UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C.D.C. 20549

FORM 10-K

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

For the fiscal year endedDecember 31 2018, 2021

ORor

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

Commission file number333-192060

MOUNT TAM BIOTECHNOLOGIES, INC.Fortium Holdings Corp.

(Exact nameName of registrantRegistrant as specifiedSpecified in its charter)Its Charter)

(425) 214-4079(800)203-5610

(Registrant'sRegistrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by checkmarkcheck mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by checkmarkcheck mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ ☒ No ☒☐

Indicate by checkmarkcheck mark whether the registrant (1) has (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Sec.229.405(§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

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

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant ishas filed a shell company (as defined in Rule 12b-2report on and attestation to its management’s assessment of the Act).effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Yes ☐ No ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant, as of June 30, 2018,2021, the last business day of the registrant'sregistrant’s most recently completed second fiscal quarter, was approximately $751,529$2,717,917 based upon the last sales price of the common stock as of such date. Solely for purposes of this disclosure, shares of common stock held by executive officers, directors and beneficial holders of 10% or more of the outstanding common stock of the registrant as of such date have been excluded because such persons may be deemed to be affiliates.

AsThe number of April 4, 2019, there are 55,710,702 shares outstanding of the registrant’s classes of common stock, outstanding. as of March 10, 2022 was 8,400,000 shares.

Documents incorporated by reference: NoneDOCUMENTS INCORPORATED BY REFERENCE

None.

TABLE OF CONTENTS

i

SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

This Annual Report on Form 10-K contains forward-looking statements that involve assumptions, and describe our future plans, strategies, and expectations. Such statements are generally identifiable by use of the words "may," "will," "should," "expect," "anticipate," "estimate," "believe," "intend," or "project" or the negative of these words of other variations on these words or comparable terminology. These statements are expressed in good faith and based upon a reasonable basis when made, but there can be no assurance that these expectations will be achieved or accomplished.

Such forward-looking statements include statements regarding, among other things, (a) the potential markets for our products, our potential profitability, and cash flows (b) our growth strategies, (c) anticipated trends in our industry, (d) our future financing plans and (e) our anticipated needs for working capital. This information may involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from the future results, performance, or achievements expressed or implied by any forward-looking statements. These statements may be found under "Item 1. Business" and "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations," as well as in this Annual Report on Form 10-K generally. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors as described in this Annual Report on Form 10-K generally. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this Annual Report on Form 10-K will in fact occur.

Although forward-looking statements in this Annual Report on Form 10-K reflect the good faith judgment of our management, forward-looking statements are inherently subject to known and unknown risks, business, economic and other risks and uncertainties that may cause actual results to be materially different from those discussed in these forward-looking statements. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this Annual Report on Form 10-K. We assume no obligation to update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this report, other than as may be required by applicable law or regulation. Readers are urged to carefully review and consider the various disclosures made by us in our reports filed with the Securities and Exchange Commission which attempt to advise interested parties of the risks and factors that may affect our business, financial condition, results of operation and cash flows. Our actual results may vary materially from those expected or projected.

ii

PART I

ITEM 1. Business.BUSINESS.

Throughout this Annual Report on Form 10-K, the terms "we," "us," "our," "registrant,"“we,” “us,” “our,” “registrant,” and "Company"“Company” refer to Mount Tam Biotechnologies, Inc.Banner Energy Services Corp., a Nevada corporationcorporation.

Cautionary Note Regarding Forward Looking Statements

This Report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our entrance into the cannabis industry through the operation of cannabis distribution licenses, the anticipated acquisition of Treehouse Company, Inc. and whereour ability to pay the full purchase price and obtain regulatory approval for the transfer of licenses, our planned operations under our Joint Venture Agreement with 7Seeds Inc., and Firebreak Associates, Inc. and our ability to use the license thereunder to establish and operate cannabis retail stores at one or more locations, our ability to develop and grow our sporting goods and apparel business or generate revenue therefrom, our working capital needs, potential financings through the sale of our common stock or other securities, the subsequent use and sufficiency of the proceeds from any capital raising methods we may undertake to fund our operations, our further development and implementation of our business plan and our ability to locate sources of capital necessary to meet our business needs and objectives. All statements other than statements of historical facts contained in this report, including statements regarding our future financial position, liquidity, business strategy and plans and objectives of management for future operations, are forward-looking statements. The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “will,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs.

The results anticipated by any or all of these forward-looking statements might not occur. Important factors, uncertainties and risks that may cause actual results to differ materially from these forward-looking statements include those described in Item 1A. – Risk Factors. We undertake no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise.

Summary of Risk Factors

Investing in our securities involves a high degree of risk. Investors should carefully consider the risks described below concerning our planned cannabis operations, in addition to the risks described under “Item 1A – “Risk Factors,” before deciding to invest in our securities.

Set forth below is a summary of some of the principal risks we face with respect to our business:

These and other material risks we face are described more fully in Item 1A. – Risk Factors, which investors should carefully review prior to making an investment decision with respect to the Company or its wholly-owned subsidiary Mount Tam Biotechnologies, Inc.securities.

Description of Business

The terms “we,” “us,” “our,” “registrant,” “Fortium Holdings”, and the “Company” refer to Fortium Holdings Corp. (formerly Banner Energy Services, Corp. “Banner Energy”)), a Nevada corporation. Set forth below is an overview of the Company’s corporate history and business development. Because of our focus on our new cannabis business, much of the following discussion, including regarding the competitive and regulatory environment we face, is focused on that business and the cannabis industry.

On November 18, 2019, the Company merged with Banner Midstream Corp., a Delaware corporation ("Mount Tam"(“Banner Midstream”),. Banner Midstream then had two operating subsidiaries: Pinnacle Frac Transport LLC, a Texas limited liability company (“Pinnacle Frac”) and effective October 2018, its wholly-owned subsidiary Mount Tam Therapuetics, Inc.,Capstone Equipment Leasing LLC, a Delaware corporation.Texas limited liability company (“Capstone”) as of November 18, 2019.

Overview

The Company was established in November 2011 underAdditionally, immediately following the name TabacaleraYsidron. On August 13, 2015, the registrant entered into a Share Exchange and Conversion Agreement (the "Exchange Agreement") by and among the registrant and a holder of a majorityclosing of the issuedmerger, the Company and its secured debt holders finalized an agreement whereby the debt holders took possession of the Company’s biotechnology assets and assumed certain other Company obligations in lieu of payment by the Company of the amounts due in the secured debt instruments.

On March 27, 2020, Banner Midstream was acquired by Ecoark Holdings, Inc., (“Ecoark”) pursuant a Stock Purchase Agreement, dated March 27, 2020 (the “Banner Purchase Agreement”), between Ecoark and Banner Energy. Pursuant to the Banner Purchase Agreement, Ecoark acquired 100% of the outstanding capital stock of Banner Midstream in consideration for 1,789,041 shares of common stock of Ecoark valued at $2.72 per share and assumed approximately $11,774,000 in short-term and long-term debt of Banner Midstream and its subsidiaries.

As a result of the registrant (the "Majority Shareholder"Banner Purchase Agreement, the Company did not have any operating subsidiaries from March 28, 2020 until March 18, 2021, when the Company formed Norr LLC (“Norr”), ona Nevada limited liability company and wholly-owned subsidiary of the one hand,Company, and Mount Tam,commenced operations as a sports equipment and apparel manufacturer and retailer. Prior to organization of Norr, the stockholdersCompany’s Chief Executive Officer had explored this business opportunity and commenced preparation of Mount Tam ("Mount Tam Stockholders"a business plan for the business. On March 23, 2021, the Company engaged the services of two consultants and entered into consulting agreements through Norr pursuant to which each consultant provides services to Norr which were subsequently replaced in December 2021 when we also added a third independent contractor to assist in our Norr business. The terms of these services and compensation are more fully described below.

On September 9, 2021, the Company formed Elysian Premium Corp., a Colorado corporation (“Elysian”). On September 14, 2021, Elysian entered into a Stock Purchase Agreement (“SPA”) with Treehouse Company, Inc. (“Treehouse”), and its sole shareholder Alex Gosselin (the “Seller”) pursuant to which Elysian agreed to purchase 80% of the holderscapital stock of certain convertible promissory notesTreehouse from the Seller for $200,000. Treehouse’s key assets consist of Mount Tam ("Mount Tam Noteholders"two licenses for commercial cannabis distribution in the State of California, license numbers C11-0000999 and C9-0000379. The acquisition of Treehouse will close upon delivery of the $200,000 purchase price to the escrow agent to be held until release upon receipt of the requisite regulatory approval for the transaction. As of March 9, 2022, the acquisition has not closed.

Simultaneously with the SPA, Elysian and the Seller entered into a Memorandum of Understanding with Treehouse pursuant to which the parties agreed that Elysian will purchase the remaining 20% of the capital stock of Treehouse for an additional $200,000 and enter into a second Stock Purchase Agreement on substantially similar terms to the SPA in connection therewith, subject to state and local regulatory clearance of the transfer of ownership of the two cannabis licenses owned by Treehouse. The SPA provides that if required state and local regulatory clearance is not obtained, the SPA will terminate, Elysian will return the Treehouse capital stock to the Seller and the Seller will return the $200,000 purchase price to Elysian.

On December 2, 2021, Elysian, the Company, 7Seeds Inc. (“7Seeds”), and Firebreak Associates, Inc. (“Firebreak”) (collectively, the “Parties”) entered into a joint venture agreement (the “JVA”). Pursuant to the Exchange Agreement,JVA, 7Seeds, Firebreak and Elysian agreed to cooperate in the Company acquired allopening and operation of cannabis distribution facilities as follows: (i) 7Seeds agreed to provide consulting services to Elysian for an initial term of 36 months, including identifying locations to open new commercial cannabis businesses, including without limitation dispensaries, delivery stores, and other businesses engaging in cannabis related activities (the “Elysian Stores”), securing proper state and local licensure, planning commercial cannabis business operations at those locations in exchange for the compensation described below, and (ii) Firebreak, as the owner of certain trademarks and service marks (the “CannaBlue Marks”), licensed the CannaBlue Marks to Elysian for an initial term of five years, pursuant to which Elysian obtained the option to open the Elysian Stores under the name “CannaBlue” and making use of the issuedCannaBlue Marks. The Elysian Stores will be owned and outstanding equity securitiesoperated entirely by Elysian or its affiliates. The license for the CannaBlue Marks under the JVA is for use in connection with retail Elysian Stores and related activities in the United States, subject to the following exceptions: (i) a 99-mile radius from each of Mount TamOakland, CA and South Lake Tahoe, CA are excluded from the Mount Tam Stockholderspermitted territory in which Elysian may use the license; (ii) the license excludes the use of CannaBlue Marks for online stores and related activities from the Mount Tam Noteholders becomepermitted uses, and (iii) the controlling stockholderslicense to use the Cannablue marks is non-exclusive with respect to (A) the online promotion, advertising, and sales of products bearing the Cannablue Marks; and (B) the sale and distribution of Firebreak’s private label products by licensed cannabis distributors.

In exchange for the license, Elysian has agreed to pay Firebreak a $5,000 annual license fee, and a quarterly royalty fee equal to the greater of 6% of gross sales or $5,000 for each Cannablue-branded Elysian Store that did not directly result from the consulting services of 7Seeds. In exchange for the consulting services, Elysian has agreed to pay 7Seeds a monthly fee beginning at $5,000 to be incrementally increased up to $15,000 during the initial term of the registrant. The transactions contemplated by the Exchange Agreement are hereinafter referredservices. Further, for each Elysian Store for which 7Seeds directly assists in obtaining a cannabis license (exclusive of California license numbers C11-0000999 and C9-0000379), Elysian has agreed to as the "Share Exchange." Prior to the Share Exchange, the registrant waspay 7Seeds a "shell company" (as such term is definedone-time issuance of $50,000 in Rule 12b-2 under the Exchange Act), however, after the Share Exchange the registrant is no longer a shell company.

Effective on August 31, 2015, the registrant changed its name from TabacaleraYsidron, Inc. to Mount TAM Biotechnologies, Inc.  The name change was effected through a parent/subsidiary short-form mergershares of Mount TAM Biotechnologies, Inc., our wholly-owned Nevada subsidiary which we formed solely for the purpose of the name change, with and into the Company, with the Company as the surviving corporation.  With the exception of the name change, there were no changes to the Company's Articles of Incorporation or Bylaws. There will be no mandatory exchange ofFortium’s common stock certificates.

We are an emerging biopharmaceutical company established to optimize, develop and bring to market a portfolio of products focused on improving the health and wellbeing of individuals afflicted with serious diseases, with a lead product targeting systemic lupus erythematosus ("SLE") and a strategy to bring to market novel therapeutics across a rangequarterly royalty fee of serious disease areas.6% of gross sales.

On August 17, 2014, Mount TamIn December 2021, Norr entered into a Research Collaborationterm sheet for an Advisory Agreement with three individual contractors. The Advisory Agreements, were effective upon the signing of the definitive documents on January 24, 2022 and License Agreement (the "Buck Institute License Agreement") with The Buck Instituteare for Research on Aging, an independent non-profit research organization devoted to aging and the diseasesa period of aging based in Northern California ("Buck Institute"), pursuant to which Mount Tam secured a worldwide exclusive license to certain compounds and technology to develop, manufacture and commercialize these compounds in the field of autoimmune diseases.  Our most advanced product candidate is TAM-01, a preclinical stage compound, which represents what we believe tofive years. If any advisor voluntarily or involuntarily terminates his services, his agreement will automatically terminate. All advisors will be a promising therapeutic candidatepaid $1,000 per month for the treatmentfirst eighteen months immediately following execution of SLE.the Advisory Agreement. In July 2016 an amendment was signed which broadenedaddition to the licensecash compensation, the Company shall compensate the advisors who have not terminated their relationship with Norr based on the following events (amounts have been aggregated among the advisors):

The maximum ownership the advisors may collectively in Norr shall be 25%.

In addition, the advisors may receive shares of Fortium common stock based on meeting enumerated net operating free cash flow thresholds ranging from $1,000,000 to include any and all conditions, human and veterinary.  In February 2017 we announced that we were advancing into Discovery TAM-03,$5,000,000, for a novel rapamycin analog ("rapalog") which we considertotal potential Fortium equity compensation to be a potential candidate for addressing an unmet need in several important cancer types.  In July 2017 we announced that we had entered into collaboration with a prominent academic laboratory in the fieldthese advisors of neurodegenerationup to explore the potential$900,000 of our compounds in Parkinson’s Disease.shares of Fortium common stock.

On October 18, 2018,March 8, 2022, the “Company” and Mount Tam Biotechnologies, Inc., a Delaware corporation, its wholly-owned Delaware subsidiary (“Mount Tam Delaware”),Company entered into a stock purchase agreement (the “SPA”) with ARJ Consulting, LLC, a New York limited liability company (the “Buyer”), pursuant to whichwhereby the Company sold 100%paid a non-refundable $50,000 purchase price to Firebreak Associates, Inc. in exchange for a total of 5% equity in any of the capital stockcorporations that Firebreak Associates, Inc. controls if they are selected through the State of California’s retail cannabis license lottery process in andEncinitas, California.

The Company is subject to a number of Mount Tam Delaware to the Buyer (the “Sale Transaction”). Prior to the Sale Transaction, the Company caused Mount Tam to transfer certain assets,risks, including the Buck Institute License Agreement,need to develop the Elysian and Norr businesses and/or acquire and successfully operate a new business, the risk of our need for additional capital and potentially attempting to raise such capital through equity and/or debt financings. See Part II, Item 1A, herein and Item 1A “Risk Factors” included in the Annual Report on Form 10-K for the year ended December 31, 2020 filed February 4, 2021.

On July 31, 2020, Mr. Jay Puchir notified the Board of Directors (the “Board”) that Mount Tam Delawarehe was holding to another wholly-owned subsidiaryresigning as the Chairman of the Board and Chief Executive Officer of the Company. On July 31, 2020, the Board appointed Mr. Richard Horgan as the Chief Executive Officer, and as our sole director and Chairman of the Board, effective August 1, 2020.

On January 7, 2021, shareholders of the Company Mount Tam Therapeutics, Inc., a newly formed (October 2018) Delaware corporation. At the timerepresenting approximately 57% of the Sale Transaction Mount Tam possessed certain Net Operating Losses and tax credits. Pursuantoutstanding common shares, acted by written consent in lieu of a meeting to approve an amendment to the termsCompany’s Articles of Incorporation to change the name of the SPA,Company to Fortium Holdings Corp. The Financial Industry Regulatory Authority approved the Buyer purchased Mount Tam forname change on May 18, 2021.

Competition and Market Conditions

We will face substantial competition in our efforts to grow our operations, particularly as we shift our focus towards the retail sale of cannabis products. The cannabis retail industry is fiercely competitive, as a purchase price of $410,000.

All company operations are based in the United States. As of the date of this report, we had no products that have obtained marketing approval in any jurisdiction. Additionally, we have not generated revenues since inception and do not expect to do so in the foreseeable future due to the early stage nature of our current product candidate.

Background on the Potential SLE Market

As of the date of this Report, we were focusing the development of our lead product candidate in the field of SLE, an autoimmune disorder where current treatments are often not adequate to fully control disease and a condition where a serious unmet need remains.

According to the Lupus Foundation of America, 1.5 million Americans have some form of lupus although some other estimates are more conservative. The exact etiology of lupus is unknown. As an autoimmune disease, the immune system is unable to properly differentiate between healthy tissues and foreign invaders, leading the immune system to attack healthy tissues. This may cause inflammation of the joints, heart, lungs, kidneys, brain and blood vessels. Lupus is a disease that goes through stages of remission and flares.

SLE is the most serious form of lupus. It is a chronic, inflammatory disorder that can damage many parts of the body, including the skin, joints and internal organs. Lupus nephritis ("LN") is a common and very serious complication for people with SLE, causing inflammation of the kidneys that may lead to significant illness and even death.

There is currently no known cure for SLE and no treatment that fully stabilizes the disease. Patients diagnosed with lupus are treated with a range of therapies including anti-malarials, corticosteroids, immunosuppressants, and newer biologic agents that primarily address the symptoms of the disease.  Despite the range of available therapies, the burden of disease for SLE patients remains high, with significant morbidity and mortality seen in this population even with best currently available care.  SLE also brings a strong economic impact to patients and to society at large, both in direct and indirect economic impacts due to increased medical costs, lost wages for patients and for caregivers.

Our Product Candidates:

TAM-01

Our lead product candidate, TAM-01, is a novel rapalog which exerts its action through direct binding and inhibition of the mammalian Target of Rapamycin ("mTOR"). mTOR is a key regulatory pathway which is altered in individuals suffering from a range of disorders including autoimmune diseases such as lupus. Based on extensive research over the last several decades we now understand that mTOR inhibitors, particularly rapamycin, may reduce disease activity and normalize T cell activation-induced calcium fluxing in SLE patients, and may also normalize immune function through suppression of autoreactive B cells.

The only rapalogs currently approved by FDA are rapamycin (sirolimus) and its first generation analogs (temsirolimus, everolimus), but none of these are approved for use in SLE patients. Unfortunately their potential utility as therapeutic agents for the treatment of many chronic diseases such as SLE is limited due to their significant side effects, including impaired glucose tolerance, insulin resistance, and lipid dysregulation. Our lead product candidate, TAM-01 is a novel and proprietary rapalog, which has been shown in extensive preclinical pharmacology studies to deliver the high therapeutic efficacy of rapamycin while significantly reducing or abolishing some of its side effects.

Discovery, lead optimization and pre-development activities (including preliminary scale up) have been largely completed for TAM-01 and it is ready for initiation of cGMP manufacturing to be followed by IND-enabling safety studies (“GLP Tox studies”). Agrowing number of pharmacological studiescompanies, including many larger, well-capitalized cannabis retail companies, have entered the market in validated disease models (such as the NZBW/F1J SLE mouse model) have demonstrated that TAM-01 exhibits dose-dependent efficacy similaran attempt to rapamycin or temsirolimus. At 14-week dosage, TAM-01 is shown to reduce disease progression as measured by proteinuria, renal IgG and IgM deposition, anti-dsDNA antibody titers and ANA antibody titers. Examination of the kidney pathology of the NZBW/F1J mice showed that TAM-01 ameliorated kidney disease and reduced renal IgG and IgM deposits similarly to temsirolimus. Additionally, other studies have shown that, in contrast to both rapamycin and temsirolimus, TAM-01 has minimal impactcapitalize on glucose levels, glucose tolerance, did not induce hyperlipidemia (cholesterol and triglyceride elevations), and had minimal impact on reticulocyte counts.

Although rapamycin and other rapalogs are thought to act primarily through the inhibition of the protein complex mTOR Complex 1 ("TORC1"), it is now well established that these drugs also have inhibitory effects on mTOR Complex 2 ("TORC2").   Our studies have shown TAM-01 to be a more selective TORC1 inhibitor vs. rapamycin and its analogs (having greater TORC1 inhibitory activity relative to TORC2 inhibitory activity) and we believe that this greater selectivity is the reason TAM-01 has shown a superior adverse event profile in mice vs. other rapalogs while still maintaining a strong efficacy profile.  This theory, however, has not been proven in clinical trials and the superior adverse event profile seen in mice may not be demonstrated in clinical trials in humans.

TAM-01 exhibits superior oral bioavailability vs. rapamycin, which is expected to result in reduced variability of absorption and superior pharmacokinetics, making it suitable for administration via a flexible dosing regimen.  TAM-01 has completed preliminary non-GLP 14-day toxicology, safety, PK, ADME, preliminary scale up manufacturing studies, and analytic and purification methods have been established.  We are ready to initiate cGMP manufacturing and GLP studies in order to prepare and submit an Investigational New Drug ("IND") to FDA. We intend to advance TAM-01 to phase 1 clinical developmentlenient government restrictions in the United States within 18-24 monthscompared to prior periods. We also face competition from the time we have completed our fundraising targets and recruitment of all required personnel. There can be no assurance, however, that the Company will be able to begin phase 1 clinical development in this time frame, if at all.

Rapalogs have been used in cancer therapy for some time to treatcompanies which offer a broader range of cancers.  Novartis' Affinitor/Votubia (everolimus),products than we intend to market in our cannabis operations, such as tobacco, alcohol, cosmetic products and wellness products. Among the leading rapalog for treating cancer, was first approved in 2009barriers to treat advanced kidney cancer andentry is now approved to treat a range of other cancers including certain breast and pancreatic cancers as well as tuberous sclerosis complex.  Novartis reported sales of Afinitor/Votubia in 2018 were approx. $1.6 billion.  

Real unmet need remains in these cancers however, with median progression free survival (PFS) in clinical trials with Afinitor reportedthe requirement to be less than 1 yearlicensed in several important cancer types.  An improved therapy that could meaningfully increase PFS, or as/more importantly, overall survival (OS), that still provided acceptable tolerability would likely be welcome by both healthcare providersstate and patients and we believe that by altering the mTORC1:2 inhibitory profile and other important pharmaceutical characteristics, e.g. potency and PK profiles we have the potential to accomplish this.

Given the unmet need and the unique characteristics of TAM-01,local jurisdictions. To this end, we are in the process of undertakingacquiring two commercial cannabis licenses in California.

Numerous other factors are expected to be critical to our ability to be competitive in this endeavor, including product quality and prices, brand strength, production and distribution capabilities and geographic scope of operations and market presence. Additionally, market conditions can shift demand for cannabis products, such as competitive pricing, the first stepseffects of inflation, regulatory changes and economic or geopolitical turmoil. In the short-term we intend to characterizefocus our commercial cannabis efforts in a single state, California, which may render us at a relative competitive disadvantage when compared to other cannabis retail companies whose operations expand into a larger geographic territory for a number of reasons including longer operating histories, greater access to capital, industry relationships, brand recognition and others. In addition, many competitors are able to commercialize their cannabis products through online sales, which we will not be able to do using the cancer killing potential of TAM-01 through in vitro and in vivoexperimentation.

However, preclinical and clinical development of cancer therapeutics is particularly challenging and we are at an early stageCannablue Marks due to restrictions in the characterizationJVA that provides for the license. Additionally, many of TAM-01our competitors are more vertically integrated, including some with “seed-to-sale” operations in which they cultivate, produce, sell or distribute their cannabis or cannabis-related products entirely or mostly in-house or by using a well-structured network of interrelated parties, which allows them to enjoy reduced operational costs and a higher volume of sales than is anticipated for our planned cannabis operations. Alternatively, we expect to depend on third parties to obtain products to sell at our stores, and on the development and maintenance of key business and industry relationships in order to execute our business plan, including opening new stores and potentially expanding to new regions in the future.

With respect to our Norr operations, we face competition from larger competitors with longer operating histories, greater access to capital and human resources and vertically integrated sporting goods operations, including many larger retail and online companies which offer a broader range of sporting and athletic gear and apparel than our Norr product offerings. We also face competition from smaller online and retail businesses which offer similar products to ours. Because of these competitive conditions and our limited capital, we currently focus on online sales for our Norr products.

Government Regulation

Below is a discussion of the federal and state-level regulatory regimes in the jurisdictions where the Company is currently operating through its subsidiaries.

U.S. Federal Regulation of Cannabis

The U.S. federal government regulates drugs through the Controlled Substances Act (21 U.S.C. § 811), which places controlled substances, including cannabis, in a schedule. Cannabis is classified as a potential cancer therapeutic with many challenges, both known and unknown, lying ahead and so probability of product approval and commercialization must be considered low until more data are generated to support TAM-01s potentialSchedule I controlled substance. A Schedule I controlled substance is defined as a clinical development candidate.

Parkinson’s Disease (PD)substance that has no currently accepted medical use in the United States, a lack of safety for use under medical supervision and a high potential for abuse. Schedule I controlled substances are federally illegal and the manufacturing, sale and use of cannabis is a devastating disease affecting around one million individualsviolation of federal law.

Due to the conflicting views between state legislatures and the federal government regarding cannabis, cannabis businesses are subject to inconsistent laws and regulations. The Obama Administration attempted to address these inconsistencies in the US, impacting qualityCole Memorandum that Deputy Attorney General James Cole sent to all U.S. Attorneys in August 2013, which outlined certain priorities for the Department of lifeJustice relating to the prosecution of cannabis offenses. The Cole Memorandum noted that, in jurisdictions that have enacted laws legalizing cannabis in some form and that have also implemented strong and effective regulatory and enforcement systems to control the cultivation, processing, distribution, sale and possession of cannabis, conduct in compliance with such laws and regulations was not a prosecution or enforcement priority for both patientsthe Department of Justice. However, the Department of Justice did not provide (and has not provided since) specific guidelines for what regulatory and caregiversenforcement systems would be deemed sufficient under the Cole Memorandum. However, on January 4, 2018, then U.S. Attorney General Jeff Sessions issued a new memorandum which rescinded the Cole Memorandum, largely restoring the uncertainty as to potential federal regulatory enforcement on the cannabis industry.

While there have been efforts to reform federal cannabis law, including bills proposed in Congress which would address multiple issues regarding the cannabis industry, from banking and costing the US economy approx. $20B annually. Dysfunction in the process of autophagy (the natural process for ‘cellular cleanup’ where protein debris is ‘recycled’) is a key component in the development of Parkinson's disease, with PD patients showing altered autophagy and increased mTOR activity.

As it is well known that mTORC1 inhibitors can increase the rate of autophagy, the potential for rapalogstax reform to address unmet need in Parkinson’s Disease (PD) has been explored in multiple preclinical models and rapamycin has shown promise in this area. Given TAM-01’s pharmacologic profile and potential to deliver a unique combination of efficacy and tolerability vs. current rapalogs, Mount Tam has entered into preclinical studies to explore its compounds potential in this area, including TAM-01.  These are early investigations into this historically challenging area for clinical development, with Mount Tam’s goal being to quickly determine the potential of our compounds in this area and to determine our future pathway in PD.

TAM-03

TAM-03 is a novel rapalog with a differentiated selectivity profile of TORC1 vs. TORC2 inhibition (as compared to rapamycin, to on-market rapalogs temsirolimus and everolimus, and to TAM-01), and also, favorable potency and bioavailability profiles. We believe that this overall profile makes it an appropriate candidate for further discovery work as a cancer therapy target, and potentially other indications.   As with TAM-01, we are in the process of

undertaking the first steps to characterize the cancer killing potential of TAM-03 through both in vitro and in vivo

experimentation.  We are also exploring TAM-03’s potential in Parkinson’s Disease through exploratoryin vivo models as part of an ongoing collaboration with an academic laboratory with significant experience in studying neurodegenerative diseases.  Initial results for TAM-03 in severalin vivo Parkinson’s Disease studies are very encouraging showing impressive efficacy at multiple dose levels and suggesting that TAM-03 has the potential to become an important clinical candidate to treat this devastating disease.

Our Suppliers and Manufacturers

We do not own or operate, andfull legalization, as of the date of this Report, had no plans to establish, any manufacturing facilities. We will rely on third-party contract manufacturers ("CMOs") for the manufacture of our product candidates for larger scale preclinical and clinical testing, as well as for commercial quantities of any product candidates that are approved.

We do notnone have any current contractual relationships for the manufacture of commercial supplies of our product candidates if they are approved, and we intend to enterbeen passed into agreements with a third-party contract manufacturer and one or more back-up manufacturers for the commercial production of our product candidates as they near potential approval.

Any drug products to be used in clinical trials and any approved product that we may commercialize will need to be manufactured in facilities, and by processes, that comply with FDA's current good manufacturing practice ("cGMP") requirements and comparable requirements of the regulatory agencies of other jurisdictions in which we are seeking approval.

Competition

We are a development company with no products on the marketlaw. Therefore, as of the date of this Report. We face competition from other companies, academic institutions, governmental agenciesReport, cannabis remains illegal under federal law, although federal enforcement policies have largely deferred to state regulations which are discussed below.

State Cannabis Law

State laws that permit and other publicregulate the production, distribution and private research organizationsuse of cannabis for collaborative arrangementsmedicinal and adult use are in direct conflict with pharmaceuticalfederal law. Although certain states and biotechnology companies, in recruitingterritories of the U.S. authorize medical and/or adult use cannabis production and retaining highly qualified scientificdistribution by licensed or registered entities, under U.S. federal law, the possession, use, cultivation and management personnel and for licenses to additional technologies. Manytransfer of our competitors will have substantially greater financial, technical and human resources than we have. Our success depends in part on our ability to build, obtain regulatory approval for and market acceptance of, and actively manage a portfolio of drugs that addresses serious unmet medical needs.

If approved, our lead compound TAM-01 would compete with currently marketed drugs and therapies used for treatment of SLE and potentially with drug candidates currently in preclinical or clinical development. Patients diagnosed with SLE are currently treated with a range of therapies with varied success. Our main competitor is a biologic product, Benlysta(R), the only FDA approved drug specifically for SLE patients. Benlysta targets and blocks B Lymphocyte Stimulator, which promotes autoimmunity by permitting autoimmune B cells to live longer. However, Benlysta has not been evaluated in patients with severe active lupus nephritis or severe active central nervous system lupus and is not recommended for these patients.  TAM-01 intends to take advantage of these limitations and to provide an effective therapy for these patients.  Clinical success, however, is uncertain and our failure to compete effectively could have a material adverse effect on our business.

Oncology clinical development is very competitive with one recently published study stating that there were more than 1,500 clinical trials underway in the oncology space during the study period, far more than any other therapeutic area.  In this environment any newly approved oncology product must show significant benefit over standard of care at time of approval, a significant barrier to entry.

Neurodegenerative diseases bring tremendous economic impact to society and burden of disease to patients and their families.  There is a very high level of unmet need in this area and with the importance of these diseases to societies many large pharmaceutical manufacturers and biotechs are actively developing therapeutics to target these diseases.  This creates a competitive environment and for our compounds to be successful will require us to show benefit vs. current and future therapeutics and will require us to compete against companies with access to much greater resources and expertise.

Intellectual Properties and Licenses

We strive to protect and enhance the proprietary technologies that we believe are important to our business and seek to obtain and maintain patents for any patentable aspects of our productscannabis and any other inventionsrelated drug paraphernalia are criminal acts under the Controlled Substances Act. Although the Company plans to only engage in cannabis-related activities that are importantcompliant with applicable state and local laws, strict compliance with state and local laws with respect to cannabis may not absolve us of liability or enforcement actions under U.S. federal law, nor may it provide a defense to any proceeding that may be brought against the developmentCompany.

California

Our initial cannabis operations are planned to commence in California, subject to satisfaction of our business. Our success depends in part on our ability to obtainclosing and maintain our patent portfolio and other proprietary protection for commercially important technology, inventions and know-how related to our business, to defend and enforce our patents, to maintain our licenses to use intellectual property owned by third parties, to preservepost-closing conditions including the confidentiality of our trade secrets and to operate without infringing the valid and enforceable patents and other proprietary rights of third parties. We also rely on continuing technological innovation and in-licensing opportunities to develop, strengthen, and maintain our proprietary position in our targeted therapeutic.

On August 17, 2014, Mount Tam entered into the Buck Institute License Agreement. This agreement establishes a joint research effort led by Buck Institute to identify and develop compounds from two specific chemical chemotypes identified therein. We provide certain funding for Buck Institute's research efforts performed under the Buck Institute License Agreement. Under the termsreceipt of the Buck Institute License Agreement, Buck Institute assigned exclusive, worldwide rights to develop, manufacture and commercialize pharmaceutical products that incorporate a compound from one of two chemical compounds, identified therein, and exclusive rights to practice the drug discovery platform technology as necessary to research, develop and commercialize such pharmaceutical products. Mount Tam retains rights to inventions made by its employees, and Buck Institute will assign to Mount Tam all inventions made under the Buck Institute License Agreement jointly by its employees and Buck Institute personnel, provided that Mount Tam has complied with its funding obligations set forth in the Buck Institute License Agreement. On March 19, 2015 Mount Tam entered into an amendment to the Buck Institute License Agreement to extend the deadline of funding milestones and its reimbursement obligations for expenses that Buck Institute accrued relating to the patents under the Buck Institute License Agreement. On April 1, 2015, Mount Tam satisfied this revised funding milestone deadline with Buck Institute.

During the second quarter of 2016 the Company entered into negotiations with the Buck Institute to resolve certain outstanding financial concerns, and to broaden the Research Collaboration and License Agreement beyond the area of autoimmune disease. On July 18, 2016, the Company entered into an amendment (the "Amendment") to the Research Collaboration and License Agreement (the "License Agreement") between the Company and The Buck Institute.

By way of background, and as previously disclosed in the Company's public filings, the Company previously entered into a Research Collaboration and License Agreement (the "Buck Institute License Agreement") with the Buck Institute, which establishes a joint research effort led by Buck Institute to identify and develop compounds from two specific chemical chemotypes identified therein. The Company agreed to provide certain funding for Buck Institute's research efforts performed under the Buck Institute License Agreement. Under the terms of the Buck Institute License Agreement, Buck Institute assigned exclusive, worldwide rights to develop, manufacture and commercialize pharmaceutical products that incorporate a compound from one of two chemical compounds, identified therein, and exclusive rights to practice the drug discovery platform technology as necessary to research, develop and commercialize such pharmaceutical products. (Additional information about the Buck Institute License Agreement, together with prior amendments thereto, may be found in the Company's public filings).

Pursuant to this Amendment, the Research Collaboration Term of the License Agreement is tolled until the Company can achieve a Qualified Financing (defined as any financing occurring after the date of the Amendment which results in gross proceeds to the Company of at least $2,000,000). Once a Qualified Financing has been achieved, the research collaboration efforts will resume, and will continue for a period of twenty-one months (the "Extended Research Collaboration Term"). The Company and The Buck Institute agreed to work together to determine a new research plan, specifying the research and development activities of both parties during the Extended Research Collaboration Term.

Moreover, in the Amendment the parties agreed that the field of use covered by the License Agreement would be expanded, with the new definition being "the treatment, diagnosis or prevention of any and all conditions or diseases including, without limitation, systemic lupus erythematous and multiple sclerosis for human and/or veterinary use." (Under the original License Agreement, the Company's field of use had been restricted to autoimmune disorders.)

Within the licensed library is TAM-01. TAM-01's composition of matter is patented in the US, having an expiration date of December 2032. TAM-01's composition of matter patent has been allowed in Japan, expected to provide coverage through 2032 or beyond. Our licensed TAM-01 European (EU) patent claiming TAM-01 as well as compositions, uses, and processes for preparing TAM01, was granted in February 2018 and validated in 18 EU nations in the second quarter of 2018. We continue, as part of our ongoing research and development efforts, to strive to defend and to strengthen the intellectual property position of our key assets.

As consideration for the assignments and licenses, we issued Buck Institute 1,200,000(post-merger) (450,000 pre-merger) shares of our common stock and Mount Tam is obligated to pay to Buck Institute milestone payments on development of its proprietary products claimed by patents assigned or licensed to it by Buck Institute. Mount Tam also is obligated to pay low single digit royalties, including annual minimum royalties, on sales of such products. Should Mount Tam grant licenses or sublicenses to those patents to third parties, Mount Tam is obligated to share a percentage or resulting revenue with Buck Institute. Mount Tam's royalty payment obligations are reduced if currently pending patent applications become invalid or if Mount Tam has to pay third parties to obtain certain licenses for the company to manufacture, use, sell or import its products produced pursuant to the Buck Institute License Agreement. Payment obligations terminate on expiration or annulment of the last patent covered by the Buck Institute License Agreement.

The Buck Institute License Agreement will terminate upon the expiration of our payment obligations thereunder. Mount Tam can terminate the licenses to any or all licensed patents upon specified advance notice to Buck Institute. Buck Institute may terminate the license provisions of the agreement only for cause. Termination of the Buck Institute License Agreement does not terminate Mount Tam's rights in patents assigned to it.

In addition to our TAM-01 license, Mount Tam continues to work diligently to expand its intellectual property portfolio.  As part of these efforts, an international (PCT) patent application directed to TAM-03, as well as compositions, uses and processes for preparing TAM-03, and claiming a February 2017 priority date, was filed in February 2018 (published in August 2018).

Governmental Regulations

To date, we have conducted and will continue to conduct our preclinical research through contract research organizations ("CROs"), through our partnership with the Buck Institute and through other academic collaborations. We do not at this time have the ability to independently conduct clinical trials for our product candidates, and we expect to continue to rely on CROs, medical institutions and academic collaborators to perform this function for both preclinical and clinical activities. Our reliance on these third parties for pre-clinic and clinical development activities reduces our control over these activities. Although we have, in the ordinary course of business, entered into agreements with these third parties, we continue to be responsible for confirming that all of our preclinical and clinical trials are conducted in accordance with approved investigational plans and protocols. Moreover, FDA requires us to comply with regulations and standards, commonly referred to as good clinical practices or cGCPs, for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible and accurate and that the trial participants are adequately protected. Our reliance on third parties does not relieve us of these responsibilities and requirements. To date, we believe that our CROs, the Buck Institute and academic collaborators have performed well.

The process of complying with FDA guidelines and obtaining approvals from FDA of applications to market drugs and products is costly, time consuming and subject to unanticipated delays. There is no assurance that we will be able to obtain FDA approval for any of our products.

Discovery and Development Activities

To gainrequired regulatory approval of our acquisition of Treehouse and its two licenses. In September 2015, the California legislature passed three bills collectively known as the Medical Cannabis Regulation and Safety Act (“MCRSA”). The MCRSA established a licensing and regulatory framework for medical marijuana businesses in California. In 2016, voters in California passed Proposition 64, the Adult Use of Marijuana Act (“AUMA”) creating an adult use marijuana program for adults 21 years of age or older. Senate Bill No. 94, known as Medicinal and Adult Use Cannabis Regulation and Safety Act (“MAUCRSA”) in June 2017, essentially combining the AUMA with the MCRSA to provide a single set of regulations to govern a medical and adult use licensing. MAUCRSA went into effect on January 1, 2018.

In order to legally operate a medicinal or adult use cannabis business in California, the operator must have both a local and state license. This requires license holders to operate in cities with cannabis licensing programs. Municipalities in California are allowed to determine the number of licenses they will issue to cannabis operators or can choose to ban cannabis businesses outright.

There are three principal license categories in California: (1) cultivation, (2) processing and (3) retailer. Each of the two Treehouse licenses are retailer licenses, which permit the sale of cannabis and cannabis products we must demonstrate, through experiments, preclinical studiesto both medical patients and clinical trials that our drug product candidate meetsadult use customers. Only certified physicians may provide medicinal marijuana recommendations. An adult use retailer license permits the safetysale of cannabis and efficacy standards established by FDAcannabis products to any adult 21 years of age or older.

We intend to follow all regulatory requirements regarding the reporting of inventory movement and other international regulatory authorities. In addition, we must demonstrate that all development-related laboratory, clinical and manufacturing practices comply with regulations of FDA, other international regulators and where applicable, local regulators.

Regulations establish standards for various actions including: drug substances and materials; drug manufacturing operations and facilities; and analytical laboratories and medical development laboratory processes and environments. In each instance, these standards are in connection with research, development, testing, manufacture, quality control, labeling, storage, record keeping, approval, advertising and promotion, and distribution of product candidates, on a product-by-product basis.

Preclinical Studies and Clinical Trials

Development testing generally begins with laboratory testing and experiments,sale, as well as research studies using animal models to obtain preliminary information on a product's efficacyall other data reporting and to identify potential safety issues. The results of these studies are compiled along with other information in an IND application, which is filed with FDA. After resolving any questions raisedrecord retention requirements mandated by FDA, which may involve additional testing and animal studies, clinical trials may begin. Regulatory agencies in other countries generally require a Clinical Trial Application to be submitted and approved before each trial can commence in each country.California.

Clinical trials normally are conducted in three sequential phases and may take many years to complete. Phase 1 consists of testing the drug product in a small number of humans, often healthy volunteers, to determine preliminary safety and a tolerable dose range. Phase 2 usually involves studies in a limited patient population to evaluate the effectiveness of the drug product in humans having the disease or medical condition for which the product is indicated, determine dosage tolerance and optimal dosage and identify possible common adverse effects and safety risks. Phase 3 consists of additional controlled testing at multiple clinical sites to establish clinical safety and effectiveness in an expanded patient population of geographically dispersed test sites to evaluate the overall benefit-risk relationship for administering the product and to provide an adequate basis for product labeling. Phase 4 clinical trials may be conducted after approval to gain additional experience from the treatment of patients in the intended therapeutic indication.

Employees

The conduct of clinical trials is subject to stringent medical and regulatory requirements. The time and expense required to establish clinical sites, provide training and materials, establish communications channels and monitor a trial over a long period of time is substantial. The conduct of clinical trials at institutions located around the world is subject to foreign regulatory requirements governing human clinical trials, which vary widely from country to country. Delays or terminations of clinical trials could result from a number of factors, including stringent enrollment criteria, slow rate of enrollment, size of patient population, having to compete with other clinical trials for eligible patients, geographical considerations and others. Clinical trials are monitored by the regulatory agencies as well as medical advisory and standards boards, which could determine at any time to reevaluate, alter, suspend, or terminate a trial based upon accumulated data, including data concerning the occurrence of adverse health events during or related to the treatment of patients enrolled in the trial, and the regulator's or monitor's risk/benefit assessment with respect to patients enrolled in the trial. If they occur, such delays or suspensions could have a material impact on our development programs.

Regulatory Review

The results of preclinical and clinical trials are submitted to FDA in a New Drug Application ("NDA"), with comparable filings submitted to other international regulators. After the initial submission, FDA has a period of time in which it must determine if the NDA is complete. After an NDA is submitted, although the statutory period provided for FDA's review is less than one year, dealing with questions or concerns of the agency and, taking into account the statutory timelines governing such communications, may result in review periods that can take several years. If an NDA is accepted for filing, following FDA's review, FDA may grant marketing approval, request additional information, or deny the application if it determines that the application does not provide an adequate basis for approval. If FDA grants approval, the approval may be conditioned upon the conduct of post-marketing clinical trials or other studies to confirm the product's safety and efficacy for its intended use. Until FDA has issued its approval, no marketing activities can be conducted in the United States. Similar regulations apply in other countries. There can be no assurance that any of the Company's drug candidates will receive FDA approval or the approval of regulators in other countries.

Fast Track and Breakthrough Designations

FDA has various programs, including fast track and breakthrough therapy designations, which are intended

to expedite the process for reviewing drugs. Even if a drug qualifies for one or more of these programs, FDA may later decide that the drug no longer meets the conditions for qualification. Generally, drugs that are eligible for these programs are those for serious or life-threatening conditions, those with the potential to address unmet medical needs, and those that offer meaningful benefits over existing treatments.

Fast track designation is intended to facilitate the development and expedite the review of drugs to treat serious conditions and fill an unmet medical need. Designation may be granted on the basis of preclinical data. A sponsor of a drug that receives fast track designation will typically have more frequent interactions with FDA during drug development. In addition, products that have been designated as fast track can obtain rolling review.

Breakthrough therapy designation is intended to expedite the development and review of drugs for serious or life-threatening conditions. The criteria for breakthrough therapy designation require preliminary clinical evidence that demonstrates the drug may have substantial improvement on at least one clinically significant endpoint over available therapy. A breakthrough therapy designation conveys all of the fast track program features, more intensive FDA guidance on an efficient drug development program, an organizational commitment involving senior managers, and eligibility for rolling review and priority review.

A key difference between fast track designation and breakthrough designation is what needs to be demonstrated to qualify for the programs. A breakthrough therapy designation is for a drug that treats a serious or life-threatening condition and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement on a clinically significant endpoint(s) over available therapies. In contrast, a fast track designation is for a drug that treats a serious or life-threatening condition, and nonclinical or clinical data demonstrate the potential to address unmet medical needs for the serious condition.

Where appropriate, the Company intends to seek fast track designation for TAM-01 and TAM-03. There can be no assurance that FDA will grant fast track designation. Even if such designation is provided, it may not result in a faster development or review time. Moreover, fast track designations do not increase the odds of approval. A fast track designation may be rescinded at any time if the drug candidate does not continue to meet the qualifications for these programs.

Manufacturing Standards

FDA and other international regulators establish standards and routinely inspect facilities and equipment, analytical and quality laboratories and processes used in the manufacturing and monitoring of products. Prior to granting approval of a drug product, FDA will conduct a pre-approval inspection of the manufacturing facilities, and the facilities of suppliers, to determine that the drug product is manufactured in accordance with cGMP and product specifications. Following approval, FDA will conduct periodic inspections. If, in connection with a facility inspection, FDA determines that a manufacturer does not comply with cGMP regulations and product specifications, FDA will issue an inspection report citing the potential violations and may seek a range of remedies, from administrative sanctions, including the suspension of our manufacturing operations, to seeking civil or criminal penalties.

International Approvals

Even if we were to succeed in gaining regulatory approval to market our products in the United States, we will still need to apply for approval with other international regulators if we want to sell outside the United States. Regulatory requirements and approval processes are similar in approach to that of the United States. With certain exceptions, although the approval of FDA carries considerable weight, international regulators are not bound by the findings of FDA and there is a risk that foreign regulators will not accept a clinical trial design or may require additional data or other information not requested by FDA.

Post-approval Regulations

Following the grant of marketing approval, FDA regulates the marketing and promotion of drug products. Promotional claims are generally limited to the information provided in the product package insert for each drug product, which is negotiated with FDA during the NDA review process. In addition, FDA enforces regulations designed to guard against conflicts of interest, misleading advertising and improper compensation of prescribing physicians. FDA will review, among other things, direct-to-consumer advertising, prescriber-directed advertising and

promotional materials, sales representative communications to healthcare professionals, promotional programming and promotional activities on the Internet. FDA will also monitor scientific and educational activities. If FDA determines that a company has promoted a product for an unapproved use ("off-label"), or engaged in other violations, it may issue a regulatory letter and may require corrective advertising or other corrective communications to healthcare professionals. Enforcement actions may also potentially include product seizures, injunctions and civil or criminal penalties. The consequences of such an action and the related adverse publicity could have a material adverse effect on a developer's ability to market its drug and its business as a whole.

Following approval, FDA and other international regulators will continue to monitor data to assess the safety and efficacy of an approved drug. A post-approval discovery of previously unknown problems or failure to comply with the applicable regulatory requirements may result in restrictions on the marketing of a product or a recall or withdrawal of the product from the market, as well as possible civil or criminal sanctions. Similar oversight is provided by regulators in jurisdictions outside the US.

None of our products under development has been approved for marketing in the United States or elsewhere. We may not be able to obtain regulatory approval for any of our products under development. If we do not obtain the requisite governmental approvals or if we fail to obtain approvals of the scope we request, we or our licensees or strategic alliance or marketing partners may be delayed or precluded entirely from marketing our products, or the commercial use of our products may be limited. Such events would have a material adverse effect on our business, financial condition and results of operations.

Other Healthcare Laws and Regulations

If we obtain regulatory approval for any of our current or future product candidates, we may also be subject to healthcare regulation and enforcement by the federal government and the states and foreign governments in which we conduct our business. These laws may impact, among other things, our proposed sales, marketing and education programs. In addition, we may be subject to patient privacy regulation by both the federal government and the states in which we conduct our business. The laws that may affect our ability to operate include:

·the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or service for which payment may be made under federal healthcare programs such as the Medicare and Medicaid programs; 

·federal false claims laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third-party payers that are false or fraudulent; 

·federal criminal laws that prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters; 

·the federal Physician Payment Sunshine Act, which requires certain manufacturers of drugs, devices, biologics and medical supplies to report annually to the Centers for Medicare & Medicaid Services information related to payments and other transfers of value to physicians, other healthcare providers, and teaching hospitals, and ownership and investment interests held by physicians and other healthcare providers and their immediate family members; 

Health Insurance Portability and Accountability Act of 1996, as amended by Health Information Technology for Economic and Clinical Health Act of 2009, which governs the conduct of certain electronic healthcare transactions and protects the security and privacy of protected health information; and

·state and foreign law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any third-party payer, including commercial insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry's  

voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.

 If our operations are found to be in violation of any of the laws described above or any other governmental laws and regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, the curtailment or restructuring of our operations, the exclusion from participation in federal and state healthcare programs and imprisonment, any of which could adversely affect our ability to operate our business and impact our financial results.

Employees

As of the date of this Report, we have two employees. In addition, we use advisors and consultants for research and development, clinical, regulatory, legal and administrative activities. We plan to hire additional staff as we expand research, production, business development, and sales and marketing programs. None ofone employee, our employees are represented by a labor union.Chief Executive Officer.

ITEM 1A. Risk Factors.RISK FACTORS.

Before deciding to purchase, hold or sellInvesting in our common stock youinvolves a high degree of risk. Investors should carefully consider the risks described belowfollowing Risk Factors before deciding whether to invest in addition to the other information contained in this Annual Report and in our other filings with the SEC, including subsequent reports on Forms 10-Q and 8-K. TheCompany. Additional risks and uncertainties not presently known to us, or that we currently deem immaterial, may also affectimpair our business.financial condition. If any of these known or unknown risks or uncertainties actually occurs with material adverse effects on the Company,events discussed in the Risk Factors below occur, our business, consolidated financial condition, results of operations and/or liquidityprospects could be seriously harmed.materially and adversely affected. In that event,such case, the market pricevalue and marketability of our common stock could decline.

Risks Related to our Planned Operations in the Cannabis Industry

We currently have a SPA to acquire two cannabis licenses, and the closing of this transaction and the subsequent use thereof are subject to contractual and regulatory contingencies over which we have little to no control.

As of March 10, 2022, the Company’s acquisition of a majority of the ownership interest of Treehouse has not closed. We will likely decline,need to acquire ownership of Treehouse in order to commence our initial cannabis retail operations in California. Treehouse’s main assets consist of two cannabis licenses. The initial purchase agreement, which contemplates the acquisition of an 80% ownership interest in Treehouse, requires that we pay $200,000. We will also need to pay an additional $200,000 to obtain the remaining 20% Treehouse ownership under a subsequent purchase agreement if it is executed. Since we have sold the remaining Ecoark common stock we previously held, we will need to raise additional capital to complete these transactions. We have also committed to substantial financial obligations under our JVA with 7Seeds and Firebreak in order to capitalize on the Treehouse acquisition through Elysian Stores using the Cannablue Marks, which will be dependent on the acquisition closing and receiving the regulatory approval. Also by virtue of the JVA, we will be highly dependent on 7Seeds to establish and expand our market presence and on Firebreak for branding, and the JVA precludes us from selling cannabis products online using the CannaBlue Marks. Further, the purchase of the licenses under the Treehouse SPA is conditioned upon Elysian and Treehouse obtaining the required regulatory approval for the transfer of the licenses from each of the California Department of Cannabis Control and the City of Oakland, which we may be unable to obtain. There can therefore be no assurance that the transaction will close or that we will be successful on capitalizing on the licenses if we do obtain them, in which case our planned cannabis operations and prospects will be materially adversely affected and you maycould lose all or part of your investment.

Risks Related to Our Business

Our success depends heavily on the successful development, regulatory approval and commercialization of TAM-01, our lead product candidate, and of TAM-03, our follow-on compound (“Our Candidates”).

We do not have any products that have been granted regulatory approval. We cannot commercialize our compoundslack an operating history in the United States withoutcommercial cannabis space, and our proposed business is subject to a number of significant risks and uncertainties which affect its future viability.

As of March 10, 2022, we have invested and agreed to invest amounts exceeding the current value of our assets towards the development of our future cannabis business. That business, Elysian, has been formed and we have entered into a SPA to acquire two cannabis licenses in California and a separate JVA to use those licenses, but has not commenced material operations. If we are able to proceed, we must acquire a lease or purchase land for our first obtaining regulatory approval for these products from FDA, nor can we commercializecannabis dispensary in California, as well as hire qualified personnel and implement information technology and infrastructure to track inventory and sales and develop online sales capabilities. We also expect to incur significant expenditures to obtain intellectual property rights and enter into other arrangements to develop our candidates outside of the United States without obtaining regulatory approval from comparable foreign regulatory authorities. Clinical trialsbrand, stores and marketing. These plans will require many years to complete and the FDA review processadditional capital that follows completion of clinical trials typically takes 10 months or more, and approval is never guaranteed. Aswill have a result, our near-term prospects, including our ability to finance our operations and generate revenue, are substantially dependentdilutive effect on our ability to successfully complete clinical trialsshareholders and to subsequently obtain regulatory approval for, and if approved,

to successfully commercialize our candidates in a timely manner.

Obtaining regulatory approval for marketing of any product candidate in one country does not ensure we will be able to obtain regulatory approval in other countries, while a failure or delay in obtaining regulatory approval in one country maycould have a negativedepressive effect on our stock price. Among the regulatory process in other countries.risks and uncertainties are:

EvenIf any if we werethese risks come to successfully obtain approval for any product candidate from FDA and comparable regulatory authorities outside the United States, any approval might contain significant limitations related to use restrictionsfruition, or may be subject to burdensome and costly post-approval study or risk management requirements. Ifif we are unable to obtain regulatory approval forovercome the challenges they may pose, our product candidate in one or more jurisdictions, or if any approval contains significant limitations,ability to generate revenue and as a result our financial condition would be materially adversely affected.

We require additional financing to commence and expand operations as intended, and we may notface difficulties acquiring financing on terms acceptable to us or at all.

We will need additional capital to establish and grow our planned cannabis operations and will need to seek further financing to do so. To this end, as of March 1, 2022 we have sold the remaining Ecoark common stock we held with the intention of using some or all of the proceeds to complete the Treehouse SPA, which when combined with our commitments under the JVA and advisors’ compensation for Norr, necessitates us locating additional capital to fund our current and planned operations. If we fail to raise additional capital as and when needed, our ability to implement our business could be ablecompromised. To date, our efforts to enter the cannabis industry have been limited to executing an agreement to acquire two cannabis licenses which if closed would enable us to sell cannabis products in California. However, we require additional capital to fund the acquisition, which will be for a total purchase price of $400,000, and for working capital purposes, including operational expenses such as obtaining licenses, compensating employees and service providers to assist in sales, compliance and other matters, and capital expenditures and infrastructure including obtaining rights and inventory in cannabis products to sell. Management estimates needing at least $10 million to fund our planned expenditures and operations over the next 12 months.

The terms of securities we issue in future capital raising transactions may be more favorable to new investors, and may include liquidation preferences, superior voting rights or the issuance of other derivative securities, which could have a further dilutive effect on or subordinate the rights of our current investors. Any additional capital raised through the sale of equity securities will likely dilute the ownership percentage of our shareholders and could have a depressive effect on our stock price. Additionally, any debt securities we issue would likely create a liquidation preference superior that of our current investors and, if convertible into shares of common stock, would also pose the risk of dilution. If we fail to obtain sufficient fundingthe necessary financing when needed, on favorable terms or generate sufficient revenue to continue our operations. Also, any regulatory approval of our product candidates, once obtained, may be withdrawn by the regulatory authority. Furthermore, even if we obtain regulatory approval, commercial success will depend on how successfully we are able to address a number of challenges, including the following:

•development of our own commercial organization and/or establishment of commercial collaborations with partners;  

•establishment of commercially viable pricing and obtaining approval for adequate reimbursement from third-party and government payors;  

•the ability of our third-party manufacturers to manufacture quantities of our candidates using commercially viable processes at a scale sufficient to meet anticipated demand and that are compliant with applicable regulations; 

•our success in educating physicians, other health care professionals and patients about the benefits, administration and use of our candidates;  

•the availability, actual advantages, perceived advantages, relative cost, relative safety and relative efficacy of alternative and competing treatments; and  

•the effectiveness of our own or our potential commercial collaborators' marketing, sales and distribution strategy and operations. 

Many of these factors are beyond our control. If we or any commercialization partners are unable to successfully commercialize our candidates or any future product candidate, we may not be able to earn sufficient revenues to continue our business.

The regulatory approval processes of FDA and comparable authorities outside the United States are lengthy, time-consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for one or more of our product candidates, our business will be substantially harmed.

The time required to complete clinical trials and to obtain approval by FDA and comparable authorities outside the United States is unpredictable and typically takes many years. In addition, approval policies, regulations, or the type and amount of clinical data necessary to gain approval may change during the course of a product candidate's development and may vary among jurisdictions. We have not obtained regulatory approval for our candidates, and it is possible that our existing candidates, or any product candidates we may seek to develop in the future, will never obtain regulatory approval.

Our product candidates could fail to receive regulatory approval for many reasons, including the following:

•FDA or comparable foreign regulatory authorities may disagree with the design, scope or implementation of any clinical trials that we propose to conduct or require us to conduct additional clinical trials;  

•all, we may be unableforced to demonstrate todiscontinue operations, and your investment could become worthless. Further, if the satisfaction of FDAsecurities we issue are dilutive or comparable foreign regulatory authorities thatotherwise negatively impact existing investors’ rights, our product candidate is both safebusiness and effective for its proposed indication;  prospects, and/or your investment in us could be materially harmed.

•we may be unable to demonstrate that our product candidate's clinical and other benefits outweigh its safety risks;  

•FDA or comparable regulatory authorities outside the United States may disagree with our interpretation of data from preclinical studies or clinical trials;  

•the data collected from clinical trials of our product candidates may not be sufficient to support the submission of an NDA or other submission or to obtain regulatory approval in the United States or elsewhere;  

•FDA or comparable regulatory authorities outside the United States may fail to approve the manufacturing processes or facilities of third party manufacturers with which we contract for clinical and commercial supplies; and  

•the approval policies or regulations of FDA or comparable regulatory authorities outside the United States may change significantlyWe face intense competition in a manner rendering our clinical data insufficient for approval. 

Failing to obtain regulatory approval to market one orrapidly developing industry by larger, vertically integrated competitors with more of our product candidates would harm our business, results of operationsexperience and prospects significantly.

In addition, even if we were to obtain approval, such regulatory approval may be for more limited indicationsfinancial resources than we request, may impact the price we intend to charge for our products, may be contingent on the performance of costly post-marketing clinical trials, have, as well as numerous smaller and/or may approve a product candidate with a label that does not include the labeling claims necessary or desirable for the successful commercialization of our product candidates. Any of the foregoing scenarios could harm the commercial prospects for our product candidates.unlicensed market participants.

We have not previously submitted an NDA or any similar drug approval filing to FDA or any comparable authority outside the United States for our product candidates, and we cannot be certain that our product candidate will be successful in clinical trials or receive regulatory approval. Further, our product candidates may not receive regulatory approval even if they are successful in clinical trials. If we do not receive regulatory approvals for our product candidates, we may not be able to continue our operations. Even if we successfully obtain regulatory approvals to market our product candidates in one or more jurisdictions, our revenue will be dependent, to a significant extent, upon the size of the markets in the jurisdictions for which we gain regulatory approval.

Even if our candidates, and any future product candidates, receive regulatory approval, they may fail to achieve the degree of market acceptance by physicians, pharmacies, hospital administrators, patients, caregivers, healthcare payors and others in the medical community necessary for commercial success.

Existing therapies for SLE have well-established market positions and familiarity with physicians, payers and patients. If we are unable to achieve significant differentiation for TAM-01 from existing and widely accepted therapies for SLE, our opportunity for TAM-01 to be commercialized successfully, if approved, would be adversely affected.  Additionally, the markets for novel cancer therapeutics are extremely competitive with both regulators and payors requiring a clear demonstration of benefit vs. standard-of-care for approval and subsequent reimbursement.  In this environment, even if one or more of our candidates receive regulatory approval they may not be commercially successful.

If TAM-01, TAM-03 or any of our future product candidates receive regulatory approval, they may nonetheless fail to gain sufficient market acceptance by physicians, pharmacies, hospital administrators, patients, caregivers, payers and others in the medical community. The degree of market acceptance of our product candidate, if approved for commercial sale, will depend on a number of factors, including the following:

•convenience and ease of administration of the product candidate compared to alternative treatments;  

•the prevalence and severity of any side effects;  

•their efficacy and potential advantages compared to alternative treatments;  

•the willingness of physicians and other health care providers to change their current treatment practices;  

•the willingness of the target patient population to try new therapies and of physicians to prescribe new therapies;  

•the strength of marketing and distribution support; and  

•the price we charge for our product candidate. 

Neither TAM-01 nor TAM-03 have ever been manufactured on a commercial scale, and there are risks associated with scaling up manufacturing to commercial scale.

We have never manufactured our product candidates on a commercial scale, and there are risks associated with scaling up manufacturing to commercial scale including, among others, cost overruns, potential problems with process scale-up, process reproducibility, stability issues, lot consistency and timely availability of raw materials. Even if we could otherwise obtain regulatory approval for our candidates or other future product candidates there is no assurance that our manufacturer, that we have not yet engaged, will be able to manufacture the approved product to specifications acceptable to FDA or other regulatory authorities, to produce it in sufficient quantities to meet the requirements for the potential launch of the product or to meet potential future demand.

If our suppliers are unable to produce sufficient quantities of any approved product for commercialization, our commercialization efforts would be impaired, which would have an adverse effect on our business, financial condition, results of operations and growth prospects.

We may not be successful in our efforts to build a pipeline of drug candidates.

A key element of our strategy is to use and expand our proprietary drug discovery platform to build a pipeline of drug candidates to address different targets, and progress those drug candidates through clinical development for the treatment of a variety of different types of diseases. Although our research efforts to date have resulted in identification of a series of targets, we may not be able to develop drug candidates that are safe and effective inhibitors or promoters of all or any of these targets. Even if we are successful in building a product pipeline, the potential drug candidates that we identify may not be suitable for clinical development for a number of reasons, including causing harmful side effects or demonstrating other characteristics that indicate a low likelihood of receiving marketing approval or achieving market acceptance. If our methods of identifying potential drug candidates fail to produce a pipeline of potentially viable drug candidates, then our success as a business will be dependent on the success of fewer potential drug candidates, which introduces risks to our business model and potential limitations to any success we may achieve.

We face substantialintense competition from other cannabis companies, many of which may result in others discovering, developing or commercializing products before orhave longer operating histories and more successfully than we do.

The development and commercialization of new specialty pharmaceutical products is highly competitive. We face competition with respect to TAM-01 and TAM-03, and will face competition with respect to any product candidates that we may seek to develop or commercialize in the future, from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide. There are many large pharmaceutical and biotechnology companies that are developing or currently market and sell products to our target patient groups. Potential competitors also include academic institutions, government agencies and other public and private research organizations that conduct research, seek patent protection and establish collaborative arrangements for research, development, manufacturing and commercialization.

Many of our competitors, including a number of large pharmaceutical companies that compete directly with us, have significantly greater financial resources and expertise in researchmarketing experience than us, and/or have vertically integrated seed-to-sale cannabis businesses. Increased competition by larger and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products than we do. There may also be companies unknown to us that are engaged in the development of products that are potentially competitive with those that we are developing. Mergers and acquisitions in the pharmaceutical, biotechnology and diagnostic industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller or early stage companies may also prove to be significantbetter financed competitors particularly through collaborative arrangements with large and established companies.

We currently have no sales representatives or distribution personnel and no marketing capabilities. If we are unable to develop a sales and marketing and distribution capability, we will not be successful in commercializing current or future product candidates.

We have not yet built out an infrastructure to sell, market or distribute therapeutic products. If TAM-01, TAM-03 or other future product candidates are approved, we intend to commercialize them, whether on our own or as part of a strategic partnership, with our own specialty sales force in the United States and with commercial partners globally.

There are risks involved with both establishing our own sales and marketing and distribution capabilities and entering into arrangements with third parties to perform these services. For example, recruiting and training a sales force is expensive and time-consuming and could delay any product launch. If the commercial launch of a product candidate for which we recruit a sales force and establish marketing capabilities is delayed or does not occur for any reason, we would have prematurely or unnecessarily incurred these commercialization expenses. This may be costly, and our investment would be lost if we cannot retain or reposition our sales and marketing personnel.

We may be unable to identify appropriate commercial partners to distribute and market our products outside the United States or to negotiate terms with such commercial partners that are favorable or acceptable to us. Also, we may be unable to maintain those relationships. The inability to identify, successfully negotiate with, and maintain relationships with, commercial partners for distribution outside the United States could limit and/or delay our ability to commercialize our products outside the United States.

If we obtain approval to commercialize any of our product candidates outside the United States, we will be subject to additional risks.

If we obtain approval to commercialize any approved products outside of the United States, a variety of risks associated with international operations could materially and adversely affect our business, including:

•different regulatory requirements for drug approvals in countries outside the United States;  

•reduced protection for intellectual property rights;  

•unexpected changes in tariffs, trade barriers and regulatory requirements;  

•economic weakness, including inflation or political instability in particular foreign economies and markets;  

•compliance with tax, employment, immigration and labor laws for employees living or traveling abroad;non-United States taxes, including withholding of payroll taxes; 

•foreign currency fluctuations, which could result in increased operating expenses and reduced revenue and other obligations incident to doing business in another country;  

•workforce uncertainty in countries where labor unrest is more common than in the United States;  

•production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and  

•business interruptions resulting from geopolitical actions, including war and terrorism, or natural disasters including earthquakes, typhoons, floods and fires. 

Even if we receive regulatory approval for TAM-01, TAM-03 or future product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense, and we may be subject to penalties if we fail to comply with regulatory requirements.

Any regulatory approvals that we may receive for our product candidates will contain approved indicated uses, and we will be required to market any approved products in accordance with the indicated uses and our approved

labeling. In addition, any regulatory approvals may contain conditions for approval or requirements for potentially costly post-marketing testing and surveillance to monitor the safety and efficacy of the product candidate. In addition, if FDA or a comparable regulatory authority outside the United States approves our product candidate, the manufacturing processes, labeling, packaging, distribution, adverse event reporting, storage, advertising, promotion, import, export and recordkeeping for the product will be subject to extensive and ongoing regulatory requirements. These requirements include submissions of safety and other post-marketing information and reports, registration, as well as continued compliance with current good manufacturing practices, or cGMPs, Quality System Regulation, or QSR, requirements and current good clinical practices for any clinical trials that we conduct post-approval. Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with our third-party manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may result in, among other things:

•restrictions on the marketing or manufacturing of the product, withdrawal of the product from the market, or voluntary or mandatory product recalls;  

•fines, warning or untitled letters or holds on clinical trials;  

•refusal by FDA to approve pending applications or supplements to approved applications filed, or suspension or revocation of product approvals;  

•product seizure or detention, or refusal to permit the import or export of products; and  

•injunctions, the imposition of civil penalties or criminal prosecution. 

We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad. Any government investigation of alleged violations of law could require us to expend significant time and resources in response and could generate negative publicity. If we are not able to maintain regulatory compliance or if we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, regulatory sanctions may be applied or we may lose any marketing approval that we may have obtained, and we may not achieve or sustain profitability, which would adversely affect our business, prospects, financial condition and results of operations.

Our product candidates may cause serious adverse side effects or have other properties that could delay or prevent their regulatory approval, limit Because we are a new entrant in the commercial profilecannabis industry and our operations will initially be focused on retail cannabis sales, the competitive forces pose a greater risk to us. Additionally, because of an approved label or resultthe early stage of the industry, we face additional competition from new entrants. If the number of consumers of cannabis in significant negative consequences following any marketing approval.

It is impossible to predict when or if our product candidatethe states in which we operate increases, the demand for products will prove safe enough to receive regulatory approval. Undesirable side effects could result in a more restrictive label or the delay or denial of regulatory approval by FDA or other comparable regulatory authority outside the United States for the affected product candidate. Additionally, if our product candidate receives marketing approval,increase and we or others later identify undesirable side effects caused by such product, aexpect that competition will become more intense, as current and future competitors begin to offer an increasing number of potentially significant negative consequences could result, including:

•we may be forced to suspend the marketing of such product;  

•regulatory authorities may withdraw their approvals of such product;  

•regulatory authorities may require additional warnings on the label that could diminish the usage or otherwise limit the commercial success of such products;  

•FDA or other regulatory bodies may issue safety alerts, "Dear Healthcare Provider" letters, press releases or other communications containing warnings about such product;  

•FDA may require the establishment or modification of Risk Evaluation Mitigation Strategies, or REMS, or a comparable regulatory authority outside the United States may require the establishment or modification of a similar strategy that may, for instance, restrict distribution of our productsdiversified products. To become and impose burdensome and costly implementation requirements on us;  

•we may be required to change the way the product is administered or conduct additional clinical trials;  

•we could be sued and held liable for harm caused to subjects or patients;  

•we may be subject to litigation or product liability claims; and  

•our reputation may suffer. 

Any of these events could prevent us from achieving or maintaining market acceptance of our product candidate, if approved.

Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop.

We face an inherent risk of product liability exposure related to any of our future product candidates. If we cannot successfully defend ourselves against claims that our product candidates or products caused injuries,remain competitive, we will incur substantial liabilities. Regardlessrequire a continued high level of merit or eventual outcome, liability claims may result in:

•decreased demand for anyinvestment in product candidates or products that we may develop;  

•injury to our reputationacquisition, branding, marketing and significant negative media attention;  

•significant costs to defend the related litigation;  

•substantial monetary awards to patients;  

•loss of revenue; and  

•the inability to commercialize any products that we may develop. 

Insurance coverage is increasingly expensive.sales efforts. We currently do not have any product liability or any other insurance, and may not be able to obtain and maintain insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that may arise.

We rely on third parties to conduct our preclinical studies and clinical trials. If these third parties do not successfully carry out their contractual duties or meet expected deadlines, we may not be able to obtain regulatory approval for our drug candidates and our business could be substantially harmed.

We depend upon independent investigators and contractors, such as CROs, universities and other academic institutions, such as Buck Institute, to conduct our preclinical studies and clinical trials. We rely upon, and plan to continue to rely upon, such third-party entities to execute our preclinical studies and clinical trials and to monitor and manage data produced by and relating to those studies and trials. However, we may not be able to in the future establish arrangements with CROs when needed or on terms that are acceptable to us, or at all, which could negatively affect our development efforts with respect to our drug candidates and materially harm our business, operations and prospects. As a result of the use of third-party contractors, we will have only limited control over certain aspects of their activities. Nevertheless, we are responsible for ensuring that each of our studies, including each of our clinical trials, is conducted in accordance with the applicable protocol, legal and regulatory requirements as well as scientific standards, and our reliance on any third-party entity will not relieve us of our regulatory responsibilities.

Based on our present expectations, we and our third-party contractors will be required to comply with current cGCP for all of our drug candidates in clinical development. Regulatory authorities enforce cGCP through periodic inspections of trial sponsors, clinical investigators and trial sites. If we or any of our contractors fail to comply with applicable cGCP, the clinical data generated in the applicable trial may be deemed unreliable and FDA or comparable foreign regulatory authorities may require us to perform additional clinical trials before approving a drug candidate for marketing, which we may not have sufficient cash or other resources to support and which would delay our ability to generate revenue from any sales of such drug candidate. Any agreements governing our relationships with outside contractors such as CROs or other contractors we may engage in the future, may provide those outside contractors

with certain rights to terminate a clinical trial under specified circumstances. If such an outside contractor terminates its relationship with us during the performance of a clinical trial, we would be forced to seek an engagement with a substitute contractor, which we may not be able to do on a timely basis or on commercially reasonable terms, if at all, and the applicable clinical trial would experience delays or may not be completed.

If our contractors do not successfully carry out their contractual duties or obligations or meet expected deadlines, if they need to be replaced or if the quality or accuracy of the data they obtain is compromised due to a failure to adhere to our clinical protocols, legal and regulatory requirements or for other reasons, our clinical trials may be extended, delayed or terminated and we may not be able to obtain regulatory approval for, or successfully commercialize, the affected drug candidates. In addition, we will be unable to control whether or not they devote sufficient time and resources to our preclinical and clinical programs. These outside contractors may not assign as great a priority to our programs or pursue them as diligently as we would if we were undertaking such programs ourselves. As a result, our operations and the commercial prospects for the effected drug candidates would be harmed, our costs could increase and our ability to generate revenues could be delayed. These contractors may also have relationships with other commercial entities, some of whom may compete with us. If our contractors assist our competitors to our detriment, our competitive position would be harmed.

Clinical drug development involves a lengthy and expensive process with uncertain outcomes, is very difficult to design and implement, and any of our clinical trials could produce unsuccessful results or fail at any stage in the process.

We are still in the preclinical stages of our development of TAM-01 and TAM-03 and hope to begin clinical trials in 2020. Clinical trials conducted on humans are expensive and can take many years to complete, and outcomes are inherently uncertain. Failure can occur at any time during the clinical trial process. Additionally, any positive results of preclinical studies and early clinical trials of a drug candidate may not be predictive of the results of later-stage clinical trials, such that drug candidate may reach later stages of clinical trials and fail to show the desired safety and efficacy traits despite having shown indications of those traits in preclinical studies and initial clinical trials. A number of companies in the pharmaceutical industry have suffered significant setbacks in advanced clinical trials due to lack of efficacy or adverse safety profiles, notwithstanding promising results in earlier phases of the trials. Therefore, the results of any ongoing or future clinical trials we conduct may not be successful.

We may experience delays in pursuing our planned clinical trials, and any planned clinical trials may not begin on time, may require redesign, may not enroll sufficient healthy volunteers or patientsmaintain these efforts in a competitive, cost-effective or timely manner, which could materially and may not be completed on schedule, if at all.

Clinical trials may be delayed for a variety of reasons, including delays related to:

We plan to rely on CROs and clinical trial sites to ensure the proper and timely conduct of our clinical trials. Although we expect that we will have agreements in place with CROs governing their committed activities and conduct, we will have limited influence over their actual performance. As a result, we ultimately do not and will not have control over a CRO's compliance with the terms of any agreement it may have with us, its compliance with applicable regulatory requirements, or its adherence to agreed time schedules and deadlines, and a future CRO's failure to perform those obligations could subject any of our clinical trials to delays or failure.

Further, we may also encounter delays if a clinical trial is suspended or terminated by us, by any IRB or Ethics Committee at an institution in which such trials are being conducted, by the Data Safety Monitoring Board, or DSMB, for the trial, if applicable, or by FDA, or other regulatory authorities. Such authorities may impose such a suspension or termination due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements, inspection of the clinical trial operations or trial site by FDA or other regulatory authorities resulting in the imposition of a clinical hold, exposing participants to health risks caused by unforeseen safety issues or adverse side effects, development of previously unseen safety issues, failure to demonstrate a benefit from using a drug candidate, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial. Therefore, we cannot predict with any certainty the schedule for commencement or completion of any currently ongoing, planned or future clinical trials.

If we experience delays in the commencement or completion of, or due to suspension or termination of, any clinical trial for our drug candidates, the commercial prospects of the drug candidate could be harmed, and our ability to generate product revenues from the drug candidate may be delayed or eliminated. In addition, any delays in completing our clinical trials will increase our costs, slow down our drug candidate development and approval process and jeopardize regulatory approval of our drug candidates and our ability to commence sales and generate revenues. The occurrence of any of these events could harm our business, financial condition and results of operationsour operations.

We also face competition from illegal dispensaries and prospects significantly.

We relythe black market that are unlicensed and expectunregulated, and that are selling cannabis and cannabis products, including products with higher concentrations of active ingredients, and using delivery methods that we are prohibited from offering to continue to rely completely on third parties to formulate and manufacture our preclinical, clinical trial and post-approval drug supplies. The development and commercialization of any of our drug candidates could be stopped, delayed or made less profitable if those third parties fail to provide us with sufficient quantities of such drug supplies or fail to do so at acceptable quality levels, including in accordance with applicable regulatory requirements or contractual obligations and our operations could be harmedindividuals as a result.

We have no experience in drug formulation or manufacturing. We dothey are not currently have, nor do we planpermitted by U.S. state or federal law. Any inability or unwillingness of law enforcement authorities to acquire,enforce existing laws prohibiting the infrastructure or capability internally, such as our own manufacturing facilities, to manufacture our preclinicalunlicensed cultivation and clinical drug supplies for use in the conduct of our clinical trials or commercial quantities of any drug candidates that may obtain regulatory approval. Therefore, we lack the resources and expertise to formulate or manufacture our own drug candidates. We have entered into agreements with third-party CMOs for the clinical-stage manufacture of certain of our drug candidate. We plan to enter into agreements with one or more manufacturers to manufacture, supply, store and distribute drug supplies for our current and future clinical trials and/or commercial sales. We intend to establish or continue those relationships for the supply of our drug candidates, however, there can be no assurance that we will be able to retain those relationships on commercially reasonable terms, if at all. If we are unable to maintain those relationships, we could experience delays in our development efforts as we locate and qualify new CMOs. If our current drug candidate or any drug candidates we may develop or acquire in the future receive regulatory approval, we will rely on one or more CMOs to manufacture the commercial supply of such drugs.

Our reliance on a limited number of CMOs exposes us to the following risks:

Each of these risks could delay our clinical trials, the approval, if any, of our drug candidates by FDA or the commercialization of our drug candidates or result in higher costs or deprive us of potential product revenues.

We expect to have no control over the ability of our contract manufacturers to maintain adequate quality control, quality assurance and qualified personnel. If any of our contract manufacturers cannot successfully manufacture material that conforms to our specifications and the strict regulatory requirements of FDA or other comparable foreign authorities, we would be prevented from obtaining regulatory approval for our drug candidates unless and until we engage a substitute contract manufacturer that can comply with such requirements, which we may not be able to do. Any such failure by any of our contract manufacturers would significantly impact our ability to develop, obtain regulatory approval for or market our drug candidates, if approved.

Further, we plan to rely on our manufacturers to purchase from third-party suppliers the materials necessary to produce our drug candidates for our clinical trials. We do not have, nor do we expect to enter into, any agreements for the commercial production of these raw materials, and we do not expect to have any control over the process or timing of our contract manufacturers' acquisition of raw materials needed to produce our drug candidates. Any significant delay in the supply of a drug candidate or the raw material components thereof for an ongoing clinical trial due to a manufacturer's need to replace a third-party supplier of raw materials could considerably delay completion of our clinical trials, product testing and potential regulatory approval of our drug candidates. Additionally, if our future manufacturers or we are unable to purchase these raw materials to commercially produce any of our drug candidates that gain regulatory approvals, the commercial launch of our drug candidates would be delayed or there would be a shortage in supply, which would impair our ability to generate revenues from the sale of our drug candidates.

Disagreements with respect to the commercial terms of our sales, licensing, purchase or manufacturing agreements may limit our commercial success.

The rightscannabis and obligations of the partners to which we may license our TAM-01 technology are governed by the Buck Institute License Agreement. In addition, our relationships with CROs and CMOs are governed by the service agreements between us and each manufacturer. Although we attempt to address the full range of possible events that may occur during the development or the manufacturing of TAM-01 drug candidate andcannabis-based products unanticipated or extraordinary events may occur beyond those contemplated by said agreements. Furthermore, our business relationships with our product manufacturers and our collaborators may include assumptions, understandings or agreements that are not included in our agreements with them, or that are inaccurately or incompletely represented by their terms. In addition, key terms in such agreements may be misunderstood or contested, even when both we and the other party previously believed that we had a mutual understanding of our obligations.

Any differences in interpretation or misunderstandings between us and other parties may result in substantial costs and delays with respect to the development, manufacturing or sale of TAM-01 drug product, and may negatively impact our revenues and operating results. Product manufacturers may fail to produce the products and partners may fail to develop the drug candidate under the timeline or in the manner we anticipated, and results may differ from the

terms upon which we had agreed. As a result, we may be unable to supply drugs of the quality or in the quantity demanded or required. We may suffer harm to our reputation in the market from missed development goals or deadlines, and may be unable to capitalize upon market opportunities as a result. Resolution of these problems may entail costly and lengthy litigation or dispute resolution procedures. In addition, there is no guarantee that we will prevail in any such dispute or, if we do prevail, that any remedy we receive, whether legal or otherwise, will adequately redress the harm we have suffered. The delays and costs associated with such disputes may themselves harm our business and reputation and limit our ability to successfully compete in the market going forward.

Our future success depends on our ability to retain our chief executive officer and chief financial officer and to attract, retain and motivate qualified personnel.

We are highly dependent on our chief executive officer, and chief financial officer and the other principal members of our management team that may be hired in the future. The loss of the services of any of these people could impede the achievement of our research, development and commercialization objectives.

Recruiting and retaining qualified and experienced scientific, clinical, manufacturing and sales and marketing personnel will also be critical to our success. We may not be able to attract and retain these personnel on acceptable terms given the competition among numerous pharmaceutical and biotechnology companies for similar personnel. We also experience competition for the hiring of scientific and clinical personnel from universities and research institutions. In addition, we rely on consultants and advisors, including scientific and clinical advisors, to assist us in formulating our research and development and commercialization strategy. Our consultants and advisors may be employed by employers or engaged by entities other than us and may have commitments under employment, consulting or advisory contracts with other entities that may limit their availability to us.

Our ability to timely submit an Investigational New Drug to FDA will depend on our ability to recruit all necessary personnel and to raise sufficient funds for such recruitment.

Our ability to execute on our current plan for the completion of all activities and submission of an IND to FDA will depend on our ability to recruit the necessary personnel to support our development activities. Failure to complete all hires as planned will result in significant delays in the submission of the IND, if at all. Further, our ability to hire and retain such personnel will depend on our ability to raise sufficient funds for such recruitment. Any delays in raising the necessary funds will result in recruiting delays, which in turn will delay the submission of the IND.

We expect to expand our development, regulatory and sales and marketing capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations.

We currently have two employees. We expect to experience significant growth in the number of our employees and the scope of our operations if we are able to successfully develop and commercialize TAM-01, particularly in the areas of regulatory affairs, sales and marketing. To manage our anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities and continue to recruit and train additional qualified personnel. Due to our limited financial resources, we may not be able to effectively manage the anticipated expansion of our operations or recruit and train additional qualified personnel. The physical expansion of our operations may lead to significant costs and may divert our management and business development resources. Future growth would impose significant added responsibilities on members of management, including:

•managing our clinical trials effectively, which we anticipate being conducted at numerous clinical sites; 

•identifying, recruiting, maintaining, motivating and integrating additional employees with the expertise and experience we will require;  

•managing our internal development efforts effectively while complying with our contractual obligations to licensors, licensees, contractors and other third parties;  

•managing additional relationships with various strategic partners, suppliers and other third parties;  

•improving our managerial, development, operational and finance reporting systems and procedures; and  

•expanding our facilities. 

Our failure to accomplish any of these tasks could prevent us from successfully growing our Company. Any inability to manage growth could delay the execution of our business plans or disrupt our operations.

We may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on our product candidate or indications that may be more profitable or for which there is a greater likelihood of success.

Because we have limited financial and management resources, we focus on a limited number of research programs and product candidates and are currently focused principally on TAM-01 as well as certain activities intended to advance TAM-03 as an oncology candidate, or in other disease areas where we deem TAM-03 to have the potential to address serious unmet need. As a result, we may forego or delay pursuit of opportunities with other product candidates or for other indications that later prove to have greater commercial potential. Our resource allocation decisions may cause us to fail to capitalize on viable commercial drugs or profitable market opportunities. Our spending on current and future research and development programs and product candidates for specific indications may not yield any commercially viable drugs. If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through future collaboration, licensing or other arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights.

Guidelines and recommendations published by various organizations can reduce the use of our product candidate.

Government agencies promulgate regulations and guidelines directly applicable to us and to our product candidate. In addition, professional societies, practice management groups, private health and science foundations and organizations involved in various diseases from time to time may also publish guidelines or recommendations to the healthcare and patient communities. Recommendations of government agencies or these other groups or organizations may relate to such matters as usage, dosage, route of administration and use of therapies.

Recommendations or guidelines suggesting the reduced use of our product candidate or the use of competitive or alternative products as the standard of care to be followed by patients and healthcare providers could result in decreased use of our product candidate.

We have incurred significant losses since our inception and anticipate that we will continue to incur significant losses for the foreseeable future.

We are a development stage company with limited operating history. To date, we have focused primarily on developing our lead product candidate, TAM-01 and follow-on compound TAM-03. Our product candidates will require substantial additional development time and resources before we would be able to apply for or receive regulatory approvals and begin generating revenue from product sales. We have incurred cumulative net loss from inception (August 13, 2014) to December 31, 2018 of $8,977,593.

We have devoted most of our financial resources to product and technology development. To date, we have financed our operations primarily through the sale of equity securities and convertible debt securities. The size of our future net losses will depend, in part, on the rate of future expenditures and our ability to generate revenue. To date, our product candidate has not been commercialized, and if our product candidate is not successfully developed or commercialized, or if revenue is insufficient following marketing approval, we will not achieve profitability and our business may fail. Even if we successfully obtain regulatory approval to market our product candidate in the United States, our revenue is also dependent upon the sizeperpetuation of the markets outside of the United States, as well as our ability to obtainblack market approval and achieve commercial success inside and outside the United States.

We expect to continue to incur substantial and increased expenses as we expand our development activities. We also expect an increase in our expenses associated with creating additional infrastructure to support operations as a public company. As a result of the foregoing, we expect to continue to incur significant and increasing losses and negative cash flows for the foreseeable future.

We have never generated any revenue and may never be profitable.

Our ability to generate revenue and achieve profitability depends on our ability, with collaborators, to successfully complete the development of, obtain the necessary regulatory approvals for, and commercialize our product candidate. We do not anticipate generating revenue from sales of our product candidate for the foreseeable future, if ever. Our ability to generate future revenue from product sales depends heavily on our success in:

•completing development of TAM-01; 

•obtaining regulatory approval for TAM-01; 

•completing development of TAM-03; 

•obtaining regulatory approval for TAM-03; and 

•launching and commercializing our product candidates for which we receive regulatory approval, either by building our own targeted sales force cannabis and/or by collaborating with third parties. 

Because of the numerous risks and uncertainties associated with pharmaceutical product development, we are unable to predict the timing or amount of increased expenses, when, or if, we will begin to generate revenue from product sales, or when, or if, we will be able to achieve or maintain profitability. In addition, our expenses could increase beyond expectations if we are required by FDA or other regulatory authority to perform studies in addition to those that we currently anticipate.

Even if our product candidate is approved for commercial sale, to the extent we do not engage a third party collaborator, we anticipate incurring significant costs associated with commercializing any approved product candidate. Even if we are able to generate revenue from the sale of any approved products, we may not become profitable and may need to obtain additional funding to continue operations.

If we fail to obtain additional financing, we would be forced to delay, reduce or eliminate our product development programs.

Developing pharmaceutical products is expensive. As of December 31, 2018, we had cash and cash equivalents of $57,641. As such, we will need additional financing in order to execute our plans. Attempting to secure financing will divert our management from day-to-day activities, which may adversely affect our ability to develop and commercialize our product candidates. In addition, we cannot guarantee that any financing will be available in sufficient amounts or on terms acceptable to us, if at all. If we are unable to raise additional capital when required or on acceptable terms, we may be required to:

•significantly delay, scale back or discontinue the development or commercialization of our product candidates;  

•seek corporate partners for our product candidates at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available;  

•relinquish or license on unfavorable terms, our rights to technologies or product candidates that we otherwise would seek to develop or commercialize ourselves; or  

•significantly curtail, or cease, operations. 

If we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we will be prevented from pursuing development and commercialization efforts, which will have a material adverse effect on our business, operating results and prospects.

There could be an adverse change or increase in the laws and/or regulations governing our business.

We and our operating subsidiary are subject to various laws and regulations in different jurisdictions, and the interpretation and enforcementperception of laws and regulations are subject to change. We are also subject to different tax

regulations in each of the jurisdictions where we conduct our business or where our management or the management of our operating subsidiary is located. We expect the scope and extent of regulation in the jurisdictions in which we conduct our business, or where our management or the management of our operating subsidiary is located, as well as regulatory oversight and supervision, to generally continue to increase. There can be no assurance that future regulatory, judicial and legislative changes in any jurisdiction will not have a material adverse effect on us or hinder us in the operation of its business.

Risks Related to Our Intellectual Property

If we are unable to obtain or protect intellectual property rights related to our product candidates, we may not be able to compete effectively in our market.

While we intend to continue to apply for patent protection with respect to our product candidates, the strength of patents in the life sciences field involves complex legal and scientific questions and can be uncertain. Patent applications may fail to result in issued patents with claims that cover the products in the United States or in other countries. If this were to occur, early generic competition could be expected against product candidates in development. There is also no assurance that all of the potentially relevant prior art relating to a patent application, which can invalidate a patent or prevent a patent from issuing based on a pending patent application, will be found.

Even if patents do successfully issue, third parties may challenge their validity, enforceability or scope, which may result in such patents being narrowed or invalidated, which could adversely affect our ability to establish market share or successfully execute our business strategy to increase sales of our products and would negatively impact our financial condition and results of operations, including causing a significant decrease in our revenues and cash flows.

Furthermore, patents and patent applications may not adequately protect our intellectual property, provide exclusivity for our product candidates or prevent others from designing around our patent claims. If a patent application fails to issue or if the breadth or strength of protection of a patent or patent application is threatened, competitors could directly compete against our products and we would have no recourse. We cannot offer any assurances about which, if any, patents will issue or whether any issued patents will be found valid and enforceable or will be unthreatened by third parties or will offer adequate coverage of our products. Further, if we encounter delays in regulatory approvals, the period of time during which we could market a product candidate could be reduced. Since patent applications in the United States and most other countries are confidential for a period of time after filing, and some remain so until issued, we cannot be certain that we were the first to file or invent any patent application. Furthermore, if a third party has filed such patent application, an interference proceeding in the United States can be provoked by such third party or instituted by us to determine who was the first to invent any of the subject matter covered by the patent claims of our applications. In the United States, the natural expiration of a maintained patent is generally 20 years after it is filed. Various extensions may be available; however the life of a patent, and the protection it affords, is limited. Once the patent life has expired, we may be open to competition from competitors that will be able to freely use our technology described in our expired patent(s).

In addition to the protection afforded by patents, we rely on trade secret protection and confidentiality agreements to protect proprietary know-how that is not patentable or which we elect not to patent, processes for which patents are difficult to enforce and any other elements of our development processes that involve proprietary know-how, information or technology that is not covered by patents. Although we expect all of our employees to assign their inventions to us, and all of our employees, consultants, advisors and any third parties who have access to our proprietary know-how, information or technology to enter into confidentiality agreements, we cannot provide any assurances that all such agreements have been duly executed or that our trade secrets and other confidential proprietary information will not be disclosed or that competitors will not otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques. We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems. While we have confidence in these individuals, organizations and systems, agreements or security measures may be breached, and we may not have adequate remedies for any breach. If the steps taken to maintain our trade secrets are deemed inadequate, we may have insufficient recourse against third parties for misappropriating the trade secret. In addition, our competitors may independently discover our trade secrets and proprietary information. For example, FDA, as part of its Transparency Initiative, is currently considering whether to make additional information publicly available on a routine basis, including information that we may consider to be trade secrets or other proprietary information, and it is not clear at the present

time how FDA's disclosure policies may change in the future, if at all.

Changes in either the patent laws or interpretations of the patent laws in the United States and other countries may diminish the value of our intellectual property or narrow the scope of our patent protection. An inability to obtain, enforce and defend patents covering our proprietary technologies would materially and adversely affect our business prospects and financial condition.

We may not be able to protect our intellectual property rights throughout the world.

Filing, prosecuting and defending patents on product candidates in all countries throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the United States may be less extensive than those in the United States. Further, the laws of some foreign countries do not tend to protect proprietary rights to the same extent or in the same manner as the laws of the United States. Consequently, we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions. Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and further, may export otherwise infringing products to territories where we have patent protection, but enforcement may not be as strong as that in the United States. These products may compete with our products and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing. As a result, we may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad. For example, if the issuance to us, in a given country, of a patent covering an invention is not followed by the issuance, in other countries, of patents covering the same invention, or if any judicial interpretation of the validity, enforceability, or scope of the claims in, or the written description or enablement in, a patent issued in one country is not similar to the interpretation given to the corresponding patent issued in another country, our ability to protect our intellectual property in those countries may be limited. Changes in either patent laws or in interpretations of patent laws in the United States and other countries may materially diminish the value of our intellectual property or narrow the scope of our patent protection. We may be unable to prevent material disclosure of the non-patented intellectual property related to our technologies to third parties, and there is no guarantee that we will have any such enforceable trade secret protection, and therefore we may not be able to establish or maintain a competitive advantage in our market, which could materially adversely affect our business, results of operations and financial condition.

Further, many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not tend to favor the enforcement of patents, trade secrets and other intellectual property protection, particularly those relating to biotechnology products, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our proprietary rights generally. Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license.

If we breach any of the agreements under which we license from third parties the intellectual property rights or commercialization rights to our drug candidate, particularly our license agreement with Buck Institute, we could lose license rights that are important to our business and our operations could be materially harmed.

Under the Buck Institute License Agreement, Mount Tam licenses significant intellectual property related to TAM-01 from the Buck Institute. Under the terms of the Buck Institute License Agreement, Buck Institute assigns to Mount Tam certain assets, materials and records resulting from the research. Mount Tam retains rights to inventions made by its employees, and Buck Institute assigns to Mount Tam all inventions made under the Buck Institute License Agreement jointly by Mount Tam's employees and Buck Institute personnel, provided that Mount Tam's employees have made a certain inventive contribution. With respect to all other inventions made in the course of the research, Buck Institute grants to Mount Tam worldwide exclusive license rights under patents and patent applications claiming such inventions. Buck Institute retains rights to practice these inventions for research and teaching purposes. Mount Tam bears the costs of filing, prosecution and maintenance of patents assigned or licensed to us under the Buck Institute License Agreement.

As consideration for the assignments and licenses, Mount Tam is obliged to pay to Buck Institute milestone payments on development of its proprietary products claimed by patents assigned or licensed to Mount Tam by Buck Institute. Mount Tam also is obliged to pay low single-digit royalties, including annual minimum royalties, on sales of such products. Should Mount Tam grant licenses or sublicenses to those patents to third parties, Mount Tam is obliged to pay to Buck Institute certain undisclosed variable fees as a function of out-licensing revenues, or the Out-License Fee, where such Out-License Fees are creditable against annual license payments to Buck Institute. Mount Tam's payment obligations are reduced by our proportionate contribution to a joint invention. Payment obligations terminate on expiration or annulment of the last patent covered by the agreement.

In addition to the Buck Institute License Agreement, we may seek to enter into additional agreements with other third parties in the future granting similar license rights with respect to other potential drug candidates. If we fail to comply with any of the conditions or obligations or otherwise breach the terms of the Buck Institute License Agreement, or any future license agreement we may enter on which our business or drug candidates are dependent, Buck Institute or other licensors may have the right to terminate the applicable agreement in whole or in part and thereby extinguish our rights to the licensed technology and intellectual property and/or any rights we have acquired to develop and commercialize certain drug candidates, including, with respect to the Buck Institute License Agreement, TAM-01  d. Under the Buck Institute License Agreement, Mount Tam can terminate the licenses to anycannabis use. Any or all licensed patents upon specified advance notice to Buck Institute. Buck Institute may terminate the license provisions of the agreement only for cause. Termination of the agreement does not terminate Mount Tam's rights in patents assigned to Mount Tam but would terminate Mount Tam's rights to patents licensed to it under the Buck Institute License Agreement. The loss of the rights licensed to Mount Tam under the Buck Institute License Agreement, or any future license agreement that we may enter granting us rights on which our business or drug candidates are dependent, would eliminate our ability to further develop the applicable drug candidates and would materially harm our business, prospects, financial condition and results of operations.

Claims that we infringe the intellectual property rights of others may prevent or delay our drug discovery and development efforts.

Our research, development and commercialization activities, as well as any drug candidates or products resulting from those activities, may infringe or be accused of infringing a patent or other form of intellectual property under which we do not hold a license or other rights. Third parties may assert that we are employing their proprietary technology without authorization.

There may be third-party patents of which we are currently unaware with claims that cover the use or manufacture of our drug candidates. Because patent applications can take many years to issue, there may be currently pending patent applications that may later result in issued patents that our drug candidates may infringe. In addition, third parties may obtain patents in the future and claim that use of our drug candidates infringes upon these patents. If our activities or drug candidates infringe the patents or other intellectual property rights of third parties, the holders of such intellectual property rights may be able to block our ability to commercialize such drug candidates unless we obtain a license under the intellectual property rights or until any applicable patents expire or are determined to be invalid or unenforceable.

Defense of any intellectual property infringement claims against us, regardless of their merit, would involve substantial litigation expense and would be a significant diversion of resources from our business. In the event of a successful claim of infringement against us, we may have to pay substantial damages, obtain one or more licenses from third parties, limit our business to avoid the infringing activities, pay royalties and/or redesign our infringing drug candidates or alter related formulations, processes, methods or other technologies, any or all of which may be impossible or require substantial time and monetary expenditure. Further, if we were to seek a license from the third party holder of any applicable intellectual property rights, we may not be able to obtain the applicable license rights when needed or on reasonable terms, or at all. Some of our competitors may be able to sustain the costs of complex patent litigation or proceeding more effectively than us because they have substantially greater resources. The occurrence of any of the above events could prevent us from continuing to develop and commercialize one or more of our drug candidates and our business could materially suffer.

We may desire to, or be forced to, seek additional licenses to use intellectual property owned by third parties, and such licenses may not be available on commercially reasonable terms or at all.

In addition to Buck Institute, other third parties may also hold intellectual property, including patent rights, that are important or necessary to the development of our drug candidate, in which case we would need to obtain a license from that third party or develop a different formulation of the product that does not infringe upon the applicable intellectual property, which may not be possible. Additionally, we may identify drug candidates that we believe are promising and whose development and other intellectual property rights are held by third parties. In such a case, we may desire to seek a license to pursue the development of those drug candidates. Any license that we may desire to obtain or that we may be forced to pursue may not be available when needed on commercially reasonable terms or at all. Any inability to secure a license that we need or desire could have a material adverse effect on our business, financial condition and prospects.results of operations.

Cannabis remains illegal under U.S. federal law, and enforcement of U.S. cannabis laws could change.

Cannabis is illegal under U.S. federal law. In those states in which the use of cannabis has been legalized, its use remains a violation of federal law pursuant to the Controlled Substances Act. The Controlled Substances Act classifies cannabis as a Schedule I controlled substance, and as such, medical and recreational cannabis use is illegal under U.S. federal law and federal authorities may enforce such federal laws. If that occurs, we may be deemed to be dispensing cannabis and drug paraphernalia in violation of federal law. Since federal law criminalizing the use of cannabis preempts state laws that legalize its use, enforcement of federal law regarding cannabis is a material risk and would greatly harm our business, prospects, revenue, results of operation and financial condition.

Our cannabis-related activities will be subject to evolving regulation by governmental authorities. We will be engaged in the cannabis industry in the United States where local and state law permits such activities, and cannabis remains illegal for some or all uses and circumstances in many states. The legality of the sale of cannabis differs among states in the United States. Due to the current regulatory environment in the United States, new risks may emerge, and management may not be able to predict all such risks.

Because our planned activities in the cannabis industry may be illegal under the applicable federal laws of the United States, there can be no assurances that the U.S. federal government will not seek to enforce the applicable laws against us. The consequences of such enforcement would be materially adverse to us and our business, including our reputation, profitability and the market price of our common stock, and could result in the forfeiture or seizure of all or substantially all of our assets.

Due to the conflicting views between state and federal governments regarding cannabis, cannabis businesses are subject to inconsistent laws and regulations. The prior U.S. administration attempted to address the inconsistent treatment of cannabis under state and federal law in the Cole Memorandum that Deputy Attorney General James Cole sent to all U.S. Attorneys in August 2013, which outlined certain priorities for the U.S. Department of Justice (“DOJ”) relating to the prosecution of cannabis offenses. The Cole Memorandum noted that, in jurisdictions that have enacted laws legalizing cannabis in some form and that have also implemented strong and effective regulatory and enforcement systems to control the cultivation, processing, distribution, sale and possession of cannabis, conduct in compliance with such laws and regulations was not a priority for the DOJ. However, the DOJ did not provide (and has not provided since) specific guidelines for what regulatory and enforcement systems would be deemed sufficient under the Cole Memorandum. During the Trump Administration, the Cole Memorandum was rescinded. However it is expected that the Biden Administration will either reinstate the Cole Memorandum or otherwise take a stance on cannabis that is more lenient than the Trump Administration’s stated policies. Nonetheless, the timing and scope that the Biden Administration’s policy changes, if any, remain unclear, including whether these policies will be more lenient on commercial cannabis operations such as ours as opposed to merely easing enforcement practices against individual cannabis users.

There can be no assurance that the federal government will not enforce federal laws relating to cannabis and seek to prosecute cases involving cannabis businesses that are otherwise compliant with state laws in the future. While most states that have legalized cannabis continue to craft their regulations pursuant to the Cole Memorandum and federal enforcement agencies have taken limited action against state-compliant cannabis businesses, the DOJ may change its enforcement policies at any time, with or without advance notice.

The uncertainty of U.S. federal enforcement practices going forward and the inconsistency between U.S. federal and state laws and regulations present material risks for us, and adverse developments in regulatory enforcement policies and efforts could have a material adverse effect on our business.

There is a substantial risk of regulatory or political change.

The success of our business strategy depends on the legality of the cannabis industry in the United States. The political environment surrounding the cannabis industry in the United States in general can be volatile and the regulatory framework in the United States remains in flux. Despite the currently implemented laws and regulations in the U.S. and its territories to legalize and regulate the cultivation, processing, sale, possession and use of cannabis, and additional states that have pending legislation regarding the same, the risk remains that a shift in the regulatory or political realm could occur and have a drastic impact on the industry as a whole, adversely impacting our ability to successfully invest and/or participate in the selected business opportunities.

Further, there is no guarantee that legislative bodies and/or voting constituents will not repeal, overturn or limit any such legislation legalizing the sale, disbursement and consumption of medical or recreational use of cannabis. It is also important to note that local and city ordinances may strictly limit and/or restrict disbursement of cannabis in a manner that will make it extremely difficult or impossible to transact business that is necessary for the continued operation of the cannabis industry even if state governments do not.

Cannabis remains illegal under U.S. federal law, and the U.S. federal government could bring criminal and civil charges against us or our subsidiaries or our investments at any time. Federal actions against any individual or entity engaged in the cannabis industry or a substantial repeal of cannabis-related legislation could have a material adverse effect on our business, financial condition or results of operations.

We may be involvedsubject to action by the U.S. federal government through various government agencies for participation in lawsuitsthe cannabis industry.

Since the cultivation, processing, production, distribution and sale of cannabis for any purpose, medical or recreational use or otherwise, remain illegal under U.S. federal law, it is possible that we or third parties with which we do business and/or on which we rely may be forced to cease any such activities. The U.S. federal government, through, among others, the DOJ, its sub-agency the U.S. Drug Enforcement Agency (the “DEA”) and the U.S. Internal Revenue Service (the “IRS”), has the right to actively investigate, audit and shut down cannabis-related businesses such as us. The U.S. federal government may also attempt to seize our property. Any action taken by the DOJ, the DEA and/or the IRS to interfere with, seize or shut down our operations will have an adverse effect on our business, prospects, revenue, results of operation and financial condition.

Since federal law criminalizing the use of cannabis preempts state laws that legalize its use, the federal government can seek to enforce criminal violations of federal law despite state laws permitting the use of cannabis. Despite a relatively passive stance on cannabis activity by the federal law enforcement agencies in recent years, the stated position of the current federal Administration is hostile to legal cannabis. As the rescission of the Cole Memorandum and the implementation of the Sessions Memorandum demonstrate, the DOJ may at any time issue additional guidance that directs federal prosecutors to devote more resources to prosecuting cannabis-related businesses. In the event that the DOJ under the U.S. Attorney General aggressively pursues financiers or equity owners of cannabis-related businesses, and U.S. Attorneys follow the DOJ policies through pursuing prosecutions, then we could face:

Because the Cole Memorandum was rescinded by the Sessions Memorandum, the DOJ under the current administration or an aggressive federal prosecutor could allege that the Company, our board of directors and, potentially, our shareholders, “aided and abetted” violations of federal law by providing finances and services to our portfolio cannabis companies. Under these circumstances, federal prosecutors could seek to seize our assets, and to recover the “illicit profits” previously distributed to shareholders resulting from any of our financing or services.

Violations of any federal laws and regulations could result in significant fines, penalties, administrative sanctions, convictions or settlements arising from civil proceedings conducted by either the federal government or private citizens, or criminal charges, including, but not limited to, disgorgement of profits, cessation of business activities or divestiture. These results could have a material adverse effect on us, including our reputation and ability to conduct business, our holding (directly or indirectly) of cannabis licenses in the United States, the listing of our securities on stock markets or exchanges, our financial position, operating results, profitability or liquidity or the market price of our common stock.

State and local regulation of cannabis is uncertain and changing.

As described above, to date the cannabis industry has been primarily regulated at the state and local levels of government. While we intend to initially only operate in California and to comply with all applicable state and local laws in any jurisdiction in which we operate, there can be no assurance that state laws legalizing and regulating the sale and use of cannabis will not be repealed or overturned, or that local governmental authorities will not limit the applicability of state laws within their respective jurisdictions. Further, state and local cannabis laws and regulations are subject to preemption by related federal laws and regulations, such that if the federal government enforces its laws, compliance state and local laws will not protect us from criminal claims and liability. Therefore, if the federal government begins to enforce federal laws relating to cannabis in states where the sale and use of cannabis is currently legal, or if existing state laws are repealed or curtailed, our business or operations in those states or under those laws would be materially and adversely affected. Federal actions against any individual or entity engaged in the cannabis industry or a substantial repeal of favorable cannabis-related legislation could materially adversely affect us, our business and our assets or investments.

The rulemaking process at the state level that applies to cannabis operators in any state will be ongoing and result in frequent changes. As a result, an effective compliance program will be essential to manage regulatory risk. We intend to develop and implement operating policies and procedures that are compliance-based and derived from the state regulatory structure governing ancillary cannabis businesses and their relationships to state-licensed or permitted cannabis operators. However, notwithstanding our efforts and diligence, regulatory compliance and the process of obtaining regulatory approvals can be costly and time-consuming. No assurance can be given that we will receive the requisite licenses, permits or cards to continue operating our business or otherwise take action necessary to comply with all applicable laws and regulations.

State regulatory agencies may require us to post bonds or significant fees.

There is a risk that a greater number of state regulatory agencies will begin requiring entities engaged in certain aspects of the cannabis industry to post a bond or significant fees when applying, for example, for a dispensary license or renewal, as a guarantee of payment of sales and franchise taxes. We are not able to quantify at this time the potential scope of such bonds or fees in the states in which we currently operate or may in the future operate, but they may be materially negative to our results of operations, financial condition and ultimate business success, individually or in the aggregate.

We may face state limitations on ownership of cannabis licenses.

Jurisdictions in which we plan operate may limit the number of cannabis licenses and certain economic or commercial interests in the entity that holds the license that can be held by one entity within that state. For example, the two California licenses we are in the process of acquiring require a two-step approach wherein we purchase 80% of the entity holding the licenses in Step 1 and the remaining 20% in Step 2 following state and local regulatory approval. While we are still in the process of paying the purchase price for Step 1, this process, which is the product of California regulatory requirements, has delayed and may further delay our ability to obtain and operate these licenses and generate revenue. Similar delays or difficulties in the future with respect to other businesses or licenses we may undertake to acquire could materially adversely affect our growth strategy and prospects.

Further, as a result of the completion of certain acquisition transactions that we have entered into or may enter into in the future, we may potentially hold more than the prescribed number of licenses or economic interests in a licensed entity in certain states, and accordingly may be required to divest certain licenses or entities that hold such license in order to comply with applicable regulations. The divestiture of certain licenses or entities that hold such licenses may result in a material, adverse effect on our business, financial condition, or results of operations.

We may become subject to FDA or ATF regulation.

Cannabis remains a Schedule I controlled substance under U.S. federal law. If the federal government reclassifies cannabis to a Schedule II controlled substance, it is possible that the U.S. Food and Drug Administration (the “FDA”) would seek to regulate cannabis under the Food, Drug and Cosmetics Act of 1938 (the “FDCA”). The FDA is responsible for ensuring public health and safety through regulation of food, drugs, supplements and cosmetics, among other products, through its enforcement authority pursuant to the FDCA. FDA’s responsibilities include regulating the ingredients as well as the marketing and labeling of drugs sold in interstate commerce. Because cannabis is federally illegal to produce and sell, and because it has no federally recognized medical uses, the FDA has historically deferred enforcement related to cannabis to the DEA; however, the FDA has enforced the FDCA with regard to industrial hemp-derived products, especially cannabidiol, or CBD, derived from industrial hemp sold outside of state-regulated cannabis businesses. The FDA has recently affirmed its authority to regulate CBD derived from both cannabis and industrial hemp, and its intention to develop a framework for regulating the production and sale of CBD derived from industrial hemp. It is also possible that the federal government could seek to regulate cannabis under the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”). The ATF may issue rules and regulations related to the use, transporting, sale and advertising of cannabis or cannabis products. Any such developments could materially adversely affect us, either directly or by negatively impacting third parties on whom we rely to operate.

Cannabis businesses are subject to enhanced anti-money laundering laws and regulations and have restricted access to banking and other financial services.

The Company and its subsidiaries will be subject to a variety of laws and regulations in the U.S. that involve money laundering, financial record-keeping and proceeds of crime, including the Bank Secrecy Act and the rules and regulations thereunder, and any related or similar rules, regulations or guidelines, issued, administered or enforced by governmental authorities in the U.S. Further, under U.S. federal law, banks or other financial institutions that provide a cannabis business with a checking account, debit or credit card, small business loan, or any other service could be found guilty of money laundering, aiding and abetting, or conspiracy.

If our operations, the revenue we generate or the capital we raise in the future were found to be in violation of money laundering laws, such transactions may be viewed as proceeds from a crime (the sale of a Schedule I drug) under the Bank Secrecy Act’s money laundering provisions. This may restrict our ability to declare or pay dividends or effect other distributions.

As a result of the robust regulation on banking practices as they relate to the funding of cannabis companies, most banks and other financial institutions in the United States have developed that restrict or limit the provision of banking services to cannabis-related businesses. In addition to the foregoing, banks may refuse to process debit card payments and credit card companies may refuse to process credit card payments for cannabis-related businesses. As a result, we may have limited or no access to banking or other financial services in the United States. In addition, federal money laundering statutes and Bank Secrecy Act regulations discourage financial institutions from working with any organization that sells a controlled substance, regardless of whether the state it operates in permits cannabis sales. The inability or limitation of our ability to open or maintain bank accounts, obtain other banking services and/or accept credit card and debit card payments may make it difficult for us to operate and conduct our business as planned or to operate efficiently. Banks and other depository institutions are currently hindered by federal law from providing financial services to cannabis businesses, even in states where those businesses are regulated, which will limit our access to capital resources which we may need in the future to grow and maintain our operations.

Because our contracts will involve cannabis and related activities, which are not legal under U.S. federal law, we may face difficulties in enforcing our contracts.

Because our contracts will involve cannabis and other activities that are not legal under federal law and in some state jurisdictions, we may face difficulties in enforcing our contracts in federal courts and certain state courts. Therefore, there is uncertainty as to whether we will be able to legally enforce our patentsagreements, which could have a material adverse effect on our business and results of operations.

We will be subject to restrictive and varying limitations on marketing our products.

Certain states have enacted strict regulations regarding marketing and sales activities on cannabis products. There may therefore be restrictions on sales and marketing activities imposed by government regulatory bodies that can hinder the development of the Company’s business and operating results. Restrictions can include regulations that specify the product, location and to end user for which our products can appear and/or be advertised. Marketing, advertising, packaging and labeling regulations also vary from state to state, potentially limiting the consistency and scale of consumer branding communication and product education efforts. The regulatory environment in the U.S. limits our ability to compete for market share in a manner similar to other industries, widening the gap between us and our competitors that have greater resources than we do and longer operating histories. If we are unable to effectively market our products and compete for market share, or if the costs of compliance with government legislation and regulation cannot be absorbed through increased selling prices for our products, our sales and operating results could be adversely affected.

The results of future clinical research of cannabis may be unfavorable to cannabis which may have a material adverse effect on the demand for our products.

Research regarding the medical benefits, viability, safety, efficacy and dosing of cannabis or isolated cannabinoids such as CBD and tetrahydrocannabinol, or THC remains in early stages. There have been relatively few clinical trials on the benefits of cannabis or isolated cannabinoids. Future research and clinical trials may prove positive assumptions regarding the use of cannabis to be incorrect, or could raise concerns regarding the safety or utility of cannabis use or of adverse health effects. Further, the cannabis industry is highly dependent upon consumer perception regarding the safety, efficacy and quality of the cannabis that is produced. Consumer sentiment can be significantly influenced by scientific research or findings regarding the consumption of cannabis products. If scientific research or findings contain negative conclusions or medical opinions regarding the benefits, viability, safety, efficacy, dosing, or other facts related to cannabis, it could therefore have a material adverse effect on the demand for our products, and in turn on our business, prospects, results of operation and financial condition.

Inconsistent public opinion of cannabis and the cannabis industry could hinder market growth and state adoption of permissive legislation and policies.

Public opinion surrounding cannabis use and the cannabis industry has traditionally been inconsistent and varies among markets and demographics. While public opinion and support appears to be rising generally for legalizing cannabis use, it remains a controversial issue subject to differing opinions surrounding the level of legalization (for example, medical cannabis as opposed to recreational use). Inconsistent public opinion and perception of cannabis may hinder growth and government adoption of permissive legislation and policies, which could have a material adverse effect on our business, financial condition or results of operations.

As a cannabis business, we will be subject to unfavorable tax treatment under the Internal Revenue Code.

Under Section 280E of the Internal Revenue Code of 1986, no deduction or credit is allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if the trade or business (or the activities which comprise the trade or business) consists of trafficking in controlled substances (within the meaning of Schedules I and II of the Controlled Substances Act) which is prohibited by federal law or the patentslaw of any state in which that trade or business is conducted. The IRS has applied this provision to cannabis operations, prohibiting them from deducting many expenses associated with cannabis businesses other than certain costs and expenses related to cannabis cultivation and manufacturing operations. Accordingly, Section 280E has a material impact on the operations of cannabis companies such as us. For example, what would otherwise be profitable operations could result in a loss after taking into account its U.S. income tax expenses.

Our subsidiaries may not be able to obtain necessary permits and authorizations.

We intend to operate cannabis dispensaries using subsidiaries to be formed for this purpose. Our subsidiaries may not be able to obtain or maintain the necessary licenses, permits, certificates, authorizations or accreditations to operate their respective businesses, or may only be able to do so at great cost. In addition, our licensors,subsidiaries may not be able to comply fully with the wide variety of laws and regulations applicable to the cannabis industry. Failure to comply with or to obtain the necessary licenses, permits, certificates, authorizations or accreditations could result in restrictions on a subsidiary’s ability to operate in the cannabis industry, which could be expensive, time-consuminghave a material adverse effect on our business, financial condition or results of operations.

Disparate state-by-state regulatory landscapes may require us to structure and unsuccessful.utilize complex operational and legal structures that could impose substantial costs on us or otherwise materially adversely affect our operations and financial condition.

Competitors may infringe our patents or the patentsIf we acquire additional cannabis licenses in jurisdictions outside of our current or potential licensors. To attempt to stop infringement or unauthorized use,California, we may need to file infringement claims,obtain and operate such licenses pursuant to a number of different transactional or corporate structures, depending on the regulatory requirements from state-to-state, including potentially realizing the economic benefit of cannabis licenses through management agreements and other commercial arrangements. Such agreements are often required to comply with applicable laws and regulations or are in response to perceived risks that we determine warrant such arrangements.

To the extent necessary for our expansion into additional markets, the foregoing structures will present various risks to us and our subsidiaries, including the following:

In any or all of the above situations, it would be difficult and expensive for us to protect our rights through litigation, arbitration, or similar proceedings.

The success of our cannabis business will depend, in part, on our ability to execute on our acquisition strategy, to successfully integrate acquired businesses and to retain key employees of acquired businesses.

While we intend to initially operate through the two California licenses following the closing of the anticipated Treehouse acquisition, we continue to evaluate strategic acquisition opportunities that have the potential to support and strengthen our business, including acquisitions in the United States, as part of our ongoing growth strategy. We cannot predict the timing or size of any future acquisitions. To successfully acquire a significant target, we may need to raise additional equity and/or indebtedness, which could increase our debt. There can be expensive and time-consuming and distract management.

Ifno assurance that we pursue any infringement proceeding, a court may decide that a patent of ours or our licensors is not valid or is unenforceable, or may refuse to stop the other party from using the relevant technology on the grounds that our patents do not cover the technology in question. Further, the legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, which could reduce the likelihood of success of, or the amount of damages that could be awarded resulting from, any infringement proceeding we pursue in any such jurisdiction. An adverse result in any infringement litigation or defense proceedings could put one or more of our patents at risk of being invalidated, held unenforceable, or interpreted narrowly and could put our patent applications at risk of not issuing, which could limit the ability of our drug candidates to compete in those jurisdictions.  Interference proceedings provoked by third parties or brought by the USPTO or at its foreign counterparts to determine the priority of inventionswill enter into definitive agreements with respect to any contemplated transaction or that any contemplated transaction will be completed. The investigation of acquisition candidates and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants, attorneys, and others. If we fail to complete any acquisition for any reason, including events beyond our patentscontrol, the costs incurred up to that point for the proposed acquisition would not be recoverable.

Acquisitions typically require integration of the acquired company’s assets, personnel, products and infrastructure. We may be unable to successfully integrate an acquired business into our existing business, and an acquired business may not be as beneficial or patent applications or those of our licensors. An unfavorable outcome could require us to cease using the related technology or to attempt to license rights to use it from the prevailing party. Our business could be harmed if the prevailing party does not offer us a license on commercially reasonable terms,profitable as and when expected or at all. Our inability to successfully integrate new businesses in a timely and orderly manner could increase costs and losses and diminish our ability to become profitable. Factors affecting the successful integration of an acquired business include, but are not limited to, the following:

Litigation or interference proceedings

Acquisitions involve risks that the acquired business will not perform as expected and that business judgments concerning the value, strengths and weaknesses of the acquired business will prove incorrect. In addition, potential acquisition targets may fail and, even if successful, maybe located in states in which we do not currently operate, which could result in substantial costsunforeseen operating difficulties and distract our managementdifficulties in coordinating geographically dispersed operations, personnel, and other employees.facilities. In addition, if we enter new geographic markets, we may be subject to additional and unfamiliar legal and regulatory requirements.

Risks RelatedThere can be no assurance that we will achieve the perceived benefits such as cost savings in connection with future acquisitions in the timeframe anticipated or at all. Many prospective businesses for acquisition are small private companies with unsophisticated financial statements that have not been independently reviewed or audited. Our inability to an Investment in Our Securities

Our limited operating history makes evaluatingeffectively identify, evaluate, negotiate, close and manage the integration of acquisitions could prevent us from meeting our business and futuregrowth objectives and harm our prospects difficult, and financial condition, in which case your investment in us would be at risk.

We will face security risks related to our physical facilities and cash transfers.

The business premises of our operating locations, when opened, could be targets for theft. While we intend to implement security measures at each location, our cannabis dispensaries could be subject to break-ins, robberies and other security breaches. If we experience a security breach, the loss of cannabis products or other assets could have a material adverse impact on our business. Further, we may increaseutilize third parties to assist in our security efforts, such as the transportation of cash we receive from sales from dispensaries to banks. These third parties may not be effective, and we will lack control over them. For example, an employee of a security company we engage could steal our assets or assist others in such a theft. Any of the foregoing risks could materially adversely harm our results of operations and financial condition.

We face exposure to fraudulent or illegal activity by employees, contractors, consultants and agents which may subject us to investigations and actions.

We will be exposed to the risk that any of our employees our independent contractors may engage in fraudulent or other illegal activity. Misconduct by these parties could include intentional, reckless and/or negligent conduct or disclosure of unauthorized activities or confidential information to us that violates government regulations, applicable business policies, practices or standards, laws that require the true, complete and accurate reporting of financial information or data, or other laws, regulations, rules or policies that are or may become applicable to us as a result of our operations. It may not always be possible for us to identify and deter misconduct by our employees and other third parties, and the precautions taken by us to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. We cannot provide assurance that our internal controls and compliance systems will protect us from acts committed by our employees, agents or business partners in violation of federal, state or local laws. If any investmentsuch actions are instituted against us, and we are not successful in defending the Company or asserting our common stock.rights, those actions could have a material impact on our business, including the imposition of civil, criminal and administrative penalties, damages, monetary fines, contractual damages, reputational harm, diminished profits and future earnings, and curtailment of our operations, any of which could have a material adverse effect on our business, financial condition or results of operations.

Our operations

We face risks related to date have beenthe novelty of the cannabis industry, and the resulting lack of information regarding comparable businesses, and the offering of new products in a constantly evolving market.

As a relatively new and constantly evolving industry, there are a limited number of established businesses and stakeholders in the cannabis market with a business model we can attempt to developing TAM-01replicate and follow-on compound TAM-03. In addition, as an early stage company, we havebuild upon. Similarly, there is limited experienceinformation about comparable businesses available for potential investors to review in making a decision on whether to invest in us.

Investors should evaluate the Company and have not yet demonstrated an ability to successfully overcome manyour prospects in light of the risks and uncertainties frequently encountered by companiesbusinesses, like us, that are in their early stages. For example, unanticipated expenses, operational problems or technical difficulties may occur, which may result in material delays in the operation of our business. We may fail to successfully address these contingencies or successfully implement our operating strategies effectively or at all. If we fail to do so, it could materially harm our business to the point of having to cease operations and/or reduce the value of our common stock, and investors may lose some or all of their investment.

We have committed and expect to continue committing significant resources and capital to develop and begin to implement our business plan and operations. However, the cannabis products we intend to obtain or license and market for consumption will likely be relatively untested in the marketplace, and there can be no assurance that we will obtain the rights to commercialize targeted products on favorable terms or at all, or that if we do the products we attempt to sell will achieve market acceptance. Moreover, these prospective products may be subject to significant competition with offerings by new and rapidly evolving fields, particularlyexisting competitors in the business with a more established market and a broader reach. The failure to successfully develop and market these new products could materially harm our business, prospects and financial condition.

We will be dependent on the popularity and market acceptance of our brand portfolio.

Our ability to generate revenue and be successful in the implementation of our business plan will be dependent on consumer acceptance of and demand for the products we sell. In the short-term, we intend to acquire the rights to use existing brands and products owned by third parties in order to commercialize our cannabis licenses in California. We may face difficulty obtaining these rights on favorable terms or at all. Further, if we do obtain the rights for the products as intended, acceptance of and demand for these products will depend on several factors, including availability, cost, ease of use, familiarity of use, convenience, effectiveness, safety and reliability. If these customers do not accept our products, or if such products fail to adequately meet customers’ needs and expectations, our ability to continue generating revenues could be reduced.

We believe that establishing and maintaining the brand identities of products will be a critical aspect of attracting and expanding a sufficient customer base to generate material revenue and expand our operations. Promotion and enhancement of brands will depend largely on the ability to offer high quality products. If customers and end users do not perceive the products we sell to be of high quality, or if we introduce new products or enter into new business ventures that are not favorably received or perceived by customers, end users or other stakeholders on which we will depend, we will risk diluting brand identities and decreasing their attractiveness to existing and potential customers. Moreover, in order to attract and retain customers and to promote and maintain brand equity in response to competitive pressures, we may have to increase our financial commitment to creating, obtaining, and maintaining a distinct brand loyalty among customers. If we incur significant expenses in an attempt to promote and maintain brands, this could be a material adverse effect on our business, financial condition or results of operations, particularly if these efforts are unsuccessful.

We will have a highly concentrated portfolio of assets and operate in a limited number of markets, and therefore face risks surrounding a lack of diversification.

With respect to the Elysian business, we intend to invest in and operate solely within the cannabis industry. Other than Elysian our only other operations are the production and sale of sporting goods and apparel through Norr. Thus, an investment in our Company will provide limited diversity as to asset type. Additionally, the assets to be held by us may be geographically concentrated from time to time. For example, our initial cannabis operations are expected to be limited to California, at least in the short-term. This lack of diversification could cause us to face difficulties in establishing material revenue, particularly if adverse external forces such as market or regulatory changes occur, and we may be unable to recover from these developments, in which case your investment would be at risk.

We will face risks related to our information technology systems, and potential cyber-attacks and security and privacy breaches.

We believe that the installment and use of technology will be a critical in our planned operations. As such, we will be susceptible to operational, financial and information security risks resulting from cyber-attacks and/or technological malfunctions. Successful cyber-attacks and/or technological malfunctions affecting us, or our service providers can result in, among other things, financial losses, the inability to process transactions, the unauthorized release of customer information or confidential information and reputational risk. There can be no assurance that we will not incur losses form such events in the future. As cybersecurity threats continue to evolve, we may be required to use additional resources to continue to modify or enhance protective measures or to investigate security vulnerabilities.

We may store and collect personal information about customers and would therefore be responsible for protecting that information from privacy breaches that may occur through procedural noncompliance or failures, information technology malfunction or deliberate unauthorized intrusions. To date, a growing number of states, including California where our initial cannabis operations will be centered, have implemented data privacy legislation aimed at ensuring data collectors and users comply with privacy and security standards, and penalizing those who fail to meet these standards. California has enacted the California Consumer Privacy Act of 2018 (the “CCPA”), which became operative in January 2020. The CCPA requires companies that process personal information on California residents to make new disclosures to consumers about such companies’ data collection, use, and sharing practices and inform consumers of their personal information rights such as deletion rights, allows consumers to opt out of certain data sharing with third parties, and provides a new cause of action for data breaches. In November 2020, California enacted the California Privacy Rights Act of 2020 (the “CPRA”), which amends and expands the scope of the CCPA, while introducing new privacy protections that extend beyond those included in the CCPA and its implementing regulations. The CCPA, as amended and expanded by the CPRA, is one of the most prescriptive general privacy law in the United States and may lead to similar laws being enacted in other U.S. states or at the federal level. Other states, including Colorado, Nevada, and Virginia have also implemented similar legislation.

Any data security or privacy breach and/or violation of data privacy laws such as the CCPA would have a material adverse effect on our business, prospects, revenue, results of operation and financial condition. We will be subject to laws, rules and regulations in the United States and other jurisdictions in which we operate or in which our customers reside relating to the collection, processing, storage, transfer and use of personal data. Our ability to execute transactions and to possess and use personal information and data in conducting our business subjects us to legislative and regulatory burdens that may require us to notify regulators and customers, employees and other individuals of a data security breach. Evolving compliance and operational requirements under the privacy laws, rules and regulations of jurisdictions in which we operate impose significant costs that are likely to increase over time. In addition, non-compliance could result in proceedings against us by governmental entities and/or significant fines, could negatively impact our reputation and may otherwise adversely impact our business, financial condition and operating results.

We face risks related to our insurance coverage and uninsurable risks.

Our operations will be subject to a number of risks and hazards generally, including adverse weather conditions, accidents, fires, labor disputes and changes in the regulatory environment. Such occurrences could result in damage to assets, personal injury or death, property damage, operational delays or challenges, monetary losses and possible civil or criminal liability and resulting costs, damages, fines and other adverse consequences.

Although we intend to acquire and maintain insurance to protect against certain risks and comply with certain applicable laws and regulations if and when we purchase and secure ownership of the two cannabis licenses in California, our insurance may not cover all the potential risks associated with our operations. We may also be unable to maintain insurance to cover these risks on economically feasible terms. Further, insurance coverage may not continue to be available or may not be adequate to cover any resulting liability. Uninsured or underinsured losses may cause us to incur significant costs which would have a material adverse effect upon our financial performance and results of operations.

Our reputation and ability to operate could be negatively impacted by our suppliers’ ability to produce and transport products.

We will depend on third-party suppliers to produce, provide for and timely deliver orders for the products we sell. Products manufactured or purchased from our suppliers will be resold to our customers. These suppliers could fail to produce products to our specifications or quality standards and may not deliver units on a timely basis. Any changes in our suppliers’ ability to resolve production issues, which could be caused by a variety of factors such as supply shortages which have recently arisen by COVID-19, could impact our ability to fulfill orders and could also disrupt our business due to delays in finding new suppliers.

We may face business disruption and related risks arising from the COVID-19 pandemic, which could have a material adverse effect on our business.

The sale of cannabis products by us could be materially adversely affected by the COVID-19 pandemic. We expect to be reliant upon cannabis sales at retail locations, and may not be successful in developing a material online sales presence. Retail sales declined in many industries and at various times throughout the pandemic, due in part to decreased demand caused by economic hardship and uncertainty and production challenges caused by supply shortages and the lockdowns. While vaccinations beginning in 2021 allowed for the partial reopening of the economy, the recent “Omicron” variant of the virus, potential new variants of the virus, as well as reduced efficacy of vaccines over time and the possibility that a large number of people decline to get vaccinated or receive booster shots, creates inherent uncertainty as to the future of our business, our industry and the economy in general in light of the pandemic.

We are still assessing our business plans and the impact COVID-19 may have on our ability to commercialize cannabis licenses and products, but there can be no assurance that this analysis will enable us to avoid or mitigate part or all of any impact from the spread of COVID-19 or its consequences, including macroeconomic downturns. The extent to which the COVID-19 pandemic and global efforts to contain its spread will impact our operations will depend on future developments, which for a variety of reasons including those described above are highly uncertain and cannot be predicted at this time. If we or third parties on which we rely are unable to navigate the pervasive and evolving challenges posed by the pandemic, our prospects and results of operations could be materially adversely affected.

Because of the Russian invasion of Ukraine, the effect on the capital markets and the economy is uncertain, and as a result we may have to deal with a recessionary economy and economic uncertainty including possible adverse effects upon our ability to raise capital as and when needed.

As a result of the Russian invasion of Ukraine, certain events are beginning to effect the global and U.S. economy including increased inflation, substantial increases in the prices of oil and gas, large Western companies ceasing to do business in Russia and uncertain capital markets with declines in leading market indexes. The duration of this war and its impact are at best uncertain. Ultimately the economy may turn into a recession with uncertain and potentially severe impacts upon public companies and us, including our ability to raise capital. We cannot predict how this will affect our operations or the industries in which we operate, however any such impact may be material and adverse.

We face an inherent risk of product liability claims as a manufacturer, processor and producer of products that are meant to be consumed by humans.

As a seller of products designed to be ingested or otherwise consumed by humans, we will face an inherent risk of exposure to product liability claims, regulatory action and litigation if our products are alleged to have caused significant loss or injury. In addition, the sale of these products involves the risk of injury to consumers including due to tampering by unauthorized third parties or product contamination. Previously unknown adverse reactions resulting from human consumption of our products alone or in combination with other medications or substances could occur. We may be subject to various product liability claims, including, among others, that the products sold by us, which will be purchased by us from third party licensed producers, caused injury, illness or death, include inadequate instructions for use or include inadequate warnings concerning possible side effects or interactions with other substances. Because of our business model, we expect to have limited control over the production process of the products we sell to the public. Despite our lack of manufacturing operations, we could be held liable under a product liability claim which generally imposes strict liability across all parties in the production, supply and marketing processes. A product liability claim or regulatory action against us could result in increased costs, could adversely affect our reputation with our customers and consumers generally and could have a material adverse effect on our business, results of operations and financial condition. There can be no assurances that we will be able to obtain or maintain product liability insurance on acceptable terms or with adequate coverage against potential liabilities. Such insurance is expensive and may not be available in the future on acceptable terms, or at all. The inability to obtain sufficient insurance coverage on reasonable terms or to otherwise protect against potential product liability claims could prevent or inhibit the commercialization of our potential products.

Intellectual property on which we will rely may be difficult or impossible to protect.

We intend to rely upon certain proprietary intellectual property, including but not limited to trademarks, trade names, copyrights and trade secrets, which may be developed internally and/or licensed from third parties. Our success will depend, in part, on our ability to maintain and enhance protection for such intellectual property and proprietary information. We generally enter into confidentiality or non-disclosure agreements with our employees, consultants, and collaborators. These agreements may be breached, may not effectively assign rights to proprietary information and intellectual property to us, and may fail to adequately protect us or our intellectual property rights or proprietary information in scope or duration. In addition, our proprietary information could be independently discovered by competitors, in which case we may not be able to prevent the use of such proprietary information by our competitors. The enforcement of a claim alleging that a party illegally obtained and was using our proprietary information could be difficult, expensive, and time consuming and the outcome would be unpredictable. In addition, courts outside the United States may be less willing to protect such proprietary information. The failure to obtain or maintain meaningful intellectual property protection could adversely affect our competitive position.

In addition, effective future copyright and trade secret protection may be unavailable or limited and may be unenforceable. As long as cannabis remains illegal under U.S. federal law as a Schedule I controlled substance pursuant to the Controlled Substances Act, the benefit of certain federal laws and protections which may be available to most businesses, such as federal trademark protection regarding the intellectual property of a business, may not be available to us. While many states do offer the ability to protect trademarks independent of the federal government, state-registered trademarks provide a lower degree of protection than would federally registered marks. As a result, our intellectual property may never be adequately or sufficiently protected against the use or misappropriation by third parties.

Further, if intellectual property that we license from third parties is infringed, the licensor may allege that we caused the infringement and assert a claim for monetary damages, under contractual indemnification provisions or otherwise. The defense against such a claim, regardless of merit, could be costly and divert management’s attention away from operations, and an adverse outcome could materially harm our financial condition.

Our failure or inability to adequately protect proprietary information and intellectual property on which we rely, including intellectual property that we may license from third parties or otherwise obtain under contractual arrangements, could have a material adverse effect on our business, financial condition or results of operations.

We may be exposed to infringement or misappropriation claims by third parties, which, if determined adversely to us, could subject us to significant liabilities and other costs.

Our success will depend on our ability to use products and branding without infringing the intellectual property rights of third parties. We cannot assure that third parties will not assert intellectual property claims against us. We are subject to additional risks if entities licensing intellectual property to us do not have adequate rights to the licensed materials. If third parties assert copyright or patent infringement or violation of other intellectual property rights against us or our third party product licensors or suppliers, we may be required to defend our self in litigation or administrative proceedings, which can be both costly and time consuming and may significantly divert the efforts and resources of management personnel. Further, we may be forced to discontinue allegedly infringing product lines, processes or other operational components, which could materially adversely affect our results of operations. An adverse determination in any such litigation or proceedings to which we may become a party could subject us to significant liability to third parties, require us to seek licenses from third parties, require us to pay ongoing royalties or subject us to injunctions that may prohibit the development and operation of our applications.

The products we market may be subject to product recalls, which may result in expense, legal proceedings, regulatory action, loss of sales and reputation, and management attention.

Despite quality control procedures, products designed for human consumption are sometimes subject to the recall or return for a variety of reasons, including product defects, such as contamination, unintended harmful side effects or interactions with other substances, packaging safety and inadequate or inaccurate labeling disclosure. If any of the products we market, which will likely be purchased by us from a third party licensed producers in most cases, are recalled due to an alleged product defect or for any other reason, we could be required to incur the unexpected expense of the recall and any legal proceedings that might arise in connection with the recall. We may lose a significant amount of sales and may not be able to replace those sales at an acceptable margin, if at all. In addition, a product recall may require significant attention from management. Particularly given our anticipated reliance on third party licensors and manufacturers to provide us with the products we will sell, there can be no assurance that any quality, potency or contamination problems will be detected in time to avoid unforeseen product recalls, regulatory action or lawsuits. Additionally, if one of the brands we use becomes subject to recall, the image of that brand and the Company could be harmed. A recall for any of the foregoing reasons could lead to decreased demand for our products and could have a material adverse effect on our results of operations and financial condition. Additionally, product recalls may lead to increased scrutiny of our operations by the FDA, or other regulatory agencies, requiring further management attention and potential legal fees and other expenses.

Synthetic products from the pharmaceutical area. Norindustry may compete with cannabis use and products.

The pharmaceutical industry may attempt to dominate the cannabis industry, and in particular, legal cannabis, through the development and distribution of synthetic products which emulate the effects and treatment of organic cannabis. If they are successful, the widespread popularity of such synthetic products could change the demand, volume and profitability of the cannabis industry. This could adversely affect our ability to generate material revenue or secure long-term profitability and success through the operation of cannabis licenses and the sale of cannabis products, which could have a material adverse effect on our anticipated business, financial condition and results of operations.

Risks Relating to Our Company and Financial Condition

Our ability to continue as a going concern is in doubt unless we demonstratedobtain adequate new debt or equity financing and achieve sufficient sales levels.

As discussed in Note 1 to the consolidated financial statements, the Company has an accumulated deficit, recurring losses, and negative cash flows that raise substantial doubt about the Company’s ability to continue as a going concern. Our continued existence is dependent upon generating sufficient working capital and obtaining adequate new debt or equity financing. These factors raise substantial doubt about our ability to continue as a going concern for a period of 12 months. Management cannot provide assurance that we will ultimately achieve or maintain profitable operations or become cash flow positive or raise debt and/or equity capital to continue and grow our operations. Because of our continuing losses, without improvements in our cash flow from operations or new financing, we may have to continue to restrict our expenditures. Management estimates needing at least $10 million to fund our planned expenditures and operations over the next 12 months. Working capital limitations may impinge on our day-to-day operations, which may contribute to continued operating losses. If any of the foregoing should happen, our shareholders could lose some or all of their investment.

If we cannot manage our growth effectively, we may not become profitable.

Businesses, including development stage companies such as ours and/or any operating business or businesses we may acquire, often grow rapidly and tend to have difficulty managing their growth. If we are able to acquire an operating business, we will likely need to expand our management team and other key personnel by recruiting and employing experienced executives and key employees and/or consultants capable of providing the necessary support.

We cannot assure you that our management will be able to manage our growth effectively or successfully. Our failure to meet these challenges could cause us to lose money, and your investment could be lost.

Because we have limited capital, we may need to raise additional capital in the future by issuing debt or equity securities, the terms of which may dilute our current investors and/or reduce or limit their liquidation or other rights.

We have now sold all of the shares of Ecoark common stock previously held by us, and will require additional capital to implement our business plan, including opening Elysian Stores as planned as well as growing our Norr operations. We may not be able to obtain additional capital when required. Future business development activities, as well as administrative expenses such as salaries, insurance, general overhead, legal and compliance expenses and accounting expenses will require a substantial amount of additional capital.

The terms of securities we issue in future capital transactions may be more favorable to new investors, and may include liquidation preferences, superior voting rights or the issuance of other derivative securities, which could have a further dilutive effect on or subordinate the rights of our current investors. Any additional capital raised through the sale of equity securities will likely dilute the ownership percentage of our shareholders. Additionally, any debt securities we issue would likely create a liquidation preference superior that of our current investors and, if convertible into shares of common stock, would also pose the risk of dilution.

We may be unable to obtain necessary financing if and when required.

Our ability to obtain regulatory approvalfinancing, if and when necessary, may be impaired by such factors as the capital markets (both in general and in the particular industry or industries in which we may choose to operate), our limited operating history and current lack of operations, the national and global economies and the condition of the market for microcap securities. Further, economic downturns such as the current global depression caused by the COVID-19 pandemic may increase our requirements for capital, particularly if such economic downturn persists for an extended period of time or after we have acquired an operating entity, and may limit or hinder our ability to commercializeobtain the funding we require. If the amount of capital we are able to raise from financing activities, together with any revenues we may generate from future operations, is not sufficient to satisfy our capital needs, we may be required to discontinue our development or implementation of a product candidate. Consequently,business plan, cancel our search for business opportunities, cease our operations, divest our assets at unattractive prices or obtain financing on unattractive terms. If any predictions aboutof the foregoing should happen, our shareholders could lose some or all of their investment.

Because we are dependent upon Richard Horgan, our Chief Executive Officer and sole director to manage and oversee our Company, the loss of him or any difficulty hiring or retaining other key personnel could adversely affect our plan and results of operations.

We currently have a sole director and officer, Richard Horgan, who manages the Company and is presently evaluating a viable plan for our future performanceoperations. We will rely solely on his judgment in connection with selecting a target company and the terms and structure of any resulting business combination. In order to be successful, we will need to obtain key personnel to assist Mr. Horgan in his efforts to develop and implement the Company’s business plan. We may not be unable to obtain such personnel prior to acquiring a business or at all. Competition in the market for the human resources that we expect we will need is intense, and we may have difficulty procuring adequate employees and/or consultants without investing significant financial resources on their salaries, fees, or other compensation. Further, given our current search for a business opportunity, we may have to delay hiring additional personnel until such time as accurate as theywe have sufficient capital to meet both the required amounts to make attractive offers to operating entities and to fund our future operations. The loss of our Chief Executive Officer, or any difficulty or inability to procure other qualified personnel, could delay or prevent the achievement of our business objectives, which could have a material adverse effect upon our results of operations and financial position.

Because we lack a controlling shareholder, if Mr. Horgan were unavailable we may be ifunable to cause the Company to elect a replacement director. In that event we hadwould cease operations.

In addition, the officers and directors of an acquisition candidate may resign upon completion of a historycombination with their business. The departure of successfully developinga target’s key personnel could negatively impact the operations and commercializingprospects of our post-combination business. The role of a significant numbertarget’s key personnel upon the completion of pharmaceutical products.the transaction cannot be ascertained at this time. Although we contemplate that certain or all members of a target’s management team may remain associated with the target following a change of control thereof, there can be no assurance that all of such target’s management team will decide to remain in place. The loss of key personnel, either before or after a business combination and including management of either us or a combined entity could negatively impact the operations and profitability of our business.

Risks Related to Our Common Stock

Due to factors beyond our control, our stock price may be volatile.

There is currently a limited market for our common stock, has limited liquidity.

Our common stock is quoted on the OTC Markets (OTC Pink). OTC Pink securities are not listed or traded on the floor of an organized national or regional stock exchange. Instead, OTC Pink securities transactions are conducted through a telephone and computer network connecting dealers in stocks. OTC Pink issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a regional or national stock exchange. As such, our securities are thinly traded compared to larger more widely known companies in the same industry. Thinly traded common stockthere can be more volatile than stock trading inno guarantee that an active public market. We cannot predict the extent to which an active public market for our common stock will develop, oreven if we are successful in consummating a business combination. Further, even if an active market for our common stock develops, it will likely be sustained. In addition,

there is no assurancesubject to by significant price volatility when compared to more seasoned issuers. We expect that trading in the Company'sprice of our common stock will continue to be more volatile than more seasoned issuers for the foreseeable future. Fluctuations in the price of our common stock can be based on various factors in addition to those otherwise described in this Report, including:

Many of these factors are beyond our control and may decrease the market price of our common stock, regardless of whether we can consummate a business combination and of our current or subsequent operating performance and financial condition. In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been instituted. A securities class action suit against us could result in substantial costs and divert our management’s time and attention, which would otherwise be used to benefit our business.

Because trading in our common stock is so limited, investors who purchase our common stock may depress the market if they sell common stock.

Our common stock trades on the OTC Pink Market, the successor to the pink sheets. The OTC Pink Market generally is illiquid and most stocks traded there are of companies that are not required to file reports with the SEC under the Securities Exchange Act of 1934. While we voluntarily file Forms 10-Q and 10-K with the SEC, we are a voluntary filer and not required to file reports with the SEC. Our common stock itself infrequently trades. For example, on December 31, 2021, our common stock price closed at $1.00 with 33 shares traded. Yahoo Finance reported that the average daily volume was 1,841 shares as of February 28, 2022. Accordingly, any sales may depress the trading price.

The market price of our common stock may decline if a substantial number of shares of our common stock are sold at once or on any other securities exchange or quotation medium.in large blocks.

OurPresently the market for our common stock is categorized as a penny stock.  Tradinglimited. If an active market for our shares develops in the future, some or all of our shareholders may sell their shares of our common stock which may depress the market price. Further, Rule 144 will not be restrictedavailable if we are deemed to be a “shell” company, unless an exemption from the definition applies. Any sale of a substantial number of these shares in the public market, or the perception that such a sale could occur, could cause the market price of our common stock to decline, which could reduce the value of the shares held by our other shareholders.

Future issuance of our common stock could dilute the interests of our existing shareholders, particularly in connection with an acquisition and any resulting financing.

We may issue additional shares of our common stock in the future. The issuance of a substantial amount of our common stock could substantially dilute the interests of our shareholders. In addition, the sale of a substantial amount of common stock in the public market, either in the initial issuance or in a subsequent resale by the SEC's pennytarget company in a business combination which received our common stock regulations which may limit a shareholder's ability to buy and sellas consideration or by investors who has previously acquired such common stock could have an adverse effect on the market price of our common stock.

OurBecause our common stock is categorized as a penny stock. subject to the “penny stock” rules, brokers cannot generally solicit the purchase of our common stock, which adversely affects its liquidity and market price.

The SEC has adopted Rule 15g-9regulations which generally defines "penny stock"define “penny stock” to be anyan equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securitiesspecific exemptions. The market price of our common stock on the OTC Pink Market is presently less than $5.00 per share and therefore we are covered by the pennyconsidered a “penny stock” company according to SEC rules. Further, we do not expect our stock rules, which impose additional sales practice requirements on broker-dealers who sellprice to persons other than established customers and accredited investors. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the SEC which provides information about penny stocks and the nature and level of risksrise above $5.00 in the penny stock market.foreseeable future. The “penny stock” designation requires any broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson inselling our securities to disclose certain information concerning the transaction, and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior toobtain a transaction in a penny stock not otherwise exemptwritten agreement from these rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receivedetermine that the purchaser's written agreementpurchaser is reasonably suitable to purchase the transaction.securities. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules.  Consequently, these penny stock rules may affectlimit the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketabilitysolicit purchases of our common stock.stock and therefore reduce the liquidity of the public market for our shares.

Moreover, as a result of apparent regulatory pressure from the SEC and the Financial Industry Regulatory Authority (“FINRA”), a growing number of broker-dealers decline to permit investors to purchase and sell or otherwise make it difficult to sell shares of penny stocks. The “penny stock” designation may have a depressive effect upon our common stock price.

Because of FINRA sales practice requirements may also limit a shareholder's ability to buy and sellwhich affect broker-dealers, the market price for our stock.common stock will be adversely affected.

In addition to the "penny stock" rules described above, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low pricedlow-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer'scustomer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low pricedlow-priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy shares of our common stock, which may limit yourour shareholders’ ability to buy and sell our common stock and have an adverse effect on the market for our shares. Further, due to FINRA regulation, there are a limited number of broker dealers which will handle penny stocks, which impairs the market and reduces the market price.

To date, we have not paid any cash dividends and no cash dividends will be paid inDue to recent changes to Rule 15c2-11 under the foreseeable future.

We do not anticipate paying cash dividends onExchange Act, our common stock may become subject to limitations or reductions on stock price, liquidity or volume.

On September 16, 2020, the SEC adopted amendments to Rule 15c2-11 under the Exchange Act. This Rule applies to broker-dealers who quote securities listed on over-the-counter markets such as our common stock. The Rule as amended prohibits broker-dealers from publishing quotations on OTC markets for an issuer’s securities unless they are based on current publicly available information about the issuer. When it becomes effective, the amended Rule will also limit the Rule’s “piggyback” exception, which allows broker-dealers to publish quotations for a security in reliance on the foreseeable future andquotations of a broker-dealer that initially performed the information review required by the Rule, to issuers with current publicly available information or issuers that are up-to-date in their Exchange Act reports. As of this date, we are uncertain as what actual effect the Rule may not have sufficient funds legally available to pay dividends.  Even ifon us.

The Rule changes could harm the funds are legally available for distribution, we may nevertheless decide not to pay any dividends.  We presently intend to retain all earnings for our operations.

Our common shares are not currently traded with any substantial volume, and you may be unable to sell at liquidity and/or near ask prices or at all if you need to sell or liquidate a substantial numbermarket price of shares at one time.

We cannot predict the extent to which an active public market for our common stock will developby either preventing our shares from being quoted or be sustained.  

Our common shares are currently quoted, but currently with little to no volume, based on quotations on the OTC Markets (OTC Pink), meaning that the numberdriving up our costs of persons interested in purchasing our common shares at or near bid prices at any given time may be relatively small or non-existent.  This situation is attributable to a number of factors, including the fact thatcompliance. Because we are a smallvoluntary filer under Section 15(d) of the Exchange Act and not a public reporting company, the practical impact of these changes is to require us to maintain a level of periodic disclosure we are not presently required to maintain, which is still relatively unknownwould cause us to stock analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that evenincur material additional expenses. Further, if we came to the attentioncannot or do not provide or maintain current public information about our company, our shareholders may face difficulties in selling their shares of such persons, they tend to be risk-averse and would be reluctant to follow an unproven company such as ours or purchase or recommend the purchase of our shares until such time as we became more seasoned and viable.  As a consequence, there may be periods of several days or more when trading activity in

our shares is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on share price.  We cannot give you any assurance that a broader or more active public trading market for our common stock will developat desired prices, quantities or be sustained,times, or that trading levels will be sustained.

Shareholders should be aware that, according to SEC Release No. 34-29093, the market for "penny stocks" has suffered in recent years from patterns of fraud and abuse.  Such patterns include (1) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (2) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (3) boiler room practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (4) excessive and undisclosed bid-ask differential and markups by selling broker-dealers; and (5) the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the resulting inevitable collapse of those prices and with consequent investor losses.  Our management is aware of the abuses that have occurred historically in the penny stock market.  Although we do not expect to be in a position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the confines of practical limitations to prevent the described patterns from being established with respect to our securities. The occurrence of these patterns or practices could increase the future volatility of our share price.

Our corporate actions are substantially controlled by our principal shareholders and affiliated entities.

As of April 4, 2019, our principal shareholders, which includes our officers and directors, own approximately 49.6% of our outstanding shares of common stock. These shareholders, acting individually or as a group, could exert substantial influence over matters such as electing directors and approving mergers or other business combination transactions.  In addition, because of the percentage of ownership and voting concentration in these principal shareholders and their affiliated entities, elections of our Board will generally be within the control of these shareholders and their affiliated entities. Whileat all, of our shareholders are entitled to vote on matters submitted to our shareholders for approval, the concentration of shares and voting control presently lies with these principal shareholders and their affiliated entities. As such, it would be difficult for shareholders to propose and have approved proposals not supported by management. There can be no assurances that matters voted upon by our officers and directors in their capacity as shareholders will be viewed favorably by all of our shareholders.

The elimination of monetary liability against our directors, officers and employees under Nevada law and the existence of indemnification rights to our directors, officers and employees may result in substantial expenditures by our company and may discourage lawsuits against our directors, officers and employees.

Our Articles of Incorporation, as amended, contain a provision permitting us to eliminate the liability of our directors for monetary damages to our company and shareholders to the extent provided by Nevada law. We may also have contractual indemnification obligations under our employment agreements with our officers. The foregoing indemnification obligations could result in our company incurring substantial expenditures to cover the cost of settlement or damage awards against directors and officers, which we may be unable to recoup.  These provisions and resultant costs may also discourage our company from bringing a lawsuit against directors and officers for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our shareholders against our directors and officers even though such actions, if successful, might otherwise benefit our company and shareholders.

Legislative actions, higher insurance costs and potential new accounting pronouncements may impact our future financial position and results of operations.

There have been regulatory changes and there may potentially be new accounting pronouncements or additional regulatory rulings that will have an impact on our future financial position and results of operations. In addition, insurers are likely to increase premiums as a result of high claims rates over the past several years, which we expect will increase our premiums for insurance policies. Further, there could be changes in certain accounting rules.  These and other potential changes could materially increase the expenses we report under generally accepted accounting principles, and adversely affect our operating results.

We may have material liabilities that were not discovered before, and have not been discovered since, the closing of the Exchange Agreement.

As a result of the Share Exchange, the former business plan and management of the registrant, previously known as "TabacaleraYsidron, Inc.", have been abandoned and replaced with the business and management team of Mount Tam. Prior to the Share Exchange, there were no relationships or other connections among the businesses or individuals associated with those two entities. As a result, we may have material liabilities based on activities before the Share Exchange that have not been discovered or asserted. We could experience losses as a result of any such undisclosed liabilities that are discovered in the future, which could materially harm our business and financial condition. Although the Exchange Agreements and the other agreements entered into in connection with the Share Exchange contains customary representations and warranties from Mount Tam and the registrant concerning their respective assets, liabilities, financial condition and affairs, there may be limited or no recourse against pre-Share Exchange shareholders or principals in the event those representations prove to be untrue. As a result, our current and future shareholders will bear some, or all, of the risks relating to any such unknown or undisclosed liabilities.

We may be exposed to additional risks as a result of "going public" by means of a reverse acquisition transaction.

We may be exposed to additional risks because the business of Mount Tam has become a public company through a "reverse acquisition" transaction. There has been increased focus by government agencies on transactions such as the Share Exchange in recent years, and we may be subject to increased scrutiny by the SEC and other government agencies and holders of our securities as a result of the completionamendments to the Rule.

Our shareholders do not have dissenters’ rights with respect to an acquisition of a controlling interest in the Company.

Section 78.378 of the Nevada Revised Statutes allows a corporation to limit the application of the statutory provisions with respect to dissenters’ rights applicable to the acquisition of a controlling interest in a corporation. On August 19, 2015 we amended our bylaws to provide that transaction. Further, asSection 78.3793 of the Nevada Revised Statutes, Nevada’s dissenters’ rights statute, does not apply to the shareholders of the Company. As a result, any of our existence asshareholders who do not approve a "shell company"transaction that results in the issuance or transfer of a controlling interest in the Company will not have the rights generally afforded under applicable rulesthat provision with respect to such a transaction, including the right to receive payment of the SEC priorfair value of their shares as provided therein. Therefore, if the acquisition of a controlling interest in the Company were to the closing of the Exchange Agreement on August 13, 2015, we are subject to certain restrictions and limitations for certain specified periods of time relating to potential future issuancesoccur, any of our securitiesdissenting shareholders may be left without recourse and compliancemay be unable to subsequently sell their shares at the prices they desire or at all.

Because we may issue preferred stock without the approval of our shareholders and have other anti-takeover defenses, it may be more difficult for a third-party to acquire us and could depress our stock price.

Our Board may issue, without a vote of our shareholders, one or more series of preferred stock that have voting rights, liquidation preferences, dividend rights and other rights that are superior to those of our common stock. Any issuance of preferred stock could adversely affect the rights of holders of our common stock in that such preferred stock could have priority over the common stock with applicable SEC rulesrespect to voting, dividend or liquidation rights. Further, because we can issue preferred stock having voting rights per share that are greater than the equivalent of one share of our common stock, our Board could issue preferred stock to investors who support us and regulations.our management and give effective control of our business to our management. Additionally, issuance of preferred stock could block an acquisition resulting in both a drop in our "going public" by meansstock price and a decline in interest of a reverse acquisition transaction mayour common stock. This could make it more difficult for usshareholders to obtain coverage from securities analysts of major brokerage firms followingsell their common stock and/or cause the Share Exchange because there may be little incentive to those brokerage firms to recommend the purchasemarket price of our common stock. Further, investment banks may be less likelystock shares to agree to underwrite secondary offerings on our behalf than they might if we became a public reporting company by means of an initial public offering, because they may be less familiar with our company as a result of more limited coverage by analysts and the media, and because we became public at an early stage in our development. The failure to receive research coverage or support in the market for our shares will have an adverse effect on our ability to develop a liquid market for our common stock. The occurrence of any such event could cause our business or stock price to suffer.

If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent material misstatements.

The SEC, as required by Section 404 of the Sarbanes-Oxley Act of 2002, adopted rules requiring every public company to include a management report on such company's internal controls over financial reporting in its annual report, which contains management's assessment of the effectiveness of our internal controls over financial reporting.  Our management may conclude that our internal controls over our financial reporting are not effective.  Moreover,drop significantly, even if our management concludes that our internal controls over financial reporting are effective, our independent registered public accounting firm may issue a report thatbusiness is qualified if it is not satisfied with our controls or the level at which our controls are documented, designed, operated or reviewed.  Our reporting obligations as a public company will place a significant strain on our management, operational and financial resources and systems for the foreseeable future.  Effective internal controls, particularly those related to sales revenue recognition, are necessary for us to produce reliable financial reports and are important to help prevent material misstatements, or in certain extreme cases, fraud.  As a result, our failure to achieve and maintain effective internal controls over financial reporting could result in the loss of investor confidence in the reliability of our financial statements, which in turn could harm our business and negatively impact the trading price of our stock. Furthermore, we anticipate that we will incur considerable costs and use significant management time and other resources in an effort to comply with Section 404 and other requirements of the Sarbanes-Oxley Act.performing well.

ITEM 1B. Unresolved Staff Comments.UNRESOLVED STAFF COMMENTS.

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, the Company is not required to provide the information required by this Item.Not applicable.

ITEM 2. Properties.PROPERTIES

Effective December 1, 2018, Mount Tam rents office space at 106 Main Street, Suite 4E, Burlington, VT 05401. The rental agreement expires November 30, 2019. The Company believes that its facilities are sufficient to meet its current needs and the Company will look for suitable additional space as and when needed.

None.

Effective March 1, 2017 Mount Tam rented office space at 7250 Redwood Blvd, Suite 300, Novato, CA 94945. The rental agreement expired November 30, 2018.

  Prior to March 1, 2017, Mount Tam rented office and laboratory spaces from The Buck Institute at Buck Institute 8001 Redwood Boulevard, Novato, California. Originally Mount Tam was under a lease that provided for an annual rental payment of $24,500 plus $2,000 per year for administrative services, however, the agreement was amended in September 2015 to reduce the annual rental payment to $9,500. In 2016, The Buck Institute billed the Company $9,875 for office space fees plus a $2,000 administration fee, for a total of $11,875 for office space and administration services. In 2017, The Buck Institute billed the Company $0 for office space fees, and $0 administration fee, for a total of $0 for office space and administration services. For the fiscal year ended December 31, 2016, the Company paid $13,199 to The Buck Institute for office space, which includes $2,125 of expense from 2015. For the fiscal year ended December 31, 2017, the Company paid $0 to The Buck Institute for office space, which includes $0 of expense from 2016.  For the fiscal year ended December 31, 2018, the Company paid $0 to The Buck Institute for office space.

ITEM 3. Legal Proceedings.LEGAL PROCEEDINGS.

From time-to-time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. As of the date of this Report, the Company was not involved in any material legal proceedings, nor has it been involved in any such proceedings that have had or may have a significant effect on the Company. The Company iswe are not aware of any other pending or threatened lawsuits that could reasonably be expected to have a material legal proceedings.effect on the results of our operations and there are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

ITEM 4. Mine Safety Disclosures.MINE SAFETY DISCLOSURES.

Not applicable.

Not Applicable

PART II

ITEM 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Market Information

The registrant'sOur common stock is not listed on any stocksecurities exchange, and is quoted on the OTC Markets (OTC Pink)Pink Market under the symbol "MNTM."“FRTM.” Because our common stock is not listed on a securities exchange and its quotations on OTC Pink are limited and sporadic, there is currently no established public trading market for our common stock.

The following table reflects the high and low closing sales information for our common stock for each fiscal quarter during the fiscal years ended December 31, 20182021 and 2017.2020. This information was obtained from OTC Pink and reflects inter-dealer prices without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

Holders

As of April 1, 2019,March 10, 2022, there were approximately 98133 shareholders of record of the Company'sCompany’s common stock based upon the records of the shareholders provided by the Company'sCompany’s transfer agent. The Company'sCompany’s transfer agent is VStock Transfer, LLC, whose address is 18 Lafayette Place, Woodmere, New York 100598,11598, and whose telephone number is (212) 828-8436.

DividendsDividend Policy

The Company has never paid cash dividends on its common stock.  The Companystock, and currently intends to keep futureretain all our cash and any earnings if any, to finance the expansion of its business. The Company doesfor use in our business and, therefore, do not anticipate thatpaying any cash dividends will be paid in the foreseeable future. The Company'sAny future paymentdetermination to pay cash dividends on our common stock will be at the discretion of dividends, if any,the Board and will depend on its earnings,be dependent upon our consolidated financial condition, results of operations, capital requirements expansion plans, financial condition andand/or such other relevant factors thatas the Company's board of directors may deem relevant.  The Company's retained earnings deficit currently limits its ability to pay dividends.Board deems relevant.

Repurchases

During the fiscal year ended December 31, 2018, we did not repurchase any of our securities.

Options

The Company's Board of Directors approved the adoption of the Mount Tam 2016 Stock-Based Compensation Plan (the "2016 Plan") on May 12, 2016.  A majority of the stockholders approved the 2016 Plan by written consent on June 27, 2016.  A copy of the 2016 Plan is included as Exhibit A to the Company's Information Statement filed with the SEC on July 11, 2016.

  On May 2, 2016, the Company granted options to purchase up to 6,330,000 shares of Common Stock under the Plan in the aggregate, with an exercise price of $0.59 per share. On December 28, 2018, the Company granted options to purchase up to 4,910,000 shares of Common Stock under the Plan in the aggregate, with an exercise price of $0.02 per share. Options will vest as per below tables:

  On October 2, 2016, the Company granted options to purchase up to 135,000 shares of Common Stock under the Plan in the aggregate, with an exercise price of $0.40 per share. On December 28, 2018, the Company granted options to purchase up to 435,000 shares of Common Stock under the Plan in the aggregate, an exercise price of $0.02 per share. Options will vest as per below tables:

Stock-based compensation expense related to vested options was $980,909 for the twelve months ended December 31, 2018.  Stock-based compensation expense related to vested options was $981,875 for the twelve months ended December 31, 2017. The Company determined the value of share-based compensation using the Black-Scholes fair value option-pricing model using the following weighted average assumptions for options granted during the year ended December 31, 2018.

As summary of option activity under the 2016 Plan as of December 31, 2018, and changes during the period then ended is presented below:

As of December 31, 2018, there was $1,083,068 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the Plan. That cost is expected to be recognized over a weighted-average period of 2.0 years.

Warrants

On August 10, 2017, the Company entered into a Securities Purchase Agreement with two investors to purchase from the Company 4,038,462 shares of the Company's common stock for an aggregate purchase price of $525,000. (See Note 6 Capital Stock – Private Placement.) The investors received a warrant to purchase an additional 504,808 shares at an exercise price of $0.15 per share, and a warrant to purchase an additional 504,808 shares at an exercise price of $0.20 per share. Both warrants have a call provision when the Company's common stock trades for five consecutive days at a price equal or greater than 500% of the exercise price of each warrant agreement. Both warrant agreements expire August 10, 2022.

RecentUnregistered Sales of Unregistered Securities; Use of Proceeds from RegisteredEquity Securities

Pursuant to the Research Collaboration and License Agreement dated August 17, 2014 with Buck Institute for Research on Aging (the “Buck Institute”), the Company agreed to allow the Buck Institute to maintain a certain common stock equity interest in the Company.  On December 27, 2018, the Company issued 110,000 shares of common stock to the Buck Institute pursuant to such agreement.  The Company did not receive proceeds from such issuance.  Such securities were issued in reliance upon an exemption from registration under Section 4(a)(2) of the Securities Act.None.

Our reliance upon Section 4(a)(2) of the Securities Act of 1933 was based in part upon the following factors: (a) the issuance of the securities was in connection with an isolated private transaction which did not involve any public offering; (b) there were a limited number of offerees; (c) there were no subsequent or contemporaneous public offerings of the securities by us; (d) the securities were not broken down into smaller denominations; and (e) the negotiations for the sale of the securities took place directly between the offeree and the placement agent or the Company, as applicable.  

ITEM 6. Selected Financial Data.SELECTED FINANCIAL DATA.

Not applicable.

ITEM 7. Management's DiscussionMANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Company Overview

On March 18, 2021, prior to the expiration of its exemption from the Investment Company Act of 1940, the Company formed Norr as its wholly owned subsidiary through which the Company commenced its operations as an early-stage manufacturer and Analysisretailer of Financial Conditionsporting goods and Resultsapparel. Norr’s present focus is on online sales but may seek to expand to physical locations in the future, either directly or as a wholesale distributor. On May 18, 2021, the Company changed its name to “Fortium Holdings Corp.”

In September 2021, the Company formed Elysian Premium Corp., a Colorado corporation (“Elysian”) in order to enter into the cannabis industry. On September 14, 2021, the Company and Elysian entered into a Stock Purchase Agreement (“SPA”) with Treehouse Company, Inc. (“Treehouse”), and its sole shareholder Alex Gosselin (the “Seller”) pursuant to which Elysian agreed to purchase 80% of Operationsthe capital stock of Treehouse from the Seller for $200,000. Treehouse’s key assets consist of two licenses for commercial cannabis distribution in the State of California. The acquisition of Treehouse will close upon the delivery of the $200,000 purchase price into escrow to be held until release upon receipt of the requisite regulatory approvals. As of March 10, 2022, the acquisition has not closed. The anticipated Treehouse acquisition is currently pending application for regulatory approval, the receipt of which is a post-closing condition, and should we and the Seller fail to obtain the requisite approval from state and local authorities to the transfer of the two Treehouse licenses to Elysian, the SPA will terminate, the transaction will be reversed, Elysian will return the Treehouse capital stock to the Seller and the Seller will return the $200,000 purchase price to Elysian.

Elysian and the Seller also entered into a Memorandum of Understanding with Treehouse pursuant to which the parties agreed that Elysian will purchase the remaining 20% of the capital stock of Treehouse for an additional $200,000 and enter into a second SPA on substantially similar terms to the SPA in connection therewith, subject to state and local regulatory clearance of the transfer of ownership of the two cannabis licenses owned by Treehouse.

In December 2021, Elysian, the Company, 7Seeds, and Firebreak entered into the JVA pursuant to which the parties agreed to cooperate in the opening and operation of cannabis distribution facilities with (i) 7Seeds agreeing to provide consulting services to Elysian for an initial term of 36 months in connection with the Elysian Stores, and (ii) Firebreak agreeing to grant Elysian an exclusive license to use the CannaBlue Marks with respect to such Elysian Stores, subject to certain exceptions and limitations for an initial term of five years. In exchange for the license Elysian has agreed to pay Firebreak a $5,000 annual license fee, and a quarterly royalty fee equal to the greater of 6% of gross sales or $5,000 for each Cannablue-branded Elysian Store that did not directly result from the consulting services of 7Seeds. In exchange for the consulting services, Elysian has agreed to pay 7Seeds a monthly fee beginning at $5,000 to incrementally increase to up to $15,000 during the initial term of the services. Further, for each Elysian Store for which 7Seeds directly assists in obtaining a cannabis license (exclusive of California license numbers C11-0000999 and C9-0000379), Elysian has agreed to pay 7Seeds a one-time issuance of $50,000 of shares of Fortium common stock and a quarterly royalty fee of 6% of gross sales.

In December 2021, Norr entered into five-year Advisory Agreements with three independent contractors pursuant to which Norr agreed to pay each advisor $1,000 per month for the first eighteen months immediately following execution of the Advisory Agreement. In addition to the cash compensation, the Company agreed to pay equity compensation in the form of equity in Norr and Fortium if certain thresholds are met during the term.

During the fiscal year ended December 31, 2021, we also sold shares of common stock in Ecoark and intend to use the proceeds to pay the purchase price for the Treehouse acquisition, and may use the remaining proceeds, if any, to fund our operations or identify an acquisition target and negotiate and consummate a subsequent transaction. Other than Treehouse, we have not identified an acquisition target as of the date of this Report and intend to further develop our cannabis operations through the transactions contemplated under the Treehouse SPA and 7Seeds and Firebreak JVA, and our Norr operations through the Advisory Agreements.

We have no revenue, have incurred losses since inception and our only asset is cash received from the sale of shares of common stock of Ecoark which we acquired in March 27, 2020 in exchange for the sale of our operating subsidiaries. Prior to that transaction, we were engaged in providing equipment and services to businesses in the oil and gas industry, but in connection with the transaction, the Company has terminated its operations in the oil and gas industry.

Our principal business objective for the next 12 months is to grow our operations and generate revenue following our entry into the cannabis industry through the anticipated Treehouse acquisition. We also intend to continue our efforts to monetize Norr and may seek a reverse merger target to acquire which if management determines to pursue such a transaction would be focused on businesses located within the United States and/or Canada.

Plan of Operations

The following discussion shouldCompany commenced operations in the online sporting goods and apparel industry in March 2021, and has not generated revenue from continuing operations as of the date of this Report. On September 14, 2021, we entered into the SPA to acquire Treehouse, a commercial cannabis distribution company that owns two cannabis distribution licenses in the State of California. This transaction has not closed yet as we have not deposited the $200,000 purchase price into escrow. We are in process of working with the Seller to obtain the requisite regulatory approval to transfer ownership of the Treehouse licenses to Elysian. Should we fail to obtain approval for the transfer of these licenses, the transaction will be readreversed.

All results related to Banner Midstream are reflected in conjunctiondiscontinued operations. We are in the process of further developing a business plan, including with respect to our audited financial statementsplanned operations in the cannabis industry through the anticipated Treehouse acquisition and the related notesJVA with 7Seeds and Firebreak, and other transactions we may undertake if management deems appropriate. We also intend to expand our Norr operations, and entered into Advisory Agreements with three independent contractors for that appear elsewhere in this annual report. The following discussion contains forward-looking statements that reflectpurpose. We may also resume our plans, estimatessearch for potential business acquisitions or other opportunities, and beliefs. Our actual results could differ materiallyuse the proceeds from those discussedour sales of Ecoark common stock or from one or more financings we may conduct in the forward looking statements. Factors that could cause or contributefuture to such differences include those discussed belowcontinue to establish, develop and elsewhere in this annual report. Words such as "anticipate," "estimate," "plan," "project," "continuing," "ongoing," "expect," "believe," "intend," "may," "will," "should," "could," and similar expressions are used to identify forward-looking statements.

We believe that our assumptions are based upon reasonable data derived from and known aboutgrow our business, and operations and the business and operations of the Company. No assurances are made that actual results of operations ordepending on the results of our future activitiescurrent and planned operations in the cannabis and sporting apparel industries, as well as available capital.

Norr

In March 2021 we procured the services of two consultants who assist with our sporting goods and apparel operations through Norr. Specifically, under the respective consulting agreements one of our consultants provides creative design, photography and sporting goods and apparel industry, in overseeing the development, manufacture, advertising and sale of our products. In December 2021, we terminated the prior consulting agreements and entered into new consulting agreements replacing the compensatory terms with these contractors, and procured the services of a third contractor to assist in marketing and sales efforts, including for Norr’s online and social media presence and brand strategy. Management believes that having an online focus, at least in the short term, will not differ materially from its assumptions. Factors that could cause differences include, but are not limitedallow us to expectedleverage existing online platforms and current market conditions, including an increased demand for the Company's products and services and competition. 

The Share Exchange was treated as a reverse acquisition for financial accounting and reporting purposes.  As such, Mount Tam is treated as the acquirer for accounting and financial reporting purposes while the

Company was treated as the acquired entity for accounting and financial reporting purposes.  Further,contactless transactions as a result of the historical financial statements thatcoronavirus pandemic. Management intends to monitor the evolving market conditions, including the highly competitive nature of the industries in which we operate and the anticipated reopening of retail stores at greater capacities, and may make adjustments to our current business model as an online-only seller as it deems appropriate.

Elysian

Subject to completing the acquisition of Treehouse, including both under the initial SPA and the anticipated subsequent SPA, our planned cannabis operations will initially be focused on physical stores located in California. While we may use the Cannablue Marks, our license to do so is limited to retail locations for Elysian Stores. Under the JVA, we will be reflectedhighly reliant on the services and expertise of 7Seeds to establish an initial presence for our cannabis business, and on the Cannablue brand name. If we are successful and generate sufficient revenue and/or raise the required capital in a financing transaction, we may attempt to expand into other areas to the extent permitted under the JVA.

General

Our Chief Executive Officer has experience in consulting both private and public companies in operational processes, although no assurances can be given that he can identify and implement a viable business strategy or that any such strategy will result in profits. Our ability to effectively develop and implement our business plan may be hindered by risks and uncertainties which are beyond our control, including without limitation, the continued negative effects of the COVID-19 pandemic, geopolitical turmoil, inflation or other adverse developments on the U.S. and global economies. See “Risk Factors” contained in this Report concerning risks involved in our current and planned operations and business plan.

During the next 12-month period we anticipate incurring costs in continuing our operations and developing our business through Norr and Elysian upon the completion of the acquisition of Treehouse and the JVA, as well as filing SEC reports, evaluating and adopting our business plan and search for additional business opportunities. We anticipate using a portion of the proceeds from the sale of Ecoark common stock to fund these costs and to compensate our Chief Executive Officer, and anticipate requiring additional capital, which we may raise from one or more future financings, to compensate our independent contractors, to search for, procure and compensate additional executive officers or other personnel, and to meet our financial obligations including under the SPA and JVA.

Our management anticipates that we may not be able to affect the Treehouse acquisition or may be unable to enter into other business combinations or strategic transactions we may identify, unless we can raise sufficient additional capital through one or more financing transactions due to our limited capital. This lack of capital and business diversification will likely pose a substantial risk in investing in the Company'sCompany for the indefinite future, financial statements filed withbecause it will not permit us to implement and adjust our business plan quickly in the SECshort-term, or offset potential losses from one venture or operating territory against gains from another. The risks we face will likely be heightened to the extent we are unable to obtain funding on favorable terms and/or our operations are limited to a small number of industries or geographical regions due to lack of sufficient capital, contractual or regulatory restrictions or other reasons.

We expect that the anticipated acquisition of Treehouse and establishment of cannabis stores through the JVA, and our resulting operations in the cannabis industry will be thosecomplex and risk-prone process, including due to the complex and comprehensive regulatory environment we will face as well as our reliance on third parties in that and other respects. For example, to operate the Treehouse licenses as intended, we will need regulatory approval from the California Department of Mount Tam,Cannabis Control and similar local authorities on which we will be highly dependent on the action or inaction of Treehouse. The completion of the acquisition and regulatory transfer of the commercial cannabis licenses are in process, and there is a risk that the acquisition will not be completed and the Company's assets, liabilitiesregulatory transfer of the licenses will not be approved. If the acquisition is completed and the transfer is not approved, we will reverse this transaction, and we will be forced to begin anew in our search for a new business to acquire, which would have a material adverse effect on our business and results of operationsoperations. Similarly, with respect to the JVA, we will be consolidatedreliant on 7Seeds’ services and expertise and Firebreak’s intellectual property rights and branding with respect to the Elysian Stores and Cannablue Marks, as well as maintaining relationships with these parties.

Further, cannabis remains illegal at the federal level although to date the federal government has elected not to enforce these regulations and instead to allow state governments to regulate the cannabis industry. See the Risk Factors under “Risks Related to our Planned Operations in the Cannabis Industry” beginning on page 8 for more information on the regulatory environment we will face if the Treehouse acquisition closes.

Results of Operations For the Year Ended December 31, 2021 compared with the assets, liabilitiesYear Ended December 31, 2020

With our Norr operations commencing in March 2021 and our Elysian business still in the development stage as of the date of this Report, we expect that our operating revenues, cost of revenues, and operating expenses will increase in 2022 and beyond from what they have been in the past two years ended December 31, 2021 and 2020, particularly if we are able to raise the required capital, close the acquisition of cannabis licenses and open one or more cannabis retail stores in California as planned. The comparison in our results of operations of Mount Tam.  Accordingly, for clarity and continuity, we are presenting the historical financial statements for Mount Tamwere for the periods presented.

Overview

We are an early stage company primarily engagedCompany in the developmentvery preliminary stages of bio-pharmaceuticals to treatoperations of these respective businesses.

Revenue, Cost of Revenue and Gross Profit

The Company did not generate any revenues or gross profits, nor did we incur any cost of revenues for the years ended December 31, 2021 and 2020 as a range of disease areas with high unmet need. Our lead program is focused on SLE, and we intend to optimize and bring to market a portfolio of leading products focused on improving the health and well-being of millions of people who have been affected by a range of serious disease conditions. To that end, we have formed a strategic partnership with the Buck Institute, an independent research facility focused on understanding the connection between aging and chronic disease. As part of the partnership, we have signed the License Agreement that includes many of the Buck Institute's intangible research and development assets. The initial focusresult of our researchdiscontinued operations of Banner Midstream.

Operating Expenses

Included in continuing operations, we incurred operating expenses of $1,361,466 and development efforts will be a preclinical stage compounds for$482,712 during the treatmentyears ended December 31, 2021 and 2020, respectively. The operating expenses in 2021 and 2020 were mainly due to the professional fees related to $905,771 and $205,000 in stock-based compensation in 2021 and 2020 respectively, and the Company’s Exchange Act filings and general operating expenditures of SLE, a serious form of lupus with potential in treating cancers and neurodegenerative disorders as well.

Plan of Operations

As shown in the accompanying consolidated financial statements,running the Company incurred net lossesafter the divestiture of $1,827,789 forBanner Midstream. All operating expenses related to Banner Midstream are included in discontinued operations in the year ended December 31, 20182020.

Other Income (Expense)

Other income (expense) included in continuing operations were ($918,542) and has an accumulated deficit of $8,977,593 as of$1,448,100 during the years ended December 31, 2018.2021 and 2020, respectively. The Company has included ($1,283,502) and $1,276,150 in unrealized gains, respectively related to the investment in the Ecoark common stock received in the sale of Banner Midstream to Ecoark, and $365,005 and $173,429 in realized gains on the sale of Ecoark common stock in the year ended December 31, 2021 and 2020, respectively. In addition, we incurred ($45) and ($1,479) in interest expense related to the Junior Secured Promissory Note.

Net Income (Loss)

During the years ended December 31, 2021 and 2020, we recorded a net income (loss) of ($2,280,008) and $7,317,761, respectively. Of these amounts $0 and $6,352,373 relate to the income (loss) from discontinued operations.

Liquidity and Capital Resources

OurHistorically, our principal sources of cash have been proceeds from private placements of common stock and incurrence of debt. As of December 31, 2018,2021, the Company had working capitalan accumulated deficit of $2,121,795 with cash balance$3,963,543. As of $57,641. Our cash increased by $11,559 during the year ended December 31, 2018. 

During the second quarter of 2016February 24, 2022, the Company entered into negotiations with the Buck Institute to resolve certain outstanding financial concerns, and to broaden the Research Collaboration and License Agreement beyond the area of autoimmune disease.  On July 18, 2016, Mount Tam Biotechnologies, Inc. (the "Company"), entered into an amendment (the "Amendment") to the Research Collaboration and License Agreement (the "License Agreement") between the Company and The Buck Institute for Research on Aging ("The Buck Institute").

Pursuant to this Amendment, the Research Collaboration Termhas sold all of the License Agreement is tolled until the Company can achieve a Qualified Financing (defined as any financing occurring after the dateshares of the Amendment which resultsEcoark and received $1,079,730 in gross proceeds therefrom.

We anticipate that among the most critical challenges we will need to overcome in order to establish our planned operations for our new focus in the Company of at least $2,000,000). Once a Qualified Financing has been achieved, the research collaboration efforts will resume, and will continue for a period of twenty-one months (the "Extended Research Collaboration Term"). The Company and The Buck Institute agreed to work together to determine a new research plan, specifying the research and development activities of both parties during the Extended Research Collaboration Term.

Additionally, pursuant to the Amendment, the parties agreed to settle past research funding amounts owed by the Company to The Buck Institute. The Company agreed to pay $40,000 within ten days of the execution of the Amendment, and The Buck Institute agreed that once this amount is paid, the Companycannabis industry will be deemedto raise sufficient capital to establish our initial Elysian Store or Stores. While for the past 12 months we have used the proceeds from sales of Ecoark common stock we held to fund our operations, which were more limited than those currently planned, as of March 1, 2022, we have sold the remaining shares of Ecoark common stock we held, and any additional capital will therefore need to be in full compliance withraised from the termssale and issuance of our common stock or other securities, which may include the License Agreement,incurrence of indebtedness by us. 

In the future, we will need to consummate one or more capital raising transactions, including its payment obligations. On July 19, 2016, the Company made the $40,000 paymentpotential debt or equity issuances, and/or generate material revenue from Norr, Elysian or another operating business or businesses we may form or acquire to The Buck Institute.  In additioncontinue to the $40,000 payment, on June 13, 2016, the Company paid to The Buck Institute $11,706 in connection with costs incurred to further the Company's intellectual property position under the License Agreement. Pursuant to the above amendment The Buck Institute waived $274,247 of payable by the Company. In addition, the Company issued to Buck Institute 1,009,016fund our operations. We may also issue shares of common stock, which was the number of shares requiredstock options or other derivative securities to equal to 5% of the Company's total outstanding shares. Pursuantcompensate our employees or independent contractors, including pursuant to the original License Agreement,consulting agreements for our Norr and Elysian operations. We will need additional capital to fund our anticipated acquisition of Treehouse, including both for the second Treehouse SPA which has not been executed, working capital, and to meet our operational obligations in our planned cannabis business such as compensatory arrangements and royalty fee payments.

We expect to utilize any capital raising to run our operations for Norr and Elysian. We expect our cash outlays to be much greater than the past two years ended December 31, 2021 and 2020, and to invest heavily in these businesses. The only known future commitments that we have as of March 10, 2022 relate to the JVA and the Amendment, The Buck Institute's equity interestAdvisory Agreements we entered into in December 2021 and the Treehouse SPA entered into in September 2021 as fully described in the Company will not be reduced below 5% of the total aggregate shares of common stock until such time that the Company has raisedManagement’s Discussion and received a total of $5,000,000 of investment in equity, debt, grants, contributions, or donations. As of December 31, 2018, the Company has issued 2,754,272 shares of the Company's common stock to The Buck Institute.

Analysis herein as well as our Consolidated Financial Statements.

Moreover, the parties agreed that the field of use covered

Net Cash used by the License Agreement would be expanded, with the new definition being "the treatment, diagnosis or prevention of any and all conditions or diseases including, without limitation, systemic lupus erythematous and multiple sclerosis for human and/or veterinary use." (Under the original License Agreement, the Company's field of use had been restricted to autoimmune disorders). The foregoing is qualified in its entirety to the terms of the Amendment, a copy of which was filed as Exhibit 99.1 to our Form 8-K filed on July 21, 2016.Operating Activities:

Negative Operating Cash Flow

We reported negative cash flow from operations related to our continuing operations for the yearyears ended December 31, 20182021 and 2017.2020 in the amount of $(543,394) and $(199,974), respectively. It is anticipated that we will continue to report negative operating cash flow in future periods, likely until one or more of our products are placed into productionas to date we have formed two new subsidiaries during the fiscal year ending December 31, 2021 and releasedhave incurred and will continue to our customers.incur start-up costs to develop these entities and their respective businesses.

OurCash Flows from Investing Activities:

We had net cash balance of $57,641 may not be sufficient to fund ourprovided from investing activities from continuing operations for at least the next 12 months. Additionally, if we are unable to generate sufficient revenues to pay our expenses, we will need to raise additional funds to continue our operations. We have historically financed our operations through private equity and debt financings. Recent economic turmoil and lack of liquidity in the debt capital markets together with high volatility in prices in the equity capital markets have severely and adversely affected capital raising opportunities. We do not have any commitments for financing at this time, and financing may not be available to us on favorable terms, if at all. If we are unable to obtain debt or equity financing in amounts sufficient to fund our operations, if necessary, we will be forced to suspend or curtail our operations. In that event, current stockholders would likely experience a loss of most or all of their investment. Additional funding that we do obtain may be dilutiverelated to the interestsproceeds received from the sale of existing stockholders.

Resultsthe shares of Operations

For the Year ended December 31, 2018 compared with the Year ended December 31, 2017

Revenue

We had no revenues for the year ended December 31, 2018 and 2017. We areEcoark common stock we hold in the research and development stage.

Operating Expenses

We incurred operating expenses of $1,816,691 and $2,530,790 during the year ended December 31, 2018 and 2017, respectively. Our operating expenses included research and development expenses2021 in the amount of $456,955$800,994 and $688,668, and general and administrative expenseshad $240,625 in 2020. We also purchased fixed assets of $2,513 in 2021.

Cash Flows from Financing Activities:

For the amount of $1,359,736 and $1,842,122 for yearyears ended December 31, 20182021 and 2017 respectively. The decrease2020, the only cash flows from financing activities related to the payments of the Junior Secured Promissory Note in generalconnection with our continuing operations, and administrative expenses was mainly due to a decrease in legal and consulting expenses.

Other Income (Expense)

Other income was $332,801 and $534 duringcash provided by financing activities from proceeds received from our Chief Executive Officer for working capital purposes. During the yearyears ended December 31, 2018 and 2017, respectively. The increase is directly related to the sale of our subsidiary in October 2018.  Other expenses included interest expense in the amount of $54,771 and $19,321. The increase in interest expense is related to the additional convertible secured debt the Company added in 2018. Additionally, other expense includes amortization of debt discount in the amount of $289,128 and $66,520 for the year ended December 31, 2018 and 2017, respectively. The increase in amortization of debt discount is related to the additional convertible secured debt the Company added in 2018.

Net Loss

As a result2021, we repaid $22,500 of the foregoing, duringJunior Secured Promissory Note and had received and repaid $10,000 from the year ended December 31, 2018Chief Executive Officer and 2017, we recorded a net lossreceived $14,000 from the exercise of $1,827,789 and $2,616,097, respectively.