x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

110 Spring Hill Road #10
Grass Valley, CA 95945
(Address of principal executive offices)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, 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

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

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 7(a)(2)(B) of the Securities Act. o

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

As of ~~August~~November 9, 2021, there were ~~5,887,879,019~~6,949,744,34 shares of the registrant’s $0.001 par value common stock issued and outstanding.

Statements made in this Form 10-Q that are not historical or current facts are “forward-looking statements.”. These statements often can be identified by the use of terms such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “approximate” or “continue,” or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management’s best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions for Form 10-Q and Article 210 8-03 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature. Operating results for the ~~six~~nine months ended ~~June~~September 30, 2021, are not necessarily indicative of the results that may be expected for the year ending December 31, 2021.For further information, refer to the financial statements and footnotes thereto included in our company’s Annual Report on Form 10-K for the year ended December 31, 2020 as filed with the Securities and Exchange Commission on March 31, 2021.

	June 30,			December 31,
	2021			2020			September 30,			December 31,
	(Unaudited)			(Audited)			2021			2020
ASSETS								(Unaudited)			(Audited)
Current Assets
Cash	$	287,757		$	72,764		$	275,800		$	72,764
Accounts receivable		1,720,849			97,701			1,161,813			97,701
Earnings in excess of billings		547,366			489			598,720			489
Inventory		114,530			44,223			242,516			44,223
Prepaid expenses		31,062			8,552			92,489			8,552
Other current assets		19,500			—			19,500			—
Total current assets		2,721,064			223,729			2,390,838			223,729

Property, plant, and equipment, net		192,467			109,339			234,952			109,339
Right-of-use asset		225,841			246,968			215,008			246,968
Security deposit		16,980			16,980			16,980			16,980

TOTAL ASSETS	$	3,156,352		$	597,016		$	2,857,778		$	597,016

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities:
Accounts payable	$	623,076		$	843,882		$	797,608		$	843,882
Accrued interest		140,220			106,639			161,086			106,639
Accrued liabilities		147,328			286,997			109,954			286,997
Billings in excess of revenue		2,482,858			71,280			2,029,571			71,280
Current operating lease liabilities		44,448			42,977			45,203			42,977
Convertible notes payable, net of discount		325,268			149,988			266,859			149,988
Derivative liabilities		1,756,216			2,373,176			2,636,692			2,373,176
Liability for unissued shares		150,825			150,825			150,825			150,825
Promissory notes payable, net of discount		117,469			101,056			195,481			101,056
Related party liabilities		129,124			154,252			150,704			154,252
Total Current Liabilities		5,916,832			4,281,072			6,543,983			4,281,072

Long term debt		223,288			281,357			150,609			281,357
Non-current operating lease liabilities		181,393			203,991			169,805			203,991

Total Liabilities		6,321,513			4,766,420			6,864,397			4,766,420

Commitments and contingencies		—			—			—			—

Stockholders’ Deficit:
Preferred stock, Series A: $0.001 par value; 30,000,000 shares authorized		880			1,120
879,497 shares issued and outstanding at June 30, 2021
1,120,000 shares issued and outstanding at December 31, 2020
Preferred stock, Series B: $0.001 par value; 1,000 shares authorized		1			1
1,000 shares issued and outstanding at June 30, 2021
1,000 shares issued and outstanding at December 31, 2020
Common stock, $0.001 par value; 25,000,000,000 authorized		5,460,734			3,534,022
5,460,733,926 shares issued and outstanding at June 30, 2021
3,534,022,455 shares issued and outstanding at December 31, 2020
Preferred stock, Series A: $0.001 par value; 30,000,000 shares authorized; 796,997 shares issued and outstanding at September 30, 2021; 1,120,000 shares issued and outstanding at December 31, 2020								797			1,120
Preferred stock, Series B: $0.001 par value; 1,000 shares authorized; 1,000 shares issued and outstanding at September 30, 2021; 1,000 shares issued and outstanding at December 31, 2020								1			1
Common stock, $0.001 par value; 25,000,000,000 authorized; 6,438,301,121 shares issued and outstanding at September 30, 2021; 3,534,022,455 shares issued and outstanding at December 31, 2020								6,438,301			3,534,022
Additional paid in capital		2,527,442			(748,254	)		2,227,378			(748,254	)
Retained earnings		(11,154,218	)		(6,956,293	)		(12,673,096	)		(6,956,293	)
Total stockholders’ deficit		(3,165,161	)		(4,169,404	)		(4,006,619	)		(4,169,404	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	3,156,352		$	597,016		$	2,857,778		$	597,016


	Three months ended						Six months ended						Three months ended						Nine months ended
	June 30,						June 30,						September 30,						September 30,
	2021			2020			2021			2020			2021			2020			2021			2020
Sales	$	48,764		$	56,554		$	62,015		$	95,488		$	575,128		$	927,012		$	637,143		$	1,022,499
Cost of sales		8,501			35,647			16,115			57,270			357,429			163,525			373,544			220,795
Gross profit		40,263			20,907			45,900			38,218			217,699			763,487			263,599			801,704

Operating expenses:
Consulting fees		24,423			4,012,500			146,031			4,037,250			(67,500	)		17,163			78,531			4,054,413
Depreciation		10,150			9,431			19,100			21,834
Depreciation and amortization														11,591			9,005			30,691			30,839
G&A expenses		133,521			82,625			275,096			152,851			170,477			37,288			445,573			190,220
Professional fees		34,356			69,350			115,058			116,801			22,903			78,850			137,961			195,570
Salaries and wages		257,622			68,628			308,788			216,289			112,441			70,628			421,229			286,916
Total operating expenses		460,072			4,242,534			864,073			4,545,025			249,912			212,934			1,113,985			4,757,958

Loss from operations		(419,809	)		(4,221,627	)		(818,173	)		(4,506,807	)		(32,213	)		550,553			(850,386	)		(3,956,254	)

Other income (expense):
Other income		25,004			—			25,004			—			3			—			25,007			—
Debt forgiveness		61,588			—			75,512			—			—			—			75,512			—
Gain (loss) on derivative liability valuation		430,007			(1,592,416	)		(603,705	)		(3,303,148	)
Derivative expenses														(792,182	)		305,406			(1,395,887	)		(2,997,742	)
Loss on conversion		(1,254,514	)		(371,090	)		(2,040,829	)		(371,090	)		(262,778	)		(616,357	)		(2,303,607	)		(987,447	)
Loss on disposal of assets														(16,267	)		—			(16,267	)		—
Interest expense		(402,443	)		(302,240	)		(835,734	)		(442,717	)		(415,441	)		(444,846	)		(1,251,175	)		(887,563	)
Total other expenses		(1,140,358	)		(2,265,746	)		(3,379,752	)		(4,116,955	)		(1,486,665	)		(755,797	)		(4,866,417	)		(4,872,752	)

Net loss before income taxes		(1,560,167	)		(6,487,373	)		(4,197,925	)		(8,623,762	)		(1,518,878	)		(205,244	)		(5,716,803	)		(8,829,006	)
Income tax expense		—			—			—			—			—			(6,800	)		—			(6,800	)
Net loss	$	(1,560,167	)	$	(6,487,373	)	$	(4,197,925	)	$	(8,623,762	)	$	(1,518,878	)	$	(212,044	)	$	(5,716,803	)	$	(8,835,806	)

Per share information
Weighted number of common shares outstanding, basic, and diluted		4,868,420,548			198,040,748			4,435,049,550			110,093,354			6,019,769,137			1,359,512,034			4,969,094,246			529,606,195
Net loss per common share	$	(0.0003	)	$	(0.0328	)	$	(0.0009	)	$	(0.0783	)	$	(0.0003	)	$	(0.0002	)	$	(0.0012	)	$	(0.0167	)


	Preferred Stock						Preferred Stock										Additional						Total			Preferred Stock						Preferred Stock										Additional						Total
	Series A						Series B				Common Stock						Paid-In			Retained			Stockholders’			Series A						Series B				Common Stock						Paid-In			Retained			Stockholders’
	Shares			Amount			Shares		Amount		Shares			Amount			Capital			Earnings			Equity (Deficit)			Shares			Amount			Shares		Amount		Shares			Amount			Capital			Earnings			Equity (Deficit)
Balance at December 31, 2020		1,120,000		$	1,120			1,000	$	1		3,534,022,455		$	3,534,022		$	(748,254	)	$	(6,956,293	)	$	(4,169,404	)		1,120,000		$	1,120			1,000	$	1		3,534,022,455		$	3,534,022		$	(748,254	)	$	(6,956,293	)	$	(4,169,404	)
Conversion of convertible notes payable to stock		—			—			—		—		175,060,588			175,061			1,448,275			—			1,623,336			—			—			—		—		175,060,588			175,061			1,448,275			—			1,623,336
Derivative settlements		—			—			—		—		—			—			435,301			—			435,301			—			—			—		—		—			—			435,301			—			435,301
Preferred stock converted to common stock		(172,500	)		(172	)		—		—		570,299,494			570,299			216,188			—			786,315			(172,500	)		(172	)		—		—		570,299,494			570,299			216,188			—			786,315
Preferred stock issued for services		10,000			10			—		—		—			—			99,990			—			100,000			10,000			10			—		—		—			—			99,990			—			100,000
Warrant exercise		—			—			—		—		72,048,517			72,049			(72,049	)		—			—			—			—			—		—		72,048,517			72,049			(72,049	)		—			—
Net loss		—			—			—		—		—			—			—			(2,637,758	)		(2,637,758	)		—			—			—		—		—			—			—			(2,637,758	)		(2,637,758	)
Balance at March 31, 2021		957,500		$	958			1,000	$	1		4,351,431,054		$	4,351,431		$	1,379,451		$	(9,594,051	)	$	(3,862,210	)		957,500		$	958			1,000	$	1		4,351,431,054		$	4,351,431		$	1,379,451		$	(9,594,051	)	$	(3,862,210	)

Conversion of convertible notes payable to stock		—			—			—		—		331,416,690			331,417			666,477			—			997,894			—			—			—		—		331,416,690			331,417			666,477			—			997,894
Conversion of promissory notes to stock		—			—			—		—		198,130,434			198,130			396,261			—			594,391			—			—			—		—		198,130,434			198,130			396,261			—			594,391
Derivative settlements		—			—			—		—		—			—			(476,872	)		—			(476,872	)		—			—			—		—		—			—			(476,872	)		—			(476,872	)
Preferred stock converted to common stock		(112,500	)		(112	)		—		—		579,755,748			579,756			217,189			—			796,833			(112,500	)		(112	)		—		—		579,755,748			579,756			217,189			—			796,833
Preferred stock issued for services		20,000			20			—		—		—			—			199,980			—			200,000			20,000			20			—		—		—			—			199,980			—			200,000
Preferred stock issued to settle debt		14,497			14			—		—		—			—			144,956			—			144,970			14,497			14			—		—		—			—			144,956			—			144,970
Net loss		—			—			—		—		—			—			—			(1,560,167	)		(1,560,167	)		—			—			—		—		—			—			—			(1,560,167	)		(1,560,167	)
Balance at June 30, 2021		879,497		$	880			1,000	$	1		5,460,733,926		$	5,460,734		$	2,527,442		$	(11,154,218	)	$	(3,165,161	)		879,497		$	880			1,000	$	1		5,460,733,926		$	5,460,734		$	2,527,442		$	(11,154,218	)	$	(3,165,161	)

Conversion of convertible notes payable to stock																											—			—			—		—		347,501,836			347,502			299,811			—			647,313
Derivative settlements																											—			—			—		—		—			—			(132,670	)		—			(132,670	)
Preferred stock converted to common stock																											(72,500	)		(73	)		—		—		630,065,359			630,065			(367,215	)		—			262,777
Preferred stock cancelled for services																											(10,000	)		(10	)		—		—		—			—			(99,990	)		—			(100,000	)
Net loss																											—			—			—		—		—			—			—			(1,518,878	)		(1,518,878	)
Balance at September 30, 2021																											796,997		$	797			1,000	$	1		6,438,301,121		$	6,438,301		$	2,227,378		$	(12,673,096	)	$	(4,006,619	)

	Preferred Stock						Preferred Stock										Additional						Total			Preferred Stock						Preferred Stock										Additional						Total
	Series A						Series B				Common Stock						Paid-In			Retained			Stockholders’			Series A						Series B				Common Stock						Paid-In			Retained			Stockholders’
	Shares			Amount			Shares		Amount		Shares			Amount			Capital			Earnings			Equity (Deficit)			Shares			Amount			Shares		Amount		Shares			Amount			Capital			Earnings			Equity (Deficit)
Balance at December 31, 2019		400,000		$	400			1,000	$	—		10,343,330		$	10,343		$	(15,240,774	)	$	9,368,557		$	(5,861,474	)		400,000		$	400			1,000	$	—		10,343,330		$	10,343		$	(15,240,774	)	$	9,368,557		$	(5,861,474	)
Conversion of convertible notes to stock		—			—			—		—		32,260,676			32,261			366,617			—			398,878			—			—			—		—		32,260,676			32,261			366,617			—			398,878
Derivative settlements		—			—			—		—		—			—			(50,586	)		—			(50,586	)		—			—			—		—		—			—			(50,586	)		—			(50,586	)
Cancellation of stock issued for services		—			—			—		—		(8,008,334	)		(8,008	)		(42,257	)		—			(50,265	)		—			—			—		—		(8,008,334	)		(8,008	)		(42,257	)		—			(50,265	)
Preferred stock issued per agreement		500,000			500			—		—		—			—			—			—			500			500,000			500			—		—		—			—			—			—			500
Net loss		—			—			—		—		—			—			—			(2,136,389	)		(2,136,389	)		—			—			—		—		—			—			—			(2,136,389	)		(2,136,389	)
Balance at March 31, 2020		900,000		$	900			1,000	$	—		34,595,672		$	34,596		$	(14,967,000	)	$	7,232,168		$	(7,699,336	)		900,000		$	900			1,000	$	—		34,595,672		$	34,596		$	(14,967,000	)	$	7,232,168		$	(7,699,336	)

Conversion of convertible notes to stock		—			—			—		—		259,074,233			259,074			4,421,942			—			4,681,016			—			—			—		—		259,074,233			259,074			4,421,942			—			4,681,016
Derivative settlements		—			—			—		—		—			—			(1,026,700	)		—			(1,026,700	)		—			—			—		—		—			—			(1,026,700	)		—			(1,026,700	)
Preferred stock issued for services		400,000			400			—		—		—			—			3,999,600			—			4,000,000			400,000			400			—		—		—			—			3,999,600			—			4,000,000
Preferred stock converted to common stock		(185,177	)		(185	)		—		—		232,920,612			232,921			138,355			—			371,091			(185,177	)		(185	)		—		—		232,920,612			232,921			138,355			—			371,091
Net loss		—			—			—		—		—			—			—			(6,487,373	)		(6,487,373	)		—			—			—		—		—			—			—			(6,487,373	)		(6,487,373	)
Balance at June 30, 2020		1,114,823		$	1,115			1,000	$	—		526,590,517		$	526,591		$	(7,433,803	)	$	744,795		$	(6,161,302	)		1,114,823		$	1,115			1,000	$	—		526,590,517		$	526,591		$	(7,433,803	)	$	744,795		$	(6,161,302	)

Conversion of convertible notes to stock																											—			—			—		—		554,136,908			554,137			2,147,327			—			2,701,464
Derivative settlements																											—			—			—		—		—			—			(177,999	)		—			(177,999	)
Preferred stock converted to common stock																											(263,823	)		(264	)		—		—		632,339,244			632,339			(15,719	)		—			616,356
Warrant exercise																											—			—			—		—		161,202,720			161,202			(161,202	)		—			—
Net loss																											—			—			—		—		—			—			—			(212,044	)		(212,044	)
Balance at September 30, 2020																											851,000		$	851			1,000	$	1		1,874,269,389		$	1,874,269		$	(5,641,396	)	$	532,751		$	(3,233,524	)


	Six months ended						Nine months ended
	June 30,						September 30,
	2021			2020			2021			2020
Cash flows from operating activities:
Net loss	$	(4,197,925	)	$	(8,623,762	)	$	(5,716,803	)	$	(8,835,806	)
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of convertible debt discount		734,312			209,094			1,089,415			473,587
Change in derivative liability		603,705			3,303,148			1,395,887			2,997,742
Common stock issued for services		—			(25,000	)		—			(25,000	)
Debt forgiveness		(75,512	)		—			(75,512	)		—
Depreciation and amortization of fixed assets		19,100			—			30,691			—
Loss on conversion		2,040,829			371,090			2,303,607			987,447
Preferred stock issued for services		300,000			4,000,000			200,000			4,000,000
Liability for unissued shares due to agreements		—			25,000			—			25,000
Decrease (increase) in operating assets
Accounts receivable		(1,623,148	)		(150,287	)		(1,064,112	)		268,839
Deposits		—			(12,000	)		—			(12,000	)
Earnings in excess of billings		(546,877	)		(111,163	)		(598,231	)		(138,124	)
Inventory		(70,307	)		129			(198,293	)		129
Prepaid expenses		(22,510	)		6,568			(83,937	)		8,584
Other assets		(19,500	)		(65	)		(19,500	)		156
Increase (decrease) in operating liabilities
Accounts payable		(75,836	)		(74,883	)		98,696			(119,728	)
Accrued interest		103,468			226,465			148,968			403,736
Accrued liabilities		71,893			103,301			(101,531	)		224,110
Billings in excess of revenues		2,411,578			269,655			1,958,291			(1,032,251	)
Long term debt		(58,069	)		(30,157	)		(130,748	)		(28,356	)
Net cash (used in) provided by operating activities		(404,799	)		(512,867	)		(763,112	)		(801,935	)

Cash flows from investing activities
Property, plant and equipment, additions		(102,228	)		—			(247,050	)		—
Property, plant and equipment, reductions		—			21,834			90,746			30,839
Net cash (used in) provided by investing activities		(102,228	)		21,834			(156,304	)		30,839

Cash flows from financing activities:
Proceeds from convertible debt		787,000			360,900			942,000			698,540
Proceeds from promissory notes		109,000			93,090			184,000			93,090
Related party liabilities		(173,980	)		44,376			(3,548	)		58,080
Net cash (used in) provided for financing activities		722,020			498,366			1,122,452			849,710

Net increase (decrease) in cash		214,993			7,333			203,036			78,614

Cash, beginning of period		72,764			1,444			72,764			1,444
Cash, end of period	$	287,757		$	8,777		$	275,800		$	80,058

Supplemental disclosures of cash flow information:
Cash paid for income taxes	$	—		$	—		$	—		$	—
Cash paid for interest	$	—		$	—		$	—		$	—

Schedule of non-cash investing & financing activities
Stock issued for note payable conversion	$	2,621,230		$	5,079,894		$	3,268,543		$	7,781,358
Stock issued for promissory note conversion	$	594,391		$	—		$	594,391		$	—
Derivative settlements	$	(41,571	)	$	(1,077,286	)	$	(174,241	)	$	(1,255,285	)
Discount from derivative	$	913,579		$	596,060		$	1,168,578		$	975,510
Preferred stock converted to common stock	$	1,583,148		$	371,091		$	1,845,925		$	987,447
Preferred stock issued to settle liabilities	$	144,970		$	—		$	144,970		$	—
Cashless warrant exercise	$	72,049		$	—		$	72,049		$	161,202
Cancellation of common stock issued for services	$	—		$	(50,265	)	$	—		$	(50,265	)

NOTE 1 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Located in Grass Valley, CA, BrewBilt is one of the only California companies that custom designs, hand crafts, and integrates processing, fermentation and distillation processing systems for the craft beer, cannabis and hemp industries using “Best in Class” American made components integrated with stainless steel processing vessels using only American made steel. Founded in 2014, the company began in a backyard shop by Jeff Lewis with a vision of creating a profitable company in “Rural America” by hiring excellent personnel, designing, and fabricating products to exceed customer’s expectations and compensating craftsmen with living wages and profit sharing to financially sustain their families within the community. Mr. Lewis has 15+ years of experience as a craft beer brewer, a custom tank/vessel designer, fabrication and integration expert and business owner who initially founded Portland Kettle Works, a nationally recognized manufacturer of craft beer brewing equipment located in the Northwest. The Company has grown from 3 employees in 2015 to 10 in 2021.

BrewBilt manufactures equipment for both brewery and cannabis industries, respectively. The equipment is FDA and USDA compliant as manufactured from medical-grade stainless steel. All systems are subject to FDA guidelines.

The company manufactures equipment that is compliant with USDA and FDA regulations as a part of the certification process for qualifying the cannabis product as pharmaceutical grade. Testing laboratories that are DEA and FDA registered can perform potency testing to determine the precise amount of a given cannabinoid in a product that certifies the product as pharmaceutical grade. A number of these laboratories are also accredited hemp testing labs. The producers may request documentation from the registered testing laboratories to verify THC content.

BrewBilt has been built by having strong relationships with local suppliers of raw materials, equipment and services in California, an aggressive referral network of satisfied customers nationwide, and an Advisory Board consisting of successful business leaders that provide valuable product feedback and business expertise to management. The craft brewing & spirits industries continue to grow worldwide. California is where craft brewing began and now has over 900 operating breweries. The Company is centrally located in this booming market, and this was a large draw for BrewBilt to locate its manufacturing facility in the Sierra foothills.

All BrewBilt products are designed and fabricated as “food grade” quality which enables the company to build vessels for food & beverage processing, the company is now building systems that are pharmaceutical grade for clients involved in distillation for the cannabis and hemp industries, thus making the revenue potential much greater because pharmaceutical grade products have higher profit margins. BrewBilt buys materials and components mostly from California suppliers which enables them to closely monitor quality, while the company’s revenues are generated from sales to customers throughout the country. The company is aggressively pursuing international orders and has held meetings with the Center for International Trade Development and U.S. Commercial Service to develop international opportunities. Presently, a great deal of sales interest in coming from Mexico, Japan, Europe, and Australia.

BrewBilt competes against a number of companies, most of which are selling mass produced equipment from China made from less costly inferior quality Chinese steel which often is neither food nor pharmaceutical grade quality. While this broader market is extremely competitive, there continues to be little competition and strong market demand for higher quality, custom designed, hand crafted and integrated systems that BrewBilt produces.

The audited financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported therein. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be based upon amounts that differ from these estimates.

The Company considers all highly liquid investments with maturities of 90 days or less from the date of purchase to be cash equivalents.

The Company began seeing the impact of the COVID-19 pandemic on its business in early March 2020. The direct financial impact of the pandemic has primarily shown in significantly reduced production from the on-premises channel and higher labor and safety-related costs at the Company’s manufacturing facility. In addition to these direct financial impacts, COVID-19 related safety measures resulted in a reduction of manufacturing productivity. The Company will continue to assess and manage this situation and will provide a further update in each quarterly earnings release, to the extent that the effects of the COVID-19 pandemic are then known more clearly.

The Company recognizes revenue when obligations under the terms of a contract with its customer are satisfied; generally, this occurs with the transfer of control of its products. Revenue is measured as the amount of consideration expected to be received in exchange for transferring products. If the conditions for revenue recognition are not met, the Company defers the revenue and related cost of sales until all conditions are met. As of ~~June~~September 30, 2021 and December 31, 2020, the Company has deferred ~~$2,482,858~~$2,029,571 and ~~$71,280,~~$71,280, respectively, in revenue, and ~~$547,366~~$598,720 and ~~$489~~$489 in cost of sales, respectively, related to customer orders in progress. These amounts are recorded as billings in excess of revenues and earnings in excess of billings in the accompanying balance sheets.

Accounts receivable are stated at the amount that management expects to collect from outstanding balances. Bad debts and allowances are provided based on historical experience and management’s evaluation of outstanding accounts receivable. Management evaluates past due or delinquency of accounts receivable based on the open invoices aged on due date basis. The allowance for doubtful accounts at ~~June~~September 30, 2021 and December 31, 2020 is $0.

Inventories consist of raw materials, work in process and finished goods. Raw materials, which principally consist of raw stainless steel, raw stainless tubing, motors, pumps, and fittings, are stated at the lower of cost, determined on the first-in, first-out basis, or net realizable value. During the year ended December 31, ~~2021,~~2020, the Company wrote off ~~$17,246~~$17,246 in obsolete inventory to the statement of operations. As of ~~June~~September 30, 2021 and December 31, 2020, the Company has inventory of ~~$114,530~~$242,516 and ~~$44,223,~~$44,223, respectively.

The excess of the cost over the fair value of net assets of acquired in the Merger is recorded as goodwill. Goodwill is not subject to amortization, but is reviewed for impairment annually, or more frequently whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. An impairment charge would be recorded to the extent the carrying value of goodwill exceeds its estimated fair value. The testing of goodwill under established guidelines for impairment requires significant use of judgment and assumptions. Changes in forecasted operations and other assumptions could materially affect the estimated fair values. Changes in business conditions could potentially require adjustments to these asset valuations.

The Company is a manufacturer of products which are shipped to our customers directly from the Company. For products that are made from raw materials, the Company offers a 6-year limited warranty. The parts provided by outside vendors as finished goods that are added to a system produced by the Company as components, have a manufacturers’ warranty that is passed on to the end user of the complete system. To date, BrewBilt has spent less than $5,000 over the past 5 years for repairs (under warranty) on products they have built, with most of the costs going to cover travel and lodging expenses. As of ~~June~~September 30, 2021 and December 31, 2020, the Company has recorded a liability of ~~$5,000~~$5,000 and ~~$5,000,~~$5,000, respectively, for warranties, which is included in accrued liabilities in the accompanying balance sheet.

Accounts payable and accrued expenses are carried at amortized cost and represent liabilities for goods and services provided to the Company prior to the end of the fiscal year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of these goods and services.

Fair value is defined as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk including our own credit risk.

In addition to defining fair value, the standard expands the disclosure requirements around fair value and establishes a fair value hierarchy for valuation inputs is expanded. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels and which is determined by the lowest level input that is significant to the fair value measurement in its entirety.

Level 1 - inputs are based upon unadjusted quoted prices for identical instruments traded in active markets.

Level 2 - inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 - inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques.

	Input		June 30, 2021		December 31, 2020		Input	September 30, 2021		December 31, 2020
	Level		Fair Value		Fair Value		Level	Fair Value		Fair Value
Derivative Liability		3	$	1,756,216	$	2,373,176	3	$	2,636,692	$	2,373,176
Total Financial Liabilities			$	1,756,216	$	2,373,176		$	2,636,692	$	2,373,176

In management’s opinion, the fair value of convertible notes payable and advances payable is approximate to carrying value as the interest rates and other features of these instruments approximate those obtainable for similar instruments in the current market. Unless otherwise noted, it is management’s opinion that the Company is not exposed to significant interest, exchange or credit risks arising from these financial instruments. As of ~~June~~September 30, 2021 and December 31, 2020, the balances reported for cash, accounts receivable, prepaid expenses, accounts payable, and accrued liabilities, approximate the fair value because of their short maturities.

The Company records deferred taxes in accordance with FASB ASC No. 740, Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and loss carryforwards and their respective tax bases. 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 of a change in tax rules on deferred tax assets and liabilities is recognized in operations in the year of change. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.

As of the date of this filing, the Company is not current in filing their tax returns. The last return filed by the Company was December 31, 2019, and the Company has not accrued any potential penalties or interest from that period forward. The Company will need to file returns for the year ending December 31, 2020, which is still open for examination.

In accordance with ASC Topic 280 – “Earnings Per Share”, the basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive.

Although there were new accounting pronouncements issued or proposed by the FASB during the ~~six~~nine months ended ~~June~~September 30, 2021 and through the date of filing of this report, the Company does not believe any of these accounting pronouncements has had or will have a material impact on its financial position or results of operations.

The Company has experienced net losses to date, and it has not generated sufficient revenue from operations to meet our operational overhead. We will need additional working capital to service debt and for ongoing operations, which raises substantial doubt about our ability to continue as a going concern. Management of the Company is preparing a strategy to meet operational shortfalls which may include equity funding, short term or long-term financing or debt financing, to enable the Company to reach profitable operations. Historically, the Company’s sole officer and director has provided short term loans to meet working capital shortfalls. We have recently entered into financing agreements with various third parties to meet our capital needs in fiscal 2021.

The accompanying financial statements do not include any adjustments related to the recoverability or classification of asset-carrying amounts or the amounts and classification of liabilities that may result should the Company be unable to continue as a going concern.

Prepaid fees represent amounts paid in advance for future contractual benefits to be received. Contracting expenses paid in advance are recorded as a prepaid asset and then amortized to the statements of operations when services are rendered, or over the life of the contract using the straight-line method.

As of ~~June~~September 30, 2021 and December 31, 2020, prepaid expenses consisted of the following:

On September 15, 2021, Bennett Buchanan was appointed to serve as a director of BrewBilt Manufacturing, Inc. In connection with Mr. Buchanan’s appointment, the Company agreed to repurchase 10,000 shares of Series A Preferred Stock from Mr. Buchanan issued to him under his Consulting Agreement dated January 1, 2021, for an aggregate purchase price of $100,000, payable in five installments of $20,000 each over the six month period following his appointment as a director. During the nine months ended September 30, 2021, the company recorded a payment of $20,000 in connection with this agreement and will recognize $60,000 in consulting fees in the 4^th quarter of 2021 and $20,000 in the first quarter of 2022.

Property and equipment consisted of the following at ~~June~~September 30, 2021 and December 31, 2020:

	June 30,			December 31,			September 30,			December 31,
	2021			2020			2021			2020
Computer Equipment	$	23,876		$	23,876		$	23,876		$	23,876
Leasehold Improvements		101,371			59,121			106,060			59,121
Machinery		305,245			250,762			349,032			250,762
Software		23,183			17,688			23,183			17,688
Vehicles		6,717			6,717			6,717			6,717
Property, Plant and Equipment, Gross		460,393			358,164			508,868			358,164
Less accumulated amortization		(6,970	)		(702	)		(10,585	)		(702	)
Less accumulated depreciation		(260,955	)		(248,123	)		(263,331	)		(248,123	)
Property, Plant and Equipment, Net	$	192,467		$	109,339		$	234,952		$	109,339

During the nine months ended September 30, 2021, the company recorded fixed assets additions of $247,050 and fixed asset and depreciation disposals of $90,746.

The Company adopted the new lease guidance effective January 1, 2019 using the modified retrospective transition approach, applying the new standard to all of its leases existing at the date of initial application which is the effective date of adoption. Consequently, financial information will not be updated, and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. We elected the package of practical expedients which permits us to not reassess (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for any existing leases as of the effective date. We did not elect the hindsight practical expedient which permits entities to use hindsight in determining the lease term and assessing impairment. The adoption of the lease standard did not change our previously reported consolidated statements of operations and did not result in a cumulative catch-up adjustment to opening equity.

The interest rate implicit in lease contracts is typically not readily determinable. As such, the Company utilizes its incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. In calculating the present value of the lease payments, the Company elected to utilize its incremental borrowing rate based on the remaining lease terms as of the January 1, 2019 adoption date.

Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred, if any. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Our lease has a remaining lease term of less than 4 years.

The Company has elected the practical expedient to combine lease and non-lease components as a single component. The lease expense is recognized over the expected term on a straight-line basis. Operating leases are recognized on the balance sheet as right-of-use assets, current operating lease liabilities and non-current operating lease liabilities.

The new standard also provides practical expedients and certain exemptions for an entity’s ongoing accounting. We have elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases where the initial lease term is one year or less or for which the ROU asset at inception is deemed immaterial, we will not recognize ROU assets or lease liabilities. Those leases are expensed on a straight-line basis over the term of the lease.

On January 1, 2018, the Company entered into a standard office lease for approximately 8,000 square feet of space, located in the Wolf Creek Industrial Building at 110 Spring Hill Dr. #10 Grass Valley, CA 95945. The lease has a term of 10 years, from January 1, 2018 through January 1, 2028, with a monthly rent of $4,861.

On January 1, 2020, the Company terminated the lease agreement dated January 1, 2018, and entered into a new office lease for the same space located in the Wolf Creek Industrial Building at 110 Spring Hill Dr. #10 Grass Valley, CA 95945. The lease has a term of 5 years, from January 1, 2020 through December 31, 2025, with a monthly rent of $4,861.

As of September 30, 2021 and December 31, 2020, ROU assets and lease liabilities related to our operating lease is as follows:

	June,		December 31,		September 30,		December 31,
	2021		2020		2021		2020
Right-of-use assets	$	225,841	$	246,968	$	215,008	$	246,968
Current operating lease liabilities		44,448		42,977		45,203		42,977
Non-current operating lease liabilities		181,393		203,991		169,805		203,991

The following is a schedule, by years, of future minimum lease payments required under the operating lease:

Years Ending
December 31,	Operating Lease		Operating Lease
2021	$	29,167	$	14,584
2022		58,334		58,334
2023		58,334		58,334
2024		58,334		58,334
2025		58,335		58,335
Total		262,504		247,921
Less imputed interest		36,663		32,913
Total liability	$	225,841	$	215,008

As of ~~June~~September 30, 2021 and December 31, 2020, accrued liabilities were comprised of the ~~following~~: following:

Billings in excess of revenue is related to contracted amounts that have been invoiced to customers for which remaining performance obligations must be completed before the Company can recognize the revenue. Earnings in excess of billings is related to the cost of sales associated with the customer ~~products~~jobs that are incomplete.

Changes in unearned revenue for the periods ended ~~June~~September 30, 2021 and December 31, 2020 were as follows:

	June 30,			December 31,			September 30,			December 31,
	2021			2020			2021			2020
Unearned revenue, beginning of the period	$	71,280		$	1,511,096		$	71,280		$	1,511,096
Billings in excess of revenue during the period		2,415,393			71,280			2,524,783			71,280
Recognition of unearned revenue in prior periods		(3,815	)		(1,511,096	)		(566,492	)		(1,511,096	)
Unearned revenue, end of the period	$	2,482,858		$	71,280		$	2,029,571		$	71,280

As of ~~June~~September 30, 2021 and December 31, 2020, the Company has recorded $~~547,366~~598,720 and $489, respectively in earnings in excess of billings for the cost of sales related to customer orders in progress.

As of ~~June~~September 30, 2021 and December 31, 2020, notes payable were comprised of the following:

		Original		Original	Due	Interest	Conversion	June 30,			December 31,				Original		Original	Due	Interest	Conversion	September 30,			December 31,
		Note Amount		Note Date	Date	Rate	Rate	2021			2020				Note Amount		Note Date	Date	Rate	Rate	2021			2020
Auctus Fund #11			113,000	8/19/2020	8/19/2021	12%	Variable		113,000			113,000				113,000	8/19/2020	8/19/2021	12%	Variable		—			113,000
CBP #3			30,000	5/1/2020	5/1/2021	15%	Variable		9,576			30,000				30,000	5/1/2020	5/1/2021	15%	Variable		9,576			30,000
CBP #4			30,000	7/23/2020	7/23/2021	10%	Variable		30,000			30,000				30,000	7/23/2020	7/23/2021	15%	Variable		30,000			30,000
EMA Financial #6			80,500	8/17/2020	5/17/2021	12%	Variable		—			80,500				80,500	8/17/2020	5/17/2021	12%	Variable		—			80,500
EMA Financial #7			50,000	10/21/2020	7/21/2021	12%	Variable		—			50,000				50,000	10/21/2020	7/21/2021	12%	Variable		—			50,000
EMA Financial #8			80,500	5/4/2021	5/4/2022	12%	0.002		80,500			—				80,500	5/4/2021	5/4/2022	16%	0.002		80,500			—
Emerging Corp Cap #1			83,333	2/12/2018	2/11/2019	22%	Variable		—			34,857				83,333	2/12/2018	2/11/2019	22%	Variable		—			34,857
Emerging Corp Cap #2			110,000	10/31/2018	10/31/2019	24%	Variable		110,000			110,000				110,000	10/31/2018	10/31/2019	24%	Variable		110,000			110,000
GPL Ventures #1			25,000	10/14/2020	10/14/2021	10%	Variable		1,240			25,000				25,000	10/14/2020	10/14/2021	10%	Variable		1,240			25,000
GPL Ventures #2			25,000	3/10/2021	3/10/2022	10%	Variable		25,000			—				25,000	3/10/2021	3/10/2022	10%	Variable		25,000			—
GPL Ventures #3			240,000	5/6/2021	5/6/2022	10%	0.001		240,000			—				240,000	5/6/2021	5/6/2022	10%	0.001		240,000			—
Mammoth Corp			33,000	11/19/2020	8/19/2021	0%	Variable		33,000			33,000				33,000	11/19/2020	8/19/2021	18%	Variable		33,000			33,000
Optempus #1			25,000	7/2/2020	7/2/2021	10%	Variable		25,000			25,000				25,000	7/2/2020	7/2/2021	22%	Variable		25,000			25,000
Optempus #2			25,000	7/7/2020	7/2/2021	10%	Variable		25,000			25,000				25,000	7/7/2020	7/2/2021	22%	Variable		25,000			25,000
Optempus #3			15,000	11/24/2020	11/24/2021	10%	Variable		15,000			15,000				15,000	11/24/2020	11/24/2021	10%	Variable		15,000			15,000
Optempus #4			40,000	12/29/2020	12/29/2021	10%	Variable		40,000			40,000				40,000	12/29/2020	12/29/2021	10%	Variable		40,000			40,000
Power Up Lending #14			43,000	7/30/2020	7/30/2021	10%	Variable		—			43,000				43,000	7/30/2020	7/30/2021	10%	Variable		—			43,000
Power Up Lending #15			53,000	9/21/2020	9/21/2021	10%	Variable		—			53,000				53,000	9/21/2020	9/21/2021	10%	Variable		—			53,000
Power Up Lending #16			43,000	10/14/2020	10/14/2021	10%	Variable		—			43,000				43,000	10/14/2020	10/14/2021	10%	Variable		—			43,000
Power Up Lending #17			43,500	12/7/2020	12/7/2021	10%	Variable		—			43,500				43,500	12/7/2020	12/7/2021	10%	Variable		—			43,500
Power Up Lending #18			43,500	1/14/2021	1/14/2022	10%	Variable		43,500			—
Power Up Lending #19			73,500	2/10/2021	2/10/2022	10%	Variable		73,500			—
Power Up Lending #20			53,500	4/5/2021	4/5/2022	10%	Variable		53,500			—				53,500	4/5/2021	4/5/2022	10%	Variable		53,500			—
Power Up Lending #21			53,750	5/3/2021	5/3/2022	10%	Variable		53,750			—				53,750	5/3/2021	5/3/2022	10%	Variable		53,750			—
Power Up Lending #22			43,750	6/11/2021	6/11/2022	10%	Variable		43,750			—				43,750	6/11/2021	6/11/2022	10%	Variable		43,750			—
Power Up Lending #23																43,750	8/11/2021	8/11/2022	10%	Variable		43,750			—
Power Up Lending #24																48,750	9/14/2021	9/14/2022	10%	Variable		48,750			—
Tri-Bridge #1			15,000	5/26/2020	5/26/2021	10%	Variable		15,000			15,000				15,000	5/26/2020	5/26/2021	10%	Variable		15,000			15,000
Tri-Bridge #2			25,000	7/24/2020	7/24/2021	10%	Variable		10,000			10,000				25,000	7/24/2020	7/24/2021	10%	Variable		10,000			10,000
Tri-Bridge #4			25,000	2/24/2021	8/24/2021	10%	Variable		25,000			—				25,000	2/24/2021	8/24/2021	10%	Variable		25,000			—
Tri-Bridge #5			240,000	5/6/2021	5/6/2022	10%	0.001		240,000			—				240,000	5/6/2021	5/6/2022	10%	0.001		240,000			—
								$	1,305,316		$	818,857									$	1,167,816		$	818,857
Debt discount	Debt discount								(867,757	)		(597,670	)	Debt discount								(823,066	)		(597,670	)
Financing costs/Original issue discount	Financing costs/Original issue discount								(112,291	)		(71,199	)	Financing costs/Original issue discount								(77,891	)		(71,199	)
Notes payable, net of discount	Notes payable, net of discount							$	325,268		$	149,988		Notes payable, net of discount							$	266,859		$	149,988

During the ~~six~~nine months ending ~~June~~September 30, 2021, the Company received proceeds from new convertible notes of $~~787,000~~942,000. The Company recorded no payments on their convertible notes and conversions of ~~$417,041~~$727,541 of convertible note principal. The Company recorded loan fees on new convertible notes of $~~116,500~~134,500, which increased the debt discounts recorded on the convertible notes during the ~~six~~nine months ending ~~June~~September 30, 2021. Some of the Company’s convertible notes have a conversion rate that is variable, and therefore, the Company has accounted for their conversion features as derivative instruments (see Note 10). The Company also recorded amortization of $~~734,312~~1,089,415 on their convertible note debt discounts and loan fees. As of ~~June~~September 30, 2021, the convertible notes payable are convertible into ~~1,146,651,690~~1,081,416,121 shares of the Company’s common stock.

During the ~~six~~nine months ended ~~June~~September 30, 2021, the Company recorded interest expense of $~~57,366~~106,270 on its convertible notes payable. During the ~~six~~nine months ended ~~June~~September 30, 2021, the Company recorded conversions of ~~$24,873~~$59,812 of note interest and ~~$3,500~~$6,000 in conversion fees. As of ~~June~~September 30, 2021, the accrued interest balance was $~~102,424~~119,169.

As of ~~June~~September 30, 2021, we have not attained profitable operations and are dependent upon obtaining financing to pursue any extensive acquisitions and activities.

On June 19, 2020, the Company received funding pursuant to a promissory ~~note.~~note in the amount for $108,000 of which $93,090 was received in cash and $14,910 was recorded as transaction fees. The note bears interest of 12% (increases to 24% per annum upon an event of default) and matures on June 19, 2021. As of June 30, 2021, the company has amortized $14,910 of the financing costs to the statement of operations. During the ~~six~~nine months ended ~~June~~September 30, 2021, the Company issued 198,130,434 shares of common stock upon the conversion of principal in the amount of $108,000, accrued interest of $12,960, penalties of $15,000, and conversion fees of $750. As of ~~June~~September 30, 2021, the note has been fully satisfied.

On January 5, 2021, the Company received funding pursuant to a promissory ~~note.~~note in the amount for $50,000of which $39,000was received in cash and $11,000was recorded as transaction fees. The note bears interest of 12% (increases to 16% per annum upon an event of default) and matures on January 5, 2022. As of ~~June~~September 30, 2021, the company has amortized $~~5,304~~8,077 of the financing costs to the statement of operations. As of ~~June~~September 30, 2021, the note has a principal balance of $50,000and accrued interest of $~~2,893~~4,405.

On ~~March 17,~~July 15, 2021, the Company received funding pursuant to a promissory ~~note. for~~note in the amount of $~~80,500~~75,000, of which $~~70,000~~62,500 was received in cash and $~~10,500~~12,500 was recorded as transaction fees. The note bears interest of 12% (increases to 16% per annum upon an event of default) and matures on ~~March 17,~~July 15, 2022. As of ~~June~~September 30, 2021, the company has amortized $~~3,164~~2,637 of the financing costs to the statement of operations. As of ~~June~~September 30, 2021, the note has a principal balance of $~~80,500~~75,000 and accrued interest of $~~2,779~~1,899.

During the ~~six~~nine months ended ~~June~~September 30, 2021, the Company valued the embedded conversion feature of the convertible notes and warrants. The Company uses the Black-Scholes option pricing model to estimate fair value for those instruments convertible into common shares at inception, at conversion or extinguishment date, and at each reporting date.

The following table represents the Company’s derivative liability activity for the embedded conversion features for the ~~six~~nine months ended ~~June~~September 30, 2021:

										September 30,			December 31,
	Notes			Warrants			Total			2021			2020
Balance, beginning of period	$	2,311,296		$	61,880		$	2,373,176		$	2,373,176		$	2,273,269
Initial recognition of derivative liability		3,185,066			126,578			3,311,644			2,870,847			4,142,864
Derivative settlements		387,405			(345,834	)		41,571
Loss (gain) on derivative liability valuation		(4,276,829	)		306,654			(3,970,175	)
Conversion of derivative instruments to Common Stock											(2,300,947	)		(5,230,611	)
Mark-to-Market adjustment to fair value											(306,384	)		1,187,654
Balance, end of period	$	1,606,938		$	149,278		$	1,756,216		$	2,636,692		$	2,373,176

The fair value at the commitment date for the convertible notes and the revaluation dates for the Company’s derivative liabilities were based upon the following management assumptions as of ~~June~~September 30, 2021:

We account for common stock purchase warrants as derivative liabilities and debt issuance costs on the balance sheet at fair value, and changes in fair value during the periods presented in the statement of operations, which is revalued at each balance sheet date subsequent to the initial issuance of the warrant.

On June 19, 2020, the Company executed a Common Stock Purchase Warrant for 5,400,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.02 per share and expire on June 19, 2025.

On July 23, 2020, the Company executed a Common Stock Purchase Warrant for 1,153,846 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.026 per share and expire on July 23, 2025.

On August 19, 2020, the Company executed a Common Stock Purchase Warrant for 5,650,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.02 per share and expire on August 19, 2025.

On January 5, 2021, the Company executed a Common Stock Purchase Warrant for 25,000,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.002 per share and expire on January 5, 2026.

On July 15, 2021, the Company executed a Common Stock Purchase Warrant for 37,500,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.002 per share and expire on July 15, 2026.

On September 14, 2021, the Company executed a Common Stock Purchase Warrant for 50,000,000 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.002 per share and expire on September 14, 2026.

During the ~~six~~nine months ended ~~June~~September 30, 2021, warrant holders exercised the warrants and the Company issued 72,048,517 shares of common stock through a cashless exercise of the warrants in accordance with the conversion terms.

The Company evaluated all outstanding warrants to determine whether these instruments may be tainted. All warrants outstanding were considered tainted.

The fair value at the commitment date for the warrants and the revaluation dates for the Company’s derivative liabilities were based upon the following management assumptions as of ~~June~~September 30, 2021:

Mr. Jef Lewis, Chief Executive Officer, Chairman of the Board, President, Secretary, and Treasurer

On November 22, 2019, the Company appointed Jeffrey Lewis as the new Chief Executive Officer, Chairman of the Board, Corporate President, Secretary, and Treasurer of the Company. The Company and Mr. Lewis entered into an Employee Agreement that included the issuance of 1,000Preferred Series B Control Shares, and an annual salary of $200,000. Unpaid wages will accrue interest at 6% per annum and may be converted to restricted common stock at fair market value at the time of conversion. As of December 31, 2020, Mr. Lewis had an unpaid wage and interest balance of $97,325. During the ~~six~~nine months ended ~~June~~September 30, 2021, the Company accrued wages of $~~100,000~~150,000, interest of $~~1,660~~1,894 and made payments of $~~195,198~~226,354. As of ~~June~~September 30, 2021, the Company owed Mr. Lewis ~~$818~~$19,663 in accrued wages and ~~$2,969~~$3,203 in accrued interest.

The Company is periodically advanced noninterest bearing operating funds from related parties. The advances are due on demand and unsecured. As of ~~June~~September 30, 2021 and December 31, 2020, the Company owed Mr. Lewis $7,171 and $743, respectively, for advances to the Company.

On November 22, 2019, the Company entered into a Consulting Agreement with Mr. Samuel Berry. Mr. Berry will receive an annual salary of $50,000, payable in quarterly installments at $12,500 per quarter. As of December 31, 2020, Mr. Berry had an unpaid balance of $118,167. During the ~~six~~nine months ended ~~June~~September 30, 2021, the Company accrued ~~$25,000~~$37,500 in fees and made ~~$25,000~~$35,000 in payments in connection to his agreement. As of ~~June~~September 30, 2021, the Company owed Mr. Berry $~~$118,167~~120,667 in fees.

As of ~~June~~September 30, 2021 and December 31, 2020, long term debt was comprised of the following:

	June 30,		December 31,		September 30,		December 31,
	2021		2020		2021		2020
Long term debt
Equipment loan		115,614		115,614		41,134		115,614
Line of credit		107,674		104,155		109,475		104,155
Other loans		—		61,588		—		61,588
Total long term debt	$	223,288	$	281,357	$	150,609	$	281,357

In August 2021, the Company returned $96,357 in equipment to the lender to settle debt of $74,480, and a loss on disposal of assets of $16,267 was recorded to the statement of operations.

On May 11, 2020, the Company was granted a loan (the “Loan”) from BSD Capital, LLC dba Lendistry, in the amount of $~~61,558~~,$61,558, pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act, which was enacted March 27, 2020.

The Loan, which was in the form of a Note dated May 11, 2020, issued by the Borrower, matures on May 11, 2022, and bears interest at a rate of 1% per annum, payable monthly commencing on November 11, 2020. The Note may be prepaid by the Borrower at any time prior to maturity with no prepayment penalties. Funds from the Loan may only be used for payroll costs, costs used to continue group health care benefits, mortgage payments, rent, utilities, and interest on other debt obligations. The Company intends to use the entire Loan amount for qualifying expenses. Under the terms of the PPP, certain amounts of the Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act.

On May 3, 2021, the PPP loan was forgiven and the loan amount of $~~61,558~~$61,558 was reclass as debt forgiveness on the statement of operations.

On March 28, 2017, the Company filed an amendment to its articles of incorporation designating 20,000 shares of its authorized preferred stock, par value $0.001 as Series B Voting Preferred Stock. The Series B Voting Preferred Stock shall have the right to vote the shares on any matter requiring shareholder approval on the basis of 4 times the votes of all the issued and outstanding shares of common stock, as well as any issued and outstanding preferred stock.

On July 1, 2019, the Company filed a Certificate of Amendment to increase the number of authorized Series A Preferred Stock to 30,000,000, with a par value of $0.001. Each share of Preferred Series A Stock shall have a value of $10 per share and will convert into common stock at the closing price of the common stock on the date of conversion. The Series A stock shall have no voting rights on corporate matters, unless and until the Series A shares are converted into Common Shares, at which time they will have the same voting rights as all Common Shareholders have; their consent shall not be required for taking any corporate action.

Pursuant to the Merger Agreement dated November 22, 2019, the Company will issue $5,000,000 worth of Preferred Series A Stock to Mr. Lewis. The number of Preferred Series A shares to be issued is 500,000 shares at a price of $10.00 per share and convertible pursuant the conversion rights as specified in the Articles of Incorporation and Certificate of Designation for the Company. As of December 31, 2019, the shares had not been issued, and the Company recorded a liability for unissued shares in the amount of $500, goodwill of $2,289,884 and $2,289,334 to additional paid in capital.

On March 1, 2020, 500,000 shares of Preferred Series A Shares were issued pursuant to the Merger Agreement, and a $500 liability for unissued shares was reclassed to equity.

On April 6, 2020, the Company executed an addendum to the Distribution & Licensing Agreement dated November 19, 2019, with Bgreen Partners, Inc. The Company issued 400,000 Preferred Series A shares at a price of $10.00 per share which are convertible pursuant the conversion rights as specified in the Articles of Incorporation and certificate of designation for the Company.

On October 15, 2020, the Company entered into an IP Purchase and License Agreement with Maguire & Associates, LLC in the amount of $5,000,000. The Company issued 500,000 Preferred Series A shares at a price of $10.00 per share which are convertible pursuant the conversion rights as specified in the Articles of Incorporation and certificate of designation for the Company.

On November 20, 2020, Mr. Lewis converted 70,000,000 common shares at a price of $.0018 per share into 54,000 Preferred Series A Shares at a price of $10 per share. The conversion resulted in a loss of $414,000 which was recorded to the statement of operations.

During the year ended December 31, 2020, 734,000 shares of Series A Preferred stock were converted to 2,416,667,054 common shares in accordance with the conversion terms. The issuances resulted in a loss on conversion of $1,572,272 which was recorded to the statement of operations.

On January 1, 2021, the Company issued 10,000 shares of Series A Preferred stock at $10 per share to Bennett Buchanan, pursuant to his Consulting Agreement.

On April 13, 2021, the Company issued 10,000 shares of Series A Preferred stock to key employee Corbin Boyle at $10 per share.

On April 13, 2021, the Company issued 10,000 shares of Series A Preferred stock to key employee Jesse Prim at $10 per share.

On May 14, 2021, the Company issued 14,497 shares of Series A Preferred stock at $10 per share, to settle liabilities of $144,970.

On September 15, 2021, the Company repurchased 10,000 shares of Series A Preferred stock at $10 per share from Bennett Buchanan, pursuant to his Director Agreement. The shares were purchased for $100,000, which is payable in five installments of $20,000 each over the six-month period following his appointment as a director.

During the ~~six~~nine months ended ~~June~~September 30, 2021, ~~285,000~~ 357,500shares of Series A Preferred stock were converted to ~~1,150,055,242~~ 1,780,120,601common shares in accordance with the conversion terms. The issuances ~~was~~were valued at $~~1,583,148.~~1,845,925.

As of ~~June~~September 30, 2021, 30,000,000 Series A Preferred shares and 1,000 Series B Preferred shares were authorized, of which ~~879,497~~796,997 Series A shares were issued and outstanding, and 1,000 Series B shares were issued and outstanding.

On April 22, 2019, the Company approved the authorization of a 1 for 3,000 reverse stock split of the Company’s outstanding shares of common stock. The Company’s financial statements have been retroactively adjusted for this stock split for all periods presented.

During the year ended December 31, 2019, the holder of a convertible note converted $1,148 of accrued interest and $500 in conversion fees into 400,000 shares of common stock. The common stock was valued at $5,077 based on the market price of the Company’s stock on the date of conversion.

On March 17, 2020, the Company’s former President cancelled 8,008,334 shares of common stock issued to settle debt of $25,342 and $25,000 in stock based compensation pursuant to an employee agreement. The cancellation resulted in a liability of unissued shares of $25,000 and an increase in related party liabilities of $25,342. On December 31, 2020, Mr. Rushford agreed to forgive the debt and $50,342 was recorded to additional paid in capital.

On March 25, 2020, the Company filed a Certificate of Amendment to increase the number of authorized common shares from 5,000,000,000 to 10,000,000,000 with a par value of $0.001.

On December 4, 2020, the Company filed a Certificate of Amendment to increase the number of authorized common shares from 10,000,000,000 to 20,000,000,000 with a par value of $0.001.

During the year ended December 31, 2020, the holders of a convertible notes converted $1,388,809 of principal, $351,376 of accrued interest and $39,275 in conversion fees into 1,023,817,685 shares of common stock. The common stock was valued at $8,141,166 based on the market price of the Company’s stock on the date of conversion.

`On June 10, 2021, the Company filed a Certificate of Amendment to increase the number of authorized common shares from 20,000,000,000 to 25,000,000,000 with a par value of $0.001.

During the ~~six~~nine months ended June 30, 2021, warrant holders exercised the warrants and the Company issued 72,048,517 shares of common stock through a cashless exercise of the warrants in accordance with the conversion terms.

During the ~~six~~nine months ended ~~June~~September 30, 2021, ~~285,000~~357,500 shares of Series A Preferred stock were converted to ~~1,150,055,242~~1,780,120,601 common shares in accordance with the conversion terms. The ~~issuance was~~issuances were valued at $~~1,583,148.~~1,845,925.

During the ~~six~~nine months ended ~~June~~September 30, 2021, the holders of a convertible notes converted ~~$417,042~~$727,541 of principal, ~~$24,873~~$59,812 of accrued interest and ~~$3,500~~$6,000 in conversion fees into ~~506,477,278~~853,979,114 shares of common stock. The common stock was valued at ~~$3,215,621~~$3,268,543 based on the market price of the Company’s stock on the date of conversion.

During the ~~six~~nine months ended ~~June~~September 30, 2021, the holder of a promissory notes converted $108,000 of principal, $12,960 of accrued interest, $15,000 in penalties, and $750 in conversion fees into 198,130,434 shares of common stock. The common stock was valued at $594,391 based on the market price of the Company’s stock on the date of conversion.

As of ~~June~~September 30, 2021, 25,000,000,000 were authorized, of which ~~5,460,733,926~~6,438,301,121 shares are issued and outstanding.

Deferred income taxes are determined using the liability method for the temporary differences between the financial reporting basis and income tax basis of the Company’s assets and liabilities. Deferred income taxes are measured based on the tax rates expected to be in effect when the temporary differences are included in the Company’s tax return. Deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases.

The deferred tax asset and the valuation allowance consist of the following at ~~June~~September 30, 2021:

On January 1, 2021, the Company entered into a Consulting Agreement with Bennett Buchanan to assist with marketing, advertising, customer relations, and licensing and compliance regulatory requirements. The term of the Agreement is for two years and may be terminated or extended upon mutual agreement of both parties pursuant with a thirty-day written notice. The Company will pay the Consultant a monthly fee of $~~3,000~~$3,000 and $~~100,000~~$100,000 in Series A Stock during the term of the agreement. In addition, the Consultant will receive a 2% commission on gross sales for each customer sale closed by the Consultant.

On September 15, 2021, Bennett Buchanan was appointed to serve as a director of BrewBilt Manufacturing, Inc. Mr. Buchannan currently serves as a consultant to the Company under a Consulting Agreement dated January 1, 2021, pursuant to which he assists the Company with marketing, advertising, customer relations, and licensing and compliance regulatory requirements. Pursuant to the Consultant Agreement, Mr. Buchanan is paid a monthly fee of $3,000, and was previously issued 10,000 shares of the Company’s Series A Stock.

In connection with Mr. Buchanan’s appointment, the Company agreed to repurchase the 10,000 shares of Series A Preferred Stock of the Company from Mr. Buchanan issued to him under the Consulting Agreement for an aggregate purchase price of $100,000, payable in five installments of $20,000 each over the six month period following his appointment as a director. During the nine months ended September 30, 2021, the company recorded a payment of $20,000 in connection with this agreement and will recognize $60,000 in consulting fees in the 4^thquarter of 2021 and $20,000 in the first quarter of 2022.

On January 1, 2020, the Company entered into a new office lease for space located in the Wolf Creek Industrial Building at 110 Spring Hill Dr. #10 Grass Valley, CA 95945. The lease has a term of 5 years, from January 1, 2020 through December 31, 2025, with a monthly rent of $4,861.

On June 12, 2018, the Company entered into a preventative maintenance service agreement with Atlas Copco Compressions LLC. The agreement is for a period of 5 years, at a cost of $145.13 per month.

On October 6, 2021, the Company entered into a Promissory Note in the amount of $550,000. The note is unsecured, bears interest at 12% per annum, and matures on October 6, 2022. The Company also executed a Common Stock Purchase Warrant for 366,666,667 shares. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price of $0.0015 per share and expire on October 6, 2026.

On ~~July 7, 2021,~~ ~~25,000~~ ~~shares of Preferred Series A stock was converted into~~ ~~163,398,693~~ ~~shares of common stock.~~

~~On July 7, 2021,~~ ~~10,000~~ ~~shares of Preferred Series A stock was converted into~~ ~~133,333,333~~ ~~shares of common stock.~~

~~On July 19,~~October 6, 2021, the holder of a convertible note converted a total of $~~28,000~~56,175 of principal and interest into ~~28,571,429~~59,131,579 shares of our common stock.

On ~~July 20,~~October 6, 2021, 15,000 shares of Preferred Series A stock was converted into 150,000,000 shares of common stock.

On October 8, 2021, 22,500 shares of Preferred Series A stock was converted into 125,000,000 shares of common stock.

On October 28, 2021, 13,500 shares of Preferred Series A stock was converted into 100,000,000 shares of common stock.

On November 8, 2021, the holder of a convertible note converted a total of $~~17,675~~56,438 of principal and interest into ~~18,605,263~~77,311,644 ~~shares of our common stock.~~

~~On July 26, 2021, the holder of a convertible note converted a total of $133,178~~ ~~of principal, interest, and fees into~~ ~~83,236,375~~ shares of our common stock.

The Company has evaluated subsequent events pursuant to ASC Topic 855 and has determined that there are no additional subsequent events to disclose.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

The following discussion and analysis summarizes the significant factors affecting our consolidated results of operations, financial condition, and liquidity position for the three and ~~six~~nine months ended June 30, 2021. This discussion and analysis should be read in conjunction with our audited financial statements and notes thereto included in our Annual Report on Form 10-K for our year-ended December 31, 2020 and the consolidated unaudited financial statements and related notes included elsewhere in this filing. The following discussion and analysis contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements.

This quarterly report contains forward-looking statements relating to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “intends”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential”, or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors which may cause our or our industry’s actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance. You should not place undue reliance on these statements, which speak only as of the date that they were made. These cautionary statements should be considered with any written or oral forward-looking statements that we may issue in the future. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results, later events, or circumstances or to reflect the occurrence of unanticipated events.

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

The management’s discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

As used in this quarterly report, the terms “we”, “us”, “our”, and “our company” means BrewBilt Manufacturing, Inc., unless otherwise indicated.

Results for the Three Months Ended ~~June~~September 30, 2021 Compared to the Three Months Ended ~~June~~September 30, 2020

The Company’s revenues were ~~$48,764~~$575,128 for the three months ended ~~June~~September 30, 2021 compared to ~~$56,554~~$927,012 for the three months ended ~~June~~September 30, 2020. The decrease is due to fewer projects being completed and delivered to customers in Q2Q3 2021. In addition, the average revenue per job for the customer orders that were completed were lower in Q2Q3 2021 compared to Q2Q3 2020.

The Company’s cost of materials was ~~$8,501~~$357,429 for the three months ended ~~June~~September 30, 2021, compared to ~~$35,647~~$163,525 for the three months ended ~~June~~September 30, 2020. The increase is primarily due to a significant increase in the cost of materials as well as a higher number of smaller customer orders with low profit margins.

Operating expenses consisted primarily of consulting fees, professional fees, salaries and wages, office expenses and fees associated with preparing reports and SEC filings relating to being a public company. Operating expenses for the three months ended September 30, 2021, and September 30, 2020, were $249,912 and $212,934, respectively. The increase is due to an increase in salaries and wages and general and administrative expenses.

Other income (expense) for the three months ended September 30, 2021 and September 30, 2020 was $(1,486,655) and $(755,797), respectively. Other income (expense) consisted of losses on derivative valuation, losses on conversion on preferred stock to common stock and interest expense. The loss on derivative valuation is directly attributable to the change in fair value of the derivative liability. Interest expense is primarily attributable the initial interest expense associated with the valuation of derivative instruments at issuance and the accretion of the convertible debentures over their respective terms. The increase primarily resulted from a loss on fair value of derivative liabilities during the three months ended September 30, 2021, whereas there was a gain reported during the three months ended September 30, 2020.

Net loss for the three months ended September 30, 2021 was $1,518,878 compared with $212,044 for the three months ended September 30, 2020. The increased loss is due to a decrease in income and an increase in derivative expenses for the three months ended September 30, 2021.

Results for the Nine Months Ended September 30, 2021 Compared to the Nine Months Ended September 30, 2020

The Company’s revenues were $637,143 for the nine months ended September 30, 2021 compared to $1,022499 for the nine months ended September 30, 2020. The decrease is due to ~~a cancelled order whereby~~fewer projects being completed and delivered to customers. In addition, the average revenue per job for the customer orders that were completed were lower during the nine months ended September 30, 2021 compared to September 30, 2020.

The Company’s cost of materials was ~~charged~~$373,544 for the nine months ended September 30, 2021, compared to $220,795 for the nine months ended September 30, 2020. The increase is primarily due to a ~~10% penalty. Since~~significant increase in the ~~order was cancelled, there were no labor or material expenses incurred.~~cost of materials as well as a higher number of smaller customer orders with low profit margins.

Operating expenses consisted primarily of consulting fees, professional fees, salaries and wages, office expenses and fees associated with preparing reports and SEC filings relating to being a public company. Operating expenses for the ~~three~~nine months ended ~~June~~September 30, 2021, and ~~June~~September 30, 2020, were ~~$460,072~~$1,113,985 and ~~$4,242,534,~~$4,757,958, respectively. The decrease is primarily attributable to ~~share based~~share-based consulting fees that were incurred during the ~~three~~nine months ended ~~June~~September 30, 2020.

Other income (expense) for the ~~three~~nine months ended ~~June~~September 30, 2021 and ~~June~~September 30, 2020 was ~~$(1,140,358)~~$(4,866,417) and ~~$(2,265,746)~~$(4,872,752), respectively. Other income (expense) consisted of losses on derivative valuation, losses on conversion on preferred stock to common stock and interest expense. The loss on derivative valuation is directly attributable to the change in fair value of the derivative liability. Interest expense is primarily attributable the initial interest expense associated with the valuation of derivative instruments at issuance and the accretion of the convertible debentures over their respective terms. The decrease in other expense primarily resulted from a ~~gain on fair value of~~decrease in derivative ~~liabilities~~expenses during the ~~three~~nine months ended ~~June~~September 30, ~~2021, whereas there was a loss reported during the three months ended June 30, 2020.~~2021.

Net loss for the ~~three~~nine months ended ~~June~~September 30, 2021 was ~~$1,560,167~~$5,716,803 compared with ~~$6,487,373~~$8,835,806 for the ~~three~~nine months ended ~~June~~September 30, 2020. The decreased loss can be explained by the issuance of share-based consulting fees and ~~the~~an increase in loss in fair value of derivative liabilities for the ~~three~~nine months ended ~~June 30, 2020.~~

~~Results for the Six Months Ended June 30, 2021 Compared to the Six Months Ended June 30, 2020~~

The Company’s revenues were $62,015 for the six months ended June 30, 2021 compared to $95,488 for the six months ended June 30, 2020. The decrease is due to fewer projects being completed and delivered to customers. In addition, the average revenue per job for the customer orders that were completed were lower during the six months ended June 30, 2021 compared to June 30, 2020.

The Company’s cost of materials was $16,115 for the six months ended June 30, 2021, compared to $57,270 for the six months ended June 30, 2020. The decrease is due to fewer projection being completed and delivered as well as a cancelled order whereby the customer was charged a 10% penalty. Since the order was cancelled, there were no labor or material expenses incurred.

Operating expenses consisted primarily of consulting fees, professional fees, salaries and wages, office expenses and fees associated with preparing reports and SEC filings relating to being a public company. Operating expenses for the six months ended June 30, 2021, and June 30, 2020, were $864,073 and $4,545,025, respectively. The decrease is primarily attributable to share-based consulting fees that were incurred during the six months ended June 30, 2020.

Other income (expense) for the six months ended June 30, 2021 and June 30, 2020 was $(3,379,752) and $(4,116,955), respectively. Other income (expense) consisted of losses on derivative valuation, losses on conversion on preferred stock to common stock and interest expense. The loss on derivative valuation is directly attributable to the change in fair value of the derivative liability. Interest expense is primarily attributable the initial interest expense associated with the valuation of derivative instruments at issuance and the accretion of the convertible debentures over their respective terms. Although there was an increase in loss of conversion for the six months ended June 30, 2021, the decrease in other expense primarily resulted from an increase in the loss in fair value of derivative liabilities during the six months ended June 30, 2020.

Net loss for the six months ended June 30, 2021 was $4,197,925 compared with $8,623,762 for the six months ended June 30, 2020. The decreased loss can be explained by the issuance of share-based consulting fees and the loss in fair value of derivative liabilities for the six months ended JuneSeptember 30, 2020.

We believe that the rate of inflation has had a negligible effect on our operations.

	June 30, 2021			December 31, 2020			September 30, 2021			December 31, 2020
	$			$			$			$
Current Assets		2,721,064			223,729			2,390,838			223,729
Current Liabilities		5,916,832			4,281,072			6,543,983			4,281,072
Working Capital (Deficit)		(3,195,768	)		(4,057,343	)		(4,153,145	)		(4,057,343	)

As of ~~June~~September 30, 2021, the Company had ~~$287,757~~$275,800 and ~~$2,721,064~~$2,390,838 in cash and total current assets, as well as ~~$5,916,832~~$6,543,983 in current liabilities as compared to $72,764 and $223,729 in cash and total current assets, and $4,281,072 in current liabilities as of December 31, 2020. The ~~increase~~decrease in working capital is due to an increase in ~~cash on hand due to funds from notes payable,~~billings in excess of revenue and ~~an increase in accounts receivable~~derivative liabilities for ~~new sales closed during~~ the ~~six~~nine months ended ~~June~~September 30, 2021.

The Company requires additional capital to fully execute its marketing program and increase revenues. There can be no assurance that continued funding will be available on satisfactory terms. We intend to raise additional capital through the sale of equity, loans, or other short-term financing options.

	June 30, 2021			June 30, 2020			September 30, 2021			September 30, 2020
	$			$			$			$
Cash Flows from (used in) Operating Activities		(404,799	)		(512,867	)		(763,112	)		(801,935	)
Cash Flows from (used in) Investing Activities		(102,228	)		21,834			(156,304	)		30,839
Cash Flows from (used in) Financing Activities		722,020			498,366			1,122,452			849,710
Net Increase (decrease) in Cash During Period		214,993			7,333			203,036			78,614

During the ~~six~~nine months ended ~~June~~September 30, 2021, cash from (used in) operating activities was ~~$(404,799)~~$(763,112) compared to ~~$(512,867)~~$(801,936) for the ~~six~~nine months ended ~~June~~September 30, 2020. The variance primarily resulted from the change in fair value of derivative liabilities and share-based compensation during the ~~six~~nine months ended ~~June~~September 30, 2020.

During the ~~six~~nine months ended ~~June~~September 30, 2021, cash from investing activities was ~~$(102,228)~~$(156,304) compared to ~~$21,834~~$30,839 for the ~~six~~nine months ended ~~June~~September 30, 2020. The variance in cash from investing activity is due to an increase in fixed assets ~~purchased~~purchases and disposals in the ~~six~~nine months ended ~~June~~September 30, 2021.

During the ~~six~~nine months ended ~~June~~September 30, 2021, cash from (used in) financing activities was ~~$722,020~~$1,122,452 compared to ~~$498,366~~$849,710 for the ~~six~~nine months ended ~~June~~September 30, 2020. The increase in cash from financing activity is due to an increase in proceeds from convertible debt and promissory notes during the ~~six~~nine months ended ~~June~~September 30, 2021.

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

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

The preparation of our financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments which are based on historical experience and on various other factors that are believed to be reasonable under the circumstances. The results of their evaluation form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions and circumstances. Our significant accounting policies are more fully discussed in the Notes to our Financial Statements, included herein.

A smaller reporting company is not required to provide the information required by this Item.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our president and chief financial officer (our principal executive officer, principal financial officer and principal accounting officer) to allow for timely decisions regarding required disclosure.

As of the end of the quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president and chief financial officer (our principal executive officer, principal financial officer, and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president and chief financial officer (our principal executive officer, principal financial officer, and principal accounting officer) concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this quarterly report. Our company is in the process of adopting specific internal control mechanisms to ensure effectiveness as we grow, and we will work to retain additional qualified individuals to ensure a proper segregation of duties. We have engaged an outside consultant to assist in adopting new measures to improve upon our internal controls. Future controls, among other things, will include more checks and balances and communication strategies between the management and the board, once we are able to secure additional board members, to ensure efficient and effective oversight over company activities as well as more stringent accounting policies to track and update our financial reporting.

There were no changes in our internal control over financial reporting during the quarterly period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We know of no material, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers, or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our company.

A smaller reporting company is not required to provide the information required by this Item.

On ~~April 13,~~September 15, 2021, the Company ~~issued~~repurchased 10,000 ~~shares of Series A Preferred stock to key employee Corbin Boyle at $10 per share.~~

~~On April 13, 2021, the Company issued 10,000 shares of Series A Preferred stock to key employee Jesse Prim at $10 per share.~~

~~On May 14, 2021, the Company issued 14,497~~ shares of Series A Preferred stock at $10 per share that were issued to ~~settle liabilities of $144,970.~~

~~On June 6, 2021, the holder of~~Bennett Buchanan pursuant to a promissory notes converted $108,000 of principal, $12,960 of accrued interest, $15,000 in penalties, and $750 in conversion fees into 198,130,434 shares of common stock. The common stock was valued at $594,391 based on the market price of the Company’s stock on the date of conversion.Consulting Agreement.

During the three months ended ~~June~~September 30, 2021, ~~112,500~~72,500 shares of Series A Preferred stock were converted to ~~579,755,748~~630,065,359 common shares in accordance with the conversion terms. The issuances resulted in a loss on conversion of ~~$796,833~~$262,778 which was recorded to the statement of operations.

During the three months ended ~~June~~September 30, 2021, the holders of a convertible notes converted ~~$160,260~~$310,500 of principal, ~~$8,688~~$34,938 of accrued interest and ~~$1,000~~$2,500 in conversion fees into ~~331,416,690~~347,501,836 shares of common stock. The common stock was valued at ~~$997,894~~$647,343 based on the market price of the Company’s stock on the date of conversion.

In respect of the aforementioned convertible loan agreement(s) and the underlying shares, as well as shares issued to a director and consultant, the Company will claim an exemption from the registration requirements of the Securities Act of 1933, as amended, for the issuance of the shares pursuant to Section 4(2) of the Act and/or Rule 506 of Regulation D promulgated thereunder since, among other things, the transaction does not involve a public offering, the purchasers are “accredited investors” and/or qualified institutional buyers, the purchasers have access to information about the Company and its purchase, the purchasers will take the securities for investment and not resale.

Other than as disclosed above, there were no unregistered securities to report which were sold or issued by the Company without the registration of these securities under the Securities Act of 1933 in reliance on exemptions from such registration requirements, within the period covered by this report, which have not been previously included in a Quarterly Report on Form 10-Q or a Current Report on Form 8-K.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Florida				47-0990750
(State or other jurisdiction of incorporation)				(I.R.S. Employer Identification No.)

Large accelerated filer o	Accelerated filer o
Non-accelerated Filer o (Do not check if a smaller reporting company)	Smaller reporting company x
	Emerging growth company x

		Page
	PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements	3

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2224

Item 3.	Quantitative and Qualitative Disclosure about Market Risk	2527

Item 4.	Controls and Procedures	2527

	PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	2628

Item 1A.	Risk Factors	2628

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2628

Item 3.	Defaults Upon Senior Securities	2629

Item 4.	Mine Safety Disclosures	2729

Item 5.	Other Information	2729

Item 6.	Exhibits	2729

	SIGNATURES	2830

		Page
Balance Sheets (Unaudited)		4
Statements of Operations and Comprehensive Loss (Unaudited)		5
Statements of Shareholders’ Deficit (Unaudited)		6
Statements of Cash Flows (Unaudited)		7
Notes to Financial Statements		~~8-21~~8-23

	June 30,		December 31,
	2021		2020
Accrued liabilities
Accrued wages	$	31,294	$	123,663
Credit card		2,895		19,893
Customer deposits		—		103,550
Sales tax payable		108,139		34,891
Warranty		5,000		5,000
Total accrued expenses	$	147,328	$	286,997

	Valuation date
Expected dividends		0%
Expected volatility		~~110.08%~~113.06% - ~~268.13%~~291.74%
Expected term		~~.12~~.07 - 1 year
Risk free interest		~~.01%~~.04% - ~~.11%~~.12%

	June 30,
	2021
Net operating loss	$	617,550
Statutory rate		21	%
Expected tax recovery		129,686
Change in valuation allowance		(129,686	)
Income tax provision	$	—

Components of deferred tax asset:
Non-capital tax loss carry-forwards		129,686
Less: valuation allowance		(129,686	)
Net deferred tax asset	$	—

Exhibit Number
Exhibit Number		Description
31.1		Certification of the Chief Executive Officer required under Rule 13a-14(a)/15d-14(a) of the Exchange Act*
31.2		Certification of the Chief Financial Officer required under Rule 13a-14(a)/15d-14(a) of the Exchange Act*
32.1		Certification of the Chief Executive Officer and Chief Financial Officer required under Section 1350 of the Exchange Act*
101.INS		XBRL Instance Document*
101.SCH		XBRL Taxonomy Extension Schema*
101.CAL		XBRL Taxonomy Extension Calculation Linkbase*
101.DEF		XBRL Taxonomy Extension Definition Linkbase*
101.LAB		XBRL Taxonomy Extension Label Linkbase*
101.PRE		XBRL Taxonomy Extension Presentation Linkbase*

	BrewBilt Manufacturing Inc.

Date: ~~August 16,~~November 15, 2021	By: /s/ Jef Lewis

	Chief Executive Officer