UNITED
STATES

SECURITIES
AND EXCHANGE COMMISSION

WASHINGTON,
D.C. 20549



FORM
10-K



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



For
the fiscal year ended December 31, 2021



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



For
the transition period from _________ to ________



Commission
file number: 000-21202



Resonate
Blends, Inc.






(Exact
name of registrant as specified in its charter)



|Nevada                                                                                                                                                                                                                              |  | 58-1588291                                                                                                                                                                                               
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(State
                                            or other jurisdiction of
                                                                             incorporation
                                            or organization) |  | (I.R.S.
                                            Employer
                                                                             Identification
                                            No.)
|                                                                                                                                                                                                                                    |  |                                                                                                                                                                                                          
|26565
                                            Agoura Road, Suite 200
    Calabasas,
    CA                                                                                                                                      |  | 91302                                                                                                                                                                                                    
|(Address
    of principal executive offices)                                                                                                                                                                                        |  | (Zip
    Code)                                                                                                                                                                                           



Registrant’s
telephone number: 571-888-0009



Securities
registered under Section 12(b) of the Exchange Act: None



Securities
registered under Section 12(g) of the Exchange Act:



Title
of each class

Common
Stock, par value of $0.0001



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



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



Indicate
by checkmark 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 emerging growth company.



|☐ 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 ☒



State
the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which
the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s
most recently completed second fiscal quarter was $14,258,608.



Indicate
the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date. 47,796,859common shares as of April 14, 2022.


















TABLE
OF CONTENTS



|             |                                                                                                                 |  | Page
|------------ | --------------------------------------------------------------------------------------------------------------- |  | ----
|             | PART I                                                                                                          |  |     
|             |                                                                                                                 |  |     
|Item
    1.  | Business                                                                                                        |  | 3   
|Item
    1A. | Risk Factors                                                                                                    |  | 9   
|Item
    1B. | Unresolved Staff Comments                                                                                       |  | 19  
|Item
    2.  | Properties                                                                                                      |  | 19  
|Item
    3.  | Legal Proceedings                                                                                               |  | 19  
|Item
    4.  | Mine Safety Disclosures                                                                                         |  | 19  
|             |                                                                                                                 |  |     
|             | PART II                                                                                                         |  |     
|             |                                                                                                                 |  |     
|Item
    5.  | Market for Registrant’s Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities |  | 20  
|Item
    6.  | Selected Financial Data                                                                                         |  | 21  
|Item
    7.  | Management’s Discussion and Analysis of Financial Condition and Results of Operations                           |  | 21  
|Item
    8.  | Financial Statements and Supplementary Data                                                                     |  | 25  
|Item
    9.  | Changes In and Disagreements With Accountants on Accounting and Financial Disclosure                            |  | 26  
|Item
    9A. | Controls and Procedures                                                                                         |  | 26  
|Item
    9B. | Other Information                                                                                               |  | 27  
|Item
    9C  | Disclosure Regarding Foreign Jurisdictions that Prevent Inspections                                             |  | 27  
|             |                                                                                                                 |  |     
|             | PART III                                                                                                        |  |     
|             |                                                                                                                 |  |     
|Item
    10. | Directors, Executive Officers and Corporate Governance                                                          |  | 27  
|Item
    11. | Executive Compensation                                                                                          |  | 30  
|Item
    12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                  |  | 32  
|Item
    13. | Certain Relationships and Related Transactions, and Director Independence                                       |  | 32  
|Item
    14. | Principal Accountant Fees and Services                                                                          |  | 33  
|             |                                                                                                                 |  |     
|             | PART IV                                                                                                         |  |     
|             |                                                                                                                 |  |     
|Item
    15. | Exhibits, Financial Statement Schedules                                                                         |  | 34  
|Item
    16. | Form 10-K Summary                                                                                               |  | 34  



2







PART
I



Forward-Looking
Statements



This
Annual Report on Form 10-K contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of
1995. Certain statements, other than purely historical information, including estimates, projections, statements relating to our business
plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking
statements.” These forward-looking statements generally are identified by the words “believes,” “project,”
“expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,”
“may,” “will,” “would,” “will be,” “will continue,” “will likely result,”
and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties
which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual
effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on our operations and
future prospects on a consolidated basis include but are not limited to: changes in economic conditions, legislative/regulatory changes,
availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should
also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.



Item
1. Business



Overview



On
October 25, 2019, Resonate Blends, Inc. (formerly Textmunication Holdings Inc.) announced its entry into the cannabis industry by acquiring
Resonate Blends LLC (“Resonate” or the “Company”), a California-based cannabis wellness lifestyle product company
built on a proprietary system of experiential targets. Resonate is building a value-added, brand-focused cannabis organization offering
premium brands of consistent quality. The Company also acquired Entourage Labs LLC (“Entourage Labs”), a sister company of
Resonate. Entourage Labs is the Intellectual Property (IP) subsidiary of Resonate.



Based
in Calabasas, California, Resonate Blends is a cannabis holding company centered on valued-added holistic Wellness and Lifestyle brands.
The Company’s strategy is to ignite future growth by building a purpose-driven portfolio of innovative, trusted national brands,
emerging brands, research organizations, and a variety of retail channels. The Company’s focus is finding mutual value between
product and consumer by optimizing quality, supply chain resources and financial performance. The Company offers a family of premium
cannabis-based products of consistent quality based on unique formations calibrated to Resonate Blends effects system in what the Company
believes is the industry gold standard in user experience.



Resonate
believes the greatest long-term value creation in the cannabis industry will be in the establishment of high quality and consistent consumer
brands. Resonate hopes to become a national leader through its vision in creating a family of brands designed specifically to deliver
reliable, effective and beneficial experiences.



Resonate
is committed to helping people live the life they love, but they do not make the medicinal vs. recreational distinction. This is a temporary
legal separation in some states that should soon cease to exist. The Company believes in wellness for the whole person, including
people with insomnia, pain or anxiety who also want to enjoy friends, concerts and have satisfying intimate experiences. Resonate
is designing experiences which should improve all areas of ones’ life.



To
accomplish this, Resonate is Mastering the Art of Experience. This is the Company’s mission. By integrating science, technology,
education, branding, marketing, sales and delivery - with every customer interaction they aim to provide exceptional experiences. Cannabis
has a broad range of unique characteristics, and they are dedicated to harnessing and amplifying those characteristics to support healthy
empowered and engaged lifestyles. From product development through customer communication, they prefect and demystify cannabis bringing
innovative products to an increasingly sophisticated market. Resonate Blends has a strong social mission and the Resonate team is building
a successful business by focusing its knowledge, skill and energy on creating wellness-lifestyle products which will improve community
by helping individuals live more satisfying, meaningful and connected lives. The need for these products currently is crucial.



3







To
communicate the breadth of wellness products that Resonate is developing, the Company created The Resonate System. The Resonate System
graphically represents a spectrum of wellness products based on cannabis scaffolding. This system helps users easily select which product
they want. Products based on The Resonate System deliver relaxation, freedom from pain and anxiety, boosts in focus and creativity, sensuality,
human connection and joy. Koan products are formulated around a system of interconnected experience targets that will allow you to know
exactly what to expect when using them.



While
respecting and honoring the natural power of plant medicine, Resonate also employs advanced science, leading technology and a deep understanding
of how various cannabis compounds, when working in the body, simultaneously can create unique effects and benefits (referred to as the
“Entourage Effect”). Product developers blend cannabinoids and terpenes to formulate products with specific, controllable
and repeatable beneficial effects. Through innovation, experimentation, testing and an iterative product development strategy,
the Koan team has unlocked new plant constituent combinations resulting in unique, enjoyable and extremely effective wellness
products unlike anything else in the marketplace. Resonate has filed a provisional patent for protection of these formulations and products
in the future.



Koan,
the Resonate Blends product family, is based around a comprehensive system of interconnected experience targets that allow people to
select the products that best fit their lifestyle and health objectives. Koan products are dedicated to the efficacy and precision of
functional experience targets across a broad range of product categories.



Resonate’s
initial products are a completely unique class of products called Cordials. These blends offer a wide range of experiences not currently
available in the cannabis market. Cordials are water-soluble and use nano-emulsification technology to allow for quick onset and a sustained
and nuanced experience. Single dose, healthful, subtle in taste, cordials are an ideal way for people to intentionally improve their
well-being. They can be shipped directly or substituted for alcohol as a cocktail mixer. A significant competitive advantage is that
the Cordials allow users to select both the experience they want and the beverage they choose to enjoy them in.



Resonate’s
Cordials have been developed in partnership with an award-winning advanced infusion technology partner and were launched to the
retail channel in late Q2 of 2021. The company is offering six unique formulations and expects to launch an additional blend “Love” by
Q1 2022 and a “Sleep” formulation in Q2 2022. The Cordials were awarded the Golden Leaf Award as “Best New
Brand of 2021” at the “Luxury Meets Cannabis Conference” held in New York City in December. Resonate also won a
Cannabis Clio Award for “Brand Design” also in December.



Resonate
has formalized contracts with logistical, sales and marketing partners to build a digital native strategy supporting Direct-to-Consumer
sales. The Direct-to-Consumer (D2C) sales platform launched in October and now allows California consumers the ability to order on-line
and have the Cordials home delivered in most metro areas within four hours. Based on customer demand, the Company is creating a “singles”
option for the Cordials which will be available in early 2022 and a multi-dose option shipping in early Q2 2022.



The
principal executive office is located at 26565 Agoura Road, Suite 200, Calabasas, CA 91302. The executive telephone number is (571) 888-0009.



Partnerships



Product
Development:



The
Company signed a custom development contract with Vertosa in March of 2020, the leading provider of safe, reliable emulsion bases for
infused product developers. This contract was a major milestone for the Company as it selected its strategic partners to develop innovative
products and solutions.



Vertosa
is an award-winning strategic partner who will assist the Company in the launch of its first unique category of six water soluble products.
These multi-use products deliver specific, predictable, reliable, effects in a format that is completely unique in the industry. The
first product developed collaboratively is the Cordial product line, but both companies expect several other products to be developed
over time utilizing Vertosa’s emulsification technology.



In addition to the new Cordial blends, the company
also expects to launch a unique edible product line to the market in mid-2022.



4







The
Vertosa and Resonate teams share a mission of maximizing the benefits of cannabinoids and plant medicine. Resonate selected Vertosa as
a development partner because the Vertosa systems’ industry leading emulsification technology makes them highly stable, bioavailable,
and water compatible. All of Vertosa’s inactive base materials are FDA approved and are lab tested for quality. Vertosa’s
Hemp-derived CBD Emulsion System is now certified organic by CCOF, a United States Department of Agriculture-accredited certifier and
non-profit advocacy group, and the company has also received its Good Manufacturing Practice (GMP) certification, confirming that its
offerings follow regulations promulgated by the US Food and Drug Administration and are safe, pure, and effective. In addition, Vertosa
is expanding into other legal states, and this paves the way for Resonate to follow behind moving beyond California while still assuring
strict standards and high production quality for Koan products.



Manufacturing:



The
Company partnered with The Galley, a California licensed Type N – Infused Products Manufacturer based in Santa Rosa, California.
The Galley produces and packages premium award-winning products and has worked with some of the most popular brands in the industry.
The Galley is built to FDA and CDPH standards and is focused on high demand areas of production – Edibles, Topicals, Tinctures,
Chocolate, Hard Candies, Gummies, Pre-Rolls, Flower, Vapes and Beverages. Resonate Blends was granted a Type S: Shared Facility - Adult
and Medicinal Cannabis Manufacturing License on July 23, 2021. The license allows Resonate Blends to manufacture cannabis products at
the licensed facility of The Galley.



Resonate
and The Galley entered into a Master Services Agreement in which The Galley will manufacture and package Resonate’s first family
of products to precise specifications.



The
Galley and Resonate have been in frequent contact throughout Resonate’s development period and are now supporting the production
of the Company’s unique family of wellness lifestyle products. Resonate’s first of its kind offerings are emulsified through
the advanced infusion technology provided by award-winning Vertosa and collaboratively developed to push the state of the art in its
cannabis products.



Distribution:



Because
of the unique nature of Resonate’s Koan products and the recent expansion of home delivery services in the cannabis industry, Resonate
has prioritized a direct-to-consumer method as a key sales strategy. Resonate has identified a technology partner who will add an e-commerce
feature to the Koan web site that will allow the Company to sell products directly to consumers using a licensed California state-wide
delivery network for fulfilment.



In
addition to direct sales, the company plans to offer products to select premium dispensaries throughout California. These products will
be delivered to retail establishments by a leading cannabis full-service distributor. The Company contracted with The Vault 3PL to provide
logistics and state-wide distribution for Resonate’s Koan Cordials, its product line of unique experience blends currently available
in California.



Resonate
is also developing relationships with a variety of complementary distribution channels such as subscription box companies and other non-storefront
reseller organizations.



The
Company partnered with leading e-commerce technology provider Grassdoor in October to allow online sales of Koan Cordials throughout
California. The Grassdoor partnership powers same-day delivery service of Resonate’s six precision-calibrated formulas throughout
Northern and Southern California.



5







To
summarize, Resonate has signed and announced definitive agreements with various partners to execute on its overall business strategy.
Vertosa is expected to develop unique formulations through its advanced nano-emulsification process, The Galley is expected to assemble
and package, Grassdoor’s e-commerce solution is expected to offer online sales and home delivery in California of Cordials and
Vault 3PL Distribution to distribute the products. Resonate engaged with The Flower Agency to actively market social media channels to
the California market.



Marketing
and Sales Plan



The
cannabis industry is changing daily in response to updated regulations, customer product education, new interest from various demographics
and now the COVID-19 pandemic. As a result, we are constantly attentive to these changes as they affect the marketing of Koan products.
The initial marketing strategy was to launch in select dispensaries in Los Angeles and to support the launch with dispensary promotional
material and location-based marketing. However, in the current market the Company has decided to modify this strategy. Paradoxically,
retail restrictions and safety regulations were beneficial, as these allowed Resonate to reprioritize their sales approach and to build
a marketing plan around on-line dispensaries with wide delivery networks. Although retail restrictions will eventually be relaxed, the
Company doesn’t expect that storefront dispensaries will return to the dominant role they played in the cannabis industry before
COVID-19 for several reasons.



Dispensaries
are generally small, making social distancing difficult. Limitations on a customers’ ability to touch and smell products reduces
the value of in-person shopping. Restrictions on the number of people allowed in these small spaces will create waiting lines outside
stores, which will be inconvenient and even embarrassing for some. Finally, a significant number of customers, particularly in targeted
demographics, prefer the privacy and convenience of having products delivered to their homes. For all these reasons, Resonate has decided
to focus sales efforts on select high-end retail dispensaries and on-line, delivery and e-commerce outlets.



In
response to the sudden change in customer buying preferences, Resonate has implemented a plan to sell directly to consumers, by partnering
with an on-line platform which will allows them to communicate the value of their products directly to consumers. This platform will
connect consumers to a licensed retail and California-wide home delivery network. This direct-to-consumer approach has significant benefits
for us. First, it allows Resonate to control brand messaging and to assure that we can provide the information and education customers
need to make confident and informed product choices. Through this method, they have access to customer information, which is not available
from dispensaries, which allows them to employ successful marketing techniques used by leading on-line retailers such as customer loyalty
programs, memberships, ambassadors, etc., to build brand awareness and increase sales. It is also better for them financially as it increases
profit margin.



Therefore,
the marketing budget and energy is now being channeled into appropriate programmatic advertising, developing informational materials
for customers on the website, and developing professional and effective social media, search engine optimization and direct to consumer
marketing campaigns. We also offer market support to select premium California dispensaries both in person and thorough the Leaf.VIP
budtender training program. The Company expects that building its brand online will complement retail sales by increasing customer awareness
and creating “pull-through” at brick-and-mortar facilities.



Resonate
is currently recruiting two internal sales managers to oversee all sales efforts in Northern and Southern California. The Company is planning an in-house sales strategy for early Q1 2022 to maximize both the dispensary outreach and budtender education
– and to increase Direct-to-Consumer (D2C) sales platform activity. While wellness dispensaries will be a focus for the Company,
the customer acquisition focus will be heavily tilted towards the D2C portal starting in 2022.



Multi-state
expansion through licensing arrangements with the Cordials is also being planned. Several retailers in multiple states have reached out
to Resonate requesting the Cordials to be stocked in their dispensaries. The Company is currently evaluating where and when to open
new states outside of California.



6







Acquisition
of Assets



On
September 9, 2021, we entered into a binding letter of intent with L & G USA Inc., a Delaware corporation and L & G Canada Inc.,
an Ontario corporation (together “Seller”), and the stockholders of Seller, pursuant to which the Company planned to acquire
substantially all of the assets from Seller associated with the Lemon & Grass business and the Koan business (the “Acquisition”).



On
October 27, 2021, the Company terminated the agreement and the Acquisition. The Company is still in discussions with Seller, and the
Company may or may not go through with a transaction with Seller, but if the Company does, the terms will change from the previous agreement.



Current
Products



Resonate’s
first commercial release was a family of six precisely targeted effect blends. These products are category-breaking offerings as they
are neither tinctures nor beverages but have the benefits of both. They are emulsified, water soluble, single-serving blends that can
be enjoyed privately or shared socially. Resonate offers these across California in stylish mini bottles, each containing a single serving.
They can be sipped directly from the bottle or poured into beverages. Koan products offer the very high bioavailability of tinctures
not possible to deliver with edibles, take effect generally within minutes and provide benefits for approximately 3 hours. Significantly,
these formulas all provide a pleasant predictable experience, a gentle onset and exit and have no unpleasant sensations or aftereffects
sometimes associated with cannabis products. The current products are as follows:



Calm



CBD
rich with a hint of THC, Calm is formulated to quiet your mind and ease you into a gentle sense of wellbeing.



Wonder



Our
highest THC offering, Wonder is carefully crafted to bring back that youthful sense of wonder and awe we feel when we are fully engaged
with our senses and environment.



Balance



Balance
is a subtle combination of cannabinoids and terpenes formulated to bring your mind, body and spirit back to an even state of harmony
and homeostasis.



Create



Create
is formulated to stimulate your senses, spark your imagination and channel your inner muse. Led by a stimulative blend of terpenes and
just the right amount of THC to inspire and facilitate the artist in you.



Play



We
formulated Play to help you become fully immersed in the moment and the people around you. From the park to the beach to the dance floor,
Play helps you find your groove and keep it going.



Delight



Put
on your rose-colored glasses and give everything some extra sparkle with Delight. Designed to open up your senses, raise your spirits
and brighten your day.



7







Future
Products - Resonate Growth Plans



For
the first 12-18 months, Resonate concentrated on releasing product and brand building in California, and possibly new state expansion
if the proper opportunities exist. Resonate is following the launch of its first six Koan products with others based on The Resonate
System at regular intervals, and they plan to release their “Love” in Q1 2022 and “Sleep” Cordials in Q2. The
formulas, combined with the proprietary Vertosa technology, will allow the Company to quickly deliver controlled, predictable, enjoyable
effects in beverages, teas, and gummies. Vertosa is the leading provider of emulsification technology for cannabis manufacturers. Emulsification
allows cannabinoids to become water-soluble so that they can be added to Cordials, beverages, gummies, etc. Vertosa and Resonate are
engaged in joint research focusing on effects of various emulsification methods on cannabinoids. Resonate is working on methods that
improve user experience by refining effects and managing bioavailability. Vertosa will also be providing the emulsification required
for formulas in Resonate’s product line.



The
cannabis industry is in its infancy. Resonate’s growth strategy is to create an innovative ecosystem of companies, investments
and research that all support The Resonate System and its mission of empowering the wellness market. In addition to creating “house”
brands, the Company is also looking for other quality brands which could be incubated or targeted as either strategic partners or as
acquisitions. Integrating these companies should provide consistent product quality that yields expected results and that also allows
scalability to make a successful company overall. The Company is actively seeking potential acquisition roll-ups into the holding company
that could offer product synergies, new product development and shared resources in critical areas of the Company.



Intellectual
Property



Intellectual
Property (“IP”) development and protection continues as a core area of value creation for Resonate. The Company has developed
the world’s first Cannabis Cordial. The Koan Cordials combine THC (psychoactive), CBD (non-psychoactive) with botanical terpenes
to deliver an all-natural, plant-derived, single-dosed experience that can be enjoyed straight out of the bottle or poured into any beverage.
These multi-use products deliver specific, predictable, reliable, effects in a format that is completely unique in the industry.



The
Company believes the greatest long-term value creation in the Cannabis industry will be in the establishment of high-quality value-added
consumer brands that deliver the expected experience. As cultivation, supplies and services become quickly commoditized, value-added
brands represent the best opportunity for Resonate and its shareholders to support and benefit from the growth expected in the Cannabis
industry. It is therefore critical for Resonate to protect its methods, formulations and packaging.



On
June 14, 2021, the Company successfully filed a Provisional Patent Application with the US Patent & Trademark Office (USPTO) entitled
“Cannabis Nano-Emulsions for Achieving a Reliable, Targeted, Specific and Repeatable User Experience.” The invention relates
to methods and formulations including a combination of cannabinoids and terpenes calculated and specifically formulated to achieve a
targeted, specific and repeatable user experience. The Company is also filing for patent protection on its unique product packaging and
anticipates filing for other protections on new product development.



Competitive
Landscape



The
cannabis market still primarily consists of products of varying quality and poor branding. Much of the branding is heavy “stoner”
or hospital medicinal, and differentiation between products is difficult. As a result, finding a product with controllable, consistent
effects is difficult. Even products of high and reliable quality all look alike and have no shelf appeal. In addition, there is a mismatch
between the fastest growing demographic and many current product offerings, which are designed to be inhaled. This is exactly why Resonate
has developed Koan Cordials, tasty, single dose, healthy cannabis products with timeless, exceptional branding. As the market matures,
some companies are recognizing the importance of branding. Branded category leaders represent the 10 spots among best-selling products
and sales data supports the desire among consumers for branded products. This is further supported by Headset, data (the leading industry
provider of retail buying patterns), which shows that brands are leading every category in cannabis. Further, branded products command
higher prices. Some branded products generate pricing as high as 150%, over industry average. The Resonate team excels in product branding.



There
is no product in the marketplace exactly like Koan products at this time. Other companies offer tinctures (which are concentrated herbal
extracts made by soaking the bark, berries, leaves (dried or fresh), or roots from one or more plants in alcohol or vinegar), tea, salves,
patches and cosmetics and vapes, and some of them provide effects which may be similar to those the Koan products will provide, but few
are equal to Koan with respect to quality, efficacy, consistency and scope. Koan products are water soluble and can be enjoyed privately
or poured in beverages and shared socially. Resonate believes the total experience offered by Koan products cannot be found elsewhere
in the industry.



8







While
there are a number of very fine products in the premium cannabis space, there is not yet a dominant brand in any category. Some are leading
but no brand dominates. Data indicates that Resonate’s targeted demographic seeks out trusted brands when making product selections.
Resonate is bringing to market custom, reliable, experience-targeted products which can be sipped or shared; and offered under a well-crafted
brand supported by an accessible information system. The Company provides The Resonate System so customers can understand what to expect
and can make informed confident selections.



Employees



Currently,
there are six employees, comprised of 3 C-level executives and managers of brand, marketing and sales.



Item
1A. Risk Factors



Risk
Factors Associated with COVID-19



The
extent to which the coronavirus (“COVID-19”) outbreak impacts our business, results of operations and financial condition
will depend on future developments, which cannot be predicted.



The
COVID-19 pandemic has caused us to modify our business practices (including employee travel, employee work locations, and cancellation
of physical participation in meetings, events and conferences), and we may take further actions as may be required by government authorities
or that we determine are in the best interests of our employees, customers and business partners. There is no certainty that such measures
will be sufficient to mitigate the risks posed by the virus or otherwise be satisfactory to government authorities.



The
extent to which COVID-19 impacts our business, results of operations and financial condition will depend on future developments, which
are uncertain and cannot be predicted, including, but not limited to:



| | ● | the
    duration and scope of the pandemic;                                                                                                                                   
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | ● | governmental,
    business and individual actions taken in response to the pandemic and the impact of those actions on global economic activity;                              
| | ● | the
    actions taken in response to economic disruption;                                                                                                                     
| | ● | the
    impact of business disruptions;                                                                                                                                       
| | ● | the
    increase in business failures that we may utilize as industry partners and the customers we serve;                                                                    
| | ● | uncertainty
    as to the impact or staff availability during and post the pandemic; and                                                                                      
| | ● | our
    ability to provide our services, including as a result of our employees or our customers and suppliers working remotely and/or closures
    of offices and facilities.



Even
after the coronavirus outbreak has subsided, we may continue to experience materially adverse impacts to our business as a result of
its global economic impact, including any recession that has occurred or may occur in the future.



Risk
Factors Associated with the Cannabis Industry



Marijuana
remains illegal under United States federal law.



Marijuana
is a Schedule-I controlled substance under the Controlled Substances Act and is illegal under federal law. It remains illegal under United
States federal law to grow, cultivate, sell or possess marijuana for any purpose or to assist or conspire with those who do so. Additionally,
21 U.S.C. 856 makes it illegal to “knowingly open, lease, rent, use, or maintain any place, whether permanently or temporarily,
for the purpose of manufacturing, distributing, or using any controlled substance.” Even in those states in which the use of marijuana
has been authorized, its use remains a violation of federal law. Since federal law criminalizing the use of marijuana is not pre-empted
by state laws that legalize its use, strict enforcement of federal law regarding marijuana would likely result in the Company’s
clients’ inability to proceed with their operations, which would adversely affect demands for the Company’s products.



9







The
Company’s operations are subject to various laws, regulations and guidelines relating to the manufacture, management, transportation,
storage and disposal of cannabis but also including laws and regulations relating to health and safety, the conduct of operations and
the protection of the environment.



The
Company both directly and indirectly engages in the medical and adult-use cannabis industry in the United States where local state law
permits such activities. Investors are cautioned that in the United States, cannabis is largely regulated at the state level. To the
Company’s knowledge, there are to date a total of 38 states, and the District of Columbia, that have now legalized cannabis
in some form, including California, Nevada, New York, Florida, Illinois and Arizona. Notwithstanding the permissive regulatory environment
of cannabis at the state level, cannabis continues to be categorized as a controlled substance under the CSA and as such, cultivation,
distribution, sale and possession of cannabis violates federal law in the United States. The inconsistency between federal and state
laws and regulations is a major risk factor and there can be no assurance that the federal government will not seek to prosecute cases
involving cannabis businesses that are otherwise compliant with state law. Violations of any federal laws and regulations could result
in significant fines, penalties, administrative sanctions, convictions or settlements arising from civil proceedings conducted by either
the federal government or private citizens, or criminal charges, including, but not limited to, disgorgement of profits, cessation of
business activities or divestiture. This could have a material adverse effect on the Company, including its reputation and ability to
conduct business, its holding (directly or indirectly) of medical and adult-use cannabis licenses in the United States, the listing of
its securities on applicable exchanges, its financial position, operating results, profitability or liquidity or the market price of
our Common Stock.



The
Company believes the cannabis industry is highly dependent upon consumer perception regarding the safety, efficacy and quality of the
cannabis produced. Consumer perception of the Company’s products can be significantly influenced by scientific research or findings,
regulatory investigations, litigation, media attention and other publicity regarding the consumption of cannabis products. There can
be no assurance that future scientific research, findings, regulatory proceedings, litigation, media attention or other research findings
or publicity will be favorable to the medical cannabis market or any product, or consistent with earlier publicity The Company and its
wholly owned subsidiaries face an inherent risk of exposure to product liability claims, regulatory action and litigation if its
products are alleged to have caused significant loss or injury. Greater access to medical cannabis, through home and designated growing
and illegal dispensaries, may decrease the number of patients registering with the Company and may cause registered patients to leave
the Company and grow for themselves. Any significant interruption or negative change in the availability or economics of the supply chain
for key inputs could materially impact the business, financial condition and operating results of the Company and if the Company is unable
to continually innovate and increase efficiencies, its ability to attract new customers may be adversely affected. The Company may become
party to litigation, mediation and/or arbitration from time to time in the ordinary course of business which could adversely affect its
business



The
Company expects to derive a substantial portion of its revenues from the cannabis industry in certain states of the United States, which
industry is illegal under United States federal law.



The
Company is directly involved (through its subsidiaries) in the cannabis industry in the United States where local state laws permit such
activities. The United States federal government regulates drugs through the Controlled Substances Act (21 U.S.C. § 811), which
places controlled substances, including cannabis, in a schedule. Cannabis is classified as a Schedule I drug. Under United States federal
law, a Schedule I drug or substance has a high potential for abuse, no accepted medical use in the United States, and a lack of accepted
safety for the use of the drug under medical supervision. The United States Food and Drug Administration has not approved marijuana as
a safe and effective drug for any indication.



In
the United States marijuana is largely regulated at the state level. State laws regulating cannabis are in direct conflict with the federal
Controlled Substances Act, which makes cannabis use and possession federally illegal. Although certain states authorize medical or recreational
cannabis production and distribution by licensed or registered entities, under U.S. federal law, the possession, use, cultivation, and
transfer of cannabis and any related drug paraphernalia is illegal and any such acts are criminal acts under federal law. The Supremacy
Clause of the United States Constitution establishes that the United States Constitution and federal laws made pursuant to it are paramount
and in case of conflict between federal and state law, the federal law shall apply.



10







On
January 4, 2018, U.S. Attorney General Jeff Sessions issued a memorandum to U.S. district attorneys which rescinded previous guidance
from the U.S. Department of Justice specific to cannabis enforcement in the United States. U.S. federal prosecutors have been given discretion
in determining whether to prosecute cannabis related violations of U.S. federal law. If the Department of Justice policy was to aggressively
pursue financiers or equity owners of cannabis-related business, and United States Attorneys followed such Department of Justice policies
through pursuing prosecutions, then the Company could face (i) seizure of its cash and other assets used to support or derived from its
cannabis subsidiaries, (ii) the arrest of its employees, directors, officers, managers and investors, and charges of ancillary criminal
violations of the CSA for aiding and abetting and conspiring to violate the CSA by virtue of providing financial support to cannabis
companies that service or provide goods to state-licensed or permitted cultivators, processors, distributors, and/or retailers of cannabis,
and/or (iii) barring employees, directors, officers, managers and investors who are not U.S. citizens from entry into the United States
for life. There is no guarantee that state laws legalizing and regulating the sale and use of cannabis will not be repealed or overturned,
or that local governmental authorities will not limit the applicability of state laws within their respective jurisdictions. Unless and
until the United States Congress amends the Controlled Substances Act with respect to medical and/or adult-use cannabis (and as to the
timing or scope of any such potential amendments there can be no assurance), there is a risk that federal authorities may enforce current
federal law. If the federal government begins to enforce federal laws relating to cannabis in states where the sale and use of cannabis
is currently legal, or if existing applicable state laws are repealed or curtailed, the Company’s business, results of operations,
financial condition and prospects would be materially adversely affected.



Possible
yet unanticipated changes in federal and state law could cause any products that we intend to launch, containing hemp-derived CBD oil
to be illegal, or could otherwise prohibit, limit or restrict any of our products containing CBD.



Until
2014, when 7 U.S. Code §5940 became federal law as part of the Agricultural Act of 2014 (the “2014 Farm Act”), products
containing oils derived from hemp, notwithstanding a minimal or non-existing THC content, were classified as Schedule I illegal drugs.
The 2014 Farm Act expired on September 30, 2018, and was thereafter replaced by the Agricultural Improvement Act of 2018 on December
20, 2018 (the “2018 Farm Act “), which amended various sections of the U.S. Code, thereby removing hemp, defined as cannabis
with less than 0.3% of THC, from Schedule 1 status under the Controlled Substances Act (“CSA”), and legalizing the cultivation
and sale of hemp at the federal level, subject to compliance with certain federal requirements and state law, amongst other things. THC
is the psychoactive component of plants in the cannabis family generally identified as marihuana or marijuana.



The
2018 Farm Bill also shifted regulatory authority from the Drug Enforcement Administration to the Department of Agriculture. The 2018
Farm Bill did not change the United States Food and Drug Administration’s (“FDA”) oversight authority over CBD products.
The 2018 Farm Act delegated the authority to the states to regulate and limit the production of hemp and hemp derived products within
their territories. Although many states have adopted laws and regulations that allow for the production and sale of hemp and hemp derived
products under certain circumstances, no assurance can be given that such state laws may not be repealed or amended such that our intended
products containing hemp-derived CBD would once again be deemed illegal under the laws of one or more states now permitting such products,
which in turn would render such intended products illegal in those states under federal law even if the federal law is unchanged. In
the event of either repeal of federal or of state laws and regulations, or of amendments thereto that are adverse to our intended medical
CBD products, we may be restricted or limited with respect to those products that we may sell or distribute, which could adversely impact
our intended business plan with respect to such intended products.



Additionally,
the FDA has indicated its view that certain types of products containing CBD may not be permissible under the United States Federal Food,
Drug and Cosmetic Act (“FDCA”). The FDA’s position is related to its approval of Epidiolex, a marijuana-derived prescription
medicine to be available in the United States. The active ingredient in Epidiolex is CBD. On December 20, 2018, after the passage of
the 2018 Farm Bill, FDA Commissioner Scott Gottlieb issued a statement in which he reiterated the FDA’s position that, among other
things, the FDA requires a cannabis product (hemp-derived or otherwise) that is marketed with a claim of therapeutic benefit, or with
any other disease claim, to be approved by the FDA for its intended use before it may be introduced into interstate commerce and that
the FDCA prohibits introducing into interstate commerce food products containing added CBD, and marketing products containing CBD as
a dietary supplement, regardless of whether the substances are hemp-derived. Although we believe our existing and planned CBD product
offerings comply with applicable federal and state laws and regulations, legal proceedings alleging violations of such laws could have
a material adverse effect on our business, financial condition and results of operations.



11







FDA
regulation could negatively affect the hemp industry, which would directly affect our financial condition.



The
FDA may seek expanded regulation of hemp under the FDCA. Additionally, the FDA may issue rules and regulations, including certified good
manufacturing practices, or cGMPs, related to the growth, cultivation, harvesting and processing of hemp. Clinical trials may be needed
to verify efficacy and safety. It is also possible that the FDA would require that facilities where hemp is grown register with the FDA
and comply with certain federally prescribed regulations. In the event that some or all of these regulations are imposed, we do not know
what the impact would be on the hemp industry, including what costs, requirements and possible prohibitions may be enforced. If we or
our partners are unable to comply with the regulations or registration as prescribed by the FDA, we and or our partners (including C2M)
may be unable to continue to operate their and our business in its current or planned form or at all.



Sources
of hemp-derived CBD depend upon legality of cultivation, processing, marketing and sales of products derived from those plants under
state law of the United States.



Hemp-derived
CBD can only be legally produced in states that have laws and regulations that allow for such production and that comply with the 2018
Farm Act, apart from state laws legalizing and regulating medical and recreational cannabis or marijuana, which remains illegal under
federal law and regulations. In addition, as described in the preceding risk factor, in the event of repeal or amendment of laws and
regulations which are now favorable to the cannabis/hemp industry in such states, we would be required to locate new suppliers in states
with laws and regulations that qualify under the 2018 Farm Act. If we were to be unsuccessful in arranging new sources of supply of our
raw ingredients, or if our raw ingredients were to become legally unavailable, our intended business plan with respect to such products
could be adversely impacted.



Because
our distributors may only sell and ship our products containing hemp-derived CBD in states that have adopted laws and regulations qualifying
under the 2018 Farm Act, a reduction in the number of states having such qualifying laws and regulations could limit, restrict or otherwise
preclude the sale of intended products containing hemp-derived CBD.



The
interstate shipment of hemp-derived CBD from one state to another is legal only where both states have laws and regulations that allow
for the production and sale of such products and that qualify under the 2018 Farm Act. Therefore, the marketing and sale of our intended
products containing hemp-derived CBD is limited by such factors and is restricted to such states. Although we believe we may lawfully
sell any of our finished products, including those containing CBD, in a majority of states, a repeal or adverse amendment of laws and
regulations that are now favorable to the distribution, marketing and sale of finished products we intend to sell could significantly
limit, restrict or prevent us from generating revenue related to our products that contain hemp-derived CBD. Any such repeal or adverse
amendment of now favorable laws and regulations could have an adverse impact on our business plan with respect to such products.



Due
to recent expansion into the Cannabis industry, we may have a difficult time obtaining the various insurances that are desired to operate
our business, which may expose us to additional risk and financial liability.



Insurance
that is otherwise readily available, such as general liability, and directors and officer’s insurance, may become more difficult
for us to find, and more expensive, due to our intended launch of certain products containing Cannabis. There are no guarantees that
we will be able to find such insurances in the future, or that the cost will be affordable to us. If we are forced to go without such
insurances, it may prevent us from entering into certain business sectors, may inhibit our growth, and may expose us to additional risk
and financial liabilities.



Our
products may not meet health and safety standards or could become contaminated.



We
have adopted various quality, environmental, health and safety standards. We do not have control over all of the third parties involved
in the manufacturing of our products and their compliance with government health and safety standards. Even if our products meet these
standards, they could otherwise become contaminated. A failure to meet these standards or contamination could occur in our operations
or those of our manufacturers, distributors or suppliers. This could result in expensive production interruptions, recalls and liability
claims. Moreover, negative publicity could be generated from false, unfounded or nominal liability claims or limited recalls. Any of
these failures or occurrences could negatively affect our business and financial performance.



12







The
sale of our products involves product liability and related risks that could expose us to significant insurance and loss expenses.



We
face an inherent risk of exposure to product liability claims if the use of our products results in, or is believed to have resulted
in, illness or injury. Our products contain combinations of ingredients, and there is little long-term experience with the effect of
these combinations. In addition, interactions of these products with other products, prescription medicines and over-the-counter drugs
have not been fully explored or understood and may have unintended consequences. While our third-party manufacturers perform tests in
connection with the formulations of our products, these tests are not designed to evaluate the inherent safety of our products.



Any
product liability claim may increase our costs and adversely affect our revenue and operating income. Moreover, liability claims arising
from a serious adverse event may increase our costs through higher insurance premiums and deductibles and may make it more difficult
to secure adequate insurance coverage in the future. In addition, our product liability insurance may fail to cover future product liability
claims, which, if adversely determined, could subject us to substantial monetary damages.



Confusion
between legal Cannabis and illegal Cannabis.



There
is risk that confusion or uncertainty surrounding our products with regulated cannabis could occur on the state or federal level and
impact us. We may have difficulty with establishing banking relationships, working with investment banks and brokers who would be willing
to offer and sell our securities or accept deposits from shareholders, and auditors willing to certify our financial statements if we
are confused with businesses that are in the cannabis business. Any of these additional factors, should they occur, could also affect
our business, prospects, assets or results of operation could have a material adverse effect on the business, prospects, results of operations
or financial condition of the Company.



There
exists U.S. state regulatory uncertainty.



The
rulemaking process for cannabis operators at the state level in any state will be ongoing and result in frequent changes. As a result,
a compliance program is essential to manage regulatory risk. All operating policies and procedures implemented in the operation will
be compliance-based and derived from the state regulatory structure governing ancillary cannabis businesses and their relationships to
state-licensed or permitted cannabis operators, if any. Notwithstanding the Company’s efforts, regulatory compliance and the process
of obtaining regulatory approvals can be costly and time-consuming. No assurance can be given that the Company will receive the requisite
licenses, permits or cards to operate its businesses.



In
addition, local laws and ordinances could restrict the Company’s business activity. Although legal under the laws of the states
in which the Company’s business will operate, local governments have the ability to limit, restrict, and ban cannabis businesses
from operating within their jurisdiction. Land use, zoning, local ordinances, and similar laws could be adopted or changed, and have
a material adverse effect on the Company’s business.



The
Company is aware that multiple states are considering special taxes or fees on businesses in the marijuana industry. It is a potential
yet unknown risk at this time that other states are in the process of reviewing such additional fees and taxation. This could have a
material adverse effect upon the Company’s business, results of operations, financial condition or prospects.



13







There
is no assurance that the Company will obtain and retain any relevant licenses.



State
licenses in the U.S. are subject to ongoing compliance and reporting requirements. Failure by the Company to comply with the requirements
of licenses or any failure to maintain licenses would have a material adverse impact on the business, financial condition and operating
results of the Company. Should any state in which the Company considers a license important not grant, extend or renew such license or
should it renew such license on different terms, or should it decide to grant more than the anticipated number of licenses, the business,
financial condition and results of the operation of the Company could be materially adversely affected. The cannabis laws and regulations
of states in which we operate limit the granting and number of licenses granted for dispensaries and cultivation and production facilities.
The number of licenses by category, and issuance of individual licenses, may be limited, delayed, denied or otherwise unissued. This
separate treatment of individual licenses as well as license categories, along with limits set on the number of licenses granted in each
of these operating categories, can result in market and supply chain risks including, for example, mismatch between cultivation and production
facilities and dispensaries relating to availability and production of cannabis products. This can result in, among other things, market,
pricing and supply risks, which may have a material effect on the Company’s business, financial condition and operations.



The
Company is subject to restricted access to banking.



Because
the manufacture, distribution, and dispensation of cannabis remains illegal under the CSA, banks and other financial institutions providing
services to cannabis-related businesses risk violation of federal anti-money laundering statutes (18 U.S.C. §§ 1956 and 1957),
the unlicensed money-remitter statute (18 U.S.C. § 1960) and the U.S. Bank Secrecy Act. These statutes can impose criminal liability
for engaging in certain financial and monetary transactions with the proceeds of a “specified unlawful activity” such as
distributing controlled substances which are illegal under federal law, including cannabis, and for failing to identify or report financial
transactions that involve the proceeds of cannabis-related violations of the CSA.



In
February 2014, the Financial Crimes Enforcement Network (“FinCEN”) bureau of the U.S. Treasury Department issued guidance
(which is not law) with respect to financial institutions providing banking services to cannabis business, including burdensome due diligence
expectations and reporting requirements. This guidance does not provide any safe harbors or legal defenses from examination or regulatory
or criminal enforcement actions by the Department of Justice, FinCEN or other federal regulators. Thus, most banks and other financial
institutions in the United States do not appear to be comfortable providing banking services to cannabis-related businesses, or relying
on this guidance, which can be amended or revoked at any time by the Trump Administration. In addition to the foregoing, banks may refuse
to process debit card payments and credit card companies generally refuse to process credit card payments for cannabis-related businesses.
As a result, the Company may have limited or no access to banking or other financial services in the United States. In addition, federal
money laundering statutes and Bank Secrecy Act regulations discourage financial institutions from working with any organization that
sells a controlled substance, regardless of whether the state it resides in permits cannabis sales. The inability or limitation in the
Company’s ability to open or maintain bank accounts, obtain other banking services and/or accept credit card and debit card payments
may make it difficult for the Company to operate and conduct its business as planned or to operate efficiently.



On
March 18, 2021, the Secure and Fair Enforcement Banking Act (the “SAFE Banking Act”) was reintroduced in the House of Representatives.
On March 23, 2021, the bill was reintroduced in the Senate as well. The House previously passed the SAFE Banking Act in September 2019,
but the measure stalled in the Senate. Most recently, on February 4, 2022, the House approved the America COMPETES Act of 2022, which
includes the provisions of the SAFE Banking Act. The America COMPETES Act now advances to the Senate for consideration. As written, the
SAFE Banking Act would allow financial institutions to provide their services to state-legal cannabis clients and ancillary businesses
serving state-legal cannabis businesses without fear of federal sanctions. There is no guarantee the SAFE Banking Act will become law
in its current form, if at all.



The
Company is subject to constraints on marketing products.



The
development of the Company’s business and operating results may be hindered by applicable restrictions on sales and marketing activities
imposed by government regulatory bodies. The regulatory environment in the United States limits the Company’s ability to compete
for market share in a manner similar to other industries. If the Company is unable to effectively market its products and compete for
market share, or if the costs of compliance with government legislation and regulation cannot be absorbed through increased selling prices
for its products, the Company’s sales and operating results could be adversely affected.



14







The
Company is subject to unfavorable tax treatment of cannabis businesses.



Under
Section 280E (“Section 280E”) of the United States Internal Revenue Code of 1986, as amended (the “U.S. Tax Code”),
“no deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business
if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances
(within the meaning of schedule I and II of the Controlled Substances Act) which is prohibited by Federal law or the law of any State
in which such trade or business is conducted.” This provision has been applied by the U.S. Internal Revenue Service to cannabis
operations, prohibiting them from deducting expenses directly associated with the sale of cannabis. Section 280E therefore has a significant
impact on the retail side of cannabis, but a lesser impact on cultivation and manufacturing operations. A result of Section 280E is that
an otherwise profitable business may, in fact, operate at a loss, after taking into account its U.S. income tax expenses.



The
Company is subject to a risk of civil asset forfeiture.



Because
the cannabis industry remains illegal under U.S. federal law, any property owned by participants in the cannabis industry which are either
used in the course of conducting such business, or are the proceeds of such business, could be subject to seizure by law enforcement
and subsequent civil asset forfeiture. Even if the owner of the property were never charged with a crime, the property in question could
still be seized and subject to an administrative proceeding by which, with minimal due process, it could be subject to forfeiture.



The
Company is subject to proceeds of crime statutes.



The
Company will be subject to a variety of laws and regulations domestically and in the United States that involve money laundering, financial
recordkeeping and proceeds of crime, including the Currency and Foreign Transactions Reporting Act of 1970 (commonly known as the Bank
Secrecy Act), as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (USA PATRIOT Act), as amended and the rules and regulations thereunder and any related or similar rules,
regulations or guidelines, issued, administered or enforced by governmental authorities in the United States



In
the event that any of the Company’s license agreements, or any proceeds thereof, in the United States were found to be in violation
of money laundering legislation or otherwise, such transactions may be viewed as proceeds of crime under one or more of the statutes
noted above or any other applicable legislation. This could be materially adverse to the Company and, among other things, could restrict
or otherwise jeopardize the ability of the Company to declare or pay dividends.



The
Company is subject to product liability.



The
Company faces an inherent risk of exposure to product liability claims, regulatory action and litigation if its products are alleged
to have caused significant loss or injury. In addition, the sale of the Company’s products would involve the risk of injury to
consumers due to tampering by unauthorized third parties or product contamination. Previously unknown adverse reactions resulting from
human consumption of the Company’s products alone or in combination with other medications or substances could occur. The Company
may be subject to various product liability claims, including, among others, that the Company’s products caused injury or illness
or death, include inadequate instructions for use or include inadequate warnings concerning possible side effects or interactions with
other substances. A product liability claim or regulatory action against the Company could result in increased costs, could adversely
affect the Company’s reputation with its clients and consumers generally, and could have a material adverse effect on the business,
results of operations and financial condition of the Company. There can be no assurances that the Company will be able to obtain or maintain
product liability insurance on acceptable terms or with adequate coverage against potential liabilities. Such insurance is expensive
and may not be available in the future on acceptable terms, or at all. The inability to obtain sufficient insurance coverage on reasonable
terms or to otherwise protect against potential product liability claims could prevent or inhibit the commercialization of the Company’s
potential products.



15







The
Company is subject to product recalls.



Manufacturers
and distributors of products are sometimes subject to the recall or return of their products for a variety of reasons, including product
defects, such as contamination, unintended harmful side effects or interactions with other substances, packaging safety and inadequate
or inaccurate labeling disclosure. If any of the Company’s products are recalled due to an alleged product defect or for any other
reason, the Company could be required to incur the unexpected expense of the recall and any legal proceedings that might arise in connection
with the recall. The Company may lose a significant amount of sales and may not be able to replace those sales at an acceptable margin
or at all. In addition, a product recall may require significant management attention. Although the Company has detailed procedures in
place for testing its products, there can be no assurance that any quality, potency or contamination problems will be detected in time
to avoid unforeseen product recalls, regulatory action or lawsuits. Additionally, if one of the Company’s significant brands were
subject to recall, the image of that brand and the Company could be harmed. A recall for any of the foregoing reasons could lead to decreased
demand for the Company’s products and could have a material adverse effect on the results of operations and financial condition
of the Company. Additionally, product recalls may lead to increased scrutiny of the Company’s operations by the U.S. Food and Drug
Administration, or other regulatory agencies, requiring further management attention and potential legal fees and other expenses.



Controlled
substance legislation differs between countries and legislation in certain countries may restrict or limit our ability to sell hemp-based
consumer products.



Most
countries are parties to the Single Convention on Narcotic Drugs 1961, which governs international trade and domestic control of narcotic
substances, including cannabis extracts. Countries may interpret and implement their treaty obligations in a way that creates a legal
obstacle to our obtaining regulatory approval for our hemp-based consumer products in those countries. These countries may not be willing
or able to amend or otherwise modify their laws and regulations to permit our hemp-based consumer products to be marketed or achieving
such amendments to the laws and regulations may take a prolonged period of time. In the case of countries with similar obstacles, we
would be unable to market our hemp-based consumer products in countries in the near future or perhaps at all if the laws and regulations
in those countries do not change.



Owners
of properties located in close proximity to our properties may assert claims against us regarding the use of the property as a marijuana
dispensary or marijuana cultivation and processing facility, which if successful, could materially and adversely affect our business.



Owners
of properties located in close proximity to our properties may assert claims against us regarding the use of our properties, including
assertions that the use of the property constitutes a nuisance that diminishes the market value of such owner’s nearby property.
Such property owners may also attempt to assert such a claim in federal court as a civil matter under the Racketeer Influenced and Corrupt
Organizations Act. If a property owner were to assert such a claim against us, we may be required to devote significant resources and
costs to defending ourselves against such a claim, and if a property owner were to be successful on such a claim, our tenants may be
unable to continue to operate their business in its current form at the property, which could materially adversely impact the tenant’s
business and the value of our property, our business and financial results and the trading price of our securities.



Laws
and regulations affecting the regulated cannabis and marijuana industry are constantly changing, which could materially adversely affect
our operations, and we cannot predict the impact that future regulations may have on us.



Local,
state and federal marijuana laws and regulations are broad in scope and subject to evolving interpretations, which could require us to
incur substantial costs associated with compliance or alter our business plan. In addition, violations of these laws, or allegations
of such violations, could disrupt our business and result in a material adverse effect on its operations. In addition, it is possible
that regulations may be enacted in the future that will be directly applicable to our proposed business. We cannot predict the nature
of any future laws, regulations, interpretations or applications, nor can we determine what effect additional governmental regulations
or administrative policies and procedures, when and if promulgated, could have on our business.



16







Risks
Relating to Our Securities



If
a market for our common stock does not develop, shareholders may be unable to sell their shares.



Our
common stock is quoted under the symbol “KOAN” on the OTCQB. We do not currently have a consistent active trading market.
There can be no assurance that a consistent active and liquid trading market will develop or, if developed, that it will be sustained.



Our
securities are thinly traded. Accordingly, it may be difficult to sell shares of our common stock without significantly depressing the
value of the stock. Unless we are successful in developing continued investor interest in our stock, sales of our stock could continue
to result in major fluctuations in the price of the stock.



The
price of our common stock is volatile, which may cause investment losses for our stockholders.



The
market price of our common stock has been and is likely in the future to be volatile. Our common stock price may fluctuate in response
to factors such as:



| | ● | Announcements
    by us regarding liquidity, significant acquisitions, equity investments and divestitures, strategic relationships, addition or loss
    of significant customers and contracts, capital expenditure commitments and litigation;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                  
| | ● | Issuance
    of convertible or equity securities and related warrants for general or merger and acquisition purposes;                                                                                                                            
| |   |                                                                                                                                                                                                                                                  
| | ● | Issuance
    or repayment of debt, accounts payable or convertible debt for general or merger and acquisition purposes;                                                                                                                          
| |   |                                                                                                                                                                                                                                                  
| | ● | Sale
    of a significant number of shares of our common stock by stockholders;                                                                                                                                                                  
| |   |                                                                                                                                                                                                                                                  
| | ● | General
    market and economic conditions;                                                                                                                                                                                                      
| |   |                                                                                                                                                                                                                                                  
| | ● | Quarterly
    variations in our operating results;                                                                                                                                                                                               
| |   |                                                                                                                                                                                                                                                  
| | ● | Investor
    and public relation activities;                                                                                                                                                                                                     
| |   |                                                                                                                                                                                                                                                  
| | ● | Announcements
    of technological innovations;                                                                                                                                                                                                  
| |   |                                                                                                                                                                                                                                                  
| | ● | New
    product introductions by us or our competitors;                                                                                                                                                                                          
| |   |                                                                                                                                                                                                                                                  
| | ● | Competitive
    activities; and                                                                                                                                                                                                                  
| |   |                                                                                                                                                                                                                                                  
| | ● | Additions
    or departures of key personnel.                                                                                                                                                                                                    



These
broad market and industry factors may have a material adverse effect on the market price of our common stock, regardless of our actual
operating performance. These factors could have a material adverse effect on our business, financial condition and results of operations.



Transfers
of our securities may be restricted by virtue of state securities “blue sky” laws, which prohibit trading absent compliance
with individual state laws. These restrictions may make it difficult or impossible to sell shares in those states. Without cannabis banking
laws in place, the ability to clear restricted stock is difficult.



Transfers
of our common stock may be restricted under the securities or securities regulations laws promulgated by various states and foreign jurisdictions,
commonly referred to as “blue sky” laws. Absent compliance with such individual state laws, our common stock may not be traded
in such jurisdictions. Because the securities held by many of our stockholders have not been registered for resale under the blue sky
laws of any state, the holders of such shares and persons who desire to purchase them should be aware that there may be significant state
blue sky law restrictions upon the ability of investors to sell the securities and of purchasers to purchase the securities. These restrictions
may prohibit the secondary trading of our common stock. Investors should consider the secondary market for our securities to be a limited
one. The restricted access to cannabis banking makes it more difficult for cannabis investors to clear their stock from a Transfer Agent
(“TA”) to their brokerage of choice. We can provide no assurances to investors of our stock that they will have the ability
to move their restricted stock from the TA to their brokerage until federal banking laws are enacted.



17







The
sale of a significant number of our shares of common stock could depress the price of our common stock.



Sales
or issuances of a large number of shares of common stock in the public market or the perception that sales may occur could cause the
market price of our common stock to decline. Significant shares of common stock are held by our principal stockholders, other company
insiders and other large stockholders. As “affiliates” of Resonate, as defined under Securities and Exchange Commission Rule
144 under the Securities Act of 1933, our principal stockholders, other of our insiders and other large stockholders may only sell their
shares of common stock in the public market pursuant to an effective registration statement or in compliance with Rule 144.



Future
issuance of additional shares of common stock and/or preferred stock could dilute existing stockholders. We have and may issue preferred
stock that could have rights that are preferential to the rights of common stock that could discourage potentially beneficially transactions
to our common stockholders.



Pursuant
to our Articles of Incorporation, we currently have authorized 200,000,000 shares of common stock and 10,000,000 shares of preferred
stock. To the extent that common shares are available for issuance, subject to compliance with applicable stock exchange listing rules,
our board of directors has the ability to issue additional shares of common stock in the future for such consideration as the board of
directors may consider sufficient. The issuance of any additional securities could, among other things, result in substantial dilution
of the percentage ownership of our stockholders at the time of issuance, result in substantial dilution of our earnings per share and
adversely affect the prevailing market price for our common stock.



An
issuance of additional shares of preferred stock could result in a class of outstanding securities that would have preferences with respect
to voting rights and dividends and in liquidation over our common stock and could, upon conversion or otherwise, have all of the rights
of our common stock. Our Board of Directors’ authority to issue preferred stock could discourage potential takeover attempts or
could delay or prevent a change in control through merger, tender offer, proxy contest or otherwise by making these attempts more difficult
or costly to achieve. The issuance of preferred stock could impair the voting, dividend and liquidation rights of common stockholders
without their approval.



Future
capital raises may dilute our existing stockholders’ ownership and/or have other adverse effects on our operations.



If
we raise additional capital by issuing equity securities, our existing stockholders’ percentage ownership will be reduced, and
these stockholders may experience substantial dilution. We may also issue equity securities that provide for rights, preferences and
privileges senior to those of our common stock. If we raise additional funds by issuing debt securities, these debt securities would
have rights senior to those of our common stock and the terms of the debt securities issued could impose significant restrictions on
our operations, including liens on our assets. If we raise additional funds through collaborations and licensing arrangements, we may
be required to relinquish some rights to our technologies or candidate products, or to grant licenses on terms that are not favorable
to us.



We
do not anticipate paying any cash dividends on our capital stock in the foreseeable future.



We
have never declared or paid cash dividends on our capital stock. We currently intend to retain all of our future earnings, if any, to
finance the growth and development of our business, and we do not anticipate paying any cash dividends on our capital stock in the foreseeable
future. In addition, the terms of any future debt agreements may preclude us from paying dividends. As a result, capital appreciation,
if any, of our common stock will be your sole source of gain for the foreseeable future.



18







Anti-takeover
provisions may limit the ability of another party to acquire our company, which could cause our stock price to decline.



Our
Articles of Incorporation, as amended, our bylaws and Nevada law contain provisions that could discourage, delay or prevent a third party
from acquiring our company, even if doing so may be beneficial to our stockholders. In addition, these provisions could limit the price
investors would be willing to pay in the future for shares of our common stock.



Our
Articles of Incorporation allow for our board to create new series of preferred stock without further approval by our stockholders, which
could adversely affect the rights of the holders of our common stock; our outstanding Preferred Stock contains provisions that restrict
our ability to take certain actions without the consent of a certain percentage of Preferred Stock then outstanding.



Our
Board of Directors has the authority to fix and determine the relative rights and preferences of preferred stock. Our Board of Directors
also has the authority to issue preferred stock without further stockholder approval. As a result, our Board of Directors could authorize
the issuance of a series of preferred stock that would grant to holders the preferred right to our assets upon liquidation, the right
to receive dividend payments before dividends are distributed to the holders of common stock and the right to the redemption of the shares,
together with a premium, prior to the redemption of our common stock. In addition, our Board of Directors could authorize the issuance
of a series of preferred stock that has greater voting power than our common stock or that is convertible into our common stock, which
could decrease the relative voting power of our common stock or result in dilution to our existing stockholders.



Provisions
in the Nevada Revised Statutes and our Bylaws could make it very difficult for an investor to bring any legal actions against our directors
or officers for violations of their fiduciary duties or could require us to pay any amounts incurred by our directors or officers in
any such actions.



Members
of our board of directors and our officers will have no liability for breaches of their fiduciary duty of care as a director or officer,
except in limited circumstances, pursuant to provisions in the Nevada Revised Statutes and our Bylaws as authorized by the Nevada Revised
Statutes. Specifically, Section 78.138 of the Nevada Revised Statutes provides that a director or officer is not individually liable
to the company or its shareholders or creditors for any damages as a result of any act or failure to act in his or her capacity as a
director or officer unless it is proven that (1) the director’s or officer’s act or failure to act constituted a breach of
his or her fiduciary duties as a director or officer and (2) his or her breach of those duties involved intentional misconduct, fraud
or a knowing violation of law. This provision is intended to afford directors and officers protection against and to limit their potential
liability for monetary damages resulting from suits alleging a breach of the duty of care by a director or officer. Accordingly, you
may be unable to prevail in a legal action against our directors or officers even if they have breached their fiduciary duty of care.
In addition, our Bylaws allow us to indemnify our directors and officers from and against any and all costs, charges and expenses resulting
from their acting in such capacities with us. This means that if you were able to enforce an action against our directors or officers,
in all likelihood, we would be required to pay any expenses they incurred in defending the lawsuit and any judgment or settlement they
otherwise would be required to pay. Accordingly, our indemnification obligations could divert needed financial resources and may adversely
affect our business, financial condition, results of operations and cash flows, and adversely affect prevailing market prices for our
common stock.



Item
1B. Unresolved Staff comments



None



Item
2. Properties



Currently,
we do not own any real estate. Our principal executive offices are located at 26565 Agoura Road, Suite 200, Calabasas, CA 91302. We pay
rent of $99.00 per month at this location. We believe that our properties are adequate for our current needs, but growth potential may
require larger facilities due to anticipated addition of personnel. We do not have any policies regarding investments in real estate,
securities or other forms of property.



Item
3. Legal Proceedings



We
have no current legal proceedings.



Item
4. Mine Safety Disclosures



Not
applicable.



19







PART
II



Item
5. Market for Registrant’s Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities



Market
Information



Our
common stock is traded under the symbol “KOAN” on the OTCQB. Only a limited market exists for our securities. There is no
assurance that a regular trading market will develop, or if developed, that it will be sustained. Therefore, a shareholder may be unable
to resell his securities in our company.



The
following tables set forth the range of high and low bid information for our common stock for the each of the periods indicated. These
quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.



Fiscal
Year Ending December 31, 2021



|Quarter Ended      |  | High $ |     |  | Low $ | 
|------------------ |  | ------ | --- |  | ----- | 
|March 31, 2021     |  |        | .93 |  |       | 
|June 30, 2021      |  |        | .67 |  |       | 
|September 30, 2021 |  |        | .49 |  |       | 
|December 31, 2021  |  |        | .42 |  |       | 



Fiscal
Year Ending December 31, 2020



|Quarter Ended      |  | High $ |     |  | Low $ | 
|------------------ |  | ------ | --- |  | ----- | 
|March 31, 2020     |  |        | .20 |  |       | 
|June 30, 2020      |  |        | .27 |  |       | 
|September 30, 2020 |  |        | .19 |  |       | 
|December 31, 2020  |  |        | .20 |  |       | 



On
April 14, 2022, the last sales price per share of our common stock was $.11



Holders
of Our Common Stock



As
of April 14, 2022, we had 47,796,859 shares of our common stock issued and outstanding, held by approximately 164 shareholders
of record at our transfer agent, with approximately 47 additional shareholders holding our shares in street name.



Dividends



We
currently intend to retain future earnings for the operation of our business. We have never declared or paid cash dividends on our common
stock, and we do not anticipate paying any cash dividends in the foreseeable future.



In
the event that a dividend is declared, common stockholders on the record date are entitled to share ratably in any dividends that may
be declared from time to time on the common stock by our board of directors from funds legally available.



There
are no restrictions in our articles of incorporation or bylaws that restrict us from declaring dividends. The Nevada Revised Statutes,
however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend:



| | 1. | We
    would not be able to pay our debts as they become due in the usual course of business; or
| | -- | ------------------------------------------------------------------------------------------------



20







| | 2. | Our
    total assets would be less than the sum of our total liabilities, plus the amount that would be needed to satisfy the rights of shareholders
    who have preferential rights superior to those receiving the distribution.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Securities
Authorized for Issuance under Equity Compensation Plans



On
March 19, 2019, our Board of Directors adopted the 2019 Equity Incentive Plan (the “Plan”). The purpose of the Plan is to
attract and retain the best available personnel for positions of substantial responsibility with us, to provide additional incentive
to employees, directors and consultants, and to promote our success. Under the Plan, we are currently able to issue up to an aggregate
total of 10,000,000 incentive or non-qualified options to purchase our common stock, stock awards and other offerings.



Equity
Compensation Plans as of December 31, 2021



|Equity Compensation
                                                 Plans Approved by
                                                 the Shareholders |  | Number of
                                                                                 Securities
                                                                                to
                                                                                be issued
                                                                                upon
                                                                                exercise
                                                                                of
                                                                                outstanding
                                                                                options |   |  | Weighted-
                                                                                average
                                                                                exercise
                                                                                price
                                            of
                                                                                outstanding
                                            options |  |   | Number of
                                            Securities
                                                                                remaining
                                            available
                                                                                for future
                                                                                issuance under
                                                                                equity compensation
                                            plans | 
|-------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|                                                                                                                                                         |  | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |  | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 
|2019 Equity
                                             Compensation Plan                                                                               |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | - |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  | - |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|Other Equity Compensation (restricted stock awards)                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | - |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  | - |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 
|Total                                                                                                                                                    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | - |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  | - |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 



Recent
Sales of Unregistered Securities



From
December 1, 2020 through March 15, 2021, we sold units priced at $25,000 per unit where each unit consisted of (i) an 8.0% Note in
the principal amount of $25,000 convertible into Common Stock (the “Note) and (ii) a warrant at an exercise price of $0.15 for
the purchase of 83,333 shares of the Company’s Common Stock (the “Warrant”).



We
sold 90 Units for total proceeds of $2,265,000. After paying finder fees of $187,450 to our placement agent, we netted $2,077,550, which
will be used for working capital.



In
addition, we also entered into subscription agreements in connection with an equity placement offering of a maximum of $2,000,000 in
units (the “Equity Units”) where each Equity Unit consists of one share of Common Stock at a purchase price of $0.15 and
a warrant to purchase 0.5 share(s) of Common Stock at an exercise price of $0.225 per share. We sold 6,983,333 Equity Units for total
proceeds of $1,047,500. After paying finder fees of $100,763 to our placement agent, we netted $946,737, which was used to pay off the
remaining convertible note debt and will also be used for working capital.



During
the six-month ended June 30, 2021, the company issued a total of 2,868,025 shares of common stock to vendors for compensation and services
rendered.



During
the third quarter of 2021 the company issued a total of 716,554 shares of common stock to vendors for compensation and services rendered.



During
the fourth quarter of 2021 the company issued a total of 59,171 shares of common stock to vendors for compensation and services rendered.





These
securities were issued pursuant to Section 4(2) of the Securities Act and/or Rule 506 promulgated thereunder. The holders represented
their intention to acquire the securities for investment only and not with a view towards distribution. The investors were given adequate
information about us to make an informed investment decision. We did not engage in any general solicitation or advertising. We directed
our transfer agent to issue the stock certificates with the appropriate restrictive legend affixed to the restricted stock.



Item
6. Selected Financial Data



Not
required under Regulation S-K for “smaller reporting companies.”



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



Overview



We
continue to make headway with our strategic objectives to position our company for long-term growth. We are laying the groundwork to
scale with key sales channels now operational, including our recently launched Direct-to-Consumer sales platform.



Working
closely with industry-leading sales, marketing, and logistics partners for our flagship Koan Cordials product line, we have built a multi-channel
distribution strategy. Following our launch into the retail chain and the opening of our e-commerce sales platform, we are turning our
focus to three critical areas - education, targeted marketing, and controlling the sales process.



21







We
took an ambitious approach to our original dispensary rollout and were met with a high amount of interest in our product, reflected by
the roughly 80 dispensaries who requested sample kits. While the reception was very positive, we found reluctance for the dispensaries
to acquire new brands particularly with the advent of the Delta variant of COVID. While the recent threat of a potential COVID-related
retail lockdown in California slowed our progress on the dispensary front, we expect to gain momentum in the retail market as it starts
to open up again by revisiting each of these dispensaries. Many of those initial dispensary requests have been followed up by commitments
to buy once they begin bringing new brands into the stores.



We
believe the careful nurturing of our brand is one of our most important responsibilities as managers of Resonate Blends. Since nobody
knows our product better than we do, we made the decision to bring the sales process in-house versus having an external salesforce. We
are confident this move will have an immediate positive impact on revenues and allow our team to better control the narrative within
the retail network in California.



We
plan to soon offer several packaging variations for our Cordials based on dispensary and consumer feedback. In addition to our Cordial
3-pack, we plan to soon have a single-packaged Cordial, and a multi-blends sampler SKU. We believe having these options encourages the
consumer to try more blends and will allow us to do more sampling and upselling promotions. We are also designing a multi-dose bottle
which will be more cost-effective for those who use our blends daily. Together, these new packaging configurations should help accelerate
our sales revenue by providing consumers convenient options. We also expect to introduce two new formulations and other unique product
lines that will showcase our focus on continual product development and brand innovation within our family of Koan products.



While
we expect to ramp up our retail footprint in the quarters ahead, we did make several key entry points to dispensaries. To that end, we
recently announced nine (9) new California One Plant dispensaries and are working closely with them to co-market the Cordials across
their vast network. The collaboration and communication with the One Plant team is deep and we will be exploring creative and unique
marketing efforts at two of their flagship stores. We are an approved vendor for the Joy Reserve located in the Westfield Centre in Union
Square (San Francisco). The Joy Reserve is the first cannabis dispensary located in a mall setting and offers consumers education and
guidance to select the best products for their lifestyles.



We
just launched with The Joy Reserve dispensary, which is focused on bringing a better understanding of the many benefits of cannabis and
how to safely pick quality products such as the Koan Cordials. This unique showcase will be used to educate consumers about plant-based
wellness with an open browsing floor, free consultations and workshops. We feel this setup is ideal to introduce consumers to our Cordials
and are excited to participate in this groundbreaking approach.





22







Marketing
and branding are core components of our targeted customer acquisition strategy. We have invested significantly to our overall marketing
efforts, including cannabis conferences, social media outreach, Search Engine Optimization (SEO), and marketing events with our dispensary
partners. We recently consolidated our digital marketing to the Flower Agency, a full digital marketing agency that assists lifestyle,
wellness and cannabis brands with customer acquisition, awareness and re-engagement. Importantly, our patent-pending Koan Cordials, the
world’s first cannabis-infused cordial, are starting to gain national recognition from cannabis industry leaders. We expect to
see a significant uptick in press and other media mentions in the coming months.



We
are very encouraged with our Koan Cordials winning the show’s Gold Leaf Award for “Best New Brand of 2021” at the invitation-only
“Luxury Meets Cannabis Conference”. The Gold Leaf Awards honor those visionary crossover brands, retailers, and founders
that are going above and beyond both in and outside of the cannabis space — across beauty, skincare, food/beverage, and everyday
wellness sectors. The interest since this award announcement for potential acquisitions and new state expansion has been extremely gratifying.



Koan Cordials also won a Bronze 2021 Clio Cannabis Award for brand
design in the packaging category. The Clio Awards is an annual global award program recognizing innovation and creative excellence in
advertising, design and communication. Clio Cannabis recognizes and elevates creative contributions from top design talent in the rapidly
growing cannabis market.



With
an established statewide infrastructure in California for manufacturing, distribution and sales, we are well-equipped to make progress
with our go-forward focus on revenue generation. We are uniquely positioned to be a positive disruptive force in the wellness/lifestyle
segment of the industry built on a growing body of proprietary IP, and we firmly believe that value-added brands are the future of the
Cannabis industry. Over the long-term, we believe that cannabis, as a part of the wellness lifestyle, will become the largest segment
in the burgeoning industry and we plan to be one of the leaders in this segment.



Results
of Operations for the Years Ended December 31, 2021 and 2020



Revenues



We
have generated $27,031 in revenues for the year ended December 31, 2021, as compared with no sales for the year ended December
31, 2020 on our current product line, and also no sales from the discontinued operations of our sold subsidiary, Textmunication, Inc.,
for the years ended December 31, 2021 and 2020, respectively. We have launched our first line of six Cordial products in California and
we have started to generate revenues from the sale of these products.



We
anticipate increased revenues on our six Cordials for the rest of 2022. We anticipate a rollout of new packaging configurations by early
Q2 2022 for our Cordials; to include both a one-pack and a multi-dose bottle which is expected to bring the cost per dose
down considerably. We also plan on launching additional Cordial formulations by Q2 2022 and a new line of edibles in
mid-2022, which we anticipate will contribute to increasing our revenues. As we have just launched our products,
however, it may take some time for the markets to react, gain traction and result in brand awareness among our customers. There can
be no assurances, however, that customers will positively react to our products.



Operating
Expenses



Our
operating expenses were $2,534,577 for the year ended December 31, 2021, as compared with $1,813,958 for the year ended December
31, 2020.



The main drivers for
the overall increase in operating expenses in 2021 was our focus on advertising to support our planned growth and non-cash items related
to broker and employee equity compensation. We paid both cash fees and stock compensation to a broker on our Private Placement Memorandum
in Q1.



Within the operating
expenses, there were a variety of increases, the largest of which was an increase in non-cash management fees of $400,349 as a result
of issuing stock in 2021 in settlement of accrued but unpaid management and employee salaries in 2020. We hope that to avoid these settlement
expenses for 2022 and compensate employees with available cash on hand. However, if we are forced to defer salaries and settle with shares
for employees this year, due to a lack of funds, we should expect our non-cash compensation expense in 2022 to resemble that of 2021.



In 2021 and 2020, we
compensated a broker with combined share and cash compensation valued at $512,312 and $34,250, respectively for its services as placement
agent. We expect to incur similar broker expenses as long as we are dependent on additional financing for our operations, and we expect
that will be the case for the rest of 2022.



We spent $604,564 more
on advertising in 2021 than in 2020. This money was used to introduce our Koan Cordials to the California retail channel, perform Search
Engine Optimization (SEO), conduct Programmatic advertising, hire a professional agency to promote our Cordials on social media channels
and other general advertising methods. We believe our advertising efforts will pay dividends throughout 2022 as the awareness groundwork
has been established to educate the market on our family of Cordial formulations.



Professional fees increased
by $45,175 in 2021 compared with 2020. With more focus on operations, we have spent more on professional fees. We expect that professional
fees will increase in 2022 as we continue to ramp up operations.



General and administrative
expenses decreased by $520,409 in 2021 compared with 2020. This resulted from bringing several outside services in-house and not having
to address outstanding debt liabilities from our previous spin-out of Textmunication Holdings, Inc. in 2020. We expect general and administrative
expenses to remain fairly constant throughout 2022 due to internal changes we’ve implemented.





Other
Income



We
had other expenses of $2,346,362 for the year ended December 31, 2021 compared with other expenses of $143,113 for the year ended
December 31, 2020. Our other expenses for the year ended December 31, 2021 was mainly attributable to a loss on revaluation of derivative
liabilities.



23







Net
Income/Loss



We
had net loss of $4,873,056 for the year ended December 31, 2021, as compared with net loss of $1,941,274 for the year ended December
31, 2020. Our increased loss in 2021 is mainly from a lack of revenue, combined with increased advertising to support our growth and
significant non-cash expenses related to broker and employee equity compensation. We believe that our increased marketing activity and
compensating valuable employees and partners will pay off with increased brand exposure that we expect will generate more sales for the
upcoming year.



Liquidity
and Capital Resources



As
of December 31, 2021, we had total current assets of $269,518, consisting of $12,913 in cash, $10,830 in advances to suppliers and
$245,776 in Inventories. Our total current liabilities as of December 31, 2021 were $4,402,886. We had a working capital deficit
of $4,133,368 as of December 31, 2021, compared with a working capital deficit of $996,439 as of December 31, 2020.



Cash
Flows from Operating Activities



Operating
activities used $2,792,687 in cash for the year ended December 31, 2021, compared with cash used of $1,381,003 for the year ended
December 31, 2020. Our negative operating cash flow for the year ended December 31, 2021 was largely the result of our net loss, offset
mainly by the loss on derivative liabilities. Our negative operating cash flow for the year ended December 31, 2020 was largely the
result also of our net loss, offset mainly by share based compensation.



Cash
Flows from Investing Activities



Investing
activities used $36,047 in cash for the year ended December 31, 2021 while we used no cash on investing activities for the year
ended December 31, 2020.



Cash
Flows from Financing Activities



Cash
flows provided by financing activities during the year ended December 31, 2021 amounted to $2,727,322 compared with cash flows
provided by financing activities of $1,492,213 for the year ended December 31, 2020. Our positive cash flows for the year ended December
31, 2021 consisted of proceeds from issuance of common stock of $1,367,115, proceeds from Convertible notes payable of $1,865,000,
offset by payments of notes payable of $504,793. Our positive cash flows for the year ended December 31, 2020 consisted of proceeds
from issuance of common stock $1,011,113, proceeds from Convertible notes payable $850,100, offset by payments of notes payable of $369,000.



The
features of the debt instruments and payables concerning our financing activities are detailed in the footnotes to our financial statements.



We
are dependent on investment capital to continue our survival. We have raised money through convertible debt, almost always on unfavorable
terms. There is no guarantee that these small convertible loans will be available to us in the future or on terms acceptable to us.



We
also plan to raise money in the sale of our equity and debt securities. There can be no assurance of funds from these efforts or that
any other type of additional financing will be available to us on acceptable terms, or at all.



Going
Concern



As
of December 31, 2021, we have an accumulated deficit of $25,974,051. Our ability to continue as a going concern is contingent
upon the successful completion of additional financing arrangements and our ability to achieve and maintain profitable operations. While
we are expanding our best efforts to achieve the above plans, there is no assurance that any such activity will generate funds that will
be available for operations. These conditions raise substantial doubt about our ability to continue as a going concern. These financial
statements do not include any adjustments that might arise from this uncertainty.



Off
Balance Sheet Arrangements



As
of December 31, 2021, there were no off-balance sheet arrangements.



Critical
Accounting Policies



In
December 2001, the SEC requested that all registrants list their most “critical accounting polices” in the Management Discussion
and Analysis. The SEC indicated that a “critical accounting policy” is one which is both important to the portrayal of a
company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments, often
as a result of the need to make estimates about the effect of matters that are inherently uncertain. Our critical accounting policies
are disclosed in Note 2 of our audited financial statements included in the Form 10-K filed with the Securities and Exchange Commission.



Recent
Accounting Pronouncements



No
new accounting pronouncements issued or effective during the fiscal year has had or is expected to have a material impact on the financial
statements.





24







Item
8. Financial Statements and Supplementary Data



Index
to Financial Statements Required by Article 8 of Regulation S-X:



Audited
Financial Statements:



|F-1 | Consolidated Balance Sheets as of December 31, 2021 and 2020;                            
|--- | -----------------------------------------------------------------------------------------
|F-2 | Consolidated Statements of Operations for the years ended December 31, 2021 and 2020;    
|F-3 | Consolidated Statement of Stockholders’ Equity for the year ended December 31, 2020;     
|F-3 | Consolidated Statement of Stockholders’ Equity for the year ended December 31, 2020;     
|F-4 | Consolidated Statements of Cash Flows for the years ended December 31, 2021 and 2020; and
|F-5 | Notes to Consolidated Financial Statements                                               



25







RESONATE
BLENDS, INC.

(FORMERLY
TEXTMUNICATION HOLDINGS, INC.)

CONSOLIDATED
BALANCE SHEET





|                                                                                                                                                                                 |  |                   |             |   |                   |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | ----------- | - | ----------------- | -
|                                                                                                                                                                                 |  | December 31, 2021 |             |   | December 31, 2020 |  
|ASSETS                                                                                                                                                                           |  |                   |             |   |                   |  
|Current assets                                                                                                                                                                   |  |                   |             |   |                   |  
|Cash and cash equivalents                                                                                                                                                        |  | $                 | 12,913      |   |                   | $
|Receivables                                                                                                                                                                      |  |                   |             |   |                   |  
|Prepaid expenses and other current assets                                                                                                                                        |  |                   | 10,830      |   |                   |  
|Inventories                                                                                                                                                                      |  |                   | 245,776     |   |                   |  
|Total current assets                                                                                                                                                             |  |                   | 269,518     |   |                   |  
|Fixed assets, net                                                                                                                                                                |  |                   | 31,337      |   |                   |  
|Investment in equity method investee                                                                                                                                             |  |                   | 100         |   |                   |  
|TOTAL ASSETS                                                                                                                                                                     |  |                   | 300,955     |   |                   |  
|                                                                                                                                                                                 |  |                   |             |   |                   |  
|LIABILITIES AND STOCKHOLDERS’ DEFICIT                                                                                                                                            |  |                   |             |   |                   |  
|Current liabilities                                                                                                                                                              |  |                   |             |   |                   |  
|Accounts payable and accrued liabilities                                                                                                                                         |  |                   | 206,872     |   |                   |  
|Due to related parties                                                                                                                                                           |  |                   | 45,000      |   |                   |  
|Convertible notes payable, net of discount                                                                                                                                       |  |                   | 1,865,000   |   |                   |  
|Derivative liability                                                                                                                                                             |  |                   | 2,286,014   |   |                   |  
|Settlement liability                                                                                                                                                             |  |                   |             |   |                   |  
|Current liabilities of discontinued operations                                                                                                                                   |  |                   |             |   |                   |  
|Total current liabilities                                                                                                                                                        |  |                   | 4,402,886   |   |                   |  
|Total liabilities                                                                                                                                                                |  |                   | 4,402,886   |   |                   |  
|Stockholders’ deficit                                                                                                                                                            |  |                   |             |   |                   |  
|Preferred stock, 10,000,000 shares authorized, $0.0001 par value, 2,000,000 shares issued.                                                                                       |  |                   |             |   |                   |  
|Series B - Preferred stock, 66,667 shares authorized, $0.0001 par value, 0 issued.                                                                                               |  |                   |             |   |                   |  
|Series C - Preferred stock, 2,000,000 shares authorized, $0.0001 par value, 2,000,000 issued and outstanding                                                                     |  |                   | 200         |   |                   |  
|Series D Preferred stock 40,000 shares authorized, $0.0001 par value 40,000 and 0 issued and outstanding, respectively                                                           |  |                   |             |   |                   |  
|Preferred stock                                                                                                                                                                  |  |                   | -           |   |                   |  
|Common stock; $0.0001 par value; 200,000,000 shares authorized; 45,046,637 and 29,769,627 shares issued and outstanding as of December 31, 2021 December 31, 2020, respectively. |  |                   | 4,504       |   |                   |  
|Additional paid-in capital                                                                                                                                                       |  |                   | 21,867,416  |   |                   |  
|Accumulated deficit                                                                                                                                                              |  |                   | (25,974,051 | ) |                   |  
|Total Stockholders’ deficit                                                                                                                                                      |  |                   | (4,101,931  | ) |                   |  
|TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY                                                                                                                                       |  | $                 | 300,955     |   |                   | $





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





F-1









RESONATE
BLENDS, INC.

(FORMERLY
TEXTMUNICATION HOLDINGS, INC.)

CONSOLIDATED
STATEMENT OF OPERATION



|                                                        |  |                        |            |                         |                  |   |            |                  |  |   |                  |  
|------------------------------------------------------- |  | ---------------------- | ---------- | ----------------------- | ---------------- | - | ---------- | ---------------- |  | - | ---------------- | -
|                                                        |  | The Three Months Ended |            | The Twelve Months Ended |                 
|                                                        |  | December 31 2021       |            |                         | December 31 2020 |   |            | December 31 2021 |  |   | December 31 2020 |  
|REVENUES                                                |  | $                      | 19,457     |                         |                  | $ | -          |                  |  | $ | 27,031           |  
|COST OF REVENUES                                        |  |                        | 6,844      |                         |                  |   | -          |                  |  |   | 19,148           |  
|Gross profit                                            |  |                        | 12,613     |                         |                  |   | -          |                  |  |   | 7,883            |  
|Operating expenses                                      |  |                        |            |                         |                  |   |            |                  |  |   |                  |  
|Advertising                                             |  |                        | 176,702    |                         |                  |   | 475        |                  |  |   | 611,914          |  
|General and administrative expenses                     |  |                        | 74,417     |                         |                  |   | 222,670    |                  |  |   | 158,935          |  
|Legal and Professional fees                             |  |                        | 49,101     |                         |                  |   | 120,755    |                  |  |   | 567,025          |  
|Officer Compensation                                    |  |                        | 122,500    |                         |                  |   | 210,400    |                  |  |   | 556,865          |  
|Salaries and Related                                    |  |                        | 40,000     |                         |                  |   | (185,400   | )                |  |   | 236,250          |  
|Sales Commission                                        |  |                        | -          |                         |                  |   | -          |                  |  |   | -                |  
|Office Rent                                             |  |                        | 1,369      |                         |                  |   | (405       | )                |  |   | 3,239            |  
|Impairment of inhouse software                          |  |                        | -          |                         |                  |   | -          |                  |  |   | -                |  
|Non cash management fees                                |  |                        | (866,949   | )                       |                  |   | -          |                  |  |   | 400,349          |  
|Total operating expenses                                |  |                        | (402,860   | )                       |                  |   | 368,495    |                  |  |   | 2,534,577        |  
|Loss from operations                                    |  |                        | 415,473    |                         |                  |   | (368,495   | )                |  |   | (2,526,694       | )
|Other Income (expense)                                  |  |                        |            |                         |                  |   |            |                  |  |   |                  |  
|Other Income                                            |  |                        | -          |                         |                  |   | -          |                  |  |   | 690              |  
|Interest expense                                        |  |                        | (38,048    | )                       |                  |   | (206       | )                |  |   | (135,292         | )
|Gain on change of derivative liability                  |  |                        | 1,156,717  |                         |                  |   | 592,769    |                  |  |   | (2,011,881       | )
|Amortization of debt discount                           |  |                        | -          |                         |                  |   | (15,875    | )                |  |   | (10,583          | )
|Amortization of debt issuance costs                     |  |                        | (61,771    | )                       |                  |   | -          |                  |  |   | (247,085         | )
|Gain (loss) on settlement of derivative liabilities     |  |                        | -          |                         |                  |   | (7,175     | )                |  |   | -                |  
|Legal settlement                                        |  |                        | -          |                         |                  |   | (1         | )                |  |   | -                |  
|Gain on settlement of notes payable                     |  |                        | -          |                         |                  |   | -          |                  |  |   | 62,500           |  
|Depreciation expense                                    |  |                        | (4,711     | )                       |                  |   |            |                  |  |   | (4,711           | )
|Total other expense                                     |  |                        | 1,052,187  |                         |                  |   | 569,512    |                  |  |   | (2,346,362       | )
|Income (loss) from investment in equity method investee |  |                        | -          |                         |                  |   | -          |                  |  |   | -                |  
|NET INCOME (LOSS) from continuing operations            |  |                        | 1,467,659  |                         |                  |   | 201,017    |                  |  |   | (4,873,056       | )
|NET INCOME (LOSS) from discontinued operations          |  |                        |            |                         |                  |   |            |                  |  |   |                  |  
|NET INCOME (LOSS)                                       |  |                        | 1,467,659  |                         |                  |   | 201,017    |                  |  |   | (4,873,056       | )
|                                                        |  |                        |            |                         |                  |   |            |                  |  |   |                  |  
|Basic weighted average common shares outstanding        |  |                        | 31,085,610 |                         |                  |   | 25,455,550 |                  |  |   | 31,085,610       |  
|Net Income (loss) per common share: basic and diluted   |  | $                      | 0.02       |                         |                  | $ | 0.01       |                  |  | $ | (0.19            | )





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



F-2









RESONATE
BLENDS, INC.

(FORMERLY
TEXTMUNICATION, INC.)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020



|                            |  |                          |   |                            |  |              |   |            |  |  |             |  |  |                     |     |  |  |  |            |  |  |   |       |  |  |   |            |  |  |   |             |   |  |   |            |  
|--------------------------- |  | ------------------------ | - | -------------------------- |  | ------------ | - | ---------- |  |  | ----------- |  |  | ------------------- | --- |  |  |  | ---------- |  |  | - | ----- |  |  | - | ---------- |  |  | - | ----------- | - |  | - | ---------- | -
|                            |  | Preferred Stock Series A |   | Preferred stock - Series C |  | Common Stock |   | Additional |  |  | Accumulated |  |  | Total Stockholders’ |    
|Balance, December 31, 2020  |  |                          | - |                            |  |              | - |            |  |  | 2,000,000   |  |  |                     | 200 |  |  |  | 29,769,627 |  |  |   | 2,976 |  |  |   | 20,101,480 |  |  |   | (21,100,995 | ) |  |   | (996,339   | )
|Issuance of common stock    |  |                          |   |                            |  |              |   |            |  |  |             |  |  |                     |     |  |  |  | 11,633,260 |  |  |   | 1,163 |  |  |   | 1,721,338  |  |  |   |             |   |  |   | 1,722,501  |  
|Net Loss for the quarter    |  |                          | - |                            |  |              | - |            |  |  | -           |  |  |                     | -   |  |  |  |            |  |  |   |       |  |  |   |            |  |  |   | (1,058,462  | ) |  |   | (1,058,462 | )
|Balance, March 30, 2021     |  |                          | - |                            |  | $            | - |            |  |  | 2,000,000   |  |  | $                   | 200 |  |  |  | 41,402,887 |  |  | $ | 4,139 |  |  | $ | 21,822,818 |  |  | $ | (21,100,995 | ) |  | $ | (332,300   | )
|Net Loss for the quarter    |  |                          | - |                            |  |              | - |            |  |  | -           |  |  |                     | -   |  |  |  | -          |  |  |   | -     |  |  |   | -          |  |  |   | (6,439,991  | ) |  |   | (6,439,991 | )
|Issuance of common stock    |  |                          | - |                            |  |              | - |            |  |  | -           |  |  |                     | -   |  |  |  | 2,868,025  |  |  |   | 288   |  |  |   | 582,920    |  |  |   |             |   |  |   | 583,208    |  
|Balances June 30, 2021      |  |                          | - |                            |  | $            | - |            |  |  | 2,000,000   |  |  | $                   | 200 |  |  |  | 44,270,912 |  |  | $ | 4,427 |  |  | $ | 22,405,738 |  |  | $ | (27,540,986 | ) |  | $ | (5,130,621 | )
|Net Loss for the quarter    |  |                          | - |                            |  |              | - |            |  |  | -           |  |  |                     | -   |  |  |  | -          |  |  |   | -     |  |  |   | -          |  |  | $ | 99,274      |   |  | $ | 99,274     |  
|Non cash compensation       |  |                          |   |                            |  |              |   |            |  |  |             |  |  |                     |     |  |  |  | 716,554    |  |  | $ | 72    |  |  | $ | 328,632    |  |  |   |             |   |  | $ | 328,704    |  
|Balances September 30, 2021 |  |                          | - |                            |  | $            | - |            |  |  | -           |  |  | $                   | 200 |  |  |  | 44,987,466 |  |  | $ | 4,499 |  |  | $ | 22,734,370 |  |  | $ | (27,441,711 | ) |  | $ | (4,702,642 | )
|Net Loss for the quarter    |  |                          | - |                            |  |              | - |            |  |  | -           |  |  |                     | -   |  |  |  | -          |  |  |   | -     |  |  |   | -          |  |  | $ | 577,647     |   |  | $ | 577,647    |  
|Non cash compensation       |  |                          | - |                            |  |              | - |            |  |  | -           |  |  |                     | -   |  |  |  | 59,171     |  |  | $ | 5     |  |  | $ | 23,059     |  |  |   |             |   |  | $ | 23,064     |  
|Balances December 31, 2021  |  |                          | - |                            |  | $            | - |            |  |  | -           |  |  | $                   | 200 |  |  |  | 45,046,637 |  |  | $ | 4,504 |  |  | $ | 22,757,429 |  |  | $ | (26,864,064 | ) |  | $ | (4,101,931 | )





|                                              |  | Shares |           |  | Amount |   |      | Shares |  |  | Amount    |  |  | Shares |     |  | Amount |  |            | Paid-in Capital |  |   | Deficit |   |  | Deficit |           
|--------------------------------------------- |  | ------ | --------- |  | ------ | - | ---- | ------ |  |  | --------- |  |  | ------ | --- |  | ------ |  | ---------- | --------------- |  | - | ------- | - |  | ------- | ----------
|Balance December 31, 2019                     |  |        | 4,000,000 |  |        | $ | 400  |        |  |  | 2,000,000 |  |  | $      | 200 |  |        |  | 17,133,936 |                 |  | $ | 1,715   |   |  | $       | 18,570,178
|Net Loss for the quarter                      |  |        | -         |  |        |   | -    |        |  |  | -         |  |  |        | -   |  |        |  | -          |                 |  |   | -       |   |  |         | -         
|Common stock issuance                         |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  | 2,571,778  |                 |  |   | 255     |   |  |         | 275,440   
|Balance March 31, 2020                        |  |        | 4,000,000 |  |        | $ | 400  |        |  |  | 2,000,000 |  |  | $      | 200 |  |        |  | 19,705,714 |                 |  | $ | 1,970   |   |  | $       | 18,845,618
|Net Loss for the quarter                      |  |        | -         |  |        |   | -    |        |  |  | -         |  |  |        | -   |  |        |  | -          |                 |  |   | -       |   |  |         | -         
|Non-Cash Compensation                         |  |        | -         |  |        |   | -    |        |  |  | -         |  |  |        | -   |  |        |  | 2,495,129  |                 |  |   | 250     |   |  |         | 249,265   
|Conversion of notes payable                   |  |        | -         |  |        |   | -    |        |  |  | -         |  |  |        | -   |  |        |  | 750,000    |                 |  |   | 75      |   |  |         | 74,925    
|Common stock issue                            |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  | 1,000,000  |                 |  |   | 100     |   |  |         | 99,900    
|Balance June 30, 2020                         |  |        | 4,000,000 |  |        |   | 400  |        |  |  | 2,000,000 |  |  |        | 200 |  |        |  | 23,950,843 |                 |  |   | 2,395   |   |  |         | 19,269,708
|Net Loss for the quarter                      |  |        | -         |  |        |   | -    |        |  |  | -         |  |  |        | -   |  |        |  | -          |                 |  |   | -       |   |  |         | -         
|Common stock Issuance for Cash                |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  | 2,903,333  |                 |  |   | 290     |   |  |         | 389,710   
|Conversion of notes payable                   |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  | 900,000    |                 |  |   | 90      |   |  |         | 89,910    
|Cancellation of shares held by Textmunication |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  | (4,755,029 | )               |  |   | (476    | ) |  |         | (332,376  
|Non cash compensation                         |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  | 1,335,279  |                 |  |   | 134     |   |  |         | 93,336    
|Shares issues for legal settlement            |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  | 455,555    |                 |  |   | 46      |   |  |         | 31,842    
|Cancellation of preferred stock               |  |        | -4000000  |  |        |   | -400 |        |  |  |           |  |  |        |     |  |        |  |            |                 |  |   |         |   |  |         | 400       
|Balance September 30, 2020                    |  |        | -         |  |        |   | -    |        |  |  | 2,000,000 |  |  |        | 200 |  |        |  | 24,789,981 |                 |  |   | 2,479   |   |  |         | 19,542,530
|Net Gain for the quarter                      |  |        | -         |  |        |   | -    |        |  |  | -         |  |  |        | -   |  |        |  | -          |                 |  |   | -       |   |  |         | -         
|Net Gain (Loss) for the quarter               |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  |            |                 |  |   |         |   |  |         |           
|Non-Cash Compensation                         |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  |            |                 |  |   |         |   |  |         |           
|Conversion of notes payable                   |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  |            |                 |  |   |         |   |  |         |           
|Common stock issue                            |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  | 4,979,646  |                 |  |   | 497     |   |  |         | 558,950   
|Issuance of common stock                      |  |        |           |  |        |   |      |        |  |  |           |  |  |        |     |  |        |  | 4,979,646  |                 |  |   | 497     |   |  |         | 558,950   
|Balance December 30, 2020                     |  |        | -         |  |        |   | -    |        |  |  | 2,000,000 |  |  |        | 200 |  |        |  | 29,769,627 |                 |  |   | 2,976   |   |  |         | 20,101,480



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



F-3









RESONATE
BLENDS, INC.

(FORMERLY TEXTMUNICATION,
INC.)
CONSOLIDATED STATEMENTS OF CASH FLOWS

For
nine months ended September 30



|                                                                               |  | 2021 |            |   | 2020 |  
|------------------------------------------------------------------------------ |  | ---- | ---------- | - | ---- | -
|Cash Flows from Operating Activities                                           |  |      |            |   |      |  
|Net Income (loss)                                                              |  | $    | (4,873,056 | ) |      | $
|Net loss from discontinued operations                                          |  |      |            |   |      |  
|Adjustments to reconcile                                                       |  |      |            |   |      |  
|Amortization and depreciation                                                  |  |      | 10,583     |   |      |  
|Impairment of investments                                                      |  |      | -          |   |      |  
|Loss on derivative liability                                                   |  |      | 2,011,880  |   |      |  
|Non cash interest expense                                                      |  |      | 16,142     |   |      |  
|Legal Settlement                                                               |  |      |            |   |      |  
|Share professional fees                                                        |  |      | 82,473     |   |      |  
|Share based compensation                                                       |  |      | 400,349    |   |      |  
|Gain (Loss) on the settlement of debt                                          |  |      | (62,500    | ) |      |  
|Gain on settlement of derivative liabilities                                   |  |      |            |   |      |  
|Changes in assets and liabilities                                              |  |      |            |   |      |  
|Receivables                                                                    |  |      |            |   |      |  
|Inventories                                                                    |  |      | (245,777   | ) |      |  
|Prepaid expenses and other current assets                                      |  |      | (10,830    | ) |      |  
|Advances to suppliers                                                          |  |      | (54,599    | ) |      |  
|Accounts payable and accrued expenses                                          |  |      | 7,936      |   |      |  
|Accumulated Depreciation                                                       |  |      | 4,711      |   |      |  
|Due to Related party                                                           |  |      | (80,000    | ) |      |  
|Net cash used by operating activities                                          |  |      | (2,792,687 | ) |      |  
|Net cash provided by (used in) operating activities of discontinued operations |  |      |            |   |      |  
|Net cash used in operations                                                    |  |      | (2,792,687 | ) |      |  
|Cash Flows from investing activities                                           |  |      |            |   |      |  
|Purchase of fixed assets                                                       |  |      | (36,047    | ) |      |  
|Net cash used by investing activities                                          |  |      | (36,047    | ) |      |  
|Cash Flows from Financing Activities                                           |  |      |            |   |      |  
|Proceeds from subscription                                                     |  |      | 1,367,115  |   |      |  
|Proceeds from convertible notes (net)                                          |  |      | 1,865,000  |   |      |  
|Proceeds from notes payables                                                   |  |      |            |   |      |  
|Payments on preferred stocks buy back                                          |  |      |            |   |      |  
|Payments on convertible notes payable                                          |  |      | (504,793   | ) |      |  
|Net cash provided by financing activities                                      |  |      | 2,727,322  |   |      |  
|Net cash provided by financing activities of discontinued operations           |  |      |            |   |      |  
|Net cash used in finance                                                       |  |      | 2,727,322  |   |      |  
|Net increase in cash                                                           |  |      | (101,412   | ) |      |  
|Cash, beginning of period                                                      |  |      | 114,325    |   |      |  
|Cash, end of period                                                            |  | $    | 12,913     |   |      | $
|                                                                               |  |      |            |   |      |  
|Supplemental disclosure of cash flow information                               |  |      |            |   |      |  
|Cash paid for interest                                                         |  | $    | 38,048     |   |      | $
|Cash paid for tax                                                              |  |      | -          |   |      |  
|Non-Cash investing and financing transactions                                  |  |      |            |   |      |  
|Conversion of debt for common stock                                            |  | $    | 306,858    |   |      | $
|Settlement of derivative liability                                             |  | $    | -          |   |      | $



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



F-4









RESONATE BLENDS,
INC.

(formerly TEXTMUNICATION
HOLDINGS, INC.)

NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS

FOR THE YEARS ENDED
DECEMBER 31, 2021 and 2020



NOTE 1 – BASIS
OF PRESENTATION AND GOING CONCERN



The Company



Resonate Blends, Inc.
formerly Textmunication Holdings, Inc. (the “Company”) was incorporated on in October 1984 in the State of Georgia as Brock
Control Systems. Founded by Richard T. Brock, the Company was in the sales automation market and an early developer of enterprise customer
management systems. The Company went public at the end of March of 1993. In February of 1996, the Company changed its name to Brock International
Inc., and in March of 1998, the Company again changed our name to Firstwave Technologies, Inc.



In 2007, the Company
deregistered its common stock in order to avoid the expenses of being a public company. The Company reported briefly on the OTC Disclosure
& News Service in 2008 but not for long. The Company again changed its name to FSTWV, Inc.



On October 28, 2013,
the Company held a shareholder meeting to reincorporate the company in the State of Nevada and concurrently change its name to Textmunication
Holdings, Inc. The Company also voted to approve a 1 for 5 reverse split of its outstanding common stock.



On November 16, 2013,
the Company entered into a Share Exchange Agreement (SEA) with Textmunication, Inc. a California corporation, whereby the sole shareholder
of the Company received 65,640,207 new shares of common stock of the Company in exchange for 100% of the Textmunication’s issued
and outstanding shares.



Textmunication is an
online mobile marketing platform service that will connect merchants with their customers and allow them to drive loyalty and repeat
business in a non-intrusive, value added medium. For merchants we provide a mobile marketing platform where they can always send the
most up-to-date offers/discounts/alerts/events schedule, such as happy hours, trivia night, and other campaigns. The consumer can also
access specials and promotions that merchants choose to distribute through Textmunication by opting into keywords designated to the merchant’s
keywords.



On July 9, 2018, the
1 – 1,000 Reverse Split of the Company’s common stock took effect at the open of business. All shares and per share amounts
have been retroactively adjusted to reflect the reverse split.



On June 25, 2019, the
Company issued a press release announcing it plans to change its business direction from its current SMS technology business to focus
on the emerging national cannabis market. The Company planned on using its mobile texting platform to enhance communication efforts with
the potential acquisitions.



On October 25, 2019,
the Company entered into a Membership Interest Purchase Agreement (the “Resonate Purchase Agreement”) with Resonate Blends,
LLC, a California limited liability company (“Resonate”), and the members of Resonate. As a result of the transaction, Resonate
became a wholly owned subsidiary of the Company. In accordance with the terms of the Purchase Agreement, at the closing an aggregate
of 5% of the Company’s outstanding shares of common stock for a total of 665,072 shares were issued to the holders of Resonate
in exchange for their membership interests of Resonate. These shares have anti-dilution protection. We have also agreed as part of the
purchase price to issue: (ii) such number of shares of Series E Preferred Stock that will convert into 5% of the outstanding shares of
common stock in the Company on a fully-diluted basis upon an annualized revenue run rate of Ten Million Dollars ($10,000,000.00) for
any three (3) consecutive month trailing period; and (iii) such number of shares of Series E Preferred Stock that will convert into 5%
of the outstanding shares of common stock in the Company on a fully-diluted basis upon the occurrence of the Company’s public market
value reaching One Hundred Million US Dollars ($100,000,000). The shares in (ii) and (iii) shall have anti-dilution protections, except
that this provision only applies for 2.5% of the outstanding shares acquired under each subsection.



F-5









Also, on October 25,
2019, the Company entered into a Membership Interest Purchase Agreement (the “Entourage Labs Purchase Agreement”) with Entourage
Labs, LLC, a California limited liability company (“Entourage Labs”), and the members of Entourage Labs. As a result of the
transaction, Entourage Labs became a wholly owned subsidiary of the Company. In accordance with the terms of the Purchase Agreement,
at the closing an aggregate of 5% of the Company’s outstanding shares of common stock for a total of 665,072 shares were issued
to the holders of Entourage Labs in exchange for their membership interests of Entourage Labs. These shares have anti-dilution protection.
We have also agreed as part of the purchase price to issue: (ii) such number of shares of Series E Preferred Stock that will convert
into 5% of the outstanding shares of common stock in the Company on a fully-diluted basis upon an annualized revenue run rate of Ten
Million Dollars ($10,000,000.00) for any three (3) consecutive month trailing period; and (iii) such number of shares of Series E Preferred
Stock that will convert into 5% of the outstanding shares of common stock in the Company on a fully-diluted basis upon the occurrence
of the Company’s public market value reaching One Hundred Million US Dollars ($100,000,000). The shares in (ii) and (iii) shall
have anti-dilution protections, except that this provision only applies for 2.5% of the outstanding shares acquired under each subsection.



In addition, the Company
entered into an Agreement of Conveyance, Transfer and Assignment of Assets and Assumption of Obligations (the “Conveyance Agreement”)
with Mark S. Johnson and the Company’s 49% owned subsidiary, Aspire Consulting Group, LLC, a Virginia limited liability company.
Pursuant to the Conveyance Agreement, the Company transferred all assets and business operations associated with its IT consulting solutions,
including all of the capital stock of Aspire Consulting, to Mr. Johnson. In exchange, Mr. Johnson agreed to cancel 20,000 shares of common
stock in the Company and to assume and cancel all liabilities relating to the Company’s former business.



Finally, the Company
entered into Employment Agreements with the following persons: (i) Geoffrey Selzer as Chief Executive Officer (CEO) of the Company with
an annual salary of $180,000; and (ii) Pamela Kerwin as Chief Operating Officer (COO) of the Company with an annual salary of $120,000.
Both are eligible for salary increases upon milestone achievements and other benefits. The Employment Agreement for the CEO has a term
of 2 years and can’t be terminated without cause. Severance of six (6) weeks is available for termination of the COO without cause
before one-year of service and eight (8) weeks after one-year of service.



On December 16, 2019
the Company filed Articles of Merger with the Secretary of State of Nevada in order to effectuate a merger with its wholly owned subsidiary;
Resonate Blends, Inc. Shareholder approval was not required under Section 92A.180 of the Nevada Revised Statutes. As part of the merger,
the Company’s board of directors authorized a change in our name to “Resonate Blends, Inc.” and the Company’s
Articles of Incorporation have been amended to reflect this name change.



In connection with
the name change, the Company’s symbol was changed to “KOAN” that more resembles the Company’s new business focus.



On January 20, 2020,
Wais Asefi resigned as Chairman and as a member of our Board of Directors. Mr. Asefi’s resignation is in support of Resonate Blends
strategic direction of becoming a pure play cannabis company. The Company does not believe that Mr. Asefi has any disagreements on matters
relating to our operations, policies or practices. Also, on January 20, 2020, our Board of Directors appointed Geoffrey Selzer as our
Chairman.



On December 16, 2019
the Company filed Articles of Merger with the Secretary of State of Nevada in order to effectuate a merger with its wholly owned subsidiary;
Resonate Blends, Inc. Shareholder approval was not required under Section 92A.180 of the Nevada Revised Statutes. As part of the merger,
the Company’s board of directors authorized a change in our name to “Resonate Blends, Inc.” and the Company’s
Articles of Incorporation have been amended to reflect this name change.



In connection with
the name change, the Company’s symbol was changed to “KOAN” that more resembles the Company’s new business focus.



On May 22, 2020, Resonate
Blends, Inc. (the “Company”) entered into a Stock Purchase Agreement (the “SPA”) with Wais Asefi, Nick Miniello,
Juleon Asefi, and Curt Byers (collectively, the “Asefi Group”) to sell to the Asefi Group its subsidiary, Textmunication,
Inc., a California corporation (“Textmunication”). Textmunication operates the Company’s SMS business activities. The
Company will retain its cannabis operations based in Calabasas, California.



F-6









The consideration for
the sale of Textmunication consists of the cancellation by the Asefi Group of 4,822,029 shares of common stock (the “Shares”)
of the Company. The Shares have a market value of $337,542, based on our last sales price of $0.07 per share as of May 26, 2020. Upon
the cancellation of the Shares, the Company agreed to execute a general release in favor of Mr. Asefi.



Also on May 22, 2020,
the Company entered into a Separation and Release Agreement (the “Separation Agreement”) with Wais Asefi. Pursuant to the
Separation Agreement, Mr. Asefi agreed to separate from all officer positions and as a director of the Company and to further accept
the payment of $200,000 from the Company’s future fundraising as consideration of all debts outstanding under Mr. Asefi’s
employment agreement with the Company. Mr. Asefi further agreed to cancel his 4,000,000 shares of Series A Preferred Stock and to transfer
his 2,000,000 shares of Series C Preferred Stock to Geoffrey Selzer, the Company’s current CEO and Director. Mr. Asefi further
released the Company of all claims.



Also on May 22, 2020,
Mr. Selzer signed a Voting Agreement and agreed to vote his newly acquired 2,000,000 shares of Series C Preferred Stock in favor of the
sale of Textmunication to the Asefi Group.



On May 22, 2020, Resonate
Blends, Inc. (the “Company”) entered into a Stock Purchase Agreement (the “SPA”) with Wais Asefi, Nick Miniello,
Juleon Asefi, and Curt Byers (collectively, the “Asefi Group”) to sell to the Asefi Group its subsidiary, Textmunication,
Inc., a California corporation (“Textmunication”). Textmunication operates the Company’s SMS business activities.



On July 20, 2020, the
parties closed on the transactions contained in the SPA. The Asefi Group cancelled 4,755,209 shares of common stock (the “Shares”)
of the Company. The Shares have a market value of $332,842, based on our last sales price of $0.07 per share as of May 26, 2020. The
Company also executed a general release in favor of Mr. Asefi.



Basis of Presentation



Our financial statements
are presented in conformity with accounting principles generally accepted in the United States of America, as reported on our fiscal
years ending on December 31, 2021 and 2020. We have summarized our most significant accounting policies.



Going concern



These consolidated
financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which
contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. As of December
31, 2021, the Company has an accumulated deficit of $25,974,051.
The company’s ability to continue as a going concern is contingent upon the successful completion of additional financing arrangements
and its ability to achieve and maintain profitable operations. While the Company is expanding its best efforts to achieve the above plans,
there is no assurance that any such activity will generate funds that will be available for operations. These conditions raise substantial
doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial
statements. These consolidated financial statements do not include any adjustments that might arise from this uncertainty.



NOTE 2 – SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES



Cash



The Company considers
all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents.



The Company minimizes
its credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance
at times may exceed federally insured limits. On December 31, 2021 and 2020 no cash balances exceeded the federally insured limit.



F-7









Accounts receivable
and allowance for doubtful accounts



Accounts receivables
are stated at the amount management expects to collect. The Company generally does not require collateral to support customer receivables.
The Company provides an allowance for doubtful accounts based upon a review of the outstanding accounts receivable, historical collection
information and existing economic conditions. As of December 31, 2021, and 2020 there’s no allowance for doubtful accounts and
bad debts.



Revenue Recognition



TheCompany’s policy is that revenues will be recognized when control of the product is transferred
to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those services.



Results for reporting
periods beginning after January 1, 2020 are presented under Topic 606, while prior period amounts are not adjusted and continue to be
reported in accordance with our historic accounting under Topic 605. We did not have any cumulative impact as a result of applying Topic
606.



Fair Value of Financial
Instruments



The carrying amounts
reflected in the balance sheets for cash, accounts payable and accrued expenses approximate the respective fair values due to the short
maturities of these items.



As required by the
Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is measured based on a three-tier fair value hierarchy, which
prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets;
(Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable
inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.



The three levels of
the fair value hierarchy are described below:



Level 1: Unadjusted
quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities,



Level 2: Quoted prices
in markets that are not active, or inputs that is observable, either directly or indirectly, for substantially the full term of the asset
or liability,



Level 3: Prices or
valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little
or no market activity).



The fair value of the
accounts receivable, accounts payable, notes payable are considered short term in nature and therefore their value is considered fair
value.



Financial assets and
liabilities measured at fair value on a recurring basis are summarized below for the year ended December 31, 2021 and 2020:

SUMMARY OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON RECURRING BASIS

|                                 |  | Level 1 |   |  | Level 2 |   |   | Level 3 |  |   | Total     | 
|-------------------------------- |  | ------- | - |  | ------- | - | - | ------- |  | - | --------- | 
|Liabilities                      |  |         |   |  |         |   |   |         |  |   |           | 
|Derivative Financial Instruments |  | $       | — |  |         | $ | — |         |  | $ | 2,286,014 | 



F-8









Net income (loss)
per Common Share



Basic net income (loss)
per share is computed by dividing the net loss attributable to the common stockholders by the weighted average number of shares of common
stock outstanding during the period. Fully diluted loss per share is computed similar to basic loss per share except that the denominator
is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been
issued and if the additional common shares were dilutive.



Property and equipment



Property and equipment
are stated at cost, less accumulated depreciation provided on the straight-line method over the estimated useful lives of the assets,
which range from three to seven years. Expenditures for renewals or betterments are capitalized, and repairs and maintenance are charged
to expense as incurred the cost and accumulated depreciation of assets sold or otherwise disposed of are removed from the accounts, and
any gain or loss thereon is reflected in operations. Company policy capitalizes property and equipment for cost over $1,000, asset acquired
under $1,000 are charge to operations.



Income Taxes



Income taxes are computed
using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined
based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently
enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence,
are not expected to be realized. Because the Company has no net income, the tax benefit of the accumulated net loss has been fully offset
by an equal valuation allowance.



Use of Estimates



The preparation of
financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial
statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.



Stock-Based Compensation



The Company accounts
for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation – Stock Compensation
which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements
based on their fair values. The fair value of the equity instrument is charged directly to compensation expense and credited to additional
paid-in capital over the period during which services are rendered.



The Company follows
ASC Topic 505-50, formerly EITF 96-18, “Accounting for Equity Instruments that are Issued to Other than Employees for Acquiring,
or in Conjunction with Selling Goods and Services,” for stock options and warrants issued to consultants and other non-employees.
In accordance with ASC Topic 505-50, these stock options and warrants issued as compensation for services provided to the Company are
accounted for based upon the fair value of the services provided or the estimated fair market value of the option or warrant, whichever
can be more clearly determined. The fair value of the equity instrument is charged directly to compensation expense and additional paid-in
capital over the period during which services are rendered.



Advertising Expenses



Advertising
expenses are included in General and administrative expenses in the Statements of Operations and are expensed as incurred. The Company
incurred $611,914 and
$7,350 in
advertising expenses for the years ended December 31, 2021 and 2020, respectively.



F-9









Recent Accounting
Pronouncements



In January 2016, the
FASB issued ASU 2016-01, Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities.ASU 2016-01 addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments including
requirements to measure most equity investments at fair value with changes in fair value recognized in net income, to perform a qualitative
assessment of equity investments without readily determinable fair values, and to separately present financial assets and liabilities
by measurement category and by type of financial asset on the balance sheet or the accompanying notes to the financial statements. ASU
2016-01 will be effective for the Company beginning on January 1, 2018 and will be applied by means of a cumulative effect adjustment
to the balance sheet, except for effects related to equity securities without readily determinable values, which will be applied prospectively.
Management has reviewed this pronouncement and has determined that it would not have a material impact to the consolidated financial
statements.



In February 2016, the
FASB issued ASU 2016-02, Leases, which requires an entity to recognize long-term lease arrangements as assets and liabilities
on the balance sheet of the lessee. Under ASU 2016-02, a right-of-use asset and lease obligation will be recorded for all long-term leases,
whether operating or financing, while the income statement will reflect lease expense for operating leases and amortization/interest
expense for financing leases. The amendments also require certain new quantitative and qualitative disclosures regarding leasing arrangements.
ASU 2016-02 will be effective for the Company beginning on January 1, 2019. Lessees must apply a modified retrospective transition approach
for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements.
Early adoption is permitted. Management does not believe the adoption of ASU 2016-02 will have a material impact on the Company’s
consolidated financial statements.



In March 2016, the
FASB issued ASU 2016-05, Derivatives and Hedging: Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships,
which clarifies that a change in the counterparty to a derivative instrument that has been designated as a hedging instrument would not,
in and of itself, be considered a termination of the derivative instrument, provided that all other hedge accounting criteria continue
to be met. ASU 2016-05 is effective for the Company beginning on January 1, 2017. Early adoption is permitted, including in an interim
period. Management evaluated ASU 2016-05 and determined that the adoption of this new accounting standard did not have a material impact
on the Company’s consolidated financial statements.



In March 2016, the
FASB issued ASU 2016-06, Derivatives and Hedging (Topic 815): Contingent Put and Call Options in Debt Instruments, which aims to reduce
the diversity of practice in identifying embedded derivatives in debt instruments. ASU 2016-06 clarifies that the nature of an exercise
contingency is not subject to the “clearly and closely” criteria for purposes of assessing whether the call or put option
must be separated from the debt instrument and accounted for separately as a derivative. ASU 2016-06 is effective for the Company beginning
on January 1, 2017. Management evaluated ASU 2016-06 and determined that the adoption of this new accounting standard did not have a
material impact on the Company’s consolidated financial statements.



In March 2016, the
FASB issued ASU 2016-09, Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting.ASU 2016-09
simplifies several aspects of the accounting and presentation of share-based payment transactions, including the accounting for related
income taxes consequences and certain classifications within the statement of cash flows. ASU 2016-09 is effective for the Company beginning
on January 1, 2017. Management evaluated the impact of adopting ASU 2016-09 and determined that the new accounting standard did not have
a material impact on the Company’s consolidated financial statements.



In August 2016, the
FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments”
(“ASU 2016-15”). ASU 2016-15 will make eight targeted changes to how cash receipts and cash payments are presented and classified
in the statement of cash flows. ASU 2016-15 is effective for fiscal years beginning after December 15, 2017. The new standard will require
adoption on a retrospective basis unless it is impracticable to apply, in which case it would be required to apply the amendments prospectively
as of the earliest date practicable.



In November 2016, the
FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230)”, requiring that the statement of cash flows explain the change
in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. This guidance
is effective for fiscal years, and interim reporting periods therein, beginning after December 15, 2017 with early adoption permitted.
The provisions of this guidance are to be applied using a retrospective approach which requires application of the guidance for all periods
presented. Management has reviewed this pronouncement and has determined that it would not have a material impact to the consolidated
financial statements.



F-10









In May 2017, the FASB
issued ASU 2017-09, Compensation-Stock Compensation (Topic 718), Scope of Modification Accounting. The amendments in this Update provide
guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting
in Topic 718. The amendments in this Update are effective for all entities for annual periods, and interim periods within those annual
periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period, for (1) public business
entities for reporting periods for which financial statements have not yet been issued and (2) all other entities for reporting periods
for which financial statements have not yet been made available for issuance. Management has reviewed this pronouncement and has determined
that it would not have a material impact to the consolidated financial statements.



In July 2017, the Financial
Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-11, Earnings Per Share
(Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815). The amendments in Part I of this
Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features.
When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature
no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments
also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial
instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the
existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present
earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect
is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded
conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features
(in Subtopic 470-20, Debt—Debt with Conversion and Other Options), including related EPS guidance (in Topic 260). The amendments
in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending
content in the Codification, to a scope exception. Those amendments do not have an accounting effect. For public business entities, the
amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December
15, 2018. For all other entities, the amendments in Part I of this Update are effective for fiscal years beginning after December 15,
2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted for all entities, including
adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as
of the beginning of the fiscal year that includes that interim period.



NOTE 3 – RELATED
PARTY TRANSACTIONS



As of December 31,
2021, the Company completed the notes payable to a related party. On May 22, 2020, the Company entered into a Separation and Release
Agreement (the “Separation Agreement”) with Wais Asefi. Pursuant to the Separation Agreement, Mr. Asefi agreed to separate
from all officer positions and as a director of the Company and to further accept the payment of $200,000 from the Company’s future
fundraising as consideration of all debts outstanding under Mr. Asefi’s employment agreement with the Company. Mr. Asefi further
agreed to cancel his 4,000,000 shares of Series A Preferred Stock and to transfer his 2,000,000 shares of Series C Preferred Stock to
Geoffrey Selzer, the Company’s current CEO and Director. Mr. Asefi further released the Company of all claims.



On May 22, 2020, the
4,000,000 shares of Series A Preferred Stock were returned to the Company’s transfer agent and cancelled and on May 22, 2020 the
2,000,000 shares of Series C Preferred Stock were transferred to Mr. Selzer. The parties to the Separation Agreement agreed to a payment
schedule of $200,000 based on future monies raised by the Company - and not on a specific date – as follows:



| | ● | $12,500 when the initial $250,000 is raised by the Company;
| | - | -----------------------------------------------------------
| | ● | $12,500 when a total of $500,000 is raised by the Company; 



F-11









| | ● | $10,000 when a total of $750,000 is raised by the Company;      
| | - | ----------------------------------------------------------------
| | ● | $35,000 when a total of $1,750,000 is raised by the Company;    
| | ● | $35,000 when a total of $2,750,000 is raised by the Company;    
| | ● | $35,000 when a total of $3,750,000 is raised by the Company;    
| | ● | $35,000 when a total of $4,750,000 is raised by the Company; and
| | ● | $25,000 when a total of $5,750,000 is raised by the Company.    



On May 13, 2021, we
amended the Separation Agreement to state the parties desire to reduce the total amount payable to Wais Asefi from $200,000USD to $142,500USD. In addition to the earlier payments made to Mr. Asefi, a payment of $40,000was made on May 14, 2021 and another payment on June 27, 2021 for $40,000.
The final payment due on August 11, 2021 was for $25,000.
The final payment was made on August 11, 2021 and settled this agreement in full. Further under the amendment, Mr.
Asefi nominated Textmunication, Inc., our prior subsidiary, as the recipient of the funds due under the Separation Agreement.



The
outstanding balances as of December 31, 2021 and December 31, 2020 are $45,000and $187,500respectively.



NOTE 4 - CONVERTIBLE
NOTE PAYABLE



Convertible notes payable
consists of the following as of December 31, 2021 and December 31, 2020:

SCHEDULE OF CONVERTIBLE NOTES PAYABLE

|                             |  | December 31, 2021 |           |  | December 31, 2020 |  
|---------------------------- |  | ----------------- | --------- |  | ----------------- | -
|Convertible notes face value |  | $                 | 1,865,000 |  |                   | $
|Less: Discounts              |  |                   | -         |  |                   |  
|Less: Debt issuance cost     |  |                   | -         |  |                   |  
|Net convertible notes        |  | $                 | 1,865,000 |  |                   | $



The convertible notes
as of December 31, 2021 are 8% Unsecured Convertible Promissory Notes from various accredited investors issued from January 1, 2021 to
March 31, 2021 from the Company’s Reg D 506(c) private placement. All notes have a mandatory conversion into equity on the maturity
date, which is January 2, 2022, or at a Qualified Financing (QF) of $5,000,000, whichever occurs first. The maturity date conversion
pricing is the lesser of $.10 or 75% of the VWAP with a 20-day lookback. A QF converts into equity at the lesser of $1.00 or 75% of the
average selling price of the aggregate QF offering.



On December 28, 2021,
some of the accredited investors (“Investors”) offered to extend the maturity date on the Notes to July 3, 2022 (the “Extension
Period”). The interest shall accrue during the Extension Period at the rate of the Note pre default, and all other provisions in
the Note shall remain in full force and effect, except for the amended terms listed below.



Under the Note amendment,
all principal together with accrued and unpaid interest, will be automatically converted into shares of Common Stock at $.10, but Investors
will no longer have the option of the lesser of $0.10 and 75% of the volume weighted average closing price of the Common Stock for the
prior 20 trading day period. In exchange for the Extension Period, the Company shall add $2,500 for every $25,000 in principal on the
Note and the entire amount of principal and accrued interest shall be due at the end of the Extension Period.



As of December 31,
2021 and 2020 accrued interest payable on notes payable were $134,758.63 and $54,659 respectively.



The Company accounts
for the fair value of the conversion features of its convertible debt in accordance with ASC Topic No. 815-15 “Derivatives and
Hedging; Embedded Derivatives” (“Topic No. 815-15”). Topic No. 815-15 requires the Company to bifurcate and separately
account for the conversion features as an embedded derivative contained in the Company’s convertible debt. The Company is required
to carry the embedded derivative on its balance sheet at fair value and account for’ any unrealized change in fair value as a component
of results of operations. The Company values the embedded derivatives using the Black-Scholes pricing model.



F-12









NOTE 5 – COMMITMENTS
AND CONTINGENCIES



Office Lease



On October 16, 2019,
the Company signed a lease agreement that expires on thirty days’ notice. Rent expense was approximately $3,239 and $740 for the
years ended December 31, 2021 and 2020, respectively.



Executive
Employment Agreement



On
October 25, 2019 the Company entered into Employment Agreements with the following persons: (i) Geoffrey Selzer as Chief Executive Officer
(CEO) of the Company with an annual salary of $180,000; (ii) Pamela Kerwin as Chief Operating Officer (COO) of the Company with an annual
salary of $120,000; (iii) David Thielen as Chief Investment Officer (CIO) of the Company with an annual salary of $120,000. All are eligible
for salary increases upon milestone achievements and other benefits. The Employment Agreement for the CEO has a term of 2 years and can’t
be terminated without cause. Severance of six (6) weeks is available for termination of the COO and CIO without cause before one-year
of service and eight (8) weeks after one-year of service.



NOTE 6 – INCOME
TAXES



For the year ended
December 31, 2021, the cumulative net operating loss carry-forward from continuing operations is approximately $26,837,896 and will expire
beginning in the year 2030.



The cumulative tax
effect at the expected rate of 21% of significant items comprising our net deferred tax amount is as follows as of December 31, 2021
and 2020:

SCHEDULE OF DEFERRED TAX ASSETS



|Deferred tax attributable to: |  | 2021 |           |  | 2020 | 
|----------------------------- |  | ---- | --------- |  | ---- | 
|Net Operating loss carry over |  |      | 3,413,282 |  |      | 
|Valuation allowance           |  |      | 3,413,282 |  |      | 
|Net deferred tax assets       |  |      | -         |  |      | 



Due to the enactment
of the Tax Reform Act of 2017, the corporate tax rate for those tax years beginning with 2018 has been reduced to 21%.



Note 7 – STOCKHOLDERS’
EQUITY



The Company is authorized
to issue an aggregate of 200,000,000 shares of common stock with a par value of $0.0001. The Company is also authorized to issue 10,000,000
shares of “blank check” preferred stock with a par value of $0.0001.



Preferred Stock



The board of directors
of the Company has designated, out of the 10,000,000 shares of preferred stock authorized, the following series of preferred stock: 4,000,000
shares of Series A Preferred Stock, 66,667 shares of Series B Preferred Stock, 2,000,000 shares of Series C Preferred Stock, 40,000 shares
of Series D Preferred Stock and 10,000 shares of Series E Preferred Stock.



On October 25, 2019,
66,667 outstanding shares of Series B Preferred Stock was returned to the Company’s transfer agent and cancelled.



On December 9, 2019,
the Company exercised its right to redeem the 40,000 outstanding shares of Series D Preferred Stock by paying the holders $260,000 or
130% of the amount paid for the shares, as called for under the Securities Purchase Agreement.



F-13









On May 22, 2020, 4,000,000
outstanding shares of Series A Preferred Stock were returned to the Company’s transfer agent and cancelled,



There were 2,000,000
shares of Series C Preferred Stock issued and outstanding as of December 31, 2021. There are no other series of preferred stock outstanding
as of December 31, 2021.



Common Stock



During the year ended
December 31, 2018,



| | ● | the Company’s Board of Directors approved a one to
    one thousand (1:1000) reverse stock split, which became effective July 9, 2018. The Company consolidated financial statements have
    been retroactively restated to the reflect the effect of the stock split
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | ● | the Company entered into a subscription agreement for 9.98% of the
    company common shares outstanding for $100,000.                                                                                                                                                



During the year ended
December 31, 2018, the Company issued 1,380,933 shares of common stock with a fair value of $354,010 for the conversion of convertible
notes payable. The converted portion of the notes also had associated derivative liabilities with fair values on the date of conversion
of 866,361. The conversion of the derivative liabilities has been recorded through additional paid-in capital



During the first quarter
of 2019 the company issued a total of 6,685,000 shares to employees and vendors for compensation and services rendered. The fair market
value of the share issues accounted as expenses as follows:

SCHEDULE OF COMPENSATION AND SERVICES RENDERED

|                         |  |   |           | 
|------------------------ |  | - | --------- | 
|Management Fees          |  | $ | 2,074,600 | 
|Payment to subcontractor |  |   | 446,982   | 
|Total                    |  | $ | 2,521,582 | 



During the second quarter
of 2019 the company issued 40,000 shares of preferred stock warrants for $200,000 cash.



During the third quarter
of 2019 the company issued 1,280,000 common stocks in settlement of liabilities. The fair market value of the liabilities accounted as
additional paid in capital of $164,033.



During the year ended
December 31, 2019, we entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with the purchasers
identified therein (collectively, the “Purchasers”) providing for the issuance and sale to the Purchasers of an aggregate
of up to 40,000 shares of our Series D Convertible Preferred Stock (the “Preferred Shares”) and related warrants for gross
proceeds to the Company of $200,000. On December 9, 2019, we exercised our right to redeem the Preferred Shares by paying the Purchasers
$260,000 or 130% of the amount paid for the Preferred Shares, as called for under the Securities Purchase Agreement.



During the last quarter
year end December 31, 2019, the company issued 4,274,936 shares of common stocks to acquire Resonate Blends, LLC, and Entourage LLC,
both California limited liability companies. As a result of the transaction, both companies became wholly owned subsidiaries of the Company.
The Company recognized a loss of $834,022 on the acquisitions.



During the year ended
December 31, 2021 the company issued a total of 3,427,990 shares of common stock to management and vendors for compensation and services
rendered. The fair market value of the share issues accounted as expenses as follows:

Professional Fees
    $201,619Payment to obtain loan
    408,674Payment to management staff
    166,309Share
    issued accounted as expense
    776,603




F-14









NOTE 8 – DISCONTINUED
OPERATONS



On July 20, 2020, the
Company finalized a Stock Purchase Agreement (the “SPA”) with Wais Asefi, Nick Miniello, Juleon Asefi, and Curt Byers (collectively,
the “Asefi Group”) to sell to the Asefi Group its subsidiary, Textmunication, Inc., a California corporation (“Textmunication”).
Textmunication operates the Company’s SMS business activities. The Company retained its cannabis operations based in Calabasas,
California. The Company has accounted for this spinout as a discontinued operation and retroactively reclassified all previously presented
financial information. The following summarizes the results of operations for Textmunication, Inc.

SCHEDULE OF DISCONTINUED OPERATIONS

|                                               |  | 2020 |         |   | 2019 |  
|---------------------------------------------- |  | ---- | ------- | - | ---- | -
|Revenues                                       |  | $    | 477,734 |   |      | $
|                                               |  |      |         |   |      |  
|Cost of revenues                               |  |      | 101,347 |   |      |  
|Operating expenses                             |  |      | 468,815 |   |      |  
|                                               |  |      | 570,162 |   |      |  
|                                               |  |      |         |   |      |  
|Loss from operations of discontinued operation |  |      | (92,428 | ) |      |  
|Gain on disposal of discontinued operations    |  |      | 108,206 |   |      |  
|Gain (loss) from discontinued operations       |  | $    | 15,778  |   |      | $





NOTE 9 – SUBSEQUENT
EVENTS



On January 28, 2022,
we entered into Securities Purchase Agreements (the “Purchase Agreements”) with two accredited investors, pursuant to which
we issued and sold to the investors two convertible promissory notes, dated January 28, 20022, each in the principal amount of $275,000
for an aggregate principal amount of $550,000. We received $500,000 from the Notes after applying the original issue discount to the
Notes.



The Purchase Agreements
allow for additional notes to be issued to investors up to $750,000. On February 4, 2022, we issued and sold to two accredited investors
(the “Investors”) convertible promissory notes in the principal amount of $55,000 (the “Note”) under a Securities
Purchase Agreement of the same date. We received $150,000 from the Notes after applying the original issue discount to the Notes.



On March 3, 2022, we
issued and sold to an accredited investor a convertible promissory note the principal amount of $55,000 (the “Note”) under
a Securities Purchase Agreement of the same date. We received $50,000 from the Note after applying the original issue discount to the
Note.



The maturity date for
repayment of the Notes is nine months from issuance and the Notes bear interest at 10% per annum. We may prepay the Notes provided that
we shall make payment to the investors of an amount in cash equal to the sum of: the then outstanding principal amount of this Notes,
plus interest on the unpaid principal amount of the Notes, plus any Default Interest on the amounts, plus any amounts owed to the Investor
pursuant to the Purchase Agreement.



All principal and accrued
interest on the Notes are convertible into shares of our common stock. The conversion price shall equal a fixed price of $0.15 per share
or, at the option of the Investor in the event that we fail to complete a Qualified Offering before the five (5) month anniversary of
the issue date, the Registration Conversion Price. The “Registration Conversion Price” shall mean 75% multiplied by the volume
weighted average of the Common Stock during the twenty (20) Trading Day period ending on the latest complete Trading Day prior to the
Conversion Date. The Investors shall be entitled to add to the principal amount of the Note $750.00 for each conversion to cover investor’s
deposit fees associated with each Notice of Conversion. “Qualified Offering” means any offer and sale by us of an original
issuance of equity securities, comprised of either Common Stock or preferred stock of the Company, in a single transaction to investors
pursuant to which at least an aggregate of $2,000,000.00 gross proceeds are received by the Company.



In the event that by
the five (5) month anniversary of the issue date a Qualified Offering (as defined above) has not occurred, then we shall file with the
SEC a registration statement on Form S-1 covering the resale of the maximum number of Registrable Securities, defined as the Commitment
Shares, Conversion Shares and Warrant Shares.



In connection with
the investment, we issued Commitment Shares to the investor in the amount of 60,000 shares and we also issued a warrant (the “Warrant”)
to the Investor to purchase 62,500 shares of our common stock at an exercise price of $0.40 per share. In the event that there is no
effective registration statement five months from the issue date registering the shares underlying the Warrant, then the Investors may
exercise the Warrant using a cashless feature.



The Securities Purchase
Agreement contain a most favored nation provision that allows the Investor to claim any lower price from any future securities six months
after this closing and a blocker on issuing variable rate investments.



F-15











Item
9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure



None



Item
9A. Controls and Procedures



Evaluation
of Disclosure Controls and Procedures



As
required by Rule 13a-15 under the Securities Exchange Act of 1934, we have carried out an evaluation of the effectiveness of our disclosure
controls and procedures as of the end of the period covered by this annual report, being December 31, 2021. This evaluation was carried
out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer.



Disclosure
controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our
reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time
periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include controls
and procedures designed to ensure that information required to be disclosed in our company’s reports filed under the Securities
Exchange Act of 1934 is accumulated and communicated to management, including our Chief Executive Officer and Chief Investment Officer,
to allow timely decisions regarding required disclosure.



Based
upon that evaluation, including our Chief Executive Officer and Chief Investment Officer, we have concluded that our disclosure controls
and procedures were ineffective as of the end of the period covered by this annual report.



26







Management’s
Annual Report on Internal Control over Financing Reporting



Our
management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f)
under the Securities Exchange Act of 1934). Management has assessed the effectiveness of our internal control over financial reporting
as of December 31, 2021 based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission. As a result of this assessment, management concluded that, as of December 31, 2021, our internal
control over financial reporting was not effective. Our management identified the following material weaknesses in our internal control
over financial reporting, which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective
risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements
and application of both US GAAP and SEC guidelines.



We
plan to take steps to enhance and improve the design of our internal control over financial reporting. During the period covered by this
annual report on Form 10-K, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses,
we hope to implement the following changes during our fiscal year ending December 31, 2022: (i) appoint additional qualified personnel
to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures
for accounting and financial reporting. The remediation efforts set out in (i) and (ii) are largely dependent upon our securing additional
financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts
may be adversely affected in a material manner.



This
annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial
reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to an exemption
for non-accelerated filers set forth in Section 989G of the Dodd-Frank Wall Street Reform and Consumer Protection Act.



Item
9B. Other Information



None



Item
9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.



None



PART
III



Item
10. Directors, Executive Officers and Corporate Governance



The
following table sets forth the name and positions of our executive officer and director as of the date hereof.



|Name                |  | Age |  | Positions                                
|------------------- |  | --- |  | -----------------------------------------
|Geoffrey
    Selzer |  | 65  |  | Chairman
    and CEO                     
|Pamela
    Kerwin   |  | 73  |  | Chief
    Operating Officer              
|David
    Thielen   |  | 58  |  | Chief
    Investment Officer and Director



Set
forth below is a brief description of the background and business experience of our executive officer and director:



Geoffrey
Selzer – Chief Executive Officer and Chairman



Mr.
Selzer has built his career through over two decades of hands-on corporate finance, management, creative and production experience. Former
roles include CEO of Emergent Game Technologies, a video game software company, and the Creative Head of Disney Interactive’s edutainment
studio. Geoffrey is the founder of Resonate Blends and has a passion for building organizations and delivering results.



Mr.
Selzer does not hold and has not held over the past five years any other directorships in any company with a class of securities registered
pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act or any company registered
as an investment company under the Investment Company Act of 1940.



27







Pamela
Kerwin – Chief Operating Officer



Ms.
Kerwin has extensive senior management experience with both start-up and Fortune 500 companies. As the Vice President and General Manager
of Pixar Animation Studios, Pamela played a critical role in the company’s successful IPO and transition from a tech company to
a blockbuster studio. Pam is a company builder who specializes in identifying competitive advantages and executing successful marketing
strategies.



Ms.
Kerwin does not hold and has not held over the past five years any other directorships in any company with a class of securities registered
pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act or any company registered
as an investment company under the Investment Company Act of 1940.



David
Thielen – Chief Investment Officer and Board Member



Mr.
Thielen’s career includes roles in Management, Sales, Business Development, Start-ups and Strategy Management as Vice President,
COO and CEO. Prior to joining Textmunication Holdings, Inc. in 2017 as COO, he served as Area Vice President of DeRoyal, a global healthcare
manufacture doing $500 million in annual revenues. In 2014, he founded Aspire Consulting Group based in Washington, D.C., an IT Services
government system integrator that continues to operate as Veteran Owned company.



Mr.
Thielen does not hold and has not held over the past five years any other directorships in any company with a class of securities registered
pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act or any company registered
as an investment company under the Investment Company Act of 1940.



Term
of Office



Our
directors are elected to hold office until the next annual meeting of the shareholders and until their respective successors have been
elected and qualified. Our executive officers are appointed by our board of directors and hold office until removed by our board of directors
or until their successors are appointed.



Family
Relationships



There
are no family relationships between or among the directors, executive officers or persons nominated or chosen by us to become directors
or executive officers.



Significant
Employees



We
have no significant employees.



Involvement
in Certain Legal Proceedings



During
the past 10 years, none of our current directors, nominees for directors or current executive officers has been involved in any legal
proceeding identified in Item 401(f) of Regulation S-K, including:



1.
Any petition under the Federal bankruptcy laws or any state insolvency law filed by or against, or a receiver, fiscal agent or similar
officer was appointed by a court for the business or property of such person, or any partnership in which he or she was a general partner
at or within two years before the time of such filing, or any corporation or business association of which he or she was an executive
officer at or within two years before the time of such filing;



2.
Any conviction in a criminal proceeding or being named a subject of a pending criminal proceeding (excluding traffic violations and other
minor offenses);



28







3.
Being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining him or her from, or otherwise limiting, the following activities:



i.
Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage
transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing,
or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment
company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection
with such activity;



ii.
Engaging in any type of business practice; or



iii.
Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of
Federal or State securities laws or Federal commodities laws;



4.
Being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring,
suspending or otherwise limiting for more than 60 days the right of such person to engage in any type of business regulated by the Commodity
Futures Trading Commission, securities, investment, insurance or banking activities, or to be associated with persons engaged in any
such activity;



5.
Being found by a court of competent jurisdiction in a civil action or by the SEC to have violated any Federal or State securities law,
and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;



6.
Being found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any
Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently
reversed, suspended or vacated;



7.
Being subject to, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently
reversed, suspended or vacated, relating to an alleged violation of:



i.
Any Federal or State securities or commodities law or regulation; or



ii.
Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent
injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or
prohibition order; or



iii.
Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or



8.
Being subject to, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization
(as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of
the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary
authority over its members or persons associated with a member.



Audit
Committee



We
do not have a separately designated standing audit committee. The entire board of directors performs the functions of an audit committee,
but no written charter governs the actions of the board of directors when performing the functions of that would generally be performed
by an audit committee. The board of directors approves the selection of our independent accountants and meets and interacts with the
independent accountants to discuss issues related to financial reporting. In addition, the board of directors reviews the scope and results
of the audit with the independent accountants, reviews with management and the independent accountants our annual operating results,
considers the adequacy of our internal accounting procedures and considers other auditing and accounting matters including fees to be
paid to the independent auditor and the performance of the independent auditor.



29







We
do not have an audit committee financial expert because of the size of our company and our board of directors at this time. We believe
that we do not require an audit committee financial expert at this time because we retain outside consultants who possess these attributes
as needed.



For
the fiscal year ending December 31, 2021, the board of directors:



| | 1. | Reviewed
    and discussed the audited financial statements with management, and                                                                          
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------
| | 2. | Reviewed
    and discussed the written disclosures and the letter from our independent auditors on the matters relating to the auditor’s
    independence.



Based
upon the board of directors’ review and discussion of the matters above, the board of directors authorized inclusion of the audited
financial statements for the year ended December 31, 2021 to be included in this Annual Report on Form 10-K and filed with the Securities
and Exchange Commission.



Section
16(a) Beneficial Ownership Reporting Compliance



Section
16(a) of the Exchange Act requires our directors and executive officers and persons who beneficially own more than ten percent of a registered
class of the Company’s equity securities to file with the SEC initial reports of ownership and reports of changes in ownership
of common stock and other equity securities of the Company. Officers, directors and greater than ten percent beneficial shareholders
are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. To the best of our knowledge based solely
on a review of Forms 3, 4, and 5 (and any amendments thereof) received by us, no persons have failed to file, on a timely basis, the
identified reports required by Section 16(a) of the Exchange Act during fiscal year ended December 31, 2021.



Code
of Ethics



As
of December 31, 2021, we had not adopted a Code of Ethics. We feel that the small size of our board and management did not warrant the
adoption of a Code of Ethics.



Item
11. Executive Compensation



The
table below summarizes all compensation awarded to, earned by, or paid to our former or current executive officers for the fiscal years
ended December 31, 2021 and 2020.



|Name and principal position                  |  | Year |      |  | Salary
                                                                                ($) |   |         | Bonus
                                                                                ($) |  |  | Stock
                                                                                Awards
                                                                                ($) |  |  | Option
                                                                                Awards
                                                                                ($) |  |  | All Other
                                                                                Compensation
                                                                                ($) (1)(2) |  |  | Total
                                                                                ($) | 
|-------------------------------------------- |  | ---- | ---- |  | ------------------------------------------------------------------------------------------ | - | ------- | ----------------------------------------------------------------------------------------- |  |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | ----------------------------------------------------------------------------------------- | 
|Wais Asefi                                   |  |      | 2021 |  |                                                                                            | $ | 0       |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|Former President, Chairman, CEO and Director |  |      | 2020 |  |                                                                                            | $ | 92,250  |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|                                             |  |      |      |  |                                                                                            |   |         |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|Nick Miniello                                |  |      | 2021 |  |                                                                                            | $ | 0       |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|Former VP of Sales                           |  |      | 2020 |  |                                                                                            | $ | 70,350  |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|                                             |  |      |      |  |                                                                                            |   |         |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|Geoffrey Selzer                              |  |      | 2021 |  |                                                                                            | $ | 180,000 |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|CEO and Director                             |  |      | 2020 |  |                                                                                            | $ | 104,400 |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|                                             |  |      |      |  |                                                                                            |   |         |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|David Thielen                                |  |      | 2021 |  |                                                                                            | $ | 120,000 |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|CIO and Director                             |  |      | 2020 |  |                                                                                            | $ | 55,000  |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|                                             |  |      |      |  |                                                                                            |   |         |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|Pam Kerwin                                   |  |      | 2021 |  |                                                                                            | $ | 120,000 |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 
|Chief Operating Officer                      |  |      | 2020 |  |                                                                                            | $ | 55,000  |                                                                                           |  |  |                                                                                                                                                                                  |  |  |                                                                                                                                                                                   |  |  |                                                                                                                                                                                                   |  |  |                                                                                           | 



30







Narrative
to Summary Compensation Table



On
March 1, 2017, we appointed David Thielen as of Chief Operating Officer. We do not have an employment agreement with Mr. Thielen. He
was CEO of Aspire in which we used to own a 49% equity interest. We pay Mr. Thielen an annual salary of $60,000. On October 25, 2019,
Mr. Thielen resigned as COO of Textmunication and accepted a new role as Chief Investment Officer (CIO) and Director. Mr. Thielen has
an employment agreement and is paid $120,000 annually. He can also receive equity shares through assigned revenue and company milestones
set by the Board of Directors.



With
the merger of Resonate Blends LLC and Entourage Labs LLC on October 25, 2019, Mr. Selzer was announced as Chief Executive Officer of
the holding company. His annual salary is $180,000 and his team has 10% non-dilutive stock, with Mr. Selzer controlling 51% of this amount.
Mr. Selzer also has equity milestones in place for meeting preassigned revenue and market valuation goals.



Mr.
Selzer’s term of employment is for two years. He may request to terminate his employment contract and forfeit all benefits and
equity grants, if provided, with a 30-day notice. Should he terminate his employment before two years, he will forfeit the right to earn
any future milestone achievement benefits entirely regardless of how close the company may be to achieving them. At the end of his employment
term, an option to continue employment at an annual contract or at-will employment will be available if agreed upon by both parties.
The Company may not terminate his employment without Cause.



Ms.
Pamela Kerwin was announced as Chief Operating Officer of the holding company on October 25, 2019. Ms. Kerwin’s salary is $120,000
annually and she also participates in the 10% of non-dilutive stock of the holding company.



Her
term of employment is for two years. She may request to terminate her employment contract and forfeit all benefits and equity grants,
if provided, with a 30-day notice. Should she terminate her employment before two years, she will forfeit the right to earn any future
milestone achievement benefits entirely regardless of how close the company may be to achieving them. However, should a change of control
occur resulting in the sale of the business anytime within 9 months of termination, all milestone achievements shall be deemed accomplished
and all rights to the shares shall immediately vest prior to the close of such Change of Control event.



Outstanding
Equity Awards at Fiscal Year-End



The
table below summarizes all unexercised options, stock that has not vested, and equity incentive plan awards for each named executive
officers as of December 31, 2021.



|OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
|--------------------------------------------
|OPTION AWARDS                               
|Name                                        
|David Thielen                               
|Pam Kerwin                                  
|Geoffrey Selzer                             
|                                            



31







Item
12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.



SECURITY
OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS



The
following table sets forth, as of April 14, 2022, certain information as to shares of our common stock owned by (i) each person
known by us to beneficially own more than 5% of our outstanding common stock, (ii) each of our directors, and (iii) all of our executive
officers and directors as a group. Unless otherwise stated, the address for each beneficial owner is at 26565 Agoura Road, Suite 200
Calabasas, CA 91302.



|                                                            |  | Common Stock                                                                                           |           |  | Series C
                                                                                Preferred Stock | 
|----------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------ | --------- |  | -------------------------------------------------------------------------------------------------------- | 
|                                                            |  | Number of Shares
                                                                                Owned |           |  | Percent of
                                                                                Class(1)(2)   | 
|Geoffrey Selzer                                             |  |                                                                                                        | 1,406,112 |  |                                                                                                          | 
|David Thielen                                               |  |                                                                                                        | 1,765,667 |  |                                                                                                          | 
|Pam Kerwin                                                  |  |                                                                                                        | 880,895   |  |                                                                                                          | 
|All Directors and Executive Officers as a Group (3 persons) |  |                                                                                                        | 4,043,674 |  |                                                                                                          | 
|5% Holders                                                  |  |                                                                                                        |           |  |                                                                                                          | 
|Richard Hoge                                                |  |                                                                                                        | 5,198,640 |  |                                                                                                          | 



| | (1) | Pursuant
    to Rules 13d-3 and 13d-5 of the Exchange Act, beneficial ownership includes any shares as to which a shareholder has sole or shared
    voting power or investment power, and also any shares which the shareholder has the right to acquire within 60 days, including upon
    exercise of common shares purchase options or warrants.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | The
    percent of class is based on 47,796,859 shares of common stock outstanding and 2,000,000 shares of Series C Preferred Stock
    outstanding as of April 14, 2022.                                                                                                                                                                           



Item
13. Certain Relationships and Related Transactions, and Director Independence



Other
than described below or the transactions described under the heading “Executive Compensation” (or with respect to which such
information is omitted in accordance with SEC regulations), there have not been, and there is not currently proposed, any transaction
or series of similar transactions to which we were or will be a participant in which the amount involved exceeded or will exceed the
lesser of $120,000 or one percent of the average of our total assets at year-end for the last two completed fiscal years, and in which
any director, executive officer, holder of 5% or more of any class of our capital stock or any member of the immediate family of any
of the foregoing persons had or will have a direct or indirect material interest.



On
May 22, 2020, the Company entered into a Separation and Release Agreement (the “Separation Agreement”) with Wais Asefi. Pursuant
to the Separation Agreement, Mr. Asefi agreed to separate from all officer positions and as a director of the Company and to further
accept the payment of $200,000 from the Company’s future fundraising as consideration of all debts outstanding under Mr. Asefi’s
employment agreement with the Company. Mr. Asefi further agreed to cancel his 4,000,000 shares of Series A Preferred Stock and to transfer
his 2,000,000 shares of Series C Preferred Stock to Geoffrey Selzer, the Company’s current CEO and Director. Mr. Asefi further
released the Company of all claims.



32







On
May 22, 2020, the 4,000,000 shares of Series A Preferred Stock were returned to the Company’s transfer agent and cancelled and
on May 22, 2020 the 2,000,000 shares of Series C Preferred Stock were transferred to Mr. Selzer. The parties to the Separation Agreement
agreed to a payment schedule of $200,000 based on future monies raised by the Company - and not on a specific date – as follows:



| | ● | $12,500
    when the initial $250,000 is raised by the Company;
| | - | ---------------------------------------------------------------



| | ● | $12,500
    when a total of $500,000 is raised by the Company;
| | - | --------------------------------------------------------------



| | ● | $10,000
    when a total of $750,000 is raised by the Company;
| | - | --------------------------------------------------------------



| | ● | $35,000
    when a total of $1,750,000 is raised by the Company;
| | - | ----------------------------------------------------------------



| | ● | $35,000
    when a total of $2,750,000 is raised by the Company;
| | - | ----------------------------------------------------------------



| | ● | $35,000
    when a total of $3,750,000 is raised by the Company;
| | - | ----------------------------------------------------------------



| | ● | $35,000
    when a total of $4,750,000 is raised by the Company; and
| | - | --------------------------------------------------------------------



| | ● | $25,000
    when a total of $5,750,000 is raised by the Company.
| | - | ----------------------------------------------------------------



On
May 13, 2021, we amended the Separation Agreement to state the parties desire to reduce the total amount payable to Wais Asefi from $200,000
USD to $142,500 USD. In addition to the earlier payments made to Mr. Asefi, a payment of $40,000 was made on May 14, 2021 and another
payment on June 27, 2021 for $40,000. The final payment was made on August 11, 2021 for $25,000. The final payment on August 11, 2021
settled this agreement in full. Further under the amendment, Mr. Asefi nominated Textmunication, Inc., our prior subsidiary, as the recipient
of the funds due under the Separation Agreement. As of December 31, 2021, the Company made all of its required payments to Mr. Asefi.



The
outstanding balances as of December 31, 2021 and December 31, 2020 are $45,000 and $187,500 respectively.



Item
14. Principal Accounting Fees and Services



Below
are tables of Audit Fees (amounts in US$) billed by our auditors in connection with the audit of the Company’s annual financial
statements and review of the quarterly financial statements for the years ended:



Boyle
CPA, LLC



|Financial Statements for the
                                                 Year Ended December 31 |  | Audit Services |        |  | Audit
                                                                                 Related
                                                                                Fees |   |   | Tax Fees |  |   | Other Fees | 
|---------------------------------------------------------------------------------------------------- |  | -------------- | ------ |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | - | -------- |  | - | ---------- | 
|2020                                                                                                 |  | $              | 18,000 |  |                                                                                                                                                                                     | $ | - |          |  | $ | -          | 
|2021                                                                                                 |  | $              | 20,000 |  |                                                                                                                                                                                     | $ | - |          |  | $ | -          | 



33







PART
IV



Item
15. Exhibits, Financial Statements Schedules



| | (a) | Financial
    Statements and Schedules
| | --- | --------------------------------------



The
following financial statements and schedules listed below are included in this Form 10-K.

Financial
Statements (See Item 8)



| | (b)
    Exhibits
| | ----------------



|Exhibit
    Number |  | Description                                                                                                                                                                  
|------------------ |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.1                |  | Stock Purchase Agreement(1)                                                                                                                                                  
|2.2                |  | Membership
    Interest Purchase Agreement(2)                                                                                                                                
|2.3                |  | Membership
    Interest Purchase Agreement(2)                                                                                                                                
|2.4                |  | Agreement
    of Conveyance(2)                                                                                                                                               
|2.5                |  | Letter of Intent(11)                                                                                                                                                         
|3.1                |  | Articles
    of Incorporation(3)                                                                                                                                             
|3.2                |  | Certificate
    of Change(3)                                                                                                                                                 
|3.3                |  | Certificate
    of Amendment(4)                                                                                                                                              
|3.4                |  | Amendment
    to Certificate of Designation for Series C Preferred Stock(5)                                                                                                  
|3.5                |  | Certificate
    of Designation for Series E Preferred Stock(7)                                                                                                               
|3.6                |  | Certificate
    of Amendment(8)                                                                                                                                              
|3.7                |  | Bylaws,
    as amended(3)                                                                                                                                                    
|4.1                |  | Secured
    Convertible Promissory Note(6)                                                                                                                                   
|4.2                |  | 8%
    Unsecured Convertible Promissory Note(10)                                                                                                                             
|4.3                |  | Warrant(10)                                                                                                                                                                  
|4.4                |  | Warrant(10)                                                                                                                                                                  
|4.5                |  | Convertible
    Promissory Note(12)                                                                                                                                          
|4.6                |  | Convertible
    Promissory Note(12)                                                                                                                                          
|4.7                |  | Common
    Stock Purchase Warrant(12)                                                                                                                                        
|4.8                |  | Common
    Stock Purchase Warrant(12)                                                                                                                                        
|4.9                |  | Convertible
    Promissory Note(13)                                                                                                                                          
|4.10               |  | Convertible
    Promissory Note(13)                                                                                                                                          
|4.11               |  | Common
    Stock Purchase Warrant(13)                                                                                                                                        
|4.12               |  | Common
    Stock Purchase Warrant(13)                                                                                                                                        
|4.13               |  | Convertible Promissory Note(14)                                                                                                                                              
|4.14               |  | Common Stock Purchase Warrant(14)                                                                                                                                            
|10.1               |  | Separation
    Agreement and Release(1)                                                                                                                                      
|10.2               |  | Voting
    Agreement(1)                                                                                                                                                      
|10.3               |  | Employment
    Agreement(2)                                                                                                                                                  
|10.4               |  | Employment
    Agreement(2)                                                                                                                                                  
|10.5               |  | Securities
    Purchase Agreement(6)                                                                                                                                         
|10.6               |  | Addendum
    to Securities Purchase Agreement(9)                                                                                                                             
|10.7               |  | Securities
    Purchase Agreement(12)                                                                                                                                        
|10.7               |  | Securities
    Purchase Agreement(12)                                                                                                                                        
|31.1               |  | Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002  
|31.2               |  | Certification of Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002  
|32.1               |  | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|                   |  |                                                                                                                                                                              
|101.INS            |  | Inline
    XBRL Instance Document                                                                                                                                            
|101.SCH            |  | Inline
    XBRL Taxonomy Extension Schema Document                                                                                                                           
|101.CAL            |  | Inline
    XBRL Taxonomy Extension Calculation Linkbase Document                                                                                                             
|101.DEF            |  | Inline
    XBRL Taxonomy Extension Definition Linkbase Document                                                                                                              
|101.LAB            |  | Inline
    XBRL Taxonomy Extension Label Linkbase Document                                                                                                                   
|101.PRE            |  | Inline
    XBRL Taxonomy Extension Presentation Linkbase Document                                                                                                            
|104                |  | Cover
    Page Interactive Data File (embedded within the Inline XBRL document)                                                                                              



| | 1  | Incorporated
    by reference to the Current Report on Form 8-K filed on July 20, 2020.       
| | -- | ----------------------------------------------------------------------------------------------
| | 2  | Incorporated
    by reference to the Current Report on Form 8-K filed on October 31, 2019.    
| | 3  | Incorporated
    by reference to the Registration Statement on Form S-1 filed on June 6, 2014.
| | 4  | Incorporated
    by reference to the Quarterly Report on Form 10-Q filed on November 23, 2020.
| | 5  | Incorporated
    by reference to the Current Report on Form 8-K filed on May 21, 2019.        
| | 6  | Incorporated
    by reference to the Current Report on Form 8-K filed on July 23, 2020.       
| | 7  | Incorporated
    by reference to the Current Report on Form 8-K filed on August 10, 2020.     
| | 8  | Incorporated
    by reference to the Quarterly Report on Form 10-Q filed on August 14, 2020.  
| | 9  | Incorporated
    by reference to the Current Report on Form 8-K filed on September 21, 2020.  
| | 10 | Incorporated
    by reference to the Current Report on Form 8-K filed on March 18, 2021.      
| | 11 | Incorporated
    by reference to the Current Report on Form 8-K filed on September 13, 2021.  
| | 12 | Incorporated
    by reference to the Current Report on Form 8-K filed on February 3, 2022.    
| | 13 | Incorporated
    by reference to the Current Report on Form 8-K filed on February 10, 2022.   
| | 14 | Incorporated by reference to the Current Report on Form 8-K filed on March
    8, 2022.       



Item
16. Form 10-K Summary



None.



34







SIGNATURES



Pursuant
to the requirements of Section 13 or 15(d) of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.



|Resonate Blends, Inc. |                                                                                                                                                                                                                                         
|--------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                      |                                                                                                                                                                                                                                         
|By:                   | /s/
    Geoffrey Selzer                                                                                                                                                                                                                 
|                      | Geoffrey
                                            Selzer
    President,
    Chief Executive Officer, Principal Executive Officer, Chief Financial Officer, Principal Financial Officer, Principal Accounting
    Officer and Director
|                      |                                                                                                                                                                                                                                         
|                      | April
    15,2022                                                                                                                                                                                                                       



Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.



|By: | /s/
    Geoffrey Selzer                                                                                                                                                                                                                                                            | 
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|    | Geoffrey
    Selzer                                                                                                                                                                                                                                                                | 
|    | President,
                                                         Chief Executive Officer, Principal Executive Officer, Chief Financial Officer, Principal Financial Officer, Principal Accounting
                                                         Officer and Director | 
|    |                                                                                                                                                                                                                                                                                    | 
|    | April
    15,2022                                                                                                                                                                                                                                                                  | 
|    |                                                                                                                                                                                                                                                                                    | 
|By: | /s/
    David Thielen                                                                                                                                                                                                                                                              | 
|    | David                                                                                                                                                                                                                                                                              | 
|    | Chief
    Investment Officer and Director                                                                                                                                                                                                                                          | 
|    |                                                                                                                                                                                                                                                                                    | 
|    | April
    15,2022                                                                                                                                                                                                                                                                  | 



35