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<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><strong>NOTE 1 -NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</strong></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Nature of Business</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company offers retail consumers bottled alkaline water in 500-milliliter, 700-milliliter, 1-liter, 1.5 -liter, 2-liter, 3-liter and 1-gallon sizes, all of which is produced through an electrolysis process that uses specialized electronic cells coated with a variety of rare earth minerals to produce 8.8 pH drinking water without the use of any manmade chemicals. In addition to its bottled alkaline water, the Company also offers retail consumers flavor infused bottled water in the 500-milliliter size in six flavors: Raspberry, Watermelon, Lemon, Lemon Lime, Peach Mango, and Blood Orange. The Company recently introduced and began selling hemp-derived CBD topical and ingestible products under the brand name "A88CBD™". Our hemp-derived CBD products are produced and sold in compliance with the Agriculture Improvement Act of 2018 (also known as the 2018 Farm Bill, Public Law 115-334).</span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Basis of presentation</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">These unaudited financial statements represent the condensed consolidated financial statements of the Company. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's  consolidated financial statements and the notes thereto as set forth in the Company's Form 10-K, filed with the SEC on August 13, 2020, which included all disclosures required by generally accepted accounting principles ("GAAP") In the opinion of management, these unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the Company's financial position on a consolidated basis and the consolidated results of operations, equity and cash flows for the interim periods presented. The results of operations for the three and nine months ended December 31, 2020 and 2019 are not necessarily indicative of expected operating results for the full year. The information presented throughout the document as of and for the three and nine months ended December 31, 2020 and 2019 is unaudited. The condensed consolidated balance sheet at March 31, 2020 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles in the U.S. for complete financial statements.</span></span></p><p style="margin:0pt"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Principles of consolidation</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The consolidated financial statements include the accounts of The Alkaline Water Company Inc. (a Nevada Corporation) and its five wholly owned subsidiaries: A88 Infused Beverage Division Inc. (a Nevada Corporation), A88 International, Inc. (a Nevada Corporation), A88 Infused Products Inc. (a Nevada Corporation), AWC Acquisition Company Inc. (a Nevada corporation) and Alkaline 88, LLC (an Arizona Limited Liability Company).</span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"> </p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span>All significant intercompany balances and transactions have been eliminated. The Alkaline Water Company Inc., A88 Infused Beverage Division, Inc., A88 Infused Products Inc., A88 International, Inc., AWC Acquisition Company Inc., and Alkaline 88, LLC will be collectively referred herein to as the "Company". Any reference herein to "The Alkaline Water Company Inc.", the "Company", "we", "our" or "us" is intended to mean The Alkaline Water Company Inc., including the subsidiaries indicated above, unless otherwise indicated.</span></span></span></span></span></span></span></span></span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"> </p><div><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Use of Estimates</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p></div><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Cash and Cash Equivalents</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company considers all highly liquid instruments with an original maturity of three months or less to be considered cash equivalents. The carrying value of these investments approximates fair value. As of the balance sheet date and periodically throughout the period, the Company has maintained balances in various operating accounts in excess of federally insured limits. The Company had $1,716,944 and $4,561,682 in cash at December 31, 2020 and March 31, 2020, respectively.</span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p></div><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Accounts Receivable and Allowance for Doubtful Accounts</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company generally does not require collateral, and the majority of its trade receivables are unsecured. The carrying amount for accounts receivable approximates fair value.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Accounts receivable consisted of the following as of December 31, 2020 and March 31, 2020:</span></span></p><p style="margin:0pt"> </p><div><div><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span style="text-decoration:underline"><strong>December 31,</strong></span></span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span style="text-decoration:underline"><strong><span><span>2020</span></span></strong></span></span></span></p></td><td style="vertical-align:bottom;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="text-decoration:underline"><strong>March 31,</strong></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="text-decoration:underline"><strong>2020</strong></span></p></td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Trade receivables</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,929,660</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,957,081</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Less: Allowance for doubtful accounts</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>(40,000</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>)</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>(40,000</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>)</span></span></span></span></td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Net accounts receivable</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,889,660</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,917,081</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div></div><p style="text-align:justify"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Accounts receivable are periodically evaluated for collectability based on past credit history with clients. Provisions for losses on accounts receivable are determined on the basis of loss experience, known and inherent risk in the account balance and current economic conditions. The accounts receivable balance is pledged as collateral for the Company's revolving financing as disclosed in Note 3.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Inventory</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Inventory represents raw materials and finished goods valued at the lower of cost or market with cost determined using the weight average method which approximates first-in first-out method, and with market defined as the lower of replacement cost or realizable value. The inventory balance is pledged as collateral for the Company's revolving financing as disclosed in Note 3.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">As of December 31, 2020, and March 31, 2020, inventory consisted of the following:</span></span></p><div><div style="margin-left:5%"><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span style="text-decoration:underline"><strong>December 31, 2020</strong></span></span></span></p></td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span style="text-decoration:underline"><strong>March 31,</strong></span> <span style="text-decoration:underline"><strong>2020</strong></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Raw materials</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>1,619,611</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>1,788,868</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Finished goods</span></span></span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>2,494,043</span></span></span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>1,130,992</span></span></span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Total inventory</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,113,654</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>2,919,860</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div></div><p style="margin:0pt"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Property and Equipment</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company records all property and equipment at cost less accumulated depreciation. Improvements are capitalized while repairs and maintenance costs are expensed as incurred. Depreciation is calculated using the straight-line (half-life convention) method over the estimated useful life of the assets, which the Company has determined to be 3 years.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Stock-Based Compensation</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company accounts for stock-based compensation in accordance with Accounting Standards Codification ("ASC") 718. Stock-based compensation is measured at the grant date, based on the fair value of the award, and is recognized as expense over the requisite service period. The Company estimates the fair value of stock-based payments using the Black-Scholes option-pricing model for common stock options and warrants and the closing price of the Company's common stock for common share issuances.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Revenue recognition</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company recognizes revenue per ASC 606. The Company recognizes revenue when the Company's performance obligations are satisfied. The Company's primary obligation (the distribution and sale of beverage products) is satisfied upon the delivery of products to the Company's customers, which is also when control is transferred. The Company does not accept returns due to the nature of the product. However, the Company will provide credit to our customers for damaged goods. The Company provides credit to its customers which typically require payment within 30 days. As an incentive to pay early the Company also typically provides a 2% discount if the customer pays within 10 days. The Company estimates the amount of the discount that the customer is likely to take and recognizes it as variable consideration. The amounts are not considered material. After evaluating the revenue disclosure requirements, the Company does not believe that any revenues are required to be disaggregated.</span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Revenue consists of the gross sales price, less variable consideration, consisting of estimated allowances for which provisions are made at the time of sale, and less certain other discounts, allowances, and rebates that are accounted for as a reduction from gross revenue. Shipping and handling charges that are billed to customers are included as a component of revenue. Costs incurred by the Company for shipping and handling charges are included in selling expenses and amounted to $1,837,964 and $1,175,274 for the three months ended December 31, 2020 and 2019, respectively and $5,315,518 and $4,103,437 for the nine months ended December 31, 2020 and 2019, respectively.</span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Concentration Risks </span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">We have 2 major customers that together account for 35% (18% and 17%, respectively) of accounts receivable at December 31, 2020, 2 customer that accounts for 40% (25% and 15%, respectively) of total revenues for the three months ended December 31, 2020 and 2 customers that accounts for 40% (23% and 17%, respectively) of the total revenues earned for the nine months ended December 31, 2020. The Company has 2 vendors that accounts for 48% (24% and 24% respectively) of purchases for the three months ended December 31, 2020 and 3 vendors that accounted for 52% (23%, 19% and 11% respectively) of purchases for the nine months ended December 31, 2020.</span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">We had 3 major customers that together account for 51% (22%, 16% and 13%, respectively) of accounts receivable at December 31, 2019. The Company had 2 customers that together accounted for 40% (26% and 14%, respectively) of the total revenues earned for the three months ended December 31, 2019 and 2 customers that together accounted for 40% (24% and 16% respectively) of the total revenues earned for the nine months ended December 31, 2019. The Company has 2 vendors that accounts for 42% (23% and 19% respectively) of purchases for the three months ended December 31, 2019 and 3 vendors that accounted for 52% (21%, 21% and 10% respectively) of purchases for the nine months ended December 31, 2019.</span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Income Taxes</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company uses an estimated annual effective tax rate method in computing its interim tax provision. This effective tax rate is based on forecasted annual pre-tax income (loss), permanent tax differences and statutory tax rates. Deferred income taxes are recognized for differences between the basis of assets and liabilities for financial statement and income tax purposes. The differences relate principally to net operating loss carryforwards. Deferred tax assets and liabilities represent the future tax consequence for those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Basic and Diluted Loss Per Share</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Basic and diluted earnings or loss per share ("EPS") amounts in the consolidated financial statements are computed in accordance with ASC 260- 10 "<i>Earnings per Share</i>", which establishes the requirements for presenting EPS. Basic EPS is based on the weighted average number of common shares outstanding. Diluted EPS is based on the weighted average number of common shares outstanding and dilutive common stock equivalents. Basic EPS is computed by dividing net income or loss available to common stockholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period. Potentially dilutive securities were excluded from the calculation of diluted loss per share because their effect would be anti-dilutive.</span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company had 1,348,566 and 250,506 shares relating to options and 2,453,243 and -0- shares relating to warrants at December 31, 2020 and 2019, respectively that were not included in the diluted earnings per share calculation because they were antidilutive.</span></span></p> <div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p></div><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Business Segments</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company operates on one segment in one geographic location - the United States of America and therefore, segment information is not presented.</span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Fair Value of Financial Instruments</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The carrying amounts of the Company's financial instruments including accounts payable, accrued expenses, and notes payable approximate fair value due to the relative short period for maturity of these instruments.</span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company does not use derivative financial instruments to hedge exposures to cash-flow, market or foreign-currency risks.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Authoritative guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability, developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the company's assumptions of what market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on reliability of the inputs as follows:</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-left:34.35pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Level 1: Observable inputs such as quoted prices in active markets;</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-left:34.35pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-left:34.35pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">As of December 31, 2020, and 2019, the Company did not have any financial instruments that are measured on a recurring basis as Level 1, 2 or 3.</span></span></p><p style="margin:0pt"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Recent Accounting Pronouncements</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><i>Standards Required to be Adopted in Future Years.</i></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">In June 2016, the FASB issued ASU 2016-13, <i>Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.</i> ASU 2016-13 amends the guidance on the impairment of financial instruments. This update adds an impairment model (known as the current expected credit losses model) that is based on expected losses rather than incurred losses. Under the new guidance, an entity recognizes, as an allowance, its estimate of expected credit losses. In November 2019,the FASB issued ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842). ASU 2019-10 changes the effective date of the credit loss standard (ASU 2016-13) to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years for smaller reporting companies Further, the ASU clarifies that operating lease receivables are not within the scope of ASC 326-20 and should instead be accounted for under the new leasing standard, ASC 842. The Company does not believe that the impact of adopting this standard will have a material effect on its financial statements.</span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company has evaluated other recent accounting pronouncements through December 31, 2020 and believes that none of them will have a material effect on our consolidated financial statements.</span></span></p>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Nature of Business</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company offers retail consumers bottled alkaline water in 500-milliliter, 700-milliliter, 1-liter, 1.5 -liter, 2-liter, 3-liter and 1-gallon sizes, all of which is produced through an electrolysis process that uses specialized electronic cells coated with a variety of rare earth minerals to produce 8.8 pH drinking water without the use of any manmade chemicals. In addition to its bottled alkaline water, the Company also offers retail consumers flavor infused bottled water in the 500-milliliter size in six flavors: Raspberry, Watermelon, Lemon, Lemon Lime, Peach Mango, and Blood Orange. The Company recently introduced and began selling hemp-derived CBD topical and ingestible products under the brand name "A88CBD™". Our hemp-derived CBD products are produced and sold in compliance with the Agriculture Improvement Act of 2018 (also known as the 2018 Farm Bill, Public Law 115-334).</span></span></p>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Basis of presentation</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">These unaudited financial statements represent the condensed consolidated financial statements of the Company. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's  consolidated financial statements and the notes thereto as set forth in the Company's Form 10-K, filed with the SEC on August 13, 2020, which included all disclosures required by generally accepted accounting principles ("GAAP") In the opinion of management, these unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the Company's financial position on a consolidated basis and the consolidated results of operations, equity and cash flows for the interim periods presented. The results of operations for the three and nine months ended December 31, 2020 and 2019 are not necessarily indicative of expected operating results for the full year. The information presented throughout the document as of and for the three and nine months ended December 31, 2020 and 2019 is unaudited. The condensed consolidated balance sheet at March 31, 2020 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles in the U.S. for complete financial statements.</span></span></p><p style="margin:0pt"> </p>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Principles of consolidation</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The consolidated financial statements include the accounts of The Alkaline Water Company Inc. (a Nevada Corporation) and its five wholly owned subsidiaries: A88 Infused Beverage Division Inc. (a Nevada Corporation), A88 International, Inc. (a Nevada Corporation), A88 Infused Products Inc. (a Nevada Corporation), AWC Acquisition Company Inc. (a Nevada corporation) and Alkaline 88, LLC (an Arizona Limited Liability Company).</span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"> </p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span>All significant intercompany balances and transactions have been eliminated. The Alkaline Water Company Inc., A88 Infused Beverage Division, Inc., A88 Infused Products Inc., A88 International, Inc., AWC Acquisition Company Inc., and Alkaline 88, LLC will be collectively referred herein to as the "Company". Any reference herein to "The Alkaline Water Company Inc.", the "Company", "we", "our" or "us" is intended to mean The Alkaline Water Company Inc., including the subsidiaries indicated above, unless otherwise indicated.</span></span></span></span></span></span></span></span></span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"> </p>
<div><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Use of Estimates</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p></div>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Cash and Cash Equivalents</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company considers all highly liquid instruments with an original maturity of three months or less to be considered cash equivalents. The carrying value of these investments approximates fair value. As of the balance sheet date and periodically throughout the period, the Company has maintained balances in various operating accounts in excess of federally insured limits. The Company had $1,716,944 and $4,561,682 in cash at December 31, 2020 and March 31, 2020, respectively.</span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p></div>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Accounts Receivable and Allowance for Doubtful Accounts</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company generally does not require collateral, and the majority of its trade receivables are unsecured. The carrying amount for accounts receivable approximates fair value.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Accounts receivable consisted of the following as of December 31, 2020 and March 31, 2020:</span></span></p><p style="margin:0pt"> </p><div><div><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span style="text-decoration:underline"><strong>December 31,</strong></span></span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span style="text-decoration:underline"><strong><span><span>2020</span></span></strong></span></span></span></p></td><td style="vertical-align:bottom;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="text-decoration:underline"><strong>March 31,</strong></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="text-decoration:underline"><strong>2020</strong></span></p></td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Trade receivables</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,929,660</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,957,081</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Less: Allowance for doubtful accounts</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>(40,000</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>)</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>(40,000</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>)</span></span></span></span></td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Net accounts receivable</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,889,660</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,917,081</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div></div><p style="text-align:justify"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Accounts receivable are periodically evaluated for collectability based on past credit history with clients. Provisions for losses on accounts receivable are determined on the basis of loss experience, known and inherent risk in the account balance and current economic conditions. The accounts receivable balance is pledged as collateral for the Company's revolving financing as disclosed in Note 3.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p>
<div><div><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span style="text-decoration:underline"><strong>December 31,</strong></span></span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span style="text-decoration:underline"><strong><span><span>2020</span></span></strong></span></span></span></p></td><td style="vertical-align:bottom;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="text-decoration:underline"><strong>March 31,</strong></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="text-decoration:underline"><strong>2020</strong></span></p></td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Trade receivables</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,929,660</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,957,081</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Less: Allowance for doubtful accounts</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>(40,000</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>)</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;border-bottom:2.25pt double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>(40,000</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>)</span></span></span></span></td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Net accounts receivable</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,889,660</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,917,081</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div></div>
4929660
4957081
40000
40000
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Inventory</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Inventory represents raw materials and finished goods valued at the lower of cost or market with cost determined using the weight average method which approximates first-in first-out method, and with market defined as the lower of replacement cost or realizable value. The inventory balance is pledged as collateral for the Company's revolving financing as disclosed in Note 3.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">As of December 31, 2020, and March 31, 2020, inventory consisted of the following:</span></span></p><div><div style="margin-left:5%"><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span style="text-decoration:underline"><strong>December 31, 2020</strong></span></span></span></p></td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span style="text-decoration:underline"><strong>March 31,</strong></span> <span style="text-decoration:underline"><strong>2020</strong></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Raw materials</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>1,619,611</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>1,788,868</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Finished goods</span></span></span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>2,494,043</span></span></span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>1,130,992</span></span></span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Total inventory</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,113,654</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>2,919,860</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div></div>
<div><div style="margin-left:5%"><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span style="text-decoration:underline"><strong>December 31, 2020</strong></span></span></span></p></td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span style="text-decoration:underline"><strong>March 31,</strong></span> <span style="text-decoration:underline"><strong>2020</strong></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Raw materials</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>1,619,611</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>1,788,868</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Finished goods</span></span></span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>2,494,043</span></span></span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>1,130,992</span></span></span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Total inventory</span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>4,113,654</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>$</span></span></span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>2,919,860</span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div></div>
1619611
1788868
2494043
1130992
<p style="margin:0pt"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Property and Equipment</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company records all property and equipment at cost less accumulated depreciation. Improvements are capitalized while repairs and maintenance costs are expensed as incurred. Depreciation is calculated using the straight-line (half-life convention) method over the estimated useful life of the assets, which the Company has determined to be 3 years.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Stock-Based Compensation</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company accounts for stock-based compensation in accordance with Accounting Standards Codification ("ASC") 718. Stock-based compensation is measured at the grant date, based on the fair value of the award, and is recognized as expense over the requisite service period. The Company estimates the fair value of stock-based payments using the Black-Scholes option-pricing model for common stock options and warrants and the closing price of the Company's common stock for common share issuances.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Revenue recognition</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company recognizes revenue per ASC 606. The Company recognizes revenue when the Company's performance obligations are satisfied. The Company's primary obligation (the distribution and sale of beverage products) is satisfied upon the delivery of products to the Company's customers, which is also when control is transferred. The Company does not accept returns due to the nature of the product. However, the Company will provide credit to our customers for damaged goods. The Company provides credit to its customers which typically require payment within 30 days. As an incentive to pay early the Company also typically provides a 2% discount if the customer pays within 10 days. The Company estimates the amount of the discount that the customer is likely to take and recognizes it as variable consideration. The amounts are not considered material. After evaluating the revenue disclosure requirements, the Company does not believe that any revenues are required to be disaggregated.</span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Revenue consists of the gross sales price, less variable consideration, consisting of estimated allowances for which provisions are made at the time of sale, and less certain other discounts, allowances, and rebates that are accounted for as a reduction from gross revenue. Shipping and handling charges that are billed to customers are included as a component of revenue. Costs incurred by the Company for shipping and handling charges are included in selling expenses and amounted to $1,837,964 and $1,175,274 for the three months ended December 31, 2020 and 2019, respectively and $5,315,518 and $4,103,437 for the nine months ended December 31, 2020 and 2019, respectively.</span></span></p>
1837964
1175274
5315518
4103437
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Concentration Risks </span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">We have 2 major customers that together account for 35% (18% and 17%, respectively) of accounts receivable at December 31, 2020, 2 customer that accounts for 40% (25% and 15%, respectively) of total revenues for the three months ended December 31, 2020 and 2 customers that accounts for 40% (23% and 17%, respectively) of the total revenues earned for the nine months ended December 31, 2020. The Company has 2 vendors that accounts for 48% (24% and 24% respectively) of purchases for the three months ended December 31, 2020 and 3 vendors that accounted for 52% (23%, 19% and 11% respectively) of purchases for the nine months ended December 31, 2020.</span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">We had 3 major customers that together account for 51% (22%, 16% and 13%, respectively) of accounts receivable at December 31, 2019. The Company had 2 customers that together accounted for 40% (26% and 14%, respectively) of the total revenues earned for the three months ended December 31, 2019 and 2 customers that together accounted for 40% (24% and 16% respectively) of the total revenues earned for the nine months ended December 31, 2019. The Company has 2 vendors that accounts for 42% (23% and 19% respectively) of purchases for the three months ended December 31, 2019 and 3 vendors that accounted for 52% (21%, 21% and 10% respectively) of purchases for the nine months ended December 31, 2019.</span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"> </p>
2
2
2
3
2
0.35
0.18
0.17
0.40
0.25
0.15
0.40
0.23
0.17
0.48
0.24
0.24
0.52
0.23
0.19
0.11
0.51
0.22
0.16
0.13
0.40
0.26
0.14
0.40
0.24
0.16
0.42
0.23
0.19
0.52
0.21
0.21
0.10
2
3
2
3
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Income Taxes</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company uses an estimated annual effective tax rate method in computing its interim tax provision. This effective tax rate is based on forecasted annual pre-tax income (loss), permanent tax differences and statutory tax rates. Deferred income taxes are recognized for differences between the basis of assets and liabilities for financial statement and income tax purposes. The differences relate principally to net operating loss carryforwards. Deferred tax assets and liabilities represent the future tax consequence for those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Basic and Diluted Loss Per Share</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Basic and diluted earnings or loss per share ("EPS") amounts in the consolidated financial statements are computed in accordance with ASC 260- 10 "<i>Earnings per Share</i>", which establishes the requirements for presenting EPS. Basic EPS is based on the weighted average number of common shares outstanding. Diluted EPS is based on the weighted average number of common shares outstanding and dilutive common stock equivalents. Basic EPS is computed by dividing net income or loss available to common stockholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period. Potentially dilutive securities were excluded from the calculation of diluted loss per share because their effect would be anti-dilutive.</span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company had 1,348,566 and 250,506 shares relating to options and 2,453,243 and -0- shares relating to warrants at December 31, 2020 and 2019, respectively that were not included in the diluted earnings per share calculation because they were antidilutive.</span></span></p><div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p></div>
1348566
250506
2453243
0
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Business Segments</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company operates on one segment in one geographic location - the United States of America and therefore, segment information is not presented.</span></span></p>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Fair Value of Financial Instruments</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The carrying amounts of the Company's financial instruments including accounts payable, accrued expenses, and notes payable approximate fair value due to the relative short period for maturity of these instruments.</span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>The Company does not use derivative financial instruments to hedge exposures to cash-flow, market or foreign-currency risks.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Authoritative guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability, developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the company's assumptions of what market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on reliability of the inputs as follows:</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-left:34.35pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Level 1: Observable inputs such as quoted prices in active markets;</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-left:34.35pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-left:34.35pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span>Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">As of December 31, 2020, and 2019, the Company did not have any financial instruments that are measured on a recurring basis as Level 1, 2 or 3.</span></span></p><p style="margin:0pt"> </p>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><span style="text-decoration:underline">Recent Accounting Pronouncements</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><span><span><i>Standards Required to be Adopted in Future Years.</i></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">In June 2016, the FASB issued ASU 2016-13, <i>Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.</i> ASU 2016-13 amends the guidance on the impairment of financial instruments. This update adds an impairment model (known as the current expected credit losses model) that is based on expected losses rather than incurred losses. Under the new guidance, an entity recognizes, as an allowance, its estimate of expected credit losses. In November 2019,the FASB issued ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842). ASU 2019-10 changes the effective date of the credit loss standard (ASU 2016-13) to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years for smaller reporting companies Further, the ASU clarifies that operating lease receivables are not within the scope of ASC 326-20 and should instead be accounted for under the new leasing standard, ASC 842. The Company does not believe that the impact of adopting this standard will have a material effect on its financial statements.</span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">The Company has evaluated other recent accounting pronouncements through December 31, 2020 and believes that none of them will have a material effect on our consolidated financial statements.</span></span></p>
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><strong>NOTE 2 - PROPERTY AND EQUIPMENT</strong></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Property and equipment consisted of the following at:</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><div><div style="margin-left:0%"><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"> </p></td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">December 31,<br/>2020<br/>(unaudited)</p></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">March 31,<br/>2020</p></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Machinery and equipment</span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">$</span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">4,402,275</span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">$</span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">4,249,398</span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Office equipment</span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">32,992</span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">32,992</span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Less: accumulated depreciation</span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">(3,554,088</span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">)</span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">(2,859,809</span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">)</span></span></td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">Property and equipment, net</p></td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">$</span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">881,179</span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">$</span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">1,422,581</span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr></tbody></table></div></div><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Depreciation expense for the three months ended December 31, 2020 and December 31, 2019 was $281,962 and $254,220, respectively.</p><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Depreciation expense for the nine months ended December 31, 2020 and December 31, 2020 was $694,279 and $727,917, respectively.</p>
<div><div style="margin-left:0%"><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"> </p></td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">December 31,<br/>2020<br/>(unaudited)</p></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">March 31,<br/>2020</p></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Machinery and equipment</span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">$</span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">4,402,275</span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">$</span></span></td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">4,249,398</span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Office equipment</span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">32,992</span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">32,992</span></span></td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Less: accumulated depreciation</span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">(3,554,088</span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">)</span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;border-bottom:0.75pt solid rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">(2,859,809</span></span></td><td style="vertical-align:bottom;border-bottom:0.75pt solid transparent;text-align:left;width:2%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">)</span></span></td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">Property and equipment, net</p></td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">$</span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">881,179</span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);width:1%;text-align:left;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">$</span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">1,422,581</span></span></td><td style="vertical-align:bottom;border-bottom:2.25pt double transparent;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr></tbody></table></div></div>
4402275
4249398
32992
32992
3554088
2859809
881179
1422581
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><strong>NOTE 3 - REVOLVING FINANCING</strong></span></span></span></span></span></span></p><div><div><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">On February 1, 2017, the Company entered into a Credit and Security Agreement (the "Credit Agreement") with CNH Finance Fund I, L.P. (fka SCM Specialty Finance Opportunities Fund, L.P.) (the "Lender") which has been amended from time to time the last of which was March 2020.</span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>The Credit Agreement provides the Company with a revolving credit facility (the "Revolving Facility"), the proceeds of which are to be used to repay existing indebtedness of the Company, transaction fees incurred in connection with the Credit Agreement and for working capital needs of the Company.</span></span></span></span></p></div></div><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Under the terms of the Credit Agreement, the Lender has agreed to make cash advances to the Company in an aggregate principal at any one time outstanding not to exceed the lesser of (i) $7 million (the "Revolving Loan Commitment Amount") and (ii) the Borrowing Base (defined to mean, as of any date of determination, 85% of net eligible billed receivables plus 65% of eligible unbilled receivables, minus certain reserves, and is subject to certain customer specific requirements).</span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>The Credit Agreement expires on July 1, 2022, unless earlier terminated by the parties in accordance with the terms of the Credit Agreement.</span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>The principal amount of the Revolving Facility outstanding bears interest at a rate per annum equal to (i) a fluctuating interest rate per annum equal at all times to the rate of interest announced, from time to time, within Wells Fargo Bank at its principal office in San Francisco as its "prime rate," plus (ii) 3.25%, payable monthly in arrears. The interest rate as of December 31, 2020 was 6.5%.</span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>To secure the payment and performance of the obligations under the Credit Agreement, the Company granted to the Lender a continuing security interest in all of the Company's assets and agreed to a lockbox account arrangement in respect of certain eligible receivables.</span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>In connection with the Credit Agreement, the Company paid to the Lender a $30,000 facility fee. The Company agreed to pay the Lender monthly an unused line fee in amount equal to 0.083% per month of the difference derived by subtracting (i) the average daily outstanding balance under the Revolving Facility during the preceding month, from (ii) the Revolving Loan Commitment Amount. The unused line fee will be payable monthly in arrears. The Company also agreed to pay the Lender as additional interest a monthly collateral management fee equal to 0.35% per month calculated on the basis of the average daily balance under the Revolving Facility outstanding during the preceding month. The collateral management fee will be payable monthly in arrears. Upon a termination of the Revolving Facility, the Company agreed to pay the Lender a termination fee in an amount equal to 1% of the Revolving Loan Commitment Amount if the termination occurs before July 1, 2022. The Company must also pay certain fees in the event that receivables are not properly deposited in the appropriate lockbox account.</span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>The interest rate will be increased by 5% in the event of a default under the Credit Agreement. Events of default under the Credit Agreement, some of which are subject to certain cure periods, include a failure to pay obligations when due, the making of a material misrepresentation to the Lender, the rendering of certain judgments or decrees against the Company and the commencement of a proceeding for the appointment of a receiver, trustee, liquidator or conservator or filing of a petition seeking reorganization or liquidation or similar relief.</span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>The Credit Agreement contains customary representations and warranties and various affirmative and negative covenants including the right of first refusal to provide financing for the Company and the financial and loan covenants, such as the loan turnover rate, minimum EBITDA, fixed charge coverage ratio and minimum liquidity requirements. The Company was in compliance with those covenants as of December 31, 2020.</span></span></span></span></span></span></p><div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">In March 2020, the Lender agreed to provide the Company a $400,000 Temporary Over Advance ("TOA") under the Credit Facility Agreement. The TOA is to be repaid as follows: (i) the Company shall make five (5) weekly principal payments on the TOA 2 each in the amount of $20,000 commencing on May 18, 2020 and on the first Business Day of each calendar week thereafter through and including June 15, 2020, (ii) the Company shall make ten (10) weekly principal payments on the TOA, each in the amount of $30,000, commencing on June 22, 2020 and on the first Business Day of each calendar week thereafter through and including August 24, 2020 and (iii) repay the remaining principal balance on the TOA, if any, in full on or prior to August 24, 2020. As of December 31, 2020, the balance of the TOA was zero.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">In March 2020, David Guarino, the Company's Chief Financial Officer, entered into a Guarantee Agreement (the "Guarantee") with the Lender in order for the Lender to agree to provide the Company the $400,000 TOA under the Credit Agreement. Under the Guarantee, Mr. Guarino personally, absolutely, and unconditionally, jointly and severally, guaranteed the prompt, complete and full payment of the Company's obligations to repay the TOA only, under the Credit Agreement, with the Lender.</p></div>
Under the terms of the Credit Agreement, the Lender has agreed to make cash advances to the Company in an aggregate principal at any one time outstanding not to exceed the lesser of (i) $7 million (the "Revolving Loan Commitment Amount") and (ii) the Borrowing Base (defined to mean, as of any date of determination, 85% of net eligible billed receivables plus 65% of eligible unbilled receivables, minus certain reserves, and is subject to certain customer specific requirements).
The principal amount of the Revolving Facility outstanding bears interest at a rate per annum equal to (i) a fluctuating interest rate per annum equal at all times to the rate of interest announced, from time to time, within Wells Fargo Bank at its principal office in San Francisco as its "prime rate," plus (ii) 3.25%, payable monthly in arrears. The interest rate as of December 31, 2020 was 6.5%.
30000
0.00083
0.0035
0.01
0.05
400000
0
400000
20000
30000
<div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><strong>NOTE 4 - PAYCHECK PROTECTION PROGRAM LOAN</strong></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify">On April 29, 2020, Alkaline 88, LLC (the "Borrower"), a wholly owned subsidiary of the Company, signed a promissory note with MidFirst Bank (the "Lender") in the amount of $325,800, pursuant to the Paycheck Protection Program (the "PPP") under Division A, Title I of the CARES Act, which was enacted March 27, 2020.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify">The promissory note issued by Borrower, matures on April 29, 2022 and bears interest at a rate of 1% per annum.  Borrower shall pay principal plus interest accrued under the promissory note in 18 equal monthly installments beginning on October 29, 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 incurred before February 15, 2020. 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. The Company will apply for loan forgiveness with the Lender.</p></div>
325800
2022-04-29
0.01
Borrower shall pay principal plus interest accrued under the promissory note in 18 equal monthly installments beginning on October 29, 2020.
<div><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><strong>NOTE 5 - STOCKHOLDER EQUITY</strong></p><p style="margin:0pt"> </p><p style="text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000"><span><span><span><span><span><span><span style="text-decoration:underline">Preferred Shares</span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000"><span><span><span><span>On October 7, 2013, the Company amended its articles of incorporation to create<span><span> 100,000,000 </span></span>shares of preferred stock by filing a Certificate of Amendment to Articles of Incorporation with the Secretary of State of Nevada. The preferred stock may be divided into and issued in series, with such designations, rights, qualifications, preferences, limitations and terms as fixed and determined by our board of directors.</span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000"><span><span><span><span><span><span><span style="text-decoration:underline">Grant of Series D Convertible Preferred Stock</span></span></span></span></span></span></span></span></span></span></p><div><div><p style="text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000"><span><span>On May 3, 2017, the Company designated 3,000,000 shares of the authorized and unissued preferred stock of our company as "Series D Preferred Stock" by filing a Certificate of Designation with the Secretary of State of the State of Nevada. On November 2, 2017, The Company increased the number of authorized shares of Series D Preferred Stock in our company to 5,000,000 shares by filing an Amendment to the foregoing Certificate of Designation with the Secretary of State of the State of Nevada. Each share of the Series D Preferred Stock will be convertible, without the payment of any additional consideration by the holder and at the option of the holder, into one fully paid and nonassessable share of our common stock at any time after (i) the Company achieved the consolidated revenue of our company and all of its subsidiaries equal to or greater than $40,000,000 in any 12 month period, ending on the last day of any quarterly period of our fiscal year; or (ii) a Negotiated Trigger Event, defined as an event upon which the Series D Preferred Stock will be convertible as may be agreed by our company and the holder in writing from time to time.</span></span></span></span></span></p><p style="text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000"><span><span>Effective as of April 1, 2020, the Company issued an aggregate of 3,400,000 shares of our common stock upon conversion of an aggregate of 3,400,000 shares of our Series D Preferred Stock without the payment of any additional consideration. Of the 3,400,000 shares that the Company issued, 1,500,000 shares were issued to Richard A. Wright, our president, chief executive officer and director, 1,000,000 shares were issued to David A. Guarino, our treasurer, secretary, chief financial officer and director and 900,000 shares were issued to three other individuals.</span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000"><span style="text-decoration:underline">Common Shares</span></span></span></span></p><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><strong>Private Placement</strong></p><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000">On April 17, 2020, the Company completed a private placement of 9,750,000 units of our securities at a price of $0.40 per unit for gross proceeds of $3,900,000, of which $1,000,000 was received on March 18,2020 and thus on March 31, 2020, the Company had $1 million as stock payable. Each unit consisted of one share of our common stock and one share purchase warrant, with each share purchase warrant entitling the holder to acquire one additional share of our common stock at a price of $0.50 per share for a period of three years.  Of the 9,750,000 units the Company issued: (i) 1,250,000 units were issued pursuant to the exemption from registration under the Securities Act of 1933, as amended provided by Section 4(a)(2) and/or Rule 506 of Regulation D promulgated under the Securities Act of 1933, as amended to one investor who is an "accredited investor" within the respective meanings ascribed to that term in Regulation D promulgated under the Securities Act of 1933, as amended; and (ii) 8,500,000 units were issued to 5 non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(a)(2) of the Securities Act of 1933, as amended. In connection with this private placement, the Company agreed with each subscriber who purchased these units to prepare and file a registration statement with respect to (i) the shares of our common stock comprising these units and (ii) the shares of our common stock issuable upon exercise of the share purchase warrants comprising these units with the Securities and Exchange Commission within 90 days following the closing of the private placement and agreed to use commercially reasonable efforts to have the registration statement declared effective by the Securities and Exchange Commission as soon as possible.  The Company filed the foregoing registration statement on Form S-3 with the SEC on May 27, 2020, and the registration statement was declared effective by the SEC on June 8, 2020.</span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000">On May 11, 2020, the Company completed a private placement of 4,444,440 subscription receipts at a price of $0.45 per subscription receipt for total gross proceeds of $1,999,998, which is being held in escrow until the subscription receipts are converted into common shares. To convert these subscription receipts to common shares in the Company and thereby satisfy the escrow condition, the Company needs the approval of its shareholders </span><span style="color:#000000">by July 15, 2020 or the funds held in escrow will be refunded to the subscribers. As of June 30, 2020, the Company has recognized the $1,999,998 as restricted cash and recognized the same amount as stock payable on the financial statements.</span><span style="color:#000000"> On July 14, 2020 after receiving the Shareholder Approval, the Company issued 4,444,440 units pursuant to the foregoing private placement completed on May 11, 2020. Accordingly, gross proceeds of $1,999,998, previously held in escrow, have been released to our company. Each unit consists of one share of our common stock and one transferable share purchase warrant, for no additional consideration. Each warrant will entitle the holder thereof to acquire one share of our common stock until May 11, 2023 at a price of $0.55 per share. In the event that our common stock has a closing price on the TSX Venture Exchange (or such other exchange on which our common stock may be traded at such time) of $1.75 or greater per share for a period of 20 consecutive trading days at any time from the closing date of the private placement, the Company may accelerate the expiry date of the warrants by giving notice to the holders thereof (by disseminating a news release advising of the acceleration of the expiry date of the warrants) and, in such case, the warrants will expire on the thirtieth day after the date of such notice. The proceeds of the private placement are expected to be used to fund our company's general working capital and expansion of production capacity. Of the 4,444,440 units the Company issued: (i) 444,443 units were issued pursuant to the exemption from registration under the Securities Act of 1933, as amended provided by Section 4(a)(2) and/or Rule 506 of Regulation D promulgated under the Securities Act of 1933, as amended to three investors, each of who is an "accredited investor" within the meaning ascribed to that term in Regulation D promulgated under the Securities Act of 1933, as amended; and (ii) 3,999,997 units were issued to three non-U.S. persons (as that term is defined in Regulation S of the Securities Act of 1933, as amended) in an offshore transaction relying on Regulation S and/or Section 4(a)(2) of the Securities Act of 1933, as amended. In connection with the private placement, the Company agreed with each subscriber who purchased these subscription receipts to prepare and file a registration statement with respect to (i) the shares of our common stock comprising these subscription receipts and (ii) the shares of our common stock issuable upon exercise of the share purchase warrants comprising these subscription receipts with the Securities and Exchange Commission within 30 days following the satisfaction of the Release Condition and agreed to use commercially reasonable efforts to have the registration statement declared effective by the Securities and Exchange Commission as soon as possible.  The Company filed the foregoing registration statement on Form S-3 with the SEC on May 27, 2020, and the registration statement was declared effective by the SEC on June 8, 2020.</span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><strong>Share Issuance</strong></p><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000">On April 30, 2020, the Company issued an aggregate of 247,000 shares of our common stock to non-employees in consideration for services rendered to our company.</span></span></span></p><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000">Effective as of May 22, 2020, the Company issued 170,000 shares of our common stock to non-employees in consideration for services to be rendered to our company.</span></span></span></p><p style="margin:0pt;text-align:justify"> </p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt">Effective as of August 18, 2020, the Company issued 90,116 shares of our common stock to non-employees in consideration for services to be rendered to our company. </span></span><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="line-height:107%">The total fair value of the shares is $155,000 based on the $1.72 per share closing price of the Company’s common stock on the NASDAQ stock exchange on August 18, 2020. </span></span></span><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt">These shares were issued pursuant to an agreement dated July 30, 2020, whereby an entity was engaged to provide investor relations management services through its online platform for the Company for an initial term beginning on August 3, 2020 and ending on November 3, 2020. The Company agreed to pay a one-time annual platform access fee in the amount of $40,000 plus pay for an additional deliverables during the term in the amount of $115,000 for a total of $155,000, which amount was paid in the form of 90,116 shares of common stock of the Company. </span></span></p><p style="margin:0pt;text-align:justify"> </p><div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Effective as of July 17, 2020, August 28, 2020, September 23,2020, October 16, 2020, November 18, 2020 and December 16, 2020 the Company issued 18,779 shares, 53,256 shares, 28,985 shares, 24,844 shares, 35,398 shares and 37,735 shares respectively of our common stock to non-employees in consideration for services to be rendered to our company. The total fair value of the shares is $40,000, $91,600, $40,000, $40,000, $40,000 and $40,000 respectively based upon the $2.13, $1.72, $1.38, $1.61, $1.13 and $1.06 per share closing price of the Company's common stock on the NASDAQ stock exchange on July 17, 2020, August 28, 2020, September 23, 2020, October 16, 2020, November 19, 2020 and December 18, 2020. These shares were issues pursuant to a consulting agreement dated June 15, 2020 whereby the Company engaged an entity to perform consulting services for the Company for a period of one year. The Company agreed to pay a retainer in the amount of $40,000 per month, for a total of $480,000 to be paid in the form of the common stock of the Company, which shares are to be issued monthly.</p></div><p style="margin:0pt;text-align:justify"> </p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><strong>Restricted Awards</strong></p><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt"><span style="color:#000000">On April 30, 2020, the Company granted awards of an aggregate of 1,065,000 shares of our common stock as "restricted awards" under our 2020 Equity Incentive Plan to certain directors, officers, employees and consultants. Of these shares, 645,000 vest on the one-year anniversary of the grant date, 200,000 vest as to 50% on the one-year anniversary of the grant date and 50% vest on the second year anniversary of the grant date, 165,000 vest as to one-third on each anniversary of the grant date and 55,000 vest immediately. On April 30, 2020, the Company issued the immediately vested awards, 35,000 to a non-employee, and 20,000 to an employee.  The grantees have no rights or privileges as stockholders of our company with respect to the unvested shares including, without limitation, the right to vote such shares and receive all dividends or other distributions paid with respect to such shares. Of these restricted awards granted on April 30, 2020, an award of 200,000 shares of our common stock went to Richard A. Wright, our president, chief executive officer and director, and an award of 100,000 shares of our common stock went to David A. Guarino, our chief financial officer, secretary, treasurer and director. The Company granted these shares as "restricted awards" under our 2020 Equity Incentive Plan. These shares vest on the one-year anniversary of the grant date. The grantees have no rights or privileges as a stockholder of our company with respect to the unvested shares including, without limitation, the right to vote such shares and receive all dividends or other distributions paid with respect to such shares. The total fair value of the 1,065,000 shares of the Company’s common stock granted as “restricted awards” is $1,065,000, based upon the $1.00 per share closing price of the Company’s common stock on the NASDAQ stock exchange on April 29, 2020.</span></span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"> </p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"><span style="font-family:Times New Roman,Times,serif"><span style="font-size:10pt">On August 27, 2020, the Company granted an award of 20,000 shares of our common stock as "restricted awards" under our 2020 Equity Incentive Plan to new employee.  These shares vest one-third on each anniversary date over three years. The grantee has no rights or privileges as stockholders of our company with respect to the unvested shares including, without limitation, the right to vote such shares and receive all dividends or other distributions paid with respect to such shares.  The total fair value of  the 20,000 shares of the Company's common stock granted as "restricted awards" is $30,400 based upon the $1.52 per share closing price of the Company's common stock on the NASDAQ stock exchange on August 27, 2020. </span></span></p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt;text-align:justify"> </p><div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">The Company's total stock compensation expense on account of the 1,065,000 shares of its common stock granted on April 30, 2020 and the 20,000 shares of its common stock granted on August 27, 2020 as "restricted awards" for the three-month period ended December 31, 2020 was $210,172 and for the nine-month period ended December 31, 2020 was $576,600. An additional expense will be recognized of $ 198,367 will be recognized in the year ended March 31, 2021 for a total of $773,967 expense in the fiscal year ended March 31, 2021. Additional expense will be recognized in the next 3 fiscal years of $202,217, $56,800 and $7,417, respectively.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">During October 2020, the Company issued 50,000 shares of our common stock to an employee upon his exercise of vested restricted awards under our 2020 Equity Incentive Plan.</p></div></div></div></div>
40000000
3400000
9750000
1250000
8500000
4444440
444443
3999997
0.40
0.45
3900000
1000000
1999998
Each unit consisted of one share of our common stock and one share purchase warrant, with each share purchase warrant entitling the holder to acquire one additional share of our common stock at a price of $0.50 per share for a period of three years.
Each unit consists of one share of our common stock and one transferable share purchase warrant, for no additional consideration. Each warrant will entitle the holder thereof to acquire one share of our common stock until May 11, 2023 at a price of $0.55 per share. In the event that our common stock has a closing price on the TSX Venture Exchange (or such other exchange on which our common stock may be traded at such time) of $1.75 or greater per share for a period of 20 consecutive trading days at any time from the closing date of the private placement
1.72
2.13
1.72
1.38
1.61
1.13
1.06
40000
115000
40000
480000
1065000
645000
200000
165000
55000
35000
20000
200000
100000
20000
20000
50000
1065000
30400
1.00
1.52
198367
226730
773967
1307282
202217
331057
56800
104970
7417
16557
<div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><strong>NOTE 6 - OPTIONS AND WARRANTS</strong></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="text-decoration:underline">Options</span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><strong>Issuance of Options</strong></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">On April 3, 2020, the Company granted an aggregate of 2,737,000 stock options to certain directors, officers, consultants and employees for the purchase of up to 2,737,000 shares of our common stock pursuant to our 2018 Stock Option Plan. Each stock option is exercisable at a price of $0.53 per share until April 2, 2030. Of these stock options, 1,217,000 vest as to 50% on the grant date and 50% on the one-year anniversary of the grant date, 640,000 vest as to one-third on the grant date and one-third on each anniversary of the grant date and 880,000 vest as to one-third on each anniversary of the grant date.  The Company granted the stock options to 31 U.S. Persons and 3 non U.S. Persons (as that term is defined in Regulation S of the Securities Act of 1933) and in issuing securities the Company relied on the registration exemption provided for in Regulation S and/or Section 4(a)(2) of the Securities Act of 1933. Of these options, 250,000 were granted to Richard A. Wright, our president, chief executive officer and director, and 150,000 were granted to David A. Guarino, our chief financial officer, secretary, treasurer and director. These stock options are exercisable at the exercise price of $0.53 per share until April 2, 2030.  The stock options vest as to 50% on the date of grant and 50% on the one-year anniversary of the date of grant. The fair value of each of the 2,737,000 stock options issued was calculated as $0.53 per share, which was the Black-Scholes valuation as of the grant date, corresponding to a total fair value of $1,450,610 for these options.  .  In connection with the above grant, the Company repriced a total of 600,900 stock options originally issued on April 28, 2017 from their original exercise price of $1.29 to $0.53, resulting in an additional stock compensation expense of $42,664.</p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Effective August 10, 2020, we granted 125,000 stock options to the new employee issued restricted shares above with an exercise price of $1.57 per share.  These options vest one-third on each anniversary of the grant date. The fair value of these 125,000 stock options issues was calculated at $1.57 per share, which was the Black-Scholes valuation (using the exercise price of $1.57, 10 years to maturity, annual risk-free interest rate of 0.6% and annualized volatility of 107%) as of the date of grant, corresponding to a total fair value of $185,625 for these options.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Effective November 18, 2020, we granted 45,000 stock options to the new employee issued restricted shares above with an exercise price of $1.09 per share.  These options vest one-third on each anniversary of the grant date. The fair value of these 45,000 stock options issues was calculated at $1.03 per share, which was the Black-Scholes valuation (using the exercise price of $1.09, 10 years to maturity, annual risk-free interest rate of 0.6% and annualized volatility of 121%) as of the date of grant, corresponding to a total fair value of $46,350 for these options.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">The Company's total stock compensation expense for the three-month period ending December 31, 2020 was $213,698 related to the 2018 Stock Option and for the nine-month period ending December 31, 2020 was $983,685 related to the 2018 Stock Option Plan and $54,202 relating to the 2013 Stock Option Plan. An additional expense of $226,730 will be recognized in the year ended March 31, 2021 for a total of $1,307,282 in stock compensation expense in the fiscal year ended March 31, 2021.  Additional stock compensation expense will be recognized in fiscal years 2022, 2023 and 2024 of $331,057, $104,970 and $16,557, respectively</p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><strong>Exercise of Options</strong></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Effective as of April 29, 2020, the Company issued an aggregate of 116,000 shares of our common stock upon exercise of stock options for gross proceeds of $61,480.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Effective as of July 9, 2020 the Company issued an aggregate of 188,081 shares of our common stock upon a cash-less exercise of stock options.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Effective as of August 4, 2020 the Company issued an aggregate of 48,158 shares of our common stock upon a cash-less exercise of stock options.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="text-decoration:underline">Warrants</span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><strong>Exercise of Warrants</strong></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span>Effective as of May 20, 2020, </span></span></span>the Company<span><span><span> issued an aggregate of 287,666 shares of our common stock upon exercise of our common stock purchase warrants with an exercise price of $0.90 per share for aggregate gross proceeds of $258,899.</span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Effective as of July 28, 2020 the Company issued an aggregate of 81,400 shares of our common stock upon exercise of our common stock purchase warrants with an exercise price of CAD$2.90 per share for aggregate gross proceeds of $172,521.</span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Effective as of August 5, 2020 the Company issued an aggregate of 7,999 shares of our common stock upon exercise of our common stock purchase warrants with an exercise price of CAD$2.90 per share for aggregate gross proceeds of $16,802.</span></span></span></span></p><p style="margin:0pt;text-align:justify"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span>Effective as of August 14, 2020 the Company issued an aggregate of 8,750,000 shares of our common stock upon exercise of our common stock purchase warrants with an exercise price of $0.50 per share for aggregate gross proceeds of $4,375,000.</span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Effective as of October 19, 2020, the Company issued an aggregate of 166,000 shares of our common stock upon exercise of our common stock purchase warrants with an exercise price of $0.55 per share for aggregate gross proceeds of $91,666.</p></div>
2737000
1217000
640000
880000
250000
150000
125000
45000
0.53
0.53
0.53
1.29
1.57
1.09
0.53
1.57
1.03
1450610
185625
46350
600900
42664
1.57
1.09
P10Y
P10Y
0.006
0.006
1.07
1.21
213698
983685
54202
287666
81400
7999
8750000
166000
2000000
1777777
0.90
2.90
2.90
0.50
0.55
0.55
0.55
<p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span><strong>NOTE 7 - LEASES</strong></span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span>The Company adopted ASC 842 on April 1, 2019 which requires lessees to recognize right-of-use ("ROU") asset and lease liability for all leases. The Company elected the package of transition practical expedients for existing contracts, which allowed us to carry forward our historical assessments of whether contracts are or contain leases, lease classification and determination of initial direct costs.</span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">The Company leases property under operating leases. The Company extended its short-term lease for a warehouse, originally due to expire on March 31, 2020 to March 2021, thus the Company adopted ASC 842 for this lease at the time of the extension in January 2020.  The lease rate for the extension was $3,938 per month starting April 1, 2020.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">As of July 1, 2020, the Company entered into a lease for 14,530 square feet of warehouse space from a third party through December 2021 at a rate of $7,992 per month for the first twelve months, then at a rate of $8,231 per month for the last six months of the lease.  The Company determined this lease was an operating lease under ASC 842 and using an interest rate of 7%, the Company determined that the ROU for this lease was $130,989 and the lease liability for this lease was $138,266, at inception of this lease, respectively.</span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">As of October 1, 2020, the company entered into a lease for 9,166 square feet of corporate office and warehouse space from a third party through September 2023 at a rate of $10,083 per month for the first twelve months, then at a rate of $10,385 for the next 12 months, and $10,697 for the final 12 months of the lease. The Company determined this lease was an operating lease under ASC 842 and using an interest rate of 7%, the Company determined that the ROU for this lease was $337,932 and the lease liability for this lease was $337,932, at inception of this lease, respectively. Previously, the Company leased its corporate office space with a size of 3,352  square feet leased from a third party which leased through November 2020 at the current rate of $7,891 per month. </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">As of November 1, 2020, the company entered into a lease for 2,390 square feet of corporate office space from a third party through January 2024 at a rate of $5,280 per month for the first twelve months starting January 2021, then at a rate of $5,377 for the next 12 months, and $5,497 for the final 13 months of the lease. The Company determined this lease was an operating lease under ASC 842 and using an interest rate of 7%, the Company determined that the ROU for this lease was $177,629 and the lease liability for this lease was $177,629, at inception of this lease, respectively.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span>At inception the ROU and Lease Liability was calculated based on the net present value of the future lease payments over the term of the lease. When available, the Company uses the rate implicit in the lease discount payments as the incremental borrowing rate to calculate the net present value; however, the rate implicit in the lease is not readily determinable for our corporate office lease. In this case, the Company estimated its incremental borrowing rate as the interest rate it could borrow an amount equal to the lease payments over a similar term, with similar collateral as the lease, and in a similar economic environment. The Company estimated its rate using available evidence such as rates imposed by third-party lenders to the Company in recent financings or observable risk-free interest rate and credit spreads for commercial debt of a similar duration, with credit spreads correlating to the Company's estimated creditworthiness.</span></span></span></span></span></span></span></span></span></span></span></span></p><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><span><span><span><span><span><span>For operating leases that include rent holidays and rent escalation clauses, the Company recognizes lease expense on a straight-line basis over the lease term from the date it takes possession of the leased property. The Company records the straight-line lease expense and any contingent rent, if applicable, in general and administrative expenses on the condensed consolidated statements of operations. The corporate office, lease also requires the Company to pay real estate taxes, common area maintenance costs and other occupancy costs which are included in the general and administrative expenses on the condensed consolidated statements of operations.</span></span></span></span></span></span></span></span></span></span></span></span></p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Operating Lease expense for the three and nine months ended December 31, 2020 was $64,225 and $158,440, respectively. Operating lease expense for the three and nine months ended December 31, 2019 was $23,534 and $70,043, respectively.</p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"> </p><div><div><div><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><strong>Operating Leases:</strong></span></span></span></span></span></span></td><td style="vertical-align:bottom;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;border-bottom:1px solid rgb(0, 0, 0);white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><strong>December 31, 2020</strong></p></td><td style="vertical-align:bottom;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating lease right-of-use asset - current portion</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>$</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>270,871</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating lease right-of-use asset - non-current portion</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>310,991</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Total Operating lease right-of-use asset</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:3px double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>$</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:12%;text-align:right;border-bottom:3px double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>581,862</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;border-bottom:3px double transparent;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating lease liability - current portion</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>$</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">260,528</p></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating lease liability - non-current portion</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(230, 239, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">334,262</p></td><td style="vertical-align:bottom;width:2%;text-align:left;border-bottom:1px solid transparent;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Total Operating lease liability</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:3px double rgb(0, 0, 0);background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>$</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:12%;text-align:right;border-bottom:3px double rgb(0, 0, 0);background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>594,790</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;border-bottom:3px double transparent;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Weighted average remaining lease term (in years):</span></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>  Operating leases</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>1.25</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Weighted average discount rate:</span></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>  Operating leases</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>7 %</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">Supplemental cash flow information related to leases is as follows:</span></span></p><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif">Maturities of undiscounted lease liabilities as of December 31, 2020 are as follows:</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"> </p><div><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;text-align:right;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating Leases</span></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Year ending March 31, 2021</span></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>81,875</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt;font-family:Times New Roman, Times, serif">Year ending March 31, 2022</span></p></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">259,821</p></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(230, 239, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt;font-family:Times New Roman, Times, serif">Year ending March 31, 2023</span></p></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">191,379</p></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span>Year ending March 31, 2024</span></span></span></p></td><td style="vertical-align:bottom;border-bottom:1pt solid rgb(0, 0, 0);text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:1pt solid rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">119,150</span></span></p></td><td style="vertical-align:bottom;border-bottom:1pt solid transparent;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>  Total lease payments</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-top:1pt solid rgb(0, 0, 0);text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;border-top:1pt solid rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>652,225</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-top:1pt solid transparent;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Less: Imputed interest</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-bottom:1pt solid rgb(0, 0, 0);text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:1pt solid rgb(0, 0, 0);text-align:right;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>(57,435</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-bottom:1pt solid transparent;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>)</span></span></span></span></span></span></td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>  Total lease obligations</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-top:1pt solid rgb(0, 0, 0);border-bottom:2.25pt double rgb(0, 0, 0);text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;border-top:1pt solid rgb(0, 0, 0);border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>594,790</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-top:1pt solid transparent;border-bottom:2.25pt double transparent;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div></div></div>
3938
8231
10385
5377
14530
9166
3352
2390
7992
10083
7891
5280
0.07
0.07
0.07
0.07
130989
337932
177629
581862
138266
337932
177629
594790
10697
5497
64225
158440
23534
70043
<div><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span><strong>Operating Leases:</strong></span></span></span></span></span></span></td><td style="vertical-align:bottom;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;border-bottom:1px solid rgb(0, 0, 0);white-space:nowrap;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><strong>December 31, 2020</strong></p></td><td style="vertical-align:bottom;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating lease right-of-use asset - current portion</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>$</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>270,871</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating lease right-of-use asset - non-current portion</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>310,991</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;border-bottom:1px solid transparent;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Total Operating lease right-of-use asset</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:3px double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>$</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:12%;text-align:right;border-bottom:3px double rgb(0, 0, 0);background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>581,862</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;border-bottom:3px double transparent;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating lease liability - current portion</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>$</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">260,528</p></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating lease liability - non-current portion</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;border-bottom:1px solid rgb(0, 0, 0);background-color:rgb(230, 239, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">334,262</p></td><td style="vertical-align:bottom;width:2%;text-align:left;border-bottom:1px solid transparent;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Total Operating lease liability</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;border-bottom:3px double rgb(0, 0, 0);background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>$</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:12%;text-align:right;border-bottom:3px double rgb(0, 0, 0);background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>594,790</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;border-bottom:3px double transparent;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Weighted average remaining lease term (in years):</span></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>  Operating leases</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>1.25</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Weighted average discount rate:</span></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:left;width:2%;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>  Operating leases</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:1%;text-align:left;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;width:12%;text-align:right;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>7 %</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div>
P1Y3M
<div><table border="0" cellpadding="0" cellspacing="0" style="width:100%;border-collapse:collapse;font-size:10pt;border-color:#000000"><tbody><tr style="background-color:rgb(255, 255, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;text-align:right;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:center;white-space:nowrap;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Operating Leases</span></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:center;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Year ending March 31, 2021</span></span></span></span></span></span></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>81,875</span></span></span></span></span></span></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt;font-family:Times New Roman, Times, serif">Year ending March 31, 2022</span></p></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">259,821</p></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(230, 239, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt;font-family:Times New Roman, Times, serif">Year ending March 31, 2023</span></p></td><td style="vertical-align:bottom;text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;text-align:right;width:12%;background-color:rgb(230, 239, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">191,379</p></td><td style="vertical-align:bottom;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span>Year ending March 31, 2024</span></span></span></p></td><td style="vertical-align:bottom;border-bottom:1pt solid rgb(0, 0, 0);text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:1pt solid rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(255, 255, 255)"><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif">119,150</span></span></p></td><td style="vertical-align:bottom;border-bottom:1pt solid transparent;width:2%;text-align:left;background-color:rgb(255, 255, 255)"> </td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>  Total lease payments</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-top:1pt solid rgb(0, 0, 0);text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;border-top:1pt solid rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>652,225</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-top:1pt solid transparent;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr><tr style="background-color:rgb(255, 255, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>Less: Imputed interest</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-bottom:1pt solid rgb(0, 0, 0);text-align:left;width:1%;background-color:rgb(255, 255, 255)"> </td><td style="vertical-align:bottom;border-bottom:1pt solid rgb(0, 0, 0);text-align:right;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>(57,435</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-bottom:1pt solid transparent;background-color:rgb(255, 255, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>)</span></span></span></span></span></span></td></tr><tr style="background-color:rgb(230, 239, 255)"><td style="padding-right:5.4pt;padding-left:5.4pt;vertical-align:bottom;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>  Total lease obligations</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-top:1pt solid rgb(0, 0, 0);border-bottom:2.25pt double rgb(0, 0, 0);text-align:left;width:1%;background-color:rgb(230, 239, 255)"> </td><td style="vertical-align:bottom;border-top:1pt solid rgb(0, 0, 0);border-bottom:2.25pt double rgb(0, 0, 0);text-align:right;width:12%;background-color:rgb(230, 239, 255)"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><span><span><span><span>594,790</span></span></span></span></span></span></td><td style="vertical-align:bottom;border-top:1pt solid transparent;border-bottom:2.25pt double transparent;width:2%;text-align:left;background-color:rgb(230, 239, 255)"> </td></tr></tbody></table></div>
81875
259821
191379
119150
652225
57435
594790
<div><div><p style="text-align:justify"><span style="font-size:10pt"><span style="font-family:Times New Roman,Times,serif"><strong>NOTE 9 - SUBSEQUENT EVENTS</strong></span></span></p><div><div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify">Effective as of January 14, 2021 the Company issued an aggregate of 242,037 shares of our common stock to two non-employees in consideration for services rendered to our Company.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify">Effective as of February 1, 2021, the Company issued 2,000,000 shares of our common stock upon exercise of our common stock purchase warrants with an exercise price of $0.55 per share for aggregate gross proceeds of $1,100,000.</p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify"> </p><p style="font-size:10pt;font-family:Times New Roman, Times, serif;margin-top:0pt;margin-bottom:0pt">Effective as of February 8, 2021, the Company issued 1,777,777 shares of our common stock upon exercise of our common stock purchase warrants with an exercise price of $0.55 per share for an aggregate gross proceeds of $977,777.</p></div></div></div></div>
<div><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif"><strong>NOTE 8 – RISKS AND UNCERTAINTIES</strong></p><p style="margin:0pt"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify">In December 2019, a novel strain of COVID-19 was reported in China. Since then, the COVID-19 has spread globally including across North America and the United States. The spread of COVID-19 from China to other countries has resulted in the World Health Organization (WHO) declaring the outbreak of COVID-19 as a “pandemic,” or a worldwide spread of a new disease, on March 11, 2020.</p><p style="margin:0pt;text-align:justify"> </p><p style="margin-top:0pt;margin-bottom:0pt;font-size:10pt;font-family:Times New Roman, Times, serif;text-align:justify">Specifically, the Company cautions that our business could be materially and adversely affected by the risks, or the public perception of the risks, related to the outbreak of COVID-19. To date, the Company has managed to operate successfully throughout the pandemic without any material disruptions to our supply chain.  Although retailers which carry our products may be considered essential businesses and therefore be allowed to remain operational, they may experience significantly reduced demand. The risk of a pandemic, or public perception of the risk, could cause customers to avoid public places, including retail properties, and could cause temporary or long-term disruptions in our supply chains and/or delays in the delivery of our inventory to our customers. Further, such risks could also adversely affect retail customers’ financial condition, resulting in reduced spending on our products, which are marketed as premium products. “Shelter-in-place” or other such orders by governmental entities could also disrupt our operations, if our employees or the employees of our sourcing partners who cannot perform their responsibilities from home, are not able to report to work. Risks related to an epidemic, pandemic or other health crisis, such as COVID-19, could also lead to the complete or partial closure of one or more of our co-packing facilities or operations of our sourcing partners.</p></div>