EDGAR 10-K Filing

Company CIK: 1409999
Filing Year: 2023
Filename: 1409999_10-K_2023_0001477932-23-001598.json

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ITEM 1. BUSINESS
Item 1. Business
In this Annual Report, “we,” “us” and “our” refer to Black Bird Biotech, Inc., including its wholly-owned subsidiaries, Black Bird Potentials Inc., a Wyoming corporation (“BB Potentials”), Big Sky American Dist., LLC, a Montana limited liability company (“Big Sky American”), and Black Bird Hemp Manager, LLC, a Montana limited liability company.
Preliminary Statements Regarding the COVID-19 Pandemic
The COVID-19 pandemic had a discernable short-term negative impact on the ability of our company to obtain capital needed to accelerate the development of our business, as well as to obtain needed inventory, due to supply chain delays. While these limitations have eased, we are unable to predict when such limitations will be entirely resolved.
Overall, our company is not of a size that required us to implement “company-wide” policies in response to the COVID-19 pandemic. Further, our product manufacturing operations have experienced no negative consequences attributable to the COVID-19 pandemic, inasmuch as these operations involve a limited number of persons.
For purposes of the discussion below, except where otherwise indicated, the descriptions of our business, our strategies, our risk factors and any other forward-looking statements, including regarding us, our business and the market generally, do not reflect the impact of the COVID-19 pandemic or our responses thereto.
Our Company After Acquiring Black Bird Potentials Inc.
With the January 2020 acquisition of Black Bird Potentials Inc. (BB Potentials), our company emerged from its long-standing status as a “shell company.” Our Board of Directors has adopted the business plan of BB Potentials and our company’s ongoing operations now include those of BB Potentials.
Developments
In March 2022, our company launched the first major initiative in marketing our MiteXstream biopesticide on a national basis, when we entered into a consulting agreement with Spire+, a Cornelius, North Carolina-based leading sales and marketing agency that specializes in brand building, marketing, communications and business development. Spire+ has begun work to implement a comprehensive go-to-market strategy for MiteXstream, including e-commerce, traditional retail and a category-specific distribution model. Spire+, an affiliate of Spire Sports + Entertainment, LLC, has a long history of building and executing successful sales and marketing programs for brands, such as Toyota, 5-hour ENERGY, Auto-Owners Insurance, ENEOS Motor Oil, Petro-Canada, STP and Parker Hannifin.
Business Overview
MiteXstream. BB Potentials is the exclusive worldwide manufacturer and distributor of MiteXstream, an EPA-registered plant-based biopesticide effective in the eradication of mites and similar pests, including spider mites, a pest that destroys crops, especially cannabis, hops, coffee, and house plants, as well as molds and mildew.
CBD and Other Products. Through BB Potentials, we manufacture and sell CBD products, including CBD Oils, gummies and pet treats, and CBD-infused personal care products, under the Grizzly Creek Naturals brand name. Big Sky American currently distributes an array of consumer products, including the Grizzly Creek Naturals products, to retail locations in Western Montana.
MiteXstream
Worldwide Exclusivity. At the present time, our future success is primarily dependent upon our ability to achieve market penetration of MiteXstream.
Pursuant to a February 2021 Manufacturing, Sales and Distribution License Agreement (the “New MiteXstream Agreement”) with Touchstone Enviro Solutions, Inc. (“Touchstone”), a company owned by three of our directors, Fabian G. Deneault, L. A. Newlan, Jr. and Eric Newlan, BB Potentials possesses the exclusive rights, even as to Touchstone, to manufacture, sell and distribute MiteXstream, an EPA-registered biopesticide (EPA Reg. No. 95366-1). The exclusivity granted would be reduced to a status of non-exclusivity, should we fail to manufacture at least 2,500 gallons of concentrate in any year during the term of the New MiteXstream Agreement; provided, however, that such minimum required is deemed to have been satisfied through December 31, 2022. We are required to pay Touchstone a royalty of $10 per gallon of MiteXstream manufactured by us or by any sublicensee of ours. For no further consideration, we were granted the rights to use the “MiteXstream” trademark and the “Harnessing the Power of Water” trademark.
The New MiteXstream Agreement replaced a prior similar agreement with Touchstone (the “Original MiteXstream Agreement”) and served to expand our company’s rights with respect to MiteXstream. The New MiteXstream Agreement contains the following important provisions as compared to the Original MiteXstream Agreement:
New MiteXstream Agreement
Original MiteXstream Agreement
Term
December 31, 2080
Initial terms of 10 years, with one 10-year renewal term
Territory
Worldwide Exclusive (1)
United States and Canada
Royalty
$10.00 per gallon manufactured
Effective royalty of an estimated $50 per gallon
Minimums
2,500 gallons of concentrate manufactured per year (2)
$20,000 of product per year
Sublicensing
Right to sublicense granted
No right to sublicense
Trademarks
For no extra consideration, rights granted to use “MiteXstream” and “Harnessing the Power of Water”
For no extra consideration, rights granted to use “MiteXstream”
(1)
Exclusivity ends and becomes non-exclusive, if the minimum of 2,500 gallons per year is not met.
(2)
The minimum (2,500 gallons per year) is deemed to have been satisfied through December 31, 2022.
The disinterested Directors of our Company approved the New MiteXstream Agreement.
Approval as Biopesticide. Effective December 16, 2020, MiteXstream was approved as a biopesticide by the U.S. Environmental Protection Agency (EPA Reg. No. 95366-1). MiteXstream has been approved for sale in 44 states, with applications pending in the remaining states, except for California, the application for which is in the final stage of preparation. In addition, we intend to seek approval of MiteXstream in countries around the world, although no specific time for such actions has been set.
Sales and Distribution.
Online. We sell MiteXstream directly to customers though our website, MiteXstream.com. Our marketing efforts during the remainder of 2022 will be centered around driving customer traffic to the website for purchases MiteXstream, as well as to our Amazon page. Spire+ is focused on these efforts.
Spire+. In March 2022, our company launched the first major initiative in marketing our MiteXstream biopesticide on a national basis, when we entered into a consulting agreement with Spire+, a Cornelius, North Carolina-based leading sales and marketing agency that specializes in brand building, marketing, communications and business development. Spire+ has begun work to implement a comprehensive go-to-market strategy for MiteXstream, including e-commerce, traditional retail and a category-specific distribution model. Spire+, an affiliate of Spire Sports + Entertainment, LLC, has a long history of building and executing successful sales and marketing programs for brands, such as Toyota, 5-hour ENERGY, Auto-Owners Insurance, ENEOS Motor Oil, Petro-Canada, STP and Parker Hannifin.
Other Opportunities. In March 2021, we entered into a distribution agreement with IFC Fulfillment Company (“IFC”), a Los Angeles-based export firm, whereby IFC was appointed the exclusive distributor for MiteXstream in China, Hong Kong and Taiwan. One of our Directors, Jack Jie Qin, facilitated the signing of the IFC Agreement. As of the date of this Annual Report, IFC has not made a sale of MiteXstream.
The Genesis of MiteXstream. Our President, Fabian G. Deneault, was, from 2017 through 2019, a licensed dispenser of medical marijuana (MMJ) in the State of Montana and, as such, was permitted to grow marijuana plants for use in his MMJ dispensary business. As a licensed medical marijuana grower, Mr. Deneault encountered infestations of spider mites on his plants. To combat the spider mites, Mr. Deneault developed the MiteXstream formulation (see “Product Effectiveness” below).
Mr. Deneault soon came to understand that the spider mite issue is a cannabis-industry-wide issue. In fact, all types of mites and similar pests are a significant pest in the production of a wide array of agricultural crops worldwide, including coffee, hops and strawberries, among other agricultural crops.
Product Effectiveness and Independent Testing. In original testing done by our company, we determined that, when mixed with water at the prescribed dilution rate, MiteXstream is effective in eliminating mites, including spider mites, and similar pests and their eggs, with no risk of plant damage. Additionally, MiteXstream eliminates molds and mildews on all types of plants.
Honey Bee Testing - Contact Toxicity and Oral Toxicity. Independent lab testing has proven MiteXstreamTM to be “NOT TOXIC” to honey bees when contacted topically or when ingested.
Performing Lab:
STILLMEADOW, Inc., Sugar Land, Texas.
Study Director:
Cole Younger, PhD., Entomologist, STILLMEADOW, Inc.
MiteXstream: Honey bee, Apis mellifera,
Acute Contact Toxicity Limit Test
MiteXstream: Honey Bee, Apis mellifera,
Acute Oral Toxicity Limit Test
Conclusion: With a mortality of 0% after 48 hours, MiteXstream was non-toxic when administered by contact to honey bees.
Conclusion: With a mortality of 0% after 48 hours, MiteXstream was non-toxic when ingested by honey bees.
BRIM Efficacy Testing. In February 2022, British Columbia, Canada-based laboratory Botanical Research in Motion (BRIM) published its Efficacy Testing Report on MiteXstream. The BRIM Report was authored by Dr. Fawzia Afreen, who, in addition to holding three international patents, publishing over 40 articles in peer-reviewed international journals and publishing two books, possesses nearly 20 years of experience in plant horticulture, plant tissue culture and plant production.
The BRIM Report, entitled “MiteXstream - a new, safe, environmentally friendly and the most effective biopesticide for controlling pests in Cannabis,” details the extensive testing procedures undertaken and ends with the following summary assessment:
“To summarize, the major findings of the study are: MiteXstream biopesticide can be a safe alternative of chemical pesticides and to achieve the maximum benefit the use of full-strength full strength concentration without any addition of surfactant is recommended. It can effectively control or eradicate the spider mites and powdery mildew as well as work as a preventative measure when applied at the appropriate dose, time, and stage. The use of MiteXstream is not limited to Cannabis it can be used to control pest infestation in a wide range of plants.”
Cannabis-Specific Independent Lab Testing. Based on independent lab testing, users of MiteXstream are able to treat their cannabis (marijuana) plants through the day of harvest and still satisfy state-level pesticide testing standards.
In January 2019, Stillwater Labs, an Olney, Montana-based medical marijuana testing facility, concluded its testing of a cannabis sample treated only with MiteXstream. In addition to testing for pesticides prohibited by the State of Montana, Stillwater Labs also tested for pesticides prohibited by the State of Oregon, the most stringent state-level marijuana testing standard. The results of this testing, presented as being measured in parts per billion (PPB), are set forth below.
Montana Pesticide Testing Standard
Analyte
Montana
Allowable
Limit (PPB)
MiteXstream
Treated
Sample (PPB)
Analyte
Montana
Allowable
Limit (PPB)
MiteXstream
Treated
Sample (PPB)
Abamectin
Imidacloprid
Acequinocy
Myclobutanil
Bifenazate
Paclobutrazol
Bifenthrin
Pyrethrin I
Chlormequat Chloride
Spinosyn A
Cyfluthrin
Spinosyn D
Daminozide
Spiromefesin
Etoxazole
Spirotetramat
Fenoxycarb
Trifloxystrobin
Imazalil
Oregon Pesticide Testing Standard
Analyte
Oregon
Allowable
Limit (PPB)
MiteXstream
Treated
Sample (PPB)
Analyte
Oregon
Allowable
Limit (PPB)
MiteXstream
Treated
Sample (PPB)
Abamectin
Clofentezine
Acequinocy
Cypermethrin
Bifenazate
Diazinon
Bifenthrin
Dichlorvos
Chlormequat Chloride
Dimethoate
Cyfluthrin
Etofenprox
Daminozide
Fenpyroximate
Etoxazole
Fipronil
Fenoxycarb
Flonicamid
Imazalil
Fludioxonil
Imidacloprid
Hexythiazox
Myclobutanil
Kresoxym-methyl
Paclobutrazol
Malathion
Pyrethrin I
Metalaxyl
Spinosyn A
Methomyl
Spinosyn D
Methiocarb
Spiromefesin
Oxamyl
Spirotetramat
Permethrins
Trifloxystrobin
Phosmet
Acephate
Piperonyl Butoxide
Acetamiprid
Prallethrin
Aldicarb
Propiconazole
Azoxystrobin
Pyridaben
Boscalid
Spiroxamine
Carbaryl
Tebuconazole
Carbofuran
Thiacloprid
Chloantraniliprole
Thiamethoxam
Chlorpyrifos
* Noted in the report of Stillwater Labs as possible ambient environmental contamination.
Competition. The pesticide industry is characterized by severe competition, evolving industry standards, evolving business and distribution models, price cutting, with resulting downward pressure on gross margins, and price sensitivity on the part of customers. Many of our competitors possess substantially greater resources, financial and otherwise, than does our company. In addition, MiteXstream lacks name recognition. Our future success will depend on our ability to gain product name recognition and customer loyalty, as well as our being able to anticipate and respond to emerging standards and other unforeseen changes. If we fail to satisfy such standards of operation, our operating results could suffer. Further, intra-industry consolidations may result in stronger competitors and may, therefore, also harm our future results of operations. There is no assurance that we will ever overcome these challenges.
Regulation. Field testing, production and marketing of pesticide products are regulated by federal, state, local and foreign governments. The EPA regulates pesticides in the U.S. under the Federal Insecticide, Fungicide and Rodenticide Act, as amended (“FIFRA”). Pesticides also are regulated by the states. MiteXstream is registered under FIFRA and, prior to sale in any state, will be approved by such state.
CBD and Other Products
CBD Products. We have created “Grizzly Creek Naturals” as the brand name for our CBD-related products, which are manufactured by our company using CBD purchased from third parties. Our line of Grizzly Creek Naturals CBD products are currently manufactured by BB Potentials. The Grizzly Creek Naturals product line includes CBD Oils, CBD Body Butter, CBD Lip Balm, CBD Sports Roll-on and CBD Bath Bombs. In addition, we sell CBD gummies on a private-label basis.
Other Products. Since Big Sky American started its distribution efforts, we have distributed a wide array of non-CBD consumer items to retail locations in Western Montana. These products include food items, clothing items and items associated with outdoor activities.
During the COVID-19 pandemic, we began the manufacture and sale of our Grizzly Creek Naturals hand sanitizer to distributors, directly to retail customers and directly to consumers through our website, after completed our FDA product listing in March 2020. We determined recently to cease the production of our hand sanitizer products.
Distribution.
In-House Distribution. Since it began to manufacture and sell its CBD products in mid-2019, BB Potentials has self-distributed its products. In December 2020, these distribution efforts we formalized with the formation of Big Sky American. Big Sky American currently distributes an array of consumer products, including the Grizzly Creek Naturals CBD products, to retail locations in Western Montana. In December 2020, Big Sky American entered into an asset purchase agreement (the “Big Sky APA”), whereby it purchased certain distribution-related assets associated with approximately 200 retail locations in Western Montana for $200,000 in cash. These assets became available for purchase, due their owner’s determination to terminate its distribution business in such locations. The closing of under the Big Sky APA occurred in February 2021.
Online. Our Grizzly Creek Naturals products are sold to consumers through our website, GrizzlyCreekNaturals.com.
Third-Party Distributors. In 2020, we entered into a letter agreement with Las Vegas, Nevada-based Hope Botanicals LLC (the “Hope Distributor”), with respect to its selling our products primarily in the Las Vegas area and the Hope Distributor continues to purchase small amounts of products from us.
We continue to seek additional distributors who are able to demonstrate, to our management’s satisfaction, an ability to develop sales for our Grizzly Creek Naturals CBD products.
Perceived Benefits of CBD. The recent growth in sales of CBD products is primarily due to perceived benefits expressed by those who have used CBD products. While our company does not make any claims as to the effectiveness or potential benefits of CBD, the following perceived benefits expressed by those who have used CBD products include, among others:
• Relief for Chronic Pain
• Reduces Seizures
• Reduces Anxiety and Depression
• Reduces Inflammation
• Promotes Healthy Weight
• Improves Heart Health
• Improves Skin Conditions
(Source: CBD Oil Benefits and Uses for Pain, Anxiety, Cancer and More,
Dr. Josh Axe, DC, DMN, CNS; https://draxe.com/cbd-oil-benefits)
Competitive Strengths and Weaknesses. With respect to our Grizzly Creek Naturals products, we believe our company possesses the following competitive strengths and weaknesses:
Competitive Strengths:
• our products are produced using high-quality ingredients
• we enjoy low overhead costs
Competitive Weaknesses:
• none of our products enjoys brand name recognition
• we possess limited capital
• we have limited personnel
Competition. The competition for customers in the CBD market is highly competitive and highly fragmented, with no significant barriers to entry. We expect competitive conditions to increase over time. There is no assurance that our Grizzly Creek Naturals CBD products will achieve profitability in the face of such competition.
Regulation. Under the 2018 Farm Bill, CBD products may be sold legally, if and only if the hemp from which the CBD is derived is produced in a manner consistent with the 2018 Farm Bill, associated federal regulations, associated state regulations and by a licensed grower. Our CBD products are in compliance with the provisions of the 2018 Farm Bill.
Industrial Hemp-Related Activities
In 2020, we formed a division of our company that was to focus on industrial hemp-related business opportunities under the “Black Bird American Hemp” brand name. During 2020 and early 2021, Black Bird American Hemp sought to develop industrial hemp processing operations in the State of Montana. However, during 2021, our management determined that market conditions, especially as it relates to attracting investors, related to the industrial hemp industry had waned, and we suspended our industrial hemp activities for the foreseeable future.
During 2020 and 2021, BB Potentials was a licensed hemp grower in Montana under the Montana Hemp Pilot Program. BB Potentials did not grow commercial quantities of hemp during either year. No 2022 application for a license was submitted by BB Potentials and we do not intend to submit and application during 2023.
Insurance
We have not yet purchased product liability or other insurance. However, our management intends to secure a commercially reasonable product liability insurance policy in March 2023.
Intellectual Property
In General. We regard our rights to intellectual property pertaining to “MiteXstream” and “Grizzly Creek Naturals” and our business know-how as having significant value and as being an important factor in the marketing of our products. Our policy is to establish, enforce and protect our intellectual property rights using the intellectual property laws.
Patents. Currently, we own no interest in any patent or patent application. None of the products that we sell in our business is the subject of any patent or patent application. Due to such lack of patent protection, neither our company nor our licensor may be able to defend our or its rights to such intellectual property.
Trademarks. We are the owner of the “Grizzly Creek Naturals” and “Black Bird American Hemp” trademarks and have the exclusive right to the use of the “MiteXstream” trademark. In addition, we have the right to use the “Harnessing the Power of Water” trademark, in associated with MiteXstream. We have filed a trademark application with the U.S. Patent and Trademark Office with respect to “MiteXstream.” It is intended that, in the near future, filings for the registration of our other trademarks will be made with the U.S. Patent and Trademark Office will be made.
Property
From 2014 through May 2020, our current Director and former CEO, Jack Jie Qin, provided office space to our company at no cost.
In May 2020, BB Potentials entered into a facility lease with Grizzly Creek Farms, LLC, an entity owned by one our Directors, Fabian G. Deneault, with respect to approximately 2,000 square feet of manufacturing space located in Ronan, Montana. Monthly rent under such lease was $1,500 and the initial term of such lease expired in December 2025. This lease was terminated effective April 1, 2021. Since such date, Mr. Deneault permits BB Potentials to utilize the previously-leased facility for storage, at no charge.
The following sets forth information concerning the sole operating lease for the facility maintained by us as of the date of this Annual Report.
Address
Description
Use
Yearly Rent
Expiration Date
11961 Hilltop Road
Building 7 - Suite 22
Argyle, Texas 76226
Office/Warehouse
(1,500 sq. ft.)
Administrative/
Warehousing
$8,700 *
January 31, 2025
*
We are co-lessees under the lease agreement by which we rent this facility. Our co-lessee is Petro X Solutions, Inc., a wholly-owned subsidiary of Accredited Solutions, Inc., a publicly-traded company (symbol: GHMP), an affiliate our company. By agreement with Petro X Solutions, we are each responsible for 50% of the rent and all tenancy-related expenses. However, should Petro X Solutions default in its rent obligations, our company would be responsible for paying the entire monthly rental amount of $1,450.
We own no real property.
Employees
We currently have four employees, in addition to our current executive officers. Upon our obtaining adequate funding, we expect that we would hire a small number of additional employees. We have used, and, in the future, expect to use, the services of certain outside consultants and advisors as needed on a consulting basis.

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ITEM 1A. RISK FACTORS
Item 1A. Risk Factors
Not applicable to a smaller reporting company.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
Item 1B. Unresolved Staff Comments
Not applicable to a smaller reporting company.

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ITEM 2. PROPERTIES
Item 2. Properties
In May 2020, BB Potentials entered into a facility lease with Grizzly Creek Farms, LLC, an entity owned by one our Directors, Fabian G. Deneault, with respect to approximately 2,000 square feet of manufacturing space located in Ronan, Montana. Monthly rent under such lease was $1,500 and the initial term of such lease expired in December 2025. This lease was terminated effective April 1, 2021. Since such date, Mr. Deneault permits BB Potentials to utilize the previously-leased facility for storage, at no charge.
The following sets forth information concerning the sole operating lease for the facility maintained by us as of the date of this Annual Report.
Address
Description
Use
Yearly Rent
Expiration Date
11961 Hilltop Road
Building 7 - Suite 22
Argyle, Texas 76226
Office/Warehouse
(1,500 sq. ft.)
Administrative/ Warehousing
$8,700 *
January 31, 2025
*
We are co-lessees under the lease agreement by which we rent this facility. Our co-lessee is Petro X Solutions, Inc., a wholly-owned subsidiary of Accredited Solutions, Inc., a publicly-traded company (symbol: GHMP), an affiliate our company. By agreement with Petro X Solutions, we are each responsible for 50% of the rent and all tenancy-related expenses. However, should Petro X Solutions default in its rent obligations, our company would be responsible for paying the entire monthly rental amount of $1,450.
We own no real property.

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ITEM 3. LEGAL PROCEEDINGS
Item 3. Legal Proceedings
We have no pending legal or administrative proceedings.

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ITEM 4. MINE SAFETY DISCLOSURE
Item 4. Mine Safety Disclosures
Not applicable.
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information
Our common stock is currently quoted on the OTC PINK tier of the OTC Markets under the symbol “BBBT.” Trading in OTC PINK stocks can be volatile, sporadic and risky, as thinly traded stocks tend to move more rapidly in price than more liquid securities. Such trading may also depress the market price of our common stock and make it difficult for our stockholders to resell their common stock.
The following table reflects the high and low closing price for our common stock for the periods indicated. The information was obtained from the OTC Markets Group, Inc. and reflects inter-dealer prices, without retail mark-up, markdown or commission, and may not necessarily represent actual transactions.
Year Ended December 31, 2022
March 31, 2022
$ 0.0145
$ 0.0136
June 30, 2022
$ 0.007
$ 0.0065
September 30, 2022
$ 0.0057
$ 0.0049
December 31, 2022
$ 0.009
$ 0.0006
Year Ended December 31, 2021
March 31, 2021
$ 0.03
$ 0.03
June 30, 2021
$ 0.0449
$ 0.0375
September 30, 2021
$ 0.029
$ 0.02
December 31, 2021
$ 0.0239
$ 0.021
On March 7, 2023, the closing price of our Common Stock was $0.0006.
Penny Stock
The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a market price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that: (a) contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading; (b) contains a description of the broker’s or dealer’s duties to the customer and of the rights and remedies available to the customer with respect to a violation of such duties or other requirements of the securities laws; (c) contains a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread between the bid and ask price; (d) contains a toll-free telephone number for inquiries on disciplinary actions; (e) defines significant terms in the disclosure document or in the conduct of trading in penny stocks; and (f) contains such other information and is in such form, including language, type size and format, as the SEC shall require by rule or regulation.
The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with (a) bid and offer quotations for the penny stock; (b) the compensation of the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and (d) a monthly account statement showing the market value of each penny stock held in the customer’s account.
In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written acknowledgment of the receipt of a risk disclosure statement, a written agreement as to transactions involving penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements may have the effect of reducing the trading activity for our common stock. Therefore, shareholders may have difficulty selling our securities.
Holders of Our Common Stock
As of March 7, 2023, we had 479,970,663 outstanding shares of common stock and 77 shareholders of record.
Dividends
There are no restrictions in our Articles of Incorporation, as amended, or Bylaws that prevent us from declaring dividends. The payment of dividends on common stock is at the discretion of our Board of Directors. 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 (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.
We currently do not anticipate paying any dividends in the foreseeable future.
Recent Sales of Unregistered Securities
During the fourth quarter of 2022, we issued no unregistered securities that have not been previously reported.
Subsequent to December 31, 2022, we have issued the following unregistered securities that have not been previously reported:
1. (a) Securities Sold. A total of 20,833,333 shares of common stock were issued. (b) Underwriter or Other Purchasers. Such shares of common stock were issued to Boot Capital, LLC. (c) Consideration. Such shares of common stock were issued in payment of debt and were valued at $.0003 per share, or $6,250, in the aggregate. (d) Exemption from Registration Claimed. These securities are exempt from registration under the Securities Act of 1933, as amended, pursuant to the provisions of Section 4(a)(2) thereof.
2. (a) Securities Sold. A total of 106,500,000 shares of common stock were issued. (b) Underwriter or Other Purchasers. Such shares of common stock were issued to Talos Victory Fund, LLC. (c) Consideration. Such shares of common stock were issued in payment of debt and were valued at $.001 per share, or $106,500, in the aggregate. (d) Exemption from Registration Claimed. These securities are exempt from registration under the Securities Act of 1933, as amended, pursuant to the provisions of Section 4(a)(2) thereof.
3. (a) Securities Sold. A $228,200 principal amount promissory note was issued. (b) Underwriter or Other Purchasers. Such promissory note was issued to 1800 Diagonal Lending, LLC. (c) Consideration. Such promissory note was issued in consideration of a loan in the net amount of $125,330.20 in cash. (d) Exemption from Registration Claimed. This security is exempt from registration under the Securities Act of 1933, as amended, pursuant to the provisions of Section 4(a)(2) thereof.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
None.

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ITEM 6. SELECTED FINANCIAL DATA
Item 6. [Reserved]

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Effects of COVID-19
The COVID-19 pandemic had a discernable short-term negative impact on the ability of our company to obtain capital needed to accelerate the development of our business, as well as to obtain needed inventory, due to supply chain delays. While these limitations have eased, we are unable to predict when such limitations will be entirely resolved.
Overall, our company is not of a size that required us to implement “company-wide” policies in response to the COVID-19 pandemic. Further, our product manufacturing operations have experienced no negative consequences attributable to the COVID-19 pandemic, inasmuch as these operations involve a limited number of persons.
For purposes of the discussion below, except where otherwise indicated, the descriptions of our business, our strategies, our risk factors and any other forward-looking statements, including regarding us, our business and the market generally, do not reflect the potential impact of the COVID-19 pandemic or our responses thereto.
Basis of Presentation
This Management’s Discussion and Analysis of Financial Condition and Results of Operations section includes financial results of our company, Black Bird Biotech, Inc., including its subsidiaries, Black Bird Potentials Inc. (BB Potentials), Big Sky American Dist., LLC (Big Sky American) and Black Bird Hemp Manager, LLC, for the years ended December 31, 2022 and 2021.
Cautionary Statement
The following discussion and analysis should be read in conjunction with our financial statements and related notes, beginning on page of this Annual Report.
Our actual results may differ materially from those anticipated in the following discussion, as a result of a variety of risks and uncertainties, including those described herein under “Disclosure Regarding Forward-Looking Statements.” We assume no obligation to update any of the forward-looking statements included herein.
Implications of Being an Emerging Growth Company
We qualify as an “emerging growth company” under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:
·
have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
·
comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);
·
submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency;” and
·
disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation.
In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
We will remain an “emerging growth company” for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1.07 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
Critical Accounting Policies
In General. Our accounting policies are discussed in detail in the footnotes to our financial statements beginning on page. We consider our critical accounting policies related to revenue recognition, inventory and fair value of financial instruments.
Change in Accounting Principle. In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2020-06-Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging- Contracts in Entity's Own Equity (Subtopic 815-40)-Accounting For Convertible Instruments and Contracts in an Entity's Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it. The ASU also simplifies the diluted net income per share calculation in certain areas. The new guidance is effective for annual and interim periods beginning after December 15, 2021, and early adoption is permitted for fiscal years beginning after December 15, 2020. Our company has early-adopted ASU 2020-06 for the year beginning January 1, 2021.
Overview and Outlook
With the acquisition of BB Potentials effective January 1, 2020, BB Potentials’ operations became the operations of our company.
Through BB Potentials, our company is the exclusive worldwide manufacturer and distributor of MiteXstream, an EPA-registered plant-based biopesticide (EPA Reg. No. 95366-1) effective in the eradication of mites and similar pests, including spider mites, a pest that destroys crops, especially cannabis, hops, coffee, and house plants, as well as molds and mildew. Also through BB Potentials, we manufacture and sell CBD products, including CBD Oils, gummies and pet treats, and CBD-infused personal care products, under the Grizzly Creek Naturals brand name. Big Sky American distributes our Grizzly Creek Naturals products, as well as an array of other consumer retail products, in Western Montana. In addition, for 2020 and 2021, BB Potentials was a licensed grower of industrial hemp under the Montana Hemp Pilot Program and, in connection therewith, established “Black Bird American Hemp” as the brand name under which these efforts were to be conducted. For the foreseeable future, we have suspended our hemp-related efforts.
Principal Factors Affecting Our Financial Performance
Following our acquisition of BB Potentials, our future operating results can be expected to be primarily affected by the following factors:
·
our ability to establish and maintain the value proposition of our MiteXstream biopesticide, vis-a-vis other available pest control products;
·
our ability to generate sales channels for MiteXstream; and
·
our ability to contain our operating costs.
Results of Operations
Years Ended December 31, 2022 (“Fiscal 2022”) and 2021 (“Fiscal 2021”). During Fiscal 2022, we established a MiteXstream Store on Amazon.com, which accounted for approximately $3,500 in sales. While these sales demonstrated the economic viability of MiteXstream, such sales were not at a level that provided cash for use in our overall operations. During 2023, we intend to increase our Amazon-specific marketing, in an attempt to garner more sales through our Amazon Store.
Our purchase of certain distribution-related assets in Fiscal 2021 pursuant to the Big Sky APA was made with an expectation that an immediately accessible larger number of retail locations would allow us to increase more quickly sales of our CBD products. Big Sky American, since beginning its consumer product distribution operations in Northwest Montana in April 2021, had a positive impact on our Fiscal 2021 operating results, when compared to our prior operating results. However, the anticipated increase in sales of our CBD products has not occurred. Rather, sales of non-CBD consumer products, in large measure, accounted for the overall increase in our product sales for Fiscal 2021. During Fiscal 2021, sales of MiteXstream were insignificant.
During Fiscal 2022, our business operations generated $82,563 in revenues from sales with a cost of goods sold of $49,551, resulting in a gross profit of $33,012. During Fiscal 2021, our business operations generated $104,458 in revenues with a cost of goods sold of $84,871, resulting in a gross profit of $19,587. While we had a small level of sales of MiteXstream during 2022, the decline in our revenues from the year ended December 31, 2021, is attributable primarily to the significant drop in tourism in Western Montana during the summer of 2022, due to inflationary pressures that resulted an extreme increase in gas prices.
During Fiscal 2022, we incurred operating expenses of $1,321,345, which were comprised of $231,630 in consulting services, $5,337 in website expenses, $43,247 in legal and professional services, $4,800 in rent, $234,519 in advertising and marketing expense and $673,621 in general and administrative expense, resulting in a net operating loss of $1,288,333. In addition, we incurred interest expense of $370,587, resulting in a net loss for Fiscal 2022 of $1,658,766.
During Fiscal 2021, we incurred operating expenses of $1,470,714, which were comprised of $725,240 in consulting services ($573,348 of which was paid by the issuance of common stock), $12,328 in website expenses, $84,457 in legal and professional services, $10,320 in rent, $5,234 in advertising and marketing expense and $523,478 in general and administrative expense, resulting in a net operating loss of $1,451,127. In addition, we incurred interest expense of $285,327, resulting in a net loss for Fiscal 2021 of $1,811,302.
We expect that our revenues will increase from quarter to quarter beginning with the first quarter of 2023, as sales of MiteXstream and Grizzly Creek Naturals products are expected to increase from our continuing marketing efforts. There is no assurance that such will be the case, and we expect to incur operating losses through at least December 31, 2023. Further, because of our relative current lack of capital and the current lack of brand name awareness of MiteXstream, we cannot predict the levels of our future revenues.
Further, because of our relative current lack of capital and the current lack of brand name awareness of MiteXstream and Grizzly Creek Naturals, we cannot predict the levels of our future revenues. However, our management believes that MiteXstream will become the most dynamic, fastest growing part of our business.
Plans for 2023
Substantially all of our available capital, financial and human, will be devoted to increasing sales of MiteXstream. Through our marketing consulting agreement with Spire+, we are implementing a comprehensive go-to-market strategy for MiteXstream, including e-commerce, traditional retail and a category-specific distribution model. In addition, our internal efforts will be focused on developing sales channels outside the scope of the Spire+ efforts. There is no assurance that we will be successful in increasing sales of MiteXstream.
Financial Condition, Liquidity and Capital Resources
December 31, 2022. At December 31, 2022, our company had $44,448 in cash and a working capital deficit of $726,463, compared to $499,766 in cash and working capital of $574,165 at December 31, 2021. The change in our working capital position from December 31, 2021, to December 31, 2022, is attributable primarily to our incurring $1,013,980 in debt and our repayment of $510,560 in debt, the payment of significantly increased marketing expenses and the payment of operating expenses.
Our company’s current cash position of approximately $30,000 is not adequate for our company to maintain its present level of operations through the second quarter of 2023. We must obtain additional capital from third parties to implement our full business plans. There is no assurance that we will be successful in obtaining such additional capital.
Capital Sources. We have derived capital from sales of our common stock and from loans. Our capital sources are described below.
Regulation A Offerings. In May 2020, our company filed an Offering Statement on Form 1-A (File No. 054-11215) (the “Reg A #1”) with the SEC with respect to 70,000,000 shares of common stock, as amended, which was qualified by the SEC on August 4, 2020. During the year ended December 31, 2021, we sold a total of 4,875,000 shares of common stock for a total of $195,000 in cash, under the Reg A #1, which expired by its terms on August 4, 2021. At the end of August 2021, our company filed a second Offering Statement on Form 1-A (File No. 024-11621) (the “Reg A #2”) with the SEC with respect to 100,000,000 shares of common stock, as amended, which was qualified by the SEC on September 9, 2021. During the year ended December 31, 2021, we sold a total of 93,033,333 shares of common stock for a total of $1,395,500 in cash, under the Reg A #2.
Third-Party Loans.
Tri-Bridge Ventures LLC. In April 2020, the Company obtained a loan in the amount of $25,000 from Tri-Bridge Ventures LLC. In consideration of such loan, the Company issued a $25,000 face amount convertible promissory note (the “Tri-Bridge Note”) bearing interest at 10% per annum, with principal and interest due in January 2021. Tri-Bridge Note is convertible into shares of the Company’s common stock at the rate of one share for each $.001 of debt converted anytime after August 30, 2020.
During the year ended December 31, 2022, the Tri-Bridge Note #1 was repaid in full through conversion into shares of the Company’s common stock, as follows:
Amount Converted
Conversion Price Per Share
Number Shares
$ 25,000
$ 0.001
24,999,998
Total Converted: $25,000
Total Shares: 24,999,988
At December 31, 2022 and 2021, accrued interest on the Tri-Bridge Note was $-0- and $4,178, respectively. The $4,178 in accrued interest was forgiven by Tri-Bridge.
EMA Financial, LLC. In December 2020, the Company obtained a loan from EMA Financial, LLC which netted us $50,000 in proceeds. In consideration of such loan, the Company issued a $58,600 face amount convertible promissory note (the “EMA Note”), with OID of $4,100, bearing interest at 10% per annum, with principal and interest due in September 2021. The Company had the right to repay the EMA Note at a premium ranging from 120% to 145% of the face amount. The EMA Note was convertible into shares of the Company’s common stock at a conversion price equal to the lower of 60% of the market price of the Company’s common stock on the date of issuance of the EMA Note and the date of conversion, any time after June 15, 2021.
In June 2021, the EMA Note was repaid in full in the amount of $93,697.70, as follows: $58,600 in principal; $3,499.30 in interest; and $31,598.40 as a prepayment premium.
Power Up Lending Group Ltd. In January 2021, the Company obtained a loan from Power Up Lending Group Ltd. which netted the Company $52,000 in proceeds. In consideration of such loan, the Company issued a $55,500 face amount convertible promissory note (“Power Up Note #1”) bearing interest at 12% per annum, with principal and interest due in January 2022. The Company had the right to repay the Power Up Note #1 at a premium ranging from 125% to 145% of the face amount. The Power Up Note #1 was convertible into shares of the Company’s common stock at a conversion price equal to the lower of 61% of the market price of the Company’s common stock on the date of issuance of the Power Up Note #1 and the date of conversion, any time after July 14, 2021.
During the year ended December 31, 2021, the Power Up Note #1 was repaid in full through conversion into shares of the Company’s common stock, as follows:
Amount Converted
Conversion Price Per Share
Number Shares
$ 15,000
$ 0.0162
925,926
$ 20,000
$ 0.0143
1,398,601
$ 20,500
$ 0.0143
1,666,434
Total Converted: $55,500
Total Shares: 3,990,961
SE Holdings, LLC. In February 2021, the Company obtained a loan from SE Holdings LLC which netted the Company $106,000 in proceeds. In consideration of such loan, the Company issued a $121,000 face amount promissory note (the “SE Holdings Note”), with OID of $15,000, bearing interest at 9% per annum, with principal and interest payable in eight equal monthly payments of $15,125 beginning in July 2021. The Company had the right to repay the SE Holdings Note at any time. Should the Company have been in default on SE Holdings Note, the SE Holdings Note would have become convertible into shares of the Company’s common stock at a conversion price equal to the lesser of the lowest closing bid price of the Company’s commons stock for the trading day immediately preceding either (a) the delivery of a notice of default, (b) the delivery of a notice of conversion resulting from such default or (c) the issue date of the SE Holdings Note. In addition, the Company issued 2,000,000 shares of its common stock to SE Holdings as a commitment fee, which shares were valued at $0.065 with a 50% discount per share, or $65,000, in the aggregate.
Through September 2021, the Company had repaid $45,375 of the SE Holdings Note, in accordance with the terms of the SE Holdings Note. In October 2021, the remaining balance of the SE Holdings Note, $75,625, was repaid by the Company.
Power Up Lending Group Ltd. In February 2021, the Company obtained a loan from Power Up Lending Group Ltd. which netted the Company $43,500 in proceeds. In consideration of such loan, the Company issued a $43,500 face amount convertible promissory note (“Power Up Note #2”) bearing interest at 12% per annum, with principal and interest due in January 2022. The Company had the right to repay the Power Up Note #2 at a premium ranging from 125% to 145% of the face amount. The Power Up Note #2 was convertible into shares of the Company’s common stock at a conversion price equal to the lower of 61% of the market price of the Company’s common stock on the date of issuance of the Power Up Note #2 and the date of conversion, any time after August 17, 2021.
During the year ended December 31, 2021, the Power Up Note #2 was repaid in full through conversion into shares of the Company’s common stock, as follows:
Amount Converted
Conversion Price Per Share
Number Shares
$ 15,000
$ 0.0137
1,094,891
$ 20,000
$ 0.0093
2,150,538
$ 11,110
*
$ 0.0081
1,371,605
Total Converted:
46,110
Total Shares:
4,617,034
* This amount includes $2,610 of interest.
Power Up Lending Group Ltd. In April 2021, the Company obtained a loan from Power Up Lending Group Ltd. which netted the Company $68,750 in proceeds. In consideration of such loan, the Company issued a $68,750 face amount convertible promissory note (“Power Up Note #3”) bearing interest at 12% per annum, with principal and interest due in April 2022. The Company had the right to repay the Power Up Note #3 at a premium ranging from 125% to 145% of the face amount. The Power Up Note #3 was convertible into shares of the Company’s common stock at a conversion price equal to the lower of 61% of the market price of the Company’s common stock on the date of issuance of the Power Up Note #3 and the date of conversion, any time after October 22, 2021.
In September 2021, the Power Up Note #3 was repaid in full by the Company, as follows: $68,750.00 in principal, $27,500.00 in additional principal as a prepayment premium and $5,063.01 in interest, a total repayment amount of $101,313.01.
Power Up Lending Group Ltd. In August 2021, the Company obtained a loan from Power Up Lending Group Ltd. which netted the Company $78,750 in proceeds. In consideration of such loan, the Company issued a $78,750 face amount convertible promissory note (“Power Up Note #4”) bearing interest at 12% per annum, with principal and interest due in August 2022. The Company had the right to repay the Power Up Note #4 at a premium ranging from 125% to 145% of the face amount. The Power Up Note #4 was convertible into shares of the Company’s common stock at a conversion price equal to the lower of 61% of the market price of the Company’s common stock on the date of issuance of the Power Up Note #4 and the date of conversion, any time after October 22, 2021.
In September 2021, the Power Up Note #4 was repaid in full by the Company, as follows: $78,750.00 in principal, $15,750.00 in additional principal as a prepayment premium and $5,393.84 in interest, a total repayment amount of $99,893.84.
FirstFire Global Opportunities Fund LLC. In September 2021, the Company obtained a loan from FirstFire Global Opportunities Fund LLC which netted the Company $125,000 in proceeds. In consideration of such loan, the Company issued a $250,000 face amount convertible promissory note (“FirstFire Note”), with OID of $125,000, due in September 2022. The Company had the right to repay the FirstFire Note at anytime, with a 20%, or $50,000, reduction in principal owed if repaid in full on or before November 30, 2021. The FirstFire Note was convertible into shares of the Company’s common stock at a conversion price equal to $.015 per share, any time after December 1, 2021.
Prior to November 30, 2021, the FirstFire Note was repaid in full by the Company, in the amount of $200,000 (which included a $50,000 reduction in principal owed, due to the FirstFire Note’s being repaid in full on or before November 30, 2021).
Tiger Trout Capital Puerto Rico, LLC. In September 2021, the Company obtained a loan from Tiger Trout Capital Puerto Rico, LLC which netted the Company $250,000 in proceeds. In consideration of such loan, the Company issued a $500,000 face amount convertible promissory note (“Tiger Trout Note”), with OID of $250,000, with principal due in September 2022. The Company has the right to repay the Tiger Trout Note at anytime, with a 10%, or $50,000, reduction in principal owed if repaid in full on or before November 30, 2021. The Tiger Trout Note is convertible into shares of the Company’s common stock at a conversion price equal to $.015 per share, any time after December 1, 2021.
During the year ended December 31, 2022, the Company repaid in full the remaining $200,000 balance of the Tiger Trout Note.
1800 Diagonal Lending LLC. In March 2022, the Company obtained a loan from Sixth Street Lending LLC, who later assigned the loan to an affiliated company, 1800 Diagonal Lending LLC, which netted the Company $200,000 in proceeds. In consideration of such loan, the Company issued a $228,200 face amount promissory note (the “1800 Diagonal Note #1”), with OID of $24,450 and a one-time interest charge of $25,102, with principal and interest payable in 10 equal monthly payments of $25,330.20 beginning in May 2022. The Company has the right to repay the 1800 Diagonal Note #1 at any time, without penalty. Should the Company become in default on the 1800 Diagonal Note #1, the 1800 Diagonal Note #1 becomes convertible into shares of the Company’s common stock at a conversion price equal to 75% multiplied by the lowest trading price of the Company’s common stock during the 10 trading days prior to the applicable conversion date.
As of December 31, 2022, the Company was current in its repayment obligations under the 1800 Diagonal Note #1 and the 1800 Diagonal Note #1 had a remaining balance of $50,660 at December 31, 2022.
Talos Victory Fund, LLC. In May 2002, the Company obtained a loan from Talos Victory Fund, LLC which netted the Company $107,780 in proceeds. In consideration of such loan, the Company issued a $135,000 face amount promissory note (the “Talos Note #1”), with OID of $13,500, commissions of $9,720 and legal fees of $4,000. The Talos Note #1 is due in May 2023 and is convertible into shares of the Company’s common stock at any time at a conversion price of $.005 per share, subject to a 4.99% equity blocker.
During the year ended December 31, 2022, $16,200 in accrued interest on the Talos Note #1 was repaid through conversion into shares of the Company’s common stock, as follows:
Amount Converted
Conversion Price Per Share
Number Shares
$ 16,200
$ 0.001
16,200,000
Total Converted: $16,200
Total Shares: 16,200,000
During the year ended December 31, 2022, $28,500 in principal on the Talos Note #1 was repaid through conversion into shares of the Company’s common stock, as follows:
Amount Converted
Conversion Price Per Share
Number Shares
$ 28,500
$ 0.001
28,500,000
Total Converted: $28,500
Total Shares: 28,500,000
At December 31, 2022, the Talos Note #1 had a remaining balance of $106,500.
Subsequent to December 31, 2022, the Talos Note #1 was repaid in full through conversion into shares of the Company’s common stock, as follows:
Amount Converted
Conversion Price Per Share
Number Shares
$ 106,500
$ 0.001
106,500,000
Total Converted: $106,500
Total Shares: 106,500,000
Mast Hill Fund, L.P. In May 2002, the Company obtained a loan from Mast Hill Fund, L.P. which netted the Company $200,000 in proceeds. In consideration of such loan, the Company issued a $250,000 face amount promissory note (the “Mast Hill Note #1”), with OID of $25,000, commissions of $18,000 and legal fees of $7,000. The Mast Hill Note #1 is due in May 2023 and is convertible into shares of the Company’s common stock at any time at a conversion price of $.005 per share, subject to a 4.99% equity blocker.
In December 2022, the Mast Hill Note #1 was amended to increase the principal by $100,000, which amount represents financing fees. Also in December 31, 2022, the Company repaid $100,000 in principal of the Mast Hill Note #1.
During the year ended December 31, 2022, $9,500 in principal, $30,000 in interest and $7,000 in fees with respect to the Mast Hill Note #1 was repaid through conversion into shares of the Company’s common stock, as follows:
Amount Converted
Conversion Price Per Share
Number Shares
$ 46,500
$ 0.001
46,500,000
Total Converted: $46,500
Total Shares: 46,500,000
At December 31, 2022, the Mast Hill Note #1 had a remaining balance of $240,500.
GS Capital Partners, LLC. In June 2022, we obtained a loan from GS Capital Partners, LLC which netted our company $63,650 in proceeds. In consideration of such loan, we issued a $70,000 face amount promissory note (the “GS Capital Note #1”), with OID of $6,500, a finder’s fee of $4,900 and legal fees of $3,000, with principal and interest payable in 10 equal monthly payments of $7,840 beginning in September 2022. The Company has the right to repay the GS Capital Note #1 at any time, without penalty. Should the Company become in default on the GS Capital Note #1, the GS Capital Note #1 becomes convertible into shares of the Company’s common stock at a conversion price equal to 70% multiplied by the lowest trading price of the Company’s common stock during the 10 trading days prior to the applicable conversion date.
As of December 31, 2022, the Company was current in its repayment obligations under the GS Capital Note #1 and the GS Capital Note #1 had a remaining balance of $42,000 at September 30, 2022.
Boot Capital, LLC. In August 2022, the Company obtained a loan from Boot Capital, LLC which netted the Company $56,000 in proceeds. In consideration of such loan, the Company issued a $61,600 face amount promissory note (the “Boot Capital Note #1”), with OID of $5,600, commissions of $3,360 and legal fees of $2,500. The Boot Capital Note #1 is due in August 2023 and is convertible into shares of the Company’s common stock at any time after 180 days of issuance at a conversion price at a 40% discount to the then-market price of the Company’s common stock, subject to a 4.99% equity blocker.
At December 31, 2022, the Boot Capital Note #1 had a remaining balance of $61,600.
Mast Hill Fund, L.P. In September 2022, the Company obtained a loan from Mast Hill Fund, L.P. which netted the Company $130,500 in proceeds. In consideration of such loan, the Company issued a $145,000 face amount promissory note (the “Mast Hill Note #2”), with OID of $14,500, commissions of $10,440 and legal fees of $3,000. The Mast Hill Note #2 is due in September 2023 and is convertible into shares of the Company’s common stock at any time at a conversion price of $.0025 per share, subject to a 4.99% equity blocker.
At December 31, 2022, the Mast Hill Note #2 had a remaining balance of $145,000.
Subsequent to December 31, 2022, $6,250 in principal of the Boot Capital Note #1 has been repaid through conversion into shares of the Company’s common stock, as follows:
Amount Converted
Conversion Price Per Share
Number Shares
$ 6,250
$ 0.001
20,833,333
Total Converted: $6,250
Total Shares: 20,8333,333
1800 Diagonal Lending LLC. In November 2022, the Company obtained a loan from 1800 Diagonal Lending LLC which netted the Company $100,000 in proceeds. In consideration of such loan, the Company issued a $103,750 face amount convertible promissory note (“1800 Diagonal Note #2”) bearing interest at 10% per annum, with principal and interest due in November 2023. The Company has the right to repay the 1800 Diagonal Note #2 at a premium ranging from 120% to 125% of the face amount. The 1800 Diagonal Note #2 is convertible into shares of the Company’s common stock at a conversion price equal to 65% multiplied by the average of the two lowest trading prices of the Company’s common stock during the 15 trading days prior to the applicable conversion date, any time after May 7, 2023.
At December 31, 2022, the 1800 Diagonal Note #2 had a remaining balance of $103,750.
Mast Hill Fund, L.P. In December 2022, the Company obtained a loan from Mast Hill Fund, L.P. which netted the Company $179,650 in proceeds. In consideration of such loan, the Company issued a $223,000 face amount senior secured promissory note (the “Mast Hill Note #3”), with OID of $22,300, commissions of $16,050 and legal fees of $5,000. The Mast Hill Note #3 is due in December 2023 and is convertible into shares of our common stock at any time at a conversion price of $.001 per share, subject to a 4.99% equity blocker. In connection with the Mast Hill Note #3, we issued to Mast Hill 223,000,000 cashless warrants with an exercise price of $.001 per share. Additionally, we issued 11,468,572 cashless warrants with an exercise price of $0.0014 per share to Darbie, as a placement agent fee, in connection with the Mast Hill Note #3.
At December 31, 2022, the Mast Hill Note #3 had a remaining balance of $223,000.
1800 Diagonal Lending LLC. In January 2023, we obtained a loan from 1800 Diagonal Lending LLC, which netted the Company $125,330.20 in proceeds. In consideration of such loan, the Company issued a $144,569.20 face amount promissory note (the “1800 Diagonal Note #3”), with OID of $15,489, a one-time interest charge of $17,348.30, legal fees of $3,000 and $750 in due diligence fees, with principal and interest payable in 10 equal monthly payments of $16,191.75 beginning in February 2023. The Company has the right to repay the 1800 Diagonal Note #3 at any time, without penalty. Should the Company become in default on the 1800 Diagonal Note #3, the 1800 Diagonal Note #3 becomes convertible into shares of the Company’s common stock at a conversion price equal to 75% multiplied by the lowest trading price of the Company’s common stock during the 10 trading days prior to the applicable conversion date.
Related Party Loans. During the year ended December 31, 2021, we obtained an advance from one of our officers and directors, Eric Newlan, as follows:
In June 2021, Mr. Newlan advanced the sum of $93,732.70 to the Company. The funds were used to repay the EMA Financial Note (the total repayment amount was $93,697.70: $58,600 in principal; $3,499.30 in interest; and $31,598.40 as a prepayment premium). Such funds were obtained as a loan on open account, accrue no interest and are due on demand. At December 31, 2021, such loan had been repaid in full, in the amount of $93,697.70.
During the years ended December 31, 2021 and 2020, advances of $772 and $6,670 were received from Astonia LLC. The amounts due Astonia LLC bear interest at 5% per year and have a maturity of one year. As of December 31, 2022 and 2021, the Company owed Astonia LLC $5,242 and $5,242 in principal, respectively, and $491 and $268 in accrued and unpaid interest, respectively.
Inflation
Our management believes economic conditions point toward continuing significant inflationary pressures for the foreseeable future. However, no prediction can be made in this regard and, further, no prediction can be made with respect to how the potential impact any inflation would affect our future results of operations. However, during the summer of 2022, the sales of our Big Sky American subsidiary were impacted negatively by inflationary pressures that caused a significant reduction in tourism in Western Montana primarily attributable to a sharp increase in gas prices.
Seasonality
For the foreseeable future, we expect that our operating results with respect to MiteXstream will be impacted, in an indeterminate measure, by the seasonality of farming operations, including cannabis grow operations. However, we are currently unable to predict the level to which such seasonality will impact our MiteXstream business.
Off Balance Sheet Arrangements
As of December 31, 2022, there were no off-balance sheet arrangements.
Contractual Obligations
In May 2020, BB Potentials entered into a facility lease with Grizzly Creek Farms, LLC, an entity owned by one our Directors, Fabian G. Deneault, with respect to approximately 2,000 square feet of manufacturing space located in Ronan, Montana. Monthly rent under such lease was $1,500 and the initial term of such lease expired in December 2025. This lease was terminated effective April 1, 2021. Since such date, Mr. Deneault permits BB Potentials to utilize the previously-leased facility for storage, at no charge.
The following sets forth information concerning the sole operating lease for the facility maintained by us as of the date of this Annual Report.
Address
Description
Use
Yearly Rent
Expiration Date
11961 Hilltop Road
Building 7 - Suite 22
Argyle, Texas 76226
Office/Warehouse
(1,500 sq. ft.)
Administrative/ Warehousing
$8,700 *
January 31, 2025
*
We are co-lessees under the lease agreement by which we rent this facility. Our co-lessee is Petro X Solutions, Inc., a wholly-owned subsidiary of Accredited Solutions, Inc., a publicly-traded company (symbol: GHMP), an affiliate our company. By agreement with Petro X Solutions, we are each responsible for 50% of the rent and all tenancy-related expenses. However, should Petro X Solutions default in its rent obligations, our company would be responsible for paying the entire monthly rental amount of $1,450.
Capital Expenditures
We made no capital expenditures during the years ended December 31, 2022. We made capital expenditures of $185,702 during the year ended December 31, 2021, which included the purchase of distribution assets used by Big Sky American and the purchase of other distribution-related assets. Without obtaining additional capital, we will not be able to make any capital expenditures.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Not applicable to a smaller reporting company.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Item 8. Financial Statements and Supplementary Data
Please see our Financial Statements beginning on page of this Annual Report.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
During the years ended December 31, 2022 and 2021, there were no changes, in or disagreements with, our independent auditor.

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ITEM 9A. CONTROLS AND PROCEDURES
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed pursuant to the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms and that such information is accumulated and communicated to our management, including our President and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
As required by Exchange Act Rule 13a-15(e), we carried out an evaluation, under the supervision and with the participation of our management, including our President and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, our President and our Chief Financial Officer concluded that our disclosure controls were not effective at December 31, 2022.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:
·
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
·
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and
·
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.
As an emerging growth company experiencing rapid growth, we have worked diligently to improve processes within our company, specifically including within our manufacturing environment, that increase risk related to transaction processing which can impact our financial reporting. We intend to implement a significant number of manual compensating controls to address this risk.
Because of the inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.
Our management, including our President and our Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2022. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the 2013 Treadway Commission (“COSO”) in Internal Control-Integrated Framework. Based on that evaluation, they concluded that, during the period covered by this Annual Report, such internal controls and procedures were not effective.
This Annual Report on Form 10-K does not include an attestation report by our company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our company’s registered public accounting firm pursuant to the rules of the SEC that require our company to provide only our company’s management’s report in this Annual Report on Form 10-K.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting during our last fiscal year that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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ITEM 9B. OTHER INFORMATION
Item 9B. Other Information
None.

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Item 10. Directors, Executive Officers and Corporate Governance
Directors and Executive Officers
The following table sets forth the names and ages of our company’s current directors and executive officers.
Name
Age
Position(s)
Fabian G. Deneault
Director, Chairman of the Board, President
Eric Newlan
Director, Vice President, Secretary
William E. Sluss
Director, Vice President-Finance, Chief Financial Officer
William J. LoBell
Executive Vice President of Sales and Development
Jack Jie Qin
Director
L. A. Newlan, Jr.
Director
Our Directors serve until the earlier occurrence of the election of his successor at the next meeting of shareholders, death, resignation or removal by the Board of Directors. Officers serve at the discretion of our Board of Directors. Eric Newlan is the son of L. A. Newlan, Jr. There exist no other family relationships among our officers and directors.
Certain information regarding the backgrounds of each of our officers and directors is set forth below.
Fabian G. Deneault became our company’s President and a Director upon our acquisition of Black Bird, January 2020. Mr. Deneault is a founder of Black Bird and has served as President and as a Director since its inception in October 2018. Since May 2022, Mr. Deneault has served as Executive Vice President and a Director of Accredited Solutions, Inc., a publicly-traded company (symbol: ASII) engaged in the distribution of environmentally sensitive cleaning products and Diamond Creek high alkaline water. Since 2017, Mr. Deneault has been an insurance representative for Montana Unified School Trust. From January 2017 through December 2019, Mr. Deneault owned and operated Grizzly Creek Medical Cannabis, a proprietorship licensed as a medical marijuana dispensary in the State of Montana. Since June 2016, Mr. Deneault has been President of Touchstone Enviro Solutions, Inc., a purveyor of environmentally-friendly products and an affiliate of our company. From 2014 through April 2016, Mr. Deneault owned and operated PetroXg3 LLC, a purveyor of environmentally-friendly products. For more than 10 years prior to that, Mr. Deneault was engaged in petrochemical sales.
Eric Newlan became our company’s Vice President and a Director upon our acquisition of Black Bird, January 2020. Mr. Newlan is a founder of Black Bird and has served as Vice President, Secretary and as a Director since its inception in October 2018. Since May 2022, Mr. Newlan has served as Vice President, Secretary and a Director of Accredited Solutions, Inc., a publicly-traded company (symbol: ASII) engaged in the distribution of environmentally sensitive cleaning products and Diamond Creek high alkaline water. Since 1987, Mr. Newlan has practiced law in the North Texas area and is currently managing member of Newlan Law Firm, PLLC, Flower Mound, Texas, a firm engaged principally in the area of securities regulation. Since June 2016, Mr. Newlan has been Vice President of Touchstone Enviro Solutions, Inc., a purveyor of environmentally-friendly products and an affiliate of our company. From October 2012 to October 2015, Mr. Newlan served as a director, and from April to October 2015, Mr. Newlan served as CEO, of Green Life Development, Inc., a Las Vegas, Nevada-based a purveyor of environmentally-friendly products. Mr. Newlan earned a B.A. degree in Business from Baylor University, Waco, Texas, and a J.D. degree from the Washburn University School of Law, Topeka, Kansas. Mr. Newlan is a member of the Texas Bar.
William E. Sluss has been our Principal Financial and Accounting Officer since January 2011. In January 2020, Mr. Sluss became a Director, Vice President-Finance and Chief Financial Officer of our company. Since May 2022, Mr. Sluss has served as a Director of Accredited Solutions, Inc., a publicly-traded company (symbol: GHMP) engaged in the distribution of environmentally sensitive cleaning products and Diamond Creek high alkaline water. Between August 2010 and January 2011, Mr. Sluss coordinated our accounting and financial reporting. Between 2008 and 2010, Mr. Sluss was the Chief Financial Officer for AcccuForce Staffing Services in Kingsport, Tennessee. Between 2002 and 2008 Mr. Sluss was the Chief Financial Officer and Treasurer for Studsvik, Inc., a nuclear services company based in Erwin, Tennessee. Mr. Sluss is a Certified Public Accountant in the State of Virginia and received his Bachelor of Science degree in accounting from the University of Virginia’s College at Wise, Wise, Virginia.
William J. LoBell has been our Executive Vice President of Sales and Development since April 2022. From December 2021 until April 2022, Mr. LoBell served as a consultant to Barry’s Restore It All Products, a Carlsbad, California-based developer of restoration products. From June 2016 to December 2021, he served as Chief Operating Officer of MSMART, a developer and purveyor of nano-technologies. From April 2011 to August 2017, Mr. LoBell was a Founder and Chief Executive Officer of Luminec Animal Sciences Corporation, where he both developed and directed the distribution of animal health products. From 2008 to July 2017, Mr. LoBell provided retail management consulting services to numerous national pet industry retailers in his position at Gerson Lehrman Group. Mr. LoBell’s experience prior to 2008 included Director of E-Commerce for Petsense Inc., Retail Management Consultant to 99 Cents Only Stores, West Coast Director of Operations and Director of Sales Programs for Petco Animal Supply Company, West Coast Regional Operating Vice President for PETSMART, INC. and Western Region District Manager for American Stores (Jewel Supermarket, Osco Drug Stores and Sav-On Drugs Inc.).
L. A. Newlan, Jr. became a Director of our company upon our acquisition of Black Bird, January 2020 and is a founder of Black Bird. Mr. Newlan was born in Morristown, New Jersey. After a public school education in Daytona Beach, Florida, he served a three-year tour of duty in the United States Marine Corps, from 1953-1956. Mr. Newlan earned a B.A. in Political Science from the University of California at Los Angeles, in 1961, and a J.D. degree from Loyola University of Los Angeles School of Law, Los Angeles, California, in 1964. He has engaged in the private practice of law in California (1965-1977), Kansas (1977-1984) and Texas (1984-Present). Since 1987, Mr. Newlan has been a shareholder in the Flower Mound, Texas, law firm of Newlan & Newlan, Ltd., a firm engaged principally in the area of securities regulation, and is currently Of Counsel to Newlan Law Firm, PLLC, Flower Mound, Texas. In addition to the practice of law during his career, Mr. Newlan has engaged in business in the oil and gas industry, international construction and engineering and alcoholic beverage distribution. Mr. Newlan is a member of the Texas Bar.
Jack Jie Qin has been a Director of our company since February 2010. From February 2010 until our acquisition of Black Bird in January 2020, Mr. Qin served as our President, Chief Executive Officer and Secretary. Mr. Qin has been President, Chief Executive Officer and Chairman of the Board of EFT Holdings, Inc., a Los Angeles, California-based product sales company, since November 2007. Since July 2016, Mr. Qin has served as a Director and President/CEO of HeavenStone Corp., a Temecula, California-based real estate development company. Since 2002, Mr. Qin has been the President of EFT Inc., the predecessor of EFT Holdings, Inc. From July 1998 to December 2002, Mr. Qin was the President of eFastTeam International, Inc. located in Los Angeles, California. Between June 1992 and December 1997 Mr. Qin was the President of LA Import & Export Company, also located in Los Angeles, California. In May 1991, Mr. Qin earned an MBA degree from Emporia State University, Emporia, Kansas. In May 1982, Mr. Qin graduated from Jiangxi Engineering Institute in Nanchang, China, with a major in Mechanical Engineering.
Conflicts of Interest
Our company has obtained an exclusive worldwide license with respect to MiteXstream from Touchstone Enviro Solutions, Inc. (Touchstone), a company controlled by three of our directors, Fabian G. Deneault, Eric Newlan and L. A. Newlan, Jr. Due to this circumstance, it is possible that these persons could be in a conflict of interest position at a time in the future. Should any such conflict of interest arise, Messrs. Deneault, Newlan and Newlan will, in accordance with the fiduciary duty to our company and our shareholders, resolve any such conflict of interest by exercising utmost good faith and fair dealing.
Corporate Governance
In General. We do not have a separate Compensation Committee, Audit Committee or Nominating Committee. These functions are conducted by our Board of Directors acting as a whole. During 2021, our Board of Directors held one meeting, and took action by written consent in lieu of a meeting on two occasions.
Executive Committee. Our Board of Directors created an Executive Committee to facilitate management between meetings of the full Board of Directors. The Executive Committee is composed of Fabian G. Deneault (chairman), William E. Sluss and Eric Newlan. During 2021, the Executive Committee did not hold a meeting, but took action by written consent in lieu of a meeting on 16 occasions. Pursuant to our Bylaws and the charter of the Executive Committee, between meetings of the full Board of Directors, the Executive Committee has the full power and authority of the Board of Directors in the manageent of our business and affairs, except to the extent limited by Nevada law.
Independence of Board of Directors
None of our directors is independent, within the meaning of definitions established by the SEC or any self-regulatory organization. We are not currently subject to any law, rule or regulation requiring that all or any portion of our Board of Directors include independent directors.
Shareholder Communications with Our Board of Directors
Our company welcomes comments and questions from our shareholders. Shareholders should direct all communications to our Vice President and Secretary, Eric Newlan, at our executive offices. However, while we appreciate all comments from shareholders, we may not be able to respond individually to all communications. We will attempt to address shareholder questions and concerns in our press releases and documents filed with the SEC, so that all shareholders have access to information about us at the same time. Mr. Newlan collects and evaluates all shareholder communications. All communications addressed to our directors and executive officers will be reviewed by those parties, unless the communication is clearly frivolous.
Code of Ethics
As of the date of this Annual Report, our Board of Directors has not adopted a code of ethics with respect to our directors, officers and employees.

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ITEM 11. EXECUTIVE COMPENSATION
Item 11. Executive Compensation
In General
Currently, our management is unable to estimate accurately when, if ever, our company will possess sufficient capital, whether derived from sales revenues, this offering or otherwise, for the payment of salaries to our management.
As of the date of this Annual Report, there are no annuity, pension or retirement benefits proposed to be paid to officers, directors or employees of our company, pursuant to any presently existing plan provided by, or contributed to, our company.
Compensation Summary
The following table summarizes information concerning the compensation awarded, paid to or earned by, our executive officers.
Name and Principal Position
Year
Salary
($)
Bonus
($)
Stock
Awards
($)
Option
Awards
($)
Non-Equity Incentive Plan Com-
pensation
($)
Non-qualified
Deferred
Compen-sation
Earnings
($)
All Other Compen-
sation
($)
Total
($)
Fabian G. Deneault
President
80,000
60,000
---
---
---
---
---
---
---
---
---
---
10,000
30,000
90,000
90,000
William E. Sluss
Vice President-Finance and
Chief Financial Officer
60,000
20,000
---
---
---
---
---
---
---
---
---
---
---
25,000
60,000
45,000
Eric Newlan
Vice President
80,000
60,000
---
---
---
---
---
---
---
---
---
---
---
24,000
80,000
84,000
Outstanding Option Awards
The following table provides certain information regarding unexercised options to purchase common stock, stock options that have not vested and equity-incentive plan awards outstanding as of the date of this Annual Report, for each named executive officer.
Option Awards
Stock Awards
Name
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
Number of
Securities
Underlying
Unexercised
Options (#)
Unex-ercisable
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
Option
Exercise
Price ($)
Option
Expiration
Date
Number of
Shares or
Units of
Stock That
Have Not
Vested (#)
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested ($)
Equity
Incentive
Plan Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested (#)
Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested ($)
William E. Sluss
--- --- --- --- n/a --- n/a --- ---
Fabian G. Deneault
--- --- --- --- n/a --- n/a --- ---
Eric Newlan
--- --- --- --- n/a --- n/a --- ---
Employment Agreements
We have entered into an employment agreement with one of our executive officers, William J. LoBell. Our agreement with Mr. LoBell is for a two-year term, beginning in April 2022. Under the agreement, Mr. LoBell was issued 1,000,000 shares of our common stock as a signing bonus and he is to be issued 500,000 shares of our common stock on the first day of July 2022, October 2022, January 2023 and April 2023. By the terms of the agreement, all shares of common stock issued to Mr. LoBell are valued at $0.01 per share. Additionally, Mr. LoBell is to be paid a monthly salary of $5,000.
It is our intention to enter into employment agreements with our other executive officers in the future. None of the terms of such employment agreements has been determined.
Outstanding Equity Awards
Our Board of Directors has made no equity awards and no such award is pending.
Long-Term Incentive Plans
We currently have no employee incentive plans.
Director Compensation
Our directors receive no compensation for their serving as directors.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The following table sets forth information about the beneficial ownership of our capital stock at March 7, 2023, for:
·
each person known to us to be the beneficial owner of more than 5% of our common stock;
·
each named executive officer;
·
each of our directors; and
·
all of our named executive officers and directors as a group.
Unless otherwise indicated, the business address of each person listed is in care of Black Bird Biotech, Inc., 11961 Hilltop Road, Suite 22, Argyle, Texas 76226. The percentages in the table have been calculated on the basis of treating as outstanding for a particular person, all shares of our common stock outstanding on that date and all shares of our common stock issuable to that holder in the event of exercise of outstanding options, warrants, rights or conversion privileges owned by that person at that date which are exercisable within 60 days of that date. Except as otherwise indicated, the persons listed below have sole voting and investment power with respect to all shares of our common stock owned by them, except to the extent that power may be shared with a spouse.
In computing the number of shares of our common stock beneficially owned by a person and the percentage ownership of that person, we deemed outstanding shares of our common stock subject to options, warrants, preferred stock or restricted stock units held by that person that are currently exercisable or convertible or exercisable or convertible within 60 days of March 7, 2023. We did not deem these shares outstanding, however, for the purpose of computing the percentage ownership of any other person.
Name of Shareholder
Number of Shares
Beneficially
Owned
%
Beneficially
Owned(1)
Effective Voting Power
Common Stock
Executive Officers and Directors
Fabian G. Deneault
0 %
See Note 2
William E. Sluss
500,000
*
and Note 4
William J. LoBell
1,500,000
*
Eric Newlan
0 %
L. A. Newlan, Jr.
0 %
Jack Jie Qin
0 %
Officers and directors, as a group (6 persons)
2,000,000
*
Class A Preferred Stock(2)(3)
Fabian G. Deneault
14,250
33.93 %
William E. Sluss
1,000
2.38 %
Newlan & Newlan, Ltd.(5)
14,250
33.93 %
EFT Holdings, Inc.(6)
9,778
23.28 %
EF2T, Inc.(7)
1,202
2.86 %
Astonia LLC(8)
1,520
3.62 %
*
Less than 1%.
(1)
Based on 479,970,663 shares outstanding.
(2)
The shares of Series A Preferred Stock have the following voting rights: the holders of the Series A Preferred Stock shall, as a class, have rights in all matters requiring shareholder approval to a number of votes equal to two (2) times the sum of: (a) the total number of shares of common stock which are issued and outstanding at the time of any election or vote by the shareholders; plus (b) the number of votes allocated to shares of Preferred Stock issued and outstanding of any other class that shall have voting rights. (See Note 3).
(3)
The shares of Series A Preferred Stock have the following rights of conversion: each 1,000 shares of Series A Preferred Stock shall be convertible at any time into a number of shares of our common stock that equals one percent (1.00%) of the number of issued and outstanding shares of our common stock outstanding on the date of conversion.
(4)
Due to the superior voting rights of the Series A Preferred Stock, our current directors, Fabian G. Deneault, William E. Sluss, Eric Newlan, L. A. Newlan, Jr. and Jack Jie Qin, will be able to control the management and affairs of our company, as well as matters requiring the approval by our shareholders, including the election of directors, any merger, consolidation or sale of all or substantially all of our assets, and any other significant corporate transaction.
(5)
Newlan & Newlan, Ltd. is a law firm owned by Eric Newlan and L. A. Newlan, Jr. 7,250 of the shares owned of record by Newlan and Newlan, Ltd. are beneficially owned by Cruciate Irrevocable Trust, of which trust L. A. Newlan, Jr. is a trustee.
(6)
Our director, Jack Jie Qin, is President of this entity.
(7)
Our director, Jack Jie Qin, is the owner of this entity.
(8)
Our director, Jack Jie Qin, is the manager of this entity.

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Item 13. Certain Relationships and Related Transactions, and Director Independence
Series A Preferred Stock
On August 12, 2022, Black Bird Biotech, Inc., a Nevada corporation (the “Company”), entered into six separate securities exchange agreements (collectively, the “Exchange Agreements”). Specifically, the Company entered into Exchange Agreements with (a) Fabian G. Deneault (the “Deneault Agreement”), President and a Director of the Company, (b) Newlan & Newlan, Ltd. (the “Newlan Agreement”), a law firm owned by Eric Newlan, Vice President, Secretary and a Director of the Company, and L. A Newlan, Jr., a Director of the Company, (c) William E. Sluss (the “Sluss Agreement”), Chief Financial Officer and a Director of the Company, (d) EFT Holdings, Inc. (the “EFT Holdings Agreement”), a company controlled by Jack Jie Qin, a Director of the Company, (e) EF2T, Inc. (the “EF2T Agreement”), a company owned by Mr. Qin, and (f) Astoria LLC (the “Astoria Agreement”), a company controlled by Mr. Qin.
Pursuant to the Exchange Agreements, the Company is to issue a total of 42,000 shares of its Series A Preferred Stock, in exchange for a total of 123,472,996 shares of its Common Stock, as follows:
Exchange Agreement
Number of Shares of
Common Stock Exchanged
Number of Shares of
Series A Preferred Stock Issued
Deneault Agreement
49,746,253 shares
14,250 shares
Newlan Agreement
49,317,406 shares
14,250 shares
Sluss Agreement
1,115,002 shares
1,000 shares
EFT Holdings Agreement
18,221,906 shares
9,778 shares
EF2T Agreement
2,240,768 shares
1,202 shares
Astonia Agreement
2,831,661 shares
1,520 shares
The Deneault Agreement and the Newlan Agreement were consummated in August 2022. The remainder of the Exchange Agreements were consummated in December 2022.
All 123,472,996 shares that were the subject of the Exchange Agreements were, upon the consummation of the respective Exchange Agreements, cancelled and returned to the status of authorized and unissued.
BB Potentials Acquisition
Four of our company’s Directors, Fabian G. Deneault, Eric Newlan, L. A. Newlan, Jr. and William E. Sluss, collectively owned, directly and indirectly, 75.33% of the then-issued and outstanding shares of common stock of BB Potentials and 100% of the issued and outstanding voting preferred stock of BB Potentials. Pursuant to the Merger Agreement with BB Potentials, Mr. Deneault, Eric Newlan, L. A. Newlan, Jr. and Mr. Sluss were issued a total of 100,178,661 shares our common stock. The table below sets forth information relating to such persons’ acquiring their respective shares of capital stock of BB Potentials and the number of shares of our common stock issued to each of them.
Name
Black Bird Capital Stock Beneficial Ownership
Total Consideration
Paid for Black Bird
Capital Stock
Common Stock
Issued Pursuant to
Merger Agreement
Fabian G. Deneault
Common Stock:
22,700,000 shares
Preferred Stock:
500,000 shares
$4,250 in cash
49,746,253 shares
Eric Newlan
Common Stock:
11,250,000 shares (1)
Preferred Stock:
250,000 shares (1)
$125 in cash
24,658,703 shares (2)
L. A. Newlan, Jr.
Common Stock:
11,250,000 shares (1)
Preferred Stock:
250,000 shares (1)
$125 in cash
24,658,703 shares (3)
William E. Sluss
Common Stock:
520,000 shares
Consulting services
valued at $7,000
1,115,002 shares
(1)
These shares were purchased of record by Newlan & Newlan, Ltd., a law firm owned by Eric Newlan and L. A. Newlan, Jr.
(2)
These shares are owned of record by Newlan & Newlan, Ltd., a law firm owned by Eric Newlan and L. A. Newlan, Jr.
(3)
These shares are owned of record by Newlan & Newlan, Ltd., a law firm owned by Eric Newlan and L. A. Newlan, Jr. However, 21,442,356 of these shares are beneficially owned by Cruciate Irrevocable Trust, of which trust L. A. Newlan, Jr. is a trustee.
Loans from Related Parties
During the year ended December 31, 2021, we obtained an advance from one of our officers and directors, Eric Newlan, as follows:
In June 2021, Mr. Newlan advanced the sum of $93,732.70 to the Company. The funds were used to repay the EMA Financial Note (the total repayment amount was $93,697.70: $61,119.80 in principal; $3,499.30 in interest; and $29,078.60 as a prepayment premium). Such funds were obtained as a loan on open account, accrue no interest and are due on demand. At December 31, 2021, such loan had been repaid in full, in the amount of $93,697.70.
During the years ended December 31, 2021 and 2020, advances of $772 and $6,670 were received from Astonia LLC. Astonia LLC is considered a “related party,” due to the fact that a Director of our company, Jack Jie Qin, is the manager of Astonia LLC. The amounts due Astonia LLC bear interest at 5% per year and have a maturity of one year. As of December 31, 2022 and 2021, the Company owed Astonia LLC $5,242 and $5,242 in principal, respectively, and $491 and $268 in accrued and unpaid interest, respectively.
During the year ended December 31, 2019, advances of $22,676 were received from EFT Holdings, Inc. Also during the year ended December 31, 2019, the Company repaid $139,611 in loans due to EFT Holdings, Inc. The amounts due EFT Holdings, Inc. carried an interest rate of 5% per year, were secured by all future sales of the Company and had a maturity of one year. As of December 31, 2019, the Company owed EFT Holdings, Inc. $251,785 in accrued and unpaid interest. $-0- of these EFT Holdings, Inc. advances at December 31, 2019, were past due and payable upon demand. In conjunction with the BB Potentials acquisition, all amounts owed to EFT Holdings, Inc. as of December 31, 2019, were extinguished. (See “Debt Forgiveness Agreements with Related Parties” below).
During the year ended December 31, 2019, advances of $64,500 were received from EF2T, Inc. The amounts due EF2T, Inc. carried an interest rate of 5% per year, were secured by all future sales of the Company and had a maturity of one year. As of December 31, 2019, the Company owed EF2T, Inc. $4,742 in accrued and unpaid interest. In conjunction with the BB Potentials acquisition, all amounts owed to EF2T, Inc. as of December 31, 2019, were extinguished. (See “Debt Forgiveness Agreements with Related Parties” below).
During the year ended December 31, 2019, advances of $135,000 were received from Astonia, LLC. Astonia, LLC is considered a “related party”, due to the fact that a Director of the Company, Jack Jie Qin, is the manager of Astonia. The amounts due Astonia, LLC carried an interest rate of 5% per year, were secured by all future sales of the Company and had a maturity of one year. As of December 31, 2019, the Company owed Astonia $1,997 in accrued and unpaid interest. In conjunction with the BB Potentials acquisition, all amounts owed to Astonia, LLC as of December 31, 2019, were extinguished. (See “Debt Forgiveness Agreements with Related Parties” below).
Debt Forgiveness Transactions with Related Parties
In conjunction with the BB Potentials acquisition, we entered into debt forgiveness agreements with related parties, as follows:
·
EFT Holdings, Inc.: we issued 18,221,906 shares of common stock to our former majority shareholder, EFT Holdings, Inc., in payment of $886,108 of indebtedness, principal and accrued interest, pursuant to a debt forgiveness agreement.
·
EF2T, Inc.: we issued 2,240,768 shares of common stock to a related party, EF2T, Inc., in payment of $109,992 of indebtedness, principal and accrued interest, pursuant to a debt forgiveness agreement.
·
Astonia LLC: we issued 2,831,661 shares of common stock to a related party, Astonia LLC, in payment of $136,997 of indebtedness, principal and accrued interest, pursuant to a debt forgiveness agreement.
Cancellation of Stock Transaction with Related Party
In conjunction with the BB Potentials acquisition, we entered into a cancellation of stock agreement with our former majority shareholder, EFT Holdings, Inc., whereby we cancelled all 79,265,000 shares of common stock then owned by EFT Holdings, Inc.
MiteXstream Agreements
Effective January 1, 2019, BB Potentials entered into a Distribution and Private Label Agreement (the “Original MiteXstream Agreement”) with Thoreauvian Product Services, LLC (“TPS”), a company controlled by two of our company’s officers and directors, Fabian G. Deneault and Eric Newlan, relating to the licensed biopesticide product, MiteXstream (the “Private Label Product”). The Original MiteXstream Agreement had an initial term of 10 years and a single 10-year renewal term. Under the Original MiteXstream Agreement, BB Potentials had the exclusive right to distribute and sell the Private Label Product in the United States and Canada. In addition, BB Potentials was required to pay a $20,000 exclusivity fee and to purchase $20,000 of the Private Label Product in conjunction with the signing of the Original MiteXstream Agreement and to purchase not less than $20,000 of the Private Label Product each year. Further, BB Potentials was required to pay all costs in excess of $20,000 associated with MiteXstream’s becoming approved by the U.S. EPA (and relevant states) as a pesticide.
In February 2021, the Original MiteXstream Agreement was replaced with a similar agreement, a Manufacturing, Sales and Distribution License Agreement (the “New MiteXstream Agreement”), between BB Potentials and Touchstone Enviro Solutions Inc. (Touchstone), the parent company of TPS, which served to expand BB Potentials’ rights with respect to MiteXstream, an EPA-registered biopesticide. The New MiteXstream Agreement contains the following important provisions as compared to the Original MiteXstream Agreement:
New MiteXstream Agreement
Original MiteXstream Agreement
Term
December 31, 2080
Initial terms of 10 years, with one 10-year renewal term
Territory
Worldwide Exclusive (1)
United States and Canada
Royalty
$10.00 per gallon manufactured
Effective royalty of an estimated $50 per gallon
Minimums
2,500 gallons of concentrate manufactured per year (2)
$20,000 of product per year
Sublicensing
Right to sublicense granted
No right to sublicense
Trademarks
For no extra consideration, rights granted to use “MiteXstream” and “Harnessing the Power of Water”
For no extra consideration, rights granted to use “MiteXstream”
(1)
Exclusivity ends and becomes non-exclusive, if the minimum of 2,500 gallons per year is not met.
(2)
The minimum (2,500 gallons per year) is deemed to have been satisfied through December 31, 2022.
The disinterested Directors of our company approved the New MiteXstream Agreement.
Employment Agreement
We have entered into an employment agreement with one of our executive officers, William J. LoBell. Our agreement with Mr. LoBell is for a two-year term, beginning in April 2022. Under the agreement, Mr. LoBell was issued 1,000,000 shares of our common stock as a signing bonus and he is to be issued 500,000 shares of our common stock on the first day of July 2022, October 2022, January 2023 and April 2023. By the terms of the agreement, all shares of common stock issued to Mr. LoBell are valued at $0.01 per share. Additionally, Mr. LoBell is to be paid a monthly salary of $5,000.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Item 14. Principal Accountant Fees and Services
The following table sets forth fees billed to us by our independent auditors during the fiscal years ended December 31, 2022 and 2021, for: (a) services rendered for the audit of our annual financial statements and the review of our quarterly financial statements, (b) services by our auditors that are reasonably related to the performance of the audit or review of our financial statements and that are not reported as Audit Fees, (c) services rendered in connection with tax compliance, tax advice and tax planning and (d) all other fees for services rendered.
Year Ended December 31, 2022
Year Ended December 31, 2021
Audit Fees
$ 50,000
$ 31,000
Audit Related Fees
$ 0
$ 0
Tax
$ 0
$ 0
All Other Fees
$ 0
$ 0
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Item 15. Exhibits and Financial Statement Schedules
The following documents are filed as part of this Annual Report on Form 10-K:
(1)
Financial Statements (included in Item 8):
Black Bird Biotech, Inc. - Audited Financial Statements for the Years Ended December 31, 2022 and 2021
Report of Independent Registered Public Accounting Firm
Balance Sheets at December 31, 2022 and 2021
Statements of Operations for the Years Ended December 31, 2022 and 2021
Statement of Changes in Stockholders’ Equity (Deficit) for the Years Ended December 31, 2022 and 2021
Statements of Cash Flows for the Years Ended December 31, 2022 and 2021
Notes to Financial Statements
(2)
Financial Statement Schedules: None
(3)
Exhibits:
Exhibit No.
Description
21.1 *
Subsidiaries of Black Bird Biotech, Inc.
31.1 *
CEO Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
31.2 *
CFO Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.1 *
Certification pursuant to 18 U.S.C. Section 1350
101.INS *
XBRL Instance Document
101.SCH *
XBRL Taxonomy Extension Schema Document
101.CAL *
XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF *
XBRL Taxonomy Extension Definitions Linkbase Document
101.LAB *
XBRL Taxonomy Extension Label Linkbase Document
101.PRE *
XBRL Taxonomy Extension Presentation Linkbase Document
__________________________
* Filed herewith.
+ Incorporated by reference as indicated.