Delaware
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75-2100622
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(State or other jurisdiction of
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(IRS Employer Identification No.)
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incorporation or organization)
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117 West 9
th
Street Suite 316
Los Angeles California
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90015
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
☐
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Accelerated filer
☐
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Non-accelerated filer
☐
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Smaller reporting company
☒
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(Do not check if smaller reporting company)
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Emerging growth company
☐
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PART I. – FINANCIAL INFORMATION
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|
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Item 1. Financial Statements
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4
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
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18
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Item 3. Quantitative and Qualitative Disclosures about Market Risk
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23
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Item 4. Controls and Procedures
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24
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PART II. – OTHER INFORMATION
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Item 1. Legal Proceedings
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25
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Item 1A. Risk Factors
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25
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
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29
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Item 3. Defaults Upon Senior Securities
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26
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Item 4. Mine Safety Disclosures
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26
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Item 5. Other Information
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27
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Item 6. Exhibits
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28
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Signatures |
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||||||||||||||||
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For the Three Months
Ended June 30,
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For the Six Months
Ended June 30,
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||||||||||||||
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2017
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2016
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2017
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2016
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||||||||||||
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||||||||||||||||
Sales, net of discounts
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$
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-
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$
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3,780
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-
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3,780
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||||||||||
Cost of Goods Sold
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-
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(2,020
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)
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-
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(2,020
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)
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||||||||||
Gross Profit
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-
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1,760
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-
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1,760
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||||||||||||
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||||||||||||||||
Operating Expenses
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||||||||||||||||
Selling, general and administrative
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101,028
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102,571
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205,725
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130,140
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||||||||||||
Penalty on Payroll Taxes
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12,807
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-
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12,807
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|||||||||||||
Depreciation expense
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998
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998
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1,997
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1,997
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||||||||||||
Financing Cost
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-
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-
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22,500
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-
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||||||||||||
Salaries and wages
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6,437
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11,859
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6,437
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19,496
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||||||||||||
Operating Expenses/(Loss)
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121,270
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115,428
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249,466
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151,633
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||||||||||||
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||||||||||||||||
Loss from Operations
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(121,270
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)
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(113,668
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)
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(249,466
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)
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(149,873
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)
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||||||||
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||||||||||||||||
Other Non-Operating Income and Expenses
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||||||||||||||||
License Fees Income/Expenses
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-
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(154,500
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)
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-
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(154,500
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)
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||||||||||
Interest expense
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(9,898
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)
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(5,500
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)
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(16,439
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)
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(5,500
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)
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||||||||
Forgiveness of Debt
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2,449
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6,849
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-
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|||||||||||||
Extraordinary Items
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-
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15,042
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-
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|||||||||||||
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||||||||||||||||
Net Income/(Loss) before Income Taxes
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(128,719
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)
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(273,668
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)
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(244,014
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)
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(309,873
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)
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||||||||
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||||||||||||||||
Provision for income taxes
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-
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-
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-
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-
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||||||||||||
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||||||||||||||||
Net Income/(Loss)
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$
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(128,719
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)
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$
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(273,668
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)
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(244,014
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)
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(309,873
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)
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||||||
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||||||||||||||||
Basic and Diluted Loss per Share - Common Stock
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$
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(0.00374
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)
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$
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(0.00
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)
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(0.01
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)
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(0.01
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)
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||||||
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||||||||||||||||
Weighted Average Number of Shares Outstanding:
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||||||||||||||||
Basic and Diluted Common Stock
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34,437,000
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26,399,864
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34,437,000
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26,399,864
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For the Six Months Ended
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|||||||
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June 30,
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|||||||
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2017
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2016
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||||||
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||||||||
OPERATING ACTIVITIES
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||||||||
Net loss
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$
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(244,014
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)
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$
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(309,873
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)
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Adjustments to reconcile net loss to
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||||||||
net cash used in operating activities:
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||||||||
Shares issued for services
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-
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-
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||||||
Depreciation
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-
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1,996
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||||||
Changes in operating assets and liabilities
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||||||||
Accounts receivable
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(5,406
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)
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||||||
Inventory
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-
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2,020
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||||||
Deposits
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-
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4,880
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||||||
Accounts payable
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(16,373
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)
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3,694
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|||||
Proceeds from notes payable
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-
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|||||||
Repayment of notes payable
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88,047
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- | ||||||
Accrued expenses
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38,517
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- | ||||||
Unearned Revenue
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(18,750
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)
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||||||
Net Cash Used in Operating Activities
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(139,229
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)
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(316,033
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)
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INVESTING ACTIVITIES
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||||||||
Accumulated Depreciation
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1,997
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-
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||||||
Disposal of fixed asset
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-
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-
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||||||
Net Cash Provided By (Used In) Investing Activities
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1,997
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-
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||||||
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FINANCING ACTIVITIES
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||||||||
Proceeds from notes payable
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10,000
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-
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||||||
Repayment of notes payable
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(352,333
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)
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-
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|||||
Notes Converted to equity
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412,333
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|||||||
Common stock issued for cash
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41,863
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97,109
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||||||
Proceeds from related party notes payable
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-
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175,155
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||||||
Prior period adjustment to retained earnings
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-
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-
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||||||
Inventory Deposit
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100,000
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|||||||
Repayment on the leases payable
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-
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-
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||||||
Repayment of note payable - related party
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Net Cash Provided by Financing Activities
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111,863
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372,264
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||||||
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||||||||
NET INCREASE (DECREASE) IN CASH
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(25,369
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)
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56,231
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|||||
CASH AT BEGINNING OF PERIOD
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25,284
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210
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||||||
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||||||||
CASH AT END OF PERIOD
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$
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(85
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)
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$
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56,441
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||||||||
SUPPLEMENTAL DISCLOSURES OF
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||||||||
CASH FLOW INFORMATION:
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||||||||
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||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
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||||||||
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||||||||
CASH PAID FOR:
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||||||||
Interest
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$
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-
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$ | |||||
NON CASH FINANCING ACTIVITIES:
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Issuance of shares for debt conversion
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$
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-
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$ |
June 30,
2017
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December 31,
2016
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|||||||
Computers
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$
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15,986
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$
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15,986
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||||
Freezers
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39,153
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39,153
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||||||
Office Furniture
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15,687
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15,687
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||||||
Rugs
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6,000
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6,000
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||||||
Software - Accounting
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2,901
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2,901
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||||||
Telephone System
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5,814
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5,814
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||||||
Video Camera
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1,528
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1,528
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||||||
Accumulated Depreciation
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(57,227
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)
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(55,231
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)
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||||
Net Book Value
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$
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29,841
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$
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31,838
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Noteholder
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Note Amount
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Issuance Date
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Unpaid Amount
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||||||
S. Masjedi
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$
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150,000
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12/10/2010
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$
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122,692
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||||
A. Masjedi
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500,000
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6/1/2013
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192,772
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||||||
M. Shenkman
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10,000
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2/21/2012
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10,000
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||||||
M. Shenkman
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10,000
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2/23/2102
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10,000
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||||||
M. Shenkman
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10,000
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3/14/2013
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6,000
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||||||
M. Shenkman
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16,000
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9/9/2014
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16,000
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||||||
Total
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$
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696,000
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$
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357,464
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Note Amount
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Issuance Date
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Unpaid Amount
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|||||||
$
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10,000
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February 2014
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$
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1,000
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|||||
172,500
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9/30/2017
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172,500
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|||||||
50,000
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9/30/2017
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50,000
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|||||||
50,000
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9/30/2017
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50,000
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|||||||
15,000
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7/22/2013
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15,000
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|||||||
86,821
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3/14/2013
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86,821
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|||||||
30,000
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2/1/2012
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25,000
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|||||||
500,000
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5/19/2014
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175,000
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|||||||
-
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25,000
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||||||||
Total:
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$
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914,321
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$
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600,321
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As of June 30, 2017
|
As of December 31, 2016
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|||||||||||||||
Current
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Long Term
|
Current
|
Long Term
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|||||||||||||
Notes Payable - Related
|
$
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110,281
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$
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205,183
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$
|
110,081
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$
|
404,636
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||||||||
Notes Payable
|
313,500
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328,821
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26,510
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671,154
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||||||||||||
Total
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423,781
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534,004
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136,591
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1,075,790
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· |
we do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act");
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· |
we do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our limited size and early stage nature of operations, segregation of all conflicting duties may not always be possible and may not be economically feasible; however, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals;
|
· |
we do not have an independent audit committee of our Board of Directors;
|
· |
insufficient monitoring and review controls over the financial reporting closing process, including the lack of individuals with current knowledge of GAAP that led to the restatement of our previously issued financial statements; and
|
· |
we continue to outsource the functions of controller on an interim basis to assist us in implementing the necessary financial controls over the financial reporting and the utilization of internal management and staff to effectuate these controls.
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PACIFIC VENTURES GROUP, INC.
|
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Date: November 7, 2017
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By:
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/s/ Shannon Masjedi
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Shannon Masjedi
|
||
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Officer(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)
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/s/
Shannon Masjedi
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Shannon Masjedi
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President and Chief Executive Officer
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/s/
Shannon Masjedi
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Shannon Masjedi
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Interim Chief Financial Officer
|
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/s/
Shannon Masjedi
|
|
Shannon Masjedi
|
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President, Chief Executive Officer and
Interim Chief Financial Officer
|
|