Certain statements in this Report constitute "forward-looking statements." Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that might cause such a differences include, among others, uncertainties relating to general economic and business conditions; industry trends; changes in demand for our products and services; uncertainties relating to customer plans and commitments and the timing of orders received from customers; announcements or changes in our pricing policies or that of our competitors; unanticipated delays in the development, market acceptance or installation of our products and services; changes in government regulations; availability of management and other key personnel; availability, terms and deployment of capital; relationships with third-party equipment suppliers; inflation, the war in Ukraine, supply chain slowdowns, reoccurring Covid-19 outbreaks both nationally and internationally, particularly in China, and worldwide political stability and economic growth. The words "believe," "expect," "anticipate," "hope," "intend" and "plan" and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.





Results of Operations

Three Months Ended February 28, 2023 compared with the Three Months Ended February 28, 2022

The narrative comparison of results of operations for the three-month periods ended February 28, 2023 and 2022 is based on the following table.





                                           February 28, 2023      February 28, 2022
REVENUE                                   $          382,240     $          24,343
COST OF REVENUE                                      346,923                14,405
Cost of revenue as a % of total revenue                   91 %                  59 %
Gross Profit                                          35,317                 9,938
Gross profit as a % of revenue                             9 %                  41 %
OPERATING EXPENSES
Officer and director compensation                     70,000               203,785
General and administrative                           425,915                48,771
Professional fees and contract services              101,427                22,445
Advertising and promotion                              1,214                28,088
Total operating expenses                             598,556               303,089
Loss from operations                                (563,239 )            (293,151 )
Other income (expense)                              (951,420 )             (34,134 )
NET LOSS                                  $       (1,514,659 )   $        (327,285 )




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Revenues in the quarter ended February 28, 2023 increased when compared to the same period in 2022. The increase is largely attributable to an intensified effort to bring our Colorado and California facilities online. In the quarter ended February 28, 2023, the Company generated $381,662 in sales of cannabis products.

Cost of revenues also increased in the quarter ended February 28, 2023 when compared with the same period in 2022. The increase is attributable to the costs incurred in our Colorado and California operations. In the three months ended February 28, 2023, we incurred operating costs associated with setting up and documenting our manufacturing processes and producing test batches of products to verify our systems were generating expected results at our Colorado and California facilities. During this phase, we did not produce significant quantities of product for resale. The production expenses of the test batches were, however, recorded as manufacturing costs. We expect margins to improve on our cannabis product lines in the coming periods as our manufacturing processes are standardized and our need to run test batches and adjust processes decreases.

Our General and Administrative costs ("G&A") increased in the quarter ended February 28, 2023, compared with the same period in 2022. The increase in G&A costs were primarily due to our decision to further develop our cannabis business through acquisition of the Colorado and California facilities and the related costs of setting up geographically disbursed manufacturing operations, in particular rent expense. Our advertising and promotion costs decreased significantly when compared to the same reporting period in the previous year.

Other income (expense) increased period over period due to interest expense on additional borrowings and amortization of discount associated with new notes payable.

Net loss increased in the three-month reporting period ending February 28, 2023 compared with the same period in 2022. The increase in the net loss is attributable to the factors identified above.

Nine Months Ended February 28, 2023 compared with the Nine Months Ended February 28, 2022

The narrative comparison of results of operations for the nine-month periods ended February 28, 2023 and 2022, is based on the following table.





                                           February 28, 2023      February 28, 2022
REVENUE                                   $          560,754     $          147,395
COST OF REVENUE                                      465,274                 50,774
Cost of revenue as a % of total revenue                   83 %                   34 %
Gross Profit                                          95,480                 96,621
Gross profit as a % of revenue                            17 %                   66 %
OPERATING EXPENSES
Officer and director compensation                    240,000                542,570
General and administrative                         1,035,829                113,644
Professional fees and contract services              259,957                176,710
Advertising and promotion                             (4,795 )              375,461
Total operating expenses                           1,530,991              1,208,385
Loss from operations                              (1,435,511 )           (1,111,764 )
Other income (expense)                            (2,516,620 )             (645,592 )
NET LOSS                                  $       (3,952,131 )   $       (1,757,356 )


                                        3

Revenues in the nine-month period ended February 28, 2023 increased when compared to the same period in 2022. The increase is largely attributable to an intensified effort to bring our Colorado and California facilities online. In the nine-month period ended February 28, 2023, the Company generated $549,928 in sales of cannabis products.

Cost of revenues increased in the nine-month period ended February 28, 2023 when compared with the same period in 2022. The increase is attributable to the costs incurred in our Colorado and California operations. In the nine-month period ended February 28, 2023, we incurred operating costs associated with setting up and documenting our manufacturing processes and producing test batches of products to verify our systems were generating expected results at our Colorado and California facilities. During this phase, we did not produce significant quantities of product for resale. The production expenses of the test batches were, however, recorded as manufacturing costs. We expect margins to improve on our cannabis product lines in the coming periods as our manufacturing processes are standardized and our need to run test batches and adjust processes decreases.

Our General and Administrative costs ("G&A") increased in the nine-month period ended February 28, 2023, compared with the same period in 2022. The increase in G&A costs were primarily due to our decision to further develop our cannabis business through acquisition of the Colorado and California facilities and the related costs of setting up geographically disbursed manufacturing operations, in particular rent expense. Our advertising and promotion costs decreased significantly when compared to the same reporting period in the previous year.

Other income (expense) increased period over period due to interest expense on additional borrowings and amortization of discount associated with new notes payable.

Net loss increased in the nine-month reporting period ending February 28, 2023 compared with the same period in 2022. The increase in the net loss is attributable to the factors identified above.

Liquidity and Capital Resources

Cash flow used by operating activities for the nine month period ended February 28, 2023, was $1,112,973 compared with $329,212 in the same period in 2022. During the period, our total cash increased by $120,784 to $161,671. The increase in our cash position at February 28, 2023 is largely attributable to borrowings associated with starting up operations in Colorado and California. Cash to fund cash flow from operations was derived primarily from proceeds of notes payable.

We continue to seek potential acquisition candidates with a focus on acquiring additional operating companies with scale sufficient to support all aspects of the Company's operations, including the public company infrastructure. The Company is currently heavily dependent on funding through advances from related parties, but no assurances can be given that such funding will continue to be available in future periods. Our historic operations have not been sufficient to support the existing infrastructure, much of which is required in order to maintain public company status.

We have maintained active operations as a manufacturer and distributor of the Debudder product line since 2018. We do not consider the Company to be a shell company as that term is defined in the Securities Act of 1933, as amended.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. We incurred a net loss of $3,952,131 for the nine months ended February 28, 2023, bringing our accumulated deficit to $15,926,172 as of February 28, 2023. These factors raise substantial doubt about the Company's ability to continue as a going concern. The Company may seek to raise money for working capital purposes through a public offering of its equity capital or through a private placement of equity capital or convertible debt. It will be important for the Company to succeed in its efforts to raise capital in this manner to further its business plan in an aggressive manner. Raising additional capital may cause dilution to current shareholders. There are no assurances we can be successful in our efforts to raise working capital.







                                        4

Off Balance Sheet Arrangements

None.

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