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

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

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

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

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

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12(b)-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date. At February ~~15, 2018,~~19, 2021, the registrant had outstanding ~~38,244,520~~74,513,514 shares of common stock.

For the three and six months ended December 31, ~~2017~~2020 and ~~December 31, 2016~~2019

~~NightFood~~Nightfood Holdings, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

	December 31,			June 30,			December 31,			June 30,
	2017			2017			2020			2020
	(Unaudited)						(Unaudited)
ASSETS

Current assets :
Current assets:
Cash	$	12,322		$	14,326		$	117,538		$	197,622
Accounts receivable (net of allowance of $0 and $0, respectively)		321			382
Inventory		10,115			95,865
Accounts receivable – net								41,290			61,013
Inventories								166,041			275,605
Other current assets		74,968			3,491			212,226			398,085
Total current assets		97,726			114,064			537,095			932,325

Total assets	$	97,726		$	114,064		$	537,095		$	932,325

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	229,897		$	205,961		$	1,140,205		$	1,286,149
Accrued expense-related party		192,000			180,000			9,974			9,974
Accrued expense								56,923			-
Accrued interest								248,492			192,625
Short term borrowings – line of credit								1,692			3,897
Convertible notes payable – net of discount		418,992			151,020			2,551,104			2,330,189
Fair value of derivative liabilities		1,016,453			44,022			1,416,045			1,590,638
Short-term borrowings		2,000			3.096
Advance from shareholders		11,795			995
Total current liabilities		1,871,137			585.094		$	5,424,435			5,413,472

Commitments and contingencies		-			-			-			-

Stockholders’ deficit:
Common stock, ($0.001 par value, 200,000,000 shares authorized, and 35,368,758 issued and outstanding as of December 31, 2017 and 29,724,432 outstanding as of June 30, 2017, respectively)		35,369			29,724
Preferred stock, ($0.001 par value, 1,000,000 shares authorized, and 1,000 issued and outstanding as of December 31, 2020 and 1,000 outstanding as of June 30, 2020, respectively)								1			1
Common stock, ($0.001 par value, 200,000,000 shares authorized, and 68,886,863 issued and outstanding as of December 31, 2020 and 61,796,680 outstanding as of June 30, 2020, respectively)								68,887			61,797
Additional paid in capital		3,790,954			2,880,467			14,217,423			13,088,177
Accumulated deficit		(5,599,734	)		(3,381,221	)		(19,173,651	)		(17,631,122	)
Total stockholders’ deficit		(1,773,411	)		(471,030	)		(4,887,339	)		(4,481,147	)
Total Liabilities and Stockholders’ Deficit	$	97,726		$	114,064		$	537,095		$	932,325

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-1

~~NightFood~~Nightfood Holdings, Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

For the six months ended December 31,
2017 For the six months ended December 31,
2016 For the three months ended December 31,
2017 For the three months ended December 31,
2016
Revenues $ 108,726 $ 10,507 $ 72,284 $ 8,043

Operating expenses
Cost of product sold 85,429 15,246 59,403 3,145
Advertising and promotional 102,372 1,058 60,548 438
Selling, general and administrative 315,984 18,031
172,644
5,755
Professional Fees 472,782 129,372 215,542 83,040
Total operating expenses 976,567 163,707
508,137
92,378

Loss from operations (867,841 ) (153,200 ) (435,853 ) (84,335 )

Interest expense – bank debt - 338 - 37
Interest expense - shareholder 3,988 5,000 1,257 -
Change in derivative liability 250,465 - 147,546 -
Interest expense - other 444,441 - 190,936 -
Other expense 651,778 -
463,146
-
Total other expense 1,350,672 5,338
802,885
37

Provision for income tax - - - -

Net loss $ (2,218,513 ) $ (158,538 ) $ (1,238,738 ) $ (84,372 )

Basic and diluted net loss per common share $ (0.07 ) $ (0.01 ) $ (0.04 ) $ (0.00 )

Weighted average shares of capital outstanding – basic and diluted 31,846,459 28,552,706 33,172,996 28,585,220

	For the three months ended December 31, 2020			For the three months ended December 31, 2019			For the six months ended December 31, 2020			For the six months ended December 31, 2019
Revenues	$	47,210		$	61,285		$	174,193		$	107,782

Operating expenses
Cost of product sold		110,465			48,475			340,161			194,975
Selling, general and administrative		398,964			644,569			832,293			672,676
Amortization of intangibles		-			166,666			-			333,333
Total operating expenses		509,429			859,710			1,172,454			1,200,984

Loss from operations		(462,219	)		(798,425	)		(998,261	)		(1,093,202	)

Interest expense – bank debt		338			-			675			-
Interest expense - shareholder		125,575			15,738			209,530			42,336
(Gain)/loss on extinguishment of debt upon notes conversion		(186,181	)					2,216			-
Change in derivative liability		(57,294	)		(165,563	)		(264,818	)		(355,625	)
Interest expense - other		254,048			449,169			576,787			831,436
Other expense- non cash		-			39,173			19,877			39,173
Total other expense		136,486			338,517			544,267			557,320

Provision for income tax		-			-			-			-

Net loss	$	(598,705	)	$	(1,136,942	)	$	(1,542,528	)	$	(1,650,522	)

Basic and diluted net loss per common share	$	(0.01	)	$	(0.02	)	$	(0.03	)	$	(0.03	)

Weighted average shares of capital outstanding – basic and diluted		66,744,545			56,167,120			65,093,781			55,324,416

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-2

Nightfood Holdings, Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

For the three and six months ended December 31, 2020 and 2019

	Common Stock				Preferred Stock				Additional Paid-in			Accumulated			Total Stockholders’
	Shares		Par Value		Shares		Par Value		Capital			Deficit			Deficit
Balance, June 30, 2019		53,773,856	$	53,774		1,000	$	1	$	10,692,679		$	(13,219,059	)	$	(2,472,605	)
Common stock issued for services		122,762		123		-		-		49,274			-			49,397
Common stock issued for interest		110,404		110						26,487			-			26,597
Issuance of common stock for debt conversion		1,409,349		1,409						335,591			-			337,000
Derivative liability reclassed upon debt conversion		-		-						213,739			-			213,739
Net loss		-		-		-		-		-			(513,580	)		(513,580	)
Balance, Three Months as of September 30, 2019		55,416,371	$	55,416		1,000	$	1	$	11,317,770		$	(13,732,639	)	$	(2,359,452	)
Common stock issued for services		85,000		85		-		-		21,415			-			21,500
Common stock issued for interest		107,227		107						15,632			-			15,739
Issuance of common stock for debt conversion		1,500,495		1500						218,500			-			220,000
Derivative liability reclassed upon debt conversion		-		-						128,605			-			128,605
Net loss		-		-		-		-		-			(1,136,941	)		(1,136,941	)
Balance, Three Months as of December 31, 2019		57,109,093	$	57,109		1,000	$	1	$	11,701,922		$	(14,869,580	)	$	(3,110,548	))

Balance, June 30, 2020		61,796,680	$	61,797		1,000	$	1	$	13,088,177		$	(17,631,122	)	$	(4,481,147	)
Common stock issued for interest		312,938		313						36,165			-			36,478
Issuance of common stock for debt conversion		2,975,979		2,976						344,024			-			347,000
Issuance of warrants										65,711						65,711
Loss on fair value of shares issued upon debt conversion		-		-						397,532			-			397,532
Net loss													(943,824	)		(943,824	)
Balance, Three Months as of September 30, 2020		65,085,597	$	65,086	$	1,000	$	1	$	13,931,609			(18,574,946	)	$	(4,578,250	)
Common stock issued for services		583,914		584						88,089						88,673
Common stock issued for interest		336,132		336						24,672			-			25,008
Issuance of common stock for debt conversion		2,881,220		2,881						212,119			-			215,000
Loss on fair value of shares issued upon debt conversion		-		-						(39,065	)		-			(39,065	)
Net loss													(598,705	)		(598,705	)
Balance, Three Months as of December 31, 2020		68,886,863	$	68,887	$	1,000	$	1	$	14,217,423		$	(19,173,651	)	$	(4,887,339	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-3

~~NightFood~~Nightfood Holdings, Inc.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the six months ended December 31, 2017			For the six months ended December 31, 2016			For the six months ended December 31, 2020			For the six months ended December 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(2,218,513	)	$	(158,538	)	$	(1,542,528	)	$	(1,650,522	)
Adjustments to reconcile net loss to net cash used in operations activities:
Warrants issued for services								65,711			-
Stock issued for services		260,156			51,500			88,673			70,897
Stock issued for conversion of debt		117,000			-
Stock issued as part of loan agreement		3,988			5,000
Amortization of debt discount and deferred financing fees		679,714			-
Stock issued for interest								-			42,336
Amortization of debt discount								576,787			831,436
Deferred financing fees and financing cost								112,604			39,173
Change in derivative liability		250,465			-			(264,818	)		(355,625	)
Change decrease in accounts receivable		61			(9,677	)
Loss on extinguishment of debt upon notes conversion								2,216			-
Amortization of intangible assets								-			333,333
Change in operating assets and liabilities
Change in accounts receivable								19,723			(9,049	)
Change in inventory		85,750			11,611			109,564			31,916
Change in other current assets		(71,475	)		1,400			185,859			(409,334	)
Change in accounts payable		23,937			33,071			(145,947	)		199,876
Change in accrued expenses		12,000			36,000			174,277			(24,000	)
Net cash used in operating activities		(856,917	)		(29,633	)		(617,879	)		(899,563	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for purchase of intangible assets								-			(333,333	)
Net cash used in investing activities								-			(333,333	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from the sale of stock		36,117			10,000
Proceeds from the issuance of debt-net		884,093			-			540,000			1,350,000
Advance from shareholders		10,800			21,984
Advance from related party		-			28
Repayment of short-term debt		(1,096	)		(1,464	)
Repayment of related party advance		-			(1,000	)
Repayment of convertible debt		(75,000	)		-
Repayment on line of credit								(2,205	)		-
Net cash provided by financing activities		854,914			29,548			537,795			1,350,000

NET (DECREASE) IN CASH AND CASH EQUIVALENTS		(2,004	)		(86	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS								(80,084	)		117,104

Cash and cash equivalents, beginning of period		14,326			5,481			197,622			30,142
Cash and cash equivalents, end of period	$	12,322		$	5,396		$	117,538		$	147,246

Supplemental Disclosure of Cash Flow Information:
Cash Paid For:
Interest	$	30		$	301		$	675		$	-
Income taxes	$	-		$	-		$	-		$	-
Summary of Non-Cash Investing and Financing Information:
Debt discount due to beneficial conversion feature	$	871,755		$	-
Value of embedded derivative liabilities	$	101,511		$	-
Initial derivative liability and debt discount							$	373,612		$	1,117,777
Derivative liability reclassed to loss on extinguishment of debt upon notes conversion							$	320,746		$	-
Stock issued for conversion of debt							$	562,000		$	557,000
Stock issued for Interest							$	61,486		$	42,337
True-up adjustment in debt discount and derivative liability							$	37,360		$	-
Intangible assets acquired and adjusted in accounts payable balance							$	-		$	666,666

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

F-4

~~NightFood~~Nightfood Holdings, Inc.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.	Description of Business	~~NightFood~~	Nightfood Holdings, Inc. (the “Company”) is a Nevada Corporation organized October 16, 2013 to acquire all of the issued and outstanding shares of ~~NightFood,~~Nightfood, Inc., a New York Corporation from its sole shareholder, Sean Folkson. All of its operations are conducted by ~~the subsidiary, NightFood,~~its two subsidiaries: Nightfood, Inc. ~~The Company’s~~(“Nightfood”) and MJ Munchies, Inc. (“Munchies”). Nightfood’s business model is to manufacture and distribute snack products specifically formulated for nighttime snacking to help consumers satisfy nighttime cravings in a better, healthier, more sleep friendly way. Management believes Nightfood is the first brand to achieve mainstream distribution of snacks focused on better sleep, and expects the category of “sleep-friendly” snacking to become an important segment of the total snacking market in coming years. Munchies has acquired a portfolio of intellectual property around the brand name Half-Baked, and intends to license said IP to operators in the cannabis edibles space and other related spaces.

		●	The Company’s fiscal year end is June 30.

		●	The Company currently maintains its corporate address in Tarrytown, New York.

2.	Summary of Significant Accounting Policies	●	Management is responsible for the fair presentation of the Company’s financial statements, prepared in accordance with U.S. generally accepted accounting principles (GAAP).

Interim Financial Statements

These unaudited condensed consolidated financial statements ~~as of and~~ for the six (6) months ended December 31, ~~2017~~2020 and ~~2016,~~2019, respectively, reflect all adjustments including normal recurring adjustments, which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows for the periods presented in accordance with the accounting principles generally accepted in the United States of America.

These interim unaudited condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto for the years ended June 30, ~~2017~~2020 and ~~2016,~~2019, respectively, which are included in the Company’s June 30, ~~2017~~2020 Annual Report on Form 10-K filed with the United States Securities and Exchange Commission on October ~~3, 2017.~~13, 2020. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited consolidated financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the three and six ~~(6)~~ months ended December 31, ~~2017~~2020 are not necessarily indicative of results for the entire year ending June 30, ~~2018.~~2021.

~~For comparability purposes,~~We made certain ~~figures for the~~reclassifications to prior ~~periods have been reclassified where appropriate~~period amounts to conform towith the ~~financial statement presentation used in~~ current ~~reporting period.~~year’s presentation. These reclassifications ~~had no~~did not have a material effect on ~~reported net loss.~~our condensed consolidated statement of financial position, results of operations or cash flows.

	Use of Estimates	●	The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates are used in the determination of depreciation and amortization, the valuation for non-cash issuances of common stock, and the website, income taxes and contingencies, valuing convertible notes for BCF and derivative liability, among others.

F-5

Cash and Cash Equivalents	●	The Company classifies as cash and cash equivalents amounts on deposit in the banks and cash temporarily in various instruments with original maturities of three months or less at the time of purchase. The Company places its cash and cash equivalents on deposit with financial institutions in the United States. The Federal Deposit Insurance Corporation (“FDIC”) covers $250,000 for substantially all depository accounts. The Company from time to time may have amounts on deposit in excess of the insured limits.

Fair Value of Financial Instruments	●	Statement of financial accounting standard FASB Topic 820, Disclosures about Fair Value of Financial Instruments, requires that the Company disclose estimated fair values of financial instruments. The carrying amounts reported in the statements of financial position for assets and liabilities qualifying as financial instruments are a reasonable estimate of fair value.


Inventories	●	Inventories consisting of packaged food items and supplies are stated at the lower of cost (FIFO) or ~~market,~~net realizable value, including provisions for spoilage commensurate with known or estimated exposures which are recorded as a charge to cost of sales during the period spoilage is incurred. The Company has no minimum purchase commitments with its vendors.

Advertising Costs	●	Advertising costs are expensed when incurred and are included in advertising and promotional expense in the accompanying statements of operations. Although not traditionally thought of by many as “advertising costs”, the Company includes expenses related to graphic design work, package design, website design, domain names, and product samples in the category of “advertising costs”. The Company ~~incurred~~recorded advertising costs of ~~$102,372~~$252,325 and ~~$1,058~~$661,633 for the six months ended December 31, ~~2017~~2020 and ~~2016,~~2019, respectively. The Company recorded advertising costs of $67,036 and $463,363 for the three months ended December 31, 2020 and 2019, respectively. Further, as discussed on footnote 3, due to reclassification, $458,639 in expenses were reversed and set off with the advertising costs incurred during 2019."

Income Taxes	●	The Company has not generated any taxable income, and, therefore, no provision for income taxes has been provided.

	●	Deferred income taxes are reported for timing differences between items of income or expense reported in the financial statements and those reported for income tax purposes in accordance with FASB Topic 740, “Accounting for Income Taxes”, which requires the use of the asset/liability method of accounting for income taxes. Deferred income taxes and tax benefits are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and for tax loss and credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company provides for deferred taxes for the estimated future tax effects attributable to temporary differences and carry-forwards when realization is more likely than not.

	●	A valuation allowance has been recorded to fully offset the deferred tax asset even though the Company believes it is more likely than not that the assets will be utilized.

	●	The Company’s effective tax rate differs from the statutory rates associated with taxing jurisdictions because of permanent and temporary timing differences as well as a valuation allowance.

Revenue Recognition	●	The Company generates its revenue by selling its nighttime snack products wholesale to retailers and ~~direct to consumer.~~wholesalers.

		●	All sources of revenue isare recorded pursuant to FASB Topic ~~605~~606 Revenue Recognition, to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This includes a five-step framework that requires an entity to: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when ~~persuasive evidence~~the entity satisfies a performance obligation. In addition, this revenue generation requires disclosure of ~~arrangement exists, delivery~~the nature, amount, timing, and uncertainty of ~~services has occurred, the fee is fixed or determinable~~revenue and ~~collectability is reasonably assured.~~cash flows arising from contracts with customers.

		●	The Company offers sales incentives through various programs, consisting primarily of advertising related credits. The Company records certain advertising related credits with customers as a reduction to revenue as no identifiable benefit is received in exchange for credits claimed by the customer.

F-6

●

The Company revenue from contracts with customers provides that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

The Company incurs costs associated with product distribution, such as freight and handling costs. The Company has elected to treat these costs as fulfillment activities and recognizes these costs at the same time that it recognizes the underlying product revenue. As this policy election is in line with the Company’s previous accounting practices, the treatment of shipping and handling activities under FASB Topic 606 did not have any impact on the Company’s results of operations, financial condition and/or financial statement disclosures.

The adoption of ASC 606 did not result in a change to the accounting for any of the Company’s revenue streams that are within the scope of the amendments. The Company’s services that fall within the scope of ASC 606 are recognized as revenue as the Company satisfies its obligation to the customer.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which updates revenue recognition guidance relating to contracts with customers. This standard states that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This standard is effective for annual reporting periods, and interim periods therein, beginning after July 1, 2018. The Company adopted ASU 2014-09 and its related amendments (collectively known as “ASC 606”) during the first quarter of fiscal 2019 using the full retrospective method.

Management reviewed ASC 606-10-32-25 which states “Consideration payable to a customer includes cash amounts that an entity pays, or expects to pay, to the customer (or to other parties that purchase the entity’s goods or services from the customer). Consideration payable to a customer also includes credit or other items (for example, a coupon or voucher) that can be applied against amounts owed to the entity (or to other parties that purchase the entity’s goods or services from the customer). An entity shall account for consideration payable to a customer as a reduction of the transaction price and, therefore, of revenue unless the payment to the customer is in exchange for a distinct good or service (as described in paragraphs 606-10-25-18 through 25-22) that the customer transfers to the entity. If the consideration payable to a customer includes a variable amount, an entity shall estimate the transaction price (including assessing whether the estimate of variable consideration is constrained) in accordance with paragraphs 606-10-32-5 through 32-13.”

If the consideration payable to a customer is a payment for a distinct good service, then in accordance with ASC 606-10-32-26, the entity should account for it the same way that it accounts for other purchases from suppliers (expense). Further, “if the amount of consideration payable to the customer exceeds the fair value of the distinct good or service that the entity receives from the customer, then the entity shall account for such an excess as a reduction of the transaction price. If the entity cannot reasonably estimate the fair value of the good or service received from the customer, it shall account for all of the consideration payable to the customer as a reduction of the transaction price.”

			Under ASC 606-10-32-27, if the consideration payable to a customer is accounted for as a reduction of the transaction price, “an entity shall recognize the reduction of revenue when (or as) the later of either of the following events occurs:

			a)	The entity recognizes revenue for the transfer of the related goods or services to the customer.

			b)	The entity pays or promises to pay the consideration (even if the payment is conditional on a future event). That promise might be implied by the entity’s customary business practices.”

			Management reviewed each arrangement to determine if each fee paid is for a distinct good or service and should be expensed as incurred or if the Company should recognize the payment as a reduction of revenue.

F-7

		The Company recognizes revenue upon shipment based on meeting the transfer of control criteria. The Company has made a policy election to treat shipping and handling as costs to fulfill the contract, and as a result, any fees received from customers are included in the transaction price allocated to the performance obligation of providing goods with a corresponding amount accrued within cost of sales for amounts paid to applicable carriers.

Concentration of Credit Risk	●	Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash deposits at financial institutions. At various times during the year, the Company may exceed the federally insured limits. To mitigate this risk, the Company places its cash deposits only with high credit quality institutions. Management believes the risk of loss is minimal. At December 31, ~~2017~~2020 and June 30, ~~2017,~~2020, the Company did not have any uninsured cash deposits.

Beneficial Conversion Feature	●	For conventional convertible debt where the rate of conversion is below market value, the Company records any “beneficial conversion feature” (“BCF”) intrinsic value as additional paid in capital and related debt discount. When the Company records a BCF, the relative fair value of the BCF is recorded as a debt discount against the face amount of the respective debt instrument. The discount is amortized over the life of the debt. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is immediately expensed.

Debt Issue Costs	●	The Company may pay debt issue costs in connection with raising funds through the issuance of debt whether convertible or not or with other consideration. These costs are recorded as debt discounts and are amortized over the life of the debt to the statement of operations as amortization of debt discount.

Original Issue Discount	●	If debt is issued with an original issue discount, the original issue discount is recorded to debt discount, reducing the face amount of the note and is amortized over the life of the debt to the statement of operations as amortization of debt discount. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is immediately expensed.

Valuation of Derivative Instruments	●	ASC 815 “Derivatives and Hedging” requires that embedded derivative instruments be bifurcated and assessed, along with free-standing derivative instruments such as warrants, on their issuance date and measured at their fair value for accounting purposes. In determining the appropriate fair value, the Company uses the ~~Black-Scholes~~Trinomial Tree option pricing formula. Upon conversion of a note where the embedded conversion option has been bifurcated and accounted for as a derivative liability, the Company records the shares at fair value, relieves all related notes, derivatives and debt discounts and recognizes a net gain or loss on ~~debt extinguishment.~~derivative liability under the line item “change in derivative liability”.

Derivative Financial Instruments	●	The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks. The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and then is revalued at each reporting date, with changes in fair value reported in the consolidated statement of operations. For stock based derivative financial instruments, Fair value accounting requires bifurcation of embedded derivative instruments such as conversion features in convertible debt or equity instruments, and measurement of their fair value for accounting purposes. In determining the appropriate fair value, the Company uses the ~~Black-Scholes~~Trinomial Tree option-pricing model. In assessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertible debt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventional convertible debt, the Company will continue its evaluation process of these instruments as derivative financial instruments.

		Once determined, derivative liabilities are adjusted to reflect fair value at the end of each reporting period. Any increase or decrease in the fair value from inception is made quarterly and appears in results of operations as a change in fair market value of derivative liabilities.

Stock-Based Compensation

The Company accounts for share-based awards issued to employees in accordance with FASB ASC 718. Accordingly, employee share-based payment compensation is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period. Additionally, share-based awards to non-employees are expensed over the period in which the related services are rendered at their fair value. The Company applies ASC 718, “Equity Based Payments to Non-Employees”, with respect to options and warrants issued to non-employees.

F-8

Customer Concentration	●	During the six months ended December 31, ~~2017,~~2020, the Company ~~did not have any~~had one customer account for ~~more than~~approximately 33% of the gross sales. One other customer accounted for approximately 19% of gross sales, and one other customer accounted for over 10% of gross sales. During the ~~revenue volume.~~ six months ended December 31, 2019, one customer accounted for approximately 34% of the gross sales while two other customers accounted for over 10% of gross sales. During the three months ended December 31, ~~2016,~~2020, the Company had one customer account for approximately 25% of the gross sales. One other customer accounted for approximately 20% of gross sales, and two other customers accounted for over 10% of gross sales. During the three months ended December 31, 2019, one customer accounted for approximately ~~90%~~34% of ~~revenues.~~the gross sales while three other customers accounted for over 10% of gross sales.

Vendor Concentration		During the three-month period ended December 31, 2020, no vendors accounted for more than 10% of our operating expenses. During the six-month ended December 31, 2020, one vendor accounted for more than 10% of our operating expenses. During the three-month period ended December 31, 2019, one vendor accounted for more than 10% of our operating expenses. During the six-month ended December 31, 2019, two vendors accounted for more than 10% of our operating expenses.

Receivables Concentration	●	As of December 31, ~~2017,~~2020, the Company had ~~accounts receivable totaling $321, with one customer. That entire balance remains outstanding as~~receivables due from eight customers. Five of which each accounted for 10% of the ~~time~~total balance. As of ~~this filing.~~June 30, 2020, the Company had receivables due from seven customers, two of whom accounted for over 20% of the outstanding balance. Four of the other five accounted for over 10% of the total balance.

~~Income~~Income/Loss Per Share	●	Net ~~income~~income/loss per share data for both the three and six-month periods ending December 31, ~~2017~~2020 and ~~2016~~2019, are based on net ~~income~~income/loss available to common shareholders divided by the weighted average of the number of common shares outstanding. AsThe Company does not present a diluted Earnings per share as the convertible debt and interest that is convertible into shares of ~~December 31, 2017, there are no outstanding~~the Company’s common stock ~~equivalents.~~would not be included in this computation, as the Company is generating a loss and therefore these shares would be antidilutive.

Impairment of Long-lived Assets	●	The Company accounts for long-lived assets in accordance with the provisions of FASB Topic 360, Accounting for the Impairment of Long-Lived Assets. This statement requires that long-lived assets and certain identifiable intangibles be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. Fair values are determined based on quoted market value, discounted cash flows or internal and external appraisals, as applicable. During the period ended December 31, 2020 and 2019, the Management determined and impaired $-0- and $-0-, respectively as impairment on intangible asset

Reclassification		The Company may make certain reclassifications to prior period amounts to conform with the current year’s presentation. These reclassifications did not have a material effect on its consolidated statement of financial position, results of operations or cash flows.

F-9

Recent Accounting Pronouncements		In January 2016, the FASB issued ASU 2016-01,Financial Instruments – Overall (Subtopic 825-10) – Recognition and Measurement of Financial Assets and Financial Liabilities, which requires all investments in equity securities with readily determinable fair value to be measured at fair value with changes in the fair value recognized through net income (other than those accounted for under the equity method of accounting or those that result in consolidation of the investee). ASU 2016-01 is intended to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information and removes the requirement to disclose the methods and significant assumptions used to estimate the fair value for financial instruments measured at amortized cost on the balance sheet. For public companies, the new standard is effective for annual periods beginning after December 15, 2017, including interim periods within the fiscal year. For all other entities, including emerging growth companies, ASU 2016-01 is effective for annual periods beginning after December 15, 2018, and interim periods within annual periods beginning after December 15, 2019. The Company evaluated the impact on the financial statements and implemented the provisions of ASU 2016-01 for the annual financial statements for the year ended June 30, 2020. This new standard did not have a material impact on our financial statements or related disclosures.

~~Recent Accounting Pronouncements~~	●	In ~~May 2017,~~February 2016, the FASB issued ASU ~~2017-09, Compensation – Stock Compensation. This~~No. 2016-02, Leases (Topic 842) and subsequently amended the guidance relating largely to transition considerations under the standard ~~provides guidance related~~in January 2017, to increase transparency and comparability among organizations by requiring the ~~scope~~recognition of ~~stock option modification accounting,~~right-of-use (“ROU”) assets and lease liabilities on the balance sheet. Most prominent among the changes in the standard is the recognition of ROU assets and lease liabilities by lessees for those leases classified as operating leases under current U.S. GAAP. Under the standard, disclosures are required to ~~reduce diversity in practice~~meet the objective of enabling users of financial statements to assess the amount, timing, and ~~reduce cost~~uncertainty of cash flows arising from leases. We will be required to recognize and ~~complexity regarding~~measure leases existing ~~guidance. This update is~~at, or entered into after, the beginning of the earliest comparative period presented using a modified retrospective approach, with certain practical expedients available. The standard became effective for ~~annual periods~~us beginning ~~after December 15, 2017. Early adoption~~July 1, 2019. We have reviewed this and have determined that there is ~~permitted. The Company does not expect the adoption of ASU 2017-09 to have a~~no material ~~effect~~impact on ~~its consolidated~~our financial statements. In August 2016, the FASB issued “ASU” 2016-15, Statement of Cash Flows – Classification of Certain Cash Receipts and Cash Payments. This standard clarifies how specific cash receipts and cash payments are classified and presented in the statement of cash flows. This update is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2017. Early adoption is permitted. The Company does not expect the adoption of ASU 2016-15 to have a material effect on its consolidated financial statements.

		In ~~May 2014,~~July 2017, the FASB issued ASU ~~2014-09—Revenue~~No. 2017-11, Earnings Per Share, Distinguishing Liabilities from ~~Contracts~~Equity and Derivatives and Hedging, which changes the accounting and earnings per share for certain instruments with ~~Customers (Topic 606).~~down round features. The ~~guidance requires an entity~~amendments in this ASU should be applied using a cumulative-effect adjustment as of the beginning of the fiscal year or retrospective adjustment to ~~recognize the amount of revenue to which it expects to be entitled~~each period presented and is effective for ~~the transfer of promised goods or services to customers. The FASB delayed the effective date to~~ annual ~~reporting~~ periods beginning after December 15, ~~2017, including~~2018, and interim ~~reporting~~ periods within ~~that reporting period. Earlier application~~those periods. We adopted this guidance effective July 1, 2019. The adoption of this guidance did not materially impact our financial statements and related disclosures.

		In February 2018, the Financial Accounting Standards Board (“FASB”) issued ASC Update No 2018-02 (Topic 220) Income Statement – Reporting Comprehensive Income: Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. This ASC update allows for a reclassification into retained earnings of the stranded tax effects in accumulated other comprehensive income (“AOCI”) resulting from the enactment of the Tax Cuts and Jobs Act (“TCJA”). The updated guidance is ~~permitted only as of~~effective for interim and annual ~~reporting~~ periods beginning after December 15, ~~2016, including interim reporting periods within that reporting period.~~ 2018. We adopted this guidance effective July 1, 2019. The adoption of this guidance did not materially impact our financial statements and related disclosures.

		In ~~addition, in March and April 2016,~~June 2018, the FASB issued ~~new~~ASU 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, to expand the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees and supersedes the guidance ~~intended~~in Subtopic 505-50, Equity - Equity-Based Payments to ~~improve~~Non-Employees. Under ASU 2018-07, equity-classified nonemployee share-based payment awards are measured at the ~~operability and understandability~~grant date fair value on the grant date The probability of ~~the implementation guidance on principal versus agent considerations. Both amendments permit the use of either a retrospective or cumulative effect transition method and are~~satisfying performance conditions must be considered for equity-classified nonemployee share-based payment awards with such conditions. ASU 2018-07 is effective for ~~fiscal years, and interim periods within those~~ fiscal years beginning after December 15, ~~2017,~~2018, with early ~~application~~adoption permitted. We adopted this guidance effective July 1, 2019. The adoption of this guidance did not materially impact our financial statements and related disclosures. In July 2018, the FASB issued ASU 2018-09 to provide clarification and correction of errors to the Codification. The amendments in this update cover multiple Accounting Standards Updates. Some topics in the update may require transition guidance with effective dates for annual periods beginning after December 15, 2018. We adopted this guidance effective July 1, 2019. The adoption of this guidance did not materially impact our financial statements and related disclosures.

F-10

			In August 2020, the FASB issued ASU 2020-06 to simplify the current guidance for convertible instruments and the derivatives scope exception for contracts in an entity’s own equity. Additionally, the amendments affect the diluted EPS calculation for instruments that may be settled in cash or shares and for convertible instruments. The update also provides for expanded disclosure requirements to increase transparency. For SEC filers, excluding smaller reporting companies, this update is effective for fiscal years beginning after December 15, 2021 including interim periods within those fiscal years. For all other entities, this Update is effective for fiscal years beginning after December 15, 2023, including interim periods therein. The Company ~~is assessing~~believes the adoption of this guidance will not materially impact our financial statements and related disclosures.

			The Company will continue to monitor these emerging issues to assess any potential future impact on its financial statements.

3.	Restatement of Prior Financial Information	Subsequent to Form 10K for the year ended June 30, 2019 filing, during the interim reviews and based on such reviews, the following determinations were made by the Company:

		Error in Accounting for Slotting and Set-up Fees

		During our review, we determined that the accounting treatment for the recognition of slotting fees and other fees paid or payable by the Company to certain strategic partners was incorrect. Specifically, it was determined that revenue relating to slotting fees, which were originally capitalized and amortized into expense over an 18-month period, should instead be treated as a reduction in revenue at the later of recognition of revenue for the transfer of the Nightfood product or when the Company pays or promised to pay the slotting fee. In addition, certain fees related to platforms to launch our products and advertising efforts should have been capitalized and recorded as an intangible asset. The Company previously recorded a portion of this fee as an intangible asset – placement fee and expensed the remaining amount as advertising expense in the Period Ended December 31, 2019.

		In accordance with the guidance provided by the SEC’s Staff Accounting Bulletin 99, Materiality (“SAB 99”) and Staff Accounting Bulletin 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements (“SAB 108”), the Company has determined that the impact of adjustments relating to the corrections of this ~~new standard on its~~accounting error are not material to previously issued annual audited and unaudited financial ~~statements~~statements. Accordingly, these changes are disclosed herein and ~~has not yet selected a transition method.~~will be disclosed prospectively.

	As of June 30, 2019 ^(A)
	Previously Reported			Adjustments		As Corrected
Consolidated Balance Sheet
Current assets	$	482,667		$	487,500	$	970,167
Current liabilities	$	2,955,272		$	223,333	$	3,178,605
Working capital (deficit)	$	(2,472,605	)	$	264,167	$	(2,208,438	)
Total assets	$	482,667		$	487,500	$	970,167
Total liabilities	$	2,955,272		$	223,333	$	3,178,605
Total stockholders' deficit	$	(2,472,605	)	$	264,167	$	(2,208,438	)

^(A)

The balance sheet impact of the errors was corrected in the quarter ended December 31, 2019.

	As of December 31, 2019
	Previously Reported			Adjustments			As Corrected
Consolidate Balance Sheet
Current assets	$	577,944		$	408,294		$	986,238
Current liabilities	$	4,514,446		$	249,007		$	4,763,453
Working capital (deficit)	$	(3,936,502	)	$	159,287		$	(3,777,215	)
Total assets	$	1,550,298		$	102,607		$	1,652,905
Total liabilities	$	4,514,446		$	249,007		$	4,763,453
Total stockholders’ deficit	$	(2,964,148	)	$	(146,400	)	$	(3,110,548	)

F-11

	For the Year Ended June 30, 2019 ^(A)
	Previously Reported			Adjustments			As Corrected
Consolidated Statements of Operations
Revenues	$	352,172		$	-		$	352,172
Operating expenses	$	2,263,722		$	(264,167	)	$	1,999,555
Loss from operations	$	(1,911,550	)	$	264,167		$	(1,647,383	)
Other income (expenses)	$	2,686,793		$	-		$	2,686,793
Net income (loss)	$	(4,598,343	)	$	264,167		$	(4,334,176	)
Basic & diluted EPS	$	(0.09	)	$	-		$	(0.09	)

^(A)

The income statement impact of the errors was corrected in the quarter ended September 30, 2019.

	For the Six Months Ended December 31, 2019
	Previously Reported			Adjustments			As Corrected
Consolidated Statements of Operations
Revenues	$	379,488		$	(271,706	)	$	107,782
Operating expenses	$	1,326,290		$	(125,306	)	$	1,200,984
Loss from operations	$	(946,802	)	$	(146,400	)	$	(1,093,202	)
Other income (expenses)	$	557,320		$	-		$	557,320
Net income (loss)	$	(1,504,122	)	$	(146,400	)	$	(1,650,522	)
Basic & diluted EPS	$	(0.02	)	$	-		$	(0.03	)

	For the Three Months Ended December 31, 2019
	Previously Reported			Adjustments			As Corrected
Consolidated Statements of Operations
Revenues	$	172,991		$	(111,706	)	$	61,285
Operating expenses	$	755,432		$	104,278		$	859,710
Loss from operations	$	(582,441	)	$	(215,984	)	$	(798,425	)
Other income (expenses)	$	338,517		$	-		$	338,517
Net income (loss)	$	(920,958	)	$	(215,984	)	$	(1,136,942	)
Basic & diluted EPS	$	(0.02	)	$	-		$	(0.02	)

Going Concern

●

The Company’s financial statements are prepared using generally accepted accounting principles, which contemplate the realization of assets and liquidation of liabilities in the normal course of business. Because the business is new and has limited operating history and relatively few sales, no certainty of continuation can be stated.

		●	The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. For the six months ended December 31, 2020, the Company had a net loss of $1,542,528, negative cash flow from operations of $617,879 and accumulated deficit of $19,173,651. Management is taking steps to raise additional funds to address its operating and financial cash requirements to continue operations in the next twelve months.

		●	The Company has limited available cash resources and we do not believe our cash on hand will be adequate to satisfy our ongoing working capital needs. The Company is continuing to raise capital through private placement of our common stock and through the use of convertible notes to finance the Company’s operations, of which it can give no assurance of success. However, the Company has a strong ongoing relationship with Eagle Equities and we expect to be able to continue to finance our operations as we have over the previous several quarters, although no assurance can be guaranteed. We believe that our current capitalization structure, combined with ongoing increases in revenues and hitting operational milestones, will enable us to successfully secure required financing to continue our growth. In the short term, the Company plans to continue to consider utilization of convertible notes as a financing vehicle, as it allows for today’s operating capital to be either repaid, or converted to equity at future valuations, as well as other financing strategies.

F-12


			Because the business is new and has limited operating history and sales, no certainty of continuation can be stated. Management has devoted a significant amount of time in the raising of capital from additional debt and equity financing. However, the Company’s ability to continue as a going concern is dependent upon raising additional funds through debt and equity financing and generating revenue. There are no assurances the Company will receive the necessary funding or generate revenue necessary to fund operations.

			Even if the Company is successful in raising additional funds, the Company cannot give any assurance that it will, in the future, be able to achieve a level of profitability from the sale of its products to sustain its operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for one year from the date the financial statements are issued. The accompanying financial statements do not include any adjustments to reflect the possible future effects on recoverability and reclassification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

			· The outbreak of the novel coronavirus (COVID-19), including the measures to reduce its spread, and the impact on the economy, cannot fully be understood and identified. Indications to date are that there are somewhat offsetting factors relating to the impact on our Company. Industry data shows that supermarket sales remain up, with more people spending more time at home. Anecdotally and statistically, snacking activity is also up while consumers are reporting a decrease in sleep quality and sleep satisfaction. Industry sales data also showed ice cream as one of the categories experiencing the largest increase with year over year growth averaging over 30% through a series of five one-week periods between March 15 and April 12, 2020 according to IRI data. The offsetting factors are the impact of the virus on the overall economy, and the impact that a down economic period can have on consumer behavior, including trial of new brands. Greater unemployment, recession, and other possible unforeseen factors are shown to have an impact. Research indicates that consumers are less likely to try new brands during economic recession and stress, returning to the legacy brands they’ve known for decades. With consumers generally making fewer shopping trips, while buying more on those occasions and reverting back to more familiar brands, certain brand-launch marketing tactics, such as in-store displays and in-store product sampling tables, are either impaired or impermissible. So, while overall night snacking demand is up, and consumer need/desire for better sleep is also stronger, driving consumer trial and adoption has been more difficult and expensive during these circumstances. From both public statements, and ongoing exploratory meetings between Nightfood Management and experts from certain global food and beverage conglomerates, it has been affirmed to Management that there is increased strategic interest in the nighttime nutrition space as a potential high-growth opportunity, partially due to recent declines in consumer sleep quality and increases in at-home nighttime snacking. We have experienced no major issues with supply chain or logistics. Order processing function has been normal to date, and our manufacturers have assured us that their operations are “business as usual” as of the time of this filing. It is possible that the fallout from the pandemic could make it more difficult in the future for the Company to access required growth capital, possibly rendering us unable to meet certain debts and expenses. More directly, COVID has impaired Nightfood’s ability to execute certain in-store and out-of-store marketing initiatives. For example, since the inception of COVID, the Company was unable to conduct in-store demonstrations and unable to participate in local pregnancy, baby expos, and health expos that were originally intended to be part of our marketing mix. Additionally, with more consumers shopping online, both for delivery or at-store pickup, the opportunity for shoppers to learn about new brands at-shelf has been somewhat diminished. Management is working to identify opportunities to build awareness and drive trial under these new circumstances. It is impossible to know what the future holds with regard to the virus, both for our company and in the broader sense. There are many uncertainties regarding the current coronavirus pandemic, and the Company is closely monitoring the impact of the pandemic on all aspects of its business, including how it will impact its customers, vendors, and business partners. It is difficult to know if the pandemic has materially impacted the results of operations, and we are unable to predict the impact that COVID-19 will have on our financial position and operating results due to numerous uncertainties. The Company expects to continue to assess the evolving impact of the COVID-19 pandemic and intends to make adjustments accordingly, if necessary.

~~F-7~~F-13

Accounts receivable

●

The Company’s accounts receivable arise primarily from the sale of the Company’s ~~snack products.~~ice cream. On a periodic basis, the Company evaluates each customer account and based on the days outstanding of the receivable, history of past write-offs, collections, and current credit conditions, writes off accounts it considers uncollectible. With most of our retail and distribution partners, invoices will typically be due in 30 ~~or 45~~ days. The Company does not accrue interest on past due accounts and the Company does not require collateral. Accounts become past due on an account-by-account basis. Determination that an account is uncollectible is made after all reasonable collection efforts have been exhausted. The Company has not provided any ~~sales~~accounts receivable allowances for December 31, ~~2017~~2020 and June 30, ~~2017,~~2020, respectively.

Inventories

●

Inventory consists of the following at December 31, ~~2017~~2020 and June 30, ~~2017,~~2020,

December 31,
2017 June 30,
2017
Finished Goods $ 10,115 $ 87,676
Packaging - 8,189
TOTAL $ 10,115 $ 95,865

	December 31, 2020		June 30, 2020
Finished goods – ice cream	$	132,855	$	195,817
Raw material – ingredients		23,019		26,309
Packaging		10,167		53,479
TOTAL	$	166,041	$	275,605

Inventories are stated at the lower of cost or ~~market.~~net realizable value. The Company periodically reviews the value of items in inventory and provides write-downs or write-offs of inventory based on its assessment of market conditions and the products relative shelf life. Write-downs and write-offs are charged to loss on inventory write down.

Other current assets

●

Other current assets consist of the following vendor deposits at December 31, ~~2017~~2020 and June 30, ~~2017,~~2020. The majority of this amount relates to deposits towards distribution and marketing partnerships.

December 31,
2017 June 30,
2017
Vendor deposits - Bars 52,416 -
Vendor deposits - Packaging 18,402 -
Vendor deposits - Other 4,150 3,491
TOTAL $ 74,968 $ 3,491

	December 31, 2020		June 30, 2020
Prepaid advertising costs	$	212,186	$	398,045
Vendor deposits – Other	$	40	$	40
TOTAL	$	212,226	$	398,085

Intangible Assets

Intangible assets consist of the following at December 31, 2020 and June 30, 2020. The amount of the intangible assets represents fees and expenses in connection with the development and launch of platforms used to track conversions, optimize ads, and scale online customer growth through a hybrid distribution model.

	December 31,		June 30,
	2020		2020
Intangible assets	$	-	$	1,000,000
Amortization of intangible assets		-		(500,000	)
Impairment of intangible assets		-		(500,000	)
TOTAL	$	-	$	-

During the quarter ending March 31, 2020, the Company determined it would be unable to generate sufficient traction from these digital assets. The Company made the decision to stop utilizing the assets.

F-14

7.8.

Other Current Liabilities

●

Other current liabilities consist of the following at December 31, ~~2017~~2020 and June 30, ~~2017,~~2020,

December 31,
2017 June 30,
2017
Accrued consulting fees – related party $ 192,000 $ 180,000
TOTAL 192,000 180,000

~~F-8~~

	December 31, 2020		June 30, 2020
Accrued consulting fees – related party	$	9,974	$	9,974
Accrued interest		248,492		192,625
Accrued slotting fees		56,923		-
TOTAL	$	315,389	$	202,599

8.9.

Notes Payable

●

Notes Payable consist of the following at December 31, ~~2017,~~2020,

On ~~February 8, 2017~~April 30, 2018, the Company ~~issued $32,500~~entered into a convertible promissory note and a security purchase agreement dated April 30, 2018, in ~~convertible notes to an investor group.~~the amount of $225,000. The lender was Eagle Equities, LLC. The notes have a maturity of ~~six (6) months~~April 30, 2019 and interest rate of 8% per annum and are convertible at a price of ~~80%~~60% of the ~~average~~lowest closing bid ~~prices~~price on the primary trading market on which the Company’s Common Stock is then listed for the ~~twenty (20)~~fifteen (15) trading days immediately prior to conversion. ~~The~~While this note is technically in default, our lender has agreed, in writing, to forbear any additional interest or penalties relating to this default providing the Company ~~also determined there was a beneficial conversion feature ( BCF ) as a result~~is in compliance with the remaining terms of the ~~intrinsic~~note. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value ~~between~~of the ~~effective exercise price~~$225,000 Notes was calculated using the Black-Scholes pricing model at $287,174, with the following assumptions: risk-free interest rate of 2.24%, expected life of 1 year, volatility of 202%, and expected dividend yield of zero. Because the ~~market price. The BCF is included in additional paid in capital.~~fair value of the note exceeded the net proceeds from the $225k Notes, a charge was recorded to “Financing cost” for the excess of the fair value of the note, for a net charge of $62,174. As of December 31, ~~2017, the BCF was $6,751.~~

~~As previously disclosed, this note was assigned to a third party that is not affiliate with Black Forest during fiscal year 2017. At such time, the maturity date of the note was extended to~~2020, and June 30, ~~2018. On August 10, 2017,~~2020, the ~~Company entered into a Forbearance Agreement with SkyBridge Ventures LLC, whereby the date of conversion eligibility for a $35,000 note held by SkyBridge~~debt discount was changed from August 8, 2017 to September 12, 2017. In addition, the note became convertible at a price of 50% of the lowest trading price of the Company’s Common Stock during the twenty (20) trading days immediately prior to conversion. During the quarter there were several conversions of this note into common stock ranging between $0.03 to $0.04 per share leaving a balance as of December 31, 2017 of $10,500.$0.

On ~~March~~November 16, ~~2017~~2018, the Company ~~issued $75,000~~entered into a convertible promissory note and a security purchase agreement dated November 16, 2018, in ~~convertible notes to an investor group.~~the amount of $130,000. The lender was Eagle Equities, LLC. The notes have a maturity of ~~one (1) year~~November 16, 2019 and interest rate of ~~12%~~8% per annum and are convertible at a price of ~~50%~~65% of the ~~average closing bid prices~~lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the ~~twenty (20)~~fifteen (15) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The ~~Company also determined there was a beneficial conversion feature ( BCF ) as a result~~convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the ~~intrinsic~~$130,000 Notes was calculated using the Black-Scholes pricing model at $131,898, with the following assumptions: risk-free interest rate of 2.71%, expected life of 1 year, volatility of 150%, and expected dividend yield of zero. Because the fair value ~~between~~of the ~~effective exercise price and~~note exceeded the ~~market price.~~net proceeds from the $130k Notes, a charge was recorded to “Financing cost” for the excess of the fair value of the note, for a net charge of $1,898.

~~On September 12, 2017 the Company~~This note has been successfully retired ~~this convertible promissory note dated March, 16, 2017,~~via conversion into shares during the six months ended December 31, 2019. The Company fair valued the notes as of conversion date and accounted for a gain on conversion of $25,398 included under line item “change in derivative liability” and also, reclassed the ~~original principal amount of $75,000.~~related $74,472 derivative liability balance into additional paid in capital.

On ~~March 20, 2017~~February 14, 2019, the Company ~~issued $80,000~~entered into a convertible promissory note and a security purchase agreement dated February 14, 2019, in ~~convertible notes to an investor group.~~the amount of $104,000. The lender was Eagle Equities, LLC. The notes have a maturity of ~~nine (9) months~~February 14, 2020 and interest rate of ~~12%~~8% per annum and are convertible at a price of ~~60%~~70% of the ~~average of the two~~ lowest ~~trade prices~~trading price on the primary trading market on which the Company’s Common Stock is then listed for the ~~twenty-five (25)~~fifteen (15) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash.

~~During the first quarter of Fiscal Year 2018, this~~ The convertible note ~~was sold to another party who increased the~~qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value ~~by $4,576 and extended the maturity to December 20, 2017. In addition, the discount was adjusted to 50%~~ of the ~~lowest trading price~~$104,000 Notes was calculated using the Black-Scholes pricing model at $90,567, with the following assumptions: risk-free interest rate of 2.53%, expected life of 1 year, volatility of 136%, and expected dividend yield of zero. Because the fair value of the ~~stock during~~note did not exceed the ~~previous 20 trading days. During~~net proceeds from the ~~quarter there were several conversions~~$104k Notes, no charge was recorded to “Financing cost” for the excess of ~~this note into common stock ranging between $0.03 to $0.06 per share leaving a balance as~~the fair value of the note. As of December 31, ~~2017~~2020, and June 30, 2020, the debt discount was $0 and $0, respectively. $50,000 of ~~$2,076.~~

the note has been successfully retired via conversion into shares during the year ended June 30, 2020 and $54,000 of the note has been successfully retired via conversion into shares during the six months ended December 31, 2020.The Company fair valued the notes as of conversion date and accounted for a loss on conversion of $36,242 included under line item “Loss on debt extinguishment upon note conversion, net”.

F-15

On ~~March 23, 2017~~April 29, 2019, the Company ~~issued $87,500~~entered into a convertible promissory note and a security purchase agreement dated April 29, 2019, in ~~convertible notes to an investor group.~~the amount of $208,000. The lender was Eagle Equities, LLC. The notes have a maturity of ~~six (6) months~~April 29, 2020 and interest rate of 8% per annum and are convertible at a price of ~~50%~~70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $208,000 Notes was calculated using the Black-Scholes pricing model at $170,098, with the following assumptions: risk-free interest rate of 2.42%, expected life of 1 year, volatility of 118%, and expected dividend yield of zero. Because the fair value of the note did not exceed the net proceeds from the $208k Notes, no charge was recorded to “Financing cost” for the excess of the fair value of the note. As of December 31, 2020, and June 30, 2020, the debt discount was $0 and $0, respectively. $208,000 of the note has been successfully retired via conversion into shares during the six months ended December 31, 2020. The Company fair valued the notes as of conversion date and accounted for a loss on conversion of $109,561 included under line item “Loss on debt extinguishment upon note conversion, net”.

On June 11, 2019, the Company entered into a convertible promissory note and a security purchase agreement dated June 11, 2019, in the amount of $300,000. The lender was Eagle Equities, LLC. The notes have a maturity of June 11, 2020 and interest rate of 8% per annum and are convertible at a price of 70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $300,000 Notes was calculated using the Black-Scholes pricing model at $240,217, with the following assumptions: risk-free interest rate of 2.05%, expected life of 1 year, volatility of 16%, and expected dividend yield of zero. Because the fair value of the note did not exceed the net proceeds from the $300k Notes, no charge was recorded to “Financing cost” for the excess of the fair value of the note. As of December 31, 2020 and June 30, 2020, the debt discount was $0 and $46,726, respectively. The Company fair valued the notes as of conversion date and accounted for a loss on conversion of $177,160 included under line item “Loss on debt extinguishment upon note conversion, net”. This note has been extinguished through the conversion into common shares as of December 31, 2020.

			On July 5, 2019, the Company entered into a convertible promissory note and a security purchase agreement dated July 5, 2019, in the amount of $300,000. The lender was Eagle Equities, LLC. The notes have a maturity of July 5, 2020 and interest rate of 8% per annum and are convertible at a price of 70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. While this note is technically in default, our lender has agreed, in writing, to forbear any additional interest or penalties relating to this default providing the Company is in compliance with the remaining terms of the note. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $300,000 Notes was calculated using the Black-Scholes pricing model at $239,759, with the following assumptions: risk-free interest rate of 1.98%, expected life of 1 year, volatility of 118%, and expected dividend yield of zero. Because the fair value of the note did not exceed the net proceeds from the $300k Notes, no charge was recorded to “Financing cost” for the excess of the fair value of the note. As of December 31, 2020 and June 30, 2020, the debt discount was $0 and $2,627, respectively.

			On August 8, 2019, the Company entered into a convertible promissory note and a security purchase agreement dated August 8, 2019, in the amount of $300,000. The lender was Eagle Equities, LLC. The notes have a maturity of August 8, 2020 and interest rate of 8% per annum and are convertible at a price of 70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. While this note is technically in default, our lender has agreed, in writing, to forbear any additional interest or penalties relating to this default providing the Company is in compliance with the remaining terms of the note. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $300,000 Notes was calculated using the Black-Scholes pricing model at $254,082, with the following assumptions: risk-free interest rate of 1.79%, expected life of 1 year, volatility of 113%, and expected dividend yield of zero. Because the fair value of the note did not exceed the net proceeds from the $300k Notes, no charge was recorded to “Financing cost” for the excess of the fair value of the note. As of December 31, 2020, and June 30, 2020 the debt discount was $0 and $26,452, respectively.

F-16

On August 29, 2019, the Company entered into a convertible promissory note and a security purchase agreement dated August 29, 2019, in the amount of $300,000. The lender was Eagle Equities, LLC. The notes have a maturity of August 29, 2020 and interest rate of 8% per annum and are convertible at a price of 70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. While this note is technically in default, our lender has agreed, in writing, to forbear any additional interest or penalties relating to this default providing the Company is in compliance with the remaining terms of the note. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $300,000 Notes was calculated using the Black-Scholes pricing model at $234,052, with the following assumptions: risk-free interest rate of 1.75%, expected life of 1 year, volatility of 113%, and expected dividend yield of zero. Because the fair value of the note did not exceed the net proceeds from the $300k Notes, no charge was recorded to “Financing cost” for the excess of the fair value of the note. As of December 31, 2020, and June 30, 2020 the debt discount was $0 and $37,833.

			On September 24, 2019, the Company entered into a convertible promissory note and a security purchase agreement dated September 24, 2019, in the amount of $150,000. The lender was Eagle Equities, LLC. The notes have a maturity of September 24, 2020 and interest rate of 8% per annum and are convertible at a price of 70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. While this note is technically in default, our lender has agreed, in writing, to forbear any additional interest or penalties relating to this default providing the Company is in compliance with the remaining terms of the note. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $150,000 Notes was calculated using the Black-Scholes pricing model at $118,009, with the following assumptions: risk-free interest rate of 1.78%, expected life of 1 year, volatility of 113%, and expected dividend yield of zero. Because the fair value of the note did not exceed the net proceeds from the $150k Notes, no charge was recorded to “Financing cost” for the excess of the fair value of the note. As of December 31, 2020 and June 30, 2020, the debt discount was $0 and $27,482.

			On November 7, 2019, the Company entered into a convertible promissory note and a security purchase agreement dated November 7, 2019, in the amount of $150,000. The lender was Eagle Equities, LLC. The notes have a maturity of November 7, 2020 and interest rate of 8% per annum and are convertible at a price of 70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. While this note is technically in default, our lender has agreed, in writing, to forbear any additional interest or penalties relating to this default providing the Company is in compliance with the remaining terms of the note. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $150,000 Notes was calculated using the Black-Scholes pricing model at $121,875, with the following assumptions: risk-free interest rate of 1.58%, expected life of 1 year, volatility of 122%, and expected dividend yield of zero. Because the fair value of the note did not exceed the net proceeds from the $150k Notes, no charge was recorded to “Financing cost” for the excess of the fair value of the note. As of December 31, 2020 and June 30, 2020, the debt discount was $0 and $43,074, respectively.

			On December 31, 2019, the Company entered into a convertible promissory note and a security purchase agreement dated December 31, 2019, in the amount of $150,000. The lender was Eagle Equities, LLC. The notes have a maturity of December 31, 2020 and interest rate of 8% per annum and are convertible at a price of 70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. While this note is technically in default, our lender has agreed, in writing, to forbear any additional interest or penalties relating to this default providing the Company is in compliance with the remaining terms of the note. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $150,000 Notes was calculated using the Black-Scholes pricing model at $189,172, with the following assumptions: risk-free interest rate of 1.59%, expected life of 1 year, volatility of 115%, and expected dividend yield of zero. Because the fair value of the note exceeded the net proceeds from the $150k Notes, $39,172 was recorded to “Financing cost” for the excess of the fair value of the note. As of December 31, 2020 and June 30, 2020, the debt discount was $0 and $75,205, respectively.

F-17

			On February 6, 2020, the Company entered into a convertible promissory note and a security purchase agreement dated February 6, 2020, in the amount of $200,000. The lender was Eagle Equities, LLC. The notes have a maturity of February 6, 2021 and interest rate of 8% per annum and are convertible at a price of 70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $200,000 Notes was calculated using the Black-Scholes pricing model at $156,061, with the following assumptions: risk-free interest rate of 1.51%, expected life of 1 year, volatility of 113%, and expected dividend yield of zero. As of December 31, 2020 and June 30, 2020, the debt discount was $15,392 and $94,064, respectively. On February 26, 2020, the Company entered into a convertible promissory note and a security purchase agreement dated February 26, 2020, in the amount of $187,000. The lender was Eagle Equities, LLC. The notes have a maturity of February 6, 2021 and interest rate of 8% per annum and are convertible at a price of 70% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the fifteen (15) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the $187,000 Notes was calculated using the Black-Scholes pricing model at $150,268, with the following assumptions: risk-free interest rate of 1.18%, expected life of 1 year, volatility of 118%, and expected dividend yield of zero. As of December 31, 2020 and June 30, 2020, the debt discount was $23,467 and $99,218, respectively.

			On April 30, 2020, the Company entered into a convertible promissory note and a security purchase agreement dated April 30, 2020, in the amount of $205,700. This note carried an Original Discount of 10% or $18,700 which was included in interest expense at the time of valuation. The lender was Eagle Equities, LLC. The notes have a maturity of April 30, 2021 and interest rate of 8% per annum and are convertible at a price of 78% of the lowest closing bid price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The ~~Company also determined there was a beneficial conversion feature ( BCF ) as a result~~convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the ~~intrinsic value between~~$205,700 Notes was calculated using the ~~effective exercise price~~Black-Scholes pricing model at $128,369, with the following assumptions: risk-free interest rate of 0.16%, expected life of 1 year, volatility of 106%, and ~~the market price. The BCF is included in additional paid in capital.~~expected dividend yield of zero. As of December 31, ~~2017, the BCF was $37,058.~~ ~~During the first quarter of Fiscal Year 2018 this note was sold to another party who increased the value by $7,500~~2020 and ~~extended the maturity to~~ June 30, ~~2018. The Company also determined there~~2020, the debt discount was ~~an additional beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price~~$42,555 and ~~the market price at the time of conversion of the sale of $95,000. The added BCF was included in additional paid in capital.~~ $106,916, respectively.

			On May 10, 2017 the Company issued $80,000 in convertible notes to an investor group. The notes have a maturity of nine (9) months and interest rate of 12% per annum and are convertible at a price of 60% of the average of the two lowest trade prices on the primary trading market on which the Company’s Common Stock is then listed for the twenty-five (25) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The Company also determined there was a beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price and the market price. The BCF is included in additional paid in capital. As of December 31, 2017, the BCF was $48,123.

F-18

During the second quarter of Fiscal Year 2018 this note was sold to another party who increased the value by $4,602.74 and extended the maturity to November 6, 2018. The conversion rate was reduced to 50%, look-back date changed from twenty-five days to Twenty and the interest rate was reduced to 8%. In addition the Company paid approximately $42,000 as consideration for this transfer.

On May 16, 2017 the Company issued $75,000 in convertible notes to an investor group. The notes have a maturity of one (1) year and interest rate of 12% per annum and are convertible at a price of 50% of the average closing bid prices on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The Company also determined there was a beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price and the market price. The BCF is included in additional paid in capital. As of December 31, 2017, the BCF was $45,560.

During the second quarter of Fiscal Year 2018 this note was sold to another party who increased the value by $4,216.44 and extended the maturity to November 6th, 2018. The conversion rate was reduced to 50%, look-back date changed from twenty-five days to Twenty and the interest rate was reduced to 8%. In addition the Company paid approximately $40,000 as consideration for this transfer.

On ~~July 31, 2017,~~June 23, 2020, the Company entered into a convertible promissory note and a security purchase agreement dated ~~July 31, 2017 and funded on August 1, 2017,~~June 23, 2020, in the amount of ~~$100,000.~~$205,700. This note carried an Original Discount of 10% or $18,700 which was included in interest expense at the time of valuation. The lender was Labrys Fund, LP. As part of this transaction, the Company issued Labrys a block of 400,650 “Commitment Shares”. These shares, although issued to Labrys, are to be returned to the Company should the Company pay off the note prior to the 6 month maturity date. In September of 2017, to facilitate the issuance of additional operating capital, the Company and Labrys agreed that Labrys shall be entitled to keep 100,000 of the 400,650 Commitment Shares in the event of a timely retirement of the debt.Eagle Equities, LLC. The notes have ana maturity of June 23, 2021 and interest rate of ~~12%~~8% per annum and are convertible at a price of ~~50%~~78% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The Company also determined there was a beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price and the market price at the time of conversion of $100,000. The BCF was included in additional paid in capital.

			On September 5, 2017 the Company entered into a convertible promissory note and a security purchase agreement dated September 5, 2017 and funded on September 12, 2017, in the amount of $75,000. The lender was JSJ Investments, Inc. The notes have a maturity of June 5, 2018 and interest rate of 12% per annum and are convertible at a price of 55% of the lowest tradingclosing bid price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The ~~Company also determined there was a beneficial conversion feature ( BCF ) as a result~~convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the ~~intrinsic value between~~$205,700 Notes was calculated using the ~~effective exercise price~~Black-Scholes pricing model at $132,236, with the following assumptions: risk-free interest rate of 0.18%, expected life of 1 year, volatility of 108%, and ~~the market price. The BCF is included in additional paid in capital.~~expected dividend yield of zero. As of December 31, ~~2017,~~2020 and June 30, 2020, the ~~BCF~~debt discount was ~~$42,857.~~$63,401 and $129,700, respectively.

			On ~~September 8, 2017,~~August 12, 2020, the Company entered into a convertible promissory note and a security purchase agreement dated ~~September 8, 2017 and funded on September~~August 12, ~~2017,~~2020, in the amount of ~~$222,750.~~$205,700. This note carried an Original Discount of 10% or $18,700 which was included in interest expense at the time of valuation. The lender was Eagle Equities, LLC. The notes have a maturity of ~~September 8, 2018~~August 12, 2021 and interest rate of 8% per annum and are convertible at a price of ~~50%~~78% of the lowest ~~trading~~closing bid price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The ~~Company also determined there was a beneficial conversion feature ( BCF ) as a result~~convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the ~~intrinsic value between~~$205,700 Notes was calculated using the ~~effective exercise price~~Black-Scholes pricing model at $126,029, with the following assumptions: risk-free interest rate of 0.13%, expected life of 1 year, volatility of 101%, and ~~the market price. The BCF is included in additional paid in capital.~~expected dividend yield of zero. As of December 31, ~~2017,~~2020, the ~~BCF~~debt discount was ~~$153,179.~~$77,690.

			On ~~September 21, 2017,~~October 13, 2020, the Company entered into a convertible promissory note and a security purchase agreement dated October 13, 2020, in the amount of ~~$66,500.~~$205,700. This note carried an Original Discount of 10% or $18,700 which was included in interest expense at the time of valuation. The lender was ~~Labrys Fund, LP.~~Eagle Equities, LLC. The notes have a maturity ~~date~~ of ~~March 21, 2018~~October 13, 2021 and an interest rate of ~~12%~~8% per annum and are convertible at a price of ~~50%~~78% of the lowest ~~trading~~closing bid price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The ~~Company also determined there was a beneficial conversion feature ( BCF ) as a result~~convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the ~~intrinsic value between~~$205,700 Notes was calculated using the ~~effective exercise price~~Black-Scholes pricing model at $126,471, with the following assumptions: risk-free interest rate of 0.13%, expected life of 1 year, volatility of 103.1%, and ~~the market price. The BCF is included in additional paid in capital.~~expected dividend yield of zero. As of December 31, ~~2017,~~2020, the ~~BCF~~debt discount was ~~$29,392.~~$99,097.

			On ~~October 18, 2017,~~December 21, 2020, the Company entered into a convertible promissory note and a security purchase agreement dated ~~October 18, 2017,~~December 21, 2020, in the amount of ~~$52,500.~~$205,700. This note carried an Original Discount of 10% or $18,700 which was included in interest expense at the time of valuation. The lender was Eagle Equities, LLC. The notes have a maturity of ~~October 18, 2018~~December 21, 2021 and interest rate of 8% per annum and are convertible at a price of ~~50%~~78% of the lowest ~~trading~~closing bid price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The ~~Company also determined there was a beneficial conversion feature ( BCF ) as a result~~convertible note qualifies for derivative accounting and bifurcation under ASC 815, “Derivatives and Hedging.” The fair value of the ~~intrinsic value between~~$205,700 Notes was calculated using the ~~effective exercise price~~Black-Scholes pricing model at $121,112, with the following assumptions: risk-free interest rate of 0.09%, expected life of 1 year, volatility of 93.97%, and ~~the market price. The BCF is included in additional paid in capital.~~expected dividend yield of zero. As of December 31, ~~2017, the BCF was $41,856.~~

			On November 3, 2017, the Company entered into a three-month consulting agreement with Regal Consulting for corporate communications services valued at $20,000 monthly. Regal will be compensated $10,000 in cash monthly for services provided. In addition, the Company has issued Regal a six month note for $30,000, which the Company may prepay at any time. Should the note not be repaid after 180 days, Regal shall have the option to convert2020, the debt ~~to equity at a~~ discount ~~to the then market price.~~ The convertible promissory note a security purchase agreement in the amount of $30,000. The notes have a maturity date of May 3, 2018 and an interest rate of 10% per annum and are convertible at a price of 65% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the ten (10) trading days immediately prior to conversion or $0.11 whichever is lower. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The Company also determined there was a beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price and the market price. The BCF is included in additional paid in capital. As of December 31, 2017, the BCF was $20,333. $117,794.

F-19

			On November 6th, 2017, the Company entered into a convertible promissory note and a security purchase agreement dated November 6, 2017, in the amount of $48,647. The lender was Eagle Equities, LLC. The notes have a maturity of November 6, 2018 and interest rate of 8% per annum and are convertible at a price of 50% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The Company also determined there was a beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price and the market price. The BCF is included in additional paid in capital. As of December 31, 2017, the BCF was $41,317.

			On November 6th, 2017, the Company entered into a convertible promissory note and a security purchase agreement dated November 6, 2017, in the amount of $45,551. The lender was Eagle Equities, LLC. The notes have a maturity of November 6, 2018 and interest rate of 8% per annum and are convertible at a price of 50% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The Company also determined there was a beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price and the market price. The BCF is included in additional paid in capital. As of December 31, 2017, the BCF was $38,687.

			On November 7, 2017 the Company entered into a convertible promissory note and a security purchase agreement (SPA) dated November 7, 2017. The SPA was for a total of $315,000, consisting of four tranches of funding, each equal to $78,750. The parties closed on the first tranche. There can be no assurance that the Company will receive any further tranches. On November 7, 2017, the Company entered into a convertible promissory note a security purchase agreement dated November 7, 2017, in the amount of $78,750. The lender was Adar Bay, LLC. The notes have a maturity of November 7, 2018 and interest rate of 8% per annum and are convertible at a price of 50% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The Company also determined there was a beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price and the market price. The BCF is included in additional paid in capital. As of December 31, 2017, the BCF was $65,548.

			On November 15, 2017 the Company entered into a convertible promissory note and a security purchase agreement (SPA) dated November 15, 2017. The SPA was for a total of $150,000, consisting of two tranches of funding, each equal to $75,000. The parties closed on the first tranche. There can be no assurance that the Company will receive any further tranches. On November 15, 2017, the Company entered into a convertible promissory note a security purchase agreement dated November 15, 2017, in the amount of $75,000. The lender was Eagle Equities, LLC. The notes have a maturity of November 15, 2018 and interest rate of 8% per annum and are convertible at a price of 50% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the twenty (20) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The Company also determined there was a beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price and the market price. The BCF is included in additional paid in capital. As of December 31, 2017, the BCF was $67,284.

			On December 6, 2017, the Company entered into a convertible promissory note and a security purchase agreement in the amount of $56,000. The lender was Labrys Fund, LP. The notes have a maturity date of June 6, 2018 and an interest rate of 12% per annum and are convertible at a price of 50% of the lowest trading price on the primary trading market on which the Company’s Common Stock is then listed for the twenty-five (25) trading days immediately prior to conversion. The note may be prepaid, but carries a penalty in association with the remittance amount, as there is an accretion component to satisfy the note with cash. The Company also determined there was a beneficial conversion feature ( BCF ) as a result of the intrinsic value between the effective exercise price and the market price. The BCF is included in additional paid in capital. As of December 31, 2017, the BCF was $48,308.

~~Below is a reconciliation of the convertible notes payable as presented on the Company’s balance sheet as of December 31, 2017:~~

Convertible notes payable issued as of June 30, 2017 $ 430,000
Convertible notes payable issued as of December 31, 2017 $ 884,093
Unamortized amortization of debt and beneficial conversion feature (703,101 )
Notes paid (75,000 )
Notes converted into shares of common stock (117,000 )
Balance at December 31, 2017 $ 418,992

Below is a reconciliation of the convertible notes payable as presented on the Company’s balance sheet as of December 31, 2020:

	Principal ($)			Debt Discount ($)			Net Value ($)
Balance at June 30, 2019		1,748,000			(630,259	)		1,117,741
Convertible notes payable issued during fiscal year ended June 30, 2020		2,148,400			-			2,148,400
Notes converted into shares of common stock		(961,000	)		-			(961,000	)
Debt discount associated with new convertible notes		-			(1,684,711	)		(1,684,711	)
Amortization of debt discount		-			1,709,759			1,709,759
Balance at June 30, 2020		2,935,400			(605,211	)		2,330,189
Convertible notes payable issued during six months ended December 31, 2020		617,100			-			617,100
Notes converted into shares of common stock		(562,000	)		-			(562,000	)
Debt discount associated with new convertible notes		-			(373,612	)		(373,612	)
Amortization of debt discount		-			576,787			576,787
True-up adjustment in debt discount and derivative liability		-			(37,360	)		(37,360	)
Balance at September 30, 2020		2,990,500			(439,396	)		2,551,104

Amortization expense for the six months ended December 31, 2020 and 2019, totaled $576,787 and $831,436, respectively and Amortization expense for the three months ended December 31, 2020 and 2019, totaled $254,048 and $449,169 respectively.

As of December 31, 2020 and June 30, 2020, the unamortized portion of debt discount was $439,396 and $605,211, respectively.

Interest expense for the six months ended December 31, 2020 and 2019, totaled $195,530 and $42,336, respectively and interest expense for the three months ended December 31, 2020 and 2019, totaled $111,575 and $15,738, respectively.

As of December 31, 2020 and June 30, 2020, the accrued interest related to convertible notes was $247,942 and $192,625, respectively.

9.10.

Derivative Liability

Due to the variable conversion price associated with some of these convertible promissory notes disclosed in Note 8 above, the Company has determined that the conversion feature is considered a derivative liability for instruments which are convertible and have not yet been settled. The accounting treatment of derivative financial instruments requires that the Company record the fair value of the derivatives on the date they are deemed to be derivative liabilities.

During the ~~year~~six month period ended ~~June 30, 2017,~~December 31, 2020, the Company recorded a ~~loss~~change in fair value of derivative ~~$44,022.~~$264,818. The Company will measure the fair value of each derivative instrument in future reporting periods and record ~~a gain or loss~~the change based on the change in fair value.

During the six month period ended December 31, 2017, the Company recorded a loss in fair value of derivative $1,016,453. The Company will measure the fair value of each derivative instrument in future reporting periods and record a gain or loss based on the change in fair value.


~~10.~~	~~Short and long term Borrowings~~	●	~~On November 24, 2010,~~Below is a reconciliation of the ~~Company entered into a Small Business Working Capital Loan with a well-established Bank. The loan is personally guaranteed by~~derivative liability as presented on the Company’s ~~Chief Executive Officer, which is further guaranteed for 90% by the United States Small Business Administration (SBA).~~

			~~The term~~balance sheet as of the loan is seven years until full amortization and carried an 8.25% interest rate, through the Third Quarter of our 2017 fiscal year. Monthly principal payments are required during this 84 month period.December 31, 2020:

December 31,
2017 June 30,
2017
Bank loan $ 2,000 $ 3,096
Total borrowings 2,000 3,096
Less: current portion (2,000 ) (3,096 )
Long term debt $ - $ -

Derivative liability as of June 30, 2019	$	1,306,748
Initial derivative liability accounted for convertible notes payable issued during the period ended June 30, 2019		1,723,883
Change in derivative liability during the period		(858,774	)
Reclassify derivative liability associated with Notes converted into loss on debt conversion account		(581,219	)
Derivative liability as of June 30, 2020	$	1,590,638
Initial derivative liability accounted for convertible notes payable issued during the period ended December 31, 2020		373,612
True-up adjustment in debt discount and derivative liability		37,360
Change in derivative liability during the period		(264,818	)
Reclassify derivative liability associated with Notes converted into loss on debt conversion account		(320,746	)
Balance at December 31, 2020	$	1,416,045

Change in derivative liability for the six months ended December 31, 2020 and 2019, totaled $264,818 and $355,625, respectively and change in derivative liability for the three months ended December 31, 2020 and 2019, totaled $57,294 and $165,563, respectively.

As of December 31, 2020 and June 30, 2020, the derivative liability related to convertible notes was $ 1,416,045 and $1,590,638, respectively.

F-20

11.

Line of Credit

On March 19, 2020, the Company secured a $200,000 line of credit with Celtic Bank Corporation. This LOC has a “Flex Credit” component of calculating interest, which means the interest rate on any draws taken against the LOC is set at the time of said draw. As of the date of this filing, the Company has made one draw against the credit line for a gross amount of $5,000 (including proceeds and draw fees). As of December 31, 2020, nine payments had been made against this draw of approximately $368 each. Such payments will continue to be automatically deducted from the corporate checking account until the draw and all fees have been paid in full. The Company may or may not choose to use this line of credit for additional financing needs.

	Dec. 30, 2020		June 30, 2020
Line of Credit	$	1,692	$	3,897
Total borrowings		1,692		3,897
Less: current portion		1,692		3,897
Long term debt	$	-	$	-

Interest expense for the six months ended December 31, 2020 and 2019, totaled $675 and $0, respectively and interest expense for the three months ended December 31, ~~2017~~2020 and ~~2016,~~2019, totaled $0$338 and ~~$338,~~$0, respectively.

~~11.~~12.

Capital Stock Activity

●

The Company ~~has 35,368,758~~had 68,886,863 and ~~29,724,432~~61,796,680 shares of its $0.001 par value common stock issued and outstanding as of December 31, ~~2017~~2020 and June 30, ~~2017~~2020 respectively.

●

During the six months ended December 31, ~~2017~~2020 the Company issued ~~1,801,150 shares of common stock for services valued at $260,156, issued 264,085 shares of common stock for cash proceeds of $30,000, issued 3,527,543~~5,857,199 shares in regards to debt being converted into stock valued at ~~$117,000~~$562,000, and issued ~~51,548~~649,070 shares of common stock valued at ~~$3,988~~$61,486 as part of a loan agreement and payment of interest as part of the debt conversion. Also during these six months the Company issued 583,914 shares for services valued at $88,673. Further during these six months the Company accounted in additional paid in capital the warrants issued for services valued at $65,711 and loss on fair value of shares upon conversion amounting to $359,467.

During the six months ended December 31, 2019 the Company issued 207,762 shares of common stock for services valued at $70,897, issued 2,909,844 shares in regards to debt being converted into stock valued at $557,000, and issued 217,631 shares of common stock valued at $42,336 as part of a loan agreement and payment of interest as part of the debt conversion. Further during these six months the Company accounted in derivative liability reclassed upon debt conversion amounting to $342,344.

~~12.~~13.	~~Advances by Affiliates~~Warrants	●	~~On August 24, 2017,~~The following is a ~~shareholder loaned~~summary of the ~~company $10,000. As~~Company’s outstanding common stock purchase warrants. Of the 500,000 warrants shown below at an exercise price of $.15, these warrants were issued as compensation for ~~making this loan, the shareholder received 10,000 shares of Company common stock, and is entitled to $2,000 interest. This advance was secured by~~ a ~~promissory note from the company to the shareholder whereby the company has until February~~four-year advisory agreement. 150,000 warrants vested on July 24, 2018, another 150,000 on July 24, 2019, another 150,000 vested on July 24, 2020, and the remaining 50,000 will vest on July 24, 2021, should advisor complete the term of his engagement. These warrants were all accounted for in Fiscal 2020.

			During the six months ended December 31, 2020 the Company entered into a warrant agreement with one of the Company’s vendors issuing 500,000 warrants at a strike price of $0.50 having a term of five years. The Company valued these warrants using the Black Scholes model utilizing a 107.93% volatility and a risk-free rate of 0.29%

			The aggregate intrinsic value of the warrants as of December 31, 2020 is $-0-.

		Outstanding at						Outstanding
Exercise Price		June 30, 2020		Issued / (Exercised) in 2020		Expired		December 31 2020
$	0.15		500,000		-		-		500,000
$	0.20		105,000		-		-		105,000
$	0.30		100,000		-		-		100,000
$	0.40		150,000		-		-		150,000
$	0.50		-		500,000		-		500,000
$	0.75		300,000		-		-		300,000
			1,155,000		500,000		-		1,655,000

F-21

14.	Fair Value of Financial Instruments	Cash and Equivalents, Receivables, Other Current Assets, Short-Term Debt, Accounts Payable, Accrued and Other Current Liabilities.

		The carrying amounts of these items approximated fair value.

		Fair value is defined as the price that would be received to ~~repay~~sell an asset or paid to transfer a liability in an orderly transaction between market participants at the ~~principal~~measurement date. To increase the comparability of fair value measures, Financial Accounting Standards Board (“FASB”) ASC Topic 820-10-35 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and ~~interest.~~the lowest priority to unobservable inputs (level 3 measurements).

		Level 1—Valuations based on quoted prices for identical assets and liabilities in active markets.

		Level 2—Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

		Level 3—Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment.

		The application of the three levels of the fair value hierarchy under Topic 820-10-35 to our assets and liabilities are described below:

	December 31, 2020 Fair Value Measurements
	Level 1		Level 2		Level 3		Total Fair Value
Assets
Other assets	$	-	$	-	$	-	$	-
Total	$	-	$	-	$	-	$	-
Liabilities
Derivative Liabilities	$		$	-	$	1,416,045	$	1,416,045
Total	$		$	-	$	1,416,045	$	1,416,045

F-22

	June 30, 2020 Fair Value Measurements
	Level 1		Level 2		Level 3		Total Fair Value
Assets
Other assets	$	-	$	-	$	-	$	-
Total	$	-	$	-	$	-	$	-
Liabilities
Derivative Liabilities	$		$	-	$	1,590,638	$	1,590,638
Total	$		$	-	$	1,590,638	$	1,590,638

Management considers all of its derivative liabilities to be Level 3 liabilities. At December 31, 2020 and June 30, 2020, respectively the Company had outstanding derivative liabilities, including those from related parties of $1,416,045 and $1,590,638, respectively.

15.

Commitments and Contingencies:

The Company has entered into certain consulting agreements which carry commitments to pay advisors and consultants should certain events occur. An agreement is in place with one Company Advisor that calls for total compensation over the four year Advisor Agreement of 500,000 warrants with an exercise price of $.15 of which 450,000 have vested, should the advisor complete the entire term of the engagement, the remaining 50,000 warrants would vest on July 24, 2021. These warrants were all accounted for in Fiscal 2020.

Additional Consulting agreements call for certain Consultants to receive cash and stock bonuses for directly assisting the Company in hitting certain operational milestones, such as national television publicity, achieving revenues of $500,000 monthly, $1,000,000 monthly, and $3,000,000 quarterly. As of December 31, 2020, those conditions were not met and therefore nothing was accrued related to this arrangement.

CEO Sean Folkson has a twelve-month consulting agreement which went into effect on February 4, 2021, which will reward him with bonuses earned of 1,000,000 warrants at a strike price of $.50 when the Company records its first quarter with revenues over $1,000,000, an additional 3,000,000 warrants with a $.50 strike price when the Company records its first quarter with revenues over $3,000,000, and an additional 3,000,000 warrants with a $1 strike price when the Company records its first quarter with revenues over $5,000,000. Folkson will also be awarded warrants with a strike price of $.50 should the Company exceed $500,000 in non-traditional retail channel revenue during the Term of the Agreement, and should the company enter into a product development or distribution partnership with a multi-national food & beverage conglomerate during his Agreement. As of December 31, 2020, those conditions were not met and therefore nothing was accrued related to this arrangement.

16.

Related Party Transactions

●

During the third quarter of Fiscal Year 2015, Mr. Folkson began accruing a consulting fee of $6,000 per month which the aggregate of ~~$6,000~~$18,000 is reflected in professional fees for the ~~three~~six month period ended December 31, ~~2017~~2020 and reflected in the accrued expenses – related party with a balance of ~~$192,000~~$9,974 and ~~$180,000~~$9,974 at December 31, ~~2017~~2020 and June 30, ~~2017,~~2020, respectively.

On December 8, 2017, Mr. Folkson ~~acquired~~purchased Warrants, at a cost of $.15 per Warrant, to acquire up to 80,000 additional shares of NGTF stock at a strike price of $.20, and with a term of three (3) years from the date of ~~this~~said agreement. ~~Mr. Folkson acquired these Warrants at a cost of $.15 per warrant, which will result~~This purchase resulted in a reduction in the accrued consulting fees due him by $12,000. ~~In addition, during~~During the second quarter 2019 Mr. Folkson purchased 400,000 shares of stock at a strike price of $0.30 per share, valued at $120,000 which was charged to his accrual. During the six months ended December 31, ~~2017,~~2020, Folkson had been paid ~~$12,000~~$36,000 against his total accrued balance to ~~date.~~date and reflected in the accrued expenses – related party with a balance of $9,974 and $9,974 at December 31, 2020 and June 30, 2020, respectively.

~~13.~~	~~Subsequent Events~~	●	On January 31, the Registrant received proceeds of $200,000 in conjunction with a promissory note from, and a Securities Purchase Agreement with, Eagle Equities entered into on September 8, 2017. The note has a maturity date of September 8, 2018, a face value of $210,000 and carries an 8% interest rate. Should the Note not be paid in full prior to maturity, any remaining balance would be convertible into the Registrant’s common stock at a discount to market. The foregoing is only a summary of the terms of the note which is included as an exhibit to this report. ~~The proceeds will be used to fund production of NightFood inventory, development of the Half-Baked line of snacks, and ongoing NGTF operating expenses.~~

		●	On January, 19, 2018, the Registrant donated product valued at approximately $24,000, to Rock and Wrap It Up!, a non-profit organization formed in 1990, dedicated to addressing the issues of hunger and poverty in America. The donated product was distributed to over one dozen local shelters and community centers to help them feed the hungry. The Registrant has committed to making further donations to this charitable organization which will allow them to facilitate monthly “NightFood Nights” as part of their providing regular meals to homeless persons. Management believes that the goodwill generated by donations such as this one of short-dated inventory to Rock and Wrap It Up! will prove beneficial to our business and our shareholders.

		●	On January 25, 2018, the Company successfully filed its application with the United States Patent and Trademark Office for the U.S. Trademark “Half-Baked” for the line of snacks currently under development by NGTF subsidiary, MJ Munchies, Inc.

		●	On January 30, 2018, the Company entered into a product development agreement with Abunda Foods, whereby Abunda will drive the development of new Half-Baked snack products intended to be marketed online and in dispensaries throughout the country. Abunda is controlled by NGTF shareholder Peter Leighton. Abunda, and Leighton, have a long history of success in consumer snack product development, having successfully done product development work for clients such as Tiger’s Milk, Cascadian Farm, and National Beverage Corp.

●

~~On February 3, 2018,~~

In addition, the ~~Registrant entered into~~Company made bonuses available to Folkson upon the Company hitting certain revenue milestones of $1,000,000 in a ~~six month Consulting Agreement~~quarter, $3,000,000 in a quarter, and $5,000,000 in a quarter. Achieving those milestones would earn Folkson warrants with ~~Regal Consulting for corporate communications services. The Registrant had entered~~ a ~~three month agreement with Regal on November 3, 2017 for similar services,~~$.50 and ~~has chosen~~$1 strike price which would need to ~~extend~~be exercised within 90 days of the ~~engagement with Regal~~respective quarterly or annual filing. As of December 31, 2020, those conditions were not met and therefore nothing was accrued related to ~~continue to raise investor awareness for NGTF. Compensation to Regal includes $10,000 per month in cash, and a $200,000 six-month convertible promissory note.~~this arrangement

17.
	Subsequent Events	●	On February ~~2, 2018,~~22, 2021 the Company entered into ana convertible promissory note and security purchase agreement ~~for services with internet marketing expert Gregory Getner~~dated and funded February 22, 2021, in the amount of $205,700. The ~~Getner Group,~~lender was Eagle Equities, LLC. The agreement called for compensation over the first three months of $22,400 in cash, and 40,000 shares of common stock. Getner can earn additional equity bonuses over the remainder of the twelve month agreement by reaching certain sales metrics on the NightFood.com website.

		●	OnBetween the dates of January ~~10, 2018,~~1, 2021 and February 22, 2021, noteholder Eagle Equities converted a total of $338,147 of principal and interest from outstanding notes to Company stock. The average conversion price in these transactions was $.062. 5,462,951 shares were issued to the ~~Registrant entered into “Lock Up” Agreements with its two largest shareholders. Sean Folkson, owner~~noteholder in these transactions which reduced the principal amount of ~~16,433,568 shares, and Peter Leighton, owner of 4,000,000 shares, have both agreed to not transfer, sell, or otherwise dispose of any shares of their NGTF stock during the next twelve months.~~convertible debt balance by $300,000. ~~As part~~
		●	During January of ~~this agreement, Leighton received warrants~~2021, the Company issued 205,000 shares to acquire 100,000 shares of NGTF common stock at an exercise price of $.30 per share. Folkson received warrants to acquire 400,000 shares of NGTF common stock at an exercise price of $.30 per share. All warrants carry a similar twelve month term and a cashless provision, and will expire if not exercised within the twelve month term. vendors in exchange for services.

		●	~~On February 1, 2018,~~In January of 2021, the Company ~~made~~issued a ~~payment~~total of ~~$12,000~~760,000 Warrants. 360,000 warrants with a strike price of $.01 were issued to ~~fully retire~~ a ~~$10,000 promissory note held by shareholder Richard Faraci since August~~3^rd Party licensed and registered Investment Banker who is working with Management to help with restructuring of ~~2017.~~

		●	Oncap table and balance sheet, and sourcing non-debt capital. 400,000 warrants with a strike price of $.30 were issued to Mr. Sean Folkson, Nightfood CEO, in conjunction with Folkson’s agreement to lock-up 100% of his shares in the Company through February 14, 2018, the Registrant formally terminated an Agreement dated November 26, 2016 by and among the Registrant, Hook Group, LLC (“Hook”) and Suffield Foods. LLC (“Suffield”). The Agreement was previously filed as exhibit 99.1 to the Registrant’s Current Report on Form 8-K filed December 6, 2016. 4, 2022.

F-23

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

FORWARD LOOKING STATEMENT INFORMATION

Certain statements made in this Quarterly Report on Form 10-Q involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. You can identify these statements by the fact that they do not relate strictly to historical or current facts, and use words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “may,” “should,” “plan,” “project,” “will” and other words of similar meaning. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. Our plans and objectives are based, in part, on assumptions involving judgments with respect to, among other things, future economic, competitive and market conditions, technological developments related to business support services and outsourced business processes, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control.

Although we believe that our assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the forward-looking statements included in this Quarterly Report on Form 10-Q will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein particularly in view of the current state of our operations, the inclusion of such information should not be regarded as a statement by us or any other person that our objectives and plans will be achieved. Factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, the factors set forth under the headings “Business” and “Risk Factors” within our Annual Report on Form 10-K for the fiscal year ended June 30, ~~2017,~~2020, as well as the other information set forth herein.

OVERVIEW

~~NightFood~~Nightfood Holdings runs two distinct operating companies, each serving a different market segment with different products.

~~MJ Munchies,~~Nightfood, Inc. is a Nevada corporation formed in January of 2018 to exploit legally compliant opportunities in the CBD and marijuana edibles and related spaces. The Company intends to market some of these new products under the brand name “Half-Baked”. As this subsidiary was created subsequent to the end of the current reporting period, which concluded on December 31, 2017, its operations have no impact on the financial statements contained herein.

Since inception, MJ Munchies has applied for U.S. Trademark protection for its brand of Half-Baked snacks, currently under development. In addition, the Company has entered into a product development agreement with Abunda Foods, controlled by NGTF shareholder Peter Leighton, whereby Abunda will drive the development of new Half-Baked snack products intended to be marketed online and in dispensaries throughout the country. Abunda, and Leighton, have a long history of success in consumer snack product development, having successfully done product development work for clients such as Tiger’s Milk, Cascadian Farm, and National Beverage Corp.

~~NightFood, Inc. is a~~better-for-you snack company focused on manufacturing and distributing snacks with sleep-friendly formulations and ingredients. The national roll-out of Nightfood ice cream, the first Nightfood product with significant mainstream retail distribution, began in 2019. The Company has since secured distribution in multiple regional supermarket chains, and divisions of ~~nutritional/snack foods~~national supermarket chains, including divisions of Kroger (Harris Teeter), and divisions of Albertsons (Jewel-Osco, Shaw’s and Star Market). As of the time of this filing, Management has received confirmation from all our major supermarket chains that ~~are appropriate~~the brand has been renewed for ~~evening snacking. NightFood’s first product is~~2021. Certain chains may do periodic category reviews mid-year, but Management believes that our current sales velocity combined with marketing efforts to grow the ~~NightFood nutrition bar, currently available~~brand will allow us to retain our shelf space in ~~two flavors (Cookies n’ Dreams,~~these chains so that we may continue to grow our consumer base and ~~Midnight Chocolate Crunch).~~our revenues.

Nightfood ice cream won the 2019 Product of the Year award in the ice cream category in a Kantar survey of over 40,000 consumers. The brand also won Best New Ice Cream at the 2019 World Dairy Innovation Awards. In early 2019, the Company proactively secured trademark protection for the Nightfood brand in several strategic international markets.

Management believes consumer demand exists for better nighttime snacking options, and that a new consumer category consisting of nighttime specific snacks will emerge in the coming years. This belief is supported by research from major consumer goods research firms such as IRI Worldwide, and Mintel, who identified nighttime specific foods and beverages as one of the “most compelling and category changing trends” for 2017 and beyond. In recent years, CEO’s and other executives from major consumer goods conglomerates such as Nestle, PepsiCo, Mondelez, and Kellogg’s have commented on consumer nighttime snack habits and the opportunity that exists in solving this problem for the marketplace.

~~It is estimated that over $50B is spent annually~~In addition to those high-profile public statements, significant strategic interest in the ~~United States on snacks~~nighttime and sleep-friendly nutrition space has been directly affirmed to Management in recent exploratory discussions and negotiations initiated by a certain global food and beverage conglomerate which remain ongoing as of the time of this filing. Management anticipates that ~~are consumed between dinner~~the multi-national food and ~~bed.~~ beverage companies will necessarily be drawn to the category Nightfood is pioneering because of these facts:

	●	Over 80% of American adults snack regularly after dinner

	●	Over 40% of all snacking occurs between dinner and bed

	●	Every week in the United States, hundreds of millions of nighttime snacks are consumed, resulting in over $1 Billion dollars in consumer spend

	●	More than half of consumers seek out snacks with functional benefits beyond hunger satisfaction and taste

	●	80% of consumers worldwide report wanting to improve their sleep quality

●

The most popular nighttime snack choices in the United States are cookies, chips, candy, and ice cream. These are all understood to be both unhealthy and generally disruptive to sleep quality.

Growth within the category that Nightfood is creating can bring competitive risk, but also the opportunity that comes with being the pioneer of a growing market segment and the strategic value that the Nightfood brand could deliver to a global partner with significant resources.

Company ~~management~~Management believes that a ~~significant~~meaningful percentage of ~~that~~this $50 billion in consumer spend will move from conventional snacks over to nighttime specific, sleep-friendly snacks in coming years.

~~A NightFood~~2

The Nightfood Scientific Advisory Board ~~was recently established.~~is made up of leading sleep and nutrition experts, who help Nightfood deliver on its brand promise. The first member of this advisory board iswas Dr. Michael Grandner, Director of the Sleep and Health Research Program at the University of Arizona. Dr. Grandner has been conducting research on the link between nutrition and sleep for over ten years, and he believes improved nighttime nutritional choices can improve sleep, resulting in many short and long-term health benefits.

~~NightFood has recently reported significant growth in direct-to-consumer sales through~~ In March of 2018, the ~~NightFood.com website and Amazon.~~

~~DEVELOPMENT PLANS~~

Company added Dr. Michael Breus to their Scientific Advisory Board. Breus, known to millions as The ~~NightFood brand continues to focus on online revenue growth at this time. NightFood intends to launch gluten-free versions of NightFood nutrition bars during 2018. It~~Sleep Doctor™, is ~~also expected that additional flavors will be launched in a similar timeframe. Towards the end of calendar 2018, with new flavors available, and what is expected~~believed to be ~~a healthy revenue base,~~ the ~~Company intends to begin revisiting a retail rollout for NightFood bars.~~

~~The Company is also working towards the launch of NightFood ice cream~~Nation’s most prominent authority on sleep. He regularly appears in the ~~latter half~~national media to educate and inform consumers so they can sleep better and lead happier, healthier, more productive lives. In July, 2018, we added Lauren Broch, Ph.D, M.S. Dr. Broch is a sleep therapist and former Director of ~~2018. A major regional ice cream distributor is prepared~~Education & Training at the Sleep-Wake Disorders Center at Weill Cornell Medical College. Dr. Broch also has a master’s degree in human nutrition. This unique combination allowed her to ~~bring the NightFood ice cream line to market, provided the product meets certain taste and nutritional standards, which we’re confident it will.~~

~~NightFood also intends to add one to two new members to its Scientific Advisory Board~~play an important role in the ~~coming months~~development of Nightfood ice cream. These experts work with Company management to ~~help~~ ensure ~~NightFood~~Nightfood products ~~are able to~~ deliver on their nighttime-appropriate, and sleep-friendly promises.

In February 2020, Nightfood was named the Official Ice Cream of the American Pregnancy Association. Compared to regular ice cream, Nightfood is higher in calcium, magnesium, zinc, protein and fiber, and contains less sugar, fewer calories, and is lower glycemic. Ease of digestion and the impact of nighttime heartburn were also considerations that went in to Nightfood’s formulations. Management believes the designation and recommendation from the American Pregnancy Association could expose the brand ~~promise,~~to a large base of new consumers and ~~establish additional credibility with consumers,~~drive a volume of new demand that will support an effective national roll-out of the ~~media, and retail buyers.~~ice cream line.

MJ Munchies, ~~continues~~Inc. is a Nevada corporation formed in January of 2018 to ~~advance~~exploit legally compliant opportunities in the ~~Half-Baked snack line through product R&D~~CBD and marijuana edibles and related spaces. To date, this subsidiary and its ~~various industry relationships. Developments are occurring rapidly, as~~operations have had a nominal impact on the ~~Company recently announced it had completed~~financial statements contained herein.

Since inception, MJ Munchies has applied for U.S. Trademark ~~application for~~protection the brand name Half-Baked as it relates to ~~various packaged~~certain categories of snacks. The Company also applied for, and was granted, trademark protection in the state of California for the name Half-Baked for snacks ~~and baked goods.~~containing THC. In addition, ~~the~~The Company acquired HalfBaked.com, and has secured other intellectual property in its portfolio. The Company intends to license this IP to operators in the ~~domain name HalfBaked.com. We believe this trademark~~cannabis edibles space and ~~domain will prove~~other related spaces.

DEVELOPMENT PLANS

Nightfood has nine ice cream flavors in ongoing production, and an additional ten products have been developed or in late stages of development. Management has also done preliminary research on CBD infused ice cream, current FDA guidelines do not permit CBD to be ~~very valuable~~used as an additive in conventional food. While Management has interest in such a development, it is likely such products will not be allowed under FDA guidelines for several quarters.

Nightfood is currently available in over 750 supermarket locations, and Management is expecting a meaningful increase in points of distribution in early 2021. Management believes that current marketing initiatives and existing sales velocity trends, along with securing the designation of being the Official Ice Cream of the American Pregnancy Association all bode well for securing additional expansion of the Nightfood brand.

Aggressive supermarket expansion could result in additional “slotting fees” either in 2021 or beyond. Slotting fees are normal and customary in the ~~coming months~~consumer goods industry and ~~years,~~are fees that certain retailers and distributors charge to introduce a new product into their available assortment.

In some cases, slotting fees, also called “new item placement fees” or “new item placement allowances” can be nominal. In other situations, slotting fees for certain retail and distribution partners could run hundreds of thousands of dollars.

Certain large retailers do not charge slotting fees, but most do. The Management of any emerging food or beverage brand could choose not to do business with retailers or distributors who charge slotting fees. Such a strategy, while possible, could greatly slow or restrict the distribution footprint a brand could establish.

Through the first two quarters of Fiscal 2021, slotting commitments have resulted in revenue reductions totalling $183,591. As of the time of this filing, over 60% of the way through our Fiscal 2021, Management projects slotting fees for the current Fiscal Year will deliver a total revenue reduction of less than $250,000. By comparison, slotting fees with in Fiscal 2020 resulted in total revenue reductions of $541,500. This significant decrease in slotting expense should not be viewed as an indication of a trend. Rather, it is simply a function of past slotting arrangements having been paid down and paid off, along with minimal new slotting fees anticipated during the ~~market~~current fiscal year. Investors should have the expectation that Nightfood, like any growing food or beverage brand, will continue to incur slotting fees as we move towards our goal of national distribution.

In addition to traditional retail such as supermarkets and big-box retailers, Management also believes significant opportunities exist in the hotel and hospitality vertical where ice cream is one of the top-selling categories in hotel lobby shops. With travelers wanting better sleep, Management believes hotels that sell ice cream would benefit by making Nightfood’s sleep-friendly ice cream part of their offering assortment. Before COVID, Management had been pursuing initiatives in the hotel space. While those were put on hold for ~~all things related to cannabis and marijuana continues to develop and mature.~~most of calendar 2020, hotels have now reemerged as an important point of focus for the distribution of Nightfood products.

INFLATION

Inflation can be expected to have an impact on our operating costs. A prolonged period of inflation could cause a general economic downturn and negatively impact our results. However, the effect of inflation has been minimal over the past three years.

SEASONALITY

There is a significant amount of seasonality in the ice cream industry, with summer months historically delivering the highest consumption, and winter months delivering the lowest consumption.

In the last twelve weeks of calendar 2020 (the period from 10/3/20 through 12/26/20), the syndicated industry data which management has access to shows aggregate supermarket ice cream pint retail sales down 16.6% from the prior twelve week period. This decrease of 16.6% is across all brands including private label ice cream.

The three leading brands in the better-for-you ice cream space saw sales decrease over 30% on average during this period, with the best performer of those three showing a drop of 26% from period to period, another had a drop of just over 30%, and the third dropped 33.5% from one twelve-week period to the next. During these same periods, Nightfood showed a decrease of 32%, right in line with the leaders in the better-for-you ice cream space.

As an early-stage and growing brand, the full impact of seasonality on our ice cream might not be fully understood for several additional annual cycles, but early indications point to the existence of a material seasonality impact across the ice cream industry through grocery channels. Over time, should the Company successfully expand into more distribution verticals and into additional snack formats, it is possible that the impacts of seasonality could lessen.

CORONAVIRUS (COVID-19)

The outbreak of the novel coronavirus (COVID-19), including the measures to reduce its spread, and the impact on the economy, cannot fully be understood and identified. Indications to date are that there are somewhat offsetting factors relating to the impact on our Company. Industry data shows that supermarket sales remain up, with more people spending more time at home. Anecdotally and statistically, snacking activity is also up while consumers are reporting a decrease in sleep quality and sleep satisfaction. Industry sales data also showed ice cream as one of the categories experiencing the largest increase with year over year growth averaging over 30% through a series of five one-week periods between March 15 and April 12, 2020 according to IRI data.

The offsetting factors are the impact of the virus on the overall economy, and the impact that a down economic period can have on consumer behavior, including trial of new brands. Greater unemployment, recession, and other possible unforeseen factors are shown to have an impact. Research indicates that consumers are less likely to try new brands during economic recession and stress, returning to the legacy brands they’ve known for decades.

With consumers generally making fewer shopping trips, while buying more on those occasions and reverting back to more familiar brands, certain brand-launch marketing tactics, such as in-store displays and in-store product sampling tables, are either impaired or impermissible. So, while overall night snacking demand is up, and consumer need/desire for better sleep is also stronger, driving consumer trial and adoption has been more difficult and expensive during these circumstances.

From both public statements, and ongoing exploratory meetings between Nightfood Management and experts from certain global food and beverage conglomerates, it has been affirmed to Management that there is increased strategic interest in the nighttime nutrition space as a potential high-growth opportunity, partially due to recent declines in consumer sleep quality and increases in at-home nighttime snacking.

We ~~do not believe~~have experienced no major issues with supply chain or logistics. Order processing function has been normal to date, and our manufacturers have assured us that their operations are “business as usual” as of the time of this filing.

It is possible that the fallout from the pandemic could make it more difficult in the future for the Company to access required growth capital, possibly rendering us unable to meet certain debts and expenses.

More directly, COVID has impaired Nightfood’s ability to execute certain in-store and out-of-store marketing initiatives. For example, since the inception of COVID, the Company was unable to conduct in-store demonstrations and unable to participate in local pregnancy, baby expos, and health expos that were originally intended to be part of our marketing mix.

Additionally, with more consumers shopping online, both for delivery or at-store pickup, the opportunity for shoppers to learn about new brands at-shelf has been somewhat diminished. Management is working to identify opportunities to build awareness and drive trial under these new circumstances.

It is impossible to know what the future holds with regard to the virus, both for our company and in the broader sense. There are many uncertainties regarding the current coronavirus pandemic, and the Company is closely monitoring the impact of the pandemic on all aspects of its business, including how it will ~~be seasonal~~impact its customers, vendors, and business partners. It is difficult to ~~any material degree.~~know if the pandemic has materially impacted the results of operations, and we are unable to predict the impact that COVID-19 will have on our financial position and operating results due to numerous uncertainties. The Company expects to continue to assess the evolving impact of the COVID-19 pandemic and intends to make adjustments accordingly, if necessary.

RESULTS OF OPERATIONS FOR THE THREE ~~AND~~MONTHS PERIOD ENDED

December 31, 2020 and 2019.

For the three months ended December 31, 2020 and 2019 we had Gross Sales of $142,863 and $185,751 and Net Revenues (Net Revenues are defined as Gross Sales, less Slotting Fees, Sales Discounts, and certain other revenue reductions) of $47,210 and $61,285 respectively and incurred an operating loss of $462,219 and $798,425 respectively. The decrease in Gross Sales, which represents sales of approximately 46,500 pints, and Net Revenue is largely the result of a significant decrease in advertising and promotional dollars spent during the quarter.

The Company made the strategic decision to decrease advertising and promotional spend to preserve inventory while awaiting production of the modified Nightfood formulation in updated packaging. This production was originally targeted for January, but the start of production ended up being delayed until mid-February, and is nearing completion as of the time of this filing. By strategically preserving inventory, the Company was able to avoid damaging out-of-stock situations with key retailers despite the delay in production. While we did run out of our most popular flavor in early February, Cookies n’ Dreams, only one retailer was impacted and the backorder is expected to be filled less than 10 days after the original requested delivery date.

The decrease in Advertising and Promotion activity is reflected in the decrease in Selling, General, and Administrative expense of $245,605, from $644,659 in the three months ended December 31, 2019 compared to $398,964 in the three months ended December 31, 2020, and is also reflected in the decrease in operating loss for the current quarter of $336,206, from $798,425 in the three months ended December 31, 2019 compared to $462,219 in the three months ended December 31, 2020.

In the last twelve weeks of calendar 2020 (the period from 10/3/20 through 12/26/20), the syndicated industry data management has access to shows aggregate supermarket ice cream pint retail sales down 16.6% from the prior twelve-week period. This decrease of 16.6% is across all brands including private label ice cream.

For the three months ended December 31, 2020 and 2019, Cost of Goods Sold increased to $110,465 from $48,475. A significant component of this increase was the write-off of $32,815 of packaging in inventory which featured the old Nightfood design and representing our old formulation. Management believes the new Nightfood recipes and package design will result in a material increase in consumer trial and repeat purchase and made the decision to accelerate the introduction of the new and improved product to market, rather than build additional inventory with the old design and formulations.

For the three months ended December 31, 2020 compared to the three months ended December 31, 2019, we also experienced changes in derivative liabilities to ($57,294) from ($165,563) and interest expense to $254,048 from $464,907. For the three months ended December 31, 2020, the Company recorded “other expenses” of $0 compared to $39,173 for the three months ended December 31, 2019.

	Three Months Ended December 31,
	2020			2019
Gross product sales	$	142,863		$	185,751
Less:
Slotting fees	$	(49,370	)	$	(112,710	)
Sales discounts, promotions, and other reductions		(46,283	)		(11,756	)
Net Revenues	$	47,210		$	61,285

RESULTS OF OPERATIONS FOR THE SIX MONTH PERIOD ENDED

December 31, ~~2017~~2020 and ~~December 31, 2016.~~

For the three months ended December 31, 2017 and December 31, 2016 we had revenues of $72,284 and $8,043 respectively and incurred an operating loss of $1,238,738 and $84,372 respectively. The revenue increases were the result of a Company focus on direct to consumer sales through the new NightFood.com website and having NightFood products listed on Amazon. A result of this increase in sales is an increase on cost of goods sold from $3,145 for the three months ending December 31, 2016 to $59,403 for the three months ending December 31, 2017. As part of the direct-to-consumer initiative, the Company chose to increase spending on advertising and related expenses, resulting in an increase from $438 for the three months ending December 31, 2016 to $60,548 for the three months ending December 31, 2017. SG&A increased from $5,755 for the three months ending December 31, 2016 to $172,644 for the three months ending December 31, 2017, and this increase was largely attributable to the buildout and completion of the new NightFood.com website and video assets, along with an increase in investor relations activities. Professional fees increased from $83,040 for the three months ending December 31, 2016 to $215,524 for the three months ending December 31, 2017, with much of this increase resulting from expenses relating to capital raises to fund operations and refinance of preexisting Company debt. For the three months ended December 31, 2017 compared to the three months ended December 31, 2016, we also experienced increases in derivative liabilities (from $0 to $147,546) and interest expense (from $0 to $190,936).For the three months ended December 31, 2017, the Company recorded other expenses of $463,146 compared to $0 for the three months ended December 31, 2016. These other expenses consist of non-cash items primarily of $463,146 in amortization of debt discount and deferred financing fees. These are all a direct result of the Company tapping into available sources of capital to begin on the path of significant revenue growth and investor awareness. Although no assurances can be given, management believes that the positive results of these efforts will lead to more efficient sources of capital in the form of more favorable terms from existing investors, and allow the Company to grow the NightFood brand and revenues in a meaningful way, ultimately increasing shareholder value.2019.

For the six months ended December 31, ~~2017~~2020 and ~~December 31, 2016~~2019 we had ~~revenues~~Gross Sales of ~~$108,726~~$462,187 and ~~$10,507~~$385,155 and Net Revenues (Net Revenues are defined as Gross Sales, less Slotting Fees, Sales Discounts, and certain other revenue reductions) of $174,193 and $107,782 respectively and incurred an operating loss of ~~$2,218,513~~$998,261 and ~~$158,538~~$1,093,202 respectively. The ~~revenue increases were~~increase in Gross Sales and Net Revenue is largely the result of having product available in many more points of retail distribution this year than last. We had Selling, General, and Administrative expense of $832,293, from $672,676 for the six months ended December 31, 2020 and 2019, and operating losses of $998,261 and $1,093,202 for the six months ended December 31, 2020 and 2019

Accounting standards require exclusion on the income statement of Gross Sales made to a customer to whom the Company ~~focus~~is paying slotting fees (slotting fees are fees occasionally charged by retailers and distributors to add a new product into their product assortment). In those situations, the Gross Sales number is reduced, dollar for dollar, by the slotting fees, until the total cost of the slotting is covered. These slotting fees do not appear on ~~direct~~the income statement as an expense. Rather, Slotting Fees, along with Sales Discounts, are applied against Gross Sales, resulting in Net Revenue, as shown below. The netting of Gross Sales against slotting and sales discounts, as described and shown below, results in the Net Revenue number at the top of the income statement. This is not a reflection of the amount of product shipped to ~~consumer~~customers, but rather a function of the way certain sales ~~through~~are accounted for when those sales are made to customers who are charging slotting fees.

The following tables summarize Gross Sales for the ~~new NightFood.com website~~six months ended December 31, 2020 and ~~having NightFood products listed~~2019. Product sales are net of slotting fees (a typically one-time fee charged by supermarkets in order to have the product placed on ~~Amazon. A result of this increase in~~their shelves) and sales ~~is an increase on~~discounts.

	Six Months Ended December 31,
	2020			2019
Gross product sales	$	462,187		$	385,155
Less:
Slotting fees	$	(183,591	)	$	(268,860	)
Sales discounts, promotions, and other reductions		(104,402	)		(8,513	)
Net Revenues	$	174,193		$	107,782

The Company had cost of goods sold of $340,161 and $194,975 for the six months ended December 31, 2020 and 2019. This increase was largely due to significantly more product sold this year than last, along with the write-off of $32,815 of packaging in inventory which featured the old Nightfood design and representing our old formulation. Management believes the new Nightfood recipes and package design will result in a material increase in consumer trial and repeat purchase and made the decision to accelerate the introduction of the new and improved product to market, rather than build additional inventory with the old design and formulations.

Our income statement shows Selling, General, and Administrative expenses of $832,293 and $672,676 for the six months ended December 31, 2020 and 2019. This increase is due to the way certain marketing expenses were accounted for. Further, as discussed on footnote 3, due to reclassification, $458,639 in expenses were reversed and set off with the advertising costs incurred during 2019."The Company had invested approximately $396,047 in marketing and distribution partnerships it determined would benefit operations for 2020 and beyond. Due to circumstances, including the global COVID-19 coronavirus pandemic, it does not appear these distribution partnerships will be as beneficial to the Company as envisioned when entered. This category includes expenses such as web hosting, web services, freight, warehousing, shipping, product liability insurance, investor relations and research & development of new products. Professional fees increased from ~~$15,246~~$266,998 for the six months ending December 31, ~~2016~~2019 to ~~$85,429~~$385,510 for the six months ending December 31, ~~2017. As part~~2020. $65,700 of the ~~direct-to-consumer initiative,~~professional fees in the current six-month period are the result of accounting for 500,000 warrants issued to a Company chose to increase spending on advertising and related expenses, resulting in an increase from $1,058 for the six months ending December 31, 2016 to $102,372 for the six months ending December 31, 2017. SG&A increased from $18,031 for the six months ending December 31, 2016 to $315,984 for the six months ending December 31, 2017, and this increase was largely attributable to the buildout and completionconsultant with a strike price of the new NightFood.com website and video assets, along with an increase in investor relations activities. Professional fees increased from $129,372 for the six months ending December 31, 2016 to $472,782 for the six months ending December 31, 2017, with much of this increase resulting from expenses relating to capital raises to fund operations and refinance of preexisting Company debt. $.50.

For the six months ended December 31, ~~2017~~2019 we experienced an increase in Loss on extinguishment of debt upon notes conversion of $0 compared to $2,216 in the six months ended December 31, 2020. For the six months ended December 31, 2019 compared to the six months ended December 31, ~~2016,~~2020, we also experienced ~~increases~~changes in derivative liabilities ~~(from $0~~from ($355,625) to ~~$250,465)~~($264,818) and total interest expense ~~(from $0~~from $873,772 to ~~$444,441).~~$772,317. For the six months ended December 31, ~~2017,~~2019, the Company recorded ~~other expenses~~“other expenses” of ~~$651,778~~$39,173 compared to $0$19,877 for the six months ended December 31, 2016. These other expenses consist of non-cash items primarily of $679,714 in amortization of debt discount and deferred financing fees and a credit of $27,936. These are all a direct result of the Company tapping into available sources of capital to begin on the path of significant revenue growth and investor awareness. Although no assurances can be given, management believes that the positive results of these efforts will lead to more efficient sources of capital in the form of more favorable terms from existing investors, and allow the Company to grow the NightFood brand and revenues in a meaningful way, ultimately increasing shareholder value.2020.

Customers

~~For~~During the six months ended December 31, 2020, the Company had one customer account for approximately 33% of the gross sales. One other customer accounted for approximately 19% of gross sales, and one other customer accounted for over 10% of gross sales. During the six months ended December 31, 2019, one customer accounted for approximately 34% of the gross sales while two other customers accounted for over 10% of gross sales.

During the three ~~month period ending~~months ended December 31, ~~2017,~~2020, the ~~majority~~Company had one customer account for approximately 25% of ~~revenues resulted from~~the gross sales. One other customer accounted for approximately 20% of gross sales, and two other customers accounted for over 10% of ~~NightFood direct to consumer through~~gross sales. During the ~~NightFood.com website and Amazon’s Fulfilled by Amazon program.~~three months ended December 31, 2019, one customer accounted for approximately 34% of the gross sales while three other customers accounted for over 10% of gross sales.

LIQUIDITY AND CAPITAL RESOURCES

As of December 31, ~~2017,~~2020, we had cash on hand of ~~$12,322~~$117,538, receivables of $41,290 and inventory value of ~~$10,115.~~$166,041.

The Company has limited available cash resources and we do not believe our cash on hand will be adequate to satisfy our ongoing working capital needs. The Company is continuing to raise capital through private placement of our common stock and through the use of convertible notes to finance the Company’s operations, of which it can give no assurance of success. However, the Company has a strong ongoing relationship with Eagle Equities and we expect to be able to fund our projected growth over the next several quarters. We believe that our current capitalization structure, combined with ~~the continued revenue~~ongoing increases in revenues and distribution, will enable us to ~~achieve successful financings~~successfully secure required financing to continue our growth. In the short term, the Company plans to continue to take advantage of convertible notes as a financing vehicle while other financing options are being evaluated and explored.

Because the business ~~is new and~~ has limited operating history and ~~relatively few~~ sales, no certainty of continuation can be stated. ~~Management is taking steps to raise additional funds to address its operating and financial cash requirements to continue operations in the next twelve months.~~ Management has devoted a significant amount of time in the raising of capital from additional debt and equity financing. However, the Company’s ability to continue as a going concern is dependent upon raising additional funds through debt and equity financing and generating revenue. There are no assurances the Company will receive the necessary funding or generate revenue necessary to fund operations.

Even if the Company is successful in raising additional funds, the Company cannot give any assurance that it will, in the future, be able to achieve a level of profitability from the sale of its products to sustain its operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effects on recoverability and reclassification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

Since our inception, we have sustained operating losses. During the six months ended December 31, ~~2017,~~2020, we incurred a net loss of ~~$2,218,513~~$1,542,528 compared to ~~$158,538~~$1,650,522 for the six months ended December 31, ~~2016.~~2019. Much of this loss is largely a function of the way certain financing activities are recorded, and does not represent actual operating losses.

During the six months ended December 31, ~~2017,~~2020, net cash used in operating activities was ~~$856,918~~$617,879 compared to ~~$29,633~~$899,563 for the six months ended December 31, ~~2016. The majority~~2019. Much of what shows as “net cash used in operating activities” is related to non-cash items associated with to the ongoing capitalization of the Company during the reporting period.

During the six months ended December 31, ~~2017,~~2020, net cash of $0 was used in investing activities, compared to $333,333 for the six months ended December 31, 2019.

During the six months ended December 31, 2020, net cash aggregating ~~$854,914~~$537,795 was provided by financing ~~activities. Much of this financing activity related~~activities, compared to ~~a restructuring of pre-existing debts, and consolidation of~~$1,350,000 for the ~~majority of debt with a single investor at a lower interest rate and similar conversion terms.~~

six months ended December 31, 2019.

From our inception in January 2010 through December 31, ~~2017,~~2020, we have generated an accumulated deficit of approximately ~~$5,599,734,~~$19,173,651, compared to ~~$3,381,221~~$17,631,122 from inception through June 30, ~~2017.~~2020. Assuming we raise additional funds and continue operations, we expect to incur additional operating losses during the next two to ~~three~~six quarters and possibly thereafter. We plan to continue to pay or satisfy existing obligation and commitments and finance our operations, as we have in the past, primarily through the sale of our securities and other forms of external financing until such time that we are able to generate sufficient funds from the sale of our products to finance our operations, of which we can give no assurance.

On November 25, 2016, the company entered into a material definitive agreement. On that date, the company executed and delivered a Plan of Reorganization Including Option to Acquire (the “Plan”) by and among the Registrant, Hook Group, LLC (“Hook”) and Suffield Foods. LLC (“Suffield”). The Plan contemplates the Registrant acquiring an equity interest in and potentially merging Hook and its subsidiary Suffield with and into a wholly owned subsidiary of the Registrant. As of the date of this filing, the agreement has been formally terminated by the Registrant.

As of February 8, 2017, we entered into two agreements with Black Forest, an Equity Purchase Agreement (the “EPA”) and a Registration Rights Agreement (the “RRA”). The two agreements were filed as exhibits to the Registrant’s Current Report on Form 8-K dated February 8, 2017, and this Registration Statement is being filed in order for us to fulfill our obligations under the RRA. The following summary is qualified in its entirety by reference to such exhibits to our Form 8-K. On August 24, 2017, the Company issued its first and, to date, only “put notice” to Black Forest and delivered Black Forest 264,085 shares of common stock in exchange for $30,000. On October 23, 2017, we were advised that our stock has been moved from the OTCQB to the OTCPink marketplace. We may not utilize the EPA facility during the time quoted on the OTCPink. The Company does not believe the change in OTC Market tiers will have any material positive or negative impact on Company operations. If, the Company determines that there is incremental value in being listed on the OTCQB, it is possible that another tier change could occur in the future. Accordingly, future utilization of the EPA is uncertain.

During calendar 2017, through the date of this filing, the Company entered into convertible promissory notes with several lenders totaling approximately $1,600,000 Among these notes were promissory notes totaling $120,000 with Black Forest which notes have been assigned to a third party that is not affiliated with Black Forest. During the past several months, the Company has successfully consolidated most of its outstanding notes with a single investor who, although there is no written commitment to do so, management believes will continue to provide funding for operations.

The agreements with Black Forest required us to file a registration statement for the common stock underlying the EPA. Subject to various limitations set forth in the EPA, Black Forest, after effectiveness of such registration statement, will be required to purchase up to $5,000,000 worth of our common stock at a price equal to 85% of the market price as determined under the EPA. The EPA provides for volume limitations on the amount of shares that Black Forest must purchase at any time and provides that we will be paid for the common stock upon electronic delivery of the shares to Black Forest. To date we have raised a net of $28,260.50 through the EPA. No assurance can be given as to the total amount we will raise through the EPA.

We intend to rely on the sale of stock ~~in private placements,~~ and the issuance of ~~more~~new debt, to fund our operations. If we are unable to raise cash through the sale of our stock, we may be required to severely restrict our operations.

The Company has received several tranches of capital from a friendly institutional investor, who has been our primary source of capital for the last 41 months. We ~~have entered into other notes as disclosed on our Current Reports on Form 8-K filed on September 20, 2017, and in our Annual Report on Form 10K, filed on October 3, 2017.~~expect this investor to continue to fund ongoing operations

Effective May 6, 2015, the Company entered into a consulting agreement with Sean Folkson. The agreement iswas retroactive to January 1st, 2015. In exchange for services provided to the Company by Folkson, the Company ~~has~~ agreed to pay Folkson $6,000 monthly. This compensation expense started accruing on January 1, 2015, and ~~will continue to accrue~~accrued on a monthly basis ~~until~~through June of 2018.

In June of 2018, and again in June of 2019, the ~~company~~Company entered into updated consulting agreements with Folkson, which included a modified compensation structure. Each new Consulting Agreement contained the identical cash compensation allowance of $6,000 monthly. In addition, Folkson would earn Warrants with a strike price of $.50 or $1 when the Company hit certain revenue milestones, such as when the Company records its first quarter with revenue greater than $1,000,000. All Warrants earned under Folkson’s current agreement would convert into restricted shares, shall carry a cashless provision, and must be exercised within 90 days of the filing of the 10Q or 10K on which such revenues are reported. The Agreement from June of 2019 ran through the end of December of 2020, at which time a new Agreement was executed between the parties. All terms were identical with the exception that additional milestones were added by which Folkson would earn $.50 warrants. These included a milestone of $500,000 in net revenue during calendar 2021 from nontraditional retail channels (such as hotels and college campuses), and a warrant bonus should Folkson successfully negotiation a product development or distribution partnership with a multi-national food & beverage conglomerate during the Term of the Agreement.

On October 12, 2018, Folkson opted to purchase 400,000 shares of common stock at $.30 per share, by exercising warrants. To make this purchase, Folkson used $120,000 in accrued Nightfood consulting fees.

On February 4, 2019, the Company entered into a “Lock-Up” Agreement with Folkson whereby Folkson agreed to not transfer, sell, or otherwise dispose of any shares of his NGTF stock during the next twelve months. As part of this agreement, Folkson received warrants to acquire 400,000 shares of NGTF common stock at an exercise price of $.30 per share. All warrants in this agreement carried a twelve month term and a cashless provision, and were to expire if not exercised within the twelve month term. Folkson did not have rights to transfer, sell, or otherwise dispose of these warrants at any time, as there were no transfer rights provided for in the Agreement. The warrants that were part of the February 2019 Lock Up Agreement expired unexercised, as the share price was below $.30 at the end of the Agreement.

On January 20, 2020, Folkson and the Company entered into a new Lock-Up Agreement which went into effect on February 4, 2020 and is in place for twelve months, with identical financial terms to the February 4, 2019 Agreement.

On January 21, 2021, Folkson and the Company entered into a ~~position~~new Lock-Up Agreement which went into effect on February 4, 2020 and is in place for twelve months, with identical financial terms to ~~pay Folkson. As~~the February 4, 2019 Agreement.

The foregoing accounts for the entirety of compensation earned by Folkson since inception.

On February 6, 2019, the ~~date~~Registrant entered into a “Leak-Out” Agreement with Peter Leighton, former affiliate and owner of ~~this filing, three payments have been made~~4,000,000 shares, which will restrict Leighton’s ability to ~~Folkson against this accrual.~~sell, transfer, or otherwise dispose of his shares above a certain, mutually agreed-upon monthly threshold.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations is based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these unaudited condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent liabilities. On an on-going basis, we evaluate past judgments and our estimates, including those related to allowance for doubtful accounts, allowance for inventory write-downs and write offs, deferred income taxes, provision for contractual obligations and our ability to continue as a going concern. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Note 2 to the consolidated financial statements, presented in our Annual Report on Form 10-K for the fiscal year ended June 30, ~~2017,~~2020, describe the significant accounting estimates and policies used in preparation of our consolidated financial statements. There were no significant changes in our critical accounting estimates during the six months ended December 31, ~~2017.~~2020.

OFF BALANCE SHEET ARRANGEMENTS

None.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

No report required.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Disclosure and control procedures are also designed to ensure that such information is accumulated and communicated to management, including the chief executive officer and chief financial officer, to allow timely decisions regarding required disclosures.

We carried out an evaluation, under the supervision and with the participation of management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, ~~2017.~~2020. In designing and evaluating the disclosure controls and procedures, management recognizes that there are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their desired control objectives. Additionally, in evaluating and implementing possible controls and procedures, management is required to apply its reasonable judgment. Based on the evaluation described above, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this report because we did not document our Sarbanes-Oxley Act Section 404 internal controls and procedures.

As funds become available to us, we expect to implement additional measures to improve disclosure controls and procedures such as implementing and documenting our internal controls procedures.

Changes in internal controls over financial reporting

There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

Limitations on the Effectiveness of Controls

A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The Company’s management, including its Principal Executive Officer and its Principal Financial Officer, do not expect that the Company’s disclosure controls will prevent or detect all errors and all fraud. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with associated policies or procedures. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

We are not engaged in any litigation at the present time, and management is unaware of any claims or complaints that could result in future litigation. Management will seek to minimize disputes with its customers but recognizes the inevitability of legal action in today’s business environment as an unfortunate price of conducting business.

ITEM 1A. RISK FACTORS.

Not required for smaller reporting companies.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS.

Exhibit		Exhibit Description

31.1		Rule 13a-14(a)/15d-14(a) certification of Chief Executive Officer

32.1		Section 1350 certification of Chief Executive Officer

101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

SIGNATURES

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

	~~NightFood~~Nightfood Holdings, Inc.

Dated: February ~~16, 2018~~22, 2021	By:	/s/ Sean Folkson
		Sean Folkson, Chief Executive Officer (Principal Executive, Financial and Accounting Officer)

Nevada		46-3885019
(State or Other Jurisdiction of		(I.R.S. Employer
Incorporation or Organization)		Identification No.)

520 White Plains Road, Suite 500 Tarrytown, New York		10591
(Address of Principal Executive Offices)		(Zip Code)

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐ ~~(Do not check if a smaller reporting company)~~	Smaller reporting company	☒
		Emerging growth company	☐

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Nightfood Holdings, Inc Common Stock		NGTF		OTCQB

PART I – FINANCIAL INFORMATION

Item 1.	Financial ~~Statements.~~Statements (Unaudited)	1

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

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	69

Item 4.	Controls and Procedures.	69

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings.	710

Item 1A.	Risk Factors.	710

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	710

Item 3.	Defaults Upon Senior Securities.	710

Item 4.	Mine Safety Disclosures.	710

Item 5.	Other Information.	710

Item 6.	Exhibits.	710

Signatures		811

Financial Statements
Condensed Consolidated Balance Sheets as of December 31, ~~2017~~2020 (Unaudited) and June 30, ~~2017~~2020		F-1
Unaudited Condensed Consolidated ~~Statement~~Statements of Operations for the three months and six months ended December 31, ~~2017~~2020 and ~~2016~~2019		F-2
Unaudited Condensed Consolidated ~~Statement~~Statements of Changes in Stockholders’ Deficit for the three months and six months ended December 31, 2020 and 2019		F-3
Unaudited Condensed Consolidated Statements of Cash Flows for the six months ended December 31, ~~2017~~2020 and ~~2016~~2019		~~F-3~~F-4
Notes to Unaudited Condensed Consolidated Financial Statements		~~F-4~~F-5 - ~~F-15~~F-23

	For the six months ended December 31, 2017			For the six months ended December 31, 2016			For the three months ended December 31, 2017			For the three months ended December 31, 2016
Revenues	$	108,726		$	10,507		$	72,284		$	8,043

Operating expenses
Cost of product sold		85,429			15,246			59,403			3,145
Advertising and promotional		102,372			1,058			60,548			438
Selling, general and administrative		315,984			18,031			172,644			5,755
Professional Fees		472,782			129,372			215,542			83,040
Total operating expenses		976,567			163,707			508,137			92,378

Loss from operations		(867,841	)		(153,200	)		(435,853	)		(84,335	)

Interest expense – bank debt		-			338			-			37
Interest expense - shareholder		3,988			5,000			1,257			-
Change in derivative liability		250,465			-			147,546			-
Interest expense - other		444,441			-			190,936			-
Other expense		651,778			-			463,146			-
Total other expense		1,350,672			5,338			802,885			37

Provision for income tax		-			-			-			-

Net loss	$	(2,218,513	)	$	(158,538	)	$	(1,238,738	)	$	(84,372	)

Basic and diluted net loss per common share	$	(0.07	)	$	(0.01	)	$	(0.04	)	$	(0.00	)

Weighted average shares of capital outstanding – basic and diluted		31,846,459			28,552,706			33,172,996			28,585,220

	December 31, 2017		June 30, 2017
Finished Goods	$	10,115	$	87,676
Packaging		-		8,189
TOTAL	$	10,115	$	95,865

	December 31, 2017		June 30, 2017
Vendor deposits - Bars		52,416		-
Vendor deposits - Packaging		18,402		-
Vendor deposits - Other		4,150		3,491
TOTAL	$	74,968	$	3,491

Convertible notes payable issued as of June 30, 2017	$	430,000
Convertible notes payable issued as of December 31, 2017	$	884,093
Unamortized amortization of debt and beneficial conversion feature		(703,101	)
Notes paid		(75,000	)
Notes converted into shares of common stock		(117,000	)
Balance at December 31, 2017	$	418,992

	December 31, 2017			June 30, 2017
Bank loan	$	2,000		$	3,096
Total borrowings		2,000			3,096
Less: current portion		(2,000	)		(3,096	)
Long term debt	$	-		$	-