agent to reserve initially 613,307 shares of Common Stock. We received a net amount of $50,000, with $3,000 paid for Power Up’s legal and due diligence expenses.

Crown Bridge Partners Convertible Debt Funding
On May 1, 2019 we received funding from Crown Bridge Partners, LLC ("Crown Bridge") under a Securities Purchase Agreement dated April 18, 2019 (the “SPA”).  Under the terms of the SPA, we received a total of $95,000, after an original issue discount of $5,000, and issued a convertible promissory note dated April 18, 2019, in the principal amount of $100,000 (the "Note").  In addition, we reimbursed Crown Bridge $2,000 for its legal fees.  We also issued warrants to purchase 60,606 shares of our common stock (the “Warrant”) associated with this transaction. The Warrant may be exercised at any time through the second anniversary date of the Note. The exercise price per share of common stock under the Warrant is $1.65 per share, subject to adjustment, including cashless exercise.  The Warrant also contains a most favored nations provision.
 
The maturity date of the Note is 12 months from April 18, 2019. The Note bears interest at 12% per annum at its face amount, with a default rate of 15% per annum (or the maximum amount permitted by law). If we prepay the Note through the 180th day following the date thereof, we must pay all of the principal and interest with a prepayment penalty ranging from 135% to 150%. After the 180th day we have no further right of prepayment.
 
Crown Bridge may, at any time, convert all or any part of the outstanding principal of the Note into shares of our common stock at a price per share equal to 60% (representing a 40% discount rate) of the lowest trading price of the common stock during the 20 trading day period ending on the last complete trading day prior to the date of conversion. If the conversion price is equal to or lower than $0.35 per share, an additional 15% discount will be applied (resulting in a 55% discount rate, assuming no other adjustments); if we are unable to deliver converted shares via DWAC, an additional 10% discount will be applied (resulting in a discount rate of 50%, assuming no other adjustments); if we fail to comply with our reporting requirements under the Exchange Act, an additional 15% discount will be applied (resulting in a discount rate of 55%, assuming no other adjustments); and if we fail to maintain our status as "DTC Eligible" or if at any time the conversion price is lower than $0.10, an additional 10% discount will be applied (resulting in a discount of 65%, assuming no other adjustments except for the 15% discount due to the conversion price below $0.35).  Crown Bridge may not convert the Note to the extent that such conversion would result in beneficial ownership by Crown Bridge and its affiliates of more than 4.99% of our issued and outstanding common stock.  We have also granted piggy-back registration rights for the shares issuable upon conversion of the Note. 
17


Results of Operations

Comparison of the periods ended April 30, 2019 and 2018
 
 
For the three months ended
             
 
 
April 30,
             
 
 
2019
   
2018
   
Change
 
Consulting services
 
$
20,545
   
$
43,813
   
$
(23,268
)
   
-53
%
Product sales
   
9,822
     
-
     
9,822
     
100
%
Cost of consulting services
   
(11,467
)
   
(10,000
)
   
(1,467
)
   
-15
%
Gross profit
   
18,900
     
33,813
     
(14,913
)
   
-44
%
Operating costs and expenses
                               
Rents and other occupancy
   
17,963
     
12,516
     
5,447
     
44
%
Compensation
   
162,892
     
146,204
     
16,688
     
11
%
Professional, legal and consulting
   
114,977
     
49,896
     
65,081
     
130
%
General and administrative
   
60,960
     
52,511
     
8,449
     
16
%
Depreciation and amortization
   
584
     
435
     
149
     
34
%
Total operating costs and expenses
   
357,376
     
261,562
     
95,814
     
37
%
Other income (expense)
                               
Interest expense
   
(67,602
)
   
(612
)
   
(66,990
)
   
10946
%
Impairment on investment
   
(2,739
)
   
-
     
(2,739
)
   
100
%
Loss on investment in affiliate
   
(22,667
)
   
-
     
(22,667
)
   
-100
%
Total other income (expense)
   
(93,008
)
   
(612
)
   
(92,396
)
   
15097
%
Loss from continuing operations, before provision for taxes on income
   
(431,484
)
   
(228,361
)
   
(203,123
)
   
89
%
Provision for taxes on income
   
-
     
-
     
-
     
0
%
Net income (loss)
 
$
(431,484
)
 
$
(228,361
)
 
$
(203,123
)
   
89
%

Material changes in line items in our Statement of Operations for the periods ended April 30, 2019 as compared to the same period last year, are discussed below:

·
Professional, legal, and consulting – Professional legal and accounting/consulting services increased during the year due to additional resources used for compliance.
·
Interest expense – Interest increased as a result of new debt arrangements during the periods, in addition to the amortization of the debt discount in the amount of $40,909.

Liquidity and Capital Resources

Overview

We have incurred operating losses, accumulated deficit and negative cash flows from operations since inception.  As of April 30, 2019, we had an accumulated deficit of $8,871,592 from operating activities.  The Company had total cash on hand of approximately $50,000, and approximately $91,000 in restricted cash for the benefit of related parties as of April 30, 2019. The Company utilizes credit from vendors, borrowings from related parties, and secured third party financing to manage its cash flow.  Management believes the change in focus along with our substantial industry knowledge, defined growth strategy, and minimal expense structure will allow us to ultimately achieve profitability. We have restructured our operating expenses sufficiently and believe that our planned sources of revenue will be sufficient to cover these expenses for the foreseeable future.
18

Our Consolidated Financial Statements as of and for the three months ended April 30, 2019 were prepared on the basis of a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business. Accordingly, they do not give effect to adjustments that could be necessary should we be required to liquidate assets.
 
Our ability to continue as a going concern and raise capital for specific strategic initiatives could also depend on obtaining adequate capital to fund operating losses until it becomes profitable. We can give no assurances that any additional capital that it is able to obtain, if any, will be sufficient to meet its needs, or that any such financing will be obtainable on acceptable terms.

Our net cash flows are as follows:

   
For the three months
ended April 30,
 
   
2019
   
2018
 
Consolidated Statements of Cash Flows Data:
               
Net cash used in operating activities
 
$
(363,848)
   
$
(36,103
)
Net cash used in investing activities
   
(8,751)
     
-
 
Net cash provided by financing activities
   
419,369
     
8,765
 
Net change in cash
 
$
46,770
   
$
(27,338
)

Operating Activities

During the three months ended April 30, 2019, the Company used $369,848 in cash for continuing operations compared to cash used of $36,103 for continuing during the three months ended April 30, 2018.  This increase in cash used for operating activities was due to the significant investment in affiliates and loans to affiliates.

Investing Activities

During the three months ended April 30, 2019, the Company invested $8,751 in fixed assets, compared to no investment during the same period of 2018.

Financing Activities

Our cash provided by financing for the three months ended April 30, 2019 was $425,369 compared to cash provided of $8,765 from continuing operations.

During the year ended January 31, 2019 the company entered into convertible debt funding from tranche one in the amount of $100,000 and $50,000 received in tranche two.  The debt becomes convertible into the Company’s common shares on the 180th day from the receipt of the tranche.

The Company received $14,369 and $8,765 during the three months ended April 30, 2019 and 2018, respectively, from related party loans.

In February 2019 the Company launched a non-public equity offering at $1.00 per unit.  We raised cash proceeds of $80,000 and issued 80,000 shares of common stock and 80,000 warrants to purchase common stock at an exercise price of $2.00 per share.

The Company received $125,000 for the benefit of the Puerto Rico entities and is disbursing these funds to operate the Puerto Rico operations, the balance as of April 30, 2019 was $65,499.  In addition, the Company received $50,000 for the benefit of 2600 Meridian LLC, the funds have been used to cover start-up and development costs, the balance as of April 30, 2019 was $25,502.  The funds held for related party entities is held in restricted cash liabilities on the balance sheet.
19

Off Balance Sheet Arrangements

As of April 30, 2019, and April 30, 2018, we did not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Critical Accounting Policies and New Accounting Pronouncements

See Note 2 to the financial statements included as part of this report for a description of the Company’s significant accounting policies.

 
ITEM 3.
QUANTITATIVE & QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
We are a smaller reporting Company and are not required to provide the information required under this item.

 
ITEM 4.
CONTROLS AND PROCEDURES
 

Disclosure Controls and Procedures

Under the direction and with the participation of our management, we carried out an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures as of April 30, 2019. We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in its periodic reports with the Securities and Exchange Commission is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and regulations, and that such information is accumulated and communicated to our management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. our disclosure controls and procedures are designed to provide a reasonable level of assurance of reaching its desired disclosure control objectives. Based upon this evaluation, management concluded that our disclosure controls and procedures were not effective as of April 30, 2019 primarily based on these criteria, due to material weaknesses resulting from our failure to 1) provide correct responsibilities to adequately segregate activity in the area of cash receipts and cash disbursements, 2) effectively implement comprehensive entity level internal controls, and 3) adequately segregate duties within the accounting department due to an insufficient number of staff.

Changes in Internal Controls

There were no changes in the Company’s internal control over financial reporting during the quarter ended April 30, 2019, that materially affected, or are reasonably likely to materially affect, its internal control over financial reporting.

PART II. OTHER INFORMATION
 
Item 1. Legal Proceedings
 
In connection with the Settlement Agreement with Headgate II, LLC, William A. Shopneck, and Christopher Shopneck (collectively, the "Plaintiffs") disclosed under Item 3 of our annual report on Form 10-K for the year ended January 31, 2019, we are current in our settlement payments to the Plaintiffs.

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

In February 2019 we commended an offering of up to 2,000,000 units at a price per unit of $1.00.  Each unit is comprised of one share of common stock and one three-year warrant to purchase an additional share of common stock at $2.00 per share.  During the quarter ended April 30, 2019, we sold 80,000 units to two investors for gross proceeds of $80,000.  We issued 80,000 common shares and issued warrants to purchase an additional 80,000 shares to these investors.  The securities were sold without registration under the Securities Act by reason of the exemption from registration afforded by the provisions of Section 4(a)(5) and Section 4(a)(2) thereof, and Rule 506(b) promulgated thereunder, as a transaction by an issuer not involving any public offering. At the time of the sale of the shares, we reasonably believed that each purchaser was an accredited investor as defined in Regulation D. No underwriting discounts or commissions were paid in connection with the transactions. 
20


Item 6. Exhibits
31.1 Rule 13a-14(d) Certification by Principal Executive Officer
31.2 Rule 13a-14(d) Certification by Principal Financial Officer
32.1 Section 1350 Certification of Principal Executive and Financial Officer

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SIGNATURE PAGE FOLLOWS
21



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.

STWC HOLDINGS, INC.

June 19, 2019                                                                                    By: /s/ Erin Phillips  
      Erin Phillips, CEO
(Principal Executive, Financial and Accounting Officer)


22
EX-31.1 2 stwc10qacert31_1043019.htm STWC HOLDINGS, INC. CERTIFICATION 31.1 APRIL 30, 2019
Certification

I, Erin Phillips, certify that:

1. I have reviewed this amendment to the Form 10-Q quarterly report of STWC Holdings, Inc. for the quarter ended April 30, 2019;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  June 19, 2019


                                                                                               /s/ Erin Phillips 
Erin Phillips, CEO
                (Principal Executive Officer)
EX-31.2 3 stwc10qacert31_2043019.htm STWC HOLDINGS, INC. 10-Q/A CERTIFICATION 31.2 APRIL 30, 2019
Certification

I, Erin Phillips, certify that:

1. I have reviewed this amendment to the Form 10-Q quarterly report of STWC Holdings, Inc. for the quarter ended April 30, 2019;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  June 19, 2019


                                                                                        /s/ Erin Phillips 
Erin Phillips, Treasurer
        (Principal Financial Officer)
EX-32 4 stwc10qacert32_04302019.htm STWC HOLDINGS, INC. 10-Q/A CERTIFICATION 32 APRIL 30, 2019

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In connection with the amendment to the quarterly report of STWC Holdings, Inc. (the “Company”) on Form 10‑Q for the quarter ended April 30, 2019, as filed with the Securities and Exchange Commission (the “Report”), the undersigned principal executive and financial officer of the Company, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:


(1)
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and


(2)
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



Date:  June 19, 2019


                                                             /s/Erin Phillips 
                                                                                                                     Erin Phillips, 
    (Principal Executive Officer and Principal Financial Officer)
EX-101.INS 5 stwc-20190430.xml XBRL INSTANCE DOCUMENT STWC. Holdings, Inc. 0001400683 --01-31 Non-accelerated Filer Yes Yes false true true false false 2020 Q1 true false 10-Q 2019-04-30 000-52825 20-8980078 1350 Independence St., Suite 300 Lakewood CO 80215 Address of principal executive offices 34220089 56517 56459 40810 29786 15470 19675 162532 108885 9119 9452 139955 0 493520 452709 -22667 0 793726 573813 423062 447626 496121 437388 -316747 -218165 -91001 0 -29349 -32021 192500 192500 56091 0 472951 274282 2077822 1601982 84136 0 48240 48240 -123240 -125000 2333438 1775222 0 0 100000000 100000000 33872589 33872589 33792589 33792589 0 0 7331880 7238699 -1539712 -1201409 793726 573813 20545 43813 -9822 0 11467 10000 18900 33813 162892 146204 114977 49896 60960 52511 584 435 357376 261562 67602 612 -2739 0 -22667 0 -93008 -612 -431484 -228361 0 0 -0.01 -0.01 29275708 27140550 -431484 -228361 584 435 40909 0 -22667 0 13181 0 58 -5000 11024 17377 272 0 128350 10000 -4205 6158 66517 85440 58733 81231 0 53687 -363848 -36103 8751 0 -8751 0 80000 0 150000 0 14369 8765 175000 0 419369 8765 46770 -27338 2965 27925 49735 587 223 513 0 0 7238699 5325684 41353 0 38647 0 13181 0 7331880 5325684 -8440108 -6164832 -431484 -228361 -8871592 -6393193 -1539712 -1067509 <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>Note 1 &#150; Organization</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>STWC HOLDINGS, INC., through its wholly-owned subsidiary, Strainwise, Inc., (identified in these footnotes as &#147;STWC&#148; &#147;we&#148; &#147;us&#148; or the &#147;Company&#148;) provides branding marketing, administrative, accounting, financial and compliance services (&#147;Fulfillment Services&#148;) to entities in the cannabis retail and production industry. The Company originally incorporated in the State of Utah on April 25, 2007, and redomiciled to Colorado by merging into a Colorado corporation incorporated on June 7, 2016.&#160; Strainwise, Inc., a wholly owned subsidiary of the Company, was originally incorporated in the state of Colorado as a limited liability company on June 8, 2012, and subsequently converted to a Colorado corporation on January 16, 2014. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>On December 13, 2018, the Company invested in Meridian A, LLC which owns a CBD retail store located in Oklahoma.&#160; The company&#146;s Chief executive officer is the managing member of the entity and STWC Holdings, Inc. owns 75% of the legal entity.&#160; In accordance with Accounting Standards Codification 810 <i>Consolidation</i>, the Company has consolidated the entity. </p> CO 2014-01-16 <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>Note 2 &#150; Summary of significant accounting policies</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Basis of presentation</i></b> - The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (&quot;U.S. GAAP&quot;). The Company has elected a fiscal year ending on January 31.&#160; Certain balance sheet classifications have been made to prior period balances to reflect the current period&#146;s presentation format.&#160; All intercompany balances and transactions have been eliminated in the consolidated financial statements.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-indent:-.5pt'><b><i>Unaudited Interim Financial Statements</i></b> - The accompanying unaudited financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, the financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments consisting of normal recurring entries necessary for a fair statement of the periods presented for: (a) the financial position; (b) the result of operations; and (c) cash flows, have been made in order to make the financial statements presented not misleading. The results of operations for such interim periods are not necessarily indicative of operations for a full year.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b><i>Going Concern and Management&#146;s Plan</i></b> - Our Consolidated Financial Statements as of and for the period ended April 30, 2019 were prepared on the basis of a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business. Accordingly, they do not give effect to adjustments that could be necessary should we be required to liquidate assets.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>Our ability to continue as a going concern and raise capital for specific strategic initiatives could also depend on obtaining adequate capital to fund operating losses until it becomes profitable. We can give no assurances that any additional capital that it is able to obtain, if any, will be sufficient to meet its needs, or that any such financing will be obtainable on acceptable terms.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Use of estimates</i></b><b> &#150; </b>The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the periods presented. Actual results could differ from these estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the financial statements in the period they are deemed to be necessary. Significant estimates made in the accompanying financial statements include but are not limited to following: those related to revenue recognition, allowance for doubtful accounts and notes receivable and unbilled services, lives and recoverability of equipment and other long-lived assets, realization of deferred tax assets, valuation of equity-based transactions, contingencies and litigation. The Company is subject to uncertainties, such as the impact of future events, economic, environmental and political factors, and changes in the business climate; therefore, actual results may differ from those estimates. When no estimate in a given range is deemed to be better than any other when estimating contingent liabilities, the low end of the range is accrued. Accordingly, the accounting estimates used in the preparation of the Company's financial statements will change as new events occur, as more experience is acquired, as additional information is obtained and as the Company's operating environment changes. Changes in estimates are made when circumstances warrant. Such changes and refinements in estimation methodologies are reflected in reported results of operations; if material, the effects of changes in estimates are disclosed in the notes to the consolidated financial statements.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Cash and cash equivalents</i></b><b> &#150; </b>the company considers all cash in banks, money market funds, and certificates of deposit with a maturity of less than three months to be cash equivalents. Cash balances may exceed federally insured limits. Management believes the financial risk associated with these balances is minimal and has not experienced any losses to date. For the periods presented no balances exceeded the federally insured limits. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Prepaid expenses and other assets</i></b><b> &#150; </b>Prepaid expenses and other current assets consist of various payments the Company has made in advance for goods or services to be received in the future. As of April 30, 2019, prepaid expenses were comprised of advance payments made to third parties for general expenses.&#160; Prepaid general expenses are amortized over the applicable periods which approximate the life of the contract or service period.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Tenant improvements and office equipment</i></b><b> &#150; </b>Tenant improvements and office equipment are recorded at cost and are depreciated under straight line methods over each item's estimated useful life. Management reviews the Company&#146;s tenant improvements and office equipment for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Maintenance and repairs of property and equipment are charged to operations. Major improvements are capitalized. Upon retirement, sale or other disposition of property and equipment, the cost and accumulated depreciation are eliminated from the accounts and any gain or loss is included in operations. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>Tenant improvements and office equipment, net of accumulated amortization and depreciation are comprised of the following:</p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.5in;text-autospace:none'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" width="510" style='width:382.5pt;border-collapse:collapse'> <tr style='height:3.5pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="21" valign="top" style='width:15.8pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>April 30, 2019</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>January 31, 2019</p> </td> </tr> <tr style='height:4.0pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Leasehold improvements</p> </td> <td width="21" valign="bottom" style='width:15.8pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$</p> </td> <td width="72" valign="bottom" style='width:53.7pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>10,951</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 2,200</p> </td> </tr> <tr style='height:4.0pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Office equipment, furniture and fixtures</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&#160;26,276</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>26,276</p> </td> </tr> <tr style='height:3.5pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>37,227</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>28,476</p> </td> </tr> <tr style='height:4.0pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Accumulated amortization and depreciation</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>(25,960)</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>(25,709)</p> </td> </tr> <tr style='height:13.45pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>11,267</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$&#160;&#160;&#160;&#160;&#160;&#160;&#160; 2,767</p> </td> </tr> <tr style='height:.05in'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>Tenant improvements are amortized over the term of the lease, and office equipment is depreciated over its useful lives, which has been deemed by management to be three years. Amortization and depreciation expense related to tenant improvements and office equipment for the periods ended April 30, 2019 and 2018 was $251 and $252, respectively. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Investment in Unconsolidated Entity</i></b><b> &#150; </b>The Company has a significant and non-controlling investment in several entities.&#160; The Company accounts for its investment using the equity method based on the ownership interest and ability to exert significant influence.&#160; Accordingly, investments are recorded at cost, and adjustments to the carrying amount of the investment are recognized in the period incurred.&#160; The Company&#146;s share of the earnings or losses are reported in the other income and expense section of the income statement.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Long-Lived Assets </i></b><b>&#150; </b>In accordance with ASC 350, the Company regularly reviews the carrying value of intangible and other long-lived assets for the existence of facts or circumstances, both internally and externally, that suggest impairment. If impairment testing indicates a lack of recoverability, an impairment loss is recognized by the Company if the carrying amount of a long-lived asset exceeds its fair value. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;margin-top:0in;margin-right:-.9pt;margin-bottom:12.0pt;margin-left:0in;text-align:justify;text-autospace:none'><b><i>Trademarks</i></b> &#150; Trademarks and other intangible assets are stated at cost and are amortized using the straight-line method over fifteen years. Amortization expense for the periods ended April 30, 2019 and 2018 was $333 and $183, respectively.&#160; </p> <p style='margin:0in;margin-bottom:.0001pt;margin-top:0in;margin-right:-.9pt;margin-bottom:12.0pt;margin-left:0in;text-align:justify;text-autospace:none'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Trademarks</font></p> </td> <td width="145" valign="top" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b><u><font style='background:white'>April 30, 2019</font></u></b></p> </td> <td width="147" valign="top" style='width:110.15pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b><u><font style='background:white'>January 31, 2019</font></u></b></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Gross carrying amount</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;13,260&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="147" valign="bottom" style='width:110.15pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;13,260&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Accumulated amortization</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>4,141&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="147" valign="bottom" style='width:110.15pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>3,808&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Net intangible assets</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;&nbsp;&nbsp;9,119&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="147" valign="bottom" style='width:110.15pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;&nbsp;&nbsp;9,452&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Comprehensive Income (Loss)</i></b><b> &#150; </b>Comprehensive income is defined as all changes in stockholders&#146; equity (deficit), exclusive of transactions with owners, such as capital investments. Comprehensive income includes net income or loss, changes in certain assets and liabilities that are reported directly in equity such as translation adjustments on investments in foreign subsidiaries and unrealized gains (losses) on available-for-sale securities. Since the Company&#146;s inception there have been no differences between the Company&#146;s comprehensive loss and net loss. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Net income per share of common stock</i></b> - We present earnings per share (&#147;EPS&#148;) in accordance with ASC 260 <i>Earnings per Share</i>, which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. In the accompanying financial statements, basic earnings per share of common stock is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period.&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i><font style='background:white'>Revenue Recognition</font></i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Effective February 1, 2018, the Company adopted ASC 606 &#151; Revenue from Contracts with Customers using the modified retrospective method.&#160; There was no adjustment required upon transition. Under ASC 606, the Company recognizes revenue applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 &#151; Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><u><font style='background:white'>Consulting Services</font></u></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>We generate revenues from professional services consulting agreements. These arrangements are generally entered into: (1) on an hourly basis for an hourly fee; or, (2) on a fixed fee basis; or (3) a monthly fee basis. Generally, we require a complete or partial prepayment or retainer prior to performing services for hourly or fixed fee contracts.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>For hourly based service contracts, we recognize revenue over time as services are performed and customers simultaneously consume such services. Any advances or retainers received from clients for hourly services are reflected in the Deferred revenue liability account until we recognize revenues as we incur and charge billable hours.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Our fixed fee basis engagements are recognized at a point in time. Generally, our fixed fee arrangements are for completion of a final deliverable or act which is significant to the arrangement as a whole. Although fees are typically collected in advance and the services provided have no alternative use to the Company, there is not a specific enforceable right to payment for the cost of services provided plus a reasonable profit margin.&#160; Accordingly, advances received at contract inception are reflected in the Deferred revenue liability account until the end of the contract when revenue is recognized and the customer takes control of the deliverable.&#160; These engagements do not generally exceed a one-year term. </font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Revenue recognition is affected by a number of factors that change the estimated amount of work required to complete the deliverable, such as changes in scope, timing, awaiting notification of license award from local government, and the level of client involvement. Losses, if any, on fixed-fee engagements are recognized in the period in which the loss first becomes probable and reasonably estimable. During the year ended January 31, 2019 we refunded approximately $26,251 of advances or retainers from fixed fee and hourly engagements that terminated prior to completion. We believe if an engagement terminates prior to completion, we can recover the costs incurred related to the services provided.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Certain of our fixed fee contracts assisting customers with license applications include a success fee which is earned if the customer is awarded a license.&#160; We exclude such variable consideration from the transaction price and recognize the revenue when and if the license is awarded as the uncertainty of the application process creates a probability of significant revenue reversal.&#160; </font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Our monthly fee arrangements are billed on a monthly basis in arrears for a variety of services and are recognized over time as the customers simultaneously consume such services.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>The revenue by contract type for the periods ending April 30, 2019 and 2018 are listed in the table below: </font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> </td> <td width="145" valign="top" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><u><font style='background:white'>2019</font></u></p> </td> <td width="127" valign="top" style='width:95.55pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><u><font style='background:white'>2018</font></u></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Hourly fee contracts</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Fixed fee contracts</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>19,500&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>42,500&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Monthly fee contracts</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>1,045&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>1,313&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;20,545&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;43,813&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Deferred revenue as of April 30, 2019 and January 31, 2019 was $192,500.&#160; The Company is unable to determine timing for revenue recognition at this time for its deferred revenue due to state regulation changes.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><u>Product Sales</u></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Revenue from product sales, including delivery fees, is recognized when an order has been obtained from the customer, the price is fixed and determinable when the order is placed, the product is shipped, title has transferred and collectability is reasonably assured. Given the facts that (1) our customers exercise discretion in determining the timing of when they place their product order; and, (2) the price negotiated in our product sales contracts is fixed and determinable at the time the customer places the order, we are not of the opinion that our product sales indicate or involve any significant financing that would materially change the amount of revenue recognized under the contract, or would otherwise contain a significant financing component for us or the customer under FASB ASC Topic 606.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b><i><font style='background:white'>Reclassifications- </font></i></b><font style='background:white'>Certain account reclassifications have been made to prior period balances to reflect the current period&#146;s presentation format; such reclassifications had no impact on the Company&#146;s consolidated statements of operations or consolidated statements of cash flows and had no material impact on the Company&#146;s consolidated balance sheets.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Stock-Based Compensation</i></b> &#150; The Company records equity instruments at their fair value on the measurement date by utilizing the Black-Scholes option-pricing model.&#160; Stock Compensation for all share-based payments, is recognized as an expense over the requisite service period.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Significant assumptions utilized in determining the fair value of our stock options included the volatility rate, estimated term of the options, risk-free interest rate and forfeiture rate.&#160; The term of the options was assumed to be five years.&#160; The risk-free interest rate was determined utilizing the treasury rate with a maturity equal to the estimated term of the option grant.&#160; Finally, management assumed a 0% forfeiture rate in fiscal year 2018.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Non-employee share-based compensation charges generally are immediately vested and have no future performance requirements by the non-employee and the total share-based compensation charge is recorded in the period of the measurement date.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt'><b><u>Recently Issued Accounting Pronouncements</u></b></p> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company&#146;s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and ensure that there are proper controls in place to ascertain that the Company&#146;s financial statements properly reflect the change.&nbsp;New pronouncements assessed by the Company recently are discussed below:</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>In February 2016, the FASB issued ASU No. 2016-02, <i>Leases (Topic 842)</i>, which supersedes Topic 840, <i>Leases </i>(&#147;ASU 2016-02&#148;). The guidance in this new standard requires lessees to put most leases on their balance sheets but recognize expenses on their income statements in a manner similar to the current accounting and eliminates the current real estate-specific provisions for all entities. The guidance also modifies the classification criteria and the accounting for sales-type and direct financing leases for lessors. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with early adoption permitted. The Company adopted the standard effective February 1, 2019 by recording an immaterial transition adjustment and right of use assets and lease liabilities of approximately $150,000.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>In July 2016, the FASB issued ASU No. 2016-13,&nbsp;<i>Financial Instruments &#150; Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments&nbsp;</i>(&#147;ASU 2016-13&#148;), which among other things, these amendments require the measurement of all expected credit losses of financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 is effective for periods beginning after December 15, 2019, and interim periods within those fiscal years. The Company is in the process of evaluating the impact of the pronouncement.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>In August 2018, the Financial Accounting Standards Board (&#147;FASB&#148;) issued ASU 2018-13, Fair Value Measurement (Topic 820), <i>&#147;Disclosure Framework &#150; Changes to the Disclosure Requirements for Fair Value Measurement&#148;.</i> The amendments in this Update modify certain disclosure requirements of fair value measurements and are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is in the process of evaluation the impact of the pronouncement.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Basis of presentation</i></b> - The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (&quot;U.S. GAAP&quot;). The Company has elected a fiscal year ending on January 31.&#160; Certain balance sheet classifications have been made to prior period balances to reflect the current period&#146;s presentation format.&#160; All intercompany balances and transactions have been eliminated in the consolidated financial statements.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-indent:-.5pt'><b><i>Unaudited Interim Financial Statements</i></b> - The accompanying unaudited financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, the financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments consisting of normal recurring entries necessary for a fair statement of the periods presented for: (a) the financial position; (b) the result of operations; and (c) cash flows, have been made in order to make the financial statements presented not misleading. The results of operations for such interim periods are not necessarily indicative of operations for a full year.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b><i>Going Concern and Management&#146;s Plan</i></b> - Our Consolidated Financial Statements as of and for the period ended April 30, 2019 were prepared on the basis of a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business. Accordingly, they do not give effect to adjustments that could be necessary should we be required to liquidate assets.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>Our ability to continue as a going concern and raise capital for specific strategic initiatives could also depend on obtaining adequate capital to fund operating losses until it becomes profitable. We can give no assurances that any additional capital that it is able to obtain, if any, will be sufficient to meet its needs, or that any such financing will be obtainable on acceptable terms.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Use of estimates</i></b><b> &#150; </b>The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the periods presented. Actual results could differ from these estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the financial statements in the period they are deemed to be necessary. Significant estimates made in the accompanying financial statements include but are not limited to following: those related to revenue recognition, allowance for doubtful accounts and notes receivable and unbilled services, lives and recoverability of equipment and other long-lived assets, realization of deferred tax assets, valuation of equity-based transactions, contingencies and litigation. The Company is subject to uncertainties, such as the impact of future events, economic, environmental and political factors, and changes in the business climate; therefore, actual results may differ from those estimates. When no estimate in a given range is deemed to be better than any other when estimating contingent liabilities, the low end of the range is accrued. Accordingly, the accounting estimates used in the preparation of the Company's financial statements will change as new events occur, as more experience is acquired, as additional information is obtained and as the Company's operating environment changes. Changes in estimates are made when circumstances warrant. Such changes and refinements in estimation methodologies are reflected in reported results of operations; if material, the effects of changes in estimates are disclosed in the notes to the consolidated financial statements.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Cash and cash equivalents</i></b><b> &#150; </b>the company considers all cash in banks, money market funds, and certificates of deposit with a maturity of less than three months to be cash equivalents. Cash balances may exceed federally insured limits. Management believes the financial risk associated with these balances is minimal and has not experienced any losses to date. For the periods presented no balances exceeded the federally insured limits. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Prepaid expenses and other assets</i></b><b> &#150; </b>Prepaid expenses and other current assets consist of various payments the Company has made in advance for goods or services to be received in the future. As of April 30, 2019, prepaid expenses were comprised of advance payments made to third parties for general expenses.&#160; Prepaid general expenses are amortized over the applicable periods which approximate the life of the contract or service period.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Tenant improvements and office equipment</i></b><b> &#150; </b>Tenant improvements and office equipment are recorded at cost and are depreciated under straight line methods over each item's estimated useful life. Management reviews the Company&#146;s tenant improvements and office equipment for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Maintenance and repairs of property and equipment are charged to operations. Major improvements are capitalized. Upon retirement, sale or other disposition of property and equipment, the cost and accumulated depreciation are eliminated from the accounts and any gain or loss is included in operations. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>Tenant improvements and office equipment, net of accumulated amortization and depreciation are comprised of the following:</p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.5in;text-autospace:none'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" width="510" style='width:382.5pt;border-collapse:collapse'> <tr style='height:3.5pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="21" valign="top" style='width:15.8pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>April 30, 2019</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>January 31, 2019</p> </td> </tr> <tr style='height:4.0pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Leasehold improvements</p> </td> <td width="21" valign="bottom" style='width:15.8pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$</p> </td> <td width="72" valign="bottom" style='width:53.7pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>10,951</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 2,200</p> </td> </tr> <tr style='height:4.0pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Office equipment, furniture and fixtures</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&#160;26,276</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>26,276</p> </td> </tr> <tr style='height:3.5pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>37,227</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>28,476</p> </td> </tr> <tr style='height:4.0pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Accumulated amortization and depreciation</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>(25,960)</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>(25,709)</p> </td> </tr> <tr style='height:13.45pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>11,267</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$&#160;&#160;&#160;&#160;&#160;&#160;&#160; 2,767</p> </td> </tr> <tr style='height:.05in'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>Tenant improvements are amortized over the term of the lease, and office equipment is depreciated over its useful lives, which has been deemed by management to be three years. Amortization and depreciation expense related to tenant improvements and office equipment for the periods ended April 30, 2019 and 2018 was $251 and $252, respectively. </p> <p style='margin:0in;margin-bottom:.0001pt;margin-left:.5in;text-autospace:none'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" width="510" style='width:382.5pt;border-collapse:collapse'> <tr style='height:3.5pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="21" valign="top" style='width:15.8pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>April 30, 2019</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>January 31, 2019</p> </td> </tr> <tr style='height:4.0pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Leasehold improvements</p> </td> <td width="21" valign="bottom" style='width:15.8pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$</p> </td> <td width="72" valign="bottom" style='width:53.7pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>10,951</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; 2,200</p> </td> </tr> <tr style='height:4.0pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Office equipment, furniture and fixtures</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&#160;26,276</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>26,276</p> </td> </tr> <tr style='height:3.5pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>37,227</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:3.5pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>28,476</p> </td> </tr> <tr style='height:4.0pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Accumulated amortization and depreciation</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>(25,960)</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:4.0pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>(25,709)</p> </td> </tr> <tr style='height:13.45pt'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>11,267</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:13.45pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>$&#160;&#160;&#160;&#160;&#160;&#160;&#160; 2,767</p> </td> </tr> <tr style='height:.05in'> <td width="294" valign="bottom" style='width:220.5pt;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="21" valign="bottom" style='width:15.8pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="72" valign="bottom" style='width:53.7pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> <td width="40" valign="bottom" style='width:29.65pt;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="84" valign="bottom" style='width:62.85pt;border:none;padding:0in 5.4pt 0in 5.4pt;height:.05in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&nbsp;</p> </td> </tr> </table> 10951 2200 26276 26276 37227 28476 25960 25709 11267 2767 251 252 <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Investment in Unconsolidated Entity</i></b><b> &#150; </b>The Company has a significant and non-controlling investment in several entities.&#160; The Company accounts for its investment using the equity method based on the ownership interest and ability to exert significant influence.&#160; Accordingly, investments are recorded at cost, and adjustments to the carrying amount of the investment are recognized in the period incurred.&#160; The Company&#146;s share of the earnings or losses are reported in the other income and expense section of the income statement.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Long-Lived Assets </i></b><b>&#150; </b>In accordance with ASC 350, the Company regularly reviews the carrying value of intangible and other long-lived assets for the existence of facts or circumstances, both internally and externally, that suggest impairment. If impairment testing indicates a lack of recoverability, an impairment loss is recognized by the Company if the carrying amount of a long-lived asset exceeds its fair value. </p> <p style='margin:0in;margin-bottom:.0001pt;margin-top:0in;margin-right:-.9pt;margin-bottom:12.0pt;margin-left:0in;text-align:justify;text-autospace:none'><b><i>Trademarks</i></b> &#150; Trademarks and other intangible assets are stated at cost and are amortized using the straight-line method over fifteen years. Amortization expense for the periods ended April 30, 2019 and 2018 was $333 and $183, respectively.&#160; </p> <p style='margin:0in;margin-bottom:.0001pt;margin-top:0in;margin-right:-.9pt;margin-bottom:12.0pt;margin-left:0in;text-align:justify;text-autospace:none'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Trademarks</font></p> </td> <td width="145" valign="top" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b><u><font style='background:white'>April 30, 2019</font></u></b></p> </td> <td width="147" valign="top" style='width:110.15pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b><u><font style='background:white'>January 31, 2019</font></u></b></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Gross carrying amount</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;13,260&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="147" valign="bottom" style='width:110.15pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;13,260&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Accumulated amortization</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>4,141&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="147" valign="bottom" style='width:110.15pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>3,808&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Net intangible assets</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;&nbsp;&nbsp;9,119&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="147" valign="bottom" style='width:110.15pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;&nbsp;&nbsp;9,452&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> </table> 333 183 <p style='margin:0in;margin-bottom:.0001pt;margin-top:0in;margin-right:-.9pt;margin-bottom:12.0pt;margin-left:0in;text-align:justify;text-autospace:none'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Trademarks</font></p> </td> <td width="145" valign="top" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b><u><font style='background:white'>April 30, 2019</font></u></b></p> </td> <td width="147" valign="top" style='width:110.15pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b><u><font style='background:white'>January 31, 2019</font></u></b></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Gross carrying amount</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;13,260&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="147" valign="bottom" style='width:110.15pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;13,260&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Accumulated amortization</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>4,141&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="147" valign="bottom" style='width:110.15pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>3,808&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Net intangible assets</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;&nbsp;&nbsp;9,119&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="147" valign="bottom" style='width:110.15pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;&nbsp;&nbsp;9,452&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> </table> 13260 13260 4141 3808 9119 9452 <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Comprehensive Income (Loss)</i></b><b> &#150; </b>Comprehensive income is defined as all changes in stockholders&#146; equity (deficit), exclusive of transactions with owners, such as capital investments. Comprehensive income includes net income or loss, changes in certain assets and liabilities that are reported directly in equity such as translation adjustments on investments in foreign subsidiaries and unrealized gains (losses) on available-for-sale securities. Since the Company&#146;s inception there have been no differences between the Company&#146;s comprehensive loss and net loss. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'><b><i>Net income per share of common stock</i></b> - We present earnings per share (&#147;EPS&#148;) in accordance with ASC 260 <i>Earnings per Share</i>, which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. In the accompanying financial statements, basic earnings per share of common stock is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period.&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i><font style='background:white'>Revenue Recognition</font></i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Effective February 1, 2018, the Company adopted ASC 606 &#151; Revenue from Contracts with Customers using the modified retrospective method.&#160; There was no adjustment required upon transition. Under ASC 606, the Company recognizes revenue applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 &#151; Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><u><font style='background:white'>Consulting Services</font></u></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>We generate revenues from professional services consulting agreements. These arrangements are generally entered into: (1) on an hourly basis for an hourly fee; or, (2) on a fixed fee basis; or (3) a monthly fee basis. Generally, we require a complete or partial prepayment or retainer prior to performing services for hourly or fixed fee contracts.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>For hourly based service contracts, we recognize revenue over time as services are performed and customers simultaneously consume such services. Any advances or retainers received from clients for hourly services are reflected in the Deferred revenue liability account until we recognize revenues as we incur and charge billable hours.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Our fixed fee basis engagements are recognized at a point in time. Generally, our fixed fee arrangements are for completion of a final deliverable or act which is significant to the arrangement as a whole. Although fees are typically collected in advance and the services provided have no alternative use to the Company, there is not a specific enforceable right to payment for the cost of services provided plus a reasonable profit margin.&#160; Accordingly, advances received at contract inception are reflected in the Deferred revenue liability account until the end of the contract when revenue is recognized and the customer takes control of the deliverable.&#160; These engagements do not generally exceed a one-year term. </font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Revenue recognition is affected by a number of factors that change the estimated amount of work required to complete the deliverable, such as changes in scope, timing, awaiting notification of license award from local government, and the level of client involvement. Losses, if any, on fixed-fee engagements are recognized in the period in which the loss first becomes probable and reasonably estimable. During the year ended January 31, 2019 we refunded approximately $26,251 of advances or retainers from fixed fee and hourly engagements that terminated prior to completion. We believe if an engagement terminates prior to completion, we can recover the costs incurred related to the services provided.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Certain of our fixed fee contracts assisting customers with license applications include a success fee which is earned if the customer is awarded a license.&#160; We exclude such variable consideration from the transaction price and recognize the revenue when and if the license is awarded as the uncertainty of the application process creates a probability of significant revenue reversal.&#160; </font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Our monthly fee arrangements are billed on a monthly basis in arrears for a variety of services and are recognized over time as the customers simultaneously consume such services.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>The revenue by contract type for the periods ending April 30, 2019 and 2018 are listed in the table below: </font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> </td> <td width="145" valign="top" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><u><font style='background:white'>2019</font></u></p> </td> <td width="127" valign="top" style='width:95.55pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><u><font style='background:white'>2018</font></u></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Hourly fee contracts</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Fixed fee contracts</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>19,500&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>42,500&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Monthly fee contracts</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>1,045&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>1,313&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;20,545&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;43,813&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Deferred revenue as of April 30, 2019 and January 31, 2019 was $192,500.&#160; The Company is unable to determine timing for revenue recognition at this time for its deferred revenue due to state regulation changes.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><u>Product Sales</u></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Revenue from product sales, including delivery fees, is recognized when an order has been obtained from the customer, the price is fixed and determinable when the order is placed, the product is shipped, title has transferred and collectability is reasonably assured. Given the facts that (1) our customers exercise discretion in determining the timing of when they place their product order; and, (2) the price negotiated in our product sales contracts is fixed and determinable at the time the customer places the order, we are not of the opinion that our product sales indicate or involve any significant financing that would materially change the amount of revenue recognized under the contract, or would otherwise contain a significant financing component for us or the customer under FASB ASC Topic 606.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> </td> <td width="145" valign="top" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><u><font style='background:white'>2019</font></u></p> </td> <td width="127" valign="top" style='width:95.55pt;padding:0in 5.4pt 0in 5.4pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><u><font style='background:white'>2018</font></u></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Hourly fee contracts</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Fixed fee contracts</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>19,500&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>42,500&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>Monthly fee contracts</font></p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>1,045&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>1,313&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> <tr align="left"> <td width="221" valign="top" style='width:165.4pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> </td> <td width="145" valign="bottom" style='width:109.1pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;20,545&nbsp;&nbsp;&nbsp;</font></p> </td> <td width="127" valign="bottom" style='width:95.55pt;border:none;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'><font style='background:white'>$&nbsp;43,813&nbsp;&nbsp;&nbsp;</font></p> </td> </tr> </table> 0 0 19500 42500 1045 1313 20545 43813 <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b><i><font style='background:white'>Reclassifications- </font></i></b><font style='background:white'>Certain account reclassifications have been made to prior period balances to reflect the current period&#146;s presentation format; such reclassifications had no impact on the Company&#146;s consolidated statements of operations or consolidated statements of cash flows and had no material impact on the Company&#146;s consolidated balance sheets.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b><i>Stock-Based Compensation</i></b> &#150; The Company records equity instruments at their fair value on the measurement date by utilizing the Black-Scholes option-pricing model.&#160; Stock Compensation for all share-based payments, is recognized as an expense over the requisite service period.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Significant assumptions utilized in determining the fair value of our stock options included the volatility rate, estimated term of the options, risk-free interest rate and forfeiture rate.&#160; The term of the options was assumed to be five years.&#160; The risk-free interest rate was determined utilizing the treasury rate with a maturity equal to the estimated term of the option grant.&#160; Finally, management assumed a 0% forfeiture rate in fiscal year 2018.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Non-employee share-based compensation charges generally are immediately vested and have no future performance requirements by the non-employee and the total share-based compensation charge is recorded in the period of the measurement date.</p> <p style='margin:0in;margin-bottom:.0001pt'><b><u>Recently Issued Accounting Pronouncements</u></b></p> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company&#146;s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and ensure that there are proper controls in place to ascertain that the Company&#146;s financial statements properly reflect the change.&nbsp;New pronouncements assessed by the Company recently are discussed below:</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>In February 2016, the FASB issued ASU No. 2016-02, <i>Leases (Topic 842)</i>, which supersedes Topic 840, <i>Leases </i>(&#147;ASU 2016-02&#148;). The guidance in this new standard requires lessees to put most leases on their balance sheets but recognize expenses on their income statements in a manner similar to the current accounting and eliminates the current real estate-specific provisions for all entities. The guidance also modifies the classification criteria and the accounting for sales-type and direct financing leases for lessors. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with early adoption permitted. The Company adopted the standard effective February 1, 2019 by recording an immaterial transition adjustment and right of use assets and lease liabilities of approximately $150,000.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>In July 2016, the FASB issued ASU No. 2016-13,&nbsp;<i>Financial Instruments &#150; Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments&nbsp;</i>(&#147;ASU 2016-13&#148;), which among other things, these amendments require the measurement of all expected credit losses of financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. In addition, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 is effective for periods beginning after December 15, 2019, and interim periods within those fiscal years. The Company is in the process of evaluating the impact of the pronouncement.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>In August 2018, the Financial Accounting Standards Board (&#147;FASB&#148;) issued ASU 2018-13, Fair Value Measurement (Topic 820), <i>&#147;Disclosure Framework &#150; Changes to the Disclosure Requirements for Fair Value Measurement&#148;.</i> The amendments in this Update modify certain disclosure requirements of fair value measurements and are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is in the process of evaluation the impact of the pronouncement.</p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>Note 3 &#150; Going concern:</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Since inception, we have not achieved profitable operations, and have cumulative losses through April 30, 2019 of $8.9 million. The Company&#146;s losses to date raise substantial doubt about the Company&#146;s ability to continue as a going concern. The Company&#146;s ability to continue as a going concern is dependent upon the Company&#146;s achieving a sustainable level of profitability. The Company intends to continue financing its future development activities and its working capital needs largely from the private sale of the Company&#146;s securities, with additional funding from other traditional financing sources, including convertible term notes, until such time that funds provided by operations are sufficient to fund working capital requirements. However, the financial statements of the Company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilitie</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b>Note 4 &#150; Fair value of financial instruments</b> </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The carrying amounts of cash and current liabilities approximate fair value because of the short maturity of these items. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment, and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. We do not hold or issue financial instruments for trading purposes, nor do we utilize derivative instruments in the management of our foreign exchange, commodity price or interest rate market risks.</p> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The FASB Codification clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. It also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows: </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0"> <tr align="left"> <td valign="top" style='padding:0in .25in 0in .25in'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Level 1:</p> </td> <td valign="top" style='padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Quoted prices in active markets for identical assets or liabilities.</p> </td> </tr> <tr align="left"> <td valign="top" style='padding:0in .25in 0in .25in'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Level 2:</p> </td> <td valign="top" style='padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability.</p> </td> </tr> <tr align="left"> <td valign="top" style='padding:0in .25in 0in .25in'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Level 3:</p> </td> <td valign="top" style='padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.</p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.</p> <p style='margin:0in;margin-bottom:.0001pt'><b>Note 5 &#150; Commitments and contingencies</b></p> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The Company entered into a right-of-use operating lease agreement with an affiliate for the Company&#146;s corporate office needs, consisting of 4,000 square feet of office space. The lease is for a 4-year period ending October 31, 2021. This lease to the Company is on the same terms and conditions as is the direct lease between the affiliate and the independent lessor.&#160; The office space lease includes in-substance fixed lease payments, and does not provide an implicit rate, the remaining lease term for the office space is 30 months.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>As of April 30, 2019, maturities of the lease liability are as follows:</p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" width="337" style='width:252.45pt;border-collapse:collapse'> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in .1in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>For the Fiscal Year Ending</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>&#160;January 31,</b></p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>&nbsp;</b></p> </td> <td width="23%" colspan="2" valign="bottom" style='width:23.04%;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;text-autospace:none'>&nbsp;</p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 0in 8.1pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>2020</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="19%" valign="bottom" style='width:19.48%;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>41,227</p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 0in 8.1pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>2021</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="19%" valign="bottom" style='width:19.48%;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>56,250 </p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 1.0pt 8.1pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>2022</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0in 0in 1.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="19%" valign="bottom" style='width:19.48%;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>42,750</p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0in 0in 1.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 1.0pt 8.1pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Thereafter</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0in 0in 1.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;border:none;border-bottom:solid windowtext 1.0pt;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="19%" valign="bottom" style='width:19.48%;border:none;border-bottom:solid windowtext 1.0pt;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&#151; </p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0in 0in 1.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 0in .5in'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:-10.1pt;text-autospace:none'>Total minimum lease payments</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;border:none;border-bottom:double windowtext 1.5pt;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>$</p> </td> <td width="19%" valign="bottom" style='width:19.48%;border:none;border-bottom:double windowtext 1.5pt;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>140,227</p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>During the periods ended April 30, 2019 and 2018, rent expense was $17,963 and $12,516, respectively. </p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" width="337" style='width:252.45pt;border-collapse:collapse'> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in .1in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>For the Fiscal Year Ending</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>&#160;January 31,</b></p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>&nbsp;</b></p> </td> <td width="23%" colspan="2" valign="bottom" style='width:23.04%;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;text-autospace:none'>&nbsp;</p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 0in 8.1pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>2020</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="19%" valign="bottom" style='width:19.48%;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>41,227</p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 0in 8.1pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>2021</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="19%" valign="bottom" style='width:19.48%;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>56,250 </p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 1.0pt 8.1pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>2022</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0in 0in 1.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="19%" valign="bottom" style='width:19.48%;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>42,750</p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0in 0in 1.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 1.0pt 8.1pt'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>Thereafter</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0in 0in 1.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;border:none;border-bottom:solid windowtext 1.0pt;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="19%" valign="bottom" style='width:19.48%;border:none;border-bottom:solid windowtext 1.0pt;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>&#151; </p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0in 0in 1.0pt 0in'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> <tr align="left"> <td width="73%" valign="bottom" style='width:73.2%;padding:0in 0in 0in .5in'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:-10.1pt;text-autospace:none'>Total minimum lease payments</p> </td> <td width="1%" valign="bottom" style='width:1.98%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> <td width="3%" valign="bottom" style='width:3.54%;border:none;border-bottom:double windowtext 1.5pt;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>$</p> </td> <td width="19%" valign="bottom" style='width:19.48%;border:none;border-bottom:double windowtext 1.5pt;padding:0'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right;text-autospace:none'>140,227</p> </td> <td width="1%" valign="bottom" style='width:1.78%;padding:0'> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> </td> </tr> </table> 41227 56250 42750 0 140227 17963 12516 <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><b>Note 6 &#150; Notes Receivable</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>The Company has management and licensing agreements with a private entity in Puerto Rico 39% owned by the Company&#146;s CEO, Erin Phillips, to operate four dispensaries and one cultivation operation in Puerto Rico. In conjunction with these agreements, the Company as begun providing funds to operate the Puerto Rico operations, which will be evidenced by a promissory note. The terms have not been finalized on this note and currently there is no specified terms to the agreement. Through April 30, 2019 the Company has advanced </font><font style='background:white'>$280,607</font><font style='background:white'> related to the note. </font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt'><font style='background:white'>The Company has management and licensing agreements with two private entities in Oklahoma.&#160; STWC has a 25% ownership in 2600 Meridian LLC, and an option to acquire 25% interest in HWH Farms, LLC.&#160; In conjunction with these agreements, the Company has begun providing funds for start-up and development costs, which will be evidenced by a promissory note. The terms have not been finalized on these notes and currently there is no specified terms to the agreement. Through April 30, 2019 the Company has advanced </font><font style='background:white'>$55,110</font><font style='background:white'> to 2600 Meridian, LLC and $157,802 to HWH Farms, LLC related to the notes.</font></p> 280607 55110 <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b>Note 7 &#150; Related Party</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>The Company has entered into separate management and licensing contracts with STWC Sorrento Valley, LLC which is partially owned by the Company's CEO, Erin Phillips. Ms. Phillips owns 27.5% of the STWC Sorrento Valley, LLC.&#160; Ms. Phillips allocated $200,000 of the Green Acres note to fund the related project in California as directed by the note agreement which reduced the liability to Ms. Phillips for loan advances received as of April 30, 2019.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The Company manages its cash flow by utilizing related party loans.&#160; During the period ended April 30, 2019 and 2018 the company borrowed <font style='background:white'>$14,369</font><font style='background:white'> and </font><font style='background:white'>$8,765</font><font style='background:white'>, respectively, from related parties to fund operations. The loans do </font><font style='background:white'>no</font><font style='background:white'>t carry any interest. The Company converted an accrued expense with a related party to a note payable in the amount of $60,300.&#160; The note has a maturity of </font><font style='background:white'>May 2020</font><font style='background:white'>, </font><font style='background:white'>$48,240</font><font style='background:white'> is reflected in Long-term loan to related party on the balance sheet.&#160; As of April 30, 2019, and 2018, the Company reflected current loans payable to related parties of </font><font style='background:white'>$29,349</font><font style='background:white'> and </font><font style='background:white'>$32,021</font><font style='background:white'>, respectively.</font><font style='background:white'>&#160; </font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><font style='background:white'>The Company received $125,000 for the benefit of the Puerto Rico entities and is disbursing these funds to operate the Puerto Rico operations, the balance as of April 30, 2019 was $65,499.&#160; In addition, the Company received $50,000 for the benefit of 2600 Meridian LLC, the funds have been used to cover start-up and development costs, the balance as of April 30, 2019 was $25,502.&#160; The funds held for related party entities is held in restricted cash liabilities on the balance sheet.</font></p> 14369 8765 0.0000 2020-05-01 2020-05-31 48240 29349 32021 <p style='margin:0in;margin-bottom:.0001pt;background:white;text-autospace:none'><b>Note 8 &#150; Notes Payable</b></p> <p style='margin:0in;margin-bottom:.0001pt;background:white;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'><i><u>Note purchase and security agreement</u></i> &#150; On August 29, 2018, the Company entered into a Note Purchase and Security Agreement with Richland Fund, LLC., a Delaware limited liability company. Pursuant to the Agreement, Richland agreed </p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>to purchase Convertible Promissory Notes of the Company in the aggregate principal amount of $225,000, funded in three tranches, (i) $100,000.00 (the &quot;First Note&quot;), (ii) $67,000.00 (the &quot;Second Note&quot;), and (iii) the balance of $58,000.00 (the &quot;Third Note&quot;). The Notes bear 12% interest per annum, with the last payment under the Notes due December 15, 2020. The Notes are secured by all assets of the Company and guarantees from Shawn and Erin Phillips. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-autospace:none'>The Notes are convertible into common stock of the Company. The conversion price will be equal to the lower of (i) $0.15 cents per share (ii) or the average of the closing bid price of the Company's common stock taken over the three trading days prior to conversion or (iii) upon any issuance by the Company of common stock, or a security that is convertible into common stock, at a price lower than a net receipt to the Company of $0.15 per share, at such price that shall be at the same discount ratio as on the Funding Date. The conversion price of the Notes will be further subject to proportional adjustment for stock splits, reverse stock splits or combinations of shares, stock dividends, and the like. There are penalties for failure to timely deliver conversion shares.&#160; The company recognized a beneficial conversion feature on the notes as a discount and additional paid in capital of $225,000.&#160; The company has recognized $40,909 in interest expense for the amortization of the debt discount for the period ending April 30, 2019.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>In connection with the funding agreement, the Company agreed to form and organize a subsidiary.&#160; The Company and lender are in discussions regarding the assets to be held in the subsidiary, nothing has been finalized as of the issuance date.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><i><u>Loan Agreement </u></i>&#150; On April 6, 2018, the Company entered into a loan agreement with Green Acres Partners A, LLC, (the &#147;lender&#148;) whereby the lender agreed to loan to the Company $205,000.&#160; The loan proceeds are to be used specifically for the capital needs of two related party projects in San Diego, California.&#160; The interest rate on the notes is 12% per annum and monthly interest payments are due the first day beginning no later than August 1, 2019; thereafter the Company shall pay interest and principal on 60% of the Company&#146;s ownership percentage of the available profits from the San Diego projects.&#160;&#160; The loan is personally guaranteed by Shawn Phillips, the husband of Erin Phillips, our CEO. </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><i><u>Secured Promissory Note</u></i> &#150; On December 7, 2018, the Company entered into a 15% Secured Promissory Note with Richland Fund, LLC, (the &#147;lender&#148;) whereby the lender agreed to loan to the Company $126,100.&#160; The interest rate on the notes is 15% per annum and monthly interest payments are due the first day each month beginning January 1, 2019.&#160; If any interest payment remains unpaid and the lender has not declared the entire principal and unpaid accrued interest due and payable, the interest rate on that amount only will be increased to 20% per annum, until the past due interest amount is paid in full.&#160; The note originally matured on March 7, 2019 but was extended to a maturity date of August 1, 2019.&#160; </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><i><u><font style='background:white'>Securities Purchase Agreement</font></u></i><font style='background:white'> </font>&#150; <font style='background:white'>On </font><font style='background:white'>February 13, 2019</font><font style='background:white'>, the </font><font style='background:white'>Company entered into a Securities Purchase Agreement with Power Up Lending Group Ltd. pursuant to which Power Up agreed to purchase a convertible promissory note</font><font style='background:white'> in the face amount of </font><font style='background:white'>$103,000</font><font style='background:white'>. On </font><font style='background:white'>February 15, 2019</font><font style='background:white'>, the </font><font style='background:white'>Company</font><font style='background:white'> issued the Note</font><font style='background:white'>. The Note matures on </font><font style='background:white'>February 13, 2020</font><font style='background:white'>, and bears interest at </font><font style='background:white'>12%</font><font style='background:white'> per annum, increasing to 22% after maturity.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>On March 18, 2019, the Company entered into the second tranche of the potential $1,000,000 funding with Power Up.&nbsp; The Company entered into a second Securities Purchase Agreement pursuant to which Power Up agreed to purchase a convertible promissory note in the face amount of $53,000. On March 18, 2019, the Company issued the Note. The Note matures on March 18, 2020, and bears interest at 12% per annum, increasing to 22% after maturity.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>Under the Note, Power Up may convert all or a portion of the outstanding principal of the Note into shares of common stock of the Company beginning on the date which is 180 days from the date of the Note, at a price equal to 61% of the lowest trading price during the 20 trading day period ending on the last complete trading date prior to the date of conversion; provided, however, that Power Up may not convert the Note to the extent that such conversion would result in beneficial ownership by Power Up and its affiliates of more than 4.99% of the Company&#146;s issued and outstanding Common Stock.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>If the Company prepays the Note within 30 days of the date of the Note, the Company must pay all of the principal at a cash redemption premium of 110%; if the prepayment is made between the 31<sup>st</sup>&nbsp;day and the 60<sup>th</sup>&nbsp;day after the date of the Note, then the redemption premium is 115%; if the prepayment is made from the 61<sup>st</sup>&nbsp;to the 90<sup>th</sup>&nbsp;day after date of the Note, then the redemption premium is 120%; if the prepayment is made from the 91<sup>st</sup>&nbsp;to the 120<sup>th</sup>&nbsp;day after the date of the Note, then the redemption premium is 125%; if the prepayment is made from the 121<sup>st</sup>&nbsp;to the 150<sup>th</sup>&nbsp;day after the date of the Note, then the redemption premium is 130%; and if the prepayment is made from the 151<sup>st</sup>&nbsp;to the 180<sup>th</sup>&nbsp;day after the date of the Note, then the redemption premium is 135%. The Note cannot be prepaid after the 180<sup>th</sup>&nbsp;day following the date of the Note.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>The Company is required to reserve for issuance upon conversion of the Note, six times the number of shares that would be issuable upon full conversion of the Note, assuming the 4.99% limitation were not in effect.&nbsp; In connection with the Note, the Company has caused its transfer agent to reserve initially 1,494,276 shares of Common Stock. The Company received a net amount of $150,000, with $6,000 paid for Power Up&#146;s legal and due diligence expenses.</p> 2018-08-29 Company Note Purchase and Security Agreement 225000 0.1200 2020-12-15 secured by all assets of the Company and guarantees from Shawn and Erin Phillips convertible into common stock 225000 40909 2018-04-06 Company loan agreement 205000 0.1200 monthly interest payments are due the first day beginning no later than August 1, 2019 personally guaranteed by Shawn Phillips 2018-12-07 Company 0.1500 Secured Promissory Note 126100 2019-08-01 2019-02-13 Company entered into a Securities Purchase Agreement with Power Up Lending Group Ltd. pursuant to which Power Up agreed to purchase a convertible promissory note 103000 2019-02-15 Company issued the Note Company 2020-02-13 0.1200 2019-03-18 Company entered into the second tranche of the potential $1,000,000 funding with Power Up 53000 2019-03-18 Company issued the Note Company 2020-03-18 0.1200 150000 6000 <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b>Note 9 &#150; Stockholders Equity</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b><i>Common Stock</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>On February 4, 2019, the Company initiated a private equity offering to accredited investors (the &quot;Offering&quot;) in accordance with Regulation D under the Securities Act of 1933 (&quot;Securities Act&quot;). The Offering consisted of 2,000,000 units with each unit consisting of one share of the Company's Common Stock and a warrant to purchase an additional share of common for $2.00 at any time prior to January 31, 2022.&#160; During the three months ended April 30, 2019, 80,000 units were sold at a price per unit of $1.00, for offering proceeds of $80,000. The company allocated proceeds at the estimated fair value of the common shares and warrants for value of $41,353 and $38,647, respectively.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b><i>Warrants</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" width="647" style='width:485.25pt;border-collapse:collapse'> <tr style='height:35.1pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>Number of Warrants</b></p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>&nbsp;</b></p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>Exercise Price</b></p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>Wtgd Avg Calculation</b></p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>Wtgd Avg Remining Life</b></p> </td> </tr> <tr style='height:11.65pt'> <td width="165" valign="bottom" style='width:123.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>Balance at 1/31/2018</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>2,224,700&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;5.00&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;&nbsp;&nbsp;11,123,500&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1.00&nbsp;&nbsp;&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Granted</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>2,000,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>0.16&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;322,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Exercised</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>(311,000)&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>0.16&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;(49,650)&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Cancelled</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>(2,013,700)&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>5.00&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;(11,091,850)&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:11.65pt'> <td width="165" valign="bottom" style='width:123.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>Balance at 1/31/2019</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1,900,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;0.16&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;304,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1.71&nbsp;&nbsp;&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Granted</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>80,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>2.00&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;160,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Exercised</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Cancelled</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:11.65pt'> <td width="165" valign="bottom" style='width:123.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>Balance at 4/30/19</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1,980,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;0.23&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;464,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1.52&nbsp;&nbsp;&nbsp;</p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b><i>Stock Options</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The Company has 250,000 stock options outstanding at April 30, 2019 and recognized $13,180 in stock compensation expense for the period ended April 30, 2019.&#160; The Company has $184,538 in unrecognized stock compensation expense.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The Company accounts for unit-based compensation using the Black-Scholes model to estimate the fair value of unit-based awards at the date of grant. The Black-Scholes model requires the use of highly subjective assumptions, including value of the enterprise, expected life, expected volatility, and expected risk-free rate of return.&#160; Other reasonable assumptions could provide differing results.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;text-autospace:none'>The Company amortizes the fair value of stock options on a ratable basis over the requisite service periods, which are generally the vesting periods.&#160; The expected life of awards granted represents the period of time that they are expected to be outstanding.&#160; The Company determines the expected life based on historical experience with similar awards, giving consideration to the contractual terms, expected time to a liquidity event, exercise patterns, and post-vesting forfeitures.&#160; The Company estimates volatility based on the historical volatility of comparable company&#146;s common stock over the most recent </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>period corresponding with the estimated expected life of the award.&#160; The Company bases the risk-free interest rate used in the Black-Scholes model on the implied yield currently available on U.S. Treasury zero-coupon issues with an equivalent term equal to the expected life of the award. The Company uses historical data to estimate pre-vesting option forfeitures and record unit-based compensation for those awards that are expected to vest. The Company adjusts unit-based compensation </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>for changes to the estimate of expected equity award forfeitures based on actual forfeiture experience.&#160; The effect of adjusting the forfeiture rate is recognized in the period the forfeiture estimate is changed.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>The assumptions used in the fair value calculations are as follows for the period ended April 30, 2019:</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr align="left"> <td width="252" valign="top" style='width:189.0pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-top:6.0pt;text-align:justify'>Expected term (years)</p> </td> <td width="60" valign="top" style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-top:6.0pt;text-align:right'>5</p> </td> </tr> <tr align="left"> <td width="252" valign="top" style='width:189.0pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Risk-free interest rate</p> </td> <td width="60" valign="top" style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>2.73%</p> </td> </tr> <tr align="left"> <td width="252" valign="top" style='width:189.0pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Volatility</p> </td> <td width="60" valign="top" style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>218%</p> </td> </tr> <tr align="left"> <td width="252" valign="top" style='width:189.0pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Expected dividend yield</p> </td> <td width="60" valign="top" style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>0.00%</p> </td> </tr> </table> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" width="647" style='width:485.25pt;border-collapse:collapse'> <tr style='height:35.1pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>Number of Warrants</b></p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>&nbsp;</b></p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>Exercise Price</b></p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>Wtgd Avg Calculation</b></p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:35.1pt'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><b>Wtgd Avg Remining Life</b></p> </td> </tr> <tr style='height:11.65pt'> <td width="165" valign="bottom" style='width:123.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>Balance at 1/31/2018</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>2,224,700&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;5.00&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;&nbsp;&nbsp;11,123,500&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1.00&nbsp;&nbsp;&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Granted</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>2,000,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>0.16&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;322,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Exercised</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>(311,000)&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>0.16&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;(49,650)&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Cancelled</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>(2,013,700)&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>5.00&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;(11,091,850)&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:11.65pt'> <td width="165" valign="bottom" style='width:123.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>Balance at 1/31/2019</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1,900,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;0.16&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;304,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1.71&nbsp;&nbsp;&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Granted</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>80,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>2.00&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;160,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Exercised</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt;text-indent:7.95pt'>Cancelled</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>-&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:10.9pt'> <td width="165" valign="bottom" style='width:123.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:10.9pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> <tr style='height:11.65pt'> <td width="165" valign="bottom" style='width:123.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>Balance at 4/30/19</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="106" valign="bottom" style='width:79.45pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1,980,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="80" valign="bottom" style='width:59.7pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;0.23&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="120" valign="bottom" style='width:90.2pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;464,000&nbsp;&nbsp;&nbsp;</p> </td> <td width="22" valign="bottom" style='width:16.5pt;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="89" valign="bottom" style='width:66.4pt;border-top:solid windowtext 1.0pt;border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;background:white;padding:0in 5.4pt 0in 5.4pt;height:11.65pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1.52&nbsp;&nbsp;&nbsp;</p> </td> </tr> </table> 2224700 5.00 11123500 P1Y 2000000 0.16 322000 311000 0.16 49650 2013700 5.00 11091850 1900000 0.16 304000 P1Y8M16D 80000 2.00 160000 0 0 0 0 0 0 1980000 0.23 464000 P1Y6M7D 250000 13180 184538 Black-Scholes model <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr align="left"> <td width="252" valign="top" style='width:189.0pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;margin-top:6.0pt;text-align:justify'>Expected term (years)</p> </td> <td width="60" valign="top" style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;margin-top:6.0pt;text-align:right'>5</p> </td> </tr> <tr align="left"> <td width="252" valign="top" style='width:189.0pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Risk-free interest rate</p> </td> <td width="60" valign="top" style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>2.73%</p> </td> </tr> <tr align="left"> <td width="252" valign="top" style='width:189.0pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Volatility</p> </td> <td width="60" valign="top" style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>218%</p> </td> </tr> <tr align="left"> <td width="252" valign="top" style='width:189.0pt;padding:0in 5.4pt 0in 5.4pt'> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>Expected dividend yield</p> </td> <td width="60" valign="top" style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>0.00%</p> </td> </tr> </table> P5Y 0.0273 2.1800 0.0000 <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'><b>Note 10 &#150; Subsequent Events</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>GAAP requires an entity to disclose events that occur after the balance sheet date but before financial statements are issued or are available to be issued (&#147;subsequent events&#148;) as well as the date through which an entity has evaluated subsequent events. There are two types of subsequent events. The first type consists of events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements, (&#147;recognized subsequent events&#148;). The second type consists of events that provide evidence about conditions that did not exist at the date of the balance sheet but arose subsequent to that date (&#147;non-recognized subsequent events&#148;). </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>On May 1, 2019 we received funds from Crown Bridge Partners, LLC (&quot;Crown Bridge&quot;) under a Securities Purchase Agreement dated April 18, 2019 (the &#147;SPA&#148;).&nbsp; Under the terms of the SPA, we received a total of $95,000, after an original issue discount of $5,000, and issued a convertible promissory note dated April 18, 2019, in the principal amount of $100,000 (the &quot; Note&quot;).&nbsp; In addition, we reimbursed Crown Bridge $2,000 for its legal fees.&nbsp; We also issued warrants to purchase 60,606 shares of our common stock (the &#147;Warrant&#148;) associated with this transaction.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>The maturity date of the Note is 12 months from April 18, 2019. The Note bears interest at 12% per annum at its face amount, with a default rate of 15% per annum (or the maximum amount permitted by law). If we prepay the Note through the 180<sup>th</sup>&nbsp;day following the date thereof, we must pay all of the principal and interest with a prepayment penalty ranging from 135% to 150%. After the 180<sup>th</sup>&nbsp;day we have no further right of prepayment.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>Crown Bridge may, at any time, convert all or any part of the outstanding principal of the Note into shares of our common stock at a price per share equal to 60% (representing a 40% discount rate) of the lowest trading price of the common stock during the 20 trading day period ending on the last complete trading day prior to the date of conversion. If the conversion price is equal to or lower than $0.35 per share, an additional 15% discount will be applied (resulting in a 55% discount rate, assuming no other adjustments); if we are unable to deliver converted shares via DWAC, an additional 10% discount will be applied (resulting in a discount rate of 50%, assuming no other adjustments); if we fail to comply with our reporting requirements under the Exchange Act, an additional 15% discount will be applied (resulting in a discount rate of 55%, assuming no other adjustments); and if we fail to maintain our status as &quot;DTC Eligible&quot; or if at any time the conversion price is lower than $0.10, an additional 10% discount will be applied (resulting in a discount of 65%, assuming no other adjustments except for the 15% discount due to the conversion price below $0.35).&nbsp; Crown Bridge may not convert the Note to the extent that such conversion would result in beneficial ownership by Crown Bridge and its affiliates of more than 4.99% of our issued and outstanding common stock.&nbsp; We have also granted piggy-back registration rights for the shares issuable upon conversion of the Note.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>The Note contains certain representations, warranties, covenants (both affirmative and negative), and events of default, including if our common stock is suspended or delisted for trading, or if we are delinquent in our periodic report filings with the SEC. In the event of a default, at the option of Crown Bridge, it may consider the Note immediately due and payable and the amount of repayment increases to 150% of the outstanding balance of the Note.&nbsp; The Note also grants Crown Bridge a right of first refusal for any future capital raises or financings by us.&nbsp; It also contains a most favored nations provision for any more favorable terms in future financing transactions by us.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;background:white'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;background:white'>The Warrant may be exercised at any time through the second anniversary date of the Note. The exercise price per share of common stock under the Warrant is $1.65 per share, subject to adjustment, including cashless exercise.&nbsp; The Warrant also contains a most favored nations provision.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>GAAP requires an entity to disclose events that occur after the balance sheet date but before financial statements are issued or are available to be issued (&#147;subsequent events&#148;) as well as the date through which an entity has evaluated subsequent events. There are two types of subsequent events. The first type consists of events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements, (&#147;recognized subsequent events&#148;). The second type consists of events that provide evidence about conditions that did not exist at the date of the balance sheet but arose subsequent to that date (&#147;non-recognized subsequent events&#148;). </p> 2019-05-01 we received funds from Crown Bridge Partners, LLC ('Crown Bridge') under a Securities Purchase Agreement 95000 5000 convertible promissory note 2019-04-18 100000 2000 0.1200 If we prepay the Note through the 180th day following the date thereof, we must pay all of the principal and interest with a prepayment penalty ranging from 135% to 150%. After the 180th day we have no further right of prepayment. 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CONDENSED STATEMENT OF CASH FLOWS (Unaudited) link:presentationLink link:definitionLink link:calculationLink 000320 - Disclosure - Note 10 - Subsequent Events: Subsequent Events, Policy (Policies) link:presentationLink link:definitionLink link:calculationLink 000290 - Disclosure - Note 2 - Summary of significant accounting policies: Reclassifications (Policies) link:presentationLink link:definitionLink link:calculationLink 000520 - Disclosure - Note 9 - Stockholders Equity (Details) link:presentationLink link:definitionLink link:calculationLink 000150 - Disclosure - Note 9 - Stockholders Equity link:presentationLink link:definitionLink link:calculationLink 000450 - Disclosure - Note 5 - Commitments and contingencies: Schedule of future minimum lease payments (Details) link:presentationLink link:definitionLink link:calculationLink 000350 - Disclosure - Note 2 - Summary of significant accounting policies: Revenue Recognition: Schedule of revenue by contract type (Tables) link:presentationLink link:definitionLink link:calculationLink 000130 - 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Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Grant Date Intrinsic Value Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price Debt Instrument, Payment Terms Debt Instrument, Name Debt Instrument [Axis] Net intangible assets Net intangible assets Cash and cash equivalents Loss on equity investment in unconsolidated subsidiary Loss on equity investment in unconsolidated subsidiary Consulting services Common Stock, Par or Stated Value Per Share Stockholders' deficit LIABILITIES Notes receivable, related party Cash {1} Cash Cash and Cash Equivalents, at Carrying Value, Beginning Balance Cash and Cash Equivalents, at Carrying Value, Ending Balance Period End date Debt Instrument, Issuance Date Long-term Debt Advances to Affiliate Accumulated amortization and depreciation Accumulated amortization and depreciation Schedule of Tenant Improvements and Office Equipment Subsequent Events, Policy Comprehensive Income (Loss) Note 7 - Related Party Proceeds from issuance of stock Accounts receivable Accounts receivable Common stock issued Common Stock, Shares, Issued Total assets Total assets Amendment Description Registrant CIK Subsequent Event, Description Subsequent Event, Date Adjustments to Additional Paid in Capital, Other Debt Instrument, Issuer To Related Party Represents the To Related Party, during the indicated time period. Operating Leases, Future Minimum Payments Receivable, Current Total Revenue Total Revenue Represents the monetary amount of Total Revenue, during the indicated time period. Schedule of assumptions used in fair value calculations Stock-Based Compensation Use of estimates Policies Supplemental cash flow disclosures: Proceeds from related party loans Proceeds from debt Basic and fully diluted weighted average number of shares outstanding Net income/(loss) Net income/(loss) Compensation Gross profit Gross profit Product sales Product sales Total liabilities and stockholders' deficit Total liabilities and stockholders' deficit Total current liabilities Total current liabilities Lease liability Entity Address, Address Line One Amendment Flag Fiscal Year End Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Beginning Balance Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Beginning Balance Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance Debt Instrument, Interest Rate, Stated Percentage Two private entities in Oklahoma Represents the Two private entities in Oklahoma, during the indicated time period. Operating Leases, Future Minimum Payments Receivable Operating Leases, Future Minimum Payments Receivable Cash paid for income taxes Cash paid for interest Net cash flows Net cash flows Accounts payable {1} Accounts payable Stock-based compensation Total liabilities Total liabilities Property and equipment, net Property and equipment, net Entity Incorporation, State or Country Code Document Transition Report Emerging Growth Company Subsequent Event Type Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price Richland Fund, LLC, (the 'lender') Represents the Richland Fund, LLC, (the 'lender'), during the indicated time period. Entity Incorporation, Date of Incorporation Tables/Schedules Prepaid expenses and other assets {2} Prepaid expenses and other assets Impairment on investment Rents and other occupancy Long-term loan from related party Loan to related party Loan to related party Accounts Receivable, net Entity Address, Postal Zip Code Entity Address, State or Province Shell Company Filer Category Stock compensation expense, unrecognized Represents the monetary amount of Stock compensation expense, unrecognized, during the indicated time period. Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Beginning Balance Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Beginning Balance Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price, Ending Balance