UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

		For the quarterly period ended September 30, ~~2020~~2021

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

		For the transition period from _______________________to___________________________

Commission File Number: 000-11882

B2Digital, Incorporated

(Exact name of registrant as specified in its charter)

Delaware	84-0916299
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

4522 West Village Drive, Suite 215, Tampa, FL	33624
(Address of principal executive offices)	(Zip Code)

(813)961-3051

(Registrant’s telephone number, including area code)

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

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 12b-2 of the Exchange Act). Yes ☐No☒

Securities registered pursuant to section 12(b) of the Act:

Title of Each Class		Trading Symbol(s)		Name of each exchange on which registered
Not applicable		Not applicable		Not applicable

The number of shares outstanding of the registrant’s common stock, par value of $0.00001 on November ~~2, 2020,~~15, 2021, was ~~707,413,262.~~1,496,740,840.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION	3
Item 1. Financial Statements.	3
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.	426
Item 3. Quantitative and Qualitative Disclosures About Market Risk.	1337
Item 4. Controls and Procedures.	1337

PART II—OTHER INFORMATION	1438
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.	14
~~Item 6.~~ ~~exhibits.~~	1438
~~SIGNATURES~~Item 6. exhibits.	1538
SIGNATURES	39

PART I - FINANCIAL INFORMATION

Item 1.

Financial Statements.

~~Consolidated Financial Statements~~

B2Digital, Incorporated

Consolidated Balance Sheets

		~~Page~~
~~Consolidated Balance Sheets as of September 30, 2020 (unaudited) and March 31, 2020~~		~~F-1~~

~~Consolidated Statements of Operations (unaudited) for the three and six months ended September 30, 2020 and 2019~~		~~F-2~~

~~Consolidated Statements of Stockholders’ Deficit (unaudited) for the three and six months ended September 30, 2020~~		~~F-3~~

~~Consolidated Statements of Stockholders’ Deficit (unaudited) for the three and six months ended September 30, 2019~~		~~F-4~~

~~Consolidated Statements of Cash Flows (unaudited) for the six months ended September 30, 2020 and 2019~~		~~F-5~~

~~Notes to the Unaudited Consolidated Financial Statements~~		~~F-6~~


	As of September 30, 2021			As of March 31, 2021
Assets
Current assets
Cash and cash equivalents	$	273,912		$	122,176
Deposits and prepaid expenses		80,794			10,681
Total current assets		354,706			132,857

Notes receivable & other receivables		43,947			35,400
Operating lease right-of-use asset		2,040,053			1,575,792
Property and equipment, net of accumulated depreciation		1,144,177			944,999
Intangible assets, net of accumulated amortization		218,823			224,890
Total Assets	$	3,801,706		$	2,913,938

Liabilities & Stockholders' Deficit
Current liabilities
Accounts payable & accrued liabilities	$	367,495		$	213,663
Deferred revenue		88,880			119,504
Note payable- current maturity		295,600			158,200
Note payable- in default		14,000			14,000
Payable due for business acquisitions		0			40,000
Convertible notes payable, net of debt discount		3,012,419			1,074,733
Derivative liabilities		1,763,093			1,137,623
Lease liability, current		387,311			264,165
Due to shareholder		14,950			0
Total current liabilities		5,943,748			3,021,888

Lease liability, long-term		1,713,402			1,319,457
Note payable- long-term		90,685			105,929

Total Liabilities		7,747,835			4,447,274

Commitments and contingencies (Note 13)

Stockholders' Deficit
Preferred stock, 50,000,000 shares authorized, 8,000,000 shares are undesignated
Series A: 2,000,000 shares convertible into 240 shares of common stock issued and outstanding at September 30, 2021 and March 31, 2021, respectively.		20			20
Series B: 40,000,000 shares convertible into 80,000,000 shares of common stock issued and outstanding at September 30, 2021 and March 31, 2021, respectively.		400			400
Common stock, $0.00001 par value; 5,000,000,000 shares authorized; 1,381,890,550 and 1,081,390,550 shares issued and outstanding at September 30, 2021 and March 31, 2021, respectively		13,820			10,815
Additional paid in capital		8,855,402			7,652,677
Accumulated deficit		(12,815,771	)		(9,197,248	)
Total Stockholders' Deficit	$	(3,946,129	)	$	(1,533,336	)
Total Liabilities and Stockholders' Deficit	$	3,801,706		$	2,913,938

See accompanying notes to the unaudited consolidated financial statements.

B2Digital, Incorporated

~~Consolidated Balance Sheets~~

As of
September 30,
2020 As of
March 31,
2020
Assets
Current assets
Cash and cash equivalents $ 61,571 $ 46,729
Inventory 1,445 7,256
Deposits and prepaid expenses 5,445 3,120
Total current assets 68,461 57,105

Property and equipment, net of accumulated depreciation 428,168 351,393
Intangible assets, net of accumulated amortization 181,353 196,951
Goodwill 172,254 172,254
Total Assets $ 850,236 $ 777,703

Liabilities & Stockholders' Deficit
Current liabilities
Accounts payable & accrued liabilities $ 162,309 $ 131,700
Deferred revenue 40,588 13,992
Note payable- current maturity 122,800 34,162
Note payable- in default 14,000 –
Payable due for business acquisitions – 15,000
Convertible notes payable 726,953 598,150
Derivative liabilities 599,454 58,790
Due to shareholder 241 711
Total current liabilities 1,666,345 852,505

Note payable- long-term 115,327 136,565

Total Liabilities 1,781,672 989,070

Commitments and contingencies (Note 13)

Stockholders' Deficit
Preferred stock, 50,000,000 shares authorized, 40,000,000 shares of Series B designated and none outstanding; 2,000,000 shares of Series A, convertible into 240 shares of common stock issued and outstanding at September 30, 2020 and March 31, 2020, respectively; 8,000,000 shares are undesignated 20 20
Common stock, $0.00001 par value; 5,000,000,000 shares authorized; 658,957,259 and 539,267,304 shares issued and outstanding at September 30, 2020 and March 31, 2020, respectively 6,590 5,394
Additional paid in capital 4,643,791 3,600,197
Accumulated deficit (5,581,837 ) (3,816,978 )
Total Stockholders' Deficit (931,436 ) (211,367 )
Total Liabilities and Stockholders' Deficit $ 850,236 $ 777,703

~~See accompanying notes to the unaudited consolidated financial statements.~~

~~F-1~~

~~B2 Digital, Incorporated~~

Consolidated Statements of Operations (Unaudited)

For the three months ended For the six months ended
September 30, September 30, September 30, September 30,
2020 2019 2020 2019
Revenue:
Live event revenue $ 30,318 $ 96,275 $ 30,377 $ 181,911
Gym revenue 105,609 – 165,571 –
Total revenue 135,927 96,275 195,948 181,911

Cost of sales 47,907 73,588 49,219 135,540

Gross profit 88,020 22,687 146,729 46,371

General and administrative corporate expenses
General & administrative expenses 675,129 349,297 839,917 859,810
Depreciation and amortization expense 33,883 6,741 66,855 10,053
Total general and administrative corporate expenses 709,012 356,038 906,772 869,863

Loss from continuing operations (620,992 ) (333,351 ) (760,043 ) (823,492 )

Other income (expense):
Gain on forgiveness of loan 5,040 – 10,080 –
Grant income – – 2,000 –
Loss on settlement of debt – – (18,281 ) –
Loss on forgiveness of notes receivable – (27,000 ) – (27,000 )
Loss on modification of debt – (50,756 ) – (50,756 )
Loss on extinguishment of debt (64,194 ) – (64,194 ) –
Change in fair value of derivatives (511,975 ) – (787,407 ) –
Interest expense (77,232 ) (2,308 ) (147,014 ) (3,679 )
Total other income (expense) (648,361 ) (80,064 ) (1,004,816 ) (81,435 )

Net loss $ (1,269,353 ) $ (413,415 ) $ (1,764,859 ) $ (904,927 )

Basic and diluted earnings per share on net loss $ (0.00 ) $ (0.00 ) $ (0.00 ) $ (0.00 )

Weighted average shares outstanding 597,871,392 528,339,793 574,198,491 471,101,799

~~See accompanying notes to the unaudited consolidated financial statements.~~

~~F-2~~

~~B2 Digital, Incorporated~~

~~Consolidated Statement of Changes in Stockholders' Deficit~~

~~For the Three and Six Months Ended September 30, 2020 (Unaudited)~~

Preferred Stock Common Stock Additional
Paid in Accumulated
Shares Amount Shares Amount Capital Deficit Total
Balance March 31, 2020 2,000,000 20 539,267,304 $ 5,394 $ 3,600,197 $ (3,816,978 ) $ (211,367 )

Issuance of common stock for services – – 4,000,000 40 14,360 – 14,400

Conversion of notes payable – – 16,292,915 163 55,459 – 55,622

Net loss – – – – – (495,506 ) (495,506 )

Balance June 30, 2020 2,000,000 20 559,560,219 5,597 3,670,016 (4,312,484 ) (636,851 )

Sale of common stock – – 62,000,002 620 464,380 – 465,000

Issuance of common stock for services – – 11,733,333 117 74,816 – 74,933

Conversion of notes payable – – 25,663,705 256 434,579 – 434,835

Net loss – – – – – (1,269,353 ) (1,269,353 )

Balance September 30, 2020 2,000,000 20 658,957,259 $ 6,590 $ 4,643,791 $ (5,581,837 ) $ (931,436 )


	For the three months ended						For the six months ended
	September 30,			September 30,			September 30,			September 30,
	2021			2020			2021			2020
Revenue:
Live event revenue	$	283,171		$	30,318		$	518,762		$	30,377
Gym revenue		376,839			105,609			710,013			165,571
Total revenue		660,010			135,927			1,228,775			195,948

Cost of sales		327,682			47,907			531,184			49,219

Gross profit		332,328			88,020			697,591			146,729

General and administrative corporate expenses
General & administrative expenses		1,854,487			675,129			3,408,367			839,917
Depreciation and amortization expense		98,470			33,883			186,519			66,855
Total general and administrative corporate expenses		1,952,957			709,012			3,594,886			906,772

Loss from continuing operations		(1,620,629	)		(620,992	)		(2,897,295	)		(760,043	)

Other income (expense):
Gain on forgiveness of loan		0			5,040			23,303			10,080
Loss on sale of assets		(1,757	)		0			(1,527	)		0
Grant income		0			0			0			2,000
Loss on settlement of debt		0			0			0			(18,281	)
Loss on forgiveness of notes receivable		(2,094	)		0			(2,094	)		0
Gain (Loss) on extinguishment of debt		55,925			(64,194	)		136,666			(64,194	)
Change in fair value of derivatives		(665,813	)		(511,975	)		(354,942	)		(787,407	)
Interest expense		(322,808	)		(77,232	)		(522,634	)		(147,014	)
Total other expense		(936,547	)		(648,361	)		(721,228	)		(1,004,816	)

Net loss	$	(2,557,176	)	$	(1,269,353	)	$	(3,618,523	)	$	(1,764,859	)

Basic and diluted earnings per share on net loss	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)

Weighted average shares outstanding		1,369,390,550			597,871,392			1,289,383,719			574,198,491

See accompanying notes to the unaudited consolidated financial statements.

~~F-3~~4

B2Digital, Incorporated

~~B2 Digital, Incorporated~~

Consolidated Statement of Changes in Stockholders' ~~Equity~~Deficit

For the Three and Six Months Ended September 30, ~~2019~~2021 and 2020 (Unaudited)

Preferred Stock Common Stock Additional
Paid in Accumulated
Shares Amount Shares Amount Capital Deficit Total
Balance March 31, 2019 2,000,000 20 377,620,110 $ 3,776 2,624,573 (2,479,631 ) $ 148,738

Sale of common stock – – 13,281,250 133 84,867 – 85,000

Issuance of common stock for services – – 71,000,000 710 453,690 – 454,400

Issuance of common stock as part of business combination – – 14,000,000 140 89,460 – 89,600

Net Loss – – – – – (491,512 ) (491,512 )

Balance June 30, 2019 2,000,000 20 475,901,360 4,759 3,252,590 (2,971,143 ) 286,226

Sale of common stock – – 49,218,750 492 314,508 – 315,000

Issuance of common stock for services – – 36,500,000 365 233,235 – 233,600

Issuance of common stock as part of business combination – – 9,000,000 90 57,510 – 57,600

Cancellation of outstanding shares in exchange cancellation of notes receivable - related party – – (7,500,000 ) (75 ) (47,925 ) – (48,000 )

Loss from modification of debt – – – – 50,756 – 50,756

Net loss – – – – – (413,415 ) (413,415 )

Balance September 30, 2019 2,000,000 20 563,120,110 $ 5,631 3,860,674 (3,384,558 ) $ 481,767


	Preferred Stock				Preferred Stock								Additional					Total
	Series A				Series B					Common Stock			Paid in		Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Shares		Amount		Capital		Deficit			Deficit
Balance March 31, 2021		2,000,000	$	20		40,000,000	$	400		1,081,390,550	$	10,815	$	7,652,677	$	(9,197,248	)	$	(1,533,336	)
Sale of common stock		–		–		–		–		220,000,000		2,200		877,800		–			880,000
Issuance of common stock for services		–		–		–		–		5,500,000		55		23,595		–			23,650
Issuance of convertible notes		–		–		–		–		–		–		2,080		–			2,080
Net loss		–		–		–		–		–		–		–		(1,061,347	)		(1,061,347	)
Balance June 30, 2021		2,000,000	$	20		40,000,000	$	400		1,306,890,550	$	13,070	$	8,556,152	$	(10,258,595	)	$	(1,688,953	)
Sale of common stock		–		–		–		–		75,000,000		750		299,250		–			300,000
Net loss		–		–		–		–		–		–		–		(2,557,176	)		(2,557,176	)
Balance September 30, 2021		2,000,000	$	20		40,000,000	$	400		1,381,890,550	$	13,820	$	8,855,402	$	(12,815,771	)	$	(3,946,129	)

	Preferred Stock				Preferred Stock								Additional					Total
	Series A				Series B					Common Stock			Paid in		Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Shares		Amount		Capital		Deficit			Deficit
Balance March 31, 2020		2,000,000	$	20		–	$	–		539,267,304	$	5,394	$	3,600,197	$	(3,816,978	)	$	(211,367	)
Sale of common stock		–		–		–		–		4,000,000		40		14,360		–			14,400
Issuance of common stock for services		–		–		–		–		–		–		–		–			–
Conversion of Notes Payable		–		–		–		–		16,292,915		163		55,459		–			55,622
Net loss		–		–		–		–		–		–		–		(495,506	)		(495,506	)
Balance June 30, 2020		2,000,000	$	20		–	$	–		559,560,219	$	5,597	$	3,670,016	$	(4,312,484	)	$	(636,851	)
Sale of common stock		–		–		–		–		62,000,002		620		464,380		–			465,000
Issuance of common stock for services		–		–		–		–		11,733,333		117		74,816		–			74,933
Conversion of Notes Payable		–		–		–		–		25,663,705		256		434,579		–			434,835
Net loss		–		–		–		–		–		–		–		(1,269,353	)		(1,269,353	)
Balance September 30, 2020		2,000,000	$	20		–	$	–		658,957,259	$	6,590	$	4,643,791	$	(5,581,837	)	$	(931,436	)

See accompanying notes to the unaudited consolidated financial statements.

B2Digital, Incorporated

Consolidated Statements of Cash Flows (Unaudited)


	For the six months ended
	September 30,			September 30,
	2021			2020
Cash Flows from Operating Activities
Net Loss	$	(3,618,523	)	$	(1,764,859	)

Adjustments to reconcile net loss to net cash used by operating activities:
Stock compensation		23,650			89,333
Depreciation and amortization expense		186,519			66,855
Gain on forgiveness of loan		(23,303	)		0
Legal fees on convertible notes		7,000			0
Loss on settlement of debt		0			18,281
Loss on extinguishment of debt		0			64,194
Gain on extinguishment of debt		(136,666	)		0
Interest expense on extinguishment of debt		35,014			0
Loss of sale of assets		1,527			0
Gain on settlement of debt		0			(10,080	)
Grant income		0			(2,000	)
Amortization of debt discount		413,180			103,266
Changes in fair value of compound embedded derivative		354,942			787,407
Right- of- use asset/liability		52,830			0
Changes in operating assets & liabilities
Prepaid expenses		(70,113	)		(2,325	)
Inventory		0			5,811
Accounts receivable		(8,548	)		0
Accounts payable and accrued liabilities		178,152			42,581
Deferred revenue		(30,624	)		26,597
Net cash used by operating activities		(2,634,963	)		(574,939	)

Cash Flows from Investing Activities
Business acquisitions		(165,000	)		0
Payments to related parties		0			(470	)
Capital expenditures		(256,156	)		(128,031	)
Net cash used by investing activities		(421,156	)		(128,501	)

Cash Flows from Financing Activities
Proceeds from notes payable		150,000			122,766
Proceeds from convertible notes payable		2,096,681			150,000
Repayments related to payable due for business combinations		0			(15,000	)
Repayments of convertible notes payable		(207,863	)		0
Repayment of notes payable		(8,609	)		0
Payment to note payable		(2,354	)		(4,484	)
Issuance of common stock		1,180,000			465,000
Net cash provided by financing activities		3,207,855			718,282

Increase in Cash		151,736			14,842

Cash at beginning of period		122,176			46,729

Cash (and equivalents) at end of period	$	273,912		$	61,571

Supplemental Cash Flow Information
Cash paid for interest	$	8,303		$	599
Cash paid for income taxes	$	0		$	0

Non-cash investing and financing activities:
Conversion of note payable to equity	$	0		$	490,457

See accompanying notes to the unaudited consolidated financial statements.

~~F-4~~6

~~B2 Digital, Incorporated~~B2DIGITAL, INCORPORATED

~~Consolidated Statements of Cash Flows~~

For the six months ended
September 30, September 30,
2020 2019

Cash Flows from Operating Activities
Net Loss $ (1,764,859 ) $ (904,927 )

Adjustments to reconcile net loss to net cash used by operating activities:
Stock compensation 89,333 688,000
Depreciation and amortization expense 66,855 10,053
Loss on forgiveness of notes receivable – 27,000
Loss on settlement of debt 18,281 –
Loss on extinguishment of debt 64,194 50,756
Gain on settlement of debt (10,080 ) –
Grant income (2,000 ) –
Amortization of debt discount 103,266 –
Changes in fair value of compound embedded derivative 787,407 –
Changes in operating assets & liabilities
Prepaid expenses (2,325 ) (19,329 )
Inventory 5,811 –
Accounts payable and accrued liabilities 42,581 (36,495 )
Deferred revenue 26,597 –
Net cash used by operating activities (574,939 ) (184,942 )

Cash Flows from Investing Activities
Payments to related parties (470 ) (174,245 )
Capital expenditures (128,031 ) (31,985 )
Net cash used by investing activities (128,501 ) (206,230 )

Cash Flows from Financing Activities
Proceeds from notes payable 122,766 –
Proceeds from convertible notes payable 150,000 –
Repayments related to payable due for business combinations (15,000 ) –
Payment to note payable (4,484 ) –
Issuance of common stock 465,000 400,000
Net cash provided by financing activities 718,282 400,000

Increase in Cash 14,842 8,828

Cash at beginning of period 46,729 27,579

Cash (and equivalents) at end of period $ 61,571 $ 36,407

Supplemental Cash Flow Information
Cash paid for interest $ 599 $ –
Cash paid for income taxes $ – $ –

Non-cash investing and financing activities:
Conversion of note payable to equity $ 490,457 $ 59,400

~~See accompanying notes to the unaudited consolidated financial statements.~~

~~F-5~~

~~B2Digital, Incorporated~~

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, ~~2020~~2021

NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS

In February 2017, the Board of Directors of B2Digital, Incorporated ("B2Digital" or the "Company") approved a complete restructuring, new management team and strategic direction for the Company. Capitalizing on its history in television, video and technology, the Company is now forging ahead and becoming a full-service live event sports company.

B2Digital's first strategy is to build an integrated live event Minor League for the Mixed Martial Arts (MMA) marketplace. B2Digital will be creating and developing Minor League champions that will move on to the MMA Major Leagues from the B2 Fighting Series (B2FS). This will be accomplished by sponsoring operating live events, acquiring existing MMA promotions and then inviting those champions to the B2FS Regional and National Championship Series. B2Digital will own all media and merchandising rights and digital distribution networks for the B2FS.

2017 marked the kickoff of the B2FS by sponsoring and acquiring MMA regional promotion companies for the development of the B2FS. The second strategy is that the Company plans to add additional sports, leagues, tournaments and special events to its live event business model. This will enable B2Digital to capitalize on their core technologies and business models that will be key to broadening the revenue base of the Company's live event core business. B2Digital will also be developing and expanding the B2Digital live event systems and technologies. These include systems for event management, digital ticketing sales, digital video distribution, digital marketing, Pay-Per View (PPV), fighter management, merchandise sales, brand management and financial control systems.

Basis of Presentation and Consolidation

The Company has ~~seven~~eleven wholly-owned subsidiaries. Hardrock Promotions LLC which owns Hardrock MMA in Kentucky, Colosseum Combat LLC which owns Colosseum Combat MMA in Indiana, United Combat League MMA LLC, Pinnacle Combat LLC, Strike Hard Productions, LLC, ONE More Gym LLC, One More Gym Merrillville LLC, One More Gym Valparaiso LLC, One More Gym Tuscaloosa LLC, One More Gym Birmingham, Inc. and B2 Productions LLC.

The consolidated financial statements, which include the accounts of the Company and its ~~seven~~eleven wholly-owned subsidiaries, are prepared in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”). All significant intercompany balances and transactions have been eliminated. The consolidated financial statements, which include the accounts of the Company and its ~~seven~~eleven wholly-owned subsidiaries, and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The Financial Statements have been prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and presented in USU.S. dollars. The fiscal year end is March 31.

NOTE 2 - ACCOUNTING POLICIES

The significant accounting policies of the Company are as follows:

Basis of Accounting

The interim consolidated financial statements are condensed and should be read in conjunction with the Company’s latest annual financial statements; interim disclosures generally do not repeat those in the annual statements. The interim unaudited consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

~~F-6~~7

~~B2Digital, Incorporated~~B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, ~~2020~~2021

In the opinion of management, the unaudited interim consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. Interim results are not necessarily indicative of results for a full year.

Use of Estimates

Management uses estimates and assumptions in preparing financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. The most significant assumptions and estimates relate to the valuation of derivative liabilities and the valuation of assets and liabilities acquired through business combinations. Actual results could differ from these estimates and assumptions.

Cash and Cash Equivalents

The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. The Company maintains deposits primarily in four financial institutions, which may at times exceed amounts covered by insurance provided by the U.S. Federal Deposit Insurance Corporation ("FDIC"). The Company has not experienced any losses related to amounts in excess of FDIC limits or $250,000. The Company did ~~not~~0t have any cash in excess of FDIC limits at September 30, ~~2020~~2021 and ~~2019,~~2020, respectively.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of accounts payable and accrued liabilities. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments. The three levels of valuation hierarchy are defined as follows:

Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets.

Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The Company analyzes all financial instruments with features of both liabilities and equity under ASC 480, ~~Distinguishing~~“Distinguishing Liabilities from Equity,,” and ASC 815.

Property and Equipment

Property and equipment are carried at cost. Depreciation is provided on the straight-line method over the assets’ estimated service lives. Expenditures for maintenance and repairs are charged to expense in the period in which they are incurred, and betterments are capitalized. The cost of assets sold or abandoned and the related accumulated depreciation are eliminated from the accounts and any gains or losses are reflected in the accompanying consolidated statement of operations of the respective period. The estimated useful lives range from 3 to 7 ~~years.~~years.

Goodwill

Goodwill represents the cost in excess of the fair value of net assets acquired in business combinations. The Company tests goodwill for impairment on an annual basis and when events or changes in circumstances indicate that the carrying amount may not be recoverable. Goodwill is deemed to be impaired if the carrying amount of goodwill exceeds its estimated fair value. ~~As of~~During the three and six months ended September 30, ~~2020, there were no charges to goodwill impairment.~~2021, the Company did 0t record any impairment on goodwill.

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

~~Other income~~

Other income

During the six months ended September 30, 2021 and September 30, 2020, the Company received ~~$2,000~~$0 and $2,000, respectively in grant income due to COVID-19 relief. The Company has recorded this grant income under other income in the Statement of Operations.

~~F-7~~

~~B2Digital, Incorporated~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2020~~

Revenue Recognition

Revenue is recognized when a customer obtains control of promised goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. The majority of revenues are received from ticket and beverage sales before and during the live events. Sponsorship revenue is also recognized when the live event takes place. Any revenue received for events that have yet to take place are recorded in deferred revenue.

Income Taxes

The Company follows Section 740-10-30 of the FASB ASC, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the consolidated financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated Statements of Operations in the period that includes the enactment date. Through September 30, ~~2020,~~2021, the Company has an expected loss. Due to uncertainty of realization for these losses, a full valuation allowance is recorded. Accordingly, no provision has been made for federal income taxes in the accompanying consolidated financial statements.

~~F-8~~

~~B2Digital, Incorporated~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2020~~

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk are cash, accounts receivable and other receivables arising from its normal business activities. The Company places its cash in what it believes to be credit-worthy financial institutions. The Company controls credit risk related to accounts receivable through credit approvals, credit limits and monitoring procedures. The Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk, establishes an allowance, if required, for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowance is limited. In addition, Receivables that are factored through the Company's Receivable finance facility are guaranteed by the finance company that further mitigates Credit Risk.

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

Impairment of Long-Lived Assets

In accordance with ASC 360-10, the Company, on a regular basis, reviews the carrying amount of long-lived assets for the existence of facts or circumstances, both internally and externally, that suggest impairment. The Company determines if the carrying amount of a long-lived asset is impaired based on anticipated undiscounted cash flows, before interest, from the use of the asset. In the event of impairment, a loss is recognized based on the amount by which the carrying amount exceeds the fair value of the asset. Fair value is determined based on appraised value of the assets or the anticipated cash flows from the use of the asset, discounted at a rate commensurate with the risk involved. There were no impairment charges recorded during the six months ended September 30, ~~2020~~2021 and ~~2019.~~

~~Inventory~~

Inventories are valued at the lower of cost (determined on a weighted average basis) or market. Management compares the cost of inventories with the market value and allowance is made to write down inventories to market value, if lower. As of September 30, 2020, ~~and March 31, 2020, the Company had outstanding balances of finished goods inventory of $1,445 and $7,256,~~ respectively.

Earnings Per Share (EPS)

The Company utilize FASB ASC 260, Earnings per Share. Basic earnings (loss) per share is computed by dividing earnings (loss) available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include additional common shares available upon exercise of stock options and warrants using the treasury stock method, except for periods of operating loss for which no common share equivalents are included because their effect would be anti-dilutive. As of September 30, ~~2020,~~2021, the convertible notes are indexed to ~~183,301,670~~810,258,880 shares of common stock.

The following table sets ~~for~~forth the computation of basic and diluted earnings per share for the six months ended September 30, ~~2020~~2021 and ~~2019:~~2020:

September 30,
2020

September 30,
2019

Basic and diluted
Net loss $ (1,764,859 ) $ (904,927 )

Net loss per share
Basic $ (0.00 ) $ (0.00 )
Diluted $ (0.00 ) $ (0.00 )

Weighted average number of shares outstanding:
Basic & diluted 574,198,491 471,101,799

~~F-9~~

~~B2Digital, Incorporated~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2020~~

Schedule of Earnings Per Share, Basic and Diluted
	September 30, 2021			September 30, 2020
Basic and diluted
Net loss	$	(3,618,523	)	$	(1,764,859	)

Net loss per share
Basic	$	(0.00	)	$	(0.00	)
Diluted	$	(0.00	)	$	(0.00	)

Weighted average number of shares outstanding:
Basic & diluted		1,289,383,719			574,198,491

Stock Based Compensation

The Company records stock-based compensation in accordance with the provisions of FASB ASC Topic 718, Accounting for Stock Compensation, which establishes accounting standards for transactions in which an entity exchanges its equity instruments for goods or services. In accordance with guidance provided under ASC.

Topic 718, the Company recognizes an expense for the fair value of its stock awards at the time of grant and the fair value of its outstanding stock options as they vest, whether held by employees or others. As of September 30, ~~2020,~~2021, there were no0 options outstanding.

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

On June 20, 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018-07 is intended to reduce cost and complexity and to improve financial reporting for share-based payments to nonemployees (for example, service providers, external legal counsel, suppliers, etc.). Under the new standard, companies will no longer be required to value non-employee awards differently from employee awards. Meaning that companies will value all equity classified awards at their grant-date under ASC 718 and forgo revaluing the award after this date. The Company adopted ASU 2018-07 on April 1, 2019. The adoption of this standard did not have a material impact on the consolidated financial statements.

Recently Adopted Accounting Pronouncements

In January 2017, the FASB issued ASU No. 2017-04, Intangibles and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which eliminates the requirement to calculate the implied fair value of goodwill, but rather requires an entity to record an impairment charge based on the excess of a reporting unit’s carrying value over its fair value. This amendment is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurements (Topic 820): Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this update modify the disclosure requirements on fair value measurements in Topic 820. The ASU is effective for the Registrants for fiscal years beginning after December 15, 2019, and interim periods therein. Early adoption is permitted. The Company is currently assessing the impact of this standard on ~~their Financial Statements.~~our consolidated financial statements.

In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) – Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for the exception. The ASU also simplifies the diluted net income per share calculation in certain areas. The new guidance is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the impact of the adoption of the standard on the consolidated financial statements.

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the consolidated financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

~~F-10~~

~~B2Digital, Incorporated~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2020~~

NOTE 3 – GOING CONCERN

The accompanying consolidated financial statements have been prepared on a going concern basis. For the six months ended September 30, ~~2020,~~2021, the Company had a net loss of ~~$1,764,859,~~$3,618,523, had net cash used in operating activities of ~~$574,939,~~$2,634,963 had negative working capital of ~~$1,597,844,~~$5,589,042, accumulated deficit of ~~$5,581,837~~$12,815,771 and stockholders’ deficit of ~~$931,436.~~$3,946,129. These matters raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the date of this filing. The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due, to fund possible future acquisitions, and to generate profitable operations in the future. Management plans to provide for the Company’s capital requirements by continuing to issue additional equity and debt securities. The outcome of these matters cannot be predicted at this time and there are no assurances that, if achieved, the Company will have sufficient funds to execute its business plan or generate positive operating results. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

NOTE 4 – REVENUE

The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Live event revenue primarily includes ticket and beverage sales before and during the live events. Sponsorship revenue is also recognized when the live event takes place. Any revenue received for events that have yet to take place are recorded in deferred revenue. Gym revenue comprises primarily of membership dues and subscription. Other gym revenue includes personal training, group fitness and meal planning.

Information about the Company’s net sales by revenue type for the three and six months ended September 30, ~~2020~~2021 and ~~2019~~2020 are as follows:

Schedule of net sales by revenue type
	For the three months ended
	September 30,		September 30,
	2021 (Unaudited)		2020 (Unaudited)
Live events	$	283,171	$	30,318
Gym revenue		376,839		105,609
Net sales	$	660,010	$	135,927

	For the six months ended				For the six months ended
	September 30,		September 30,		September 30,		September 30,
	2020 (Unaudited)		2019 (Unaudited)		2021 (Unaudited)		2020 (Unaudited)
Live events	$	30,377	$	181,911	$	518,762	$	30,377
Gym revenue		165,571		–		710,013		165,571
Net sales	$	195,948	$	181,911	$	1,228,775	$	195,948

For the three months ended
September 30, September 30,

2020
(Unaudited)

2019
(Unaudited)

Live events $ 30,318 $ 96,275
Gym revenue 105,609 –
Net sales $ 135,927 $ 96,275

~~F-11~~12

~~B2Digital, Incorporated~~B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, ~~2020~~2021

NOTE 5 – PROPERTY AND EQUIPMENT

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

Schedule of property and equipment
	As of			As of			As of			As of
	September 30, 2020			March 31, 2020			September 30, 2021			March 31, 2021

Gym equipment	$	170,500		$	163,147		$	507,906		$	420,880
Cages		124,025			124,025			151,009			132,350
Event assets		93,121			61,319			116,088			92,117
Furniture and fixtures		2,500			0			16,766			16,766
Production truck gear								11,740			11,740
Production equipment		30,697			30,697			58,704			32,875
Venue lighting system								38,266			37,250
Leasehold improvements								167,229			43,712
Electronics hardware and software		31,254			11,845			149,234			124,624
Trucks trailers and vehicles		65,592			11,210			225,278			197,921
		517,689			402,243			1,442,220			1,110,235
Less: accumulated depreciation		(89,521	)		(50,850	)		(298,043	)		(165,236	)
	$	428,168		$	351,393		$	1,144,177		$	944,999

Depreciation expense related to these assets for the six months ended September 30, ~~2020~~2021 and ~~2019~~2020 amounted to ~~$38,672~~$134,140 and ~~$10,053,~~$38,672, respectively.

NOTE 6 – INTANGIBLE ASSETS

Intangible assets, net, consisted of the ~~following at September 30, 2020:~~following:

Schedule of intangible assets
	As of			As of			As of			As of
	September 30, 2020			March 31, 2020			September 30, 2021			March 31, 2021

Licenses	$	142,248		$	142,248		$	142,248		$	142,248
Software/website development		12,585			–			12,585			12,585
Customer relationships		83,000			83,000			216,343			170,031
		237,833			225,248			371,176			324,864
Less: accumulated amortization		(56,480	)		(28,297	)		(152,353	)		(99,974	)
	$	181,353		$	196,951		$	218,823		$	224,890

Licenses are amortized over5 five years, whereas customer relationships and software/website development are amortized over three3 years. Amortization expense related to these assets for the six months ended September 30, ~~2020~~2021 and ~~2019~~2020 amounted to ~~$28,183~~$52,379 and ~~$0,~~$28,183, respectively.

~~F-12~~13

~~B2Digital, Incorporated~~B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, ~~2020~~2021

~~Estimated amortization expense for each of the next five years:~~

Fiscal year ended March 31, 2021	$	30,156
Schedule of amortization expense
Estimated amortization expense for each of the next four years:			Estimated amortization expense for each of the next four years:

Fiscal year ended March 31, 2022		60,311		$	52,379
Fiscal year ended March 31, 2023		53,395			97,873
Fiscal year ended March 31, 2024		30,422			61,532
Fiscal year ended March 31, 2025		7,069			7,069
Total	$	181,353		$	218,823

NOTE 7 – BUSINESS ACQUISITIONS

~~United Combat League, UCL MMA~~Club Fitness, LLC

~~Effective May~~On April 1, ~~2019,~~2021, the Company ~~completed its previously announced~~entered into an agreement for the acquisition of 100% of the equity interest in ~~United Combat League, LLC (“UCL”), in an effort to execute its strategy of developing and building a Premier Development League for the Mixed Martial Arts (“MMA”) marketplace.~~Club Fitness LLC. The purchase price was ~~$20,000~~ $125,000 in ~~cash and 6,000,000 shares of Restricted Common Stock issuable to Michael Davis, the seller of the equity interest~~cash. The acquisition closed in the acquisition. The Company is required to pay the cash consideration in three payments as follows: (i) $10,000 on or before 10 calendar days after the execution date of the agreement, (ii) $5,000 on or before 45 calendar days after the execution date of the agreement, and (iii) $5,000 on or before 90 calendar days after the execution date of the agreement. As of September 30, 2020, the $10,000 cash consideration has been paid in full.April 2021.

Schedule of business combination purchase allocation
Consideration
Cash	$	125,000

Fair values of identifiable net assets:
Property & equipment:
Gym equipment	$	76,689

Intangible assets:
Customer relationships		46,311

Total fair value of identifiable net assets	$	125,000

The Company analyzed the acquisition under applicable guidance and determined that the acquisition should be accounted for as a business combination. The ~~value of the consideration was $59,000 of which $20,000 was in cash and $39,000 as the~~ fair value of the ~~6,000,000 shares~~net identifiable assets consisted of ~~common stock.~~gym equipment of $76,689. The Company assigned a fair value of ~~$59,000 to the intangible assets – licenses. The intangible assets - licenses are being amortized over their estimated life, currently expected to be five years.~~

~~Pinnacle Combat LLC- Acquisition~~

On July 15, 2019, to be effective June 29, 2019, the Company completed an acquisition of 100% of the equity interest in Pinnacle Combat LLC of Iowa (“Pinnacle”), in an effort to execute its strategy of developing and building a Premier Development League for the MMA marketplace. The purchase price was $20,000 in cash and 8,000,000 shares of Restricted Common Stock, 5,000,000 to be issued to Harry Maglaris and 3,000,000 to be issued to Ken Rigdon, collectively the sellers of the equity interest in the acquisition. The Company is required to pay the cash consideration in three payments as follows: (i) $10,000 on or before 10 calendar days after the execution date of the agreement, (ii) $5,000 on or before 45 calendar days after the execution date of the agreement, and (iii) $5,000 on or before 90 calendar days after the execution date of the agreement. As of September 30, 2020, the $10,000 cash consideration has been paid in full.

The Company analyzed the acquisition under applicable guidance and determined that the acquisition should be accounted for as a business combination. The value of the consideration was $82,400 of which $20,000 was in cash and $62,400 as the fair value of the 8,000,000 shares of common stock. The fair value of the next identifiable assets which consisted of property and equipment amounted to $73,380. The fair value of the liability assumed which consisted of a credit card liability amounted to $25,028. The Company assigned a fair value of $34,048 in intangible assets – licenses. The intangible assets - licenses are being amortized over their estimated life, currently expected to be five years.

~~F-13~~

~~B2Digital, Incorporated~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2020~~

~~Strike Hard Productions LLC- Acquisition~~

On September 1, 2019, the Company completed an acquisition of 100% of the equity interest in Strike Hard Productions LLC, a fighting promotion business, in an effort to execute its strategy of developing and building a Premier Development League for the MMA marketplace. The purchase price was $20,000 in cash and 9,000,000 shares of Restricted Common Stock, 3,000,000 Restricted Shares issued to be issued to David Elder, 3,000,000 Restricted Common Shares to be issued to James Sullivan and 3,000,000 Restricted Common Shares to be issued to Matt Leavell, collectively the sellers of the equity interest in the acquisition. The Company is required to pay the cash consideration in three payments as follows: (i) $10,000 on or before 10 calendar days after the execution date of the agreement, (ii) $5,000 on or before 45 calendar days after the execution date of the agreement, and (iii) $5,000 on or before 90 calendar days after the execution date of the agreement. As of September 30, 2020, the $10,000 cash consideration has been paid in full.

The Company analyzed the acquisition under applicable guidance and determined that the acquisition should be accounted for as a business combination. The value of the consideration was $82,400 of which $20,000 was in cash and $62,400 as the fair value of the 9,000,000 shares of common stock. The fair value of the next identifiable assets which consisted of property and equipment amounted to $23,000. The Company assigned a fair value of $49,200 in intangible assets – licenses. The intangible assets - licenses are being amortized over their estimated life, currently expected to be five years.

~~One More Gym LLC~~

On January 6, 2020, the Company completed an acquisition of 100% of the equity interest in One More Gym LLC (“1MG”), a gym. The purchase price was $30,000 in cash and 6,000,000 shares of Restricted Common Stock (valued at $31,800 or $0.0053 per share), 6,000,000 shares to be issued to BHC Management LLC, the seller of the equity interest in the acquisition. As of September 30, 2020, the Company owes $10,000 in cash consideration to BHC Management.

The Company analyzed the acquisition under applicable guidance and determined that the acquisition should be accounted for as a business combination. The value of the consideration was $61,800 of which $20,000 was in cash and $31,800 as the fair value of the 6,000,000 shares of common stock. The fair value of the next identifiable assets which consisted of cash of $2,392 and property and equipment of $159,703, amounted to $162,095. The Company assigned a fair value of $83,000$46,311 in intangible assets – customer relationships. The intangible assets – customer relationships are being amortized over their estimated life, currently expected to be three years. ~~The Company recorded a gain on bargain purchase of $52,583.~~

~~F-14~~14

~~B2Digital, Incorporated~~B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, ~~2020~~2021

NOTE 8 - NOTES PAYABLE

The following is a summary of notes payable as of September 30, ~~2020~~2021 and March 31, ~~2020:~~2021:

Schedule of notes payable
	As of			As of			As of			As of
	September 30,			March 31,			September 30,			March 31,
	2020			2020			2021			2021
Notes payable - current maturity:
Emry Capital $14,000, 4% loan with principal and interest due April, 2020	$	–		$	14,000
Note Payable PPP SBA Loan		15,600			–		$	0		$	15,600
SBA EIDL Loan		10,000			–			10,000			10,000
SBA Loan Payable B2 Digital		97,200			–
SBA Loan Payable B2Digital								97,200			97,200
Notes payable – in default:
Emry Capital $14,000, 4% loan with principal and interest due April, 2020		14,000			–
Emry Capital $14,000, 4% loan with principal and interest due April, 2020								14,000			14,000
Notes payable – long term:
WLES LP LLC $60,000, 5% loan due January 15, 2022		30,000			60,000
WLES LP LLC $60,000, 5% loan due January 15, 2022								30,000			30,000
Brian Cox 401K		17,486			21,970			8,157			12,882
SBA Loan (Hillcrest)								35,400			35,400
SBA Loan (One More Gym, LLC)		67,841			74,757			52,528			63,047
GS Capital, LLC								153,000			0
Total notes payable		252,127			170,727			400,285			278,129
Less: long-term		(115,327	)		(34,162	)		(90,685	)		(105,929	)
Total	$	136,800		$	136,565		$	309,600		$	172,200

~~On May 8, 2020, WLES LP LLC converted $30,000 of its $60,000 notes payable into 12,000,000 shares of common stock. As a result,~~During the six months ended September 30, 2021, the Company ~~recorded a loss on settlement of debt~~incurred $9,902 in ~~the amount of $18,281.~~interest expense related to notes payable.

During the six months ended September 30, ~~2020,~~2021, the Company repaid ~~$4,484~~$4,724 on its loan payable to Brian Cox.

During the six months ended September 30, ~~2020,~~2021, the bank forgave ~~$6,949~~$6,634 in principal and ~~$3,132~~$1,069 in accrued interest on its SBA Loan (One More Gym, LLC). As a result, the Company recorded ~~$10,080~~$7,703 in gain on forgiveness of loan.

During the six months ended September 30, 2021 the bank forgave the Company’s PPP loan of $15,600. No interest was accrued as of the payoff date. As a result, the Company recorded $15,600 in gain on forgiveness of loan.

~~F-15~~15

~~B2Digital, Incorporated~~

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, ~~2020~~2021

NOTE 9 – CONVERTIBLE NOTE PAYABLE

The following is a summary of convertible notes payable as of September 30, ~~2020:~~2021:

Schedule of convertible notes payable
Note*	Inception Date	Maturity	Coupon		Face Value		Unamortized Discount		Carrying Value
Note 5	1/27/2020	1/27/2021		8%	$	202,400	$	0	$	202,400
Note 6	2/19/2020	2/19/2021		8%		85,800		0		85,800
Note 7	3/10/2020	3/10/2021		8%		85,800		0		85,800
Note 8	8/4/2020	8/4/2021		8%		156,000		0		156,000
Note 9	10/2/2020	10/2/2021		8%		205,000		0		205,000
Note 10	10/15/2020	10/15/2021		8%		172,000		7,463		164,537
Note 11	11/2/2020	11/2/2021		8%		69,000		3,542		65,458
Note 12	11/12/2020	11/12/2021		8%		69,000		2,181		66,819
Note 14	12/10/2020	12/10/2021		8%		80,000		7,067		72,933
Note 16	1/14/2021	1/14/2022		8%		107,000		13,863		93,137
Note 17	1/27/2021	1/27/2021		8%		60,000		9,724		50,276
Note 20	4/30/2021	4/30/2022		8%		104,000		2,352		101,648
Note 21	5/25/2021	5/25/2022		8%		104,000		4,094		99,906
Note 22	06/24/2021	06/24/2022		8%		185,652		45,081		140,571
Note 23	07/01/2021	07/01/2022		8%		180,400		30,317		150,083
Note 24	07/24/2021	07/24/2022		8%		265,000		60,970		204,030
Note 25	08/04/2021	08/04/2022		8%		129,800		31,372		98,428
Note 26	08/11/2021	08/11/2022		8%		151,500		35,572		115,928
Note 27	08/16/2021	08/16/2022		8%		88,400		24,411		63,989
Note 28	08/20/2021	08/20/2022		8%		151,500		40,075		111,425
Note 29	08/30/2021	08/30/2022		8%		140,650		34,054		106,596
Note 30	09/02/2021	09/02/2022		8%		216,385		58,052		158,333
Note 31	09/17/2021	09/17/2022		8%		270,480		63,833		206,647
Note 32	09/30/2021	09/30/2022		8%		270,480		63,805		206,675

Total					$	3,550,247	$	537,828	$	3,012,419

Note* Inception Date Maturity Coupon Face Value Unamortized Discount Carrying Value
Note 2 10/31/2019 12/15/2020 8% $ 208,000 $ 19,945 $ 188,055
Note 3 12/5/2019 12/5/2020 8% 62,000 4,685 57,315
Note 4 12/31/2019 12/31/2020 8% 62,000 3,225 58,775
Note 5 1/27/2020 1/27/2021 8% 184,000 11,101 172,899
Note 6 2/19/2020 2/19/2021 8% 78,000 7,640 70,360
Note 7 3/10/2020 3/10/2021 8% 78,000 9,374 68,626
Note 8 8/4/2020 8/4/2021 8% 156,000 45,077 110,923
$ 828,000 $ 101,047 $ 726,953

* ~~Note~~Notes 1, 2, 3 and 4 in the ~~amount~~amounts of $82,000, ~~was~~$208,000, $27,000 and $62,000, respectively, were fully converted as of ~~September 30, 2020.~~March 31, 2021.

Between ~~October 4, 2019~~April 1, 2021 and ~~August 4, 2020,~~September 30, 2021, the Company issued to ~~GS Capital Partners, LLC, an accredited investor (“GS Capital”),~~“accredited investors,” Convertible Promissory Notes aggregating a principal amount of ~~$910,000.~~$2,258,247. The Company received an aggregate net proceeds of ~~$875,500~~$2,096,681 after ~~$34,500~~$154,566 in original note ~~discount.~~discount and $7,000 in legal fees. The Company has agreed to pay interest on the unpaid principal balance at the rate of eight percent (8%) per annum from the ~~date~~dates on which Notes are issued until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company shall have the right to prepay the Notes, provided it makes a payment ~~to GS Capital~~ as set forth in the agreements.

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

The outstanding principal amount of the Notes is convertible into the Company’s common stock at the lender’s option at $0.01 per share for the first six months of the term of the Notes. After the six-month anniversary, the conversion price is equal to 63% of the average of the three lowest trading prices of the Company’s common stock.

Accounting Considerations

The Company has accounted for the Notes as a financing transaction, wherein the net proceeds that were received were allocated to the financial instrument issued. Prior to making the accounting allocation, the Company evaluated the agreement under ASC 815 Derivatives and Hedging (“ASC 815”). ASC 815 generally requires the analysis embedded terms and features that have characteristics of derivatives to be evaluated for bifurcation and separate accounting in instances where their economic risks and characteristics are not clearly and closely related to the risks of the host contract. The material embedded derivative features consisted of the embedded conversion option and default puts. The conversion option and default puts bear risks of equity which were not clearly and closely related to the host debt agreement and required bifurcation. The contracts do not permit the Company to settle in registered shares and the contracts also contain make-whole provisions both of which preclude equity classification. Current accounting principles that are also provided in ASC 815 do not permit an issuer to account separately for individual derivative terms and features that require bifurcation and liability classification. Rather, such terms and features must be and were bundled together and fair valued as a single, compound embedded derivative.

~~F-16~~

~~B2Digital, Incorporated~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2020~~

~~Based on the previous conclusions, the Company allocated the cash proceeds first to the derivative components at its fair value with the residual allocated to the host debt contract, as follows:~~

Note 1 Note 2 Note 3 Note 4 Note 5 Note 6 Note 7 Note 8 Total
Compound embedded derivative $ 26,395 $ 68,030 $ 15,893 $ 10,812 $ 25,834 $ 14,095 $ 17,636 $ 42,463 $ 221,156
Convertible notes payable 48,605 133,970 44,107 49,188 152,666 60,905 57,364 107,537 654,344
Original issue discount 7,000 6,000 2,000 2,000 5,500 3,000 3,000 6,000 34,500
Face value $ 82,000 $ 208,000 $ 62,000 $ 62,000 $ 184,000 $ 78,000 $ 78,000 $ 156,000 $ 910,000

The net proceeds were allocated to the compound embedded derivative and original issue discount. The notes will be amortized up to its face value over the life of Notes based on an effective interest rate. Amortization expense and interest expense for the six months ended September 30, ~~2020~~2021 is as follows:

Schedule of amortization expense, interest expense and accrued interest on debt
Note	Interest Expense		Accrued Interest		Amortization of Debt Discount		Unamortized
Note 5	$	9,183	$	39,315	$	0	$	0
Note 6		3,892		15,693		0		0
Note 7		3,893		14,872		0		0
Note 8		1,949		14,429		9,379		0
Note 9		4,224		16,400		37,415		0
Note 10		3,468		13,195		20,501		7,463
Note 11		1,391		5,021		9,572		3,542
Note 12		1,391		4,870		6,137		2,181
Note 14		1,613		5,155		9,447		7,067
Note 16		2,158		6,074		9,205		13,863
Note 17		1,210		3,235		6,244		9,724
Note 18		912		2,370		9,192		24,247
Note 19		1,391		3,478		13,932		33,469
Note 20		2,097		3,488		992		2,352
Note 21		2,097		2,918		1,493		4,094
Note 22		3,744		3,988		12,448		45,081
Note 23		3,598		3,598		8,928		30,317
Note 24		3,775		3,775		10,395		60,970
Note 25		1,622		1,622		5,337		31,372
Note 26		1,660		1,660		6,042		35,572
Note 27		872		872		4,012		24,411
Note 28		1,361		1,361		6,641		40,075
Note 29		956		956		2,653		34,054
Note 30		1,328		1,328		4,433		58,052
Note 31		1,660		1,660		4,996		63,833
Note 32		0		0		0		63,805
Total	$	61,445	$	171,333	$	199,394	$	595,544

Note Interest
Expense Accrued Interest
Balance Amortization of Debt Discount Unamortized
Discount
Note 1 $ 1,015 $ – $ 18,870 $ 0
Note 2 8,343 13,958 33,352 19,945
Note 3 2,487 4,077 8,335 4,685
Note 4 2,487 3,723 5,955 3,225
Note 5 7,380 9,961 15,408 11,101
Note 6 3,129 3,829 8,186 7,640
Note 7 3,129 3,488 9,774 9,374
Note 8 6,975 6,975 3,386 45,077
$ 34,945 $ 46,011 $ 103,266 $ 101,047

~~On April 23, 2020, GS Capital converted $7,000~~

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

As of September 30, 2021, Note 5, Note 6, and Note 7 are considered in default. Upon an event of default, the interest accrues at 18%. Additionally, upon non-payment at maturity, the principal increases by 10%. The principal on Note 5 increased by $18,400, Note 6 increased by $7,800and $341 in accrued interest of the October 4, 2019 $84,000 face value note into 4,292,915 shares of common stock. On July 31, 2020, GS Capital converted $7,500 in principal and $488 in accrued interest of the October 4, 2019 $84,000 face value note into 5,071,885 shares of common stock. On August 20, 2020, GS Capital converted $12,500 in principal and $871 in accrued interest of the October 4, 2019 $84,000 face value note into 8,468,394 shares of common stock. On September 9, 2020, GS Capital converted $55,000 in principal and $4,075 in accrued interest of the October 4, 2019 $84,000 face value note into 12,123,426 shares of common stock. As a result of the August and September conversions, the Company recorded $64,194 as loss on extinguishment of debt.Note 7 increased by $7,800.

NOTE 10 ~~–DERIVATIVE~~–DERIVATIVE FINANCIAL INSTRUMENTS

The following tables summarize the components of the Company’s derivative liabilities and linked common shares as of September 30, 2021:

Schedule of derivative liabilities
	September 30, 2021
The financings giving rise to derivative financial instruments	Indexed Shares		Fair Values
Compound embedded derivatives		810,258,880	$	(1,762,774	)
Total		810,258,880	$	(1,762,774	)

The following tables summarize the components of the Company’s derivative liabilities and linked common shares as of September 30, 2020:

	September 30, 2020					September 30, 2020
The financings giving rise to derivative financial instruments	Indexed Shares		Fair Values			Indexed Shares		Fair Values
Compound embedded derivatives		183,301,670	$	(599,454	)		183,301,607	$	(599,454	)
Total		183,301,670	$	(599,454	)		183,301,607	$	(599,454	)

The following table summarizes the effects on the Company’s gain (loss) associated with changes in the fair values of the derivative financial instruments by type of financing for the three months ended September 30, 2021 and 2020:

~~F-17~~

~~B2Digital, Incorporated~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2020~~

The financings giving rise to derivative financial instruments and the income effects:	September 30, 2021			September 30, 2020
Compound embedded derivatives	$	(354,942	)	$	(511,975	)
Total (loss)	$	(354,942	)	$	(511,975	)

The financings giving rise to derivative financial instruments and the income effects:				September 30, 2021			September 30, 2020
Compound embedded derivatives	$	(787,407	)	$	(665,813	)	$	(787,407	)
Total gain (loss)	$	(787,407	)
Total (loss)				$	(665,813	)	$	(787,407	)

The financings giving rise to derivative financial instruments and the income effects:
Compound embedded derivatives $ (511,975 )
Total gain (loss) $ (511,975 )

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

The Company’s Convertible Promissory Notes issued onbetween October 4, 2019 ~~October 31, 2019, December 5, 2019, December 31, 2019, January 27, 2020, February 19, 2020, March 10, 2020~~ and ~~August 4, 2020, respectively,~~September 30, 2021 gave rise to derivative financial instruments. The notes embodied certain terms and conditions that were not clearly and closely related to the host debt agreement in terms of economic risks and characteristics. These terms and features consist of the embedded conversion option.

Current accounting principles that are provided in ASC 815 - Derivatives and Hedging require derivative financial instruments to be classified in liabilities and carried at fair value with changes recorded in income. In addition, the standards do not permit an issuer to account separately for individual derivative terms and features embedded in hybrid financial instruments that require bifurcation and liability classification as derivative financial instruments. Rather, such terms and features must be bundled together and fair valued as a single, compound embedded derivative. The Company has selected the Monte Carlo Simulations valuation technique to fair value the compound embedded derivative because it believes that this technique is reflective of all significant assumption types, and ranges of assumption inputs, that market participants would likely consider in transactions involving compound embedded derivatives. Such assumptions include, among other inputs, interest risk assumptions, credit risk assumptions and redemption behaviors in addition to traditional inputs for option models such as market trading volatility and risk-free rates. The Monte Carlo Simulations technique is a level three valuation technique because it requires the development of significant internal assumptions in addition to observable market indicators.

Significant inputs and results arising from the Monte Carlo Simulations process are as follows for the embedded derivatives that have been bifurcated from the Convertible Notes and classified in liabilities:

Significant inputs	~~Inception~~
	September 30, 2021
Quoted market price on valuation date	$~~0.0031 - $0.0058~~0.01
Contractual conversion rate	$0.00265-$0.01
Contractual term to maturity	~~1.00~~0.005 Years – ~~1.13~~1.0 Years
Market volatility:
Equivalent Volatility	~~15.89%~~93.44% - ~~319.40%~~184.40%
Interest rate	~~8.0%~~8.00%

The following table reflects the issuances of compound embedded derivatives and the changes in fair value inputs and assumptions related to the compound embedded derivatives during the period ended September 30, ~~2020.~~2021 and March 31, 2021.

Schedule of changes in fair value of derivatives
	September 30,			March 31,
	2021			2021

Beginning balance	$	1,137,623		$	58,790
Issuances:
Compound embedded derivatives		407,194			732,416
Conversions		0			(859,352	)
Derivative extinguished / debt repaid in cash		(136,666	)		(126,892	)
(Gain) loss on changes in fair value inputs and assumptions reflected in income		354,942			1,332,661
Total	$	1,763,093		$	1,137,623

September 30, 2020
Balance at April 1, 2020 $ 58,790
Issuances:
Compound embedded derivatives 42,463
Conversions (289,206 )
Loss on changes in fair value inputs and assumptions reflected in income 787,407
Balance at September 30, 2020 $ 599,454

~~F-18~~19

~~B2Digital, Incorporated~~B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, ~~2020~~2021

NOTE 11 - EQUITY

Preferred Stock

There are 50,000,000 shares authorized as preferred stock, of which 40,000,000 are designated as Series B and 2,000,000 are designated as Series A. 8,000,000 shares have yet to be designated. All 2,000,000 shares of Series A preferred are issued and outstanding. Each share of Series A preferred is convertible into 240 shares of common stock. The Series A Preferred Stock votes with the Common Stock on all matters to be voted on by the common stock on an as-converted basis. On such matters, each holder of Series A Preferred Stock is entitled to 240 votes for each share of Series A Preferred Stock held by such shareholder.

Common Stock

~~Common Stock Issuances for the six months ended September 30, 2019~~

~~On April 23, 2019, the Company issued 4,000,000 shares of common stock in exchange for services valued at $25,600 or $0.0064 per share.~~

~~On May 14, 2019, the Company sold 1,562,500 shares of common stock for $10,000 or $0.0064 per share.~~

~~On May 25, 2019, the Company sold 11,718,750 shares of common stock for $75,000 or $0.0064 per share.~~

~~On June 1, 2019, the Company issued 67,000,000 shares of common stock in exchange for services valued at $428,800 or $0.0064 per share.~~

~~On June 1, 2019, the Company issued 6,000,000 shares of common stock in exchange for the acquisition of UCL MMA LLC valued at $39,000 or $0.0065 per share.~~

~~On July 3, 2019 the Company issued 6,000,000 shares of common stock in exchange for services valued at $38,400 or $0.0064 per share.~~

~~On July 8, 2019, the Company entered into a Subscription Agreement with a holder for the sale of 14,062,500 shares of common stock at $0.0064 per share, or $90,000.~~

~~On July 15, 2019 the Company issued 30,500,000 shares of common stock in exchange for services valued at $195,200 or $0.0064 per share.~~

~~On July 15, 2019 the Company issued 8,000,000 shares of common stock in exchange for the acquisition of Pinnacle Combat LLC valued at $51,200 or $0.0064 per share.~~

~~On August 30, 2019 the Company sold 15,625,000 shares of common stock for $100,000 or $0.0064 per share.~~

~~On September 7, 2019 the Company sold 7,812,500 shares of common stock for $50,000 or $0.0064 per share.~~

~~On September 19, 2019 the Company sold 11,718,750 shares of common stock for $75,000 or $0.0064 per share.~~

~~On September 27, 2019, the Company canceled 7,500,000 in exchange for the cancellation of $75,000 in Notes Receivable.~~

~~As part of the Strike Hard Productions LLC acquisition, the Company issued 9,000,000 shares of common stock valued at $57,600 or $0.0064 per share.~~

~~F-19~~

~~B2Digital, Incorporated~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2020~~

Common Stock Issuances for the six months ended September 30, 2020

On April 23, 2020, the Company issued 4,292,915 shares of stock to GS Capital in exchange for the conversion of ~~$7,341~~$7,341 in convertible note principal.

On May 8, 2020, the Company issued 12,000,000 shares of stock to WLES LP LLC in exchange for the conversion of ~~$30,000~~$30,000 in convertible note principal. The 12,000,000 shares were valued at ~~$48,281~~$48,281 resulting in a loss on settlement of debt in the amount of ~~$18,281.~~$18,281.

On June 16, 2020, the Company issued 4,000,000 shares of common stock to Veyo Partners LLC in exchange for investor relation services valued at ~~$14,400~~$14,400 or ~~$0.0036~~$0.0036 per share.

On July 10, 2020, the Company issued 4,000,000 shares of common stock to Veyo Partners LLC in exchange for investor relation services valued at ~~$14,000~~$14,000 or $0.0035 per share.

On July 31, 2020, GS Capital converted ~~$7,500~~$7,500 in principal and ~~$488~~$488 in accrued interest of the October 4, 2019 ~~$84,000~~$84,000 face value note into 5,071,885 shares of common stock. The 5,071,885 shares were valued at ~~$16,558.~~$16,558. The Company recorded the removal of the ~~$7,500~~$7,500 in ~~principal, $488~~principle, $488 in interest, and ~~$8,570~~$8,570 in derivative liabilities resulting in no gain or loss.

On August 10, 2020, the Company issued 4,000,000 shares of common stock to Veyo Partners LLC in exchange for investor relation services valued at ~~$34,800~~$34,800 or $0.0087 per share.

On August 13, 2020, the Company sold 13,333,334 shares of common stock for ~~$100,000~~$100,000 or $0.0075 per share.

On August 19, 2020, the Company sold 13,333,334 shares of common stock for ~~$100,000~~$100,000 or $0.0075 per share.

On August 20, 2020, GS Capital converted ~~$12,500~~$12,500 in principal and ~~$871~~$871 in accrued interest of the October 4, 2019 ~~$84,000~~$84,000 face value note into 8,468,394 shares of common stock. The 8,468,394 shares were valued at ~~$155,914.~~$155,914. After recording the removal of the ~~$12,500~~$12,500 in principal, ~~$871~~$871 in interest, and ~~$138,647~~$138,647 in derivative liabilities, the Company recorded ~~$3,896~~$3,896 as loss on extinguishment of debt.

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

On September 1, 2020, the Company sold 13,333,334 shares of common stock for ~~$100,000~~$100,000 or $0.0075 per share.

On September 9, 2020, GS Capital converted ~~$55,000~~$55,000 in principal and ~~$4,075~~$4,075 in accrued interest of the October 4, 2019 ~~$84,000~~$84,000 face value note into 12,123,426 shares of common stock. The 12,123,426 shares were valued at ~~$262,363.~~$262,363. After recording the removal of the ~~$55,000~~$55,000 in principal, ~~$4,075~~$4,075 in interest, and ~~$142,990~~$142,990 in derivative liabilities, the Company recorded ~~$60,298~~$60,298 as loss on extinguishment of debt.

On September 14, 2020, the Company sold 22,000,000 shares of common stock for ~~$165,000~~$165,000 or $0.0075 per share.

On September 30, 2020, the Company issued 3,733,333 shares of common stock for services valued at ~~$26,133~~$26,133 or $0.0070 per share.

Common Stock Issuances for the six months ended September 30, 2021

On April 1, 2021, the Company issued 50,000,000 shares of stock to GS Capital in exchange for $200,000 or $0.004 per share.

On April 10, 2021, the Company issued 25,000,000 shares of stock to AES Capital in exchange for $100,000 or $0.004 per share.

On April 14, 2021, the Company issued 13,750,000 shares of stock to GS Capital in exchange for $55,000 or $0.004 per share.

On May 13, 2021, the Company issued 50,000,000 shares of stock to GS Capital in exchange for $200,000 or $0.004 per share.

On May 21, 2021 the Company issued 1,500,000 shares of common stock to Rex Chan in exchange for contractor services valued at $6,450 or $0.0043 per share representing the share price at the date of the transaction.

On May 21, 2021 the Company issued 2,000,000 shares of common stock to BM Giancarlo in exchange for management services valued at $8,600 or $0.0043 per share representing the share price at the date of the transaction.

On May 21, 2021 the Company issued 2,000,000 shares of common stock to Carlos Diaz in exchange for management services valued at $8,600 or $0.0043 per share representing the share price at the date of the transaction.

On June 3, 2021, the Company issued 25,000,000 shares of stock to AES Capital in exchange for $100,000 or $0.004 per share.

On June 16, 2021, the Company issued 31,250,000 shares of stock to GS Capital in exchange for $125,000 or $0.004 per share.

On June 25, 2021, the Company issued 25,000,000 shares of stock to AES Capital in exchange for $100,000 or $0.004 per share.

On July 13, 2021, the Company issued 25,000,000 shares of stock to Geneva Roth in exchange for $100,000 or $0.004 per share.

On July 15, 2021, the Company issued 25,000,000 shares of stock to GS Capital in exchange for $100,000 or $0.004 per share.

On July 21, 2021, the Company issued 25,000,000 shares of stock to GS Capital in exchange for $100,000 or $0.004 per share.

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

NOTE 12 ~~–LEASES~~–LEASES

Kokomo lease

On October 1, 2020, the Company, under its subsidiary ONE More Gym LLC, entered into a facilities lease (“Kokomo Lease”) for 25,000 square feet in Kokomo, Indiana. The initial lease term is for five years and the lease commencement date is October 1, 2020. The monthly lease payments are $7,291.66 in year 1, $7,656.25 in year 2, $8,039.06 in year 3, and $8,441.02 in years 4 and 5.

Valparaiso Lease7,624

The Company leases 11,676 square feet of office space located at 1805 E. Lincolnway, Valparaiso, Indiana 46383. The Company assumed the lease (“Valparaiso Lease”) when it acquired CFit Indiana Inc. on October 6, 2020. The monthly lease payments are $7,624.50 and the lease expires on December 31, 2023.

Merrill Lease

In connection with the acquisition of ~~the One More Gym, LLC,~~CFit Indiana Inc. on October 6, 2020, the Company ~~assumed~~acquired a ~~building~~facilities lease for 15,000 square feet at 6055N. Broadway Ave., Merrillville, Indiana. The monthly lease payments are $11,189.50 and ~~two equipment leases.~~the lease expires on February 28, 2026.

Tuscaloosa Lease

In connection with the acquisition of Hillcrest Fitness LLC on December 1, 2020, the Company acquired a facilities lease at 6551 Highway 69 South, Tuscaloosa, AL 35405. The monthly lease ~~terms~~payments are ~~under 12 months. Under Topic 842,~~$6,000 and the lease expires on March 6, 2024.

Birmingham Lease

In connection with the acquisition of Club Fitness LLC on April 1, 2021, the Company acquired a ~~short-term~~facilities lease at 2520 Moody Parkway, Mood, AL 35004. The monthly lease payments are $6,000 and the lease expires on April 30, 2026.

Valparaiso Additional Space Lease

On August 30, 2021, the Company entered into a facilities lease (“Valparaiso Additional Space”) for 6,380 square feet in Valparaiso, Indiana. The initial lease term is for five years and the lease commencement date is August 30, 2021. The monthly lease payments are $4,250.00 plus Common Area Maintenance (“CAM”) in year 1, $5,316.66 plus (“CAM”) in year 2 and 3, and $6,380.00 plus (“CAM”) in year 4 and 5. The Company has the option to renew at a rental rate of $6,911.66 plus (“CAM”) for years 2029 through 2033.

Operating lease ~~that,~~right-of-use asset and liability are recognized at the ~~commencement date, has a ‘lease term’~~present value of ~~12 months or less and does not include an option to purchase~~ the underlying asset that the lessee is reasonably certain to exercise. Although short-term leases are in the scope of Topic 842, a simplified form of accounting is permitted. A lessee can elect, by class of underlying asset, not to apply the recognition requirements of Topic 842 and instead to recognizefuture lease payments at the lease ~~payments~~commencement date. The interest rate used to determine the present value is our incremental borrowing rate, estimated to be 10%, as the interest rate implicit in most of our leases is not readily determinable. Operating lease ~~cost~~expense is recognized on a straight-line basis over the lease term. ~~The Company has elected~~Since the ~~short-term method to account for these leases.~~common area maintenance expenses are expenses that do not depend on an index or rate, they are excluded from the measurement of the lease liability and recognized in other general and administrative expenses on the statements of operations.

~~F-20~~22

~~B2Digital, Incorporated~~

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, ~~2020~~2021

Right-of-use asset is summarized below:

Summary of right-of-use asset
	September 30, 2021
	Kokomo Lease			Valparaiso Lease			Merrill Lease			Tuscaloosa Lease			Birmingham Lease			Valparaiso Additional Lease			Total
Office lease	$	375,483		$	374,360		$	701,404		$	222,087		$	284,745		$	372,778		$	2,330,857
Less: accumulated amortization		(61,255	)		(102,574	)		(66,088	)		(39,078	)		(18,695	)		(3,114	)		(290,804	)
Right-of-use asset, net	$	314,228		$	271,786		$	635,316		$	183,009		$	266,050		$	369,664		$	2,040,053

Operating lease liability is summarized below:

Summary of operating lease liability
	September 30, 2021
	Kokomo Lease			Valparaiso Lease			Merrill Lease			Tuscaloosa Lease			Birmingham Lease			Valparaiso Additional Lease			Total
Office lease	$	322,413		$	271,786		$	681,570		$	183,009		$	266,051		$	375,884		$	2,100,713
Less: current portion		(63,246	)		(113,315	)		(95,730	)		(56,858	)		(48,163	)		(9,999	)		(387,311	)
Long term portion	$	259,167		$	158,471		$	585,840		$	126,151		$	217,888		$	365,885		$	1,713,402

Maturity of the lease liability is as follows:

Summary of maturity of lease liability
	September 30, 2021
	Kokomo Lease			Valparaiso Lease			Merrill Lease			Tuscaloosa Lease			Birmingham Lease			Valparaiso Additional Lease			Total
Fiscal year ending March 31, 2022	$	45,938		$	67,137		$	58,756		$	36,000		$	36,000		$	15,780		$	259,611
Fiscal year ending March 31, 2023		94,172			134,274			201,450			72,000			72,000			63,122			637,018
Fiscal year ending March 31, 2024		98,880			100,706			201,450			72,000			72,000			66,441			611,477
Fiscal year ending March 31, 2025		101,292			–			201,450			30,000			72,000			76,400			481,142
Fiscal year ending March 31, 2026		50,646			–			184,664			–			72,000			79,665			386,974
Fiscal year ending March 31, 2027		–			–			–			–			6,000			89,460			95,460
Fiscal year ending March 31, 2028		–			–			–			–			–			89,460			89,460
Fiscal year ending March 31, 2029		–			–			–			–			–			67,095			67,095
Present value discount		(68,515	)		(30,330	)		(166,199	)		(26,991	)		(63,949	)		(171,540	)		(527,524	)
Lease liability	$	322,413		$	271,786		$	681,570		$	183,009		$	266,051		$	375,884		$	2,100,713

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

NOTE 13 – COMMITMENTS AND CONTINGENCIES

During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with FASB ASC 450-20-50, Contingencies. The Company evaluates its exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably estimated, it establishes the necessary accruals. As of September 30, ~~2020,~~2021, the Company is not aware of any contingent liabilities that should be reflected in the consolidated financial statements.

The Company entered into an employment ~~agreements~~agreement with its ~~Chief Executive Officer and~~ Executive Vice President as of November 24, 2017. Under the terms of ~~these agreements~~the agreement, the Company will be liable for severance and other payments under certain conditions. The employment agreement ~~for the Executive Vice President~~ is for a period of 36 months and renews for a successive two years unless written notice is provided by either party under the terms of the agreement. ~~The employment agreement for~~

On November 29, 2020, with Greg P. Bell abstaining, the board of directors of the Company approved the Chairman of the Board and Chief Executive Officer ~~can be terminated by~~& President Agreement dated effective November 23, 2020 with Mr. Bell, the ~~Chief Executive Officer upon three months written notice. Termination~~Company’s Chairman of the ~~Chief Executive Officer requires~~Board, CEO, and President. The agreement supersedes the previous agreement of the same title dated effective November 24, 2017. The term of the agreement is until Mr. Bell is removed from his executive positions by 80% of the ~~votes of all stockholders~~voting control of the Company unless Mr. Bell is legally incapacitated (until legal capacity is regained), as determined by a court of competent jurisdiction or upon Mr. Bell’s death. Mr. Bell can terminate the agreement upon three months’ prior written notice to the Company.

Pursuant to the agreement, Mr. Bell is entitled to an annual salary of $120,000 and Mr. Bell was also issued 40,000,000 shares of the Company’s Series B Convertible Preferred Stock (the “Series B Preferred Stock”).

Each of the acquisition agreements contain a Management Services Agreement (“MSA”) whereby the Company agrees to pay a management fee based on certain performance targets. The MSA agreements expire 10 years from the acquisition agreement dates.

NOTE 14 - SUBSEQUENT EVENTS

Convertible Promissory Note

On October ~~2, 2020,~~8, 2021, the Company entered into ~~a Securities Purchase~~an Agreement with ~~GS Capital~~Geneva Roth Remark Holdings, Inc. pursuant to which the Company issued to ~~GS Capital~~Geneva Roth Remark Holdings, Inc. a ~~Convertible~~ Promissory Note in the aggregate principal amount of ~~$205,000. The Company received net proceeds of $195,000 after a $10,000 original note discount.~~$86,900. The note has a maturity date of October 2,8, 2022, and the Company has agreed to pay interest on the unpaid principal balance of the note at the rate of eight percent (8%) per annum from the date on which the note is issued until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company shall have the right to prepay the note, provided it makes a payment to Geneva Roth Remark Holdings, Inc. as set forth in the note.

B2DIGITAL, INCORPORATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2021

On October 26, 2021, the Company entered into an Agreement with Sixth Street Lending LLC pursuant to which the Company issued to Sixth Street Lending LLC a Promissory Note in the aggregate principal amount of $46,800. The note has a maturity date of October 26, 2022, and the Company has agreed to pay interest on the unpaid principal balance of the note at the rate of eight percent (8%) per annum from the date on which the note is issued until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company shall have the right to prepay the note, provided it makes a payment to GS Capital as set forth in the note.

The outstanding principal amount of the note is convertible into the Company’s common stock at the lender’s option at $0.01 per share for the first six months of the term of the note. After the six-month anniversary, the conversion price is equal to 63% of the average of the three lowest trading prices of the Company’s common stock. The initial accounting for this note is not completed.

On October ~~15, 2020,~~30, 2021, the Company entered into ~~a Securities Purchase~~an Agreement with GS Capital pursuant to which the Company issued to GS Capital a ~~Convertible~~ Promissory Note in the aggregate principal amount of ~~$172,000. The Company received net proceeds of $165,000 after a $7,000 original note discount.~~$270,480. The note has a maturity date of October ~~15, 2021~~19, 2022, and the Company has agreed to pay interest on the unpaid principal balance of the note at the rate of eight percent (8%) per annum from the date on which the note is issued until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company shall have the right to prepay the note, provided it makes a payment to GS Capital as set forth in the note.

~~The outstanding~~On November 3, 2021, the Company entered into an Agreement with GS Capital pursuant to which the Company issued to GS Capital a Promissory Note in the aggregate principal amount of $270,480. The note has a maturity date of November 3, 2022, and the Company has agreed to pay interest on the unpaid principal balance of the note at the rate of eight percent (8%) per annum from the date on which the note is ~~convertible~~issued until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise. The Company shall have the right to prepay the note, provided it makes a payment to GS Capital as set forth in the note.

Subscription Agreements

On October 26, 2021, the Company entered into a Subscription Agreement with Geneva Roth Remark Holdings for the ~~Company’s~~sale of 11,250,000 shares of common stock ~~at the lender’s option at $0.01~~for $45,000, or $0.004 per ~~share for the first six months~~share. As of the ~~term~~date of this filing, the ~~note. After~~shares have not been issued.

Amendments to Convertible Promissory Notes

Effective October 18, in order to memorialize a prior verbal agreement between the ~~six-month anniversary,~~Company and the ~~conversion price is equal to 63% of the average of the three lowest trading prices~~lender, each of the Company’s ~~common stock. The initial accounting for this note is not completed.~~notes issued on January 27, 2020, February 19, 2020, March 10, 2020, August 4, 2020, October 2, 2020, October 15, 2020, November 2, 2020, November 12, 2020, December 10, 2020, January 14, 2021, January 27, 2021, May 25, 2021, June 24, 2021, July 24, 2021, August 4, 2021, August 11, 2021, August 20, 2021, August 30, 2021, September 2, 2021, September 17, 2021, and September 30, 2021, respectively, the Company and a lender entered into amendments to the issued convertible promissory notes which extended each of the maturity dates to April 18, 2021. In addition, the lender waived any penalty interest that would have accrued due to any defaults.

~~F-21~~25

~~B2Digital, Incorporated~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS~~

~~SEPTEMBER 30, 2020~~

~~Common Stock Issuances~~

~~On October 1, 2020, the Company issued 33,934,759 shares of common stock in conversion of $108,000 in principal and $7,196 of accrued interest.~~

~~On October 15, 2020, the Company issued 14,521,245 shares of common stock in conversion of $45,000 in principal and $3,136 of accrued interest.~~

~~Lease~~

On October 1, 2020, the Company, under its subsidiary ONE More Gym LLC, entered into a facilities lease for 25,000 square feet in Kokomo, Indiana. The initial lease term is for five years and the lease commencement date is October 1, 2020. The Company will receive the first month’s rent free and will pay lease payments as follows:

Annual Lease Payments
Period
Year 1 $ 87,500
Year 2 91,875
Year 3 96,469
Year 4 101,292
Year 5 101,292
Total $ 478,428

~~The Company will analyze the lease to determine proper accounting in accordance with ASC 842.~~

~~Business Acquisition~~

Effective October 6, 2020, the Company completed an acquisition of 100% of the equity interest in CFit Indiana, Inc., doing business as Charter Fitness, a gym. Charter Fitness has two locations: one is Merrillville, Indiana and the other in Valparaiso, Indiana. The purchase price was $115,000 The initial accounting for this acquisition is not completed.

~~Common Stock Purchase Agreement~~

On October 21, 2020 the Company entered into a Common Stock Purchase Agreement (the “CSPA”) with Triton Funds, LP (“Triton”) (www.tritonfunds.com), the nation’s largest student venture investment fund, for an investment by Triton in the Company’s common equity of as much as $5 million. Triton has agreed to invest up to $2.5 million in common stock of B2Digital through the purchase of shares the Company has agreed to sell to Triton, subject to the terms and conditions set forth in the CSPA. In addition, in connection with the CSPA, Triton may invest up to an additional $2.5 million pursuant to warrant agreements.

~~F-22~~

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations contain certain forward-looking statements. Historical results may not indicate future performance. Our forward-looking statements reflect our current views about future events; are based on assumptions and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those contemplated by these statements. Factors that may cause differences between actual results and those contemplated by forward-looking statements include, but are not limited to, those discussed in the section titled “Risk Factors” of our Annual Report on Form 10-K for the year ended March 31, ~~2020~~2021 filed on ~~August 19, 2020.~~June 29, 2021. We undertake no obligation to publicly update or revise any forward-looking statements, including any changes that might result from any facts, events, or circumstances after the date hereof that may bear upon forward-looking statements. Furthermore, we cannot guarantee future results, events, levels of activity, performance, or achievements

Basis of Presentation

We have ~~seven~~eleven wholly-owned subsidiaries. Hardrock Promotions LLC which owns Hardrock MMA in Kentucky, Colosseum Combat LLC which owns Colosseum Combat MMA in Indiana, ~~Blue Grass MMA LLC which is a marketing company,~~ United Combat League MMA LLC, Pinnacle Combat LLC, Strike Hard Productions, LLC, ONE More Gym LLC, One More Gym Merrillville LLC, One More Gym Valparaiso LLC, One More Gym Tuscaloosa LLC, One More Gym Birmingham, Inc. and B2 Productions LLC.

The consolidated financial statements, which include the accounts of the Company and its ~~six~~eleven wholly owned subsidiaries, are prepared in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”). All significant intercompany balances and transactions have been eliminated.

Forward-Looking Statements

Some of the statements under “Management's Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Quarterly Report on Form 10-Q constitute forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar matters that are not historical facts. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “should,” and “would” or the negatives of these terms or other comparable terminology.

You should not place undue reliance on forward-looking statements. The cautionary statements set forth in this Quarterly Report on Form 10-Q identify important factors, which you should consider in evaluating our forward-looking statements. These factors include, among other things:

The unprecedented impact of COVID-19 pandemic on our business, customers, employees, consultants, service providers, stockholders, investors and other stakeholders;

The speculative nature of the business we intend to develop;

Our reliance on suppliers and customers;

Our dependence upon external sources for the financing of our operations, particularly given that there are concerns about our ability to continue as a “going concern;”

~~Our ability to effectively execute our business plan;~~

~~Our ability to manage our expansion, growth and operating expenses;~~

426

Our ability to ~~finance~~effectively execute our ~~businesses;~~business plan;

Our ability to ~~promote~~manage our ~~businesses;~~expansion, growth and operating expenses;

Our ability to finance our businesses;

Our ability to promote our businesses;

Our ability to compete and succeed in highly competitive and evolving businesses;

Our ability to respond and adapt to changes in technology and customer behavior; and

Our ability to protect our intellectual property and to develop, maintain and enhance strong brands.

Although the forward-looking statements in this Quarterly Report on Form 10-Q are based on our beliefs, assumptions and expectations, taking into account all information currently available to us, we cannot guarantee future transactions, results, performance, achievements or outcomes. No assurance can be made to any investor by anyone that the expectations reflected in our forward-looking statements will be attained, or that deviations from them will not be material and adverse. We undertake no obligation, other than as maybe be required by law, to update this Quarterly Report on Form 10-Q or otherwise make public statements updating our forward-looking statements.

Critical Accounting Policies

Basis of Accounting

The financial information furnished herein reflects all adjustments, consisting of normal recurring items that, in the opinion of management, are necessary for a fair presentation of the Company’s financial position, results of operations and cash flows for the interim periods. The results of operations for the three and six months ended September 30, ~~2020~~2021 are not necessarily indicative of the results to be expected for the year ending March 31, ~~2021.~~2022.

Use of Estimates

Cash and Cash Equivalents

The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. The Company maintains deposits primarily in four financial institutions, which may at times exceed amounts covered by insurance provided by the U.S. Federal Deposit Insurance Corporation ("~~FDIC"~~FDIC"). The Company has not experienced any losses related to amounts in excess of FDIC limits or $250,000. The Company did not have any cash in excess of FDIC limits at September 30, ~~2020~~2021 and ~~2019,~~March 31, 2021, respectively.

Fair Value of Financial Instruments

Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets.

Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The Company analyzes all financial instruments with features of both liabilities and equity under ASC 480, “Distinguishing Liabilities from Equity,” and ASC 815.

Property and Equipment

Goodwill

Goodwill represents the cost in excess of the fair value of net assets acquired in business combinations. The Company tests goodwill for impairment on an annual basis and when events or changes in circumstances indicate that the carrying amount may not be recoverable. Goodwill is deemed to be impaired if the carrying amount of goodwill exceeds its estimated fair value. As of September 30, ~~2020,~~2021, there were no ~~impairment charges.~~charges to goodwill impairment.

Other Income

During the three months ended September 30, 2021, the Company received $0 in grant income due to COVID-19 relief.

Revenue Recognition

The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of Financial Accounting Standards Board (“~~FASB”~~FASB”) Accounting Standards Codification (“~~ASC”~~ASC”) 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. The majority of revenues are received from ticket and beverage sales before and during the live events. Sponsorship revenue is also recognized when the live event takes place. Any revenue received for events that have yet to take place are recorded in deferred revenue.

Income Taxes

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk are cash, accounts receivable and other receivables arising from its normal business activities. The Company places its cash in what it believes to be credit-worthy financial institutions. The Company controls credit risk related to accounts receivable through credit approvals, credit limits and monitoring procedures. The Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk, establishes an allowance, if required, for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowance is limited. ~~In addition, Receivables that are factored through the Company's Receivable finance facility are guaranteed by the finance company that further mitigates Credit Risk.~~

Impairment of Long-Lived Assets

In accordance with ASC 360-10, the Company, on a regular basis, reviews the carrying amount of long-lived assets for the existence of facts or circumstances, both internally and externally, that suggest impairment. The Company determines if the carrying amount of a long-lived asset is impaired based on anticipated undiscounted cash flows, before interest, from the use of the asset. In the event of impairment, a loss is recognized based on the amount by which the carrying amount exceeds the fair value of the asset. Fair value is determined based on appraised value of the assets or the anticipated cash flows from the use of the asset, discounted at a rate commensurate with the risk involved. There were no impairment charges recorded during the three months ended September 30, 2021 and 2020, ~~and 2019.~~respectively.

Inventory

Inventories are valued at the lower of cost (determined on a weighted average basis) or market. Management compares the cost of inventories with the market value and allowance is made to write down inventories to market value, if lower. As of September 30, ~~2020~~2021 and March 31, ~~2020,~~2021, the Company ~~had outstanding balances of~~did not carry any finished goods ~~inventory of $1,445 and $7,256, respectively.~~inventory.

Earnings Per Share (EPS)

The Company utilize FASB ASC 260, Earnings per Share. Basic earnings (loss) per share is computed by dividing earnings (loss) available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include additional common shares available upon exercise of stock options and warrants using the treasury stock method, except for periods of operating loss for which no common share equivalents are included because their effect would be anti-dilutive. As of September 30, ~~2020~~2021, the convertible notes are indexed to ~~183,301,670~~810,258,880 shares of common stock.

The following table sets for the computation of basic and diluted earnings per share for the ~~six~~three months ended September 30, ~~2020~~2021 and ~~2019:~~2020:

	September 30, 2021			September 30, 2020
Basic and diluted
Net loss	$	(3,618,523	)	$	(1,764,859	)

Net loss per share
Basic	$	(0.00	)	$	(0.00	)
Diluted	$	(0.00	)	$	(0.00	)

Weighted average number of shares outstanding:
Basic & diluted		1,289,383,719			574,198,491

Stock Based Compensation

The Company records stock-based compensation in accordance with the provisions of FASB ASC Topic 718, ~~“Accounting~~Accounting for Stock Compensation”, which establishes accounting standards for transactions in which an entity exchanges its equity instruments for goods or services. In accordance with guidance provided under ASC.

On June 20, 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018-07 is intended to reduce cost and complexity and to improve financial reporting for share-based payments to nonemployees (for example, service providers, external legal counsel, suppliers, etc.). Under the new standard, companies will no longer be required to value non-employee awards differently from employee awards. Meaning that companies will value all equity classified awards at their grant-date under ASC 718 and forgo revaluing the award after this date. The Company adopted ASU 2018-07 on April 1, 2019. The adoption of this standard did not have a material impact on the consolidated financial statements.

During the three months ended September 30, 2021 and 2020, the Company recorded $0 in stock-compensation expense.

Leases

In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842). The updated guidance requires lessees to recognize lease assets and lease liabilities for most operating leases. In addition, the updated guidance requires that lessors separate lease and non-lease components in a contract in accordance with the new revenue guidance in ASC 606.

On January 1, 2019, the Company adopted ASU No. 2016-02, applying the package of practical expedients to leases that commenced before the effective date whereby the Company elected to not reassess the following: (i) whether any expired or existing contracts contain leases and; (ii) initial direct costs for any existing leases. For contracts entered into on or after the effective date, at the inception of a contract the Company assessed whether the contract is, or contains, a lease. The Company’s assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefit from the use of the asset throughout the period, and (3) whether it has the right to direct the use of the asset. The Company will allocate the consideration in the contract to each lease component based on its relative stand-alone price to determine the lease payments.

Operating lease right of use (“ROU”) assets represents the right to use the leased asset for the lease term and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most leases do not provide an implicit rate, the Company uses an incremental borrowing rate based on the information available at the adoption date in determining the present value of future payments. Lease expense for minimum lease payments is amortized on a straight-line basis over the lease term and is presented on the statements of operations.

As permitted under the new guidance, the Company has made an accounting policy election not to apply the recognition provisions of the new guidance to short term leases (leases with a lease term of twelve months or less that do not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise); instead, the Company will recognize the lease payments for short term leases on a straight-line basis over the lease term.

Recently Adopted Accounting Pronouncements

~~In January 2017, the FASB issued ASU No. 2017-04,~~ ~~Intangibles and Other (Topic 350): Simplifying the Test for Goodwill Impairment~~, which eliminates the requirement to calculate the implied fair value of goodwill, but rather requires an entity to record an impairment charge based on the excess of a reporting unit’s carrying value over its fair value. This amendment is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

~~In August 2018, the FASB issued ASU No. 2018-13,~~ ~~Fair Value Measurements (Topic 820): Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement~~. The amendments in this update modify the disclosure requirements on fair value measurements in Topic 820. The ASU is effective for the Registrants for fiscal years beginning after December 15, 2019, and interim periods therein. Early adoption is permitted. The Company is currently assessing the impact of this standard on their Financial Statements.

In September 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326), which replaces the incurred-loss impairment methodology and requires immediate recognition of estimated credit losses expected to occur for most financial assets, including trade receivables. Credit losses on available-for-sale debt securities with unrealized losses will be recognized as allowances for credit losses limited to the amount by which fair value is below amortized cost. ~~ASU 2016-13 is~~The new guidance was effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Recently, the ~~Company~~FASB voted to delay the implementation date for this accounting standard, for smaller reporting companies, the new effective date is beginning ~~January 1, 2020~~after December 15, 2022, and early adoption is permitted. The Company is currently evaluating the impact of the adoption of this ASU on the consolidated financial statements and is collecting and analyzing data that will be needed to produce historical inputs into any models created as a result of adopting this ASU. At this time, the Company does not believe the ~~potential impact~~adoption of this ASU will have a material effect on the ~~new guidance and related codification improvements will be material to its~~ financial ~~position, results of operations and cash flows.~~statements.

Organization and Nature of Business

Historically, we had been a provider of in-room, on-demand video entertainment and satellite services to the domestic lodging industry. In the past, we had provided video services to over 50,000 hotel rooms in the lodging industry. PPV lost a great deal of market share due to the increased internet use by hotel guests. With this loss, our Board of Directors agreed to dissolve Hotel Movie Network on March 11, 2010.

In February 2017, ~~the~~our Board of Directors ~~of B2Digital, Incorporated, a Delaware corporation (“~~~~B2Digital~~~~” or the “~~~~Company~~”) approved a complete restructuring, new management team and strategic direction for the Company. Capitalizing on ~~its~~management’s history in television, video and technology, we are now forging ahead and becoming a full-service live event sports company.

Our Chairman and CEO is now Greg P. Bell. Mr. Bell has over 30 years of global experience developing more than 20 companies in the sports, television, entertainment, digital distribution and banking transaction industries. Capitalizing on the combination of his expertise, relationships and experience as well as his involvement with more than 40,000 live events over his career for major sports leagues and entertainment venues, we are in the process of developing and acquiring companies to become a premier vertically integrated live event sports company.

Our first strategy is to build an integrated live event minor league for the mixed martial arts (“MMA”) marketplace, which is a billion-dollar industry. We are creating and developing minor league champions that will move on to the MMA major leagues from the B2 Fighting Series (“B2FS”). This will be accomplished by sponsoring operating live events, acquiring existing MMA promotions and then inviting those champions to the B2FS Regional and National Championship Series. We own all media and merchandising rights and digital distribution networks for the B2FS. This concept was developed and test marketed for two years by Mr. Bell’s B2 Management Group, LLC.

2017 marked the kickoff of the B2FS by sponsoring and acquiring MMA regional promotion companies for the development of the B2FS. Our second strategy is to add additional sports, leagues, tournaments and special events to our live event business model. This will enable us to capitalize on our core technologies and business models that will be key to broadening the revenue base of our live event core business. We will also be developing and expanding the B2Digital live event systems and technologies. These include systems for event management, digital ticketing sales, digital video distribution, digital marketing, Pay-Per View (“PPV”), fighter management, merchandise sales, brand management and financial control systems.

~~Business of the Company~~

The Company has seven wholly-owned subsidiaries. Hardrock Promotions LLC which owns Hardrock MMA in Kentucky, Colosseum Combat LLC which owns Colosseum Combat MMA in Indiana, United Combat League MMA LLC, Pinnacle Combat LLC, Strike Hard Productions, LLC, ONE More Gym, and B2 Productions LLC.

Results of Operations

Three Months Ended September 30, ~~2020~~2021 Compared to the Three Months Ended September 30, ~~2019~~2020

Revenue

We had revenues of $660,010 for the three months ended September 30, 2021, versus revenues of $135,927 for the three months ended September 30, ~~2020 versus revenues~~2020. There was an increase of ~~$96,275~~$252,853, or 834% in live event revenue due to the reopening of live events as there continues to be a partial recovery from the effects of COVID-19. There was also an increase in gym revenue of $271,230, or 257% primarily as a result of the Company acquiring four gyms since the comparative period.

Cost of Sales

We incurred cost of sales of $327,682 for the three months ended September 30, 2019. There was a decrease of $65,957 in live event revenue due to the effects of COVID-19. There was an increase in gym revenue of $105,609, or 100% as the Company acquired a gym since the comparative period.

~~Cost of Sales~~

~~We incurred~~2021, versus cost of sales of $47,907 for the three months ended September 30, ~~2020 versus cost~~2020. This increase of ~~sales of $73,588~~$279,775 is directly attributable to the increase in live event revenue and gym revenue for the three months ended September 30, ~~2019. The decrease of $25,681 is due to a decrease in live events due to the effects of COVID-19.~~2021.

Operating Expenses

General & Administrative Expenses

General and administrative expenses include ~~professional fees,~~ all costs associated with professional fees, salaries, marketing, ~~press releases,~~ public relations, rent, travel, sponsorships and other expenses. We incurred general and administrative expenses of $1,854,487 for the three months ended September 30, 2021, versus general and administrative expenses of $675,129 for the three months ended September 30, ~~2020 versus general and administrative expenses of $349,297 for the three months ended September 30, 2019.~~2020. The increase of ~~$325,832~~$1,179,358 was primarily due to increased operations as a result of gym acquisitions, ~~and~~ investor relations, ~~and~~salaries, travel, professional fees ~~due~~and other costs associated with expanding infrastructure as we continue to ~~the~~execute our growth ~~of the business.~~strategy.

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Depreciation and Amortization Expense

We incurred depreciation and amortization expense of ~~$33,883~~$98,470 for the three months ended September 30, ~~2020~~2021, versus depreciation expense of ~~$6,741~~$33,833 for the three months ended September 30, ~~2019.~~2020. The increase of ~~$27,142~~$64,587 was due to the purchase of fixed and intangible assets as a result of business ~~acquisitions.~~acquisitions and infrastructure growth.

Other Income (Expense)

~~Other Income (Expense)~~

Our other income and expenses include ~~gain~~loss on sale of assets, loss on the forgiveness of ~~loan, loss~~notes receivable, gain on extinguishment of debt, change in fair value of derivative liabilities and interest expense. The increase of ~~$568,297~~$288,186 (net expense) was primarily due to an increase in interest expense and negative changes in the fair value of derivative instruments.

Net Losses

We incurred a net loss of $2,557,176 for the three months ended September 30, 2021, versus a net loss of $1,269,353 for the three months ended September 30, ~~2020 versus a net loss of $413,415 for the three months ended September 30, 2019.~~2020.

~~Results of Operations~~

Six Months Ended September 30, ~~2020~~2021 Compared to the Six Months Ended September 30, ~~2019~~2020

Revenue

We had revenues of $1,228,775 for the six months ended September 30, 2021, versus revenues of $195,948 for the six months ended September 30, ~~2020 versus revenues~~2020. There was an increase of ~~$181,911~~$488,385 or 1,608% in live event revenue due to the reopening of live events as there continues to be a partial recovery from the effects of COVID-19. There was also an increase in gym revenue of $544,442, or 516% primarily as a result of the Company acquiring four gyms since the comparative period.

Cost of Sales

We incurred cost of sales of $531,184 for the six months ended September 30, 2019. There was a decrease of $151,534 in live event revenue due to the effects of COVID-19. There was an increase in gym revenue of $165,571, or 100% as the Company acquired a gym since the comparative period.

~~Cost of Sales~~

~~We incurred~~2021, versus cost of sales of $49,219 for the six months ended September 30, ~~2020 versus cost~~2020. This increase of ~~sales of $135,540~~$481,965 is directly attributable to the increase in live event revenue and gym revenue for the six months ended September 30, ~~2019. The decrease of $86,321 is due to a decrease in live events due to the effects of COVID-19.~~2021.

Operating Expenses

General & Administrative Expenses

General and administrative expenses include ~~professional fees,~~ all costs associated with professional fees, salaries, marketing, ~~press releases,~~ public relations, rent, travel, sponsorships and other expenses. We incurred general and administrative expenses of $3,408,367 for the six months ended September 30, 2021, versus general and administrative expenses of $839,917 for the six months ended September 30, ~~2020 versus general~~2020. The increase of $2,568,450 was primarily due to increased operations as a result of gym acquisitions, investor relations, salaries, travel, professional fees and ~~administrative expenses~~other costs associated with expanding infrastructure as we continue to execute our growth strategy.

Depreciation and Amortization Expense

We incurred depreciation and amortization expense of ~~$859,810~~$186,519 for the six months ended September 30, ~~2019. The decrease of $19,893 was a result of decreased live events due to COVID-19 but this decrease was partially offset by the increase in G&A at the gym.~~

~~Depreciation and Amortization Expense~~

~~We incurred~~2021, versus depreciation ~~and amortization~~ expense of $66,855 for the six months ended September 30, ~~2020 versus depreciation expense of $10,053 for the six months ended September 30, 2019.~~2020. The increase of ~~$56,802~~$119,664 was due to the purchase of fixed and intangible assets aas result of business ~~acquisitions.~~acquisitions and infrastructure growth.

Other Income (Expense)

~~Other Income (Expense)~~

Our other income and expenses include gain on forgiveness of loan, ~~grant income,~~loss on sale of assets, loss on the forgiveness of notes receivable, loss on settlement of debt, ~~loss~~(loss) on extinguishment of debt, change in the fair value of derivative liabilities and interest expense. The ~~increase~~decrease of ~~$923,381~~$283,588 (income) was primarily due to ~~interest expense and~~positive changes in fair value of derivative ~~instruments.~~instruments and gains on extinguishment of debt which were partially offset by an increase in interest expense.

Net Losses

We incurred a net loss of $3,618,523 for the six months ended September 30, 2021, versus a net loss of $1,764,859 for the six months ended September 30, ~~2020 versus a net loss of $904,927 for the six months ended September 30, 2019.~~2020.

Current Liquidity and Capital Resources for the six months ended September 30, ~~2020~~2021 compared to the six months ended September 30, ~~2019~~2020

							September 30,
	2020			2019			2021			2020
Summary of Cash Flows:
Net cash used by operating activities	$	(574,939	)	$	(184,942	)	$	(2,634,963	)	$	(574,939	)
Net cash used by investing activities		(128,501	)		(206,230	)		(421,156	)		(128,501	)
Net cash provided by financing activities		718,282			400,000			3,207,855			718,282
Net increase in cash and cash equivalents		14,842			8,828			151,736			14,842
Beginning cash and cash equivalents		46,729			27,579			122,176			46,729
Ending cash and cash equivalents	$	61,571		$	36,407		$	273,912		$	61,571

Operating Activities

Cash used in operations of $2,634,963 during the six months ended September 30, 2021 was primarily a result of our $3,618,523 net loss reconciled with our net non-cash expenses relating to stock compensation, depreciation and amortization expense, gain on forgiveness of loan, legal fees on convertible notes, gain on extinguishment of debt, interest expense on extinguishment of debt, loss on sale of assets, amortization of debt discount, inventory, changes in fair value of derivative liabilities, right-of-use asset/liability, prepaid expenses, accounts receivable, deferred revenue and accrued liabilities.

Cash used in operations of $574,939 during the six months ended September 30, 2020 was primarily a result of our $1,764,859 net loss reconciled with our net non-cash expenses relating to stock compensation, depreciation and amortization expense, loss on settlement of debt, loss on extinguishment of debt, gain on settlement of debt, grant income, amortization of debt discount, changes in fair value of derivative liabilities, inventory, prepaid expenses, ~~accounts payable,~~ accrued liabilities and deferred compensation. Cash used in operations of $184,942 during the six months ended September 30, 2019 was primarily a result of our $904,927 net loss reconciled with our net non-cash expenses relating to stock compensation, depreciation expense, loss on settlement of debt, loss on extinguishment of debt, inventory, prepaid expenses, accounts payable, accrued liabilities and deferred compensation.revenue.

Investing Activities

Net cash used in investing activities for the six months ended September 30, 2021, of $421,156 resulted from the payments of $165,000 related to business combinations and capital expenditures in the amount of $256,156. Net cash used in investing activities for the six months ended September 30, 2020, of $128,501 resulted ~~from the~~ from the payments to related parties in the amount of $470 and capital expenditures in the amount of $128,031. Net cash used in investing activities for the six months ended September 30, 2019 of $206,230 resulted from the payments to related parties in the amount of $174,245 and capital expenditures in the amount of $31,985.

Financing Activities

Net cash provided by financing activities was $3,207,855 for six months ended September 30, 2021, which consisted of $150,000 from the issuance of notes payable, $2,096,681 from the issuance of convertible notes payable, $207,863 in payments related to repayment of convertible notes payable, $8,609 repayment on notes payable, $2,354 in payment of note payable and $1,180,000 in proceeds from the issuance of common stock.

Net cash provided by financing activities was $718,282 for six months ended September 30, 2020, which consisted of $122,766 from ~~proceeds from~~ the issuance of notes payable, $150,000 ~~from proceeds~~ from the issuance of convertible notes payable, $15,000 in payments related to payable due for business ~~acquisitions,~~combinations, $4,484 payment on notes payable, and $465,000 in proceeds from the issuance of common stock. ~~Net cash provided by financing activities was $400,000 for six months ended September 30, 2019, which consisted of $400,000 in proceeds from the issuance of common stock.~~

Future Capital Requirements

Our current available cash and cash equivalents are insufficient to satisfy our liquidity requirements. Our capital requirements for fiscal year 2020 will depend on numerous factors, including management’s evaluation of the timing of projects to pursue. Subject to our ability to generate revenues and cash flow from operations and our ability to raise additional capital (including through possible joint ventures and/or partnerships), we expect to incur substantial expenditures to carry out our business plan, as well as costs associated with our capital raising efforts and being a public company.

Our plans to finance our operations include seeking equity and debt financing, alliances or other partnership agreements, or other business transactions, that would generate sufficient resources to ensure continuation of our operations.

The sale of additional equity or debt securities may result in additional dilution to our shareholders. If we raise additional funds through the issuance of debt securities or preferred stock, these securities could have rights senior to those of our common stock and could contain covenants that would restrict our operations. Any such required additional capital may not be available on reasonable terms, if at all. If we were unable to obtain additional financing, we may be required to reduce the scope of, delay or eliminate some or all of our planned activities and limit our operations which could have a material adverse effect on our business, financial condition and results of operations.

Inflation

The amounts presented in our consolidated financial statements do not provide for the effect of inflation on our operations or financial position. The net operating losses shown would be greater than reported if the effects of inflation were reflected either by charging operations with amounts that represent replacement costs or by using other inflation adjustments.

Going Concern

The accompanying financial statements have been prepared on a going concern basis. For the six months ended September 30, ~~2020,~~2021, the Company had a net loss of ~~$1,764,859,~~$3,618,523, had net cash used in operating activities of ~~$574,939,~~$2,634,963, had negative working capital of ~~$1,597,844,~~$5,589,042, accumulated deficit of ~~$5,581,837~~$12,815,771 and stockholders’ deficit of ~~$931,436.~~$3,946,129. These matters raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the date of this filing. The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due, to fund possible future acquisitions, and to generate profitable operations in the future. Management plans to provide for the Company’s capital requirements by continuing to issue additional equity and debt securities. The outcome of these matters cannot be predicted at this time and there are no assurances that, if achieved, the Company will have sufficient funds to execute its business plan or generate positive operating results. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Quantitative and Qualitative Disclosures about Market Risk

In the ordinary course of our business, we are not exposed to market risk of the sort that may arise from changes in interest rates or foreign currency exchange rates, or that may otherwise arise from transactions in derivatives.

The preparation of financial statements in conformity with GAAP requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Our significant estimates and assumptions include the fair value of our common stock, stock-based compensation, the recoverability and useful lives of long-lived assets, and the valuation allowance relating to our deferred tax assets.

Contingencies

Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. Our management, in consultation with its legal counsel as appropriate, assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against us or unasserted claims that may result in such proceedings, we, in consultation with legal counsel, evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in our financial statements. If the assessment indicates a potentially material loss contingency is not probable, but is reasonably possible, or is probable, but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

As a smaller reporting company, the Company has elected not to provide the disclosure required by this item.

Item 4.

Controls and Procedures.

Disclosure Controls and Procedures

The Company has established disclosure controls and procedures that are designed to ensure that information required to be disclosed in reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission and, as such, is accumulated and communicated to the Company’s Chief Executive Officer, Greg P. Bell, who serves as our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Mr. Bell, evaluated the effectiveness of the Company’s disclosure controls and procedures, as defined in Rule 13a-15(e) of the Exchange Act, as of September 30, ~~2020.~~2021. Based on his evaluation, Mr. Bell concluded that the Company’s disclosure controls and procedures were effective as of September 30, ~~2020.~~2021.

Changes in Internal Control Over Financial Reporting

There has been no change in the Company’s internal control over financial reporting, as defined in Rules 13a-15(f) of the Exchange Act, during the Company’s most recent fiscal quarter ended September 30, ~~2020,~~2021, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

1337

PART II—OTHER INFORMATION

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

~~Shares Issued for Services~~Convertible Note Issuances

~~During the quarter ended~~Between July 1, 2021, and September 30, 2020, the Company issued an aggregate of 11,733,333 shares of Common Stock in exchange for services valued at an aggregate of $74,933. These issuances were made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act.

~~Shares Sold Pursuant to Regulation A~~

During the quarter ended September 30, 2020, the Company sold an aggregate of 62,000,002 shares of Common Stock for aggregate consideration of $465,000. These sales were made without registration under the Securities Act by reason of the exemption from registration afforded by the provisions of Regulation A of the Securities Act. There were no sales commissions paid pursuant to this transaction.

~~Convertible Note~~

~~On August 4, 2020, the Company entered into a Securities Purchase Agreement with GS Capital pursuant to which the Company~~2021, we issued to ~~GS Capital a~~“accredited investors,” Convertible Promissory ~~Note in the~~Notes aggregating a principal amount of $156,000. This note was issued without registration under the Securities Act of 1933, as amended, by reason of the exemption from registration afforded by the provisions of Section 4(a)(2) thereof, and Rule 506(b) promulgated thereunder, as a transaction by an issuer not involving any public offering. No selling commissions were paid in connection with the issuance of the note.$1,864,595.

~~Shares Issued Pursuant to Note Conversions~~

During the quarter ended September 30, 2020, lenders converted an aggregate of $80,434 in principal and accrued and unpaid interest of their promissory notes into an aggregate of 25,663,705 shares of the Company’s Common Stock. The securitiesThese Notes were issued without registration under the Securities Act of 1933, as amended, by reason of the exemption from registration afforded by the provisions of Section 4(a)(2) thereof, and Rule 506(b) promulgated thereunder, as ~~a transaction~~transactions by an issuer not involving any public offering. No selling commissions were paid in connection with the ~~issuance~~issuances of the ~~securities.~~notes.

Use of Proceeds

On February 2, 2021, our Registration Statement on Form S-1 (File No. 333-251846) was declared effective by the SEC and the offering was commenced upon effectiveness and is still ongoing as all of the 625,000,000 (for gross proceeds of $2,500,000) offered shares have not been sold and the offering has not been terminated.

During the quarter ended September 30, 2021, we sold a total of 75,000,000 shares of Common Stock for gross proceeds of $300,000. We did not pay any fees or commissions from the sales and received net proceeds of $300,000. The net proceeds were used as follows: 1) acquisition of gyms - $45,000, 2) cap-ex - $94,882, 3) Repayment of convertible notes - $142,491, and 4) working capital - $17,627.

Item 6.

Exhibits.

SEC Ref. No.	Title of Document
31.1*	Rule 13a-14(a) Certification by Principal Executive and Financial Officer
32.1**	Section 1350 Certification of Principal Executive and Financial Officer
101.INS*	Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
101.SCH101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*	Cover Page Interactive Data File (formatted in IXBRL, and included in exhibit 101).

__________________

*Filed with this Report.

**Furnished with this Report.

1438

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	B2Digital, Incorporated


Date: November ~~2, 2020~~15, 2021	By	/s/ Greg P. Bell
		Greg P. Bell, Chief Executive Officer
		(Principal Executive Officer and Principal
		Financial Officer)

1539

	As of September 30, 2020			As of March 31, 2020
Assets
Current assets
Cash and cash equivalents	$	61,571		$	46,729
Inventory		1,445			7,256
Deposits and prepaid expenses		5,445			3,120
Total current assets		68,461			57,105

Property and equipment, net of accumulated depreciation		428,168			351,393
Intangible assets, net of accumulated amortization		181,353			196,951
Goodwill		172,254			172,254
Total Assets	$	850,236		$	777,703

Liabilities & Stockholders' Deficit
Current liabilities
Accounts payable & accrued liabilities	$	162,309		$	131,700
Deferred revenue		40,588			13,992
Note payable- current maturity		122,800			34,162
Note payable- in default		14,000			–
Payable due for business acquisitions		–			15,000
Convertible notes payable		726,953			598,150
Derivative liabilities		599,454			58,790
Due to shareholder		241			711
Total current liabilities		1,666,345			852,505

Note payable- long-term		115,327			136,565

Total Liabilities		1,781,672			989,070

Commitments and contingencies (Note 13)

Stockholders' Deficit
Preferred stock, 50,000,000 shares authorized, 40,000,000 shares of Series B designated and none outstanding; 2,000,000 shares of Series A, convertible into 240 shares of common stock issued and outstanding at September 30, 2020 and March 31, 2020, respectively; 8,000,000 shares are undesignated		20			20
Common stock, $0.00001 par value; 5,000,000,000 shares authorized; 658,957,259 and 539,267,304 shares issued and outstanding at September 30, 2020 and March 31, 2020, respectively		6,590			5,394
Additional paid in capital		4,643,791			3,600,197
Accumulated deficit		(5,581,837	)		(3,816,978	)
Total Stockholders' Deficit		(931,436	)		(211,367	)
Total Liabilities and Stockholders' Deficit	$	850,236		$	777,703

	Preferred Stock				Common Stock				Additional Paid in		Accumulated
	Shares		Amount		Shares		Amount		Capital		Deficit			Total
Balance March 31, 2020		2,000,000		20		539,267,304	$	5,394	$	3,600,197	$	(3,816,978	)	$	(211,367	)

Issuance of common stock for services		–		–		4,000,000		40		14,360		–			14,400

Conversion of notes payable		–		–		16,292,915		163		55,459		–			55,622

Net loss		–		–		–		–		–		(495,506	)		(495,506	)

Balance June 30, 2020		2,000,000		20		559,560,219		5,597		3,670,016		(4,312,484	)		(636,851	)

Sale of common stock		–		–		62,000,002		620		464,380		–			465,000

Issuance of common stock for services		–		–		11,733,333		117		74,816		–			74,933

Conversion of notes payable		–		–		25,663,705		256		434,579		–			434,835

Net loss		–		–		–		–		–		(1,269,353	)		(1,269,353	)

Balance September 30, 2020		2,000,000		20		658,957,259	$	6,590	$	4,643,791	$	(5,581,837	)	$	(931,436	)

	September 30, 2020			September 30, 2019
Basic and diluted
Net loss	$	(1,764,859	)	$	(904,927	)

Net loss per share
Basic	$	(0.00	)	$	(0.00	)
Diluted	$	(0.00	)	$	(0.00	)

Weighted average number of shares outstanding:
Basic & diluted		574,198,491			471,101,799

	Note 1		Note 2		Note 3		Note 4		Note 5		Note 6		Note 7			Note 8	Total
Compound embedded derivative	$	26,395	$	68,030	$	15,893	$	10,812	$	25,834	$	14,095	$	17,636	$	42,463	$	221,156
Convertible notes payable		48,605		133,970		44,107		49,188		152,666		60,905		57,364		107,537		654,344
Original issue discount		7,000		6,000		2,000		2,000		5,500		3,000		3,000		6,000		34,500
Face value	$	82,000	$	208,000	$	62,000	$	62,000	$	184,000	$	78,000	$	78,000	$	156,000	$	910,000

Note	Interest Expense		Accrued Interest Balance		Amortization of Debt Discount		Unamortized Discount
Note 1	$	1,015	$	–	$	18,870	$	0
Note 2		8,343		13,958		33,352		19,945
Note 3		2,487		4,077		8,335		4,685
Note 4		2,487		3,723		5,955		3,225
Note 5		7,380		9,961		15,408		11,101
Note 6		3,129		3,829		8,186		7,640
Note 7		3,129		3,488		9,774		9,374
Note 8		6,975		6,975		3,386		45,077
	$	34,945	$	46,011	$	103,266	$	101,047

	September 30, 2020
Balance at April 1, 2020	$	58,790
Issuances:
Compound embedded derivatives		42,463
Conversions		(289,206	)
Loss on changes in fair value inputs and assumptions reflected in income		787,407
Balance at September 30, 2020	$	599,454

	Annual Lease Payments
Period
Year 1	$	87,500
Year 2		91,875
Year 3		96,469
Year 4		101,292
Year 5		101,292
Total	$	478,428