awaw_10q.htm

WHITE FOX VENTURES, INC.
(FORMERLY BREATHE ECIG CORP.)
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

	JUNE 30,			DECEMBER 31,
	2016			2015

ASSETS
CURRENT ASSETS
Cash	$	-		$	10,955
Prepaid expenses		8,333			52,051
Investment in Kudzoo, Inc.		50,000			-
Assets from discontinued operations		113,843			114,067
Total current assets		172,176			177,073

TOTAL ASSETS	$	172,176		$	177,073


LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
Accounts payable and accrued expenses	$	353,150		$	444,670
Notes payable - current portion		172,970			319,361
Accrued interest		2,552			17,162
Liability for stock to be issued		51,021			82,710
Notes payable - related parties		75,000			1,175,000
Liabilities of discontinued operations		250,443			232,771
Total current liabilities		905,136			2,271,674

TOTAL LIABILITIES		905,136			2,271,674

STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock, $0.001 par value, 10,000,000 shares authorized
Nil shares issued and outstanding		-			-
Common stock, $0.001 par value, 8,000,000,000 and 500,000,000 shares authorized, respectively
38,728,856 and 4,708,113 shares issued and outstanding, respectively		38,729			4,708
Additional paid in capital		8,970,568			7,339,096
Accumulated deficit		(9,742,257	)		(9,438,405	)
Total stockholders' equity (deficit)		(732,960	)		(2,094,601	)

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	$	172,176		$	177,073

F-1

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2016 AND 2015

(UNAUDITED)

	SIX MONTHS ENDED						THREE MONTHS ENDED
	JUNE 30,						JUNE 30,
	2016			2015			2016			2015

REVENUE	$	-		$	-		$	-			-

COST OF GOODS SOLD		-			-			-			-

GROSS LOSS		-			-			-			-

OPERATING EXPENSES
Professional fees		185,901			4,459,807			55,600			4,436,260
General and administrative		62,967			86,540			10,617			34,190
Total operating expenses		248,868			4,546,347			66,217			4,470,450

OTHER (INCOME) EXPENSE
Interest expense, net		21,891			177,674			860			174,813
Gain on conversion of debt		2,821			-			27,500			-
Fair value adjustment on derivative liability		-			60,193			-			26,803
Total other (income) expense		24,712			237,867			28,360			201,616

Net loss before provision for income taxes		(273,580	)		(4,784,214	)		(94,577	)		(4,672,066	)

Provision for income taxes		-			-						-

Net loss from continuing operations	$	(273,580	)	$	(4,784,214	)	$	(94,577	)	$	(4,672,066	)

Loss from discontinued operations	$	(30,272	)	$	(1,891,566	)	$	(6,561	)	$	(1,003,410	)

Net Loss	$	(303,852	)	$	(6,675,780	)	$	(101,138	)	$	(5,675,476	)

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING		12,930,465			2,752,157			25,024,651			3,156,071

NET LOSS PER SHARE	$	(0.02	)		(1.74	)	$	(0.00	)		(1.48	)

F-2


	SIX MONTHS ENDED
	JUNE 30
	2016			2015
				(RESTATED)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(303,852	)	$	(6,675,780	)

Adjustments to reconcile net (loss) to net cash (used in) operating activities:
Depreciation and amortization		-			12,449
Amortization of deferred financing fees		-			6,358
Non-cash interest charges		2,062
Amortization of original issue discount		19,829			6,958
Legal fees incurred deducted from proceeds of notes payable		-			24,250
Gain on extinguishment of debt		2,821
Fair value adjustment in derivative liabilities		-			60,193
Common stock/stock options issued or to be issued for services rendered		-			5,891,495

Change in assets and liabilities
(Increase) decrease in prepaid expenses and deposits		43,718			(865,528	)
Decrease in inventory		224			(120,072	)
Decrease in accounts payable and accrued expenses		(155,841	)		262,226
Net cash (used in) operating activities		(391,039	)		(1,397,451	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of fixed assets		-			-
Purchase of Investment in Kudzoo, Inc.		(50,000	)		-
Acquisition of mining rights		-			-
Net cash (used in) investing activities		(50,000	)		-

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds received from convertible notes		-			770,250
Repayments of notes payable		-			(32,500	)
Proceeds from promisory notes - related party		47,500			-
Cash paid to purchase price adjustments and derivate rights on stock					-
Proceeds received for common stock and liability for stock to be issued		382,584			708,770
Net cash provided by financing activities		430,084			1,446,520

NET (DECREASE) IN CASH		(10,955	)		49,069

CASH - BEGINNING OF YEAR		10,955			13,346

CASH - END OF YEAR	$	-		$	62,415

SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	-		$	20,308
Income taxes		-			-

SUPPLEMENTAL NON-CASH ACTIVITY:
Reverse Merger of Breathe LLC - discontinued operations
Accumulated deficit	$	-		$	7,733,077
Prepaid expenses		-			191,584
Fixed assets		-			138,049
Mining rights		-			1,035,818
Accounts payable					(111,275	)
Asset retirement obligation		-
Note payable		-
Accumulated comprehensive income
Due to Company		-
Adjustment to APIC	$	-		$	9,089,658

Shares received in TAUG for commercialization of product at fair value	$	-		$	100,000
Common shares issued for investment in Tauriga	$	-		$	100,000
Original issue discount netted from convertible notes	$	-		$	58,000
Inventory purchased through issuance of common stock	$	-		$	22,500
Common shares issued for conversion of debt	$	146,220		$	406,385
Common shares issued and to be issued for conversion of related party notes payable	$	1,105,000		$	22,500
Total Non-Cash Activities		1,251,220			18,786,296

F-3

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 1 -

ORGANIZATION AND BASIS OF PRESENTATION

The unaudited financial statements included herein have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial statements and notes are presented as permitted on Form 10-Q and do not contain certain information included in the Company’s annual statements and notes. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these financial statements be read in conjunction with the December 31, 2015 Form 10-K filed with the SEC, including the audited financial statements and the accompanying notes thereto. While management believes the procedures followed in preparing these financial statements are reasonable, the accuracy of the amounts are in some respects dependent upon the facts that will exist, and procedures that will be accomplished by the Company later in the year.

These unaudited financial statements reflect all adjustments, including normal recurring adjustments which, in the opinion of management, are necessary to present fairly the operations and cash flows for the periods presented.

On June 2, 2006, Celtic Capital, Inc. was incorporated in the State of Nevada. On October 20, 2008, Celtic Capital, Inc. changed its name to Entertainment Educational Arts Inc. On May 12, 2010, the Company changed its name to DNA Precious Metals, Inc. (the “Company”). On October 29, 2010, the Company formed DNA Canada Inc., a Canadian (Province of Quebec) incorporated company, as a wholly-owned subsidiary. The Company operated all of its exploration operations through this Canadian entity.

The Company acquired certain mining claims on June 9, 2011 located in the Montauban and Chavigny townships near Grondines-West in the Portneuf County of Quebec, Canada (“Montauban Mine Property” or “Property”).

On October 30, 2013 and November 27, 2013, the Company entered into binding agreements for the asset acquisitions of an undivided one hundred percent (100%) interest in certain mineral claims and mining assets located in the Province of Quebec’s Montauban and Chavigny townships near Grondines West, in the county of Portneuf, specifically Mining Lease BM 748 and Mining Concession Miniere CM 410. The purchase price was CDN$75,000 together with the issuance of 10,500 common shares of the Company. The common shares for the acquisition were valued at their fair market value on the day they were issued which totaled $496,860. In connection with the asset purchase, the Company also issued 400 shares of common stock to a former supplier of the vendor for mining related information of the assets purchased valued at $20,000 along with cash consideration of CDN$20,000. The Company had been awaiting confirmation of the contemplated transaction from a bankruptcy court in Montreal, Quebec overviewing the financial restructuring of the vendor. The bankruptcy court approved the transaction on April 17, 2014.

On January 10, 2014, the Company entered into an asset purchase agreement for an undivided one hundred percent (100%) interest in certain mineral claims located in the Province of Quebec’s Montauban and Chavigny townships near Grondines West, in the county of Portneuf, including claims, rights, concessions and leases. The purchase price was CDN$70,000, 10,000 common shares of the Company and a one percent (1%) net smelter return (“NSR”). The Company paid CDN$10,000 upon the signing of the asset purchase agreement with the cash balance due, along with the common shares, upon the closing of the asset purchase agreement and transfer of the mineral claims in the name of the Company. The transfer of the mineral claims was completed in February 2014 whereby the remaining cash balance due and the common shares were released to the vendor.

F-4

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 1-

ORGANIZATION AND BASIS OF PRESENTATION (CONTINUED)

The common shares for the acquisition were valued at their fair market value on the day they were issued which totaled $340,000. The total cost of the acquisition amounted to $403,840.

On April 14, 2014, the Company entered into an asset purchase agreement for an undivided one hundred percent (100%) interest in fifty-seven (57) mining claims located in the Province of Quebec’s Montauban and Chavigny townships near Grondines West, in the county of Portneuf. The purchase price was CDN$5,000 (US $4,547). The transfer of the mining claims has been completed by the Province of Quebec in the name of the Company.

On December 4, 2014, the Company presented a renewal request with the Government of the Province of Quebec to renew all 122 claims and this has been granted through a decision dated February 23, 2015.

On January 16, 2015, Breathe eCigs Corp., a Tennessee corporation (“Breathe”), entered into a Share Exchange Agreement (the “Exchange Agreement”) with the Company, whereby the Company acquired all of the issued and outstanding membership interests Breathe LLC in consideration for the issuance of 1,500,000 shares of the Company’s common stock to the members of Breathe LLC.

As a result of the transaction effected by the Exchange Agreement, at closing Breathe became a wholly owned subsidiary of the Company, with the former Breathe shareholders owning approximately 56% of the then issued and outstanding common stock of the Company. The Company accounted for this acquisition as a reverse merger, whereby Breathe became the accounting acquirer. As a result, the comparative figures are those of Breathe.

In connection with the acquisition of Breathe LLC, on March 5, 2015 the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which the Company merged with its wholly owned subsidiary, Breathe eCig Corp., the sole purpose of the Merger was to effect a change of the Company's name from DNA Precious Metals, Inc. to Breathe eCig Corp. This name change more accurately reflects the Company’s current operations.

With the acquisition of Breathe LLC, it was contemplated that the Company would spin-off the operations of its mining operations, which were being conducted through the Company’s wholly owned subsidiary, DNA Canada, Inc. (“DNAC”). Effective February 3, 2015, the Company declared a stock dividend whereby each of the Company’s shareholders on the record date (February 3, 2015) would receive one share of DNAC for every two shares of the Company’s common stock owned.

On February 3, 2015, the Company declared a stock dividend of its wholly owned subsidiary, DNA Canada, Inc. (“DNAC”) to the shareholders of record on February 3, 2015 whereby each shareholder of record received one share of DNAC for every two shares of DNA owned as of the record date. The former members of Breathe LLC tendered their shares of DNAC for redemption by the Company.

With the completion of the spin-off, the Company was no longer in the mining field and its sole and exclusive business operations was the marketing of its electronic cigarettes and related vapor devices.

The Company in March 2015 entered into Distribution Agreements with various distributors for the distribution of the Company’s products.

On May 11, 2015 the Company formed two wholly owned subsidiaries to conduct non-eCigarette related business by way of holding medical device and other related intellectual property for the future development of for-profit activates and/or partnerships. Currently these entities are inactive, and neither holds any assets, carry any liabilities nor hold any intellectual property.

F-5

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 1-

ORGANIZATION AND BASIS OF PRESENTATION (CONTINUED)

On March 15, 2016, the Company had their DEF 14A approved by the SEC. As a result of this, the authorized common stock increased from 500,000,000 to 8,000,000,000 shares. The common share increase was approved by the Company’s board of Directors on February 1, 2016. In lieu of calling a special meeting of our stockholders, our Board of Directors had elected to obtain stockholder approval of the Authorized Share Increase Amendment by written consent (“Written Consent”) pursuant to Article II, Section 12 of our Bylaws and Section 78.370 of the Nevada Revised Statues. The close of business on February 18, 2016 was fixed as the record date for the determination of holders of our Common Stock entitled to receive notice of and discretion to approve the Authorized Share Increase Amendment.

On January 25, 2016, Mr. Seth M. Shaw succeeded Mr. Joshua Kimmel as Chief Executive Officer of the Company. Mr. Kimmel resigned as a director and officer of the Company at that time. On April 5, 2016, Mr. Shinsuke Nakano was appointed CEO of the Company. Simultaneously, Mr. Shaw was appointed Interim Chief Financial Officer and Director.

As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company is required to pay two cash payments ($10,000 was paid on March 31, 2016 and $15,000 was originally due by July 31, 2016 and was paid on August 10, 2016.) Under this agreement, the Company also is required to issue 50 million restricted common shares of Company stock (which was issued April 15, 2016) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory. As of March 30, 2016, the Company re-entered the development stage.

On April 5, 2016, the Company announced its intention to give White Fox Ventures Inc. a majority controlling interest in the Company pursuant to an Acquisition Agreement by which White Fox Ventures Inc. was to be acquired for an undetermined number of shares equating 85% of the total authorized capital of the Company. The deal was to be effective April 15, 2016. On May 5, 2016, the Company announced that the deal will be rescinded based on the due diligence on this acquisition. It was determined that the agreement and acquisition were not in the best interests of the Company at this time. The principal of White Fox Ventures Inc., Shinsuke Nakano (“Nakano”), and investors had invested $196,557 into the Company in the form of payment of various settlements and invoices outstanding. The investment was treated as private placement at $0.0001, whereby the Company, on May 10, 2016, issued to Nakano and investors 19,655,700 shares of common stock. In addition, for their investments Nakano was named as the Chief Executive Officer of the Company and the Chairman of the Board and Mr. Abe was appointed to the positions of Chief Operating Officer ("COO") and Director ("Board Member".) An additional $65,000 was invested in May 2016 and an additional 6,500,000 shares are owed for this investment.

On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the company to White Fox Ventures, Inc. (“White Fox”) to better reflect the new direction of the business and to affect a 100:1 reverse stock split. On May 27, 2016, the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol.

On June 17, 2016, the Company formed a subsidiary with 99% majority ownership stake. The subsidiary, White Fox Japan LLC, will be presented with a non-controlling interest of 1% for the share owned by related party, Company Chief Operating Officer and Director, Takehiro Abe. The subsidiary will conduct all transactional operational activity of the Company. The subsidiary will plan, manage and promote seminars and classes in Japan. The subsidiary has a fiscal year ended April 30, 2017. As of June 30, 2016 there was no activity in the subsidiary.

On June 22, 2016, FINRA announced its final approval for the Company’s change of name to White Fox Ventures, Inc., as well as a 1:100 Reverse Stock Split and the Company’s new Ticker symbol, AWAW, which began trading on July 20, 2016. All share figures are shown in this report are on a post reverse split basis.

The Company, through its subsidiary, White Fox Japan LLC will conduct all transactional operational activity of the Company. The subsidiary will plan, manage and promote seminars and classes in Japan.

F-6

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 1-

ORGANIZATION AND BASIS OF PRESENTATION (CONTINUED)

Going Concern

The Company’s continuation as a going concern is dependent upon, amongst other things, continued financial support from its shareholders, attaining a satisfactory revenue level, attainment of profitable operations and the generation of cash from operations and the ability to secure new financing arrangements and new capital to carry out its business plan. These matters are dependent on a number of items outside of the Company’s control and there exists material uncertainties that may cast significant doubt about the Company’s ability to continue as a going concern.

On March 30, 2016, the Company discontinued the operations of its eCigarette business as a result of the settlement agreement they entered into with Breathe LLC. The agreement was the result of the difficulties of past management to operate that business effectively and profitably. With the departure of the past CEO, Joshua Kimmel, the Company was able to convert over $1,050,000 in debt in exchange for the intellectual property the Company owned in this industry, and agreed to exit this industry and sell off all remaining inventory during the next fiscal year.

On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the Company to White Fox Ventures, Inc. (“White Fox”) to better reflect the new direction of the business and to affect a 100:1 reverse stock split. On May 27, 2016 the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol.

The Company can give no assurance that it will achieve profitability in its new business or be capable of sustaining profitable continuing operations. These consolidated financial statements do not include any adjustments relating to the recoverability and classification of the carrying amounts of assets or the amount and classification of liabilities that might result if the Company is unable to continue as a going concern. These factors raise substantial doubt regarding the ability of the Company to continue as a going concern.

The Company raised $382,584 for the six months ended June 30, 2016, through the sale of common stock and was able to raise capital in the form of a note from a related party in the amount of $47,500. The Company also converted $146,220 of promissory notes into shares of common stock.

Basis of Accounting

These consolidated financial statements are prepared in conformity with United States generally accepted accounting principles (“U.S. GAAP”) and are presented in U.S. dollars.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates include but are not limited to stock-based compensation and tax valuation allowances.

F-7

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 2-

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The condensed consolidated financial statements included the accounts of the Company and Breathe as the acquisition of Breathe was accounted for as a reverse merger and Breathe is the accounting acquirer, from the date that the Merger occurred between the Company and Breathe eCigs Corp. All intercompany transactions and accounts had been eliminated on consolidation. Effective March 11, 2015, the financial statements were no longer consolidated until April 2015 and the establishment of two new wholly-owned subsidiaries, which are inactive.

Business Combination

On January 16, 2015, Breathe entered the Exchange Agreement with the Company, whereby the Company acquired all of the issued and outstanding shares of common stock of Breathe in consideration for the issuance of 1,500,000 shares of common stock. This business combination was accounted for as a reverse merger whereby Breathe is the accounting acquirer as the former Breathe shareholders then controlled greater than 50% of the voting control of the Company.

In November 2014, the FASB issued ASU No. 2014-17, “Business Combination.” The provisions of ASU No. 2014-17 require management to determining whether and at what threshold an acquiree (acquired entity) can reflect the acquirer’s accounting and reporting basis (pushdown accounting) in its separate financial statements. The entities of the transaction were under common control from January 16, 2015 until February 3, 2015. Since neither unit of this business combination is in the development stage, nor had recognizable revenues during this period the application of push down accounting would not be of significant value to the readers of these condensed consolidated financial statements. The Company has not elected to apply pushdown accounting in its separate financial statements upon occurrence of this event.

Stock Based Compensation

The Company estimates the fair value of stock based payment awards made to officers and directors related to the Company’s stock incentive plan, on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense ratably over the requisite service periods. The Company uses the Black-Scholes option pricing model to determine the fair value of the stock-based compensation that it grants to officers and directors. The Company is required to make certain assumptions in connection with this determination, the most important of which involves the calculation of volatility with respect to the price of its common stock. The computation of volatility is intended to produce a volatility value that is representative of the Company’s expectations about the future volatility of the price of its common stock over an expected term. Shares of the Company commenced trading on August 22, 2013. As a result, the volatility value that the Company calculated may differ from the future volatility of the price of its shares of common stock.

Upon the exercise of stock options, any consideration received and the amounts previously recorded under stock-based compensation are credited to share capital. Upon the issuance of shares resulting from share awards, amounts previously recorded under stock based compensation are credited to share capital.

Comprehensive Income (Loss)

The Company adopted ASC 220-10, “Reporting Comprehensive Income,” (formerly SFAS No. 130). ASC 220-10 requires the reporting of comprehensive income in addition to net income from operations.

Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of information that historically has not been recognized in the calculation of net income.

F-8

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 2-

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Cash and Cash Equivalents

The Company considers all highly liquid debt instruments and other short-term investments with maturity of three months or less, when purchased, to be cash equivalents.

At June 30, 2016 the Company did not maintain cash or cash equivalent balances at any major United States bank.

Income Taxes

The Company uses the liability method of accounting for income taxes under which deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as part of the provision for income taxes in the period that includes the enactment date. Deferred tax liabilities are always provided for in full. Deferred tax assets are recognized to the extent that it is probable that they will be able to be utilized against future taxable income. Deferred tax assets and liabilities are offset only when the Company has a right and intention to set off current tax assets and liabilities from the same taxation authority. Valuation allowances are established, when necessary, to reduce deferred tax assets to amounts that are expected to be realized.

The Company accounts for income taxes pursuant to the provision of ASC 740-10, “Accounting for Income Taxes” (“ASC 740-10”) which requires, among other things, an asset and liability approach to calculating deferred income taxes. The asset and liability approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. A valuation allowance is provided to offset any net deferred tax assets for which management believes it is more likely than not that the net deferred asset will not be realized.

The Company follows the provision of ASC 740-10 related to Accounting for Uncertain Income Tax Position. When tax returns are filed, there may be uncertainty about the merits of positions taken or the amount of the position that would be ultimately sustained.

In accordance with the guidance of ASC 740-10, the benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions.

Tax positions that meet the more likely than not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above should be reflected as a liability for uncertain tax benefits in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. The Company believes its tax positions are all highly certain of being upheld upon examination. As such, the Company has not recorded a liability for uncertain tax benefits.

The Company has adopted ASC 740-10-25, “Definition of Settlement”, which provides guidance on how an entity should determine whether a tax position is effectively settled for the purposes of recognizing previously unrecognized tax benefits and provides that a tax position can be effectively settled upon the completion and examination by a taxing authority without being legally extinguished. For tax positions considered effectively settled, an entity would recognize the full amount of tax benefit, even if the tax position is not considered more likely than not to be sustained based solely on the basis of its technical merits and the statute of limitations remains open. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities generally for three years after they were filed.

F-9

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 2-

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Revenue Recognition

The Company recognizes revenues from the sale of the Company’s products when the following criteria are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the price to the customer is fixed or determinable; and (iv) collection of the sales price is reasonably assured. Delivery occurs when goods are shipped and title and risk of loss have passed to the customer. Revenue is deferred in all instances where the earnings process is incomplete. Payments received before all of the relevant criteria for revenue recognition are satisfied will be recorded as deferred revenue. Revenues and costs of revenues from consulting contracts will be recognized during the period in which the service will be performed. All revenues will be reported net of any sales discounts or taxes. Any revenues generated are included in discontinued operations.

Trade Receivables and Allowance for Doubtful Accounts

The Company was engaged up until March 30, 2016 in the sales and distribution in the consumer products market through sales to distributors, wholesalers and direct to consumers via e-commerce sales of eCigarettes for use by consumers. Trade receivables consisted primarily of amounts due to the Company from their normal business activities whereby approved distributors and wholesalers are extended terms after down payments on orders. The Company controlled credit risk related to the trade receivables through credit approvals, credit limits and monitoring procedures, and perform ongoing credit evaluations of the customers. In assessing the carrying value of its trade receivables, the Company estimated the recoverability by making assumptions based on factors such as current overall and industry-specific economic conditions, historical and anticipated customer performance, historical write-off and collection experience, the level of past-due amounts, and specific risks identified in the accounts receivable portfolio. Additional changes to the allowance could be necessary in the future if a customer’s creditworthiness deteriorates, or if actual defaults are higher than the Company’s historical experience. Any difference could result in an increase or decrease in the allowance for doubtful accounts. All accounts receivable, net of an allowance are considered assets from discontinued operations.

Inventory

Finished Goods Inventory - Finished goods inventory is stated at the lower of cost or market determined by the first-in, first-out method, and include salable eCigarette product items and supplies that are sale ready to ship to consumers, wholesalers or distributers. Shipping and handling costs (consisting of all costs to warehouse, pick, pack and deliver inventory to customers) will be included in cost of goods sold. Samples are included in marketing expenses which are a component of general and administrative costs. The Company in March 2015 entered into Distribution Agreements with various distributors for the distribution of the Company’s products. The Company placed an initial order for merchandise in the amount of $437,750 on March 27, 2015. The Company has outsourced the assembly and production of its products held for resale and will not hold any of the product in its possession. The Company’s inventory is received, housed and distributed by a third party fulfillment provider. As of June 30, 2016, the inventory held by the third party fulfillment provider had a value of $227,685.

As of March 30, 2016, pursuant to a settlement agreement under trademark litigation, the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company is required to pay two cash payments ($10,000 was paid on March 31, 2016 and $15,000 originally due by July 31, 2016 and was paid on August 10, 2016.) Under this agreement, the Company is required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.

As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

As a result of the settlement agreement and the resultant discontinuance of this operation, management feels that it could sell the current inventory at $.50 for each $1 of inventory therefore an allowance has been recorded to recognize the current expected net realizable value of the on-hand inventory in the amount of $113,843. This amount is reflected in assets from discontinued operations.

F-10

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 2-

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Loss Per Share of Common Stock

Basic net loss per share (“Basic EPS”) is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding for the period.

Diluted earnings per share is computed by dividing adjusted net income available to common shareholders by the weighted average number of common shares outstanding adjusted for the effects of all dilutive common share issuances.

Dilutive common share issuances shall be deemed to have been converted into ordinary shares at the beginning of the period.

For the purpose of calculating diluted earnings per share, the Company shall assume the exercise of dilutive stock options and warrants, as well as shares reserved for the conversion of certain notes payable. The assumed proceeds from these instruments shall be regarded as having been received from the issue of common shares at the average market price of common shares during the period. Dilutive common share issuances are not included in the computation of diluted earnings per share when the Company reports a loss because to do so would be anti-dilutive for the periods presented.

Derivative Financial Instruments

The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.

The accounting treatment of derivative financial instruments may require that the Company for various instruments record the conversion option and related warrants at their fair values as of the inception date of the agreements, and at fair value as of each subsequent balance sheet date, should the characteristics of these instruments warrant the need to record the derivative liability.

During the year ended December 31, 2014, as a result of entering into the convertible notes, the Company was required to classify certain non-employee warrants as derivative liabilities and record them at their fair values at each balance sheet date. Any change in fair value was recorded as a change in the fair value of derivative liabilities for each reporting period at each balance sheet date. The Company reassessed the classification at each balance sheet date. If the classification changed as a result of events during the period, the contract was reclassified as of the date of the event that caused the reclassification.

The fair value of conversion options at a fixed number of shares are recorded using the intrinsic value method. Conversion options at variable rates and any options and warrants with ratchet provisions are deemed to contain a “down-round protection”. Accordingly, they do not meet the scope exception for treatment as a derivative under ASC 815 since “down-round protection” is not an input into the calculation of the fair value of the equity instruments and cannot be considered “indexed to the Company’s own stock”, which is a for the scope exception as outlined under ASC 815.

F-11

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 2-

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Derivative Financial Instruments (Continued)

The Company signed convertible notes and warrants and has determined that a conversion option is embedded in the note and it is required to bifurcate the conversion option from the host contract under ASC 815 and account for the derivatives at fair value. The estimated fair value of the conversion option was determined using the binomial model. The fair value of the conversion option was classified as a liability until the debt was converted by the note holders or paid back by the Company. The fair value was affected by changes in inputs to that model including the stock price, expected stock price volatility, the contractual term, and the risk-free interest rate. The Company continued to classify the fair value of the conversion option as a liability until the conversion option was exercised, expired or amended in a way that would no longer require these conversion options to be classified as a liability, whichever comes first. The Company has adopted a sequencing policy that reclassifies contracts (from equity to assets or liabilities) with the most recent inception date first. Thus any available shares are allocated first to contracts with the most recent inception date.

For the binomial lattice options pricing model, the Company used the following assumptions and weighted average fair value ranges as at the transaction date, April 28, 2014, and for the period ended June 30, 2016:

Convertible Notes:	April 28, 2014		June 30, 2016
Risk free interest rate		0.0577%		N/A
Dividend yield		N/A		N/A
Volatility		86.31%		N/A

Warrants:	April 28, 2014		June 30, 2016
Risk free interest rate		0.144%		N/A
Dividend yield		N/A		N/A
Volatility		97.33%		N/A

The Company had repaid the debt associated with the derivative liability in December 2014, however carried the warrants through the conversion of those warrants in September 2015. As a result of the conversion of the warrants, the entire derivative liability was extinguished as of September 30, 2015. The Company has no other instruments that contain embedded derivatives.

Prior to the effective date of the DEF 14A (March 15, 2016) which included the amendment to the Certificate of Incorporation increasing the authorized common shares of the Company from 500,000,000 to 8,000,000,000 shares, the Company did not have sufficient authorized shares to effectuate any conversion of convertible notes outstanding with either of the two noteholders. The Company remained in constant negotiations with the noteholders resulting in amended agreements dated March 25, 2016 and March 29, 2016, respectively, and the noteholders did not exercise their right to issue the Company a notice of default. At no time, did the Company consider that the notes outstanding could not be fully settled, with the DEF 14A progressing towards effectiveness. As the 14A was effective, prior to the issuance of this report, the Company in effect, cured any default under the note agreements, and as a result, no derivative liability was recorded by the Company. The amended note agreements reflect the current number of common shares needed to settle the remaining convertible note agreements and there are sufficient shares available to settle these agreements.

Reclassifications

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

Restated Financial Statements

Prior year amounts are presented in accordance with Amendment No. 1 on Form 10 Q/A for the quarters ended March 31, 2015 and June 30, 2015 as filed with the Securities and Exchange Commission on November 10, 2015. The required adjustments were made to correct the error to properly account for its accounting for the acquisition of Breathe eCigs Corp. (formerly Breathe LLC) on January 16, 2015 as a reverse merger for accounting purposes.

F-12

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 2-

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Recent Issued Accounting Standards

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

In February 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2015-02 (ASU 2015-02) "Consolidation (Topic 810): Amendments to the Consolidation Analysis." ASU 2015-02 changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. It is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. We are currently in the process of evaluating the impact of the adoption of ASU 2015-02 on our consolidated financial statements.

In November 2014, the FASB issued ASU No. 2014-17, “Business Combination.” The provisions of ASU No. 2014-17 require management to determining whether and at what threshold an acquiree (acquired entity) can reflect the acquirer’s accounting and reporting basis (pushdown accounting) in its separate financial statements. Since neither unit of this business combination is in the development stage, nor had recognizable revenues during this period the application of push down accounting would not be of significant value to the readers of these condensed consolidated financial statements. The Company has not elected to apply pushdown accounting in its separate financial statements upon occurrence of this event.

During August 2014, the FASB issued ASU No. 2014-15, “Presentation of Financial Statements—Going Concern.” The provisions of ASU No. 2014-15 require management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this ASU are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company is currently assessing the impact of this ASU on the Company’s consolidated financial statements.

During June 2014, the FASB issued an Accounting Standards Update No. 2014-10, "Development Stage Entities (Topic 915) - Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation ("ASU 2014-10")". The objective of ASU 2014-10 is to improve financial reporting by reducing the cost and complexity associated with the incremental reporting requirements for development stage entities. ASU 2014-10 is effective for annual reporting periods beginning after December 15, 2014, and interim periods therein. The Company has elected early implementation, as permitted by the standard, for the interim period ending June 30, 2014. All exploration stage language disclosures and amounts have been removed as a result of the adoption of ASU 2014-10.

F-13

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 2-

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Recent Issued Accounting Standards (Continued)

The changes permit businesses and other organizations to first use subjective criteria to determine if an intangible asset has lost value. The amendments to U.S. GAAP will be effective for fiscal years starting after September 15, 2012. The Company’s adoption of this accounting guidance does not have a material impact on the consolidated financial statements and related disclosures.

There were other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

NOTE 3-

ACQUISITION

Breathe eCigs Corp. Acquisition and Spin-off of DNA Canada, Inc.

On January 16, 2015, Breathe eCigs Corp., a Tennessee corporation (“Breathe”), entered into a Share Exchange Agreement (the “Exchange Agreement”) with the Company, whereby the Company acquired all of the issued and outstanding shares of common stock of Breathe in consideration for the issuance of 1,500,000 shares of common stock.

The Company declared a stock dividend to its shareholders of record as of February 3, 2015 of its wholly owned subsidiary, DNA Canada, Inc. Each shareholder of record on this date will receive one share of DNA Canada, Inc. for every two shares of DNA Precious Metals Inc. owned by the shareholder on this date. All stock dividends will be rounded down to the next whole number. With the completion of the stock dividend, the Company, no longer has an equity interest in DNA Canada, Inc.

The former shareholders of Breathe participating in the stock dividend were required to tender for redemption any shares of DNA Canada, Inc. common stock received pursuant to the stock dividend in accordance with the Exchange Agreement.

With the acquisition of Breathe, management determined that it would be in the best interest of the Company and its shareholders to operate each company separate and independently of each other. The operation of DNA Canada, Inc. and Breathe were inconsistent. Breathe is a manufacturer and distributor of e-cigarette and related products while DNA Canada, Inc. is an exploration stage mining company. The spin-off of DNA Canada, Inc. will allow each company to focus on its principal business activity and facilitate capital formation.

On March 5, 2015, the Company and Breathe entered into an Agreement and Plan of Merger pursuant to which the Company merged with its wholly owned subsidiary, Breathe. Upon the consummation of the Merger on March 11, 2015, the separate existence of Breathe ceased, and the shareholders of the Company became shareholders of the surviving company, named Breathe eCig Corp. As permitted under Nevada law, the sole purpose of the Merger was to affect a change to the Company’s name from DNA Precious Metals, Inc. to Breathe eCig Corp. This change to the Amended Articles of Incorporation and name change took effect on March 11, 2015.

F-14

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 4-

DISCONTINUED OPERATIONS

Trademark Settlement/Disposal of eCigarette Operations

As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company is required to pay two cash payments ($10,000 paid March 31, 2016 and $15,000 originally due by July 31, 2016 and was paid on August 10, 2016.) Under the agreement, the Company also is required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016 at a value of $50,000) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. (at a value of $0 as this had been written off). The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.

As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

As a result of the disposal of the business and the discontinuance of the eCigarette operations, the following chart reflects the results of the condensed consolidated financial statements as loss from discontinued operations as of June 30, 2016:

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

CONSOLIDATED STATEMENTS OF DISCOUNTED OPERATIONS

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2016 AND 2015

(UNAUDITED)

	SIX MONTHS ENDED						THREE MONTHS ENDED
	JUNE 30,						JUNE 30,
	2016			2015			2016			2015
REVENUE	$	19		$	6,000		$	-		$	6,000

COST OF GOODS SOLD		1,851			7,057			-			7,057

GROSS LOSS		(1,832	)		(1,057	)		-			(1,057	)

OPERATING EXPENSES
Research and development		-			2,178			-			1,648
Marketing, advertising and promotion		9,000			438,233			3,000			424,458
Rent		7,122			1,187			3,561			1,187
Salaries and related expenses, including stock-based compensation		10,911			114,150			-			97,649
Professional fees		-			1,155,236			-			323,712
Depreciation and amortization		-			12,449			-			9,195
General and administrative		1,631			167,076			-			144,504
Total operating expenses		28,664			1,890,509			6,561			1,002,353

OTHER (INCOME) EXPENSE
Loss from Inventory valuation LCM		(224	)		-			-			-
Total other (income) expense		(224	)		-			-			-

Net loss before provision for income taxes		(30,272	)		(1,891,566	)		(6,561	)		(1,003,410	)

Provision for income taxes		-			-						-

Net loss	$	(30,272	)	$	(1,891,566	)	$	(6,561	)	$	(1,003,410	)

F-15

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 4-

DISCONTINUED OPERATIONS (CONTINUED)

Trademark Settlement/Disposal of eCigarette Operations (Continued)

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

BALANCE SHEET FROM DISCONTINUED OPERATIONS

	June 30, 2016		December 31, 2015
Assets of discontinued operations	$	113,843		114,067

Liabilities of discontinued operations	$	250,443		232,771

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES

The following summary of convertible notes payable and the related derivative liabilities associated with the convertible notes payable. As a result of the reverse merger, Breathe assumed responsibility of these DNA Precious Metals, Inc. notes, and any related derivative liability that exists under these notes related to the warrant agreements. Therefore, a full discussion has been provided for clarification.

F-16

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

On August 6, 2014, the Company entered into an agreement with a U.S.-based private equity fund (“Investor”) under which the Company issued an unsecured Convertible Note (“Convertible Note”) in the principal amount of $250,000. The funds to be issued under the Convertible Note is $225,000 (“Consideration”). The Convertible Note includes an original issue discount of $25,000 (“OID”), calculated at 10% of the principal amount ($250,000). The initial Consideration paid to the Company on August 6, 2014 was $66,000. The Investor was able to pay additional Consideration to the Company in such amounts and at such dates as the Investor may choose in its sole discretion. The principal sum due to the Investor was prorated based on the Consideration actually paid by the Investor plus a 10% OID, as well as any other interest or fees, such that the Company is only required to repay the amounts funded and the Company is not required to repay any unfunded portions of the Convertible Note. The Company was able to repay the Convertible Note at any time on or before 90 days from the transaction date after which the Company was not permitted to make further payments on the Convertible Note prior to the Maturity Date without written approval from the Investor. If the Company made a payment of Consideration on or before 90 days from the transaction date, the interest rate on that payment of Consideration was to be at zero percent (0%). If the Company did not repay a payment of Consideration on or before 90 days from the transaction date, a one-time interest was to be a charge of 12% shall be applied to the principal amount. Any interest payable is in addition to the OID and that OID (or prorated OID, if applicable) remained payable regardless of time and manner of payment by the Company. The maturity date was two years from the transaction date of each payment ("Maturity Date") and was the date upon which the principal amount of the Convertible Note, as well as any unpaid interest and other fees, were due and payable. The Investor had the right, at any time after the transaction date, at its election, to convert all or part of the outstanding and unpaid principal amount and accrued interest (and any other fees) into fully paid and non-assessable shares of common stock of the Company.

The conversion price was the lesser of $1.60 or 60% of the lowest trade price in the 25 trading days prior to the conversion. Unless otherwise agreed in writing by both parties, at no time was the Investor convert any amount of the Convertible Note into common stock that would result in the Investor owning more than 4.99% of the common stock outstanding of the Company. At the time that this Convertible Note is outstanding, the Company agreed to reserve at least 100,000 shares of common stock for conversion. On October 30, 2014, the Company and the Investor entered into an amendment (“Amendment #1”), whereby the Company paid a partial note repayment in the amount of $33,333 on November 5, 2014 which equaled 50% of the note balance which includes $3,333 in interest, with the remaining balance due by January 6, 2015, which was repaid on December 29, 2014.

On April 28, 2014, the Company entered into a Securities Purchase Agreement (“SPA”), with a U.S.-based private equity fund, under which the Company issued a Secured Convertible Promissory Note (the “Convertible Note”) in the amount of $552,500. The Convertible Note included an original issue discount of $50,000 (“OID”), calculated at 10% of the principal amount ($500,000), plus an additional $2,500 (“Transaction Expense Amount”) to cover the investor’s due diligence and legal fees in connection therewith. The principal amount was to be paid to the investor in six (6) tranches of an initial amount under the Convertible Note of $250,000 and five (5) additional amounts of $50,000, with each of the additional amounts represented by Investor Notes (the Convertible Note and the Investor Notes are collectively referred to herein as the “Notes”). The initial $250,000 in cash was paid to the Company on April 29, 2014. Payment of the Notes were to be made on a monthly basis, beginning six months after the issue date when the Company received the initial $250,000, in the amount of $34,531 per month plus all accrued but unpaid interest and other costs, fees or charges payable, for sixteen (16) months until the balance is paid in full. The Notes were convertible into common stock, at the option of the investor, at a price of $0.40 per share subject to adjustment in the case of a default, reorganization or recapitalization. In the event the Company elected to prepay all or any portion of the Notes, the Company was required to pay to the investor an amount in cash equal to 125% of the outstanding balance of the Notes, plus accrued interest and any other amounts owing. Interest accrued at the rate of 10% per annum. If the Company failed to repay the Notes when due, or if other events of default thereunder apply, a default interest rate of 22% per annum would apply. In addition, if the Company failed to issue stock to the investor within three trading days of receipt of a notice of conversion, the Company must pay a penalty equal to the greater of greater of $500 per day and 2% of the applicable conversion amount or installment amount, as applicable (but, in any event, the cumulative amount of such late fees shall not exceed the applicable conversion amount or installment amount). The Notes were secured by an interest in all right, title, interest, claims and demands of the Company in and to the property described in the Security Agreement, and all replacements, proceeds, products, and accessions thereof.

F-17

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

The Notes were convertible into shares of our common stock in six tranches, consisting of (i) an initial tranche in an amount equal to $277,500 and any interest, costs, fees or charges accrued thereon or added thereto under the terms of this Note and the other Transaction Documents (as defined in the Securities Purchase Agreement), and (ii) five (5) additional tranches, each in the amount of $55,000, plus any interest, costs, fees or charges accrued thereon or added thereto under the terms of this Note and the other Transaction Documents. Except in the case of a Company default, the Notes are convertible by the investor at a price of $40.00 per share. Concurrently with the Securities Purchase Agreement, the Company also issued to the investor warrants (the "Warrants") to purchase 6,906 shares of the Company’s common stock at an exercise price of $75.00 per share subject to adjustment as more fully set forth in the warrant agreement. The Warrants also contained a cashless exercise provision. The Warrants were for a term of two (2) years. In accordance with the warrant agreement as described in Note 5, the warrant price was reset to equal the conversion price associated with these new debt agreements from the stated strike price of $75.00.

On May 18, 2015, Typenex Co-Investment, LLC (“Typenex”) filed a binding arbitration notice against the Company in the State of Utah, Case No. 150903317 (the “Utah Lawsuit”) regarding a certain Warrant to Purchase Shares of Common Stock (the “Warrant”) issued by the Company to Typenex on April 28, 2014 (the “Arbitration”) in connection with a Convertible Promissory Note of the same date (the “Note”). On April 29, 2015, Typenex sent a Notice of Exercise to the Company for the issuance of 75,415 shares of the Company’s common stock (the “Initial Shares”) based on a cashless exercise provision contained in the Warrant along with an opinion letter indicating the shares should be issued without restrictive legend pursuant to Rule 144 under the Securities Act of 1933, as amended. The Company immediately filed for an emergency injunction in the State of New Jersey, the location of the Company’s transfer agent. The injunction was granted The Company has filed a response and counterclaim to the Arbitration notice alleging, among other things, that Typenex did not fulfill its obligations under the original Note and failed to disclose material matters regarding Typenex and its principal to the Company and requested damages and attorneys’ fees be paid by Typenex to the Company.

On September 8, 2015, the Company’s transfer agent was required to release the Initial Share to Typenex as a result of the Company failing to maintain the bond requirement agreed to by the Company and Typenex as part of the injunction. The number of Initial Shares is based on a price reset to equal the conversion price associated with the Note. The price reset which resulted in the partial conversion to 75,415 common shares based on the difference between the current market value (market price of $25.00 multiplied by exercise shares of 6,906) and the exercise price ($3.75) multiplied by number of exercise shares (6,906.) This number is then divided by the adjusted price of the common stock ($1.946.)

On October 13, 2015, Typenex and the Company participated in a mediation in an attempt to resolve the Utah Lawsuit without either party having to incur additional legal and court fees. As a result of the mediation and in order to resolve the Utah Lawsuit and the Arbitration and all other disputes between, on November 17, 2015 (the “Typenex Effective Date”), the Company and Typenex entered into a Settlement Agreement, Waiver and Release of Claims (the “Settlement Agreement”) and related Exchange Agreement (the “Exchange Agreement”), Pursuant to the terms of the Settlement Agreement and Exchange Agreement, the Company agreed to issue to Typenex 80,000 shares of the Company’s common shares of stock in exchanges for any rights Typenex may or may not have had under the Warrant. The Company will deliver the shares to Typenex in two installments: (i) 40,000 Shares with five trading days of the Effective Date (the “First Installment Shares”) and (ii) 40,000 Shares on or before January 1, 2016 (the “Second Installment Shares”). The First Installment Shares and the Second Installment Shares are collectively referred to herein as the Typenex Shares.

F-18

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

Additionally, pursuant to the Settlement Agreement, beginning on January 1, 2016, Typenex shall have the right to put the Typenex Shares back to the Company (the “Put Right”) at the following prices: (a) for Typenex Shares put to the Company from January 1, 2016 to April 30, 2016 the price will be $1.00 per share; (b) for Typenex Shares put to the Company from May 1, 2016 to August 31, 2016 the price will be at $2.00 per share; and (c) any Typenex Shares put to Company between September 1, 2016 and December 31, 2016 the price will be at $3.00 per share. Typenex shall have the right to put up to 6,667 Typenex Shares per month to Company (the “Monthly Put Amount”) per month. If the number of Typenex Shares put to Company in a given month is less than the Monthly Put Amount such difference, the “Rollover Shares”, Typenex shall have the right to put such Typenex Shares to Company at any time in the same or immediately succeeding period. In addition to the Monthly Put Amount, Typenex shall also have the right to put up to 6,667 Rollover Shares per month to Company. At such time that Typenex’s Net Sales (gross proceeds of sales of the Typenex Shares sold in a minus any trading commissions or costs associated with clearing and selling such Typenex Shares minus the purchase price paid for any shares of Common Stock purchased on the open market) of Typenex Shares is equal to or greater than $200,000, Typenex’s Put Right shall automatically terminate and Typenex shall have no further rights to put Typenex Shares or Rollover Shares.

Additionally, Typenex agreed that during any calendar week it would not sell more Typenex Shares than the greater of (i) 10% of the weekly trading volume of the Common Stock as reported on Bloomberg, L.P. or (ii) an aggregate market value of $5,000.

Upon execution of the Settlement Agreement and Exchange Agreement, both parties released all claims each may have against the other relating to any other agreements to which both may be party except for any disputes that may arise under the Settlement Agreement, Exchange Agreement and the documents ancillary to both. Under the Settlement Agreement, the Company executed a Confession of Judgment in the amount of $500,000 (the “Confession of Judgment”). In the event the Company commits a material breach of the Settlement Agreement which is not cured within five trading days, Typenex shall have the right to enforce the Confession of Judgment. The Confession of Judgment, if filed as set forth above, would carry an interest rate of 12% until paid.

On March 25, 2016, the Company paid $55,000 to Typenex to settle all obligations resulting from these agreements.

Convertible Note dated February 4, 2015

On February 4, 2015, the Company entered into a convertible note in an amount up to $250,000 with an investor. The initial funding was in the gross amount of $27,500, with net proceeds received of $25,000. The $2,500 represents Original Issue Discount. The maturity date of this note was two years from the date that each tranche is paid. The note was convertible at the lesser of $0.065 or 60% of the lowest trade price in the 25 trading days previous to the conversion.

The Company was able to repay this note at any time on or before 90 days from the effective date (the date the Company receives the cash) of the note at no additional interest charge. If the note remained outstanding beyond the 90 days, there would have been a one-time 12% interest charge applied in addition to the Original Issue Discount recognized at the onset of the note. The investor had the right to convert at any time after the effective date of this note. The Company repaid this note on April 22, 2015 with accrued interest in the amount of $27,778. The maturity date of this note was two years from the date that each tranche is paid.

F-19

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

Convertible Note dated February 9, 2015

On February 9, 2015, the Company entered into a convertible note in an amount of $110,000 with an investor. The gross amount of the note is $110,000, with net proceeds received of $100,000. The $10,000 represents Original Issue Discount. The note will also bear interest at 4%, compounded annually. The maturity date of this note was one year from execution. The note may be converted, in whole or in part, into shares of the Company’s common stock. The conversion price will be 60%, equivalent to a 40% discount, of the lowest trading price of the Company’s common stock during the 25 trading days prior to conversion. For defaults, the note is immediately due and payable and subject to a penalty interest rate of 20%. On May 7, 2015 this note was assigned to M Capital Partners LLC in consideration for a payment of $145,000 by M Capital Partners LLC to the original note holder. The Company still owes the entire $110,000 note, however, the noteholder is M Capital Partners LLC. As a result of this assignment, the Company as noted above issued 300,000 shares of common stock to Iconic. The Company never reserved shares in the name of the noteholder and failing to maintain proper share reserves is a default event. In the event of default, the noteholder is permitted to declare all of the then outstanding principal amount of this note, including any interest due thereon, to be due and payable immediately without further action or notice. In the event of such acceleration, the amount due and owing to the holder shall be increased to 150% of the outstanding principal amount of the note held by the Holder plus all accrued and unpaid interest, fees, and liquidated damages, if any. Additionally, this note shall accrue interest on any unpaid principal from and after the occurrence and during the continuance of an event of default at a rate of 20%. The note would also accrue liquidated damages of $1,000 per day from and after the occurrence and during the continuance of an Event of Default. Since notice was not delivered to the Company prior to full settlement no such accelerated clauses were enacted nor were any related expenses incurred.

The note was permitted to be prepaid according to the following schedule: Between 1 and 45 days from the date of execution, the note may be prepaid for 105% of face value plus accrued interest. Between 46 and 90 days from the date of execution, the note may be prepaid for 110% of face value plus accrued interest. Between 91 and 135 days from the date of execution, the note may be prepaid for 125% of face value plus accrued interest. Between 136 and 180 days from the date of execution, the note may be prepaid for 135% of face value plus accrued interest. After 180 days from the date of execution, the note may not be prepaid without written consent from the investor.

On August 10, 2015, The Company entered into a share exchange agreement with the assignee noteholder to settle this note in full in exchange for 36,250 shares of the common stock. The stock was issued on June 2, 2015 at a value of $293,625 ($8.10 per share) and at the time was recorded to stock for services rendered, debt financing note incentive. The Company reclassified this amount from professional fees to Notes Payable, current portion in the amount of $110,000, interest paid (classified as a reduction to accrued interest) in the amount of $2,857, Interest expense, net of $6,016 and the loss from conversion of debt to equity in the amount of $174,752.

F-20

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

Convertible Note dated March 6, 2015

On March 6, 2015, the Company entered into an 8% convertible redeemable note with an investor in the amount of $31,500. The gross amount of the note is $31,500, with net proceeds received of $30,000. The $1,500 represents legal fees. This note was to mature on March 6, 2016. The investor is entitled, at its option, at any time, to convert all or any amount of the principal face amount of the note, then outstanding into shares of the Company’s common stock at a price for each share of common stock equal to 58% of the lowest trading price of the Company’s common stock as reported on the OTCQB for the fifteen prior trading days including the day upon which a notice of conversion is delivered.

The note may be prepaid according to the following schedule: Between 1 and 30 days from the date of execution, the note may be prepaid for 110% of face value plus accrued interest. Between 31 and 60 days from the date of execution, the note may be prepaid for 116% of face value plus accrued interest. Between 61 and 90 days from the date of execution, the note may be prepaid for 122% of face value plus accrued interest. Between 91 and 120 days from the date of execution, the note may be prepaid for 128% of face value plus accrued interest. Between 121 and 150 days from the date of execution, the note may be prepaid for 134% of face value plus accrued interest. Between 151 and 180 days from the date of execution, the note may be prepaid for 135% of face value plus accrued interest. After 180 days from the date of execution, the note may not be prepaid.

On October 2, 2015 the Company paid $34,000 in cash to a noteholder on an 8% convertible note with an original face value of $31,500 dated March 6, 2015. At the time of payment, the note had an unconverted principal balance of $17,000 and accrued unpaid interest of $779. The Company recognized a loss on this debt conversion in the amount of $16,221.

In September 2015, this noteholder converted $14,500 in principal and $620 in interest in exchange for 28,865 shares of common stock. The Company paid this note in full October 2, 2015. The Company realized a loss on extinguishment of debt in the amount of $16,221. The total payment to this noteholder was $34,000.

Convertible Note dated March 11, 2015

On March 11, 2015, the Company entered into an 8% convertible redeemable note with an investor in the amount of $52,500. The gross amount of the note is $52,500, with net proceeds received of $50,000. The $2,500 represents legal fees. This note was to mature on March 11, 2016. The investor is entitled, at its option, at any time, to convert all or any amount of the principal face amount of the note, then outstanding into shares of the Company’s common stock at a price for each share of common stock equal to 55% of the lowest trading price of the Company’s common stock as reported on the OTCQB for the fifteen prior trading days including the day upon which a notice of conversion is delivered.

In September 2015, this note holder converted $15,000 in principal and $640 in interest in exchange for 406 shares of common stock. On October 14, 2015, the noteholder converted $10,501 in principal and $499 of accrued interest. The Company paid this note in full for cash, with remaining accrued interest of $1,277 on October 14, 2015. The Company realized a loss on extinguishment of debt in the amount of $36,724. The total payment to this noteholder was $65,000.

F-21

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

Convertible Note dated March 13, 2015

On March 13, 2015, the Company entered into an 8% convertible redeemable note with an investor in the amount of $52,500. The gross amount of the note was $52,500, with net proceeds received of $50,000. The $2,500 represents legal fees. This note was to mature on March 13, 2016.

The investor was entitled, at its option, at any time, to convert all or any amount of the principal face amount of the note, then outstanding into shares of the Company’s common stock at a price for each share of common stock equal to 55% of the lowest trading price of the Company’s common stock as reported on the OTCQB for the fifteen prior trading days including the day upon which a notice of conversion is delivered.

On September 25, 2015, the Company paid this note face value in full with accrued interest in the amount of $2,246. The Company recognized a loss on debt extinguishment in the amount of $36,254. This note was satisfied with $75,000 in cash and 150 common shares of stock, issued in three equal blocks of free trading stock. These conversion shares are scheduled to be issued November 1, 2015; December 1, 2015 and January 1, 2016 and shall not have a value of less than $5,000 each. As of June 30, 2016, the Company has recorded a liability to issue stock in the amount of $15,000.

Convertible Note dated March 31, 2015

On March 31, 2015, the Company entered into an 8% convertible redeemable note with an investor in the amount of $105,000. The gross amount of the note is $105,000, with net proceeds received of $100,000. The $5,000 represents legal fees. This note was to mature on March 31, 2016.

On September 30, 2015, the Company paid this note face value in full for cash with accrued interest in the amount of $4,202. The Company recognized a loss on debt extinguishment in the amount of $41,986. The total payment to this noteholder was $151,188.

F-22

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

Convertible Note dated April 8, 2015

On April 8, 2015, the Company entered into a 10% convertible redeemable note payable with an investor in the amount of $53,000. The gross amount of the note is $53,000, with net proceeds received of $50,000. The $3,000 represents legal fees. This note was to mature on April 8, 2016. This note was funded on April 22, 2015, at which point the Company began to accrue interest.

The investor is entitled, at its option, at any time, to convert all or any amount of the principal face amount of the note, then outstanding into shares of the Company’s common stock at a price for each share of common stock equal to 60% of the lowest trading price of the Company’s common stock as reported on the OTCQB for the twenty prior trading days including the day upon which a notice of conversion is delivered.

The note may be prepaid at any time during the period beginning on the Issue Date and ending on the date which is three (3) months following the Issue Date (“Prepayment Termination Date”), Borrower shall have the right, exercisable on not less than five (5) Trading Days prior written notice to the Holder of this Note, to prepay the outstanding balance on this Note (principal and accrued interest), in full.

After the Prepayment Termination Date, the Borrower shall have no right to prepay this Note. For purposes hereof, the “Prepayment Factor” shall equal one hundred and fifty percent (150%), provided that such Prepayment factor shall equal one hundred and twenty percent (120%) if the Optional Prepayment Date occurs on or before the date which is three (3) months following the Issue Date hereof. During the month of October 2015, the Company paid $83,638 in cash to this noteholder representing the face value of $53,000 and accrued interest of $2,740. The Company recognized a loss on the debt conversion in the amount of $27,898.

Convertible Note 1 dated May 22, 2015

On May 22, 2015, the Company entered into an 8% convertible redeemable note payable with an investor in the amount of $137,500. The gross amount of the note is $137,500, with net proceeds received of $118,750. The $18,750 represents legal fees of $6,250 and Original Issue Discount of $12,500. This note was to mature on May 22, 2016. The note will also bear interest at 8%, compounded annually. The maturity date of this note is one year from execution. The note may be converted, in whole or in part, into shares of the Company’s common stock. The conversion price will be 68%, equivalent to a 32% discount, of the lowest trading price of the Company’s common stock during the 15 trading days prior to conversion. For defaults, the note is immediately due and payable and subject to a penalty interest rate of 24%.

On November 8, 2015, the Company paid this note face value in full for cash with accrued interest in the amount of $5,104. The Company recognized a loss on debt extinguishment in the amount of $55,351. The total payment to this noteholder was $197,955.

F-23

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

Convertible Note 2 dated May 22, 2015

On May 22, 2015, the Company entered into a 12% convertible redeemable note payable with an investor in the amount of $82,500. The gross amount of the note is $82,500, with net proceeds received of $75,000. The $7,500 represents an Original Issue Discount. This note was to mature on May 22, 2016. The note will also bear interest at 12%, compounded annually. The maturity date of this note is one year from execution. The note may be converted, in whole or in part, into shares of the Company’s common stock. The conversion price will be the lower of 60%, equivalent to a 40% discount, of the lowest trading price of the Company’s common stock as of the date of conversion notice or $10.00 per share. For defaults, the note is immediately due and payable and subject to a penalty interest rate of 18%.

As consideration for the holder’s commitment to purchase this debenture, borrower issued to holder 40 shares of the Company’s common stock. These commitment fee shares have been earned in full upon holder’s purchase of this debenture; none of the commitment fee shares will be returned in the event of prepayment of the note.

On October 14, 2015, the Company paid this note face value in full for cash with accrued interest in the amount of $3,960. The Company recognized a loss on debt extinguishment in the amount of $30,224. The total payment to this noteholder was $116,684.

Convertible Note dated June 8, 2015

On June 8, 2015, the Company entered into a 12% convertible redeemable note payable with an investor in the amount of $100,000. The gross amount of the note is $100,000, with net proceeds received of $96,500. The $3,500 represents legal fees. This note matures on June 8, 2016. The note will also bear interest at 12%, compounded annually. The maturity date of this note is one year from execution. The note may be converted, in whole or in part, into shares of the Company’s common stock. The conversion price will be the lower of closing price of the common stock on the principle market on the training day immediately preceding the closing date or 35%, equivalent to a 65% discount, of the lowest trading price of the Company’s common stock during the 20 trading days prior to conversion and the closing sale price of the common stock on the principal market on the trading day immediately preceding the closing date. Under terms of the convertible note agreement, if the closing sale price at any time falls below $5.00, then such 35% figure specified above shall be reduced to 20%, equivalent to an 80% discount. The stock closing price went below $5.00 per share in the three months ended September 30, 2015. For defaults, the note is immediately due and payable and subject to a penalty interest rate of 24%.

The note may be prepaid according to the following schedule: Between 1 and 90 days from the date of execution, the note may be prepaid for 120% of face value plus accrued interest. Between 91 and 180 days from the date of execution, the note may be prepaid for 140% of face value plus accrued interest. After 180 days from the date of execution, the note may not be prepaid.

As prescribed in the convertible note agreement, the Company was required to maintain a sufficient number of shares, free from preemptive rights, to provide for the issuance of common stock upon conversion. The Company was required at all times to authorize a reserve of five times the number of shares that are actually issuable upon full conversion of this note. The Company initially instructed the transfer agent to reserve 165,000 shares of common stock for the noteholder for issuance upon conversion. The noteholder waived the requirement of the reserve shares above and beyond what was needed to convert through the maturity date, notwithstanding the initial reserve amount. At September 30, 2015 the number of share that were necessary and issuable upon full conversion of then outstanding principal and accrued unpaid interest was 740,943. The shares needed to convert was based on 20% of the lowest trading price of the Company’s common stock as reported on the OTCQB for the twenty prior trading days including the day upon which a notice of conversion is delivered ($0.70.) Under terms of the convertible note contract, if the closing sale price at any time falls below $5.00, then such 35% figure specified above shall be reduced to 20%, equivalent to an 80% discount. The stock closing price was below $5.00 per share at June 30, 2016.

F-24

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

Convertible Note dated June 8, 2015 (Continued)

On January 4, 2016 the Company issued 166,700 shares of common stock to holder of a convertible note dated June 8, 2015. The noteholder converted $10,002 of principal only for the shares. The applicable conversion price was $0.06. Upon this conversion, the note had a remaining balance including default interest fees of $40,000.

On March 29, 2016, the Company entered into an agreement with this noteholder to amend this convertible note to cure the default clause of the original agreement (no notice of default was provided). The event of default was due to the Company’s inability to reserve sufficient shares required by the convertible note agreement based on the total authorized and unissued shares, which was subsequently cured with the increase of the authorized shares to 8,000,000,000 on March 15, 2016. The holder agreed to reset the total balance due to the “Adjust Current Balance” of $40,000. Also, under the agreement the price of future conversions will be set at $0.10. The Company was further required to reserve common shares of not less than 400,000. From the date of this agreement, the note shall not be subject to interest.

As of June 30, 2016, the Company has $40,000 outstanding on this note inclusive of accrued default interest fees.

On April 11, 2016 the Company issued 200,000 shares of common stock (of the 400,000) to the noteholder. The noteholder converted $2,030 of principal only for the shares. The applicable conversion price was $0.01015. Upon this conversion, the note had a balance of $37,970. Upon the issuance of the remaining 200,000 shares, any applicable loss on conversion will be recorded at that time.

Convertible Note dated June 10, 2015

On June 10, 2015, the Company entered into a 12% convertible redeemable note payable with an investor in the amount of $82,500. The gross amount of the note is $82,500, with net proceeds received of $75,000. The $7,500 represents an Original Issue Discount. This note matures on June 10, 2016. The note will also bear interest at 12%, compounded annually. The maturity date of this note is one year from execution. The note may be converted, in whole or in part, into shares of the Company’s common stock. The conversion price will be the lower of 60%, equivalent to a 40% discount, of the lowest trading price of the Company’s common stock as of the date of conversion notice or $6.00 per share. For defaults, the note is immediately due and payable and subject to a penalty interest rate of 18%.

The note may be prepaid according to the following schedule: Between 1 and 30 days from the date of execution, the note may be prepaid for 125% of face value plus accrued interest. Between 31 and 180 days from the date of execution, the note may be prepaid for 135% of face value plus accrued interest. After 180 days from the date of execution, the note may be prepaid for 145% of face value plus accrued interest.

Under terms of this agreement, the Company was required to set up an initial reserve of 150,000 common shares of stock for the potential conversion of convertible note principal and interest. This amount was duly reserved with transfer agent. The note holder is permitted under contract to request increases to this reserve of up to five times the number of shares required for the note to be fully converted. No such requests were made of the Company by the noteholder.

As consideration for the holder’s commitment to purchase this debenture, borrower issued to holder 6,000 shares of the Company’s common stock. These commitment fee shares have been earned in full upon holder’s purchase of this debenture; none of the commitment fee shares will be returned in the event of prepayment of the note.

F-25

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES(CONTINUED)

Convertible Note dated June 10, 2015 (Continued)

In December 2015, the noteholder in three (3) separate conversions, converted $47,250 into 600,000 shares of common stock. Two of these note conversions were performed at a price below par value. The result was that $22,500 represented a discount to the common stock (which is reflected net in APIC). After these conversions, the balance outstanding on this note at June 30, 2016 is $123,000 including default total penalties of $138,938 before conversions and payments.

In March 2016, the noteholder in three (3) separate conversions converted $11,188 of principal and accrued fees into 765,000 shares of stock leaving a balance due under this note including interest and fees of $143,000.

On March 25, 2016, the Company entered into an agreement with the noteholder to amend the clauses in the original note agreement. As a result, the Company was required to pay $20,000 in cash to the noteholder on or before March 31, 2016, which it did, and the noteholder agreed to reset the total balance due to the “Adjust Current Balance” of $123,000 representing 1,230,000 shares to be issued at $0.10. The Company issued these shares on June 14, 2016.

Convertible Note dated December 23, 2015

On December 23, 2015, the Company entered into a 12% convertible redeemable note payable with an investor in the amount of $72,263. This note matures on December 23, 2016. The note will also bear interest at 12%, compounded annually. The maturity date of this note is one year from execution. Any amount of principal or interest on this note which is not paid when due shall bear an interest rate of 24% per year (“default interest”.) The note may be converted, in whole or in part, into shares of the Company’s common stock. The conversion price will be the lower of 55%, equivalent to a 45% discount, of the lowest trading price of the Company’s common stock during the 20 consecutive training days immediately preceding the conversion date and the closing sale price of the common stock on the principal market on the trading day immediately preceding the closing date. If the Company share price at any time loses the bid (ex: 0.0001 on the “ask” and zero market makers on the bid on level 2), then the conversion price may, in the holder’s sole and absolute discretion, be reduced to a fixed conversion price of 0.001 (If lower than the conversion price otherwise.)

Under terms of this agreement, the Company was required to set up an initial reserve of 50,000 common shares of stock for the potential conversion of convertible note principal and interest with an additional reserve of 2,450,000 shares of common stock in the name of the holder for issuance upon conversion as soon as a sufficient number of on issued shares become authorized, no later than January 25, 2016. This amount was duly reserved with transfer agent. The Company is required to have authorized and reserved five times the number of shares that are actually issuing a ball upon full conversion of this note.

On March 29, 2016, the Company entered into an agreement with the noteholder to amend this convertible note. As a result, the Company was required to pay $6,271 in cash to the noteholder on or before March 31, 2016, which it did and the noteholder agreed to reset the total balance due to the “Adjust Current Balance” of $78,366. Also, under the agreement the price of future conversions will be set at $0.10. No shares have been issued to the noteholder subsequent to this agreement.

As of June 30, 2016, the outstanding total of $92,000 including accumulated penalties and interest $19,737 which was restructured as a convertible note with a fixed conversion of $0.10 with 0% annual interest.

F-26

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

Convertible Note dated December 24, 2015

On December 24, 2015, the Company entered into an 11% convertible redeemable note payable with an investor in the amount of $43,000. This note matures on December 24, 2016. The note will also bear interest at 11%, compounded annually. The maturity date of this note is one year from execution. Any amount of principal or interest on this note which is not paid when due shall bear an interest rate of 24% per year (“default interest”.) OID was recognized on this note in the amount of $18,000. Deducted from the cash proceeds of this note were $10,000 to cover legal and miscellaneous expenses. $15,000 was paid in cash to the Company.

The note may be converted, in whole or in part, into shares of the Company’s common stock. The conversion price will be the lower of 55%, equivalent to a 45% discount, of the lowest trading price of the Company’s common stock during the 20 consecutive training days immediately preceding the conversion date and the closing sale price of the common stock on the principal market on the trading day immediately preceding the closing date. If the company share price at any time loses the bid (ex: 0.0001 on the “ask” and zero market makers on the bid on level 2), then the conversion price may, in the holder’s sole and absolute discretion, be reduced to a fixed conversion price of 0.001(If lower than the conversion price otherwise.)

If the closing price at any time falls below $0.12 the conversion price will be the lower of 40%, equivalent to a 45% discount, of the lowest trading price of the Company’s common stock during the 20 consecutive training days immediately preceding the conversion date and the closing sale price of the common stock on the principal market on the trading day immediately preceding the closing date.

Under terms of this agreement, the Company was required to set up an initial reserve of 2,450,000 common shares of stock for the potential conversion of convertible note principal and interest as soon as a sufficient number of on issued shares become authorized, no later than January 25, 2016.

Under terms of this note, the Company was required to have a sufficient number of shares reserved to allow full conversion as of the test date of January 25, 2016. This subsequently triggered an event of default, although no formal notice of default was provided and reset the balance to an “Adjusted Principal Amount” which was defined as double the amount of outstanding principal on the test date.

On March 29, 2016, the Company entered into an agreement with the noteholder to amend this convertible note. As a result, the Company was required to pay $3,729 in cash to the noteholder on or before March 31, 2016, which it did, and the noteholder agreed to reset the total balance due to the “Adjust Current Balance” of $46,634. Also, under the agreement the price of future conversions will be set at $0.10. The Company has not issued any shares under this agreement.

As of June 30, 2016, the amount outstanding under this note was $43,000.

All convertible notes payable are due within one year and are reflected as current liabilities in the condensed consolidated balance sheet at June 30, 2016.

At June 30, 2016, the Company had $0 remaining in discount of the original issue discount with respect to these notes. Amortization of the original issue discount for the six months ended June 30, 2016 and 2015 was $19,829 and $6,958. Interest expense on the convertible notes for the six months ended June 30, 2016 and 2015 was $21,891 and $177,674, respectively. Accrued interest on these convertible notes for three months ended was six months ended June 30, 2016 was $0.

F-27

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 5-

CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES (CONTINUED)

Derivative Liability - Warrants

In accordance with Financial Accounting Standards Board (“FASB”) ASC 815, Derivatives and Hedging, the embedded conversion option in the Convertible Note, as well as the Warrants issued by the Company, are required to be accounted for as derivative instrument liabilities. Such liabilities are initially and continuously carried at fair value with changes in their fair value reported in income in each reporting period. Accounting for the conversion option in the Convertible Note and for the Warrants as derivative instruments is required because both the Convertible Note and the Warrants have down-round anti-dilution protection, or ratchet exercise prices, whereby the conversion or exercise price is reduced if the Company subsequently issues common stock, convertible securities or stock options or stock warrants at a lower price or with a lower exercise or conversion price. Such a provision is inconsistent with the “fixed for fixed” nature of an equity option and therefore the instruments do not meet one of the required tests for equity classification. In addition, because the Convertible Note and the Warrants are denominated in a currency (U.S. dollars) that is different from the Company’s functional currency (Canadian dollars), they do not meet the test of being indexed only to the Company’s common stock. When one or more instruments are accounted for as derivative liabilities at fair value, the proceeds received are first allocated to the initial fair value of those derivative instruments, with any remaining proceeds allocated to the initial carrying value of the Convertible Note, which is accounted for at amortized cost. Interest is accrued on the initial carrying value of the Convertible Note at whatever effective interest rate is required in order to equate the present value of the expected future cash flows associated with the Convertible Note with their initial carrying value. Stated interest on the Note (10% per annum) is not accrued separately but is included in the effective interest rate on the Convertible Note.

The fair value of the embedded conversion option in the Note and the fair value of the Warrants have been calculated using the call option value output from a binomial Lattice model. A binomial Lattice model assumes that the price of the stock that underlies an option follows a probability distribution in which the underlying event only has one of two possible outcomes - the market price of the stock can either go up or go down in the future.

The Lattice valuation model takes into account all of the assumptions that market participants would likely consider in negotiating the transfer of the embedded conversion option and the Warrants, namely, stock price, exercise price, time to expiration, volatility, risk-free rate and dividends.

The Company between November 26, 2014 and December 31, 2014, repaid the entire convertible note balance of $277,500 thus extinguishing the note. Upon the initial recording of the convertible note and warrants associated with the convertible note, a derivative liability was recorded as the convertible note and warrant each contained embedded derivatives as determined under ASC 815. Since the warrants associated with the convertible note has been exercised there is no outstanding liability as of June 30, 2016.

F-28

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 6-

STOCKHOLDERS’ DEFECIT

Preferred Stock

The Company was established on June 2, 2006 with 10,000,000 shares of preferred stock authorized with a par value of $0.001. The Company has not issued any preferred stock.

Common Stock

The Company was established on June 2, 2006 with 100,000,000 shares of common stock authorized with a par value of $0.001. On December 8, 2011, the Company amended the authorized stock to 150,000,000 shares. On March 17, 2014, the Company amended the authorized stock to 500,000,000 shares. On March 15, 2016 the Company’s shareholders ratified managements restructuring plan by approving the increase in authorized shares to 8,000,000,000.

On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the company to White Fox Ventures, Inc. (“White Fox”) to better reflect the new direction of the business and to effect a 100:1 reverse stock split. On May 27, 2016, the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol.

In 2015, the Company issued:

On January 20, 2015 1,500,000 shares were issued in the acquisition of Breathe which was accounted for as reverse merger.

On March 31, 2015 the Company issued 26,667 shares for $100,000 in an investment into Tauriga Sciences, Inc. (“TAUG”). The Company entered into a commercialization/license agreement with TAUG to jointly develop a new line of business involving CBD oil cartridges in on March 31, 2015. The Company received from TAUG 10,869,565 shares of TAUG common stock (with a value of $100,000) in exchange for their shares (reflected as an investment). Due to the very low stock value of both companies and with the Company exiting the eCigarette business both companies have impaired their respective investment to $0 as December 31, 2015.

On May 10, 2015 the Company issued a supplier 7,500 shares of common stock at a value of $22,500 for the payment of inventory ($3.00 per share) and 3,000 shares of common stock valued at $9,000 ($3.00 per share) to a former noteholder ("Iconic") as part of an Assignment and Assumption Agreement dated May 7, 2015.

269,839 common shares were issued for cash in the amount of $1,047,270 at an average share price of $3.90.

F-29

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 6-

STOCKHOLDERS’ DEFICIT (CONTINUED)

Common Stock (Continued)

718,588 shares of common stock for consulting services rendered and to be rendered accrued as of December 31, 2015 in the amount of $5,547,305 including the cost of 65,000 shares to be issued ($7.70 per share) including an agreement with Maxim Group LLC ("Maxim") to provide general financial advisory and investment banking services in exchange for 2.5% of the then issued and outstanding stock at the date of execution. The number of shares of common stock issued and outstanding at the time of this agreement was 2,763,527. At that date 2.5% of the issued and outstanding common stock equaled 69,088 shares. The Company, on May 18, 2015 canceled shares in the amount of 31,500 shares due to services never provided at a value of $157,500 ($5.00 per share).

850,743 common shares were issued for the conversion of principal and accrued interest by the holders of convertible notes at a value of $406,385 having and average share price of $0.50 at conversion.

171,500 common shares of stock to noteholders as commitment and assignment shares and recorded as debt financing cost at a value of $176,050 (average price $1.00.)

Under the first tranche of a July 2, 2015 securities purchase agreement, $240,000 was committed for purchase of common stock and warrants. Cash was received associated with this offering was $233,500, with $6,500 credited to the purchaser for legal fees. Under the second tranche of this agreement the amount to be funded will be $200,000. Second tranche closing date was to be a trading date no later than five (5) Business Days following the effective date of the Registration Statement. on which all of the transaction documents have been executed and delivered by the applicable parties thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount for the Second Tranche and (ii) the Company’s obligations. The Company filed Form S-1 “Registration Statement Under the Securities Act of 1933” (“S1”) on August 17, 2015. On October 2, 2015 the Company pursuant to Rule 477 promulgated under the Securities Act of 1933, as amended (the “Securities Act”) submitted a request for withdrawal of the previously filed S-1.

Under this agreement, the Company was obligated to issue 40,000 common shares of its stock at $6.00 per share subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the common stock that occur after the date of agreement. Final purchase price is subject to adjustment based on the closing price of the common stock on first adjustment date that is six (6) months immediately following the closing date (or if such date is not a trading day, the trading day immediately preceding such six (6) month period). Final purchase price is also subject to adjustment based on the second adjustment date based on the closing price of the common stock on thirty (30) days following the first adjustment date (or if such date is not a trading day, the Trading Day immediately preceding such date).

Under the agreement, at any time while warrants are outstanding, if the Company sold or grants any option to purchase, or sell or any common stock or common stock equivalents, at an effective price per share less than the exercise price then in effect but greater than $10.00 (price adjusted) will be considered a “dilutive issuance” and the holder of the warrant will be entitled to receive shares of common stock at an effective price per share that is less than the exercise price.

Cashless warrants registered in the name of such purchaser to purchase up to a number of shares of common stock equal to 100% of such purchaser shares for the first tranche, with an exercise price equal to $20.00, subject to adjustments whereby the Company may issue without further consideration. In the event that the first adjusted price is higher than the per-share purchase price but lower than $8.00 per share, 10% of the aggregate number of shares issued or issuable or 15% if equal to or lower than the per-share price. The Company must file Form S-1 with the SEC under terms of this agreement.

F-30

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 6-

STOCKHOLDERS’ DEFICIT (CONTINUED)

Common Stock (Continued)

Under this agreement, the Company reserved 250,000 shares of common stock to provide for the issuance of common shares, the adjustment shares and warrant shares. In the event that the company’s stock falls below $4.00 per share for three consecutive training days, the Company will immediately add an additional 150,000 shares to this reserve. In the event that the stock falls below $2.00 per share the three consecutive trading days the Company will immediately add an additional 200,000 shares of the reserve.

On August 25, 2015, the Company consented to an assignment agreement whereby the assignor received $265,000 cash in exchange for the transfer of rights pursuant to the securities purchase agreement dated July 2, 2015. As part of this agreement, the Company directly paid to assignee $180,000 in exchange for the assignee waiving all rights under the original agreement related to price adjustments, second tranche issuance and warrants.

On September 8, 2015 the cashless warrants to purchase 6,906 common shares were exercised to convert to 75,415 common shares based on a price reset to equal the conversion price associated with the debt agreements from the stated strike price of $75.00. The price reset which resulted in the conversion to 75,415 common shares based on the difference between the current market value (market price of $25.00 multiplied by exercise shares of 6,906) and the exercise price ($3.75) multiplied by number of exercise shares (6,906.) This number is then divided by the adjusted price of the common stock ($1.946.)

As of December 31, 2015, the Company has 4,708,113 shares of common stock issued and outstanding. As of December 31, 2015 the Company had a liability for stock of $82,710 for stock to be issued as conversion shares under the note settlement agreement of the March 13, 2015 8% convertible note. Share are to be issued in three issuances of 5,000 each not to have a value less than $5,000 each. Issuances are scheduled November 1, 2015; December 1, 2015 and January 1, 2015. The Company reversed liability for stock issuable under a distribution agreement in the amount of 50,000 common shares which had a value of $37,500 ($0.75 per share) due to that agreement no longer being in effect. The Company further has a liability for stock to be issued under a consulting agreement to issue 14,000 shares in the amount of $17,710 ($1.30 per share.) These shares do not include the shares owed to the noteholders as described in NOTE 5. The liability for those shares is included with the note payable balances.

The Company initiated payments in the amount of $180,000 to buy back price adjustment rights, warrants and additional issuance rights transferred to assignee under original stock purchase agreement dated July 2, 2015. The Company has the 40,000 share stock certificate in its possession pending the stock reissuance to a new certificate to assignee.

In 2016, the Company issued:

In the six months ended June 30, 2016, the Company issued 1,131,700 shares of common stock to holders of convertible notes dated. The noteholders converted $146,220 of principal and interest for the shares. The applicable conversion prices ranged from $0.01 to $0.10 per share.

In the six months ended June 30, 2016, the Company issued 858,326 shares of common stock to Giovanni and Peter Comito and their affiliates pursuant to the Comprehensive Settlement Agreement entered into on March 9, 2016 to convert $1,050,000 in notes payable and acquire the intellectual property of the Company.

In the six months ended June 30, 2016, the Company issued 550,000 common shares to a related party for the settlement of payments made on behalf of the Company. The Company recognized a loss on debt conversion for the amount in excess of the closing stock price on the day of issuance over the value of the liabilities settled in the amount of $12,500 (550,000 shares at $0.10.)

In the six months ended June 30, 2016, the Company issued 29,750,700 shares of common stock to Company board members and officers and other investors, who had invested $364,273 in the Company in the form of payment of various settlements and invoices outstanding. These investments were treated as a private placement with prices ranging from $0.01 to $0.18 per share.

On April 15, 2016, the Company issued 500,000 common shares pursuant to a settlement agreement entered into on March 30, 2016, concerning trademark litigation with plaintiff, Breathe LLC (a Florida organization.) Share issuance to be recorded at the closing price of the stock as of the day the Company entered into the settlement agreement in the amount of $50,000 ($0.10 per share.)

F-31

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 6-

STOCKHOLDERS’ DEFICIT (CONTINUED)

On June 17, 2016, the Company issued 97,000 common shares in exchange for May 18, 2016 payments of certain expenses related to the corporate filings in the amount of $47,000 and the funding of an investment in the amount of $50,000 in the common stock of a privately held company, Kudzoo, Inc. representing less than 2% of that company as an investment. This investment will be recorded at cost on the Company’s balance sheet.

Authorized Reserved Shares

Under terms of several of the Company’s convertible notes it was required under those note agreements at all times to authorize and reserve four and in some cases five times the number of shares that are actually issuable upon full conversion of said notes (based on the conversion price of the notes in effect from time to time.) The noteholders waived the requirement of the reserve shares above and beyond what was needed to convert through the maturity date, notwithstanding the initial reserve amount. The Company is required to make proper provisions so that there after there shall be a sufficient number of shares of common stock authorized and reserved, free from preemptive rights. The Company is further obligated to make any changes to its capital structure which would change the number shares of common stock into which said notes shall be convertible at the then current conversion price. Based on this calculation, the Company did not have sufficient authorized common shares to convert all convertible notes, and exercise all outstanding warrants from the unissued common shares as of December 31, 2015, however, cured any deficiency related to these provisions on March 15, 2016, upon the approval of the DEF 14A and amendments to the Certificates of Incorporation. As noted herein, the noteholders waived this requirement to the Company as they knew the Company was amending their charter to increase the authorized number of common shares to accommodate any conversions.

Stock Options

On August 12, 2013, the Company approved and enacted the 2013 Stock Incentive Plan (the “Plan”). Under the 2013 Stock Incentive Plan, the Company may grant options or share awards to its full-time employees, executive officers, directors and consultants up to a maximum of 8,000,000 common shares. Under the Plan, the exercise price of each option has been established at $25.00. Stock options vest as stipulated in the stock option agreement and their maximum term is 8 years.

The following table summarizes information about the Company’s stock options:

	June 30, 2016				December 31, 2015
			Weighted					Weighted
			average					average
	Number of		exercise		Number of			exercise
	options		Price		options			price

Options outstanding, beginning of period		-	$	-		2,000		$	25.00
Granted		-		-		-			-
Exercised		-				-			-
Forfeited		-				-			-
Expired		-	$	-		(2,000	)		(25.00)

Options outstanding, end of period		-		-		-			-

Under the Plan, the exercise price of each option has been established at $25.00. Stock options vest as stipulated in the stock option agreement and their maximum term is 8 years. In the year ended December 31, 2015 the last of these options expired. There are no outstanding options as of June 30, 2016.

Stock options-based compensation expense included in the condensed consolidated statements of operations and comprehensive loss for the six months ended June 30, 2016 and 2015 was $0.

F-32

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 6-

STOCKHOLDERS’ DEFICIT (CONTINUED)

Warrants

The following table summarizes the Company’s share warrants outstanding as of June 30, 2016 and December 31, 2015:

	June 30, 2016						December 31, 2015
			Weighted		Weighted					Weighted		Weighted
			average		Average					average		average
	Number of		remaining		Exercise		Number of			remaining		exercise
	warrants		life (years)		Price		warrants			life (years)		price

Warrants outstanding, beginning of year		-		-	$	-		15,406			1.5	$	66.00
Granted		-		-		-		-			-		-
Exercised		-		-		-		(6,906	)		-		-
Expired		-		-		-		(8.500	)		-		-

Warrants outstanding, end of year		-		-	$	-		-			-	$	-

On August 12, 2013, the Company approved and enacted the 2013 Stock Incentive Plan (the “Plan”). Under the 2013 Stock Incentive Plan, the Company may grant options or share awards to its full-time employees, executive officers, directors and consultants up to a maximum of 80,000 common shares. Under the Plan, the exercise price of each option has been established at $25.00. Stock options vest as stipulated in the stock option agreement and their maximum term is 8 years. 8,500 options were issued in 2013 which expired in 2015. As of June 30, 2016, there are no warrants outstanding.

NOTE 7-

LICENSE AGREEMENT AND INVESTMENT

On March 31, 2015, the Company and TAUG entered into a non-exclusive license agreement, whereby TAUG will provide CBD oil cartridges to be used in the Breathe eCigs Corp. e-cigarette. In accordance with the agreement, TAUG was to receive a royalty of 50% of the net revenues associated with the sale of specified list of products listed in the agreement. In addition, there was a share swap between TAUG and the Company to equate to $100,000. The Company issued 26,667 shares at $3.75 for the commercialization of the products. TAUG issued 10,869,565 shares of its stock to acquire the license agreement (investment).

Description	Amount
Stock issued	$	100,000

Total	$	100,000
Less: Management impairment valuation		100,000
Net June 30, 2016 and December 31, 2015 balances	$	-

Issued 26,667 shares of Company common stock		26,667
at $1.00 per share.	$	3.75
Share value	$	100,000
Less: Management impairment valuation	$	100,000
Net June 30, 2016 and December 31, 2015 balances	$	-

At March 30, 2016 it was determined by management of both companies that the value of the investment based on stock value and no business venture will be pursued was valueless. Therefore, the entire investment and commercialization fees recorded were written off completely.

F-33

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 8-

RELATED PARTY TRANSACTIONS

On August 24, 2015, the Company, received funds from 3476863 Canada Inc. (Peter Comito) in the amount of $50,000 under a Stock Purchase Agreement. The Company intended to convert these funds into equity through the issuance of common shares of stock. On March 28, 2016, the Company issued common shares under a settlement agreement to satisfy this obligation.

On September 22, 2015, Giovanni Comito purchased 104,000 shares of the Company’s common stock, par value $0.10, from Joshua Kimmel, the Company’s Chief Executive Officer, Chief Financial Officer and member of the Board of Directors, for an aggregate purchase price of $75,000. All such shares were “restricted securities” at the time of the purchase and will continue to be “restricted securities” as such term is defined under Rule 144 of the Securities Act of 1933, as amended.

On September 22, 2015, the Company issued an unsecured promissory note to Kimmel in consideration for gross proceeds to the Company of $75,000 (for which constitutes all proceeds received by Kimmel as part of the Comito Purchase). The Kimmel Note accrues interest at 4.5% per annum unless there is an event of default, in which case the interest rate increases to 9.0% per annum. The entire principal amount and all accrued but unpaid interest under the Kimmel Note will be due and payable by the Company no later than September 22, 2016. As of June 30, 2016, accrued interest was $2,552.

On September 30, 2015, the Company, issued an unsecured promissory note to Giovanni Comito in consideration for gross proceeds to the Company of $400,000 pursuant to a letter of intent (“LOI”) purchase agreement for the sale of intellectual property held by the Company. The Giovanni Comito Note accrues interest at 4.5% per annum unless there is an event of default in which case the interest rate increases to 9.0% per annum. The entire principal amount and all accrued but unpaid interest under the Giovanni Comito Note will be due and payable by the Company no later than March 31, 2016. On March 28, 2016 this obligation was satisfied with the collective issuance of 858,326 to settle a total of $1,050,000 related party notes related to the purchase of the Company’s intellectual property.

During the three months ended December 31, 2015 the Company, issued nine unsecured promissory note to Peter Comito and affiliate companies in consideration for gross proceeds to the Company of $500,000 pursuant to the LOI. The Note accrues interest at 4.5% per annum unless there is an event of default in which case the interest rate increases to 9.0% per annum. The entire principal amount and all accrued but unpaid interest under the Notes will be due and payable by the Company no later than six months after issuance. On March 28, 2016 this obligation was satisfied with the collective issuance of 858,326 to settle a total of $1,050,000 related party notes related to the purchase of the Company’s intellectual property.

On October 28, 2015, the Company, issued an unsecured promissory note to 9138-1095 Quebec Inc. (Angelo Chiapetta) in consideration for gross proceeds to the Company of $50,000 pursuant to the LOI. The 9138-1095 Quebec Inc. (Angelo Chiapetta) Note accrues interest at 4.5% per annum unless there is an event of default in which case the interest rate increases to 9.0% per annum. The entire principal amount and all accrued but unpaid interest under the 9138-1095 Quebec Inc. (Angelo Chiapetta) will be due and payable by the Company no later than April 28, 2016. On March 28, 2016 this obligation was satisfied with the collective issuance of 858,326 to settle a total of $1,050,000 related party notes related to the purchase of the Company’s intellectual property.

On November 4, 2015, the Company, issued an unsecured promissory note to 7091061 Canada Inc. (Carmine D'Argenio) in consideration for gross proceeds to the Company of $50,000 pursuant to the LOI. The 7091061 Canada Inc. (Carmine D'Argenio) Note accrues interest at 4.5% per annum unless there is an event of default in which case the interest rate increases to 9.0% per annum. The entire principal amount and all accrued but unpaid interest under the 7091061 Canada Inc. (Carmine D'Argenio) will be due and payable by the Company no later than May 4, 2016. On March 28, 2016 this obligation was satisfied with the collective issuance of 858,326 to settle a total of $1,050,000 related party notes related to the purchase of the Company’s intellectual property.

During the three months ended March 31, 2016 a related party paid expenses and debt on behalf of the Company in the amount of $42,500 which was agreed to be settled for 550,000 shares of Company stock, issued April 4, 2016.

During the six months ended June 30, 2016 related parties funded obligations of the Company in the amount of $437,584. This amount as of July 31, 2016, was $438,574. The Company issued 22,184,700 shares of common stock to settle these obligations through July 31, 2016, with $3,000 still due.

F-34

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 9-

PROVISION FOR INCOME TAXES

As of June 30, 2016, there is no provision for income taxes, current or deferred.

Net operating losses carryforward	$	3,312,367
Valuation allowance		(3,312,367	)
	$	-

The Company has approximately $9,742,000 in net operating losses as of June 30, 2016 available to offset future taxable income through 2036. The Company has established a valuation allowance equal to the full amount of the deferred tax assets due to the uncertainty of the utilization of the operating losses in future periods.

A reconciliation of the Company’s effective tax rate as a percentage of income before taxes and the statutory rate for year ended June 30, 2016 is summarized below:

Federal rate	34	%
State rate	-

Combined Tax Rate	34	%
Valuation allowance	(34	)%

NOTE 10-

COMMITMENTS

The Company had the following financial commitments, represented by lease agreements, as of June 30 2016,

Year ending December 31,
2016	$	45,181
2017		103,271
2018		50,013
	$	198,465

Rent expense for the three and six months ended June 30, 2016 was $3,561 and $7,122 compared to $1,187 and $1,187 for the same period in the prior year. All rental amounts are presented in discontinued operations.

On March 15, 2015 the Company entered into a 38-month lease agreement for office space 322 Nancy Lane, Suite 7, Knoxville, Tennessee. This office was the former operational headquarters for the Company. The Company is currently working with the landlord to find another tenant for this space and remove this obligation.

On April 25, 2016 the Company entered into a lease agreement for virtual office space on New York City, New York to conduct Company business and investor relations. Rent payments commenced on May 1, 2016. Total commitment is $2,790 with expiration of April 30, 2016.

On June 20, 2016, White Fox Japan LLC, the Company’s majority owned subsidiary entered into an approximately two-year lease for office space. The lease will commence on August 1, 2016, expiring June 19, 2018. Rent is fixed over the lease period at $7,300 per month.

F-35

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 11-

CURRENT LITIGATION

Trademark dispute

On August 5, 2015, the Company received a notice from Breathe, LLC, a Florida limited liability company (“Breathe LLC”), that the Company was violating Breathe LLC’s trademark rights under U.S. Trademark Registration No. 4,633,887 for the name “Breathe” filed on September 27, 2013 and a demand for the Company to immediately cease and desist from such use. The Company believes that it has rights of prior use to the name “Breathe” under the federal trademark laws. As such, on August 10, 2015, the Company filed (i) a Petition for Cancellation with the United States Patent and Trademark Office regarding U.S. Trademark Registration No. 4,633,887 and (ii) a Complaint against Breathe LLC in the United States District Court of Eastern District of Tennessee (the "Tennessee Court"), Civil Action No. 3:15-cv-00345 requesting a declaratory judgment regarding the Company’s rights to use the trademark. A default judgment is currently pending in the Tennessee Court against Breathe LLC for failure to respond to the Tennessee Court complaint. Breathe LLC has requested the default judgment not be entered and that it be given an extension of time to respond. The Tennessee Court has not ruled on Breathe LLC’s request as of the date of the filing of this Form 10-Q. On August 16, 2015, the Company was notified that on August 12, 2015 Breathe LLC filed a Complaint in the United States Southern District Court of New York (the “New York Court”), Civil Action N. 1:15-cv-06403, against the Company and its Chief Executive Officer, Joshua Kimmel, demanding, among other things, damages of $5,000,000 and an injunction restraining the Company from using the name “Breathe”. On November 8, 2015, the New York Court held a hearing regarding Breathe LLC’s request for a preliminary injunction. On the same day, the New York Court entered an order denying Breathe LLC’s request for a preliminary injunction finding "uncontroverted evidence showing that Kimmel began distributing, promoting and advertising electronic cigarettes with the "Breathe" mark prior to September 27, 2013". Despite the New York Court’s denial, the overall litigation continues. Although the Company believes it will prevail on the merits, there can be no guaranty that it will do so. If the Company is unable to prevail, it may be required to market its products under a different name.

As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company will pay two cash payments ($10,000 immediately and $15,000 was originally due by July 31, 2016 and was paid August 10, 2016.) The Company is also required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.

On April 15, 2016 the Company issued 500,000 shares of common stock pursuant to this agreement to be recorded at the closing price of the stock as of the day the Company entered into the settlement agreement in the amount of $50,000 (at par value.)

As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

F-36

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

JUNE 30, 2016

NOTE 12-

SUBSEQUENT EVENTS

Corporate Matters

Effective July 18, 2016, the Company has dismissed KBL LLP (the “Former Accounting Firm”) as its independent registered public accounting firm. Effective July 18, 2016, the Company has engaged Pritchett Siler & Hardy, PC Certified Public Accountants of 515 South 400 East, Suite 100 Salt Lake City, Utah (the “New Accounting Firm”) as its new independent registered public accounting firm as of and for the quarter ending June 30, 2016. The change in independent registered public accounting firm is not the result of any disagreement with the Former Accounting Firm.

On July 20, 2016 the Company began trading under its new ticker symbol, AWAW.

Effective August 13, 2016, Seth Shaw resigned from the Company as Chief Financial Officer and Director. The Company has agreed to buy back 3,200,000 shares issued to him as reimbursement for expenses which he paid personally. The Company will buy back the shares at a price of $0.01 for a total value of $32,000. Mr. Takehiro Abe will be appointed CFO upon Mr. Shaw’s departure.

Notes Payable

On August 9, 2016, the Company entered into a 12-month non-convertible note with a related party in the amount of the $25,000 bearing an interest rate of 8%. The note matures on August 9, 2017. If the note defaults, the lender at its deaccession may convert principal and accrued interest into common stock at a value of $0.01 per share.

Stock Issuances

On July 19, 2016, the Company issued 1,450,000 common shares to the holder of three convertible notes for the conversion of remaining principal.

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

The discussion of the financial condition and results of operations of the Company set forth below should be read in conjunction with the consolidated financial statements and related notes thereto included elsewhere in this Form 10-Q. This Form 10-Q contains forward-looking statements that involve risks and uncertainties. The statements contained in this Form 10-Q that are not purely historical are forward-looking statements within the meaning of Section 27a of the Securities Act and Section 21e of the Exchange Act. When used in this Form 10-Q, or in the documents incorporated by reference into this Form 10-Q, the words “anticipate”,“believe”,“estimate”,“intend” and “expect” and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, without limitation, the statements regarding the Company’s strategy, future sales, future expenses, future liquidity and capital resources. All forward-looking statements in this Form 10-Q are based upon information available to the Company on the date of this Form 10-Q, and the Company assumes no obligation to update any such forward-looking statements. The Company’s actual results could differ materially from those discussed in this Form 10-Q. Factors that could cause or contribute to such differences (“Cautionary Statements”) include, but are not limited to, those discussed in Item 1. Business — “Risk Factors” and elsewhere in the Company’s Annual Report on Form 10-K, which are incorporated by reference herein and in this report. All subsequent written and oral forward-looking statements attributable to the Company, or persons acting on the Company’s behalf, are expressly qualified in their entirety by the Cautionary Statements.

Corporate History

White Fox Ventures, Inc. is a Nevada corporation organized June 2, 2006. Our original name was Celtic Capital, Inc. On October 20, 2008, we changed our name to Entertainment Education Arts Inc. On May 12, 2010, we changed our name to DNA Precious Metals, Inc. On March 5, 2015 pursuant to an agreement and plan of merger, the Company changed its name to Breathe eCig Corp. On May 23, 2016, the Company changed its name to White Fox Ventures, Inc. to better reflect its new business direction after the trademark legal settlement and discontinuance of the eCigarette operation (White Fox Ventures, Inc. may. may also be referred to as “White Fox”, “we”, “us” or the “Company”).

From May 2010 through February 3, 2015, we were an exploration stage mining company. The Company’s focus was the development of the Montauban Mining Project, located in the Montauban and Chavigny townships near Grondines-West in Portneauf County, Quebec, Canada (“Montauban Mine Property” or “Property”). Recognizing the need to secure significant additional capital to put the Property into production, management began to focus its attention on other business opportunities which would not require the significant capital required to expand the Property. In furtherance thereof, on January 16, 2015 the Company entered into a share exchange agreement with Breathe LLC, a Tennessee limited liability company, whereby the Company acquired all of the issued and outstanding membership interests in Breathe LLC in consideration for the issuance of 1,500,000 shares of the Company’s common stock to the members of Breathe, LLC.

In connection with the acquisition of Breathe LLC, on March 5, 2015 we entered into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which the Company merged with its wholly owned subsidiary, Breathe eCig Corp., the sole purpose of the Merger was to effect a change of the Company's name from DNA Precious Metals, Inc. to Breathe eCig Corp.

With the acquisition of Breathe LLC, it was contemplated that the Company would spin-off the operations of its mining operations which were being conducted through the Company’s wholly owned subsidiary, DNA Canada, Inc (“DNAC”). Effective February 3, 2015, we declared a stock dividend whereby each of the Company’s shareholders on the record date (February 3. 2015) would receive one share of DNAC for every two shares of the Company’s common stock owned on the record date.

With the completion of the spin-off, the Company exited the mining field and its sole and exclusive business operations will be marketing its electronic cigarettes and related vapor devices.

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On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the company to White Fox Ventures, Inc. (“White Fox”) to better reflect the new direction of the business and to effect a 100:1 reverse stock split. On May 27, 2016, the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol.

Breathe eCigs Corp. Acquisition and Spin-off of DNA Canada, Inc.

On January 16, 2015 the Company entered into a share exchange agreement with Breathe LLC, a Tennessee limited liability company, whereby the Company acquired all of the issued and outstanding membership interests in Breathe LLC in consideration for the issuance of 1,500,000 shares of the Company’s common stock to the members of Breathe, LLC.

As a result of the transaction effected by the Exchange Agreement, the former Breathe shareholders members owned approximately 56% of the then issued and outstanding common stock of the Company. As a result, the Company accounted for this transaction as a reverse merger whereby the accounting acquirer and the comparative figures are those of Breathe.

Trademark Settlement/Disposal of eCigarette Operations

As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company will pay two cash payments ($10,000 immediately and $15,000 originally due by July 31, 2016 was paid on August 10, 2016) and issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016 at a value of $50,000) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. (at a value of $0 as this had been written off). The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.

As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

White Fox Ventures Inc.

In an agreement dated as of April 1, 2016, the Company acquired White Fox Ventures Inc. for in an undetermined amount of shares equating 85% of the total authorized capital of the Company. White Fox Ventures Inc., a Nevada Corporation was in existence less than 60 days and the only asset in the company was a license agreement that they entered into with a Japanese company. Since the license agreement only stipulated a royalty fee on sales, White Fox Ventures Inc. did not record a value to the agreement. When the Company was completing its due diligence on this acquisition, they determined that the agreement and acquisition were not in the best interests of the Company at this time. As a result of this, the agreement has been rescinded as noted in 8k filed with the SEC on May 16, 2016. The principal of White Fox Ventures Inc., Mr. Shinsuke Nakano (“Nakano”) and investors had invested $196,557 into the Company in the form of payment of various settlements and invoices outstanding. The investment was treated as private placement at $0.01, whereby the Company, on May 10, 2016, issued to Nakano and the investors 19,655,700 shares of common stock, which will represent about 71.7% of the shares issued and outstanding at the time the agreement was rescinded. In addition, for their investments, Nakano was named as the Chief Executive Officer of the Company and the Chairman of the Board and Mr. Abe to the position of Chief Operating Officer ("COO") and Director ("Board Member").

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The operations of White Fox Ventures, Inc.:

ABOUT WHITE FOX VENTURES, INC.

The Company was formed as Breathe, LLC in October 2013 and Breathe eCigs. Corp. was formed on December 31, 2014. On December 31, 2014, Breathe, LLC entered into a Bill of Sale to transfer 100% of the assets to Breathe eCigs Corp. Breathe eCigs Corp. operated as a development stage company that develops, markets and distributes electronic cigarettes (“E-cigarettes”), vaporizers, e-liquids (i.e., liquid nicotine) and related accessories. As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business. The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory. As of March 30, 2016, the Company re-entered the development stage.

With the departure of Joshua Kimmel on January 25, 2016 and the discontinuance of operations the Company the Company struggled to obtain capital to survive. The Company was able to settle debts for stock, obtain funding via related parties as well as a Japanese based investor group with principals of Japanese based White Fox, Co. Ltd. investing $327,218 as of June 30, 2016 and a total of $330,218 as of July 25, 2016.

On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the company to White Fox Ventures, Inc. (“White Fox”) to better reflect the new direction of the business and to effect a 100:1 reverse stock split. On May 27, 2016, the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol.

The Company, through its subsidiary will conduct all transactional operational activity of the Company. The subsidiary will plan, manage and promote seminars and classes in Japan.

BUSINESS STRATEGY

White Fox Ventures, Inc. operates business academies throughout Japan.

White Fox’s strategic goal is to profitably establish and expand its operations. The Company's new core focus is the establishment of business academies throughout Japan. The Company is launching its operations throughout Japan: Sapporo, Sendai, Tokyo, Matsumoto, Nagoya, Osaka, Okoyama, Kumamoto and Fukuoka. The Company also plans to launch its academy via online throughout Japan.

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White Fox is currently developing its online proprietary application to be exclusively utilized by its academy members. This application shall be available for direct downloading onto smartphones, such as: iPhones, Android as well as iOS and Tablet devices. The Company expects to launch this application sometime during autumn of 2016 (4th Quarter, 2016).

The Company is currently evaluating possible investment banking relationships in Japan as well as in New York for the purpose of securing additional working capital and further corporate advice. Management expects to start generating revenue by Q4 2016.

Management believes that White Fox is building a solid future for shareholders by establishing a strong corporate team focused on both the Company's product offering as well as multi-faceted support for such offerings. The management team is excited about its ongoing transition as a Publicly Traded Company and will do their best to achieve profitability and maintain stable growth as soon as possible. The Company will continue to update shareholders about important progress being realized.

Market Opportunity

We believe that the market potential in Japan and worldwide will continue to rise for the foreseeable future and believe we can garner 10,000 users and/or subscribers by Q2 2017.

The market opportunity for online financial academies is big and it represents a significant potential for the years to come. During a recent live meeting in Singapore with world-renonw United States Investors Mr. Jim Rogers quote It is unlikely that our children will visit a bank in the future and most unlikely they will ever visit a post office having said that the appetite for knowledge to learn the difference between savings and investing continues to grow with younger generations and they will find the answer to these questions via online academies such the one offer by White Fox Ventures, Inc.

Our management understands this opportunity and we take very seriously what we teach our audience, not only academically but also with hands on experience.

Our objective is to teach our members the different btw savings and investing and the options available to them.

Marketing and Growth Strategies

Marketing.

●	Collect/Purchase e-mail lists of prospective audience

●	Automated e-mail delivery to the e-mail addresses on the list（e.g., video ad distribution every day at 6:00 p.m. Market Launch May 2016）

●	Introduction of White Fox Online Academy videos.

●	Distribution agents will sell all White Fox products for a finder’s fee or commission or mark up.

Growth Strategies

We sell our products via Internet. In all likelihood, rate of getting new customers is 1% ~ 2% from our total emails or links sent or opened. We are currently making great effort to reach out to as many as potential new members from pre-selected lists. We currently have a list of 100,000 likely candidates. After obtaining new members or customers, we can sell other products for example products like our digital coins, special seminars, etc.

Upon the company reaching 10,000 members, we are planning to issue our own corporate debit card.

We believe our revenue flow will be somewhat stable from ongoing membership fees even without the various added income potentials previously described.

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Distributor and Wholesale Distribution:

E-Commerce:

Government Regulations

E-cigarette business

A recent United States Federal Court decision permits the United States Food and Drug Administration to regulate electronic cigarettes as “tobacco products” under the Family Smoking Prevention and Tobacco Control Act of 2009 and the United States Food and Drug Administration has indicated that it intends to do so.

Based on the December 2010 U.S. Court of Appeals for the D.C. Circuit’s decision in Sottera, Inc. v. Food & Drug Administration , 627 F.3d 891 (D.C. Cir. 2010), the United States Food and Drug Administration (the “FDA”) is permitted to regulate electronic cigarettes as “tobacco products” under the Family Smoking Prevention and Tobacco Control Act of 2009 (the “Tobacco Control Act”).

Under this Court decision, the FDA is not permitted to regulate electronic cigarettes as “drugs” or “devices” or a “combination product” under the Federal Food, Drug and Cosmetic Act unless they are marketed for therapeutic purposes.

Because we do not market our electronic cigarettes for therapeutic purposes, our electronic cigarettes are subject to being classified as “tobacco products” under the Tobacco Control Act. The Tobacco Control Act grants the FDA broad authority over the manufacture, sale, marketing and packaging of tobacco products, although the FDA is prohibited from issuing regulations banning all cigarettes or all smokeless tobacco products, or requiring the reduction of nicotine yields of a tobacco product to zero. Among other measures, the Tobacco Control Act (under various deadlines):

	●	Increases the number of health warnings required on cigarette and smokeless tobacco products, increases the size of warnings on packaging and in advertising, requires the FDA to develop graphic warnings for cigarette packages and grants the FDA authority to require new warnings;
	●	Requires practically all tobacco product advertising to eliminate color and imagery and instead consist solely of black text on white background;

	●	Imposes new restrictions on the sale and distribution of tobacco products, including significant new restrictions on tobacco product advertising and promotion as well as the use of brand and trade names;
	●	Bans the use of “light,” “mild,” “low” or similar descriptors on tobacco products;

	●	Gives the FDA the authority to impose tobacco product standards that are appropriate for the protection of the public health (by, for example, requiring reduction or elimination of the use of particular constituents or components, requiring product testing, or addressing other aspects of tobacco product construction, constituents, properties or labeling);
	●	Requires manufacturers to obtain FDA review and authorization for the marketing of certain new or modified tobacco products;

	●	Requires pre-market approval by the FDA for tobacco products represented (through labels, labeling, advertising, or other means) as presenting a lower risk of harm or tobacco-related disease;
	●	Requires manufacturers to report ingredients and harmful constituents and requires the FDA to disclose certain constituent information to the public;

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	●	Mandates that manufacturers test and report on ingredients and constituents identified by the FDA as requiring such testing to protect the public health, and allows the FDA to require the disclosure of testing results to the public;
	●	Requires manufacturers to submit to the FDA certain information regarding the health, toxicological, behavioral or physiologic effects of tobacco products;
	●	Prohibits use of tobacco containing a pesticide chemical residue at a level greater than allowed under federal law;
	●	Requires the FDA to establish “good manufacturing practices” to be followed at tobacco manufacturing facilities;
	●	Requires tobacco product manufacturers (and certain other entities) to register with the FDA; and
	●	Grants the FDA the regulatory authority to impose broad additional restrictions.

The Tobacco Control Act also requires establishment, within the FDA’s new Center for Tobacco Products, of a Tobacco Products Scientific Advisory Committee to provide advice, information and recommendations with respect to the safety, dependence or health issues related to tobacco products. As indicated above, the Tobacco Control Act imposes significant new restrictions on the advertising and promotion of tobacco products. For example, the law requires the FDA to finalize certain portions of regulations previously adopted by the FDA in 1996 (which were struck down by the Supreme Court in 2000 as beyond the FDA’s authority). As written, these regulations would significantly limit the ability of manufacturers, distributors and retailers to advertise and promote tobacco products, by, for example, restricting the use of color, graphics and sound effects in advertising, limiting the use of outdoor advertising, restricting the sale and distribution of non-tobacco items and services, gifts, and sponsorship of events and imposing restrictions on the use for cigarette or smokeless tobacco products of trade or brand names that are used for non-tobacco products. The law also requires the FDA to issue future regulations regarding the promotion and marketing of tobacco products sold or distributed over the internet, by mail order or through other non-face-to-face transactions in order to prevent the sale of tobacco products to minors.

It is likely that the Tobacco Control Act could result in a decrease in tobacco product sales in the United States, including sales of our electronic cigarettes.

While the FDA has not yet mandated electronic cigarettes be regulated as tobacco products, the FDA issued proposed regulations on April 25, 2014 seeking to regulate electronic cigarettes as tobacco products. Under these proposed rules, products meeting the statutory definition of “tobacco products,” except accessories of a proposed deemed tobacco product, would be subject to the Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Family Smoking Prevention and Tobacco Control Act (Tobacco Control Act). The Tobacco Control Act provides FDA authority to regulate cigarettes, cigarette tobacco, roll-your-own tobacco, smokeless tobacco, and any other tobacco products that the Agency by regulation deems to be subject to the law. Option 1 of the proposed rule would extend the Agency's “tobacco product” authorities in the FD&C Act to all other categories of products, except accessories of a proposed deemed tobacco product, that meet the statutory definition of “tobacco product” in the FD&C Act. Option 2 of the proposed rule would extend the Agency's “tobacco product” authorities to all other categories of products, except premium cigars and the accessories of a proposed deemed tobacco product, that meet the statutory definition of “tobacco product” in the FD&C Act. FDA also is proposing to prohibit the sale of “covered tobacco products” to individuals under the age of 18 and to require the display of health warnings on cigarette tobacco, roll-your own tobacco, and covered tobacco product packages and in advertisements. Further, the FDA proposed to extend its authority to cover additional products that meet the definition of a tobacco product under the proposed rule: Tobacco Products Deemed To Be Subject to the Food, Drug & Cosmetic Act (Deeming). Currently FDA regulates cigarettes, cigarette tobacco, roll-your-own tobacco and smokeless tobacco. Proposed newly “deemed” products would include: electronic cigarettes, cigars, pipe tobacco, certain dissolvables that are not “smokeless tobacco,” gels and water pipe tobacco.

If electronic cigarettes are regulated as proposed, the FDA will implement new rules to govern the labeling of electronic cigarettes, including smokeless tobacco product warning labels and “light,” “low,” “mild” or similar descriptors for tobacco products. These new laws are expected to have a significant public health impact by decreasing the number of people using tobacco products, resulting in lives saved, increased life expectancy, and lower medical costs. In addition, the FDA will also restrict the way electronic cigarette manufacturers, retailers, and distributers can advertise and promote cigarettes and smokeless tobacco products, especially marketing efforts designed to appeal to youth. Such restrictions relating to marketing, advertising, and promotion will include: prohibiting tobacco brand name sponsorship of any athletic, musical, or other social or cultural event, or any team or entry in those events, requiring that audio ads use only words with no music or sound effects, prohibiting the sale or distribution of items, such as hats and tee shirts, with cigarette and smokeless tobacco brands or logos and requiring that manufacturers receive a written order from FDA permitting the legal marketing of a new tobacco product. The FDA’s traditional “safe and effective” standard for evaluating medical products does not currently apply to tobacco. FDA evaluates new tobacco products based on a public health standard that considers the risks and benefits of the tobacco product on the population as a whole, including users and non-users. To legally market new tobacco products, a written order from FDA must be received permitting its marketing in the United States.

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The application of the Tobacco Control Act to electronic cigarettes could impose, among other things, restrictions on the content of nicotine in electronic cigarettes, the advertising, marketing and sale of electronic cigarettes, the use of certain flavorings and the introduction of new products. We cannot predict the scope of such regulations or the impact they may have on our company specifically or the electronic cigarette industry generally, though if enacted, they could have a material adverse effect on our business, results of operations and financial condition.

In this regard, total compliance and related costs are not possible to predict and depend substantially on the future requirements imposed by the FDA under the Tobacco Control Act. Costs, however, could be substantial and could have a material adverse effect on our business, results of operations and financial condition. In addition, failure to comply with the Tobacco Control Act and with FDA regulatory requirements could result in significant financial penalties and could have a material adverse effect on our business, financial condition and results of operations and ability to market and sell our products. At present, we are not able to predict whether the Tobacco Control Act will impact us to a greater degree than competitors in the industry, thus affecting our competitive position.

DISCUSSION OF RESULTS OF OPERATIONS

The following discussion should be read in conjunction with, and is qualified in its entirety by, our financial statement, and certain other financial information included elsewhere in this prospectus.

From May 2010 through February 3, 2015 the Company was exploratory stage-mining corporation. The Company did not commence mining operations nor did we generate revenues. With the acquisition of Breathe in January 2015, our sole business objective is the eCigarette industry. The mining operations were divested pursuant to a stock dividend received by the shareholders of the Company.

As a result of the Exchange Agreement, the Company accounted for this transaction as a reverse merger whereby Breathe was the accounting acquirer and the comparative period figures are those of Breathe.

We are an Emerging Growth Company:

We qualify as an “emerging growth company” under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:

●

have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;

●

comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);

●

submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency;” and

●

disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation.

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.

We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.

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Management’s Discussion and Analysis

Results of Operations for Three and Six Months Ended June 30, 2016 and 2015

Discontinued operations

For the six months ended June 30, 2016 the Company had virtually no revenue. With the resignation of Joshua Kimmel and the Company fighting several lawsuits, including trademark dispute litigation, during the six months ended June 30, 2016 the Company was unable to attain sufficient working capital to keep continuing operations going.

Cost of Sales from discontinued operations

For the three and six months ended June 30, 2016 and 2015 the Company had cost of goods sold amounts $0 and $1,851 compared to $7,057 and $7,057 for the same period in the prior year, related to monthly fees from the third-party inventory holding company which still holds our remaining inventory.

The Company agreed to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.

Loss from discontinued operations

For the three months ended June 30, 2016 and 2015 the loss from discontinued operations was $6,651 compared to $1,003,410. The difference was driven by marketing, general and administrative expenses and professional fees in 2015 as the Company was starting up operations.

For the six months ended June 30, 2016 and 2015 the loss from discontinued operations was $30,272 compared to $1,891,566. The difference was driven by marketing, general and administrative expenses and professional fees in 2015 as the Company was starting up operations.

Professional fees – For the three months ended June 30, 2016 and 2015 professional fees were $55,600 and $4,436,260. Professional fees include consulting fees paid to advisors involved with restructuring the Company. The other amounts expensed were for legal and accounting fees.

For the six months ended June 30, 2016 and 2015 professional fees were $185,901 and $4,459,807. Professional fees include consulting fees paid to advisors involved with restructuring the Company. The other amounts expensed were for legal and accounting fees.

General and administrative – For the three months ended June 30, 2016 and 2015 General and administrative expense was $10,617 and $62,967 compared to $34,190 and $86,540, respectively.

Net loss

Net loss. Total net loss for the three months ended June 30, 2016 and 2015 totaled $101,138 and $5,675,476. Net loss from continuing operation for the three months ended June 30, 2016 and 2015 was $94,577 and $4,672,066, respectively. Loss from discontinued operations for the three months ended June 30, 2016 and 2015 was $6,561 and $1,003,410.

Total net loss for the six months ended June 30, 2016 and 2015 totaled $303,852 and $6.675,780. Net loss from continuing operation for the six months ended June 30, 2016 and 2015 was $273,580 and $4,784,214, respectively. Loss from discontinued operations for the six months ended June 30, 2016 and 2015 was $30,272 and $1,891,566.

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Liquidity and Capital Resources

Total assets

To date, our operations have been primarily funded through debt and equity financing. During the six months ended June 30, 2016, we raised $47,500 through the issuance of notes and $382,584 through the sale of our common stock.

At June 30, 2016 we had no cash, prepaid expenses of $8,333, $50,000 investment in a privately held company consisting of less than 2% ownership, inventory value of $113,843 classified as an asset from discontinued operations. Total current assets were $172,176. Total assets were $172,176 of June 30, 2016. At December 31, 2015, we had cash totaling $10,955.

Total liabilities

Current liabilities at June 30, 2016 totaled $905,136 as compared to $2,271,674 at December 31, 2015. Of our current liabilities as of June 30, 2016 included $172,970 related to current notes payable, as well as accrued interest of $2,552. Notes payable for related parties for the period ended June 30, 2016 was $75,000 compared to $1,175,000 at December 31, 2015. The decrease was due to the March 28, 2016 settlement of this obligation with the collective issuance of 85,832,640 to settle a total of $1,050,000 related party notes related to the purchase of the Company’s intellectual property lawsuit. Other current liabilities at June 30, 2016 were a liability to issue stock $51,021 and accounts payable of $353,150 compared to $444,670 at December 31, 2015. Liabilities from discontinued operations for the six months ended June 30,2016 were $250,443 compared to $232,771 at December 31, 2015. We had no long- term liabilities at June 30, 2016 or December 31, 2015.

We do not believe that our cash on hand at June 30, 2016 will be sufficient to fund our current working capital requirements. We will continue to seek additional equity financing. However, there is no assurance that we will be successful in our equity private placements or if we are that the terms will be beneficial to our shareholders.

Cash flow from operations. During the six months ended June 30, 2016 the Company had a negative cash flow from operations in the amount of $391,039 compared to negative cash flow from operations of $1,397,451 for the same period in the prior-year.

Cash flow used in investing activities. During the six months ended June 30, 2016 the company received $50,000 from investing activities compared $0 to the same period in the prior-year.

Cash flow from financing. During the six months ended June 30, 2016 the Company received $430,084 from financing activities compared to $1,446,520 for the same period in the prior year. During the three months ended June 30, 2016 the Company received $0 in proceeds resulting from the issuance of convertible notes compared to $770,250 for the same period in the prior year, $47,500 from promissory notes from related parties and $382,584 in proceeds from common stock issued.

Going Concern Qualifications

The condensed consolidated financial statements have been prepared on a going concern basis. The going concern basis of presentation assumes that the Company will continue in operation for the foreseeable future and be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The Company has generated net losses from continuing and discontinued operations totaling $202,714 and $1,000,304 for the six months ended June 30, 2016 and 2015, respectively. The Company’s continuation as a going concern is dependent upon, amongst other things, developing a new line of business as well as continued financial support from its shareholders and lenders, attaining a satisfactory revenue level, attainment of profitable operations and the generation of cash from operations and the ability to secure new financing arrangements and new capital to carry out its business plan. These matters are dependent on a number of items outside of the Company’s control and there exists material uncertainties that may cast significant doubt about the Company’s ability to continue as a going concern. On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the company to White Fox Ventures, Inc. (“White Fox”) to better reflect the new direction of the business and to effect a 100:1 reverse stock split. On May 27, 2016, the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol. The Company can give no assurance that it will achieve profitability or be capable of sustaining profitable operations in its new business of White Fox. These condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of the carrying amounts of assets or the amount and classification of liabilities that might result if the Company is unable to continue as a going concern. These factors raise substantial doubt regarding the ability of the Company to continue as a going concern. The Company recently raised $47,500 in net debt proceeds for which full settlement was attained by the issuance of common stock of the Company and $382,584 of equity proceeds during the six months ended June 30, 2016, to pay for the reorganization costs.

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ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURESABOUT MARKET RISK.

Not applicable

ITEM 4.

CONTROLS AND PROCEDURES.

As of the end of the period covered by this quarterly report on Form 10-Q, the Company’s Chief Executive Officer and Chief Financial Officer conducted an evaluation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15 and 15d-15 of the Securities Exchange Act of 1934). Based upon this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are not effective.

Changes in Internal Control over Financial Reporting

We regularly review our system of internal control over financial reporting to ensure we maintain an effective internal control environment. There were no changes in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS.

Trademark dispute

As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company will pay two cash payments ($10,000 immediately and $15,000 originally due by July 31, 2016 was paid on August 10, 2016.) The Company is also required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.

As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

-10-

ITEM 1A.

RISK FACTORS.

Prior to the disposal of continuing operations, substantially all of our revenue was derived from two distribution relationships. Our failure to maintain those relationships would have materially and adversely impact our future operating results.

We are a development stage company winding down a discontinued operation as we attempt to start a new line of business. We have generated minimal online revenues and distribution sales to two customers. The Company as a going concern is in doubt.

We are a development stage company and our only business line is discontinued. As an eCigarette company we did not achieve profitability. We are subject to all of the risks inherent in a new business. We have generated limited revenues only and all other sales have been to two other distributors. At June 30, 2016 we have a working capital deficit of $732,960 and an accumulated deficit of $9,742,257. We require additional capital to finance our discontinued operations as well as any future business lines. We currently have no commitment for additional funding and there can be no assurance that we will be able to secure additional funding, or if available, available on terms acceptable to us.

During our operations unexpected events may occur, including litigation, changes in government regulations, fires, floods, or earthquakes. It is not always possible to fully insure against such risks and we may decide not to take out insurance against such risks as a result of high premiums or for other reasons. Should such liabilities arise, they may impede our exploration activities, raise costs and otherwise reduce the commercial viability of the Property.

We have limited capital and will need to raise additional capital in the future.

White Fox does not currently have sufficient capital to fund both our continuing operations and its planned growth. The Company will require additional capital to continue to expand its operations. The Company may be unable to obtain additional capital when required. Future business development activities, as well as our administrative requirements (such as salaries, insurance expenses and general overhead expenses, as well as legal compliance costs and accounting expenses) will require a substantial amount of additional capital and cash flow.

White Fox may pursue sources of additional capital through various financing transactions or arrangements, including joint venturing of projects, debt financing, equity financing or other means. The Company may not be successful in identifying suitable financing transactions in the time period required or at all, and we may not obtain the capital we require by other means. If White Fox does not succeed in raising additional capital, White Fox’s operations will terminate and there is a risk of loss of your entire investment.

Any additional capital raised through the sale of equity may dilute the ownership percentage of our stockholders. Raising any such capital could also result in a decrease in the fair market value of your equity securities because our assets would be owned by a larger pool of outstanding equity. The terms of securities we issue in future capital transactions may be more favorable to our new investors, and may include preferences, superior voting rights and the issuance of other derivative securities, and issuances of incentive awards under equity employee incentive plans, which may have a further dilutive effect.

The Company’s ability to obtain financing may be impaired by such factors as the capital markets (both generally and in our industry in particular), our limited operating history, national unemployment rates and the departure of key employees. Further, economic downturns will likely decrease our revenues may increase our requirements for capital. If the amount of capital we are able to raise from financing activities, together with our revenues from operations, is not sufficient to satisfy our capital needs (even to the extent that we reduce our operations), we may be required to cease our operations, divest our assets at unattractive prices or obtain financing on unattractive terms.

We may not be able to successfully manage our growth, which could lead to our inability to implement our business plan.

Our growth is expected to place a significant strain on our managerial, operational and financial resources, especially considering that we currently only have a small number of executive officers, employees and advisors. Further, as we enter into various contracts or other transactions, we will be required to manage multiple relationships with various consultants, businesses and other third parties. There can be no assurance that our systems, procedures and/or controls will be adequate to support our operations or that our management will be able to achieve the rapid execution necessary to successfully implement our business plan. If we are unable to manage our growth effectively, our business, results of operations and financial condition will be adversely affected, which could lead to us being forced to abandon or curtail our business plan and operations.

-11-

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

For the six months ended June 30, 2016, the Company issued the following unregistered shares:

In the six months ended June 30, 2016, the Company issued 858,326 shares of common stock to the Comitos and their affiliates pursuant to the Comprehensive Settlement Agreement entered into on March 9, 2016 to convert $1,050,000 in notes payable and acquire the intellectual property of the Company.

On June 17, 2016, the Company issued 97,000 common shares in exchange for May 18, 2016 payments of certain expenses related to the corporate filings in the amount of $47,000 and the funding of an investment and in the common stock of a privately held company, Kudzoo, Inc. representing less than 2% of that company as an investment. This investment will be recorded at cost on the Company’s balance sheet.

All foregoing issuances were exempt from registration requirements under Section 4(2) and/or Rule 506 of Regulation D of the Securities Act of 1933, as amended.

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4.

MINE SAFETY DISCLOSURE.

Not applicable.

ITEM 5.

OTHER INFORMATION.

None.

-12-

ITEM 6.

EXHIBITS.

(a) Exhibits.

Exhibit
Number		Description
31.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101.INS		XBRL Instance Document.**
101.SCH		XBRL Taxonomy Extension Schema Document.**
101.CAL		XBRL Taxonomy Calculation Linkbase Document.**
101.LAB		XBRL Taxonomy Label Linkbase Document.**
101.PRE		XBRL Taxonomy Presentation Linkbase Document.**
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document. **

________________________________

*	filed or furnished herewith
**	submitted electronically herewith

-13-

Organization, Consolidation and Presentation of Financial Statements [Abstract]

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.

Date: August 19, 2016

	WHITE FOX VENTURES, INC.

	By:	/s/ Shinsuke Nakano, CEO Shinsuke Nakano, CEO Chief Executive Officer

	By:	/s/ Takehiro Abe
		Takehiro Abe, Director
		Chief Financial Officer

-14-

EX-31.1 2 awaw_ex311.htm CERTIFICATION awaw_ex311.htm

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Shinsuke Nakano, certify that:

1.	I have reviewed this Form 10-Q of WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.);

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 present in this report;

4.	I am 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 13-a-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.	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 involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 19, 2016	By:	/s/ Shinsuke Nakano
		Shinsuke Nakano Director, Chief Executive Officer WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.)

EX-31.2 3 awaw_ex312.htm CERTIFICATION awaw_ex312.htm

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Takehiro Abe, certify that:

1.	I have reviewed this Form 10-Q of WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.);

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 present in this report;

4.	I am 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 13-a-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.	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 involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 19, 2016	By:	/s/ Takehiro Abe
		Takehiro Abe
		Director, Chief Financial Officer WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.)

EX-32.1 4 awaw_ex321.htm CERTIFICATION awaw_ex321.htm

Exhibit 32.1

CERTIFICATION OF

PRINCIPAL EXECUTIVE OFFICER

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

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.) (the “Company”) on Form 10-Q for the quarter ending June 30, 2016, as filed with the U.S. Securities and Exchange Commission on the date hereof (the “Report”), I, Shinsuke Nakano, Director and Chief Executive Officer (Principal Executive Officer) of the Company, certify to the best of my knowledge, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

1.	Such Quarterly Report on Form 10-Q for the quarter ending June 30, 2016 , 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 such Quarterly Report on Form 10-Q for the quarter ending June 30, 2016 , fairly presents, in all material respects, the financial condition and results of operations of the Company.


Date: August 19, 2016	By:	/s/ Shinsuke Nakano
		Shinsuke Nakano
		Director, Chief Executive Officer WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.)

EX-32.2 5 awaw_ex322.htm CERTIFICATION awaw_ex322.htm

Exhibit 32.2

CERTIFICATION OF

PRINCIPAL FINANCIAL OFFICER

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

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.) (the “Company”) on Form 10-Q for the quarter ending June 30, 2016, as filed with the U.S. Securities and Exchange Commission on the date hereof (the “Report”), I, Seth Shaw, Chief Financial Officer (Principal Financial Officer) of the Company, certify to the best of my knowledge, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

1.	Such Quarterly Report on Form 10-Q for the quarter ending June 30, 2016 , 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 such Quarterly Report on Form 10-Q for the quarter ending June 30, 2016 , fairly presents, in all material respects, the financial condition and results of operations of the Company.


Date: August 19, 2016	By:	/s/ Takehiro Abe
		Takehiro Abe
		Chief Financial Officer WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.)

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The unaudited financial statements included herein have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). The financial statements and notes are presented as permitted on Form 10-Q and do not contain certain information included in the Companys annual statements and notes. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these financial statements be read in conjunction with the December 31, 2015 Form 10-K filed with the SEC, including the audited financial statements and the accompanying notes thereto. While management believes the procedures followed in preparing these financial statements are reasonable, the accuracy of the amounts are in some respects dependent upon the facts that will exist, and procedures that will be accomplished by the Company later in the year.   These unaudited financial statements reflect all adjustments, including normal recurring adjustments which, in the opinion of management, are necessary to present fairly the operations and cash flows for the periods presented.   On June 2, 2006, Celtic Capital, Inc. was incorporated in the State of Nevada. On October 20, 2008, Celtic Capital, Inc. changed its name to Entertainment Educational Arts Inc. On May 12, 2010, the Company changed its name to DNA Precious Metals, Inc. (the Company). On October 29, 2010, the Company formed DNA Canada Inc., a Canadian (Province of Quebec) incorporated company, as a wholly-owned subsidiary. The Company operated all of its exploration operations through this Canadian entity.   The Company acquired certain mining claims on June 9, 2011 located in the Montauban and Chavigny townships near Grondines-West in the Portneuf County of Quebec, Canada (Montauban Mine Property or Property).    On October 30, 2013 and November 27, 2013, the Company entered into binding agreements for the asset acquisitions of an undivided one hundred percent (100%) interest in certain mineral claims and mining assets located in the Province of Quebecs Montauban and Chavigny townships near Grondines West, in the county of Portneuf, specifically Mining Lease BM 748 and Mining Concession Miniere CM 410. The purchase price was CDN$75,000 together with the issuance of 10,500 common shares of the Company. The common shares for the acquisition were valued at their fair market value on the day they were issued which totaled $496,860. In connection with the asset purchase, the Company also issued 400 shares of common stock to a former supplier of the vendor for mining related information of the assets purchased valued at $20,000 along with cash consideration of CDN$20,000. The Company had been awaiting confirmation of the contemplated transaction from a bankruptcy court in Montreal, Quebec overviewing the financial restructuring of the vendor. The bankruptcy court approved the transaction on April 17, 2014.   On January 10, 2014, the Company entered into an asset purchase agreement for an undivided one hundred percent (100%) interest in certain mineral claims located in the Province of Quebecs Montauban and Chavigny townships near Grondines West, in the county of Portneuf, including claims, rights, concessions and leases. The purchase price was CDN$70,000, 10,000 common shares of the Company and a one percent (1%) net smelter return (NSR). The Company paid CDN$10,000 upon the signing of the asset purchase agreement with the cash balance due, along with the common shares, upon the closing of the asset purchase agreement and transfer of the mineral claims in the name of the Company. The transfer of the mineral claims was completed in February 2014 whereby the remaining cash balance due and the common shares were released to the vendor.   The common shares for the acquisition were valued at their fair market value on the day they were issued which totaled $340,000. The total cost of the acquisition amounted to $403,840.    On April 14, 2014, the Company entered into an asset purchase agreement for an undivided one hundred percent (100%) interest in fifty-seven (57) mining claims located in the Province of Quebecs Montauban and Chavigny townships near Grondines West, in the county of Portneuf. The purchase price was CDN$5,000 (US $4,547). The transfer of the mining claims has been completed by the Province of Quebec in the name of the Company.   On December 4, 2014, the Company presented a renewal request with the Government of the Province of Quebec to renew all 122 claims and this has been granted through a decision dated February 23, 2015.   On January 16, 2015, Breathe eCigs Corp., a Tennessee corporation (Breathe), entered into a Share Exchange Agreement (the Exchange Agreement) with the Company, whereby the Company acquired all of the issued and outstanding membership interests Breathe LLC in consideration for the issuance of 1,500,000 shares of the Companys common stock to the members of Breathe LLC.   As a result of the transaction effected by the Exchange Agreement, at closing Breathe became a wholly owned subsidiary of the Company, with the former Breathe shareholders owning approximately 56% of the then issued and outstanding common stock of the Company. The Company accounted for this acquisition as a reverse merger, whereby Breathe became the accounting acquirer. As a result, the comparative figures are those of Breathe.    In connection with the acquisition of Breathe LLC, on March 5, 2015 the Company entered into an Agreement and Plan of Merger (the Merger Agreement) pursuant to which the Company merged with its wholly owned subsidiary, Breathe eCig Corp., the sole purpose of the Merger was to effect a change of the Company's name from DNA Precious Metals, Inc. to Breathe eCig Corp. This name change more accurately reflects the Companys current operations.   With the acquisition of Breathe LLC, it was contemplated that the Company would spin-off the operations of its mining operations, which were being conducted through the Companys wholly owned subsidiary, DNA Canada, Inc. (DNAC).  Effective February 3, 2015, the Company declared a stock dividend whereby each of the Companys shareholders on the record date (February 3, 2015) would receive one share of DNAC for every two shares of the Companys common stock owned.   On February 3, 2015, the Company declared a stock dividend of its wholly owned subsidiary, DNA Canada, Inc. (DNAC) to the shareholders of record on February 3, 2015 whereby each shareholder of record received one share of DNAC for every two shares of DNA owned as of the record date.  The former members of Breathe LLC tendered their shares of DNAC for redemption by the Company.   With the completion of the spin-off, the Company was no longer in the mining field and its sole and exclusive business operations was the marketing of its electronic cigarettes and related vapor devices.   The Company in March 2015 entered into Distribution Agreements with various distributors for the distribution of the Companys products.   On May 11, 2015 the Company formed two wholly owned subsidiaries to conduct non-eCigarette related business by way of holding medical device and other related intellectual property for the future development of for-profit activates and/or partnerships. Currently these entities are inactive, and neither holds any assets, carry any liabilities nor hold any intellectual property.    On March 15, 2016, the Company had their DEF 14A approved by the SEC. As a result of this, the authorized common stock increased from 500,000,000 to 8,000,000,000 shares. The common share increase was approved by the Companys board of Directors on February 1, 2016.  In lieu of calling a special meeting of our stockholders, our Board of Directors had elected to obtain stockholder approval of the Authorized Share Increase Amendment by written consent (Written Consent) pursuant to Article II, Section 12 of our Bylaws and Section 78.370 of the Nevada Revised Statues. The close of business on February 18, 2016 was fixed as the record date for the determination of holders of our Common Stock entitled to receive notice of and discretion to approve the Authorized Share Increase Amendment.   On January 25, 2016, Mr. Seth M. Shaw succeeded Mr. Joshua Kimmel as Chief Executive Officer of the Company.  Mr. Kimmel resigned as a director and officer of the Company at that time.  On April 5, 2016, Mr. Shinsuke Nakano was appointed CEO of the Company.  Simultaneously, Mr. Shaw was appointed Interim Chief Financial Officer and Director.    As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company is required to pay two cash payments ($10,000 was paid on March 31, 2016 and $15,000 was originally due by July 31, 2016 and was paid on August 10, 2016.) Under this agreement, the Company also is required to issue 50 million restricted common shares of Company stock (which was issued April 15, 2016) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory. As of March 30, 2016, the Company re-entered the development stage.   On April 5, 2016, the Company announced its intention to give White Fox Ventures Inc. a majority controlling interest in the Company pursuant to an Acquisition Agreement by which White Fox Ventures Inc. was to be acquired for an undetermined number of shares equating 85% of the total authorized capital of the Company. The deal was to be effective April 15, 2016. On May 5, 2016, the Company announced that the deal will be rescinded based on the due diligence on this acquisition. It was determined that the agreement and acquisition were not in the best interests of the Company at this time. The principal of White Fox Ventures Inc., Shinsuke Nakano (Nakano), and investors had invested $196,557 into the Company in the form of payment of various settlements and invoices outstanding. The investment was treated as private placement at $0.0001, whereby the Company, on May 10, 2016, issued to Nakano and investors 19,655,700 shares of common stock. In addition, for their investments Nakano was named as the Chief Executive Officer of the Company and the Chairman of the Board and Mr. Abe was appointed to the positions of Chief Operating Officer ("COO") and Director ("Board Member".) An additional $65,000 was invested in May 2016 and an additional 6,500,000 shares are owed for this investment.   On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the company to White Fox Ventures, Inc. (White Fox) to better reflect the new direction of the business and to affect a 100:1 reverse stock split. On May 27, 2016, the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol.   On June 17, 2016, the Company formed a subsidiary with 99% majority ownership stake.  The subsidiary, White Fox Japan LLC, will be presented with a non-controlling interest of 1% for the share owned by related party, Company Chief Operating Officer and Director, Takehiro Abe.  The subsidiary will conduct all transactional operational activity of the Company.  The subsidiary will plan, manage and promote seminars and classes in Japan. The subsidiary has a fiscal year ended April 30, 2017.  As of June 30, 2016 there was no activity in the subsidiary.   On June 22, 2016, FINRA announced its final approval for the Companys change of name to White Fox Ventures, Inc., as well as a 1:100 Reverse Stock Split and the Companys new Ticker symbol, AWAW, which began trading on July 20, 2016.  All share figures are shown in this report are on a post reverse split basis.   The Company, through its subsidiary, White Fox Japan LLC will conduct all transactional operational activity of the Company.  The subsidiary will plan, manage and promote seminars and classes in Japan.   Going Concern   The condensed consolidated financial statements have been prepared on a going concern basis. The going concern basis of presentation assumes that the Company will continue in operation for the foreseeable future and be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The Company has generated net losses from operations totaling $303,852 and $6,675,780 for the six months ended June 30, 2016 and 2015, respectively.   The Companys continuation as a going concern is dependent upon, amongst other things, continued financial support from its shareholders, attaining a satisfactory revenue level, attainment of profitable operations and the generation of cash from operations and the ability to secure new financing arrangements and new capital to carry out its business plan.  These matters are dependent on a number of items outside of the Companys control and there exists material uncertainties that may cast significant doubt about the Companys ability to continue as a going concern.   On March 30, 2016, the Company discontinued the operations of its eCigarette business as a result of the settlement agreement they entered into with Breathe LLC. The agreement was the result of the difficulties of past management to operate that business effectively and profitably. With the departure of the past CEO, Joshua Kimmel, the Company was able to convert over $1,050,000 in debt in exchange for the intellectual property the Company owned in this industry, and agreed to exit this industry and sell off all remaining inventory during the next fiscal year.   On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the Company to White Fox Ventures, Inc. (White Fox) to better reflect the new direction of the business and to affect a 100:1 reverse stock split. On May 27, 2016 the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol.   On June 22, 2016, FINRA announced its final approval for the Companys change of name to White Fox Ventures, Inc., as well as a 1:100 Reverse Stock Split and the Companys new Ticker symbol, AWAW, which began trading on July 20, 2016.  All share figures are shown in this report are on a post reverse split basis.   The Company can give no assurance that it will achieve profitability in its new business or be capable of sustaining profitable continuing operations. These consolidated financial statements do not include any adjustments relating to the recoverability and classification of the carrying amounts of assets or the amount and classification of liabilities that might result if the Company is unable to continue as a going concern. These factors raise substantial doubt regarding the ability of the Company to continue as a going concern.   The Company raised $382,584 for the six months ended June 30, 2016, through the sale of common stock and was able to raise capital in the form of a note from a related party in the amount of $47,500.  The Company also converted $146,220 of promissory notes into shares of common stock.   Basis of Accounting   These consolidated financial statements are prepared in conformity with United States generally accepted accounting principles (U.S. GAAP) and are presented in U.S. dollars.   Use of Estimates   The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates include but are not limited to stock-based compensation and tax valuation allowances.

Principles of Consolidation   The condensed consolidated financial statements included the accounts of the Company and Breathe as the acquisition of Breathe was accounted for as a reverse merger and Breathe is the accounting acquirer, from the date that the Merger occurred between the Company and Breathe eCigs Corp. All intercompany transactions and accounts had been eliminated on consolidation. Effective March 11, 2015, the financial statements were no longer consolidated until April 2015 and the establishment of two new wholly-owned subsidiaries, which are inactive.   On June 17, 2016, the Company formed a subsidiary with 99% majority ownership stake.  The subsidiary, White Fox Japan LLC, will be presented with a non-controlling interest of 1% for the share owned by related party, Company Chief Operating Officer and Director, Takehiro Abe.  The subsidiary will conduct all transactional operational activity of the Company.  The subsidiary will plan, manage and promote seminars and classes in Japan. The subsidiary has a fiscal year ended April 30, 2017.  As of June 30, 2016 there was no activity in the subsidiary.   Business Combination   On January 16, 2015, Breathe entered the Exchange Agreement with the Company, whereby the Company acquired all of the issued and outstanding shares of common stock of Breathe in consideration for the issuance of 1,500,000 shares of common stock. This business combination was accounted for as a reverse merger whereby Breathe is the accounting acquirer as the former Breathe shareholders then controlled greater than 50% of the voting control of the Company.   In November 2014, the FASB issued ASU No. 2014-17, Business Combination. The provisions of ASU No. 2014-17 require management to determining whether and at what threshold an acquiree (acquired entity) can reflect the acquirers accounting and reporting basis (pushdown accounting) in its separate financial statements. The entities of the transaction were under common control from January 16, 2015 until February 3, 2015. Since neither unit of this business combination is in the development stage, nor had recognizable revenues during this period the application of push down accounting would not be of significant value to the readers of these condensed consolidated financial statements. The Company has not elected to apply pushdown accounting in its separate financial statements upon occurrence of this event.   Stock Based Compensation   The Company estimates the fair value of stock based payment awards made to officers and directors related to the Companys stock incentive plan, on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense ratably over the requisite service periods. The Company uses the Black-Scholes option pricing model to determine the fair value of the stock-based compensation that it grants to officers and directors. The Company is required to make certain assumptions in connection with this determination, the most important of which involves the calculation of volatility with respect to the price of its common stock. The computation of volatility is intended to produce a volatility value that is representative of the Companys expectations about the future volatility of the price of its common stock over an expected term. Shares of the Company commenced trading on August 22, 2013. As a result, the volatility value that the Company calculated may differ from the future volatility of the price of its shares of common stock.   Upon the exercise of stock options, any consideration received and the amounts previously recorded under stock-based compensation are credited to share capital. Upon the issuance of shares resulting from share awards, amounts previously recorded under stock based compensation are credited to share capital.    Comprehensive Income (Loss)   The Company adopted ASC 220-10, Reporting Comprehensive Income, (formerly SFAS No. 130). ASC 220-10 requires the reporting of comprehensive income in addition to net income from operations.   Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of information that historically has not been recognized in the calculation of net income.   Cash and Cash Equivalents   The Company considers all highly liquid debt instruments and other short-term investments with maturity of three months or less, when purchased, to be cash equivalents.   At June 30, 2016 the Company did not maintain cash or cash equivalent balances at any major United States bank.   Income Taxes   The Company uses the liability method of accounting for income taxes under which deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as part of the provision for income taxes in the period that includes the enactment date. Deferred tax liabilities are always provided for in full. Deferred tax assets are recognized to the extent that it is probable that they will be able to be utilized against future taxable income. Deferred tax assets and liabilities are offset only when the Company has a right and intention to set off current tax assets and liabilities from the same taxation authority. Valuation allowances are established, when necessary, to reduce deferred tax assets to amounts that are expected to be realized.   The Company accounts for income taxes pursuant to the provision of ASC 740-10, Accounting for Income Taxes (ASC 740-10) which requires, among other things, an asset and liability approach to calculating deferred income taxes. The asset and liability approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. A valuation allowance is provided to offset any net deferred tax assets for which management believes it is more likely than not that the net deferred asset will not be realized.   The Company follows the provision of ASC 740-10 related to Accounting for Uncertain Income Tax Position. When tax returns are filed, there may be uncertainty about the merits of positions taken or the amount of the position that would be ultimately sustained.   In accordance with the guidance of ASC 740-10, the benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions.   Tax positions that meet the more likely than not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above should be reflected as a liability for uncertain tax benefits in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. The Company believes its tax positions are all highly certain of being upheld upon examination. As such, the Company has not recorded a liability for uncertain tax benefits.   The Company has adopted ASC 740-10-25, Definition of Settlement, which provides guidance on how an entity should determine whether a tax position is effectively settled for the purposes of recognizing previously unrecognized tax benefits and provides that a tax position can be effectively settled upon the completion and examination by a taxing authority without being legally extinguished. For tax positions considered effectively settled, an entity would recognize the full amount of tax benefit, even if the tax position is not considered more likely than not to be sustained based solely on the basis of its technical merits and the statute of limitations remains open. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities generally for three years after they were filed.   Revenue Recognition   The Company recognizes revenues from the sale of the Companys products when the following criteria are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the price to the customer is fixed or determinable; and (iv) collection of the sales price is reasonably assured.  Delivery occurs when goods are shipped and title and risk of loss have passed to the customer.  Revenue is deferred in all instances where the earnings process is incomplete.  Payments received before all of the relevant criteria for revenue recognition are satisfied will be recorded as deferred revenue.  Revenues and costs of revenues from consulting contracts will be recognized during the period in which the service will be performed.  All revenues will be reported net of any sales discounts or taxes. Any revenues generated are included in discontinued operations.   Trade Receivables and Allowance for Doubtful Accounts   The Company was engaged up until March 30, 2016 in the sales and distribution in the consumer products market through sales to distributors, wholesalers and direct to consumers via e-commerce sales of eCigarettes for use by consumers.  Trade receivables consisted primarily of amounts due to the Company from their normal business activities whereby approved distributors and wholesalers are extended terms after down payments on orders. The Company controlled credit risk related to the trade receivables through credit approvals, credit limits and monitoring procedures, and perform ongoing credit evaluations of the customers. In assessing the carrying value of its trade receivables, the Company estimated the recoverability by making assumptions based on factors such as current overall and industry-specific economic conditions, historical and anticipated customer performance, historical write-off and collection experience, the level of past-due amounts, and specific risks identified in the accounts receivable portfolio. Additional changes to the allowance could be necessary in the future if a customers creditworthiness deteriorates, or if actual defaults are higher than the Companys historical experience. Any difference could result in an increase or decrease in the allowance for doubtful accounts. All accounts receivable, net of an allowance are considered assets from discontinued operations.   Inventory   Finished Goods Inventory - Finished goods inventory is stated at the lower of cost or market determined by the first-in, first-out method, and include salable eCigarette product items and supplies that are sale ready to ship to consumers, wholesalers or distributers. Shipping and handling costs (consisting of all costs to warehouse, pick, pack and deliver inventory to customers) will be included in cost of goods sold. Samples are included in marketing expenses which are a component of general and administrative costs. The Company in March 2015 entered into Distribution Agreements with various distributors for the distribution of the Companys products. The Company placed an initial order for merchandise in the amount of $437,750 on March 27, 2015. The Company has outsourced the assembly and production of its products held for resale and will not hold any of the product in its possession. The Companys inventory is received, housed and distributed by a third party fulfillment provider. As of June 30, 2016, the inventory held by the third party fulfillment provider had a value of $227,685.   As of March 30, 2016, pursuant to a settlement agreement under trademark litigation, the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company is required to pay two cash payments ($10,000 was paid on March 31, 2016 and $15,000 originally due by July 31, 2016 and was paid on August 10, 2016.)  Under this agreement, the Company is required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.   As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.   As a result of the settlement agreement and the resultant discontinuance of this operation, management feels that it could sell the current inventory at $.50 for each $1 of inventory therefore an allowance has been recorded to recognize the current expected net realizable value of the on-hand inventory in the amount of $113,843.  This amount is reflected in assets from discontinued operations.   Loss Per Share of Common Stock   Basic net loss per share (Basic EPS) is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding for the period.   Diluted earnings per share is computed by dividing adjusted net income available to common shareholders by the weighted average number of common shares outstanding adjusted for the effects of all dilutive common share issuances.   Dilutive common share issuances shall be deemed to have been converted into ordinary shares at the beginning of the period.   For the purpose of calculating diluted earnings per share, the Company shall assume the exercise of dilutive stock options and warrants, as well as shares reserved for the conversion of certain notes payable. The assumed proceeds from these instruments shall be regarded as having been received from the issue of common shares at the average market price of common shares during the period. Dilutive common share issuances are not included in the computation of diluted earnings per share when the Company reports a loss because to do so would be anti-dilutive for the periods presented.   Derivative Financial Instruments   The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.   The accounting treatment of derivative financial instruments may require that the Company for various instruments record the conversion option and related warrants at their fair values as of the inception date of the agreements, and at fair value as of each subsequent balance sheet date, should the characteristics of these instruments warrant the need to record the derivative liability.   During the year ended December 31, 2014, as a result of entering into the convertible notes, the Company was required to classify certain non-employee warrants as derivative liabilities and record them at their fair values at each balance sheet date. Any change in fair value was recorded as a change in the fair value of derivative liabilities for each reporting period at each balance sheet date. The Company reassessed the classification at each balance sheet date. If the classification changed as a result of events during the period, the contract was reclassified as of the date of the event that caused the reclassification.   The fair value of conversion options at a fixed number of shares are recorded using the intrinsic value method. Conversion options at variable rates and any options and warrants with ratchet provisions are deemed to contain a down-round protection. Accordingly, they do not meet the scope exception for treatment as a derivative under ASC 815 since down-round protection is not an input into the calculation of the fair value of the equity instruments and cannot be considered indexed to the Companys own stock, which is a for the scope exception as outlined under ASC 815.   The Company signed convertible notes and warrants and has determined that a conversion option is embedded in the note and it is required to bifurcate the conversion option from the host contract under ASC 815 and account for the derivatives at fair value. The estimated fair value of the conversion option was determined using the binomial model. The fair value of the conversion option was classified as a liability until the debt was converted by the note holders or paid back by the Company. The fair value was affected by changes in inputs to that model including the stock price, expected stock price volatility, the contractual term, and the risk-free interest rate. The Company continued to classify the fair value of the conversion option as a liability until the conversion option was exercised, expired or amended in a way that would no longer require these conversion options to be classified as a liability, whichever comes first. The Company has adopted a sequencing policy that reclassifies contracts (from equity to assets or liabilities) with the most recent inception date first. Thus any available shares are allocated first to contracts with the most recent inception date.   For the binomial lattice options pricing model, the Company used the following assumptions and weighted average fair value ranges as at the transaction date, April 28, 2014, and for the period ended June 30, 2016:   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">Convertible Notes:</td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> April 28, 2014</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 78%">Risk free interest rate</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">0.0577%</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">N/A</td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Dividend yield</td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Volatility</td> <td> </td> <td> </td> <td style="text-align: center">86.31%</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">Warrants:</td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> April 28, 2014</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 78%">Risk free interest rate</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">0.144%</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">N/A</td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Dividend yield</td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Volatility</td> <td> </td> <td> </td> <td style="text-align: center">97.33%</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> </table>   The Company had repaid the debt associated with the derivative liability in December 2014, however carried the warrants through the conversion of those warrants in September 2015. As a result of the conversion of the warrants, the entire derivative liability was extinguished as of September 30, 2015. The Company has no other instruments that contain embedded derivatives.   Prior to the effective date of the DEF 14A (March 15, 2016) which included the amendment to the Certificate of Incorporation increasing the authorized common shares of the Company from 500,000,000 to 8,000,000,000 shares, the Company did not have sufficient authorized shares to effectuate any conversion of convertible notes outstanding with either of the two noteholders. The Company remained in constant negotiations with the noteholders resulting in amended agreements dated March 25, 2016 and March 29, 2016, respectively, and the noteholders did not exercise their right to issue the Company a notice of default. At no time, did the Company consider that the notes outstanding could not be fully settled, with the DEF 14A progressing towards effectiveness. As the 14A was effective, prior to the issuance of this report, the Company in effect, cured any default under the note agreements, and as a result, no derivative liability was recorded by the Company. The amended note agreements reflect the current number of common shares needed to settle the remaining convertible note agreements and there are sufficient shares available to settle these agreements.   Reclassifications   Certain prior year amounts have been reclassified to conform to the current year presentation. The reclassifications had no effect on the net loss or cash flows of the Company.     Restated Financial Statements   Prior year amounts are presented in accordance with Amendment No. 1 on Form 10 Q/A for the quarters ended March 31, 2015 and June 30, 2015 as filed with the Securities and Exchange Commission on November 10, 2015. The required adjustments were made to correct the error to properly account for its accounting for the acquisition of Breathe eCigs Corp. (formerly Breathe LLC) on January 16, 2015 as a reverse merger for accounting purposes.   Recent Issued Accounting Standards   In February 2016, FASB issued ASU 2016-02, Leases (Topic 842). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period and is applied retrospectively. Early adoption is permitted. We are currently in the process of assessing the impact the adoption of this guidance will have on the Companys consolidated financial statements.   In February 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2015-02 (ASU 2015-02) "Consolidation (Topic 810): Amendments to the Consolidation Analysis." ASU 2015-02 changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. It is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. We are currently in the process of evaluating the impact of the adoption of ASU 2015-02 on our consolidated financial statements.   In November 2014, the FASB issued ASU No. 2014-17, Business Combination. The provisions of ASU No. 2014-17 require management to determining whether and at what threshold an acquiree (acquired entity) can reflect the acquirers accounting and reporting basis (pushdown accounting) in its separate financial statements. Since neither unit of this business combination is in the development stage, nor had recognizable revenues during this period the application of push down accounting would not be of significant value to the readers of these condensed consolidated financial statements.  The Company has not elected to apply pushdown accounting in its separate financial statements upon occurrence of this event.     During August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial StatementsGoing Concern. The provisions of ASU No. 2014-15 require management to assess an entitys ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of managements plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of managements plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this ASU are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company is currently assessing the impact of this ASU on the Companys consolidated financial statements.   During June 2014, the FASB issued an Accounting Standards Update No. 2014-10, "Development Stage Entities (Topic 915) - Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation ("ASU 2014-10")".  The objective of ASU 2014-10 is to improve financial reporting by reducing the cost and complexity associated with the incremental reporting requirements for development stage entities.  ASU 2014-10 is effective for annual reporting periods beginning after December 15, 2014, and interim periods therein.  The Company has elected early implementation, as permitted by the standard, for the interim period ending June 30, 2014.  All exploration stage language disclosures and amounts have been removed as a result of the adoption of ASU 2014-10.   The changes permit businesses and other organizations to first use subjective criteria to determine if an intangible asset has lost value. The amendments to U.S. GAAP will be effective for fiscal years starting after September 15, 2012. The Companys adoption of this accounting guidance does not have a material impact on the consolidated financial statements and related disclosures.   There were other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to have a material impact on the Companys financial position, results of operations or cash flows.

Breathe eCigs Corp. Acquisition and Spin-off of DNA Canada, Inc.   On January 16, 2015, Breathe eCigs Corp., a Tennessee corporation (Breathe), entered into a Share Exchange Agreement (the Exchange Agreement) with the Company, whereby the Company acquired all of the issued and outstanding shares of common stock of Breathe in consideration for the issuance of 1,500,000 shares of common stock.   As a result of the transaction effected by the Exchange Agreement, at closing Breathe became a wholly owned subsidiary of the Company, with the former Breathe shareholders owning approximately 56% of the then issued and outstanding common stock of the Company. The Company accounted for this acquisition as a reverse merger, whereby Breathe became the accounting acquirer. As a result, the comparative figures are those of Breathe.   The Company declared a stock dividend to its shareholders of record as of February 3, 2015 of its wholly owned subsidiary, DNA Canada, Inc. Each shareholder of record on this date will receive one share of DNA Canada, Inc. for every two shares of DNA Precious Metals Inc. owned by the shareholder on this date. All stock dividends will be rounded down to the next whole number. With the completion of the stock dividend, the Company, no longer has an equity interest in DNA Canada, Inc.   The former shareholders of Breathe participating in the stock dividend were required to tender for redemption any shares of DNA Canada, Inc. common stock received pursuant to the stock dividend in accordance with the Exchange Agreement.   With the acquisition of Breathe, management determined that it would be in the best interest of the Company and its shareholders to operate each company separate and independently of each other. The operation of DNA Canada, Inc. and Breathe were inconsistent. Breathe is a manufacturer    and distributor of e-cigarette and related products while DNA Canada, Inc. is an exploration stage mining company. The spin-off of DNA Canada, Inc. will allow each company to focus on its principal business activity and facilitate capital formation.   On March 5, 2015, the Company and Breathe entered into an Agreement and Plan of Merger pursuant to which the Company merged with its wholly owned subsidiary, Breathe. Upon the consummation of the Merger on March 11, 2015, the separate existence of Breathe ceased, and the shareholders of the Company became shareholders of the surviving company, named Breathe eCig Corp. As permitted under Nevada law, the sole purpose of the Merger was to affect a change to the Companys name from DNA Precious Metals, Inc. to Breathe eCig Corp. This change to the Amended Articles of Incorporation and name change took effect on March 11, 2015.

Trademark Settlement/Disposal of eCigarette Operations   As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company is required to pay two cash payments ($10,000 paid March 31, 2016 and $15,000 originally due by July 31, 2016 and was paid on August 10, 2016.) Under the agreement, the Company also is required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016 at a value of $50,000) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. (at a value of $0 as this had been written off). The Company further agrees to split 50/50 any future sales of its held inventory.  The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.   As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.   As a result of the disposal of the business and the discontinuance of the eCigarette operations, the following chart reflects the results of the condensed consolidated financial statements as loss from discontinued operations as of June 30, 2016:   <table cellspacing="0" cellpadding="0" style="width: 100%"> <tr> <td style="width: 100%; font: 12pt Times New Roman, Times, Serif; text-align: center">WHITE FOX VENTURES, INC.</td></tr> <tr> <td style="font: 12pt Times New Roman, Times, Serif; text-align: center">(FORMERLY BREATHE ECIG CORP.)</td></tr> <tr> <td style="font: 12pt Times New Roman, Times, Serif; text-align: center">CONSOLIDATED STATEMENTS OF DISCOUNTED OPERATIONS</td></tr> <tr> <td style="font: 12pt Times New Roman, Times, Serif; text-align: center">FOR THE THREE AND  SIX MONTHS ENDED JUNE 30, 2016 AND 2015</td></tr> <tr> <td style="font: 12pt Times New Roman, Times, Serif; text-align: center">(UNAUDITED)</td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="6" style="text-align: center">SIX MONTHS ENDED</td> <td nowrap="nowrap"> </td> <td style="text-align: center"> </td> <td colspan="6" style="text-align: center">THREE MONTHS ENDED</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="6" style="text-align: center">JUNE 30,</td> <td nowrap="nowrap"> </td> <td style="text-align: center"> </td> <td colspan="6" style="text-align: center">JUNE 30,</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">2016</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">2015</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: right">2016</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: right">2015</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 52%">REVENUE</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">19</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">6,000</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">-</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">6,000</td> <td nowrap="nowrap" style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">COST OF GOODS SOLD</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">1,851</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">7,057</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">7,057</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">GROSS LOSS</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,832</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,057</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,057</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>OPERATING EXPENSES</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-indent: 9pt">Research and development</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">2,178</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">1,648</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-indent: 9pt">Marketing, advertising and promotion</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">9,000</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">438,233</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">3,000</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">424,458</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-indent: 9pt">Rent</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">7,122</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">1,187</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">3,561</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">1,187</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-indent: 9pt">Salaries and related expenses, including stock-based compensation</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">10,911</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">114,150</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">97,649</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-indent: 9pt">Professional fees</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">1,155,236</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">323,712</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-indent: 9pt">Depreciation and amortization</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">12,449</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">9,195</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt; text-indent: 9pt">General and administrative</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">1,631</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">167,076</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">144,504</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt; text-indent: 45pt">Total operating expenses</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">28,664</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">1,890,509</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">6,561</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">1,002,353</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>OTHER (INCOME) EXPENSE</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt; text-indent: 9pt">Loss from Inventory valuation LCM</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(224</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt; text-indent: 45pt">Total other (income) expense</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(224</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Net loss before provision for income taxes</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(30,272</td> <td nowrap="nowrap">)</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(1,891,566</td> <td nowrap="nowrap">)</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(6,561</td> <td nowrap="nowrap">)</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(1,003,410</td> <td nowrap="nowrap">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">Provision for income taxes</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right"> </td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">Net loss</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">(30,272</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,891,566</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">(6,561</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,003,410</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td></tr> </table>     WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.) BALANCE SHEET FROM DISCONTINUED OPERATIONS <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="3" style="border-bottom: black 1.5pt solid"> December 31, 2015</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 78%">Assets of discontinued operations</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 8%; text-align: right">113,843</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: right">114,067</td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Liabilities of discontinued operations</td> <td style="text-align: right"> </td> <td>$</td> <td style="text-align: right">250,443</td> <td> </td> <td> </td> <td> </td> <td style="text-align: right">232,771</td> <td> </td></tr> </table>

The following summary of convertible notes payable and the related derivative liabilities associated with the convertible notes payable.  As a result of the reverse merger, Breathe assumed responsibility of these DNA Precious Metals, Inc. notes, and any related derivative liability that exists under these notes related to the warrant agreements. Therefore, a full discussion has been provided for clarification.   On August 6, 2014, the Company entered into an agreement with a U.S.-based private equity fund (Investor) under which the Company issued an unsecured Convertible Note (Convertible Note) in the principal amount of $250,000. The funds to be issued under the Convertible Note is $225,000 (Consideration). The Convertible Note includes an original issue discount of $25,000 (OID), calculated at 10% of the principal amount ($250,000). The initial Consideration paid to the Company on August 6, 2014 was $66,000. The Investor was able to pay additional Consideration to the Company in such amounts and at such dates as the Investor may choose in its sole discretion. The principal sum due to the Investor was prorated based on the Consideration actually paid by the Investor plus a 10% OID, as well as any other interest or fees, such that the Company is only required to repay the amounts funded and the Company is not required to repay any unfunded portions of the Convertible Note. The Company was able to repay the Convertible Note at any time on or before 90 days from the transaction date after which the Company was not permitted to make further payments on the Convertible Note prior to the Maturity Date without written approval from the Investor. If the Company made a payment of Consideration on or before 90 days from the transaction date, the interest rate on that payment of Consideration was to be at zero percent (0%). If the Company did not repay a payment of Consideration on or before 90 days from the transaction date, a one-time interest was to be a charge of 12% shall be applied to the principal amount. Any interest payable is in addition to the OID and that OID (or prorated OID, if applicable) remained payable regardless of time and manner of payment by the Company. The maturity date was two years from the transaction date of each payment ("Maturity Date") and was the date upon which the principal amount of the Convertible Note, as well as any unpaid interest and other fees, were due and payable. The Investor had the right, at any time after the transaction date, at its election, to convert all or part of the outstanding and unpaid principal amount and accrued interest (and any other fees) into fully paid and non-assessable shares of common stock of the Company.   The conversion price was the lesser of $1.60 or 60% of the lowest trade price in the 25 trading days prior to the conversion. Unless otherwise agreed in writing by both parties, at no time was the Investor convert any amount of the Convertible Note into common stock that would result in the Investor owning more than 4.99% of the common stock outstanding of the Company. At the time that this Convertible Note is outstanding, the Company agreed to reserve at least 100,000 shares of common stock for conversion. On October 30, 2014, the Company and the Investor entered into an amendment (Amendment #1), whereby the Company paid a partial note repayment in the amount of $33,333 on November 5, 2014 which equaled 50% of the note balance which includes $3,333 in interest, with the remaining balance due by January 6, 2015, which was repaid on December 29, 2014.   On April 28, 2014, the Company entered into a Securities Purchase Agreement (SPA), with a U.S.-based private equity fund, under which the Company issued a Secured Convertible Promissory Note (the Convertible Note) in the amount of $552,500.  The Convertible Note included an original issue discount of $50,000 (OID), calculated at 10% of the principal amount ($500,000), plus an additional $2,500 (Transaction Expense Amount) to cover the investors due diligence and legal fees in connection therewith.  The principal amount was to be paid to the investor in six (6) tranches of an initial amount under the Convertible Note of $250,000 and five (5) additional amounts of $50,000, with each of the additional amounts represented by Investor Notes (the Convertible Note and the Investor Notes are collectively referred to herein as the Notes). The initial $250,000 in cash was paid to the Company on April 29, 2014. Payment of the Notes were to be made on a monthly basis, beginning six months after the issue date when the Company received the initial $250,000, in the amount of $34,531 per month plus all accrued but unpaid interest and other costs, fees or charges payable, for sixteen (16) months until the balance is paid in full.  The Notes were convertible into common stock, at the option of the investor, at a price of $0.40 per share subject to adjustment in the case of a default, reorganization or recapitalization. In the event the Company elected to prepay all or any portion of the Notes, the Company was required to pay to the investor an amount in cash equal to 125% of the outstanding balance of the Notes, plus accrued interest and any other amounts owing. Interest accrued at the rate of 10% per annum. If the Company failed to repay the Notes when due, or if other events of default thereunder apply, a default interest rate of 22% per annum would apply. In addition, if the Company failed to issue stock to the investor within three trading days of receipt of a notice of conversion, the Company must pay a penalty equal to the greater of greater of $500 per day and 2% of the applicable conversion amount or installment amount, as applicable (but, in any event, the cumulative amount of such late fees shall not exceed the applicable conversion amount or installment amount). The Notes were secured by an interest in all right, title, interest, claims and demands of the Company in and to the property described in the Security Agreement, and all replacements, proceeds, products, and accessions thereof.    The Notes were convertible into shares of our common stock in six tranches, consisting of (i) an initial tranche in an amount equal to $277,500 and any interest, costs, fees or charges accrued thereon or added thereto under the terms of this Note and the other Transaction Documents (as defined in the Securities Purchase Agreement), and (ii) five (5) additional tranches, each in the amount of $55,000, plus any interest, costs, fees or charges accrued thereon or added thereto under the terms of this Note and the other Transaction Documents. Except in the case of a Company default, the Notes are convertible by the investor at a price of $40.00 per share. Concurrently with the Securities Purchase Agreement, the Company also issued to the investor warrants (the "Warrants") to purchase 6,906 shares of the Companys common stock at an exercise price of $75.00 per share subject to adjustment as more fully set forth in the warrant agreement.  The Warrants also contained a cashless exercise provision. The Warrants were for a term of two (2) years. In accordance with the warrant agreement as described in Note 5, the warrant price was reset to equal the conversion price associated with these new debt agreements from the stated strike price of $75.00.   On May 18, 2015, Typenex Co-Investment, LLC (Typenex) filed a binding arbitration notice against the Company in the State of Utah, Case No. 150903317 (the Utah Lawsuit) regarding a certain Warrant to Purchase Shares of Common Stock (the Warrant) issued by the Company to Typenex on April 28, 2014 (the Arbitration) in connection with a Convertible Promissory Note of the same date (the Note). On April 29, 2015, Typenex sent a Notice of Exercise to the Company for the issuance of 75,415 shares of the Companys common stock (the Initial Shares) based on a cashless exercise provision contained in the Warrant along with an opinion letter indicating the shares should be issued without restrictive legend pursuant to Rule 144 under the Securities Act of 1933, as amended. The Company immediately filed for an emergency injunction in the State of New Jersey, the location of the Companys transfer agent. The injunction was granted The Company has filed a response and counterclaim to the Arbitration notice alleging, among other things, that Typenex did not fulfill its obligations under the original Note and failed to disclose material matters regarding Typenex and its principal to the Company and requested damages and attorneys fees be paid by Typenex to the Company.   On September 8, 2015, the Companys transfer agent was required to release the Initial Share to Typenex as a result of the Company failing to maintain the bond requirement agreed to by the Company and Typenex as part of the injunction.  The number of Initial Shares is based on a price reset to equal the conversion price associated with the Note. The price reset which resulted in the partial conversion to 75,415 common shares based on the difference between the current market value (market price of $25.00 multiplied by exercise shares of 6,906) and the exercise price ($3.75) multiplied by number of exercise shares (6,906.) This number is then divided by the adjusted price of the common stock ($1.946.)   On October 13, 2015, Typenex and the Company participated in a mediation in an attempt to resolve the Utah Lawsuit without either party having to incur additional legal and court fees.  As a result of the mediation and in order to resolve the Utah Lawsuit and the Arbitration and all other disputes between,  on November 17, 2015 (the Typenex Effective Date), the Company and Typenex entered into a Settlement Agreement, Waiver and Release of Claims (the Settlement Agreement) and related Exchange Agreement (the Exchange Agreement), Pursuant to the terms of the Settlement Agreement and Exchange Agreement, the Company agreed to issue to Typenex 80,000 shares of the Companys common shares of stock in exchanges for any rights Typenex may or may not have had under the Warrant. The Company will deliver the shares to Typenex in two installments: (i) 40,000 Shares with five trading days of the Effective Date (the First Installment Shares) and (ii) 40,000 Shares on or before January 1, 2016 (the Second Installment Shares).  The First Installment Shares and the Second Installment Shares are collectively referred to herein as the Typenex Shares.   Additionally, pursuant to the Settlement Agreement, beginning on January 1, 2016, Typenex shall have the right to put the Typenex Shares back to the Company (the Put Right) at the following prices: (a) for Typenex Shares put to the Company from January 1, 2016 to April 30, 2016 the price will be $1.00 per share; (b) for Typenex Shares put to the Company from May 1, 2016 to August 31, 2016 the price will be at $2.00 per share; and (c) any Typenex Shares put to Company between September 1, 2016 and December 31, 2016 the price will be at $3.00 per share. Typenex shall have the right to put up to 6,667 Typenex Shares per month to Company (the Monthly Put Amount) per month.  If the number of Typenex Shares put to Company in a given month is less than the Monthly Put Amount such difference, the Rollover Shares, Typenex shall have the right to put such Typenex Shares to Company at any time in the same or immediately succeeding period.  In addition to the Monthly Put Amount, Typenex shall also have the right to put up to 6,667 Rollover Shares per month to Company.  At such time that Typenexs Net Sales (gross proceeds of sales of the Typenex Shares sold in a minus any trading commissions or costs associated with clearing and selling such Typenex Shares minus the purchase price paid for any shares of Common Stock purchased on the open market) of Typenex Shares is equal to or greater than $200,000, Typenexs Put Right shall automatically terminate and Typenex shall have no further rights to put Typenex Shares or Rollover Shares.   Additionally, Typenex agreed that during any calendar week it would not sell more Typenex Shares than the greater of (i) 10% of the weekly trading volume of the Common Stock as reported on Bloomberg, L.P. or (ii) an aggregate market value of $5,000.   Upon execution of the Settlement Agreement and Exchange Agreement, both parties released all claims each may have against the other relating to any other agreements to which both may be party except for any disputes that may arise under the Settlement Agreement, Exchange Agreement and the documents ancillary to both.  Under the Settlement Agreement, the Company executed a Confession of Judgment in the amount of $500,000 (the Confession of Judgment).  In the event the Company commits a material breach of the Settlement Agreement which is not cured within five trading days, Typenex shall have the right to enforce the Confession of Judgment.  The Confession of Judgment, if filed as set forth above, would carry an interest rate of 12% until paid.   On March 25, 2016, the Company paid $55,000 to Typenex to settle all obligations resulting from these agreements.   Convertible Note dated February 4, 2015   On February 4, 2015, the Company entered into a convertible note in an amount up to $250,000 with an investor. The initial funding was in the gross amount of $27,500, with net proceeds received of $25,000. The $2,500 represents Original Issue Discount. The maturity date of this note was two years from the date that each tranche is paid. The note was convertible at the lesser of $0.065 or 60% of the lowest trade price in the 25 trading days previous to the conversion.   The Company was able to repay this note at any time on or before 90 days from the effective date (the date the Company receives the cash) of the note at no additional interest charge. If the note remained outstanding beyond the 90 days, there would have been a one-time 12% interest charge applied in addition to the Original Issue Discount recognized at the onset of the note. The investor had the right to convert at any time after the effective date of this note.  The Company repaid this note on April 22, 2015 with accrued interest in the amount of $27,778.  The maturity date of this note was two years from the date that each tranche is paid.   Convertible Note dated February 9, 2015   On February 9, 2015, the Company entered into a convertible note in an amount of $110,000 with an investor. The gross amount of the note is $110,000, with net proceeds received of $100,000. The $10,000 represents Original Issue Discount. The note will also bear interest at 4%, compounded annually. The maturity date of this note was one year from execution. The note may be converted, in whole or in part, into shares of the Companys common stock. The conversion price will be 60%, equivalent to a 40% discount, of the lowest trading price of the Companys common stock during the 25 trading days prior to conversion. For defaults, the note is immediately due and payable and subject to a penalty interest rate of 20%. On May 7, 2015 this note was assigned to M Capital Partners LLC in consideration for a payment of $145,000 by M Capital Partners LLC to the original note holder. The Company still owes the entire $110,000 note, however, the noteholder is M Capital Partners LLC. As a result of this assignment, the Company as noted above issued 300,000 shares of common stock to Iconic.  The Company never reserved shares in the name of the noteholder and failing to maintain proper share reserves is a default event.  In the event of default, the noteholder is permitted to declare all of the then outstanding principal amount of this note, including any interest due thereon, to be due and payable immediately without further action or notice. In the event of such acceleration, the amount due and owing to the holder shall be increased to 150% of the outstanding principal amount of the note held by the Holder plus all accrued and unpaid interest, fees, and liquidated damages, if any. Additionally, this note shall accrue interest on any unpaid principal from and after the occurrence and during the continuance of an event of default at a rate of 20%.  The note would also accrue liquidated damages of $1,000 per day from and after the occurrence and during the continuance of an Event of Default. Since notice was not delivered to the Company prior to full settlement no such accelerated clauses were enacted nor were any related expenses incurred.   The note was permitted to be prepaid according to the following schedule: Between 1 and 45 days from the date of execution, the note may be prepaid for 105% of face value plus accrued interest. Between 46 and 90 days from the date of execution, the note may be prepaid for 110% of face value plus accrued interest. Between 91 and 135 days from the date of execution, the note may be prepaid for 125% of face value plus accrued interest. Between 136 and 180 days from the date of execution, the note may be prepaid for 135% of face value plus accrued interest. After 180 days from the date of execution, the note may not be prepaid without written consent from the investor.   On August 10, 2015, The Company entered into a share exchange agreement with the assignee noteholder to settle this note in full in exchange for 36,250 shares of the common stock. The stock was issued on June 2, 2015 at a value of $293,625 ($8.10 per share) and at the time was recorded to stock for services rendered, debt financing note incentive.  The Company reclassified this amount from professional fees to Notes Payable, current portion in the amount of $110,000, interest paid (classified as a reduction to accrued interest) in the amount of $2,857, Interest expense, net of $6,016 and the loss from conversion of debt to equity in the amount of $174,752.   Convertible Note dated March 6, 2015   On March 6, 2015, the Company entered into an 8% convertible redeemable note with an investor in the amount of $31,500. The gross amount of the note is $31,500, with net proceeds received of $30,000. The $1,500 represents legal fees. This note was to mature on March 6, 2016. The investor is entitled, at its option, at any time, to convert all or any amount of the principal face amount of the note, then outstanding into shares of the Companys common stock at a price for each share of common stock equal to 58% of the lowest trading price of the Companys common stock as reported on the OTCQB for the fifteen prior trading days including the day upon which a notice of conversion is delivered.   The note may be prepaid according to the following schedule: Between 1 and 30 days from the date of execution, the note may be prepaid for 110% of face value plus accrued interest. Between 31 and 60 days from the date of execution, the note may be prepaid for 116% of face value plus accrued interest. Between 61 and 90 days from the date of execution, the note may be prepaid for 122% of face value plus accrued interest. Between 91 and 120 days from the date of execution, the note may be prepaid for 128% of face value plus accrued interest. Between 121 and 150 days from the date of execution, the note may be prepaid for 134% of face value plus accrued interest. Between 151 and 180 days from the date of execution, the note may be prepaid for 135% of face value plus accrued interest. After 180 days from the date of execution, the note may not be prepaid.   On October 2, 2015 the Company paid $34,000 in cash to a noteholder on an 8% convertible note with an original face value of $31,500 dated March 6, 2015.  At the time of payment, the note had an unconverted principal balance of $17,000 and accrued unpaid interest of $779.  The Company recognized a loss on this debt conversion in the amount of $16,221.   In September 2015, this noteholder converted $14,500 in principal and $620 in interest in exchange for 28,865 shares of common stock.  The Company paid this note in full October 2, 2015.  The Company realized a loss on extinguishment of debt in the amount of $16,221.  The total payment to this noteholder was $34,000.   Convertible Note dated March 11, 2015   On March 11, 2015, the Company entered into an 8% convertible redeemable note with an investor in the amount of $52,500. The gross amount of the note is $52,500, with net proceeds received of $50,000. The $2,500 represents legal fees. This note was to mature on March 11, 2016. The investor is entitled, at its option, at any time, to convert all or any amount of the principal face amount of the note, then outstanding into shares of the Companys common stock at a price for each share of common stock equal to 55% of the lowest trading price of the Companys common stock as reported on the OTCQB for the fifteen prior trading days including the day upon which a notice of conversion is delivered.   In September 2015, this note holder converted $15,000 in principal and $640 in interest in exchange for 406 shares of common stock.  On October 14, 2015, the noteholder converted $10,501 in principal and $499 of accrued interest.  The Company paid this note in full for cash, with remaining accrued interest of $1,277 on October 14, 2015.  The Company realized a loss on extinguishment of debt in the amount of $36,724.  The total payment to this noteholder was $65,000.   Convertible Note dated March 13, 2015   On March 13, 2015, the Company entered into an 8% convertible redeemable note with an investor in the amount of $52,500. The gross amount of the note was $52,500, with net proceeds received of $50,000. The $2,500 represents legal fees. This note was to mature on March 13, 2016.   The investor was entitled, at its option, at any time, to convert all or any amount of the principal face amount of the note, then outstanding into shares of the Companys common stock at a price for each share of common stock equal to 55% of the lowest trading price of the Companys common stock as reported on the OTCQB for the fifteen prior trading days including the day upon which a notice of conversion is delivered.   On September 25, 2015, the Company paid this note face value in full with accrued interest in the amount of $2,246.  The Company recognized a loss on debt extinguishment in the amount of $36,254. This note was satisfied with $75,000 in cash and 150 common shares of stock, issued in three equal blocks of free trading stock.  These conversion shares are scheduled to be issued November 1, 2015; December 1, 2015 and January 1, 2016 and shall not have a value of less than $5,000 each.  As of June 30, 2016, the Company has recorded a liability to issue stock in the amount of $15,000.     Convertible Note dated March 31, 2015   On March 31, 2015, the Company entered into an 8% convertible redeemable note with an investor in the amount of $105,000. The gross amount of the note is $105,000, with net proceeds received of $100,000. The $5,000 represents legal fees. This note was to mature on March 31, 2016.   The investor was entitled, at its option, at any time, to convert all or any amount of the principal face amount of the note, then outstanding into shares of the Companys common stock at a price for each share of common stock equal to 55% of the lowest trading price of the Companys common stock as reported on the OTCQB for the fifteen prior trading days including the day upon which a notice of conversion is delivered.   On September 30, 2015, the Company paid this note face value in full for cash with accrued interest in the amount of $4,202.  The Company recognized a loss on debt extinguishment in the amount of $41,986. The total payment to this noteholder was $151,188.   Convertible Note dated April 8, 2015   On April 8, 2015, the Company entered into a 10% convertible redeemable note payable with an investor in the amount of $53,000. The gross amount of the note is $53,000, with net proceeds received of $50,000. The $3,000 represents legal fees. This note was to mature on April 8, 2016.  This note was funded on April 22, 2015, at which point the Company began to accrue interest.    The investor is entitled, at its option, at any time, to convert all or any amount of the principal face amount of the note, then outstanding into shares of the Companys common stock at a price for each share of common stock equal to 60% of the lowest trading price of the Companys common stock as reported on the OTCQB for the twenty prior trading days including the day upon which a notice of conversion is delivered.   The note may be prepaid at any time during the period beginning on the Issue Date and ending on the date which is three (3) months following the Issue Date (Prepayment Termination Date), Borrower shall have the right, exercisable on not less than five (5) Trading Days prior written notice to the Holder of this Note, to prepay the outstanding balance on this Note (principal and accrued interest), in full.   After the Prepayment Termination Date, the Borrower shall have no right to prepay this Note. For purposes hereof, the Prepayment Factor shall equal one hundred and fifty percent (150%), provided that such Prepayment factor shall equal one hundred and twenty percent (120%) if the Optional Prepayment Date occurs on or before the date which is three (3) months following the Issue Date hereof. During the month of October 2015, the Company paid $83,638 in cash to this noteholder representing the face value of $53,000 and accrued interest of $2,740.  The Company recognized a loss on the debt conversion in the amount of $27,898.   Convertible Note 1 dated May 22, 2015   On May 22, 2015, the Company entered into an 8% convertible redeemable note payable with an investor in the amount of $137,500. The gross amount of the note is $137,500, with net proceeds received of $118,750. The $18,750 represents legal fees of $6,250 and Original Issue Discount of $12,500. This note was to mature on May 22, 2016. The note will also bear interest at 8%, compounded annually. The maturity date of this note is one year from execution. The note may be converted, in whole or in part, into shares of the Companys common stock. The conversion price will be 68%, equivalent to a 32% discount, of the lowest trading price of the Companys common stock during the 15 trading days prior to conversion. For defaults, the note is immediately due and payable and subject to a penalty interest rate of 24%.     On November 8, 2015, the Company paid this note face value in full for cash with accrued interest in the amount of $5,104.  The Company recognized a loss on debt extinguishment in the amount of $55,351. The total payment to this noteholder was $197,955.   Convertible Note 2 dated May 22, 2015   On May 22, 2015, the Company entered into a 12% convertible redeemable note payable with an investor in the amount of $82,500. The gross amount of the note is $82,500, with net proceeds received of $75,000. The $7,500 represents an Original Issue Discount. This note was to mature on May 22, 2016. The note will also bear interest at 12%, compounded annually. The maturity date of this note is one year from execution. The note may be converted, in whole or in part, into shares of the Companys common stock. The conversion price will be the lower of 60%, equivalent to a 40% discount, of the lowest trading price of the Companys common stock as of the date of conversion notice or $10.00 per share. For defaults, the note is immediately due and payable and subject to a penalty interest rate of 18%.    As consideration for the holders commitment to purchase this debenture, borrower issued to holder 40 shares of the Companys common stock. These commitment fee shares have been earned in full upon holders purchase of this debenture; none of the commitment fee shares will be returned in the event of prepayment of the note.   On October 14, 2015, the Company paid this note face value in full for cash with accrued interest in the amount of $3,960.  The Company recognized a loss on debt extinguishment in the amount of $30,224. The total payment to this noteholder was $116,684.   Convertible Note dated June 8, 2015   On June 8, 2015, the Company entered into a 12% convertible redeemable note payable with an investor in the amount of $100,000. The gross amount of the note is $100,000, with net proceeds received of $96,500. The $3,500 represents legal fees. This note matures on June 8, 2016. The note will also bear interest at 12%, compounded annually. The maturity date of this note is one year from execution. The note may be converted, in whole or in part, into shares of the Companys common stock. The conversion price will be the lower of closing price of the common stock on the principle market on the training day immediately preceding the closing date or 35%, equivalent to a 65% discount, of the lowest trading price of the Companys common stock during the 20 trading days prior to conversion and the closing sale price of the common stock on the principal market on the trading day immediately preceding the closing date. Under terms of the convertible note agreement, if the closing sale price at any time falls below $5.00, then such 35% figure specified above shall be reduced to 20%, equivalent to an 80% discount.  The stock closing price went below $5.00 per share in the three months ended September 30, 2015.  For defaults, the note is immediately due and payable and subject to a penalty interest rate of 24%.    The note may be prepaid according to the following schedule: Between 1 and 90 days from the date of execution, the note may be prepaid for 120% of face value plus accrued interest. Between 91 and 180 days from the date of execution, the note may be prepaid for 140% of face value plus accrued interest. After 180 days from the date of execution, the note may not be prepaid.   As prescribed in the convertible note agreement, the Company was required to maintain a sufficient number of shares, free from preemptive rights, to provide for the issuance of common stock upon conversion. The Company was required at all times to authorize a reserve of five times the number of shares that are actually issuable upon full conversion of this note. The Company initially instructed the transfer agent to reserve 165,000 shares of common stock for the noteholder for issuance upon conversion.  The noteholder waived the requirement of the reserve shares above and beyond what was needed to convert through the maturity date, notwithstanding the initial reserve amount.  At September 30, 2015 the number of share that were necessary and issuable upon full conversion of then outstanding principal and accrued unpaid interest was 740,943.  The shares needed to convert was based on 20% of the lowest trading price of the Companys common stock as reported on the OTCQB for the twenty prior trading days including the day upon which a notice of conversion is delivered ($0.70.)  Under terms of the convertible note contract, if the closing sale price at any time falls below $5.00, then such 35% figure specified above shall be reduced to 20%, equivalent to an 80% discount.  The stock closing price was below $5.00 per share at June 30, 2016.   On January 4, 2016 the Company issued 166,700 shares of common stock to holder of a convertible note dated June 8, 2015.  The noteholder converted $10,002 of principal only for the shares.  The applicable conversion price was $0.06.  Upon this conversion, the note had a remaining balance including default interest fees of $40,000.    On March 29, 2016, the Company entered into an agreement with this noteholder to amend this convertible note to cure the default clause of the original agreement (no notice of default was provided).  The event of default was due to the Companys inability to reserve sufficient shares required by the convertible note agreement based on the total authorized and unissued shares, which was subsequently cured with the increase of the authorized shares to 8,000,000,000 on March 15, 2016.  The holder agreed to reset the total balance due to the Adjust Current Balance of $40,000.  Also, under the agreement the price of future conversions will be set at $0.10.  The Company was further required to reserve common shares of not less than 400,000. From the date of this agreement, the note shall not be subject to interest.   As of June 30, 2016, the Company has $40,000 outstanding on this note inclusive of accrued default interest fees.   On April 11, 2016 the Company issued 200,000 shares of common stock (of the 400,000) to the noteholder.  The noteholder converted $2,030 of principal only for the shares.  The applicable conversion price was $0.01015. Upon this conversion, the note had a balance of $37,970. Upon the issuance of the remaining 200,000 shares, any applicable loss on conversion will be recorded at that time.    Convertible Note dated June 10, 2015   On June 10, 2015, the Company entered into a 12% convertible redeemable note payable with an investor in the amount of $82,500. The gross amount of the note is $82,500, with net proceeds received of $75,000. The $7,500 represents an Original Issue Discount. This note matures on June 10, 2016. The note will also bear interest at 12%, compounded annually. The maturity date of this note is one year from execution. The note may be converted, in whole or in part, into shares of the Companys common stock. The conversion price will be the lower of 60%, equivalent to a 40% discount, of the lowest trading price of the Companys common stock as of the date of conversion notice or $6.00 per share. For defaults, the note is immediately due and payable and subject to a penalty interest rate of 18%.    The note may be prepaid according to the following schedule: Between 1 and 30 days from the date of execution, the note may be prepaid for 125% of face value plus accrued interest. Between 31 and 180 days from the date of execution, the note may be prepaid for 135% of face value plus accrued interest. After 180 days from the date of execution, the note may be prepaid for 145% of face value plus accrued interest.   Under terms of this agreement, the Company was required to set up an initial reserve of 150,000 common shares of stock for the potential conversion of convertible note principal and interest. This amount was duly reserved with transfer agent. The note holder is permitted under contract to request increases to this reserve of up to five times the number of shares required for the note to be fully converted. No such requests were made of the Company by the noteholder.   As consideration for the holders commitment to purchase this debenture, borrower issued to holder 6,000 shares of the Companys common stock. These commitment fee shares have been earned in full upon holders purchase of this debenture; none of the commitment fee shares will be returned in the event of prepayment of the note.   In December 2015, the noteholder in three (3) separate conversions, converted $47,250 into 600,000 shares of common stock. Two of these note conversions were performed at a price below par value. The result was that $22,500 represented a discount to the common stock (which is reflected net in APIC). After these conversions, the balance outstanding on this note at June 30, 2016 is $123,000 including default total penalties of $138,938 before conversions and payments.   In March 2016, the noteholder in three (3) separate conversions converted $11,188 of principal and accrued fees into 765,000 shares of stock leaving a balance due under this note including interest and fees of $143,000.   On March 25, 2016, the Company entered into an agreement with the noteholder to amend the clauses in the original note agreement.  As a result, the Company was required to pay $20,000 in cash to the noteholder on or before March 31, 2016, which it did, and the noteholder agreed to reset the total balance due to the Adjust Current Balance of $123,000 representing 1,230,000 shares to be issued at $0.10. The Company issued these shares on June 14, 2016.   Convertible Note dated December 23, 2015   On December 23, 2015, the Company entered into a 12% convertible redeemable note payable with an investor in the amount of $72,263. This note matures on December 23, 2016. The note will also bear interest at 12%, compounded annually. The maturity date of this note is one year from execution. Any amount of principal or interest on this note which is not paid when due shall bear an interest rate of 24% per year (default interest.) The note may be converted, in whole or in part, into shares of the Companys common stock. The conversion price will be the lower of 55%, equivalent to a 45% discount, of the lowest trading price of the Companys common stock during the 20 consecutive training days immediately preceding the conversion date and the closing sale price of the common stock on the principal market on the trading day immediately preceding the closing date. If the Company share price at any time loses the bid (ex: 0.0001 on the ask and zero market makers on the bid on level 2), then the conversion price may, in the holders sole and absolute discretion, be reduced to a fixed conversion price of 0.001 (If lower than the conversion price otherwise.)   Under terms of this agreement, the Company was required to set up an initial reserve of 50,000 common shares of stock for the potential conversion of convertible note principal and interest with an additional reserve of 2,450,000 shares of common stock in the name of the holder for issuance upon conversion as soon as a sufficient number of on issued shares become authorized, no later than January 25, 2016. This amount was duly reserved with transfer agent. The Company is required to have authorized and reserved five times the number of shares that are actually issuing a ball upon full conversion of this note.   On March 29, 2016, the Company entered into an agreement with the noteholder to amend this convertible note.  As a result, the Company was required to pay $6,271 in cash to the noteholder on or before March 31, 2016, which it did and the noteholder agreed to reset the total balance due to the Adjust Current Balance of $78,366.  Also, under the agreement the price of future conversions will be set at $0.10.  No shares have been issued to the noteholder subsequent to this agreement.   As of June 30, 2016, the outstanding total of $92,000 including accumulated penalties and interest $19,737 which was restructured as a convertible note with a fixed conversion of $0.10 with 0% annual interest.   Convertible Note dated December 24, 2015   On December 24, 2015, the Company entered into an 11% convertible redeemable note payable with an investor in the amount of $43,000. This note matures on December 24, 2016. The note will also bear interest at 11%, compounded annually. The maturity date of this note is one year from execution. Any amount of principal or interest on this note which is not paid when due shall bear an interest rate of 24% per year (default interest.) OID was recognized on this note in the amount of $18,000. Deducted from the cash proceeds of this note were $10,000 to cover legal and miscellaneous expenses.  $15,000 was paid in cash to the Company.   The note may be converted, in whole or in part, into shares of the Companys common stock. The conversion price will be the lower of 55%, equivalent to a 45% discount, of the lowest trading price of the Companys common stock during the 20 consecutive training days immediately preceding the conversion date and the closing sale price of the common stock on the principal market on the trading day immediately preceding the closing date. If the company share price at any time loses the bid (ex: 0.0001 on the ask and zero market makers on the bid on level 2), then the conversion price may, in the holders sole and absolute discretion, be reduced to a fixed conversion price of 0.001(If lower than the conversion price otherwise.)   If the closing price at any time falls below $0.12 the conversion price will be the lower of 40%, equivalent to a 45% discount, of the lowest trading price of the Companys common stock during the 20 consecutive training days immediately preceding the conversion date and the closing sale price of the common stock on the principal market on the trading day immediately preceding the closing date.   Under terms of this agreement, the Company was required to set up an initial reserve of 2,450,000 common shares of stock for the potential conversion of convertible note principal and interest as soon as a sufficient number of on issued shares become authorized, no later than January 25, 2016.   Under terms of this note, the Company was required to have a sufficient number of shares reserved to allow full conversion as of the test date of January 25, 2016.  This subsequently triggered an event of default, although no formal notice of default was provided and reset the balance to an Adjusted Principal Amount which was defined as double the amount of outstanding principal on the test date.   On March 29, 2016, the Company entered into an agreement with the noteholder to amend this convertible note. As a result, the Company was required to pay $3,729 in cash to the noteholder on or before March 31, 2016, which it did, and the noteholder agreed to reset the total balance due to the Adjust Current Balance of $46,634.  Also, under the agreement the price of future conversions will be set at $0.10.  The Company has not issued any shares under this agreement.   As of June 30, 2016, the amount outstanding under this note was $43,000.   All convertible notes payable are due within one year and are reflected as current liabilities in the condensed consolidated balance sheet at June 30, 2016.   At June 30, 2016, the Company had $0 remaining in discount of the original issue discount with respect to these notes. Amortization of the original issue discount for the six months ended June 30, 2016 and 2015 was $19,829 and $6,958.  Interest expense on the convertible notes for the six months ended June 30, 2016 and 2015 was $21,891 and $177,674, respectively. Accrued interest on these convertible notes for three months ended was six months ended June 30, 2016 was $0.   Derivative Liability - Warrants   In accordance with Financial Accounting Standards Board (FASB) ASC 815, Derivatives and Hedging, the embedded conversion option in the Convertible Note, as well as the Warrants issued by the Company, are required to be accounted for as derivative instrument liabilities. Such liabilities are initially and continuously carried at fair value with changes in their fair value reported in income in each reporting period. Accounting for the conversion option in the Convertible Note and for the Warrants as derivative instruments is required because both the Convertible Note and the Warrants have down-round anti-dilution protection, or ratchet exercise prices, whereby the conversion or exercise price is reduced if the Company subsequently issues common stock, convertible securities or stock options or stock warrants at a lower price or with a lower exercise or conversion price. Such a provision is inconsistent with the fixed for fixed nature of an equity option and therefore the instruments do not meet one of the required tests for equity classification. In addition, because the Convertible Note and the Warrants are denominated in a currency (U.S. dollars) that is different from the Companys functional currency (Canadian dollars), they do not meet the test of being indexed only to the Companys common stock. When one or more instruments are accounted for as derivative liabilities at fair value, the proceeds received are first allocated to the initial fair value of those derivative instruments, with any remaining proceeds allocated to the initial carrying value of the Convertible Note, which is accounted for at amortized cost. Interest is accrued on the initial carrying value of the Convertible Note at whatever effective interest rate is required in order to equate the present value of the expected future cash flows associated with the Convertible Note with their initial carrying value. Stated interest on the Note (10% per annum) is not accrued separately but is included in the effective interest rate on the Convertible Note.   The fair value of the embedded conversion option in the Note and the fair value of the Warrants have been calculated using the call option value output from a binomial Lattice model. A binomial Lattice model assumes that the price of the stock that underlies an option follows a probability distribution in which the underlying event only has one of two possible outcomes - the market price of the stock can either go up or go down in the future.   The Lattice valuation model takes into account all of the assumptions that market participants would likely consider in negotiating the transfer of the embedded conversion option and the Warrants, namely, stock price, exercise price, time to expiration, volatility, risk-free rate and dividends.   The Company between November 26, 2014 and December 31, 2014, repaid the entire convertible note balance of $277,500 thus extinguishing the note. Upon the initial recording of the convertible note and warrants associated with the convertible note, a derivative liability was recorded as the convertible note and warrant each contained embedded derivatives as determined under ASC 815. Since the warrants associated with the convertible note has been exercised there is no outstanding liability as of June 30, 2016.

Preferred Stock   The Company was established on June 2, 2006 with 10,000,000 shares of preferred stock authorized with a par value of $0.001. The Company has not issued any preferred stock.   Common Stock   The Company was established on June 2, 2006 with 100,000,000 shares of common stock authorized with a par value of $0.001. On December 8, 2011, the Company amended the authorized stock to 150,000,000 shares. On March 17, 2014, the Company amended the authorized stock to 500,000,000 shares. On March 15, 2016 the Companys shareholders ratified managements restructuring plan by approving the increase in authorized shares to 8,000,000,000.   On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the company to White Fox Ventures, Inc. (White Fox) to better reflect the new direction of the business and to effect a 100:1 reverse stock split. On May 27, 2016, the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol.   On June 22, 2016, FINRA announced its final approval for the Companys change of name to White Fox Ventures, Inc., as well as a 1:100 Reverse Stock Split and the Companys new Ticker symbol, AWAW, which began trading on July 20, 2016.  All share figures are shown in this report are on a post reverse split basis.     In 2015, the Company issued:   On January 20, 2015 1,500,000 shares were issued in the acquisition of Breathe which was accounted for as reverse merger.   On March 31, 2015 the Company issued 26,667 shares for $100,000 in an investment into Tauriga Sciences, Inc. (TAUG). The Company entered into a commercialization/license agreement with TAUG to jointly develop a new line of business involving CBD oil cartridges in on March 31, 2015. The Company received from TAUG 10,869,565 shares of TAUG common stock (with a value of $100,000) in exchange for their shares (reflected as an investment). Due to the very low stock value of both companies and with the Company exiting the eCigarette business both companies have impaired their respective investment to $0 as December 31, 2015.   On May 10, 2015 the Company issued a supplier 7,500 shares of common stock at a value of $22,500 for the payment of inventory ($3.00 per share) and 3,000 shares of common stock valued at $9,000 ($3.00 per share) to a former noteholder ("Iconic") as part of an Assignment and Assumption Agreement dated May 7, 2015.   269,839 common shares were issued for cash in the amount of $1,047,270 at an average share price of $3.90.   718,588 shares of common stock for consulting services rendered and to be rendered accrued as of December 31, 2015 in the amount of $5,547,305 including the cost of 65,000 shares to be issued ($7.70 per share) including an agreement with Maxim Group LLC ("Maxim") to provide general financial advisory and investment banking services in exchange for 2.5% of the then issued and outstanding stock at the date of execution. The number of shares of common stock issued and outstanding at the time of this agreement was 2,763,527. At that date 2.5% of the issued and outstanding common stock equaled 69,088 shares. The Company, on May 18, 2015 canceled shares in the amount of 31,500 shares due to services never provided at a value of $157,500 ($5.00 per share).   850,743 common shares were issued for the conversion of principal and accrued interest by the holders of convertible notes at a value of $406,385 having and average share price of $0.50 at conversion.   171,500 common shares of stock to noteholders as commitment and assignment shares and recorded as debt financing cost at a value of $176,050 (average price $1.00.)   Under the first tranche of a July 2, 2015 securities purchase agreement, $240,000 was committed for purchase of common stock and warrants.  Cash was received associated with this offering was $233,500, with $6,500 credited to the purchaser for legal fees.  Under the second tranche of this agreement the amount to be funded will be $200,000. Second tranche closing date was to be a trading date no later than five (5) Business Days following the effective date of the Registration Statement. on which all of the transaction documents have been executed and delivered by the applicable parties thereto, and all conditions precedent to (i) the Purchasers obligations to pay the Subscription Amount for the Second Tranche and (ii) the Companys obligations.  The Company filed Form S-1 Registration Statement Under the Securities Act of 1933 (S1) on August 17, 2015.   On October 2, 2015 the Company pursuant to Rule 477 promulgated under the Securities Act of 1933, as amended (the Securities Act) submitted a request for withdrawal of the previously filed S-1.     Under this agreement, the Company was obligated to issue 40,000 common shares of its stock at $6.00 per share subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the common stock that occur after the date of agreement.  Final purchase price is subject to adjustment based on the closing price of the common stock on first adjustment date that is six (6) months immediately following the closing date (or if such date is not a trading day, the trading day immediately preceding such six (6) month period).  Final purchase price is also subject to adjustment based on the second adjustment date based on the closing price of the common stock on thirty (30) days following the first adjustment date (or if such date is not a trading day, the Trading Day immediately preceding such date).   Under the agreement, at any time while warrants are outstanding, if the Company sold or grants any option to purchase, or sell or any common stock or common stock equivalents, at an effective price per share less than the exercise price then in effect but greater than $10.00 (price adjusted) will be considered a dilutive issuance and the holder of the warrant will be entitled to receive shares of common stock at an effective price per share that is less than the exercise price.   Cashless warrants registered in the name of such purchaser to purchase up to a number of shares of common stock equal to 100% of such purchaser shares for the first tranche, with an exercise price equal to $20.00, subject to adjustments whereby the Company may issue without further consideration.  In the event that the first adjusted price is higher than the per-share purchase price but lower than $8.00 per share, 10% of the aggregate number of shares issued or issuable or 15% if equal to or lower than the per-share price.  The Company must file Form S-1 with the SEC under terms of this agreement.   Under this agreement, the Company reserved 250,000 shares of common stock to provide for the issuance of common shares, the adjustment shares and warrant shares.  In the event that the companys stock falls below $4.00 per share for three consecutive training days, the Company will immediately add an additional 150,000 shares to this reserve. In the event that the stock falls below $2.00 per share the three consecutive trading days the Company will immediately add an additional 200,000 shares of the reserve.   On August 25, 2015, the Company consented to an assignment agreement whereby the assignor received $265,000 cash in exchange for the transfer of rights pursuant to the securities purchase agreement dated July 2, 2015.  As part of this agreement, the Company directly paid to assignee $180,000 in exchange for the assignee waiving all rights under the original agreement related to price adjustments, second tranche issuance and warrants.   On September 8, 2015 the cashless warrants to purchase 6,906 common shares were exercised to convert to 75,415 common shares based on a price reset to equal the conversion price associated with the debt agreements from the stated strike price of $75.00. The price reset which resulted in the conversion to 75,415 common shares based on the difference between the current market value (market price of $25.00 multiplied by exercise shares of 6,906) and the exercise price ($3.75) multiplied by number of exercise shares (6,906.) This number is then divided by the adjusted price of the common stock ($1.946.)   As of December 31, 2015, the Company has 4,708,113 shares of common stock issued and outstanding.  As of December 31, 2015 the Company had a liability for stock of $82,710 for stock to be issued as conversion shares under the note settlement agreement of the March 13, 2015 8% convertible note.  Share are to be issued in three issuances of 5,000 each not to have a value less than $5,000 each.  Issuances are scheduled November 1, 2015; December 1, 2015 and January 1, 2015. The Company reversed liability for stock issuable under a distribution agreement in the amount of 50,000 common shares which had a value of $37,500 ($0.75 per share) due to that agreement no longer being in effect.  The Company further has a liability for stock to be issued under a consulting agreement to issue 14,000 shares in the amount of $17,710 ($1.30 per share.) These shares do not include the shares owed to the noteholders as described in NOTE 5. The liability for those shares is included with the note payable balances.   The Company initiated payments in the amount of $180,000 to buy back price adjustment rights, warrants and additional issuance rights transferred to assignee under original stock purchase agreement dated July 2, 2015. The Company has the 40,000 share stock certificate in its possession pending the stock reissuance to a new certificate to assignee.   In 2016, the Company issued:   In the six months ended June 30, 2016, the Company issued 1,131,700 shares of common stock to holders of convertible notes dated.  The noteholders converted $146,220 of principal and interest for the shares.  The applicable conversion prices ranged from $0.01 to $0.10 per share.     In the six months ended June 30, 2016, the Company issued 858,326 shares of common stock to Giovanni  and Peter Comito and their affiliates pursuant to the Comprehensive Settlement Agreement entered into on March 9, 2016 to convert $1,050,000 in notes payable and acquire the intellectual property of the Company.   In the six months ended June 30, 2016, the Company issued 550,000 common shares to a related party for the settlement of payments made on behalf of the Company.  The Company recognized a loss on debt conversion for the amount in excess of the closing stock price on the day of issuance over the value of the liabilities settled in the amount of $12,500 (550,000 shares at $0.10.)   In the six months ended June 30, 2016, the Company issued 29,750,700 shares of common stock to Company board members and officers and other investors, who had invested $364,273 in the Company in the form of payment of various settlements and invoices outstanding. These investments were treated as a private placement with prices ranging from $0.01 to $0.18 per share.   On April 15, 2016, the Company issued 500,000 common shares pursuant to a settlement agreement entered into on March 30, 2016, concerning trademark litigation with plaintiff, Breathe LLC (a Florida organization.) Share issuance to be recorded at the closing price of the stock as of the day the Company entered into the settlement agreement in the amount of $50,000 ($0.10 per share.)   On June 17, 2016, the Company issued 97,000 common shares in exchange for May 18, 2016 payments of certain expenses related to the corporate filings in the amount of $47,000 and the funding of an investment in the amount of $50,000 in the common stock of a privately held company, Kudzoo, Inc. representing less than 2% of that company as an investment. This investment will be recorded at cost on the Companys balance sheet.   Authorized Reserved Shares   Under terms of several of the Companys convertible notes it was required under those note agreements at all times to authorize and reserve four and in some cases five times the number of shares that are actually issuable upon full conversion of said notes (based on the conversion price of the notes in effect from time to time.)  The noteholders waived the requirement of the reserve shares above and beyond what was needed to convert through the maturity date, notwithstanding the initial reserve amount. The Company is required to make proper provisions so that there after there shall be a sufficient number of shares of common stock authorized and reserved, free from preemptive rights.  The Company is further obligated to make any changes to its capital structure which would change the number shares of common stock into which said notes shall be convertible at the then current conversion price. Based on this calculation, the Company did not have sufficient authorized common shares to convert all convertible notes, and exercise all outstanding warrants from the unissued common shares as of December 31, 2015, however, cured any deficiency related to these provisions on March 15, 2016, upon the approval of the DEF 14A and amendments to the Certificates of Incorporation. As noted herein, the noteholders waived this requirement to the Company as they knew the Company was amending their charter to increase the authorized number of common shares to accommodate any conversions.   Stock Options   On August 12, 2013, the Company approved and enacted the 2013 Stock Incentive Plan (the Plan). Under the 2013 Stock Incentive Plan, the Company may grant options or share awards to its full-time employees, executive officers, directors and consultants up to a maximum of 8,000,000 common shares. Under the Plan, the exercise price of each option has been established at $25.00. Stock options vest as stipulated in the stock option agreement and their maximum term is 8 years.   The following table summarizes information about the Companys stock options:   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center">June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center">December 31, 2015</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Number of</td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">exercise</td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Number of</td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">exercise</td> <td> </td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">options</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">Price</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">options</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">price</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 52%">Options outstanding, beginning of period</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">-</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right">$</td> <td style="width: 9%; text-align: right">-</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 9%; text-align: center">   2,000</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right">$</td> <td style="width: 9%; text-align: center">          25.00</td> <td style="width: 1%; text-align: right"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Granted</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Exercised</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Forfeited</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">Expired</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">   (2,000)</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(25.00)</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 3pt">Options outstanding, end of period</td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double">                 -</td> <td style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td style="padding-bottom: 3pt"> </td></tr> </table>   Under the Plan, the exercise price of each option has been established at $25.00. Stock options vest as stipulated in the stock option agreement and their maximum term is 8 years. In the year ended December 31, 2015 the last of these options expired. There are no outstanding options as of June 30, 2016.   Stock options-based compensation expense included in the condensed consolidated statements of operations and comprehensive loss for the six months ended June 30, 2016 and 2015 was $0.   Warrants   The following table summarizes the Companys share warrants outstanding as of June 30, 2016 and December 31, 2015:   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center">June 30, 2016</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center">December 31, 2015</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Average</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Number of</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">remaining</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Exercise</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Number of</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">remaining</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">exercise</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">warrants</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">life (years)</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">Price</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">warrants</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">life (years)</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">price</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 28%">Warrants outstanding, beginning of year</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">-</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">-</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">-</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">15,406</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">1.5</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">66.00</td> <td nowrap="nowrap" style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Granted</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Exercised</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(6,906 </td> <td nowrap="nowrap">) </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt">Expired</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(8.500 </td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">) </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 3pt">Warrants outstanding, end of year</td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt"> </td> <td style="border-bottom: black 2.25pt double">$</td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double">$</td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td></tr> </table>   On September 8, 2015 the cashless warrants to purchase 6,906 common shares were exercised to convert to 75,415 common shares based on a price reset to equal the conversion price associated with the debt agreements from the stated strike price of $75.00. The price reset which resulted in the conversion to 75,415 common shares based on the difference between the current market value (market price of $25.00 multiplied by exercise shares of 6,906) and the exercise price ($3.75) multiplied by number of exercise shares (6,906.) This number is then divided by the adjusted price of the common stock ($1.946.)   On August 12, 2013, the Company approved and enacted the 2013 Stock Incentive Plan (the Plan). Under the 2013 Stock Incentive Plan, the Company may grant options or share awards to its full-time employees, executive officers, directors and consultants up to a maximum of 80,000 common shares. Under the Plan, the exercise price of each option has been established at $25.00. Stock options vest as stipulated in the stock option agreement and their maximum term is 8 years. 8,500 options were issued in 2013 which expired in 2015. As of June 30, 2016, there are no warrants outstanding.

On March 31, 2015, the Company and TAUG entered into a non-exclusive license agreement, whereby TAUG will provide CBD oil cartridges to be used in the Breathe eCigs Corp. e-cigarette.  In accordance with the agreement, TAUG was to receive a royalty of 50% of the net revenues associated with the sale of specified list of products listed in the agreement.  In addition, there was a share swap between TAUG and the Company to equate to $100,000.  The Company issued 26,667 shares at $3.75 for the commercialization of the products.  TAUG issued 10,869,565 shares of its stock to acquire the license agreement (investment).   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; text-align: center">Description</td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">Amount</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 89%; padding-bottom: 1.5pt">Stock issued</td> <td style="width: 1%; padding-bottom: 1.5pt; text-align: right"> </td> <td style="width: 1%; border-bottom: black 1.5pt solid">$</td> <td style="width: 8%; border-bottom: black 1.5pt solid; text-align: right">100,000</td> <td style="width: 1%; padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">Total</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">100,000</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt">Less: Management impairment valuation</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">100,000</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 3pt">Net June 30, 2016 and December 31, 2015 balances</td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double">$</td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td style="padding-bottom: 3pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Issued 26,667 shares of Company common stock</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">26,667</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>at $1.00 per share.</td> <td style="text-align: right"> </td> <td>$</td> <td style="text-align: right">3.75</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Share value</td> <td> </td> <td>$</td> <td style="text-align: right">100,000</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt">Less: Management impairment valuation</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">100,000</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 3pt">Net June 30, 2016 and December 31, 2015 balances</td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double">$</td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td style="padding-bottom: 3pt"> </td></tr> </table>   At March 30, 2016 it was determined by management of both companies that the value of the investment based on stock value and no business venture will be pursued was valueless. Therefore, the entire investment and commercialization fees recorded were written off completely.

On August 24, 2015, the Company, received funds from 3476863 Canada Inc. (Peter Comito) in the amount of $50,000 under a Stock Purchase Agreement.  The Company intended to convert these funds into equity through the issuance of common shares of stock.  On March 28, 2016, the Company issued common shares under a settlement agreement to satisfy this obligation.   On September 22, 2015, Giovanni Comito purchased 104,000 shares of the Companys common stock, par value $0.10, from Joshua Kimmel, the Companys Chief Executive Officer, Chief Financial Officer and member of the Board of Directors, for an aggregate purchase price of $75,000.  All such shares were restricted securities at the time of the purchase and will continue to be restricted securities as such term is defined under Rule 144 of the Securities Act of 1933, as amended.   On September 22, 2015, the Company issued an unsecured promissory note to Kimmel in consideration for gross proceeds to the Company of $75,000 (for which constitutes all proceeds received by Kimmel as part of the Comito Purchase).  The Kimmel Note accrues interest at 4.5% per annum unless there is an event of default, in which case the interest rate increases to 9.0% per annum.  The entire principal amount and all accrued but unpaid interest under the Kimmel Note will be due and payable by the Company no later than September 22, 2016.  As of June 30, 2016, accrued interest was $2,552.   On September 30, 2015, the Company, issued an unsecured promissory note to Giovanni Comito in consideration for gross proceeds to the Company of $400,000 pursuant to a letter of intent (LOI) purchase agreement for the sale of intellectual property held by the Company.  The Giovanni Comito Note accrues interest at 4.5% per annum unless there is an event of default in which case the interest rate increases to 9.0% per annum.  The entire principal amount and all accrued but unpaid interest under the Giovanni Comito Note will be due and payable by the Company no later than March 31, 2016.  On March 28, 2016 this obligation was satisfied with the collective issuance of 858,326 to settle a total of $1,050,000 related party notes related to the purchase of the Companys intellectual property.   During the three months ended December 31, 2015 the Company, issued nine unsecured promissory note to Peter Comito and affiliate companies in consideration for gross proceeds to the Company of $500,000 pursuant to the LOI.  The Note accrues interest at 4.5% per annum unless there is an event of default in which case the interest rate increases to 9.0% per annum.  The entire principal amount and all accrued but unpaid interest under the Notes will be due and payable by the Company no later than six months after issuance.  On March 28, 2016 this obligation was satisfied with the collective issuance of 858,326 to settle a total of $1,050,000 related party notes related to the purchase of the Companys intellectual property.   On October 28, 2015, the Company, issued an unsecured promissory note to 9138-1095 Quebec Inc. (Angelo Chiapetta) in consideration for gross proceeds to the Company of $50,000 pursuant to the LOI.  The 9138-1095 Quebec Inc. (Angelo Chiapetta) Note accrues interest at 4.5% per annum unless there is an event of default in which case the interest rate increases to 9.0% per annum.  The entire principal amount and all accrued but unpaid interest under the 9138-1095 Quebec Inc. (Angelo Chiapetta) will be due and payable by the Company no later than April 28, 2016.  On March 28, 2016 this obligation was satisfied with the collective issuance of 858,326 to settle a total of $1,050,000 related party notes related to the purchase of the Companys intellectual property.   On November 4, 2015, the Company, issued an unsecured promissory note to 7091061 Canada Inc. (Carmine D'Argenio) in consideration for gross proceeds to the Company of $50,000 pursuant to the LOI.  The 7091061 Canada Inc. (Carmine D'Argenio) Note accrues interest at 4.5% per annum unless there is an event of default in which case the interest rate increases to 9.0% per annum.  The entire principal amount and all accrued but unpaid interest under the 7091061 Canada Inc. (Carmine D'Argenio) will be due and payable by the Company no later than May 4, 2016.  On March 28, 2016 this obligation was satisfied with the collective issuance of 858,326 to settle a total of $1,050,000 related party notes related to the purchase of the Companys intellectual property.     During the three months ended March 31, 2016 a related party paid expenses and debt on behalf of the Company in the amount of $42,500 which was agreed to be settled for 550,000 shares of Company stock, issued April 4, 2016.   During the six months ended June 30, 2016 related parties funded obligations of the Company in the amount of $437,584.  This amount as of July 31, 2016, was $438,574. The Company issued 22,184,700 shares of common stock to settle these obligations through July 31, 2016, with $3,000 still due.

As of June 30, 2016, there is no provision for income taxes, current or deferred.   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 89%">Net operating losses carryforward</td> <td style="width: 1%"> </td> <td style="width: 1%">$</td> <td style="width: 8%; text-align: right; text-indent: 0.5in">                     3,312,367</td> <td style="width: 1%; text-align: right"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt">Valuation allowance</td> <td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">                    (3,312,367</td> <td style="padding-bottom: 1.5pt">)</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt"> </td> <td style="border-bottom: black 2.25pt double">$</td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td style="padding-bottom: 3pt"> </td></tr> </table>   The Company has approximately $9,742,000 in net operating losses as of June 30, 2016 available to offset future taxable income through 2036. The Company has established a valuation allowance equal to the full amount of the deferred tax assets due to the uncertainty of the utilization of the operating losses in future periods.   A reconciliation of the Companys effective tax rate as a percentage of income before taxes and the statutory rate for year ended June 30, 2016 is summarized below:   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 89%">Federal rate</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: right">34 </td> <td nowrap="nowrap" style="width: 1%">%</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt">State rate</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt">Combined Tax Rate</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">34 </td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">%</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 3pt">Valuation allowance</td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">(34 </td> <td nowrap="nowrap" style="padding-bottom: 3pt">)%</td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: top"> <td style="width: 22%"> </td> <td style="width: 78%"> </td></tr> </table>

The Company had the following financial commitments, represented by lease agreements, as of June 30 2016,   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">Year ending December 31,</td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">Total</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">Future Obilgation</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 78%; text-align: right">2016</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: right">43,537.58</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: right">46,825</td> <td nowrap="nowrap" style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: right">2017</td> <td> </td> <td> </td> <td style="text-align: right">99,815.16</td> <td nowrap="nowrap"> </td> <td> </td> <td> </td> <td style="text-align: right">103,102</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: right">2018</td> <td> </td> <td> </td> <td style="text-align: right">56,911.90</td> <td nowrap="nowrap"> </td> <td> </td> <td> </td> <td style="text-align: right">58,281</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt"> </td> <td> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">208,208</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td></tr> </table>   Rent expense for the three and six months ended June 30, 2016 was $3,561 and $7,122 compared to $1,187 and $1,187 for the same period in the prior year.  All rental amounts are presented in discontinued operations.   On March 15, 2015 the Company entered into a 38-month lease agreement for office space 322 Nancy Lane, Suite 7, Knoxville, Tennessee.   This office was the former operational headquarters for the Company.  The Company is currently working with the landlord to find another tenant for this space and remove this obligation.   On April 25, 2016 the Company entered into a lease agreement for virtual office space on New York City, New York to conduct Company business and investor relations.  Rent payments commenced on May 1, 2016.  Total commitment is $2,790 with expiration of April 30, 2016.   On June 20, 2016, White Fox Japan LLC, the Companys majority owned subsidiary entered into an approximately two-year lease for office space.  The lease will commence on August 1, 2016, expiring June 19, 2018.  Rent is fixed over the lease period at $7,300 per month.   Trademark dispute   On August 5, 2015, the Company received a notice from Breathe, LLC, a Florida limited liability company (Breathe LLC), that the Company was violating Breathe LLCs trademark rights under U.S. Trademark Registration No. 4,633,887 for the name Breathe filed on September 27, 2013 and a demand for the Company to immediately cease and desist from such use.  The Company believes that it has rights of prior use to the name Breathe under the federal trademark laws.  As such, on August 10, 2015, the Company filed (i) a Petition for Cancellation with the United States Patent and Trademark Office regarding U.S. Trademark Registration No. 4,633,887 and (ii) a Complaint against Breathe LLC in the United States District Court of Eastern District of Tennessee (the "Tennessee Court"), Civil Action No. 3:15-cv-00345 requesting a declaratory judgment regarding the Companys rights to use the trademark.  A default judgment is currently pending in the Tennessee Court against Breathe LLC for failure to respond to the Tennessee Court complaint.  Breathe LLC has requested the default judgment not be entered and that it be given an extension of time to respond.  The Tennessee Court has not ruled on Breathe LLCs request as of the date of the filing of this Form 10-Q.  On August 16, 2015, the Company was notified that on August 12, 2015 Breathe LLC filed a Complaint in the United States Southern District Court of New York (the New York Court), Civil Action N. 1:15-cv-06403, against the Company and its Chief Executive Officer, Joshua Kimmel, demanding, among other things, damages of $5,000,000 and an injunction restraining the Company from using the name Breathe.  On November 8, 2015, the New York Court held a hearing regarding Breathe LLCs request for a preliminary injunction.  On the same day, the New York Court entered an order denying Breathe LLCs request for a preliminary injunction finding "uncontroverted evidence showing that Kimmel began distributing, promoting and advertising electronic cigarettes with the "Breathe" mark prior to September 27, 2013".  Despite the New York Courts denial, the overall litigation continues.  Although the Company believes it will prevail on the merits, there can be no guaranty that it will do so.  If the Company is unable to prevail, it may be required to market its products under a different name.   As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company will pay two cash payments ($10,000 immediately and $15,000 was originally due by July 31, 2016 and was paid August 10, 2016.)  The Company is also required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. The Company further agrees to split 50/50 any future sales of its held inventory.  The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.   On April 15, 2016 the Company issued 500,000 shares of common stock pursuant to this agreement to be recorded at the closing price of the stock as of the day the Company entered into the settlement agreement in the amount of $50,000 (at par value.)   As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

Corporate Matters   Effective July 18, 2016, the Company has dismissed KBL LLP (the Former Accounting Firm) as its independent registered public accounting firm.  Effective July 18, 2016, the Company has engaged Pritchett Siler & Hardy, PC Certified Public Accountants of 515 South 400 East, Suite 100 Salt Lake City, Utah (the New Accounting Firm) as its new independent registered public accounting firm as of and for the quarter ending June 30, 2016.  The change in independent registered public accounting firm is not the result of any disagreement with the Former Accounting Firm.   On July 20, 2016 the Company began trading under its new ticker symbol, AWAW.   Effective August 13, 2016, Seth Shaw resigned from the Company as Chief Financial Officer and Director. The Company has agreed to buy back 3,200,000 shares issued to him as reimbursement for expenses which he paid personally. The Company will buy back the shares at a price of $0.01 for a total value of $32,000. Mr. Takehiro Abe will be appointed CFO upon Mr. Shaws departure.   Notes Payable   On August 9, 2016, the Company entered into a 12-month non-convertible note with a related party in the amount of the $25,000 bearing an interest rate of 8%.  The note matures on August 9, 2017. If the note defaults, the lender at its deaccession may convert principal and accrued interest into common stock at a value of $0.01 per share.   Stock Issuances   On July 19, 2016, the Company issued 1,450,000 common shares to the holder of three convertible notes for the conversion of remaining principal.

These consolidated financial statements are prepared in conformity with United States generally accepted accounting principles (U.S. GAAP) and are presented in U.S. dollars.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates include but are not limited to stock-based compensation and tax valuation allowances.

The condensed consolidated financial statements included the accounts of the Company and Breathe as the acquisition of Breathe was accounted for as a reverse merger and Breathe is the accounting acquirer, from the date that the Merger occurred between the Company and Breathe eCigs Corp. All intercompany transactions and accounts had been eliminated on consolidation. Effective March 11, 2015, the financial statements were no longer consolidated until April 2015 and the establishment of two new wholly-owned subsidiaries, which are inactive.   On June 17, 2016, the Company formed a subsidiary with 99% majority ownership stake.  The subsidiary, White Fox Japan LLC, will be presented with a non-controlling interest of 1% for the share owned by related party, Company Chief Operating Officer and Director, Takehiro Abe.  The subsidiary will conduct all transactional operational activity of the Company.  The subsidiary will plan, manage and promote seminars and classes in Japan. The subsidiary has a fiscal year ended April 30, 2017.  As of June 30, 2016 there was no activity in the subsidiary.

On January 16, 2015, Breathe entered the Exchange Agreement with the Company, whereby the Company acquired all of the issued and outstanding shares of common stock of Breathe in consideration for the issuance of 1,500,000 shares of common stock. This business combination was accounted for as a reverse merger whereby Breathe is the accounting acquirer as the former Breathe shareholders then controlled greater than 50% of the voting control of the Company.   In November 2014, the FASB issued ASU No. 2014-17, Business Combination. The provisions of ASU No. 2014-17 require management to determining whether and at what threshold an acquiree (acquired entity) can reflect the acquirers accounting and reporting basis (pushdown accounting) in its separate financial statements. The entities of the transaction were under common control from January 16, 2015 until February 3, 2015. Since neither unit of this business combination is in the development stage, nor had recognizable revenues during this period the application of push down accounting would not be of significant value to the readers of these condensed consolidated financial statements. The Company has not elected to apply pushdown accounting in its separate financial statements upon occurrence of this event.

The Company estimates the fair value of stock based payment awards made to officers and directors related to the Companys stock incentive plan, on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense ratably over the requisite service periods. The Company uses the Black-Scholes option pricing model to determine the fair value of the stock-based compensation that it grants to officers and directors. The Company is required to make certain assumptions in connection with this determination, the most important of which involves the calculation of volatility with respect to the price of its common stock. The computation of volatility is intended to produce a volatility value that is representative of the Companys expectations about the future volatility of the price of its common stock over an expected term. Shares of the Company commenced trading on August 22, 2013. As a result, the volatility value that the Company calculated may differ from the future volatility of the price of its shares of common stock.   Upon the exercise of stock options, any consideration received and the amounts previously recorded under stock-based compensation are credited to share capital. Upon the issuance of shares resulting from share awards, amounts previously recorded under stock based compensation are credited to share capital.

The Company adopted ASC 220-10, Reporting Comprehensive Income, (formerly SFAS No. 130). ASC 220-10 requires the reporting of comprehensive income in addition to net income from operations.   Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of information that historically has not been recognized in the calculation of net income.

The Company considers all highly liquid debt instruments and other short-term investments with maturity of three months or less, when purchased, to be cash equivalents.   At June 30, 2016 the Company did not maintain cash or cash equivalent balances at any major United States bank.

The Company uses the liability method of accounting for income taxes under which deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as part of the provision for income taxes in the period that includes the enactment date. Deferred tax liabilities are always provided for in full. Deferred tax assets are recognized to the extent that it is probable that they will be able to be utilized against future taxable income. Deferred tax assets and liabilities are offset only when the Company has a right and intention to set off current tax assets and liabilities from the same taxation authority. Valuation allowances are established, when necessary, to reduce deferred tax assets to amounts that are expected to be realized.   The Company accounts for income taxes pursuant to the provision of ASC 740-10, Accounting for Income Taxes (ASC 740-10) which requires, among other things, an asset and liability approach to calculating deferred income taxes. The asset and liability approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. A valuation allowance is provided to offset any net deferred tax assets for which management believes it is more likely than not that the net deferred asset will not be realized.   The Company follows the provision of ASC 740-10 related to Accounting for Uncertain Income Tax Position. When tax returns are filed, there may be uncertainty about the merits of positions taken or the amount of the position that would be ultimately sustained.   In accordance with the guidance of ASC 740-10, the benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions.   Tax positions that meet the more likely than not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above should be reflected as a liability for uncertain tax benefits in the accompanying balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. The Company believes its tax positions are all highly certain of being upheld upon examination. As such, the Company has not recorded a liability for uncertain tax benefits.   The Company has adopted ASC 740-10-25, Definition of Settlement, which provides guidance on how an entity should determine whether a tax position is effectively settled for the purposes of recognizing previously unrecognized tax benefits and provides that a tax position can be effectively settled upon the completion and examination by a taxing authority without being legally extinguished. For tax positions considered effectively settled, an entity would recognize the full amount of tax benefit, even if the tax position is not considered more likely than not to be sustained based solely on the basis of its technical merits and the statute of limitations remains open. The federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities generally for three years after they were filed.

The Company recognizes revenues from the sale of the Companys products when the following criteria are met: (i) persuasive evidence of an arrangement exists; (ii) delivery has occurred; (iii) the price to the customer is fixed or determinable; and (iv) collection of the sales price is reasonably assured.  Delivery occurs when goods are shipped and title and risk of loss have passed to the customer.  Revenue is deferred in all instances where the earnings process is incomplete.  Payments received before all of the relevant criteria for revenue recognition are satisfied will be recorded as deferred revenue.  Revenues and costs of revenues from consulting contracts will be recognized during the period in which the service will be performed.  All revenues will be reported net of any sales discounts or taxes. Any revenues generated are included in discontinued operations.

The Company was engaged up until March 30, 2016 in the sales and distribution in the consumer products market through sales to distributors, wholesalers and direct to consumers via e-commerce sales of eCigarettes for use by consumers.  Trade receivables consisted primarily of amounts due to the Company from their normal business activities whereby approved distributors and wholesalers are extended terms after down payments on orders. The Company controlled credit risk related to the trade receivables through credit approvals, credit limits and monitoring procedures, and perform ongoing credit evaluations of the customers. In assessing the carrying value of its trade receivables, the Company estimated the recoverability by making assumptions based on factors such as current overall and industry-specific economic conditions, historical and anticipated customer performance, historical write-off and collection experience, the level of past-due amounts, and specific risks identified in the accounts receivable portfolio. Additional changes to the allowance could be necessary in the future if a customers creditworthiness deteriorates, or if actual defaults are higher than the Companys historical experience. Any difference could result in an increase or decrease in the allowance for doubtful accounts. All accounts receivable, net of an allowance are considered assets from discontinued operations.

Finished Goods Inventory - Finished goods inventory is stated at the lower of cost or market determined by the first-in, first-out method, and include salable eCigarette product items and supplies that are sale ready to ship to consumers, wholesalers or distributers. Shipping and handling costs (consisting of all costs to warehouse, pick, pack and deliver inventory to customers) will be included in cost of goods sold. Samples are included in marketing expenses which are a component of general and administrative costs. The Company in March 2015 entered into Distribution Agreements with various distributors for the distribution of the Companys products. The Company placed an initial order for merchandise in the amount of $437,750 on March 27, 2015. The Company has outsourced the assembly and production of its products held for resale and will not hold any of the product in its possession. The Companys inventory is received, housed and distributed by a third party fulfillment provider. As of June 30, 2016, the inventory held by the third party fulfillment provider had a value of $227,685.   As of March 30, 2016, pursuant to a settlement agreement under trademark litigation, the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company is required to pay two cash payments ($10,000 was paid on March 31, 2016 and $15,000 originally due by July 31, 2016 and was paid on August 10, 2016.)  Under this agreement, the Company is required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.   As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.   As a result of the settlement agreement and the resultant discontinuance of this operation, management feels that it could sell the current inventory at $.50 for each $1 of inventory therefore an allowance has been recorded to recognize the current expected net realizable value of the on-hand inventory in the amount of $113,843.  This amount is reflected in assets from discontinued operations.

Basic net loss per share (Basic EPS) is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding for the period.   Diluted earnings per share is computed by dividing adjusted net income available to common shareholders by the weighted average number of common shares outstanding adjusted for the effects of all dilutive common share issuances.   Dilutive common share issuances shall be deemed to have been converted into ordinary shares at the beginning of the period.   For the purpose of calculating diluted earnings per share, the Company shall assume the exercise of dilutive stock options and warrants, as well as shares reserved for the conversion of certain notes payable. The assumed proceeds from these instruments shall be regarded as having been received from the issue of common shares at the average market price of common shares during the period. Dilutive common share issuances are not included in the computation of diluted earnings per share when the Company reports a loss because to do so would be anti-dilutive for the periods presented.

The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.   The accounting treatment of derivative financial instruments may require that the Company for various instruments record the conversion option and related warrants at their fair values as of the inception date of the agreements, and at fair value as of each subsequent balance sheet date, should the characteristics of these instruments warrant the need to record the derivative liability.   During the year ended December 31, 2014, as a result of entering into the convertible notes, the Company was required to classify certain non-employee warrants as derivative liabilities and record them at their fair values at each balance sheet date. Any change in fair value was recorded as a change in the fair value of derivative liabilities for each reporting period at each balance sheet date. The Company reassessed the classification at each balance sheet date. If the classification changed as a result of events during the period, the contract was reclassified as of the date of the event that caused the reclassification.   The fair value of conversion options at a fixed number of shares are recorded using the intrinsic value method. Conversion options at variable rates and any options and warrants with ratchet provisions are deemed to contain a down-round protection. Accordingly, they do not meet the scope exception for treatment as a derivative under ASC 815 since down-round protection is not an input into the calculation of the fair value of the equity instruments and cannot be considered indexed to the Companys own stock, which is a for the scope exception as outlined under ASC 815.   The Company signed convertible notes and warrants and has determined that a conversion option is embedded in the note and it is required to bifurcate the conversion option from the host contract under ASC 815 and account for the derivatives at fair value. The estimated fair value of the conversion option was determined using the binomial model. The fair value of the conversion option was classified as a liability until the debt was converted by the note holders or paid back by the Company. The fair value was affected by changes in inputs to that model including the stock price, expected stock price volatility, the contractual term, and the risk-free interest rate. The Company continued to classify the fair value of the conversion option as a liability until the conversion option was exercised, expired or amended in a way that would no longer require these conversion options to be classified as a liability, whichever comes first. The Company has adopted a sequencing policy that reclassifies contracts (from equity to assets or liabilities) with the most recent inception date first. Thus any available shares are allocated first to contracts with the most recent inception date.   For the binomial lattice options pricing model, the Company used the following assumptions and weighted average fair value ranges as at the transaction date, April 28, 2014, and for the period ended June 30, 2016:   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">Convertible Notes:</td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> April 28, 2014</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 78%">Risk free interest rate</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">0.0577%</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">N/A</td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Dividend yield</td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Volatility</td> <td> </td> <td> </td> <td style="text-align: center">86.31%</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">Warrants:</td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> April 28, 2014</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 78%">Risk free interest rate</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">0.144%</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">N/A</td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Dividend yield</td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Volatility</td> <td> </td> <td> </td> <td style="text-align: center">97.33%</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> </table>   The Company had repaid the debt associated with the derivative liability in December 2014, however carried the warrants through the conversion of those warrants in September 2015. As a result of the conversion of the warrants, the entire derivative liability was extinguished as of September 30, 2015. The Company has no other instruments that contain embedded derivatives.   Prior to the effective date of the DEF 14A (March 15, 2016) which included the amendment to the Certificate of Incorporation increasing the authorized common shares of the Company from 500,000,000 to 8,000,000,000 shares, the Company did not have sufficient authorized shares to effectuate any conversion of convertible notes outstanding with either of the two noteholders. The Company remained in constant negotiations with the noteholders resulting in amended agreements dated March 25, 2016 and March 29, 2016, respectively, and the noteholders did not exercise their right to issue the Company a notice of default. At no time, did the Company consider that the notes outstanding could not be fully settled, with the DEF 14A progressing towards effectiveness. As the 14A was effective, prior to the issuance of this report, the Company in effect, cured any default under the note agreements, and as a result, no derivative liability was recorded by the Company. The amended note agreements reflect the current number of common shares needed to settle the remaining convertible note agreements and there are sufficient shares available to settle these agreements.

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

In February 2016, FASB issued ASU 2016-02, Leases (Topic 842). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period and is applied retrospectively. Early adoption is permitted. We are currently in the process of assessing the impact the adoption of this guidance will have on the Companys consolidated financial statements.   In February 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2015-02 (ASU 2015-02) "Consolidation (Topic 810): Amendments to the Consolidation Analysis." ASU 2015-02 changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. It is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. We are currently in the process of evaluating the impact of the adoption of ASU 2015-02 on our consolidated financial statements.   In November 2014, the FASB issued ASU No. 2014-17, Business Combination. The provisions of ASU No. 2014-17 require management to determining whether and at what threshold an acquiree (acquired entity) can reflect the acquirers accounting and reporting basis (pushdown accounting) in its separate financial statements. Since neither unit of this business combination is in the development stage, nor had recognizable revenues during this period the application of push down accounting would not be of significant value to the readers of these condensed consolidated financial statements.  The Company has not elected to apply pushdown accounting in its separate financial statements upon occurrence of this event.     During August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial StatementsGoing Concern. The provisions of ASU No. 2014-15 require management to assess an entitys ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of managements plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of managements plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this ASU are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company is currently assessing the impact of this ASU on the Companys consolidated financial statements.   During June 2014, the FASB issued an Accounting Standards Update No. 2014-10, "Development Stage Entities (Topic 915) - Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation ("ASU 2014-10")".  The objective of ASU 2014-10 is to improve financial reporting by reducing the cost and complexity associated with the incremental reporting requirements for development stage entities.  ASU 2014-10 is effective for annual reporting periods beginning after December 15, 2014, and interim periods therein.  The Company has elected early implementation, as permitted by the standard, for the interim period ending June 30, 2014.  All exploration stage language disclosures and amounts have been removed as a result of the adoption of ASU 2014-10.   The changes permit businesses and other organizations to first use subjective criteria to determine if an intangible asset has lost value. The amendments to U.S. GAAP will be effective for fiscal years starting after September 15, 2012. The Companys adoption of this accounting guidance does not have a material impact on the consolidated financial statements and related disclosures.   There were other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to have a material impact on the Companys financial position, results of operations or cash flows.

For the binomial lattice options pricing model, the Company used the following assumptions and weighted average fair value ranges as at the transaction date, April 28, 2014, and for the period ended June 30, 2016:   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">Convertible Notes:</td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> April 28, 2014</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 78%">Risk free interest rate</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">0.0577%</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">N/A</td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Dividend yield</td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Volatility</td> <td> </td> <td> </td> <td style="text-align: center">86.31%</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">Warrants:</td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> April 28, 2014</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 78%">Risk free interest rate</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">0.144%</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: center">N/A</td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Dividend yield</td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Volatility</td> <td> </td> <td> </td> <td style="text-align: center">97.33%</td> <td> </td> <td> </td> <td> </td> <td style="text-align: center">N/A</td> <td> </td></tr> </table>

As a result of the disposal of the business and the discontinuance of the eCigarette operations, the following chart reflects the results of the condensed consolidated financial statements as loss from discontinued operations as of June 30, 2016:   <table cellspacing="0" cellpadding="0" style="width: 100%"> <tr> <td style="width: 100%; font: 12pt Times New Roman, Times, Serif; text-align: center">WHITE FOX VENTURES, INC.</td></tr> <tr> <td style="font: 12pt Times New Roman, Times, Serif; text-align: center">(FORMERLY BREATHE ECIG CORP.)</td></tr> <tr> <td style="font: 12pt Times New Roman, Times, Serif; text-align: center">CONSOLIDATED STATEMENTS OF DISCOUNTED OPERATIONS</td></tr> <tr> <td style="font: 12pt Times New Roman, Times, Serif; text-align: center">FOR THE THREE AND  SIX MONTHS ENDED JUNE 30, 2016 AND 2015</td></tr> <tr> <td style="font: 12pt Times New Roman, Times, Serif; text-align: center">(UNAUDITED)</td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="6" style="text-align: center">SIX MONTHS ENDED</td> <td nowrap="nowrap"> </td> <td style="text-align: center"> </td> <td colspan="6" style="text-align: center">THREE MONTHS ENDED</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="6" style="text-align: center">JUNE 30,</td> <td nowrap="nowrap"> </td> <td style="text-align: center"> </td> <td colspan="6" style="text-align: center">JUNE 30,</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">2016</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">2015</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: right">2016</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: right">2015</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 52%">REVENUE</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">19</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">6,000</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">-</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">6,000</td> <td nowrap="nowrap" style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">COST OF GOODS SOLD</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">1,851</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">7,057</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">7,057</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">GROSS LOSS</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,832</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,057</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,057</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>OPERATING EXPENSES</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-indent: 9pt">Research and development</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">2,178</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">1,648</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-indent: 9pt">Marketing, advertising and promotion</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">9,000</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">438,233</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">3,000</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">424,458</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-indent: 9pt">Rent</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">7,122</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">1,187</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">3,561</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">1,187</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-indent: 9pt">Salaries and related expenses, including stock-based compensation</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">10,911</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">114,150</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">97,649</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-indent: 9pt">Professional fees</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">1,155,236</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">323,712</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-indent: 9pt">Depreciation and amortization</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">12,449</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">9,195</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt; text-indent: 9pt">General and administrative</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">1,631</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">167,076</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">144,504</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt; text-indent: 45pt">Total operating expenses</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">28,664</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">1,890,509</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">6,561</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">1,002,353</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>OTHER (INCOME) EXPENSE</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt; text-indent: 9pt">Loss from Inventory valuation LCM</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(224</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt; text-indent: 45pt">Total other (income) expense</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(224</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Net loss before provision for income taxes</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(30,272</td> <td nowrap="nowrap">)</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(1,891,566</td> <td nowrap="nowrap">)</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(6,561</td> <td nowrap="nowrap">)</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(1,003,410</td> <td nowrap="nowrap">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">Provision for income taxes</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right"> </td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">Net loss</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">(30,272</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,891,566</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">(6,561</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">(1,003,410</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">)</td></tr> </table>     WHITE FOX VENTURES, INC. (FORMERLY BREATHE ECIG CORP.) BALANCE SHEET FROM DISCONTINUED OPERATIONS <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid"> June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="3" style="border-bottom: black 1.5pt solid"> December 31, 2015</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 78%">Assets of discontinued operations</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 8%; text-align: right">113,843</td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: right">114,067</td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Liabilities of discontinued operations</td> <td style="text-align: right"> </td> <td>$</td> <td style="text-align: right">250,443</td> <td> </td> <td> </td> <td> </td> <td style="text-align: right">232,771</td> <td> </td></tr> </table>

The following table summarizes information about the Companys stock options:   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center">June 30, 2016</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center">December 31, 2015</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Number of</td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">exercise</td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Number of</td> <td> </td> <td> </td> <td colspan="2" style="text-align: center">exercise</td> <td> </td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">options</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">Price</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">options</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">price</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td> <td> </td> <td colspan="2"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 52%">Options outstanding, beginning of period</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">-</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right">$</td> <td style="width: 9%; text-align: right">-</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 9%; text-align: center">   2,000</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%; text-align: right">$</td> <td style="width: 9%; text-align: center">          25.00</td> <td style="width: 1%; text-align: right"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Granted</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Exercised</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Forfeited</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right">-</td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt">Expired</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">$</td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid">   (2,000)</td> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(25.00)</td> <td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 3pt">Options outstanding, end of period</td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double">                 -</td> <td style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td style="padding-bottom: 3pt"> </td></tr> </table>

The following table summarizes the Companys share warrants outstanding as of June 30, 2016 and December 31, 2015:   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center">June 30, 2016</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center">December 31, 2015</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Weighted</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Average</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">average</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="text-align: center">Number of</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">remaining</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Exercise</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">Number of</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">remaining</td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2" style="text-align: center">exercise</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">warrants</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">life (years)</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">Price</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">warrants</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">life (years)</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center">price</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td> <td> </td> <td colspan="2"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 28%">Warrants outstanding, beginning of year</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">-</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">-</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">-</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">15,406</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 9%; text-align: right">1.5</td> <td nowrap="nowrap" style="width: 1%"> </td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%">$</td> <td style="width: 9%; text-align: right">66.00</td> <td nowrap="nowrap" style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>Granted</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>Exercised</td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">(6,906 </td> <td nowrap="nowrap">) </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right">-</td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt">Expired</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">(8.500 </td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">) </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 3pt">Warrants outstanding, end of year</td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt"> </td> <td style="border-bottom: black 2.25pt double">$</td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double">$</td> <td style="border-bottom: black 2.25pt double; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 3pt"> </td></tr> </table>

A reconciliation of the Companys effective tax rate as a percentage of income before taxes and the statutory rate for year ended June 30, 2016 is summarized below:   <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 89%">Federal rate</td> <td style="width: 1%; text-align: right"> </td> <td style="width: 1%"> </td> <td style="width: 8%; text-align: right">34 </td> <td nowrap="nowrap" style="width: 1%">%</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt">State rate</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">-</td> <td nowrap="nowrap" style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td style="text-align: right"> </td> <td nowrap="nowrap"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt">Combined Tax Rate</td> <td style="padding-bottom: 1.5pt; text-align: right"> </td> <td style="border-bottom: black 1.5pt solid"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right">34 </td> <td nowrap="nowrap" style="padding-bottom: 1.5pt">%</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 3pt">Valuation allowance</td> <td style="padding-bottom: 3pt; text-align: right"> </td> <td style="border-bottom: black 2.25pt double"> </td> <td style="border-bottom: black 2.25pt double; text-align: right">(34 </td> <td nowrap="nowrap" style="padding-bottom: 3pt">)%</td></tr> </table>

2016-01-16

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19737 Prior year amounts are presented in accordance with Amendment No. 1 on Form 10 Q/A for the quarters ended March 31, 2015 and June 30, 2015 as filed with the Securities and Exchange Commission on November 10, 2015. The required adjustments were made to correct the error to properly account for its accounting for the acquisition of Breathe eCigs Corp. (formerly Breathe LLC) on January 16, 2015 as a reverse merger for accounting purposes.

The Company had the following financial commitments, represented by lease agreements, as of June 30 2016,   <table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 12pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td colspan="3" style="font-size: 10pt; border-bottom: Black 1pt solid; text-align: left">Year ending December 31,</td><td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 1%; font-size: 10pt; text-align: left"> </td><td style="width: 43%; font-size: 10pt; text-align: left">2016</td><td style="width: 1%; font-size: 10pt; text-align: left"> </td><td style="width: 10%; font-size: 10pt"> </td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td><td style="width: 43%; font-size: 10pt; text-align: right">45,181</td><td style="width: 1%; font-size: 10pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left"> </td><td style="font-size: 10pt; text-align: left">2017</td><td style="font-size: 10pt; text-align: left"> </td><td style="font-size: 10pt"> </td> <td style="font-size: 10pt; text-align: left"> </td><td style="font-size: 10pt; text-align: right">103,271</td><td style="font-size: 10pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">2018</td><td style="padding-bottom: 1pt; font-size: 10pt; text-align: left"> </td><td style="font-size: 10pt; padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">50,013</td><td style="padding-bottom: 1pt; font-size: 10pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="font-size: 10pt; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">198,465</td><td style="padding-bottom: 2.5pt; font-size: 10pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left"> </td><td style="text-align: left"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> </table>   Rent expense for the three and six months ended June 30, 2016 was $3,561 and $7,122 compared to $1,187 and $1,187 for the same period in the prior year.  All rental amounts are presented in discontinued operations.   On March 15, 2015 the Company entered into a 38-month lease agreement for office space 322 Nancy Lane, Suite 7, Knoxville, Tennessee.   This office was the former operational headquarters for the Company.  The Company is currently working with the landlord to find another tenant for this space and remove this obligation.   On April 25, 2016 the Company entered into a lease agreement for virtual office space on New York City, New York to conduct Company business and investor relations.  Rent payments commenced on May 1, 2016.  Total commitment is $2,790 with expiration of April 30, 2016.   On June 20, 2016, White Fox Japan LLC, the Companys majority owned subsidiary entered into an approximately two-year lease for office space.  The lease will commence on August 1, 2016, expiring June 19, 2018.  Rent is fixed over the lease period at $7,300 per month.

<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 12pt Times New Roman, Times, Serif"> <tr style="vertical-align: bottom"> <td colspan="3" style="font-size: 10pt; border-bottom: Black 1pt solid; text-align: left">Year ending December 31,</td><td style="font-size: 10pt; font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="3" style="font-size: 10pt; font-weight: bold; text-align: center"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 1%; font-size: 10pt; text-align: left"> </td><td style="width: 43%; font-size: 10pt; text-align: left">2016</td><td style="width: 1%; font-size: 10pt; text-align: left"> </td><td style="width: 10%; font-size: 10pt"> </td> <td style="width: 1%; font-size: 10pt; text-align: left">$</td><td style="width: 43%; font-size: 10pt; text-align: right">45,181</td><td style="width: 1%; font-size: 10pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="font-size: 10pt; text-align: left"> </td><td style="font-size: 10pt; text-align: left">2017</td><td style="font-size: 10pt; text-align: left"> </td><td style="font-size: 10pt"> </td> <td style="font-size: 10pt; text-align: left"> </td><td style="font-size: 10pt; text-align: right">103,271</td><td style="font-size: 10pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">2018</td><td style="padding-bottom: 1pt; font-size: 10pt; text-align: left"> </td><td style="font-size: 10pt; padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">50,013</td><td style="padding-bottom: 1pt; font-size: 10pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="font-size: 10pt; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">198,465</td><td style="padding-bottom: 2.5pt; font-size: 10pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left"> </td><td style="text-align: left"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> </table>

N/A

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Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2016	Aug. 12, 2016
Document and Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2016
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2016
Entity Registrant Name	WHITE FOX VENTURES, INC.
Entity Central Index Key	0001506503
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Common Stock, Shares Outstanding		40,178,957

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CONDENSED CONSOLIDATED BALANCE SHEETS - CAD	Jun. 30, 2016	Dec. 31, 2015
CURRENT ASSETS
Cash	CAD 0	CAD 10,955
Prepaid expenses	8,333	52,051
Investment in Kudzoo, Inc.	50,000	0
Assets from discontinued operations	113,843	114,067
Total current assets	172,176	177,073
TOTAL ASSETS	172,176	177,073
CURRENT LIABILITIES
Accounts payable and accrued expenses	353,150	444,670
Notes payable - current portion	172,970	319,361
Accrued interest	2,552	17,162
Liability for stock to be issued	51,021	82,710
Notes payable - related parties	75,000	1,175,000
Liabilities of discontinued operations	250,443	232,771
Total current liabilities	905,136	2,271,674
TOTAL LIABILITIES	905,136	2,271,674
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock, $0.001 par value, 10,000,000 shares authorized Nil shares issued and outstanding	0	0
Common stock, $0.001 par value, 8,000,000,000 and 500,000,000 shares authorized, respectively 38,728,856 and 4,708,113 shares issued and outstanding, respectively	38,729	4,708
Additional paid in capital	8,970,568	7,339,096
Accumulated deficit	(9,742,257)	(9,438,405)
Total stockholders' equity (deficit)	(732,960)	(2,094,601)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	CAD 172,176	CAD 177,073

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Preferred stock, par value	$ .001	$ .001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ .001	$ .001
Common stock, shares authorized	8,000,000,000	500,000,000
Common stock, shares issued	38,728,856	4,708,113
Common stock, shares outstanding	38,728,856	4,708,113

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)	3 Months Ended				6 Months Ended
	Jun. 30, 2016 $ / shares	Jun. 30, 2016 CAD shares	Jun. 30, 2015 $ / shares	Jun. 30, 2015 CAD shares	Jun. 30, 2016 $ / shares	Jun. 30, 2016 CAD shares	Jun. 30, 2015 $ / shares	Jun. 30, 2015 CAD shares
Income Statement [Abstract]
REVENUE		CAD 0		CAD 0		CAD 0		CAD 0
COST OF GOODS SOLD		0		0		0		0
GROSS LOSS		0		0		0		0
OPERATING EXPENSES
Professional fees		55,600		4,436,260		185,901		4,459,807
General and administrative		10,617		34,190		62,967		86,540
Total operating expenses		66,217		4,470,450		248,868		4,546,347
OTHER (INCOME) EXPENSE
Interest expense, net		860		174,813		21,891		177,674
Gain on conversion of debt		27,500		0		2,821		0
Fair value adjustment on derivative liability		0		26,803		0		60,193
Total other (income) expense		28,360		201,616		24,712		237,867
Net loss before provision for income taxes		(94,577)		(4,672,066)		(273,580)		(4,784,214)
Provision for income taxes		0		0		0		0
Net loss from continuing operations		(94,577)		(4,672,066)		(273,580)		(4,784,214)
Loss from discontinued operations		(6,561)		(1,003,410)		(30,272)		(1,891,566)
Net loss		CAD (101,138)		CAD (5,675,476)		CAD (303,852)		CAD (6,675,780)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING \| shares		25,024,651		3,156,071		12,930,465		2,752,157
NET LOSS PER SHARE \| $ / shares	$ 0.00		$ (1.48)		$ (0.02)		$ (1.74)

XML 16 R5.htm IDEA: XBRL DOCUMENT

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED) - CAD	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	CAD (303,852)	CAD (6,675,780)
Adjustments to reconcile net (loss) to net cash (used in) operating activities:
Depreciation and amortization	0	12,449
Amortization of deferred financing fees	0	6,358
Non-cash interest charges	2,062	0
Amortization of original issue discount	19,829	6,958
Legal fees incurred deducted from proceeds of notes payable	0	24,250
Gain on extinguishment of debt	2,821	0
Fair value adjustment in derivative liabilities	0	60,193
Common stock/stock options issued or to be issued for services rendered	0	5,891,495
Change in assets and liabilities
(Increase) decrease in prepaid expenses and deposits	43,718	(865,528)
Decrease in inventory	224	(120,072)
Decrease in accounts payable and accrued expenses	(155,841)	262,226
Net cash (used in) operating activities	(391,039)	(1,397,451)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of fixed assets	0	0
Purchase of Investment in Kudzoo, Inc.	(50,000)	0
Acquisition of mining rights	0	0
Net cash (used in) investing activities	(50,000)	0
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds received from convertible notes	0	770,250
Repayments of notes payable	0	(32,500)
Proceeds from promissory notes - related party	47,500	0
Proceeds received for common stock and liability for stock to be issued	382,584	708,770
Net cash provided by financing activities	430,084	1,446,520
NET (DECREASE) IN CASH	(10,955)	49,069
CASH - BEGINNING OF PERIOD	10,955	13,346
CASH - END OF PERIOD	0	62,415
Cash paid during the period for:
Interest	0	20,308
Income taxes	0	0
Reverse Merger of Breathe LLC
Accumulated deficit	0	7,733,077
Prepaid expenses	0	191,584
Fixed assets	0	138,049
Mining rights	0	1,035,818
Accounts payable	0	(111,275)
Asset retirement obligation	0	0
Note payable	0	0
Accumulated comprehensive income	0	0
Due to Company	0	0
Adjustment to APIC	0	9,089,658
Shares received in TAUG for commercialization of product at fair value	0	100,000
Common shares issued for investment in Tauriga	0	100,000
Original issue discount netted from convertible notes	0	58,000
Inventory purchased through issuance of common stock	0	22,500
Common shares issued for conversion of debt	146,220	406,385
Common shares issued and to be issued for conversion of related party notes payable	CAD 1,105,000	CAD 22,500

XML 17 R6.htm IDEA: XBRL DOCUMENT

ORGANIZATION AND BASIS OF PRESENTATION

6 Months Ended

Jun. 30, 2016

ORGANIZATION AND BASIS OF PRESENTATION

The common shares for the acquisition were valued at their fair market value on the day they were issued which totaled $340,000. The total cost of the acquisition amounted to $403,840.

The Company in March 2015 entered into Distribution Agreements with various distributors for the distribution of the Company’s products.

On March 15, 2016, the Company had their DEF 14A approved by the SEC. As a result of this, the authorized common stock increased from 500,000,000 to 8,000,000,000 shares. The common share increase was approved by the Company’s board of Directors on February 1, 2016. In lieu of calling a special meeting of our stockholders, our Board of Directors had elected to obtain stockholder approval of the Authorized Share Increase Amendment by written consent (“Written Consent”) pursuant to Article II, Section 12 of our Bylaws and Section 78.370 of the Nevada Revised Statues. The close of business on February 18, 2016 was fixed as the record date for the determination of holders of our Common Stock entitled to receive notice of and discretion to approve the Authorized Share Increase Amendment.

Going Concern

Basis of Accounting

These consolidated financial statements are prepared in conformity with United States generally accepted accounting principles (“U.S. GAAP”) and are presented in U.S. dollars.

Use of Estimates

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

Business Combination

Stock Based Compensation

Comprehensive Income (Loss)

The Company adopted ASC 220-10, “Reporting Comprehensive Income,” (formerly SFAS No. 130). ASC 220-10 requires the reporting of comprehensive income in addition to net income from operations.

Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of information that historically has not been recognized in the calculation of net income.

Cash and Cash Equivalents

The Company considers all highly liquid debt instruments and other short-term investments with maturity of three months or less, when purchased, to be cash equivalents.

At June 30, 2016 the Company did not maintain cash or cash equivalent balances at any major United States bank.

Income Taxes

Revenue Recognition

Trade Receivables and Allowance for Doubtful Accounts

Inventory

Finished Goods Inventory - Finished goods inventory is stated at the lower of cost or market determined by the first-in, first-out method, and include salable eCigarette product items and supplies that are sale ready to ship to consumers, wholesalers or distributers. Shipping and handling costs (consisting of all costs to warehouse, pick, pack and deliver inventory to customers) will be included in cost of goods sold. Samples are included in marketing expenses which are a component of general and administrative costs. The Company in March 2015 entered into Distribution Agreements with various distributors for the distribution of the Company’s products. The Company placed an initial order for merchandise in the amount of $437,750 on March 27, 2015. The Company has outsourced the assembly and production of its products held for resale and will not hold any of the product in its possession. The Company’s inventory is received, housed and distributed by a third party fulfillment provider. As of June 30, 2016, the inventory held by the third party fulfillment provider had a value of $227,685.

As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

Loss Per Share of Common Stock

Basic net loss per share (“Basic EPS”) is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding for the period.

Dilutive common share issuances shall be deemed to have been converted into ordinary shares at the beginning of the period.

Derivative Financial Instruments

Convertible Notes:	April 28, 2014		June 30, 2016
Risk free interest rate		0.0577%		N/A
Dividend yield		N/A		N/A
Volatility		86.31%		N/A

Warrants:	April 28, 2014		June 30, 2016
Risk free interest rate		0.144%		N/A
Dividend yield		N/A		N/A
Volatility		97.33%		N/A

Reclassifications

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

Restated Financial Statements

Recent Issued Accounting Standards

In November 2014, the FASB issued ASU No. 2014-17, “Business Combination.” The provisions of ASU No. 2014-17 require management to determining whether and at what threshold an acquiree (acquired entity) can reflect the acquirer’s accounting and reporting basis (pushdown accounting) in its separate financial statements. Since neither unit of this business combination is in the development stage, nor had recognizable revenues during this period the application of push down accounting would not be of significant value to the readers of these condensed consolidated financial statements. The Company has not elected to apply pushdown accounting in its separate financial statements upon occurrence of this event.

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ACQUISITION

6 Months Ended

Jun. 30, 2016

Business Combinations [Abstract]

ACQUISITION

Breathe eCigs Corp. Acquisition and Spin-off of DNA Canada, Inc.

On January 16, 2015, Breathe eCigs Corp., a Tennessee corporation (“Breathe”), entered into a Share Exchange Agreement (the “Exchange Agreement”) with the Company, whereby the Company acquired all of the issued and outstanding shares of common stock of Breathe in consideration for the issuance of 1,500,000 shares of common stock.

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

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DISCONTINUED OPERATIONS

6 Months Ended

Jun. 30, 2016

Discontinued Operations

DISCONTINUED OPERATIONS

Trademark Settlement/Disposal of eCigarette Operations

As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company is required to pay two cash payments ($10,000 paid March 31, 2016 and $15,000 originally due by July 31, 2016 and was paid on August 10, 2016.) Under the agreement, the Company also is required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016 at a value of $50,000) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. (at a value of $0 as this had been written off). The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.

As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

CONSOLIDATED STATEMENTS OF DISCOUNTED OPERATIONS

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2016 AND 2015

(UNAUDITED)

	SIX MONTHS ENDED						THREE MONTHS ENDED
	JUNE 30,						JUNE 30,
	2016			2015			2016			2015
REVENUE	$	19		$	6,000		$	-		$	6,000

COST OF GOODS SOLD		1,851			7,057			-			7,057

GROSS LOSS		(1,832	)		(1,057	)		-			(1,057	)

OPERATING EXPENSES
Research and development		-			2,178			-			1,648
Marketing, advertising and promotion		9,000			438,233			3,000			424,458
Rent		7,122			1,187			3,561			1,187
Salaries and related expenses, including stock-based compensation		10,911			114,150			-			97,649
Professional fees		-			1,155,236			-			323,712
Depreciation and amortization		-			12,449			-			9,195
General and administrative		1,631			167,076			-			144,504
Total operating expenses		28,664			1,890,509			6,561			1,002,353

OTHER (INCOME) EXPENSE
Loss from Inventory valuation LCM		(224	)		-			-			-
Total other (income) expense		(224	)		-			-			-

Net loss before provision for income taxes		(30,272	)		(1,891,566	)		(6,561	)		(1,003,410	)

Provision for income taxes		-			-						-

Net loss	$	(30,272	)	$	(1,891,566	)	$	(6,561	)	$	(1,003,410	)

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

BALANCE SHEET FROM DISCONTINUED OPERATIONS

	June 30, 2016		December 31, 2015
Assets of discontinued operations	$	113,843		114,067

Liabilities of discontinued operations	$	250,443		232,771

The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

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CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES

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CONVERTIBLE NOTES AND DERIVATIVE LIABILITIES

6 Months Ended

Jun. 30, 2016

Debt Disclosure [Abstract]

On March 25, 2016, the Company paid $55,000 to Typenex to settle all obligations resulting from these agreements.

Convertible Note dated February 4, 2015

Convertible Note dated February 9, 2015

Convertible Note dated March 6, 2015

Convertible Note dated March 11, 2015

Convertible Note dated March 13, 2015

Convertible Note dated March 31, 2015

Convertible Note dated April 8, 2015

Convertible Note 1 dated May 22, 2015

Convertible Note 2 dated May 22, 2015

Convertible Note dated June 8, 2015

As of June 30, 2016, the Company has $40,000 outstanding on this note inclusive of accrued default interest fees.

Convertible Note dated June 10, 2015

Convertible Note dated December 23, 2015

Convertible Note dated December 24, 2015

As of June 30, 2016, the amount outstanding under this note was $43,000.

All convertible notes payable are due within one year and are reflected as current liabilities in the condensed consolidated balance sheet at June 30, 2016.

Derivative Liability - Warrants

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STOCKHOLDERS' DEFICIT

6 Months Ended

Jun. 30, 2016

Stockholders' Equity Note [Abstract]

STOCKHOLDERS' DEFICIT

Preferred Stock

The Company was established on June 2, 2006 with 10,000,000 shares of preferred stock authorized with a par value of $0.001. The Company has not issued any preferred stock.

Common Stock

On May 23, 2016 the Company filed with the Secretary of State for the State of Nevada, the amendment to its state corporate charter to change the name of the company to White Fox Ventures, Inc. (“White Fox”) to better reflect the new direction of the business and to effect a 100:1 reverse stock split. On May 27, 2016, the Company filed the necessary documents with FINRA requesting these items as well as request a new ticker symbol.

In 2015, the Company issued:

On January 20, 2015 1,500,000 shares were issued in the acquisition of Breathe which was accounted for as reverse merger.

269,839 common shares were issued for cash in the amount of $1,047,270 at an average share price of $3.90.

171,500 common shares of stock to noteholders as commitment and assignment shares and recorded as debt financing cost at a value of $176,050 (average price $1.00.)

In 2016, the Company issued:

Authorized Reserved Shares

Stock Options

The following table summarizes information about the Company’s stock options:

	June 30, 2016				December 31, 2015
			Weighted				Weighted
			average				average
	Number of		exercise		Number of		exercise
	options		Price		options		price

Options outstanding, beginning of period		-	$	-		2,000	$	25.00
Granted		-		-		-		-
Exercised		-				-		-
Forfeited		-				-		-
Expired		-	$	-		(2,000)		(25.00)

Options outstanding, end of period		-		-		-		-

Stock options-based compensation expense included in the condensed consolidated statements of operations and comprehensive loss for the six months ended June 30, 2016 and 2015 was $0.

Warrants

The following table summarizes the Company’s share warrants outstanding as of June 30, 2016 and December 31, 2015:

	June 30, 2016						December 31, 2015
			Weighted		Weighted					Weighted		Weighted
			average		Average					average		average
	Number of		remaining		Exercise		Number of			remaining		exercise
	warrants		life (years)		Price		warrants			life (years)		price

Warrants outstanding, beginning of year		-		-	$	-		15,406			1.5	$	66.00
Granted		-		-		-		-			-		-
Exercised		-		-		-		(6,906	)		-		-
Expired		-		-		-		(8.500	)		-		-

Warrants outstanding, end of year		-		-	$	-		-			-	$	-

On August 12, 2013, the Company approved and enacted the 2013 Stock Incentive Plan (the “Plan”). Under the 2013 Stock Incentive Plan, the Company may grant options or share awards to its full-time employees, executive officers, directors and consultants up to a maximum of 80,000 common shares. Under the Plan, the exercise price of each option has been established at $25.00. Stock options vest as stipulated in the stock option agreement and their maximum term is 8 years. 8,500 options were issued in 2013 which expired in 2015. As of June 30, 2016, there are no warrants outstanding.

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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-Section S99
-Paragraph 4
-Subparagraph (SAB Topic 4.C)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187143-122770

Reference 8: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(30))
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Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Preferred Stock
-URI http://asc.fasb.org/extlink&oid=6521494

Reference 15: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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LICENSE AGREEMENT AND INVESTMENT

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LICENSE AGREEMENT AND INVESTMENT

6 Months Ended

Jun. 30, 2016

Notes to Financial Statements

Description	Amount
Stock issued	$	100,000

Total	$	100,000
Less: Management impairment valuation		100,000
Net June 30, 2016 and December 31, 2015 balances	$	-

Issued 26,667 shares of Company common stock		26,667
at $1.00 per share.	$	3.75
Share value	$	100,000
Less: Management impairment valuation	$	100,000
Net June 30, 2016 and December 31, 2015 balances	$	-

XML 24 R13.htm IDEA: XBRL DOCUMENT

RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2016

RELATED PARTY TRANSACTIONS

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PROVISION FOR INCOME TAXES

6 Months Ended

Jun. 30, 2016

Income Tax Disclosure [Abstract]

PROVISION FOR INCOME TAXES

As of June 30, 2016, there is no provision for income taxes, current or deferred.

Net operating losses carryforward	$	3,312,367
Valuation allowance		(3,312,367	)
	$	-

A reconciliation of the Company’s effective tax rate as a percentage of income before taxes and the statutory rate for year ended June 30, 2016 is summarized below:

Federal rate	34	%
State rate	-

Combined Tax Rate	34	%
Valuation allowance	(34	)%

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COMMITMENTS

6 Months Ended

Jun. 30, 2016

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS

The Company had the following financial commitments, represented by lease agreements, as of June 30 2016,

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CURRENT LITIGATION

6 Months Ended

Jun. 30, 2016

Notes to Financial Statements

CURRENT LITIGATION

The Company had the following financial commitments, represented by lease agreements, as of June 30 2016,

Year ending December 31,	Total		Future Obilgation
2016		43,537.58		46,825
2017		99,815.16		103,102
2018		56,911.90		58,281
				208,208

Trademark dispute

As of March 30, 2016, pursuant to a settlement agreement under trademark litigation with plaintiff, Breathe LLC (a Florida organization), the Company had ceased its continuing operations in the eCigarette business (the effective date of the discontinuance of operations in that industry). In accordance with the settlement agreement, the Company will pay two cash payments ($10,000 immediately and $15,000 was originally due by July 31, 2016 and was paid August 10, 2016.) The Company is also required to issue 500,000 restricted common shares of Company stock (which was issued April 15, 2016) in addition to the transfer of 5,000,000 common shares which it holds in Tauriga Sciences, Inc. The Company further agrees to split 50/50 any future sales of its held inventory. The sale of inventory shall be a joint effort by the two companies and shall last for a duration of one year from April 1, 2016. After such period, the Company will dispose of any remaining inventory.

As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

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SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2016

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

Corporate Matters

On July 20, 2016 the Company began trading under its new ticker symbol, AWAW.

Notes Payable

Stock Issuances

On July 19, 2016, the Company issued 1,450,000 common shares to the holder of three convertible notes for the conversion of remaining principal.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

Basis of Accounting

These consolidated financial statements are prepared in conformity with United States generally accepted accounting principles (“U.S. GAAP”) and are presented in U.S. dollars.

Use of Estimates

Principles of Consolidation

Business Combination

Stock Based Compensation

Comprehensive Income (Loss)

The Company adopted ASC 220-10, “Reporting Comprehensive Income,” (formerly SFAS No. 130). ASC 220-10 requires the reporting of comprehensive income in addition to net income from operations.

Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of information that historically has not been recognized in the calculation of net income.

Cash and Cash Equivalents

The Company considers all highly liquid debt instruments and other short-term investments with maturity of three months or less, when purchased, to be cash equivalents.

At June 30, 2016 the Company did not maintain cash or cash equivalent balances at any major United States bank.

Income Taxes

Revenue Recognition

Trade Receivables and Allowance for Doubtful Accounts

Inventory

As of August 15, 2016, the Company has not transferred the 5,000,000 common shares which it holds in Tauriga Sciences, Inc.

Loss Per Share of Common Stock

Basic net loss per share (“Basic EPS”) is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding for the period.

Dilutive common share issuances shall be deemed to have been converted into ordinary shares at the beginning of the period.

Derivative Financial Instruments

Convertible Notes:	April 28, 2014		June 30, 2016
Risk free interest rate		0.0577%		N/A
Dividend yield		N/A		N/A
Volatility		86.31%		N/A

Warrants:	April 28, 2014		June 30, 2016
Risk free interest rate		0.144%		N/A
Dividend yield		N/A		N/A
Volatility		97.33%		N/A

Reclassifications

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

Restated Financial Statements

Recent Issued Accounting Standards

In November 2014, the FASB issued ASU No. 2014-17, “Business Combination.” The provisions of ASU No. 2014-17 require management to determining whether and at what threshold an acquiree (acquired entity) can reflect the acquirer’s accounting and reporting basis (pushdown accounting) in its separate financial statements. Since neither unit of this business combination is in the development stage, nor had recognizable revenues during this period the application of push down accounting would not be of significant value to the readers of these condensed consolidated financial statements. The Company has not elected to apply pushdown accounting in its separate financial statements upon occurrence of this event.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2016

Accounting Policies [Abstract]

Schedule of Assumptions Used

Convertible Notes:	April 28, 2014		June 30, 2016
Risk free interest rate		0.0577%		N/A
Dividend yield		N/A		N/A
Volatility		86.31%		N/A

Warrants:	April 28, 2014		June 30, 2016
Risk free interest rate		0.144%		N/A
Dividend yield		N/A		N/A
Volatility		97.33%		N/A

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DISCONTINUED OPERATIONS (Tables)

6 Months Ended

Jun. 30, 2016

Discontinued Operations Tables

Discontinued operations

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

CONSOLIDATED STATEMENTS OF DISCOUNTED OPERATIONS

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2016 AND 2015

(UNAUDITED)

	SIX MONTHS ENDED						THREE MONTHS ENDED
	JUNE 30,						JUNE 30,
	2016			2015			2016			2015
REVENUE	$	19		$	6,000		$	-		$	6,000

COST OF GOODS SOLD		1,851			7,057			-			7,057

GROSS LOSS		(1,832	)		(1,057	)		-			(1,057	)

OPERATING EXPENSES
Research and development		-			2,178			-			1,648
Marketing, advertising and promotion		9,000			438,233			3,000			424,458
Rent		7,122			1,187			3,561			1,187
Salaries and related expenses, including stock-based compensation		10,911			114,150			-			97,649
Professional fees		-			1,155,236			-			323,712
Depreciation and amortization		-			12,449			-			9,195
General and administrative		1,631			167,076			-			144,504
Total operating expenses		28,664			1,890,509			6,561			1,002,353

OTHER (INCOME) EXPENSE
Loss from Inventory valuation LCM		(224	)		-			-			-
Total other (income) expense		(224	)		-			-			-

Net loss before provision for income taxes		(30,272	)		(1,891,566	)		(6,561	)		(1,003,410	)

Provision for income taxes		-			-						-

Net loss	$	(30,272	)	$	(1,891,566	)	$	(6,561	)	$	(1,003,410	)

WHITE FOX VENTURES, INC.

(FORMERLY BREATHE ECIG CORP.)

BALANCE SHEET FROM DISCONTINUED OPERATIONS

	June 30, 2016		December 31, 2015
Assets of discontinued operations	$	113,843		114,067

Liabilities of discontinued operations	$	250,443		232,771

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Stockholders' Equity Note [Abstract]

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STOCKHOLDERS' DEFICIT (Tables)

6 Months Ended

Jun. 30, 2016

Schedule of Stock Option Activity

The following table summarizes information about the Company’s stock options:

	June 30, 2016				December 31, 2015
			Weighted				Weighted
			average				average
	Number of		exercise		Number of		exercise
	options		Price		options		price

Options outstanding, beginning of period		-	$	-		2,000	$	25.00
Granted		-		-		-		-
Exercised		-				-		-
Forfeited		-				-		-
Expired		-	$	-		(2,000)		(25.00)

Options outstanding, end of period		-		-		-		-

Schedule of Warrant Activity

The following table summarizes the Company’s share warrants outstanding as of June 30, 2016 and December 31, 2015:

	June 30, 2016						December 31, 2015
			Weighted		Weighted					Weighted		Weighted
			average		Average					average		average
	Number of		remaining		Exercise		Number of			remaining		exercise
	warrants		life (years)		Price		warrants			life (years)		price

Warrants outstanding, beginning of year		-		-	$	-		15,406			1.5	$	66.00
Granted		-		-		-		-			-		-
Exercised		-		-		-		(6,906	)		-		-
Expired		-		-		-		(8.500	)		-		-

Warrants outstanding, end of year		-		-	$	-		-			-	$	-