Item 9 Labs Corp. (OTCPK:INLB) entered into a purchase agreement to acquire the Assets of GMC, LLC from Gmc, LLC in September, 2018. The Company paid $300,000 in deposits represented on the balance sheet at December 31, 2019 under long term deposits on acquisitions. Item 9 Labs Corp. (OTCPK:INLB) cancelled the acquisition of Assets of GMC, LLC in December 2020. The Company forfeited $300,000 of deposits along with all $475,814 owed to the Company by GMC, LLC. These amounts are recognized in the Company’s net loss at December 31, 2020 in failed acquisition and settlement costs.