UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

[X]	ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2018
For the fiscal year ended December 31, 2019
[ ]	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
For the transition period from _________ to ________

Commission File Number: 000-55609

Rocky Mountain High Brands, Inc.

(Exact name of registrant as specified in its charter)

Nevada			90-0895673
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
9101 LBJ Freeway, Suite 200, Dallas, TX 75243 (Address of principal executive offices) (Zip code)
9101 LBJ Freeway, Suite 420, Dallas, TX 75243 (Address of principal executive offices) (Zip code)
(800)-260-9062 (Registrant’s telephone number, including area code)
	Securities registered under Section 12(b) of the Act: Not Applicable
	None (Title of each class)	N/A (Name of Exchange on which registered)

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

Common Stock, $0.001 par value

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]

Indicate by checkmark 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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes [X] No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

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.

[ ] Large accelerated filer	[ ] Accelerated filer
[ ] Non-accelerated filer	[X] Smaller reporting company
[X] Emerging growth company

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 [ ] No [X]

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed ~~second~~ second fiscal quarter. Approximately $2310,~~047~~897,~~302~~999 as of June 30, ~~2018~~2019, using the closing price of $0.~~01135~~10 per share.

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date. 2284,~~083~~451,~~392,171~~184 of as of ~~April~~July 106, ~~2019~~ 2020.

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TABLE OF CONTENTS

	PART I
		Page
Item 1.	Business Overview	3
Item 1A.	Risk Factors	109
Item 2.	Properties	109
Item 3.	Legal Proceedings	1110
Item 4.	Mine Safety Disclosures	1311
PART II

Item 5.	Unregistered Sales of Equity Securities and Use of Proceeds Between November 17, 2018 and March 30, 2019	1311
Item 6	Selected Financial Data	1513
Item 7	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1513
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	2522
Item 8.	Financial Statements and Supplementary Data	2522
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	2623
Item 9A.	Controls and Procedures	2623
Item 9B	Other Information	2723
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	2724
Item 11.	Executive Compensation	3028
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	3330
Item 13.	Certain Relationships and Related Transactions, and Director	3431
Item 14.	Principal Accounting Fees and Services	3532
PART IV
Item 15.	Exhibits, Financial Statement Schedules	3633

EXPLANATORY NOTE

On March 30, 2020, Rocky Mountain High Brands, Inc. (the “Company”) filed a Current Report on Form 8-K, and is filing this Annual Report on Form 10-K, in reliance on the Order of the Securities and Exchange Commission dated March 4, 2020, as modified March 25, 2020, pursuant to Section 36 of the Securities Exchange Act of 1934 modifying exemptions from the reporting and proxy delivery requirements for public companies (Release No. 34-22465).

Dallas County, Texas, where the Company is headquartered, issued an order requiring all individuals anywhere in Dallas County to remain at home, with the sole exception of essential business and government services. As a result of this and other disruptions caused by the Covid-19 pandemic, the preparation of the Company’s Annual Report, including its financial statements, was delayed. Certain Company officers and management, as well as professional staff, were unable to conduct the work required to prepare and file the Company’s financial report for the year ended December 31, 2019 on a timely basis.

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PART I

When used in this Annual Report, unless otherwise indicated, the terms “the Company,” “RMHB,” “we,” “us,” and “our” refers to Rocky Mountain High Brands, Inc. and/or its subsidiaries. All references in this report to “$” or “dollars” are to United States dollars, unless specifically stated otherwise.

Forward-Looking Statements

This Annual Report contains forward-looking statements that reflect our current views about future events. We use the words “anticipate,” “assume,” “believe,” “estimate,” “expect,” “will,” “intend,” “may,” “plan,” “project,” “should,” “could,” “seek,” “designed,” “potential,” “forecast,” “target,” “objective,” “goal,” or the negatives of such terms or other similar expressions. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our 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.

Item 1. Business Overview

Rocky Mountain High Brands, Inc. is a Nevada corporation. RMHB currently operates through its parent company, ~~three~~four wholly-owned subsidiaries, one majority-owned subsidiary, and one minority-owned subsidiary, which the Company controls. All subsidiaries are consolidated for financial reporting purposes:

~~wholly-owned~~· ~~subsidiaries and~~Rocky ~~one~~Mountain ~~minority-owned~~High ~~subsidiary~~Brands, ~~which the Company controls~~Inc., ~~All~~an ~~subsidiaries~~active ~~are~~Nevada ~~consolidated~~corporation ~~for financial reporting purposes:~~(Parent)

•· Wellness For Life Colorado, Inc. (“WFLC”) (f/k/a Rocky Mountain ~~High~~Hemp ~~Brands~~Company and Wellness For Life, Inc.), an active ~~Nevada~~Colorado corporation (~~Parent~~Subsidiary)

•· ~~Wellness~~Rocky ~~For~~Mountain ~~Life Colorado~~Productions, Inc. (“~~WFLC~~RMPI”) ~~(f/k/a Rocky Mountain Hemp Company and Wellness For Life~~, ~~Inc.),~~ an active ~~Colorado~~Nevada corporation (Subsidiary)

•· Eagle Spirit Land & Water Company (“Eagle Spirit”), an active Oklahoma corporation (Subsidiary)

•· Rocky Mountain High Water Company, LLC (“WaterCo”), an active Delaware limited liability company (Subsidiary~~-consolidated beginning November 12, 2016~~)

•· FitWhey Brands Inc. (“FitWhey”), an active Nevada corporation (Subsidiary)

•· ~~Rocky~~Sweet ~~Mountain~~Rock, ~~High~~LLC ~~Clothing~~(“Sweet ~~Company~~Rock”), ~~Inc.,~~ an ~~inactive~~active ~~Texas~~Michigan ~~Corporation~~limited liability company (Subsidiary)

•· ~~Smarterita~~Rocky Mountain High Clothing Company, ~~LLC~~Inc., an inactive Texas ~~limited~~Corporation ~~liability company~~ (Subsidiary)

Smarterita, LLC, an inactive Texas limited liability company (Subsidiary)

RMHB is a consumer goods company that specializes in the developing, manufacturing, marketing, and distributing high-quality, health conscious, hemp oil and hemp extract-infused products that span various categories including beverage, food, fitness, skin care, and more. RMHB also markets a naturally high alkaline spring water as part of our brand portfolio. All products comply with federal regulations on hemp products and contain 0.0% tetrahydrocannabinol (“THC”), the psychoactive constituent of cannabis. Recently, through a newly created subsidiary of RMHB, Rocky Mountain Productions, Inc., the Company acquired a bottling and canning facility and is now also in the business of canning both its own beverages as well as canning beverages for other customers. Furthermore, as a result of equipment included in the acquisition of the facility, RMHB is also in the business of bottling hand sanitizer. Because of the demand resulting with the COVID-19 pandemic, RMHB anticipates continuing in the bottling of hand sanitizer for the foreseeable future.

In March 2018, the Company launched the HEMPd brand with gummies, water soluble drops, capsules, tinctures, lotions, and salves. The Company introduced four flavors of HEMPd CBD-infused waters in 12 oz. cans in November 2018 and sold those beverages in carbonated and non-carbonated offerings in 2019.

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~~RMHB~~In isJuly a2018, ~~lifestyle~~the ~~brand management~~Company ~~company~~acquired ~~that~~the ~~markets~~assets of ~~primarily~~BFIT ~~CBD~~Brands, LLC and ~~hemp-infused~~formed ~~products~~a tonew ~~health-conscious consumers. Our products span various categories including beverage~~subsidiary, ~~food,~~FitWhey ~~fitness,~~Brands ~~and skin care~~LLC. ~~RMHB~~FitWhey ~~also~~marketed ~~markets~~ a ~~naturally~~line-up ~~high~~of ~~alkaline~~five ~~spring~~ water ~~and a water~~-based protein ~~drink~~drinks that ~~with~~include caffeine and B vitamins. ~~All~~In ~~products~~August ~~comply~~2019 ~~with~~management ~~federal~~determined ~~regulations~~the onCompany ~~hemp~~would ~~products~~suspend ~~and~~the ~~contain~~production ~~0.0%~~of ~~tetrahydrocannabinol~~FitWhey ~~(THC),~~branded ~~the~~products ~~psychoactive~~until ~~constituent~~it ofdevelops ~~cannabis~~a related hemp or CBD-infused product.

InOn ~~March~~June ~~2018~~12, 2019 the Company ~~launched~~ ~~the~~organized ~~HEMPd~~Sweet Rock, ~~brand~~LLC ~~with~~(“Sweet ~~gummies~~Rock”), ~~water~~a ~~soluble~~51% ~~drops,~~owned ~~capsules~~company, ~~tinctures,~~with ~~lotions~~Sweet Ally, ~~and salves~~Inc. ~~The~~Sweet ~~Company~~Rock ~~introduced~~will ~~four flavors~~manufacture ofand market CBD-infused chocolates, ~~waters~~hard incandies, 12and ~~oz.~~baked ~~cans~~goods for distribution in ~~November~~the ~~2018~~United States.

InOn ~~July~~April ~~2018~~29, 2020 the Company formed Rocky ~~acquired~~Mountain ~~the~~Productions, ~~assets~~Inc. (“RMPI”), a wholly-owned Nevada corporation. On April 30, 2020, RMPI purchased certain assets of ~~BFIT~~Raw ~~Brands~~Pharma, LLC ~~and~~(“Raw ~~formed~~Pharma”) aincluding ~~new~~machinery, ~~subsidiary~~equipment, ~~FitWhey~~and ~~Brands LLC~~fixtures. ~~FitWhey~~The ~~markets~~facility ahas ~~line-up~~the ofcapability ~~five water-based~~to ~~protein~~can ~~drinks~~and ~~that~~bottle ~~include~~products, ~~caffeine~~including 12 oz. regular and Bsleek ~~vitamins~~cans, 16 oz. cans, shots, and bottles.

~~During~~RMHB ~~2017~~also bottles and ~~2018,~~distributes ~~the Company continued to market~~ its ~~lineup of~~ naturally ~~flavored hemp-infused functional beverages, as well as hemp-infused 2oz. Mango~~ ~~Energy~~high ~~Shots~~alkaline ~~and~~spring ~~Mixed~~water ~~Berry Energy Shots through the first half of 2018. The Company plans to introduce updated offerings of hemp seed extract-infused functional beverages in the second quarter of 2019~~ under the name ofEagle ~~Rocky~~Spirit ~~Mountain~~Spring Water.

Corporate History

Rocky Mountain High Brands Inc. October 23, 2014 to present – Articles of Amendment filed with the State of Nevada

f/k/a Totally Hemp Crazy Inc. July 17, 2014 to October 23, 2014 – Articles of Amendment filed with the State of Nevada

f/k/a Republic of Texas Brands Incorporated November 2011 to July 17, 2014 – Articles of Amendment filed with the State of Nevada

f/k/a Legends Food Corporation May 2011 to November 2011 – Articles of Amendment filed with the State of Nevada

f/k/a Precious Metals Exchange Corp. – Articles of Amendment filed with the State of Nevada on December 23, 2008

f/k/a Stealth Industries, Inc. – Articles of Amendment filed with the State of Minnesota on October 25, 1999 (name change). Articles of Incorporation filed with the State of Nevada on October 30, 2000 (Change of Domicile; Merger with Stealth Industries, Inc. (Minnesota)

f/k/a Assisted Living Corporation – Articles of Amendment filed with the State of Minnesota on November 3, 1993 (name change) f/k/a Electric Reel Corporation of America, Inc. -- Articles of Incorporation filed with the State of Minnesota on August 15, 1968

Acquisitions

~~Rocky~~FitWhey ~~Mountain~~Brands ~~High~~Inc. ~~Water Company~~(acquisition of the assets of BFIT Brands, LLC)

In July ~~2016~~2018, the Company purchased the assets ~~entered~~of ~~into~~BFIT Brands, LLC, an Arizona-based company. The acquired assets include the cash, accounts receivable, inventory, FitWhey trademark, recipes and formulas of BFIT’s FitWhey branded water-based protein drinks containing caffeine and a ~~business~~vitamin-B ~~alliance~~pack. ~~with~~The ~~Poafpybitty~~Company paid ~~Family~~$230,438 ~~LLC~~including common stock issued to ~~launch~~the ~~Eagle~~owners ~~Spirit~~of ~~Spring~~BFIT ~~Water~~of $75,000, forgiveness of a ~~line~~note receivable of ~~purified~~$80,000 ~~high-alkaline~~plus ~~spring~~accrued ~~water~~interest ~~sourced~~of ~~from~~$438, ~~Native~~and ~~American~~$75,000 ~~tribal~~to ~~land~~be inpaid ~~Oklahoma~~to the owners of BFIT over time based on 5% of net sales of FitWhey products. The acquisition included $98,297 of assets including cash, accounts receivable, inventory, and prepaid production costs and $132,141 of intangible assets, including the FitWhey software, trademark, formulas, and goodwill.

In August 2019 management determined the Company would suspend the production of water-based protein and caffeine-infused products until it develops a related hemp or CBD-infused product. As a result, the Company fully impaired the intangible assets related to its purchase of FitWhey. This resulted in an impairment charge of $118,066 for the year ended December 31, 2019.

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~~The~~Raw ~~agreement~~Pharma, ~~calls for~~LLC ~~the~~(acquisition ~~Company to pay a royalty on each gallon~~ of ~~water~~certain assets ~~collected at the spring. Production~~ of ~~filtered~~Raw ~~spring~~Pharma, ~~water filled bottles commenced in August 2016 and sales began in October 2016.~~LLC)

InOn ~~consideration~~April ~~for~~29, 2020 the ~~20-year~~ ~~water~~Company ~~and~~formed ~~surface~~Rocky Mountain ~~rights~~Productions, ~~and~~Inc. (“RMPI”), a ~~related 10~~wholly-~~year~~owned ~~renewal~~Nevada ~~option~~corporation. On April 30, ~~the~~2020, ~~Company~~RMPI ~~paid~~purchased ~~Poafpybitty~~certain ~~Family~~assets of Raw Pharma, LLC ~~cash~~(“Raw ~~payments of~~Pharma”) ~~$22~~including machinery,~~500~~ equipment, and ~~issued~~fixtures. aThe ~~warrant~~facility ~~for~~is ~~500~~located in Plano,~~000~~ ~~shares~~Texas and ofhas the ~~Company’s~~capability ~~common~~to ~~stock~~can ~~exercisable~~and atbottle $products, including 12 oz.03 ~~per~~regular ~~share~~and ~~over~~sleek acans, ~~three-year period~~16 ~~beginning~~oz. ~~July~~cans, 27shots, ~~2016~~and bottles.

The agreement grants the Company an exclusive right to develop land adjacent to the spring for commercial purposes as agreed to by both parties. Additionally, the Company has agreed to grow hemp for experimental or commercial purposes on the land within three years.

On November 12, 2016, the agreement with the Poafpybitty Family was amended to give the Company a controlling voting interest of 75% of WaterCo, while the Poafpybitty Family received a majority 51% of the equity interest. The amended agreement is being accounted for as a step-acquisition, with the resulting goodwill of $59,163 included in other assets. During the six months ended December 31, 2017, the Company obtained an outside valuation of the rights to use the land and obtain the water described in the agreement. As a result of that analysis and the continued operating losses by the Company’s spring water business, the Company determined that its investment, including the related goodwill, was fully impaired. The Company recorded an impairment expense of $59,163 as of November 12, 2017. As a result of the step-acquisition, beginning on November 12, 2016 the operations of WaterCo are consolidated in the financial statements of RMHB.

FitWhey Brands Inc. (acquisition of the assets of BFIT Brands, LLC)

In July 2018, the Company purchased the assets of BFIT Brands, LLC, an Arizona-based company. The acquired assets include the cash, accounts receivable, inventory, FitWhey trademark, recipes and formulas of BFIT’s FitWhey branded water-based protein drinks containing caffeine and a vitamin-B pack. The Company paid $230,438 including common stock issued to the owners of BFIT of $75,000, forgiveness of a note receivable of $80,000 plus accrued interest of $438, and $75,000 to be paid to the owners of BFIT over time based on 5% of net sales of FitWhey products. The acquisition includes $98,297 of assets including cash, accounts receivable, inventory, and prepaid production costs and $132,141 of intangible assets, including the FitWhey software, trademark, formulas, and goodwill. The Company is obtaining an outside valuation of these assets.

Trademarks Related to Our Business

• Rocky Mountain High

• HEMPd

• HEMPFIT

• Smarterita

• Totally Hemp Crazy

• Blue Leaf

• Rock the Road Trip

• Eagle Spirit

• Eagle Paa

• FitWhey

Strategic Update and Planned Product Offerings

The Company recently updated and began execution of its long-term strategic plan. Management’s goal is to become the cutting-edge leader in CBD and hemp-infused food, beverage, fitness, and other health-conscious product categories. This includes the use of CBD and hemp in products under the HEMPd and Rocky Mountain brand names. In late 2017, the Company executed its first private label manufacturing agreement and in 2019 executed a second private label agreement. Production on both private label agreements is scheduled to start in the second quarter of 2019.

The Company’s marketing will focus on the health benefits of hemp and CBD.

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Current Product Offerings

The Company’s Wellness For Life Colorado, Inc. subsidiary currently markets the following lineup of CBD-infused products under the HEMPd brand:

• CBD-Infused Waters – The Company’s initial production run of CBD-Infused waters consisted of 12 oz. cans each containing 5mg of CBD. The Company has since raised the CBD content to 20mg per can in its ~~March~~subsequent ~~2019~~ production ~~run~~runs. The Company currently markets four flavors of carbonated and non-carbonated HEMPd CBD-Infused waters. • Gummies – Each bottle contains 30 gummies containing 25mg of full plant hemp extract in assorted flavors. Gummies are made to be chewed and ingested for absorption for hemp absorption. • Water Soluble Concentrate– Each bottle contains 1,500mg of full plant hemp extract. Consumers place approximately 8 drops of this water-soluble concentrate in 12-16 oz. of water for a daily dose of hemp. • Tinctures – Each bottle contains 300mg of full plant hemp extract. Consumers place these drops under their tongue. • Triple Relief Salve – Each jar contains 250mg of full plant hemp extract. The salve is used directly on skin for pain relief in muscles, bones and joints. • Serenity Hemp Lotion – Each bottle contains 250mg of full plant hemp extract. Lotion is meant to be applied to any part of the skin for absorption into your body.

~~• Gummies – Each bottle contains 30 gummies containing 25mg of full plant hemp extract in assorted flavors. Gummies are made to be chewed and ingested for absorption for hemp absorption.~~5

• Water Soluble Concentrate – Each bottle contains 1,500mg of full plant hemp extract. Consumers place approximately 8 drops of this water-soluble concentrate in 12-16 oz. of water for a daily dose of hemp.

• Tinctures – Each bottle contains 300mg of full plant hemp extract. Consumers place these drops under their tongue. Flavors include tangerine, lemon, and spearmint.

• Capsules – Each bottle contains 30 capsules containing 25mg of full plant hemp extract. The capsules are swallowed for ingestion and hemp absorption.

• Triple Relief Salve – Each jar contains 250mg of full plant hemp extract. The salve is used directly on skin for pain relief in muscles, bones and joints.

• Serenity Hemp Lotion – Each bottle contains 250mg of full plant hemp extract. Lotion is meant to be applied to any part of the skin for absorption into your body.

Under its Rocky Mountain High Brands name, the Company marketed a lineup of five hemp-infused 16 oz. beverages in 2017 and 2018, including:

• Naturally Flavored Citrus Energy Drink - A citrus energy drink that contains 100mg of hempseed extract and is complemented with ginseng and guarana extract, caffeine and other ingredients

• Naturally Flavored Mango Energy Drink - A mango energy drink that contains 100mg of hempseed extract and is complemented with ginseng and guarana extract, caffeine and other ingredients.

• Low Calorie Coconut Energy Lime - A low-calorie coconut lime energy drink that contains 100mg of hempseed extract and is complemented with ginseng and guarana extract, caffeine and other ingredients.

• Naturally Flavored Lemonade - A lemonade drink that contains 100mg of hempseed extract and is complemented with ginseng extract and other ingredients.

• Naturally Flavored Black Tea - A black tea drink that contains 100mg of hempseed extract and is complemented with black tea and ginseng extract and other ingredients.

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Under its Rocky Mountain High Brands name, the Company marketed a lineup of five hemp-infused 16 oz. beverages in 2017 and 2018, including:

•

Naturally Flavored Citrus Energy Drink – A citrus energy drink that contains 100mg of hempseed extract and is complemented with ginseng and guarana extract, caffeine and other ingredients

•

Naturally Flavored Mango Energy Drink – A mango energy drink that contains 100mg of hempseed extract and is complemented with ginseng and guarana extract, caffeine and other ingredients.

•

Low Calorie Coconut Energy Lime – A low-calorie coconut lime energy drink that contains 100mg of hempseed extract and is complemented with ginseng and guarana extract, caffeine and other ingredients.

•

Naturally Flavored Lemonade – A lemonade drink that contains 100mg of hempseed extract and is complemented with ginseng extract and other ingredients.

•

Naturally Flavored Black Tea – A black tea drink that contains 100mg of hempseed extract and is complemented with black tea and ginseng extract and other ingredients.

RMHB sold its remaining inventory of these products in March 2019.

Our Eagle Spirit Land and Water Company currently markets its naturally high alkaline spring water in two sizes: a 500ml (16.9 oz.) plastic bottle sold in cases of 24 and a 110-liter (2.64-gallon) ~~bottle~~Bag ~~sold~~ in ~~cases~~a ofBox 12product. The Company also previously sold a 101-liter ~~(2.64-gallon)~~bottle ~~Bag~~ in acases ~~Box~~of ~~product~~12.

Private Label

CBD Life

In December 2017, the Company executed a three-year Master Manufacturing Agreement with CBD Alimentos SA de CV (“CBD-Alimentos”), a Mexican food and beverage distributor. Under the agreement (as amended), CBD Alimentos, through its sister company, CBD Life, will be our exclusive distributor in Mexico for all of our CBD-infused energy and functional beverages. In turn, we will be CBD ~~Alimentos~~ Life’s exclusive supplier of such products. The beverages supplied to CBD ~~Alimentos~~Life will be private label products made to order for CBD ~~Alimentos~~Life, and we will cooperate on laboratory and taste-testing of each batch of beverages at the co-packing facility. In accordance with the Agreement, RMHB opened a separate operating bank account for all deposits made by CBD ~~Alimentos~~Life towards the purchase of ingredients and packaging. CBD ~~Alimentos~~Life is required to maintain a positive cash balance in the account at all times. The Company will have full unilateral authority to disburse funds from the bank account to vendors, suppliers, co-packers and the Company solely for the purposes of production and the Company’s margin on the sale. CBD ~~Alimentos~~Life’ s initial purchase order, including a deposit of $466,300 was received in December 2018. ~~Due~~The toCompany ~~ingredient~~completed and ~~packaging~~delivered ~~sourcing delays, production did not commence~~its ~~in 2018 as expected. The Company’s~~ initial production run of ~~2,000,000~~three ~~cans~~flavors ~~is expected to be completed~~ in ~~June~~December 2019.

Green Lotus

On February 21, 2019 the Company entered into a Beverage Manufacture and Supply Agreement with Texas Wellness Center, LLC, (“TWC”)(a subsidiary of GL Brands, Inc.) a marketer and distributor of hemp and CBD products under the “Green Lotus” brand. Under the ~~Agreement~~ agreement, ~~the~~ the Company ~~will~~was benamed the exclusive supplier to ~~Texas~~ ~~Wellness~~ TWC for ~~hemp~~ CBD-infused beverages for the Green Lotus brand. ~~The~~ ~~Company~~In ~~will~~September ~~produce~~2019, ~~a Green~~the ~~Lotus Premium~~Company ~~Sparkling~~completed ~~Hemp~~its ~~Water~~initial in200,000 ~~Watermelon~~can ~~and~~production ~~Grapefruit~~run ~~flavors,~~and ~~each~~delivery ~~containing 25mg~~ of ~~naturally occurring~~the ~~cannabinoids. Texas~~Green ~~Wellness will supply~~Lotus ~~the~~branded ~~hemp-derived~~beverages. ~~ingredients~~In ~~for~~late ~~the beverages~~2019, ~~and Rocky~~TWC ~~Mountain~~informed ~~High~~the ~~Brands will~~Company ~~provide~~that ~~all~~some ~~other~~of ~~materials necessary for~~ the ~~production,~~ ~~processing,~~cans ~~batching,~~developed ~~labeling,~~leaks and ~~packaging~~were ~~of the beverages~~unsaleable. ~~The Agreement runs for~~In anMay ~~initial~~2020, ~~term~~the ofCompany ~~three~~agreed ~~years,~~to ~~with~~a ~~subsequent~~settlement ~~automatic~~and ~~annual renewals. The Agreement may~~release beagreement ~~terminated~~whereby ~~upon~~the ~~180 days written notice. The~~ Company~~’s initial~~ ~~production~~agreed ~~run~~to ofissue ~~100,000~~common ~~cans~~stock ~~is expected~~ to ~~be completed~~TWC in ~~April~~exchange ~~2019~~for mutual releases.

Upcoming Product Offerings

~~The~~In ~~Company~~May is2020 ~~currently updating~~ the ~~formulations~~Company ofbegan ~~its~~producing ~~hemp-infused~~hand sanitizer ~~drinks~~at ~~under~~its ~~the~~newly ~~Rocky~~acquired ~~Mountain~~facility ~~brand name and will reintroduce them~~ in ~~the~~Plano, ~~second quarter of 2019~~Texas. ~~These drinks will contain 250mg of hemp seed extract and be carbonated.~~

The Company’s WFLC subsidiary plans to introduce hemp-infused flavored waters under the HEMPd brand name in the second quarter of 2019. These drinks will contain 250mg of hemp seed extract be sold exclusively to our national distributor.

The Company’s Eagle Spirit subsidiary plans to launch the Spirit Water brand in 2019.

The Company plans to continually update and improve its product offerings in accordance with consumer demand, changes in federal and local regulations, and internal research and development. Ongoing research and development costs are not expected to be material.

~~Sales Channels~~6

The Company sells its products to retailers, distributors, and online directly to consumers via Amazon and the Company’s websites: www.HEMPd.com, www.EagleSpiritWater.com, and www.LiveRockyMountainHigh.com. For the year ended December 31, 2018, sales by channel were 21% distributor, 12% retailer, and 67% online. In 2018 the Company’s two largest customers represented 12% and 7% of sales.

For the year ended December 31, 2017, sales by channel were 24% distributor, 15% retailer, and 61% online. In 2017 the Company’s two largest customers represented 21% and 12% of sales.

For the six months ended December 31, 2017, sales by channel were 10% distributor, 22% retailer, and 68% online. In the same period, the Company’s two largest customers each represented 6% of sales.

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Sales Channels

The Company sells its company-branded products to retailers, distributors, and online directly to consumers via the Company’s websites www.HEMPd.com and www.EagleSpiritWater.com and Amazon and its non-company branded products to private label customers.

For the year ended December 31, 2019, sales by channel were 70% online, 13% distributor, 10% private label, and 7% retailer compared to 67% online, 21% distributor, and 12% retailer for the year ended December 31, 2018.

Outsourced Production and Storage Services

InThrough ~~May~~early ~~2016~~2018, ~~the~~Blues ~~Company~~City ~~executed~~Brewery, LLC a(“Blues ~~one-year~~City”) ~~agreement~~in ~~with~~Memphis, ~~MBA~~Tennessee, ~~Beverage~~a tosubsidiary ~~coordinate the manufacturing~~ of ~~our~~City ~~hemp-infused~~Brewing ~~beverage~~Company, ~~products.~~LLC, ~~MBA~~completed ~~Beverage~~all ~~acted as~~beverage ~~our outsourced supply-chain management~~ production and ~~coordinated~~canning. ~~every~~The ~~aspect~~Company ofcompleted ~~the~~its ~~manufacturing~~last ~~process.~~production ~~The~~run ~~contract~~with ~~expired~~Blues in ~~May 2017 and was not renewed~~2018.

~~Through~~On ~~early~~January ~~2018~~9, ~~Blues City~~2019 ~~Brewery,~~the ~~LLC (“Blues City”) in Memphis, Tennessee, a subsidiary of City Brewing~~ Company, ~~LLC,~~executed ~~completed all beverage~~an ~~production~~agreement ~~and canning. Blues City is an FDA registered facility that is audited annually to ensure compliance~~ with ~~FDA~~Optimus ~~GMP~~Fulfill ~~(Good Manufacturing~~LLC ~~Practices~~(“Optimus”) ~~for~~in ~~food~~Coppell ~~safety.~~Texas ~~MBA~~to ~~Beverage~~co-pack ~~schedules beverage production with Blues City~~beverages. ~~Upon~~The ~~completion~~Company ofdid ~~the~~not ~~production,~~complete ~~the~~any ~~Company~~production ~~stored~~runs ~~finished~~with ~~product~~Optimus atbefore ~~Blues~~Optimus ~~City,~~filed ~~awaiting~~for ~~sale.~~bankruptcy ~~The~~protection ~~Company~~in ~~did not contract with Blues City directly~~2019.

Since mid-2019, the Company has utilized Raw Pharma, a Plano, Texas-based canning facility for its 12 oz. and 16 oz. canned beverage products. On ~~January~~April 930, ~~2019~~2020 the Company purchased ~~executed~~certain anassets ~~agreement~~of ~~with~~Raw ~~Optimus~~Pharma ~~Fulfill~~and ~~LLC~~agreed into ~~Coppell~~assume ~~Texas~~Raw toPharma’s ~~co-pack~~facility ~~beverages~~sublease. ~~The~~This ~~agreement~~facility ~~terminates~~is onexpected ~~December~~to ~~31,~~provide ~~2024~~enough beverage and hand sanitizer manufacturing capacity for the foreseeable future. The Company ~~will~~plans to utilize ~~other~~a ~~co-packers~~portion of asthe ~~necessary~~space at this facility for the storage of ingredients, packaging, and finished goods, thereby eliminating or reducing the need to ~~supplement~~rent ~~Optimus’~~other ~~production~~storage ~~capabilities~~space from third parties.

The Company utilizes numerous vendors for its nutraceutical products and to collaborate on product formulation. All formulas developed for the Company through outside vendors are the property of the Company.

The Company rents storage space from various third parties on a month-to-month basis.

Our naturally high alkaline spring water is cold-filtered and packaged by a third-party water processor, Water Event Pure Water Solutions (“Water Event”).

On February 24, 2018 the Company executed an Amazon Brand Development and Launch Agreement with BuyDMi, Inc. (DBA GoodforYou.com) for the new HEMPd product line. Under this contract GoodforYou.com is creating an Amazon page for the initial 17 HEMPd products, converting all HEMPd products to Amazon Prime offerings, providing customer phone and email support, managing inventory forecasting, shipping, storage, and returns, and launching sponsored ad campaigns. The Company cancelled this contract in December 2018 and is currently performing these functions through other less expensive vendors.

On March 20, 2018 the Company executed a Fulfillment and Customer Support Services Agreement with GoodforYou.com for the new HEMPd product line. Under this contract GoodforYou.com managed inventory and providing storage, shipping, and customer support services. The Company cancelled this contract in December 2018 and is currently performing these functions through other less expensive vendors.

Regulatory Requirements

We are subject to numerous federal, state, local, and foreign laws and regulations, including those relating to:

• The production of beverages and other related products; • The preparation and sale of beverage; • Environmental protection; • Interstate commerce and taxation laws; and • Workplace and safety conditions, minimum wage and other labor requirements

•The Company’s hemp and CBD products are derived from industrial hemp, not marijuana. There is a clear scientific distinction between the two plants: The ~~preparation~~Company’s products contain less than 0.3% tetrahydrocannabinol (“THC”), the psychoactive compound found in marijuana. (Most marijuana contains over 10% THC). There is also a clear legal distinction between the two plants. While marijuana is illegal under U.S. federal law, the industrial hemp used in our products is 100% legal at the federal level. It is grown under a duly licensed state agricultural pilot program conducted by the Colorado Department of Agriculture, as authorized by the 2014 U.S. Farm Bill. The Farm Bill explicitly exempts hemp products from the definition of “marijuana” and explicitly exempts hemp products from the purview and regulation of the Controlled Substances Act. Furthermore, the 2016 Omnibus Appropriations Act specifically instructs federal agencies not to interfere with the transport or sale of ~~beverage;~~pilot program hemp products such as the ones sold by the Company. The 2018 Farm Bill specifically removed hemp from Schedule 1 of the Controlled Substances Act. The law also prohibits states from interfering with the transportation of hemp and hemp products from one state to another.

~~• Environmental protection;~~7

• Interstate commerce and taxation laws; and

• Workplace and safety conditions, minimum wage and other labor requirements

The Company’s hemp and CBD products are derived from industrial hemp, not marijuana. There is a clear scientific distinction between the two plants: The Company’s products contain less than 0.3% tetrahydrocannabinol (“THC”), the psychoactive compound found in marijuana. (Most marijuana contains over 10% THC). There is also a clear legal distinction between the two plants. While marijuana is illegal under U.S. federal law, the industrial hemp used in our products is 100% legal at the federal level. It is grown under a duly-licensed state agricultural pilot program conducted by the Colorado Department of Agriculture, as authorized by the 2014 U.S. Farm Bill. The Farm Bill explicitly exempts hemp products from the definition of “marijuana” and explicitly exempts hemp products from the purview and regulation of the Controlled Substances Act. Furthermore, the 2016 Omnibus Appropriations Act specifically instructs federal agencies not to interfere with the transport or sale of pilot program hemp products such as the ones sold by the Company. The 2018 Farm Bill specifically removed hemp from Schedule 1 of the Controlled Substances Act. The law also prohibits states from interfering with the transportation of hemp and hemp products from one state to another.

Our beverage products are not subject to direct FDA approval as the FDA does not perform review testing or approval of food, beverages or dietary supplements. The FDA requires that we manufacture our products in commercial manufacturing facilities that are annually audited to ensure that they pass inspection based on Good Manufacturing Practices for food safety.

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Employees and Independent Contractors

The Company currently has ~~four~~ three officers and two ~~five~~ non-officer employees. The Company uses independent contractors, when necessary, to support operational or back-office functions.

Implications of Emerging Growth Company Status

As a company with less than $1 billion in revenue in our last fiscal year, we are defined as an “emerging growth company” under the Jumpstart Our Business Startups (“JOBS”) Act. We will retain “emerging growth company” status until the earliest of:

•

The last day of the fiscal year during which our annual revenues are equal to or exceed $1 billion;

•

The last day of the fiscal year following the fifth anniversary of our first sale of common stock pursuant to a registration statement filed under the Securities Act of 1933, as amended, which we refer to in this document as the Securities Act;

•

The date on which we have issued more than $1 billion in nonconvertible debt in a previous three-year period; or

•

The date on which we qualify as a large accelerated filer under Rule 12b-2 adopted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (i.e., an issuer with a public float of $700 million that has been filing reports with the U.S. Securities and Exchange Commission (“SEC”) under the Exchange Act for at least 12 months).

•

As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to SEC reporting companies. For so long as we remain an emerging growth company we will not be required to:

•

Have an auditor report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Wall Street Reform and Consumer Protection Act of 2002;

•

Comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);

•

Submit certain executive compensation matters to stockholder non-binding advisory votes;

•

Submit for stockholder approval golden parachute payments not previously approved;

•

Disclose certain executive compensation related items, as we will be subject to the scaled disclosure requirements of a smaller reporting company with respect to executive compensation disclosure; and

•

Present more than two years of audited financial statements and two years of selected financial data in a registration statement for our initial public offering of our securities.

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Pursuant to Section 107(b) of the JOBS Act, we have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of The JOBS Act. This election allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result, our financial statements may not be comparable to companies that comply with public company effective dates. Section 107 of the JOBS Act provides that our decision to opt into the extended transition period for complying with new or revised accounting standards is irrevocable.

Because the worldwide market value of our common stock held by non-affiliates, or public float, is below $75 million, we are also a “smaller reporting company” as defined under the Exchange Act. Some of the foregoing reduced disclosure and other requirements are also available to us because we are a smaller reporting company and may continue to be available to us even after we are no longer an emerging growth company under the JOBS Act but remain a smaller reporting company under the Exchange Act. As a smaller reporting company we are not required to:

•

Have an auditor report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; and

•

Present more than two years of audited financial statements in our registration statements and annual reports on Form 10-K and present any selected financial data in such registration statements and annual reports.

Item 1A. Risk Factors.

Smaller reporting companies are not required to provide the information required by this item. Please see our Registration Statement on Form S-1/A filed ~~October 9~~June 12, ~~2018~~2019 to review our current risk factors.

Item 2. Properties

At present, we do not own any real property. As of December 31, ~~2018~~2019, we leased approximately 7,000 square feet of office space atfor ~~9101~~our ~~LBJ~~corporate ~~Freeway, Suite 200, Dallas, Texas 75243~~offices. Our lease period began on September 1, 2016 and ~~terminates~~terminated on August 31, 2019. Payments under the lease are as follows:

Lease Period	~~Base Rent (monthly)~~	Base Rent (monthly)
~~9/1/2016 to 8/31/2017~~	~~$7,715.00~~9/1/2016 to 8/31/2017	$	7,715.00
~~9/1/2017 to 8/31/2018~~	~~$7,972.17~~9/1/2017 to 8/31/2018	$	7,972.17
~~9/1/2018 to 8/31/2019~~	$9/1/2018 to 8~~,229.33~~/31/2019	$	8,229.33

InOn ~~connection~~September ~~with the new lease~~5, we ~~also~~2019 ~~purchased used office furniture from~~ the ~~landlord~~Company ~~and~~executed ~~financed this purchase with~~ a six-month ~~note~~extension ~~payable~~of inits ~~the~~corporate ~~amount~~office oflease at $408,~~122 with~~065 anper ~~interest~~month ~~rate~~plus ofcommon 0%area ~~and~~maintenance. ~~monthly~~The ~~payments~~lease ofexpired $1on February 29,~~114~~ ~~over thirty-six monthly installments~~2020.

On ~~January~~February 1828, ~~2018,~~2020 the ~~RMHC~~Company ~~entered into~~executed a 12 six-month ~~office~~extension ~~use~~of ~~agreement~~its ~~for~~corporate office ~~space~~lease. inThe ~~Denver,~~lease ~~Colorado.~~includes ~~Monthly~~new ~~payments~~space ~~are~~within ~~$91.~~the ~~This~~same ~~agreement~~office ~~renewed~~building onat a monthly payment ~~January~~of 19$3,549 ~~2019~~per ~~for~~month ~~another~~plus ~~12-month~~common ~~period~~area maintenance.

~~The~~On ~~Company~~January ~~leases~~18, ~~the~~2018, ~~following warehouse~~WFLC ~~space~~entered oninto a ~~month~~12-~~to-~~month office ~~basis:~~use agreement for office space in Denver, Colorado. Monthly payments were $91. The lease automatically renews for 12 months each January. Monthly payments in 2019 were $101.

~~• Water Event, Carrollton, Texas – We lease space for both hemp-infused beverages and spring water.~~ The Company ~~also~~leases ~~stores small quantities of ice barrels and other packaging at this location. As of March 30, 2019,~~ the ~~Company~~following ~~held~~warehouse space noon ~~inventory~~a atmonth-to-month ~~this location.~~basis:

• ~~American~~Legendz ~~Fitness~~Way ~~Wholesale~~Distribution Solutions, ~~Tempe~~Grand Prairie, ~~Arizona~~Texas – We lease space on a month-to-month basis for ~~FitWhey~~both CBD-infused beverages atand ~~this~~spring ~~location~~water.

•Our ~~Pet~~monthly ~~Healthy~~rent ~~Brands,~~varies ~~Dallas,~~depending ~~Texas~~on –how Wemuch inventory ~~lease~~is ~~space~~stored. onInventory alevels ~~month-to-month~~fluctuate ~~basis~~based ~~for~~on ~~packaging~~production and ~~ingredients at this location~~sales.

~~Our~~In ~~monthly~~April ~~rent~~2020 ~~varies~~the Company executed an agreement ~~depending~~to onpurchase ~~how~~certain ~~much~~assets ~~inventory~~from isRaw ~~stored~~Pharma, LLC (“Raw Pharma”). ~~Inventory~~The ~~levels~~agreement ~~fluctuate~~included ~~based~~the onsublease of Raw Pharma’s production facility. The Company plans to utilize a portion of the space at this facility for the storage of ingredients, packaging, and ~~sales~~finished goods, thereby eliminating or reducing the need to rent other storage space from third parties.

~~The Company is currently evaluating its growth requirements and researching alternatives to lower its recurring expenses for warehouse space.~~9

10Table of Contents

~~Table~~Item of3. ~~Contents~~Legal Proceedings

~~Item~~Rocky Mountain High Brands, Inc. v Lyonpride Music, LLC, United States District Court Northern District of Texas, 3:18-cv-00045-C, now Lyonpride Music LLC v Rocky Mountain High Brands, Inc., ~~Legal~~Before ~~Proceedings~~the American Arbitration Association, 01-18-0003-1428.

~~Rocky~~The ~~Mountain~~Company ~~High~~filed ~~Brands, Inc.~~a vsuit ~~Lyonpride~~against Lyonpride Music, LLC, ~~United~~(“Lyonpride”) ~~States~~for ~~District~~fraud ~~Court~~and ~~Northern~~for ~~District~~declaratory ofrelief ~~Texas,~~with ~~3:18-cv-00045-C,~~respect ~~now~~to ~~Lyonpride~~a ~~Music~~contract ~~LLC~~between the parties. Lyonpride vsought ~~Rocky~~monetary ~~Mountain~~damages ~~High~~from ~~Brands,~~the ~~Inc~~Company for breach of contract and the Company sought monetary damages against Lyonpride., ~~Before~~The parties have settled the ~~American~~matter ~~Arbitration~~and ~~Association,~~are ~~01-18-0003-1428~~in the process of finalizing settlement documents. The settlement documents have had to be modified because of the Covid 19 issue as a portion of the settlement relates to performance by Lyonpride and the scheduling of the performance has had to be extended.

~~The~~Dallas ~~Company~~County ~~filed~~Texas, aCase ~~suit~~Number ~~against~~DC-17-15441 ~~Lyonpride~~filed ~~Music~~November 8, ~~LLC~~2017. ~~(“Lyonpride”)~~Rocky ~~for~~Mountain ~~fraud~~High ~~and~~Brands, ~~for~~Inc. ~~declaratory~~f/k/a ~~relief~~Republic ~~with~~of ~~respect~~Texas toBrands, aInc. ~~contract~~Plaintiff, ~~between the parties~~vs. ~~Lyonpride~~ isJerry ~~seeking~~Grisaffi, ~~monetary~~Joe Radcliffe, ~~damages~~LSW ~~from~~Holdings, ~~the~~LLC, ~~Company~~Lily ~~for~~Li, ~~breach~~Epic ofGroup ~~contract~~One, ~~and~~LLC, ~~the~~Kenneth ~~Company~~Radcliffe, isDennis ~~seeking~~Radcliffe, ~~monetary~~Phil ~~damages~~Uhrik, ~~against~~Michael Radcliffe, ~~Lyonpride.~~Frank ~~The~~Izzo, ~~case~~Morgan ~~has~~Albright, ~~been~~John ~~referred~~Garrison, toBB ~~binding~~Winks, ~~arbitration~~LLC, asCrackerjack ~~referenced~~Classic, ~~above.~~LLC, ~~The~~and ~~parties~~Universal ~~are~~Consulting, ~~conducting discovery~~LLC.

~~Dallas~~The ~~County~~Company ~~Texas,~~sought ~~Case Number~~the ~~DC-17-15441~~return ~~filed~~of ~~November~~the 8,Series A ~~2017.~~Preferred ~~Rocky~~Stock ~~Mountain~~(“Series ~~High~~A”) ~~Brands,~~issued ~~Inc.~~to ~~f/k/a Republic of Texas Brands, Inc. Plaintiff, vs.~~ Jerry Grisaffi, ~~Joe Radcliffe~~(“Grisaffi”), ~~LSW~~RMHB’s ~~Holdings,~~former ~~LLC,~~Chairman ~~Lily~~of ~~Li,~~the Board. ~~Epic~~The ~~Group~~Company ~~One,~~further ~~LLC~~alleged, ~~Kenneth~~among ~~Radcliffe,~~other ~~Dennis Radcliffe~~things, ~~Phil~~that ~~Uhrik, Michael~~Grisaffi ~~Radcliffe,~~breached ~~Frank~~his ~~Izzo,~~fiduciary ~~Morgan~~duty ~~Albright,~~to ~~John~~the ~~Garrison,~~Company BBby ~~Winks,~~issuing ~~LLC,~~these Series ~~Crackerjack~~A ~~Classic,~~shares ~~LLC,~~to ~~and Universal Consulting, LLC~~himself.

~~The~~On ~~Company~~August ~~sought~~30, 2018, the ~~return of~~Trial ~~our~~Court ~~Series~~in Athe 192nd ~~Preferred~~District ~~Stock~~Court ~~(“Series A”) issued to Jerry Grisaffi (“Grisaffi”), RMHB’s former Chairman~~ of ~~the~~Dallas ~~Board~~County, ~~and~~Texas ~~common~~entered ~~stock~~a ~~issued~~final tojudgment ~~certain~~in ~~other~~the ~~defendants~~Company’s orfavor ~~later~~and ~~obtained~~against byGrisaffi ~~certain~~in ~~other defendants for little~~the oramount noof ~~consideration paid to the Company. The Company alleged~~$3,500,000 ~~among~~for ~~other things~~fraud, ~~that~~breach ~~Grisaffi~~of ~~breached his~~ fiduciary duty, ~~to the~~and ~~Company~~conversion bywith ~~issuing~~respect ~~these~~to the Series A ~~shares~~preferred ~~to himself and common~~ stock ~~to himself and others~~. ~~RMHB~~The ~~also~~Court further ~~sought~~voided toab ~~void~~initio the ~~Indemnification and~~Series ~~Release~~A ~~Agreement~~Preferred ~~(“Indemnification”)~~Shares. ~~between~~The ~~the~~Court ~~Company~~further ~~and~~ruled that Grisaffi ~~that~~take ~~was~~nothing ~~executed~~by his counterclaims in ~~June~~the ~~2017~~case.

~~Grisaffi~~In ~~filed~~The aCourt ~~counterclaim against~~Of ~~the~~Appeals ~~Company~~For ~~seeking~~The ~~payment~~Fifth ~~for two promissory notes allegedly owed to him, as well as relief under the Indemnification.~~ District ~~Those~~Of ~~notes~~Texas ~~have been accounted for in the Company’s consolidated financial statements. Those counterclaim matters had been proactively addressed in the Company’s original suit~~Dallas, ~~seeking to void the Indemnification and the two notes based on~~Texas, ~~among other~~Jerry ~~things~~Grisaffi, ~~fraud~~Appellant ~~of Grisaffi~~v. ~~Grisaffi~~ ~~had~~Rocky ~~also~~Mountain ~~filed~~High aBrands, ~~derivative~~Inc, ~~suit within the main lawsuit. The Company filed~~ f/k/a ~~motion~~Republic toof ~~dismiss~~Texas ~~the derivative suit and on August 3~~Brands, ~~2018 the Trial Court entered an Order Dismissing Derivative Claims~~Inc., ~~dismissing~~Appellee, ~~the derivative suit with prejudice~~No. ~~That Order is final~~05-18-01020-CV.

InGrisaffi ~~June~~appealed ~~2018~~the ~~LSW~~Judgment ~~Holdings,~~described ~~LLC~~above. ~~(“LSW”)~~The ~~and~~Court ~~Lily~~of LiAppeals ~~(“Li”)~~affirmed ~~filed~~in ~~counterclaims~~part ~~against~~and ~~the~~reversed ~~Company,~~in ~~generally~~part ~~seeking~~the anJudgment ~~increase~~and ofremanded ~~voting rights~~it ofto the ~~Series~~trial Acourt ~~shares~~for tothe ~~1200:1,~~purpose aof ~~declaration that~~ the Company ~~Series~~electing Aits ~~shares~~remedy. ~~were~~The ~~validly~~Company ~~issued~~has toelected ~~Grisaffi,~~its ~~challenging~~remedy ~~the authorized share increase~~ of the ~~Company~~$3,500,000 ~~claiming~~judgment ~~securities~~against ~~fraud~~Grisaffi. byGrisaffi ~~the~~has ~~Company~~again appealed ~~with~~this ~~respect~~matter. toOn ~~the~~November ~~Series~~19, A2019, ~~Shares purchased from~~ Grisaffi ~~and~~filed ~~other~~a ~~common~~chapter ~~stock~~11 ~~allegedly~~bankruptcy ~~purchased~~in bythe ~~LSW~~United ~~and~~States ~~Li,~~Bankruptcy asCourt ~~well~~for asthe Northern ~~fraud,~~District ~~breach~~ of ~~contract~~Texas, ~~and~~Case ~~negligent~~No. ~~misrepresentation by~~19-33855-sgj. ~~the~~The Company. ~~LSW~~has ~~seeks~~filed ~~$10,000,000~~an inAdversary ~~damages~~Proceeding ~~from~~to ~~the~~deny ~~Company,~~Grisaffi ~~for~~ the ~~$3,500,000~~ability ~~which was paid~~ to discharge ~~Grisaffi for~~ the ~~Series A~~judgment ~~shares~~ and ~~for~~has ~~which~~filed ~~LSW~~a ~~claims~~motion to beremove Grisaffi as the ~~responsibility~~debtor ofin ~~the~~possession ~~Company~~or to ~~cover,~~convert ~~and~~ the ~~remaining~~case ~~$6,500,000~~to ~~for~~a ~~money allegedly~~Chapter ~~spent~~7. byThe ~~LSW~~case inhas ~~“developing~~been aconverted ~~distribution~~by ~~system in China” and other alleged “investments” of Li and LSW in~~ the ~~Company.~~Bankruptcy ~~LSW~~Court ~~and~~to Lia ~~also~~Chapter ~~sought~~7 ~~exemplary damages~~case.

OnDallas ~~August~~County 30Texas, ~~2018,~~Case ~~the~~Number ~~Trial~~DC-18-13491. ~~Court~~Rocky ~~entered~~Mountain aHigh ~~final~~Brands, ~~judgment~~Inc. ~~and~~f/k/a ~~order~~Republic inof ~~the~~Texas ~~Company’s~~Brands, ~~favor~~Inc. ~~and~~Plaintiff, ~~against Grisaffi~~vs. OnJoe ~~August~~Radcliffe, 29LSW Holdings, ~~2018~~LLC, ~~after~~Lily aLi, Epic ~~show~~Group ~~cause hearing~~One, ~~the~~LLC, ~~Trial~~Kenneth ~~Court~~Radcliffe, ~~entered~~Dennis anRadcliffe, ~~order~~Phil ~~sanctioning~~Uhrik, ~~Grisaffi~~Michael ~~for~~Radcliffe, ~~his~~Frank ~~repeated~~Izzo, ~~and~~Morgan ~~unexcused~~Albright, ~~refusals~~John ~~to make discovery in the~~Garrison, ~~case.~~BB ~~As a sanction~~Winks, ~~the Trial Court struck Grisaffi’s pleadings in the case and~~LLC, onCrackerjack ~~August 30~~Classic, ~~2018~~LLC, ~~entered~~and aUniversal ~~Default~~Consulting, ~~Judgment against him~~LLC. ~~Under the Trial Court’s Default Judgment:~~

~~1. The~~This is the surviving case of the above case, having been severed on September 12, 2018. In this case, on August 12, 2019 the Court entered aas ~~monetary~~Final ~~judgment~~Judgment, against ~~Grisaffi~~Lily Li and LSW, holding that all Series A Preferred Shares in ~~favor~~RMHB, ofincluding the ~~Company~~shares issued to Grisaffi and later sold by him to LSW evidenced by Stock Certificate N0. 604 issued by RMHB, to LSW Holdings LLC in the amount of 1,000,000 shares, were void ab initio, and any potential rights thereunder were terminated. The Court further entered joint and several judgments against Lily Li and LSW Holdings LLC for $3,500,000, ~~for~~which ~~fraud,~~was ~~breach~~also ofjoint and several with the Final Judgment against Grisaffi. This Final Judgment ~~fiduciary~~against ~~duty~~Lily Li and LSW Holdings, LLC is final for all purposes and ~~conversion~~was ~~with~~not ~~respect~~appealed. The Company plans to outsource the ~~Series~~collection of Athis ~~preferred~~Judgment. The remaining Defendants settled with the Company by either returning shares of stock in the Company or paying a settlement sum to the Company which totaled $200,000. Other than collection of the Judgment this matter has been finalized.

~~2. The Court~~Rocky ~~declared~~Mountain ~~that~~High ~~the Employment Agreement with Grisaffi dated April 1~~Brands, ~~2013~~Inc. ~~was~~v ~~void ab~~La ~~initio and unenforceable,~~Dolce ~~and~~Vita ~~that~~Trust ~~all stock~~ and ~~promissory~~Christine ~~notes~~Guthrie, ~~issued~~In inHer ~~connection~~Capacity ~~with~~As ~~the~~Trustee, ~~Employment~~In ~~Agreement~~The ~~were~~382nd ~~also~~District ~~void ab~~Court ~~initio and~~ of noRockwall ~~force~~County, ~~and effect~~Texas, ~~including~~Cause ~~but~~No. 1-18-1608. ~~not limited to:~~

~~a. The 1,000,000 shares of Series A Preferred Stock issued to Grisaffi;~~10

~~b. The~~Table ~~Convertible Promissory Note issued to Grisaffi in the principal amount~~ of ~~$184,300 dated April 1, 2016; and~~Contents

cThis is a case whereby the Company is attempting to collect on the Judgment obtained against Grisaffi. More specifically the Company is requesting the Court to order the La Dolce ~~The~~Vita ~~Convertible~~Trust ~~Promissory~~to ~~Note~~turnover ~~issued~~fraudulently transferred assets and for additional relief necessary to enforce the Company’s judgment against Grisaffi. inGrisaffi ~~the~~is ~~principal~~attempting ~~amount~~to ofstay ~~$200~~this case with his bankruptcy,~~150~~ ~~dated~~the ~~June~~Company 19will seek an order from the Bankruptcy Court to continue in this case, ~~2017.~~or will work in conjunction with the Trustee appointed in the Chapter 7 case on this matter

~~3. The~~Chet ~~Court~~– ~~declared~~5 ~~that~~Broadcasting, ~~Grisaffi’s~~Inc. ~~sale~~v ofRocky Mountain ~~the~~High ~~Series~~Brands, AInc., ~~Preferred~~Supreme ~~Stock~~Court toof ~~LSW~~the ~~was~~State ~~made~~of ~~with~~New ~~actual~~York, ~~intent~~County toof ~~hinder~~Ulster, ~~delay,~~ orCase ~~defraud~~No. ~~creditors and was thus a fraudulent transfer under Texas law~~18-4416.

4. The ~~Court~~Plaintiff ~~declared~~sued ~~that~~ the ~~issuance~~Company, ofseeking 10$21,000~~,000~~ in ~~shares~~damages offor ~~common~~breach ~~stock~~of tocontract. LiThe ~~and~~Company ~~the~~contested ~~11,000,000~~that ~~shares~~claim ofin ~~common~~its ~~stock issued~~entirety toand ~~Epic~~filed ~~One~~a ~~Group,~~counterclaim ~~LLC~~against ~~were~~the ~~made~~Plaintiff for ~~without~~an ~~lawful~~unspecified ~~consideration,~~amount ~~and~~of ~~constituted~~damages. ~~breaches~~The ofparties ~~fiduciary~~have ~~duty~~settled bythis ~~Grisaffi~~matter.

5Item 4. ~~The~~ ~~Court~~Mine ~~declared~~Safety ~~that an Indemnification was procured through fraud and breach of fiduciary duty and is therefore void and unenforceable.~~Disclosures

~~6. The~~Not ~~Court ruled that Grisaffi shall take nothing by his counterclaims in the case~~applicable.

11PART II

~~Table~~Item 5. Unregistered Sales of ~~Contents~~Equity Securities and Use of Proceeds Between November 19, 2019 and June 1, 2020:

Furthermore, the Court ruled that our continuing claims against the other defendants in the case were to be severed and docketed under a separate cause of action and case number. We have continued to pursue our claims against the other defendants in the below referenced case.

Date	Name	Shares Issued	Issue Price	Description	Exemption
11/26/2019	GHS Investments	3,012,473	$ 0.026	Shares Sold	Rule 506
12/10/2019	GHS Investments	1,090,974	0.017	Shares Sold	Rule 506
1/14/2020	GHS Investments	3,980,411	0.030	Note Payable Conversion	Rule 506
3/17/2020	GHS Investments	3,156,673	0.020	Note Payable Conversion	Rule 506
3/20/2020	Charles Smith	500,000	0.020	Preferred Stock Conversion	Rule 506
3/20/2020	Charles Smith	4,895,286	0.020	Services Rendered	Section 4(2)
3/20/2020	John Kuhlke	802,700	0.020	Services Rendered	Section 4(2)
3/31/2020	GHS Investments	5,300,000	0.010	Note Payable Conversion	Rule 506
4/8/2020	Eagle Processing & Distribution	50,000,000	0.021	Services Rendered	Section 4(2)
4/13/2020	Michael Welch	7,000,000	0.017	Services Rendered	Section 4(2)
4/13/2020	David Seeberger	7,000,000	0.017	Services Rendered	Section 4(2)
4/13/2020	Jens Mielke	7,000,000	0.017	Services Rendered	Section 4(2)
4/13/2020	Dean Blythe	750,000	0.017	Services Rendered	Section 4(2)
4/13/2020	Kathy Fernandez	250,000	0.017	Services Rendered	Section 4(2)
4/13/2020	Oscar Herrera	250,000	0.017	Services Rendered	Section 4(2)
4/29/2020	GHS Investments	6,000,000	0.010	Note Payable Conversion	Rule 506
5/6/2020	Raw Pharma, LLC	27,000,000	0.017	Business Acquisition	Rule 506
5/6/2020	GL Brands, Inc.	17,500,000	0.017	Legal Settlement	Rule 506
5/12/2020	Don Rodgers	150,000	0.022	Services Rendered	Section 4(2)
5/21/2020	GHS Investments	3,976,484	0.010	Note Payable Conversion	Rule 506
5/21/2020	CHET-5 BROADCASTING, L.P.	425,000	0.022	Legal Settlement	Rule 506

~~The~~Market ~~judgment and order entered August 30, 2018 concludes our litigation in district court as against Grisaffi. On September 4, 2018, Mr. Grisaffi filed a Notice of Appeal in the case against him.~~Information

InOur ~~The~~common ~~Court~~stock Ofis ~~Appeals~~quoted on the OTCQB tier ~~For~~of ~~The~~the ~~Fifth~~OTC ~~District~~Markets OfGroup ~~Texas~~quotation ~~Dallas,~~system ~~Texas,~~(www.otcmarkets.com) ~~Jerry~~under ~~Grisaffi,~~the ~~Appellant~~trading vticker “RMHB.” ~~Rocky~~The ~~Mountain~~following tables ~~High~~set ~~Brands~~forth the range of high and low prices for our common stock for the two years ended December 31, ~~Inc~~2019, ~~f/k/a~~as ~~Republic~~reported ofon ~~Texas~~the ~~Brands,~~OTC ~~Inc~~Market Group’s quotation system. These quotations reflect inter-dealer prices, ~~Appellee~~without retail markup, ~~No.~~markdown, ~~05-18-01020-CV.~~or commission and may not necessarily represent actual transactions.

Grisaffi has filed an appeal of the Default Judgment, and submitted his brief on or about February 28, 2019. The Company is preparing its brief which is currently due April 1, 2019. Grisaffi did not appeal the Order Dismissing Derivative Claims. Grisaffi only seeks in his appeal to reverse in part the Default Judgment by striking the paragraph awarding monetary damages, leaving the remainder of the Default Judgment intact.

Quarter Ended:	High Sale Price		Low Sale Price
March 31, 2018	$	0.61	$	0.24
June 30, 2018	$	0.34	$	0.20
September 30, 2018	$	0.27	$	0.15
December 31, 2018	$	0.33	$	0.15
March 31, 2019	$	0.28	$	0.08
June 30, 2019	$	0.27	$	0.04
September 30, 2019	$	0.13	$	0.05
December 31, 2019	$	0.05	$	0.02

~~Dallas~~On ~~County~~July ~~Texas~~6, ~~Case Number DC-18-13491. Rocky Mountain High Brands~~2020, ~~Inc.~~the ~~f/k/a~~last ~~Republic~~sales ofprice ~~Texas Brands, Inc. Plaintiff, vs. Joe Radcliffe, LSW Holdings,~~per ~~LLC,~~share ~~Lily~~of ~~Li,~~our ~~Epic~~common ~~Group~~stock ~~One,~~was ~~LLC, Kenneth Radcliffe, Dennis Radcliffe, Phil Uhrik, Michael Radcliffe, Frank Izzo, Morgan Albright, John Garrison, BB Winks, LLC, Crackerjack Classic, LLC, and Universal Consulting, LLC~~$0. 026.

This is the surviving case of the above case, having been severed on September 12, 2018. In this case, on October 26, 2018 the Court granted our Motion For Summary Judgment, per a Summary Judgment Order, against LSW, holding that all Series A Preferred Shares in RMHB, including the shares issued to Grisaffi and later sold by him to LSW evidenced by Stock Certificate N0. 604 issued by RMHB, to LSW Holdings LLC in the amount of 1,000,000 shares, were void ab initio, and any potential rights thereunder were terminated as of July 11, 2014, when the bankruptcy court signed the Order Confirming Debtor’s Amended Plan of Reorganization. The Series A Preferred Shares have no legal force or effect. The Court also granted a take nothing judgment against LSW on counterclaim Counts 1, 2 and 3. The Company’s transfer agent has cancelled the Series A Preferred Shares. Later, on November 26, 2018, the Court entered an Order of Sanctions against Li and LSW. In the Order of Sanctions, and in response to Li and LSW’s repeated refusals to make proper discovery in the case, the Court struck the pleadings of these parties and ruled that RMHB was entitled to take a default judgment against them.

OnTable ~~February~~of ~~4, 2019, the Court entered its Default Judgment against Li and LSW. In the Default Judgment, the Court ruled as follows:~~Contents

1.Penny The Employment Agreement with Grisaffi dated April 1, 2013 was void ab initio and unenforceable, and that all stock or other instruments issued on the basis or authority of that Employment Agreement were also void ab initio and of no force and effect;Stock

2The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. ~~The~~Penny ~~Series~~stocks Aare ~~Preferred~~generally ~~Shares~~equity securities with a market price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that ~~RMHB~~current ~~issued~~price and volume information with respect to ~~Grisaffi~~transactions ~~and~~in ~~later~~such ~~sold~~securities is provided by ~~Grisaffi~~the exchange or system. The penny stock rules require a broker-dealer, prior to ~~LSW~~a ~~were~~transaction ~~void~~in aba ~~initio~~penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that: (a) contains a description of the nature and ~~any~~level ~~potential~~of ~~rights~~risk in the market for penny stocks in both public offerings and secondary trading; (b) contains a description of the broker's or dealer's duties to the customer and of the rights and remedies ~~thereunder~~available ~~were~~to ~~terminated~~the oncustomer ~~July~~with 11respect to a violation of such duties or other requirements of the securities laws; (c) contains a brief, ~~2014~~clear, ~~pursuant~~narrative todescription of a dealer market, including bid and ask prices for penny stocks and the ~~Order~~significance ~~Confirming~~of ~~Debtor’s~~the ~~Amended~~spread ~~Plan~~between the bid and ask price; (d) contains a toll-free telephone number for inquiries on disciplinary actions; (e) defines significant terms in the disclosure document or in the conduct of ~~Reorganization~~trading in penny stocks; and (f) contains such other information and is in such form, including language, type size and format, as the SEC shall require by rule or regulation.

3.The ~~Grisaffi’s~~broker-dealer ~~issuance~~also ~~and~~must ~~transfer~~provide, prior to ~~himself~~effecting ofany ~~the~~transaction 1in a penny stock,~~000,000~~ ~~Series~~the Acustomer ~~Preferred~~with ~~Shares,~~(a) bid and ~~his~~offer ~~subsequent~~quotations ~~transfer~~for the penny stock; (b) the compensation of ~~those~~the broker-dealer and its salesperson in the transaction; (c) the number of shares to ~~LSW~~which ~~Holdings~~such bid and ask prices apply, ~~were~~or other ~~fraudulent~~comparable ~~transfers~~information ~~and~~relating ~~are~~to ~~voided~~the depth and ~~set~~liquidity ~~aside~~of the market for such stock; and (d) a monthly account statement showing the market value of each penny stock held in the customer's account.

4.In ~~Grisaffi~~addition, ~~breached~~the ~~his~~penny ~~fiduciary~~stock ~~duties~~rules torequire that ~~RMHB~~prior ~~by,~~to ~~among~~a ~~other~~transaction ~~things:~~in ~~(i),~~a ~~purporting~~penny tostock ~~sell~~not ~~the~~otherwise ~~Series~~exempt Afrom ~~Preferred~~those ~~Shares to LSW~~rules, ~~(ii)~~the ~~causing~~broker-dealer ~~the~~must ~~issuance~~make ofa ~~11,000,000~~special ~~shares~~written determination ofthat ~~common~~the penny stock tois ~~Epic~~a ~~Group~~suitable ~~One,~~investment ~~LLC,~~for the purchaser and ~~10,000,000~~receive ~~shares~~the purchaser's written acknowledgment of ~~common~~the ~~stock~~receipt toof Lia ~~for~~risk nodisclosure ~~consideration~~statement, ~~and~~a ~~(iii)~~written ~~causing~~agreement ~~the~~as ~~issuance~~to oftransactions ~~113~~involving penny stocks,~~688,625~~ ~~shares~~and toa ~~the~~signed ~~Radcliffe~~and dated ~~Group~~copy atof ~~deeply~~a ~~discounted~~written ~~prices;~~suitability statement.

5.These ~~LSW~~disclosure ~~and~~requirements Limay ~~knowingly~~have ~~participated~~the effect ~~in Grisaffi’s breaches~~ of ~~fiduciary~~reducing ~~duty~~the ~~and~~trading ~~are~~activity ~~therefore~~for ~~jointly~~our ~~and~~common ~~severally~~stock. ~~liable~~Therefore, ~~for~~stockholders ~~all~~may ~~damages~~have ~~and~~difficulty ~~equitable~~selling ~~relief~~our ~~arising from such breaches;~~securities.

~~6. The issuance of 10,000,000 shares of common stock to Li was not authorized by the Board of Directors and was both void ab initio and a fraudulent conveyance;~~Dividends

7.There ~~RMHB~~are isno ~~entitled~~restrictions toin ~~recover~~our ~~all~~articles ~~damages~~of incorporation ~~proximately~~or ~~resulting~~bylaws that prevent us from ~~the~~declaring ~~improper~~dividends. ~~issuance~~The ofNevada ~~the~~Revised 10Statutes,~~000~~ however,~~000~~ ~~shares~~do ofprohibit ~~common~~us ~~stock~~from declaring dividends where after giving effect to ~~Li;~~the distribution of the dividend:

81. we Liwould ~~did~~ not ~~perform~~be ~~and~~able ~~materially~~to ~~breached~~pay ~~her~~our ~~agreement~~debts toas ~~raise~~they ~~money~~become ~~for~~due ~~RMHB~~in the usual course of business, or;

92. our ~~The~~total ~~10,000,000~~assets ~~shares~~would ofbe ~~purported~~less ~~common~~than ~~stock~~the ~~issued~~sum toof Liour ~~belongs~~total toliabilities ~~RMHB~~plus ~~and~~the Liamount ~~has~~that nowould ~~further~~be needed to satisfy the rights orof ~~remedies~~shareholders ~~arising~~who ~~out~~have ofpreferential orrights ~~related~~superior to ~~the~~those ~~10,000,000~~receiving ~~shares;~~the distribution.

12 We have not declared any dividends and we do not plan to declare any dividends in the foreseeable future.

~~Table~~Securities ofAuthorized ~~Contents~~for Issuance under Equity Compensation Plans

10On March 17, 2017, our Board of Directors approved the Rocky Mountain High Brands, Inc. By2017 ~~virtue~~Incentive Plan (the “2017 Incentive Plan”). The purpose of ~~their~~the ~~actions~~Incentive Plan ~~described~~is ~~above~~to provide a means for the Company to continue to attract, Limotivate and ~~LSW~~retain ~~have~~management, ~~taken~~key ~~advantage~~employees, ofconsultants ~~RMHB~~and other independent contractors, and ~~have~~to ~~unjustly~~provide ~~enriched~~these ~~themselves~~individuals atwith ~~Rocky~~greater ~~Mountain~~incentive ~~High~~for ~~Brands~~their service to the Company by linking their interests in the Company’s ~~expense,~~success with those of the Company and ~~RMHB~~its isshareholders. ~~entitled~~Initially, the Board authorized 1,750,000 shares of the Company’s common stock to ~~full~~be ~~restitution~~included in the Plan. The Board of ~~all~~Directors awards these shares at its ~~losses~~sole ~~and~~discretion. ~~damages;~~On July 14, 2017 the Board of Directors increased the authorized shares in the 2017 Incentive Plan to 3,250,000. On December 19, 2017 the Board of Directors increased the authorized shares in the 2017 Incentive Plan to 5,000,000.

11. LSW Holdings and Li engaged in a civil conspiracy with Grisaffi to commit the wrongs against RMHB described above, and RMHB is entitled to recover from them actual, consequential, and special damages resulting from such wrongs, including their knowing participation in Grisaffi’s breaches of fiduciary duty, breaches of contract, receipt of fraudulent conveyances, and unjust enrichments.12

~~12.~~Table ~~The~~of ~~torts against RMHB committed by LSW Holdings and Li were aggravated by fraud and malice, and RMHB is therefore entitled to exemplary damages.~~Contents

13During the year ended December 31, 2019, the Company issued 125,000 options to purchase common stock to an employee. ~~LSW~~The ~~Holdings~~employee was terminated during 2019 and Lithe ~~shall~~options were ~~take~~forfeited ~~nothing~~prior byto ~~their~~vesting. ~~counterclaims;~~The options had a vesting schedule of 2 years and an exercise price of $.20. Also during 2019, former members of the Board of Directors and consultants forfeited 2,312,839 options to purchase common stock. As of December 31, 2019 are were no options issued and outstanding.

~~14.~~During ~~RMHB~~the isyear ~~entitled~~ended December 31, 2018, the Company issued 678,339 options to ~~court~~purchase ~~costs~~common stock. The options had an exercise price of $.06 and ~~reasonable~~vested ~~attorneys’~~immediately. ~~fees~~During the ~~from~~year ~~LSW~~ended ~~Holdings~~December 31, 2018, 1,755,000 options were exercised and Linone were forfeited. As of December 31, 2018, there were 2,312,839 options issued and outstanding.

~~The~~Item ~~amount of damages and attorneys’ fees to be awarded to RMHB and against LSW Holdings and Li will be determined in a trial currently scheduled for June 3, 2019~~6. We ~~are~~Selected ~~continuing~~Financial ~~to pursue our claims against the remaining defendants in the case, which will be adjudicated at trial, currently scheduled for June 3, 2019.~~Data

~~Rocky~~A ~~Mountain~~smaller ~~High~~reporting ~~Brands, Inc.~~company vis Lanot ~~Dolce~~required to ~~Vita~~provide ~~Trust~~the ~~and~~information ~~Christine~~required ~~Guthrie,~~by Inthis ~~Her Capacity As Trustee, In The 382nd District Court of Rockwall County, Texas, Cause No~~Item. ~~1-18-1608.~~

~~This~~Item ~~is a case whereby the Company is attempting to collect on the Default Judgment obtained against Grisaffi~~7. ~~More~~Management’s ~~specifically~~Discussion ~~the~~and ~~Company~~Analysis isof ~~requesting~~Financial ~~the~~Condition ~~Court to order the La Dolce Vita Trust to turnover fraudulently transferred assets~~ and ~~for~~Results ~~additional~~of ~~relief necessary to enforce the Company’s judgment against Grisaffi.~~Operations

~~Chet – 5 Broadcasting, Inc. v Rocky Mountain High Brands, Inc., Supreme Court of the State of New Your, County of Ulster, Case No. 18~~Forward-~~4416.~~Looking Statements

~~The~~This ~~Plaintiff~~document ~~sued~~contains certain forward-looking statements as defined by federal securities laws. For this purpose, forward- looking statements are any statements contained herein that are not statements of historical fact and include, but are not limited to, those preceded by or that include the ~~Company~~words, “estimate,” ~~seeking~~“could,” ~~$21~~“should,~~000.00~~” in“would,” ~~damages~~“likely,” ~~for~~“may,” ~~breach~~“will,” of“plan,” “intend,” ~~contract~~“believes,” “expects,” “anticipates,” “projected,” or similar expressions. ~~The~~Those ~~Company~~statements isare ~~contesting~~subject ~~that~~to ~~claim~~known inand ~~its~~unknown ~~entirety~~risks, uncertainties and ~~has~~other ~~filed~~factors athat ~~counterclaim~~could cause actual results ~~against~~to ~~the~~differ ~~Plaintiff~~materially ~~for~~from anthose ~~unspecified~~contemplated ~~amount~~by ofsuch ~~damages~~statements. ~~This~~The ~~case~~forward-looking information is ~~new~~based on various factors and was ~~the~~derived ~~parties~~using ~~have~~numerous ~~not~~assumptions. ~~yet~~For ~~conducted~~these ~~any~~statements, ~~discovery~~we claim the protection of the “bespeaks caution” doctrine. Such forward-looking statements include, but are not limited to:

~~Item~~• 4.Statements ~~Mine~~regarding ~~Safety~~our ~~Disclosures~~anticipated financial and operating results, including increases in and anticipated sources of revenues;

~~Not~~• ~~applicable.~~Predictions regarding the outcome of pending legal proceedings and the impact on us of pending legal proceedings;

~~PART~~• IIStatements regarding anticipated changes in expenses;

~~Item 5.~~• ~~Unregistered~~Statements ~~Sales~~regarding ofour ~~Equity~~goals, ~~Securities~~intensions, plans and ~~Use~~expectations, ofincluding ~~Proceeds~~selling ~~Between~~and ~~November~~marketing 17plans generally, ~~2018~~the ~~and~~introduction ~~March~~of 30new products, ~~2019:~~and markets and locations we intend to target in the future

Date	Name	Shares Issued		Issue Price	Description	Exemption
11/29/2018	GHS Investments	10,000,000	$	0.005	Note Payable Conversion	Rule 506
12/4/2018	GHS Investments	14,561,852		0.005	Note Payable Conversion	Rule 506
12/13/2018	GHS Investments	33,116,385		0.007	Shares Sold	Rule 506
1/2/2019	John Kuhlke	508,062		0.008	Services Rendered	Section 4(2)
1/2/2019	GHS Investments	10,000,000		0.005	Note Payable Conversion	Rule 506
1/7/2019	GHS Investments	46,276,982		0.007	Shares Sold	Rule 506
1/25/2019	GHS Investments	10,000,000		0.005	Note Payable Conversion	Rule 506
2/4/2019	GHS Investments	15,000,000		0.005	Note Payable Conversion	Rule 506
2/5/2019	GHS Investments	25,247,856		0.007	Shares Sold	Rule 506
2/22/2019	GHS Investments	23,358,593		0.007	Shares Sold	Rule 506
3/7/2019	GHS Investments	30,606,307		0.006	Shares Sold	Rule 506
3/20/2019	GHS Investments	30,776,999		0.006	Shares Sold	Rule 506

•

Statements regarding expanded business opportunities in 2019;

13• Our expectation that we will sell securities on our balance sheet;

~~Table~~• Our expectation regarding repayment of ~~Contents~~loans;

~~Market Information~~• Expected uses of cash in 2019 and beyond; and

~~Our common~~• ~~stock~~Statements iswith ~~quoted~~respect onto ~~the~~having ~~OTCQB~~adequate tier of the OTC Markets Group quotation system (www.otcmarkets.com) under the trading ticker “RMHB.” The following tables set forth the range of high and low prices for our common stock for the two years ended December 31, 2018, as reported on the OTC Market Group’s quotation system. These quotations reflect inter-dealer prices, without retail markup, markdown, or commission and may not necessarily represent actual transactions.liquidity

Quarter Ended:	High Sale Price		Low Sale Price
March 31, 2017	$	0.15	$	0.04
June 30, 2017	$	0.10	$	0.07
September 30, 2017	$	0.07	$	0.02
December 31, 2017	$	0.03	$	0.01
March 31, 2018	$	0.01	$	0.03
June 30, 2018	$	0.01	$	0.02
September 30, 2018	$	0.01	$	0.01
December 31, 2018	$	0.01	$	0.01

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:

~~On April~~• ~~10,~~Negative ~~2019,~~changes ~~the~~in ~~last~~public ~~sales~~sentiment ~~price~~towards ~~per~~acceptance ~~share~~of the use of ~~our~~hemp- ~~common~~and ~~stock~~CBD-infused ~~was~~drinks ~~$0.0057.~~and other products;

~~Penny Stock~~• Other regulatory developments that could limit the market for our products;

~~The SEC~~• ~~has~~Our ~~adopted~~ability rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a market price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to ~~transactions~~successfully inintegrate ~~such securities~~acquired is provided by the exchange or system. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that: (a) contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary tradingentities; (b) contains a description of the broker's or dealer's duties to the customer and of the rights and remedies available to the customer with respect to a violation of such duties or other requirements of the securities laws; (c) contains a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread between the bid and ask price; (d) contains a toll-free telephone number for inquiries on disciplinary actions; (e) defines significant terms in the disclosure document or in the conduct of trading in penny stocks; and (f) contains such other information and is in such form, including language, type size and format, as the SEC shall require by rule or regulation.

~~The broker-dealer~~• ~~also~~Competitive ~~must provide~~developments, ~~prior~~including ~~to effecting any transaction in a penny stock,~~ the ~~customer~~possibility ~~with (a) bid and offer quotations for the penny stock; (b) the compensation~~ of ~~the~~new ~~broker-dealer~~entrants ~~and~~into ~~its~~our ~~salesperson~~primary ~~in the transaction~~markets; (c) the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and (d) a monthly account statement showing the market value of each penny stock held in the customer's account.

~~In addition,~~• ~~the~~The ~~penny~~loss stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written acknowledgment of ~~the~~key ~~receipt~~personnel; ~~of a risk disclosure statement, a written agreement as to transactions involving penny stocks,~~ and ~~a signed and dated copy of a written suitability statement.~~

~~These disclosure~~• ~~requirements~~Other ~~may~~risks ~~have~~discussed ~~the~~in ~~effect~~this ~~of reducing the trading activity for our common stock. Therefore, stockholders may have difficulty selling our securities.~~document

~~Dividends~~13

~~There are~~Table ~~no restrictions in our articles~~ of incorporation or bylaws that prevent us from declaring dividends. The Nevada Revised Statutes, however, do prohibit us from declaring dividends where after giving effect to the distribution of the dividend:Contents

~~1. we would not be able to pay our debts as they become due in the usual course of business, or;~~Overview

2. The Company generates revenue from finished ~~our~~product ~~total~~sales ~~assets~~to ~~would~~distributors be(resellers), ~~less~~private ~~than~~label ~~the~~customers, ~~sum~~retailers, ofand ~~our~~consumers. ~~total~~The ~~liabilities~~wholesale ~~plus~~market for the ~~amount~~Company’s ~~that~~products ~~would~~includes beall ~~needed~~retailers toin ~~satisfy~~the convenience and grocery store channels as well as certain specialty retail niche markets including health food, “smoke shop,” and novelty stores. Additionally, the ~~rights~~Company ofhas ~~shareholders~~an ~~who~~online ~~have~~retail ~~preferential~~presence via ~~rights~~our ~~superior~~Company towebsites ~~those~~and ~~receiving~~Amazon.com and via our Company websites. We custom manufacture beverages for private label customers that own their brand, but don’t have manufacturing capabilities or prefer to outsource the ~~distribution~~production of their products.

14Results of Operations

~~Table~~Year ofEnded ~~Contents~~December 31, 2019 Compared to the Year Ended December 31, 2018

~~We have~~Financial ~~not declared any dividends and we do not plan to declare any dividends in the foreseeable future.~~Summary

~~Securities~~The Company’s sales for the year ended ~~Authorized~~December 31, 2019 were $205,250 compared to $379,238 for ~~Issuance~~the ~~under~~year ~~Equity~~ended ~~Compensation~~December ~~Plans~~31, 2018.

~~On March 17, 2017, our Board of Directors approved the Rocky Mountain High Brands, Inc. 2017 Incentive Plan (the “2017 Incentive Plan”).~~ The ~~purpose~~Company’s ofnet ~~the~~loss ~~Incentive Plan is to provide a means~~ for the ~~Company~~year toended December ~~continue to attract~~31, ~~motivate~~2019 ~~and~~was ~~retain management~~$5, ~~key employees~~270,917 ~~consultants~~compared ~~and other independent contractors, and~~ to ~~provide~~a ~~these~~net ~~individuals~~loss ~~with greater incentive for their service to the Company by linking their interests in the Company’s success with those~~ of ~~the Company and its shareholders. The Plan provides that up to a maximum of 35~~$3,~~000~~355,~~000~~937 ~~shares of the Company’s common stock (subject to adjustment) are available~~ for ~~issuance under~~ the ~~Plan.~~year ~~The~~ended ~~Board~~December of31, ~~Directors awards these shares at its sole discretion~~2018.

Also on March 31, 2017, certain of our officers and directors returned a total of 25,041,732 shares of common stock to treasury for cancellation. On that same date, we granted to each of these officers and directors an equivalent number of restricted shares of common stock under our 2017 Incentive Plan. The restricted shares so granted may not be transferred, sold, or encumbered until six (6) months from the date of issue.Sales

OnFor the year ended December 31, 2019, sales ~~July~~were 14$205,250 ~~2017~~compared to $379,238 for the ~~Board~~year ended December 31, 2018, a decrease of ~~Directors~~$173,988 ~~increased~~or 46%. The sales decrease was driven by a reduction in HEMPd website sales due to the ~~authorized~~loss ~~shares~~of the Company’s merchant services provider and lower Eagle Spirit Water sales in 2019, partially offset by the ~~2017~~sales ~~Incentive~~from ~~Plan~~the first shipment of product to 65CBD Life,~~000~~ our Mexican private label customer. HEMPd website sales were negatively impacted by the loss of merchant services in the May 2019. A new merchant services provider that began processing in July 2019 proved to be unreliable so the Company made another change in October 2019. Additionally,~~000~~ the Company decided to no longer use its wellness products co-packer, which resulted in less available product to sell. The Company completed a production run of its previously out-of-stock Eagle Spirit Water in late August 2019. This was the first production run of Eagle Spirit Water in 2019. Lastly, the Company sold off the remaining inventory of its Rocky Mountain High branded hemp-infused energy drinks in the first half of 2019.

OnIn September 2019, the Company completed its ~~December~~initial 19production run and delivery of Green Lotus branded CBD-infused canned beverages for its private label customer, ~~2017~~Texas ~~the~~Wellness Center ~~Board~~(“TWC”), a subsidiary of ~~Directors~~GL ~~increased~~Brands, Inc. In late 2019, TWC informed the ~~authorized~~Company ~~shares~~that insome of the ~~2017~~cans ~~Incentive~~developed leaks ~~Plan~~and towere ~~100~~unsaleable. In May 2020,~~000,000~~ the Company agreed to a settlement and ~~issued~~release agreement whereby the Company agreed to ~~33,100,000~~issue ~~options~~common stock to ~~members~~TWC in exchange for mutual releases. The Company recorded this settlement in 2019 as a refund of the ~~Board~~sales price of $322,000 ~~management~~that ~~and~~had ~~employees~~been recorded as revenue in September 2019.

~~During~~ For the year ended December 31, ~~2017 the Board granted 31~~2019,~~000,000~~ ~~to two new members of the Board of Directors (Mr. Gerry David and~~sales ~~Mr.~~by ~~Kevin~~channel ~~Harrington),~~were ~~1,690,000~~70% ~~options to consultants~~online, ~~and~~13% 35distributor,~~100,000~~ ~~options~~10% toprivate ~~other members of the Board of Directors~~label, ~~officers~~ and ~~employees.~~7% ~~Messrs.~~retailer ~~David~~compared ~~and~~to ~~Harrington~~67% ~~resigned~~online, ~~from~~21% ~~the~~distributor, ~~Board of Directors in July 2017~~ and ~~joined the newly formed Advisory~~12% ~~Board~~retailer tofor the ~~Board~~year ofended ~~Directors~~December at31, ~~that time~~2018.

~~During the~~Cost ~~year ended December 31, 2018 the Board granted 13,312,458 options to members~~ of ~~the Advisory Board and 254,310 options to consultants.~~Sales

~~On January~~For the year ended December 31, 2019, 43cost of sales was $741,~~715,482~~136 ~~options~~or ~~were~~361% ~~forfeited~~of bysales, ~~former~~versus ~~members~~$410,818 or 108% of sales for the ~~Board~~year ended December 31, 2018, an increase of ~~Directors~~$330,318 or 80%. OnThe ~~February~~increase ~~28,~~in cost of sales primarily related to the production costs for the TWC production run in September 2019,. ~~851,286~~The ~~options~~related ~~were~~sale ~~forfeited~~was byrefunded ~~former~~as ~~consultants~~a result of the defective product, but the production costs were recognized in 2019.

~~Item 6. Selected Financial Data~~14

~~A smaller~~Table ~~reporting~~of ~~company is not required to provide the information required by this Item.~~Contents

~~Item~~In 2019 the Company recorded inventory obsolescence 7expense of $130,364 compared to $25,145 in 2018. ~~Management’s~~In ~~Discussion~~2019 the obsolescence related to expired or unusable finished goods, ingredients, and ~~Analysis~~packaging, primarily related to the FitWhey brand. In August 2019 management determined the Company would suspend the production of ~~Financial~~water-based ~~Condition~~protein and ~~Results~~caffeine-infused ofproducts, ~~Operations~~which had been produced under the FitWhey brand, until it develops a related hemp or CBD-infused product and/or brand. In 2018 the obsolescence expense related primarily to E-Juice and vape products that the Company no longer carries.

~~Forward-Looking Statements~~Operating Expenses

~~This document~~For ~~contains~~the ~~certain~~year ~~forward-looking~~ended ~~statements~~December as31, ~~defined by federal securities laws. For this purpose~~2019, ~~forward- looking~~operating ~~statements~~expenses ~~are~~were ~~any statements contained herein that are not statements of historical fact and include~~$3, ~~but are not limited to~~859, ~~those preceded by or that include the words~~354, ~~“estimate,”~~compared ~~“could,”~~to ~~“should~~$4,~~” “would~~523,~~” “likely,”~~108 ~~“may,”~~for ~~“will,”~~the ~~“plan,”~~year ~~“intend,”~~ended ~~“believes,” “expects,”~~December ~~“anticipates~~31,” ~~“projected~~2018,” ora ~~similar~~decrease ~~expressions.~~of ~~Those statements are subject to known and unknown risks~~$663,754 ~~uncertainties~~or ~~and other factors that could cause actual results to differ materially from those contemplated by such statements~~15%. ~~The~~Areas ~~forward-looking information is based on various factors and was derived using numerous assumptions. For~~in ~~these~~which ~~statements, we claim~~ the ~~protection~~Company ofexperienced ~~the~~significant ~~“bespeaks~~changes ~~caution”~~in ~~doctrine.~~operating ~~Such~~expenses ~~forward-looking statements include, but~~ are ~~not~~discussed ~~limited to:~~below.

•General ~~Statements regarding our anticipated financial~~ and ~~operating results, including increases in and anticipated sources of revenues;~~Administrative

•For ~~Predictions~~the ~~regarding~~year ~~the~~ended ~~outcome~~December 31, 2019, general and administrative expenses were $3,098,964 or 1510% of ~~pending~~sales ~~legal~~compared ~~proceedings~~to ~~and~~$3,689,175 or 973% of sales for the ~~impact~~year onended usDecember 31, 2018, a decrease of ~~pending~~$590,211 or 16%. The decrease in general and administrative expenses in 2019 was primarily driven by decreases in compensation, partially offset by increases in legal ~~proceedings;~~expenses and research and development costs.

•Advertising ~~Statements~~and ~~regarding anticipated changes in expenses;~~Marketing

•For ~~Statements~~the ~~regarding~~year ~~our~~ended ~~goals~~December 31, ~~intensions~~2019, ~~plans~~ advertising and ~~expectations~~marketing expenses were $642,324 ~~including~~or ~~selling~~313% ~~and~~of ~~marketing~~sales, ~~plans~~compared ~~generally~~to $833,933 ~~the~~or ~~introduction~~220% of ~~new~~sales ~~products~~for the year ended December 31, 2018, a decrease of $191,609 or 23%. The decrease in advertising and ~~markets~~marketing expenses in 2019 was a result of the Company’s reduction in online advertising and ~~locations~~marketing. weThis ~~intend~~was primarily the result of the loss of Company’s ability to ~~target~~sell inproduct on its HEMPd website after the ~~future~~loss of its merchant services provider. Also, private label customers are responsible for their own advertising so the Company does not bear those costs.

•Impairment ~~Statements regarding expanded business opportunities in 2019;~~Expense

•During ~~Our~~the ~~expectation~~year ~~that~~ended weDecember ~~will~~31, ~~sell~~2019, ~~securities~~impairment expense onwas ~~our~~$118,066. ~~balance~~There ~~sheet;~~was no impairment expense for the year ended December 31, 2018. The 2019 impairment expense was a result of management’s decision to suspend the production of water-based protein and caffeine-infused products, which had been produced under the FitWhey brand, until it develops a related hemp or CBD-infused product and/or brand. The Company impaired all software, formula, trademark, and goodwill assets related to FitWhey.

•Other ~~Our~~(Income) ~~expectation regarding repayment of loans;~~Expense

•Interest ~~Expected uses of cash in 2019 and beyond; and~~Expense

•For ~~Statements~~the ~~with~~year ~~respect~~ended December 31, 2019, interest expense was $877,740, compared to ~~having~~$1,275,693 ~~adequate~~for ~~liquidity~~the year ended December 31, 2018, a decrease of $397,953 or 31%. The decrease in interest expense, which includes the amortization of the discount on convertible debt, beneficial conversion features on convertible debt, and interest on newly issued convertible debt was due to decreased debt activity in 2019.

15Loss on Extinguishment of Debt

~~Table~~For the year ended December 31, 2019, the Company recorded a loss on extinguishment of ~~Contents~~debt of $172,910 related to the amendment and extinguishment of convertible notes payable. For the year ended December 31, 2018, the Company recorded a net loss on extinguishment of debt of $191,138 related to the extinguishment of convertible notes payable.

~~The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:~~15

•Table ~~Negative changes in public sentiment towards acceptance~~ of ~~the use of hemp- and CBD-infused drinks and other products;~~Contents

•Gain ~~Other~~on ~~regulatory~~Lawsuit ~~developments~~Judgment ~~that~~and ~~could~~Legal ~~limit the market for our products;~~Settlement

•During ~~Our~~the ~~ability~~year ended December 31, 2019 the Company recorded a net Gain on Lawsuit and Legal Settlement of $200,817. On May 30, 2019 the Company recorded a gain on lawsuit judgment and legal settlement of $230,840 related to ~~successfully~~the ~~integrate~~settlement ~~acquired~~of ~~entities;~~a lawsuit the Company filed in 2017 against several defendants. The settlement was reached on May 30, 2019 and included a $200,000 cash payment by the defendants to the Company, the forgiveness of debt of $30,840 owed by the Company to one of the defendants, and the return of 337,500 shares of common stock. In December 2019 the Company agreed to pay $30,023 to settle its lawsuit with LyonPride Music, LLC.

•During ~~Competitive~~the ~~developments~~year ended December 31, ~~including~~2018 the Company ~~possibility~~recorded a net Gain on Lawsuit and Legal Settlement of ~~new~~$689,724. ~~entrants~~In ~~into~~August 2018, the Company recorded a $654,289 gain related to the lawsuit judgment the Company received against Jerry Grisaffi, our ~~primary~~former ~~markets;~~Chairman of the Board. The Company de-recognized two notes payable to Mr. Grisaffi, plus accrued interest, in the amount of $418,865, and de-recognized the related derivative liability of $235,424. In September 2018, the Company executed a settlement with Statewide Beverage and recorded a gain on legal settlement of $34,435. As part of the settlement, the Company received 90,909 of its common shares that had previously been issued to the owners of Statewide Beverage and cancelled them. The Company also recorded the extinguishment of liabilities that had been recorded at the time of the sale of product to Statewide Beverage in 2016. In November 2018, the Company recorded a gain related to the lawsuit judgment the Company received against LSW in the amount of $1,000 related to a court order to void the Series A Preferred Stock initially issued to the Company’s former Chairman of the Board and later purchased by LSW. The $1,000 gain represents the par value of the 1,000,000 shares cancelled.

•Gain ~~The~~(Loss) ~~loss~~on ofChange ~~key~~in ~~personnel;~~Fair ~~and~~Value of Derivative Liability

•For ~~Other~~the ~~risks~~year ~~discussed~~ended December 31, 2019, the Company recorded a loss on the change in ~~this~~fair ~~document~~value of derivative liability of $25,844 compared to a gain of $1,975,858 for the year ended December 31, 2018. In 2019 the loss resulted from the impact of a decrease in the price of the Company’s common stock and its impact on convertible debt, while in 2018 the gain resulted from the decrease in the price of the Company’s underlying stock, which is used to calculate the fair value of the related derivative liability, from the beginning of the year to the end of the year.

~~Overview~~Income Taxes

~~The Company~~For ~~generates~~the ~~revenue~~years ~~from~~ended ~~finished~~December ~~product sales to distributors (resellers)~~31, ~~retailers~~2019 and ~~consumers. The wholesale market~~December ~~for~~31, 2018, the Company’s ~~products~~recorded ~~includes~~no ~~all~~income ~~retailers~~tax inprovision ~~the~~due ~~convenience~~to ~~and~~a ~~grocery~~full ~~store~~valuation ~~channels~~allowance asprovided ~~well~~on asdeferred ~~certain~~tax ~~specialty retail~~assets ~~niche markets including health food, “smoke shop,” and novelty stores. Additionally, the Company has an online~~resulting ~~retail~~from ~~presence~~net onoperating ~~Amazon~~losses.~~com and via our Company websites.~~

~~Results of~~Net ~~Operations~~Loss Attributable to Noncontrolling Interests

~~Year Ended~~For the year ended December 31, ~~2018~~2019 ~~Compared~~the toCompany incurred ~~the~~marketing ~~Year~~expenses ~~Ended~~of ~~December~~$8,398 31in its 51%-owned subsidiary, ~~2017~~Sweet Rock. The 49% allocated to noncontrolling interests was $4,123. There were no noncontrolling interests in 2018.

~~Financial Summary~~Liquidity and Capital Resources

~~The~~As of December 31, 2019, we had current ~~Company’s~~assets ~~sales~~of ~~for~~$499,003, ~~the~~consisting ~~year~~of ~~ended~~cash ~~December~~of 31$68,080, ~~2018~~accounts ~~were~~receivable (net) of $~~379~~18,~~238~~162, ~~compared~~inventory toof $~~141~~238,~~289~~035, ~~for~~and ~~the~~prepaid expenses ~~year~~and ~~ended~~other current assets of $174,726. As of December 31, 2019, we had current liabilities of $3,168,310, consisting ~~2017~~of accounts payable and accrued liabilities of $1,143,217, related party payables of $30,406, convertible notes payable (net) of $1,008,950, notes payable of $30,000, accrued interest of $96,134, deferred revenue of $445,925, and derivative liability of $413,678.

~~The Company’s net loss for the year ended December 31, 2018 was $3,355,937 compared to a net loss of $11,643,339 for the year ended December 31, 2017.~~16

~~Sales~~Table of Contents

~~For the~~Cash ~~year~~flows ~~ended~~from ~~December~~operating 31, 2018, sales were $379,238 compared to $141,289 for the year ended December 31, 2017, an increase of $237,949 or 168%. The sales increase was driven by the introduction of our new line of HEMPd products in March 2018, sales of FitWhey products, and increased sales of our high alkaline natural spring water. These sales increases were partially offset by the decrease in sales of our Rocky Mountain High branded hemp-infused energy drinks as the Company sold off remaining inventory in anticipation of the 2019 rebranding of these drinks. For the year ended December 31, 2018, sales by channel were 21% distributor, 12% retailer, and 67% online compared to the year ended December 31, 2017 during which sales by channel were 24% distributor, 15% retailer, and 61% online.activities

~~Cost~~Net cash used in operating activities during ofthe ~~Sales~~year ended December 31, 2019 was $3,267,564 compared to $3,728,782 during the year ended December 31, 2018. In both years, the Company used funds for advertising, promotions, storage, and administrative expenses.

~~For the~~Cash ~~year~~flows ~~ended~~from ~~December~~investing 31, 2018, cost of sales was $410,818 or 108% of sales, versus $297,487 or 211% of sales for the year ended December 31, 2017, an increase of $113,331 or 38%. In 2018 the Company recorded inventory obsolescence expense of $25,145 compared to $165,271 in 2017. In 2018 the obsolescence expense related primarily to E-Juice and vape products that the Company no longer carries. In 2017 the obsolescence expense was comprised of the write-down of the remaining hemp-infused beverage and shots inventory to reflect selling price reductions.activities

16Net cash provided by investing activities during the year ended December 31, 2019 was $6,667 compared to net cash used in investing activities of $33,915 during the year ended December 31, 2018. In 2019 the cash provided was due to the disposal of a company van. In 2018 the cash used was due to software expenditures for the Company’s new HEMPd.com website. Property and equipment purchased in 2018 consisted of office and computer equipment.

~~Table~~Cash offlows ~~Contents~~from financing activities

~~Operating~~Net cash provided by financing activities during ~~Expenses~~the year ended December 31, 2019 was $2,715,291 compared to $4,359,400 during the year ended December 31, 2018. In 2019, proceeds of $367,500 were from the issuance of convertible notes payable compared to $877,500 in 2018. In 2019 the Company repaid $7,493 of notes payable compared to $14,672 in 2018. In 2019 the Company received proceeds of $100,000 from the sale of the newly designated Series F Preferred Stock. In the years ended December 31, 2019 and 2018, the Company received proceeds from sales of common stock of $2,255,284 and $3,669,504, respectively.

~~For the~~Material year ended December 31, 2018, operating expenses were $4,523,108, compared to $7,407,789 for the year ended December 31, 2017, a decrease of $2,884,681 or 38%. Areas in which the Company experienced significant changes in operating expenses are discussed below.Indebtedness

~~General~~As of December 31, 2019 and 2018, the Company’s outstanding debt, net of discounts, totaled $1,038,950 and ~~Administrative~~$704,089, respectively. The increase in debt during the year ended December 31, 2019 resulted from the modification of notes payable.

~~For the~~As ~~year~~of ~~ended~~ December 31, ~~2018~~2019, ~~general~~convertible ~~and~~promissory notes ~~administrative~~payable ~~expenses~~ were ~~$3,689,175~~convertible ~~or 973% of sales, compared to $6,465,861 or 4576% of sales~~ for ~~the~~common ~~year~~stock ~~ended~~at ~~December~~fixed ~~31,~~prices ~~2017,~~ranging afrom ~~decrease~~$.02 ofto $~~2,776,686~~.03 or ~~42%.~~at ~~The~~a ~~decrease~~discount into ~~general~~market ~~and~~price, ~~administrative~~as ~~expenses~~defined, ~~in 2018 was driven by decreases in compensation expense to former members~~ of ~~the Board of Directors and bad debt expense, partially offset by increases in legal expenses~~50%.

~~Advertising~~As of December 31, 2018, convertible promissory ~~and~~notes ~~Marketing~~payable were convertible for common stock at fixed prices ranging from $.10 to $.16 or at a discount to market price, as defined, of 50%.

~~For the~~The ~~year~~Company ~~ended~~has ~~December~~determined ~~31,~~that ~~2018,~~the ~~advertising~~conversion feature ~~and~~embedded ~~marketing~~in ~~expenses~~the ~~were~~notes ~~$833,933~~referred ~~or 220% of sales, compared~~ to ~~$882~~above,~~765~~ orthat ~~625% of~~contain ~~sales~~a ~~for~~potential ~~the~~variable ~~year~~conversion ~~ended December 31~~amount, ~~2017,~~constitutes a ~~decrease~~derivative which ofhas ~~$48,832~~been orbifurcated ~~6%.~~from ~~The~~the ~~decrease~~note inand ~~advertising~~recorded ~~and~~as ~~marketing~~a ~~expenses in~~derivative ~~2018~~liability, ~~was~~with a ~~result~~corresponding ofdiscount ~~management’s~~recorded ~~decision~~ to ~~decrease advertising and marketing expenditures on~~ the ~~Company’s~~associated ~~hemp-infused~~debt. ~~beverages~~The ~~and~~excess ~~energy shots, partially offset by an increase in costs related to the launch~~ of the ~~new~~derivative ~~HEMPd~~value ~~products and~~over ~~advertising for~~ the ~~newly-acquired~~face ~~FitWhey~~amount ~~brand.~~of ~~Additionally, in 2017~~ the ~~Company~~note ~~executed~~is arecorded ~~large~~immediately ~~marketing contract with a third-party promoter and issued stock~~ to ainterest ~~distributor~~expense inat ~~exchange for promotional activity~~inception.

~~Impairment Expense~~Future Liquidity Requirements

During the year ~~ended~~ending December 31, ~~2017~~2020, the Company ~~recorded~~expects anto ~~impairment~~have ~~expense~~positive cash flows from operations. Depending on timing of ~~$59,163~~cash ~~related~~flows tofrom ~~its~~the ~~investment~~manufacturing facility acquired in ~~Rocky~~April ~~Mountain High~~2020, ~~Water~~the Company. ~~This~~will ~~represented~~need adebt ~~100%~~or ~~impairment~~equity onfinancing, ~~this~~particularly ~~investment~~for equipment and short-term operational needs. We ~~There~~expect ~~was~~any nooperational ~~impairment~~cash ~~recorded~~needs inwill ~~2018~~be met by our current funding arrangements with GHS Investments, LLC or other sources.

~~Other (Income)~~Off-Balance ~~Expense~~Sheet Arrangements

~~Interest~~As of December 31, 2019, there were no off-balance ~~Expense~~sheet arrangements

~~For the~~Going year ended December 31, 2018, interest expense was $1,275,693, compared to $2,700,221 for the year ended December 31, 2017, a decrease of $1,424,528 or 53%. The decrease in interest expense, which includes the amortization of the discount on convertible debt, beneficial conversion features on convertible debt, interest on Series C Preferred Stock, and interest on newly issued convertible debt was due to decreased debt activity in 2018.Concern

~~Gain~~The accompanying financial statements have ~~(Loss)~~been prepared on ~~Extinguishment~~a going concern basis, which contemplates the realization of ~~Debt~~assets and the satisfaction of liabilities in the normal course of business. The Company has a total shareholders’ deficit of $2,662,351 and an accumulated deficit of $40,285,145 as of December 31, 2019 and has generated operating losses since inception. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to generate revenues and its ability to continue raising capital.

For the year ended December 31, 2018, the Company recorded a net loss on extinguishment of debt of $191,138 related to the settlement of convertible debt. During the year ended December 31, 2017, the Company recorded a net gain on extinguishment of debt of $1,200,092 related to the settlement of convertible debt.17

~~Gain on~~Table ~~Change in Redemption Value~~ of ~~Series C Preferred Stock~~Contents

~~For~~During 2019 the Company funded its operations with sales of equity and debt securities. The COVID-19 pandemic of 2020 has added uncertainty into the financial ~~year~~markets ~~ended~~that ~~December~~the 31Company relies on for its operating and investment funding. It is unclear how long, ~~2017~~or to what extent, the pandemic will impact the Company ~~recorded~~in a2020 ~~gain~~and ofbeyond. ~~$834~~On April 30,~~242~~ on2020 the ~~change~~Company inpurchased ~~redemption~~certain ~~value~~assets of Raw ~~Series~~Pharma, CLLC ~~Preferred Stock~~(“Raw ~~related~~Pharma”) and agreed to ~~the~~sublease ~~valuation~~Raw ofPharma’s ~~these~~production ~~shares~~facility. Management ~~There~~believes ~~was~~its noSecurities ~~change~~Purchase inAgreement ~~redemption~~dated ~~value~~December in20, ~~2018~~2019 aswith ~~the~~GHS ~~Series~~Investments, CLLC ~~Preferred Stock~~(“GHS”), ~~was~~along ~~cancelled~~with inbridge ~~October~~financing ~~2017~~from asGHS ~~part~~or ofother asources, ~~legal~~will ~~settlement~~provide ~~with~~sufficient ~~the~~funds ~~holder~~to make up for any operating cash flows.

~~Gain~~The Company’s business has been adversely affected by the instability, disruption, and quarantine restrictions caused by the recent COVID-19 pandemic. The COVID-19 pandemic may cause customers to suspend their decisions on ~~Lawsuit~~ordering ~~Judgment~~our products, make it impossible to attend or sponsor trade shows or other conferences in which our products are presented to distributors, customers and ~~Legal~~potential customers, ~~Settlement~~for our customers to visit our physical location, and give rise to sudden significant changes in regional and global economic conditions and cycles that could interfere with purchases of goods, or commitments to develop new brands and private label products.

~~For the~~Significant ~~year~~disruptions ~~ended~~to communications ~~December~~and 31travel, ~~2018,~~including ~~the~~travel ~~Company~~restrictions ~~recorded~~and aother ~~$654,289~~protective ~~gain~~quarantine onmeasures ~~a lawsuit judgment~~ against ~~the~~COVID-19 by ~~Company’s~~governmental ~~former~~agencies, ~~Chairman~~have ofincreased the ~~Board,~~difficulty ain ~~$34,435~~delivering ~~gain~~goods ~~related~~ to ~~the~~our ~~settlement~~customers ofand acould ~~lawsuit~~ultimately ~~with~~make ~~Statewide Beverage,~~such ~~and~~deliveries aimpossible. ~~gain~~Travel onrestrictions aand ~~judgment~~protective measures against ~~the~~COVID-19 ~~holder~~could ofcause ~~our~~us ~~Series~~to Aincur ~~Preferred~~additional ~~Stock~~unexpected oflabor costs ~~$1,000,~~and ~~which~~expenses ~~represented~~or ~~the~~could ~~par~~restrain ~~value of~~our ~~the~~ability ~~1,000,000~~to ~~shares.~~retain ~~There~~the ~~were~~highly noskilled ~~such~~personnel ~~gains~~we inneed ~~2017~~for our operations.

17The COVID-19 pandemic has added uncertainty to the financial markets that the Company relies on for its operating and investment funding. It has also negatively impacted the Company’s ability to meet its external financial reporting deadlines.

~~Table~~Critical ofAccounting ~~Contents~~Policies

~~Gain~~A Critical Accounting Policy is one which is ~~(Loss)~~both onimportant ~~Change~~to inthe ~~Fair~~portrayal ~~Value~~of a company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments, often as a result of ~~Derivative~~the ~~Liability~~need to make estimates about the effect of matters that are inherently uncertain.

~~For the~~The ~~year~~Company’s ~~ended~~business ~~December~~may ~~31,~~be ~~2018,~~adversely affected by the ~~Company~~instability, ~~recorded~~disruption, aand ~~gain~~quarantine onrestrictions ~~the~~caused ~~change~~by inthe ~~fair~~recent ~~value~~COVID-19 ofpandemic. ~~derivative~~The ~~liability~~COVID-19 ~~of $1,975,858~~pandemic ~~compared~~may tocause acustomers ~~loss~~to ofsuspend ~~$3,413,465~~their ~~for~~decisions ~~the~~on ~~year~~ordering ~~ended~~our ~~December 31~~products, ~~2017.~~make Init ~~2018~~impossible ~~the~~to ~~gain~~attend ~~resulted~~or ~~from~~sponsor ~~the~~trade ~~decrease~~shows ~~in the price~~or ofother ~~the~~conferences ~~Company’s~~in ~~underlying~~which ~~stock,~~our ~~which~~products isare ~~used~~presented to ~~calculate~~distributors, ~~the~~customers ~~fair~~and ~~value~~potential ofcustomers, ~~the~~for ~~related~~our ~~derivative~~customers ~~liability,~~to visit ~~from~~our ~~the beginning~~physical oflocation, ~~the~~and ~~nine-month~~give ~~period~~rise to ~~the~~sudden ~~end~~significant ofchanges ~~the~~in ~~period~~regional and aglobal ~~decrease~~economic inconditions ~~the~~and ~~balance of variable rate convertible notes payable.~~cycles Inthat ~~2017~~could ~~the~~interfere ~~gain~~with ~~resulted~~purchases ~~from~~of angoods, ~~increase~~or incommitments ~~the~~to ~~risk-free~~develop ~~interest~~new ~~rate~~brands and ~~the~~private ~~Company’s~~label ~~stock volatility factors that are inputs in the derivative liability calculation~~products.

~~Income~~Any significant disruption to communications ~~Taxes~~and travel, including travel restrictions and other potential protective quarantine measures against COVID-19 by governmental agencies, may increase the difficulty and could make it impossible for us to deliver goods to our customers. Travel restrictions and protective measures against COVID-19 could cause us to incur additional unexpected labor costs and expenses or could restrain our ability to retain the highly skilled personnel we need for our operations.

~~For the~~The ~~years~~COVID-19 ~~ended~~pandemic ~~December~~has ~~31,~~added ~~2018~~uncertainty to ~~and~~the ~~December~~financial ~~31,~~markets ~~2017,~~that the Company ~~recorded~~relies noon ~~income~~for ~~tax~~its ~~provision~~operating ~~due~~and toinvestment afunding. ~~full~~It ~~valuation allowance~~has ~~provided~~also onnegatively ~~deferred~~impacted ~~tax~~the Company’s ~~assets~~ability ~~resulting~~to ~~from~~meet ~~net~~its ~~operating~~external ~~losses~~financial reporting deadlines.

~~Six Months~~The ~~Ended~~extent ~~December~~to 31which COVID-19 impacts our business, sales ~~2017~~and ~~Compared~~results toof ~~Six~~operations ~~Months~~will ~~Ended~~depend ~~December~~on 31future developments, ~~2016~~which are highly uncertain and cannot be predicted.

~~Financial Summary~~Use of Estimates

The preparation of the financial statements ~~Company’s~~in ~~sales~~conformity ~~for~~with Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the ~~six~~reported ~~months~~amounts ~~ended~~of ~~December~~assets ~~31,~~and ~~2017~~liabilities ~~were~~and ~~$59~~disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Certain of the Company’s estimates could be affected by external conditions,~~653~~ ~~compared~~including those unique to ~~$320~~its industry,~~338~~ ~~for~~and general economic conditions. It is possible that these external factors could have an effect on the ~~six~~Company’s estimates ~~months~~that ~~ended~~could ~~December~~cause actual results to differ from its estimates. The Company re-evaluates all of its accounting estimates ~~31,~~at ~~2016~~least quarterly based on these conditions and record adjustments when necessary.

~~The Company’s~~Revenue ~~net loss for the six months ended December 31, 2017 was $5,507,781 compared to a net loss of $3,140,693 for the six months ended December 31, 2016.~~Recognition

~~Sales~~The Company follows the guidance of the Accounting Standards Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers,” as amended. We record revenue when persuasive evidence of an arrangement exists, product delivery has occurred, the selling price to the customer is fixed or determinable and collectability of the revenue is reasonably assured. The Company has not experienced any significant returns from customers and accordingly, in management’s opinion, no reserve for returns has been provided. Payments received prior to shipment of goods are recorded as deferred revenue.

~~For the~~Fair ~~six~~Value months ended December 31, 2017, sales were $59,653 compared to $320,338 for the six months ended December 31, 2016, a decrease of $260,685 or 81%. The sales decrease was driven primarily by the lack of funding for inventory production, direct sales support, and advertising and promotion of the Company’s products. Also, in 2017 the Company has reduced prices on its existing drinks and shots inventory in order to clear out existing inventory and prepare for the launch of its new HEMPd product line. The prior year sales amount included a large sale to a distributor. In the six months ended December 31, 2017 sales consisted of approximately 68% online sales, 22% retailer sales, and 10% distributor sales, compared to 97% distributor sales and 3% online sales for the six months ended December 31, 2016.Measurements

~~Cost~~The Company adopted the provisions of ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of ~~Sales~~fair value measurements.

~~For the~~The ~~six~~estimated ~~months~~fair ~~ended~~value ~~December~~of ~~31,~~certain ~~2017~~financial instruments, ~~cost~~including ofcash ~~sales~~and ~~was~~cash ~~$173~~equivalents,~~043~~ oraccounts ~~290% of sales~~receivable, ~~versus~~accounts ~~$127,476~~payable orand ~~40%~~accrued ofexpenses ~~sales~~are ~~for~~carried ~~the~~at ~~six~~historical ~~months~~cost ~~ended December 31~~basis, ~~2016,~~which anapproximates ~~increase~~their offair ~~$45,567~~values orbecause ~~36%.~~of Inthe ~~2017~~short-term ~~the~~nature ~~Company~~of ~~recorded~~these ~~inventory~~instruments. ~~obsolescence~~The ~~expense~~carrying amounts of ~~$93,110~~our ~~compared~~short toand ~~$28,837~~long-term incredit ~~2016,~~obligations ~~resulting~~approximate infair avalue ~~high~~because ~~cost~~the ofeffective ~~sales~~yields ~~percentage.~~on Inthese ~~2017~~obligations, ~~the~~which ~~obsolescence expense was comprised~~include ofcontractual ~~the~~interest ~~write-down~~rates oftaken ~~the~~together ~~remaining~~with ~~hemp-infused~~other ~~beverage~~features ~~and~~such ~~shots~~as ~~inventory~~concurrent toissuances ~~reflect~~of ~~selling price~~warrants ~~reductions.~~and/or Inembedded ~~2016~~conversion options, ~~the~~are ~~obsolescence~~comparable ~~expense~~to ~~was~~rates ~~due~~of toreturns ~~the~~for ~~write-off~~instruments of ~~the~~similar ~~Company’s~~credit ~~expired brownie inventory~~risk.

~~Operating~~ASC 820 defines fair value as the exchange ~~Expenses~~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, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:

~~For the~~• ~~six~~Level ~~months~~1 ~~ended~~— ~~December~~quoted ~~31,~~prices ~~2017,~~in ~~operating~~active ~~expenses~~markets ~~were $2,744,840 or 4,214% of sales, compared to $2,602,148 or 812% of sales~~ for ~~the~~identical ~~six~~assets ~~months ended December 31, 2016, an increase of $142,692~~ or 6%liabilities. ~~Areas in which the Company experienced significant changes in operating expenses are discussed below.~~

~~General~~ • Level 2 — quoted prices for similar assets and ~~Administrative~~liabilities in active markets or inputs that are observable.

~~For the~~• ~~six~~Level ~~months~~3 ~~ended~~— ~~December~~inputs ~~31,~~that ~~2017,~~are ~~general~~unobservable ~~and administrative expenses were $2,567,486 or 4,304% of sales, compared to $1,853,089 or 579% of sales~~ (for ~~the~~example ~~six~~cash ~~months~~flow ~~ended~~modeling ~~December~~inputs ~~31,~~based ~~2016, an increase of $714,396 or 39%. The increase in general and administrative expenses in 2017 was driven by fees and penalties paid~~ on ~~convertible debt~~assumptions).

18The derivative liability, which relates to the conversion feature of convertible debt and common stock warrants and options, is classified as a Level 3 liability, and is the only financial liability measure at fair value on a recurring basis.

~~Table of Contents~~18

~~Advertising and~~Table ~~Marketing~~of Contents

For the six months ended December 31, 2017, advertising and marketing expenses were $118,191 or 198% of sales, compared to $749,059 or 234% of sales for the six months ended December 31, 2016, a decrease of $630,868 or 84%. The ~~decrease~~change in ~~advertising and marketing expenses in 2017 was driven by~~ the ~~lack~~Level of3 ~~funding~~financial ~~for advertising and promotional expenditures and the decreased need to advertise~~instruments ~~and~~is ~~promote~~as ~~the Company’s existing products in anticipation of the launch of the new product line.~~follows:

Impairment Expense

Balance, January 1, 2018	$	5,609,389
Issued		—
Exercises/Conversions		(3,257,359)
Change in fair value recognized in operations		(1,975,858)
Balance, December 31, 2018	$	376,172
Issued		21,193
Exercises/Conversions/Expirations		(9,531)
Change in fair value recognized in operations		25,844
Balance, December 31, 2019	$	413,678

~~During the~~ The ~~six~~estimated ~~months~~fair ~~ended~~value of ~~December~~the ~~31,~~derivative ~~2017,~~instruments ~~the~~was ~~Company~~valued ~~recorded~~using anthe ~~impairment~~Black-Scholes ~~expense~~option ofpricing ~~$59~~model,~~163~~ ~~related~~using tothe ~~its~~following ~~investment~~assumptions inas ~~Rocky Mountain~~of ~~High Water Company. This represented a 100% impairment on this investment. There was no impairment recorded during the~~December ~~six~~31, ~~months~~2019 ~~ended~~and December 31, ~~2016.~~2018:

Other (Income) Expense

	December 31, 2019			December 31, 2018
Estimated dividends		None			None
Expected volatility		137	%		106%
Risk free interest rate		1.47	%		2.41%
Expected term		.1 to 3.25 years			1 to 4.0 years

~~Interest Expense~~Convertible Instruments

~~For~~The Company evaluates and accounts for conversion ~~the~~options ~~six~~embedded ~~months~~in ~~ended~~convertible ~~December~~instruments ~~31,~~in ~~2017,~~accordance ~~interest~~with ~~expense~~ASC ~~was~~815 ~~$2,054,438,~~“Derivatives ~~compared~~and Hedging Activities.” Applicable GAAP requires companies to ~~$398,648~~bifurcate ~~for~~conversion ~~the~~options ~~six~~from ~~months~~their ~~ended~~host ~~December 31,~~instruments ~~2016,~~and anaccount ~~increase~~for ofthem ~~$1,655,790~~as orfreestanding ~~415%~~derivative financial instruments according to certain criteria. The ~~increase~~criteria ininclude ~~interest~~circumstances ~~expense,~~in which ~~includes~~(a) the ~~amortization~~economic characteristics and risks of the ~~discount on~~embedded ~~convertible~~derivative ~~debt,~~instrument ~~beneficial~~are ~~conversion~~not ~~features~~clearly onand ~~convertible~~closely ~~debt,~~related ~~interest~~to onthe ~~Series~~economic Ccharacteristics ~~Preferred~~and ~~Stock~~risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and ~~interest~~the onhost contract is not ~~newly~~re-measured ~~issued~~at ~~convertible~~fair ~~debt~~value ~~was~~under ~~due~~other toGAAP ~~increased~~with ~~debt~~changes ~~activity~~in fair value reported in ~~2017~~earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.

~~Gain on~~Recently ~~Extinguishment~~Issued ofAccounting ~~Debt~~Pronouncements

~~For the~~Unless ~~six~~otherwise ~~months~~noted, ~~ended~~we ~~December~~have ~~31,~~elected ~~2017,~~to use the ~~Company~~extended ~~recorded~~transition aperiod ~~gain~~for ofcomplying ~~$1,200,092~~with onnew ~~the~~or ~~extinguishment~~revised accounting standards under Section 102(b)(1) of ~~debt.~~the ~~The~~JOBS ~~gain~~Act. ~~was~~This aallows ~~result~~us ofto delay the ~~amendment~~adoption of ~~two~~new ~~convertible~~or ~~notes~~revised ~~into~~accounting ~~non-convertible~~standards ~~notes.~~that ~~There~~have ~~was~~different noeffective ~~change~~dates ~~gain~~for orpublic ~~loss~~and private oncompanies ~~the extinguishment~~until ofthose ~~debt~~standards ~~during~~apply ~~the~~to ~~six~~private ~~months~~companies. ~~ended~~As ~~December~~a 31result of our election, ~~2016~~our financial statements may not be comparable with other public companies.

~~Loss~~In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842), which requires lessees to recognize on ~~Change~~the inbalance ~~Fair~~sheet ~~Value~~a right-of-use ~~Derivative~~asset, ~~Liability~~representing their right to use the underlying asset for the lease term, and a lease liability for all leases with terms greater than 12 months. The guidance also requires qualitative and quantitative disclosures designed to assess the amount, timing and uncertainty of cash flows arising from leases. The Company adopted Topic 842, as amended, on January 1, 2020. Upon adoption, the Company did not have any leases that would require recognition on the its consolidated balance sheet.

~~For the~~In ~~six~~June ~~months ended December 31~~2016, ~~2017,~~ the ~~Company~~FASB ~~recorded~~issued aASU ~~loss on the change in fair value of derivative liability of $1~~2016-13,~~795,205~~ ~~compared~~Financial toInstruments-Credit aLosses ~~loss~~(Topic ~~of $332~~326),~~759~~ ~~during~~which ~~the~~requires ~~six months ended December 31, 2016. In 2017~~ the ~~loss~~immediate ~~resulted~~recognition ~~from~~of ~~the~~management’s ~~increase in convertible~~estimates ~~debt and the related increase in the value~~ of ~~the~~current ~~conversion~~and ~~features,~~expected ~~partially~~credit ~~offset~~losses. byASU ~~the~~2016-13 ~~decrease~~is ineffective ~~the~~for ~~price of~~ the Company~~’s underlying~~ ~~stock,~~beginning ~~which~~January ~~is used to calculate the fair value of the related derivative liability, over the period from July~~ 1, ~~2017~~ ~~to December 31, 2017~~2021. The ~~smaller~~Company ~~loss~~is incurrently evaluating ~~2016 resulted from~~ the ~~relative~~potential ~~stability~~impact of ~~the~~adopting ~~price~~this ofguidance ~~the~~on ~~Company’s~~its ~~common stock~~financial ~~between July 1, 2016 and December 31, 2017~~statements.

~~Income Taxes~~19

~~For the~~Table ~~six~~of ~~months ended December 31, 2017 and 2016, the Company recorded no income tax benefit due to a full valuation allowance provided on deferred tax assets resulting from net operating losses.~~Contents

~~Liquidity~~In May 2018, the FASB issued ASU 2018-09, Compensation-Stock ~~and~~Compensation: ~~Capital~~Scope ~~Resources~~of Modification Accounting. This ASU amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards an entity is required to apply modification accounting under ASC 718. This update is effective for the Company beginning January 1, 2021. The Company is currently evaluating the impact that ASU 2018-09 will have on its consolidated financial statements.

~~As of~~In ~~December~~June ~~31,~~ 2018, wethe ~~had~~FASB ~~current~~issued ~~assets~~ASU ~~of $1~~2018-07,~~165,806,~~ Compensation-Stock ~~consisting~~Compensation ~~of cash of $613,686, accounts receivable~~ (~~net~~Topic 718): ofImprovements ~~$17,324, inventory~~to ofNonemployee ~~$146,722,~~Share-Based ~~and~~Payment ~~prepaid~~Accounting. ~~expenses~~The ~~and~~guidance ~~other~~is intended ~~current~~to ~~assets~~reduce ofthe ~~$388,074.~~complexity Asassociated ofwith ~~December~~issuers’ ~~31,~~accounting ~~2018,~~for weshare-based ~~had~~payment ~~current~~transactions ~~liabilities~~for acquiring ofgoods ~~$2,077,533, consisting of accounts payable~~ and ~~accrued~~services. ~~liabilities~~The ofASU ~~$505,214,~~is ~~convertible~~effective ~~notes~~for ~~payable~~the ~~(net)~~Company ofbeginning ~~$666~~January 1,~~596, other~~ ~~notes~~2022. ~~payable~~The ofCompany ~~$37,493,~~is ~~accrued~~currently ~~interest~~evaluating ofthe ~~$25,758,~~impact that ~~deferred~~ASU ~~revenue~~2018-07 ofwill ~~$466,300,~~have ~~and~~on ~~derivative~~its ~~liability~~consolidated offinancial ~~$376,172~~statements.

~~Cash~~In July 2018, the FASB issued ASU 2018-11, ~~flows~~Earnings Per Share (Topic 260); Distinguishing Liabilities from ~~operating~~Equity ~~activities~~(Topic 480): Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The guidance is intended to reduce the complexity associated with issuers’ accounting for certain financial instruments with characteristics of liabilities and equity. Specifically, a down round feature (as defined) would no longer cause a freestanding equity-linked financial instrument (or an embedded conversion option) to be accounted for as a derivative liability at fair value with changes in fair value recognized in current earnings. The amendments in this ASU are effective for the Company beginning January 1, 2020. Management does not believe that ASU 2018-11 will have a material impact on its consolidated financial statements.

~~Net~~In August 2018, the FASB issued ASU ~~cash~~2018-13, ~~used~~Fair inValue ~~operating~~Measurements: ~~activities~~Disclosure ~~during~~Framework Changes to the ~~year~~Disclosure ~~ended~~Requirements ~~December~~for ~~31,~~Fair ~~2018~~Value ~~was~~Measurement. This ~~$3,728,782~~update ~~compared~~modifies tothe ~~$1,949,322~~disclosure ~~during~~requirements on fair value measurements in Topic 820. The ASU is effective for the ~~year~~Company ~~ended~~beginning ~~December~~January 311, ~~2017~~2021. InThe ~~both~~Company ~~years,~~is currently evaluating the ~~Company~~impact ~~used~~that ~~funds~~ASU ~~for~~2018-13 ~~advertising,~~will ~~promotions,~~have ~~storage,~~on ~~and~~its ~~administrative~~consolidated financial ~~expenses~~statements.

19Item 7A. Quantitative and Qualitative Disclosures About Market Risk

~~Table~~A ofsmaller ~~Contents~~reporting company is not required to provide the information required by this Item.

~~Cash~~Item ~~flows~~8. ~~from~~Financial ~~investing~~Statements ~~activities~~and Supplementary Data

~~Net~~Index ~~cash used in investing activities during the year ended December 31, 2018 was $33,915 compared~~ to ~~$14,125~~Financial ~~during~~Statements ~~the~~Required ~~year~~by ~~ended December~~Article ~~31,~~8 ~~2017. In 2018 the increase consisted~~ of ~~software~~Regulation ~~expenditures for the Company’s new HEMPd.com website. Property and equipment purchases in both years consisted of office and computer equipment.~~S-X:

~~Cash~~Audited ~~flows~~Financial ~~from financing activities~~Statements:

Net cash provided by financing activities during the year ended December 31, 2018 was $4,359,400 compared to $1,825,369 during the year ended December 31, 2017. In 2018, proceeds of $877,500 were from the issuance of convertible notes payable compared to $590,000 in 2017. In 2018 the Company repaid $172,932 of convertible notes. In 2017 the Company received proceeds of $289,000 and $440,000 from the issuance of related party convertible notes and notes payable, respectively. In 2018, the Company repaid notes payable of $14,672. In 2017, the Company repaid related party convertible notes of $25,000 and notes payable of $11,831. In the years ended December 31, 2018 and 2017, the Company received proceeds from sales of common stock of $3,669,504 and $543,200, respectively.

F-1		Report of Prager Metis, CPAs, LLC, Independent Registered Public Accounting Firm
F-2		Consolidated Balance Sheets as of December 31, 2019 and December 31, 2018
F-3		Consolidated Statements of Operations for the years ended December 31, 2019 and December 31, 2018
F-4		Consolidated Statements of Shareholder’s Deficit for the years ended December 31, 2019 and December 31, 2018
F-5		Consolidated Statements of Cash Flows for the years ended December 31, 2019 and December 31, 2018
F-6		Notes to Consolidated Financial Statements.

~~Material Indebtedness~~20

~~As of~~Table ~~December 31, 2018 and 2017, the Company’s outstanding debt, net~~ of discounts, totaled $704,089 and $1,402,090, respectively. The decrease in debt during the year ended December 31, 2018 resulted from the conversion of notes payable to common stock, the repayment of debt, and the extinguishment of debt based on a court ruling in a lawsuit against our former Chairman of the Board.Contents

~~During~~REPORT ~~2017~~OF ~~our~~INDEPENDENT ~~operations~~REGISTERED ~~were~~PUBLIC ~~funded~~ACCOUNTING primarily through the issuance of convertible promissory notes, which were convertible to common stock at fixed prices or at a specified percentage discount off market prices. On October 12, 2017, the Company executed an Equity Financing Agreement (“EFA”) with GHS Investments, LLC (“GHS”). Under the agreement, GHS committed to purchase up $12 million of the Company’s common stock over a 24-month period at a 20% discount off the market price, as defined in the agreement. The agreement contained certain restrictions on the timing of the stock purchases and required the Company to file a registration statement with the Securities and Exchange Commission (“SEC”) to register the common shares issuable under the agreement. The Company filed the registration statement on Form S-1 with the SEC on November 1, 2017. Between November 1, 2017 and the date of the effectiveness of the Form S-1, the Company entered into convertible promissory notes payable with GHS totaling $1,087,490. As of December 31, 2018, the majority of these notes had been repaid or converted for common stock and the remaining principal balance was $212,329.FIRM

OnTo ~~June 27, 2018,~~ the ~~Company~~Board ~~entered into a Securities Purchase Agreement (“SPA”) with GHS, which provides for GHS to purchase up to $15,000,000~~ of ~~the~~Directors Company’s common stock over a 24-month period based on a contractually agreed upon market discount. The SPA replaces the EFA the Company entered into with GHS on October 12, 2017. On August 8, 2018, the Company filed a registration statement on Form S-1 with the Securities and ~~Exchange~~Stockholders ~~Commission (“SEC”) to register up to 320,000,000 shares~~ of our common stock to be purchased by GHS under the SPA. The registration statement became effective on October 10, 2018. Between August 8, 2018 and the effectiveness of the Form S-1 on October 10, 2018 the Company entered into convertible promissory notes payable totaling $658,750. As of December 31, 2018, the principal balance of these notes was $658,750.

AsRocky ofMountain ~~December~~High 31Brands, ~~2018, convertible promissory notes payable were convertible for common stock at fixed prices ranging from $~~Inc.~~005 to $.008 or at a discount to market price, as defined, of 50%.~~

~~The~~Opinion ~~Company~~on ~~has determined that~~ the ~~conversion~~Consolidated ~~feature~~Financial ~~embedded~~Statements in the notes referred to above, that contain a potential variable conversion amount, constitutes a derivative which has been bifurcated from the note and recorded as a derivative liability, with a corresponding discount recorded to the associated debt. The excess of the derivative value over the face amount of the note is recorded immediately to interest expense at inception.

~~Future~~We ~~Liquidity~~have ~~Requirements~~audited the accompanying consolidated balance sheets of Rocky Mountain High Brands, Inc. and Subsidiaries (the “Company”) as of December 31, 2019 and 2018, and the related consolidated statements of operations, shareholders’ deficit and cash flows for the years ended December 31, 2019 and 2018, and the related notes to the consolidated financial statements (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2019 and 2018, and the results of its operations, shareholders’ deficit and its cash flows for the years ended December 31, 2019 and 2018, in conformity with accounting principles generally accepted in the United States of America.

~~During~~Going the year ending December 31, 2019, the Company expects to have an operational cash shortfall of approximately $1,000,000 to $1,500,000 depending on the timing, development, and advertising and marketing needs related to our future product rollouts. Our cash needs will be higher in the first half of 2019. In the second half of 2019, we expect our outside cash needs to lessen with a net operational positive cash flow in the fourth quarter of 2019. We expect our operational cash needs will be met by our current funding arrangements with GHS.Concern

20The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 3 to the consolidated financial statements, the Company has a shareholders’ deficit of $2,622,351 and an accumulated deficit of $40,285,145 as of December 31, 2019 and has generated operating losses since inception. These factors among others, raise substantial doubt regarding the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 3 to the accompanying financial statements. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

~~Table~~Basis for ~~of Contents~~Opinion

~~Off-Balance~~These ~~Sheet~~consolidated ~~Arrangements~~financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulation of the Securities and Exchange Commission and the PCAOB.

AsWe conducted our audits in accordance with the standards of ~~December~~the 31PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, ~~2018~~whether due to error or fraud. The company is not required to have, ~~there~~nor were nowe ~~off-balance~~engaged ~~sheet~~to ~~arrangements~~perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

~~Going~~Our ~~Concern~~audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included

~~The~~evaluating ~~accompanying financial statements have been prepared on a going concern basis, which contemplates~~ the ~~realization~~accounting ofprinciples ~~assets~~used and ~~the~~ ~~satisfaction~~significant ofestimates ~~liabilities~~made inby ~~the normal course of business. The Company has a shareholders’ deficit of $702~~management,~~555,~~ ~~an accumulated~~as ~~deficit~~well ~~of $35,018,351~~ as ofevaluating ~~December~~the ~~31,~~overall ~~2018,~~presentation ~~and has generated operating losses since inception. These factors,~~of ~~among others, raise substantial doubt about~~ the ~~ability~~consolidated offinancial ~~the~~statements. ~~Company~~We tobelieve ~~continue~~that asour aaudits ~~going~~provide ~~concern. The Company’s continuation as~~ a ~~going~~reasonable ~~concern~~basis isfor ~~dependent~~our ~~upon its ability to generate revenues and its ability to continue raising capital from third parties~~opinion.

On/s/ ~~June~~Prager ~~27,~~Metis ~~2018~~CPAs, ~~the Company entered into a Securities Purchase Agreement (“SPA”) with GHS Investments,~~ LLC (“GHS”), which provides for GHS to purchase up to $15,000,000 of the Company’s common stock over a 24-month period based on a contractually agreed upon market discount. In October 2018 the Company began sales of common stock to GHS under the SPA. Management believes the SPA will provide sufficient cash flows until cash flows from operations become consistently positive.

~~Critical~~We ~~Accounting~~have ~~Policies~~served as the Company’s auditor since 2018

InBasking ~~December 2001~~Ridge, ~~the~~New SEC requested that all registrants list their most “critical accounting polices” in the Management Discussion and Analysis. The SEC indicated that a “critical accounting policy” is one which is both important to the portrayal of a company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. We do not believe that the following accounting policies currently fit this definition:Jersey

~~Use~~July of8, ~~Estimates~~2020

The preparation of the financial statements in conformity with Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Certain of the Company’s estimates could be affected by external conditions, including those unique to its industry, and general economic conditions. It is possible that these external factors could have an effect on the Company’s estimates that could cause actual results to differ from its estimates. The Company reF-~~evaluates all of its accounting estimates at least quarterly based on these conditions and record adjustments when necessary.~~1

~~Revenue Recognition~~Table of Contents

~~The~~ Rocky ~~Company~~Mountain ~~follows~~High ~~the guidance of the Accounting Standards Codification (“ASC”) Topic 606~~Brands, ~~“Revenue from Contracts with Customers,” as amended~~Inc. ~~We record revenue when persuasive evidence of an arrangement exists, product delivery has occurred, the selling price to the customer is fixed or determinable~~ and collectability of the revenue is reasonably assured. The Company has not experienced any significant returns from customers and accordingly, in management’s opinion, no reserve for returns has been provided. Payments received prior to shipment of goods are recorded as deferred revenue.Subsidiaries

~~Accounts~~Consolidated ~~Receivable~~Balance ~~and Allowance for Doubtful Accounts Receivable~~Sheets

The Company has a policy of reserving for uncollectible accounts based on the best estimate of the amount of probable credit losses in our existing accounts receivable. We extend credit to customers based on an evaluation of their financial condition and other factors. The Company generally does not require collateral or other security to support accounts receivable and perform ongoing credit evaluations of customers and maintain an allowance for potential bad debts if required.

	December 31, 2019			December 31, 2018

CURRENT ASSETS

Cash	$	68,080		$	613,686
Accounts Receivable, net of allowance of $0 and $5,275, respectively		18,162			17,324
Inventory		238,035			146,722
Prepaid Expenses and Other Current Assets		174,726			388,074
TOTAL CURRENT ASSETS		499,003			1,165,806

Property and Equipment, net		19,342			34,280
Intangible Assets		13,008			148,647
Other Assets		14,606			26,245

TOTAL ASSETS	$	545,959		$	1,374,978

LIABILITIES AND SHAREHOLDERS' DEFICIT

CURRENT LIABILITIES

Accounts Payable and Accrued Liabilities	$	1,143,217		$	505,214
Related Party Payables		30,406			—
Convertible Notes Payable, net of debt discount		1,008,950			666,596
Notes Payable		30,000			37,493
Accrued Interest		96,134			25,758
Deferred Revenue		445,925			466,300
Derivative Liability		413,678			376,172
TOTAL CURRENT LIABILITIES		3,168,310			2,077,533

SHAREHOLDERS' DEFICIT
Preferred Stock - Series A - Par Value of $.001; 1,000,000 shares designated; No shares issued and outstanding as of December 31, 2019 and December 31, 2018		—			—
Preferred Stock - Series B - Par Value of $.001; 7,000,000 shares designated; No shares issued and outstanding as of December 31, 2019 and December 31, 2018		—			—
Preferred Stock - Series C - Par Value of $.001; 2,000,000 shares designated; No shares issued and outstanding as of December 31, 2019 and December 31, 2018		—			—
Preferred Stock - Series D - Par Value of $.001; 2,000,000 shares designated; No shares issued and outstanding as of December 31, 2019 and December 31, 2018		—			—
Preferred Stock - Series E - Par Value of $.001; 789,474 shares designated; No shares issued and outstanding as of December 31, 2019 and December 31, 2018		—			—
Preferred Stock - Series F - Par Value of $.001; 1,680 shares designated; 130 shares issued and outstanding as of December 31, 2019 and no shares issued and outstanding as of December 31, 2018		—			—
Preferred Stock - Series G - Par Value of $.001; 10,000 shares designated; 10,000 shares issued and outstanding as of December 31, 2019 and no shares issued and outstanding as of December 31, 2018		10			—
Common Stock - Par Value of $.001; 200,000,000 shares authorized; 137,914,630 shares issued and outstanding as of December 31, 2019; 94,580,869 shares issued and outstanding as of December 31, 2018		137,915			94,581
Additional Paid-In Capital		37,528,496			34,221,215
Accumulated Deficit		(40,285,145	)		(35,018,351)
Total Rocky Mountain High Brands Shareholders' Deficit		(2,618,724	)		(702,555)
Noncontrolling Interests		(3,627	)		—
TOTAL SHAREHOLDERS' DEFICIT		(2,622,351	)		(702,555)

TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT	$	545,959		$	1,374,978

It is determined whether an allowance for doubtful accounts is required by evaluating specific accounts where information indicates the customers may have an inability to meet financial obligations. In these cases, we use assumptions and judgment, based on the best available facts and circumstances, to record a specific allowance for those customers against amounts due to reduce the receivable to the amount expected to be collected. These specific allowances are re-evaluated and adjusted as additional information is received. The ~~amounts~~Accompanying ~~calculated~~Notes are ~~analyzed~~an toIntegral ~~determine~~Part ~~the total amount~~ of the ~~allowance. The~~Consolidated ~~Company~~Financial ~~may also record a general allowance as necessary.~~Statements

21F-2

Table of Contents

~~Direct~~ Rocky ~~write-offs~~Mountain ~~are~~High ~~taken~~Brands, inInc. ~~the period when we have exhausted our efforts to collect overdue~~ and ~~unpaid receivables or otherwise evaluate other circumstances that indicate the collectability of receivables.~~Subsidiaries

~~Inventories~~Consolidated Statements of Operations

Inventories, which consist of the Company’s product held for resale, are stated at the lower of cost, determined using the first-in, first-out, and net realizable value. Net realizable value is the estimated selling price, in the ordinary course of business, less estimated costs to complete and dispose of the product.

	Year Ended
	December 31, 2019			December 31, 2018

Sales	$	205,250		$	379,238

Cost of Sales		610,772			385,673
Inventory Obsolescence		130,364			25,145

Gross Loss		(535,886	)		(31,580)

Operating Expenses
General and Administrative		3,098,964			3,689,175
Advertising and Marketing		642,324			833,933
Impairment Expense		118,066			—
Total Operating Expenses		3,859,354			4,523,108

Loss from Operations		(4,395,240	)		(4,554,688)

Other (Income)/Expenses:
Interest Expense		877,740			1,275,693
Loss on Extinguishment of Debt		172,910			191,138
Gain on Lawsuit Judgment and Legal Settlement		(200,817	)		(689,724)
(Gain) Loss on Change in Fair Value of Derivative Liability		25,844			(1,975,858)
Total Other (Income) Expenses		875,677			(1,198,751)

Loss Before Income Tax Provision		(5,270,917	)		(3,355,937)

Income Tax Provision		—			—

Net Loss	$	(5,270,917	)	$	(3,355,937)

Net Loss Attributable to Noncontrolling Interests		(4,123	)		—

Net Loss Attributable to Rocky Mountain High Brands	$	(5,266,794	)	$	(3,355,937)

Net Loss per Common Share - Basic and Diluted	$	(0.05	)	$	(0.04)

Weighted Average Shares Outstanding		115,143,080			80,285,967

~~If the~~The ~~Company identifies excess, obsolete or unsalable items, its inventories are written down to their realizable value in the~~Accompanying ~~period~~Notes ~~in which the impairment is first identified. Shipping and handling costs incurred for inventory purchases and product shipments~~ are ~~recorded~~an inIntegral ~~cost~~Part of ~~sales in~~ the ~~Company's~~Consolidated ~~statements~~Financial ~~of operations.~~Statements

~~Fair Value Measurements~~F-3

~~The Company~~Table ~~adopted the provisions~~ of ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements.Contents

~~The~~ Rocky ~~estimated~~ Mountain ~~fair~~High ~~value of certain financial instruments~~Brands, including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instrumentsInc. ~~The carrying amounts of our short~~ and long-term credit obligations approximate fair value because the effective yields on these obligations, which include contractual interest rates taken together with other features such as concurrent issuances of warrants and/or embedded conversion options, are comparable to rates of returns for instruments of similar credit risk.Subsidiaries

~~ASC~~Consolidated ~~820~~Statements 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, which requires an entity to maximize the use of ~~observable inputs~~Shareholders’ ~~and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:~~Deficit

•For the ~~Level~~Years 1Ended —December ~~quoted~~31, ~~prices~~2019 inand ~~active markets for identical assets or liabilities.~~2018

• Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable.

	Common Stock			Series A Preferred			Series C Preferred			Series E Preferred			Series F Preferred			Series G Preferred							Accumulated			Total RMHB Shareholders'			Noncontrolling			Total Shareholders'
	Shares		Amount	Shares		Amount	Shares		Amount	Shares		Amount	Shares		Amount	Shares		Amount		APIC			Deficit			Deficit			Interests			Deficit
Balance - December 31, 2018	94,580,869	$	94,581	—	$	—	—	$	—	—	$	—	—	$	—	—	$	—	$	34,221,215		$	(35,018,351	)	$	(702,555	)	$	—		$	(702,555)
Sweet Ally purchase of Sweet Rock, Inc. shares	—		—	—		—	—		—	—		—	—		—	—		—		—			—			—			496			496
Shares issued for cash	39,238,908		39,239	—		—	—		—	—		—	130		—	—		—		2,316,046			—			2,355,284			—			2,355,284
Shares issued for compensation	25,403		25	—		—	—		—	—		—	—		—	10,000		10		13,966			—			14,002			—			14,002
Shares issued upon conversion of convertible notes	4,065,980		4,066	—		—	—		—	—		—	—		—	—		—		222,615			—			226,681			—			226,681
Fractional shares issued as a result of the reverse stock split	3,470		4	—		—	—		—	—		—	—		—	—		—		(3	)		—			—			—			—
Stock option forfeiture	—		—	—		—	—		—	—		—	—		—	—		—		9,530			—			9,530			—			9,530
Beneficial conversion feature recognized on convertible notes payable	—		—	—		—	—		—	—		—	—		—	—		—		745,128			—			745,128			—			745,128
Net loss for the year ended December 31, 2019	—		—	—		—	—		—	—		—	—		—	—		—		—			(5,266,794	)		(5,266,794	)		(4,123	)		(5,270,917)
Balance - December 31, 2019	137,914,630	$	137,915	—	$	—	—	$	—	—	$	—	130	$	—	10,000	$	10	$	37,528,496		$	(40,285,145	)	$	(2,618,724	)	$	(3,627	)	$	(2,622,351)

• Level 3 — inputs that are unobservable (for example cash flow modeling inputs based on assumptions).

	Common Stock						Series A Preferred						Series C Preferred				Series E Preferred				Series F Preferred				Series G Preferred							Accumulated			Total RMHB Shareholders’			Noncontrolling		Total Shareholders'
	Shares			Amount			Shares			Amount			Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		APIC			Deficit			Deficit			Interests		Deficit
Balance - December 31, 2017		57,985,323		$	57,985			1,000,000		$	1,000			—	$	—		—	$	—		—	$	—		—	$	—	$	24,561,530		$	(31,662,414	)	$	(7,041,899	)	$	—	$	(7,041,899)
Shares issued for cash		19,302,572			19,303			—			—			—		—		—		—		—		—		—		—		3,650,200			—			3,669,503			—		3,669,503
Shares issued for compensation		679,873			680			—			—			—		—		—		—		—		—		—		—		157,507			—			158,187			—		158,187
Shares issued for stock option exercises		1,454,820			1,455			—			—			—		—		—		—		—		—		—		—		27,641			—			29,096			—		29,096
Options issued for compensation		—			—			—			—			—		—		—		—		—		—		—		—		108,205			—			108,205			—		108,205
Shares issued upon conversion of convertible notes		14,468,528			14,469			—			—			—		—		—		—		—		—		—		—		4,006,796			—			4,021,265			—		4,021,265
Shares to vendors for services rendered		407,527			408			—			—			—		—		—		—		—		—		—		—		81,855			—			82,263			—		82,263
Shares issued for acquisition		373,134			373			—			—			—		—		—		—		—		—		—		—		74,627			—			75,000			—		75,000
Shares returned as part of lawsuit judgment and legal settlement		(90,909	)		(91	)		(1,000,000	)		(1,000	)		—		—		—		—		—		—		—		—		(1,727	)		—			(2,818	)		—		(2,818)
Beneficial conversion feature recognized on convertible notes payable		—			—			—			—			—		—		—		—		—		—		—		—		1,554,580			—			1,554,580			—		1,554,580
Net loss for the year ended December 31, 2018		—			—			—			—			—		—		—		—		—		—		—		—		—			(3,355,937	)		(3,355,937	)		—		(3,355,937)
Balance - December 31, 2018		94,580,869		$	94,581			—		$	—			—	$	—		—	$	—		—	$	—		—	$	—	$	34,221,215		$	(35,018,351	)	$	(702,555	)	$	—	$	(702,555)

The Accompanying ~~derivative~~Notes ~~liability,~~are ~~which~~an ~~relates~~Integral toPart ~~the conversion feature~~ of ~~convertible debt and common stock warrants and options, is classified as a Level 3 liability, and is~~ the ~~only~~Consolidated ~~financial~~Financial ~~liability measure at fair value on a recurring basis.~~Statements

22F-4

Table of Contents

~~The~~ Rocky ~~change~~Mountain inHigh ~~the~~Brands, ~~Level~~Inc. 3and ~~financial instruments is as follows:~~Subsidiaries

Balance, June 30, 2017	$	5,072,579
Issued		4,017,623
Exercises/Conversions	$	(5,276,018)
Change in fair value recognized in operations	$	1,795,205
Balance, December 31, 2017	$	5,609,389
Issued	$	—
Exercises/Conversions	$	(3,257,359)
Change in fair value recognized in operations	$	(1,975,858)
Balance, December 31, 2018	$	376,172

Consolidated Statements of Cash Flows

The estimated fair value of the derivative instruments was valued using the Black-Scholes option pricing model, using the following assumptions as of December 31, 2018 and December 31, 2017:

	Year Ended
	December 31, 2019			December 31, 2018

Operating Activities:
Net Loss	$	(5,270,917	)	$	(3,355,937)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation		191,824			456,007
Stock-based payments to vendors		—			80,445
Warrants and options issued for services rendered		—			108,205
Non-cash interest expense		865,926			1,160,857
Fees and penalties on debt		—			120,251
Noncash portion of gain on lawsuit judgment and legal settlement		—			(689,724)
Loss on change in fair value of derivative liability		25,844			(1,975,858)
Loss on extinguishment of debt		172,910			191,138
Bad debt expense		1,678			1,536
Depreciation and amortization expense		36,401			34,423
Impairment of goodwill and other intangibles		118,066			—
Inventory obsolescence		130,364			25,145
Changes in operating assets and liabilities:
Accounts receivable		(2,516	)		(16,017)
Inventory		(221,676	)		(89,556)
Prepaid expenses and other current assets		35,524			(22,076)
Other assets		972			(12,765)
Accounts payable and accrued liabilities		638,005			(211,156)
Related party payables		30,406			—
Deferred revenue		(20,375	)		466,300
NET CASH USED IN OPERATING ACTIVITIES		(3,267,564	)		(3,728,782)

Investing Activities:
Investments in Sweet Rock, LLC		(500	)		—
Investments in other assets		—			(31,220)
Cash acquired in business acquisition		—			15,612
Acquisition of property and equipment		—			(18,307)
Disposal of property and equipment		7,167			—
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES		6,667			(33,915)

Financing Activities:
Proceeds from issuance of convertible notes		367,500			877,500
Repayment of convertible notes		—			(172,932)
Repayment of notes payable		(7,493	)		(14,672)
Proceeds from issuance of Series F Preferred Stock		100,000			—
Proceeds from issuance of common stock		2,255,284			3,669,504
NET CASH PROVIDED BY FINANCING ACTIVITIES		2,715,291			4,359,400

INCREASE (DECREASE) IN CASH		(545,606	)		596,703

CASH - BEGINNING OF PERIOD		613,686			16,983

CASH - END OF PERIOD	$	68,080		$	613,686

Supplemental cash flow information:
Cash paid for interest	$	11,814		$	56,742
Cash paid for taxes	$	—		$	—
Supplemental disclosure of non-cash financing and investing activities:
Common stock issued for conversion of debt	$	226,681		$	4,000,604
Debt and accrued interest converted for common stock	$	271,189		$	499,053
Derivative liability relieved upon conversion of related debt	$	—		$	3,021,935
Beneficial conversion feature recognized as debt discount	$	745,128		$	1,351,790
Common stock issued for acquisition	$	—		$	75,000

	December 31, 2018		December 31, 2017
Estimated dividends		None		None
Expected volatility		106%		114%
Risk free interest rate		2.41%		.84%
Expected term		.1 to 4.0 years		1 to 2.0 years

The Accompanying Notes are an Integral Part of the Consolidated Financial Statements

~~Property and Equipment~~F-5

~~Property and~~Table ~~equipment is stated at cost less accumulated depreciation. Depreciation is provided for on a straight-line basis over the useful lives~~ of ~~the assets. Expenditures for additions and improvements are capitalized; repairs and maintenance are expensed as incurred.~~Contents

~~Impairment of~~Rocky ~~Long-Lived~~Mountain ~~Assets~~High Brands, Inc. and Subsidiaries

~~The Company~~Notes evaluates intangible assets for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flow and recognizes an impairment loss when the estimated undiscounted future cash flow expected to ~~result~~Consolidated ~~from~~Financial the use of the asset plus the net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. When the Company identifies an impairment, it reduces the carrying amount of the asset to its estimated fair value based on a discounted cash flow approach or, when available and appropriate, to comparable market values. During the six months and year ended December 31, 2017 the Company recorded an impairment charge on the goodwill related to the acquisition of Rocky Mountain High Water Company in the amount of $59,163. As of December 31, 2018 and 2017, the goodwill related to this acquisition is fully impaired. No impairment charges were recorded during the year ended December 31, 2018.Statements

~~Share-Based Payments~~NOTE 1 – General

~~Share-based payments~~Rocky toMountain ~~employees~~High Brands, ~~including~~Inc. (“RMHB” ~~grants~~or ofthe ~~employee~~“Company”) ~~stock~~is ~~options,~~incorporated ~~are~~under ~~recognized~~the aslaws ~~compensation~~of ~~expense in~~ the ~~financial~~State ~~statements based~~of onNevada. ~~their~~On ~~fair~~July ~~values~~17, in2014, ~~accordance~~the Company ~~with~~changed ~~FASB~~its ~~ASC~~name ~~Topic~~from ~~718.~~Republic ~~That~~of ~~expense~~Texas isBrands ~~recognized~~Incorporated ~~over~~to ~~the~~Totally ~~period~~Hemp ~~during~~Crazy, ~~which~~Inc ~~an employee~~and ison ~~required~~October to23, ~~provide~~2014, ~~services in exchange for~~ the ~~award,~~Company changed ~~known~~its asname ~~the~~to ~~requisite~~Rocky ~~service~~Mountain ~~period~~High ~~(usually~~Brands, ~~the vesting period)~~Inc.

~~The Company~~RMHB ~~issued~~currently ~~restricted~~operates ~~stock to consultants and employees for various services. Cost for these transactions are measured at~~through ~~the~~its ~~fair~~parent ~~value~~company, offour ~~the~~wholly-owned ~~consideration~~subsidiaries, ~~received~~one ormajority-owned ~~the~~subsidiary, ~~fair~~and ~~value~~one ofminority-owned ~~the equity instruments issued~~subsidiary, ~~whichever is more reliably measurable. The value of the common stock is to be measured at the earlier of (i) the date at~~ which ~~a firm commitment for performance by~~ the ~~counterparty~~Company tocontrols. ~~earn~~All ~~the~~subsidiaries ~~equity~~are ~~instruments~~consolidated isfor ~~reached~~financial orreporting ~~(ii) the date at which the counterparty's performance is complete~~purposes.

23RMHB is a consumer goods company that specializes in the developing, manufacturing, marketing, and distributing high-quality, health conscious, hemp oil and hemp extract-infused products that span various categories including beverage, food, fitness, skin care, and more. RMHB also markets a naturally high alkaline spring water as part of our brand portfolio. All products comply with federal regulations on hemp products and contain 0.0% tetrahydrocannabinol (“THC”), the psychoactive constituent of cannabis. Recently, through a newly created subsidiary of RMHB, Rocky Mountain Productions, Inc., the Company acquired a bottling and canning facility and is now also in the business of canning both its own beverages as well as canning beverages for other customers. Furthermore, as a result of equipment included in the acquisition of the facility, RMHB is also in the business of bottling hand sanitizer. Because of the demand resulting with the COVID-19 pandemic, RMHB anticipates continuing in the bottling of hand sanitizer for the foreseeable future.

~~Table~~In March 2018, the Company launched the HEMPd brand with gummies, water soluble drops, capsules, tinctures, lotions, and salves. The Company introduced four flavors of ~~Contents~~CBD-infused waters in 12 oz. cans in November 2018.

~~Convertible~~In July 2018, the Company acquired ~~Instruments~~the assets of BFIT Brands, LLC and formed a new subsidiary, FitWhey Brands Inc. FitWhey marketed a line-up of five water-based protein drinks that include caffeine and B vitamins. In August 2019 the Company suspended the production of FitWhey products.

~~The Company~~On ~~evaluates~~June ~~and~~12, ~~accounts~~2019, ~~for~~the ~~conversion~~Company ~~options~~organized Sweet ~~embedded~~Rock, inLLC ~~convertible instruments in accordance with ASC 815~~ (“~~Derivatives and~~Sweet ~~Hedging Activities.~~Rock”), Applicable GAAP requires companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) ~~the~~51% ~~economic~~owned ~~characteristics~~company, ~~and~~with ~~risks~~Sweet ~~of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract~~Ally, ~~(b)~~Inc. ~~the~~Sweet ~~hybrid~~Rock ~~instrument~~will ~~that~~manufacture ~~embodies both the embedded derivative instrument~~ and ~~the~~market ~~host contract is not re~~CBD-~~measured at fair value under other GAAP with changes in fair value reported in earnings~~infused aschocolate, ~~they~~hard ~~occur~~candies, and ~~(c)~~baked ~~a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument~~goods.

~~Preferred~~On April 29, 2020 the Company formed ~~Stock~~Rocky Mountain Productions, Inc. (“RMPI”), a wholly-owned Nevada corporation. On April 30, 2020, RMPI purchased certain assets of Raw Pharma, LLC (“Raw Pharma”) including machinery, equipment, and fixtures. The facility has the capability to can and bottle products, including 12 oz. regular and sleek cans, 16 oz. cans, shots, and bottles.

~~We apply~~During ~~the~~2018 ~~guidance enumerated in ASC 480 “Distinguishing Liabilities from Equity” when determining the classification~~ and ~~measurement~~early of preferred stock. Preferred shares subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. We classify conditionally redeemable preferred shares (if any)2019, ~~which includes preferred shares~~the ~~that~~Company ~~feature~~continued ~~redemption rights that are either within the control of the holder or subject~~ to ~~redemption~~market ~~upon~~its ~~the~~lineup ~~occurrence~~ of ~~uncertain~~ ~~events~~naturally ~~not~~flavored ~~solely~~hemp-infused ~~within~~functional ~~our control~~beverages, as ~~temporary~~well ~~equity.~~as Athemp-infused ~~all~~2oz. ~~other times, we classify our preferred shares in shareholders’~~Mango ~~equity.~~Energy ~~Our~~Shots ~~preferred~~and ~~shares~~Mixed doBerry ~~not~~Energy ~~feature~~Shots ~~any~~through ~~redemption rights within~~ the ~~holders’~~first ~~control~~half ~~or conditional redemption features not within our control. Accordingly, unless otherwise noted, all issuances~~ of ~~preferred stock are presented as a component of consolidated shareholders’ equity (deficit)~~2018.

~~Recently~~The Company also bottles and distributes ~~Issued~~its ~~Accounting~~naturally ~~Pronouncements~~high alkaline spring water under the name Eagle Spirit Spring Water.

~~Unless otherwise~~On ~~noted~~April 22, we2019 ~~have elected to use~~ the ~~extended~~reverse ~~transition period for complying with new or revised accounting standards~~split ~~under Section 102(b)(1)~~ of the ~~JOBS~~Company’s ~~Act.~~stock, ~~This~~at ~~allows~~a usratio ~~to delay the adoption~~ of ~~new~~one orshare ~~revised~~for ~~accounting~~every ~~standards~~20 ~~that~~shares, ~~have different~~was effective. ~~dates~~All ~~for~~common ~~public~~stock share and ~~private~~per ~~companies until those standards apply to private companies. As a result of our~~share ~~election,~~amounts ~~our~~in ~~financial~~this ~~statements~~document ~~may~~reflect ~~not~~this bereverse ~~comparable with other public companies~~split.

~~In February~~NOTE ~~2016,~~2 ~~the~~– ~~Financial~~Summary ~~Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 840), which requires lessees to recognize on the balance sheet a right-~~of~~-use~~ ~~asset, representing~~Significant ~~their~~Accounting right to use the underlying asset for the lease term, and a lease liability for all leases with terms greater than 12 months. The guidance also requires qualitative and quantitative disclosures designed to assess the amount, timing and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for the Company beginning January 1, 2020. The Company is currently evaluating the impact that ASU 2016-02 will have on its consolidated financial statements.Policies

~~In June~~Principles ~~2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326), which requires the immediate recognition~~ of management’s estimates of current and expected credit losses. ASU 2016-13 is effective for the Company beginning January 1, 2021. The Company is currently evaluating the potential impact of adopting this guidance on our financial statements.Consolidation

~~In January~~The ~~2017,~~consolidated ~~the~~financial ~~FASB issued ASU 2017-01, Business Combinations: Clarifying the Definition of a Business (Topic 805),~~statements ~~which~~have ~~clarifies~~been ~~the~~prepared ~~definition~~in ofaccordance ~~a business~~ with ~~the~~generally ~~objective~~accepted ofaccounting ~~adding~~principles ~~guidance~~in tothe ~~assist~~United ~~entities~~States. ~~with~~The ~~evaluating~~consolidated ~~whether~~financial ~~transactions~~statements ~~should~~include bethe ~~accounted~~accounts ~~for as acquisitions (or disposals)~~ of ~~assets~~the orCompany, ~~businesses.~~its ~~ASU 2017~~wholly-01owned ~~is required to be applied prospectively~~ and ~~will~~controlled ~~be effective for the Company beginning January 1, 2019~~subsidiaries. ~~The~~All ~~impact~~intercompany onbalances ~~our~~and ~~consolidated financial statements~~transactions ~~will~~have ~~depend~~been ~~on the facts and circumstances of any specific future transactions~~eliminated.

~~In May 2018, the FASB issued ASU 2018~~F-09, Compensation-Stock Compensation: Scope of Modification Accounting. This ASU amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards an entity is required to apply modification accounting under ASC 718. This update is effective for the Company beginning January 1, 2021. The Company is currently evaluating the impact that ASU 2018-09 will have on its consolidated financial statements.6

~~In June~~Table ~~2018,~~of the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. The guidance is intended to reduce the complexity associated with issuers’ accounting for share-based payment transactions for acquiring goods and services. The ASU is effective for the Company beginning January 1, 2022. The Company is currently evaluating the impact that ASU 2018-07 will have on its consolidated financial statements.Contents

~~In July~~Use 2018, the FASB issued ASU 2018-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480): Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The guidance is intended to reduce the complexity associated with issuers’ accounting for certain financial instruments with characteristics of liabilities and equity. Specifically, a down round feature (as defined) would no longer cause a freestanding equity-linked financial instrument (or an embedded conversion option) to be accounted for as a derivative liability at fair value with changes in fair value recognized in current earnings. The amendments in this ASU are effective for the Company beginning January 1, 2020. The Company is currently evaluating the impact that ASU 2018-11 will have on its consolidated financial statements.Estimates

~~In August~~The ~~2018,~~preparation of the ~~FASB~~financial statements ~~issued~~in ~~ASU~~conformity ~~2018-13,~~with ~~Fair~~Generally ~~Value~~Accepted ~~Measurements:~~Accounting ~~Disclosure~~Principles ~~Framework~~(“GAAP”) ~~Changes~~requires management to make estimates and assumptions that affect the ~~Disclosure~~reported ~~Requirements~~amounts of assets and liabilities and disclosure of contingent assets and liabilities ~~for~~at ~~Fair~~the ~~Value~~dates ~~Measurement.~~of ~~This~~the ~~update~~financial ~~modifies~~statements and the ~~disclosure~~reported ~~requirements~~amounts onof ~~fair~~revenue ~~value~~and ~~measurements~~expenses induring ~~Topic~~the ~~820~~reporting periods. ~~The~~Actual ~~ASU~~results iscould ~~effective~~differ ~~for~~from those estimates. Certain of the Company’s ~~beginning~~estimates ~~January~~could 1be affected by external conditions, ~~2021.~~including those ~~The~~unique ~~Company~~to its industry, and general economic conditions. It is ~~currently~~possible ~~evaluating~~that these external factors could have an effect on the ~~impact~~Company’s estimates that ~~ASU~~could ~~2018~~cause actual results to differ from its estimates. The Company re-13evaluates ~~will~~all of ~~have~~its accounting estimates at least quarterly based on ~~its~~these ~~consolidated~~conditions ~~financial~~and ~~statements~~record adjustments when necessary.

24Cash

~~Table~~The ofCompany ~~Contents~~maintains cash balances at various financial institutions. At times, these balances may exceed federally insured limits.

~~Item 7A.~~Accounts ~~Quantitative~~Receivable and ~~Qualitative~~Allowance for ~~Disclosures~~Doubtful ~~About~~Accounts ~~Market Risk~~Receivable

AThe Company has a policy of reserving ~~smaller~~for ~~reporting~~uncollectible ~~company~~accounts isbased on the best estimate of the amount of probable credit losses in our existing accounts receivable. We extend credit to customers based on an evaluation of their financial condition and other factors. The Company generally does not ~~required~~require collateral or other security to ~~provide~~support ~~the~~accounts ~~information~~receivable ~~required~~and byperform ~~this~~ongoing ~~Item~~credit evaluations of customers and maintain an allowance for potential bad debts if required.

~~Item~~It is determined whether an allowance 8for doubtful accounts is required by evaluating specific accounts where information indicates the customers may have an inability to meet financial obligations. ~~Financial~~In ~~Statements~~these cases, we use assumptions and ~~Supplementary~~judgment, ~~Data~~based on the best available facts and circumstances, to record a specific allowance for those customers against amounts due to reduce the receivable to the amount expected to be collected. These specific allowances are re-evaluated and adjusted as additional information is received. The amounts calculated are analyzed to determine the total amount of the allowance. The Company may also record a general allowance as necessary.

~~Index~~Direct write-offs are taken in the period when we have exhausted our efforts to ~~Financial~~collect ~~Statements~~overdue ~~Required~~and byunpaid ~~Article~~receivables 8or ofotherwise ~~Regulation~~evaluate ~~S-X:~~other circumstances that indicate the collectability of receivables.

~~Audited Financial Statements:~~Inventories

F-1		Report of Prager Metis, CPAs, LLC, Independent Registered Public Accounting Firm
F-2		Report of Paritz & Company, P.A., Independent Registered Public Accounting Firm
F-3		Consolidated Balance Sheets as of December 31, 2018 and December 31, 2017
F-4		Consolidated Statements of Operations for the years ended December 31, 2018 and December 31, 2017, and the six months ended December 31, 2017 and December 31, 2016
F-5		Consolidated Statements of Cash Flows for the years ended December 31, 2018 and December 31, 2017, and the six months ended December 31, 2017 and December 31, 2016
F-6		Consolidated Statements of Shareholder’s Deficit for the years ended December 31, 2018 and December 31, 2017
F-7		Consolidated Statements of Shareholder’s Deficit for the six months ended December 31, 2017 and December 31, 2016
F-8		Notes to Consolidated Financial Statements.

Inventories, which consist of the Company’s finished products held for resale, raw materials, and packaging, are stated at the lower of cost, determined using the first-in, first-out, and net realizable value. Net realizable value is the estimated selling price, in the ordinary course of business, less estimated costs to dispose of the product.

25If the Company identifies excess, obsolete or unsalable items, its inventories are written down to their realizable value in the period in which the impairment is first identified. Shipping and handling costs incurred for inventory purchases and product shipments are recorded in cost of sales in the Company’s statements of operations.

~~Table~~Fair ofValue ~~Contents~~Measurements

~~REPORT~~The OFCompany ~~INDEPENDENT~~adopted ~~REGISTERED~~the ~~PUBLIC~~provisions ~~ACCOUNTING~~of ~~FIRM~~ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements.

ToThe estimated fair value of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued expenses are carried at historical cost basis, which approximates their fair values because of the ~~Board~~short-term nature of ~~Directors~~these instruments. The carrying amounts of our short and ~~Stockholders~~long-term credit obligations approximate fair value because the effective yields on these obligations, which include contractual interest rates taken together with other features such as concurrent issuances of warrants and/or embedded conversion options, are comparable to rates of returns for instruments of similar credit risk.

~~Rocky Mountain High Brands, Inc.~~F-7

~~Opinion~~Table onof ~~the Consolidated Financial Statements~~Contents

WeASC ~~have~~820 ~~audited~~defines ~~the~~fair ~~accompanying~~value ~~consolidated~~as the ~~balance~~exchange ~~sheet~~price ofthat ~~Rocky~~would ~~Mountain~~be ~~Brands,~~received ~~Inc.~~for ~~(the~~an ~~Company)~~asset asor ofpaid ~~December~~to ~~31,~~transfer ~~2018,~~a ~~and~~liability ~~the~~(an ~~related~~exit ~~consolidated~~price) ~~statement~~in ofthe ~~operations, stockholders’~~principal ~~deficit,~~or ~~and~~most ~~cash~~advantageous market ~~flows~~ for the ~~year~~asset ~~ended~~or ~~December~~liability ~~31,~~in ~~2018,~~an ~~and~~orderly ~~the~~transaction ~~related~~between ~~notes~~market ~~(collectively~~participants ~~referred to~~on as the ~~consolidated~~measurement ~~financial statements)~~date. InASC ~~our~~820 ~~opinion,~~also ~~the~~establishes a ~~consolidated~~fair ~~financial~~value ~~statements present fairly~~hierarchy, inwhich ~~all~~requires ~~material respects,~~an ~~the~~entity ~~financial~~to ~~position~~maximize of the ~~Company~~use as of ~~December~~observable ~~31,~~inputs ~~2018,~~ and minimize the ~~results~~use of ~~its operations and its cash flows for~~unobservable ~~the~~inputs ~~year~~when ~~ended~~measuring ~~December~~fair ~~31,~~value. ~~2018,~~ASC in820 ~~conformity~~describes ~~with~~three ~~accounting~~levels ~~principles~~of ~~generally~~inputs ~~accepted~~that inmay ~~the~~be ~~United~~used ~~States~~to ofmeasure ~~America.~~fair value:

~~Going~~• ~~Concern~~Level 1 — quoted prices in active markets for identical assets or liabilities.

~~The~~• ~~accompanying~~Level ~~financial~~2 ~~statements have~~— ~~been~~quoted ~~prepared~~prices ~~assuming~~for ~~that~~similar ~~the~~assets Company will continue as a going concern. As described in Note 3 to the consolidated financial statements, the Company has a shareholders’ deficit of $702,555, an accumulated deficit of $35,018,351 as of December 31, 2017, and ~~has~~liabilities ~~generated operating losses since inception. These factors, among others, raise substantial doubt regarding the Company’s ability to continue as a going concern. Management’s plans~~ in ~~regard~~active tomarkets ~~these~~or ~~matters~~inputs ~~are also described in Note 3 to the accompanying financial statements. The accompanying financial statements do not include any adjustments~~ that ~~might~~are ~~result from the outcome of this uncertainty~~observable.

~~Basis~~• Level 3 — inputs that are unobservable (for ~~Opinion~~example cash flow modeling inputs based on assumptions).

~~These~~The ~~consolidated~~derivative ~~financial~~liability, ~~statements~~which ~~are~~relates ~~the~~to ~~responsibility of~~ the ~~Company’s~~conversion ~~management.~~feature ~~Our~~of ~~responsibility~~convertible isdebt toand ~~express~~common anstock ~~opinion~~warrants onand ~~the~~options, ~~Company’s~~is ~~consolidated financial~~classified ~~statements~~as ~~based on our audits. We are~~ a ~~public~~Level ~~accounting~~3 ~~firm registered with the Public Company Accounting Oversight~~liability, ~~Board (United States) (PCAOB)~~ and ~~are~~is ~~required to be independent with respect to~~ the ~~Company~~only infinancial ~~accordance~~liability ~~with~~measure ~~the~~at ~~U.S.~~fair ~~federal securities~~value ~~laws~~on ~~and~~a ~~the~~recurring ~~applicable rules and regulations of the Securities and Exchange Commission and the PCAOB~~basis.

WeThe ~~conducted~~change ~~our audits~~ in ~~accordance with~~ the ~~standards~~Level of3 ~~the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether~~financial ~~the~~instruments ~~consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company~~ is ~~not~~as required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.follows:

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Balance, January 1, 2018	$	5,609,389
Issued		—
Exercises/Conversions		(3,257,359)
Change in fair value recognized in operations		(1,975,858)
Balance, December 31, 2018	$	376,172
Issued		21,193
Exercises/Conversions/Expirations		(9,531)
Change in fair value recognized in operations		25,844
Balance, December 31, 2019	$	413,678

~~/s/~~The ~~Prager~~estimated ~~Metis~~fair ~~CPA’s~~value ~~LLC~~of Wethe derivative ~~have~~instruments ~~served~~was asvalued using the ~~Company’s~~Black-Scholes ~~auditor~~option ~~since~~pricing ~~2018. Hackensack~~model, ~~New~~using ~~Jersey~~the ~~April~~following 12assumptions as of December 31, 2019 and December 31, 2018:

F-1

	December 31, 2019			December 31, 2018
Estimated dividends		None			None
Expected volatility		137	%		106%
Risk free interest rate		1.47	%		2.41%
Expected term		.1 to 3.25 years			1 to 4.0 years

~~Table~~Property ofand ~~Contents~~Equipment

~~REPORT~~Property OFand ~~INDEPENDENT~~equipment ~~REGISTERED~~is stated ~~PUBLIC~~at cost less accumulated depreciation. Depreciation is provided for on a straight-line basis over the useful lives of ~~ACCOUNTING~~the ~~FIRM~~assets which generally range from 3-5 years. Expenditures for additions and improvements are capitalized; repairs and maintenance are expensed as incurred.

ToImpairment ~~the Board~~ of ~~Directors~~Long-Lived ~~and Stockholders of~~Assets

~~Rocky~~The ~~Mountain~~Company ~~High~~evaluates ~~Brands,~~intangible ~~Inc~~assets for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flow and recognizes an impairment loss when the estimated undiscounted future cash flow

~~Opinion on the Consolidated Financial Statements~~F-8

WeTable ~~have audited the accompanying consolidated balance sheet~~ of Rocky Mountain Brands, Inc. (the Company) as of December 31, 2017, and the related consolidated statement of operations, stockholders’ deficit, and cash flows for the six months ended December 31, 2017, and the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2017, and the results of its operations and its cash flows for the six months ended December 31, 2017, in conformity with accounting principles generally accepted in the United States of America.Contents

~~Basis~~expected ~~for~~to ~~Opinion~~result from the use of the asset plus the net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. When the Company identifies an impairment, it reduces the carrying amount of the asset to its estimated fair value based on a discounted cash flow approach or, when available and appropriate, to comparable market values. In August 2019 the Company recorded a $118,066 impairment on the intangible assets recorded as a result of the BFIT Brands, LLC acquisition in July 2018. The goodwill related to this acquisition is fully impaired. No other impairment charges were recorded during the years ended December 31, 2019 and 2018.

~~These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements~~ Share-based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.Payments

WeShare-based ~~conducted~~payments ~~our~~to ~~audits in accordance with~~employees, ~~the~~including ~~standards~~grants of ~~the~~employee ~~PCAOB.~~stock ~~Those~~options, ~~standards~~are ~~require~~recognized ~~that~~as wecompensation ~~plan~~expense ~~and~~in ~~perform~~ the ~~audit to obtain reasonable assurance about whether the consolidated~~ financial statements ~~are~~based ~~free~~on oftheir ~~material misstatement~~fair values, ~~whether~~in ~~due~~accordance towith ~~error~~FASB orASC ~~fraud~~Topic 718. ~~The~~That ~~Company~~expense is ~~not~~recognized ~~required to~~over ~~have,~~the ~~nor~~period ~~were~~during wewhich ~~engaged to perform,~~ an ~~audit~~employee ofis ~~its internal control over financial reporting. As part of our audits, we are~~ required to ~~obtain~~provide anservices ~~understanding~~in ofexchange ~~internal~~for ~~control~~the ~~over financial reporting~~award, ~~but~~known ~~not~~as ~~for~~ the ~~purpose~~requisite ofservice ~~expressing~~period an(usually ~~opinion on~~ the ~~effectiveness~~vesting ~~of the Company’s internal control over financial reporting~~period). ~~Accordingly, we express no such opinion.~~

~~Our~~The ~~audits~~Company ~~included~~issued ~~performing~~restricted ~~procedures~~stock to ~~assess~~consultants ~~the~~and ~~risks~~employees offor ~~material~~various ~~misstatement~~services. ofCost ~~the~~for ~~consolidated~~these ~~financial~~transactions ~~statements,~~are ~~whether~~measured ~~due~~at tothe ~~error~~fair orvalue ~~fraud,~~of ~~and~~the ~~performing~~consideration ~~procedures~~received ~~that~~or ~~respond~~the tofair ~~those~~value ~~risks.~~of ~~Such~~the ~~procedures~~equity ~~included~~instruments ~~examining~~issued, onwhichever ais ~~test~~more ~~basis,~~reliably ~~evidence~~measurable. ~~regarding~~The ~~the~~value ~~amounts~~of ~~and disclosures in~~ the ~~consolidated~~common ~~financial~~stock is ~~statements.~~to ~~Our~~be ~~audits~~measured ~~also~~at ~~included evaluating~~ the ~~accounting~~earlier ~~principles~~of ~~used~~(i) ~~and~~the ~~significant estimates~~date ~~made~~at bywhich ~~management,~~a asfirm ~~well~~commitment asfor ~~evaluating~~performance by the ~~overall~~counterparty ~~presentation~~to ofearn the ~~consolidated~~equity instruments ~~financial~~is ~~statements.~~reached Weor ~~believe that~~(ii) ~~our~~the ~~audits~~date ~~provide~~at awhich ~~reasonable~~the ~~basis~~counterparty's ~~for~~performance ~~our~~is ~~opinion~~complete.

~~The~~Convertible accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 3 to the consolidated financial statements, the Company has a shareholders’ deficit, an accumulated deficit, and a working capital deficit as of December 31, 2017, and has generated operating losses since inception. These factors, among others, raise substantial doubt regarding the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 3 to the accompanying financial statements. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.Instruments

~~/s/~~The ~~Paritz~~Company &evaluates ~~Company,~~and Paccounts for conversion options embedded in convertible instruments in accordance with ASC 815 “Derivatives and Hedging Activities.A.” Applicable WeGAAP ~~have~~requires ~~served~~companies to bifurcate conversion options from their host instruments and account for them as ~~the~~freestanding derivative ~~Company’s~~financial ~~auditor~~instruments ~~since~~according ~~2015~~to certain criteria. ~~Hackensack,~~The ~~New~~criteria ~~Jersey~~include ~~April~~circumstances 2in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, ~~2018~~(b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.

~~F-2~~The Company evaluates and accounts for the exchange or modification of an outstanding debt instrument as an extinguishment of that instrument when the original and new terms are substantially different as defined under ASC 470.

~~Table~~Preferred ~~of Contents~~Stock

~~Rocky~~We apply the guidance enumerated ~~Mountain~~in ~~High~~ASC ~~Brands~~480 “Distinguishing Liabilities from Equity” when determining the classification and measurement of preferred stock. Preferred shares subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. We classify conditionally redeemable preferred shares (if any), ~~Inc~~which includes preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control, as temporary equity. At all other times, we classified our preferred shares in stockholders’ equity. Our preferred shares do not feature any redemption rights within the holders’ control or conditional redemption features not within our control. Accordingly, unless otherwise noted, all issuances of preferred stock are presented as a component of consolidated stockholders’ equity (deficit).

~~Consolidated Balance~~Revenue ~~Sheets~~From Contracts with Customers

	December 31, 2018			December 31, 2017
CURRENT ASSETS
Cash	$	613,686		$	16,983
Accounts Receivable, net of allowance of $5,275 and $195,632, respectively		17,324			2,844
Inventory		146,722			82,312
Prepaid Expenses and Other Current Assets		388,074			634,722
TOTAL CURRENT ASSETS		1,165,806			736,861
Property and Equipment, net		34,280			35,681
Intangible Assets		148,647			—
Other Assets		26,245			29,093
TOTAL ASSETS	$	1,374,978		$	801,635
LIABILITIES AND SHAREHOLDERS' DEFICIT
CURRENT LIABILITIES
Accounts Payable and Accrued Liabilities	$	505,214		$	750,807
Related Party Convertible Notes Payable, net of debt discount		—			174,456
Convertible Notes Payable, net of debt discount		666,596			677,698
Notes Payable		37,493			549,936
Redemption Value of Series C Preferred Stock		—			—
Accrued Interest		25,758			81,248
Deferred Revenue		466,300			—
Derivative Liability		376,172			5,609,389
TOTAL CURRENT LIABILITIES		2,077,533			7,843,534
SHAREHOLDERS' DEFICIT
Preferred Stock - Series A - Par Value of $.001; 1,000,000 shares designated; No shares issued and outstanding as of December 31, 2018 and 1,000,000 shares issued and outstanding as of December 31, 2017		—			1,000
Preferred Stock - Series B - Par Value of $.001; 7,000,000 shares designated; No shares issued and outstanding as of December 31, 2018 and December 31, 2017		—			—
Preferred Stock - Series C - Par Value of $.001; 2,000,000 shares designated; No shares issued and outstanding as of December 31, 2018 and December 31, 2017		—			—
Preferred Stock - Series D - Par Value of $.001; 2,000,000 shares designated; No shares issued and outstanding as of December 31, 2018 and December 31, 2017		—			—
Preferred Stock - Series E - Par Value of $.001; 789,474 shares designated; No shares issued and outstanding as of December 31, 2018 and December 31, 2017		—			—
Common Stock - Par Value of $.001; 4,000,000,000 shares authorized as of December 31, 2018 and December 31, 2017; 1,891,617,372 shares issued and outstanding as of December 31, 2018; 1,159,706,457 shares issued and outstanding as of December 31, 2017		1,891,617			1,159,706
Additional Paid-In Capital		32,424,179			23,459,809
Accumulated Deficit		(35,018,351	)		(31,662,414)
TOTAL SHAREHOLDERS' DEFICIT		(702,555	)		(7,041,899)
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT	$	1,374,978		$	801,635

On January 1, 2018, the Company adopted ASU 2014-09, “Revenue from Contracts with Customers” and all the related amendments, which are also codified into ASC 606. The adoption of this guidance did not have a material effect on the Company’s financial position, results of operations or cash flows. The Company records revenue when persuasive evidence of an arrangement exists, product delivery has occurred, the selling price to the customer is fixed or determinable and collectability of the revenue is reasonably assured. No reserve for returns has been provided.

~~The Accompanying Notes are an Integral Part of the Consolidated Financial Statements~~F-9

~~F-3~~Table of Contents

~~Table~~The offollowing ~~Contents~~table represents sales by sales channel for the years ended December 31, 2019 and 2018:

Rocky Mountain High Brands, Inc.

	Year Ended
	December 31, 2019		December 31, 2018
Online	$	144,565	$	254,316
Distributor		26,610		78,853
Retailer		13,700		46,069
Private Label		20,375		—
Total	$	205,250	$	379,238

~~Consolidated~~All sales for all periods presented ~~Statements~~were to domestic customers, except the private label sales of ~~Operations~~$20,375 were to CBD Life of Mexico. This sale represents 10% of sales for the year ended December 31, 2019.

	Year Ended						Six Months Ended
	December 31, 2018			December 31, 2017			December 31, 2017			December 31, 2016
				(Unaudited)						(Unaudited)
Sales	$	379,238		$	141,289		$	59,653		$	320,338
Cost of Sales		385,673			132,216			79,933			98,639
Inventory Obsolescence		25,145			165,271			93,110			28,837
Gross Profit (Loss)		(31,580	)		(156,198	)		(113,390	)		192,862
Operating Expenses
General and Administrative		3,689,175			6,465,861			2,567,486			1,853,089
Advertising and Marketing		833,933			882,765			118,191			749,059
Impairment Expense		—			59,163			59,163			—
Total Operating Expenses		4,523,108			7,407,789			2,744,840			2,602,148
Loss from Operations		(4,554,688	)		(7,563,987	)		(2,858,230	)		(2,409,286)
Other (Income)/Expenses:
Interest Expense		1,275,693			2,700,221			2,054,438			398,648
(Gain) Loss on Extinguishment of Debt		191,138			(1,200,092	)		(1,200,092	)		—
(Gain) Loss on Change in Redemption Value of Series C Preferred Stock		—			(834,242	)		—			—
(Gain) Loss on Lawsuit Judgment and Legal Settlement		(689,724	)		—			—			—
(Gain) Loss on Change in Fair Value of Derivative Liability		(1,975,858	)		3,413,465			1,795,205			332,759
Total Other (Income) Expenses		(1,198,751	)		4,079,352			2,649,551			731,407
Loss Before Income Tax Provision		(3,355,937	)		(11,643,339	)		(5,507,781	)		(3,140,693)
Income Tax Provision		—			—			—			—
Net Loss	$	(3,355,937	)	$	(11,643,339	)	$	(5,507,781	)	$	(3,140,693)
Net Loss per Common Share - Basic and Diluted	$	(0.00	)	$	(0.01	)	$	(0.01	)	$	(0.00)
Weighted Average Shares Outstanding		1,605,719,345			813,528,472			855,469,994			629,289,895

Due to the nature of the Company’s revenue from contracts with customers, the Company does not have material contract assets or liabilities that fall under the scope of ASC 606.

The Company’s revenues accounted ~~Accompanying~~for ~~Notes~~under ASC 606, generally do not require significant estimates or judgments based on the nature of the Company’s revenue streams. The sales prices are angenerally ~~Integral~~fixed ~~Part~~at the point of sale and all consideration from contracts is included in the ~~Consolidated~~transaction price. ~~Financial~~The ~~Statements~~Company’s contracts do not include multiple performance obligations or material variable consideration.

FIn September 2019, the Company completed its initial production run and delivery of Green Lotus branded CBD-4infused canned beverages for its private label customer, Texas Wellness Center (“TWC”), a subsidiary of GL Brands, Inc. In late 2019, TWC informed the Company that some of the cans developed leaks and were unsaleable. Initially, TWC requested the Company rerun its production, but then requested a refund. In May 2020, the Company agreed to a settlement and release agreement whereby the Company agreed to issue 17,500,000 shares of common stock to TWC in exchange for mutual releases. The Company recorded this settlement in 2019 as a refund of the sales price of $322,000 that had been recorded as revenue in September 2019.

~~Table~~Advertising ofand ~~Contents~~Marketing

~~Rocky~~Advertising and marketing expenses ~~Mountain~~are ~~High~~charged ~~Brands,~~to ~~Inc~~operations as incurred.

~~Consolidated Statements~~Income ~~of Cash Flows~~Taxes

	Year Ended						Six Months Ended
	December 31, 2018			December 31, 2017			December 31, 2017			December 31, 2016
				(Unaudited)						(Unaudited)
Operating Activities:
Net Loss	$	(3,355,937	)	$	(11,643,339	)	$	(5,507,781	)	$	(3,140,693)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation		456,007			1,976,388			468,291			409,062
Stock-based payments to vendors		80,445			548,084			—			465,267
Warrants and options issued for services rendered		108,205			1,846,944			180,163			407,447
Non-cash interest expense		1,160,857			2,700,220			2,054,438			398,649
Fees and penalties on debt		120,251			729,929			729,929			—
Gain on change in redemption value of Series C Preferred Stock		—			(834,242	)		—			—
Gain on lawsuit judgment and legal settlement		(689,724	)		—			—			—
(Gain) Loss on change in fair value of derivative liability		(1,975,858	)		3,413,465			1,795,205			332,759
(Gain) Loss on extinguishment of debt		191,138			(1,200,092	)		(1,200,092	)		—
Bad debt expense		1,536			246,520			61,554			—
Loss on disposal of equipment		—			15,912			—			43,221
Depreciation and amortization expense		34,423			25,211			13,116			18,691
Impairment expense		—			59,163			59,163			—
Inventory obsolescence		25,145			165,271			93,110			28,837
Changes in operating assets and liabilities:
Accounts receivable		(16,017	)		13,064			(1,131	)		(242,052)
Inventory		(89,556	)		(29,312	)		49,273			43,260
Prepaid expenses		(22,076	)		(169,470	)		3,966			164,928
Other assets		(12,765	)		(7,569	)		(11,000	)		(3,431)
Accounts payable and accrued liabilities		(211,156	)		194,531			375,462			284,253
Deferred revenue		466,300			—			—			—
NET CASH USED IN OPERATING ACTIVITIES		(3,728,782	)		(1,949,322	)		(836,334	)		(789,802)
Investing Activities:
Investments in other assets		(31,220	)		(4,252	)		—			(39,774)
Cash acquired in business acquisition		15,612
Acquisition of property and equipment		(18,307	)		(10,705	)		(1,496	)		(36,635)
Disposal of property and equipment		—			832			832			—
NET CASH USED IN INVESTING ACTIVITIES		(33,915	)		(14,125	)		(664	)		(76,409)
Financing Activities:
Proceeds from issuance of convertible notes		877,500			590,000			220,000			330,000
Repayment of convertible notes		(172,932	)		—			—			—
Proceeds from issuance of related party convertible notes		—			289,000			100,000			100,600
Repayment of related party convertible notes		—			(25,000	)		—			—
Proceeds from issuance of notes payable		—			440,000			440,000			35,960
Repayment of notes payable		(14,672	)		(11,831	)		(6,194	)		(4,193)
Proceeds from issuance of common stock		3,669,504			543,200			8,500			456,650
NET CASH PROVIDED BY FINANCING ACTIVITIES		4,359,400			1,825,369			762,306			919,017
INCREASE (DECREASE) IN CASH		596,703			(138,078	)		(74,692	)		52,806
CASH - BEGINNING OF PERIOD		16,983			155,061			91,675			102,255
CASH - END OF PERIOD	$	613,686		$	16,983		$	16,983		$	155,061
Supplemental cash flow information:
Cash paid for interest	$	56,742		$	1,654		$	740		$	705
Cash paid for taxes	$	—		$	—		$	—		$	—
Supplemental disclosure of non-cash financing and investing activities:
Common stock issued for conversion of debt	$	4,000,604		$	3,056,572		$	3,055,140		$	188,023
Common stock issued for acquisition	$	75,000		$	—		$	—		$	—
Common stock issued as part of legal settlement	$	—		$	1,439,975		$	1,439,975		$	500,000
Debt and accrued interest converted for common stock	$	499,053		$	3,951,186		$	3,889,083		$	442,633
Derivative liability relieved upon conversion of related debt	$	3,021,935		$	5,310,518		$	5,276,018		$	318,125
Derivative liability incurred for debt discount	$	—		$	4,676,772		$	4,017,622		$	—
Beneficial conversion feature recognized as debt discount	$	1,351,790		$	—		$	—		$	212,771
Series C Preferred Stock redeemed for common stock	$	—		$	1,661,424		$	1,661,424		$	—

The Company uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. 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. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized.

~~The~~ASC Topic 740.10.30 clarifies the ~~Accompanying~~accounting ~~Notes~~for ~~are~~uncertainty in income taxes recognized in an ~~Integral~~enterprise’s ~~Part~~financial ofstatements and prescribes a recognition threshold and measurement attribute for the ~~Consolidated~~financial ~~Financial~~statement ~~Statements~~recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740.10.40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company has no material uncertain tax positions.

~~F-5~~Segments

~~Table~~The Company has determined that it operates one reportable operating segment. This determination was made based on the management approach, as described in FASB ASC 280, “Reportable Segments.” The management approach is based on an entity’s internal organization and the information that the chief operating decision maker uses to make decisions about operating matters. It also takes into consideration the nature of ~~Contents~~products, production processes, types and classes of customers, distribution methods, the Company’s regulatory environment, and whether discrete financial information is available for reportable segments.

~~Rocky Mountain~~Recently ~~High~~Issued ~~Brands, Inc.~~Accounting Pronouncements

~~Consolidated~~Unless otherwise noted, we have ~~Statement~~elected ofto ~~Shareholders'~~use ~~Deficit~~the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the ~~Year~~JOBS ~~Ended~~Act. ~~December~~This 31allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of our election, ~~2018~~our financial statements may not be comparable with other public companies.

	Common Stock					Preferred Stock A					Preferred Stock C			Preferred Stock E
	Shares			Amount		Shares			Amount		Shares		Amount	Shares		Amount		APIC		Accumulated Deficit			Equity/(Deficit)
Balance - December 31, 2017	1,159,706,457		$	1,159,706		1,000,000		$	1,000		—	$	—	—	$	—	$	23,459,809	$	(31,662,414	)	$	(7,041,899)
Shares issued for cash	386,051,448			386,051														3,283,452					3,669,503
Shares issued for compensation	13,597,469			13,598														144,589					158,187
Shares issued for stock option exercises	29,096,402			29,096																			29,096
Options issued for compensation	—			—														108,205					108,205
Shares issued upon conversion of convertible notes	289,370,558			289,370														3,731,895					4,021,265
Shares to vendors for services rendered	8,150,531			8,151														74,112					82,263
Shares issued for acquisition	7,462,688			7,463														67,537					75,000
Shares returned as part of lawsuit judgment and legal settlement	(1,818,181	)		(1,818	)	(1,000,000	)		(1,000	)													(2,818)
Beneficial conversion feature recognized on convertible notes payable	—			—														1,554,580					1,554,580
Net loss for the year ended December 31, 2018	—			—		—			—		—		—	—		—		—		(3,355,937	)		(3,355,937)
Balance - December 31, 2018	1,891,617,372		$	1,891,617		—		$	—		—	$	—	—	$	—	$	32,424,179	$	(35,018,351	)	$	(702,555)

F-10

~~Rocky Mountain~~Table ~~High~~of ~~Brands, Inc.~~Contents

~~Consolidated~~In February 2016, the Financial ~~Statement~~Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842), which requires lessees to recognize on the balance sheet a right-of-use ~~Shareholders'~~asset, ~~Deficit~~representing their right to use the underlying asset for the ~~Year~~lease ~~Ended~~term, ~~December~~and 31a lease liability for all leases with terms greater than 12 months. The guidance also requires qualitative and quantitative disclosures designed to assess the amount, ~~2017~~timing and uncertainty of cash flows arising from leases. The Company adopted Topic 842, as amended, on January 1, 2020. Upon adoption, the Company did not have any leases that would require recognition on the its consolidated balance sheet.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (~~Unaudited~~Topic 326), which requires the immediate recognition of management’s estimates of current and expected credit losses. ASU 2016-13 is effective for the Company beginning January 1, 2021. The Company is currently evaluating the potential impact of adopting this guidance on its financial statements.

	Common Stock				Preferred Stock A				Preferred Stock C				Preferred Stock E
	Shares		Amount		Shares		Amount		Shares		Amount		Shares			Amount			APIC		Accumulated Deficit			Equity/(Deficit)
Balance - December 31, 2016		735,080,314	$	735,081		1,000,000	$	1,000		—	$	—		—		$	—		$	14,727,383	$	(20,019,075	)	$	(4,555,611)
Shares issued for cash		24,682,293		24,682				—				—					—			518,518					543,200
Shares issued for compensation		700,550		701				—				—		789,474			789			29,570					31,060
Warrant exercise		1,500,000		1,500				—				—					—			33,000					34,500
Preferred shares converted to common shares		789,474		789										(789,474	)		(789	)		14,211					14,211
Shares issued upon conversion of convertible notes		323,331,050		323,330				—				—					—			3,872,003					4,195,333
Stock options issued to Board members and employees		—		—				—				—					—			1,642,127					1,642,127
Shares to vendors for services rendered		28,622,776		28,623				—				—					—			1,266,023					1,294,646
Shares issued as part of a legal settlement		45,000,000		45,000		—		—				—					—			1,356,975					1,401,975
Beneficial conversion feature recognized on convertible notes payable		—		—				—				—					—			—					—
Net loss for the year ended December 31, 2017		—		—		—		—		—		—		—			—			—		(11,643,339	)		(11,643,339)
Balance - December 31, 2017		1,159,706,457	$	1,159,706		1,000,000	$	1,000		—	$	—		—		$	—		$	23,459,809	$	(31,662,414	)	$	(7,041,899)

In May 2018, the FASB issued ASU 2018-09, Compensation-Stock Compensation: Scope of Modification Accounting. This ASU amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards an entity is required to apply modification accounting under ASC 718. This update is effective for the Company beginning January 1, 2021. The Company is currently evaluating the impact that ASU 2018-09 will have on its consolidated financial statements.

In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. The guidance ~~Accompanying~~is ~~Notes~~intended ~~are~~to anreduce ~~Integral~~the ~~Part~~complexity ofassociated with issuers’ accounting for share-based payment transactions for acquiring goods and services. The ASU is effective for the ~~Consolidated~~Company ~~Financial~~beginning ~~Statements~~January 1, 2022. The Company is currently evaluating the impact that ASU 2018-07 will have on its consolidated financial statements.

FIn July 2018, the FASB issued ASU 2018-611, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480): Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The guidance is intended to reduce the complexity associated with issuers’ accounting for certain financial instruments with characteristics of liabilities and equity. Specifically, a down round feature (as defined) would no longer cause a freestanding equity-linked financial instrument (or an embedded conversion option) to be accounted for as a derivative liability at fair value with changes in fair value recognized in current earnings. The amendments in this ASU are effective for the Company beginning January 1, 2020. Management does not believe that ASU 2018-11 will have a material impact on its consolidated financial statements.

~~Table~~In ofAugust ~~Contents~~2018, the FASB issued ASU 2018-13, Fair Value Measurements: Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement. This update modifies the disclosure requirements on fair value measurements in Topic 820. The ASU is effective for the Company beginning January 1, 2021. The Company is currently evaluating the impact that ASU 2018-13 will have on its consolidated financial statements.

~~Rocky Mountain~~ NOTE ~~High~~3 ~~Brands,~~– ~~Inc.~~Going Concern

~~Consolidated~~The accompanying financial statements ~~Statement~~have been prepared on a going concern basis, which contemplates the realization of ~~Shareholders'~~assets ~~Deficit~~and ~~for~~the satisfaction of liabilities in the ~~Six~~normal ~~Months~~course ~~Ended~~of business. The Company has a total shareholders’ deficit of $2,622,351 and an accumulated deficit of $40,285,145 as of December 31, ~~2017~~2019 and has generated operating losses since inception. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to generate revenues and its ability to continue raising capital.

	Common Stock				Preferred Stock A				Preferred Stock C				Preferred Stock E
	Shares		Amount		Shares		Amount		Shares		Amount		Shares			Amount			APIC		Accumulated Deficit			Equity/(Deficit)
Balance - June 30, 2017		786,525,118	$	786,525		1,000,000	$	1,000		—	$	—		—		$	—		$	18,062,830	$	(26,154,633	)	$	(7,304,278)
Shares issued for cash		500,000		500																8,000					8,500
Shares issued for compensation														789,474			789			14,211					15,000
Preferred shares converted to common shares		789,474		789										(789,474	)		(789	)							—
Stock options issued to Board members and employees																				179,116					179,116
Shares issued upon conversion of convertible notes		321,291,865		321,292																3,626,114					3,947,406
Stock options issued for services rendered		5,600,000		5,600																174,563					180,163
Shares issued as part of a legal settlement		45,000,000		45,000																1,394,975					1,439,975
Net loss for the six months ended December 31, 2017		—		—		—		—		—		—		—			—			—		(5,507,781	)		(5,507,781)
Balance - December 31, 2017		1,159,706,457	$	1,159,706		1,000,000	$	1,000		—	$	—		—		$	—		$	23,459,809	$	(31,662,414	)	$	(7,041,899)

F-11

~~Rocky Mountain~~Table ~~High~~of ~~Brands, Inc.~~Contents

~~Consolidated~~During 2019 the Company funded ~~Statement~~its operations with sales of ~~Shareholders'~~equity ~~Deficit~~and debt securities. The COVID-19 pandemic of 2020 has added uncertainty into the financial markets that the Company relies on for its operating and investment funding. It is unclear how long, or to what extent, the ~~Six~~pandemic ~~Months~~will ~~Ended~~impact the Company in 2020 and beyond. On April 30, 2020 the Company purchased certain assets of Raw Pharma, LLC (“Raw Pharma”) and agreed to sublease Raw Pharma’s production facility. Management believes its Securities Purchase Agreement dated December 3120, ~~2016~~2019 with GHS Investments, LLC (“GHS”), along with bridge financing from GHS or other sources, will provide sufficient funds to make up for any operating cash flows.

	Common Stock				Preferred Stock A				Preferred Stock C				Preferred Stock E
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		APIC		Accumulated Deficit			Equity/(Deficit)
Balance - June 30, 2016		537,989,764	$	537,990		1,000,000	$	1,000		—	$	—		—	$	—	$	12,366,476	$	(16,878,382	)	$	(3,972,916)
Shares issued for cash		41,485,294		41,485														415,165					456,650
Shares issued for compensation		11,933,557		11,934														399,330					411,264
Shares issued for services rendered		15,701,363		15,701														449,567					465,268
Shares issued upon conversion of convertible notes		75,761,502		75,762														112,261					188,023
Cashless warrant exercise		45,408,834		45,409														278,614					324,023
Shares issued as part of a legal settlement		6,800,000		6,800														493,199					499,999
Beneficial conversion feature on convertible related party notes payable																		212,771					212,771
Net loss for the six months ended December 31, 2016		—		—		—		—		—		—		—		—		—		(3,140,693	)		(3,140,693)
Balance - December 31, 2016		735,080,314	$	735,081		1,000,000	$	1,000		—	$	—		—	$	—	$	14,727,383	$	(20,019,075	)	$	(4,555,611)

The Company’s business has been adversely affected by the instability, disruption, and quarantine restrictions caused by the recent COVID-19 pandemic. The COVID-19 pandemic may cause customers to suspend their decisions on ordering our products, make it impossible to attend or sponsor trade shows or other conferences in which our products are presented to distributors, customers and potential customers, for our customers to visit our physical location, and give rise to sudden significant changes in regional and global economic conditions and cycles that could interfere with purchases of goods, or commitments to develop new brands and private label products.

~~The~~Significant disruptions to ~~Accompanying~~communications ~~Notes~~and ~~are~~travel, anincluding ~~Integral~~travel ~~Part~~restrictions ofand other protective quarantine measures against COVID-19 by governmental agencies, have increased the ~~Consolidated~~difficulty ~~Financial~~in ~~Statements~~delivering goods to our customers and could ultimately make such deliveries impossible. Travel restrictions and protective measures against COVID-19 could cause us to incur additional unexpected labor costs and expenses or could restrain our ability to retain the highly skilled personnel we need for our operations.

FThe COVID-719 pandemic has added uncertainty to the financial markets that the Company relies on for its operating and investment funding. It has also negatively impacted the Company’s ability to meet its external financial reporting deadlines.

~~Table~~NOTE of4 ~~Contents~~– Inventory

~~Rocky Mountain~~As ~~High~~of ~~Brands~~December 31, ~~Inc.~~ 2019 and December 31, 2018, inventory consists of the following:

Notes to Consolidated Financial Statements

	December 31, 2019		December 31, 2018
Finished inventory	$	160,763	$	84,730
Raw materials and packaging		77,272		61,992
Total	$	238,035	$	146,722

~~NOTE~~During the year ended December 31, 2019 the 1Company –recorded ~~General~~inventory obsolescence expense of $130,364 compared to $25,145 during the year ended December 31, 2018. In 2019 the obsolescence related to expired or unusable finished goods, ingredients, and packaging, primarily related to the FitWhey and Rocky Mountain High Brands. In August 2019 management determined the Company would suspend the production of water-based protein and caffeine-infused products, which had been produced under the FitWhey brand, until it develops a related hemp or CBD-infused product and/or brand. In 2018 the obsolescence expense related primarily to E-Juice and vape products that the Company no longer carries.

~~Rocky Mountain~~NOTE ~~High~~5 ~~Brands,~~– ~~Inc.~~Prepaid ~~(“RMHB” or the “Company”) is incorporated under the laws of the State of Nevada.~~Expenses ~~On July 17, 2014, the Company changed its name from Republic of Texas Brands Incorporated to Totally Hemp Crazy, Inc~~ and onOther ~~October 23,~~Current ~~2014, the Company changed its name to Rocky Mountain High Brands, Inc.~~Assets

~~RMHB currently~~As ~~operates~~of ~~through~~December ~~its parent company~~31, ~~three~~2019 ~~wholly-owned subsidiaries~~ and ~~one~~December 31, ~~minority-owned subsidiary~~2018, ~~which~~prepaid ~~the~~expenses ~~Company controls.~~and ~~All~~other ~~subsidiaries~~current ~~are~~assets ~~consolidated~~consists ~~for~~of ~~financial~~the ~~reporting purposes.~~following:

RMHB is a lifestyle brand management company that markets primarily CBD and hemp-infused products to health-conscious consumers. Our products span various categories including beverage, food, fitness, and skin care. RMHB also markets a naturally high alkaline spring water and a water-based protein drink with caffeine and B vitamins. All products comply with federal regulations on hemp products and contain 0.0% tetrahydrocannabinol (THC), the psychoactive constituent of cannabis.

	December 31, 2019		December 31, 2018
Prepaid officers’ compensation	$	143,233	$	291,617
Prepaid directors’ compensation		—		29,442
Prepaid marketing expenses		—		2,750
Other prepaid expenses and current assets		31,493		64,265
Total	$	174,726	$	388,074

~~In March~~During ~~2018,~~ the ~~Company~~years ~~launched~~ended ~~the~~December ~~HEMPd~~31, ~~brand~~2019 ~~with gummies~~and 2018, ~~water~~the ~~soluble~~Company ~~drops,~~recorded ~~capsules,~~amortization ~~tinctures,~~of ~~lotions,~~prepaid officers and ~~salves. The~~prepaid ~~Company~~directors’ ~~introduced~~compensation ~~four flavors~~ of ~~CBD-infused~~$177,824 ~~waters~~and in$268,724, respectively. 12The ~~oz.~~amortization ~~cans~~was inrecorded ~~November~~as ~~2018~~compensation expense.

~~In July~~During ~~2018~~the year ended December 31, 2019 the Company made a $156,000 production deposit with a beverage processor. The deposit was recorded as a prepaid asset. The Company later ~~acquired~~determined that the ~~assets~~processor ofwould ~~BFIT~~be ~~Brands,~~unable ~~LLC~~to complete the required production and ~~formed~~sought a ~~new~~refund ~~subsidiary,~~of ~~FitWhey~~the ~~Brands Inc~~deposit. ~~FitWhey markets~~The aprocessor ~~line-up~~returned $20,000 of ~~five~~the ~~water-based~~deposit ~~protein~~before ~~drinks~~filing ~~that~~for ~~include~~bankruptcy. ~~caffeine~~The Company has determined the prepaid asset is no longer recoverable and Bexpensed ~~vitamins~~the remaining $136,000 in 2019.

~~During 2017~~NOTE ~~and~~6 ~~2018,~~– ~~the~~Property ~~Company continued to market its lineup of naturally flavored hemp-infused functional beverages, as well as hemp-infused 2oz. Mango Energy Shots~~ and ~~Mixed Berry Energy Shots through the first half of 2018. The Company plans to introduce~~ ~~updated offerings of hemp seed extract-infused functional beverages in the second quarter of 2019 under the name of Rocky Mountain.~~Equipment

~~NOTE~~As of December 31, 2019 and December 231, –2018, ~~Summary~~property ofand ~~Significant~~equipment ~~Accounting~~consists ~~Policies~~of the following:

Principles of Consolidation

	December 31, 2019		December 31, 2018
Vehicles	$	14,687	$	29,598
Furniture and equipment		45,322		41,422
Personal computers		17,901		17,901
		77,910		88,921
Less: accumulated depreciation		58,568		54,641
Total	$	19,342	$	34,280

~~The consolidated~~NOTE ~~financial~~7 ~~statements~~– ~~have~~Intangible been prepared in accordance with generally accepted accounting principles in the United States. The consolidated financial statements include the accounts of the Company, its wholly-owned and controlled subsidiaries. All intercompany balances and transactions have been eliminated.Assets

~~Use~~As of December 31, 2019 and December 31, 2018, intangible assets consist of ~~Estimates~~the following:

The preparation of the financial statements in conformity with Generally Accepted Accounting Principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Certain of the Company’s estimates could be affected by external conditions, including those unique to its industry, and general economic conditions. It is possible that these external factors could have an effect on the Company’s estimates that could cause actual results to differ from its estimates. The Company re-evaluates all of its accounting estimates at least quarterly based on these conditions and record adjustments when necessary.

	December 31, 2019			December 31, 2018
Goodwill	$	—		$	86,142
Capitalized software		31,220			62,220
Formulas		—			12,500
Trade name		—			2,500
		31,220			163,362
Accumulated amortization		(18,212	)		(14,715)
Total	$	13,008		$	148,647

~~Cash~~In August 2019, the Company recorded an impairment expense of $118,066, which consisted of goodwill of $86,142, capitalized software of $31,000, formulas of $12,500, and trade name of $2,500, net of accumulated amortization of $14,076. These intangible assets were acquired in connection with the acquisition of FitWhey Brands Inc.

~~The Company~~NOTE ~~considers~~8 ~~all short-term highly liquid investments with an original maturity at the date of purchase of three months or~~– ~~less to be cash equivalents.~~Acquisitions

~~F-8~~FitWhey Brands Inc. (acquisition of the assets of BFIT Brands, LLC)

~~Table~~On July 25, 2018, the Company purchased the assets of ~~Contents~~BFIT Brands, LLC, an Arizona-based company. The acquired assets include the cash, accounts receivable, inventory, FitWhey trademark, recipes and formulas of BFIT’s FitWhey branded water-based protein drinks containing caffeine and a vitamin-B pack. The Company paid $230,438 including common stock issued to the owners of BFIT of $75,000, forgiveness of a note receivable of $80,000 plus accrued interest of $438, and $75,000 to be paid to the owners of BFIT over time based on 5% of net sales of FitWhey products. No liabilities were assumed by the Company in the transaction.

~~Accounts Receivable and Allowance for Doubtful Accounts Receivable~~F-12

~~The Company~~Table ~~has a policy~~ of reserving for uncollectible accounts based on the best estimate of the amount of probable credit losses in our existing accounts receivable. We extend credit to customers based on an evaluation of their financial condition and other factors. The Company generally does not require collateral or other security to support accounts receivable and perform ongoing credit evaluations of customers and maintain an allowance for potential bad debts if required.Contents

It is determined whether an allowance for doubtful accounts is required by evaluating specific accounts where information indicates the customers may have an inability to meet financial obligations. In these cases, we use assumptions and judgment, based on the best available facts and circumstances, to record a specific allowance for those customers against amounts due to reduce the receivable to the amount expected to be collected. These specific allowances are re-evaluated and adjusted as additional information is received. The ~~amounts~~purchase ~~calculated~~price ~~are analyzed to determine the total amount~~ of the ~~allowance.~~assets ~~The~~of ~~Company~~BFIT ~~may~~Brands, ~~also~~LLC ~~record~~assets awas ~~general~~allocated ~~allowance~~ as ~~necessary.~~follows:

Direct write-offs are taken in the period when we have exhausted our efforts to collect overdue and unpaid receivables or otherwise evaluate other circumstances that indicate the collectability of receivables.

Purchase Price
Common stock issued	$	75,000
Note payable and accrued interest forgiven		80,438
Earnout liability		75,000
Total	$	230,438

Allocation
Cash	$	15,612
Accounts receivable		5,763
Inventory		76,922
Software		31,000
Formulas		12,500
Trademark		2,500
Goodwill		86,141
Total	$	230,438

~~Inventories~~In August 2019 management determined the Company would suspend the production of water-based protein and caffeine-infused products until it develops a related hemp or CBD-infused product. As a result, the Company fully impaired the intangible assets related to its purchase of FitWhey. This resulted in an impairment charge of $118,066 for the December 31, 2019. Because all intangible assets were 100% impaired, it was determined that completion of an outside valuation was no longer necessary.

~~Inventories, which~~The ~~consist~~following ofrepresents the ~~Company’s~~unaudited pro ~~finished~~forma ~~products~~statement ~~held~~of ~~for~~operations ~~resale, raw materials, and packaging, are stated at the lower~~ of ~~cost, determined using~~ the ~~first-in,~~Company ~~first-out,~~for ~~and net realizable value. Net realizable value is~~ the ~~estimated~~year ~~selling price,~~ended inDecember ~~the ordinary course of business~~31, ~~less~~2018 ~~estimated~~had ~~costs~~FitWhey tobeen ~~dispose~~acquired ofon ~~the~~January ~~product.~~1, 2018:

If the Company identifies excess, obsolete or unsalable items, its inventories are written down to their realizable value in the period in which the impairment is first identified. Shipping and handling costs incurred for inventory purchases and product shipments are recorded in cost of sales in the Company’s statements of operations.

	Year Ended December 31, 2018
Sales	$	448,685
Cost of Sales		465,400
Inventory Obsolescence		25,145
Gross Loss		(41,860)
Operating Expenses		4,577,323
Loss From Operations		(4,619,183)
Other Expenses		535,142
Loss Before Income Tax Provision		(5,154,325)
Income Tax Provision		—
Net Loss	$	(5,154,325)
Net Loss Per Common Share-Basic and Diluted	$	(0.06)
Weighted Average Shares Outstanding		80,285,967

~~Fair Value Measurements~~F-13

~~The estimated~~NOTE ~~fair~~9 ~~value~~– ofAccounts ~~certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable~~Payable and ~~accrued~~Accrued expenses are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments. The carrying amounts of our short and long-term credit obligations approximate fair value because the effective yields on these obligations, which include contractual interest rates taken together with other features such as concurrent issuances of warrants and/or embedded conversion options, are comparable to rates of returns for instruments of similar credit risk.Liabilities

~~ASC 820~~As ~~defines~~of ~~fair~~December ~~value~~31, as2019 ~~the~~and ~~exchange price that would be received for an asset or paid to transfer a liability (an exit price)~~December in31, ~~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~~2018, ~~which~~accounts ~~requires~~payable anand ~~entity~~accrued toliabilities ~~maximize~~consist ~~the use~~ of ~~observable inputs and minimize~~ the ~~use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value~~following:

• Level 1 — quoted prices in active markets for identical assets or liabilities.

	December 31, 2019		December 31, 2018
Accounts payable	$	440,788	$	308,717
Accrued compensation		51,500		25,500
Common stock payable		417,850		12,356
Other accrued expenses		233,079		158,641
Total	$	1,143,217	$	505,214

•NOTE ~~Level~~10 2– —Related ~~quoted~~Party ~~prices for similar assets and liabilities in active markets or inputs that are observable.~~Payables

•During ~~Level~~2019, 3Charles —Smith, ~~inputs~~a ~~that~~member ~~are~~of ~~unobservable~~the Company’s ~~(for~~Board ~~example~~of ~~cash~~Directors ~~flow~~and ~~modeling~~its ~~inputs~~Chief ~~based~~Operating Officer, paid $30,406 to various vendors on ~~assumptions)~~behalf of the Company. As of December 31, 2019, this amount had not been repaid to Mr. Smith and is included in related party payables. There were no related party payables as of December 31, 2018.

~~The derivative~~NOTE ~~liability,~~11 ~~which~~– ~~relates to the conversion feature of convertible debt and common stock warrants and options, is classified~~Convertible asNotes ~~a Level 3 liability, and is the only financial liability measure at fair value on a recurring basis.~~Payable

~~The~~As of December 31, 2019 and December ~~change~~31, in2018, the ~~Level~~Company’s 3convertible ~~financial~~notes ~~instruments~~payable isconsists asof ~~follows~~the following:

Balance, June 30, 2017	$	5,072,579
	Interest Rates		Terms		Conversion Rates		December 31, 2019			December 31, 2018
Issued		4,017,623
GHS Investments, LLC (fixed conversion)		10%		.1-.75 years	$	0.02-0.03	$	1,035,750		$	871,079
Exercises/Conversions	$	(5,276,018)
LSW Holdings, LLC (variable conversion)		6%		—		(b)		179,000			179,000
Change in fair value recognized in operations	$	1,795,205
Discount								(205,800	)		(383,483)
Balance, December 31, 2017	$	5,609,389
Total							$	1,008,950		$	666,596
Issued	$	—
Exercises/Conversions	$	(3,257,359)
Change in fair value recognized in operations	$	(1,975,858)
Balance, December 31, 2018	$	376,172

~~F-9~~(a) 50% discount off the lowest trading price for the common stock during the 10 trading days prior to conversion ($0.011).

~~Table~~The Company has determined that the conversion feature embedded in the notes referred to above that contain a potential variable conversion amount constitutes a derivative which has been bifurcated from the note and recorded as a derivative liability, with a corresponding discount recorded to the associated debt. The excess of ~~Contents~~the derivative value over the face amount of the note is recorded immediately to interest expense at inception.

~~The~~During the year ended December ~~estimated~~31, ~~fair~~2019, ~~value~~the Company recognized a loss on extinguishment of ~~the~~debt ~~derivative~~of ~~instruments~~$172,910. ~~was~~On ~~valued~~May ~~using~~6, 2019 the ~~Black-Scholes~~Company ~~option~~and ~~pricing model~~GHS Investments, ~~using~~LLC (“GHS”) amended seven convertible notes payable to extend the ~~following~~due dates and change the ~~assumptions~~conversion asprice of ~~December~~each 31note. The Company recognized a loss on extinguishment of debt of $52,774 ~~2018~~related to these amendments. On November 27, 2019 and December 31, ~~2017:~~2019 the Company and GHS amended two convertible notes payable to extend the due dates and change the conversion price of each note. The Company recorded a loss on extinguishment of debt of $120,136 related to these amendments.

	December 31, 2018		December 31, 2017
Estimated dividends		None		None
Expected volatility		106%		165%
Risk free interest rate		2.41%		1.39%
Expected term		.1 to 4.0 years		1 to 4.8 years

During the year ended December 31, 2018, the Company recognized a loss on extinguishment of debt of $191,138 related to the conversions of variable conversion rate convertible notes.

~~Property~~As of December 31, 2019 and 2018, the Company’s derivate liability related to its convertible notes payable was $403,971 and ~~Equipment~~ $290,875, respectively.

~~Property and~~For ~~equipment~~the isyears ~~stated~~ended atDecember ~~cost~~31, 2019 ~~less~~and ~~accumulated~~2018, ~~depreciation.~~interest ~~Depreciation~~expense ~~is provided for~~ on athese ~~straight-line~~notes, ~~basis~~including ~~over~~amortization ~~the useful lives~~ of the ~~assets.~~discount, ~~Expenditures~~was ~~for~~$873,368, ~~additions~~ and ~~improvements~~$1,255,081, ~~are capitalized; repairs and maintenance are expensed as incurred~~respectively.

~~Impairment~~All tangible and intangible assets of ~~Long-Lived~~the ~~Assets~~Company are pledged as security.

~~The Company~~NOTE ~~evaluates~~12 ~~intangible~~– ~~assets~~Notes for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flow and recognizes an impairment loss when the estimated undiscounted future cash flow expected to result from the use of the asset plus the net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. When the Company identifies an impairment, it reduces the carrying amount of the asset to its estimated fair value based on a discounted cash flow approach or, when available and appropriate, to comparable market values. During the six months and year ended December 31, 2017 the Company recorded an impairment charge on the goodwill related to the acquisition of Rocky Mountain High Water Company in the amount of $59,163. As of December 31, 2018 and 2017, the goodwill related to this acquisition is fully impaired. No impairment charges were recorded during the year ended December 31, 2018.Payable

~~Share-based~~As of December 31, 2019 and December ~~Payments~~31, 2018, the Company’s notes payable consists of the following:

Share-based payments to employees, including grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values, in accordance with FASB ASC Topic 718. That expense is recognized over the period during which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting period).

		Interest Rates		Term				December 31, 2019				December 31, 2018
Notes payable		0% - 6%			Due			$	30,000			$	37,493

~~The Company~~As ~~issued~~of ~~restricted~~December ~~stock~~31, to2019 ~~consultants~~ and ~~employees for various services. Cost for these transactions are measured at~~2018, ~~the~~notes ~~fair~~payable ~~value~~includes oftwo ~~the~~non-interest ~~consideration~~bearing ~~received~~notes ortotaling ~~the fair value of the equity instruments issued~~$30,000 ~~whichever~~that isoriginated ~~more~~prior ~~reliably~~to ~~measurable. The value of~~ the ~~common~~Company’s ~~stock~~2014 isbankruptcy proceedings. toThese benotes ~~measured~~were atdue ~~the~~in ~~earlier~~2019, ofbut ~~(i)~~ the ~~date~~Company athas ~~which~~been aunable ~~firm commitment for performance by the counterparty~~ to ~~earn~~locate the ~~equity instruments is reached or (ii) the date at which the counterparty's performance is complete~~noteholders.

~~Convertible~~A three-year note executed on September ~~Instruments~~1, 2016 relating to the purchase of used office furniture and equipment from our landlord was paid in full on September 1, 2019. The note payable was in the amount of $40,122 at an interest rate of 0% and with monthly payments of $1,115. The Company imputed interest on the note and recorded a discounted note balance of $36,634 on September 1, 2016. As of December 31, 2018 the balance on this note was $7,493.

The Company evaluates and accounts for conversion options embedded in convertible instruments in accordance with ASC 815 “Derivatives and Hedging Activities.” Applicable GAAP requires companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not reF-measured at fair value under other GAAP with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument.14

~~Preferred Stock~~Table of Contents

~~We apply~~For the ~~guidance~~years ~~enumerated~~ended inDecember ~~ASC 480 “Distinguishing Liabilities from Equity” when determining the classification~~31, ~~and~~2019 ~~measurement of preferred stock. Preferred shares subject to mandatory redemption (if any) are classified as liability instruments~~ and ~~are measured at fair value. We classify conditionally redeemable preferred shares (if any)~~2018, ~~which includes preferred shares that feature redemption rights that are either within~~ the ~~control~~Company ofrecorded ~~the~~interest ~~holder~~expense oron ~~subject~~these tonotes ~~redemption upon the occurrence~~ of ~~uncertain~~ ~~events~~$214 ~~not~~and ~~solely within our control, as temporary equity~~$931. At all other times, we classified our preferred shares in stockholders’ equity. Our preferred shares do not feature any redemption rights within the holders’ control or conditional redemption features not within our control. Accordingly, unless otherwise noted, all issuances of preferred stock are presented as a component of consolidated stockholders’ equity (deficit).

~~F-10~~ NOTE 13 – Deferred Revenue

~~Table~~In December 2017, the Company executed a three-year Master Manufacturing Agreement with CBD Alimentos SA de CV (“CBD-Alimentos”), a Mexican food and beverage distributor. Under the agreement (as amended), CBD Alimentos, through its sister company, CBD Life, will be our exclusive distributor in Mexico for all of ~~Contents~~our CBD-infused energy and functional beverages. In turn, we will be CBD Alimentos’ exclusive supplier of such products. The beverages supplied to CBD Alimentos will be private label products made to order for CBD Alimentos, and we will cooperate on laboratory and taste-testing of each batch of beverages at the co-packing facility. In accordance with the Agreement, RMHB opened a separate operating bank account for all deposits made by CBD Alimentos towards the purchase of ingredients and packaging. CBD Alimentos is required to maintain a positive cash balance in the account at all times. The Company will have full unilateral authority to disburse funds from the bank account to vendors, suppliers, co-packers and the Company solely for the purposes of production and the Company’s margin on the sale. CBD Alimentos’ initial purchase order, including a deposit of $466,300 was received in December 2018. The initial deposit of $466,300 was accounted for as of December 31, 2018 as Deferred Revenue since production and delivery of the remaining finished product had not yet been completed. In December 2019, the Company began the manufacture and sale of beverage products to CBD Life and recorded the sale of the first truckload received by CBD Life for $20,375. As of December 31, 2019, the remaining balance of $445,925 is accounted for as Deferred Revenue.

~~Revenue From~~NOTE ~~Contracts~~14 ~~with~~– ~~Customers~~Shareholders’ Deficit

~~During~~Common the year ended December 31, 2017 the Company recognized revenue in accordance with ASC 605, “Revenue Recognition.” Revenue was considered realized or realizable and earned when all of the following criteria were met: (1) persuasive evidence of an arrangement exists, (2) product delivery has occurred, (3) the selling price to the customer is fixed or determinable, and (4) collectability of the revenue is reasonably assured.Stock

OnAs ~~January~~of 1December 31, ~~2018~~2019, the Company ~~adopted ASU~~ ~~2014-09~~has 200,000,000 ~~“Revenue~~shares ~~from~~of ~~Contracts~~common ~~with~~stock ~~Customers”~~authorized and ~~all~~137,914,630 ~~the~~shares ~~related~~issued ~~amendments,~~and ~~which~~outstanding. ~~are~~On ~~also~~April ~~codified~~22, ~~into~~2019 ~~ASC~~the ~~606.~~Company ~~The~~effected ~~adoption~~a of1-for-20 ~~this~~reverse ~~guidance~~stock ~~did~~split. ~~not~~All ~~have~~common ashare ~~material~~amounts ~~effect~~in onthis ~~the~~report ~~Company’s~~reflect ~~financial~~this ~~position,~~stock ~~results of operations or cash flows~~split.

~~The~~Effective ~~following~~March ~~table~~17, ~~represents~~2020 ~~sales~~the ~~by sales~~Board ~~channel~~of ~~for~~Directors ~~each~~approved an amendment to our Articles of Incorporation to increase the ~~periods:~~Company’s authorized common stock from 200,000,000 to 1,000,000,000 shares.

	Year Ended		Year Ended		Six Months Ended		Six Months Ended
	December 31, 2018		December 31, 2017		December 31, 2017		December 31, 2016
Online	$	254,316	$	84,404	$	40,646	$	9,610
Distributor		78,853		32,551		5,753		310,728
Retailer		46,069		24,334		13,254		—
Total	$	379,238	$	141,289	$	59,653	$	320,338

During the year ended December 31, 2019 the Company issued 43,333,761 shares of common stock, including 4,065,980 for convertible notes payable conversions, 25,403 for director and employee compensation, and 39,238,908 for cash. The Company also issued 3,470 rounding related shares in effecting the 1-for-20 reverse stock split.

~~All~~During ~~sales~~the year ended December 31, 2018 the Company issued 36,595,545 shares of common stock, including 14,468,528 for ~~all~~convertible ~~periods~~notes ~~presented~~payable conversions, 679,873 ~~were~~for todirector ~~domestic~~and ~~customers~~employee compensation, 1,454,820 for option exercises, 407,527 for vendor services rendered, 373,134 for the FitWhey acquisition, and 19,302,572 for cash. In September 2018, the Company also cancelled 90,909 shares of common stock as part of a legal settlement.

~~Due~~On toMarch 17, 2017, our Board of Directors approved the ~~nature~~Rocky Mountain High Brands, Inc. 2017 Incentive Plan (the “2017 Incentive Plan”). The purpose of the Incentive Plan is to provide a means for the Company’s ~~revenue~~to continue to attract, motivate and retain management, key employees, ~~from~~consultants ~~contracts~~and other independent contractors, and to provide these individuals with ~~customers~~greater incentive for their service to the Company by linking their interests in the Company’s success with those of the Company and its shareholders. Initially, the Board authorized 1,750,000 shares of the Company’s ~~does~~common ~~not~~stock ~~have~~to ~~material~~be ~~contract~~included ~~assets~~in orthe ~~liabilities~~Plan. ~~that~~The ~~fall~~Board ~~under~~of Directors awards these shares at its sole discretion. On July 14, 2017 the ~~scope~~Board of ~~ASC~~Directors increased the authorized shares in the 2017 Incentive ~~606~~Plan to 3,250,000. On December 19, 2017 the Board of Directors increased the authorized shares in the 2017 Incentive Plan to 5,000,000.

~~The~~Preferred Company’s revenues accounted for under ASC 606, generally, do not require significant estimates or judgments based on the nature of the Company’s revenue streams. The sales prices are generally fixed at the point of sale and all consideration from contracts is included in the transaction price. The Company’s contracts do not include multiple performance obligations or material variable consideration.Stock

~~Advertising~~As of December 31, 2019 the Company has 20,000,000 shares of Preferred Stock authorized and ~~Marketing~~12,801,154 designated through the various Series described below. The remaining 7,198,846 remain undesignated.

~~Advertising and marketing expenses are charged to operations as incurred.~~F-15

~~Income Taxes~~Table of Contents

~~The Company~~Series uses the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. 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. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A ~~valuation~~Preferred allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized.Stock

~~ASC Topic~~The ~~740.10.30~~Company ~~clarifies~~has the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740.10.40 provides guidance on derecognition1, ~~classification~~000,000 ~~interest~~shares ~~and~~of ~~penalties,~~Series ~~accounting~~A inPreferred ~~interim~~Stock ~~periods, disclosure and transition~~designated. ~~The Company has no material uncertain tax positions.~~

~~Segments~~From July 11, 2014 to February 28, 2017, our former Chairman of the Board held all of the1,000,000 shares of the Company’s Series A Preferred Stock. He transferred these shares to LSW Holdings, LLC (“LSW”) on February 28, 2017. As of December 31, 2017, LSW held all of these shares.

~~The~~On ~~Company~~March ~~has~~13, ~~determined~~2017, ~~that~~the Board of itDirectors ~~operates~~approved ~~one~~a ~~reportable~~Certificate ~~operating~~of ~~segment~~Designation for our Series A Preferred Stock. This ~~determination~~document ~~was~~revises ~~made~~and ~~based~~restates on the ~~management~~rights, preferences ~~approach~~and features of our Series A Preferred Stock, aswhich ~~described~~consists inof ~~FASB ASC~~1,000,000 ~~280~~shares, ~~“Reportable~~all ~~Segments~~of which are issued and outstanding.” Holders ~~The~~of ~~management~~our ~~approach~~Series isA ~~based~~Preferred onStock anwere ~~entity’s~~formerly ~~internal~~entitled ~~organization~~to cast 400 votes for every share held, and ~~the~~shares of Series A Preferred ~~information~~Stock ~~that~~were ~~the~~convertible ~~chief~~to ~~operating~~common ~~decision~~stock ~~maker~~at ~~uses~~a torate ~~make~~of ~~decisions~~100 ~~about~~shares ~~operating~~of ~~matters.~~common Itstock ~~also~~for ~~takes~~every ~~into~~share ~~consideration~~of Series A Preferred Stock. Following the ~~nature~~filing of ~~products,~~the ~~production~~Certificate ~~processes~~of Designation, ~~types~~holders ~~and~~of ~~classes~~Series ofA ~~customers,~~Preferred ~~distribution~~Stock ~~methods~~were entitled to cast 1,200 ~~the~~votes ~~Company’s~~for ~~regulatory~~every share ~~environment~~held, and ~~whether~~shares ~~discrete~~of ~~financial~~Series ~~information~~A isConvertible ~~available~~Preferred Stock are convertible to common stock at a rate of 1,200 shares of common stock for ~~reportable~~every ~~segments~~share of Series A Preferred Stock.

~~Recently~~On July 5, 2017, the Company again ~~Issued~~amended ~~Accounting~~the ~~Pronouncements~~Certificate of Designation for our Series A Preferred Stock. The amendment changed the conversion ratio of our Series A Preferred Stock from 1,200 shares of common stock for every share of Series A Preferred stock to 100 shares of common stock for every share of Series A Preferred Stock. The amendment was approved by the Company’s Board of Directors and LSW, the holder of our Series A Preferred Stock.

~~Unless otherwise~~On ~~noted~~July 24, we2017, ~~have elected to use~~ the ~~extended transition period for complying with new or revised accounting standards~~Company’s ~~under~~Board ~~Section 102(b)(1)~~ of ~~the~~Directors ~~JOBS~~approved ~~Act.~~an ~~This~~amendment ~~allows us~~ to ~~delay~~ the ~~adoption~~Certificate of ~~new~~Designation orfor ~~revised~~the ~~accounting~~Series ~~standards~~A ~~that~~Preferred ~~have different~~Stock ~~effective~~that ~~dates~~changed ~~for~~the ~~public~~voting rights ~~and~~back ~~private companies until those standards apply~~ to ~~private~~400 ~~companies.~~votes Asfrom ~~a result of our election~~1,200 ~~our~~for ~~financial~~every ~~statements~~share ~~may~~of ~~not~~Series beA ~~comparable~~Preferred ~~with other public companies~~Stock.

~~In February~~On ~~2016~~August 30, ~~the~~2018 ~~Financial~~in ~~Accounting~~the ~~Standards~~case ~~Board (“FASB”) issued Accounting Standards Update (“ASU”)~~entitled ~~2016-02,~~Rocky ~~Leases~~Mountain ~~(Topic~~High ~~840)~~Brands, ~~which~~Inc. ~~requires~~f/k/a ~~lessees~~Republic toof ~~recognize~~Texas onBrands, ~~the~~Inc. ~~balance~~Plaintiff, ~~sheet~~vs. aJerry ~~right-of-use asset~~Grisaffi, ~~representing their~~et ~~right~~al, toa ~~use~~judgment by the ~~underlying~~District ~~asset~~Court ~~for~~in ~~the~~Dallas ~~lease term~~County, ~~and~~Texas avoided ~~lease~~the ~~liability~~Series ~~for~~A ~~all~~Preferred ~~leases~~Stock ~~with~~ab ~~terms greater than 12 months~~initio. The ~~guidance~~shares ~~also~~were ~~requires~~cancelled ~~qualitative~~on ~~and quantitative disclosures designed to assess the amount~~October 26, ~~timing~~2018. ~~and~~As ~~uncertainty~~ of ~~cash flows~~December ~~arising from leases. ASU 2016-02 is effective for the Company beginning January 1~~31, ~~2020.~~2019 ~~The~~and ~~Company~~2018 isthere ~~currently~~are ~~evaluating the~~no ~~impact~~shares ~~that~~of ~~ASU~~Series ~~2016-02~~A ~~will~~Preferred ~~have~~Stock onissued ~~its~~and ~~consolidated financial statements~~outstanding.

~~In June~~Series ~~2016,~~B ~~the~~Preferred FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326), which requires the immediate recognition of management’s estimates of current and expected credit losses. ASU 2016-13 is effective for the Company beginning January 1, 2021. The Company is currently evaluating the potential impact of adopting this guidance on our financial statements.Stock

~~In January~~The ~~2017,~~Company ~~the~~has ~~FASB issued ASU 2017-01~~7, ~~Business Combinations: Clarifying the Definition of a Business (Topic 805)~~000, ~~which~~000 ~~clarifies the definition~~ shares of aSeries ~~business~~B ~~with~~Preferred ~~the~~Stock ~~objective~~designated ofand ~~adding~~none ~~guidance~~issued toand ~~assist~~outstanding ~~entities with evaluating whether transactions should be accounted for~~ as ~~acquisitions (or disposals)~~ of ~~assets~~December ~~or businesses. ASU 2017-01 is required to be applied prospectively and will be effective for the Company beginning January 1~~31, 2019. ~~The impact on our consolidated financial statements will depend on the facts~~ and ~~circumstances of any specific future transactions~~2018.

~~In May~~Series ~~2018,~~C ~~the~~Preferred ~~FASB issued ASU 2018-09, Compensation-~~Stock Compensation: Scope of Modification Accounting. This ASU amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards an entity is required to apply modification accounting under ASC 718. This update is effective for the Company beginning January 1, 2021. The Company is currently evaluating the impact that ASU 2018-09 will have on its consolidated financial statements.

~~In June~~The ~~2018,~~Company ~~the~~has ~~FASB issued ASU 2018-07~~2,000,000 ~~Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based~~shares ~~Payment~~of ~~Accounting.~~Series ~~The~~C ~~guidance~~Preferred isStock ~~intended~~designated toand ~~reduce~~none ~~the~~issued ~~complexity associated with issuers’ accounting for share-based payment transactions for acquiring goods~~ and ~~services.~~outstanding ~~The~~as ~~ASU~~of isDecember ~~effective for the Company beginning January 1~~31, ~~2022.~~2019 ~~The~~and ~~Company is currently evaluating the impact that ASU~~ 2018~~-07 will have on its consolidated financial statements~~.

~~In July~~Series ~~2018,~~D ~~the~~Preferred FASB issued ASU 2018-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480): Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The guidance is intended to reduce the complexity associated with issuers’ accounting for certain financial instruments with characteristics of liabilities and equity. Specifically, a down round feature (as defined) would no longer cause a freestanding equity-linked financial instrument (or an embedded conversion option) to be accounted for as a derivative liability at fair value with changes in fair value recognized in current earnings. The amendments in this ASU are effective for the Company beginning January 1, 2020. The Company is currently evaluating the impact that ASU 2018-11 will have on its consolidated financial statements.Stock

~~In August~~The ~~2018,~~Company ~~the~~has ~~FASB issued ASU 2018-13~~2,000,000 ~~Fair Value Measurements: Disclosure Framework Changes to the Disclosure Requirements~~shares ~~for~~of ~~Fair~~Series ~~Value~~D ~~Measurement.~~Preferred ~~This~~Stock ~~update~~designated ~~modifies~~and ~~the~~none ~~disclosure~~issued ~~requirements~~and onoutstanding ~~fair~~as ~~value~~of ~~measurements~~December ~~in Topic 820. The ASU is effective for the Company beginning January 1~~31, ~~2021.~~2019 ~~The~~and ~~Company is currently evaluating the impact that ASU~~ 2018~~-13 will have on its consolidated financial statements~~.

~~F-11~~Series E Preferred Stock

~~Table~~The Company has 789,474 shares of Series ~~Contents~~E Preferred Stock designated and none issued and outstanding as of December 31, 2019 and 2018.

~~NOTE 3 – Going Concern~~F-16

~~The accompanying~~Table ~~financial statements have been prepared on a going concern basis, which contemplates the realization~~ of assets and the satisfaction of liabilities in the normal course of business. The Company has a shareholders’ deficit of $702,555, an accumulated deficit of $35,018,351 as of December 31, 2018, and has generated operating losses since inception. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to generate revenues and its ability to continue raising capital from third parties.Contents

~~On June~~Series ~~27,~~F ~~2018,~~Preferred the Company entered into a Securities Purchase Agreement (“SPA”) with GHS Investments, LLC (“GHS”), which provides for GHS to purchase up to $15,000,000 of the Company’s common stock over a 24-month period based on a contractually agreed upon market discount. In October 2018 the Company began sales of common stock to GHS under the SPA. Management believes the SPA will provide sufficient cash flows until cash flows from operations become consistently positive.Stock

~~NOTE~~On December 20, 2019 the Board of 4Directors –designated ~~Inventory~~1,680 shares of Series F Preferred Stock. On that same day, the Company sold 130 shares of Series F Preferred Stock to GHS Investments, LLC (“GHS”) in accordance with a Securities Purchase Agreement with GHS. The Series F Preferred Stock has a par value of $.001, stated value of $1,200, accrues dividends at 12%, is convertible to common stock based on a 20-day trailing volume weighted average low share price, and is senior to other preferred stock. As of December 31, 2019 there were 130 shares issued and outstanding. There were no shares issued and outstanding as of December 31, 2018.

AsSeries ofG ~~December 31,~~Preferred ~~2018 and December 31, 2017, inventory consists of the following:~~Stock

	December 31, 2018		December 31, 2017
Finished inventory	$	84,730	$	77,517
Raw materials and packaging		61,992		4,795
Total	$	146,722	$	82,312

On December 20, 2019 the Board of Directors designated 10,000 shares of Series G Preferred Stock. On that same day, the Company granted 10,000 shares of Series G Preferred Stock to Charles Smith, a Board member and Chief Operating Officer of the Company, in exchange for $10,000 owed to Mr. Smith in compensation. The Series G Preferred Stock has a par value of $.001, is non-interest and non-dividend earning, and is convertible to common stock based on a 20-to-1 ratio. The holder of Series G Preferred Stock has the right to cast 20,000 votes for every one share of Series G Preferred Stock on any and all proposals to amend the Company’s Articles of Incorporation to increase the authorized capital stock of the Company. Mr. Smith exercised that right in December 2019 and the Series G Preferred Shares were converted to common stock in 2020. As of December 31, 2019 there were 10,000 shares issued and outstanding. There were no shares issued and outstanding as of December 31, 2018.

~~NOTE 5~~ Series –H ~~Prepaid~~Preferred ~~Expenses and Other Current Assets~~Stock

AsOn February 25, 2020 the Board of Directors designated 5,000 shares of ~~December~~Series 31H Preferred Stock. The Board amended the designation on April 7, ~~2018~~2020. ~~and~~The ~~December~~Series 31H Preferred Stock has a par value of $.001, ~~2017~~stated value of $1,200, ~~prepaid~~accrues ~~expenses~~dividends at 12%, and ~~other~~is ~~current~~convertible ~~assets~~to ~~consists~~common stock based on a 20-day trailing volume weighted average low share price. As of ~~the~~December 31, 2019 and 2018 there were no shares issued ~~following:~~and outstanding.

	December 31, 2018		December 31, 2017
Prepaid officers’ compensation	$	291,617	$	445,149
Prepaid directors’ compensation		29,442		147,207
Prepaid marketing expenses		2,750		13,750
Other prepaid expenses and current assets		64,265		28,616
Total	$	388,074	$	634,722

Warrants

~~NOTE~~During the year ended December 31, 62019, –the ~~Property~~Company granted no common stock warrants, none were exercised, and ~~Equipment~~25,000 were forfeited. As of December 31, 2019, there were 607,500 warrants outstanding. Exercise prices range from $.001 to $.02 per share.

AsDuring of the year ended December 31, 2018, the Company granted no common stock warrants and none were exercised or forfeited. As of December 31, ~~2017~~2018, ~~property~~there ~~and~~were ~~equipment~~632,500 warrants ~~consists~~outstanding. ofExercise ~~the~~prices ~~following:~~range from $.001 to $.02 per share.

		December 31, 2018		December 31, 2017
Vehicles	$	29,598	$	29,598
Furniture and equipment		41,422		42,538
Personal computers		17,901		2,379
		88,921		74,515
Less: accumulated depreciation		54,641		38,834
Total	$	34,280	$	35,681

Options

~~F-12~~During the year ended December 31, 2019, the Company issued 125,000 options to purchase common stock to an employee. The employee was terminated during 2019 and the options were forfeited prior to vesting. The options had a vesting schedule of 2 years and an exercise price of $.20. Also during 2019, former members of the Board of Directors and consultants forfeited 2,312,839 options to purchase common stock. As of December 31, 2019 are were no options issued and outstanding.

~~Table~~During the year ended December 31, 2018, the Company issued 678,339 options to purchase common stock. The options had an exercise price of ~~Contents~~$.06 and vested immediately. During the year ended December 31, 2018, 1,755,000 options were exercised and none were forfeited. As of December 31, 2018, there were 2,312,839 options issued and outstanding.

NOTE 7 15 – ~~Acquisitions~~Noncontrolling Interests

~~Rocky Mountain~~In ~~High~~July ~~Water~~2019, the Company invested $500 in Sweet Rock, LLC, a Michigan limited liability company. The Company holds a 51% ownership and Sweet Ally, Inc. (“Sweet Ally”) invested $495 for a 49% ownership. The Company consolidates the financial statements of Sweet Rock and accounts for Sweet Ally’s ownership as a noncontrolling interest. During the year ended December 31, 2019 Sweet Rock incurred marketing expenses of $8,398. This activity is included in the consolidated financial statements of the Company with corresponding noncontrolling interests.

~~In July 2016, the Company entered into a business alliance with Poafpybitty Family, LLC to launch Eagle Spirit Spring Water, a line of purified, high~~F-alkaline spring water sourced from Native American tribal land in Oklahoma. The agreement calls for the Company to pay a royalty on each gallon of water collected at the spring. Production of filtered spring water filled bottles commenced in August 2016 and sales began in October 2016. 17

~~In consideration~~Table ~~for the 20-year water and surface rights, and a related 10-year renewal option, the Company paid Poafpybitty Family, LLC cash payments~~ of ~~$22,500 and issued a warrant for 500,000 shares of the Company’s common stock exercisable at $.03 per share over a three-year period beginning July 27, 2016.~~Contents

~~The agreement~~NOTE ~~grants~~16 ~~the~~- Company an exclusive right to develop land adjacent to the spring for commercial purposes as agreed to by both parties. Additionally, the Company has agreed to grow hemp for experimental or commercial purposes on the land within three years.Concentrations

~~On November~~For ~~12, 2016,~~ the ~~agreement~~year ~~with~~ended ~~the~~December ~~Poafpybitty~~31, 2019, ~~Family was amended to give~~ the Company’s atwo ~~controlling~~largest ~~voting~~customers ~~interest~~represented ~~of 75~~10% ofand ~~WaterCo, while the Poafpybitty Family received 51~~7% of ~~the equity interest~~sales. ~~The~~For ~~amended agreement is being accounted for as a step-acquisition, with~~ the ~~resulting~~year ~~goodwill of $59,163 included in other assets. During the six months~~ ended December 31, ~~2017~~ 2018, the Company ~~obtained an outside valuation of the rights to use the land and obtain the water described in the agreement. As a result of that analysis and the continued operating losses by the Company~~’s ~~spring water business, the Company determined~~ ~~that~~two ~~its~~largest ~~investment,~~customers ~~including~~represented ~~the~~21% ~~related~~and ~~goodwill, was fully impaired. The Company recorded an impairment expense of $59,163 as of November~~ 12,% ~~2017. As a result~~ of ~~the step-acquisition, beginning on November 12, 2016 the operations of WaterCo are consolidated in the financial statements of RMHB~~sales.

~~FitWhey Brands~~ NOTE ~~Inc.~~17 ~~(acquisition~~– ofIncome ~~the assets of BFIT Brands, LLC)~~Taxes

~~On July 25, 2018, the Company purchased the assets of BFIT Brands, LLC, an Arizona-based company.~~ The ~~acquired~~reconciliation ~~assets include the cash, accounts receivable, inventory, FitWhey trademark, recipes and formulas~~ of ~~BFIT’s~~income ~~FitWhey branded water-based protein drinks containing caffeine~~tax ~~and~~benefit aat ~~vitamin-B~~the ~~pack~~U.S. ~~The~~statutory ~~Company~~rate ~~paid~~of ~~$230,438~~21% ~~including common stock issued~~ to the ~~owners~~Company’s ofeffective ~~BFIT~~rate offor ~~$75,000,~~the ~~forgiveness~~years ~~of a~~ended ~~note~~December ~~receivable of $80~~31,~~000~~ ~~plus~~2019 ~~accrued interest of $438,~~ and ~~$75,000 to be paid to the owners of BFIT over time based on 5% of net sales of FitWhey products. No liabilities were assumed by the Company in the transaction.~~2018:

The purchase price of the assets of BFIT Brands, LLC assets was preliminarily allocated as follows:

	Year Ended
	December 31, 2019			December 31, 2018
U.S federal statutory rate		(21	%)		(21%)
State income tax, net of federal benefit		(0.0	%)		(0.0%)
Increase in valuation allowance		21	%		21%
Income tax provision (benefit)		0.0	%		0.0%

Purchase Price
Common stock issued	$	75,000
Note payable and accrued interest forgiven		80,438
Earnout liability		75,000
Total	$	230,438
Allocation
Cash	$	15,612
Accounts receivable		5,763
Inventory		76,922
Software		31,000
Formulas		12,500
Trademark		2,500
Goodwill		86,141
Total	$	230,438

The tax effects of temporary differences that give rise to the Company’s net deferred tax liability as of December 31, 2019 and December 31, 2018 consist of the following:

The Company is obtaining an outside valuation of these assets.

Deferred Tax Assets	December 31, 2019			December 31, 2018
Net Operating Losses	$	4,620,000		$	3,990,000
Less: Valuation Allowance	$	(4,620,000	)	$	(3,990,000)
Deferred Tax Assets – Net		—			—

~~The following~~As ~~represents~~of ~~the~~December ~~unaudited~~31, ~~pro~~2019, ~~forma~~the Company ~~statement~~has approximately $22,000,000 of ~~operations~~federal and state net operating loss carryovers (“NOLs”), which begin to expire in 2028. Utilization of the ~~Company~~NOLs ~~for~~may be subject to limitation under the ~~year~~Internal ~~ended~~Revenue ~~December~~Code ~~31,~~Section ~~2018~~382 ~~had~~should ~~FitWhey~~there be a greater ~~been~~than ~~acquired~~50% onownership ~~January~~change 1,as ~~2018:~~determined under regulations.

	Year Ended December 31, 2018
Sales	$	448,685
Cost of Sales		465,400
Inventory Obsolescence		25,145
Gross Loss		(41,860)
Operating Expenses		4,577,323
Loss From Operations		(4,619,183)
Other Expenses		535,142
Loss Before Income Tax Provision		(5,154,325)
Income Tax Provision		—
Net Loss	$	(5,154,325)
Net Loss Per Common Share-Basic and Diluted	$	(0.00)
Weighted Average Shares Outstanding		1,605,719,345

In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the assessment, management has established a full valuation allowance against the entire deferred tax asset relating to NOLs for every period because it is more likely than not that all of the deferred tax asset will not be realized.

FOn December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Tax Act”) was signed into law making significant changes to the Internal Revenue Code. Changes include, but are not limited to, a federal corporate tax rate decrease from 35% to 21% for tax years beginning after December 31, 2017, the transition of U.S international taxation from a worldwide tax system to a territorial system, and a one-13time transition tax on the mandatory deemed repatriation of foreign earnings. We have estimated our provision for income taxes in accordance with the Tax Act and guidance available as of the date of this filing but have kept the full valuation allowance.

~~Table~~In assessing the realization of deferred ~~Contents~~tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the assessment, management has established a full valuation allowance against the entire deferred tax asset relating to NOLs for every period because it is more likely than not that all of the deferred tax asset will not be realized.

~~NOTE 8 – Accounts Payable and Accrued Liabilities~~F-18

~~As of~~Table ~~December 31, 2018 and December 31, 2017, accounts payable and accrued liabilities consist~~ of ~~the following:~~Contents

	December 31, 2018		December 31, 2017
Accounts payable	$	308,717	$	373,882
Accrued compensation		25,500		215,026
Other accrued expenses		170,997		161,899
Total	$	505,214	$	750,807

NOTE 18 – Commitments

~~NOTE 9~~Office ~~– Related Party Convertible Notes Payable~~Leases

AsThe Company executed a three-year oflease ~~December~~for 31corporate office space effective September 1, ~~2018~~2016. ~~and~~The ~~December~~lease 31included monthly payments of $7,715 ~~2017~~in year one, ~~the~~$7,972 in ~~Company’s~~year ~~related~~two, ~~party~~and ~~convertible~~$8,229 ~~notes~~in ~~payable consists~~year ofthree ~~the~~plus ~~following:~~common area maintenance. The lease was accounted for on a straight-line basis over its term.

	Interest Rate		Term		December 31, 2018		December 31, 2017
Related party convertible notes payable		6%		—	$	—	$	179,000
Discount						—		(4,544)
Total					$	—	$	174,456

On September 5, 2019 the Company executed a six-month extension of its corporate office lease at $8,065 per month plus common area maintenance. The lease expired on February 29, 2020.

~~As of~~On ~~December~~February 3128, ~~2017,~~2020 the ~~related party convertible notes include two notes payable to LSW Holdings, LLC (“LSW”)~~Company inexecuted ~~the~~a ~~amounts~~six-month extension of ~~$79,000~~its ~~and~~corporate ~~$100,000~~office lease. ~~They~~The ~~are~~lease ~~convertible~~includes tonew ~~shares~~space ofwithin the ~~Company’s~~same ~~common~~office ~~stock~~building at ~~50% of market price,~~a asmonthly ~~defined~~payment ~~in the notes payable agreements. These notes were reclassified to Convertible Notes Payable during 2018 upon the termination~~ of ~~Lily Li~~$3,549 ~~Executive~~per ~~Vice~~month ~~President,~~plus ~~who~~common isarea ~~also the managing partner of LSW~~maintenance.

~~The Company~~On ~~has~~January ~~determined~~18, ~~that~~2018, ~~the~~WFLC ~~conversion feature embedded in the notes referred to above that contain a potential variable conversion~~entered ~~amount~~into ~~constitutes~~ a ~~derivative~~12-month ~~which~~office ~~has~~use ~~been~~agreement ~~bifurcated~~for ~~from~~office ~~the~~space ~~note~~in ~~and recorded as a derivative liability~~Denver, ~~with~~Colorado. aMonthly ~~corresponding discount~~payments ~~recorded~~were ~~to the associated debt~~$91. The ~~excess~~lease ofautomatically ~~the derivative value over the face amount of the note is recorded immediately~~renews tofor ~~interest~~12 ~~expense~~months ateach ~~inception~~January. ~~For~~Monthly ~~the~~payments ~~years~~in ~~ended~~2019 ~~December~~were ~~31, 2018 and 2017 and the six months ended December 31, 2018 and 2017, the Company recorded interest expense of~~ $~~0, $0, $44,901 and $0, respectively, at the inception of the notes relating to the excess of derivative value over the face of the notes~~101..

~~For the~~Other years ended December 31, 2018 and 2017 and the six months ended December 31, 2018 and 2017, the Company recorded interest expense on these notes, including amortization of the discount, of $3,499, $345,239, $262,613 and $160,089, respectively.Leases

FThe Company rents storage space from various third parties on a month-14to-month basis.

~~Table~~Employee ~~of Contents~~Agreements

~~NOTE~~The Company has entered into 10employment –agreements ~~Convertible~~with ~~Notes~~the ~~Payable~~following Board members and officers:

AsIn 2014, the Company entered into ofa ~~December~~five-year 31employment agreement with David M. Seeberger, ~~2018~~Vice President and ~~December~~General 31Counsel. Under the agreement, ~~2017~~we agreed to compensate Mr. Seeberger at a rate of $120,000 per year and to bonus obligations based on the profitability of the Company’s. ~~convertible~~We ~~notes~~also ~~payable~~agreed ~~consists~~to grant Mr. Seeberger an option to purchase 2,000,000 shares of common stock for par value at any time after January 1, 2015. On February 1, 2018, the Company entered into a new three-year employment agreement with Mr. Seeberger. ~~following:~~The new agreement includes base compensation of $120,000 per year and discretionary bonuses as approved by the Board of Directors. On May 11, 2020 the Board of Directors appointed Mr. Seeberger as Chief Executive Officer and amended his contract to change his annual compensation to $150,000.

	Interest Rates			Terms		Conversion Rates		December 31, 2018			December 31, 2017
GHS Investments, LLC (fixed conversion)		10	%		.3-.6 years	$	0.005	$	871,079		$	—
GHS Investments, LLC (variable conversion)		8	%		—		(a)		—			182,545
LSW Holdings, LLC (variable conversion)		6	%		—		(b)		179,000			—
Other convertible notes (fixed conversion)		6%-8%			—		0.02-0.024
Other convertible notes (variable conversion)		8	%		—		(c)		—			844,450
Discount									(383,483	)		(349,297)
Total								$	666,596		$	677,698

In January 2016, the Company entered into a five-year employment agreement with Michael Welch, Chief Financial Officer. Under the agreement, we agreed to compensate Mr. Welch at a rate of $120,000 per year and to pay a bonus based on the profitability of the Company. Mr. Welch also became Chief Executive Officer on March 1, 2016. His salary was increased to $150,000 per year. In addition, Mr. Welch received 10,000,000 warrants for common stock at a price of $.001 on January 4, 2016 that were exercisable on July 25, 2016. On February 1, 2018, the Company entered into a new three-year employment agreement with Mr. Welch. The new agreement includes base compensation of $150,000 per year and discretionary bonuses as approved by the Board of Directors. On May 11, 2020 the Board of Directors appointed Mr. Welch as Chief Operating Officer and amended his contract to reflect the change in position.

~~(a) 50% discount~~On ~~off~~December 18, 2017, the ~~lowest~~Company entered ~~trading~~into ~~price~~a ~~for~~five-year ~~the~~employment agreement with John Blackington, Chief Commercialization Officer. The agreement includes base compensation of $140,000 per year, 7,000,000 common stock ~~during~~options, ~~the~~an 10annual ~~trading~~bonus ~~days~~of ~~prior~~up to ~~conversion~~30%, and discretionary bonuses as approved ~~($0~~by the Board of Directors.~~003)~~ The contract was terminated effective February 6, 2019.

~~(b) 50%~~On ~~discount~~February on1, 2018, the ~~average~~Company entered into a three-year employment agreement with Jens Mielke, Chief Financial Officer. The agreement includes base compensation of $140,000 per year and discretionary bonuses as approved by the 3Board ~~lowest~~of ~~closing~~Directors. ~~bid~~On ~~prices during~~May 11, 2020 the 10Board ~~trading~~of ~~days~~Directors ~~prior~~amended Mr. Mielke’s contract to ~~conversion~~ (change his annual compensation to $0150,000.~~008).~~

~~(c) 45% discount off the lowest trading price for the common stock during the 20 trading days prior to conversion ($0.003).~~ F-19

~~The Company~~Table has determined that the conversion feature embedded in the notes referred to above that contain a potential variable conversion amount constitutes a derivative which has been bifurcated from the note and recorded as a derivative liability, with a corresponding discount recorded to the associated debt. The excess of the derivative value over the face amount of the note is recorded immediately to interest expense at inception. For the years ended December 31, 2018 and 2017 and the six months ended December 31, 2018 and 2017, $0, $1,446,168, $1,179,140 and $0, respectively, was recorded at the inception of the notes relating to the excess of derivative value over the face of the notes.Contents

~~As of~~On ~~June~~February 301, ~~2017~~2018, ~~our former Chairman of~~ the ~~Board~~Company entered ~~held~~into ~~two~~a ~~notes~~three-year ~~payable~~employment agreement with ~~principal~~Charles ~~amounts of $200~~Smith,~~150~~ ~~and~~Chief ~~$184,300~~Operating Officer. The ~~$200,150~~ ~~note,~~agreement ~~which~~includes ~~was~~base ~~due~~compensation of ~~on December 19~~$120,000 ~~2017,~~per ~~converts~~year atand ~~50%~~discretionary ofbonuses ~~the~~as ~~average~~approved ofby the 3Board ~~lowest bid prices~~ of ~~the~~Directors. ~~common stock during the 10 days prior to the conversion~~Mr. ~~The~~Smith ~~$184,300~~resigned ~~note,~~his ~~which~~Board ~~was~~and ~~renewed through December 30, 2017, is convertible at~~Officer ~~$.01~~positions ~~with~~from ~~an anti-dilutive clause that becomes effective with any dilution of~~ the Company’s ~~common~~on ~~stock~~January ~~greater~~31, ~~than 1% of the shares outstanding at the time of split~~2020. ~~Both~~He ~~notes~~rejoined ~~accrue interest at 6%. During~~ the ~~six~~Board ~~months~~on ~~ended~~May ~~December 31~~11, ~~2017~~2020, ~~$384,450~~ ofbut ~~related~~does ~~party~~not ~~convertible~~have ~~notes payable were reclassified as convertible notes payable due to Mr. Grisaffi’s resignation. Both of Mr. Grisaffi’s convertible notes payable were voided by~~ a ~~District~~formal ~~Court in Dallas, County Texas in~~compensation ~~2018~~agreement ~~and~~with ~~were derecognized in~~ the ~~financial statements~~Company.

~~For the~~Other years ended December 31, 2018 and 2017 and the six months ended December 31, 2018 and 2017, interest expense on these notes, including amortization of the discount, was $1,255,081, $1,140,238, $543,164, and $77,743, respectively.Commitments

~~All tangible~~Under the terms of an Operating and ~~intangible~~Management ~~assets~~Agreement (as amended) with Poafpybitty Family, LLC, the Company is required to pay the greater of 3% of the sales of Rocky Mountain High Water Company ~~are~~or ~~pledged~~$30,000 as(adjusted ~~security~~annually for CPI% beginning in 2020) per year.

NOTE 11 19 – ~~Notes~~Legal ~~Payable~~Proceedings

AsRocky Mountain High Brands, Inc. ofv ~~December~~Lyonpride 31Music, ~~2018~~LLC, ~~and~~United ~~December~~States 31District Court Northern District of Texas, ~~2017~~3:18-cv-00045-C, ~~the~~now ~~Company’s~~Lyonpride ~~notes~~Music ~~payable~~LLC ~~consists~~v ofRocky Mountain High Brands, Inc., Before the ~~following:~~ American Arbitration Association, 01-18-0003-1428.

		Interest Rates		Term				December 31, 2018				December 31, 2017
Notes payable		0% - 6%			.7 –.8 years			$	37,493			$	549,936

The Company filed a suit against Lyonpride Music, LLC (“Lyonpride”) for fraud and for declaratory relief with respect to a contract between the parties. Lyonpride sought monetary damages from the Company for breach of contract and the Company sought monetary damages against Lyonpride. The parties have settled the matter and are in the process of finalizing settlement documents. The settlement documents have had to be modified because of the Covid 19 issue as a portion of the settlement relates to performance by Lyonpride and the scheduling of the performance has had to be extended.

~~As of~~Dallas ~~December~~County 31Texas, ~~2018,~~Case ~~notes payable includes three notes: two non~~Number DC-~~interest~~17-15441 ~~bearing~~filed ~~notes~~November ~~totaling $30~~8,~~000~~ ~~that~~2017. ~~originated~~Rocky ~~prior to~~Mountain ~~the~~High ~~Company’s~~Brands, ~~2014~~Inc. ~~bankruptcy proceedings and~~ f/k/a ~~three-year~~Republic ~~note~~of ~~executed~~Texas ~~on September 1~~Brands, ~~2016 relating to the purchase of used office furniture and equipment from our landlord~~Inc. ~~The Company executed the note payable in the amount of $40~~Plaintiff,~~122~~ atvs. anJerry ~~interest~~Grisaffi, ~~rate~~Joe ofRadcliffe, 0%LSW ~~and~~Holdings, ~~with~~LLC, ~~monthly~~Lily ~~payments of $1~~Li,~~115.~~ ~~The~~Epic ~~Company~~Group ~~imputed~~One, ~~interest~~LLC, onKenneth ~~the~~Radcliffe, ~~note~~Dennis ~~and~~Radcliffe, ~~recorded~~Phil aUhrik, ~~discounted note~~Michael ~~balance~~Radcliffe, ofFrank ~~$36~~Izzo,~~634~~ onMorgan ~~September 1~~Albright, ~~2016.~~John ~~The~~Garrison, ~~term~~BB ~~of the note is three years. As of December 31~~Winks, ~~2018 and 2017 and June 30~~LLC, ~~2017 the~~Crackerjack ~~balance on this note was $7~~Classic,~~493,~~ ~~$19~~LLC,~~936~~ and ~~$26~~Universal Consulting,~~130,~~ ~~respectively~~LLC.

~~On November~~The ~~30, 2017 the~~ Company ~~amended~~sought ~~two notes payable to GHS in~~ the ~~aggregate~~return ~~principal amount~~ of ~~$500,000. The notes, which~~ ~~were~~the ~~originally~~Series ~~made~~A onPreferred ~~October~~Stock 12(“Series ~~and~~A”) ~~November~~issued 2,to ~~2017~~Jerry ~~and~~Grisaffi ~~included conversion prices at 20% discount off market price~~(“Grisaffi”), asRMHB’s ~~defined~~former Chairman inof the ~~agreements~~Board. The ~~amendments removed the conversion features in the notes. Upon amendment, the~~ Company ~~recorded~~further ~~a loss on extinguishment of these notes of $15~~alleged,~~256.~~ Asamong ofother ~~December 31~~things, ~~2017~~that ~~the~~Grisaffi ~~notes,~~breached ~~which~~his ~~were~~fiduciary ~~previously~~duty ~~included in convertible notes payable are included in notes payable. The notes were amended~~ to ~~become~~the ~~convertible~~Company ~~notes~~by ~~in 2018 and as of December 31, 2018~~issuing ~~are~~these ~~included~~Series inA ~~convertible~~shares ~~notes~~to ~~payable~~himself.

~~For the~~On ~~years~~August ~~ended December 31~~30, 2018, ~~and~~the ~~2017~~Trial ~~and~~Court in the ~~six~~192nd ~~months~~District ~~ended~~Court ~~December~~of 31Dallas County, ~~2018~~Texas ~~and~~entered ~~2017,~~a final judgment in the Company’s ~~recorded~~favor ~~interest expense~~and onagainst ~~these~~Grisaffi in ~~notes~~the amount of $~~931~~3,500,000 $1for fraud,~~407,~~ ~~$493~~breach ~~and~~of ~~$710~~fiduciary duty, ~~respectively~~and conversion with respect to the Series A preferred stock. The Court further voided ab initio the Series A Preferred Shares. The Court further ruled that Grisaffi take nothing by his counterclaims in the case.

FIn The Court Of Appeals For The Fifth District Of Texas Dallas, Texas, Jerry Grisaffi, Appellant v. Rocky Mountain High Brands, Inc, f/k/a Republic of Texas Brands, Inc., Appellee, No. 05-1518-01020-CV.

~~Table~~Grisaffi appealed the Judgment described above. The Court of ~~Contents~~Appeals affirmed in part and reversed in part the Judgment and remanded it to the trial court for the purpose of the Company electing its remedy. The Company has elected its remedy of the $3,500,000 judgment against Grisaffi. Grisaffi has again appealed this matter. On November 19, 2019, Grisaffi filed a chapter 11 bankruptcy in the United States Bankruptcy Court for the Northern District of Texas, Case No. 19-33855-sgj. The Company has filed an Adversary Proceeding to deny Grisaffi the ability to discharge the judgment and has filed a motion to remove Grisaffi as the debtor in possession or to convert the case to a Chapter 7. The case has been converted by the Bankruptcy Court to a Chapter 7 case.

~~NOTE~~Dallas County Texas, Case Number 12DC-18-13491. –Rocky ~~Deferred~~Mountain ~~Revenue~~High Brands, Inc. f/k/a Republic of Texas Brands, Inc. Plaintiff, vs. Joe Radcliffe, LSW Holdings, LLC, Lily Li, Epic Group One, LLC, Kenneth Radcliffe, Dennis Radcliffe, Phil Uhrik, Michael Radcliffe, Frank Izzo, Morgan Albright, John Garrison, BB Winks, LLC, Crackerjack Classic, LLC, and Universal Consulting, LLC.

~~In December 2017, the Company executed a three~~F-year Master Manufacturing Agreement with CBD Alimentos SA de CV (“CBD-Alimentos”), a Mexican food and beverage distributor. Under the agreement (as amended), CBD Alimentos, through its sister company, CBD Life, will be our exclusive distributor in Mexico for all of our CBD-infused energy and functional beverages. In turn, we will be CBD Alimentos’ exclusive supplier of such products. The beverages supplied to CBD Alimentos will be private label products made to order for CBD Alimentos, and we will cooperate on laboratory and taste-testing of each batch of beverages at the co-packing facility. In accordance with the Agreement, RMHB opened a separate operating bank account for all deposits made by CBD Alimentos towards the purchase of ingredients and packaging. CBD Alimentos is required to maintain a positive cash balance in the account at all times. The Company will have full unilateral authority to disburse funds from the bank account to vendors, suppliers, co-packers and the Company solely for the purposes of production and the Company’s margin on the sale. CBD Alimentos’ initial purchase order, including a deposit of $466,300 was received in December 2018. The $466,300 is accounted for as Deferred Revenue as of December 31, 2018 as production and delivery of finished product had not yet been completed.20

~~NOTE 13~~Table –of ~~Shareholders’ Deficit~~Contents

~~Common~~This is the surviving case of the above case, having been severed on September 12, 2018. In this case, on August 12, 2019 the Court entered as Final Judgment, against Lily Li and LSW, holding that all Series A Preferred Shares in RMHB, including the shares issued to Grisaffi and later sold by him to LSW evidenced by Stock Certificate N0. 604 issued by RMHB, to LSW Holdings LLC in the amount of 1,000,000 shares, were void ab initio, and any potential rights thereunder were terminated. The Court further entered joint and several judgments against Lily Li and LSW Holdings LLC for $3,500,000, which was also joint and several with the Final Judgment against Grisaffi. This Final Judgment against Lily Li and LSW Holdings, LLC is final for all purposes and was not appealed. The Company plans to outsource the collection of this Judgment. The remaining Defendants settled with the Company by either returning shares of stock in the Company or paying a settlement sum to the Company which totaled $200,000. Other than collection of the Judgment this matter has been finalized.

~~As of~~Rocky ~~December~~Mountain 31High Brands, ~~2018~~Inc. v La Dolce Vita Trust and Christine Guthrie, ~~the~~In ~~Company~~Her ~~has~~Capacity 4As Trustee,~~000,000,000~~ ~~shares~~In ofThe ~~common~~382nd ~~stock~~District ~~authorized~~Court ~~and~~of 1Rockwall County,~~891~~ Texas,~~617,372~~ Cause ~~shares~~No. ~~issued and outstanding~~1-18-1608.

~~On March~~This ~~14,~~is ~~2017~~a case whereby the ~~Board~~Company is ofattempting ~~Directors~~to ~~and~~collect on the ~~holders~~Judgment ofobtained aagainst ~~majority~~Grisaffi. ofMore specifically the ~~voting~~Company ~~capital~~is ~~stock~~requesting ofthe Court to order the ~~Company~~La ~~increased~~Dolce Vita Trust to turnover fraudulently transferred assets and for additional relief necessary to enforce the Company’s ~~common~~judgment ~~stock~~against ~~authorization~~Grisaffi. ~~from~~Grisaffi ~~800,000,000~~is attempting to ~~950,000,000~~stay ~~and~~this oncase ~~September~~with 19his bankruptcy, ~~2017~~ the ~~authorization~~Company ~~was~~will ~~increased~~seek an order from the Bankruptcy Court to 4continue in this case,~~000,000,000~~ or will work in conjunction with the Trustee appointed in the Chapter 7 case on this ~~shares.~~matter

~~During the~~Chet ~~year~~– ~~ended~~5 ~~December 31~~Broadcasting, ~~2018 the Company issued 733,729,095 shares of common stock, including 289,370,558 for convertible~~ ~~notes~~Inc. ~~payable~~v ~~conversions,~~Rocky ~~13,597,469~~Mountain ~~for~~High ~~director and employee compensation~~Brands, 29Inc.,~~096,402~~ ~~for~~Supreme ~~option~~Court ~~exercises,~~of ~~8,150,531~~the ~~for vendor~~State ~~services~~of ~~rendered,~~New 7York,~~462,688~~ ~~for~~County ~~the~~of ~~FitWhey acquisition~~Ulster, ~~and~~Case ~~386,051,447 for cash~~No. ~~In September 2018, the Company also cancelled 1,818,180 shares of common stock as part of a legal settlement~~18-4416.

~~During the~~The ~~year~~Plaintiff ~~ended~~sued ~~December~~the 31Company, seeking ~~2017~~$21,000 ~~the~~in ~~Company~~damages ~~issued~~for ~~424,626,143~~breach ~~shares~~ of ~~common~~contract. ~~stock,~~The ~~including~~Company ~~323,331,050~~contested ~~for~~that ~~convertible notes~~claim ~~payable~~in ~~conversions,~~its ~~1,500,000~~entirety ~~for~~and ~~warrant~~filed ~~exercises,~~a ~~30,112,800~~counterclaim ~~for~~against the ~~services~~Plaintiff ~~rendered,~~for ~~45,000,000~~an asunspecified ~~part~~amount of adamages. ~~legal~~The ~~settlement, and~~parties ~~24,682,293~~have ~~for~~settled ~~cash~~this matter.

~~During the~~NOTE ~~six~~20 ~~months~~– ~~ended~~Other December 31, 2017 the Company issued 373,181,339 shares of common stock, including 321,291,865 for convertible notes payable conversions, 45,000,000 as part of a legal settlement, 789,474 for the conversion from Series E Preferred Shares, 5,600,000 for services rendered, and 500,000 for cash.Income/Expenses

~~During the~~Loss ~~six~~on ~~months ended December 31, 2016 the Company issued 197,090,550 shares~~ Extinguishment of ~~common stock for convertible notes payable conversions, warrant exercises, compensation, cash purchases, services rendered, and a legal settlement.~~Debt

~~On March~~For ~~17, 2017, our Board of Directors approved~~ the ~~Rocky~~year ~~Mountain~~ended ~~High~~December 31, ~~Brands~~2019, ~~Inc.~~the ~~2017~~Company ~~Incentive~~recorded ~~Plan~~a ~~(the~~loss ~~“2017~~on ~~Incentive Plan”).~~extinguishment ~~The~~of ~~purpose~~debt of ~~the~~$172,910 ~~Incentive~~related ~~Plan is~~ to ~~provide a means for~~ the ~~Company~~amendment ~~to continue to attract, motivate~~ and ~~retain management,~~settlement ~~key employees, consultants and other independent contractors, and to provide these individuals with greater incentive~~of ~~for~~convertible ~~their~~notes ~~service~~payable. toFor the ~~Company~~year byended ~~linking~~December ~~their~~31, ~~interests~~2018, in the Company’s ~~success~~recorded ~~with~~a ~~those~~net ofloss ~~the~~on ~~Company~~extinguishment ~~and~~of ~~its~~debt ~~shareholders.~~of ~~Initially~~$191,138 ~~the~~related ~~Board authorized 35,000,000 shares of the Company’s common stock~~ to ~~be included in~~ the ~~Plan.~~settlement ~~The Board~~ of ~~Directors~~ ~~awards~~convertible ~~these~~notes ~~shares at its sole discretion~~payable.

~~On July~~Gain ~~14,~~on ~~2017~~Lawsuit ~~the~~Judgment ~~Board~~and ~~of Directors increased the authorized shares in the 2017 Incentive Plan to 65,000,000.~~Legal Settlement

On During the year ended December 1931, 2019 ~~2017~~the Company recorded a net Gain on Lawsuit and Legal Settlement of $200,817. On May 30, 2019 the ~~Board~~Company recorded a gain on lawsuit judgment and legal settlement of ~~Directors~~$230,840 ~~increased~~related to the ~~authorized~~settlement ~~shares~~of ina lawsuit the Company filed in 2017 ~~Incentive~~against ~~Plan~~several todefendants. ~~100~~The settlement was reached on May 30, 2019 and included a $200,000 cash payment by the defendants to the Company, the forgiveness of debt of $30,840 owed by the Company to one of the defendants, and the return of 6,750,000 shares of common stock. In December 2019 the Company agreed to pay $30,023 to settle its lawsuit with LyonPride Music, LLC.

~~Preferred~~During the year ended December 31, 2018 the Company recorded a net Gain on Lawsuit and Legal Settlement of $689,724. In August 2018, the Company recorded a $654,289 gain related to the lawsuit judgment the Company received against Jerry Grisaffi, our former Chairman of the Board. The Company de-recognized two notes payable to Mr. Grisaffi, plus accrued interest, in the amount of $418,865, and de-recognized the related derivative liability of $235,424. In September 2018, the Company executed a settlement with Statewide Beverage and recorded a gain on legal settlement of $34,435. As part of the settlement, the Company received 1,818,180 of its common shares that had previously been issued to the owners of Statewide Beverage and cancelled them. The Company also recorded the extinguishment of liabilities that had been recorded at the time of the sale of product to Statewide Beverage in 2016. In November 2018, the Company recorded a gain related to the lawsuit judgment the Company received against LSW in the amount of $1,000 related to a court order to void the Series A Preferred Stock initially issued to the Company’s former Chairman of the Board and later purchased by LSW. The $1,000 gain represents the par value of the 1,000,000 shares cancelled.

As of December 31, 2018 the Company has 20,000,000 shares of Preferred Stock authorized and 12,789,474 designated through the various Series described below. The remaining 7,210,526 remain undesignated.F-21

~~F-16~~Table of Contents

~~Table~~Gain (Loss) on Change in Fair Value of ~~Contents~~Derivative Liability

~~Series~~For the year ended December A31, ~~Preferred~~2019, ~~Stock~~the Company recorded a loss on the change in fair value of derivative liability of $25,844 compared to a gain of $1,975,858 for the year ended December 31, 2018. In 2019 the loss resulted from the impact of a decrease in the price of the Company’s common stock and its impact on convertible debt, while in 2018 the gain resulted from the decrease in the price of the Company’s underlying stock, which is used to calculate the fair value of the related derivative liability, from the beginning of the year to the end of the year.

~~The Company~~ NOTE ~~has~~21 ~~1,000,000~~– ~~shares~~Subsequent ~~of Series A Preferred Stock designated.~~Events

~~From July~~Between ~~11,~~January ~~2014~~1 toand ~~February~~June 2819, ~~2017~~ 2020, ~~our~~the ~~former~~Company ~~Chairman~~issued of146,536,554 ~~the~~shares ~~Board~~of ~~held~~common ~~all~~stock, ofincluding ~~the1~~27,000,000 ~~shares~~for the acquisition of the ~~Company’s~~assets ~~Series~~of Raw APharma, ~~Preferred~~17,925,000 ~~Stock.~~for Helegal ~~transferred~~settlements, ~~these~~22,413,568 ~~shares~~for toconvertible ~~LSW~~notes ~~Holdings~~payable conversions, ~~LLC~~27,697,986 ~~(“LSW”)~~for ondirector ~~February~~and employee 28compensation, ~~2017.~~51,000,000 Asfor ofpayments ~~December~~to 31vendors, ~~2017~~ and 500,000 ~~LSW~~for ~~held~~the ~~all~~conversion of ~~these~~Series ~~shares~~G Preferred Stock to common stock.

~~On March~~Between ~~13,~~January ~~2017,~~1 ~~the Board of Directors approved a Certificate of Designation for our Series A Preferred Stock. This document revises~~ and ~~restates~~June ~~the rights~~19, ~~preferences and features of our Series A Preferred Stock, which consists of 1,000,000 shares, all of~~ ~~which are issued and outstanding. Holders of our Series A Preferred Stock were formerly entitled to cast 400 votes for every share held~~2020, ~~and shares of Series A Preferred Stock were convertible to common stock at a rate of 100 shares of common stock for every share of Series A Preferred Stock. Following~~ the ~~filing~~Company ofissued ~~the Certificate of Designation, holders of Series A Preferred Stock were entitled to cast 1,~~200 ~~votes for every share held, and~~ shares of Series AF ~~Convertible~~ Preferred Stock ~~are convertible to common stock at a rate of 1,200 shares of common stock~~ for ~~every share of Series A Preferred Stock~~cash.

~~On July~~Between 5,January ~~2017,~~1 ~~the~~and ~~Company~~June ~~again amended the Certificate of Designation for our Series A Preferred Stock. The amendment changed~~19, ~~the~~2020, ~~conversion~~holders ~~ratio~~ of ~~our~~convertible ~~Series~~notes Apayable ~~Preferred~~converted ~~Stock from 1~~$278,200 ~~shares~~ of ~~common~~outstanding ~~stock for every share of Series A Preferred stock to 100 shares of common stock for every share of Series A Preferred Stock~~principal. ~~The amendment was approved by the Company’s Board of Directors and LSW, the holder of our Series A Preferred Stock.~~

On ~~July~~ ~~24,~~February ~~2017~~19, 2020 the Company’s executed ~~Board~~a ofconvertible ~~Directors~~note ~~approved~~payable anwith ~~amendment~~Eagle toEquities, ~~the~~LLC ~~Certificate~~(“Eagle ofEquities”). ~~Designation~~The ~~for~~note ~~the~~has ~~Series~~a ~~A Preferred~~principal ~~Stock~~amount ~~that~~of $183,750, ~~changed~~bears ~~the~~interest ~~voting~~at ~~rights~~8%, ~~back~~is convertible to ~~400~~common ~~votes~~stock ~~from~~at ~~1,200~~a ~~for~~conversion ~~every~~rate ~~share~~ of ~~Series~~$.03, Aand ~~Preferred~~matures ~~Stock~~on August 19, 2021.

On ~~August~~ 30February 25, ~~2018~~2020 in the ~~case~~Board ~~entitled~~of Directors ~~Rocky~~designated ~~Mountain High Brands~~5,000 ~~Inc.~~shares ~~f/k/a Republic~~ of ~~Texas~~Series ~~Brands,~~H ~~Inc.~~Preferred ~~Plaintiff, vs~~Stock. ~~Jerry Grisaffi,~~The etBoard ~~al,~~amended athe ~~judgment~~designation byon ~~the~~April ~~District~~7, ~~Court~~2020. inOn ~~Dallas~~April ~~County~~7, 2020 ~~Texas voided~~ the ~~Series~~Company Aissued ~~Preferred~~11 ~~Stock ab initio. The~~ shares ~~were cancelled on October 26, 2018 and as~~ of ~~December~~Series ~~31,~~H ~~2018~~Preferred ~~are~~Stock nofor ~~longer issued and outstanding~~cash.

~~Series~~On February 28, 2020 the Company Bexecuted ~~Preferred~~a ~~Stock~~six-month extension of its corporate office lease. The lease includes new space within the same office building at a monthly payment of $3,549 per month plus common area maintenance.

~~The Company~~On ~~has~~March 713,~~000,000~~ ~~shares~~2020 ofthe ~~Series~~Company Bexchanged four ~~Preferred~~convertible ~~Stock~~notes ~~designated~~payable with maturity dates in February and ~~none~~March ~~outstanding~~2020 asfor four convertible notes with due dates of December 31 13, ~~2018,~~2020. ~~December~~All ~~31, 2017~~other ~~and~~terms ~~June~~are ~~30,~~the ~~2017~~same.

~~Series~~Effective March 17, 2020 the Board Cof ~~Preferred~~Directors ~~Stock~~approved an amendment to our Articles of Incorporation to increase the Company’s authorized common stock from 200,000,000 to 1,000,000,000 shares.

~~The Company~~On ~~amended~~March ~~its~~27, ~~Articles~~2020 ofthe ~~Incorporation~~Company asexecuted a ofconvertible ~~November~~note ~~13,~~payable ~~2015~~with toEagle ~~designate~~Equities. ~~2,000,000~~The ~~shares~~note ofhas ~~Series~~a Cprincipal ~~Preferred~~amount ~~Stock~~of $115, ~~which~~000, ~~are~~bears ~~12%~~ interest ~~bearing,~~at ~~cumulative~~8%, ~~exchangeable,~~is ~~non-voting,~~ convertible to ~~preferred~~common stock ofat ~~the~~a ~~Company.~~conversion ~~Each~~rate ~~Series C~~of ~~Preferred~~$.03, ~~share~~and ismatures ~~convertible~~on 50September ~~shares~~27, ~~of common stock~~2021.

On November 16, 2015, the holder of a convertible note aggregating $1,107,607 of principal and accrued interest, agreed to a dollar for dollar exchange for same number of Series C Preferred Stock shares. As of June 30, 2017, there were 1,107,607 shares of Series C Preferred shares outstanding and the related redemption value of these shares was classified as a current liability. On October 6, 2017, the Company and the holder reached a legal settlement whereby the Company agreed to an exchange of the Preferred C Stock back to the originating note payable in accordance with the terms of the Exchange Agreement. The holder then assigned the note to GHS in exchange for $1,000,000 consideration paid to him by GHS. As of December 31, 2018 and December 31, 2017, there are no Series C Preferred Stock shares outstanding. Interest expense recognized on these shares for the year ended December 31, 2017 and the six months ended December 31, 2017 and 2016 was $121,598, $43,506, $158,836, respectively.F-22

~~Series D~~Table ~~Preferred~~of ~~Stock~~Contents

~~The~~ On April 7, 2020 the Company ~~amended~~executed ~~its~~a ~~Articles~~three-year ofconsulting ~~Incorporation~~agreement with asEagle ofProcessing ~~March~~& 21Distribution, ~~2016~~Inc. (“EPD”). Under the agreement, EPD is to ~~designate~~provide 2outsourced services related to sales and distribution,~~000~~ marketing,~~000~~ ~~shares~~social ofmedia, ~~Series~~and Dwebsite ~~Preferred~~maintenance, ~~Stock~~logistics and order fulfillment, production, ainventory ~~non-voting~~management, ~~non-interest~~customer ~~bearing~~service, ~~convertible~~risk ~~preferred~~management, ~~stock~~and assistance with obtaining financing. ~~Each~~EPD ~~Series~~was Cgranted ~~preferred~~50,000,000 ~~share~~shares of iscommon ~~convertible~~stock toas ~~100~~compensation ~~shares~~for the first eight months of the contract with compensation for the remainder of the contract ~~common~~to ~~stock.~~be Asnegotiated prior to the end of ~~December~~the ~~31,~~initial ~~2018~~eight months. On June 30, ~~December~~2020 31EPD returned 25,000,000 ~~2017~~common ~~and~~shares ~~June~~of 30the previously issued 50,000,000 ~~2017~~shares pending the execution of an amendment to the April 7, ~~there~~2020 ~~are~~consulting noagreement. ~~Series~~These Dcommon ~~preferred~~shares have not been cancelled and are included in shares outstanding.

~~Series~~On April 21, 2020 the Company Efiled ~~Preferred~~a ~~Stock~~Registration on Form S-8 to register 600,000 shares of common stock issued to a vendor as compensation for services provided.

On ~~September~~ ~~19,~~April ~~2017~~29, 2020 the ~~Board~~Company offormed Rocky ~~Directors~~Mountain ~~designated~~Productions, aInc. ~~new~~(“RMPI”), ~~Series~~a Ewholly-owned ~~Preferred~~Nevada ~~Stock~~corporation. ~~Holders~~On ofApril ~~Series~~30, E2020, ~~Preferred~~RMPI ~~Stock~~purchased ~~are~~certain ~~entitled~~of tothe ~~cast~~assets 2of Raw Pharma,~~000~~ ~~votes~~LLC ~~per~~(“Raw ~~share~~Pharma”) ofincluding ~~Series~~machinery, Eequipment, ~~Preferred~~and ~~Stock~~fixtures. onThe ~~any~~facility ~~proposal~~has the capability to ~~increase~~can ~~our~~and ~~authorized~~bottle ~~capital stock~~product, ~~with no~~including ~~other~~12 ~~voting rights~~oz. ~~Series~~regular Eand ~~Preferred~~sleek ~~Stock~~cans, is16 ~~convertible~~oz. tocans, ~~common~~shots, ~~stock~~and ~~on a 1:1 basis~~bottles. OnThe ~~the~~purchase ~~same~~price for ~~day,~~ the ~~Board~~assets ~~granted Michael~~consists ~~Welch,~~of ~~Chairman~~a combination of ~~the~~$1,750,000 ~~Board~~in ~~789~~cash,~~474~~ 27,000,000 shares of ~~Series~~common ~~E Preferred~~ stock, asand ~~payment~~the ~~for~~assumption ~~his~~or ~~deferred~~refinancing of ~~compensation.~~Raw OnPharma’s ~~October 31,~~bank ~~2017,~~debts ~~Mr.~~secured ~~Welch~~by ~~converted~~equipment ~~his~~in ~~789,474~~the ~~shares~~amount of ~~Series~~$1,007,000. EThe ~~Preferred~~Company ~~Stock~~is toalso ~~789,474~~assuming ~~shares~~the oflease ~~common stock. As~~ of ~~December~~Raw ~~31,~~Pharma’s ~~2018~~20,000 ~~December~~square ~~31,~~foot ~~2017,~~facility ~~there~~and ~~are~~certain noequipment ~~shares~~leases. ofThe ~~Series~~Company Eassumed ~~Preferred~~no ~~Stock~~other ~~outstanding~~liabilities in the transaction.

~~F-17~~On April 29, 2020 the Company executed a $150,100 loan agreement with Comerica Bank under the Paycheck Protection Program (“PPP”) of the Small Business Administration (“SBA”). The loan bears interest at 1% and is due on April 29, 2022. If the Company meets certain PPP qualifications the loan will be forgiven by the SBA. Otherwise, monthly loan payments will commence November 1, 2020.

~~Table~~On May 12, 2020 the Company executed a Settlement Agreement and Release with Texas Wellness Center (“TWC”), a subsidiary of ~~Contents~~GL Brands, Inc., related to the 200,000 can production run the Company ran for TWC in September 2019. Pursuant to the Settlement Agreement the Company agreed to issue 17,500,000 shares of common stock, with a market value of $367,500, on the settlement date. As of December 31, 2019, the Company reversed the $322,000 previously recorded in September 2019, recorded a common stock payable of $367,500 and accrued a $15,000 payment made to TWC in January 2020 to assist with TWC’s customer service-related issues. The companies mutually released each other from all other liabilities, including a $75,000 account payable to TWC for CBD used in the manufacturing of the beverages. The companies further agreed that if RMHB files a lawsuit seeking damages against its can vendor, it would pay TWC 30% of any net recovery. RMHB is not required to take any further action.

~~Warrants~~On May 20, 2020 the Company executed a Release and Settlement Agreement with CHET-5 Broadcasting, Inc. (“CHET-5”) related to a breach of contract lawsuit filed by CHET-5 related to an advertising contract between the Company and CHET-5. The Company agreed to pay CHET-5 $9,000 in cash and 425,000 shares of common stock in exchange for full mutual releases.

During the year ended December 31, 2018, the Company granted no common stock warrants and none were exercised or forfeited. As of December 31, 2018, there were 12,650,000 warrants outstanding. Exercise prices range from $.001 to $.02 per share.F-23

~~During the~~Table ~~year ended December 31, 2017, the Company granted 12,150,000 common stock warrants and none were exercised. As part~~ of ~~a legal settlement, 55,096,825 warrants were returned to the Company and cancelled on October 6, 2017. As of December 31, 2017 there were 650,000 warrants outstanding.~~Contents

~~During the~~Item ~~six~~9. ~~months~~Changes ~~ended~~In ~~December 31, 2017, the Company granted 12,000,000 common stock warrants~~ and ~~none~~Disagreements ~~were~~with ~~exercised.~~Accountants Ason ~~part of~~Accounting ~~a legal settlement, 55,096,825 warrants were returned to the Company~~ and ~~cancelled~~Financial ~~on October 6, 2017.~~Disclosure

~~During the~~No ~~six~~events ~~months~~occurred ~~ended~~requiring ~~December~~disclosure under ~~31,~~Item ~~2016,~~307 ~~the~~and ~~Company~~308 ~~granted~~of ~~9,037,500~~Regulation ~~common~~S-K ~~stock~~during ~~warrants~~the ~~and~~year ~~38,026,204~~ended ~~were~~December ~~exercised~~31, 2019.

~~Options~~Item 9A. Controls and Procedures

~~During the~~As ~~year~~required ~~ended~~by ~~December~~Rule ~~31,~~13a-15 ~~2018,~~ under the ~~Company~~Securities ~~issued~~Exchange ~~13,566,768~~Act ~~options~~of to1934, ~~purchase~~we ~~common~~have ~~stock.~~carried ~~The~~out ~~options have~~ an ~~exercise price~~evaluation of ~~$.003~~the ~~and~~effectiveness ~~vested~~of ~~immediately.~~our ~~During~~disclosure ~~the~~controls ~~year~~and ~~ended~~procedures as of December 31, ~~2018,~~2019. ~~35,100,000~~This ~~options~~evaluation ~~were~~was ~~exercised~~carried ~~and~~out ~~none~~under ~~were forfeited.~~the Assupervision ofand ~~December~~with ~~31,~~the ~~2018,~~participation ~~there~~of ~~were~~our 46management,~~256,768~~ ~~options~~including our ~~outstanding.~~Chief ~~Exercise~~Executive ~~prices~~Officer ~~range~~and ~~from~~Chief ~~$.003~~Financial ~~to $~~Officer.~~045 per share.~~

~~During the~~Disclosure ~~year~~controls ~~ended~~and ~~December~~procedures are ~~31,~~controls ~~2017,~~and ~~the~~other ~~Company~~procedures ~~issued~~that ~~67,790,000~~are ~~options~~designed to ~~purchase~~ensure ~~common~~that ~~stock.~~information ~~The~~required ~~options~~to ~~have~~be andisclosed ~~exercise~~in our reports filed or ~~price~~submitted ~~ranging~~under ~~from~~the ~~$.003~~Securities toExchange ~~$.045~~Act of 1934 is recorded, processed, summarized and ~~vested~~reported, ~~immediately.~~within ~~During~~the time periods specified in the ~~year~~Securities ~~ended~~and ~~December~~Exchange ~~31,~~Commission’s ~~2017,~~rules noand ~~options~~forms. ~~were~~Disclosure ~~exercised~~controls and procedures include controls and procedures ~~none~~designed ~~were~~to ~~forfeited.~~ensure Asthat information required to be disclosed in our company’s reports filed under the Securities Exchange Act of ~~December~~1934 ~~31,~~is ~~2017,~~accumulated ~~there~~and ~~were~~communicated 67to management,~~790,000~~ ~~options~~including ~~outstanding.~~our ~~Exercise~~Chief ~~prices~~Executive ~~range~~Officer ~~from~~and ~~$.001~~Chief toFinancial ~~$.045~~Officer, to ~~per~~allow ~~share~~timely decisions regarding required disclosure.

~~During the~~Based ~~six~~upon ~~months~~that ~~ended~~evaluation, ~~December~~including our ~~31,~~Chief ~~2017,~~Executive ~~the~~Officer ~~Company~~and ~~issued~~Chief 39Financial Officer,~~440,000~~ ~~options~~we tohave ~~purchase~~concluded ~~common~~that ~~stock.~~our ~~The~~disclosure ~~options~~controls ~~have~~and anprocedures ~~exercise~~were ineffective ~~price~~as ~~ranging~~of ~~from~~the ~~$.001~~end ~~and~~of ~~$.003~~the ~~and~~period ~~vested~~covered ~~immediately~~by this annual report.

~~There were~~Management’s noReport ~~options~~on ~~granted~~Internal Control orover ~~outstanding~~Financial ~~during the six months ended December 31, 2016.~~Reporting

~~NOTE~~Our 14management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) ~~Concentrations~~under the Securities Exchange Act of 1934). Management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2019 based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. As a result of this assessment, management concluded that, as of December 31, 2019, our internal control over financial reporting was not effective. Our management identified the following material weaknesses in our internal control over financial reporting, which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines.

~~For~~We ~~the~~plan ~~year~~to ~~ended~~take ~~December~~steps ~~31,~~to ~~2018,~~enhance and improve the ~~Company’s~~design ~~two~~of ~~largest~~our ~~customers~~internal ~~represented~~control ~~12%~~over ~~and~~financial 7%reporting. ofDuring ~~sales~~the period covered by this annual report on Form 10-K, we have not been able to remediate the material weaknesses identified above. ~~For~~To remediate such weaknesses, we plan to implement the following changes during our year ~~ended~~ending December 31, ~~2017,~~2020: ~~the~~(i) ~~Company’s~~appoint additional qualified personnel to address inadequate ~~two~~segregation ~~largest~~of ~~customers~~duties ~~represented~~and ~~21%~~ineffective risk management; and ~~12%~~(ii) ofadopt ~~sales~~sufficient written policies and procedures for accounting and financial reporting. ~~For~~The ~~the~~remediation ~~six~~efforts ~~months~~set ~~ended~~out ~~December~~in ~~31,~~(i) ~~2017,~~and ~~the~~(ii) ~~Company’s~~are ~~two~~largely ~~largest~~dependent upon our securing additional financing ~~customers~~to ~~each~~cover ~~represented~~the 6%costs of ~~sales.~~implementing ~~For~~ the ~~six~~changes ~~months~~required. ~~ended~~If ~~December~~we ~~31,~~are ~~2016,~~unsuccessful ~~the~~in ~~Company’s~~securing ~~two~~such ~~largest~~funds, ~~customers~~remediation efforts may ~~represented~~be ~~75%~~adversely ~~and~~affected 1%in ofa ~~sales~~material manner.

FThis annual report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to an exemption for non-18accelerated filers set forth in Section 989G of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

~~Table~~Item of9B. ~~Contents~~Other Information

~~NOTE 15 – Income Taxes~~None.

The reconciliation of income tax benefit at the U.S. statutory rate of 21% to the Company’s effective rate for the year ended December 31, 2018, the year ended December 31, 2017, and the six months ended December 31, 2017 and 2016 is as follows:23

	Year Ended December 31, 2018			Year Ended December 31, 2017			Six Months Ended December 31, 2017		Six Months Ended December 31, 2016
U.S federal statutory rate		(21	%)		(34	%)		(34%)	(34%)
State income tax, net of federal benefit		(0.0	%)		(0.0	%)		(0.0%)	(0.0%)
Increase in valuation allowance		21	%		34	%		34%	34%
Income tax provision (benefit)		0.0	%		0.0	%		0.0%	0.0%

Table of Contents

~~The tax~~PART ~~effects of temporary differences that give rise to the Company’s net deferred tax liability as of December 31, 2018 and December 31, 2017 consist of the following:~~III

Deferred Tax Assets		December 31, 2018				December 31, 2017
Net Operating Losses		$	3,990,000			$	5,440,000

Filing Compare · Rocky Mountain High Brands, Inc.