What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2019-01-11 compared with 2018-08-28 · 305 added, 343 removed, 941 unchanged (41% of the section changed)

10 unchanged sentences

The material weaknesses identified

related to (i) a lack of accounting staff and resources with appropriate knowledge of U.S.

GAAP and SEC reporting and compliance

requirements;

(ii) a lack of sufficient documented financial closing policies and procedures;

and (iii) a lack of independent

directors and an audit committee.

related to (i) lack of segregation of duties due to a lack of accounting staff;

(ii) a lack of sufficient documented financial

closing policies and procedures;

and (iii) a lack of independent directors and an audit committee.

plan to take steps to enhance and improve the design of our internal control over financial reporting.

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officer or director was or is to be selected as an officer or director.

The Directors took action six (6) times by written consent

The Directors took action two (2) times by written consent

during the fiscal year ended March 31, 2017.

30 unchanged sentences

$ 88,000 (2)(1)

and President

$ 88,000 (2)(1)

5 unchanged sentences

Rodriguez as of March 31, 2017 is $76,450.

Rodriguez was under an employment agreement dated April 1, 2014 that expired on March 31, 2016, pursuant to which

Rodriguez was under an employment agreement dated April 1, 2015 that expires on March 31, 2019, pursuant to which

he was compensated at an annual rate of $48,000.

1 unchanged sentence

During the fiscal

year ending March 31, 2016, we paid Mr.

year ended March 31, 2017, we paid Mr.

Rodriguez $35,700, and accrued $49,800.

During the fiscal year ending March

During the fiscal year ended March

31, 2016, we paid Mr.

16 unchanged sentences

That Have Not Vested

Kent Rodriguez

Douglas Barton

Rene Häusler

Company has an employment agreement with its President.

2 unchanged sentences

with or without cause.

Rodriguez was under an employment agreement dated April 1, 2011 that expired on March 31, 2016, pursuant to which he

Rodriguez was under an employment agreement dated April 1, 2015 that expires on March 31, 2019, pursuant to which he

was compensated at an annual rate of $48,000.

17 unchanged sentences

of Outstanding Common stock

Rodriguez (1)

Kent Rodriguez (1)

310 Fourth Avenue South, Suite

Douglas Barton

310 Fourth Avenue South, Suite

Minneapolis, MN 55415

310 Fourth Avenue South, Suite

Häusler (2)

Minneapolis, MN 55415

Rene Häusler (2)

310 Fourth Avenue South, Suite

Technology Exchange, Inc.

Minneapolis, MN 55415

IP Technology Exchange, Inc.

3802 Spectrum Blvd, Suite 128E

Tampa, FL 33612

Technology, Inc

Green Station

Bowling Green Station

New York, NY 10274

12,132,041 shares of Common Stock issuable upon the conversion of 100 shares of Series A Preferred Stock.

10 unchanged sentences

The Series A Preferred Stock provides for voting rights on an "as converted to common stock"

the years ended March 31, 2016 and 2015, the Company incurred $40,000 in Class A preferred stock dividends, respectively.

of March 31, 2016, there is $37,450 in accrued preferred stock dividends payable.

holders of the Series A Preferred Stock have the right to convert each share of preferred stock into a sufficient number of shares

6 unchanged sentences

convert into Common Stock and the remaining shares of Series A preferred Stock shall convert upon lapse of the applicable restrictions.

January 12, 2018, our Board of Directors agreed to amend Designation of the Series A Convertible Preferred Stock be amended

by changing the ratio for conversion, in Article IV, subparagraph (a), from .4% to .51% so that upon conversion the number of

shares of common stock to be exchanged shall equal 51% of then issued and outstanding common stock.

Rodriguez was under an employment agreement dated April 1, 2011 that expired on March 31, 2016, pursuant to which he

January 12, 2018, our Board of Directors agreed to amend Designation of the Series A Convertible Preferred Stock be amended by

changing the ratio for conversion, in Article IV, subparagraph (a), from .4% to .51% so that upon conversion the number of shares

of common stock to be exchanged shall equal 51% of then issued and outstanding common stock.

the twelve months ended March 31, 2017 and 2016, the Company incurred $40,000 respectively in Series A preferred stock dividends,

and paid $1,000 and $35,500 for the twelve months ended March 31, 2017 and 2016 respectively.

As of March 31, 2017 and 2016, the

accrued balance due Mr.

Rodriguez was $76,450 and $37,450 respectively.

The liquidation preference as of March 31, 2017 and March

31, 2016 was $576,450 or $5,764.50 per share and $537,450 or $5,374.50 per share.

Rodriguez was under an employment agreement dated April 1, 2015 that expires on March 31, 2019, pursuant to which he

was compensated at an annual rate of $48,000.

We extended this agreement for another year.

During the fiscal year

ended March 31, 2016, we paid Mr.

Rodriguez $50,547, and accrued $49,202.

During the fiscal year ending March 31, 2015,

Rodriguez $44,500, and accrued $48,000.

During the fiscal year ended March 31, 2017, we paid Mr.

$35,700, and accrued $49,800.

During the fiscal year ending March 31, 2016, we paid Mr.

Rodriguez $50,457, and

accrued $49,202.

The balance due Mr.

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of Designation Series B Preferred Stock*

Certificate of Designation AFS Series A Preferred Stock

of Designation AFS Series A Preferred Stock*

Note between the Company and Carebourn Capital, LLC dated January 29, 2018 in the amount of $230,000*

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Groove Botanicals,

August 28, 2018

January 11, 2019

/s/ Kent Rodriguez

9 unchanged sentences

Rene Häusler

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

the Shareholders and Board of Directors of

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING

To the Shareholders and Board of Directors

Botanicals Inc.

on the Financial Statements

have audited the accompanying consolidated balance sheets of Groove Botanicals Inc.

(formerly known as Avalon Oil &

Gas, Inc.) (the “Company”) as of March 31, 2016 and 2015, the related consolidated statements of

operations, changes in equity and cash flows for each of the two years in the period ended March 31, 2016, and the related

notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements

present fairly, in all material respects, the financial position of the Company as of March 31, 2016 and 2015, and the

results of its operations and its cash flows for each of the two years in the period ended March 31, 2016, in conformity with

accounting principles generally accepted in the United States of America.

The accompanying

consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

As more fully

described in Note 1, the Company has a significant working capital deficiency, has incurred significant losses and needs to raise

additional funds to meet its obligations and sustain its operations.

These conditions raise substantial doubt about the Company's

ability to continue as a going concern.

Opinion on the Financial

We have audited the accompanying

consolidated balance sheets of Groove Botanicals Inc.

(formerly known as Avalon Oil & Gas, Inc.) (the “Company”)

as of March 31, 2017 and 2016, the related consolidated statements of operations, changes in equity and cash flows for each of

the two years in the period ended March 31, 2017, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of

March 31, 2017 and 2016, and the results of its operations and its cash flows for each of the two years in the period ended March

31, 2017, in conformity with accounting principles generally accepted in the United States of America.

Going Concern

The accompanying consolidated

financial statements have been prepared assuming that the Company will continue as a going concern.

As more fully described in

Note 1, the Company has a significant working capital deficiency, has incurred significant losses and needs to raise additional

funds to meet its obligations and sustain its operations.

These conditions raise substantial doubt about the Company's ability

to continue as a going concern.

Management's plans in regard to these matters are also described in Note 1.

The consolidated

financial statements do not include any adjustments that might result from the outcome of this uncertainty.

These financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on

the Company's financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting

Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits

to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial

As part of our audits we are required to obtain an understanding of internal control over financial reporting but not

for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.

we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial

statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining,

on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating

the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of

the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

The consolidated financial

statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility

of the Company's management.

Our responsibility is to express an opinion on the Company's financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB")

and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable

rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with

the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether

the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have,

nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits we are required

to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the

effectiveness of the Company's internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to

assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures

that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures

in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made

by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a

reasonable basis for our opinion.

/s/ Bernstein & Pinchuk LLP

2 unchanged sentences

New York, New York

August 28, 2018

Botanicals, Inc.

Balance Sheets

and cash equivalents

receivable, net of allowance for doubtful accounts of $28,741 and $0

and prepaid expenses

from joint interests, net of allowance for doubtful accounts of $153,209 and $131,236

January 11, 2019

Groove Botanicals, Inc.

Consolidated Balance Sheets (Continued)

Current Assets:

and equipment, net

oil & gas properties

oil & gas properties, net

property rights, net

The accompanying notes are an integral part of these financial statements.

Botanicals, Inc.

Balance Sheets (Continued)

payable and accrued liabilities

payroll - related parties

liabilities to joint interest

payable - related party

payable, net of discount

Cash and cash equivalents

Total current assets

Property and equipment, net

Unproven oil & gas properties

Producing oil & gas properties, net

Liabilities and Equity

Current Liabilities:

asset retirement obligation (ARO) liability

and contingencies

stock, Series A, $.10 par value, 1,000,000 shares authorized;

100 shares issued and outstanding stated at redemption value,

as of March 31, 2016 and March 31, 2015, liquidation preference of $537,450 and 532,950 as of March 31, 2016 and 2015

stock, Series B, $.10 par value, 2,000 shares authorized;

1,983 shares issued and 1,625 shares issued and outstanding stated

at redemption value as of March 31, 2016 and March 31, 2015, liquidation preference of $1,983,000 and 1,625,000 as of March

31, 2016 and 2015

stock, $.001 par value:

200,000,000 shares authorized 18,198,062 and 16,548,062 shares issued and outstanding at March 31,

2016 and March 31, 2015, respectively

paid in capital

Accounts payable and accrued liabilities

Accrued payroll - related parties

Dividends payable

Dividends payable - related parties

Accrued liabilities to joint interest

Notes payable - related party

Notes payable, net of discount

Total current liabilities

Accrued asset retirement obligation (ARO) liability

Total Liabilities

Commitments and contingencies

Preferred stock, Series A, $.10 par value, 1,000,000 shares authorized;

100 shares issued and outstanding stated at redemption value, as of March 31, 2017 and and March 31, 2016, respectively, liquidation preference of $576,450 And $537,450

Preferred stock, Series B, $.10 par value, 2,000 shares authorized;

1,983 and 1,983 shares issued and outstanding stated at redemption value as of March 31, 2017 and and March 31, 2016, respectively, liquidation preference of $2,326,526 and $1,983,000

Common stock, $.001 par value:

200,000,000 shares authorized 18,198,062 and 18,198,062 shares issued and outstanding at March 31, 2017 and March 31, 2016, respectively

Additional paid in capital

Accumulated deficit

(34,012,256 )

(33,610,746 )

Stockholders (Deficit) Equity

Non-controlling

(Deficit) Equity

Liabilities and Equity

accompanying notes are an integral part of these financial statements.

Total stockholders' deficit

Non-controlling interest

Total deficit

Total Liabilities and Equity

The accompanying notes are an integral part of these financial statements.

Botanicals, Inc.

2 unchanged sentences

the year ended

operating expense, severance taxes and ARO accretion

operating expense, severance taxes

general and administrative expenses

based compensation

Depreciation,

3 unchanged sentences

on settlement of debt

on conversion of dividends payable

miscellaneous income

(Loss) before income tax

other income (expense)

before income tax

for income taxes

(loss) Income

$ (2,503,934 )

net loss attributable to noncontrolling interests

income (loss) attributable to the Company

loss attributable to the Company

$ (2,503,835 )

stock dividends

income (loss) attributable to common shareholders

loss attributable to common shareholders

$ (2,711,873 )

3 unchanged sentences

Botanicals, Inc.

Statement of Cash Flows

Statements of Cash Flows

the year ended

1 unchanged sentence

flows from operating activities:

(loss) income

$ (2,503,934 )

to reconcile net loss to net cash used in operating activities:

stock issued for services

to reconcile net loss to net cash used

consulting services

for allowances for doubtful accounts

stock issued for services services

for allowance for doubtful accounts

on extinguishment of debt

on the reduction of dividends payable

issued for reduction of interest on notes payable

issued for licensing fees

Depreciation,

depletion, and amortization

and ARO liability

change in operating assets and liabilities:

payable and other accrued expenses

to related party

retirement obligation accretion

payable - related party

cash used in operating activities

flows from investing activities:

on the purchase of additional assets

of property and equipment

of oil producing properties

payments received on notes receivable

cash provided by (used in) investing activities

cash provided by investing activities

flows from financing activities:

from advances from related party

on notes payable

from notes payable

Non-controlling

interest stock sale

stock B issued for cash

paid on preferred stock

cash provided by financing activities

accompanying notes are an integral part of these financial statements.

Botancials, Inc.

Statement of Cash Flows (Continued)

Botanicals, Inc.

Statements of Cash Flows (Continued)

the year ended

1 unchanged sentence

decrease in cash and cash equivalents

and cash equivalents at beginning of period

and cash equivalents at end of period

and cash equivalents at beginning of year

and cash equivalents at end of year

disclosures of cash flow information:

paid during the period for:

paid during the year for:

stock issued in exchange for consulting services

stock issued in exchange for licenses

stock issued for the conversion of dividends payable

stock issued for conversion of note payable, accrued interest, and assumption of debt

12 unchanged sentences

shares issued in exchange for notes payable

stock issued for consulting services

stock issued for cash

stock issued in exchange for consulting services

stock issued for licenses

stock issued for consulting services

stock issued in exchange for notes payable

stock issued in exchange for dividends payable

at March 31, 2015

$ (30,898,873 )

shares issued in exchange for notes payable

stock issued for consulting services

stock issued for cash

stock issued for cash (AFS Holdings, Inc.)

8 unchanged sentences

$ (33,610,746 )

stock issued for cash (AFS Holdings, Inc.)

stock issued for consulting service (AFS Holdings, Inc.)

at March 31, 2017

$ (34,012,256 )

accompanying notes are an integral part of these financial statements.

100 unchanged sentences

our success is dependent upon our ability to generate revenues from the sale of our CBD skin care products.

Reclassifications

prior year amounts have been reclassified to conform with current year presentation, specifically the classification of asset

retirement obligation accretion and depreciation expenses which were included in Lease operating expense, severance taxes as of

March 31, 2016 and in depreciation, depletion and amortization as of March 31, 2017.

preparation of financial statements in conformity with generally accepted accounting principles generally accepted in the United

39 unchanged sentences

and administrative costs associated with such activities.

During the year ended March 31, 2016 no acquisition costs were capitalized.

the year ended March 31, 2015, we capitalized $120,000 for the purchase of the Kensington Energy Assets.

Oil and natural

gas properties are reviewed for recoverability at least annually or when events or changes in circumstances indicate that its

carrying value may exceed future undiscounted cash inflows.

Under the full cost method of accounting, a ceiling test is performed

on a quarterly basis.

The full cost ceiling test is an impairment test prescribed by SEC Regulation S-X Rule 4-10.

test determines a limit on the book value of oil and natural gas properties.

The capitalized costs of proved oil and natural gas

properties, net of accumulated depletion in the Company’s Consolidated Balance Sheets, may not exceed the estimated future

net cash flows from proved oil and natural gas reserves, excluding future cash outflows associated with settling asset retirement

obligations that have been accrued in the Company’s Consolidated Balance Sheets, using the unweighted average first day

of the month commodity sales prices for the previous twelve months (adjusted for quality and basis differentials), held constant

for the life of production, discounted at 10%, plus the cost of unevaluated properties and major development projects excluded

from the costs being amortized.

If capitalized costs exceed this limit, the excess is charged to expense.

As of March 31, 2016

and 2015, the Company impaired $128,462 in Proven Oil and Gas Properties and $1,690,183 in Unproved Oil and Gas Properties and

- 0- respectively.

During the years ended March 31, 2017 and March 31, 2016 no acquisition

costs were capitalized.

Oil and natural gas properties are reviewed for recoverability at least annually or when

events or changes in circumstances indicate that its carrying value may exceed future undiscounted cash inflows.

Under the full

cost method of accounting, a ceiling test is performed on a quarterly basis.

The full cost ceiling test is an impairment test

prescribed by SEC Regulation S-X Rule 4-10.

The ceiling test determines a limit on the book value of oil and natural gas properties.

The capitalized costs of proved oil and natural gas properties, net of accumulated depletion in the Company’s Consolidated

Balance Sheets, may not exceed the estimated future net cash flows from proved oil and natural gas reserves, excluding future

cash outflows associated with settling asset retirement obligations that have been accrued in the Company’s Consolidated

Balance Sheets, using the unweighted average first day of the month commodity sales prices for the previous twelve months (adjusted

for quality and basis differentials), held constant for the life of production, discounted at 10%, plus the cost of unevaluated

properties and major development projects excluded from the costs being amortized.

If capitalized costs exceed this limit, the

excess is charged to expense.

As of March 31, 2017 and 2016, the Company impaired $128,462 in Proven Oil and Gas Properties and

$1,690,183 in Unproven Oil and Gas Properties.

BOTANICAL, INC.

32 unchanged sentences

Company impaired $21,292 for the year ended March 31, 2016.

There were not any impairment loss for the fiscal year ended

March 31, 2015.

There were noimpairment loss for the fiscal year ended March

the sum of the expected cash flows be less than the carrying amount of assets being evaluated, an impairment loss would be recognized.

72 unchanged sentences

Accounting Standards

August 2014, the FASB issued ASU No.

2014-15, Presentation of Financial Statements –

Going Concern (Subtopic 205-40):

of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”).

ASU 2014-15 provides

guidance about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability

to continue as a going concern and sets rules for how this information should be disclosed in the financial statements.

is effective for annual periods ending after December 15, 2016 and interim periods thereafter.

The Company adopted ASU 2014-15

prospectively for the annual period ending December 31, 2016.

Pursuant to ASU 2014-15, the Company is required to consider whether

there are adverse conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern

within one year after the date that the financial statements are issued and the probability that management’s plans will

mitigate the adverse conditions or events (if any).

Adverse conditions or events would include, but not be limited to, negative

financial trends (such as recurring operating losses, working capital deficiencies, or insufficient liquidity), a need to restructure

outstanding debt to avoid default, and industry developments (for example commodity price declines and regulatory changes).

May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

2014-09, Revenue from Contracts with Customers, which was subsequently modified in August 2015 by ASU No.

2015-14, Revenue

from Contracts with Customers:

Deferral of the Effective Date.

The core principle of ASU No.

2014-09 is that companies should

recognize revenue when the transfer of promised goods or services to customers occurs in an amount that reflects what the company

expects to receive.

It requires additional disclosures to describe the nature, amount, timing and uncertainty of revenue and cash

flows from contracts with customers.

In 2016, the FASB issued additional ASUs that clarify the implementation guidance on principal

versus agent considerations (ASU 2016-08), on identifying performance obligations and licensing (ASU 2016-10), and on narrow-scope

improvements and practical expedients (ASU 2016-12) as well as on the revenue recognition criteria and other technical corrections

(ASU 2016-20).

These new standards will identify performance obligations and narrow aspects on achieving core principle.

is currently evaluating the impact the adoption of this guidance may have on its financial statements.

The Company is an “emerging

growth company,”

as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”).

Under the JOBS

Act, emerging growth companies (“EGCs”) can delay adopting new or revised accounting standards issued subsequent to

the enactment of the JOBS Act until such time as those standards apply to private companies.

Therefore, the Company will not be

subject to the same new or revised accounting standards as public companies that are not EGCs.

The Company anticipates adopting

this new guidance on January 1, 2019 with the modified retrospective approach and plans on giving additional updates on its progress

and further conclusions.

January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10):

Recognition and Measurement of Financial

Assets and Financial Liabilities, which requires that equity investments, except for those accounted for under the equity method

or those that result in consolidation of the investee, be measured at fair value, with subsequent changes in fair value recognized

in net income.

However, an entity may choose to measure equity investments that do not have readily determinable fair values at

cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical

or a similar investment of the same issuer.

It also impacts the presentation and disclosure requirements for financial instruments.

It is effective for public business entities for annual periods, and interim periods within those annual periods, beginning after

December 15, 2017, while for EGCs the amendment will become effective for fiscal years beginning after December 15, 2018.

adoption is permitted only for certain provisions.

The Company is in the process of evaluating the impact of adoption of this

guidance on the Company’s consolidated financial statements and will adopt this guidance since January 1, 2019.

BOTANICAL, INC.

8 unchanged sentences

as Receivable from Joint Interests.

At March 31, 2016 and 2015, the amount of these receivables is $153,209 and $151,236,

respectively.

During the year ended March 31, 2016, the Company deemed the collectability of the receivable from joint

interests in the amount of $153,209, as unlikely.

At March 31, 2016 and March 31, 2017 the amount of these receivables is $153,209.

the year ended March 31, 2016 and March 31, 2017, the Company deemed the collectability of the receivable from joint interests

in the amount of $153,209, as unlikely.

DEPOSITS AND PREPAID EXPENSES

the years ended March 31, 2016 and 2015 the Company has advanced $- 0- and $279,400 toward the purchase of properties.

wrote off the $279,000 in deposits of $279,400 on March 31, 2016.

the year ended March 31, 2015 the Company incurred prepaid consulting fees in the amount of $100,000 which was

being amortized over 36 months.

In November 2015 the Company incurred prepaid consulting fees to Rene Haeusler, a director

of the company, in the amount of $50,000 which is being amortized over 48 months.

the years ended March 31, 2017 and 2016 the Company advanced $- 0- toward the purchase of properties.

wrote off $279,400 in deposits of $279,400 on March 31, 2016.

the year ended March 31, 2015 the Company incurred prepaid consulting fees in the amount of $100,000 which was being amortized

over 36 months.

In November 2015 the Company incurred prepaid consulting fees to Rene Haeusler, a director of the company, in

the amount of $50,000 which is being amortized over 48 months.

Amortization through March 31, 2016 was $37,131.

We wrote off the remaining balance of our prepaid consulting

fees in the on March 31, 2016.

wrote off the remaining balance of our prepaid consulting fees in the on March 31, 2016.

consulting fees

11 unchanged sentences

accumulated amortization

expense for the years ended March 31, 2016 and 2015 was $31,938 and $42,851.

impaired the remaining $21,292 for the year ended March 31, 2016.

expense for the years ended March 31, 2016 $31,938.

We impaired the remaining $21,292 for the year ended March 31, 2016.

BOTANICAL, INC.

17 unchanged sentences

May 8, 2006, the Company entered into a convertible note payable agreement with a shareholder in the amount of $100,000.

The note carries an interest rate of 10% per annum and matures of November 8, 2006.

note holder has the right to convert the note and accrued interest at a rate of $0.01 per share.

this conversion feature was treated as a loan discount for the full $100,000 of the loan and was amortized to interest

expense over the life of the loan.

During the year ended March 31, 2016, the Company issued 700,000 shares of

common stock for the conversion of $100 of principal.

Interest in the amount of $175 and $180 was accrued on this note

during the year ended March 31, 2016 and 2015, respectively.

note carries an interest rate of 10% per annum and matures of November 8, 2006.

The note holder has the right to

convert the note and accrued interest at a rate of $0.01 per share.

The value of this conversion feature was treated

as a loan discount for the full $100,000 of the loan and was amortized to interest expense over the life of the loan.

the year ended March 31, 2016, the Company issued 700,000 shares of common stock for the conversion of $100 of principal.

Interest in the amount of of $170 and $175 were accrued on this note during the year ended March 31, 2017 and 2016,

respectively.

The maturity of this note has been extended until April 1, 2018.

The outstanding principal balance and all outstanding interest was converted into 500,000 shares on June 15,

The outstanding principal balance and all outstanding

interest was converted into 500,000 shares on June 15, 2018.

November 11, 2008, the Company issued a convertible promissory note to an investor in the amount of $50,000.

52 unchanged sentences

were settled in March 2018 for $5,000.

January 1, 2011 the Company issued a promissory note payable in the amount of $250,000.

This note bears interest

at a rate of 8% per annum and matured on January 1, 2014, and were extended until April 1, 2015.

The principal

amount of the note and accrued interest are convertible into shares of the Company’s common stock at a price of $0.01

A beneficial conversion feature in the amount of $95,000 was recorded as a discount to the note and

is being amortized to interest expense.

A discount of $-0- and $94,050 was deducted for the years ended March 31, 2015 and

2014 respectively.

Interest in the amount of $4,010 and $17,945 was accrued on this note during the twelve months

ended March 31, 2015 and 2014, respectively.

Accrued interest was $5,858 and $1,847 at March 31, 2015.

During the year ended

March 31, 2016, we settled $50,000 of this note plus accrued interest for $10,000 and issued 25 shares of our Series B Preferred

Stock for the remaining $25,000 plus accrued interest

BOTANICAL, INC.

25 unchanged sentences

The Series A Preferred Stock provides for voting rights on an "as converted to common stock"

the years ended March 31, 2016 and 2015, the Company incurred $40,000 in Class A preferred stock dividends.

holders of the Series A Preferred Stock have the right to convert each share of preferred stock into a sufficient number of shares

9 unchanged sentences

of common stock to be exchanged shall equal 51% of then issued and outstanding common stock.

the years ended March 31, 2016 and March 31, 2017, the Company incurred $40,000 in Series A preferred stock dividends, and

paid $1,000 and $35,500 for years ended March 31, 2017 and March 31, 2016, respectively.

As of March 31, 2017 and March 31, 2016,

the accrued balance due Mr.

Rodriguez was $76,450 and $37,450 respectively.

The liquidation preference as of March 31, 2016 and

March 31, 2017 was $576,450 and $537,450 or $5,764.50 and $5,374.50 per share respectively.

the years ended March 31, 2017 and 2016, the Company charged to operations the amount of $49,800 and $49,202 in annual salary

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of March 31, 2017 and 2016, the balances of accrued and unpaid salaries were $219,562 and $205,462.

In March, 2013, our Board of Directors authorized

the issuance of 2,000 shares of Series B Preferred Stock, par value $0.10 per share (the "Series B Preferred Stock").

face amount of share of the Series B Preferred Stock is $1,000.

As of March 31, 2016 and 2015, the Company has 1,983

and 1,625 shares of Series B preferred stock respectively issued and outstanding.

The liquidation preference as of March 31, 2016

and 2015 was $1,983,000 and $1,625,000 or $1,000.00 per share.

The Series B Preferred Stock accrues dividends

at the rate of 9% per annum on the original purchase price for the shares.

These dividends are payable annually, beginning in

January 2014.

We are prohibited from paying any dividends on our Common Stock until all accrued dividends are paid on our Series

B Preferred Stock.

The Series B Preferred Stock ranks junior to the Series A Preferred Stock owned by our President

and Chief Executive Officer, as to Dividends and to a distribution of assets in the event of a liquidation of assets.

The Holders of Series B Preferred Stock do

not have any voting rights and their consent is not required to take any sort of corporate action.

In November 2015 we issued 50 shares Series

B Preferred Stock for consulting services to Rene Haeusler, a director of the Company, for $50,000.

As of March 31, 2016, the

balances of related party was $0.

For details, please refer to Note 3.

March, 2013, our Board of Directors authorized the issuance of 2,000 shares of Series B Preferred Stock, par value $0.10 per share

(the "Series B Preferred Stock").

The face amount of share of the Series B Preferred Stock is $1,000.

of March 31, 2017 and 2016, the Company has 1,983 and 1,983 shares of Series B preferred stock respectively issued and outstanding.

The liquidation preference as of March 31, 2017 was $2,326,526 or $1,173.24 per share.

Series B Preferred Stock accrues dividends at the rate of 9% per annum on the original purchase price for the shares.

These dividends

are payable annually, beginning in January 2014.

We are prohibited from paying any dividends on our Common Stock until all accrued

dividends are paid on our Series B Preferred Stock.

The Series B Preferred Stock ranks junior to the Series A Preferred

Stock owned by our President and Chief Executive Officer, as to Dividends and to a distribution of assets in the event of a liquidation

Holders of Series B Preferred Stock do not have any voting rights and their consent is not required to take any sort of corporate

income taxes result from the temporary difference arising from the use of accelerated depreciation methods for income tax purposes

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changes in the Company's ownership, the Company's future use of its existing net operating losses may be limited.

reconciliation between the actual income tax expense and income taxes computed by applying the statutory Federal and state income

tax rates to income from continuing operations before income taxes is as follows:

“expected”

income tax benefit at approximately 34%

$ (10,802,086 )

$ (10,471,510 )

in valuation allowance

income taxes arise from the temporary differences between financial statement and income tax recognition of net operating losses.

These loss carryovers are limited under the Internal Revenue Code should a significant change in ownership occur.

operating (loss) income

deferred tax asset

income taxes arise from the temporary differences between financial statement and income tax recognition of net operating losses.

These loss carryovers are limited under the Internal Revenue Code should a significant change in ownership occur.

March 31, 2017 and March 31, 2016, the Company had approximately $34,047,136 and income of $33,610,746 respectively, in unused

federal net operating loss carryforwards, which begin to expire principally in the year 2029.

A deferred tax asset at each date

of approximately $14,119,347 and $13,938,376 resulting from the loss carryforwards has been offset by a 100% valuation allowance.

The change in the valuation allowance for the period ended March 31, 2017 and 2016 was approximately $180,971 and $336,107.

Federal statutory graduated rate

income tax rate, net of federal benefit

Net operating

operating loss for which no tax benefits is currently available

STOCKHOLDERS’

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and paid $1,000 and $35,500 for the twelve months ended March 31, 2017 and 2016 respectively.

As of March 31, 2016 and 2015,

the accrued balance due Mr.

As of March 31, 2016 and 2015, the

accrued balance due Mr.

Rodriguez was $76,450 and $37,450 respectively.

The liquidation preference as of March 31, 2016 and

March 31, 2015 was $537,450 or $5,374.5 per share and $532,950 or $5,329.5 per share.

The liquidation preference as of March 31, 2017 and March

31, 2016 was $576,450 or $5,764.50 per share and $537,450 or $5,374.50 per share.

100 shares of Series A Preferred Stock, issued to Mr.

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of March 31, 2017 and 2016, the Company has 1,983 and 1,983 shares of Series B preferred stock respectively issued and outstanding.

The liquidation preference as of March 31, 2016 and 2015 was $1,983,000 and $1,625,000 or $1,000.00 per share.

The liquidation preference as of March 31, 2017 and 2016 were $2,326,526 or $1,173.24 per share and 1,983,000 or $1,000.00

per share, respectively.

Series B Preferred Stock accrues dividends at the rate of 9% per annum on the original purchase price for the shares.

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B Preferred Stock Issuances during the year ended March 31, 2017:

June 2015 we exchanged 25 shares Series B Preferred Stock for $25,000 of notes payable.

June 2015 we issued 100 Shares of Series B Preferred Stock to an accredited investor for $100,000.

September 2015 we issued 75 Shares of Series B Preferred Stock to an accredited investor for $75,000.

November 2015 we issued 50 shares Series B Preferred Stock for consulting services for $50,000.

December 2015 we issued 85 Shares of Series B Preferred Stock to an accredited investor for $85,000.

March 2016 we issued 23 Shares of Series B Preferred Stock to an accredited investor for $23,000.

did not issue any Series B Preferred Shares during the year ended March 31, 2017.

March 2018 we issued 2,015000 Shares of Common Stock for all accrued interest as of March 31, 2018, on the outstanding 1,625 shares

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are currently 200 shares of AFS Series A Preferred Stock outstanding.

As of March 31, 2016, the liquidation preference is $53,000

or $1,060 per share.

Accrued interest as of March 31, 2017 is $14,037.

March 31, 2017, the liquidation preference is $214,037 or $1070.19 per share.

Holders of AFS Series A Preferred Stock do not have any voting rights and their consent is not required to take any sort of corporate

Series A Preferred Stock Issuances during the year ended March 31, 2017:

October 13, 2015 we issued 50 shares of AFS Series A Preferred Stock to an unaffiliated accredited investor for $50,000.

December 2016, the Company issued 100 shares of AFS Series A Preferred Stock for $100,000 in cash to a non-affiliated accredited

investor, and 50 shares to a non affiliated accredited investor for Consulting Services.

BOTANICAL, INC.

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and 2016, the Company has 18,198,062 and 18,198,062 shares of common stock issued and outstanding.

stock issuances during the year ended March 31, 2015:

April 25, 2014, the Company issued 200,000 shares of common stock to a consultant, the value of these shares in the amount

of $14,000, or $0.07 per share was charged to operations, and was valued at closing bid price of the Company's common stock on

the date the Consulting Agreement was executed by the Company.

December 1, 2014, the Company issued 300,000 shares of common stock for a technology licensing agreement dated December 1, 2014, the

value of these shares in the amount of $15,000, or $0.05 per share was charged to operations, and was valued at the middle of

the closing bid price and the closing offering price of the Company's common stock on the date the Consulting Agreement was executed

by the Company

December 15, 2015, the Company issued 650,000 shares of common stock in exchange for a $150,000 promissory note payable and $90,000

of accrued interest.

The value of these shares in the amount of $32,500, or $0.05 per share and was valued at closing bid

price of the Company's common stock on the date the Agreement was executed by the Company.

$207,500 was treated as a gain from

this transaction.

December 26, 2014, the Company issued 1,700,000 shares of common to a consultant, the value of these shares in the amount

of $85,000, or $0.05 per share was charged to operations, and was valued at the middle of the closing bid price and the closing

offering price of the Company's common stock on the date the Consulting Agreement was executed by the Company.

March 25, 2015, the Company issued 1,540,000 shares of common stock to the holders of Series B Preferred Stock to pay all accrued

interest as of March 31, 2015.

The value of these shares in the amount of $61,600, or $.04 per share.

March 27, 2015, the Company issued 500,000 shares of common stock along with $6,000, in exchange for a $150,000 promissory note

payable and $90,000 of accrued interest.

The value of these shares in the amount of $20,000 or $0.04 per share, and were

valued at closing bid price of the Company's common stock on the date the Agreement was executed by the Company, $215,000 was

treated as a gain from this transaction.

stock issuances during the year ended March 31, 2016:

April 2, 2015 we issued 300,000 shares of our Common Stock to our directors for their services.

The shares were valued at $12,000

or $0.04 per share and were valued based on the midpoint between the closing bid and offer price of the Company's common stock

on the date the shares were issued.

June 25, 2015, the company issued 650,000 shares of Common Stock, paid $5,000 in cash and issued a $5,000 promissory note for

settlement of an account payable of $280,972.06.

The shares were valued at $26,000 or $0.04 per share.

The value of the shares

was based on the closing bid price of the Company's common stock on the date the Agreement was executed by the Company.

was treated as a gain from this transaction.

November 9, 2015, the Company issued 700,000 shares of common stock for the conversion of a note payable and assumption of debt.

fair market value of these shares was $28,000 or $0.04 per share which was based on the current market value on the date of issuance.

$100 has been credited to the note payable, $830 to interest payable, and a loss of $27,070 was recognized on this conversion,

and was charged to operations.

Company did not issue any Common stock during the year ended March 31, 2017.

are no stock options outstanding.

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The net loss per share was $0.024 and $0.154 for March 31, 2017 and 2016.

AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

and contingencies through the date of these financial statements were issued have been considered by the Company and none were

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(1) Concentration

the year ended March 31, 2016, three customers, KROG Partners, Scissortail Energy and Ward Petroleum, individually accounted for

28%, 20% and 16% of the Company’s revenues, respectively.

For the year ended March 31, 2015, four customers, Scissortail

Energy, KROG Partners, Rockwell Energy and Swift Energy, individually accounted for 33%, 14%, 11% and 11% of the Company’s

revenues, respectively.

Except for the aforementioned customers, there was no other single customer who accounted for more than

10% of the Company’s revenues for the year ended March 31, 2016 and 2015.

the year ended March 31, 2017, four customers, Scissortail Energy, Avalon 2015-1 LP, Lexinta SA and Ward Petroleum, individually

accounted for 23%, 18%, 18% and 12% of the Company’s revenues, respectively.

Except for the aforementioned customers, there

was no other single customer who accounted for more than 10% of the Company’s revenues for the year ended March 31, 2017.

imputed income tax provision is hypothetical (at the statutory rate) and determined without regard to the Company's deduction

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estimates are generally less precise than other estimates presented in connection with financial statement disclosures.

as of March 31, 2014

of reserves-in-place

as of March 31, 2015

of reserves-in-place

as of March 31, 2016

of March 31, 2014

Purchase of reserves-in-place

as of March 31, 2015

of reserves-in-place

Purchase of reserves-in-place

Balance as of March 31, 2016

Purchase of reserves-in-place

Balance as of March 31, 2017

of March 31, 2014

Purchase of reserves-in-place

as of March 31, 2015

of reserves-in-place

Purchase of reserves-in-place

Balance as of March 31, 2016

Purchase of reserves-in-place

as of March 31, 2017

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measure of discounted net cash flows

weighted average oil wellhead price used in computing the Company's reserves were $42.10 per bbl and $80.60 per bbl at

March 31, 2016 and 2015, respectively.

The weighted average gas wellhead price used in computing the Company's reserves were

$1.824 and $3.34/mmbtu at March 31, 2016 and 2015, respectively.

The oil and gas pricing were calculated using the arithmetic

average of the price on the first day of each month that was received for each property during the previous fiscal

These prices were held constant throughout the economic life of the properties.

Previous year run

checks were used to determine the actual prices received.

weighted average oil wellhead price used in computing the Company's reserves were $42.36 per bbl and $42.10 per bbl at March 31,

2017 and 2016, respectively.

The weighted average gas wellhead price used in computing the Company's reserves were $2.06 and $1.824

/mmbtu at March 31, 2017 and 2016, respectively.

The oil and gas pricing were calculated using the arithmetic average of the price

on the first day of each month that was received for each property during the previous fiscal year.

These prices were

held constant throughout the economic life of the properties.

Previous year run checks were used to determine the actual

prices received.

following schedule contains a comparison of the standardized measure of discounted future net cash flows to the net carrying value

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measure of discount future net cash flows

natural oil and gas property, net of accumulated depreciation,

depletion, and amortization, including

natural oil and gas property, net of accumulated

depreciation, depletion, and amortization, including

measure of discount future net cash flows in excess of net carrying value of proved natural oil and gas properties

26 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures