What changed in this filing

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Item 1. Financial Statements

2021-08-03 compared with 2018-07-13 · 667 added, 377 removed, 202 unchanged (84% of the section changed)

ITEM 1 Financial Statements

GREY CLOAK TECH INC

BALANCE SHEETS

HEALTHY EXTRACTS INC.

CONSOLIDATED BALANCE SHEETS

CURRENT ASSETS

Accounts receivable

Note receivable

Accrued interest receivable

Total current assets

Fixed assets, net of accumulated depreciation of $45,944 and $36,895, respectively

Website, net of accumulated amortization of $8,540 and $4,002, respectively

Patents/Trademarks

Total other assets

LIABILITIES AND STOCKHOLDERS' DEFICIT

AND STOCKHOLDERS' DEFICIT

Accounts payable

Accounts payable - related party

Accrued liabilities

Notes payable

Notes payable - related party

Convertible debt, net of discount of $0.00 and $0.00, respectively

Convertible debt - related party, net of discount of $16,371 and $23,871, respectively

Convertible debt - related party, net of discount of $0.00 and $0.00,

Accrued interest payable

2 unchanged sentences

Total current and total liabilities

STOCKHOLDERS' DEFICIT

Preferred stock, $0.001 par value, 75,000,000 shares authorized,1,333,334 and 1,333,334 shares issued and outstanding, respectively

Common stock, $0.001 par value, 2,500,000,000 shares authorized, 469,012,760 and 224,605,587 shares issued and outstanding, respectively

STOCKHOLDERS' EQUITY (DEFICIT)

Preferred stock, $0.001 par value, 75,000,000 shares authorized,

none and none shares issued and outstanding, respectively

Common stock, $0.001 par value, 2,500,000,000 shares authorized,

317,302,410 and 121,610,085 shares issued and outstanding, respectively

Additional paid-in capital

Accumulated deficit

Total stockholders' deficit

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT

The accompanying notes are an integral

part of these financial statements.

GREY CLOAK TECH INC

STATEMENT OF OPERATIONS

FOR THE THREE MONTHS ENDED MARCH 31

(14,250,134 )

(12,956,498 )

Total stockholders' equity (deficit)

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

The accompanying notes are an integral part

of these unaudited consolidated financial statements.

HEALTHY EXTRACTS INC.

CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE THREE MONTHS ENDING MARCH 31, 2021

FOR THE 3 MONTHS ENDED

COST OF REVENUE

1 unchanged sentence

General and administrative

General and administrative - related party

Total operating expenses

1 unchanged sentence

Interest expense, net of interest income

Interest expense - related party

Change in fair value on derivative

Loss on extinguishment of debt

SBA Loan Forgiveness

Impairment of Assets

Gain on sale of asset

Total other income (expense)

Net loss before income tax provision

Income tax provision

Net gain/(loss) before income tax provision

NET GAIN/(LOSS)

$ (1,293,636 )

Loss per share - basic and diluted

Weighted average number of shares outstanding - basic and diluted

The accompanying notes are an integral

part of these financial statements.

GREY CLOAK TECH INC

STATEMENT OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31,

The accompanying notes are an integral part

of these unaudited consolidated financial statements.

HEALTHY EXTRACTS INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE MONTHS

ENDING MARCH 31,

Cash Flows from Operating Activities:

Net Gain/(Loss)

$ (1,293,636 )

Adjustments to reconcile net loss to net cash

1 unchanged sentence

Depreciation and amortization

Non-cash interest

Warrants issued for services

Non-cash compensation

Change in fair value on derivative liability

2 unchanged sentences

Accounts receivable

Prepaid expenses

Accrued interest receivable

1 unchanged sentence

Accounts payable - related party

Accrued payroll and taxes

Accrued liabilities

Accrued interest payable

2 unchanged sentences

Cash Flows from Investing Activities:

Purchase of fixed assets

Payments of note receivable

Cash flows used from Investing Activities:

Cash flows provided by (used in) Investing Activities:

Cash Flows from Financing Activities:

Purchase of BergaMet

Purchase of UBN

Proceeds from issuance of common stock

Proceeds from issuance of convertible debt,

net of discount of $32,917 and $42,000, respectively

Payments for repayment of convertible debt

Proceeds from issuance of noted payable

Proceeds from issuance of noted payable - related party

Payments for repayment of notes payable - related party

Net Cash provided by Financing Activities

Increase in cash

Increase (decrease) in cash

Cash at beginning of period

Cash at end of period

Supplemental disclosure of cash flow information of non-cash financing activities:

Beneficial conversion feature and warrants recognized as a discount

Conversion of debt for shares of common stock

Common stock issued in connection with debt conversion

Preferred stock issued for acquisition

The accompanying notes are an integral

part of these financial statements.

GREY CLOAK TECH INC

The accompanying notes are an integral part

of these unaudited consolidated financial statements.

HEALTHY EXTRACTS INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'

EQUITY (DEFICIT)

FOR THE YEAR ENDING DECEMBER 2021 AND 2020

Preferred Stock

Balance - December 31, 2019

$ (10,380,123 )

Issuance of shares acquisition of UBN

Issuance of common stock for debt conversion

Issuance of common stock for cash

Net (loss) gain for the period

Balance - December 31, 2020

$ (12,956,498 )

Issuance of common stock for cash

Issuance of common stock for debt

Issuance of common stock for services

Net (loss) gain for the period

Balance - December 31, 2021

$ (14,250,134 )

The accompanying notes are an integral part

of these unaudited consolidated financial statements.

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

March 31, 2021 and 2020

NOTE 1 –

ORGANIZATION AND DESCRIPTION

Grey Cloak Tech Inc.

ORGANIZATION AND DESCRIPTION OF BUSINESS

Healthy Extracts Inc.

(the “Company”)

was incorporated in the State of Nevada on December 19, 2014.

The Company was formed to provide cloud based software to detect

advertising fraud on the internet.

The Company has acquired Eqova Life Sciences and is transitioning it business towards marketing

and selling CBD oil products.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING

The Company has additionally acquired BergaMet NA, LLC and Ultimate Brian

Nutrients, LLC which markets and sells heath supplemental products.

On October 23, 2020, we changed our name from Grey Cloak Tech Inc.

to Healthy Extracts Inc.

to more accurately reflect our business.

We are currently waiting for The Financial Industry Regulatory Authority

(FINRA) to issue our Company a new ticker symbol before we file our 8-K for this change.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited

consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the

United States of America for interim financial statements and with the instructions to Form 10-Q and Article 8 of Regulation

S-X of the United States Securities and Exchange Commission (“SEC”).

Accordingly, they do not contain all

information and footnotes required by accounting principles generally accepted in the United States of America for annual

financial statements.

In the opinion of the Company’s management, the accompanying unaudited consolidated financial

statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial

position of the Company as of March 31, 2018 and the results of operations and cash flows for the periods presented.

results of operations for the three months ended March 31, 2018 are not necessarily indicative of the operating results

for the full fiscal year or any future period.

These unaudited consolidated financial statements should be read in

conjunction with the financial statements and related notes thereto included in the Company’s form 10-K for the year

ended December 31, 2017 filed with the SEC on June 8, 2018.

The accompanying unaudited consolidated financial

statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim

financial statements and with the instructions to Form 10-Q and Article 8 of Regulation S-X of the United States Securities and Exchange

Commission (“SEC”).

Accordingly, they do not contain all information and footnotes required by accounting principles generally

accepted in the United States of America for annual financial statements.

In the opinion of the Company’s management, the accompanying

unaudited consolidated financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present

the financial position of the Company as of March 31, 2021 and the results of operations and cash flows for the periods presented.

results of operations for the year ended March 31, 2021 are not necessarily indicative of the operating results for the full fiscal year

or any future period.

These unaudited consolidated financial statements should be read in conjunction with the financial statements and

related notes thereto included in the Company’s form 10-K for the year ended December 31, 2019 filed with the SEC on August 10,

Use of Estimates

The preparation of financial statements

in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities

The preparation of financial statements in

conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities

and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues

4 unchanged sentences

to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value.

GREY CLOAK TECH INC

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING

POLICIES (CONTINUED)

March 31, 2021 and 2020

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Accounts Receivables

Accounts receivables are recorded at the invoice

amount and do not bear interest.

Inventories consist of health supplements

held for sale in the ordinary course of business.

The Company uses the weighted average cost method to value its inventories at

the lower of cost or market.

An allowance for inventory was established in 2018 and is evaluated each quarter to determine if

all items are still sellable due to expiration dates.

As of March 31, 2021 and 2020, the total of inventory which was written

off as an inventory allowance was $1,808,904 and $748,972.

Property and Equipment

The Company’s property and equipment

are recorded at cost and depreciated using the straight-line method over the useful lives of the assets, generally from three

to seven years.

Upon sale or disposal of property and equipment, the related asset cost and accumulated depreciation or amortization

are removed from the respective accounts and any gain or loss is reflected in current operations.

Indefinite-Lived Intangible Assets

Indefinite-lived intangible assets established in

connection with business combinations consist of patents, trademarks, and trade names.

The impairment test for identifiable indefinite-lived

intangible assets consists of a comparison of the estimated fair value of the intangible asset with its carrying value.

If the carrying

value exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

With the combination of Ultimate Brain

Nutrients on April 3, 2020 the Company added a purchasing value of $315,604 in patents to its balance sheet.

As of March 31, 2021, the Company believes

that based upon qualitative factors, no impairment of indefinite-lived intangible assets is necessary.

In accordance with Goodwill and Other Intangible

Assets, goodwill is defined as the excess of the purchase price over the fair value assigned to individual assets acquired and

liabilities assumed and is tested for impairment at the reporting unit level on an annual basis in the Company's fourth fiscal

quarter or more frequently if indicators of impairment exist.

The performance of the test involves a two-step process.

step of the impairment test involves comparing the fair value of the Company's reporting units with each respective reporting

unit's carrying amount, including goodwill.

The fair value of reporting units is generally determined using the income approach.

If the carrying amount of a reporting unit exceeds the reporting unit's fair value, the second step of the goodwill impairment

test is performed to determine the amount of any impairment loss.

The second step of the goodwill impairment test involves comparing

the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill.

The Company sees the goodwill

to have a ten-year useful life.

No goodwill impairment indicators were present, for the goodwill listed on the books as of March

31, 2021, after working through our analysis of goodwill during the year ending March 31, 2021.

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021 and 2020

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The Company has determined that the method

applied represents the fair value of the asset group principally because the valuation of the intangibles with the asset group

is based on the anticipated cash flows related to the revenue stream from its customers.

The asset group excludes goodwill, long

term non-operational assets and liabilities and cash.

As such, the principal value from the asset group relates to the cash inflows

from its customers and the cash outflows required to service these customers.

The fair value for the asset group consists of the

value of net revenues:

computed using the income approach.

The key input to these computations

is the anticipated cash inflows from customers.

These valuations include 100% of the

cash inflows related to the customer base, and taking cash outflows into consideration.

value of working capital (including accounts receivable, inventory, accrued expenses,

and accounts payables).

Due to the short-term nature of the working capital, book value

has been determined to be fair value.

These accounts represent either avoided future

outflows (inventory, prepaids) or future cash flows (accrued expense, AP and AR) related

to customer sales.

value of five years of revenue (2020 to 2024):

we discounted our cash flows to the anticipated

cash projected to be received.

We also projected the anticipated cash outflows required

to service these customers.

If the asset group was to be valued as a whole, we would

expect an income approach based on the revenues being generated from the customers and

expenses required to service those customers, appropriately adjusted for the working

capital position.

The sum of these values reasonably approximates this approach.

The Company’s revenue streams align

directly with the intangibles, which were recorded as a result of the BergaMet acquisition in fiscal 2019.

For purposes of the

Step 2 recoverability test under ASC 360 subsection 2.3., the net revenues from BergaMet customers base were used.

stream fairly reflects anticipated future cash flows;

accordingly, the intangibles associated with these revenue streams have

been tested with the expected cash flows.

Due to the purchase of Ultimate Brian Nutrients,

LLC being a related party transaction and the new division recording no revenue as of June 30, 2020, the Company found the goodwill

to be impaired.

Due to the impairment the Company expensed the goodwill related to the purchase as of June 30, 2020.

Revenue Recognition

We recognize revenue when all of the following

conditions are satisfied:

(1) there is persuasive evidence of an arrangement;

(2) the product or service has been provided

to the customer;

(3) the amount of fees to be paid by the customer is fixed or determinable;

and (4) the collection of

our fees is probable.

The Company will record revenue when

it is realizable and earned and the computer programming services or marketing services have been rendered to the customers.

Additionally,

the Company will record revenue from the sale of its software when the software is delivered to the customer or it will be recognized

ratably throughout the term of the contract.

The Company records revenue upon shipment

of the products to the customers.

Beginning January 1, 2019, the Company implemented

ASC 606, Revenue from Contracts with Customers.

Although the new revenue standard is expected to have an immaterial

impact, if any, on our ongoing net income, we did implement changes to our processes related to revenue recognition and the control

activities within them.

These included the development of new policies based on the five-step model provided in the new

revenue standard, ongoing contract review requirements, and gathering of information provided for disclosures

The Company recognizes revenue and cost of goods

sold from product sales or services rendered when control of the promised goods are transferred to our clients in an amount that reflects

the consideration to which we expect to be entitled in exchange for those goods and services.

Our recognizes revenue policy includes

all sales channels which include the Company website channel or any other selling channel like Amazon, doctors’

offices, and walk-in

To achieve this core principle, we apply the following five steps:

identify the contract with the client, identify

the performance obligations in the contract, determine the transaction price, allocate the transaction price to performance obligations

in the contract and recognize revenues when or as the Company satisfies a performance obligation.

The Company recognizes revenue and cost of

goods sold from each sale upon shipment of the promised goods to the customers.

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021 and 2020

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Concentration

is no concentration of revenue for the three months ended March 31, 2018.

One customer accounted for 100% of total revenue

earned during the three months ended March 31, 2018.

The Company accounts for income taxes

using the asset and liability method in accordance with ASC 740, “Accounting for Income Taxes”.

There is no concentration

of revenue for the months ended March 31, 2020 and the months ended March 31, 2021 because the revenue was earned from multiple

The Company accounts for income taxes using

the asset and liability method in accordance with ASC 740, “Accounting for Income Taxes”.

The asset and liability

method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences

between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards.

tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences

are expected to reverse.

The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed

more likely than not to be realized.

As of March 31, 2018, the Company did not have any amounts recorded pertaining to uncertain

tax positions.

method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary

differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry

Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect

when the differences are expected to reverse.

The Company records a valuation allowance to reduce deferred tax assets to the amount

that is believed more likely than not to be realized.

For the period ending March 31, 2020 and March 31, 2021, the Company did

not have any amounts recorded pertaining to uncertain tax positions.

Fair Value Measurements

The Company adopted the provisions of

ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting

The Company adopted the provisions of ASC

Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting

pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements.

The estimated fair value of certain

financial instruments, including cash and cash equivalents are carried at historical cost basis, which approximates their fair

values because of the short-term nature of these instruments.

GREY CLOAK TECH INC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING

POLICIES (CONTINUED)

The estimated fair value of certain financial

instruments, including cash and cash equivalents are carried at historical cost basis, which approximates their fair values because

of the short-term nature of these instruments.

ASC 820 defines fair value as the exchange

1 unchanged sentence

market for the asset or liability in an orderly transaction between market participants on the measurement date.

ASC 820 also establishes

a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable

inputs when measuring fair value.

establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of

unobservable inputs when measuring fair value.

ASC 820 describes three levels of inputs that may be used to measure fair value:

6 unchanged sentences

The derivative liability in connection with

the conversion feature of the convertible debt, classified as a Level 3 liability, is the only financial liability measure at fair

value on a recurring basis.

the conversion feature of the convertible debt, classified as a Level 3 liability, is the only financial liability measure at

fair value on a recurring basis.

The change in Level 3 financial instrument

1 unchanged sentence

Balance, January 1, 2021

Issued during the three months ended March 31, 2018

Issued during the year ended March 31, 2021

Change in fair value recognized in operations

Converted during the three months ended March 31, 2018

Converted during the year ended March 31, 2021

Balance, March 31, 2021

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021 and 2020

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards

Board (“FASB”) issued ASU No.

2014-09, Revenue from Contracts with Customers (Topic 606).

ASU 2014-09 amends the guidance

for revenue recognition to replace numerous, industry specific requirements and converges areas under this topic with those of

the International Financial Reporting Standards.

The ASU implements of five–step process for customer contract revenue recognition

that focuses on transfer of control, as opposed to transfer of risk and rewards.

The amendment also requires enhanced disclosures

regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers.

Other major provisions

include the capitalization and amortization of certain contract cost, ensuring the time value of money is considered in the transaction

price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances.

The amendments in this ASU are effective for reporting period beginning after December 15, 2016, and early adoption is prohibited.

Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption.

The Company’s revenues are recognized

when control of the promised goods or services is transferred to our clients (upon shipment of goods) in an amount that reflects

the consideration to which we expect to be entitled in exchange for those goods and services.

To achieve this core principle,

we apply the following five steps:

(1) Identify the contract with a client;

(2) Identify the performance obligations in the contract;

(3) Determine the transaction price;

(4) Allocate the transaction price to performance obligations in the contract;

and (5) Recognize

revenues when or as the Company satisfies a performance obligation.

We adopted ASC 2014-09 on January 1, 2019.

Although the new revenue standard is expected to have an immaterial impact, if any, on our ongoing net income, we did implement

changes to our processes related to revenue recognition and the control activities with them.

Convertible Instruments

The Company evaluates and account for

conversion options embedded in convertible instruments in accordance with ASC 815 “

The Company evaluates and account for conversion

options embedded in convertible instruments in accordance with ASC 815 “

Derivatives and Hedging Activities ”.

Applicable GAAP requires companies

to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments

according to certain criteria.

The criteria include circumstances in which (a) the economic characteristics and risks of the embedded

derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the

hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value

under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms

as the embedded derivative instrument would be considered a derivative instrument.

GREY CLOAK TECH INC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING

POLICIES (CONTINUED)

Applicable GAAP requires companies to bifurcate

conversion options from their host instruments and account for them as free-standing derivative financial instruments according

to certain criteria.

The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative

instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid

instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under

other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as

the embedded derivative instrument would be considered a derivative instrument.

The Company accounts for convertible instruments

7 unchanged sentences

convertible debt when a conversion option has been bifurcated using the general extinguishment standards.

The debt and equity linked

derivatives are removed at their carrying amounts and the shares issued are measured at their then-current fair value, with any

difference recorded as a gain or loss on extinguishment of the two separate accounting liabilities.

During the three months ending

March 31, 2018, the Company recognized a loss on extinguishment of $526,481 from the conversion of convertible debt with a bifurcated

conversion option.

Common Stock Purchase Warrants

The Company classifies as equity any

contracts that require physical settlement or net-share settlement or provide a choice of net-cash settlement or settlement in

the Company’s own shares (physical settlement or net-share settlement) provided that such contracts are indexed to our own

stock as defined in ASC 815-40 ("Contracts in Entity's Own Equity").

The Company classifies as assets or liabilities

any contracts that require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and

if that event is outside our control) or give the counterparty a choice of net-cash settlement or settlement in shares (physical

settlement or net-share settlement).

The Company assesses classification of common stock purchase warrants and other free standing

derivatives at each reporting date to determine whether a change in classification is required.

GREY CLOAK TECH INC

The debt and equity

linked derivatives are removed at their carrying amounts and the shares issued are measured at their then-current fair value,

with any difference recorded as a gain or loss on extinguishment of the two separate accounting liabilities.

During the months

ended March 31, 2021, the Company issued $340,000 of convertible debt with a bifurcated conversion option.

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

March 31, 2021 and 2020

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Common Stock Purchase Warrants

The Company classifies as equity any contracts

that require physical settlement or net-share settlement or provide a choice of net-cash settlement or settlement in the Company’s

own shares (physical settlement or net-share settlement) provided that such contracts are indexed to our own stock as defined

in ASC 815-40 ("Contracts in Entity's Own Equity").

The Company classifies as assets or liabilities any contracts that

require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside

our control) or give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share

The Company assesses classification of common stock purchase warrants and other free-standing derivatives at each

reporting date to determine whether a change in classification is required.

Gain on Extinguishment of debt

Note Satisfaction Agreements

Prior to the Exchange, the Company entered

into a Note Satisfaction Agreement with each of Auctus Fund, Crown Bridge Partners, LLC, Power Up Lending Group Ltd., GS Capital

Partners LLC, Oakmore Opportunity Fund I LP, and Adar Bays, LLC.

All of these entities were holders of the Company’s convertible

debt, and these Note Satisfaction Agreements terminate their convertible notes unless the Company fails to perform its payment

The Company agreed to pay these note holders an aggregate of $520,658 plus interest.

The Company paid an aggregate

of $353,908 on or before February 15, 2019.

The balance owed and outstanding of $160,000 plus interest was agreed to be purchased

by some third-party individuals.

During the third quarter 2020, these third-party individuals decided to convert the outstanding

notes into 2,400,000 shares of the Company’s common stock.

Various other holders of Convertible Promissory

Notes agreed to convert their notes for an aggregate of 806,015 shares of common stock prior to the Exchange.

As a result of these

transactions, no convertible promissory notes remain outstanding, except for those convertible notes subject to revival if the

Company fails to make payments pursuant to the Note Satisfaction Agreements.

NOTE 3 –

GOING CONCERN

The accompanying financial statements

have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and

the satisfaction of liabilities in the normal course of business.

The accompanying financial statements have

been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the

satisfaction of liabilities in the normal course of business.

The Company has generated minimal revenues from operations.

its inception, the Company has been engaged substantially in financing activities and developing its business plan and incurring

start up costs and expenses.

startup costs and expenses.

As a result, the Company incurred accumulated net losses from Inception (December 19, 2014) through

the period ended March 31, 2021 of $14,250,134.

In addition, the Company’s development activities since inception have been

financially sustained through equity financing.

Management plans to seek funding through debt and equity financing.

Due to our negative cash flow, the Company has substantial doubt about the entity’s

ability to continue as a going concern within one year after the date that the financial statements are issued.

In addition, the

Company’s development activities since inception have been financially sustained through equity financing.

Management plans

to keep seeking funding through debt and equity financing which are intended to mitigate the conditions that have raise substantial

doubt about the entity’s ability to continue as a going concern.

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021 and 2020

NOTE 4 –

RELATED PARTY

For the three months ended March 31,

2018 and 2017, the Company had expenses totaling $28,500 and $28,000, respectively, to an officer and director for salaries, which

is included in general and administrative expenses –

related party on the accompanying statement of operations.

31, 2018, there was no accounts payable –

related party.

For the three months ended March 31, 2018

and 2017, the Company had expenses totaling $42,000 and $28,500, respectively, to a company owned by an officer and director

for consulting fees, which is included in general and administrative expenses –

related party on the accompanying

statement of operations.

As of March 31, 2018, there was $15,000 in accounts payable –

related party.

For the three months ended March 31, 2018

and 2017, the Company had expenses totaling $30,498 and $0, respectively, to an officer and director for consulting fees,

which is included in general and administrative expenses –

related party on the accompanying statement of operations.

As of March 31, 2018, there was $11,923 in accounts payable –

related party.

For the three months ended March 31, 2018

and 2017, the Company had expenses totaling $12,000 and $0, respectively, to the wife of an officer and director for

consulting fees, which is included in general and administrative expenses –

related party on the accompanying statement

of operations.

As of March 31, 2018, there was $8,000 in accounts payable –

related party.

For the months ended March 31, 2021 and 2020,

the Company had expenses totaling $18,000 and $0 respectively, to an officer and director for salaries, which is included in general

and administrative expenses on the accompanying statement of operations As of March 31, 2021, there was a total of convertible

debt of $0.00 and accrued interest payable of $0.00 due to an officer and director, employees, and shareholders.

NOTE 5 –

NOTES PAYABLE –

CONVERTIBLE DEBT –

RELATED PARTY

As of March 31, 2018, the Company had

the following:

Unsecured convertible debt, due 10/17/18, 5% interest, converts at a 50% discount to market price based on the last 3 days trading price

GREY CLOAK TECH INC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

In 2020, the Company converted the outstanding

convertible debt which was due to a related party.

NOTE 6 –

NOTES PAYABLE

As of March 31, 2021, the Company had the following:

Unsecured debt with shareholders of the Company, no due date,

Unsecured debt with shareholders of the Company, no due date, 8% interest,

As of March 31, 2021, the Company has an outstanding total of $3,917.78

in interest accrued for the above note.

NOTE 7 –

CONVERTIBLE DEBT

As of March 31, 2018, the Company had

the following:

Unsecured convertible debt, due 08/24/18, 12% interest, converts at a 50% discount to market price based on the last 25 days trading price

Unsecured convertible debt, due 11/01/18, 12% interest, converts at a 50% discount to market price based on the last 25 days trading price

Unsecured convertible debt, due 10/04/18, 8% interest, converts at a 55% discount to market price based on

the last 20 days trading price

Unsecured convertible debt, due 02/02/19, 8% interest, converts at a 55% discount to market price based on the last 20 days trading price

Unsecured convertible debt, may borrow up to $300,000, due 10/04/18, 8% interest, converts at a 44% discount to market price based on the last 20 days trading price

Unsecured convertible debt, may borrow up to $300,000, due 11/09/18, 8% interest, converts at a 44% discount to market price based on the last 20 days trading price

Unsecured convertible debt, may borrow up to $300,000, due 01/08/19, 8% interest, converts at a 30% discount to market price based on the last 20 days trading price

Unsecured convertible debt, due 08/17/17, 12% interest, converts at a 45% discount to market price based on the last 20 days trading price

Unsecured convertible debt, due 01/23/18, 8% interest, converts at the lower of $0.04 or a 40% discount to market price based on the last 20 days trading price

Unsecured convertible debt, due 10/26/18, 8% interest, converts at a 45% discount to market price based on the last 20 days trading price

Unsecured convertible debt, due 06/26/18, 9% interest, converts at a 42% discount to market price based on the last 15 days trading price

Unsecured convertible debt, due 12/01/17, 12% interest, converts at a 50% discount to market price based on the last 20 days trading price

Unsecured convertible debt, due 06/30/18, 12% interest, converts at a 39% discount to market price based on the average of the lowest 2 trading prices in the last 15 days trading price

Unsecured convertible debt, due 07/30/18, 12% interest, converts at a 39% discount to market price based on the average of the lowest 2 trading prices in the last 15 days trading price

Unsecured convertible debt, due 10/10/18, 12% interest, converts at a 39% discount to market price based on the average of the lowest 2 trading prices in the last 15 days trading price

Unsecured convertible debt, due 01/19/17, 8% interest, default interest at 18%, converts at a 54% discount to market price based on the lowest trading prices in the last 20 days trading price

Some of the convertible promissory notes are

in default but will be in compliance upon filing of the 10-Q.

As of March 31, 2021, the Company had the following:

Unsecured convertible debt, due 01/19/17,

8% interest, default interest at 18%, converts at a 54% discount to market price based on the lowest trading prices in the

last 20 days trading price

Unsecured convertible debt, due 03/17/22, 10% interest,

default interest at 16%, converts at $0.05/share.

Below represent the Black-Scholes Option Pricing Model calculations

for the above convertible note payables:

Number of options valued

Value of Convertible Option

Unsecured Convertible debt #1

Unsecured Convertible debt #2

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021 and 2020

NOTE 7 –

CONVERTIBLE DEBT (CONTINUED)

As of March 31, 2021, the Company has an outstanding

total of $3,742 in accrued interest for the above convertible notes.

The convertible promissory notes #1 is in

default but management has not been able to make contact with this party, due to them living out of the country.

We have calculated

the derivative liability as if it is in default (but the note’s default interest rate stays the same at 8%) and will still

accrue appropriate interest until the note is fully satisfied or converted into the Company’s common stock.

The Company has determined that the conversion

1 unchanged sentence

has been bifurcated from the note and recorded as a derivative liability, with a corresponding discount recorded to the associated

GREY CLOAK TECH INC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

NOTE 8 –

5 unchanged sentences

of the stockholders of the corporation is sought.

During February 2017, the Company increased authorized number of shares to 500,000,000.

Also, the Company increased the preferred stock to 75,000,000 shares and designated 25,000,000 shares of preferred stock to Series

A Convertible Preferred Stock.

During January 2018, the Company increased its authorized number of common shares to 1,000,000,000.

During February 2017, the Company increased the authorized number of shares

to 500,000,000.

Also, the Company increased the authorized preferred stock to 75,000,000 shares and designated 25,000,000 shares

of preferred stock to Series A Convertible Preferred Stock.

During January 2018, the Company increased its authorized number of

common shares to 1,000,000,000.

During April 2018, the Company increased its authorized number of common shares to 2,500,000,000.

The Board of Directors, in the future, has the authority to increase the authorized capital up to 4,000,000,000 based on shareholder approval.

The shareholder of the Company approved a reverse

stock split at a ratio of between 1-for-100 and 1-for 250.

The Company received approval from FINRA for a reverse stock split of

1-for-250 pending the filing of this 10-Q.

On October 16, 2017, the Company filed

an Amended and Restated Certificate of Designation of the Rights, Preferences, Privileges and Restrictions of the Series A Convertible

The Board of Directors, in the future, has the authority to increase the authorized capital up to 4,000,000,000 shares based on

shareholder approval.

The shareholders of the Company approved a

reverse stock split at a ratio of between 1-for-100 and 1-for 250.

The Company received approval from FINRA for a reverse stock

split of 1-for-250, which was effective as of July 23, 2018.

On October 16, 2017, the Company filed an

Amended and Restated Certificate of Designation of the Rights, Preferences, Privileges and Restrictions of the Series A Convertible

Preferred Stock (the “Amended Certificate”) with the Secretary of State of the State of Nevada.

1 unchanged sentence

reduces the number of preferred shares designated as Series A Preferred Stock from 25,000,000 shares to 1,333,334 shares.

Certificate also changes the conversion and voting rights of the Series A Preferred Stock.

The Series A Preferred Stock is now

convertible into the number of shares of our common stock equal to 0.00006% of our outstanding common stock upon conversion.

voting rights of the Series A Preferred Stock are now equal to the number of shares of common stock into which the Series A Preferred

Stock may convert.

Amended Certificate also changes the conversion and voting rights of the Series A Preferred Stock.

The Series A Preferred Stock

is now convertible into the number of shares of our common stock equal to 0.00006% of our outstanding common stock upon conversion.

The voting rights of the Series A Preferred Stock are now equal to the number of shares of common stock into which the Series

A Preferred Stock may convert.

As of March 31, 2021, there are no outstanding

shares of preferred stock.

All the preferred stock was converted in common stock on February 4, 2019.

See recent developments

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021 and 2020

NOTE 8 –

STOCKHOLDERS’

EQUITY (CONTINUED)

Common Share Issuances

During the three months ended March 31, 2018,

the Company issued a total of 244,407,173 shares of common stock for the conversion of debt totaling $161,580 including interest

of $7,014 and fees of $18,415 and loss on settlement of debt of $526,481.

During the year ended March 31, 2021, the

Company issued 3,915,000 shares of common stock.

On March 18, 2021, the Company raised $340,000 note payable agreement which 1,200,000

shares of the Company’s common stock were issued to the note holder.

Additionally, 2,000,000 shares of common stock were

issued to a company helping secure the note.

Finally, 715,000 shares of common stock were issued for marketing services.

During the year ended December 31, 2020, the

Company issued 41,727,651 shares of common stock.

On several dates in September 2020, the Company raised $295,000 in direct security

purchase agreement which equal to 5,900,000 shares of the Company’s common stock.

During the fourth quarter of 2020, the

Company raised $155,000 in direct security purchase agreement which equal to 3,100,000 shares of the Company’s common stock.

Warrant Issuances

As of March 31, 2018, there were 10,956,250

warrants outstanding, of which 3,956,250 are fully vested.

In December 2020, the Company issued 7,500,000

warrants to three individuals at $0.05 per share.

These warrants will need to be exercised between the date of issue and three

years thereafter.

As of March 31, 2021, there were 7,512,000 warrants outstanding, of which 4,000 warrants are fully vested.

Stock Issued for Services

On January 28, 2019, the Company entered into

a marketing and sales consulting agreement with an individual for a period of six months.

The Company issued 350,000 shares of

common stock as the compensation for this agreement.

On March 18, 2021, the Company entered into a marketing consulting agreement

with an individual.

The Company issued 715,000 shares of common stock as the compensation for this agreement.

Share Conversion Agreements

All of the holders of the Company’s

Series A Convertible Preferred Stock (the “

Preferred Holders ”) entered into a Preferred Stock Conversion Agreement.

Pursuant to the Conversion Agreements, the Preferred Holders converted their shares of preferred stock into common stock, effective

as of the Exchange.

As a result, no shares of the Company’s Series A Convertible Preferred Stock are outstanding.

of 15,592,986 shares of common stock were issued to the Preferred Holders.

The Preferred Holders agreed to convert each share

of Series A Convertible Preferred Stock into eighteen (18) shares of common stock and agreed to retire a total of 467,057 shares

of Series A Convertible Preferred Stock.

The Company cancelled the retired shares.

Omnibus Stock Grant and Option Plan

On May 30, 2020, the Company proposed a stock

options agreement in the amount of 10,550,000 shares with a strike price of $0.05 to sixteen individuals.

This plan was approved

by the Company by the end of the third quarter 2020.

Purchase price under the plan is defined as:

unless otherwise permitted by

applicable law, the purchase price of Shares to be offered under the Plan shall not be less than eighty-five percent (85%) of

the Fair Market Value of a Share on the date of grant (100% for 10% shareholders).

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021 and 2020

NOTE 9 –

Acquisition of Ultimate Brain Nutrients,

On April 3, 2020, the Company entered into

a Share Exchange Agreement by and among Grey Cloak Tech Inc., Ultimate Brain Nutrients, LLC, a Delaware limited liability company

UBN ”), and the members of UBN, whereby we issued and exchanged 90,000,960 shares of our common stock for

all of the outstanding equity securities of UBN.

UBN is now our wholly-owned subsidiary.

The shares of common stock issued in

the Exchange are equal to approximately 42.5% of our outstanding common stock immediately following the exchange.

The assets acquired and liabilities

assumed as part of our acquisition were recognized at their fair values as of the effective acquisition date, April 3, 2020.

following table summarizes the fair values assigned to the assets acquired and liabilities assumed.

Current assets

Current liabilities

Net assets acquired

The purchase price method

was used when calculating the fair market value of the UBN purchase.

On April 3, 2020 the closing stock price for GRCK was $0.021.

The total number of shares exchanged multiplied by the closing stock price equaled a purchase value of $1,890,020.

The difference

between the net assets acquired and the purchase value was recorded as $1,579,883 of goodwill for the purchase.

Due to the goodwill

impairment, the Company fully expensed the goodwill recorded in this transaction.

The Company viewed UBN’s balance sheet

as being fairly valued as of April 3, 2020 so no adjustment was needed under the purchase price method of valuation.

NOTE 10 –

BUSINESS SEGMENT INFORMATION

of October 17, 2017, the Company operated in two reportable segments (Advertising and CBD) supported by a corporate group which

31, 2021, the Company operated in two reportable segments (Corporate and Health Supplements) supported by a corporate group which

conducts activities that are non-segment specific.

The following table present selected financial information about the Company’s

reportable segments for the three months ended March 31, 2018.

The following table presents selected financial information about the Company’s

reportable segments for the Months ended March 31, 2021.

HEALTH SUPPLEMENTS

Cost of Revenue

Long-lived Assets

Loss Before Income Tax

Gain (Loss) Before Income Tax

Identifiable Assets

Depreciation and Amortization

GREY CLOAK TECH INC

HEALTHY EXTRACTS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2018

March 31, 2021 and 2020

NOTE 11 –

SUBSEQUENT EVENTS

On April 27, 2018, the Company amended its articles

of incorporation and increased its authorized number of common shares to 2,500,000,000.

On June 8, 2018, the Company sold its

website, CBD.co, to a third party for $50,000.

Offering Circular

During the first part of the 2021, the Company

is in the process of filing a Regulation A with the U.S.

Securities and Exchange Commission.

We see this filing going through

final approval in the month of May 2021.

On March 11, 2020, the World Health Organization

declared the novel strain of coronavirus (COVID-19) a global pandemic and recommended containment and mitigation measures worldwide.

The Company is monitoring this closely, and although operations have not been materially affected by the coronavirus outbreak

to date, the ultimate severity of the outbreak is uncertain.

Further the uncertain nature of its spread globally may impact our

business operations resulting from quarantines of employees, customers, and third-party service providers.

At this time, the Company

is unable to estimate the impact of this event on its operations.

The Company evaluated its March 31, 2021 financial

statements for subsequent events through May 3, 2021, the date the financial statements were available to be issued.

ITEM 2 M a nagement’s Discussion and Analysis

36 unchanged sentences

Summary Overview

We were formed in

December 2014 and, therefore, have a relatively short operating history.

We had revenues of approximately $128,105 in the year

ended December 31, 2017, 94% of which was from a single customer.

We had revenues of approximately $19,856 in the three month period

ended March 31, 2018, but no revenue from the same customer.

In December 2017, we ended our relationship with this customer and

have shifted our focus from software services to medically-focused CBD hemp oil products.

We were formed in December

We had revenues of $1,276,559 in the year ended December 31, 2020 and $748,377 in the year ended December 31, 2019.

Eqova Life Sciences

On October 17, 2017,

we acquired Eqova Life Sciences, a Nevada corporation (“Eqova”), through an exchange of shares of our Series A Convertible

Preferred Stock for all of the outstanding equity interest of Eqova.

As part of the Exchange, we have brought on Eqova’s

President and Director, Patrick Stiles, to serve as our President and Chief Executive Officer and as a Director on our Board of

On October 17, 2017, we

acquired Eqova Life Sciences, a Nevada corporation, through an exchange of shares of our Series A Convertible Preferred Stock for

all of the outstanding equity interest of Eqova.

As part of the Exchange, we brought on Eqova’s President and Director, Patrick

Stiles, to serve as our President and Chief Executive Officer and as a Director on our Board of Directors.

Stiles resigned

in September 2018.

Eqova is a medically-focused

1 unchanged sentence

practitioners to use with their patients.

To date, we know of no other hemp oil company exclusively focused on the practitioner

market, leaving it largely underserved.

According to The Hemp Business Journal, CBD products marketplace are projected to grow

by 700% by 2020 with annual sales reaching $2.1 billion.

With a head start in a growing marketplace, we believe that Eqova provides

us with a prime growth opportunity with an established business.

Initial revenues of our hemp oil products from the acquisition

of Eqova through December 31, 2017 and for the three months ended March 31, 2018 were $7,605 and $19,856, respectively.

We believed that Eqova provided us with a prime growth opportunity with an established

Revenues of our hemp oil products from the acquisition of Eqova for the year ended December 31, 2018 were $64,384, but

were $0 in 2019.

We closed this business in the second quarter of 2019.

BergaMet NA, LLC

On February 4, 2019, we

issued and exchanged shares of our common stock for all of the outstanding equity securities of BergaMet.

The shares of common

stock issued in the Exchange were equal to approximately 80.1% of our outstanding common stock immediately following the exchange.

Through the exchange, we

were able to secure funds in BergaMet to pay off some debt and provide capital for operations.

We paid an aggregate of $353,908

and were obligated to pay another $164,578 approximately one (1) year later to retire convertible debt.

In the third quarter of

2020, we facilitated the sale of the then-outstanding debt to a third-party who converted it into an aggregate of 3,400,000 shares

of our common stock.

Prior to the exchange, we also entered into agreements with other holders of convertible debt to convert their

notes for an aggregate of 806,015 shares of common stock.

We also entered into conversion agreements with the holders of our Series

A Convertible Preferred Stock whereby all of the outstanding preferred stock was converted for an aggregate of 15,592,986 shares

of common stock.

The conversion and repayment of the preferred stock and convertible debt have greatly improved our capitalization

structure, as we now have no outstanding variable-price convertible debt.

The acquisition of BergaMet

has been extremely beneficial to us.

In addition to paying off our convertible debt, we are now able to better position ourselves

in the market.

BergaMet is an established company that was already generating revenues when we acquired it.

BergaMet also has unique

products that will fit nicely with our existing business.

We now plan on expanding our product line to other nutraceuticals.

BergaMet generated all

of our revenue in 2020.

Ultimate Brain Nutrients, LLC

On April 3, 2020, we entered

into a Share Exchange Agreement with Ultimate Brain Nutrients, LLC, a Delaware limited liability company (“UBN”), and

the members of UBN, whereby we issued and exchanged 90,000,960 shares of our common stock for all of the outstanding equity securities

UBN is now our wholly-owned subsidiary.

The shares of common stock issued in the Exchange were equal to approximately 42.5%

of our outstanding common stock immediately following the exchange.

UBN is a science-based

company that develops unique, plant-based superior health technology neuro-products that provide natural brain solutions.

numerous proprietary products, with four unique patent-pending formulations and one patent issued.

Financial results for UBN

are included in this Management’s Discussion and Analysis.

Going Concern

As a result of our

financial condition, we have received a report from our independent registered public accounting firm for our financial statements

for the years ended December 31, 2017 and 2016 that includes an explanatory paragraph describing the uncertainty as to our ability

to continue as a going concern.

From inception (December 19, 2014) through the period ended March 31, 2018, we have incurred accumulated

net losses of $7,747,768.

In order to continue as a going concern we must effectively balance many factors and begin to generate

revenue so that we can fund our operations from our sales and revenues.

If we are not able to do this we may not be able to continue

as an operating company.

At our current revenue and burn rate, our cash on hand will last less than one month, and thus we must

raise capital by issuing debt or through the sale of our stock.

However, there is no assurance that our existing cash flow will

be adequate to satisfy our existing operating expenses and capital requirements.

As a result of our financial

condition, we have received a report from our independent registered public accounting firm for our financial statements for the

years ended December 31, 2020 and 2019 that includes an explanatory paragraph describing the uncertainty as to our ability to continue

as a going concern.

From inception (December 19, 2014) through the end of December 31, 2020, we have incurred accumulated net losses

of $12,956,498.

In order to continue as a going concern we must effectively balance many factors and generate more revenue so that

we can fund our operations from our sales and revenues.

If we are not able to do this we may not be able to continue as an operating

At our current revenue and burn rate, we have an immediate cash need, and thus we must raise capital by issuing debt or

through the sale of our stock.

However, there is no assurance that our existing cash flow will be adequate to satisfy our existing

operating expenses and capital requirements.

Results of Operations for the Three Months Ended March 31, 2021

31, 2018 and 2017

We had revenues

of $19,856 for the three months ended March 31, 2018, compared to $42,000 for the three months ended March 31, 2017.

revenue was $14,699 for the three months ended March 31, 2018 compared to $3,000 for the three months ended March 31, 2017, an

increase of $11,699, or approximately 390%.

Our operating expenses were $232,064 for the three months ended March 31, 2018, compared

to $388,270 for the three months ended March 31, 2017, a decrease of $156,206, or approximately 40%.

We had revenues of $170,433

for the three months ended March 31, 2021, compared to $455,839 for the three months ended March 31, 2020.

Revenues for the three

months ended December 31, 2020 were $135,902.

Our cost of revenue for the three months ended March 31, 2021 were $41,442, compared

to $196,057 for the three months ended March 31, 2020.

Our operating expenses

consisted mostly of general and administrative expenses, including general and administrative expenses to a related party.

were $716,087 for the three months ended March 31, 2021, compared to $207,632 for the three months ended March 31, 2020, an increase

of $508,455, or 245%.

Our operating expenses consisted entirely of general and administrative expenses.

Revenues and Net Operating Loss

Our revenue, operating

expenses, net operating loss, and net loss for the three months ended March 31, 2018 and 2017 were as follows:

Operating expenses:

expenses, net operating loss, and net gain (loss) for the three months ended March 31, 2021 and 2020 were as follows:

Cost of Revenue

Operating expenses:

General and administrative

General and administrative - related party

Total operating expenses

Net operating loss

Other income (expense)

Revenues were $19,856

for the three months ended March 31, 2018, compared to $42,000 for the three months ended March 31, 2017, a decrease of $22,144,

or approximately 53%.

For the three months ended March 31, 2017, nearly all of the total revenue came from a single customer.

we received no revenue from this customer during the three months ended March 31, 2018.

The decrease reflects the loss of this

customer and the transition to our new business selling CBD products.

Cost of Revenue

Interest expenses, net of interest income

Change in fair value on derivative

Loss on extinguishment of debt

SBA Loan Forgiveness

Impairment of Assets

Gain on sale of asset

Total other income (expense)

Net income (loss)

$ (1,293,636 )

We had revenues of $170,433

for the three months ended March 31, 2021, compared to $455,839 for the three months ended March 31, 2020, a reduction of $285,406,

Revenues for the three months ended December 31, 2020 were $135,902.

Our cost of revenue for the three months ended March

31, 2021 were $41,442, or 24% of revenue, compared to $196,057 for the three months ended March 31, 2020, or 43% of revenue.

Cost of Revenue

was $14,699 for the three months ended March 31, 2018, compared to $3,00 for the three months ended March 31, 2017, an increase

of $11,699, an increase of approximately 390%.

The increase was due to the change of our business from a service-based business

to a product-based business.

Gross profit will be much smaller going forward because of this shift in our business.

Cost of revenue was $41,442

for the three months ended March 31, 2021, compared to $196,057 for the three months ended March 31, 2020, a decrease of $154,615,

Gross profit was $128,991 for the three months ended March 31, 2021, compared to $259,782 for the three months ended March

31, 2020, a decrease of $130,792, or 50%.

Cost of revenue as a percentage

of revenues was 24% for the three months ended March 31, 2021, compared to 343% for the three months ended March 31, 2020.

General and Administrative

1 unchanged sentence

expenses were $716,087 for the three months ended March 31, 2021, compared to $207,632 for the three months ended March 31, 2020.

a decrease of $218,097, or 66%.

The decrease was due to decrease in financing and loan fees, marketing fees, commissions and consulting

In the three months ended March 31, 2018, general and administrative expense consisted mainly of legal and professional fees

totaling $29,514, consulting $3,893, salaries, wages and payroll costs of $15,703, advertising and marketing of $9,024, computer

and programming of $6,033, travel expenses of $3,800, selling expenses of $1,777, commissions of $2,965, transfer agent and filing

fees of $1,529, and accounting fees of $2,970.

In the three months ended March 31, 2017, general and administrative expense consisted

mainly of consulting $76,700, selling expenses of $895, commissions of $13,500, transfer agent and filing fees of $4,245, and accounting

General and administrative

expenses –

related party were $118,391 for the three months ended March 31, 2018, compared to $56,500 for the three months

ended March 31, 2017, an increase of $61,891, or approximately 110%.

The increase was mainly due to increase in compensation to

Patrick Stiles.

Net Operating Loss

Net operating loss

was $226,907 for the three months ended March 31, 2018, compared to $349,270 for the three months ended March 31, 2017, a decrease

of $122,363, or approximately 35%.

Net operating loss decreased, as set forth above, primarily due to a decrease in general and

administrative expenses, offset by a decrease in revenues.

In the three months ended March 31, 2021, general and administrative expenses consisted mainly of consulting fees $172,500, professional

fees $368,960, salary and wages $30,446, advertising $82,729, and postage $7,625.

In the three months ended March 31, 2020, general

and administrative expenses consisted mainly of professional fees $15,122, consulting fees $73,754, salary and wages $39,727, postage

$7,501, advertising $19,551, and transfer agent and filing fees of $1,470.

Other Income (Expense)

Other income was

$162,521 for the three months ended March 31, 2018, compared to other expense of $148,893 for the three months ended March 31,

2017, an increase of $311,414.

The increase of other income (expense) was due to a decrease in interest expense, net of interest

income, from $1,272,493 during the three months ended March 31, 2017 to $408,097 for the three months ended March 31, 2018.

change in interest expense was due to amortization of the debt discount and the derivatives on the convertible debt.

Other income for

the three months ended March 31, 2018 consisted primarily of a change in the fair value of derivatives, offset by interest expense

and loss on extinguishment of debt.

Other expense for the three months ended March 31, 2017 consisted primarily of interest expense

and loss on extinguishment of debt, offset by a change in fair value of derivatives.

Net loss was $64,386

for the three months ended March 31, 2018, or $0.00 per share, compared to $498,163 for the three months ended March 31, 2017,

or $0.03 per share, a decrease of $433,777.

Net loss decreased, as set forth above, primarily due to a decrease in interest expense

from new debt issuances, and a decrease in general and administrative expenses, offset by an increase in loss on extinguishment

Other income (expense)

was $(706,540) for the three months ended March 31, 2021, compared to $572,660 for the three months ended March 31, 2020, a decrease

of $1,279,200, or 223%.

In the three months ended March 31, 2021, other income (expense) consisted of interest expense, net of

interest income of $(15,759) and change in fair value on derivative of $(690,780).

Change in fair value of derivative was related

to the conversion of convertible debts into common stock shares .

In the three months ended

March 31, 2020, other income (expense) consisted of interest expense, net of interest income of $(42,476) and change in fair value

on derivative of $615,136.

Net Income (Loss)

Net income (loss) was $(1,293,636)

and $624,811, or $0.00 and $0.01 per share, for the three months ended March 31, 2021 and 2020.

Our net income (loss) various

from period to period primarily because of the change in fair value on derivative.

Liquidity and Capital Resources

During the three

months ended March 31, 2018, we were unable to generate sufficient revenues and had negative operating cash flows.

hand as of March 31, 2018 was $88,052, which was derived from the sale of convertible promissory notes to investors.

cash flow burn rate for 2017 was approximately $63,000.

Although we have moderate short term cash needs, as our operating expenses

increase we will face strong medium to long term cash needs.

We anticipate that these needs will be satisfied through the issuance

of debt or the sale of our securities until such time as our cash flows from operations will satisfy our cash flow needs.

Our cash, current

assets, total assets, current liabilities, and total liabilities as of March 31, 2018 and December 31, 2017, respectively, are

During the three months

ended March 31, 2021, we were unable to generate sufficient revenues and had negative operating cash flows.

Our cash on hand as

of December 31, 2020 was $59,201, and as of March 31, 2021 was $232,932.

The increase in cash on hand was primarily from our net

cash used in operating activities of $(635,261), offset by net cash provided by financing activities of $846,880.

Our monthly cash

flow burn rate for 2020 (not

including inventory purchases) was approximately

$192,000, and for the three months ended March 31, 2021

it was approximately $212,000.

We have strong short and medium term cash needs.

We anticipate that these needs will be satisfied

through increased revenues and the issuance of debt or the sale of our securities until such time as our cash flows from operations

will satisfy our cash flow needs.

Our cash, current assets,

total assets, current liabilities, and total liabilities as of March 31, 2021 and December 31, 2020, respectively, are as follows:

Total Current Assets

Total Current and Total Liabilities

Our cash increased

slightly because we were able to raise capital from the sale of warrants, notes and convertible notes.

Our total current assets

decreased primarily because of lower inventory and accounts receivable as of March 31, 2018.

Our total current liabilities decreased

during the three months ended March 31, 2018 primarily because of changes to the value of our derivative liabilities as of March

Our accumulated deficit increased during the three months ended March 31, 2018 by $64,386 to ($7,747,768) while our total

stockholders’

deficit decreased by $811,585 to $367,542, primarily due to issuances of stock upon conversion of our convertible

In order to repay

our obligations in full or in part when due, we will be required to raise significant capital from other sources.

There is no assurance,

however, that we will be successful in these efforts.

and total assets increased during the three months ended March 31, 2021 primarily as a result of our increase in cash of $173,731

and inventory of $61,961.

Our total current and total liabilities increased by $1,070,436 during the three months ended March 31,

2021 primarily because of an increase in convertible debt of $340,000, derivative liabilities of $690,780, and accrued liabilities

Our accumulated deficit increased during the three months ended March 31, 2021 by $1,293,636 to $14,250,134.

In order to repay our obligations

in full or in part when due, we will be required to raise significant capital from other sources.

There is no assurance, however,

that we will be successful in these efforts.

Cash Requirements

Our cash on hand

as of March 31, 2018 was $88,052.

Our cash on hand as of

March 31, 2021 was $232,932.

Based on our current level of revenues and monthly burn rate of approximately $212,000 per month,

2 unchanged sentences

Operating Activities

We had net cash

used in operating activities of $188,184 for the three months ended March 31, 2018, compared to $225,234 for the three months ended

We had net cash used in

operating activities of $(635,261) for the three months ended March 31, 2021, compared to $(175,395) for the three months ended

March 31, 2020.

We use our cash for normal business operations.

Our net cash used in operating activities for the three months

ended March 31, 2021 consisted of our net loss of $1,293,636, plus a decrease in inventory of $61,961, offset by a change in fair

value on derivative liability of $690,780 and accrued interest payable of $50,298.

Investing Activities

We had zero net

cash from/used in investing activities for the three months ended March 31, 2018, and $20,000 net cash used in investing activities

for the three months ended March 31, 2017.

The primary reason for the difference between these periods are payments made for notes

receivable during the three months ended March 31, 2017 while we made no such payments during the three months ended March 31,

We had $(37,888) in cash

flows provided by investing activities for the three months ended March 31, 2021, compared to $zero for the three months ended

March 31, 2020.

Financing Activities

Our net cash provided

by financing activities for the three months ended March 31, 2018 was $194,583, all of which was proceeds from convertible notes

payable, compared to $252,750 for the three months ended March 31, 2017, all of which was proceeds from notes payable, convertible

notes payable, warrants and the exercise of warrants.

Our net cash provided by

financing activities for the three months ended March 31, 2021 was $846,880, compared to $109,607 for the three months ended March

Our net cash provided by financing activities

consisted of proceeds from the issuance of

common stock of $506,880 and proceeds from the issuance of convertible debt of $340,000.

ITEM 3 Quantitative and Qualitative Disclosures About Market Risk

As a smaller reporting company, we are

not required to provide the information required by this Item.

As a smaller reporting company, we are not required

to provide the information required by this Item.

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-Q/A

Item 1. Financial Statements