UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 31, 2018 ¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________________ to _______________

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended April 30, 2018
or
¨	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _______________ to _______________

Commission File Number 333-214643

SUNSET ISLAND GROUP, INC.

(Exact name of registrant as specified in its charter)

Colorado		47-3278534
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)
20420 Spence Road, Salinas, CA		93908
(Address of principal executive offices)		(Zip Code)

20420 Spence Road, Salinas, CA		93908
(Address of principal executive offices)		(Zip Code)

(424) 239-6230
(Registrant’s telephone number, including area code)

N/A
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

(424) 239-6230

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	None	None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ¨ ☐ YES x NO Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). x YES ¨ NO Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). x YES ¨ NO

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	x	Smaller reporting company	x
		Emerging growth company	x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) ¨ YES x NO Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. 5,386,771 shares of common stock as of April 20, 2020

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) ¨ YES x NO

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. ¨ YES ¨ NO

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

5,386,771 shares of common stock as of October 9, 2019

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	3	3
Item 2.	Management’'s Discussion and Analysis of Financial Condition orand ~~Plan~~Results of ~~Operation~~Operations	21	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26	26
Item 4.	Controls and Procedures	27	26
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	28	27
Item 1A.	Risk Factors	28	27
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28	27
Item 3.	Defaults Upon Senior Securities	28	27
Item 4.	Mine Safety ~~Disclosures~~Disclosure	28	27
Item 5.	Other Information	28	27
Item 6.	Exhibits	29	28
SIGNATURES		30	29

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Sunset Island Group, Inc.

		Page

Condensed Consolidated Balance Sheets as of July 31, 2018 and October 31, 2017 (Unaudited)		4
Condensed Consolidated Statements of Operations for the Three and Nine Months Ended July 31, 2018 and 2017 (Unaudited)		5
Condensed Consolidated Statements of Changes in Stockholders' Deficit for the Nine Months Ended July 31, 2018 and 2017 (Unaudited)		6
Condensed Consolidated Statements of Cash Flows for the Nine Months Ended July 31, 2018 and 2017 (Unaudited)		8
Notes to Condensed Consolidated Financial Statements (Unaudited)		9

Condensed Consolidated Balance Sheets
April 30, October 31,
2018 2017
Assets
Current Assets
Cash and cash equivalents $ 289,050 $ 24,656
Total Current Assets 289,050 24,656
Deposit 14,000 14,000
Total Assets $ 303,050 $ 38,656
Liabilities and Stockholders' Deficit
Current Liabilities
Accounts payable and accrued liabilities $ 15,642 $ 25,817
Accrued interest 24,913 -
Accrued interest - related party 3,109 -
Dividend payable 97,416 46,029
Due to related party 3,438 2,885
Convertible notes, net of unamortized discount of $829,855 285,145 -
Current portion of notes payable - related party 157,200 -
Derivative liabilities 928,872 -
Total Current Liabilities 1,515,735 74,731
Notes payable - related party 272,200 330,200
Total Liabilities 1,787,935 404,931
Commitments and Contingencies (note 9)
Stockholders' Deficit
Preferred stock, $0.0001 par value, 15,000,000 shares authorized; Series A Convertible Preferred Stock, 4,600,000 shares designated, 4,600,000 shares issued and outstanding 460 460
Series B Preferred Stock, 8,000,000 shares designated, no shares issued and outstanding - -
Series C Convertible Preferred Stock, 500,000 shares designated, no shares issued and outstanding - -
Common Stock, par value $0.0001, 27,000,000 shares authorized, 5,386,771 and 4,871,771 shares issued and outstanding, respectively 539 487
Additional paid in capital 494,109 334,168
Subscriptions received - shares to be issued - 50,000
Accumulated deficit (1,979,993 ) (751,390 )
Total Stockholders' Deficit (1,484,885 ) (366,275 )
Total Liabilities and Stockholders' Deficit $ 303,050 $ 38,656
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

3

Table of Contents

Sunset Island Group, Inc.

Condensed Consolidated ~~Statements~~Balance ~~of Operations~~Sheets

(Unaudited)

	Three Months Ended						Six Months Ended
	July 31,			October 31,
	April 30,						April 30,
	2018			2017
	2018			2017			2018			2017
Assets
Revenue	$	-		$	-		$	-		$	-
Current Assets
Operating Expenses
Cash and cash equivalents	$	52,236		$	24,656
Labor		188,980			30,481			373,958			30,481
Total Current Assets		52,236			24,656
Supplies		64,508			51,259			92,083			51,259
Deposit		14,000			14,000
General and administrative expenses		104,299			16,182			146,846			17,162
Total Assets	$	66,236		$	38,656
Lease		53,442			11,500			108,372			11,500
Liabilities and Stockholders’ Deficit
Lab testing		1,060			-			1,310			-
Current Liabilities
Utilities		35,354			-			38,821			-
Accounts payable and accrued liabilities	$	28,325		$	25,817
Professional fees		16,296			4,000			18,332			4,000
Accrued interest		55,503			-
Total Operating Expenses		463,939			113,422			779,722			114,402
Accrued interest - related party		6,984			-
Loss from operations		(463,939	)		(113,422	)		(779,722	)		(114,402	)
Dividend payable		90,572			46,029
Other Income (Expense)
Due to related party		-			2,885
Interest expense		(606,457	)		-			(620,872	)		-
Convertible notes, net of unamortized discount of $604,145		620,856			-
Net change in fair value of derivative liabilities including day one losses		223,378			-			223,378			-
Current portion of notes payable - related party		157,200			-
		(383,079	)		-			(397,494	)		-
Derivative liabilities		1,250,360			-
Net Loss	$	(847,018	)	$	(113,422	)	$	(1,177,216	)	$	(114,402	)
Total Current Liabilities		2,209,800			74,731
Net loss per common share – basic and diluted	$	(0.16	)	$	(0.00	)	$	(0.22	)	$	(0.00	)
Notes payable - related party		290,200			330,200
Weighted average number of common shares outstanding		5,383,569			50,031,771			5,377,572			50,031,771
Total Liabilities		2,500,000			404,931
Commitments and Contingencies (note 9)		-			-
Stockholders’ Deficit
Preferred stock, $0.0001 par value, 15,000,000 shares authorized;
Series A Convertible Preferred Stock, 4,600,000 shares designated, 4,600,000 shares issued and outstanding		460			460
Series B Preferred Stock, 8,000,000 shares designated, no shares issued and outstanding		-			-
Series C Convertible Preferred Stock, 500,000 shares designated, no shares issued and outstanding		-			-
Common Stock, par value $0.0001, 27,000,000 shares authorized, 5,386,771 and 4,871,771 shares issued and outstanding, respectively		539			487
Additional paid in capital		494,684			334,168
Subscriptions received - shares to be issued		-			50,000
Accumulated deficit		(2,929,447	)		(751,390	)
Total Stockholders’ Deficit		(2,433,764	)		(366,275	)
Total Liabilities and Stockholders’ Deficit	$	66,236		$	38,656

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

Table of Contents

Sunset Island Group, Inc.Condensed Consolidated Statements of Operations(Unaudited)

Condensed Consolidated Statements of Stockholders’ Deficit

	Three Months Ended						Nine Months Ended
	July 31,						July 31,
	2018			2017			2018			2017

Revenue	$	-		$	-		$	-		$	-

Operating Expenses
Labor		87,424			101,038			461,382			131,519
Supplies		47,270			29,489			139,353			80,748
General and administrative expenses		146,861			5,170			293,707			22,332
Lease		34,658			32,739			143,030			44,239
Lab testing		-			-			1,310			-
Utilities		27,318			6,126			66,139			6,126
Professional fees		6,783			-			25,115			4,000
Total Operating Expenses		350,314			174,562			1,130,036			288,964

Loss from operations		(350,314	)		(174,562	)		(1,130,036	)		(288,964	)

Other Income (Expense)
Interest expense		(353,305	)		-			(971,068	)		-
Interest expense - related party		(3,875	)		-			(6,984	)		-
Net change in fair value of derivative liabilities including day one losses		(241,960	)		-			(18,582	)		-
		(599,140	)		-			(996,634	)		-

Net Loss	$	(949,454	)	$	(174,562	)	$	(2,126,670	)	$	(288,964	)

Net loss per common share – basic and diluted	$	(0.18	)	$	(0.00	)	$	(0.40	)	$	(0.01	)
Weighted average number of common shares outstanding		5,386,771			50,031,771			5,380,672			50,031,771

For the Six Months Ended April 30, 2018

(Unaudited)

									Additional			Common Stock
	Series A Preferred Stock				Common Stock				Paid-In			Subscription			Accumulated
	Shares		Amount		Shares		Amount		Capital			Received			Deficit			Total
Balance - October 31, 2017		4,600,000		460		4,871,771		487		334,168			50,000			(751,390	)		(366,275	)
Common stock issued for cash		-		-		500,000		50		49,950			(50,000	)		-			-
Beneficial conversion feature		-		-		-		-		9,444			-			-			9,444
Contribution		-		-		-		-		69,841			-			-			69,841
Net loss for the period		-		-		-		-		-			-			(330,198	)		(330,198	)
Balance - January 31, 2018		4,600,000	$	460		5,371,771	$	537	$	463,403		$	-		$	(1,081,588	)	$	(617,188	)
Common stock issued for note repayment		-		-		15,000		2		31,498			-			-			31,500
Reclassification of beneficial conversion feature to derivative liability from additional paid in capital		-		-		-		-		(9,444	)		-			-			(9,444	)
Contribution		-		-		-		-		8,652			-			-			8,652
Net loss for the period		-		-		-		-		-			-			(847,018	)		(847,018	)
Declaration of cash dividend		-		-		-		-		-			-			(51,387	)		(51,387	)
Balance - April 30, 2018		4,600,000	$	460		5,386,771	$	539	$	494,109		$	-		$	(1,979,993	)	$	(1,484,885	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

Table of Contents

Sunset Island Group, Inc.
Condensed Consolidated Statements of Stockholders’ Deficit
For the Nine Months Ended July 31, 2018
(Unaudited)

									Additional			Common Stock
	Series A Preferred Stock				Common Stock				Paid-In			Subscription			Accumulated
	Shares		Amount		Shares		Amount		Capital			Received			Deficit			Total
Balance - October 31, 2017		4,600,000	$	460		4,871,771	$	487	$	334,168		$	50,000		$	(751,390	)	$	(366,275	)

Common stock issued for cash		-		-		500,000		50		49,950			(50,000	)		-			-
Beneficial conversion feature		-		-		-		-		9,444			-			-			9,444
Contribution		-		-		-		-		69,841			-			-			69,841
Net loss for the period		-		-		-		-		-			-			(330,198	)		(330,198	)
Balance - January 31, 2018		4,600,000	$	460		5,371,771	$	537	$	463,403		$	-		$	(1,081,588	)	$	(617,188	)

Common stock issued for note repayment		-		-		15,000		2		31,498			-			-			31,500
Reclassification of beneficial conversion feature to derivative liability from additional paid in capital		-		-		-		-		(9,444	)		-			-			(9,444	)
Contribution		-		-		-		-		8,652			-			-			8,652
Net loss for the period		-		-		-		-		-			-			(847,018	)		(847,018	)
Declaration of cash dividend		-		-		-		-		-			-			(51,387	)		(51,387	)
Balance - April 30, 2018		4,600,000	$	460		5,386,771	$	539	$	494,109		$	-		$	(1,979,993	)	$	(1,484,885	)

Contribution		-		-		-		-		575			-			-			575
Net loss for the period		-		-		-		-		-			-			(949,454	)		(949,454	)
Balance - July 31, 2018		4,600,000	$	460		5,386,771	$	539	$	494,684		$	-		$	(2,929,447	)	$	(2,433,764	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

Table of Contents

Sunset Island Group, Inc.

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

For the ~~Six~~Nine Months Ended ~~April~~July 3031, 2017

(Unaudited)

									Additional		~~Common Stock~~
	Series A Preferred Stock				Common Stock				Paid-In		~~Subscription~~Accumulated			~~Accumulated~~
	Shares		Amount		Shares		Amount		Capital		~~Received~~Deficit			~~Deficit~~Total			~~Total~~
Balance - October 31, 2016		-	$	-		50,031,771	$	5,003	$	5,997	$	-(10,030	)	$	~~(10,030~~970	)	$	~~970~~
Net loss for the period		-		-		-		-		-		-(980	)		(980	)		~~(980~~	)
Balance - January 31, 2017		-	$	-		50,031,771	$	5,003	$	5,997	$	-(11,010	)	$	(~~11,010~~10	)	$	~~(10~~	)
Net loss for the period		-		-		-		-		-		-(113,422	)		(113,422	)		~~(113,422~~	)
Balance - April 30, 2017		-	$	-		50,031,771	$	5,003	$	5,997	$	-(124,432	)	$	(~~124~~113,432	)	$	~~(113,432~~	)
Net loss for the period		-		-		-		-		-		(174,562	)		(174,562	)
Balance – July 31, 2017		-	$	-		50,031,771	$	5,003	$	5,997	$	(298,994	)	$	(287,994	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

67 Table of Contents

Sunset Island Group, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	Six Months Ended
	Nine Months Ended
	April 30,
	July 31,
	2018			2017
Cash Flows From Operating Activities:
Net loss	$	(12,~~177~~126,~~216~~670	)	$	(~~114~~288,~~402~~964	)
Adjustments to reconcile net loss to net cash used in operating activities
Amortization of debt discount		~~505~~827,~~145~~883			-
Change in fair value of derivative liabilities		~~(223~~18,~~378~~582	)		-
Prepayment interest penalty		85,289
Prepayment interest penalty by share issuance		31,500			-
Change in operating assets and liabilities:
Deposit		-			(14,000	)
Accounts payable and accrued liabilities		~~(10~~2,~~175~~508	)		716,~~108~~227
Accrued interest		2755,~~480~~504			-
Accrued interest - related party		36,~~109~~984			-
Net Cash Used in Operating Activities		(~~789~~1,~~746~~183,709	)		(~~121~~286,~~294~~737	)
Cash Flows From Financing Activities:
Proceeds from promissory notes - related party		99117,200			~~123~~281,~~200~~700
Contribution		7879,~~493~~068			-
Advancement from related party		~~900~~11,637			-4,983
Repayment to related party		(~~347~~14,522	)		-(1,650	)
Proceeds from convertible note		1,152,250			-
Dividend paid		(6,844	)		-
Repayment of convertible note		(276,356	)		-
Proceeds from convertible note		1,244,750			-
Net Cash Provided by Financing Activities		1,054,140			123,200
Repayment of convertible note		(220,000	)		-
Net change in cash and cash equivalents		264,394			1,906
Net Cash Provided by Financing Activities		1,211,289			285,767
Net change in cash and cash equivalents		27,580			(970	)
Cash and cash equivalents, beginning of period		24,656			970
Cash and cash equivalents, end of period	$	~~289~~52,~~050~~236		$	~~2,876~~-
Supplemental cash flow information:
Cash paid for interest	$	-2,567		$	-
Cash paid for taxes	$	-		$	-
Non-cash financing transactions:
Declaration of cash dividend	$	51,387		$	-
Derivative liabilities recognized as debt discount	$	~~707~~787,~~669~~197		$	-
Warrants issued in conjunction with convertible notes recognized as debt discount	$	444,581		$	-
Common stock issued for partial repayment of convertible note	$	31,500		$	-
Common stock issued for subscription received	$	50,000		$	-
Common stock issued	$	50,000		$	-

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

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Sunset Island Group, Inc.

~~NOTES~~Notes TOto ~~CONSOLIDATED~~Condensed ~~FINANCIAL~~Consolidated ~~STATEMENTS~~Financial Statements

(Unaudited)

NOTE 1 – DESCRIPTION OF BUSINESS

Sunset Island Group, Inc. (“SIGO” or the “Company”) was originally incorporated in the State of Colorado on September 29, 2005 as Gulf West Property, Inc. On October 25, 2005 the Company changed its name to Titan Global Entertainment, Inc. On May 7, 2008, the Company changed its name to Sunset Island Group, Inc.

Our business and corporate address is 20420 Spence Road, Salinas CA 93908, our phone number is (424) 239-6230. Our corporate website is www.sunsetislandgroup.com.

We have one subsidiary, VBF Brands, Inc. (“VBF Brands”), a California, corporation.

Our Business

The Company operates its cannabis growing, cultivation, manufacturing and distribution business through its wholly owned subsidiary VBF Brands. VBF Brands operated as a Nonprofit Mutual Benefit entity until December 21, 2017 when it was converted to a For Profit entity. Prior to December 21, 2017, VBF Brands operated as a collective under the Compassionate Use Act. Since VBF Brands was operating as a Nonprofit until December 21, 2017, the Company determined that it cannot book any revenue from the activities associated while it operated as collective under the Compassionate Use Act and as a non-profit. ~~However, the Company will book the revenue generated by VBF Brands since December 21, 2017.~~

The Company previously operated its cultivation business through its former wholly owned subsidiary Battle Mountain Genetics, Inc. (“BMG”); however, upon the conversion of VBF Brands to a for profit entity the Company transitioned the operation of all of its cannabis actives through VBF Brands and BMG ceased active operations.

Share Exchange

BMG was incorporated in the State of California on September 29, 2016. On October 17, 2016, the Company entered into an agreement whereby it acquired 100% of the issued and outstanding shares of capital stock of BMG in exchange for 50,000,000 shares of SIGO common stock.

Prior to the share exchange SIGO had no assets, liabilities or operations; following the share exchange SIGO operated BMG as a wholly owned subsidiary. Immediately prior to the share exchange with BMG’s shareholders, there were 30,894 shares of SIGO Common Stock outstanding and no shares of SIGO Preferred Stock outstanding. After the share exchange, the Company had 50,031,771 Common shares outstanding and no shares of Preferred Stock outstanding.

Divestiture of Battle Mountain Genetics, Inc.

During December 2017, the Company divested itself of BMG by transferring all of the issued and outstanding shares of BMG, to T.J. Magallanes a former officer and director of the Company, in exchange for 3,036,000 of Mr. Magallanes’ SIGO Series A Preferred shares.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation of Interim Financial Statements

The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the ~~six~~nine months ended ~~April~~July 3031, 2018 are not necessarily indicative of the results that may be expected for the year ending October 31, 2018. Notes to the unaudited interim condensed consolidated financial statements that would substantially duplicate the disclosures contained in the audited consolidated financial statements for fiscal year 2017 have been omitted. This report should be read in conjunction with the audited consolidated financial statements and the footnotes thereto for the fiscal year ended October 31, 2017 included in the Company’s 10-K as filed with the Securities and Exchange Commission on March 25, 2019.

89 Table of Contents

Consolidation Policy

The unaudited condensed consolidated financial statements of the Company include the accounts of the Company and its wholly owned subsidiary, VBF Brands, Inc. All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates and Assumptions

The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and cash equivalents

Cash equivalents are short-term highly liquid investments that are readily convertible to cash with original maturities of three months or less, at the date acquired. As of ~~April~~July 3031, 2018 and October 31, 2017, cash primarily consists of cash in bank. As of ~~April~~July 3031, 2018 and October 31, 2017, cash was $~~289~~52,~~050~~236 and $24,656, respectively.

Basic and Diluted Net Loss Per Share of Common Stock

The Company has adopted ASC Topic 260, “ ”Earnings per Share,” (“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying financial statements, basic earnings (loss) per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.

As at ~~April~~July 3031, 2018 and October 31, 2017, the Company has the following potentially dilutive securities, which were excluded from the computation of diluted net loss per common share as the result of the computation was anti-dilutive.

	April 30,		October 31,
	July 31,		October 31,
	2018		2017
Series A convertible preferred stock		46,000,000		46,000,000
Convertible Notes		12,~~328~~899,~~172~~408		-
Warrants		~~211~~1,~~883~~210,762		-
		47,540,055		46,000,000
		50,110,170		46,000,000

Concentrations of Credit Risk

The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents and related party payables that it will likely incur in the near future. The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.

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Financial Instruments

The Company follows ASC 820, “ Fair Value Measurements and Disclosures,” which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous 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 that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of ~~January~~July 31, 2018. The carrying values of our financial instruments, including, cash and cash equivalents, accounts payable and accrued expenses; and dividend payable and due to related party approximate their fair values due to the short-term maturities of these financial instruments.

The following table summarizes fair value measurements by level at ~~April~~July 3031, 2018 and October 31, 2017, measured at fair value on a recurring basis:

April 30, 2018

Level 1

Level 2

Level 3

Total

July 31, 2018

Level 1

Level 2

Level 3

Total

Liabilities

Derivative Liabilities

~~928~~1,~~872~~250,360

October 31, 2017

~~Level 1~~

Level 1

~~Level 2~~

Level 2

~~Level 3~~

Level 3

~~Total~~

Total

Liabilities

Derivative Liabilities

Related Parties

The Company follows ASC 850, “ ”Related Party Disclosures,” for the identification of related parties and disclosure of related party transactions. See notes 4.

Income Taxes

We account for income taxes under ASC 740 “ Income Taxes.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

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Revenue Recognition

The Company recognizes revenue in accordance with “Revenue from Contracts with Customers” (“ASC 606”). ASC 606 requires that the criteria must be met before revenue can be recognized:

The parties to the contract have approved the contract (in writing, orally, or in accordance with other customary business practices) and are committed to perform their respective obligations.

The Company can identify each party’s rights regarding the goods or services to be transferred.

The Company can identify the payment terms for the goods or services to be transferred.

The contract has commercial substance (that is, the risk, timing, or amount of the entity’s future cash flows is expected to change as a result of the contract).

It is probable that the Company will collect substantially all of the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer. In evaluating whether collectability of an amount of consideration is probable, an entity shall consider only the customer’s ability and intention to pay that amount of consideration when it is due. The amount of consideration to which the entity will be entitled may be less than the price stated in the contract if the consideration is variable because the entity may offer the customer a price concession.

Research and Development Expenses

We follow ASC 730, “ ”Research and Development,” and expense research and development costs when incurred. Accordingly, third-party research and development costs, including designing, prototyping and testing of product, are expensed when the contracted work has been performed or milestone results have been achieved. Indirect costs are allocated based on percentage usage related to the research and development.

Leasehold improvements

The company subleases land shared with other larger farms. In addition to fixed monthly lease payments, the Company is required to pay a proportionate share of costs incurred for upgrades benefiting all lots. Expenditures for repairs and maintenance and betterments for improvements shared with neighboring properties, are charged to rent expense as incurred.

For the ~~six~~nine months ended ~~April~~July 3031, 2018 and 2017, additional leasehold costs included in rent expense were $3457,~~468~~475 and $015,239, respectively.

Recently Issued Accounting Standards

In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718), Improvements to Nonemployee Share-based Payments (“ASU 2018-07”). This ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The effective date for the standard is for interim periods in fiscal years beginning after December 15, 2018, with early adoption permitted, but no earlier than the Company'’s adoption date of Topic 606. Under the new guidance, the measurement of nonemployee equity awards is fixed on the grant date. The new guidance is required to be applied retrospectively with the cumulative effect recognized at the date of initial application. The Company is currently evaluating the effect ASU 2018-07 will have on the consolidated financial statements.

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In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. The ASU modifies the disclosure requirements in Topic 820, Fair Value Measurement, by removing certain disclosure requirements related to the fair value hierarchy, modifying existing disclosure requirements related to measurement uncertainty and adding new disclosure requirements, such as disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and disclosing the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. This ASU is effective for public companies for annual reporting periods and interim periods within those annual periods beginning after December 15, 2019. The Company is currently evaluating the effect, if any, that the ASU will have on its consolidated financial statements.

11In ~~Table~~September 2017, the FASB has issued Accounting Standards Update (ASU) No. 2017-13, ”Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of ~~Contents~~Prior SEC Staff Announcements and Observer Comments.”The amendments in ASU No. 2017-13 amends the early adoption date option for certain companies related to the adoption of ASU No. 2014-09 and ASU No. 2016-02. The Company may still adopt using the public company adoption guidance in the related ASUs, as amended. The effective date is the same as the effective date and transition requirements for the amendments for ASU 2014-09 and ASU 2016-02.

In September 2017, the FASB has issued Accounting Standards Update (ASU) No. 2017-13, “Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of Prior SEC Staff Announcements and Observer Comments.” The amendments in ASU No. 2017-13 amends the early adoption date option for certain companies related to the adoption of ASU No. 2014-09 and ASU No. 2016-02. Both of the below entities may still adopt using the public company adoption guidance in the related ASUs, as amended. The effective date is the same as the effective date and transition requirements for the amendments for ASU 2014-09 and ASU 2016-02.

In May 2014, the FASB issued some accounting standards update which modifies the requirements for identifying, allocating, and recognizing revenue related to the achievement of performance conditions under contracts with customers. This update also requires additional disclosure related to the nature, amount, timing, and uncertainty of revenue that is recognized under contracts with customers. This guidance is effective for fiscal and interim periods beginning after December 15, 2017 and is required to be applied retrospectively to all revenue arrangements. The adoption of this guidance is not expected to have a significant impact on the Company’s consolidated financial statements.

In February 2017, the FASB has issued Accounting Standards Update (ASU) No. 2017-05, “ ”Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets.” The amendments clarify that a financial asset is within the scope of Subtopic 610-20 if it meets the definition of an in substance nonfinancial asset. The amendments also define the term in substance nonfinancial asset. The amendments clarify that nonfinancial assets within the scope of Subtopic 610-20 may include nonfinancial assets transferred within a legal entity to a counterparty. For example, a parent may transfer control of nonfinancial assets by transferring ownership interests in a consolidated subsidiary. A contract that includes the transfer of ownership interests in one or more consolidated subsidiaries is within the scope of Subtopic 610-20 if substantially all of the fair value of the assets that are promised to the counterparty in a contract is concentrated in nonfinancial assets. The amendments clarify that an entity should identify each distinct nonfinancial asset or in substance nonfinancial asset promised to a counterparty and derecognize each asset when a counterparty obtains control of it. Effective at the same time as the amendments in Update 2014-09, Revenue from Contracts with Customers (Topic 606). Therefore, public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the amendments in this Update to annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. All other entities should apply the amendments in this Update to annual reporting periods beginning after December 15, 2018, and interim periods within annual periods beginning after December 15, 2019.

In January 2017, the FASB has issued Accounting Standards Update (ASU) No. 2017-04, “ ”Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” These amendments eliminate Step 2 from the goodwill impairment test. The annual, or interim, goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In addition, income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. Effective for public business entities that are SEC filers for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. ASU 2017-04 should be adopted on a prospective basis. The Company does not anticipate the adoption of ASU 2017-04 will have a material impact on its consolidated financial statements.

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In January 2017, the FASB issued ASU No. 2017-01, “ ”Business Combinations (Topic 805): Clarifying the Definition of a Business.” This new standard clarifies the definition of a business and provides a screen to determine when an integrated set of assets and activities is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This new standard will be effective for the Company on January 1, 2018, however, early adoption is permitted with prospective application to any business development transaction.

Management has considered all recent accounting pronouncements issued. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.

NOTE 3 – GOING CONCERN

The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not established any source of revenue to cover its operating costs, and it does not have sufficient cash flow to maintain its operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

The Company expects to develop its business and thereby increase its revenue. However, the Company would require sufficient capital to be invested into the Company to acquire the properties to begin generating sufficient revenue to cover the monthly expenses of the Company. Until the Company is able to generate revenue, the Company would be required to raise capital through the sale of its stock or through debt financing. Management may raise additional capital through future public or private offerings of the Company’s stock or through loans from private investors, although there can be no assurance that it will be able to obtain such financing. The Company’s failure to do so could have a material and adverse effect upon it and its shareholders.

To this date the Company has relied on the sale of securities to finance its operations and growth. The Company expects to continue to fund the Company through debt and securities sales and issuances until the Company generates enough revenues through the operations. These transactions will initially be through related parties, such as the Company’s officers and directors.

NOTE 4 – RELATED PARTY TRANSACTIONS

Notes Payable

During the ~~three~~nine months ended ~~January~~July 31, 2018, the Company issued multiple 5% notes to a related party, for gross proceeds of $99,200. The notes are due on December 31, 2019. The notes accrue interest at 0% for the initial nine months and then 5% on annual rate thereafter.

During the year ended October 31, 2017, the Company issued a total of twenty-six (26) 5% notes to Novus Group, a related party, for gross proceeds of $363,200 and during the nine months ended July 31, 2018, the Company issued one note of $18,000 (together the “Novus Notes”). The Novus Notes contained maturity dates of December 31, 2018 and December 31, 2019. The Novus Notes accrue interest at 0% for the initial nine months and 5% on annual rate thereafter.

As of ~~April~~July 3031, 2018 and October 31, 2017, the long -term portion of notes payable were $~~272~~290,200 and $330,200, respectively, and the current portion of notes payable were $157,200 and $0, respectively. During the ~~six~~nine months ended ~~April~~July 3031, 2018 and 2017, the notes payable incurred interest expense of $36,~~109~~984 and $0, respectively.

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Due to Related Party

During the period beginning January, 2017 and ending in October, 2017, Valerie Baugher, an officer of the Company lent to the Company, pursuant to seven (7) total advancements, an aggregate of $7,173 for use as working capital, ~~(collectively~~and ~~the~~during ~~“Officer Loans”). During~~ the ~~six~~nine months ended ~~April~~July 3031, 2018, the Company received advances from an officer of the Company at the amount of $~~900~~11,637 and repaid to her $~~347~~14,522 (collectively the “Officer Loans”). The Officer Loans are due on demand and non-interest bearing. As of ~~April~~July 3031, 2018 and October 31, 2017, the total remaining due to the officer was $~~3,438~~0 and $2,885, respectively.

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NOTE 5 – CONVERTIBLE NOTES

The Company had the following principal balance under its convertible notes outstanding as of ~~April~~July 3031, 2018:

	April 30,
	July 31,
	2018
Convertible Notes - originated in December 2017	$	170,000
Convertible Notes - originated in February 2018		~~945~~1,055,000
		1,115,000
		1,225,000
Less debt discount and debt issuance cost		(~~829~~604,~~855~~144	)
		285,145
		620,856
Less current portion of convertible notes payable		(~~285~~620,~~145~~856	)
Long-term convertible notes payable	$	-

The Company recognized amortization expense related to the debt discount and deferred financing fees of $~~505~~827,~~145~~883 for the ~~six~~nine months ended ~~April~~July 3031, 2018, which is included in interest expense in the statements of operations.

For the ~~six~~nine months ended ~~April~~July 3031, 2018, the interest expense on convertible notes was $2758,~~479~~069, with repayment on accrued interest of $2,567 from a note settlement during the period. As of ~~April~~July 3031, 2018, the accrued interest payable was $2455,~~913~~503.

During the ~~six~~nine months ended ~~April~~July 3031, 2018, the Company repaid a convertible note of $220,000 and accrued interest of $2,567 for a total repayment of $276,356 and issuance of 15,000 shares of common stock valued at $31,500, resulting in repayment interest penalty of $85,~~290~~289.

~~Convertible~~Note ~~Notes~~in ~~– Issued during the six months ended April 30, 2018~~Default

~~During~~On ~~the~~July ~~six months ended April 30~~8, 2018, the ~~Company~~$170,000 convertible promissory note issued ~~convertible~~on ~~notes~~December in8, ~~the~~2017 ~~total~~went ~~principal~~into ~~amount~~default ofand ~~$1,335,000~~is inaccruing ~~exchange~~interest ~~for~~at ~~cash~~a ~~proceeds~~rate of ~~$1,152,250,~~22%. ~~after~~The ~~deducting~~note ~~original~~is ~~issuance~~now ~~discounts~~convertible ofat ~~$120,750~~a ~~and~~price ~~financing~~which ~~fees~~is the lower of $~~62,000~~0.90 ~~The~~per ~~convertible~~share ~~notes~~and ~~were~~the ~~also~~market ~~provided~~price ~~with~~on ~~warrants~~any toapplicable ~~purchase~~date upof toconversion. ~~211,883~~Certain ~~shares~~other ofreset ~~common~~provisions ~~stock~~and atpotential ~~exercise~~true ~~price~~up ofpolicies ~~$1.90~~are ~~per~~in ~~share.~~effect ~~The~~which ~~terms~~may materially increase the number of ~~convertible~~Common ~~notes~~shares ~~are~~to ~~summarized~~be asdelivered ~~follows:~~upon conversion.

Convertible Notes – Issued during the nine months ended July 31, 2018

During the nine months ended July 31, 2018, the Company issued convertible notes in the total principal amount of $1,445,000 in exchange for cash proceeds of $1,244,750, after deducting original issuance discounts of $130,750 and financing fees of $69,500. The convertible notes were also provided with warrants to purchase up to 211,883 shares of common stock at exercise price of $1.90 per share. The terms of convertible notes are summarized as follows:

	·	Term ranging from six months to one year. Notes expire on July 8, 2018 and February 13, 2019;
	·	Annual interest rates ranging from 10% to 12%;
	·	Convertible at the option of the holders at issuance; and
	·	Conversion prices are typically based on a fixed price ranging from $0.90 to $1.70. However, in the event the market capitalization falls below the minimum market capitalization at any time, the conversion price is the lower of the note fixed conversion price or the market price as of the applicable date of conversion.

~~The~~15 ~~Company~~Table ~~recognized amortization expense related to the debt discount and debt issuance cost~~ of ~~$196,767 for the six months ended April 30, 2018, which is included in interest expense in the statements of operations.~~Contents

For the six months ended April 30, 2018, the interest expense on the convertible note was $18,113. As of April 30, 2018, the accrued interest payable was $18,113.

NOTE 6 – DERIVATIVE LIABILITIES

The Company analyzed the conversion option for derivative accounting consideration under ASC 815, “ Derivatives and Hedging,” and determined that the convertible notes should be classified as a liability since the conversion option becomes effective at issuance resulting in there being no explicit limit to the number of shares to be delivered upon settlement of the above conversion options. The Company accounts for warrants and Series A Convertible Preferred Stock as a derivative liability due to there being no explicit limit to the number of shares to be delivered upon settlement of all conversion options.

14The ~~Table~~Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of ~~Contents~~July 31, 2018. The Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each convertible note and warrant is estimated using the Black-Scholes valuation model. The following weighted-average assumptions were used during the nine months ended July 31, 2018:

The Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of April 30, 2018. The Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each convertible note and warrant is estimated using the Black-Scholes valuation model. The following weighted-average assumptions were used during the six months ended April 30, 2018:

	Nine months ended
	July 31,
	2018
Expected term	0.19 - 1 years
Expected average volatility	180%-268		%
Expected dividend yield		-
Risk-free interest rate	1.64%-2.44		%

		Six months ended
		April 30,
		2018
Expected term		0.58 - 1 years
Expected average volatility		180% - 268%
Expected dividend yield		-
Risk-free interest rate		1.64% - 2.14%

The following table summarizes the derivative liabilities included in the balance sheet at July 31, 2018:

The following table summarizes the derivative liabilities included in the balance sheet at April 30, 2018:

Fair Value Measurements Using Significant Observable Inputs (Level 3)
Balance - October 31, 2017	$	-
Addition of new derivative liabilities recognized upon issuance of convertible notes and warrants as debt discount		1,231,778
Addition of new derivative liabilities recognized as day one loss on derivatives		1,043,494
Gain on change in fair value of the derivative liabilities		(1,024,912	)
Balance - July 31, 2018	$	1,250,360

Fair Value Measurements Using Significant Observable Inputs (Level 3)
Balance - October 31, 2017	$	-
Addition of new derivative liabilities recognized upon issuance of convertible notes and warrants as debt discount		1,152,250
Addition of new derivative liabilities recognized as day one loss on derivatives		1,043,494
Gain on change in fair value of the derivative liabilities		(1,266,872	)
Balance - April 30, 2018	$	928,872

The following table summarizes the loss on derivative liability included in the income statement for the nine months ended July 31, 2018.

The following table summarizes the gain on derivative liability included in the income statement for the six months ended April 30, 2018.

	Nine months ended
	July 31,
	2018
Addition of new derivative liabilities recognized as day one loss on derivatives	$	1,043,494
Gain on change in fair value of the derivative liabilities		(1,024,912	)
	$	18,582

	Six months ended
	April 30,
	2018
Addition of new derivative liabilities recognized as day one loss on derivatives from convertible notes	$	1,043,494
Gain on change in fair value of the derivative liabilities		(1,266,872	)
	$	(223,378	)

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NOTE 7 – DIVIDEND PAYABLE

On August 22, 2017, the Company declared a dividend, in the aggregate amount of $50,672, payable to the Common shareholders. On August 30, 2017, the Company filed with FINRA its corporate notice for a cash dividend. Of the total amount of the declared dividend, the amount of $4,463 was paid out to the Common shareholders.

On February 26, 2018, the Company’s Board of Directors approved a cash dividend payable to the Common shareholders and Series A Preferred shareholders. The record date for the dividend of $51,387 was March 31, 2018 at a rate of $0.001 per share.

AsDuring ofthe ~~April~~nine ~~30,~~months ~~2018~~ended ~~and~~July ~~October~~ 31, ~~2017~~2018, the ~~aggregate~~amount ~~dividend~~of ~~payable~~$6,843 towas ~~Common~~paid ~~and~~out ~~Series~~to Athe ~~Preferred~~ shareholders ~~was $46,029~~.

15As ~~Table~~ of ~~Contents~~July 31, 2018 and October 31, 2017, the aggregate dividend payable to Common and Series A Preferred shareholders was $90,572 and $46,029.

NOTE 8 – STOCKHOLDERS’ EQUITY

Preferred Stock

The Company has authorized 15,000,000 shares of Preferred Stock with a par value of $0.0001 per share. The Board of Directors is authorized to divide the authorized shares of Preferred Stock into one or more series, each of which shall be so designated as to distinguish the shares thereof from the shares of all other series and classes.

The Company has authorized 15,000,000 preferred shares with a par value of $0.0001 per share. The Board of Directors is authorized to divide the authorized shares of Preferred Stock into one or more series, each of which shall be so designated as to distinguish the shares thereof from the shares of all other series and classes.

Series A Preferred Stock

The Company has designated 4,600,000 shares of Series A Convertible Preferred Stock. The Series A Preferred Stock may convert into Common Stock at a rate equal to 10 shares of ~~common~~Common ~~stock~~Stock for each share of Series A Preferred stock. Each Series A Preferred shareholder is entitled to vote, on par with the Common shareholders, one (1) vote for each share of Common Stock into which a Series A Preferred share may be converted. In the event that any cash dividend on the Common Stock is declared by the Board, the Board shall simultaneously declare a dividend for each share of Series A Preferred Stock in an amount equal to the product of (i) the per share dividend declared and to be paid in respect of each share of Common Stock and (ii) the amount of common stock the Series A Preferred Stock is convertible into under the designation.

As at ~~April~~July 3031, 2018 and October 31, 2017, the Company had 4,600,000 shares of Series A Preferred Stock issued and outstanding.

Series B Preferred Stock

The Company has designated 8,000,000 shares of Series B Preferred Stock, with a face value of $1.00 per share. The Series B Preferred Stock has no conversion rights or no voting rights. The shareholders of the Series B Preferred will be entitled to a payment of $200 per pound that the Company harvests from its cultivation operations, which is divided by the outstanding shares of the Series B preferred shares.

As at ~~April~~July 3031, 2018 and October 31, 2017, the Company had no shares of Series B Preferred Stock issued and outstanding.

Series C Preferred Stock

The Company has designated 500,000 shares of Series C Convertible Preferred Stock. The Series C Preferred Stock has no voting rights. The Series C Preferred Stock may convert into Common Stock at a rate equal to 10 shares of common stock for each share of Series C Preferred stock. Each Series C Preferred shareholder is entitled to vote, on par with the Common shareholders, one (1) vote for each share of Common Stock into which a Series C Preferred share may be converted. In the event that any cash dividend on the Common Stock is declared by the Board, the Board shall simultaneously declare a dividend for each share of Series C Preferred Stock in an amount equal to the product of (i) the per share dividend declared and to be paid in respect of each share of Common Stock and (ii) the amount of common stock the Series C Preferred Stock is convertible into under the designation.

As at ~~April~~July 3031, 2018 and October 31, 2017, the Company had no shares of Series C Preferred Stock issued and outstanding.

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Common Stock

As a result of an amendment to the Company’s Articles of Incorporation filed with the Colorado Secretary of State’s office on March 14, 2018, SIGO has authorized 27,000,000 ~~common~~ shares of Common Stock with a par value of $0.0001 per share. Each Common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.

During the ~~six~~nine months ended ~~April~~July 3031, 2018, the Company issued 500,000 shares of ~~common~~Common ~~stock~~Stock for $50,000 recorded as subscription received at October 31, 2017.

On February 20, 2018, the Company issued 15,000 shares of ~~common~~Common ~~stock~~Stock valued at $31,500 to Auctus Funds, LLC as partial repayment for the convertible note issued on February 1, 2018.

As at ~~April~~July 3031, 2018 and October 31, 2017, the Company had 5,386,771 and 4,871,771 shares of Common Stock issued and outstanding, respectively.

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Warrants Exercisable to Common Shares

The below table summarizes the activity of warrants exercisable for common shares during the ~~six~~nine months ended ~~April~~July 3031, 2018:

	Numberof Shares		Weighted- Average Exercise Price
	Number of Shares		Weighted- Average Exercise Price
Balances as of October 31, 2017		-	$	-
Granted		~~211~~1,~~883~~210,762		1.90
Exercised		-		-
Forfeited		-		-
Balances as of April 30, 2018		211,883	$	1.90
Balances as of July 31, 2018		1,210,762	$	1.90

The fair value of each warrant on the date of grant is estimated using the Black-Scholes option valuation model. The following weighted-average assumptions were used for options granted during the period ended ~~April~~July 3031, 2018:

	Six months ended
	Nine months ended
	April 30,
	July 31,
	2018
Exercise price	$	1.90
Remaining contractual term	4.54–5 years	5
Expected average volatility	~~280~~262% - 293%		%
Expected dividend yield		-
Risk-free interest rate	2.60% - 2.79%		%

The following table summarizes information relating to outstanding and exercisable warrants as of ~~April~~July 3031, 2018:

Warrants Outstanding						Warrants Exercisable
		Weighted Average
Number		Remaining Contractual		Weighted Average		Number		Weighted Average
of Shares		life (in years)		Exercise Price		of Shares		Exercise Price
	211,883		4.79	$	1.90		211,883		1.90
	1,210,762		4.54	$	1.90		1,210,762		1.90

~~Aggregate~~18 ~~intrinsic~~Table ~~value is the sum~~ of the amounts by which the quoted market price of the Company’s stock exceeded the exercise price of the warrants at April 30, 2018 for those warrants for which the quoted market price was in excess of the exercise price (“in-the-money” warrants). As of April 30, 2018, the aggregate intrinsic value of warrants outstanding was approximately $0 based on the closing market price of $0.8395 on April 30, 2018.Contents

Aggregate intrinsic value is the sum of the amounts by which the quoted market price of the Company’s Common Stock exceeded the exercise price of the warrants at July 31, 2018 for those warrants for which the quoted market price was in excess of the exercise price (“in-the-money” warrants). As of July 31, 2018, the aggregate intrinsic value of warrants outstanding was approximately $0 based on the closing market price of $0.4225 on July 31, 2018.

The Company determined that the warrants qualify for derivative accounting as a result of the related issuances of convertible notes, which led to no explicit limit to the number of shares to be delivered upon future settlement of the conversion options (see Note 6).

17 Table of Contents

Additional Paid in Capital

During the ~~six~~nine months ended ~~April~~July 3031, 2018, the Company’s officer contributed additional paid in capital in the amount of $7879,~~493~~068.

NOTE 9 – COMMITMENTS AND CONTINGENCIES

On March 1, 2017, the Company executed a lease for 12,000 square feet green house space and 1,000 square of warehouse space expiring March 31, 2020. The base lease amount is $79,~~000~~576 per month. On May 1, 2017, the Company executed a lease for 10,000 square feet of open land expiring June 30, 2020. The base lease amount is $2,576 per month. Any amounts expended by the Landlord for maintenance, repairs or improvements deemed to be our responsibility are added to our monthly lease amount as additional rent. During the ~~six~~nine months ended ~~April~~July 3031, 2018 and 2017, we incurred total lease expenses of $6975,~~312~~564 and $29,000, respectively.

The Company has aggregate future minimum lease commitments as of ~~April~~July 3031, 2018, as follows:

Year ending October 31,
2018	$	5728,~~456~~728
2019		114,912
2020		55,608
Total	$	~~227~~199,~~976~~248

NOTE 10 – SUBSEQUENT EVENTS

On July 8, 2018, the $170,000 convertible promissory note to St. George Investments, LLC issued on December 8, 2017 went into default and is accruing interest at a rate of 22%. The note is now convertible at a price which is the lower of $0.90 per share and the market price on any applicable date of conversion. Certain other reset provisions and potential true up policies are in effect which may materially increase the number of Common shares to be delivered upon conversion.

On March 2, 2018. the Company agreed to terms with REI Extracts regarding an extraction and distribution joint venture conducted under the Company’s licenses. To carry out the purposes of the joint venture, REI delivered equipment to SIGO’s facilities to conduct extraction tests. Additionally, REI Extracts also provided consulting services related to cultivation and provided a master grower. The new master grower originally began working with the Company in January 2018. The Company agreed to pay the grower based on the yield of sellable flower per warehouse bay, as follows:

Harvested pounds per bay of sellable flower	Incentive Bonus
0-40	$0	0
40-60	$~~40 per pound in excess of 40 pounds~~	40 per pound in excess of 40 pounds
60-80	$~~70 per pound in excess of 40 pounds~~	70 per pound in excess of 40 pounds
80-100	$~~100 per pound in excess of 40 pounds~~	100 per pound in excess of 40 pounds
100+	$~~120 per pound in excess of 40 pounds~~	120 per pound in excess of 40 pounds

In December, 2018, SIGO and REI Extracts mutually agreed to terminate their joint venture. All equipment delivered by REI Extracts was removed by REI Extracts and the Company ceased utilizing the master grower provided by REI Extracts.

18 Table of Contents

On November 30, 2018, pursuant to a purchase agreement entered into by and between SIGO and Job Growing, Inc. (“Job Growing”) the Company issued 333,000 shares of Series C Preferred Stock, valued at $1,000,000, to Job Growing, in exchange for the rights to 50% of the net profits of Job Growing. In the event that Job Growing either: (i) files a registration statement, with the Securities and Exchange Commission (the “SEC”), to become a reporting company under the Securities Exchange Act of 1934; or (ii) is acquired by an unrelated third party, then SIGO has the right to buy a fifty percent (50%) equity interest in Job Growing for the additional consideration of one and no/100 dollar ($1.00).

Table of Contents

On September 17, 2019 Job Growing notified the Company of its intent to terminate the agreement between Job Growing and the Company effective immediately.

On August 15, 2019, the Company received a true up notice from Job Growing to issue 576,091 shares of Series C Preferred Stock to Job Growing valued at $633,700, pursuant to the terms of the purchase agreement signed on November 30, 2018.

On January 15, 2019, BMG was fined approximately $35,000 for not having Worker'’s Compensation insurance for the months of January 2018 - April 2018. The Company believes this is a fine owed by BMG and is not a liability due to the Company, as we transferred ownership of BMG during December 2017, to T.J. Magallanes, the Company'’s former CEO (see Note 1). VBF Brands, the Company'’s operating entity, has worker’s compensation and was not subject to the fine. The Company ceased operating BMG in December 2017.

On February 11, 2019, pursuant to a purchase agreement entered into by and between SIGO and Cicero Travel Group, Inc. (“Cicero Travel”) the Company issued 333,000 shares of Series C Preferred Stock, valued at $1,000,000, to Cicero Travel, in exchange for the rights to receive 33% of the net profits of Cicero Travel, 19% of the issued and outstanding shares of the common stock of Cicero Travel and the right to purchase an additional 14% of the issued and outstanding shares of the common stock of Cicero Travel.

On August 19, 2019, the Company received a true up notice from Cicero Travel to issue 486,672 shares of Series C Preferred Stock to Cicero Travel valued at $593,740, pursuant to the terms of the purchase agreement signed on February 11, 2019. The Company believes the true up notice is without merit, that Cicero Travel has not met its obligations under the purchase agreement and SIGO intends to cancel the previously issued shares of Series C Preferred Stock and will not be issuing any additional shares of Series C Preferred Stock to Cicero Travel.

Subsequent to ~~April~~July 3031, 2018 and through the date that these financials were issued, the Company received net proceeds of $1934,~~034,~~400, net of total OID of $~~103~~93,440, from St. George investments in ~~regards~~regard to the purchase agreement and convertible note of $4,245,000 executed on February 13, 2018.

19On ~~Table~~January 21, 2019 Valerie Baugher transferred 4,600,000 shares of ~~Contents~~Series A Preferred Stock held by her, and which constituted Ms. Baugher’s entire holdings in the Company and resigned as the Company’s President/CEO and sole Director. Ms. Baugher transferred her Series A Preferred Stock to Mr. Ray Chacon who, at that time, became the Company’s President/CEO and sole Director.

~~Item~~The 2Company’s wholly-owned subsidiary, VBF Brands, has had its business license suspended by the California Franchise Tax Board (the “ FTB”). ~~Management's~~The ~~Discussion~~Company and ~~Analysis~~VBF ofare ~~Financial~~currently ~~Condition~~in orthe ~~Plan~~process of ~~Operation~~working with the FTB to return VBF to good standing and the Company expects VBF to return to good standing with the FTB in the near future.

~~FORWARD-LOOKING~~20 ~~STATEMENTS~~Table of Contents

~~This~~Item ~~quarterly report contains forward-looking statements~~2. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industryManagement’s ~~actual~~Discussion ~~results,~~and ~~levels~~Analysis of ~~activity,~~Financial ~~performance~~Condition orand ~~achievements~~Results ~~to be materially different from any future results, levels~~ of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.Operations

Our interim unaudited consolidated financial statements are prepared in accordance with United States Generally Accepted Accounting Principles (“GAAP”). The following discussion should be read in conjunction with our condensed consolidated financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forwardFORWARD-~~looking~~LOOKING statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.STATEMENTS

InThis ~~this~~ quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, ~~unless~~you ~~otherwise~~can ~~specified~~identify forward-looking statements by terminology such as “may”, ~~all~~“should”, ~~dollar~~“expects”, ~~amounts~~“plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, ~~dollars~~we ~~and~~do ~~all~~not ~~references~~intend to ~~“common~~update ~~shares”~~any ~~refer~~of to the ~~common~~forward-looking ~~shares~~statements into ~~our~~conform ~~capital~~these ~~stock~~statements to actual results.

AsOur ~~used~~unaudited financial statements are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report,. ~~the~~The ~~terms~~following ~~“we”,~~discussion ~~“us”,~~contains “forward-looking statements that reflect our” plans, estimates and ~~“our~~beliefs. ~~Company”~~Our ~~mean~~actual ~~Sunset~~results ~~Island~~could ~~Group,~~differ ~~Inc~~materially from those discussed in the forward-looking statements. ~~and~~Factors ~~our~~that ~~wholly~~could ~~owned~~cause ~~subsidiary,~~or ~~VBF~~contribute ~~Brands,~~to ~~Inc.~~such differences include, abut ~~California~~are ~~corporation~~not limited to, ~~unless~~those ~~otherwise~~discussed ~~indicated~~below and elsewhere in this quarterly report.

~~General~~In ~~Overview~~this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the common shares in our capital stock.

~~Sunset~~As ~~Island~~used ~~Group,~~in ~~Inc.~~this ~~(“SIGO”~~quarterly orreport, the terms “~~Company~~we”), ~~was~~“us”, ~~originally~~“our” ~~incorporated~~and in“our ~~the~~Company” ~~State~~mean ofSunset ~~Colorado~~Island ~~on September 29~~Group, ~~2005 as Gulf West Property,~~ Inc. Onand ~~October~~our ~~25,~~wholly ~~2005~~owned ~~the~~subsidiary, ~~Company~~VBF ~~changed its name to Titan Global Entertainment~~Brands, Inc., Ona ~~May~~California 7corporation, ~~2008,~~unless ~~the~~otherwise ~~Company changed its name to Sunset Island Group, Inc~~indicated.

~~Our~~General ~~business and corporate address is 20420 Spence Rd., Salinas, CA 93908, our phone number is (424) 239-6230. Our corporate website is www.sunsetislandgroup.com/.~~Overview

~~Until~~Sunset ~~December~~Island 31Group, ~~2017, we operated our business through our then wholly owned subsidiary, Battle Mountain Genetics,~~ Inc., ~~a California corporation~~ (“~~BMG~~SIGO”). ~~The Company currently conducts its business operations through its wholly owned subsidiary VBF Brands, Inc. ("VBF Brands"~~ or the “~~VBF~~Company”). ~~VBF Brands operated as a nonprofit mutual benefit entity until December 21, 2017 when it~~ was ~~converted~~originally toincorporated ain ~~for~~the ~~profit~~State ~~entity.~~of ~~Prior~~Colorado toon ~~December~~September 2129, ~~2017,~~2005 ~~VBF Brands operated~~ as aGulf ~~collective~~West ~~pursuant~~Property, ~~to California’s Compassionate Use Act~~Inc. ~~Upon~~On ~~the~~October ~~conversion~~25, of2005 ~~VBF Brands to a for profit entity~~ the Company ~~began~~changed ~~operating all of~~ its ~~cannabis~~name ~~related~~to ~~business~~Titan ~~through~~Global ~~VBF~~Entertainment, ~~Brands and BMG ceased active operations~~Inc. ~~One~~On ~~hundred~~May ~~percent~~7, of2008, the ~~issued~~Company ~~and~~changed ~~outstanding~~its ~~shares~~name ofto ~~BMG’s~~Sunset ~~capital~~Island ~~stock was transferred~~Group, ~~in December, 2017 to T~~Inc.~~J. Magallanes, a former officer and director of SIGO.~~

WeOur ~~have~~business ~~one~~and ~~subsidiary,~~corporate ~~VBF~~address ~~Brands,~~is ~~Inc~~20420 Spence Rd., aSalinas, ~~California~~CA 93908, ~~corporation~~our phone number is (424) 239-6230. Our corporate website is www.sunsetislandgroup.com.

WeUntil ~~have~~December ~~never~~31, ~~declared~~2017, ~~bankruptcy~~we operated our business through our then wholly owned subsidiary, ~~been~~Battle inMountain ~~receivership~~Genetics, Inc., a California corporation (“BMG”). The Company currently conducts its business operations through its wholly owned subsidiary VBF Brands, Inc. (“VBF Brands” or ~~involved~~“VBF”). inVBF ~~any~~Brands ~~kind~~operated as a nonprofit mutual benefit entity until December 21, 2017 when it was converted to a for profit entity. Prior to December 21, 2017, VBF Brands operated as a collective pursuant to California’s Compassionate Use Act. Upon the conversion of ~~legal~~VBF ~~proceeding~~Brands to a for profit entity the Company began operating all of its cannabis related business through VBF Brands and BMG ceased active operations. One hundred percent of the issued and outstanding shares of BMG’s capital stock was transferred, in December, 2017 to T.J. Magallanes, a former officer and director of SIGO.

~~Our~~We ~~Current~~have ~~Business~~one subsidiary, VBF Brands, Inc., a California, corporation.

~~Our~~We ~~principal~~have ~~line~~never ofdeclared ~~business is the growing~~bankruptcy, ~~cultivation,~~been ~~production~~in ~~and distribution of adult and medicinal cannabis~~receivership.

20Our ~~Table~~Current ~~of Contents~~Business

~~The~~Our ~~Company~~principal ~~currently~~line ~~leases~~of ~~the~~business ~~following~~is ~~real~~the ~~property in Northern California: greenhouse space of approximately 12~~growing,~~000~~ ~~square feet; vacant land of approximately 10~~cultivation,~~000~~ ~~square~~production ~~feet that can developed for additional greenhouse use;~~ and ~~2,400~~distribution ~~square~~of ~~feet~~adult ~~for drying, curing, manufacturing, trimming~~ and ~~distribution~~medicinal ~~activities~~cannabis.

~~Federal~~The ~~Regulation~~Company currently leases the following real property in Northern California: greenhouse space of approximately 12,000 square feet; vacant land of approximately 10,000 square feet that can developed for additional greenhouse use; and 2,400 square feet for drying, curing, manufacturing, trimming and distribution activities.

~~The~~21 ~~Company,~~Table ~~by and through VBF (a wholly owned subsidiary) engages in the direct growth, cultivation, harvesting and distribution~~ of ~~cannabis containing psychoactive amounts of the THC molecule, for use in the medicinal cannabis industry~~Contents

~~Cannabis~~Federal is illegal under federal law and is a “Schedule 1” drug under the Controlled Substances Act (21 U.S.C. § 811) (the “CSA”). As a Schedule 1 drug, cannabis is viewed as being highly addictive and having no medical value. The United States Drug Enforcement Agency (“DEA”) enforces the CSA, and persons violating it are subject to federal criminal prosecution. The criminal penalty structure in the CSA is determined based on the specific predicate violations, including but not limited to: simple possession, drug trafficking, attempt and conspiracy, distribution to minors, trafficking in drug paraphernalia, money laundering, racketeering, environmental damage from illegal manufacturing, continuing criminal enterprise, and smuggling. A first conviction under the CSA can generally result in possible fines from $250,000 to $50 million dollars, and incarceration for periods generally from five and up to forty years. For a second conviction, fines increase generally from $500,000 to $75 million dollars, and incarceration for periods generally from ten years to twenty years to life.Regulation

The ~~federal~~Company, ~~government~~by ~~recently~~and ~~issued~~through ~~guidance~~VBF to(a ~~federal~~wholly-owned ~~prosecutors~~subsidiary) ~~concerning~~engages ~~marijuana~~in ~~enforcement under~~ the ~~CSA.~~direct ~~On January 4~~growth, ~~2018~~cultivation, ~~Attorney~~harvesting ~~General~~and ~~Jeff~~distribution ~~Sessions~~of ~~issued a memorandum for all United States Attorneys concerning federal~~ cannabis ~~enforcement~~containing ~~generally.~~psychoactive ~~The~~amounts ~~Department~~ of ~~Justice (~~the ~~“DOJ”)~~THC ~~rescinded all previous prosecutorial guidance issued by it regarding cannabis~~molecule, ~~including~~for ~~the~~use ~~August~~in ~~29, 2013 memorandum by James Cole, then Deputy Attorney General (~~the ~~“Cole~~medicinal ~~Memorandum”).~~cannabis industry

~~The~~Cannabis ~~Cole~~is ~~Memorandum~~illegal ~~previously~~under ~~set~~federal ~~out~~law ~~the~~and ~~DOJ’s~~is ~~prosecutorial~~a ~~priorities~~“Schedule in1” ~~light~~drug ofunder ~~various~~the ~~states~~Controlled ~~legalizing~~Substances ~~cannabis~~Act ~~for~~(21 ~~medicinal~~U.S.C. ~~and/or~~§ ~~recreational~~811) ~~use~~(the “CSA”). ~~The~~As ~~Cole~~a ~~Memorandum~~Schedule ~~provided~~1 ~~that~~drug, ~~when~~cannabis ~~states~~is ~~have~~viewed ~~implemented~~as ~~strong~~being ~~and~~highly ~~effective~~addictive ~~regulatory~~ and ~~enforcement~~having ~~systems~~no tomedical ~~control~~value. ~~the~~The ~~cultivation,~~United ~~distribution,~~States ~~sale,~~Drug ~~and~~Enforcement ~~possession~~Agency of(“DEA”) ~~cannabis,~~enforces ~~conduct~~the inCSA, ~~compliance with those laws~~ and ~~regulations~~persons isviolating ~~less~~it ~~likely~~are subject to ~~threaten the~~ federal ~~priorities~~criminal prosecution. AThe ~~strong~~criminal ~~and~~penalty ~~effective~~structure ~~regulatory~~in ~~system, according to~~ the ~~Cole~~CSA ~~Memorandum,~~is ~~would~~determined ~~affirmatively~~based ~~address~~on ~~federal~~the ~~priorities~~specific ~~by,~~predicate ~~for example~~violations, ~~implementing~~including ~~effective~~but ~~measures~~not limited to: ~~prevent~~simple ~~diversion~~possession, ofdrug ~~cannabis~~trafficking, ~~outside~~attempt ~~of the regulated system~~ and ~~to other states~~conspiracy, ~~prohibiting~~distribution ~~access~~ to ~~cannabis by~~ minors, ~~and~~trafficking ~~replacing~~in andrug ~~illicit~~paraphernalia, ~~cannabis~~money ~~trade~~laundering, ~~that~~racketeering, ~~funds~~environmental ~~criminal~~damage ~~enterprises~~from ~~with~~illegal amanufacturing, ~~tightly~~continuing ~~regulated~~criminal ~~market~~enterprise, ~~in which revenues are tracked~~ and ~~accounted for~~smuggling. InA ~~such~~first ~~circumstances,~~conviction ~~consistent~~under ~~with~~ the ~~traditional~~CSA ~~allocation~~can ofgenerally ~~federal-state~~result ~~efforts~~ in ~~this~~possible ~~area,~~fines ~~the~~from ~~Cole~~$250,000 ~~Memorandum~~to ~~provided~~$50 ~~that~~million ~~enforcement~~dollars, ofand ~~state~~incarceration ~~law~~for byperiods ~~state~~generally ~~and~~from ~~local~~five ~~law enforcement~~ and ~~regulatory~~up ~~bodies~~to ~~should~~forty ~~remain the primary means of addressing cannabis-related activity~~years. IfFor ~~state~~a ~~enforcement~~second ~~efforts~~conviction, ~~did~~fines ~~not~~increase ~~protect~~generally ~~against~~from ~~the~~$500,000 ~~harms~~to ~~set~~$75 ~~forth~~million ~~above~~dollars, ~~the~~and ~~federal~~incarceration ~~government~~for ~~could~~periods ~~seek~~generally tofrom ~~challenge~~ten ~~the~~years ~~regulatory~~to ~~structure~~twenty ~~itself~~years ~~in addition~~ to ~~continuing to bring individual enforcement actions, including criminal prosecutions, focused on those harms~~life.

The ~~rescission~~federal ofgovernment ~~the~~recently ~~Cole~~issued ~~Memorandum~~guidance ~~created~~to ~~material~~federal ~~uncertainty~~prosecutors asconcerning itmarijuana ~~relates~~enforcement tounder ~~how~~ the ~~DOJ~~CSA. ~~will~~On ~~evaluate~~January ~~cannabis~~4, ~~cases~~2018, Attorney General Jeff Sessions issued a memorandum for ~~prosecution~~all ~~and~~United ~~introduced~~States ~~risk~~Attorneys ~~into~~concerning federal cannabis enforcement generally. The Department of Justice (the ~~Company’s~~“DOJ”) ~~business~~rescinded asall previous prosecutorial guidance issued by it ~~relates~~regarding tocannabis, including the ~~research,~~August ~~growth~~29, ~~cultivation,~~2013 ~~development,~~memorandum ~~manufacturing~~by James Cole, ~~marketing~~then ~~and~~Deputy ~~sale~~Attorney ofGeneral ~~its~~(the ~~cannabis~~“Cole ~~products~~Memorandum”).

~~Current~~The ~~guidance~~Cole ~~requires~~Memorandum ~~U.S.~~previously ~~Attorneys~~set toout ~~decide~~the ~~whether~~DOJ’s prosecutorial priorities in light of various states legalizing cannabis for medicinal and/or ~~not~~recreational use. The Cole Memorandum provided that when states have implemented strong and effective regulatory and enforcement systems to ~~pursue~~control ~~prosecution~~the cultivation, distribution, sale, and possession of cannabis, ~~activity~~conduct ~~based~~in ~~upon~~compliance ~~factors~~with ~~including:~~those ~~the~~laws ~~seriousness~~and ofregulations is less likely to threaten the ~~crime~~federal priorities. A strong and effective regulatory system, according to the ~~deterrent~~Cole ~~effect~~Memorandum, ofwould ~~criminal~~affirmatively ~~prosecution~~address federal priorities by, ~~and~~for ~~the~~example, ~~cumulative~~implementing ~~impact~~effective measures to prevent diversion of ~~particular~~cannabis ~~crimes~~outside onof the ~~community.~~regulated ~~The~~system ~~guidance~~and ~~reiterates~~to other states, prohibiting access to cannabis by minors, and replacing an illicit cannabis trade that funds criminal enterprises with a tightly regulated market in which revenues are tracked and accounted for. In such circumstances, consistent with the ~~cultivation~~traditional allocation of federal-state efforts in this area, ~~distribution~~the Cole Memorandum provided that enforcement of state law by state and ~~possession~~local law enforcement and regulatory bodies should remain the primary means of addressing cannabis-related ~~continues~~activity. toIf bestate aenforcement ~~crime~~efforts ~~under~~did not protect against the ~~CSA~~harms set forth above, the federal government could seek to challenge the regulatory structure itself in addition to continuing to bring individual enforcement actions, including criminal prosecutions, focused on those harms.

OnThe ~~March~~rescission ~~23,~~of ~~2018,~~the ~~President~~Cole ~~Donald~~Memorandum J.created ~~Trump~~material ~~signed~~uncertainty ~~into~~as ~~law~~it arelates ~~$1.3~~to ~~trillion-dollar~~how ~~spending~~the ~~bill~~DOJ ~~that~~will ~~included~~evaluate ancannabis ~~amendment~~cases ~~known~~for asprosecution ~~“Rohrabacher-Blumenauer,”~~and ~~which~~introduced ~~prohibits~~risk into the ~~DOJ~~Company’s ~~from~~business ~~using~~as ~~federal~~it ~~funds~~relates to ~~prevent~~the ~~certain~~research, ~~states~~growth, ~~“from~~cultivation, ~~implementing their own State laws that authorize the use~~development, ~~distribution~~manufacturing, ~~possession~~marketing orand ~~cultivation~~sale of ~~medical~~its ~~marijuana~~cannabis products.”

21Current ~~Table~~guidance requires U.S. Attorneys to decide whether or not to pursue prosecution of ~~Contents~~cannabis activity based upon factors including: the seriousness of the crime, the deterrent effect of criminal prosecution, and the cumulative impact of particular crimes on the community. The guidance reiterates that the cultivation, distribution and possession of cannabis continues to be a crime under the CSA.

~~The~~On ~~United~~March ~~States~~23, ~~Food~~2018, &President ~~Drug~~Donald ~~Administration~~J. ~~(the~~Trump ~~“FDA”)~~signed isinto ~~generally~~law ~~responsible~~a ~~for~~$1.3 ~~protecting~~trillion-dollar ~~the~~spending ~~public~~bill ~~health~~that byincluded ~~ensuring~~an ~~the~~amendment ~~safety,~~known ~~efficacy~~as “Rohrabacher-Blumenauer,” ~~and~~which ~~security~~prohibits ~~of (1) prescription and over~~ the ~~counter~~DOJ ~~drugs;~~from ~~(2)~~using ~~biologics~~federal ~~including~~funds ~~vaccines,~~to ~~blood~~prevent &certain ~~blood~~states ~~products,~~“from ~~and~~implementing ~~cellular~~their ~~and~~own ~~gene~~State ~~therapies;~~laws ~~(3)~~that ~~foodstuffs~~authorize ~~including~~the ~~dietary supplements~~use, ~~bottled water~~distribution, ~~and~~possession ~~baby~~or ~~formula;~~cultivation ~~and,~~of ~~(4)~~ medical ~~devices including heart pacemakers, surgical implants, prosthetics, and dental devices~~marijuana.”

~~Regarding~~The ~~its~~United ~~regulation~~States ofFood ~~drugs,~~& Drug Administration (the “FDA”) ~~process~~is ~~requires~~generally aresponsible ~~review~~for ~~that~~protecting ~~begins~~the ~~with~~public health by ensuring the ~~filing~~safety, efficacy, and security of an(1) ~~“Investigational~~prescription ~~New~~and ~~Drug”~~over the counter drugs; (~~IND~~2) ~~application,~~biologics ~~with~~including ~~follow~~vaccines, onblood ~~clinical~~& ~~studies~~blood products, and ~~clinical~~cellular ~~trials~~and ~~that~~gene ~~the~~therapies; ~~FDA~~(3) ~~uses~~foodstuffs toincluding ~~determine~~dietary ~~whether~~supplements, abottled ~~drug~~water, isand ~~safe~~baby ~~and~~formula; ~~effective~~and, ~~and~~(4) ~~therefore~~medical ~~subject~~devices toincluding ~~approval~~heart ~~for~~pacemakers, ~~human~~surgical ~~use~~implants, byprosthetics, ~~the~~and ~~FDA~~dental devices.

~~Aside~~22 ~~from~~Table ~~the FDA’s mandate to regulate drugs, the FDA also regulates dietary supplement products and dietary ingredients under the Dietary Supplement Health and Education Act~~ of 1994. This law prohibits manufacturers and distributors of dietary supplements and dietary ingredients from marketing products that are adulterated or misbranded. This means that these firms are responsible for evaluating the safety and labeling of their products before marketing to ensure that they meet all the requirements of the law and FDA regulations, including, but not limited to the following labeling requirements: (1) identifying the supplement; (2) nutrition labeling; (3) ingredient labeling; (4) claims; and, (5) daily use information.Contents

~~The~~Regarding ~~FDA~~its ~~has~~regulation ~~not~~of ~~approved~~drugs, ~~cannabis~~the asFDA aprocess ~~safe~~requires ~~and~~a ~~effective~~review ~~drug~~that ~~for~~begins ~~any~~with ~~indication.~~the Asfiling of ~~the~~an ~~date~~“Investigational ofNew ~~this~~Drug” ~~filing~~(IND) application, wewith ~~have~~follow ~~not,~~on clinical studies and doclinical ~~not~~trials ~~intend~~that the FDA uses to ~~file~~determine anwhether ~~IND~~a ~~with~~drug ~~the~~is ~~FDA~~safe and effective, ~~concerning~~and ~~any~~therefore ofsubject ~~our~~to ~~cannabis~~approval ~~products~~for human use by the FDA.

~~The~~Aside from the FDA’s ~~has~~mandate ~~concluded~~to ~~that~~regulate ~~cannabis~~drugs, isthe ~~excluded~~FDA ~~from~~also ~~the~~regulates dietary supplement ~~definition~~products ~~under sections 201(ff)(3)(B)(i)~~ and ~~(ii)~~dietary ofingredients under the ~~U.S.~~Dietary ~~Food,~~Supplement ~~Drug~~Health &and ~~Cosmetic~~Education Act, ~~respectively~~of 1994. ~~The~~This ~~FDA’s~~law ~~position~~prohibits ismanufacturers ~~that~~and ~~because~~distributors ~~cannabis~~of isdietary asupplements ~~Schedule~~and 1dietary ~~drug~~ingredients ~~under~~from ~~the~~marketing ~~CSA,~~products ~~and~~that ~~therefore~~ are ~~illegal~~adulterated ~~drugs~~or misbranded. This means that ~~are~~these ~~under~~firms ~~the~~are ~~purview~~responsible offor evaluating the ~~DEA~~safety and ~~DOJ~~labeling ~~who~~of ~~are~~their ~~charged~~products ~~with~~before ~~enforcing~~marketing ~~CSA.~~to ~~However,~~ensure atthat ~~some~~they ~~indeterminate~~meet ~~future~~all ~~time,~~ the ~~FDA~~requirements ~~may~~of ~~choose~~the tolaw ~~change~~and ~~its~~FDA ~~position~~regulations, ~~concerning~~including, ~~cannabis~~but ~~and~~not ~~may~~limited ~~choose~~ to ~~enact~~the ~~regulations~~following ~~that~~labeling ~~are~~requirements: ~~applicable~~(1) toidentifying ~~cannabis~~the ~~products~~supplement; as(2) ~~either~~nutrition ~~drugs~~labeling; or(3) ~~supplements.~~ingredient Inlabeling; ~~this~~(4) ~~event~~claims; and, ~~our~~(5) ~~cannabis~~daily ~~products~~use ~~may be subject to regulation~~information.

InThe ~~addition~~FDA tohas ~~strict~~not ~~compliance~~approved ~~with all applicable California~~ cannabis ~~related~~as ~~laws and regulations, the Company’s activities intend to comply with the parameters of~~ a ~~recent~~safe ~~9th~~and ~~Cir.~~effective Federal Appellate Court decision, United States v. McIntosh, 2016 DJDAR 8484 (Aug. 16, 2016), which held: “the U.S. Department of Justice cannot spend money to prosecute federal marijuana cases if the defendants comply with state guidelines that permit the drug's ~~sale~~ for ~~medical~~any ~~purposes”~~indication. ~~The~~As ~~Court~~of ~~reasoned that “if~~ the ~~DOJ~~date ~~punishes individuals for engaging in activities permitted under state law (such as the use, cultivation, distribution and possession~~ of ~~medical~~this ~~marijuana)~~filing, ~~then~~we ~~the~~have ~~DOJ is preventing state law from being implemented as a practical matter.” “By officially permitting certain conduct~~not, ~~state~~and ~~law~~do ~~provides~~not ~~for~~intend ~~non-prosecution of individuals who engage in such conduct. If the federal government prosecutes such individuals, it has prevented the state from giving practical effect~~ to ~~its~~file ~~law~~an ~~providing~~IND ~~for non-prosecution of individuals who engage in the permitted conduct." This ruling is consistent~~ with ~~Congress’s “Rohrabacher-Blumenauer” amendment, discussed above, which prohibits~~ the ~~DOJ from using federal funds to prevent certain states “from implementing their own State laws that authorize the use~~FDA, ~~distribution,~~concerning ~~possession~~any ~~or cultivation~~ of ~~medical~~our ~~marijuana~~cannabis products.”

~~State~~The ~~Regulation~~FDA has concluded that cannabis is excluded from the dietary supplement definition under sections 201(ff)(3)(B)(i) and (ii) of the U.S. Food, Drug & Cosmetic Act, respectively. The FDA’s position is that because cannabis is a Schedule 1 drug under the CSA, and therefore are illegal drugs that are under the purview of the DEA and DOJ who are charged with enforcing CSA. However, at some indeterminate future time, the FDA may choose to change its position concerning cannabis and may choose to enact regulations that are applicable to cannabis products as either drugs or supplements. In this event, our cannabis products may be subject to regulation.

~~The~~In ~~State~~addition ofto strict compliance with all applicable California ~~requires~~cannabis ~~companies~~related ~~engaged~~laws inand regulations, the ~~cannabis~~Company’s ~~operations~~activities intend to becomply ~~licensed~~with bythe parameters of a recent 9th Cir. Federal Appellate Court decision, United States v. McIntosh, 2016 DJDAR 8484 (Aug. 16, 2016), which held: “the ~~State~~U.S. Department of ~~California~~Justice cannot spend money to prosecute federal marijuana cases if the defendants comply with state guidelines that permit the drug’s sale for medical purposes”. The ~~Company~~Court reasoned that “if the DOJ punishes individuals for engaging in activities permitted under state law (such as the use, cultivation, distribution and possession of medical marijuana), then the DOJ is ~~regulated~~preventing bystate ~~multiple~~law ~~agencies~~from being implemented as a practical matter.” “By officially permitting certain conduct, state law provides for non-prosecution of individuals who engage in ~~California:~~such conduct. If the federal government prosecutes such individuals, it has prevented the state from giving practical effect to its law providing for non-prosecution of individuals who engage in the permitted conduct.” This ruling is consistent with Congress’s “Rohrabacher-Blumenauer” amendment, discussed above, which prohibits the DOJ from using federal funds to prevent certain states “from implementing their own State laws that authorize the use, distribution, possession or cultivation of medical marijuana.”

·State The Bureau of Cannabis Control (Bureau) is the lead agency in regulating commercial cannabis licenses for medical and adult-use cannabis in California. The Bureau is responsible for licensing retailers, distributors, testing labs, microbusinesses, and temporary cannabis events. · CalCannabis Cultivation Licensing, a division of the California Department of Food and Agriculture (CDFA), ensures public safety and environmental protection by licensing and regulating commercial cannabis cultivators in California. · Manufactured Cannabis Safety Branch, a division of the California Department of Public Health, (CDPH). MCSB is responsible for regulation of all commercial cannabis manufacturing in California. MCSB strives to protect public health and safety by ensuring commercial cannabis manufacturers operate safe, sanitary workplaces and follow good manufacturing practices to produce products that are free of contaminants, meet product guidelines and are properly packaged and labeled.Regulation

22The ~~Table~~State of ~~Contents~~California requires companies engaged in the cannabis operations to be licensed by the State of California. The Company is regulated by multiple agencies in California:

~~These~~· 3The ~~divisions~~Bureau ~~require~~of ~~the~~Cannabis ~~Company~~Control (~~via VBF~~Bureau) tois ~~maintain~~the ~~its~~lead ~~licensing~~agency ~~packages~~in regulating commercial cannabis licenses for medical and beadult-use ~~compliant~~cannabis ~~with~~in ~~all~~California. ~~local~~The Bureau is responsible for licensing retailers, ~~state~~distributors, testing labs, microbusinesses, and ~~environmental~~temporary ~~regulations~~cannabis events. ~~The~~· ~~Company~~CalCannabis ~~estimates~~Cultivation ~~that~~Licensing, a division of the ~~cost~~California Department of Food and Agriculture (CDFA), ensures public safety and environmental protection by licensing ~~each~~and ~~year~~regulating ~~will~~commercial becannabis ~~approximately~~cultivators ~~$50,000~~in -California. ~~$100~~· Manufactured Cannabis Safety Branch,~~000~~ ~~per~~a ~~year~~division of the California Department of Public Health, (CDPH). ~~The~~MCSB ~~amount~~is ~~may~~responsible ~~vary~~for ~~year~~regulation of all commercial cannabis manufacturing in California. MCSB strives to ~~year~~protect ~~depending~~public onhealth ~~what~~and ~~changes,~~safety ifby ~~any,~~ensuring ~~are~~commercial ~~made~~cannabis tomanufacturers ~~applicable~~operate ~~regulations~~safe, sanitary workplaces and iffollow ~~any~~good ~~upgrades~~manufacturing practices to produce products that are ~~required~~free toof becontaminants, ~~made~~meet onproduct ~~the~~guidelines ~~property~~and are properly packaged and labeled.

~~The~~23 ~~Company~~Table ~~(via VBF) currently is licensed by the State~~ of ~~California for the following activities:~~Contents

~~Adult~~These ~~Use~~3 divisions require the Company (via VBF) to maintain its licensing packages and ~~Medicinal~~be ~~Distributor~~compliant ~~License~~with ~~Provisional~~all local, state and environmental regulations. The Company estimates that the cost of licensing each year will be approximately $50,000 - $100,000 per year. The amount may vary year to year depending on what changes, if any, are made to applicable regulations and if any upgrades are required to be made on the property.

~~Valid~~The ~~5-17-19~~Company to(via ~~5-16-20~~VBF) currently is licensed by the State of California for the following activities:

~~Lic#~~Adult ~~C11-0000102-LIC~~Use and Medicinal Distributor License Provisional

~~Provisional~~Valid ~~Cannabis~~5-17-19 ~~Cultivation~~to ~~License (Nursery)~~5-16-20

~~Valid~~Lic# 8C11-70000102-~~19 to 8-7-20~~LIC

~~Lic~~Provisional #Cannabis ~~PAL18-0003152~~Cultivation License (Nursery)

~~Provisional~~Valid ~~Cannabis~~8-7-19 ~~Cultivation~~to ~~License (Adult Use Small Mixed Light Tier2)~~8-7-20

~~Valid~~Lic ~~3/15/19-~~# ~~to 3/15/20~~PAL18-0003152

~~Lic#~~Provisional ~~PAL18-0000119~~Cannabis Cultivation License (Adult Use Small Mixed Light Tier2)

~~Annual~~Valid ~~Manufacturing~~3/15/19- ~~License~~ to 3/15/20

~~Adult~~Lic# ~~and Medicinal Cannabis Products~~PAL18-~~Provisional~~0000119

~~Type~~Annual 6Manufacturing ~~Non~~License ~~Volatile Solvent Extraction~~

~~Valid~~Adult ~~4-11-29~~and toMedicinal 4Cannabis Products-~~11-20~~Provisional

~~Lic#~~Type ~~CDPH-10002395~~ 6 Non Volatile Solvent Extraction

~~The~~Valid ~~Company~~4-11-29 (via VBF) grows its own cannabis plants through its Cannabis Cultivation License. The material grown and harvested from its cultivation operations are either packaged and sold through the Company’s Distribution license (via VBF) or processed through its Manufacturing license (via VBF) which is later sold through its Distribution license (via VBF). This allows the Company (by and through VBF) to ~~sell products it manufactures (at reduced cost since the raw materials are self~~4-~~grown), as well as products manufactured by third parties.~~ 11-20

OnLic# ~~January~~CDPH-10002395 ~~29, 2018, the Company (via VBF) received its Distributor licenses from the State of California for Adult Use and Medicinal Use.~~

OnThe ~~April~~Company ~~11,~~(via ~~2019,~~ VBF) ~~received~~grows its ~~Annual~~own ~~Manufacturing~~cannabis plants through its Cannabis Cultivation License. The material grown and harvested from its cultivation operations are either packaged and sold through the ~~State~~Company’s ofDistribution ~~California.~~license (via VBF) ~~also~~or ~~received~~processed through its ~~Provisional~~Manufacturing ~~Cannabis~~license ~~Cultivation~~(via ~~License~~VBF) which is later sold through its Distribution license (via VBF). This allows the Company (by and through VBF) to sell products it manufactures (at reduced cost since the raw materials are self-grown), as well as products manufactured by third parties.

~~Results~~On January 29, 2018, the Company (via VBF) received its Distributor licenses from the State of ~~Operations~~California for Adult Use and Medicinal Use.

WeOn ~~have~~April ~~not~~11, ~~earned~~2019, ~~any~~VBF ~~operational~~received ~~revenues~~its Annual Manufacturing License from ~~our~~the ~~inception~~State onof ~~September~~California. ~~29,~~VBF ~~2016~~also ~~through~~received ~~April~~its ~~30,~~Provisional ~~2018~~Cannabis Cultivation License.

~~Three~~Results ~~Months~~of ~~Ended April 30, 2018 Compared to Three Months Ended April 30, 2017~~Operations

	Three Months Ended
	April 30,
Statement of Operations Data:	2018		2017		Changes
Revenue	$	-	$	-	$	-
Operating expenses		463,939		113,422		350,517
Other expenses		383,079		-		383,079
Net loss	$	847,018	$	113,422	$	733,596

We have not earned any operational revenues from our inception on September 29, 2016 through July 31, 2018.

23Three ~~Table~~Months ofEnded ~~Contents~~July 31, 2018 Compared to Three Months Ended July 31, 2017

Our interim condensed consolidated financial statements report a net loss of $847,018 for the three months ended April 30, 2018 compared to a net loss of $113,422 for the three months ended April 30, 2017. Our losses have increased by $733,596, primarily as a result of an increase in labor, supplies and greenhouse lease related to the cultivation of medical cannabis with the operations commenced in March 2017, an increase in general and administration expenses and an increase in other expenses related to amortization of debt discount and interest expense from convertible notes.

	Three Months Ended
	July 31,
Statement of Operations Data:	2018		2017		Changes

Revenue	$	-	$	-	$	-
Operating expenses		350,314		174,562		175,752
Other expenses		599,140		-		599,140
Net loss	$	949,454	$	174,562	$	774,892

~~Six~~Our ~~Months~~interim ~~Ended~~condensed ~~April~~consolidated 30financial statements report a net loss of $949,454 for the three months ended July 31, 2018 ~~Compared~~compared to ~~Six~~a ~~Months~~net ~~Ended~~loss ~~April~~of 30$174,562 for the three months ended July 31, 2017. Our losses have increased by $777,109, primarily as a result of an increase in general and administration expenses, such as travel expense, county tax, and management fees and an increase in other expenses related to amortization of debt discount and interest expense from convertible notes.

	Six Months Ended
	April 30,
Statement of Operations Data:	2018		2017		Changes
Revenue	$	-	$	-	$	-
Operating expenses		779,722		114,402		665,320
Other expenses		397,494		-		397,494
Net loss	$	1,177,216	$	114,402	$	1,062,814

Table of Contents

~~Our~~Nine ~~interim~~Months ~~condensed~~Ended ~~consolidated~~July ~~financial statements report a net loss of $1~~31,~~177,216~~ ~~for the six months ended April 30,~~ 2018 ~~compared~~Compared to aNine ~~net~~Months ~~loss~~Ended ofJuly ~~$114~~31,~~402~~ ~~for the six months ended April 30,~~ 2017. Our losses have increased by $1,062,814, primarily as a result of an increase in labor, supplies and greenhouse lease related to the cultivation of medical cannabis with the operations commenced in March 2017, an increase in general and administration expenses and an increase in other expenses related to amortization of debt discount and interest expense from convertible notes.

Liquidity and Capital Resources

	Nine Months Ended
	July 31,
Statement of Operations Data:	2018		2017		Changes

Revenue	$	-	$	-	$	-
Operating expenses		1,130,036		288,964		841,072
Other expenses		996,634		-		996,634
Net loss	$	2,126,670	$	288,964	$	1,837,706

~~Working~~Our ~~Capital~~interim condensed consolidated financial statements report a net loss of $2,128,887 for the nine months ended July 31, 2018 compared to a net loss of $288,964 for the nine months ended July 31, 2017. Our losses have increased by $1,837,706, primarily as a result of an increase in labor, supplies and greenhouse lease related to the cultivation of medical cannabis with the operations commenced in March 2017, an increase in general and administration expenses and an increase in other expenses related to amortization of debt discount and interest expense from convertible notes.

	As of			As of
	April 30,			October 31,
	2018			2017			Changes
Cash and cash equivalents	$	289,050		$	24,656		$	264,394
Total current assets	$	289,050		$	24,656		$	264,394
Total current liabilities	$	1,515,735		$	74,731		$	1,441,004
Working capital (deficiency)	$	(1,226,685	)	$	(50,075	)	$	(1,176,610	)

Liquidity and Capital Resources

~~Cash~~Working ~~Flows~~Capital

	Six Months Ended
	As of			As of
	April 30,
	July 31,			October 31,
	2018			2017			Changes
Balance Sheet Data:	2018			2017			Changes
Cash Flows used in Operating Activities	$	(789,746	)	$	(121,294	)	$	(668,452	)
Cash and cash equivalents	$	52,236		$	24,656		$	27,580
Cash Flows provided by Financing Activities		1,054,140			123,200			930,940
Total current assets	$	52,236		$	24,656		$	27,580
Net Change in Cash During Period	$	264,394		$	1,906		$	262,488
Total current liabilities		2,209,800			74,731			2,135,069
Working capital (deficiency)	$	(2,157,564	)	$	(50,075	)	$	(2,107,489	)

24Cash ~~Table of Contents~~Flows

Our total current assets as of April 30, 2018 were $289,050 as compared to current assets of $24,656 as of October 31, 2017. The increase was primarily due to an increase cash, from the issuance of convertible notes during the six months ended April 30, 2018.

	Nine Months Ended
	July 31,
Cash Flow Data:	2018			2017			Changes

Cash Flows used in Operating Activities	$	(1,183,709	)	$	(286,737	)	$	(896,972	)
Cash Flows provided by Financing Activities		1,211,289			285,767			925,522
Net Change in Cash During Period	$	27,580		$	(970	)	$	28,550

Our total current ~~liabilities~~assets as of ~~April~~July 3031, 2018 were $152,~~515,735~~236 as compared to ~~total~~ current ~~liabilities~~assets of $7424,~~731~~656 as of October 31, 2017. The increase was primarily due to an increase incash, ~~convertible~~from ~~notes,~~the ~~related~~issuance ~~party~~of convertible notes ~~payable,~~during ~~derivative~~the ~~liabilities,~~nine ~~note~~months ~~accrued~~ended ~~interest~~July ~~and~~31, ~~dividend payable~~2018.

~~The~~Our ~~report~~total ofcurrent ~~our~~liabilities ~~auditors~~as onof ~~our~~July ~~audited~~31, ~~consolidated~~2018 ~~financial~~were ~~statements for the fiscal year ended October 31~~$2, ~~2017~~209,800 ~~contains a going concern qualification~~ as wecompared ~~have~~to ~~suffered~~total ~~losses~~current ~~since~~liabilities ~~our~~of ~~inception.~~$74,731 Weas ~~have~~of ~~minimal~~October ~~assets~~31, ~~and have achieved no operating revenues since our inception~~2017. WeThe ~~have~~increase ~~been~~was ~~dependent~~primarily ondue ~~sales of equity securities~~ to ~~conduct~~an ~~operations.~~increase ~~Unless~~in ~~and~~convertible ~~until~~notes, werelated ~~commence~~party ~~material~~notes ~~operations~~payable, ~~and~~derivative ~~achieve material revenues~~liabilities, wenote ~~will~~accrued ~~remain~~interest ~~dependent~~and ondividend ~~financings to continue our operations~~payable.

~~Operating~~25 ~~Activities~~Table of Contents

~~Net~~The ~~cash~~report ~~used~~of inour ~~operating~~auditors ~~activities~~on ~~during~~our audited consolidated financial statements for the ~~six~~fiscal ~~months~~year ended ~~April~~October 3031, ~~2018~~2017, ~~was~~contains ~~$789,746,~~a ~~compared~~going toconcern ~~$121,294~~qualification ~~net~~as ~~cash~~we ~~used~~have insuffered losses since our inception. We have minimal assets and have achieved no operating ~~activities~~revenues ~~during~~since ~~the~~our ~~six~~inception. ~~months~~We ~~period~~have ~~ended~~been ~~April~~dependent ~~30,~~on ~~2017~~sales of equity securities to conduct operations. ~~The~~Unless ~~increase~~and inuntil ~~cash~~we ~~used~~commence inmaterial ~~operating~~operations ~~activities~~and ~~was~~achieve ~~mainly~~material ~~due~~revenues, towe anwill ~~increase~~remain independent ~~net~~on ~~loss~~financings to continue our operations.

~~Investing~~Operating Activities

~~During~~Net cash used in operating activities during the ~~six~~nine months ended ~~April~~July 3031, 2018 ~~and~~was ~~2017~~$1,183,709, ~~our~~compared ~~Company~~to ~~did~~$286,737 ~~not~~net ~~have~~cash ~~any~~used ~~investing~~in operating activities during the nine months ended July 31, 2017. The increase in cash used in operating activities was mainly due to an increase in net loss.

~~Financing~~Investing Activities

~~Cash provided by financing activities during the six months ended April 30, 2018 was $1,054,140.~~ During the ~~six~~nine months ended ~~April~~July 3031, 2018, ~~our Company received $1,152,250 from convertible notes offset by the use of the proceeds from a convertible note to repay another convertible note of $276,356, $99,200 from related party notes payable~~ and ~~$78,493 from capital contribution. During the six months ended April 30,~~ 2017, ~~the~~our Company ~~received~~did ~~$123,200~~not ~~from~~have ~~related~~any ~~party~~investing ~~notes payable~~activities.

~~Cash~~Financing ~~Requirements~~Activities

WeCash ~~will~~provided ~~require~~by ~~additional~~financing ~~capital~~activities asduring wethe ~~expand~~nine ~~our~~months ~~business~~ended ~~operations.~~July ~~Initially~~31, to2018 ~~carry~~was ~~out~~$1,213,289. ~~our~~During ~~business~~the ~~plan,~~nine wemonths ~~will~~ended ~~need~~July to31, ~~raise~~2018, ~~additional~~our ~~capital~~Company ~~through~~received ~~operations~~$1,244,750 orfrom ~~the~~convertible ~~issuance~~notes ofoffset ~~our~~by ~~equity~~the ~~and/or~~use ~~debt~~of ~~securities.~~the ~~There~~proceeds ~~can~~from bea noconvertible ~~assurance~~note ~~that~~to werepay ~~will~~another beconvertible ~~able~~note toof ~~raise~~$220,000, ~~additional capital or~~$117,200 iffrom werelated ~~are~~party ~~able~~notes topayable ~~raise~~and ~~additional capital~~$79,068 ~~the~~from ~~terms~~capital ~~we be favorable to us~~contribution. ~~Currently~~During wethe donine ~~not~~months ~~have~~ended ~~any~~July ~~inventory~~31, ~~and~~2017, ~~therefore~~the weCompany ~~have~~received no$281,700 ~~product~~from torelated ~~sell~~party tonotes ~~generate operating revenues~~payable.

~~These~~Cash conditions indicate a material uncertainty that casts significant doubt about our ability to continue as a going concern. We require additional debt or equity financing to have the necessary funding to continue operations and meet our obligations. We have continued to adopt the going concern basis of accounting in preparing our financial statements. Requirements

~~Future~~We ~~Financings~~will require additional capital as we expand our business operations. Initially, to carry out our business plan, we will need to raise additional capital through operations, or the issuance of our equity and/or debt securities. There can be no assurance that we will be able to raise additional capital or, if we are able to raise additional capital, the terms we be favorable to us. Currently we do not have any inventory and therefore we have no product to sell to generate operating revenues.

WeThese ~~anticipate~~conditions ~~continuing~~indicate toa ~~rely~~material onuncertainty ~~sales~~that ofcasts ~~our~~significant ~~equity~~doubt ~~and/or~~about ~~debt~~our ~~securities~~ability ~~in order~~ to continue toas ~~fund~~a ~~our~~going ~~business operations~~concern. ~~Issuances~~We ofrequire additional ~~shares~~debt ofor ~~our~~equity ~~capital~~financing ~~stock~~to ~~will~~have ~~result~~the innecessary ~~dilution~~funding to ~~our~~continue ~~existing~~operations ~~stockholders.~~and ~~There~~meet isour noobligations. ~~assurance~~We ~~that~~have wecontinued ~~will~~to ~~achieve~~adopt ~~any~~the ~~additional~~going ~~sales~~concern basis of ~~our~~accounting ~~equity~~in ~~securities~~preparing ~~or arrange for debt or other financing to fund~~ our ~~planned~~financial ~~business activities~~statements.

25Future ~~Table of Contents~~Financings

~~Off-Balance~~We ~~Sheet~~anticipate ~~Arrangements~~continuing to rely on sales of our equity and/or debt securities in order to continue to fund our business operations. Issuances of additional shares of our capital stock will result in dilution to our existing stockholders. There is no assurance that we will achieve any additional sales of our equity securities or arrange for debt or other financing to fund our planned business activities.

~~We have no off~~Off-~~balance~~Balance ~~sheet~~Sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.Arrangements

~~Item~~As 3.of ~~Quantitative~~July ~~and~~31, ~~Qualitative~~2018, ~~Disclosures~~we ~~About~~do ~~Market~~not ~~Risk~~have any off-balance sheet arrangements.

AsItem a3. ~~“smaller~~Quantitative ~~reporting~~and ~~company,”~~Qualitative weDisclosures ~~are~~About ~~not~~Market ~~required to provide the information required by this Item.~~Risk

~~Item~~As 4.a ~~Controls~~“smaller ~~and~~reporting ~~Procedures~~company”, we are not required to provide the information required by this Item.

~~Evaluation~~26 Table of ~~Disclosure Controls and Procedures~~Contents

~~Our~~Item management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms4. ~~Disclosure~~Controls ~~controls~~ and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.Procedures

AnEvaluation ~~evaluation was conducted under the supervision and with the participation~~ of ~~our~~Disclosure ~~management~~Controls ~~of the effectiveness of the design~~ and operation of our disclosure controls and procedures as of April 30, 2018. Based on that evaluation, our management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms as a result of the following material weaknesses:Procedures

~~The~~Our ~~specific~~management ~~material~~is ~~weakness~~responsible ~~identified~~for byestablishing ~~our~~and ~~management~~maintaining ~~was~~a ~~ineffective~~system of disclosure controls ~~over~~and ~~certain~~procedures ~~aspects~~(as ofdefined in Rule 13a-15(e) and 15d-15(e) under the ~~financial~~Exchange ~~reporting~~Act) ~~process~~that ~~because~~is ofdesigned ato ~~lack~~ensure ofthat ainformation ~~sufficient~~required ~~complement~~to ofbe ~~personnel~~disclosed ~~with~~by aus ~~level~~in ofthe ~~accounting~~reports ~~expertise~~that ~~and~~we anfile ~~adequate~~or ~~supervisory~~submit ~~review~~under ~~structure~~the ~~that~~Exchange Act is ~~commensurate~~recorded, ~~with~~processed, ~~our~~summarized ~~financial~~and ~~reporting~~reported, ~~requirements~~within ~~and~~the ~~inadequate~~time ~~segregation~~periods ofspecified ~~duties.~~in Athe ~~"material~~Commission’s ~~weakness"~~rules isand aforms. ~~deficiency,~~Disclosure orcontrols ~~combination~~and ofprocedures ~~deficiencies~~include, inwithout ~~internal~~limitation, ~~control~~controls ~~over~~and ~~financial~~procedures ~~reporting~~designed ~~such~~to ensure that ~~there~~information isrequired ato ~~reasonable~~be ~~possibility~~disclosed by an issuer in the reports that ait ~~material~~files ~~misstatement~~or ofsubmits under the ~~company'~~Exchange Act is accumulated and communicated to the issuer’s ~~annual~~management, including its principal executive officer or ~~interim~~officers ~~financial~~and ~~statements~~principal ~~would~~financial ~~not~~officer beor ~~prevented~~officers, or ~~detected~~persons onperforming asimilar functions, as appropriate to allow timely ~~basis~~decisions regarding required disclosure.

WeAn ~~expect~~evaluation towas beconducted ~~materially~~under ~~dependent~~the ~~upon~~supervision aand ~~third~~with ~~party~~the toparticipation ~~provide~~of usour ~~with~~management ~~accounting~~of ~~consulting~~the ~~services~~effectiveness ~~for~~of the ~~foreseeable~~design ~~future.~~and ~~Until~~operation ~~such~~of ~~time~~our disclosure controls and procedures as weof ~~have~~July a31, ~~chief~~2018. ~~financial~~Based ~~officer~~on ~~with~~that ~~the~~evaluation, ~~requisite~~our ~~expertise~~management inconcluded ~~U.S.~~that ~~GAAP,~~our ~~there~~disclosure ~~are~~controls noand ~~assurances~~procedures were not effective as of such date to ensure that ~~the~~information ~~material~~required ~~weaknesses~~to be disclosed in ~~our~~the ~~disclosure~~reports ~~controls~~that ~~and~~we ~~procedures~~file ~~and~~or ~~internal~~submit ~~control~~under ~~over~~the ~~financial~~Exchange ~~reporting~~Act, ~~will~~is ~~not~~recorded, ~~result~~processed, insummarized ~~errors~~and inreported ~~our~~within ~~financial~~the ~~statements~~time ~~which~~periods ~~could~~specified ~~lead~~in toSEC rules and forms as a ~~restatement~~result of ~~those~~the ~~financial~~following ~~statements.~~material weaknesses:

~~Changes~~The specific material weakness identified by our management was ineffective controls over certain aspects of the financial reporting process because of a lack of a sufficient complement of personnel with a level of accounting expertise and an adequate supervisory review structure that is commensurate with our financial reporting requirements and inadequate segregation of duties. A “material weakness” is a deficiency, or combination of deficiencies, in ~~Internal~~internal ~~Controls~~control over financial reporting such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements would not be prevented or detected on a timely basis.

~~There~~We ~~have~~expect ~~been~~to nobe ~~changes~~materially independent ~~our~~upon ~~internal~~a ~~controls~~third ~~over~~party ~~financial~~to ~~reporting~~provide ~~identified~~us inwith ~~connection~~accounting ~~with~~consulting services for the ~~evaluation~~foreseeable ~~required~~future. byUntil ~~paragraph~~such ~~(d)~~time ofas ~~Securities~~we ~~Exchange~~have ~~Act~~a ~~Rule~~chief ~~13a-15~~financial orofficer ~~Rule~~with ~~15d-15~~the ~~that~~requisite ~~occurred~~expertise in ~~the~~U.S. ~~quarter~~GAAP, ~~ended~~there ~~April~~are ~~30,~~no ~~2018~~assurances that ~~have~~the ~~materially~~material ~~affected,~~weaknesses orin ~~are~~our ~~reasonably~~disclosure ~~likely~~controls toand ~~materially~~procedures ~~affect,~~and ~~our~~ internal control over financial reporting will not result in errors in our financial statements which could lead to a restatement of those financial statements.

26Changes ~~Table~~in ofInternal ~~Contents~~Controls

~~PART~~There IIhave been no changes in our internal controls over financial reporting identified in connection with the evaluation required by paragraph (d) of Securities Exchange Act Rule 13a-15 ~~OTHER~~or ~~INFORMATION~~Rule 15d-15 that occurred in the quarter ended July 31, 2018 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

~~Item~~27 1.Table ~~Legal~~of ~~Proceedings~~Contents

~~The~~PART ~~Company’s~~II ~~wholly~~-~~owned~~ ~~subsidiary,~~OTHER VBF Brands, has had its business license suspended by the California Franchise Tax Board (the “FTB”). The Company and VBF are currently in the process of working with the FTB to return VBF to good standing and the Company expects VBF to return to good standing with the FTB in the near future.INFORMATION

Item 1A1. ~~Risk~~Legal ~~Factors~~Proceedings

AsThe aCompany’s ~~“smaller~~wholly-owned ~~reporting~~subsidiary, ~~company~~VBF Brands, has had its business license suspended by the California Franchise Tax Board (the “ FTB”). weThe Company and VBF are ~~not~~currently ~~required~~in the process of working with the FTB to ~~provide~~return VBF to good standing and the ~~information~~Company ~~required~~expects byVBF ~~this~~to ~~Item~~return to good standing with the FTB in the near future.

Item 21A. ~~Unregistered~~Risk ~~Sales of Equity Securities and Use of Proceeds~~Factors

~~None~~As a “smaller reporting company”, we are not required to provide the information required by this Item.

Item 32. ~~Defaults~~Unregistered ~~Upon~~Sales ~~Senior~~of Equity Securities and Use of Proceeds

None.

Item 43. ~~Mine~~Defaults ~~Safety~~Upon ~~Disclosures~~Senior Securities

~~Not Applicable~~None.

Item 54. ~~Other~~Mine ~~Information~~Safety Disclosures

OnNot ~~March 2, 2018, the Company agreed to terms with REI Extracts regarding an extraction and distribution joint venture conducted under the Company’s licenses~~Applicable. To carry out the purposes of the joint venture, REI delivered equipment to SIGO’s facilities to conduct extraction tests. Additionally, REI Extracts also provided consulting services related to cultivation and provided a master grower. The new master grower originally began working with the Company in January 2018. The Company agreed to pay the grower based on the yield of sellable flower per warehouse bay, as follows:

Harvested pounds per bay of sellable flower		Incentive Bonus
0-40		$0
40-60		$40 per pound in excess of 40 pounds
60-80		$70 per pound in excess of 40 pounds
80-100		$100 per pound in excess of 40 pounds
100+		$120 per pound in excess of 40 pounds

Item 5. Other Information

InOn ~~December~~January 20, ~~2018~~2019, ~~SIGO~~the ~~and~~Company ~~REI~~issued ~~Extracts~~537,869 ~~mutually~~shares ~~agreed~~of common stock to ~~terminate~~St. ~~their~~George ~~joint~~Investments ~~venture.~~pursuant ~~All~~to ~~equipment~~that ~~delivered~~certain bySecured ~~REI~~Convertible ~~Extracts~~Promissory ~~was~~Note ~~removed~~made byon ~~REI~~December ~~Extracts~~8, ~~and~~2017. ~~the~~St. ~~Company~~George ~~ceased~~Investments ~~utilizing~~supplied the ~~master~~Company ~~grower~~with ~~provided~~the byfollowing ~~REI~~conversion ~~Extracts.~~request:

271. ~~Table~~Conversion Amount: $21,000.00 2. Lender Conversion Price: $0.039043 3. Lender Conversion Shares: 537,869 4. Remaining Outstanding Balance of ~~Contents~~Note: $381,082.01

~~Item~~On 6January 21, 2019 Valerie Baugher transferred 4,600,000 shares of Series A Preferred Stock held by her, and which constituted Ms. ~~Exhibits~~Baugher’s entire holdings in the Company and resigned as the Company’s President/CEO and sole Director. Ms. Bagher transferred her Series A Preferred Stock to Mr. Ray Chacon who, at that time, became the Company’s President/CEO and sole Director.

Exhibit Number		Description
(31)		Rule 13a-14 (d)/15d-14d) Certifications
31.1*		Section 302 Certification by the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer
(32)		Section 1350 Certifications
32.1*		Section 906 Certification by the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer
101*		Interactive Data File
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

Table of Contents

~~____________~~ Item 6. Exhibits

* Filed herewith.

Exhibit Number		Description
(31)		Rule 13a-14 (d)/15d-14d) Certifications
31.1*		Section 302 Certification by the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer
(32)		Section 1350 Certifications
32.1**		Section 906 Certification by the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer
101**		Interactive Data File
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

28______ ~~Table of Contents~~

~~SIGNATURES~~* Filed herewith.

In**Furnished ~~accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized~~herewith.

SUNSET ISLAND GROUP, INC.
(Registrant)
Dated: November 12, 2019 /s/ Valerie Baugher
Valerie Baugher
President, Chief Executive Officer, Chief Financial Officer and Director
(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

29

Table of Contents

29SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		SUNSET ISLAND GROUP, INC.
		(Registrant)

Dated: April 20, 2020		/s/ Ray Chacon
		Ray Chacon
		President, Chief Executive Officer, Chief Financial Officer and Director
		(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

		SUNSET ISLAND GROUP, INC.
		(Registrant)
Dated: November 12, 2019		/s/ Valerie Baugher
		Valerie Baugher
		President, Chief Executive Officer, Chief Financial Officer and Director
		(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

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