Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

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

As of March 4, 2019,May 14, 2020 there were 136,965,896239,062,949 shares of the registrant’s common stock issued and outstanding.

See accompanying notes to the unaudited condensed consolidated financial statements.

See accompanying notes to the unaudited condensed consolidated financial statements.

See accompanying notes to the unaudited condensed consolidated financial statements.

See accompanying notes to the unaudited condensed consolidated financial statements.

See accompanying notes to the condensed consolidated unaudited financial statements.

See accompanying notes to the condensed consolidated unaudited financial statements.

 See accompanying notes to the condensed consolidated unaudited financial statements.

Canna Corporation

Notes to the Condensed Consolidated Financial Statements

SeptemberJune 30, 2018 2019

(Unaudited)

NOTE l: NATURE OF ORGANIZATION

Mining Power Group, Inc. formerly known as Rich Cigars, Inc.Canna Corporation (the "Company") was initially a Florida Corporation incorporated on July 29, 2013, and was established to manufacture and distribute high-quality, hand rolled, premium cigars under the Rich Cigars brand name. The Company had branded custom cigars to be sold via the internet and through retail locations. The Company's primary operations are currently through Northway Mining, LLC (a New York limited liability corporation) as a data center for third parties’ cryptomining processes located in New York State, in which the Company has a majority interest (55%) acquired on August 1, 2018. Management intends to conduct our business principally in the U.S.

Northway Mining, LLC’s (“NWM”), core business is providing hosting and security services for third parties’ cryptomining processes. These third parties offer security servicesprocesses, including continuous camera recording, night-vision, motion activation, and automatic text notification to onsite staff.

In November 2017, the Company underwent a change in control and became a Colorado corporation. As a result of this change, the Company changed the business name to Intercontinental Technology, Inc. in order to reflect a change in the Company's direction and overall strategy. The Company's strategic direction was to focus on the acquisition, development, and marketing of proprietary patented products that are readily marketable internationally, and at the same time, enterentering the business of cryptocurrency mining by the ownership of multiple cryptocurrency mining machines.

On December 26, 2017, the Company completed a reorganization. Rich Cigars, Inc., having been renamed to RCGR SUB, Inc., became a direct, wholly-owned subsidiary of a newly-formednewly formed Delaware corporation, First Intercontinental Technology, Inc., which. First Intercontinental Technology, Inc. was then considered the parent and is now the public entity. Additionally, another Delaware corporation was formed, Intercontinental Services, Inc. As of the effective date of the reorganization,merger, all outstanding shares of common stock and preferred stock of Rich Cigars, Inc. were automatically converted into identical shares of common stock or preferred stock in the parent on a one-for-one basis.

On February 16, 2018, the Company's Board of Directors voted to annul and vitiate the series of transactions in Delaware by filing certificates of correction with Delaware's Secretary of State. As a result, Intercontinental Technology, Inc. and First Intercontinental Technology, Inc. were dissolved and all ownership reverted back to equity shares in RCGR SUB, Inc. On February 21, 2018, the Company amended and restated itsthe Articles of Incorporationincorporation in order to change the Company's name from RCGR SUB, Inc. to Mining Power Group, Inc.

On April 4, 2019, the Company effected a name change in the State of Colorado from Mining Power Group, Inc. to “Canna Corporation” in preparation for a refocus of its business plan.  Similarly, the name change was filed in the State of Florida, where the Company’s headquarters are located.

NOTE 2: GOING CONCERN

These condensed consolidated 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 for the foreseeable future. As of SeptemberJune 30, 2018,2019, the Company has an accumulated deficit of $ 2,812,030$7,281,193 since inception. This raises substantial doubt about the Company's ability to continue as a going concern.

The extent of the impact of the coronavirus ("COVID-19") outbreak on the financial performance of the Company will depend on future developments, including the duration and spread of the outbreak and related advisories and restrictions, and the impact of COVID-19 on the overall economy, all of which are highly uncertain and cannot be predicted. If the overall economy is impacted for an extended period, the Company’s future operating results may be materially adversely affected.

Management's plans include raising capital through the equity markets to fund operations and eventually generate revenue through its business; however, there can be no assurance that the Company will be successful in such activities. These condensed consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classifications of the liabilities that might be necessary should the Company be unable to continue as a going concern.

NOTE 3: DISCONTINUED OPERATIONS

On November 27, 2017,As of June 30, 2019, the Company was under ongoing negotiation to transfer Northway Mining, LLC to a related party, who at the time of filing this 10Q was no longer a related party. Due to the foregoing, on July 1, 2019, the Company entered into certain Membership Interest Transfer Agreement and announced a Subscription Agreement with Mr. Dror Svorai,change in the current CEO ofstrategic focus by not continuing the Company, for the purchase of 1,000,000 shares of restricted Series A Convertible Preferred Supermajoritycryptocurrency business unit.

voting stock. Pursuant toAs a result of this agreement, the Company announced a shift, in the strategic focus by which the Company has recognizeddisclosed in the financials as Assets held-for-sale the amount of $1,455,047 and Liabilities held-for-sale in the amount of $ 2,345,861 reorganizing a cessation of itits business operations of Rich Cigarsfor Northway Mining, LLC, in accordance with Accounting Standards Codification (ASC) 205-20,Discontinued Operations.Operations. As such, the historical results of the CompanyNorthway Mining, LLC, have been classified as discontinued operations. As of the year ended December 31, 2017,2018, assets of discontinued operations consisted of property and equipment, of $498.cash and other assets, totals $1,590,992. As of December 31, 2018, liabilities of discontinued operations consisted of accounts payable and loans total $1,534,235.

Assets and liabilities held-for-sale as of June 30, 2019 and December 31,2018 consisted of the period ended September 30, 2018 all property and equipment was written off.following:

Results of the discontinued operations for the ninethree months and six months ended SeptemberJune 30, 2019 and 2018 and 2017 are as follows:are:

The following table provides supplemental cash flow information related to discontinued operations:

NOTE 4: SUMMARY OF SIGNIFICANT ACCOUNT POLICIES

Principles of Consolidation

The accompanying consolidated financial statements of Canna Corporation include its majority owned subsidiary Northway Mining, Power Group, Inc. (formerly Rich Cigars, Inc.) includesLLC. All significant intercompany accounts and transactions have been eliminated in consolidation.

The consolidated financial statements include the accounts of Mining Power GroupCanna Corporation and its subsidiary Northway Mining, LLC, which isare controlled and owned 55% by Mining Power Group, Inc.Canna Corporation.

All of the equity interests in Northway Mining not held by the Company are reflected as non-controlling interests. In the consolidated statements of operations, we allocate net income (loss) attributable to non-controlling interests to arrive at net income (loss) attributable to the Company.

Reclassification

Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. This change in classification does not materially affect previously reported cash flows from operations or from financing activities in the Statement of Cash Flows and had no effect on the previously reported Statement of Operations for any period. Currently, the Company presents the convertible Series A preferred stock as part of permanent equity instead of the mezzanine section of the balance sheet.

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared by the Company in accordance with Generally Accepted Accounting Principles ("GAAP")accounting principles generally accepted in the United States of America. America for interim financial statements and with the instructions to Form 10-Q and Regulation S-X of the United States Securities and Exchange Commission (“SEC”). Accordingly, they do not contain all information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements.

In the opinion of the Company’s management, the accompanying unaudited consolidated financial statements contain all the adjustments (which includenecessary (consisting only of normal recurring adjustments) necessaryaccruals) to present fairly the financial position of the Company as of June 30, 2019 and the

results of operations and cash flows have been made for the periods ended September 30, 2018 and 2017. Certain information and footnote disclosures normally included in financial statements are prepared in accordance with U.S. generally accepted accounting principles. The Company suggests these condensed financial statements be read in conjunction with the December 31, 2017 audited financial statements and notes thereto included in the Company's Form 10-K.presented. The results of operations for the periodsix months ended SeptemberJune 30, 20182019 are not necessarily indicative of the operating results for the full year.fiscal year or any future period. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the SEC on June 17, 2019.

The Company has elected a December 31 fiscal year-end.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAPGenerally Accepted Accounting Principles ("GAAP") in the United States of America requires management to adopt accounting policies and make estimates and assumptions that affect amounts reported in the consolidated financial statements.

Carrying Value, Recoverability and Impairment of Long-Lived Assets

The Company’s long-lived assets, which include property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Cash and Cash Equivalents

The Company considers all investments with a maturity date of three months or less when purchased to be cash equivalents. The Company had cash in the amount of $235,843$4,439 and $0 at September$183,347 as of June 30, 20182019 and December 31, 2017,2018, respectively.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded at the invoiced amount, net of an allowance for doubtful accounts. The Company performs on-going credit evaluations of its customers and adjusts credit limits based upon payment history and the customer’s current credit worthiness, as determined by the review of their current credit information; and determines the allowance for doubtful accounts based on historical write-off experience, customer-specificcustomer specific facts and general economic conditions that may affect a client’s ability to pay.

Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company determines when receivables are past due or delinquent based on how recently payments have been received. The Company set up an allowance for doubtfulhas net $0 in accounts receivable at June 30, 2019 and recorded $57,246 as bad debt expense.

December 31, 2018.

Cryptocurrencies

The Company receives cryptocurrencies from its customers as a form of payment and converts them into cash in less than 3 months from receipt. The Company accounts for its cryptocurrencies as indefinite-lived intangible assets at historical losscost less impairment in accordance with ASC 350Intangibles - Goodwill and Other. AsOther. During the six months ended June 30, 2019 and 2018, the Company recorded impairment losses of September$6,189 and $0, respectively, resulting in cryptocurrency balances of $0 and $6,189 as of June 30, 20182019 and December 31, 2017, the fair value of cryptocurrencies was $239,016 and $0, respectively, which resulted in impairment loss of $26,028 and $0 for the nine months ended September 30, 2018, and 2017, respectively.

Property and Equipment

Property and equipment is recorded at cost. Expenditures for major additions and betterments are capitalized.

Maintenance and repairs are charged to operations as incurred. Depreciation of property and equipment is computed by the straight-line method (after taking into account their respective estimated residual values shown in the table below) over the estimated useful lives of the respective assets.

Upon the sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in statements of operations. During the six months ended June 30, 2019 and 2018, the Company purchased $103,805 and $0, respectively, of fixed assets, wrote off $0 and $498, respectively, of fixed assets, and recorded $57,248 and $0, respectively, of depreciation expense, resulting in net fixed assets of $1,455,047 and $1,408,490 at June 30, 2019 and December 31, 2018, respectively, which are reflected as assets held-for-sale and discontinued operations (Note 3) in the accompanying financial statements as follows:

Deferred revenue

The Company recognizes revenue for subscription hosting service sales over the subscription period. Deferredperiod and deferred revenue is recorded for the portion of the subscription period subsequent to each reporting date, for which cash has already been received.date. As of SeptemberJune 30, 20182019 and December 31, 2017,2018, the amountbalances of deferred revenue was $599,238were $255,362 and $0, respectively.

Loans Payable

The Company within the acquisition of Northway Mining LLC in August 1, 2018, acquired also certain real estate and vehicles, the unpaid balances on the two propertiesareguaranteed by mortgages having basic payment terms and conditions as follows: 707 Flats Road payable after 180 days from August 15, 2018, no interest and 2 Flint Mine Road with a 12 months payment period, and a maturity date on September 1, 2019, 5% interest rate. The unpaid balances on vehicles are guaranteed with a lien 72 month maturity since August 24, 2018 and October 5, 2018$275,362, respectively. The decreased amount is a result of mortgages as of September$20,000 refunded to a customer. No services were performed to clients during the six months ended June 30, 2018 is $714,9002019 related to the deferred revenue, which is payable over a twelve month period. The debt on vehicles is deferred as follows: (a) $42,223 payable within a 12-month period following September 30, 2018 (current portion), and (b) $86,582 payable during 2020 through 2023 (non-current portion), as detailedincluded in the following chart. These loans have a lien on the vehicles, and the interest rate for Community Bank is 5.79% and 1^st Bank of Scotia is 7.29%liabilities held-for-sale (Note 3).

Beneficial Conversion Feature

If the conversion features of conventional convertible debt provide for a rate of conversion that is below market value at issuance, this feature is characterized as a beneficial conversion feature ("BCF"). A Beneficial Conversion FeatureBCF is recorded by the Company as a debt discount pursuant to ASC 470-20Debt with Conversion and Other Options.In those circumstances, the convertible debt is recorded net of the discount related to the BCF, and the Company amortizes the discount to interest expense over the life of the debt using the effective interest method.

Embedded Conversion Features

The Company evaluates embedded conversion features within convertible debt under ASC 815Derivatives and Hedging to determine whether the embedded conversion feature(s) should be bifurcated from the host instrument and accounted for as a derivative at fair value with changes in fair value recorded in earnings. If the conversion feature does not require derivative treatment under ASC 815, the instrument is evaluated under ASC 470-20Debt with Conversion and Other Optionsfor consideration of any beneficial conversion features.

Derivative Financial Instruments

Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments, and measurement of their fair value for accounting purposes. In determining the appropriate fair value, the Company uses the Black ScholesBlack-Scholes option-pricing model. In assessing the convertible debt instruments,

management determines if the convertible debt host instrument is conventional convertible debt and, further, if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.

Once determined, derivative liabilities are adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recorded in results of operations as an adjustment to fair value of derivatives. In addition, the fair value of freestanding derivative instruments such as warrants, are also valued using the Black Scholes option-pricing model.

Fair Value of Financial Instruments

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on our principal or, in the absence of a principal, most advantageous market for the specific asset or liability.

U.S. generally accepted accounting principles provide for a three-level hierarchy of inputs to valuation techniques used to measure fair value, defined as follows:

Level 1: Inputs that are quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity can access.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability, including:

● quoted prices for similar assets or liabilities in active markets;

● quoted prices for identical or similar assets or liabilities in markets that are not active;

● inputs other than quoted prices that are observable for the asset or liability; and

● inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3: Inputs that are unobservable and reflect management’s own assumptions about the inputs market participants would use in pricing the asset or liability based on the best information available in the circumstances (e.g., internally derived assumptions surrounding the timing and amount of expected cash flows).

Our financial instruments consist of cash, accounts receivable, accounts payable, and debt. We have determined that the book value of our outstanding financial instruments as of SeptemberJune 30, 20182019 and December 31, 2017,2018, approximates the fair value due to their short-term nature.

Items recorded or measured at fair value on a recurring basis in the accompanying consolidated financial statements consisted of the following items as of SeptemberDecember 31, 2018 and June 30, 2018:2019:

The Company reflects the fair value of derivativefor liabilities using the Black Scholes pricing model. The following chart arediscloses the estimated fair values for the Company’s derivative financial instruments and based on the parameters disclosed in our Notes 5 and 6 hereto:

Revenue Recognition

Effective January 1, 2018, the Company adopted the Financial Accounting Standards Board (“FASB”) standard update ASU 2014-09,Revenue “Revenue from Contracts with Customers,” (“Topic 606”) which provides a principles-based, five-step approach to measure and recognize revenue from contracts with customers. Revenue is recognized when the following criteria are met:

The adoption of this guidance did not have a material impact on the Company’s consolidated statementstatements of operations, cash flows, andshareholders’ equity (deficit), or balance sheetsheets as of the adoption date or fordate.

The Company did not generate any revenues during the ninesix months ended SeptemberJune 30, 2019. Revenues generated during the six months ended June 30, 2018 or 2017.

The Company's revenues have been generated primarily through hosting services to third parties. The termstotaled $10,392 and were included in net loss from discontinued operations in the accompanying statements of these agreements generally consist of a deposit and monthly billing cycles covering our services.  

For the nine months ended September 30, 2018, all agreements met the above criteria, or in exceptional cases only, our involvement was to sell to some of the end users at pricing that is consistent with market transactions, thereby allowing for the recognition of revenue on such transactions upon receipt. operations (Note 3).

We periodically review for any expected period of substantial involvement under the agreements that provide for non-refundable up-front payments and fees. If applicable, we will adjust the amortization periods when appropriate to reflect changes in assumptions relating to the duration of our expected involvement.

Revenue is recognized in the month the service (mostly hosting) is provided. Deferred Revenues on the Company’s balance sheet reflects the part of invoiced services (mostly hosting) that will be provided after September 30, 2018 for which cash payments have been received.

Income Taxes

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Additionally, the recognition of future tax benefits, such as net operating loss carryforwards, is required to the extent that realization of such benefits is more likely than not. Deferred tax assets and liabilities are determined using enacted tax rates expected to apply to taxable income in the years in which the assets and liabilities are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income tax expense in the period that includes the enactment date.

In the event the future tax consequences of differences between the financial reporting bases and the tax bases of the Company's assets and liabilities result in deferred tax assets, an evaluation of the probability of being able to realize the future benefits indicated by such asset is required. A valuation allowance is provided for the portion of the deferred tax asset when it is more likely than not that some or all of the deferred tax asset will not be realized. In assessing the realizability of the deferred tax assets, management considers the scheduled reversals of deferred tax liabilities, projected future taxable income, and tax planning strategies.

The Company files income tax returns in the United States, New York and Florida, States, which are subject to examination by the tax authorities in these jurisdictions. Generally, the statute of limitations related to the Company's federal and state income tax return is three years. The state impact of any federal changes for prior years remains subject to examination for a period up to five years after formal notification to the states.

Management has evaluated tax positions in accordance with ASC 740,Income Taxes,and has not identified any significant tax positions, other than those disclosed. All of the Company's tax years since inception remain subject to examination by Federal and State jurisdictions.

Earnings Per Share

Basic net income per common share("Basic EPS'')excludes dilution and is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per common share("Diluted EPS'')reflects the potential dilution that could occur if stock options or other contracts to issue shares of common stock were exercised or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net income per common share.

For the three and six months ended June 30, 2019 and three months ended June 30, 2018, the convertible instruments, consisting of 173,835,076 and 1,000,914,420 common shares into which our outstanding convertible preferred stock and convertible promissory notes, respectively, are convertible, are anti-dilutive and therefore, have been excluded from earnings (loss) per share.

NOTE 5: CONVERTIBLE NOTES PAYABLE

Convertible Notes Payable

Power Up Lending Group, LTD

On July 3, 2018,May 30, 2017, the Company entered into a potentially dilutive convertible noteadvance with Eagle Equities LLC.Power Up Lending Group, LTD. The advance, with a face value of $100,000, bears$38,000, bore interest at 8%12% per annum and iswas payable on July 3, 2019.March 5, 2018. The note was issued at a 7% discount, resulting in net proceeds received after issuance costs and fees was $96,500. In accordance with ASC 835-30-45, Interest, the Company records the fees, costs, and original issue discount as reduction of the carrying amount of the debt and amortizes the balances over the life of the debt instrument.$35,000. Additionally, the note iswas convertible at the holder's discretion into shares of the Company's common stock based on a conversion formula of 60% multiplied by the lowest price of the common shares for the 15 day trading period prior to which the Notice of Conversion iswas received. InDuring the eventyear ended December 31, 2018, the Company experiences a DTC Chill on its shares, the Conversion Price shall be decreased to 50% insteadnoteholder converted $50,858 of 60% while that chill isprincipal and interest into common stock, resulting in effect, DTC Chill is a limitation$0 and $2,387 in principal and interest as of certain services available for a security on deposit at the Depository Trust Company (DTC). A chill is a restriction placed by DTC on one or more of DTC’s services, such as limiting a DTC participant’s ability to make a deposit or withdrawalJune 30, 2019 and December 31, 2018, respectively. The value of the security at DTC. A chill may remain imposed on a security for just a few days or for an extended period of time depending uponconversion feature was assigned to the reasons for the chill and whether the issuer or transfer agent corrects the problem.If the Company fails to maintain the share reserve at the 4x discount of the note 60 days after the issuance of the note, the conversion discount shall be increased by 10%. The conversion formula created an embedded derivative conversion feature.

liability. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of SeptemberJune 30, 2018:2019: dividend yield of zero, 2770 days term to maturity, risk free interest rate of 2.59%0% and annualized volatility of 0%, valued at $9,252.

annualized volatility of 431%, valued at $268,683 The value of the conversion feature was assigned to the derivative liability and created a loss and debt discount to be amortized over the life of the convertible debt.

On August 10,Eagle Equities LLC

During 2018, the Company entered into a potentially dilutive convertible notethree notes with Eagle Equities LLC. The advance, with a face value of $300,000, bears interest at 8% per annum and is payable on August 10, 2019. The net proceeds received after issuance costs and fees was $285,000. In accordance with ASC 835-30-45, Interest, the Company records the fees, costs, and original issue discount as reduction of the carrying amount of the debt and amortizes the balances over the life of the debt instrument. Additionally, the note isnotes are convertible at the holder'sholder’s discretion into shares of the Company'sCompany’s common stock based on a conversion formula of 60% multiplied by the lowest price of the common shares for the 15 day trading period prior to which the Notice of Conversion is received. In the event the Company experiences a DTC Chill on its shares, the Conversion Price shall be decreased to 50% instead of 60% while that chill is in effect. In accordance with ASC 835-30-45, Interest, the Company records the fees, costs, and original issue discount as reduction of the carrying amount of the debt and amortizes the balances over the life of the debt instrument. If the Company fails to maintain the share reserve at the 4x discount of the note 60 days after the issuance of the note, the conversion discount shall be increased by 10%. The conversion formula created an embedded derivative conversion feature.feature for each note. The notes are summarized as follows:

On July 3, 2018, the Company entered into a convertible note with Eagle Equities LLC. The note, with a face value of $100,000, bears interest at 8% per annum and is payable on July 3, 2019. The net proceeds received after issuance costs and fees was $96,500. On January 22, 2019, Eagle Equities LLC declared a default of the convertible note payable to them resulting in fees and penalties equal to $32,108 due to the Company’s delinquent SEC filings. Also on January 22, 2019 Eagle Equities LLC, sold all of its potentially dilutive convertible note to M Svorai Investment, Inc, a related party, included $7,600 in accrued interest. On February 2, 2019 M Svorai Investments, Inc exercised the convertible option, resulting in 5,162,242 shares issued; at a price of $0.02712 per share issued for $132,108 in principal and $7,892 in interest accrued to the conversion date. The remaining balance principal and interest as of June 30, 2019 was $0. As of December 31, 2018, principal and interest balances were $100,000 and $7,118, respectively.

On August 10, 2018, the Company entered into a convertible note with Eagle Equities LLC. The note, with a face value of $300,000, bears interest at 8% per annum and is payable on August 10, 2019. The net proceeds received after issuance costs and fees was $285,000. On March 14, 2019 Eagle Equities LLC declared a default of the convertible note payable to them resulting in fees and penalties equal to $142,884 due to the Company’s delinquent SEC filings, and in same date, sold all of its potentially dilutive convertible note to Back Nine Capital, LLC $147,628, to One Investment Capital, Inc $147,628 and to Sign N Drive Auto Mall, Inc $147,628. As of June 30, 2019 the following chart show the balances on principal and interest as of June 30, 2019:

On March 14, 2019, Back Nine Capital LLC, purchased one third of a potentially dilutive convertible note held by Eagle Equities, LLC, issued on August 10, 2018 with a face value of $300,000 and $142,884 as Default Charges, therefore Back Nine Capital, LLC, now held $147,628. The Company valued thisthe related conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of SeptemberJune 30, 2018:2019: dividend yield of zero, 31441 days term to maturity, risk free interest rate of 2.59%2.18% and annualized volatility of 432%348%, valued at $795,326.$398,329. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to be amortized over the life of the convertible debt. The principal and interest balances as of June 30, 2019 were $147,628 and $7,859 respectively.

On March 14, 2019, One Investment Capital, Inc, purchased one third of a potentially dilutive convertible note held by Eagle Equities, LLC, issued on August 10, 2018 with a face value of $300,000 and $142,884 as Default Charges, therefore One Investment Capital, Inc, now held $147,628. The Company valued the related conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of June 30, 2019: dividend yield of zero, 41 days to maturity, risk free interest rate of 2.18% and annualized volatility of 348%, valued at $398,329. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to amortized over the life of the convertible debt. The principal and interest balances as of June 30, 2019 were $147,628 and $7,859 respectively.

On March 14, 2019, Sign N Drive Auto Mall, Inc, purchased one third of a potentially dilutive convertible note held by Eagle Equities, LLC, issued on August 10, 2018 with a face value of $300,000 and $142,884 as Default Charges, therefore Sign N Drive Auto Mall, Inc, now held $147,628. The Company valued the related conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of June 30, 2019: dividend yield of zero, 41 days to maturity, risk free interest rate of 2.18% and annualized volatility of 348%, valued at $398,329. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to amortized over the life of the convertible debt. The principal and interest balances as of June 30, 2019 were $147,628 and $7,859 respectively.

On August 10, 2018, the Company entered into a potentially dilutive convertible note with Eagle Equities LLC. The advance,note, with a face value of $100,000, bears interest at 8% per annum and is payable on August 10, 2019. The net proceeds received after issuance costs and fees was $95,000. In accordance with ASC 835-30-45, Interest, the Company records the fees, costs,The principal and original issue discountinterest balances as reductionof March 14, 2019 were $100,000 and $ 5,384, respectively. As of December 31, 2018, principal and interest balances were $100,000 and $3,784, respectively. On March 14, 2019 Eagle Equities LLC declared a default of the carryingconvertible note payable to them in the amount of $47,198 due to the debtCompany’s SEC delinquent filings, and amortizes the balances over the lifein same date Eagle Equities LLC, sold all of the debt instrument. Additionally, theits potentially dilutive convertible note is convertible at the holder's discretion into shares of the Company's common stock based on a conversion formula of 60% multiplied by the lowest price of the common shares for the 15 day trading period prior to which the Notice of Conversion is received. In the event the Company experiences a DTC Chill on its shares, the Conversion Price shall be decreased to 50% instead of 60% while that chill isGary Berlly, an individual, included $47,198 in effect. If the Company fails to maintain the share reserve at the 4x discount of the note 60 days after the issuance of the note, the conversion discount shall be increased by 10%. The conversion formula created an embedded derivative conversion feature.

accrued interest and penalties. The Company valued thisthe related conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of SeptemberJune 30, 2018:2019: dividend yield of zero, 31441 days term to maturity, risk free interest rate of 2.59%2.18% and annualized volatility of 432%348%, valued at $264,686.$397,179. The value of the conversion feature was assigned to the derivative liability and created a loss and debt discount to be amortized over the life of the convertible debt. The principal and interest balances as of June 30, 2019 were $147,198 and $7,840 respectively.

Firstfire Global Opportunity Fund, LLC

On September 11, 2018, the Company entered into a potentially dilutive convertible note with Firstfire Global Opportunities Fund, LLC. The advance,note, with a face value of $210,000, bears interest at 5% per annum and iswas payable on JulyJune 11, 2018.2019. The note was issued at a $10,000 (“OID”) discount. The net proceeds received after issuance costs and fees was $195,000. In accordance with ASC 835-30-45, Interest, the Company records the fees, costs, and original issue discount as reduction of the carrying amount of the debt and amortizes the balances over the life of the debt instrument. Additionally, the note is convertible at the holder's discretion into shares of the Company's common stock based on a conversion formula of 65% multiplied by the lowest price of the common shares for the 20 consecutive trading days period immediately preceding the Trading Day that the Company receives a Notice of Conversion. The conversion formula created an embedded derivative conversion feature.

On January 16, 2019, Firstfire Global Opportunities Fund, LLC sold all of its potentially dilutive convertible note of $210,000 issued on September 11, 2018 to: (i) twenty five percent (25%) of its potentially dilutive convertible note to Back Nine Capital LLC, or $52,500; (ii) twenty five percent (25%) of its potentially dilutive convertible note to Gary Berlly, or $52,500; (iii) twenty five percent (25%) of its potentially dilutive convertible note to One Investment Capital, or $52,500 and (iv) twenty five percent (25%) of its potentially dilutive convertible note to Sig N Drive Auto Mall, Inc, or $52,500.

On January 22, 2019, Back Nine Capital, LLC exercised the convertible option, resulting in 3,000,000 shares issued; at a price of $0.0130 per share issued for $39,000 in principal. The balance on the note as of June 30, 2019 was $13,500 and $766 in accrued interest. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of SeptemberJune 30, 2018:2019: dividend yield of zero, 256 day0 days term to maturity, risk free interest rate of 2.36%0% and annualized volatility of 193%0%, valued at $390,009.$51,040. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to be amortized over the life of the convertible debt.

NOTE 6: RELATED PARTY LOANS:

Convertible Notes Payable

On February 21, 2018 Crown Bridge Partners LLC, sold partJanuary 23, 2019, Gary Berlly exercised the convertible option, resulting in 3,000,000 shares issued; at a price of its potentially dilutive convertible$0.0130 per share issued for $39,000 in principal. The balance on the note to D&D Capital, Inc, a related party. Accrued interest related to this advanceas of June 30, 2019 was $392$13,500 and $0 at September 30, 2018 and December 31, 2017, respectively, and is included$766 in accrued interest on the condensed consolidated Balance Sheets.interest. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of SeptemberJune 30, 20182019: dividend yield of zero, 1790 days term to maturity, risk free interest rate of 2.36%0% and annualized volatility of 200%0%, valued at $20,817.$51,040. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to be amortized over the life of the convertible debt.

During the nine months ended September 30, 2018, D&DOn January 23, 2019, One Investment Capital, Inc.,Inc exercised the convertible option, resulting in 2,298,2123,000,000 shares issued; at a price of $0.04134$0.0130 per share issued for $95,008$39,000 in principal. The balance on the note as of June 30, 2019 was $13,500 and $766 in accrued interest. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of June 30, 2019: dividend yield of zero, 0 days term to maturity, risk free interest rate of 0% and annualized volatility of 0%, valued at $51,040. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to be amortized over the life of the convertible debt.

On January 23, 2019, Sign N Drive Auto Mall, Inc exercised the convertible option, resulting in 3,000,000 shares issued; at a price of $0.0130 per share issued for $39,000 in principal. The balance on the note as of June 30, 2019 was $13,500 and $766 in accrued interest. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of June 30, 2019: dividend yield of zero, 0 days term to maturity, risk free interest rate of 0% and annualized volatility of 0%, valued at $51,040. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to be amortized over the life of the convertible debt.

On April 9, 2019, the Company entered into a convertible note with Sign N Drive Auto Mall, Inc. The note, with a face value of $15,000, bears interest at 12% per annum and is payable on April 9, 2020, net of proceeds was $15,000. The conversion price (the "Conversion

Price") shall be a sixty percent (60%) discount to the lowest closing bid price of the common stock of the Company during the thirty (30) trading days before the Conversion Date, as reported by OTC Markets or a comparable reporting agency. The conversion formula created an embedded derivative conversion feature. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of June 30, 2019: dividend yield of zero, 284 days term to maturity, risk free interest rate of 1.92% and annualized volatility of 376%, valued at $133,720. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to be amortized over the life of the convertible debt. The principal and $2,387interest balances as of June 30, 2019 were $15,000 and $448 respectively.

On April 26, 2019, the Company entered into a convertible note with Sign N Drive Auto Mall, Inc. The note, with a face value of $100,000, bears interest at 12% per annum and is payable on April 26, 2020, net of proceeds was $100,000. The conversion price (the "Conversion Price") shall be a sixty percent (60%) discount to the lowest closing bid price of the common stock of the Company during the thirty (30) trading days before the Conversion Date, as reported by OTC Markets or a comparable reporting agency. The conversion formula created an embedded derivative conversion feature. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of June 30, 2019: dividend yield of zero, 300 days term to maturity, risk free interest rate of 1.92% and annualized volatility of 368%, valued at $892,009. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to be amortized over the life of the convertible debt. The principal and interest balances as of June 30, 2019 were $100,000 and $2,992 respectively.

On June 28, 2019, the Company entered into a convertible note with Sunny Isles Capital, Inc. The note, with a face value of $10,000, bears interest at 12% per annum and is payable on June 28, 2020, net of proceeds was $10,000. The conversion price (the "Conversion Price") shall be a sixty percent (60%) discount to the lowest closing bid price of the common stock of the Company during the thirty (30) trading days before the Conversion Date, as reported by OTC Markets or a comparable reporting agency. The conversion formula created an embedded derivative conversion feature. The Company valued this conversion feature using the Black Scholes valuation model with the following assumptions: (i) as of June 30, 2019: dividend yield of zero, 364 days term to maturity, risk free interest rate of 1.92% and annualized volatility of 345%, valued at $89,450. The value of the conversion feature was assigned to the derivative liability and created a loss and a debt discount to be amortized over the life of the convertible debt. The principal and interest balances as of June 30, 2019 were $10,000 and $299 respectively.

At December 31, 2018, the above loans had an aggregate outstanding principal balance of $710,000 and unamortized debt discount of $418,314, resulting in accrued interest.net principal of $291,686.