This is the public offering of securities
of B2Digital, Incorporated, a Delaware corporation. We are offering 600,000,000 shares of our common stock, par value $0.00001
(“Common Stock”), at an offering price of $0.0075 per share (the “Offered Shares”) by the
Company. This Offering will terminate on twelve months from the day the Offering is qualified or the date on which the maximum
offering amount is sold (such earlier date, the “Termination Date”). The minimum purchase requirement per investor
is 100,000 Offered Shares ($750); however, we can waive the minimum purchase requirement on a case-by-case basis in our sole discretion.
The proceeds of this offering will not
be placed into an escrow account. We will offer our Common Stock on a best efforts basis. As there is no minimum offering, upon
the approval of any subscription to this Offering Circular, the Company shall immediately deposit said proceeds into the bank account
of the Company and may dispose of the proceeds in accordance with the Use of Proceeds.
Subscriptions are irrevocable and the purchase
price is non-refundable as expressly stated in this Offering Circular. All proceeds received by the Company from subscribers for
this Offering will be available for use by the Company upon acceptance of subscriptions for the Securities by the Company.
Sale of these shares will commence within
two calendar days of the qualification date and it will be a continuous Offering pursuant to Rule 251(d)(3)(i)(F).
This Offering will be conducted on a “best-efforts”
basis, which means our Officers will use their commercially reasonable best efforts in an attempt to offer and sell the Shares.
Our Officers will not receive any commission or any other remuneration for these sales. In offering the securities on our behalf,
the Officers will rely on the safe harbor from broker-dealer registration set out in Rule 3a4-1 under the Securities Exchange Act
of 1934, as amended.
Our Common Stock is traded in the OTC Market
Pink Open Market under the stock symbol “BTDG.”
Our Board of Directors used its business
judgment in setting a value of $0.0075 per share to the Company as consideration for the stock to be issued under the Offering.
The sales price per share bears no relationship to our book value or any other measure of our current value or worth.
This Offering Circular follows the disclosure
format prescribed by Part I of Form S-1 pursuant to the general instructions of Part II(a)(1)(ii) of Form 1-A.
We are offering to sell, and seeking offers
to buy, our securities only in jurisdictions where such offers and sales are permitted. You should rely only on the information
contained in this Offering Circular. We have not authorized anyone to provide you with any information other than the information
contained in this Offering Circular. The information contained in this Offering Circular is accurate only as of its date, regardless
of the time of its delivery or of any sale or delivery of our securities. Neither the delivery of this Offering Circular nor any
sale or delivery of our securities shall, under any circumstances, imply that there has been no change in our affairs since the
date of this Offering Circular. This Offering Circular will be updated and made available for delivery to the extent required by
the federal securities laws.
In this Offering Circular, unless the context
indicates otherwise, references to “B2Digital”, “we”, the “Company”, “our” and
“us” refer to the activities of and the assets and liabilities of the business and operations of B2Digital, Incorporated
Some of the statements under “Summary”,
“Risk Factors”, “Management's Discussion and Analysis of Financial Condition and Results of Operations”,
“Our Business” and elsewhere in this Offering Circular constitute forward-looking statements. Forward-looking statements
relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar matters that
are not historical facts. In some cases, you can identify forward-looking statements by terms such as “anticipate”,
“believe”, “could”, “estimate”, “expect”, “intend”, “may”,
“plan”, “potential”, “should”, and “would” or the negatives
of these terms or other comparable terminology.
You should not place undue reliance on
forward-looking statements. The cautionary statements set forth in this Offering Circular, including in “Risk Factors”
and elsewhere, identify important factors, which you should consider in evaluating our forward-looking statements. These factors
include, among other things:
Although the forward-looking statements
in this Offering Circular are based on our beliefs, assumptions and expectations, taking into account all information currently
available to us, we cannot guarantee future transactions, results, performance, achievements or outcomes. No assurance can be made
to any investor by anyone that the expectations reflected in our forward-looking statements will be attained, or that deviations
from them will not be material and adverse. We undertake no obligation, other than as maybe be required by law, to re-issue this
Offering Circular or otherwise make public statements updating our forward-looking statements.
The Company, sometimes referred to herein
as “we,” “us,” “our,” and the “Company” and/or “B2Digital” was incorporated
on October 22, 1991 under the laws of the State of Delaware, to engage in any lawful corporate undertaking. Our fiscal year-end
date is March 31.
B2Digital, Incorporated offices are located
at 4522 West Village Drive Suite 215. Tampa, Florida 33624, Telephone: (813) 961-3051 and our email address is gbell@b3enterprises.net.
In February 2017, the Board of Directors
approved a complete restructuring, new management team and strategic direction for the company. Capitalizing on its history in
television, video and technology, the company is now forging ahead and becoming a full-service Live Event Sports Company.
B2Digital, Incorporated. was incorporated
as a Delaware corporation on June 3, 2004. Historically, the Company had been a provider of in-room, on-demand video entertainment
and satellite services to the domestic lodging industry. In the past, the Company had provided the video services to over 50,000
hotel rooms in the lodging industry. Pay-Per View lost a great deal of market share due to the increased Internet use by hotel
guests. With this loss, the Company’s Board of Directors agreed to dissolve Hotel Movie Network on March 11, 2010.
In February 2017, the Issuer’s Board
of Directors approved a complete restructuring, new management team and strategic direction for the company. Capitalizing on its
history in television, video and technology, the Issuer is now forging ahead and becoming a full-service live event sports company.
Since the restructuring, the Company has
been led by a management team headed by the Company’s Chairman and CEO, Greg P. Bell. The management team has over 30 years
of global experience developing more than 20 companies in the Sports, Television, Entertainment, Digital Distribution and Banking
Transaction industries. As part of its growth strategy, B2Digital intends to continue to develop and acquire assets meeting its
business model with the goal of becoming a Premier Vertically Integrated LIVE Event Sports Company.
With extensive background in entertainment,
television, video and technology, the Company is now forging ahead and becoming a full-service Live Event Sports Company. The current
Chairman and CEO of the Company is Greg P. Bell. Capitalizing on the combination of his expertise, relationships and experience
as well as his involvement with more than 40,000 LIVE events over his career for major sports leagues and entertainment venues,
B2Digital is in the process of developing and acquiring companies to become a Premier Vertically Integrated LIVE Event Sports Company.
B2Digital's first strategy is to build an integrated LIVE Event Minor League for the MMA Mixed Martial Arts marketplace, which
is a billion-dollar industry.
B2Digital will be creating and developing
Minor League champions that will move on to the MMA Major Leagues from the B2FS, B2 Fighting Series. In 2017, B2Digital started
operating LIVE MMA Events by acquiring additional existing MMA Promotions. These acquisitions which facilitate the best Fighters
being invited annually to the yearly B2FS National Championship Live Event. B2Digital owns all media rights, merchandising rights,
digital distribution networks of the B2 Fighting Series. B2Digital is developing the Systems and Technologies for Event Management,
Digital Ticketing Sales, Digital Video Distribution, Digital Marketing, PPV, Fighter Management, Merchandise Sales, Brand Management
and Financial Control Systems.
The officers and directors currently have
voting control of the Company, including ownership of 2,000,000 shares of Series A Preferred Stock are currently issued and outstanding
which votes with the Common Stock on all matters to be voted on by the Common Stock on an as-converted basis. On such matters,
each holder of Series A Preferred Stock is entitled to 240 votes for each share of Series A Preferred Stock held by such shareholder.
If all of the shares offered in this Offering are sold the officers and directors will control 66.70% of all votes.
B2Digital will also be developing and
expanding the B2 LIVE Event Systems and Technologies. These include Systems for Event Management, Digital Ticketing Sales, Digital
Video Distribution, Digital Marketing, PPV (Pay per View), Fighter Management, Merchandise Sales, Brand Management and Financial
Control Systems.
Our shares are covered by section 15(g)
of the Securities Exchange Act of 1934, as amended that imposes additional sales practice requirements on broker/dealers who sell
such securities to persons other than established customers and accredited investors (generally institutions with assets in excess
of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with
their spouses). For transactions covered by the Rule, the broker/dealer must make a special suitability determination for the purchase
and have received the purchaser's written agreement to the transaction prior to the sale. Consequently, the Rule may affect the
ability of broker/dealers to sell our securities and also may affect your ability to sell your shares in the secondary market.
Section 15(g) also imposes additional sales
practice requirements on broker/dealers who sell penny securities. These rules require a one-page summary of certain essential
items. The items include the risk of investing in penny stocks in both public offerings and secondary marketing; terms important
to in understanding of the function of the penny stock market, such as bid and offer quotes, a dealers spread and broker/dealer
compensation; the broker/dealer compensation, the broker/dealers’ duties to its customers, including the disclosures required
by any other penny stock disclosure rules; the customers’ rights and remedies in cases of fraud in penny stock transactions;
and, the FINRA’s toll free telephone number and the central number of the North American Securities Administrators Association,
for information on the disciplinary history of broker/dealers and their associated persons.
The Company has not declared or paid a
cash dividend to stockholders since it was organized and does not intend to pay dividends in the foreseeable future. The board
of directors presently intends to retain any earnings to finance our operations and does not expect to authorize cash dividends
in the foreseeable future. Any payment of cash dividends in the future will depend upon the Company's earnings, capital requirements
and other factors.
Our Common Stock trades in the OTC Market
Pink Open Market under the symbol “BTDG.”
THE OFFERING
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Issuer:
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B2Digital, Incorporated
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Securities offered:
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A maximum of 600,000,000 shares of our common stock, par value $0.00001 (the “Common Stock”) at an offering price of $0.0075 per share (the “Offered Shares”). (See “Distribution.”)
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Number of shares of Common Stock outstanding before the offering
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581,003,354 shares of Common Stock issued and outstanding as December 13, 2019.
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Number of shares of Common Stock to be outstanding after the offering
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1,181,003,354 shares of Common Stock, if the maximum amount of Offered Shares are sold.
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Price per share:
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$0.0075
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Maximum offering amount for the Company:
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600,000,000 shares at $0.0075 per share, or $4,500,000 (See “Distribution.”)
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Trading Market:
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Our Common Stock is trading on the OTC Markets Pink Open Market under the symbol “BTDG.”
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Use of proceeds:
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If we sell all of the shares being offered, our net proceeds (after our estimated offering expenses) will be $3,750,000. We will use these net proceeds for working capital and other general corporate purposes.
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Risk factors:
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Investing in our Common Stock involves a high degree of risk,
including:
Immediate and substantial dilution.
Limited market for our stock.
See “Risk Factors.”
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RISK FACTORS
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The following is only a brief summary
of the risks involved in investing in our Company. Investment in our Securities involves risks. You should carefully consider
the following risk factors in addition to other information contained in this Offering Circular. The occurrence of any of the
following risks might cause you to lose all or part of your investment. Some statements in this Offering Circular, including statements
in the following risk factors, constitute “Forward-Looking Statements.”
The price of our common stock may
continue to be volatile.
The trading price of our common stock has
been and is likely to remain highly volatile and could be subject to wide fluctuations in response to various factors, some of
which are beyond our control or unrelated to our operating performance. In addition to the factors discussed in this “Risk
Factors” section and elsewhere, these factors include: the operating performance of similar companies; the overall performance
of the equity markets; the announcements by us or our competitors of acquisitions, business plans, or commercial relationships;
threatened or actual litigation; changes in laws or regulations relating to the our business; any major change in our board of
directors or management; publication of research reports or news stories about us, our competitors, or our industry or positive
or negative recommendations or withdrawal of research coverage by securities analysts; large volumes of sales of our shares of
common stock by existing stockholders; and general political and economic conditions.
In addition, the stock market in general,
and the market for developmental related companies in particular, has experienced extreme price and volume fluctuations that have
often been unrelated or disproportionate to the operating performance of those companies securities. This litigation, if instituted
against us, could result in very substantial costs; divert our management’s attention and resources; and harm our business,
operating results, and financial condition.
There are doubts about our ability
to continue as a going concern.
The
Company is a development stage enterprise and has commenced planned principal operations. The Company has realized minimal revenues
and has incurred losses of $904,927 for the six months ended September 30, 2019. In addition, the Company incurred losses of $3,367,295
for the period since inception through September 30, 2019. These factors raise substantial doubt about the Company’s ability
to continue as a going concern.
There can be no assurance that sufficient
funds required during the next year or thereafter will be generated from operations or that funds will be available from external
sources, such as debt or equity financings or other potential sources. The lack of additional capital resulting from the inability
to generate cash flow from operations, or to raise capital from external sources would force the Company to substantially curtail
or cease operations and would, therefore, have a material adverse effect on its business. Furthermore, there can be no assurance
that any such required funds, if available, will be available on attractive terms or that they will not have a significant dilutive
effect on the Company’s existing stockholders.
The Company intends to overcome the circumstances
that impact its ability to remain a going concern through a combination of the commencement of revenues, with interim cash flow
deficiencies being addressed through additional equity and debt financing. The Company anticipates raising additional funds through
public or private financing, strategic relationships or other arrangements in the near future to support its business operations;
however, the Company may not have commitments from third parties for a sufficient amount of additional capital. The Company cannot
be certain that any such financing will be available on acceptable terms, or at all, and its failure to raise capital when needed
could limit its ability to continue its operations. The Company’s ability to obtain additional funding will determine its
ability to continue as a going concern. Failure to secure additional financing in a timely manner and on favorable terms would
have a material adverse effect on the Company’s financial performance, results of operations and stock price and require
it to curtail or cease operations, sell off its assets, seek protection from its creditors through bankruptcy proceedings, or otherwise.
Furthermore, additional equity financing may be dilutive to the holders of the Company’s common stock, and debt financing,
if available, may involve restrictive covenants, and strategic relationships, if necessary to raise additional funds, and may require
that the Company relinquish valuable rights. Please see Financial Statements – Note 1. Operations and Basis of Presentation
– Going Concern for further information.
Risks Related
to Our Business
The Company
may fail to consummate its planned acquisitions, which could have a material adverse impact on its earnings and results of operations.
The Company may fail to consummate acquisitions
as planned. Because acquisitions are subject to a variety of factors, including the Company's ongoing due diligence and the satisfaction
of customary closing conditions, many of which are outside of the Company's control.
If the Company is unable to complete the
planned acquisitions, it may experience delays in locating and securing attractive alternative investments in which to invest the
net proceeds of this Offering. The Company's failure to apply a substantial portion of the net proceeds of this Offering effectively
or to find suitable uses for the net proceeds in a timely manner or on acceptable terms could result in returns that are substantially
below expectations, or result in losses.
Furthermore, acquisitions,
whether or not they are successful, require substantial time and attention from management of the Company. The Company may have
incurred significant legal, accounting and other transaction costs in connection with a transaction without realizing a corresponding
increase in its earnings and cash flow from the acquisition. As a result, the Company's failure to consummate an acquisition could
have a material adverse impact on the Company's results of operations and earnings.
The success
of our business is subject to the continued success and popularity of Mixed Martial Arts ("MMA").
MMA is currently a
popular sport in the United States, but our business is affected by consumer tastes and sports and entertainment trends, which
are unpredictable and subject to change. Any decline in the popularity of MMA, changes in our fans' and customers' tastes or a
material change in the perceptions of the MMA industry, whether due to internal or external factors, could adversely affect our
operating results and have a material adverse effect on our business.
We may not
be able to attract and retain key professional MMA fighters.
Our business is dependent upon identifying;
recruiting and retaining highly regarded professional MMA fighters for our promotions. Fans and sponsors are attracted to events
featuring top fighters, and the value placed on a promotion's television and other media rights is dependent to a great extent
on the quality of the promotion's fighter roster. We may not be able to attract and retain key professional MMA fighters due to
competition with other regional promoters for the same fighters. Failing to put on events featuring top professional fighters could
adversely affect our operating results and have a material adverse effect on our business.
We may not
be able to attract sufficient promotional and advertising sponsorships or maintain such arrangements.
Our business strategy involves developing
sponsorship arrangements, or expanding existing sponsorship arrangements, in support of our network of live MMA events. We will
compete with larger, more established sports and entertainment organizations and media outlets for sponsorship and advertising
revenue. Many factors, including the popularity and perception of MMA and the perceived quality of our promotions, will significantly
affect our ability to secure and maintain important advertising and promotional arrangements. If we are unable to generate sponsorship
and promotional revenue and increase that revenue over time, our operating results and business will be adversely affected.
Future acquisitions
may result in potentially dilutive issuances of equity securities, the incurrence of indebtedness and increased amortization expense.
Future acquisitions
will likely result in issuances of equity securities, which may be dilutive to the equity interests of existing stockholders; the
incurrence of debt, which will require us to maintain cash flows sufficient to make payments of principal and interest; the assumption
of known and unknown liabilities; and the amortization of expenses related to intangible assets, all of which could have an adverse
effect on our business, financial condition and results of operations.
We may need
additional capital to support our operations or the growth of our business, and we cannot be certain that this capital will be
available on reasonable terms when required, or at all.
In order for us to
grow and successfully execute our business plan, we may require additional financing which may not be available or may not be available
on acceptable terms. If such financing is available, it may be dilutive to the equity interests of existing stockholders. Failure
to obtain financing may have a material adverse effect on our financial position. If we are unable to obtain adequate financing
or financing on terms satisfactory to us when we require it, our ability to continue to support the operation or growth of our
business could be significantly impaired and our operating results may be harmed.
We may be prohibited
from promoting and conducting our live events if we do not comply with applicable regulations.
In various states
in the United States and in some foreign jurisdictions, athletic commissions and other applicable regulatory agencies will require
us to obtain licenses for promoters, medical clearances and/or other permits or licenses for athletes and/or permits for events
in order for us to promote and conduct our live events. If we fail to comply with the regulations of a particular jurisdiction,
we may be prohibited from promoting and conducting live events in that jurisdiction. The inability to present live events over
an extended period of time or in a number of jurisdictions could lead to a decline in the revenue streams generated from our live
events, in which case our operating results would be adversely affected.
We could incur
substantial liability in the event of accidents or injuries occurring during our events.
We intend to hold numerous
live MMA events each year. Each live event will expose our employees who are involved in the production of those events to the
risk of travel and match-related accidents, the costs of which may not be fully covered by insurance. The physical nature of our
events will expose our professional MMA fighters to the risk of serious injury or death. Although our fighters, as independent
contractors, are responsible for maintaining their own health, disability and life insurance, we insure medical costs for injuries
that a fighter may suffer at our events. Any liability we incur as a result of the death of or a serious injury sustained by one
of our fighters while fighting in a match at our events, to the extent not covered by our insurance, could adversely affect our
business, financial condition and operating results.
Our live events will entail other risks
inherent in public live events, including air and land travel interruption or accidents, the spread of illness, injuries resulting
from building problems, equipment malfunction, terrorism or other violence, local labor strikes and other "force majeure"
type events. These circumstances could result in personal injuries or deaths, canceled events and other disruptions to our business
for which we do not carry business interruption insurance, or result in liability to third parties for which we may not have insurance.
The occurrence of any of these circumstances could adversely affect our business, financial condition and results of operations.
We may be unable
to establish, protect or enforce our intellectual property rights adequately.
Our success will depend in part on our
ability to establish, protect and enforce our intellectual property and other proprietary rights. Our inability to protect our
portfolio of copyrighted material, trade names and other intellectual property rights from infringement, piracy, counterfeiting
or other unauthorized use could negatively affect our business. If we fail to establish, protect or enforce our intellectual property
rights, we may lose an important advantage in the market in which we compete. Our intellectual property rights may not be sufficient
to help us maintain our position in the market and our competitive advantages. Monitoring unauthorized uses of and enforcing our
intellectual property rights can be difficult and costly. Legal intellectual property actions are inherently uncertain and may
not be successful, and may require a substantial amount of resources and divert our management's attention.
We rely on our
marketing efforts and channels to promote our brand and events. These efforts may require significant expense and may not be successful.
We will employ various
marketing tactics and use a variety of marketing channels to promote our brand, including sponsorships, advertisement, email and
social media marketing. If we lose access to one or more of these channels for any reason, we will not be able to promote our brand
or events effectively, which could limit our ability to grow. Further, if the marketing activities fail to generate traffic to
our events, attract new fans or lead to new and renewal sales for our events, our business and operating results could be affected.
There is no assurance in the results of our continuing marketing efforts. If customer acquisition cost increases, the operating
results could also be affected.
Risks Relating
to Our Financial Condition
Our management
has a limited experience operating a public company and are subject to the risks commonly encountered by early-stage companies.
Although management
of B2Digital, Incorporated has experience in operating small companies, current management has not had to manage expansion while
being a public company. Many investors may treat us as an early-stage company. In addition, management has not overseen a company
with large growth. Because we have a limited operating history, our operating prospects should be considered in light of the risks
and uncertainties frequently encountered by early-stage companies in rapidly evolving markets. These risks include:
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risks that we may not have sufficient capital to achieve our growth strategy;
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risks that we may not develop our product and service offerings in a manner that enables us to be profitable and meet our customers’ requirements;
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risks that our growth strategy may not be successful; and
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risks that fluctuations in our operating results will be significant relative to our revenues.
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These risks are
described in more detail below. Our future growth will depend substantially on our ability to address these and the other risks
described in this section. If we do not successfully address these risks, our business could be significantly harmed.
We have
limited operational history in an emerging industry, making it difficult to accurately predict and forecast business operations.
As we have limited
operations in our business and have yet to generate revenue, it is extremely difficult to make accurate predictions and forecasts
on our finances. This is compounded by the fact that we operate in a rapidly transforming industry. There is no guarantee that
our products or services will remain attractive to potential and current users as these industries undergo rapid change, or that
potential customers will utilize our services.
As a growing
company, we have yet to achieve a profit and may not achieve a profit in the near future, if at all.
We have not yet
produced a net profit and may not in the near future, if at all. While we expect our revenue to grow, we have not achieved profitability
and cannot be certain that we will be able to sustain our current growth rate or realize sufficient revenue to achieve profitability.
Our ability to continue as a going concern may be dependent upon raising capital from financing transactions, increasing revenue
throughout the year and keeping operating expenses below our revenue levels in order to achieve positive cash flows, none of which
can be assured.
We will
require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all.
We intend to continue
to make investments to support our business growth and may require additional funds to respond to business challenges, including
the need to update hardware, improve our operating infrastructure or acquire complementary businesses and technologies. Accordingly,
we will need to engage in continued equity or debt financings to secure additional funds. If we raise additional funds through
future issuances of equity or convertible debt securities, our existing stockholders could suffer significant dilution, and any
new equity securities we issue could have rights, preferences and privileges superior to those of our common stock. Any debt financing
we secure in the future could involve restrictive covenants relating to our capital raising activities and other financial and
operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities,
including potential acquisitions. We may not be able to obtain additional financing on terms favorable to us, if at all. If we
are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to continue to
support our business growth and to respond to business challenges could be impaired, and our business may be harmed.
We are highly dependent on the services
of our key executive, the loss of whom could materially harm our business and our strategic direction. If we lose key management
or significant personnel, cannot recruit qualified employees, directors, officers, or other personnel or experience increases in
our compensation costs, our business may materially suffer.
We are highly dependent on our management,
specifically Greg P. Bell. We have an Employment Agreement in place with Mr. Bell. If we lose key employees, our business may suffer.
Furthermore, our future success will also depend in part on the continued service of our management personnel and our ability to
identify, hire, and retain additional key personnel. We do not carry “key-man” life insurance on the lives of any of
our executives, employees or advisors. We experience intense competition for qualified personnel and may be unable to attract and
retain the personnel necessary for the development of our business. Because of this competition, our compensation costs may increase
significantly.
We may be unable to manage growth,
which may impact our potential profitability.
Successful implementation of our business
strategy requires us to manage our growth. Growth could place an increasing strain on our management and financial resources. To
manage growth effectively, we will need to:
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Establish definitive business strategies, goals and objectives;
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Maintain a system of management controls; and
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Attract and retain qualified personnel, as well as develop, train, and manage management-level and other employees.
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If we fail to manage our growth effectively,
our business, financial condition, or operating results could be materially harmed, and our stock price may decline.
We operate in a highly competitive
environment, and if we are unable to compete with our competitors, our business, financial condition, results of operations, cash
flows and prospects could be materially adversely affected.
We operate in a highly competitive environment.
Our competition includes all other companies that are in the business of entertainment events or other related companies. A highly
competitive environment could materially adversely affect our business, financial condition, results of operations, cash flows
and prospects.
We may not be able to compete successfully
with other established companies offering the same or similar services and, as a result, we may not achieve our projected revenue
and user targets.
If we are unable to compete successfully
with other businesses in our existing market, we may not achieve our projected revenue and/or customer targets. We compete with
both start-up and established companies. Compared to our business, some of our competitors may have greater financial and other
resources, have been in business longer, have greater name recognition and be better established.
Our lack of adequate D&O insurance
may also make it difficult for us to retain and attract talented and skilled directors and officers.
In the future we may be subject to additional
litigation, including potential class action and stockholder derivative actions. Risks associated with legal liability are difficult
to assess and quantify, and their existence and magnitude can remain unknown for significant periods of time. To date, we have
not obtained directors and officers liability (“D&O”) insurance. Without adequate D&O insurance, the amounts
we would pay to indemnify our officers and directors should they be subject to legal action based on their service to the Company
could have a material adverse effect on our financial condition, results of operations and liquidity. Furthermore, our lack of
adequate D&O insurance may make it difficult for us to retain and attract talented and skilled directors and officers, which
could adversely affect our business.
We expect to incur substantial expenses
to meet our reporting obligations as a public company. In addition, failure to maintain adequate financial and management processes
and controls could lead to errors in our financial reporting and could harm our ability to manage our expenses.
We estimate that it will cost approximately
$50,000 annually to maintain the proper management and financial controls for our filings required as a public reporting company.
In addition, if we do not maintain adequate financial and management personnel, processes and controls, we may not be able to accurately
report our financial performance on a timely basis, which could cause a decline in our stock price and adversely affect our ability
to raise capital.
Risks Relating to our Common Stock
and Offering
The Common Stock is thinly traded,
so you may be unable to sell at or near ask prices or at all if you need to sell your shares to raise money or otherwise desire
to liquidate your shares.
The Common Stock has historically been
sporadically traded on the OTC Markets, meaning that the number of persons interested in purchasing our shares at, or near ask
prices at any given time, may be relatively small or non-existent. This situation is attributable to a number of factors, including
the fact that we are a small company which is relatively unknown to stock analysts, stock brokers, institutional investors and
others in the investment community that generate or influence sales volume, and that even if we came to the attention of such persons,
they tend to be risk-averse and would be reluctant to follow an unproven company such as ours or purchase or recommend the purchase
of our shares until such time as we became more seasoned and viable. As a consequence, there may be periods of several days or
more when trading activity in our shares is minimal or non-existent, as compared to a seasoned issuer, which has a large and steady
volume of trading activity that will generally support continuous sales without an adverse effect on share price. We cannot give
you any assurance that a broader or more active public trading market for our common shares will develop or be sustained, or that
current trading levels will be sustained.
The market price for the common stock
is particularly volatile given our status as a relatively unknown company with a small and thinly traded public float, limited
operating history, and lack of revenue, which could lead to wide fluctuations in our share price. The price at which you purchase
our shares may not be indicative of the price that will prevail in the trading market. You may be unable to sell your common shares
at or above your purchase price, which may result in substantial losses to you.
The market for our shares of common stock
is characterized by significant price volatility when compared to seasoned issuers, and we expect that our share price will continue
to be more volatile than a seasoned issuer for the indefinite future. The volatility in our share price is attributable to a number
of factors. First, as noted above, our shares are sporadically traded. As a consequence of this lack of liquidity, the trading
of relatively small quantities of shares may disproportionately influence the price of those shares in either direction. The price
for our shares could, for example, decline precipitously in the event that a large number of our shares is sold on the market without
commensurate demand, as compared to a seasoned issuer which could better absorb those sales without adverse impact on its share
price. Secondly, we are a speculative investment due to, among other matters, our limited operating history and lack of revenue
or profit to date, and the uncertainty of future market acceptance for our potential products. As a consequence of this enhanced
risk, more risk-averse investors may, under the fear of losing all or most of their investment in the event of negative news or
lack of progress, be more inclined to sell their shares on the market more quickly and at greater discounts than would be the case
with the securities of a seasoned issuer. The following factors may add to the volatility in the price of our shares: actual or
anticipated variations in our quarterly or annual operating results; acceptance of our inventory of events, games; government regulations,
announcements of significant acquisitions, strategic partnerships or joint ventures; our capital commitments and additions or departures
of our key personnel. Many of these factors are beyond our control and may decrease the market price of our shares regardless of
our operating performance. We cannot make any predictions or projections as to what the prevailing market price for our shares
will be at any time, including as to whether our shares will sustain their current market prices, or as to what effect the sale
of shares or the availability of shares for sale at any time will have on the prevailing market price.
Shareholders should be aware that, according
to SEC Release No. 34-29093, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns
include (1) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer;
(2) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (3) boiler
room practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (4) excessive
and undisclosed bid-ask differential and markups by selling broker-dealers; and (5) the wholesale dumping of the same securities
by promoters and broker-dealers after prices have been manipulated to a desired level, along with the resulting inevitable collapse
of those prices and with consequent investor losses. Our management is aware of the abuses that have occurred historically in the
penny stock market. Although we do not expect to be in a position to dictate the behavior of the market or of broker-dealers who
participate in the market, management will strive within the confines of practical limitations to prevent the described patterns
from being established with respect to our securities. The possible occurrence of these patterns or practices could increase the
volatility of our share price.
The market price of our common stock
may be volatile and adversely affected by several factors.
The market price of our common stock could
fluctuate significantly in response to various factors and events, including, but not limited to:
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our ability to integrate operations, technology, products and services;
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our ability to execute our business plan;
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operating results below expectations;
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our issuance of additional securities, including debt or equity or a combination thereof;
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announcements of technological innovations or new products by us or our competitors;
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loss of any strategic relationship;
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industry developments, including, without limitation, changes in competition or practices;
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economic and other external factors;
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period-to-period fluctuations in our financial results; and
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whether an active trading market in our common stock develops and is maintained.
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In addition, the securities markets have
from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular
companies. These market fluctuations may also materially and adversely affect the market price of our common stock. Issuers using
the Alternative Reporting standard for filing financial reports with OTC Markets are often subject to large volatility unrelated
to the fundamentals of the company.
Natural disasters and geo-political
events could adversely affect our business.
Natural disasters, including hurricanes,
cyclones, typhoons, tropical storms, floods, earthquakes and tsunamis, weather conditions, including winter storms, droughts and
tornadoes, whether as a result of climate change or otherwise, and geo-political events, including civil unrest or terrorist attacks,
that affect us, or other service providers, could adversely affect our business.
We do not expect to pay dividends
in the future; any return on investment may be limited to the value of our common stock.
We do not currently anticipate paying cash
dividends in the foreseeable future. The payment of dividends on our common stock will depend on earnings, financial condition
and other business and economic factors affecting it at such time as the board of directors may consider relevant. Our current
intention is to apply net earnings, if any, in the foreseeable future to increasing our capital base and development and marketing
efforts. There can be no assurance that the Company will ever have sufficient earnings to declare and pay dividends to the holders
of our common stock, and in any event, a decision to declare and pay dividends is at the sole discretion of our board of directors.
If we do not pay dividends, our common stock may be less valuable because a return on your investment will only occur if its stock
price appreciates.
Our issuance of additional shares
of Common Stock, or options or warrants to purchase those shares, would dilute your proportionate ownership and voting rights.
We are entitled under our articles of
incorporation to issue up to 5,000,000,000 shares of common stock. We have issued and outstanding 581,003,354 shares of Common
Stock as of December 13, 2019. In addition, we are entitled under our Articles of Incorporation to issue “blank
check” preferred stock. Our board may generally issue shares of common stock, preferred stock, options, or warrants to purchase
those shares, without further approval by our shareholders based upon such factors as our board of directors may deem relevant
at that time. It is likely that we will be required to issue a large amount of additional securities to raise capital to further
our development. It is also likely that we will issue a large amount of additional securities to directors, officers, employees
and consultants as compensatory grants in connection with their services, both in the form of stand-alone grants or under our
stock plans. We cannot give you any assurance that we will not issue additional shares of common stock, or options or warrants
to purchase those shares, under circumstances we may deem appropriate at the time.
The elimination of monetary liability
against our directors, officers and employees under our Articles of Incorporation and the existence of indemnification rights to
our directors, officers and employees may result in substantial expenditures by our company and may discourage lawsuits against
our directors, officers and employees.
Our Articles of Incorporation contains
provisions that eliminate the liability of our directors for monetary damages to our company and shareholders. Our bylaws also
require us to indemnify our officers and directors. We may also have contractual indemnification obligations under our agreements
with our directors, officers and employees. The foregoing indemnification obligations could result in our company incurring substantial
expenditures to cover the cost of settlement or damage awards against directors, officers and employees that we may be unable to
recoup. These provisions and resulting costs may also discourage our company from bringing a lawsuit against directors, officers
and employees for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our shareholders
against our directors, officers and employees even though such actions, if successful, might otherwise benefit our company and
shareholders.
We may become involved in securities
class action litigation that could divert management’s attention and harm our business.
The stock market in general, and the shares
of early stage companies in particular, have experienced extreme price and volume fluctuations. These fluctuations have often been
unrelated or disproportionate to the operating performance of the companies involved. If these fluctuations occur in the future,
the market price of our shares could fall regardless of our operating performance. In the past, following periods of volatility
in the market price of a particular company’s securities, securities class action litigation has often been brought against
that company. If the market price or volume of our shares suffers extreme fluctuations, then we may become involved in this type
of litigation, which would be expensive and divert management’s attention and resources from managing our business.
As a public company, we may also from time
to time make forward-looking statements about future operating results and provide some financial guidance to the public markets.
Our management has limited experience as a management team in a public company and as a result, projections may not be made timely
or set at expected performance levels and could materially affect the price of our shares. Any failure to meet published forward-looking
statements that adversely affect the stock price could result in losses to investors, stockholder lawsuits or other litigation,
sanctions or restrictions issued by the SEC.
Our common stock is currently deemed
a “penny stock,” which makes it more difficult for our investors to sell their shares.
The SEC has adopted Rule 15g-9 which establishes
the definition of a “penny stock,” for the purposes relevant to us, as any equity security that has a market price
of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules
require that a broker or dealer approve a person’s account for transactions in penny stocks, and the broker or dealer receive
from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.
In order to approve a person’s account
for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of
the person and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person
has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.
The broker or dealer must also deliver,
prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which,
in highlight form sets forth the basis on which the broker or dealer made the suitability determination, and that the broker or
dealer received a signed, written agreement from the investor prior to the transaction.
Generally, brokers may be less willing
to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for investors
to dispose of our common stock if and when such shares are eligible for sale and may cause a decline in the market value of its
stock.
Disclosure also has to be made about the
risks of investing in penny stocks in both public offerings and in secondary trading, and about the commissions payable to both
the broker-dealer and the registered representative, current quotations for the securities, and the rights and remedies available
to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price
information for the penny stock held in the account and information on the limited market in penny stock.
As an issuer of a “penny stock,”
the protection provided by the federal securities laws relating to forward-looking statements does not apply to us.
Although federal securities laws provide
a safe harbor for forward-looking statements made by a public company that files reports under the federal securities laws, this
safe harbor is not available to issuers of penny stocks. As a result, we will not have the benefit of this safe harbor protection
in the event of any legal action based upon a claim that the material provided by us contained a material misstatement of fact
or was misleading in any material respect because of our failure to include any statements necessary to make the statements not
misleading. Such an action could hurt our financial condition.
Securities analysts may elect not
to report on our common stock or may issue negative reports that adversely affect the stock price.
At this time, no securities analysts provide
research coverage of our common stock, and securities analysts may not elect to provide such coverage in the future. It may remain
difficult for our company, with its small market capitalization, to attract independent financial analysts that will cover our
common stock. If securities analysts do not cover our common stock, the lack of research coverage may adversely affect the stock’s
actual and potential market price. The trading market for our common stock may be affected in part by the research and reports
that industry or financial analysts publish about our business. If one or more analysts elect to cover our company and then downgrade
the stock, the stock price would likely decline rapidly. If one or more of these analysts cease coverage of our company, we could
lose visibility in the market, which, in turn, could cause our stock price to decline. This could have a negative effect on the
market price of our common stock.
Because directors and officers currently
and for the foreseeable future will continue to control B2Digital, Incorporated, it is not likely that you will be able to elect
directors or have any say in the policies of B2Digital, Incorporated.
Even if all shares offered hereby are
sold, the current officers and directors will control 66.7% of all shareholder votes, see “Principal Shareholders.”
Our shareholders are not entitled to cumulative
voting rights. Consequently, the election of directors and all other matters requiring shareholder approval will be decided by
majority vote. The directors, officers and affiliates of B2Digital, Incorporated beneficially own a majority of our outstanding
common stock voting rights. Due to such significant ownership position held by our insiders, new investors may not be able to affect
a change in our business or management, and therefore, shareholders would have no recourse as a result of decisions made by management.
In addition, sales of significant amounts
of shares held by our directors, officers or affiliates, or the prospect of these sales, could adversely affect the market price
of our common stock. Management’s stock ownership may discourage a potential acquirer from making a tender offer or otherwise
attempting to obtain control of us, which in turn could reduce our stock price or prevent our stockholders from realizing a premium
over our stock price.
Risks Relating to Our Company and
Industry
The following risks relate to our proposed
business and the effects upon us assuming we obtain financing in a sufficient amount.
Intellectual property rights claims
may adversely affect an investment in us.
We are not aware of any intellectual property
claims that may prevent us from operating; however, third parties may assert intellectual property claims relating to our operation.
Regardless of the merit of an intellectual property or other legal action, any legal expenses to defend or payments to settle such
claims would be extremely expensive. Additionally, a meritorious intellectual property claim could prevent us from operating and
force us to liquidate. As a result, an intellectual property claim against us could adversely affect an investment in us.
Statements Regarding Forward-looking
Statements
______
This Offering Circular contains various
“forward-looking statements.” You can identify forward-looking statements by the use of forward-looking terminology
such as “believes,” “expects,” “may,” “would,” “could,” “should,”
“seeks,” “approximately,” “intends,” “plans,” “projects,” “estimates”
or “anticipates” or the negative of these words and phrases or similar words or phrases. You can also identify forward-looking
statements by discussions of strategy, plans or intentions. These statements may be impacted by a number of risks and uncertainties.
The
forward-looking statements are based on our beliefs, assumptions and expectations of our future performance taking into account
all information currently available to us. These beliefs, assumptions and expectations are subject to risks and uncertainties and
can change as a result of many possible events or factors, not all of which are known to us. If a change occurs, our business,
financial condition, liquidity and results of operations may vary materially from those expressed in our forward-looking statements.
You should carefully consider these risks before you make an investment decision with respect to our Securities. For a further
discussion of these and other factors that could impact our future results, performance or transactions, see the section entitled
“Risk Factors.”
USE OF PROCEEDS
If we sell all of the shares being offered,
our net proceeds (after our estimated offering expenses of $750,000) will be $3,090,000. We will use these net proceeds for the
following.
If 25% of the Shares offered are sold:
Percentage of
Offering Sold
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Offering
Proceeds
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Approximate
Offering Expenses
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Total Net
Offering Proceeds
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Principal Uses
of Net Proceeds
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Future acquisitions $200,000
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Acquisition of Fight Group $160,000
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Infrastructure/CAPEX $300,000
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Working capital $273,000
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25%
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$1,125,000
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$192,000
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$933,000
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$933,000
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If 50% of the Shares offered are sold:
Percentage of
Offering Sold
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Offering
Proceeds
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Approximate
Offering Expenses
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Total Net
Offering Proceeds
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Principal Uses
of Net Proceeds
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Future acquisitions $400,000
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Acquisition of Fight Group $600,000
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Infrastructure/CAPEX $400,000
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Working capital $550,000
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50%
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$2,250,000
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$300,000
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$1,950,000
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$1,950,000
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If 75% of the Shared offered are sold:
Percentage of
Offering Sold
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Offering
Proceeds
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Approximate
Offering Expenses
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Total Net
Offering Proceeds
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Principal Uses
of Net Proceeds
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Future acquisitions $600,000
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Acquisition of Fight Group $800,000
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Infrastructure/CAPEX $500,000
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Working capital $875,000
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75%
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$3,375,000
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$500,000.00
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$2,875,000
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$2,875,000
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If 100% of the Shares offered are sold
Percentage of
Offering Sold
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Offering
Proceeds
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Approximate
Offering Expenses
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Total Net
Offering Proceeds
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Principal Uses
of Net Proceeds
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Future acquisitions $800,000
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Acquisition of Fight Group $1,000,000
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Infrastructure/CAPEX $700,000
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Working capital $1,250,000
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100%
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$4,500,000
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$750,000
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$3,750,000
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$3,750,000
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The precise amounts that we will devote
to each of the foregoing items, and the timing of expenditures, will vary depending on numerous factors.
As indicated in the table above, if we
sell only 75%, or 50%, or 25% of the shares offered for sale in this offering, we would expect to use the resulting net proceeds
for the same purposes as we would use the net proceeds from a sale of 100% of the shares, and in approximately the same proportions,
until such time as such use of proceeds would leave us without working capital reserve. At that point we would expect to modify
our use of proceeds by limiting our expansion, leaving us with the working capital reserve indicated.
The expected use of net proceeds from this
offering represents our intentions based upon our current plans and business conditions, which could change in the future as our
plans and business conditions evolve and change. The amounts and timing of our actual expenditures, specifically with respect to
working capital, may vary significantly depending on numerous factors. The precise amounts that we will devote to each of the foregoing
items, and the timing of expenditures, will vary depending on numerous factors. As a result, our management will retain broad discretion
over the allocation of the net proceeds from this offering.
In the event we do not sell all of the
shares being offered, we may seek additional financing from other sources in order to support the intended use of proceeds indicated
above. If we secure additional equity funding, investors in this offering would be diluted. In all events, there can be no assurance
that additional financing would be available to us when wanted or needed and, if available, on terms acceptable to us. We
do not expect to use material amounts of other funds in conjunction with the proceeds.
We intend to expand by acquiring local
fight groups. Generally, we pay a portion of their purchase price in cash which represents an amount close
to the value of their net assets plus a portion of the purchase price in stock which represents three to four times the value
of their net assets.
We do not have a current agreement
to acquire a Fight Group. The reference to an acquisition of a Fight Group in this Use of Proceeds discussion does not indicate
a current plan to acquire a specific local fight group.
DILUTION
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If you purchase shares in this offering,
your ownership interest in our Common Stock will be diluted immediately, to the extent of the difference between the price to the
public charged for each share in this offering and the net tangible book value per share of our Common Stock after this offering.
Our historical net tangible book value
as of September 30, 2019 was $167,495 based on 563,120,110 outstanding shares of
our Common Stock outstanding on September 30, 2019. Historical net tangible book value per share equals the amount of our total
tangible assets less total liabilities, divided by the total number of shares of our Common Stock outstanding, all as of the date
specified.
The following table illustrates the
per share dilution to new investors discussed above, assuming the sale of, respectively, 100%, 75%, 50% and 25% of the shares
offered for sale in this offering (after deducting estimated offering expenses of $750,000):
Percentage of shares offered that are sold
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100%
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75%
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50%
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25%
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Price to the public charged for each share in this offering
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$0.0075
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$0.0075
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$0.0075
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$0.0075
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Historical net tangible book value per share as of September 30, 2019 (1)
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$0.0003
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$0.0003
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$0.0003
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$0.0003
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Increase in net tangible book value per share attributable to new investors in this offering (2)
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0.0031
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0.0024
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0.0016
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0.0004
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Net tangible book value per share, after this offering
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0.0034
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0.0027
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0.0019
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0.0007
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Dilution per share to new investors
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$0.0041
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$0.0048
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$0.0056
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$0.0068
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__________________________
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(1)
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Based on net tangible shareholders equity book value as of September 30, 2019 of $167,495 or $0.0003 based on 563,120,110 outstanding shares of Common Stock.
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(2)
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After deducting estimated offering expenses of $750,000.
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DISTRIBUTION
This Offering
Circular is part of an Offering Statement that we filed with the SEC, using a continuous offering process. Periodically, as we
have material developments, we will provide an Offering Circular supplement that may add, update or change information contained
in this Offering Circular. Any statement that we make in this Offering Circular will be modified or superseded by any inconsistent
statement made by us in a subsequent Offering Circular supplement. The Offering Statement we filed with the SEC includes exhibits
that provide more detailed descriptions of the matters discussed in this Offering Circular. You should read this Offering Circular
and the related exhibits filed with the SEC and any Offering Circular supplement, together with additional information contained
in our annual reports, semi-annual reports and other reports and information statements that we will file periodically with the
SEC. See the section entitled “Additional Information” below for more details.
Pricing of the Offering
Prior to the Offering, there has been a
limited public market for the Offered Shares. The initial public offering price was determined by negotiation between us and the
Underwriter. The principal factors considered in determining the initial public offering price include:
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the information set forth in this Offering Circular and otherwise available;
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our history and prospects and the history of and prospects for the industry in which we compete;
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our past and present financial performance;
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our prospects for future earnings and the present state of our development;
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the general condition of the securities markets at the time of this Offering;
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the recent market prices of, and demand for, publicly traded common stock of generally comparable companies; and
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other factors deemed relevant by us.
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Offering Period and Expiration Date
This Offering will start on or after the
Qualification Date and will terminate when the maximum offering is reached or, if it is not reached, on the Termination Date.
Procedures for Subscribing
When you decide to subscribe for Offered
Shares in this Offering, you should:
Go to https://www.sec.gov/Archives/edgar/data/725929/000168316819001684/b2digital_253g2-ex0401.htm
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1.
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Electronically download and receive, review, execute and deliver to us a subscription agreement; and
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2.
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Deliver funds directly by wire or electronic funds transfer via ACH to the specified account maintained by us.
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Any potential investor will have ample
time to review the subscription agreement, along with their counsel, prior to making any final investment decision. We shall only
deliver such subscription agreement upon request after a potential investor has had ample opportunity to review this Offering Circular.
Right to Reject Subscriptions. After
we receive your complete, executed subscription agreement and the funds required under the subscription agreement have been transferred
to the escrow account, we have the right to review and accept or reject your subscription in whole or in part, for any reason or
for no reason. We will return all monies from rejected subscriptions immediately to you, without interest or deduction.
Acceptance of Subscriptions. Upon
our acceptance of a subscription agreement, we will countersign the subscription agreement and issue the shares subscribed at closing.
Once you submit the subscription agreement and it is accepted, you may not revoke or change your subscription or request your subscription
funds. All accepted subscription agreements are irrevocable.
Under Rule 251 of Regulation A, non-accredited
investors are subject to the investment limitation and may only invest funds which do not exceed 10% of the greater of the purchaser's
revenue or net assets (as of the purchaser's most recent fiscal year end). A non-accredited, natural person may only invest funds
which do not exceed 10% of the greater of the purchaser's annual income or net worth.
NOTE: For the purposes of calculating your
net worth, it is defined as the difference between total assets and total liabilities. This calculation must exclude the value
of your primary residence and may exclude any indebtedness secured by your primary residence (up to an amount equal to the value
of your primary residence). In the case of fiduciary accounts, net worth and/or income suitability requirements may be satisfied
by the beneficiary of the account or by the fiduciary, if the fiduciary directly or indirectly provides funds for the purchase
of the Offered Shares.
In order to purchase offered Shares
and prior to the acceptance of any funds from an investor, an investor will be required to represent, to the Company's satisfaction,
that he is either an accredited investor or is in compliance with the 10% of net worth or annual income limitation on investment
in this Offering.
No Escrow
The proceeds of this offering will not
be placed into an escrow account. We will offer our Common Stock on a best efforts basis primarily through an online platform.
As there is no minimum offering, upon the approval of any subscription to this Offering Circular, the Company shall immediately
deposit said proceeds into the bank account of the Company and may dispose of the proceeds in accordance with the Use of Proceeds.
The Offering
This Offering in being conducted on
a "best-efforts" basis.
Our officers are relying upon SEC Rule
3a4-1 under the Securities Exchange Act of 1934. The officers of the Company will not be deemed to be brokers solely by reason
of their participation in the sale of the securities. The officers are not subject to a statutory disqualification; and they will
not be compensated in connection with their participation by the payment of commissions or other remuneration based
either directly or indirectly on transactions in securities; and are not at the time of their participation an associated person
of a broker or dealer. They will perform substantial duties for or on behalf of the issuer otherwise than in connection
with transactions in securities. They were not a broker or dealer, or an associated person of a broker or dealer, within
the preceding 12 months. They will not participate in selling an offering of securities for any issuer more than once every 12
months. They will restrict their participation to any one or more of the following activities: (a) preparing any written
communication or delivering such communication through the mails or other means that does not involve oral solicitation by
the associated person of a potential purchaser; (b) responding to inquiries of a potential purchaser in a communication
initiated by the potential purchaser; Provided, however, that the content of such responses are limited to information
contained in a Offering Statement filed under the Securities Act of 1933 or other offering document; or (c) performing
ministerial and clerical work involved in effecting any transaction.
SELLING SHAREHOLDERS
No shares are being offered for resale
by stockholders.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
______
You should read the following discussion
and analysis of our financial condition and results of our operations together with our consolidated financial statements and the
notes thereto appearing elsewhere in this Offering Circular. This discussion contains forward-looking statements reflecting our
current expectations, whose actual outcomes involve risks and uncertainties. Actual results and the timing of events may differ
materially from those stated in or implied by these forward-looking statements due to a number of factors, including those discussed
in the sections entitled “Risk Factors”, “Cautionary Statement regarding Forward-Looking Statements” and
elsewhere in this Offering Circular. Please see the notes to our Financial Statements for information about our Critical Accounting
Policies and Recently Issued Accounting Pronouncements.
Basis of Presentation
We have seven wholly-owned subsidiaries.
Hardrock Promotions LLC which owns Hardrock MMA in Kentucky, Colosseum Combat LLC which owns Colosseum Combat MMA in Indiana, Blue
Grass MMA LLC which is a marketing company, United Combat League MMA LLC, Pinnacle Combat LLC, Strike Hard Productions, LLC, and
B2 Productions LLC.
The consolidated financial statements,
which include the accounts of the Company and its six wholly owned subsidiaries, are prepared in conformity with generally accepted
accounting principles in the United States of America (“U.S. GAAP”). All significant intercompany balances and
transactions have been eliminated.
Forward-Looking Statements
Some of the statements under “Management's
Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Quarterly Report on Form
10-Q constitute forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans
and strategies, anticipated events or trends and similar matters that are not historical facts. In some cases, you can identify
forward-looking statements by terms such as “anticipate,” “believe,” “could,” “estimate,”
“expect,” “intend,” “may,” “plan,” “potential,” “should,”
and “would” or the negatives of these terms or other comparable terminology.
You should not place undue reliance on
forward-looking statements. The cautionary statements set forth in this Quarterly Report on Form 10-Q identify important factors,
which you should consider in evaluating our forward-looking statements. These factors include, among other things:
|
·
|
The speculative nature of the business we intend to develop;
|
|
·
|
Our reliance on suppliers and customers;
|
|
·
|
Our dependence upon external sources for the financing of our operations, particularly given that there are concerns about our ability to continue as a “going concern;”
|
|
·
|
Our ability to effectively execute our business plan;
|
|
·
|
Our ability to manage our expansion, growth and operating expenses;
|
|
·
|
Our ability to finance our businesses;
|
|
·
|
Our ability to promote our businesses;
|
|
·
|
Our ability to compete and succeed in highly competitive and evolving businesses;
|
|
·
|
Our ability to respond and adapt to changes in technology and customer behavior; and
|
|
·
|
Our ability to protect our intellectual property and to develop, maintain and enhance strong brands.
|
Although the forward-looking statements
in this Quarterly Report on Form 10-Q are based on our beliefs, assumptions and expectations, taking into account all information
currently available to us, we cannot guarantee future transactions, results, performance, achievements or outcomes. No assurance
can be made to any investor by anyone that the expectations reflected in our forward-looking statements will be attained, or that
deviations from them will not be material and adverse. We undertake no obligation, other than as maybe be required by law, to update
this Quarterly Report on Form 10-Q or otherwise make public statements updating our forward-looking statements.
Critical Accounting Policies
Basis of Accounting
The financial information furnished herein
reflects all adjustments, consisting of normal recurring items that, in the opinion of management, are necessary for a fair presentation
of the Company’s financial position, results of operations and cash flows for the interim periods. The results of operations
for the three and six months ended September 30, 2019 are not necessarily indicative of the results to be expected for the year
ending March 31, 2020.
Use of Estimates
Management uses estimates and assumptions
in preparing financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure
of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from these estimates
and assumptions.
Cash and Cash Equivalents
We consider all highly liquid investments
with a maturity of three months or less when purchased to be cash equivalents. We maintain deposits primarily in four financial
institutions, which may at times exceed amounts covered by insurance provided by the U.S. Federal Deposit Insurance Corporation
(“FDIC”). We have not experienced any losses related to amounts in excess of FDIC limits.
Fair Value of Financial Instruments
The Company’s financial instruments
consist primarily of accounts payable and accrued liabilities. The carrying amounts of such financial instruments approximate their
respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments.
Property and Equipment
Property and equipment are carried at cost.
Depreciation is provided on the straight-line method over the assets’ estimated service lives. Expenditures for maintenance
and repairs are charged to expense in the period in which they are incurred, and betterments are capitalized. The cost of assets
sold or abandoned, and the related accumulated depreciation are eliminated from the accounts and any gains or losses are reflected
in the accompanying consolidated statement of operations of the respective period. The estimated useful lives range from three
to seven years.
Goodwill
Goodwill represents the cost in excess
of the fair value of net assets acquired in business combinations. We test goodwill for impairment on an annual basis and when
events or changes in circumstances indicate that the carrying amount may not be recoverable. Goodwill is deemed to be impaired
if the carrying amount of goodwill exceeds its estimated fair value.
Revenue Recognition
Revenue is recognized when a customer obtains
control of promised goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty
of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration
that we expect to receive in exchange for those goods. We apply the following five-step model in order to determine this amount:
(i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations,
including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint
on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue
when (or as) we satisfy each performance obligation.
We only apply the five-step model to contracts
when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers
to the customer. Once a contract is determined to be within the scope of Financial Accounting Standards Board (“FASB”)
Accounting Standards Codification (“ASC”) 606 at contract inception, we review the contract to determine which
performance obligations we must deliver and which of these performance obligations are distinct. We recognize as revenues the amount
of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied
or as it is satisfied. Generally, our performance obligations are transferred to customers at a point in time, typically upon delivery.
Income Taxes
We follow Section 740-10-30 of the FASB
ASC, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that
have been included in the consolidated financial statements or tax returns. Under this method, deferred tax assets and liabilities
are based on the differences between the consolidated financial statement and tax bases of assets and liabilities using enacted
tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a
valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred
tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which
those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change
in tax rates is recognized in the consolidated Statements of Operations in the period that includes the enactment date. Through
September 30, 2019, we have an accumulated deficit. Due to uncertainty of realization for these losses, a full valuation allowance
is expected. Accordingly, no provision has been made for federal income taxes in the accompanying consolidated financial statements.
Stock-Based Compensation
We record stock-based compensation in accordance
with the provisions of FASB ASC Topic 718, “Accounting for Stock Compensation,” which establishes accounting standards
for transactions in which an entity exchanges its equity instruments for goods or services. In accordance with guidance provided
under ASC.
Topic 718, we recognize an expense for
the fair value of its stock awards at the time of grant and the fair value of its outstanding stock options as they vest, whether
held by employees or others. As of September 30, 2019, there were no options outstanding.
Recently Adopted Accounting Pronouncements
On June 20, 2018, the FASB issued ASU 2018-07, Compensation—Stock
Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018-07 is intended to reduce
cost and complexity and to improve financial reporting for share-based payments to nonemployees (for example, service providers,
external legal counsel, suppliers, etc.). Under the new standard, companies will no longer be required to value non-employee awards
differently from employee awards. Meaning that companies will value all equity classified awards at their grant-date under ASC
718 and forgo revaluing the award after this date. The Company adopted ASU 2018-07 on April 1, 2019. The adoption of this standard
did not have a material impact on the financial statements.
We have implemented all new accounting
pronouncements that are in effect. These pronouncements did not have any material impact on the consolidated financial statements
unless otherwise disclosed, and we do not believe that there are any other new accounting pronouncements that have been issued
that might have a material impact on its financial position or results of operations.
Organization and Nature of Business
In February 2017, the Board of Directors
of B2Digital, Incorporated, a Delaware corporation (“B2Digital” or the “Company”) approved
a complete restructuring, new management team and strategic direction for the Company. Capitalizing on its history in television,
video and technology, we are now forging ahead and becoming a full-service live event sports company.
Our Chairman and CEO is now Greg P. Bell.
Mr. Bell has over 30 years of global experience developing more than 20 companies in the sports, television, entertainment, digital
distribution and banking transaction industries. Capitalizing on the combination of his expertise, relationships and experience
as well as his involvement with more than 40,000 live events over his career for major sports leagues and entertainment venues,
we are in the process of developing and acquiring companies to become a premier vertically integrated live event sports company.
Our first strategy is to build an integrated
live event minor league for the mixed martial arts (“MMA”) marketplace, which is a billion-dollar industry.
We are creating and developing minor league champions that will move on to the MMA major leagues from the B2 Fighting Series (“B2FS”).
This will be accomplished by sponsoring operating live events, acquiring existing MMA promotions and then inviting those champions
to the B2FS Regional and National Championship Series. We own all media and merchandising rights and digital distribution networks
for the B2FS. This concept was developed and test marketed for two years by Mr. Bell’s B2 Management Group, LLC.
2017 marked the kickoff of the B2FS by
sponsoring and acquiring MMA regional promotion companies for the development of the B2FS. Our second strategy is to add additional
sports, leagues, tournaments and special events to our live event business model. This will enable us to capitalize on our core
technologies and business models that will be key to broadening the revenue base of our live event core business. We will also
be developing and expanding the B2Digital live event systems and technologies. These include systems for event management, digital
ticketing sales, digital video distribution, digital marketing, Pay-Per View (“PPV”), fighter management, merchandise
sales, brand management and financial control systems.
Historically, we had been a provider of
in-room, on-demand video entertainment and satellite services to the domestic lodging industry. In the past, we had provided video
services to over 50,000 hotel rooms in the lodging industry. PPV lost a great deal of market share due to the increased internet
use by hotel guests. With this loss, our Board of Directors agreed to dissolve Hotel Movie Network on March 11, 2010.
Business of the Company
The Company has seven wholly-owned subsidiaries.
Hardrock Promotions LLC which owns Hardrock MMA in Kentucky, Colosseum Combat LLC which owns Colosseum Combat MMA in Indiana, Blue
Grass MMA LLC which is a marketing company, United Combat League MMA LLC, Pinnacle Combat LLC, Strike Hard Productions, LLC, and
B2 Productions LLC.
Results of Operations
The following information represents our
results of operations for three months ended September 30, 2019 compared to September 30, 2018.
Three Months Ended September
30, 2019 Compared to September 30, 2018
|
|
For the three months ended September 30, 2019
(unaudited)
|
|
|
For the three months ended September 30, 2018
(unaudited)
|
|
|
Change
|
|
|
% Change
|
|
Live event revenue
|
|
$
|
96,275
|
|
|
$
|
78,992
|
|
|
$
|
17,283
|
|
|
|
21.88%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Live event expenses
|
|
|
73,588
|
|
|
|
60,948
|
|
|
|
12,640
|
|
|
|
20.74%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Live event income- net
|
|
|
22,687
|
|
|
|
18,044
|
|
|
|
4,643
|
|
|
|
25.73%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative corporate expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock compensation expense
|
|
|
233,600
|
|
|
|
–
|
|
|
|
233,600
|
|
|
|
100.00%
|
|
General & administrative expenses
|
|
|
115,697
|
|
|
|
32,593
|
|
|
|
83,104
|
|
|
|
254.97%
|
|
Depreciation expense
|
|
|
6,741
|
|
|
|
1,815
|
|
|
|
4,926
|
|
|
|
271.40%
|
|
Total general and administrative corporate expenses
|
|
|
356,038
|
|
|
|
34,408
|
|
|
|
321,630
|
|
|
|
934.75%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations
|
|
|
(333,351
|
)
|
|
|
(16,364
|
)
|
|
|
(316,987
|
)
|
|
|
1937.09%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on forgiveness of loan receivable
|
|
|
(27,000
|
)
|
|
|
–
|
|
|
|
(27,000
|
)
|
|
|
100.00%
|
|
Loss on modification of debt
|
|
|
(50,756
|
)
|
|
|
–
|
|
|
|
(50,756
|
)
|
|
|
100.00%
|
|
Interest expense
|
|
|
(2,308
|
)
|
|
|
(750
|
)
|
|
|
(1,558
|
)
|
|
|
207.73%
|
|
Total other income (expense)
|
|
|
(80,064
|
)
|
|
|
(750
|
)
|
|
|
(79,314
|
)
|
|
|
10575.20%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(413,415
|
)
|
|
$
|
(17,114
|
)
|
|
$
|
(396,301
|
)
|
|
|
2315.65%
|
|
Revenue
We had revenues of $96,275 for the three
months ended September 30, 2019 versus revenues of $78,992 for the three months ended September 30, 2018. The increase of $17,283
is due to increased live events from new business acquisitions.
Live Event Expenses
We incurred live event expenses of $73,588
for the three months ended September 30, 2019 versus live event expenses of $60,948 for the three months ended September 30, 2018.
The increase of $12,640 is due to increased live events from new business acquisitions.
Live Event income (loss) - net
We had live event income of $22,687 for
the three months ended September 30, 2019 versus live event income of $18,044 for the three months ended September 30, 2018. The
increase of $4,643 is due to increased live events from new business acquisitions.
Operating Expenses
Stock Compensation Expenses
We recorded stock compensation expense
in the amount of $233,600 for the three months ended September 30, 2019 for common stock issued for services. We did not have any
stock compensation expense for the three months ended September 30, 2018.
General & Administrative Expenses
Other general and administrative expenses
include professional fees, all costs associated with marketing, press releases, public relations, rent, sponsorships and other
expenses. We incurred general and administrative expenses of $115,697 for the three months ended September 30, 2019 versus general
and administrative expenses of $24,819 for the three months ended September 30, 2018. The increase of $90,878 was primarily due
to increased operations associated with new business acquisitions.
Depreciation Expense
We incurred depreciation expense of $6,741
for the three months ended September 30, 2019 versus depreciation expense of $1,815 for the three months ended September 30, 2018.
The increase of $4,926 was due to the purchase of assets during the three months ended September 30, 2019 related to a business
acquisition.
Other Income (Expense)
Other Expense
Our other income and expenses include interest
expense, loss on forgiveness of notes receivable, and a loss on modification of debt. We incurred interest expense of $2,308 for
the three months ended September 30, 2019 versus interest expenses of $750 for the three months ended September 30, 2018. We recorded
a loss on forgiveness of notes receivable in the amount of $27,000 and a loss on the modification of debt in the amount of $50,756
for the three months ended September 30, 2019.
Net Losses
We incurred a net loss of $413,415 for
the three months ended September 30, 2019 versus a net loss of $17,114 for the three months ended September 30, 2018. The increase
of $396,301 was primarily due to increased operations from acquisitions and stock-based compensation expense.
Results of Operations
The following information represents our
results of operations for six months ended September 30, 2019 compared to September 30, 2018.
Six Months Ended September 30,
2019 Compared to September 30, 2018
|
|
For the six months ended September 30, 2019
|
|
|
For the six months ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
(unaudited)
|
|
|
Change
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Live event revenue
|
|
$
|
181,911
|
|
|
$
|
172,595
|
|
|
$
|
9,316
|
|
|
|
5.40%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Live event expenses
|
|
|
135,540
|
|
|
|
142,976
|
|
|
|
(7,436
|
)
|
|
|
(5.20%
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Live event income- net
|
|
|
46,371
|
|
|
|
29,619
|
|
|
|
16,752
|
|
|
|
56.56%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative corporate expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock compensation expense
|
|
|
688,000
|
|
|
|
–
|
|
|
|
688,000
|
|
|
|
100.00%
|
|
General & administrative expenses
|
|
|
171,810
|
|
|
|
74,825
|
|
|
|
96,985
|
|
|
|
129.62%
|
|
Depreciation expense
|
|
|
10,053
|
|
|
|
4,314
|
|
|
|
5,739
|
|
|
|
133.03%
|
|
Total general and administrative corporate expenses
|
|
|
869,863
|
|
|
|
79,139
|
|
|
|
790,724
|
|
|
|
999.16%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations
|
|
|
(823,492
|
)
|
|
|
(49,520
|
)
|
|
|
(773,972
|
)
|
|
|
1562.98%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on forgiveness of loan receivable
|
|
|
(27,000
|
)
|
|
|
–
|
|
|
|
(27,000
|
)
|
|
|
100.00%
|
|
Loss on modification of debt
|
|
|
(50,756
|
)
|
|
|
–
|
|
|
|
(50,756
|
)
|
|
|
100.00%
|
|
Interest expense
|
|
|
(3,679
|
)
|
|
|
(2,107
|
)
|
|
|
(1,572
|
)
|
|
|
74.61%
|
|
Total other income (expense)
|
|
|
(81,435
|
)
|
|
|
(2,107
|
)
|
|
|
(79,328
|
)
|
|
|
3764.97%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(904,927
|
)
|
|
$
|
(51,627
|
)
|
|
$
|
(853,300
|
)
|
|
|
1652.85%
|
|
Revenue
We had revenues of $181,911 for the six
months ended September 30, 2019 versus revenues of $172,595 for the six months ended September 30, 2018. The increase of $9,316
is due to increased live events from new business acquisitions.
Live Event Expenses
We incurred live event expenses of $135,540
for the six months ended September 30, 2019 versus live event expenses of $142,976 for the six months ended September 30, 2018.
The decrease of $7,436 is due to changes in cost of different cities of fight venues.
Live Event income (loss) - net
We had live event income of $46,371 for
the six months ended September 30, 2019 versus a live event income of $29,619 for the six months ended September 30, 2018. The
increase of $16,752 is due to increased live events from new business acquisitions.
Operating Expenses
Stock Compensation Expenses
We recorded stock compensation expense
in the amount of $688,000 for the six months ended September 30, 2019 for common stock issued for services. We did not have any
stock compensation expense for the six months ended September 30, 2018.
General & Administrative Expenses
Other general and administrative expenses
include professional fees, all costs associated with marketing, press releases, public relations, rent, sponsorships and other
expenses. We incurred general and administrative expenses of $171,810 for the six months ended September 30, 2019 versus general
and administrative expenses of $74,825 for the six months ended September 30, 2018. The increase of $96,985 was primarily due to
increased operations associated with new business acquisitions.
Depreciation Expense
We incurred depreciation expense of $10,053
for the six months ended September 30, 2019 versus depreciation expense of $4,314 for the six months ended September 30, 2018.
The increase of $5,739 was due to the purchase of assets during the six months ended September 30, 2019 related to a business acquisition.
Other Income (Expense)
Other Expense
Our other income and expenses include interest
expense, loss on forgiveness of notes receivable, and a loss on modification of debt. We incurred interest expense of $3,679 for
the six months ended September 30, 2019 versus interest expenses of $2,107 for the six months ended September 30, 2018. We recorded
a loss on forgiveness of notes receivable in the amount of $27,000 and a loss on the modification of debt in the amount of $50,756
for the six months ended September 30, 2019.
Net Losses
We incurred a net loss of $904,927 for
the six months ended September 30, 2019 versus a net loss of $51,627 for the six months ended September 30, 2018. The increase
of $853,800 was primarily due to increased operations from acquisitions and stock-based compensation expense.
Current Liquidity and Capital Resources
for the six months ended September 30, 2019 compared to the six months ended September 30, 2018
|
|
2019
|
|
|
2018
|
|
Summary of Cash Flows:
|
|
|
|
|
|
|
|
|
Net cash used by operating activities
|
|
$
|
(184,942
|
)
|
|
$
|
(52,034
|
)
|
Net cash used by investing activities
|
|
|
(206,230
|
)
|
|
|
(1,659
|
)
|
Net cash provided by financing activities
|
|
|
400,000
|
|
|
|
36,154
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
8,828
|
|
|
|
(17,539
|
)
|
Beginning cash and cash equivalents
|
|
|
27,579
|
|
|
|
25,874
|
|
Ending cash and cash equivalents
|
|
$
|
36,407
|
|
|
$
|
8,335
|
|
Operating Activities
Cash used in operations of $184,942 during
the six months ended September 30, 2019 was primarily a result of our $904,927 net loss reconciled with our net non-cash expenses
relating to stock compensation, depreciation expense, inventory, prepaid expenses, accounts payable, accrued liabilities and deferred
compensation. Cash used in operations of $52,034 during the six months ended September 30, 2018 was primarily a result of our $51,627
net loss reconciled with our net non-cash expenses relating to stock compensation, depreciation expense, inventory, prepaid expenses,
accounts payable, accrued liabilities and deferred compensation.
Investing Activities
Net cash used in investing activities for
the six months ended September 30, 2019 of $206,230 resulted from the from the business acquisitions, net of cash in the amount
of $31,985 and money loaned to a related party in the amount of $174,245. Net cash used in investing activities for the six months
ended September 30, 2018 of $1,659 resulted from the acquisition of fixed assets.
Financing Activities
Net cash provided by financing activities
was $400,000 for six months ended September 30, 2019, which consisted of $400,000 in proceeds from the issuance of common stock.
Net cash provided by financing activities was $36,154 for six months ended September 30, 2018, which consisted of $38,760 in proceeds
from the issuance of common stock, $14,195 in payments on notes payable and $11,589 in proceeds form notes payable.
Future Capital Requirements
Our current available cash and cash equivalents
are insufficient to satisfy our liquidity requirements. Our capital requirements for fiscal year 2020 will depend on numerous factors,
including management’s evaluation of the timing of projects to pursue. Subject to our ability to generate revenues and cash
flow from operations and our ability to raise additional capital (including through possible joint ventures and/or partnerships),
we expect to incur substantial expenditures to carry out our business plan, as well as costs associated with our capital raising
efforts and being a public company.
Our plans to finance our operations include
seeking equity and debt financing, alliances or other partnership agreements, or other business transactions, that would generate
sufficient resources to ensure continuation of our operations.
The sale of additional equity or debt securities
may result in additional dilution to our shareholders. If we raise additional funds through the issuance of debt securities or
preferred stock, these securities could have rights senior to those of our common stock and could contain covenants that would
restrict our operations. Any such required additional capital may not be available on reasonable terms, if at all. If we were unable
to obtain additional financing, we may be required to reduce the scope of, delay or eliminate some or all of our planned activities
and limit our operations which could have a material adverse effect on our business, financial condition and results of operations.
Inflation
The amounts presented in our consolidated
financial statements do not provide for the effect of inflation on our operations or financial position. The net operating losses
shown would be greater than reported if the effects of inflation were reflected either by charging operations with amounts that
represent replacement costs or by using other inflation adjustments.
Going concern
The Company's financial statements are
prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of
assets and liquidation of liabilities in the normal course of business. At September
30, 2019 and March 31, 2019, the Company had $36,407 and $27,579 in cash and $49,497 in working capital and $85,372 in negative
working capital, respectively. For the six months ended September 30, 2019 and 2018, the Company had a net loss of $904,927 and
$51,627, respectively. For the three months ended September 30, 2019 and 2018, the Company had a net loss of $413,415 and $17,114,
respectively. Continued losses may adversely affect the liquidity of the Company in the future. In view of the matters
described in the preceding paragraph, recoverability of a major portion of the recorded asset amounts shown in the accompanying
balance sheet is dependent upon continued operations of the Company, which in turn is dependent upon the Company's ability to raise
additional capital, obtain financing and to succeed in its future operations. The financial statements do not include any adjustments
relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might
be necessary should the Company be unable to continue as a going concern.
As a going concern, Management’s
plan moving forward is to improve operating results through the live event sports businesses. Management believes these will operate
with positive cash flows and facilitate acquisition of additional Sports related businesses. Management plans to finance the growth
of the company and cover operating shortfalls by securing convertible loans and selling common stock.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Quantitative and Qualitative Disclosures
about Market Risk
In the ordinary course of our business,
we are not exposed to market risk of the sort that may arise from changes in interest rates or foreign currency exchange rates,
or that may otherwise arise from transactions in derivatives.
The preparation of financial statements
in conformity with GAAP requires our management to make estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the
reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Our significant
estimates and assumptions include the fair value of our common stock, stock-based compensation, the recoverability and useful lives
of long-lived assets, and the valuation allowance relating to our deferred tax assets.
Contingencies
Certain conditions may exist as of the
date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or
more future events occur or fail to occur. Our management, in consultation with its legal counsel as appropriate, assesses such
contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related
to legal proceedings that are pending against us or unasserted claims that may result in such proceedings, we, in consultation
with legal counsel, evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits
of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates it is probable that
a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued
in our financial statements. If the assessment indicates a potentially material loss contingency is not probable, but is reasonably
possible, or is probable, but cannot be estimated, then the nature of the contingent liability, together with an estimate of the
range of possible loss, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not
disclosed unless they involve guarantees, in which case the guarantees would be disclosed.
BUSINESS
____
Summary
B2Digital, Inc. was incorporated as a Delaware
corporation on June 3, 2004. Historically, the Company had been a provider of in-room, on-demand video entertainment and satellite
services to the domestic lodging industry. In the past the Company had provided the video services to over 50,000 hotel rooms in
the lodging industry. Pay-Per View lost a great deal of market share due to the increased internet use by hotel guests. With this
loss the Company’s Board of Directors agreed to dissolve Hotel Movie Network on March 11, 2010.
In February 2017, the Company’s Board
of Directors approved a complete restructuring, new management team and strategic direction for the company. Capitalizing on its
history in television, video and technology, the Company is now forging ahead and becoming a full-service live event sports company.
Since the restructuring, the Company has
been led by a management team headed by the Company’s Chairman and CEO, Greg P. Bell. The management team has over 30 years
of global experience developing more than 20 companies in the Sports, Television, Entertainment, Digital Distribution and Banking
Transaction industries. As part of its growth strategy, B2Digital intends to continue to develop and acquire assets meeting its
business model with the goal of becoming a Premier Vertically Integrated LIVE Event Sports Company.
With extensive background in entertainment,
television, video and technology, the Company is now forging ahead and becoming a full-service Live Event Sports Company. The current
Chairman and CEO of the Company is Greg P. Bell. Capitalizing on the combination of his expertise, relationships and experience
as well as his involvement with more than 40,000 LIVE events over his career for major sports leagues and entertainment venues,
B2Digital is in the process of developing and acquiring companies to become a Premier Vertically Integrated LIVE Event Sports Company.
B2Digital's first strategy is to build an integrated LIVE Event Minor League for the MMA Mixed Martial Arts marketplace, which
is a billion-dollar industry.
B2Digital will be creating and developing
Minor League champions that will move on to the MMA Major Leagues from the B2FS, B2 Fighting Series. In 2017, B2Digital started
operating LIVE MMA Events by acquiring additional existing MMA Promotions. These acquisitions which facilitate the best Fighters
being invited annually to the yearly B2FS National Championship Live Event. B2Digital owns all media rights, merchandising rights,
digital distribution networks of the B2 Fighting Series. B2Digital is developing the Systems and Technologies for Event Management,
Digital Ticketing Sales, Digital Video Distribution, Digital Marketing, PPV, Fighter Management, Merchandise Sales, Brand Management
and Financial Control Systems.
The Company’s fiscal year runs from
April 1 – March 31 of each year.
The Company owns 100% of the following entities
Blue Grass MMA LLC
www.bluegrassmma.com
Online News and social Media Site for MMA
CEO: Gary Thomas
Colosseum Combat LLC
www.colosseumcombat.com
MMA Company that puts on LIVE MMA Fights
Indiana, Michigan
CEO: Mark Slater
Hardrock Promotions LLC
www.hrmma.com
MMA Company that puts on LIVE MMA Fights
Kentucky, Ohio, Tennessee, West Virginia
CEO: Vanessa Higdon
Pinnacle Combat LLC
www.pinnaclecombat.com
MMA Company that puts on LIVE MMA Fights
Iowa
CEO: Harry Maglaris
UCL MMA LLC
www.uclmma.com
MMA Company that puts on LIVE MMA Fights
Illinois, Indiana
CEO: Mike Davis
Strike Hard Productions, LLC
www.strikehardproductions.com
MMA Company that puts on LIVE MMA Fights
Alabama
CEO: Jamie Sullivan
B2 Productions LLC
Entity that supplies all the TV, PPV and media for B2 Fighting
Series LIVE Events
CEO: Greg P. Bell
Expansion by Acquisition
Our operational plan is to acquire existing
other operating fight groups that are properly licensed and operating in up to 10 additional states or to expand one of our existing
brands into those target states if we cannot find or identify an existing compatible fight group to the B2 business model in the
target states.
The target states are but not limited to:
Currently licensed and Planned Fights to Occur
|
1.
|
Kentucky
|
|
2.
|
Ohio
|
|
3.
|
Indiana
|
|
4.
|
Illinois
|
|
5.
|
Iowa
|
|
6.
|
West Virginia
|
|
7.
|
Tennessee
|
|
8.
|
Michigan
|
|
9.
|
Alabama
|
New target States to Expand into
|
1.
|
Mississippi
|
|
2.
|
Kansas
|
|
3.
|
Nebraska
|
|
4.
|
South Dakota
|
Fight group businesses of this type typically
do not have a large amount of hard dollar assets. They own a cage, a truck to transport the cage, materials that are used in the
LIVE EVENT shows such as pipe and drape and signage, and retail POS machines to sell merchandise and tickets at the event.
Seasonality
We do not expect material seasonality in
our business.
Facilities
The Company occupies offices at 4522 West
Village Drive Suite 215. Tampa, Florida 33624. The Company does not currently own or lease any properties or facilities. The Company
expects to lease new office space in the future to the extent consistent with its business model.
Intellectual Property
We have a policy of requiring key employees
and consultants to execute confidentiality agreements upon the commencement of an employment or consulting relationship with us.
Our employee agreements also require relevant employees to assign to us all rights to any inventions made or conceived during their
employment with us. In addition, we have a policy of requiring individuals and entities with which we discuss potential business
relationships to sign non-disclosure agreements. Our agreements with clients include confidentiality and non-disclosure provisions.
Legal Proceedings
We may from time to time be involved in
various claims and legal proceedings of a nature we believe are normal and incidental to our business. These matters may include
product liability, intellectual property, employment, personal injury cause by our employees, and other general claims. We are
not presently a party to any legal proceedings that, in the opinion of our management, are likely to have a material adverse effect
on our business. Regardless of outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion
of management resources and other factors.
Employees
As of December 13, 2019, we had one employee,
including officers and directors. We believe that we will be successful in attracting experienced and capable personnel. Our employee
has entered into agreements with us requiring him not to compete or disclose our proprietary information. Our employee is not represented
by any labor union. We believe that relations with our employee are excellent. Usually the number of total employees and number
of full-time employees will vary.
MANAGEMENT
______
The following table sets forth information
regarding our executive officers, directors and significant employees, including their ages as of March 31, 2019:
Name and Principal Position
|
|
Age
|
|
Term of Office
|
|
Approximate hours
per week for
part-time
employees
|
Greg P. Bell, Chief Executive Officer and Director
|
|
61
|
|
Since January 2017
|
|
45
|
Paul D. H. LaBarre, Executive Vice President
|
|
73
|
|
Since September 2005
|
|
3
|
Andrew Georgens, Director, Secretary
|
|
67
|
|
Since November 2017
|
|
2
|
Hugh Darryl Metz, Director
|
|
58
|
|
Since November 2017
|
|
2
|
Greg P. Bell, Chairman of the Board
Chief Executive Officer and Director
Mr. Bell is one of the early pioneers and
entrepreneurs in Entertainment and Digital Media and has been working in the field for over 30 years. He was involved in the early
creation of the technologies and algorithms that allowed analog media to be transformed into digital bits and compressed data streams
and created specific business enterprises that capitalized on the creation of digital transmissions at Scientific Atlanta, Compression
Labs, VCON International and Qwest. Mr. Bell was one of the initial Vice Presidents of Business Development at Qwest Communications
where he developed Qwest's Digital Media Company, Slingshot Networks. He then ran all operations of Slingshot, reporting to the
board of directors, which managed and operated three full time studios including the creation of the Broadcast Studio in Staples
Center, TV and News productions, LIVE events at the Staples Center, distribution of a national television show distributed by Warner
Brothers TV Distribution and online television productions and web distribution for the NFL, NBA, NHL, AFL, Boxing, Democratic
Convention and LIVE music events.
Upon leaving Slingshot in 2000, Mr. Bell
founded B3 Development Group, a firm specializing in developing emerging market media companies. Mr. Bell ‘s B3 Development
Group founded B2 Networks in 2001 which quickly became the defacto standard for Watching LIVE Pay per View Sporting events online.
B2's Proprietary Online System broadcast LIVE Professional and Collegiate sporting events online to a global audience broadcasting
over 1000 LIVE games per month. Mr. Bell developed and implemented a merger with B2 Networks and the America ONE Television Network
where he became CEO of the combined companies. Under Mr. Bell's direction the company now called ONE Media Corp launched the new
ONE World Sports TV Network, now operating under the brand Eleven Sports, in North America on Cable and Satellite, with a pure
digital end-to-end distribution system, along with continuing the company’s growth in the online distribution of Sports and
Entertainment. After leaving as CEO of ONE Media Corp, he continues to develop companies and specializes in developing and fast
tracking emerging entertainment, transaction technology and media companies, Mr. Bell continues to expand his holdings and currently
has business holdings in B3 Development Group which under contract with Caymanas Park Race Track, owned by the
country of Jamaica, developed Jamaica’s first all-digital state of the art Pari-Mutuel Live Sports Gaming System for mobile
devices and currently is operating under the brand CaymanasToGO for the Caribbean Consumers and Platinum Racing for USA, European
and global consumers. The B3 mobile device wagering system and technology allows consumers globally to watch and wager on Live
Horse Races and Sporting Events being held in the UK, USA, Canada and the Caribbean; B3 Gaming Services Group, a
premier transaction and customer service group that offers management services to the Gaming industry in the Caribbean, B3
Networks, a premier state of the art digital broadcasting company that developed the B3 Television Satellite Replacement
Technology which allows TV Networks to broadcast globally on the public internet instead of satellites in broadcast quality HD
& SD Television. B3 Networks has deployed and services the B3 technology to broadcast High Definition and SD TV signals globally
to cable headends, smart phones and Internet connected devices for the Jamaica Education Television Network, the Caymanas Race
Track and other mobile applications globally. In February 2017 he became the Chairman and CEO of B2 Digital, Inc., trading
at Symbol: BTDG on the OTC. B2 Digital will capitalize on Mr. Bell’s LIVE Event Experience and is in the process of building
a Minor League for the MMA, Mixed Martial Arts Major Leagues, in conjunction with acquiring Sports Related companies to develop
the business into a vertically integrated LIVE Event Sports Company.
Mr. Bell has worked at the top technology
development companies that developed the digital technologies, which are in use today at Scientific Atlanta, Compression Labs,
VCON and Qwest. He also has managed and been directly involved with over 55,000 LIVE events in his 30-year career. He has worked
with a diverse group of clients in the entertainment, sports and technology communities including the NFL, NBA, NHL, AHL, NLL,
ECHL, IFL, USHL, SPHL, NCAA, NAIA, MISL, AFL, AOL, FOX, UFC, NAAFS, Bellator, WEF, the Staples Center, the Orleans Arena, Oscar
De La Hoya, Barbra Streisand, and top entertainment venues, acts and actors. His clients and companies have capitalized on Mr.
Bell's knowledge of the world of Entertainment, LIVE Events, Sports, Digital Television and Digital Online Transaction and Distribution
Systems.
EDUCATION:
East Grand Rapids High School
Graduated 1975
Grand Valley State University
Graduated 1980
BBA Business Management
Emphasis in Computer Science, Economics
and Marketing
Hugh Darryl Metz,
Director
Mr. Metz has over 30 years’ experience
in Broadcasting, Television, Computer Graphics and LIVE Event Management. He was one of the first to operate computer graphics
television technology in the early 80s while developing Live Event graphics solutions for major television networks for LIVE professional
and college sports television broadcasts. He is certified in several Microsoft and Cisco product lines and served as IT systems
administrator for Blockbuster Entertainment and IBM on the Blockbuster business support systems of the Blockbuster franchisees
IT Network. He has worked on Sports productions for national TV networks operating and managing LIVE Television broadcasts for
over 1000 LIVE Sports Event.
In 2007 Mr. Metz began working with the
B2 Networks PPV Company as Mr. Bell’s head of LIVE Event Operations. His responsibilities included managing all aspects of
over 200 LIVE TV and Internet broadcast productions for the NCAA and Pro Sports Leagues in Football, Basketball, Hockey, MMA and
Special Events and then serving as Special Projects Director reporting to Mr. Bell the CEO of ONE World Sports, which acquired
B2 Networks.
In 2012 Mr. Metz became VP of Operations
for Mr. Bell’s B3 Enterprises Company, which owned the largest minority share of the NAAFS MMA group in OHIO. He was instrumental
in developing all the LIVE Event operations systems, financial controls, security and event management operations with the management
team who operated the B2 MMA Test Market Business model that produced over 20 LIVE MMA Events in 2 years.
Currently, he is the acting Broadcast IT
Engineer at Gray Television's station that serves southern Oklahoma and oversees the technical operations of 3 local CBS, MyTV,
Fox affiliate Television Networks.
EDUCATION:
Robstown High School
Robstown, Texas
Graduated 1979
Courses Attended:
2000 to 2001
Grayson County College
IT and Technology Training
IBM Technical Training
2000 to 2007
Internal Technical Certification in IT,
Infrastructure and Systems Engineering
Paul
D. H. LaBarre, Executive Vice President, Director
2006
to 2017, Member of the Board of Directors Good Hunting Communications, Inc.
2010
to 2017, CEO B2Digital INC. and Director
EDUCATION:
Attended Courses and studies:
Business Management, technology courses
offered by Scientific Atlanta, Blonder Tongue, Jerrold, C-Cor & Magnavox,
Lawyer’s Assistant-Litigation &
Trial Practice,
Automotive Training, Ford, General
Motors, Chrysler & VW, Attended Several Courses in Automotive Training, CAC, PC General studies.
Andrew
Georgens, Director
1970 - 1973 Payne Construction Company, Monsoon MATel Com /
CATV construction Lineman, foreman, supervisor, management.
1973 - 1980
|
Tiger Communications, Springfield MA Tel com / CATV construction / engineering
|
|
Owner, General Manager
|
|
|
1980 - 2005
|
Communications Systems Contractors, Springfield MA / Dalton MA
|
|
Tel com / CATV & related fields / construction / engineering
|
|
Owner / General Manager
|
|
|
2005 - present
|
Retired
|
|
|
EDUCATION:
Cathedral High School
Springfield MA
Graduated 1969
Springfield Technical Community College
Attended 1970. 1 yr.
Except as given herein, none of our officers
or directors in the last five years has been the subject of any conviction in a criminal proceeding or named as a defendant in
a pending criminal proceeding (excluding traffic violations and other minor offenses), the entry of an order, judgment, or decree,
not subsequently reversed, suspended or vacated, by a court of competent jurisdiction that permanently or temporarily enjoined,
barred, suspended or otherwise limited such person’s involvement in any type of business, securities, commodities, or banking
activities; a finding or judgment by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission,
the Commodity Futures Trading Commission, or a state securities regulator of a violation of federal or state securities or commodities
law, which finding or judgment has not been reversed, suspended, or vacated; or the entry of an order by a self-regulatory organization
that permanently or temporarily barred, suspended or otherwise limited such person’s involvement in any type of business
or securities activities.
On June 26, 2013, Paul D.H. LaBarre, the
Company’s Executive Vice President and a director, was convicted of improper use of a satellite signal in connection with
the previously disclosed action involving DirecTV. Mr. LaBarre was sentenced to five years’ probation in connection with
the conviction.
There are no family relationships among
and between our directors, officers, persons nominated or chosen by the Company to become directors or officers, or beneficial
owners of more than five percent (5%) of the any class of the Company’s equity securities.
EXECUTIVE COMPENSATION
______
The following table represents information
regarding the total compensation our officers and directors of the Company for the year ended March 31, 2019:
|
|
Cash
Compensation
|
|
Annual Bonus
Available
|
|
Other
Compensation*
|
|
Total
Compensation
|
Name and Principal Position
|
|
|
|
|
|
|
|
|
Greg P. Bell, CEO and Director
|
|
-0-
|
|
-0-
|
|
$3,000
|
|
-0-
|
Paul LaBarre, Executive Vice President and Director
|
|
-0-
|
|
-0-
|
|
-0-
|
|
-0-
|
Andrew Georgens, Director
|
|
-0-
|
|
-0-
|
|
-0-
|
|
-0-
|
Hugh Darryl Metz, Director
|
|
|
|
|
|
|
|
|
Total
|
|
-0-
|
|
-0-
|
|
-0-
|
|
-0-
|
*Stock awards
Board Service Agreements
Messrs. Metz and Georgens have entered
into Board Service Agreements with the Company (collectively, the “Board Service Agreements”). Pursuant to the
terms of the Board Service Agreements, Mr. Metz was awarded 3,000,000 shares and Mr. Georgens was awarded 1,000,000 shares of the
Company’s common stock, par value $0.00001 per share (the “Common Stock” and each such award, a “Director
Common Stock Award”), and will be paid annual cash compensation of $500 per year, in each case as compensation for services
performed as a director of the Company. Each Director Common Stock Award will vest over a two-year period from the Effective Date,
with 50% vesting on the first anniversary thereof and 50% vesting on the second anniversary thereof.
CEO Agreement
The Company has also entered into an agreement
with Mr. Bell as the Chairman of the Board and Chief Executive Officer & President (the “CEO Agreement”).
Pursuant to the terms of the CEO Agreement, the Company may not terminate Mr. Bell from his positions as Chief Executive Officer
and President of the Company, or remove him from the Board or change his position as Chairman thereof, without the approval of
80% of the voting capital stock of the Company, unless such termination and/or removal is due to death or legal incapacity.
As compensation for Mr. Bell’s services
pursuant to the terms of the CEO Agreement, the Company will issue B2 Management Group Group LLC, a limited liability company wholly
owned and controlled by Mr. Bell (“B2 Management Group”), a total of 30,000,000 shares of Common Stock (the
“CEO Stock Award”). The 30,000,000 shares of the CEO Stock Award will be issued to B2 Management Group within
ten days of the Effective Date (the “Issuance Date”).
As further compensation for Mr. Bell’s
services to the Company in connection with the Company’s acquisition activity, the Company has issued B2 Management Group,
LLC an additional 60,000,000 shares of Common Stock as compensation for the completion of the Company’s previously announced
acquisitions of Hard Rock MMA (30,000,000 Shares) and Colosseum Combat LLC (30,000,000) (collectively, the “Recent Acquisitions”).
Finally, pursuant to the terms of the CEO
Agreement, the Company will issue B2 Management Group, LLC an additional 30,000,000 shares of Common Stock within ten days of completion
of each future acquisition by the Company of any MMA fight organization, whether pursuant to an equity or asset purchase, up to
a total of five (5) acquisitions subsequent to the Recent Acquisitions (corresponding to a total aggregate amount of 150,000,000
shares that may be issued in connection with future acquisitions).
The CEO Agreement also includes a non-compete
covenant whereby Mr. Bell will not compete directly with the Company during the term of the CEO Agreement.
The foregoing summary is qualified in its
entirety to the terms of the CEO Agreement itself, a copy of which is an exhibit to this Offering Circular.
LaBarre Agreement
The Company has also entered into an Employment
and Board Service Agreement with Paul D.H. LaBarre, the Company’s Executive Vice President and a director (the “LaBarre
Agreement”). The term of the LaBarre Agreement is 36 months, which shall run from the Effective Date, and will renew
automatically for successive two-year periods unless either the Company or Mr. LaBarre provides notice of non-renewal no later
than six months prior to the expiration of the then-current term. Pursuant to the terms of the LaBarre Agreement, the Company may
not terminate Mr. LaBarre from his positions as Executive Vice President of the Company, or remove him from the Board, without
the approval of 80% of the voting capital stock of the Company, unless such termination and/or removal is due to death or legal
incapacity. Additionally, Mr. LaBarre may terminate the LaBarre Agreement at any time upon three months’ prior written notice
to the Company.
As payment for past compensation owed to
Mr. LaBarre from his employment agreement for his past services to the Company, the Company will issue Mr. LaBarre 50,000,000 shares
of Common Stock. As compensation for Mr. LaBarre’s continuing services to the Company as Executive Vice President, the Company
will issue Mr. LaBarre 4,000,000 shares of Common Stock per year for each year in which Mr. LaBarre remains employed in such capacity
and the LaBarre Agreement remains in effect (the “Annual Salary Issuance”). 50% of the Annual Salary Issuance
will vest every six months. In the event of a merger or consolidation of the Company in which the Company is not the surviving
entity, or a proposed dissolution or liquidation of the Company or a sale of substantially all of its assets, any unvested portion
of the Annual Salary Issuance remaining in the then-current term of the LaBarre Agreement will vest immediately.
As payment to Mr. LaBarre for his services
as a director, the Company will pay Mr. LaBarre annual cash compensation of $500 per year.
The foregoing summary is qualified in its
entirety to the terms of the LaBarre Agreement itself, a copy of which is an exhibit to this Offering Circular.
CERTAIN RELATIONSHIPS AND RELATED PARTY
TRANSACTIONS
Except as given in this Offering Circular,
during the last two full fiscal years and the current fiscal year or any currently proposed transaction, there is no transaction
involving the Company, in which the amount involved exceeds the lesser of $120,000 or one percent of the average of the Company’s
total assets at year-end for its last three fiscal years.
Disclosure of Conflicts of Interest
There are no conflicts of interest between
the Company and any of its officers or directors
Indemnification Agreements
We have entered into indemnification agreements
with each of our directors, executive officers and other key employees. The indemnification agreements and our amended and restated
By-Laws will require us to indemnify our directors to the fullest extent permitted by Delaware law.
Insofar as indemnification for liabilities
arising under the Securities Act of 1933, as amended (the Securities Act), may be permitted to directors, executive officers or
persons controlling us, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed
in the Securities Act and is therefore unenforceable.
Review, Approval or Ratification of Transactions with
Related Parties
We have adopted a related-party transactions
policy under which our executive officers, directors, nominees for election as a director, beneficial owners of more than 5% of
any class of our Common Stock, and any members of the immediate family of any of the foregoing persons are not permitted to enter
into a related-party transaction with us without the consent of our audit committee. If the related party is, or is associated
with, a member of our audit committee, the transaction must be reviewed and approved by another independent body of our Board of
Directors, such as our governance committee. Any request for us to enter into a transaction with a related party in which the amount
involved exceeds $120,000 and such party would have a direct or indirect interest must first be presented to our audit committee
for review, consideration and approval. If advance approval of a related-party transaction was not feasible or was not obtained,
the related-party transaction must be submitted to the audit committee as soon as reasonably practicable, at which time the audit
committee shall consider whether to ratify and continue, amend and ratify, or terminate or rescind such related-party transaction.
All of the transactions described above were reviewed and considered by, and were entered into with the approval of, or ratification
by, our Board of Directors.
During the last two full fiscal years and
the current fiscal year or any currently proposed transaction, there are transactions involving the issuer, in which the amount
involved exceeds the lesser of $120,000 or one percent of the average of the issuer’s total assets at year-end for its last
three fiscal years, except compensation awarded to executives.
Disclosure of Conflicts of Interest
There are no conflicts of interest between
the Company and any of its officers or directors.
PRINCIPAL STOCKHOLDERS
______
The following table sets forth certain
information known to us regarding beneficial ownership of our capital stock as of December 13, 2019 for (i) all executive officers
and directors as a group and (ii) each person, or group of affiliated persons, known by us to be the beneficial owner of more than
ten percent (10%) of our capital stock. The percentage of beneficial ownership in the table below is based on 581,003,354 shares
of Common Stock and 2,000,000 shares of Series A Preferred Stock issued and outstanding as December 13, 2019.
Name and Address
|
Shares of
Series A
Preferred Stock Owned
|
|
Shares of
Common Stock
Owned
|
|
Total Votes from Preferred and Common Stock Outstanding on December 13, 2019
|
|
Percentage of Total Votes
|
|
Percentage of Total Votes Assuming All Shares Offered are Sold(1)
|
|
Paul D. H. LaBarre
1112 W. Farmdale Ave. Mesa, AZ 85210-3427 (1)
|
|
850,000
|
|
|
64,191,494
|
|
|
268,191,494
|
|
|
26.47%
|
|
|
16.63%
|
|
B2 Management Group, LLC
4522 West Village Drive, Suite 215, Tampa, Florida 33624(2)
|
|
850,000
|
|
|
199,500,000
|
|
|
403,500,000
|
|
|
39.83%
|
|
|
25.02%
|
|
Andrew Georgens
|
|
100,000
|
|
|
1,022,880
|
|
|
25,022,280
|
|
|
2.47%
|
|
|
*
|
|
Hugh Darryl Metz
|
|
0
|
|
|
3,000,000
|
|
|
3,000,000
|
|
|
*
|
|
|
*
|
|
Total Officers and Directors
|
|
1,800,000
|
|
|
267,714,374
|
|
|
699,713,774
|
|
|
69.07%
|
|
|
43.38%
|
|
*Less than 1%
|
(1)
|
Total Common Shares outstanding will be 1,181,003,354 if all of the Offering is sold.
|
|
(2)
|
B2 Management Group, LLC is owned and controlled by Mr. Greg P. Bell, the Company’s Chairman and Chief Executive Officer.
|
In addition to the Common Stock, the Company
has authorized a total of 50,000,000 shares of preferred stock, currently designated as Series A Convertible Preferred Stock and
Series B Convertible Preferred Stock (“Series B Preferred Stock”). 2,000,000 shares of Series A Preferred Stock
are currently issued and outstanding. The Series A Preferred Stock votes with the Common Stock on all matters to be voted on by
the common stock on an as-converted basis. On such matters, each holder of Series A Preferred Stock is entitled to 240 votes for
each share of Series A Preferred Stock held by such shareholder.
Capitalization
Class of Stock
|
|
Par Value
|
|
Authorized
|
|
Outstanding as of
December 13, 2019
|
Preferred Stock, Series A
|
|
0.00001
|
|
|
2,000,000
|
|
|
2,000,000
|
|
Preferred Stock, Series B
|
|
0.00001
|
|
|
40,000,000
|
|
|
0
|
|
Common Stock
|
|
0.00001
|
|
|
5,000,000,000
|
|
|
581,003,354
|
|
DESCRIPTION OF SECURITIES
______
The Common Stock
We are authorized to issue 5,000,000,000
shares of Common Stock, $0.00001 par value. The holders of Common Stock are entitled to equal dividends and distributions, with
respect to the Common Stock when, as, and if declared by the Board of Directors from funds legally available for such dividends.
No holder of Common Stock has any preemptive right to subscribe for any of our stock nor are any shares subject to redemption.
Upon our liquidation, dissolution or winding up, and after payment of creditors and any amounts payable to senior securities, the
assets will be divided pro rata on a share-for-share basis among the holders of the shares of Common Stock. All shares of Common
Stock now outstanding upon completion of this Offering and conversion of any Preferred Stock, are, and will be, fully paid, validly
issued and non-assessable.
Holders of our Common Stock do not have
cumulative voting rights, so that the holders of more than 50% of the shares voting for the election of directors will be able
to elect 100% of the directors if they choose to do so, and in that event, the holders of the remaining shares will not be able
to elect any members to the Board of Directors.
The Company has never paid any dividends
to shareholders of our Common Stock. The declaration in the future of any cash or stock dividends will depend upon our capital
requirements and financial position, general economic conditions, and other pertinent factors. We presently intend not to pay any
cash or stock dividends in the foreseeable future. Management intends to reinvest earnings, if any, in the development and expansion
of our business. No dividend may be paid on the Common Stock until all Preferred Stock dividends are paid in full.
Preferred Stock
We are authorized to issued 5,000,000,000
shares of preferred stock of the Company, par value $0.00001 per share.
Series A Convertible Preferred Stock
There are 2,000,000 shares of Series A
Convertible Preferred Stock designated.
The Series A Preferred is senior to the
Common Stock and any other series or class of the Company's Preferred Stock.
Liquidation Rights. In the event
of any liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary, the holders of the Series A Preferred
then outstanding shall be entitled to be paid out of the assets of the Company available for distribution to its shareholders,
before any payment or declaration, and setting apart for payment of any amount shall be made in respect of any outstanding capital
stock of the Company, an amount equal to Two Dollars and Forty Cents ($2.40) per share, plus the Redemption provision (as defined
below). Then all of the assets of the Company available to be distributed shall be distributed ratably to the holders of the Series
A Preferred and then to the holders of other outstanding shares of capital stock of the Company. If upon any liquidation, dissolution,
or winding up of the Company, whether voluntary or involuntary, the assets to be distributed to the holders of the Series A Preferred
shall be insufficient to permit the payment to the holders thereof the full preferential amount as provided herein, then such available
assets shall be distributed ratably to the holders of the Series A Preferred.
None of the following events shall be treated
as or deemed to be a liquidation hereunder: (1) A merger, consolidation or reorganization of the Company; (2) A sale or other transfer
of all or substantially all of the Company's assets; (3) A sale of 50% or more of the Company's capital stock then issued and outstanding;
(4) A purchase or redemption by the Company of stock of any class; or (5) Payment of a dividend or distribution from funds legally
available therefor.
Voting Rights. On all matters to
be voted on by the holders of Common Stock, the Holders of the Series A Preferred shall be entitled to 240 votes for each share
of Series A Preferred held of record. On all such matters, the holders of Common Stock and the Holders of Series A Preferred shall
vote together as a single class. If the Company effects a stock split which either increases or decreases the number of shares
of Common Stock outstanding and entitled to vote, the voting rights of the Series A Preferred shall not be subject to adjustment
unless specifically authorized Conversion. The Series A Preferred shall have the following conversion rights (the "Conversion
Rights"):
Holder's Optional Right to Convert.
Each share of Series A Preferred shall be convertible, at the option of the holder(s), on the Conversion Basis (as set forth below)
in effect at the time of conversion. Such right to convert shall commence as of the Issue Date and shall continue thereafter for
a period of years, such period ending on the fifth anniversary' of the Issue Date. In the event that the holder(s) of the Series
A Preferred elect to convert such shares into Common Stock, the holder(s) shall have 60 days from the date of such notice in which
they tender their shares of Series A Preferred to the Company.
Conversion Basis. Each share of
Series A Preferred shall be convertible into 240 shares of the Company's Common Stock.
Mechanics of Conversion. Before
any bolder of Series A Preferred shall be entitled to convert the same into shares of Common Stock, such holder shall (i) give
written notice to the Company, at the office of the Company or of its transfer agent for the Common Stock or the Preferred Stock,
that he elects to convert the same and shall state therein the number of shares of Series A Preferred being converted; and (ii)
surrender the certificate or certificates therefor, duly endorsed. Thereupon the Company shall promptly issue and deliver to such
holder of Series A Preferred a certificate or certificates for the number of shares of Common Stock to which such holder shall
be entitled. The conversion shall be deemed to have been made and the resulting shares of Common Stock shall be deemed to have
been issued immediately prior to the close of business on the date of such notice and tender of the shares of Series A Preferred.
Adjustments to the Conversion Basis.
(1) Stock Splits and Combinations. Subject to the Protective Provisions (as defined below), if at any time after the Company first
issues the Series A Preferred and while any of the shares of Series A Preferred remain outstanding, if the Company shall effect
a subdivision or combination of the Common Stock, the Conversion Basis then in effect immediately before that subdivision or combination
shall be proportionately adjusted. Any adjustment shall become effective at the close of business on the date the subdivision or
combination becomes effective. (2) Reclassification. Exchange or Substitution. At any time after the Company first issues the Series
A Preferred and while any of the shares of Series A Preferred remain outstanding, if the Common Stock issuable upon the conversion
of the Series A Preferred shall be changed into the same or a different number of shares of any class or classes of stock, whether
by capital reorganization, reclassification, or otherwise (other than a subdivision or combination of shares or stock dividend
provided for above, or a reorganization, merger, consolidation, or sale of assets), then and in each such event the holder of each
share of Series A Preferred shall have the right thereafter to convert such shares into the kind and amount of shares of stock
and other securities and property receivable upon such reorganization, reclassification, or other change, by holders of the number
of shares of Common Stock into which such shares of Series A Preferred might have been converted immediately prior to such reorganization,
reclassification, or change, all subject to further adjustments as provided herein. (3) Reorganization. Mergers. Consolidations
or Sales of Assets. At any time after the Company first issues the Series A Preferred and while any of such shares remain outstanding,
if there shall be a capital reorganization of the Common Stock (other than a subdivision, combination, reclassification, or exchange
of shares), or a merger or consolidation of the Company with or into another Company, or the sale of all or substantially all of
the Company's assets to any other person, then as a part of such reorganization, merger, consolidation, or sale, provision shall
be made so that the holders of the Series A Preferred thereafter shall be entitled to receive upon conversion of the Series A Preferred,
the number of shares of stock or other securities or property of the Company, or of the successor Company resulting from such merger
or consolidation or sale, to which a bolder of Series A Preferred deliverable upon conversion would have been entitled on such
capital reorganization, merger, consolidation, or sale.
Notices of Record Date. In the event
of any reclassification or recapitalization of the capital stock of the Company, any merger or consolidation of the Company, or
any transfer of all or substantially all of the assets of the Company to any other Company, entity, or person, or any voluntary
or involuntary dissolution, liquidating, or winding up of the Company, the Company shall mail to each holder of Series A Preferred
at least 30 days prior to the record date specified therein, a notice specifying the date on which any such reorganization, reclassification,
transfer, consolidation, merger, dissolution, liquidation or winding up is expected to become effective, and the time, if any is
to be fixed, as to when the holders of record of Common Stock (or other securities) shall be entitled to exchange their shares
of Common Stock (or other securities) for securities or other property deliverable upon such reorganization, reclassification,
transfer, consolidation, merger, dissolution, liquidation, or winding up.
Fractional Shares. No fractional
shares of Common Stock shall be issued upon conversion of the Series A Preferred. In lieu of any fractional shares to which the
holder would otherwise be entitled, the Company shall pay cash equal to the product of such fraction multiplied by the fair market
value of one share of the Company's Common Stock on the date of conversion, as determined in good faith by the Company's directors.
Reservation of Stock Issuable Upon Conversion.
At such time as the Company increases its authorized capital resulting in a sufficient number of shares of Common Stock becoming
available for the conversion of the Series A Preferred the Company shall reserve and keep available out of its authorized but unissued
shares of Common Stock, solely for the purpose of effecting the conversion of the shares of the Series A Preferred, a number of
its shares of Common Stock as shall from time to time be sufficient to effectuate the conversion of all outstanding shares of Series
A Preferred.
Protective Provisions. Notwithstanding
anything contained herein to the contrary, so long any of the Series A Preferred shall be outstanding, the Company shall not without
first obtaining the approval (by vote or written consent, as provided by law) of the holders of at least two-thirds of the total
number of shares of Series A Preferred outstanding: (a) Alter or change the rights, preferences or privileges of the Series A Preferred
by way of reverse stock lit, reclassification, merger consolidation or otherwise, so as to adversely affect in any manner the voting
rights including number of votes presently allowed or the conversion basis by which the shares of Series A Preferred are presently
converted into shares of Common Stock; (b) Increase the authorized number of Series A Preferred; (c) Create any new class of shares
having preferences over or being on a parity with the Series A Preferred as to dividends or assets, unless the purpose of creation
of such class is, and the proceeds to be derived from the sale and issuance thereof are to be used for, the retirement of all Series
A Preferred then outstanding; (d) Repurchase any of the Company's Common Stock (e) Merge or consolidate with any other Company,
except into or with a wholly-owned subsidiary of the Company with the requisite shareholder approval; (f) Sell, convey or otherwise
dispose of, or create or incur any mortgage, lien, charge or encumbrance on or security interest in or pledge of, or sell and leaseback,
all or substantially all of the property or business of the Company; or (g) Incur, assume or guarantee any indebtedness (other
than such as may be represented by the obligation to pay rent under leases) maturing more than 18 months after the date on which
it is incurred, assumed or guaranteed by the Company, except purchase money obligations, obligations assumed as part of the price
of property purchased, or the extension, renewal or refunding of any thereof.
Redemption.
Subject to the applicable provisions of Delaware law, the Company, at the option of its directors, may at any time or from time
to time redeem the whole or any part of the outstanding Series A Preferred. Upon redemption the Company shall pay for each share
redeemed $2.40 per share, payable in cash, plus a premium to compensate the original purchaser(s) for the investment risk and cost
of capital equal to the greater of (a) $2.40 per share, or (b) an amount per shares equal to 50% of the market capitalization of
the Company on the date of notice of such redemption divided by 2,000,000 (the "Redemption Premium"), the redemption
amount and the Redemption Premium hereinafter being referred to as the "Redemption Price." Such redemption shall be on
an all-or-nothing basis.
At least 30 days previous notice by mail,
postage prepaid, shall be given to the holders of record of the Series A Preferred to be redeemed, such notice to be addressed
to each such shareholder at the address of such holder appearing on the books of the Company or given to such holder to the Company
for the purpose of notice, or if no such address appears or is given, at the place where the principal office of the Company is
located. Such notice shall state the date fixed for redemption and the redemption price and shall call upon the holder to surrender
to the Company on said date at the place designated in the notice such holder's certificate or certificates representing the shares
to be redeemed. On or after the date fixed for redemption and stated in such notice, each holder of Series A Preferred called for
redemption shall surrender the certificate evidencing such shares to the Company at the place designated in such notice and shall
thereupon be entitled to receive payment of the redemption price. If less than all the shares represented by any such surrendered
certificate are redeemed, a new certificate shall be issued representing the unredeemed shares. If such notice of redemption shall
have been duly given, and if on the date fixed for redemption funds necessary for the redemption shall be available therefore,
notwithstanding that the certificates evidencing any Series A Preferred called for redemption shall not have been surrendered,
the dividends, if any, with respect to the shares so called for redemption shall forthwith after such date cease and desist and
determine, except only the right of the holders to receive the redemption price without interest upon surrender of their certificates
therefore.
If, on or prior to any date fixed for redemption
or Series A Preferred, the Company deposits, with any bank or trust company as trust fund, the number of shares of Common Stock
of a sum sufficient to redeem, on the date fixed for redemption thereof, the shares called for redemption, with irrevocable instructions
and authority to the bank or trust company to give the notice of redemption thereof (or to complete the giving of such notice if
theretofore commenced and to pay, or deliver, on or after the date fixed for redemption or prior thereto, the redemption price
of the shares to their respective holders upon the surrender of their share certificates, then from and after the date of the deposit
(although prior to the date fixed for redemption), the shares so called shall be redeemed and any dividends on those shares shall
cease to accrue after the date fixed for redemption. The deposit shall constitute full payment of the shares to their holders and
from and after the date of the deposit the shares shall no longer be outstanding and the holders thereof shall cease to be shareholders
with respect to such shares, and shall have no rights with respect thereto except the right to receive from the bank or trust company
payment of the redemption price of the shares without interest, upon the surrender of their certificates therefore. Any interest
accrued on any funds so deposited shall be the property of, ari4 paid to, the Company. If the holders of Series A Preferred so
called for redemption shall. not, at the end of six years from the date fixed for redemption thereof, have claimed any funds so
deposited, such bank or trust company shall thereupon pay over to the Company such unclaimed funds, and such bank or trust company
shall thereafter be relieved of all responsibility in respect thereof to such holders and such holders shall look only to the Company
for payment of the redemption price.
Reissuance. No share or shares
of Series A Preferred acquired by the Company by reason of conversion or otherwise shall be reissued as Series A Preferred, and
all such shares thereafter shall be returned to the status of undesignated and unissued shares of Preferred Stock of the Company.
Status of Reacquired Stock. Shares
of Series A Preferred which have been issued and reacquired in any manner shall, upon compliance with any applicable provisions
of Delaware law, have the status of authorized and unissued shares of Preferred Stock may be redesignated and reissued in any series
or class.
Series B Convertible Preferred Stock
There are 40,000,000 shares of Series B
Convertible Preferred Stock designated.
Voting. Liquidation. Dividends, and
Redemption. Each outstanding share of Series B Convertible Preferred Stock shall have no voting rights on matters submitted
to the common stockholders of the Corporation. The shares of Series B Convertible Preferred Stock shall (i) not have a Liquidation
preference; (ii) not accrue, earn, or participate in any dividends; and (iii) not be subject to redemption by the Corporation.
Conversion. 12 months following
the original issuance date, but not before, each outstanding share of Series B Convertible Preferred Stock may be converted, at
the option of the owner, into five shares of the Company’s common stock.
DIVIDEND POLICY
______
We have never declared or paid cash dividends
on our capital stock. We currently intend to retain any future earnings for use in the operation of our business and do not intend
to declare or pay any cash dividends in the foreseeable future. Any further determination to pay dividends on our capital stock
will be at the discretion of our Board of Directors, subject to applicable laws, and will depend on our financial condition, results
of operations, capital requirements, general business conditions, and other factors that our Board of Directors considers relevant.
SECURITIES OFFERED
______
Current Offering
B2Digital, Incorporated (“B2Digital,
Incorporated,” “We,” or the “Company”) is offering up to 600,000,000 total shares
of Common Stock, $0.00001 par value (the “Common Stock” or collectively the “Securities”).
The Common Stock
We are authorized to issue 5,000,000,000
shares of Common Stock, $0.00001 par value. The holders of Common Stock are entitled to equal dividends and distributions, with
respect to the Common Stock when, as, and if declared by the Board of Directors from funds legally available for such dividends.
No holder of Common Stock has any preemptive right to subscribe for any of our stock nor are any shares subject to redemption.
Upon our liquidation, dissolution or winding up, and after payment of creditors and senior securities, the assets will be divided
pro rata on a share-for-share basis among the holders of the shares of Common Stock. All shares of Common Stock now outstanding
upon completion of this Offering are, and will be, fully paid, validly issued and non-assessable.
Holders of our Common Stock do not have
cumulative voting rights, so that the holders of more than 50% of the shares voting for the election of directors will be able
to elect 100% of the directors if they choose to do so. In that event, the holders of the remaining shares will not be able to
elect any members to the Board of Directors.
Transfer Agent
Our transfer agent is Signature Stock Transfer,
Inc., 14673 Midway Road, Suite #220, Addison, Texas 75001, (972) 612-4120, www.signaturestocktransfer.com. The transfer
agent is registered under the Exchange Act and operates under the regulatory authority of the SEC and FINRA.
SHARES ELIGIBLE FOR FUTURE SALE
_____
Prior to this Offering, there has been
a limited market for our Common Stock. Future sales of substantial amounts of our Common Stock, or securities or instruments convertible
into our Common Stock, in the public market, or the perception that such sales may occur, could adversely affect the market price
of our Common Stock prevailing from time to time. Furthermore, because there will be limits on the number of shares available for
resale shortly after this Offering due to contractual and legal restrictions described below, there may be resales of substantial
amounts of our Common Stock in the public market after those restrictions lapse. This could adversely affect the market price of
our Common Stock prevailing at that time.
LEGAL MATTERS
_____
Certain legal matters with respect to the shares of common stock
offered hereby will be reviewed by Business Legal Advisors, LLC of Utah.
EXPERTS
______
The consolidated financial statements of
the Company appearing elsewhere in this Offering Circular have been prepared by management and have not been reviewed by an independent
accountant.
WHERE YOU CAN FIND MORE INFORMATION
______
We have filed with the SEC a Regulation
A Offering Statement on Form 1-A under the Securities Act with respect to the shares of common stock offered hereby. This Offering
Circular, which constitutes a part of the Offering Statement, does not contain all of the information set forth in the Offering
Statement or the exhibits and schedules filed therewith. For further information about us and the common stock offered hereby,
we refer you to the Offering Statement and the exhibits and schedules filed therewith. Statements contained in this Offering Circular
regarding the contents of any contract or other document that is filed as an exhibit to the Offering Statement are not necessarily
complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document
filed as an exhibit to the Offering Statement. Upon the completion of this Offering, we will be required to file periodic reports,
proxy statements, and other information with the SEC pursuant to the Securities Exchange Act of 1934. You may read and copy this
information at the SEC's Public Reference Room, 100 F Street, N.E., Room 1580, Washington, D.C. 20549. You may obtain information
on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet website
that contains reports, proxy statements and other information about issuers, including us, that file electronically with the SEC.
The address of this site is www.sec.gov.
B2Digital, Inc.
INDEX TO FINANCIAL STATEMENTS
FINANCIAL STATEMENTS
Table of Contents
For
the Six Months Ended September 30, 2018
|
|
|
|
Consolidated Balance Sheets as of September 30, 2019 (unaudited) and March 31, 2019
|
F-2
|
Consolidated Statements of Operations (unaudited) for the six months ended September 30, 2019 and September 30, 2018
|
F-3
|
Consolidated Statements of Operations (Unaudited) for the three months ended September 30, 2019 and September 30, 2018
|
F-4
|
Consolidated Statements of Stockholders’ Equity (Unaudited) for the six months ended September 30, 2019 and September 30, 2018
|
F-5
|
Consolidated Statements of Cash Flows (Unaudited) for the six months ended September 30, 2019 and September 30, 2018
|
F-7
|
Notes to the consolidated financial statements
|
F-8
|
B2Digital, Incorporated
Consolidated Balance Sheets
|
|
As of
September 30, 2019
(Unaudited)
|
|
|
As of
March 31, 2019
|
|
Assets
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
36,407
|
|
|
$
|
27,579
|
|
Deposits and prepaid expenses
|
|
|
25,588
|
|
|
|
6,260
|
|
Note receivable- related party
|
|
|
164,661
|
|
|
|
65,416
|
|
Total current assets
|
|
|
226,656
|
|
|
|
99,255
|
|
|
|
|
|
|
|
|
|
|
Fixed assets
|
|
|
|
|
|
|
|
|
Cages
|
|
|
122,025
|
|
|
|
46,025
|
|
Trucks trailers and vehicles
|
|
|
12,500
|
|
|
|
9,500
|
|
Event assets
|
|
|
59,462
|
|
|
|
8,987
|
|
Electronics hardware and software
|
|
|
10,470
|
|
|
|
6,960
|
|
Less: accumulated depreciation
|
|
|
(26,459
|
)
|
|
|
(16,407
|
)
|
Total fixed assets
|
|
|
177,998
|
|
|
|
55,065
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
314,272
|
|
|
|
193,045
|
|
Total Assets
|
|
$
|
718,926
|
|
|
$
|
347,365
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities & Stockholders' Equity
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
Accounts payable & accrued liabilities
|
|
$
|
129,909
|
|
|
$
|
109,627
|
|
Deferred revenue
|
|
|
3,250
|
|
|
|
–
|
|
Note payable- current maturity
|
|
|
14,000
|
|
|
|
75,000
|
|
Payable due for business acquisitions
|
|
|
15,000
|
|
|
|
–
|
|
Note payable- in default
|
|
|
15,000
|
|
|
|
–
|
|
Total current liabilities
|
|
|
177,159
|
|
|
|
184,627
|
|
|
|
|
|
|
|
|
|
|
Note payable- long-term
|
|
|
60,000
|
|
|
|
14,000
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
|
237,159
|
|
|
|
198,627
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies (Note 7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' Equity
|
|
|
|
|
|
|
|
|
Preferred stock, 50,000,000 shares authorized, 40,000,000 shares of Series B; 2,000,000 shares of Series A, convertible into 240 shares of common stock issued and outstanding at September 30, 2019 and March 31, 2019, respectively; 8,000,000 shares are undesignated
|
|
|
20
|
|
|
|
20
|
|
Common stock, $0.00001 par value; 5,000,000,000 shares authorized; 563,120,110 and 377,620,110 shares issued and outstanding at September 30, 2019 and March 31, 2019, respectively
|
|
|
5,631
|
|
|
|
3,776
|
|
Additional paid in capital
|
|
|
3,860,674
|
|
|
|
2,624,573
|
|
Accumulated deficit
|
|
|
(3,384,558
|
)
|
|
|
(2,479,631
|
)
|
Total Stockholders' Equity
|
|
|
481,767
|
|
|
|
148,738
|
|
Total Liabilities and Stockholders' Equity
|
|
$
|
718,926
|
|
|
$
|
347,365
|
|
See accompanying notes to the
unaudited consolidated financial statements.
B2Digital, Incorporated
Consolidated Statements of Operations
|
|
For the six months ended
September 30, 2019
|
|
|
For the six months ended
September 30, 2018
|
|
|
|
(unaudited)
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Live event revenue
|
|
$
|
181,911
|
|
|
$
|
172,595
|
|
|
|
|
|
|
|
|
|
|
Live event expenses
|
|
|
135,540
|
|
|
|
142,976
|
|
|
|
|
|
|
|
|
|
|
Live event income- net
|
|
|
46,371
|
|
|
|
29,619
|
|
|
|
|
|
|
|
|
|
|
General and administrative corporate expenses
|
|
|
|
|
|
|
|
|
Stock compensation expense
|
|
|
688,000
|
|
|
|
–
|
|
General & administrative expenses
|
|
|
171,810
|
|
|
|
74,825
|
|
Depreciation expense
|
|
|
10,053
|
|
|
|
4,314
|
|
Total general and administrative corporate expenses
|
|
|
869,863
|
|
|
|
79,139
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations
|
|
|
(823,492
|
)
|
|
|
(49,520
|
)
|
|
|
|
|
|
|
|
|
|
Other income (expense)
|
|
|
|
|
|
|
|
|
Loss on forgiveness of note receivable
|
|
|
(27,000
|
)
|
|
|
–
|
|
Loss on modification of debt
|
|
|
(50,756
|
)
|
|
|
–
|
|
Interest expense
|
|
|
(3,679
|
)
|
|
|
(2,107
|
)
|
Total other income (expense)
|
|
|
(81,435
|
)
|
|
|
(2,107
|
)
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(904,927
|
)
|
|
$
|
(51,627
|
)
|
|
|
|
|
|
|
|
|
|
Basic diluted earnings per share on net loss
|
|
$
|
(0
|
)
|
|
$
|
(0
|
)
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding
|
|
|
471,101,799
|
|
|
|
328,684,393
|
|
See accompanying notes to the unaudited
consolidated financial statements.
B2Digital, Incorporated
Consolidated Statements of Operations
|
|
For the three months ended September 30, 2019
|
|
|
For the three
months ended
September 30, 2018
|
|
|
|
(unaudited)
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Live event revenue
|
|
$
|
96,275
|
|
|
$
|
78,992
|
|
|
|
|
|
|
|
|
|
|
Live event expenses
|
|
|
73,588
|
|
|
|
60,948
|
|
|
|
|
|
|
|
|
|
|
Live event income- net
|
|
|
22,687
|
|
|
|
18,044
|
|
|
|
|
|
|
|
|
|
|
General and administrative corporate expenses
|
|
|
|
|
|
|
|
|
Stock compensation expense
|
|
|
233,600
|
|
|
|
–
|
|
General & administrative expenses
|
|
|
115,697
|
|
|
|
32,593
|
|
Depreciation expense
|
|
|
6,741
|
|
|
|
1,815
|
|
Total general and administrative corporate expenses
|
|
|
356,038
|
|
|
|
34,408
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations
|
|
|
(333,351
|
)
|
|
|
(16,364
|
)
|
|
|
|
|
|
|
|
|
|
Other income (expense)
|
|
|
|
|
|
|
|
|
Loss on forgiveness of loan receivable
|
|
|
(27,000
|
)
|
|
|
–
|
|
Loss on modification of debt
|
|
|
(50,756
|
)
|
|
|
–
|
|
Interest expense
|
|
|
(2,308
|
)
|
|
|
(750
|
)
|
Total other income (expense)
|
|
|
(80,064
|
)
|
|
|
(750
|
)
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(413,415
|
)
|
|
$
|
(17,114
|
)
|
|
|
|
|
|
|
|
|
|
Basic diluted earnings per share on net loss
|
|
$
|
(0
|
)
|
|
$
|
(0
|
)
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding
|
|
|
528,339,793
|
|
|
|
340,921,298
|
|
See accompanying notes to the unaudited
consolidated financial statements.
B2Digital, Incorporated
Consolidated Statement of Changes in Stockholders' Equity (Unaudited)
Six Months Ended September 30, 2018
|
|
Preferred
Stock
|
|
|
Common
Stock
|
|
|
Additional
Paid
in
|
|
|
Accumulated
|
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Deficit
|
|
|
Total
|
|
Balance March
31, 2018
|
|
|
2,000,000
|
|
|
$
|
20
|
|
|
|
263,075,044
|
|
|
$
|
2,631
|
|
|
$
|
2,381,068
|
|
|
$
|
(2,345,820
|
)
|
|
$
|
37,899
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sale of common stock
|
|
|
–
|
|
|
|
–
|
|
|
|
30,000,000
|
|
|
|
300
|
|
|
|
–
|
|
|
|
–
|
|
|
|
300
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock for
services
|
|
|
–
|
|
|
|
–
|
|
|
|
35,000,000
|
|
|
|
350
|
|
|
|
–
|
|
|
|
–
|
|
|
|
350
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock for
conversion of debt
|
|
|
–
|
|
|
|
–
|
|
|
|
3,478,400
|
|
|
|
35
|
|
|
|
37,985
|
|
|
|
–
|
|
|
|
38,020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(34,513
|
)
|
|
|
(34,513
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance June 30, 2018
|
|
|
2,000,000
|
|
|
|
20
|
|
|
|
331,553,444
|
|
|
|
3,316
|
|
|
|
2,419,053
|
|
|
|
(2,380,333
|
)
|
|
|
42,056
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(17,114
|
)
|
|
|
(17,114
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance September 30, 2018
|
|
|
2,000,000
|
|
|
$
|
20
|
|
|
|
331,553,444
|
|
|
$
|
3,316
|
|
|
$
|
2,419,053
|
|
|
$
|
(2,397,447
|
)
|
|
$
|
24,942
|
|
See accompanying notes to the unaudited
consolidated financial statements.
B2Digital, Incorporated
Consolidated Statement of Changes in Stockholders' Equity (Unaudited)
Six Months Ended September 30, 2019
|
|
Preferred
Stock
|
|
|
Common
Stock
|
|
|
Additional
Paid in
|
|
|
Accumulated
|
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Deficit
|
|
|
Total
|
|
Balance March 31, 2019
|
|
|
2,000,000
|
|
|
$
|
20
|
|
|
|
377,620,110
|
|
|
$
|
3,776
|
|
|
$
|
2,624,573
|
|
|
$
|
(2,479,631
|
)
|
|
$
|
148,738
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sale of common stock
|
|
|
–
|
|
|
|
–
|
|
|
|
13,281,250
|
|
|
|
133
|
|
|
|
84,867
|
|
|
|
–
|
|
|
|
85,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock for
services
|
|
|
–
|
|
|
|
–
|
|
|
|
71,000,000
|
|
|
|
710
|
|
|
|
453,690
|
|
|
|
–
|
|
|
|
454,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock as
part of business combination
|
|
|
–
|
|
|
|
–
|
|
|
|
14,000,000
|
|
|
|
140
|
|
|
|
89,460
|
|
|
|
–
|
|
|
|
89,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(491,512
|
)
|
|
|
(491,512
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance June 30, 2019
|
|
|
2,000,000
|
|
|
|
20
|
|
|
|
475,901,360
|
|
|
|
4,759
|
|
|
|
3,252,590
|
|
|
|
(2,971,143
|
)
|
|
|
286,226
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sale of common stock
|
|
|
–
|
|
|
|
–
|
|
|
|
49,218,750
|
|
|
|
492
|
|
|
|
314,508
|
|
|
|
–
|
|
|
|
315,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock for
services
|
|
|
–
|
|
|
|
–
|
|
|
|
36,500,000
|
|
|
|
365
|
|
|
|
233,235
|
|
|
|
–
|
|
|
|
233,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock as
part of business combination
|
|
|
–
|
|
|
|
–
|
|
|
|
9,000,000
|
|
|
|
90
|
|
|
|
57,510
|
|
|
|
–
|
|
|
|
57,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cancellation of outstanding
shares in exchange cancellation of notes receivable - related party
|
|
|
–
|
|
|
|
–
|
|
|
|
(7,500,000
|
)
|
|
|
(75
|
)
|
|
|
(47,925
|
)
|
|
|
–
|
|
|
|
(48,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from modification of
debt
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
50,756
|
|
|
|
–
|
|
|
|
50,756
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(413,415
|
)
|
|
|
(413,415
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
September 30, 2019
|
|
|
2,000,000
|
|
|
$
|
20
|
|
|
|
563,120,110
|
|
|
$
|
5,631
|
|
|
$
|
3,860,674
|
|
|
$
|
(3,384,558
|
)
|
|
$
|
481,767
|
|
See accompanying notes to the
unaudited consolidated financial statements.
B2Digital, Incorporated
Consolidated Statements of Cash Flows
|
|
For the six months ended
September 30, 2019
|
|
|
For the six months ended
September 30, 2018
|
|
|
|
(unaudited)
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Cash Flows from Operating Activities
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(904,927
|
)
|
|
$
|
(51,627
|
)
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile net loss to net cash used by operating activities:
|
|
|
|
|
|
|
|
|
Stock compensation
|
|
|
688,000
|
|
|
|
–
|
|
Depreciation
|
|
|
10,053
|
|
|
|
4,314
|
|
Loss on forgiveness of loan receivable
|
|
|
27,000
|
|
|
|
–
|
|
Loss on modification of debt
|
|
|
50,756
|
|
|
|
–
|
|
Changes in operating assets & liabilities
|
|
|
|
|
|
|
|
|
Deposits and prepaid expenses
|
|
|
(19,329
|
)
|
|
|
–
|
|
Inventory
|
|
|
–
|
|
|
|
(885
|
)
|
Accounts payable & accrued Liabilities
|
|
|
(36,495
|
)
|
|
|
(3,836
|
)
|
Net cash used by operating activities
|
|
|
(184,942
|
)
|
|
|
(52,034
|
)
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities
|
|
|
|
|
|
|
|
|
Note receivable- related party
|
|
|
(174,245
|
)
|
|
|
–
|
|
Purchase of fixed assets
|
|
|
–
|
|
|
|
(1,659
|
)
|
Business acquisitions, net of cash acquired
|
|
|
(31,985
|
)
|
|
|
–
|
|
Net cash used by investing activities
|
|
|
(206,230
|
)
|
|
|
(1,659
|
)
|
|
|
|
|
|
|
|
|
|
Cash Flows from Financing Activities
|
|
|
|
|
|
|
|
|
Proceeds from notes payables
|
|
|
–
|
|
|
|
11,589
|
|
Payment to note payable
|
|
|
–
|
|
|
|
(14,195
|
)
|
Issuance of common stock
|
|
|
400,000
|
|
|
|
38,760
|
|
Net cash provided by financing activities
|
|
|
400,000
|
|
|
|
36,154
|
|
|
|
|
|
|
|
|
|
|
Increase (decrease) in cash
|
|
|
8,828
|
|
|
|
(17,539
|
)
|
|
|
|
|
|
|
|
|
|
Cash at beginning of period
|
|
|
27,579
|
|
|
|
25,874
|
|
|
|
|
|
|
|
|
|
|
Cash at end of period
|
|
$
|
36,407
|
|
|
$
|
8,335
|
|
|
|
|
|
|
|
|
|
|
Supplemental Cash Flow Information
|
|
|
|
|
|
|
|
|
Cash paid for interest
|
|
$
|
–
|
|
|
$
|
250
|
|
Cash paid for income taxes
|
|
$
|
–
|
|
|
$
|
–
|
|
|
|
|
|
|
|
|
|
|
Non-cash investing and financing activities:
|
|
|
|
|
|
|
|
|
23,000,000 shares of common stock issued for business combination
|
|
$
|
147,200
|
|
|
$
|
–
|
|
7,500,000 shares returned in exchange for forgiveness of loan receivable
|
|
$
|
480,000
|
|
|
$
|
–
|
|
Payables for acquisitions
|
|
$
|
15,000
|
|
|
$
|
–
|
|
See accompanying notes to the
unaudited consolidated financial statements.
B2DIGITAL, INCORPORATED
NOTES
TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - ORGANIZATION AND NATURE
OF BUSINESS
In February 2017, the Board
of Directors of B2Digital, Incorporated ("B2Digital" or the "Company") approved a complete restructuring,
new management team and strategic direction for the Company. Capitalizing on its history in television, video and technology, the
Company is now forging ahead and becoming a full service live event sports company.
B2Digital's first strategy
is to build an integrated live event Minor League for the Mixed Martial Arts (MMA) marketplace. B2Digital will be creating and
developing Minor League champions that will move on to the MMA Major Leagues from the B2 Fighting Series (B2FS). This will be accomplished
by sponsoring operating live events, acquiring existing MMA promotions and then inviting those champions to the B2FS Regional and
National Championship Series. B2Digital will own all media and merchandising rights and digital distribution networks for the
B2FS.
2017 marked the kickoff of the
B2FS by sponsoring and acquiring MMA regional promotion companies for the development of the B2FS. The second strategy is that
the Company plans to add additional sports, leagues, tournaments and special events to its live event business model. This will
enable B2Digital to capitalize on their core technologies and business models that will be key to broadening the revenue base
of the Company's live event core business. B2Digital will also be developing and expanding the B2Digital live event systems and
technologies. These include systems for event management, digital ticketing sales, digital video distribution, digital marketing,
Pay-Per View (PPV), fighter management, merchandise sales, brand management and financial control systems.
Basis of Presentation and
Consolidation
The Company has six wholly-owned
subsidiaries. Hardrock Promotions LLC which owns Hardrock MMA in Kentucky, Colosseum Combat LLC which owns Colosseum Combat MMA
in Indiana and Blue Grass MMA LLC which is a marketing company, United Combat League MMA LLC, Pinnacle Combat LLC, and Strike Hard
Productions, LLC.
The consolidated financial statements,
which include the accounts of the Company and its six wholly-owned subsidiaries, are prepared in conformity with generally accepted
accounting principles in the United States of America (U.S. GAAP). All significant intercompany balances and transactions have
been eliminated. The consolidated financial statements, which include the accounts of the Company and its six wholly-owned subsidiaries,
and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).
The Financial Statements have been prepared using the accrual basis of accounting in accordance with accounting principles generally
accepted in the United States of America (“GAAP”) and presented in US dollars. The fiscal year end is March 31.
NOTE 2 - ACCOUNTING POLICIES
The significant accounting policies
of the Company are as follows:
Basis of Accounting
The accounts are maintained
and the consolidated financial statements have been prepared using the accrual basis of accounting in accordance with GAAP. The
financial information furnished herein reflects all adjustments, consisting of normal recurring items that, in the opinion of
management, are necessary for a fair presentation of the Company’s financial position, results of operations and cash flows
for the interim periods. The results of operations for the three and six months ended September 30, 2019 are not necessarily indicative
of the results to be expected for the year ending March 31, 2020.
Use of Estimates
Management uses estimates and
assumptions in preparing financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities,
the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from these
estimates and assumptions.
Cash and Cash Equivalents
The Company considers all highly
liquid investments with a maturity of three months or less when purchased to be cash equivalents. The Company maintains deposits
primarily in four financial institutions, which may at times exceed amounts covered by insurance provided by the U.S. Federal Deposit
Insurance Corporation ("FDIC"). The Company has not experienced any losses related to amounts in excess of FDIC limits.
Fair Value of Financial Instruments
The Company’s financial
instruments consist primarily of accounts payable and accrued liabilities. The carrying amounts of such financial instruments approximate
their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments.
Property and Equipment
Property and equipment are
carried at cost. Depreciation is provided on the straight-line method over the assets’ estimated service lives. Expenditures
for maintenance and repairs are charged to expense in the period in which they are incurred, and betterments are capitalized. The
cost of assets sold or abandoned and the related accumulated depreciation are eliminated from the accounts and any gains or losses
are reflected in the accompanying consolidated statement of operations of the respective period. The estimated useful lives range
from 3 to 7 years.
Goodwill
Goodwill represents the cost
in excess of the fair value of net assets acquired in business combinations. The Company tests goodwill for impairment on an annual
basis and when events or changes in circumstances indicate that the carrying amount may not be recoverable. Goodwill is deemed
to be impaired if the carrying amount of goodwill exceeds its estimated fair value.
Revenue Recognition
Revenue is recognized when
a customer obtains control of promised goods or services. In addition, the standard requires disclosure of the nature, amount,
timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded
reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step
model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether
the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement
of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance
obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.
The Company only applies the
five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for
the goods or services it transfers to the customer. Once a contract is determined to be within the scope of Financial Accounting
Standards Board (“ FASB”) Accounting Standards Codification (“ASC”) 606 at contract inception, the Company
reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations
are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance
obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company's performance obligations
are transferred to customers at a point in time, typically upon delivery.
Income Taxes
The Company follows Section
740-10-30 of the FASB ASC, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences
of events that have been included in the consolidated financial statements or tax returns. Under this method, deferred tax assets
and liabilities are based on the differences between the consolidated financial statement and tax bases of assets and liabilities
using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are
reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized.
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years
in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities
of a change in tax rates is recognized in the consolidated Statements of Operations in the period that includes the enactment date.
Through September 30, 2019, the Company has an accumulated deficit. Due to uncertainty of realization for these losses, a full
valuation allowance is expected. Accordingly, no provision has been made for federal income taxes in the accompanying consolidated
financial statements.
Stock based compensation
The Company records stock-based compensation
in accordance with the provisions of FASB ASC Topic 718, “Accounting for Stock Compensation,” which establishes accounting
standards for transactions in which an entity exchanges its equity instruments for goods or services. In accordance with guidance
provided under ASC.
Topic 718, the Company recognizes an expense for the fair value of its stock awards at the time of grant and
the fair value of its outstanding stock options as they vest, whether held by employees or others. As of September 30, 2019, there
were no options outstanding.
Recently Adopted Accounting
Pronouncements
On June 20, 2018, the FASB
issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment
Accounting. ASU 2018-07 is intended to reduce cost and complexity and to improve financial reporting for share-based payments
to nonemployees (for example, service providers, external legal counsel, suppliers, etc.). Under the new standard, companies will
no longer be required to value non-employee awards differently from employee awards. Meaning that companies will value all equity
classified awards at their grant-date under ASC 718 and forgo revaluing the award after this date. The Company adopted ASU 2018-07
on April 1, 2019. The adoption of this standard did not have a material impact on the financial statements.
The Company has implemented all new accounting
pronouncements that are in effect. These pronouncements did not have any material impact on the consolidated financial statements
unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have
been issued that might have a material impact on its financial position or results of operations.
NOTE 3 - RELATED PARTY
B2 Management, LLC (“B2
Management”) has as its sole member the Chief Executive Officer and Chairman of B2Digital. During the six months ended September
30, 2019, B2 Management received $174,245 in advances. On September 27, 2019, the Company and B2 Management Group LLC (“B2MG”)
entered into an agreement whereby B2MG agreed to return 7,500,000 shares of the Company’s common stock in exchange for the
cancellation of $75,000 owed by B2MG to the Company. As of September 30, 2019 and March 31, 2019, the Company has an uncollateralized,
non-interest-bearing note receivable of $164,661 and $65,416, respectively, from B2 Management that is due upon demand.
NOTE 4 – BUSINESS ACQUISITIONS
United Combat League, UCL MMA LLC
Effective May 1, 2019, the Company
completed its previously announced acquisition of 100% of the equity interest in United Combat League, LLC (“UCL”),
in an effort to execute its strategy of developing and building a Premier Development League for the Mixed Martial Arts (“MMA”)
marketplace. The purchase price was $20,000 in cash and 6,000,000 shares of Restricted Common Stock issuable to Michael Davis,
the seller of the equity interest in the acquisition. The Company is required to pay the cash consideration in three payments as
follows: (i) $10,000 on or before 10 calendar days after the execution date of the agreement, (ii) $5,000 on or before 45 calendar
days after the execution date of the agreement, and (iii) $5,000 on or before 90 calendar days after the execution date of the
agreement.
Consideration
|
|
|
|
|
|
|
|
Cash
|
|
$
|
20,000
|
|
6,000,000 shares of common stock issued to the sellers
|
|
|
38,400
|
|
Total consideration
|
|
$
|
58,400
|
|
|
|
|
|
|
Fair value of net identifiable assets (liabilities) acquired
|
|
|
|
|
|
|
|
|
|
Goodwill resulting from transaction
|
|
$
|
58,400
|
|
Goodwill is calculated as the excess of
the purchase price paid over the net assets recognized. The goodwill recorded as part of the UCL acquisition primarily reflects
the value of adding UCL to B2Digital in order to expand its footprint in the MMA marketplace and execute its strategy of developing and
building a Premier Development League MMA marketplace. Goodwill is not amortizable nor deductible for tax purposes. The Company
analyzed the acquisition under applicable guidance and determined that the acquisition should be accounted for as a business combination.
The initial accounting for this transaction is not completed and the fair value of the acquired identifiable intangible assets
are provisional pending receipt of the final valuations for those assets.
The Company is required to present a pro
forma balance sheet assuming the transaction was consummated on the date of the latest balance sheet included in the filing and
a pro forma statement of operations assuming the transaction was consummated at the beginning of the fiscal year presented and
carried forward through any interim period presented. However, since the initial accounting has not been finalized for the transaction
the Company believes presenting pro forma information is impracticable and plans to present it once the accounting is finalized.
Pinnacle Combat LLC- Acquisition
On July 15, 2019, to be effective June
29, 2019, the Company completed an acquisition of 100% of the equity interest in Pinnacle Combat LLC of Iowa (“Pinnacle”),
in an effort to execute its strategy of developing and building a Premier Development League for the MMA marketplace. The purchase
price was $20,000 in cash and 8,000,000 shares of Restricted Common Stock, 5,000,000 to be issued to Harry Maglaris and 3,000,000
to be issued to Ken Rigdon, collectively the sellers of the equity interest in the acquisition. The Company is required to pay
the cash consideration in three payments as follows: (i) $10,000 on or before 10 calendar days after the execution date of the
agreement, (ii) $5,000 on or before 45 calendar days after the execution date of the agreement, and (iii) $5,000 on or before
90 calendar days after the execution date of the agreement.
Consideration
|
|
|
|
Cash
|
|
$
|
20,000
|
|
8,000,000 shares of common stock issued to the sellers
|
|
|
51,200
|
|
Total consideration
|
|
$
|
71,200
|
|
|
|
|
|
|
Fair values of identifiable net assets:
|
|
|
|
|
Cages
|
|
$
|
54,000
|
|
Event asset (barriers)
|
|
|
6,000
|
|
Truck/trailer
|
|
|
3,000
|
|
Venture lighting system
|
|
|
25,000
|
|
Total identifiable net assets
|
|
|
88,000
|
|
|
|
|
|
|
Fair value of liabilities assumed:
|
|
|
|
|
Credit card liability
|
|
|
25,028
|
|
|
|
|
|
|
Fair value of net identifiable assets (liabilities) acquired
|
|
|
62,972
|
|
|
|
|
|
|
Goodwill resulting from transaction
|
|
$
|
8,228
|
|
Goodwill is calculated as the excess of
the purchase price paid over the net assets recognized. The goodwill recorded as part of the Pinnacle acquisition primarily reflects
the value of adding Pinnacle to B2Digital in order to expand its footprint in the MMA marketplace and execute its strategy of developing
and building a Premier Development League MMA marketplace. Goodwill is not amortizable nor deductible for tax purposes. The Company
analyzed the acquisition under applicable guidance and determined that the acquisition should be accounted for as a business combination.
The initial accounting for this transaction is not completed and the fair value of the acquired identifiable intangible assets
are provisional pending receipt of the final valuations for those assets.
The Company is required to present a pro
forma balance sheet assuming the transaction was consummated on the date of the latest balance sheet included in the filing and
a pro forma statement of operations assuming the transaction was consummated at the beginning of the fiscal year presented and
carried forward through any interim period presented. However, since the initial accounting has not been finalized for the transaction
the Company believes presenting pro forma information is impracticable and plans to present it once the accounting is finalized.
Strike Hard Productions LLC- Acquisition
On September 1, 2019, the Company
completed an acquisition of 100% of the equity interest in Strike Hard Productions LLC, a fighting promotion business, in an effort
to execute its strategy of developing and building a Premier Development League for the MMA marketplace. The purchase price was
$20,000 in cash and 9,000,000 shares of Restricted Common Stock, 3,000,000 Restricted Shares issued to be issued to David Elder,
3,000,000 Restricted Common Shares to be issued to James Sullivan and 3,000,000 Restricted Common Shares to be issued to Matt Leavell,
collectively the sellers of the equity interest in the acquisition. The Company is required to pay the cash consideration in three
payments as follows: (i) $10,000 on or before 10 calendar days after the execution date of the agreement, (ii) $5,000 on or before
45 calendar days after the execution date of the agreement, and (iii) $5,000 on or before 90 calendar days after the execution
date of the agreement.
Consideration
|
|
|
|
Cash
|
|
$
|
20,000
|
|
9,000,000 shares of common stock issued to the sellers
|
|
|
57,600
|
|
Total consideration
|
|
$
|
77,600
|
|
|
|
|
|
|
Fair values of identifiable net assets:
|
|
|
|
|
Cages
|
|
$
|
22,000
|
|
Event asset (tables)
|
|
|
1,000
|
|
Total fair value of identifiable net assets
|
|
|
23,000
|
|
|
|
|
|
|
Goodwill resulting from transaction
|
|
$
|
54,600
|
|
Goodwill is calculated as the excess of
the purchase price paid over the net assets recognized. The goodwill recorded as part of the Strike Hard acquisition primarily
reflects the value of adding Strike Hard to B2Digital in order to expand its footprint in the MMA marketplace and execute its strategy
of developing and building a Premier Development League MMA marketplace. Goodwill is not amortizable nor deductible for tax purposes.
The Company analyzed the acquisition under applicable guidance and determined that the acquisition should be accounted for as a
business combination. The initial accounting for this transaction is not completed and the fair value of the acquired identifiable
intangible assets are provisional pending receipt of the final valuations for those assets.
The Company is required to present a pro
forma balance sheet assuming the transaction was consummated on the date of the latest balance sheet included in the filing and
a pro forma statement of operations assuming the transaction was consummated at the beginning of the fiscal year presented and
carried forward through any interim period presented. However, since the initial accounting has not been finalized for the transaction
the Company believes presenting pro forma information is impracticable and plans to present it once the accounting is finalized.
NOTE 5 - NOTES PAYABLE
The following is a summary of notes payable as of
September 30, 2019 and March 31, 2019:
|
|
As of
|
|
|
As of
|
|
|
|
September 30,
2019
|
|
|
March 31,
2019
|
|
Notes payable - current maturity:
|
|
|
|
|
|
|
|
|
Emry Capital $14,000, 4% loan with principal and interest due April, 2020.
|
|
$
|
14,000
|
|
|
$
|
14,000
|
|
Notes payable – in default:
|
|
|
|
|
|
|
|
|
Good Hunting $15,000, 7.5% loan with principal and interest due March 31, 2019 (In Default)
|
|
|
15,000
|
|
|
|
15,000
|
|
Notes payable – long term:
|
|
|
|
|
|
|
|
|
WLES LP LLC $60,000, 5% loan due January 15, 2022
|
|
|
60,000
|
|
|
|
60,000
|
|
Total
|
|
$
|
89,000
|
|
|
$
|
89,000
|
|
On August 31, 2019, WLES LP LLC agreed to
sign an amendment which extended the maturity date of the note and added conversion option. This amendment gave rise to a modification
because a substantive conversion option was added to the contract. Under ASC 470-50-40-10, when a modification or an exchange
of debt instruments adds a substantive conversion option debt extinguishment accounting is required. As a result, the Company
recorded a loss on modification of debt in the amount of $50,756.
NOTE 6 - EQUITY
Preferred stock
There are 50,000,000 shares
authorized as preferred stock, of which 40,000,000 are designated as Series B and 2,000,000 are designated as Series A. 8,000,000
shares have yet to be designated. All 2,000,000 shares of Series A preferred are issued and outstanding. Each share of Series A
preferred is convertible into 240 shares of common stock. The Series A Preferred Stock votes with the Common Stock on all matters
to be voted on by the common stock on an as-converted basis. On such matters, each holder of Series A Preferred Stock is entitled
to 240 votes for each share of Series A Preferred Stock held by such shareholder.
Common stock
On April 23, 2019 the Company
issued 4,000,000 shares of common stock in exchange for services valued at $25,600 or $0.0064 per share.
On May 14, 2019 the Company sold 1,562,500
shares of common stock for $10,000 or $0.0064 per share.
On May 25, 2019 the Company sold 11,718,750 shares of common stock for
$75,000 or $0.0064 per share.
On June 1, 2019 the Company
issued 67,000,000 shares of common stock in exchange for services valued at $428,800 or $0.0064 per share.
On June 1, 2019 the Company
issued 6,000,000 shares of common stock in exchange for the acquisition of UCL MMA LLC valued at $38,400 or $0.0064 per share.
On July 3, 2019 the Company
issued 6,000,000 shares of common stock in exchange for services valued at $38,400 or $0.0064 per share.
On July 8, 2019, the Company
entered into a Subscription Agreement with a holder for the sale of 14,062,500 shares of common stock at $0.0064 per share, or
$90,000.
On July 15, 2019 the Company
issued 30,500,000 shares of common stock in exchange for services valued at $195,200 or $0.0064 per share.
On July 15, 2019 the Company
issued 8,000,000 shares of common stock in exchange for the acquisition of Pinnacle Combat LLC valued at $51,200 or $0.0064 per
share.
On August 30, 2019 the Company sold 15,625,000
shares of common stock for $100,000 or $0.0064 per share.
On September 7, 2019 the Company sold 7,812,500
shares of common stock for $50,000 or $0.0064 per share.
On September 19, 2019 the Company sold 11,718,750
shares of common stock for $75,000 or $0.0064 per share.
On September 27, 2019, the Company canceled
7,500,000 in exchange for the cancellation of $75,000 in Notes Receivable.
As part of the Strike Hard Productions LLC acquisition,
the Company issued 9,000,000 shares of common stock valued at $57,600 or $0.0064 per share.
NOTE 7 – COMMITMENTS AND
CONTINGENCIES
During the normal course of
business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits
of the case in accordance with FASB ASC 450-20-50, Contingencies. The Company evaluates its exposure to the matter, possible legal
or settlement strategies and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is
probable and can be reasonably estimated, it establishes the necessary accruals. As of September 30, 2019, the Company is not aware
of any contingent liabilities that should be reflected in the consolidated financial statements.
The Company entered into employment
agreements with its Chief Executive Officer and Executive Vice President as of November 24, 2017. Under the terms of these agreements
the Company will be liable for severance and other payments under certain conditions. The employment agreement for the Executive
Vice President is for a period of 36 months and renews for a successive two years unless written notice is provided by either party
under the terms of the agreement. The employment agreement for the Chief Executive Officer can be terminated by the Chief Executive
Officer upon three months written notice. Termination of the Chief Executive Officer requires 80% of the votes of all stockholders
of the Company.
Each of the acquisition agreements contain
a Management Services Agreement (“MSA”) whereby the Company agrees to pay a management fee based on certain performance
targets. The MSA agreements expire 10 years from the acquisition agreement dates.
NOTE 8 – GOING CONCERN
The Company's financial statements
are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization
of assets and liquidation of liabilities in the normal course of business. At September
30, 2019 and March 31, 2019, the Company had $36,407 and $27,579 in cash and $49,497 in working capital and $85,372 in negative
working capital, respectively. For the six months ended September 30, 2019 and 2018, the Company had a net loss of $904,927
and $51,627, respectively. For the three months ended September 30, 2019 and 2018, the Company had a net loss of $413,415
and $17,114, respectively. Continued losses may adversely affect the liquidity of the Company in the future. In view of
the matters described in the preceding paragraph, recoverability of a major portion of the recorded asset amounts shown in the
accompanying balance sheet is dependent upon continued operations of the Company, which in turn is dependent upon the Company's
ability to raise additional capital, obtain financing and to succeed in its future operations. The financial statements do not
include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification
of liabilities that might be necessary should the Company be unable to continue as a going concern.
As a going concern, Management’s
plan moving forward is to improve operating results through the live event sports businesses. Management believes these will operate
with positive cash flows and facilitate acquisition of additional Sports related businesses. Management plans to finance the growth
of the company and cover operating shortfalls by securing convertible loans and selling common stock.
NOTE 9 - SUBSEQUENT EVENTS
Formation of wholly-owned subsidiary
On October 1, 2019, the Company
formed a wholly-owned subsidiary called B2 Productions LLC. B2 Productions is an entity that supplies all the TV, PPV and media
for B2 Fighting Series LIVE Events.
Securities purchase agreement
On October 4, 2019, the Company
entered into a Securities Purchase Agreement with GS Capital Partners, LLC, whereby the Company agreed to issue an $82,000 face
value, 8% convertible note.
Convertible promissory note
On October 31, 2019, the Company
issued a face value $208,000 Convertible Promissory Note to GS Capital Partners, LLC. The Note has a maturity date
of December 15, 2020 and the Company has agreed to pay interest on the unpaid principal balance of the Note at the rate of eight
percent (8%) per annum from the date on which the Note is issued until the same becomes due and payable. The Note contains a $6,000
original issue discount.
The outstanding principal amount
of the Note is convertible into common stock at the lender’s option at $0.01 per share for the first six months. After the
six-month anniversary, the conversion price is 63% of the average of the three lowest trading prices of the Common Stock.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
To the Board of Directors and
Stockholders of
B2 Digital Incorporated
Opinion on the Financial
Statements
We have audited the accompanying
balance sheet of B2 Digital Incorporated (the “Company”) as of March 31, 2019, and the related statements of operations,
changes in stockholders’ equity and cash flows for the year then ended, and the related notes (collectively referred to as
the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position
of the Company as of March 31, 2019, and the results of its operations and its cash flows for the year then ended, in conformity
with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements
are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial
statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United
States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws
and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit
in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company
is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of
our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of
expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express
no such opinion.
Our audit included performing
procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and
disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates
made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides
a reasonable basis for our opinion.
Substantial Doubt about
the Company’s Ability to Continue as a Going Concern
The accompanying financial
statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial
statements, the Company has incurred net losses since its inception. This factor, and the need for additional financing in order
for the Company to meet its business plans raises substantial doubt about the Company’s ability to continue as a going concern.
Our opinion is not modified with respect to that matter.
We have served as the Company’s auditor
since 2019.
Tampa, Florida
August 2, 2019
4806 West Gandy Boulevard • Tampa, Florida 33611 • 813.440.6380
|
B2
Digital Incorporated
Consolidated Balance Sheet
March 31, 2019
Assets
|
|
|
|
Current Assets
|
|
|
|
|
Cash and Cash Equivalents
|
|
$
|
27,579
|
|
Prepaid Expenses
|
|
|
6,260
|
|
Note Receivable - Related Party
|
|
|
65,416
|
|
Total Current Assets
|
|
|
99,255
|
|
|
|
|
|
|
Property & Equipment
|
|
|
|
|
Cages
|
|
|
46,025
|
|
Trucks Trailers and Vehicles
|
|
|
9,500
|
|
Event Assets
|
|
|
8,987
|
|
Electronics Hardware and Software
|
|
|
6,960
|
|
Less: Accumulated Depreciation
|
|
|
(16,407
|
)
|
Total Property & Equipment
|
|
|
55,065
|
|
|
|
|
|
|
Goodwill
|
|
|
193,045
|
|
|
|
|
|
|
Total Assets
|
|
$
|
347,365
|
|
|
|
|
|
|
Liabilities & Stockholders’ Equity
|
|
|
|
|
Current Liabilities
|
|
|
|
|
Accounts Payable & Accrued Liabilities
|
|
$
|
109,627
|
|
Notes Payable - Current Maturity
|
|
|
75,000
|
|
Total Current Liabilities
|
|
|
184,627
|
|
|
|
|
|
|
Note Payable - Long Term
|
|
|
14,000
|
|
|
|
|
|
|
Total Liabilities
|
|
|
198,627
|
|
|
|
|
|
|
Commitments and Contingencies (Note 7)
|
|
|
|
|
Stockholders’ Equity
|
|
|
|
|
Common stock, $0.00001 par value; 5,000,000,000 shares authorized; 377,620,110 shares issued and outstanding
|
|
|
3,776
|
|
Preferred stock, 50,000,000 shares authorized, 40,000,000 shares of Series B; 2,000,000 shares of Series A, convertible into 240 shares of common stock; 8,000,000 shares are undesignated
|
|
|
20
|
|
Additional Paid in capital
|
|
|
2,624,573
|
|
Accumulated Deficit
|
|
|
(2,479,631
|
)
|
Total Stockholders’ Equity
|
|
|
148,738
|
|
|
|
|
|
|
Total Liabilities and Stockholders’ Equity
|
|
$
|
347,365
|
|
See accompanying notes to the financial statements.
B2
Digital Incorporated
Consolidated Statement of Operations
Year Ended March 31, 2019
Live Event Revenue
|
|
$
|
346,688
|
|
|
|
|
|
|
Live Event Expenses
|
|
|
251,550
|
|
|
|
|
|
|
Gross
Profit
|
|
|
95,138
|
|
|
|
|
|
|
General and Administrative Corporate Expenses
|
|
|
|
|
Professional Fees
|
|
|
69,024
|
|
Other General & Administrative Expenses
|
|
|
141,866
|
|
Depreciation Expense
|
|
|
12,951
|
|
General and Administrative Corporate Expenses
|
|
|
223,841
|
|
|
|
|
|
|
Loss
from Continuing Operations
|
|
|
(128,703
|
)
|
|
|
|
|
|
Interest Expense
|
|
|
5,108
|
|
|
|
|
|
|
Net
Loss
|
|
$
|
(133,811
|
)
|
|
|
|
|
|
Basic
and diluted earnings per share on net loss
|
|
$
|
(0.0004
|
)
|
|
|
|
|
|
Weighted
average shares outstanding
|
|
|
337,444,728
|
|
See accompanying notes to the financial statements.
B2 Digital Incorporated
Consolidated Statement
of Changes in Stockholders' Equity
Year Ended March 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
|
|
|
|
|
|
|
Common Stock
|
|
|
Preferred Stock
|
|
|
Paid in
|
|
|
Accumulated
|
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Deficit
|
|
|
Total
|
|
Balance March 31, 2018
|
|
|
263,075,044
|
|
|
$
|
2,631
|
|
|
|
2,000,000
|
|
|
$
|
20
|
|
|
$
|
2,381,068
|
|
|
$
|
(2,345,820
|
)
|
|
$
|
37,899
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of Common Stock
|
|
|
114,545,066
|
|
|
|
1,145
|
|
|
|
–
|
|
|
|
–
|
|
|
|
243,505
|
|
|
|
–
|
|
|
|
244,650
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(133,811
|
)
|
|
|
(133,811
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance March 31, 2019
|
|
|
377,620,110
|
|
|
$
|
3,776
|
|
|
|
2,000,000
|
|
|
$
|
20
|
|
|
$
|
2,624,573
|
|
|
$
|
(2,479,631
|
)
|
|
$
|
148,738
|
|
See accompanying notes to the financial statements.
B2 Digital Incorporated
Consolidated Statement of Cash Flows
Year Ended March 31, 2019
Cash Flows from Operating Activities
|
|
|
|
Net Loss
|
|
$
|
(133,811
|
)
|
|
|
|
|
|
Adjustments to reconcile net loss to net cash used by operating activities:
|
|
|
|
|
Stock Compensation
|
|
|
51,368
|
|
Depreciation
|
|
|
12,951
|
|
|
|
|
|
|
Changes
in Operating Assets & Liabilities:
|
|
|
|
|
Inventory
|
|
|
1,740
|
|
Prepaid Expenses and Other
|
|
|
(5,126
|
)
|
Accounts Payable & Accrued Liabilities
|
|
|
9,818
|
|
Deferred Compensation
|
|
|
1,600
|
|
Net cash used by operating activities
|
|
|
(61,460
|
)
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
Note Receivable - Related Party
|
|
|
(65,416
|
)
|
Purchases of Property & Equipment
|
|
|
(3,260
|
)
|
Net cash used by investing activities
|
|
|
(68,676
|
)
|
|
|
|
|
|
Cash Flows from Financing Activities
|
|
|
|
|
Proceeds
from Notes Payables
|
|
|
52,450
|
|
Payment of Related Party Note Payable
|
|
|
(45,035
|
)
|
Issuance of Common Stock
|
|
|
133,832
|
|
Net cash provided by financing activities
|
|
|
141,247
|
|
|
|
|
|
|
Increase
in Cash and Cash Equivalents
|
|
|
11,111
|
|
|
|
|
|
|
Cash and Cash Equivalents at beginning of period
|
|
|
16,468
|
|
|
|
|
|
|
Cash and Cash Equivalents at end of period
|
|
$
|
27,579
|
|
|
|
|
|
|
Supplemental Cash Flow Information
|
|
|
|
|
Cash paid for interest
|
|
$
|
1,443
|
|
Cash paid for income taxes
|
|
$
|
–
|
|
Conversion of Note Payable to Equity
|
|
$
|
59,400
|
|
See accompanying notes to the financial statements.
B2 DIGITAL INCORPORATED
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
Year Ended March
31, 2019
NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS
In February 2017, the Board of Directors of B2
Digital Incorporated ("B2 Digital" or the "Company") approved a complete restructuring, new management team
and strategic direction for the Company. Capitalizing on its history in television, video and technology, the Company is now forging
ahead and becoming a full service live event sports company.
B2 Digital's first strategy is to build an integrated
live event Minor League for the Mixed Martial Arts (MMA) marketplace. B2 Digital will be creating and developing Minor League champions
that will move on to the MMA Major Leagues from the B2 Fighting Series (B2FS). This will be accomplished by sponsoring operating
live events, acquiring existing MMA promotions and then inviting those champions to the B2FS Regional and National Championship
Series. B2 Digital will own all media and merchandising rights and digital distribution networks for the B2FS.
2017 marked the kickoff of the B2FS by sponsoring and
acquiring MMA regional promotion companies for the development of the B2FS. The second strategy is that the Company plans to add
additional sports, leagues, tournaments and special events to its live event business model. This will enable B2 Digital to capitalize
on their core technologies and business models that will be key to broadening the revenue base of the Company's live event core
business. B2 Digital will also be developing and expanding the B2 Digital live event systems and technologies. These include systems
for event management, digital ticketing sales, digital video distribution, digital marketing, Pay-Per View (PPV), fighter management,
merchandise sales, brand management and financial control systems.
Basis of Presentation and Consolidation
The Company has three wholly-owned subsidiaries. Hardrock
Promotions LLC which owns Hardrock MMA in Kentucky, Colosseum Combat LLC which owns Colosseum Combat MMA in Indiana and Blue Grass
MMA LLC which is a marketing company.
The consolidated financial statements, which include
the accounts of the Company and its three wholly-owned subsidiaries, are prepared in conformity with generally accepted accounting
principles in the United States of America (U.S. GAAP). All significant intercompany balances and transactions have been eliminated.
NOTE 2 - ACCOUNTING POLICIES
The significant accounting policies of the Company
are as follows:
Basis of Accounting
The accounts are maintained and the consolidated
financial statements have been prepared using the accrual basis of accounting in accordance with accounting principles generally
accepted in the United States of America (“GAAP”).
Use of Estimates
Management uses estimates and assumptions in preparing
financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from these estimates and
assumptions.
B2 DIGITAL INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Year Ended March
31, 2019
Cash and Cash Equivalents
The Company considers all highly liquid investments
with a maturity of three months or less when purchased to be cash equivalents. The Company maintains deposits primarily in four
financial institutions, which may at times exceed amounts covered by insurance provided by
the U.S. Federal Deposit Insurance Corporation ("FDIC"). The Company has not experienced any losses related to amounts
in excess of FDIC limits.
Property and
Equipment
Property and equipment are carried at cost. Depreciation
is provided on the straight-line method over the assets’ estimated service lives. Expenditures for maintenance and repairs
are charged to expense in the period in which they are incurred, and betterments are capitalized. The cost of assets sold or abandoned
and the related accumulated depreciation are eliminated from the accounts and any gains or losses are reflected in the accompanying
consolidated statement of operations of the respective period. The estimated useful lives range from 3 to 7 years.
Goodwill
Goodwill represents the cost in excess of the fair
value of net assets acquired in business combinations. The Company tests goodwill for impairment on an annual basis and when events
or changes in circumstances indicate that the carrying amount may not be recoverable. Goodwill is deemed to be impaired if the
carrying amount of goodwill exceeds its estimated fair value.
Revenue Recognition
Revenue is recognized when a customer
obtains control of promised goods or services. In addition, the standard requires disclosure of the nature, amount, timing,
and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded
reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following
five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii)
determination of whether the promised goods are performance obligations, including whether they are distinct in the context
of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv)
allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company
satisfies each performance obligation.
The Company only applies the five-step model to
contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services
it transfers to the customer. Once a contract is determined to be within the scope of Financial Accounting Standards Board (“
FASB”) Accounting Standards Codification (“ASC”) 606 at contract inception, the Company reviews the contract
to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The
Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when
the performance obligation is satisfied or as it is satisfied. Generally, the Company's performance obligations are transferred
to customers at a point in time, typically upon delivery.
Income Taxes
The Company follows Section 740-10-30 of the
FASB ASC, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of
events that have been included in the consolidated financial statements or tax returns. Under this method, deferred tax
assets and liabilities are based on the differences between the consolidated financial statement and tax bases of assets and
liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred
tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets
will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable
income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on
deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated Statements of Operations in
the period that includes the enactment date. Through March 31, 2019, the Company has an accumulated deficit. Due to
uncertainty of realization for these losses, a full valuation allowance is expected. Accordingly, no provision has been made
for federal income taxes in the accompanying consolidated financial statements.
B2 DIGITAL INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Year Ended March
31, 2019
Stock based compensation
The Company records stock-based compensation in
accordance with the provisions of FASB ASC Topic 718, “Accounting for Stock Compensation,” which establishes accounting
standards for transactions in which an entity exchanges its equity instruments for goods or services. In accordance with guidance
provided under ASC.
Topic 718, the Company recognizes an expense for
the fair value of its stock awards at the time of grant and the fair value of its outstanding stock options as they vest, whether
held by employees or others. As of March 31, 2019, all outstanding stock options were vested.
Recently Adopted Accounting Pronouncements
ASC 606, Revenue from Contracts with Customers,
was originally issued by the FASB in May 2014 in Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers
(Topic 606). Since then, the FASB has issued several ASUs that have revised or clarified the guidance in ASC 606. The Company has
evaluated the impact of this accounting standard update and noted that it has had no material impact.
On June 20, 2018, the FASB issued ASU 2018-07,
Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018-07
is intended to reduce cost and complexity and to improve financial reporting for share-based payments to nonemployees (for example,
service providers, external legal counsel, suppliers, etc.). Under the new standard, companies will no longer be required to value
non-employee awards differently from employee awards. Meaning that companies will value all equity classified awards at their grant-date
under ASC 718 and forgo revaluing the award after this date. The guidance is effective for interim and annual periods beginning
after December 15, 2018.
In January 2017, the FASB issued an ASU 2017-01,
Business Combinations (Topic 805) Clarifying the Definition of a Business. The amendments in this update clarify the definition
of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted
for as acquisitions or disposals of assets or businesses. The definition of a business affects many areas of accounting including
acquisitions, disposals, goodwill, and consolidation. The guidance is effective for interim and annual periods beginning after
December 15, 2017 and should be applied prospectively on or after the effective date. The Company has evaluated the impact of this
accounting standard update and noted that it has had no material impact.
The Company has implemented all new accounting
pronouncements that are in effect. These pronouncements did not have any material impact on the consolidated financial statements
unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been
issued that might have a material impact on its financial position or results of operations.
NOTE 3 – GOING CONCERN
The Company’s
financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realize its
assets and discharge its liabilities and commitments in the normal course of business for the foreseeable future. The Company
does not yet have operations or revenue to cover its operating expenses. These factors raise substantial doubt about the
Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon
generating profitable operations in the future and/or to obtain the necessary financing to meet the Company’s
obligations and repay its liabilities arising from normal business operations when they come due. As a going concern,
Management’s plan moving forward is to improve operating results through the live event sports businesses. Management
believes these will operate with positive cash flows and facilitate acquisition of additional Sports related businesses.
Management plans to finance the growth of the company and cover operating shortfalls by securing convertible loans and
selling common stock. While the Company believes that it will be successful in obtaining the necessary financing and
generating revenue to fund its operations, meet regulatory requirements and achieve commercial goals, there are no assurances
that such additional funding will be achieved and that it will succeed in its future operations. The consolidated financial
statements of the Company do not include any adjustments that may result from the outcome of these uncertainties.
B2 DIGITAL INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Year Ended March
31, 2019
NOTE 4 - RELATED PARTY
B2 Management, LLC (“B2 Management”)
has as its sole member the Chief Executive Officer and Chairman of B2 Digital. During the year, the Company repaid the note payable
to B2 Management of $45,035. As of March 31, 2019, the Company has an uncollateralized, non-interest bearing note receivable of
$65,416 from B2 Management that is due upon demand.
NOTE 5 - NOTES PAYABLE
The following is a summary of notes payable as of March 31, 2019:
|
|
Total
|
|
WLES LP LLC $60,000, 5% loan due in 18 monthly Installments
through June, 2019.
|
|
$
|
60,000
|
|
|
|
|
|
|
Good Hunting $15,000, 7.5% loan with principal and interest due March 31, 2019.
|
|
|
15,000
|
|
|
|
|
|
|
Emry Capital $14,000, 4% loan with principal and interest due April, 2020.
|
|
|
14,000
|
|
|
|
$
|
89,000
|
|
The notes payable balance as of March 31, 2019
includes $75,000 due during fiscal year 2020 and $14,000 due during fiscal year 2021.
NOTE 6 - EQUITY
There are 50,000,000 shares authorized as preferred
stock, of which 40,000,000 are designated as Series B and 2,000,000 are designated as Series A. 8,000,000 shares have yet to be
designated. All 2,000,000 shares of Series A preferred are issued and outstanding. Each share of Series A preferred is convertible
into 240 shares of common stock. The Series A Preferred Stock votes with the Common Stock on all matters to be voted on by the
common stock on an as-converted basis. On such matters, each holder of Series A Preferred Stock is entitled to 240 votes for each
share of Series A Preferred Stock held by such shareholder.
NOTE 7 – COMMITMENTS AND CONTINGENCIES
During the normal course of business, the Company
may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance
with FASB ASC 450-20-50, Contingencies. The Company evaluates its exposure to the matter, possible legal or settlement strategies
and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably
estimated, it establishes the necessary accruals. As of March 31, 2019, the Company is not aware of any contingent liabilities
that should be reflected in the consolidated financial statements.
The Company entered into employment
agreements with its Chief Executive Officer and Executive Vice President as of November 24, 2017. Under the terms of these agreements
the Company will be liable for severance and other payments under certain conditions. The employment agreement for the Executive
Vice President is for a period of 36 months and renews for a successive two years unless written notice is provided by either party
under the terms of the agreement. The employment agreement for the Chief Executive Officer can be terminated by the Chief Executive
Officer upon three months written notice. Termination of the Chief Executive Officer requires 80% of the votes of all stockholders
of the Company.
B2 DIGITAL INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Year Ended March
31, 2019
NOTE 8 – INCOME TAXES
The Company accounts for income taxes in accordance
with the provisions of FASB ASC 740, Accounting for Uncertainty in Income Taxes. Deferred taxes are provided on a liability
method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry
forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences
between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance
when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be
realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
The Company is subject to taxation in the United States where the federal income tax rate is 21%.
The provision for Federal income tax consists of the
following for the year ended March 31, 2019:
|
|
2019
|
|
|
|
|
|
|
Federal income tax benefit attributable to:
|
|
|
|
|
|
|
|
|
|
Net operating loss from current operations
|
|
$
|
28,100
|
|
|
|
|
|
|
Less: valuation allowance
|
|
|
(28,100
|
)
|
|
|
|
|
|
Net provision for Federal income taxes
|
|
$
|
–
|
|
The cumulative
tax effect at the expected rate of 21% of significant items comprising our net deferred tax amount is as follows:
|
|
2019
|
|
|
|
|
|
Federal income tax benefit attributable to:
|
|
|
|
|
|
|
|
|
|
Net operating loss carryover
|
|
$
|
249,845
|
|
|
|
|
|
|
Less: valuation allowance
|
|
|
(249,845
|
)
|
|
|
|
|
|
Net deferred tax asset
|
|
$
|
–
|
|
The related deferred tax benefit on the above unutilized
tax losses has a full valuation allowance not recognized against it as there is no certainty of its realization. Management has
evaluated tax positions in accordance with ASC 740 and has not identified any significant tax positions, other than those disclosed.
Due to the change in ownership provisions of the
income tax laws of United States of America, net operating loss carry forwards of approximately $249,845, which expire in 20 years
and are currently expiring annually for federal income tax reporting purposes, are subject to annual limitations. When a change
in ownership occurs, net operating loss carry forwards may be limited as to use in future years.
B2 DIGITAL INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Year Ended March
31, 2019
NOTE 9 - SUBSEQUENT EVENTS
In preparing the accompanying financial statements,
management has evaluated all subsequent events and transactions for disclosure through August 1, 2019, the date the consolidated
financial statements were available for issuance and no other items, in management’s opinion, have occurred through that
date.
On Friday May 22, 2019, the Company filed a form 253G2
to change the offering price to $.0064 per share for the Registration A Common Shares.
On June 1, 2019, the Company completed its previously
announced acquisition of 100% of the equity interest in United Combat League, UCL MMA LLC, the owner of Colosseum Combat MMA in
Indiana. The purchase price was $20,000 in cash and 6,000,000 shares of Restricted Common Stock issuable to Michael Davis, the
seller of the equity interest in the acquisition.
On July 15, 2019, to be effective June 29, 2019,
the Company completed an acquisition of 100% of the equity interest in Pinnacle Combat LLC of Iowa. The purchase price was $20,000
in cash and 8,000,000 shares of Restricted Common Stock, 5,000,000 Restricted Shares issued to be issued to Harry Maglaris and
3,000,000 Restricted Common Shares to be issued to Ken Rigdon, collectively the sellers of the equity interest in the acquisition.
REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
To the Board of Directors and
Stockholders of B2Digital, Incorporated
Opinion on the Financial Statements
We have audited the accompanying balance
sheet of B2Digital, Incorporated (the “Company”) as of March 31, 2018, and the related statements of operations, changes
in stockholders’ equity, and cash flows for the year ended March 31, 2018, and the related notes (collectively referred to
as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial
position of the Company as of March 31, 2018, and the results of its operations and its cash flows for the year ended March 31,
2018, in conformity with accounting principles generally accepted in the United States of America.
Explanatory Paragraph – Going Concern
The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern. As discussed in Note 4 to the financial statements, the
Company has suffered recurring losses from operations and has a working capital deficiency that raise substantial doubt about its
ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 4. The financial
statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility
of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based
on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB)
and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with
the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have,
nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required
to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the
effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures
to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures
that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures
in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made
by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a
reasonable basis for our opinion.
We have served as the Company’s auditor since
2017.
/s/ M. Vail & Associates, P.C.
Richardson, Texas
July 6, 2018
B2 DIGITAL INCORPORATED
BALANCE SHEET
March 31, 2018
Assets
|
|
|
|
Current assets
|
|
|
|
|
Cash
|
|
$
|
6,428
|
|
Undeposited funds
|
|
|
10,040
|
|
Inventory
|
|
|
1,740
|
|
Total current assets
|
|
|
18,208
|
|
|
|
|
|
|
Fixed assets
|
|
|
|
|
Cages
|
|
|
45,000
|
|
Trucks and trailers
|
|
|
9,500
|
|
Electronics
|
|
|
4,115
|
|
Event assets
|
|
|
9,597
|
|
Less: accumulated depreciation
|
|
|
(3,456
|
)
|
Total fixed assets
|
|
|
64,756
|
|
|
|
|
|
|
Intangible assets
|
|
|
|
|
Loan fees
|
|
|
1,200
|
|
Less: accumulated amortization
|
|
|
(67
|
)
|
Total intangible assets
|
|
|
1,133
|
|
|
|
|
|
|
Other assets
|
|
|
|
|
Deferred compensation
|
|
|
1,600
|
|
Goodwill
|
|
|
193,044
|
|
Total other assets
|
|
|
194,644
|
|
|
|
|
|
|
Total assets
|
|
$
|
278,741
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
Current liabilities
|
|
|
|
|
Accounts payable
|
|
$
|
92,095
|
|
Notes payable - current
|
|
|
40,000
|
|
Notes payable to related parties
|
|
|
88,747
|
|
Total current liabilities
|
|
|
220,842
|
|
|
|
|
|
|
Notes payable - long-term
|
|
|
20,000
|
|
|
|
|
|
|
Total liabilities
|
|
|
240,842
|
|
|
|
|
|
|
Stockholders' equity
|
|
|
|
|
Common stock, $0.00001 par value; 5,000,000,000 shares authorized; 263,075,044 shares issued and outstanding
|
|
|
2,631
|
|
Preferred stock, 50,000,000 shares authorized; 40,000,000 shares of Series B; 2,000,000 shares of Series A, convertible into 240 shares of common stock;8,000,000 shares are undesignated
|
|
|
20
|
|
Additional paid in capital
|
|
|
2,381,068
|
|
Accumulated deficit
|
|
|
(2,345,820
|
)
|
Total stockholders' equity
|
|
|
37,899
|
|
|
|
|
|
|
Total liabilities and stockholders' equity
|
|
$
|
278,741
|
|
See accompanying notes to financial statements
B2 DIGITAL INCORPORATED
STATEMENT OF OPERATIONS
Year Ended March 31, 2018
Sales
|
|
$
|
171,092
|
|
|
|
|
|
|
Cost of goods sold
|
|
|
6,377
|
|
|
|
|
|
|
Gross profit
|
|
|
164,715
|
|
|
|
|
|
|
Live event expenses
|
|
|
158,887
|
|
|
|
|
|
|
Income from live events
|
|
|
5,828
|
|
|
|
|
|
|
General and administrative corporate expense
|
|
|
|
|
Amortization
|
|
|
67
|
|
Bank fees
|
|
|
1,179
|
|
Legal fees
|
|
|
64,788
|
|
Marketing
|
|
|
12,256
|
|
Officer compensation
|
|
|
28,000
|
|
Outside services
|
|
|
5,275
|
|
Press releases
|
|
|
2,691
|
|
Professional fees
|
|
|
50,074
|
|
Public relations
|
|
|
2,248
|
|
Rent
|
|
|
600
|
|
Sponsorships
|
|
|
10,300
|
|
Total general and administrative corporate expense
|
|
|
177,478
|
|
|
|
|
|
|
Loss from continuing operations
|
|
|
(171,650
|
)
|
|
|
|
|
|
Other expense
|
|
|
|
|
Loss on sale of investments
|
|
|
600
|
|
Interest expense
|
|
|
4,495
|
|
Total other expense
|
|
|
5,095
|
|
|
|
|
|
|
Net loss
|
|
$
|
(176,745
|
)
|
B2 DIGITAL INCORPORATED
STATEMENT OF CHANGES IN SHAREHOLDERS'
EQUITY
Year Ended March 31, 2018
|
|
Common
Stock
|
|
|
Preferred Stock
|
|
|
Additional
Paid-In Capital
|
|
|
Accumulated
Deficit
|
|
|
Total
|
|
Balance March 31, 2017
|
|
$
|
42,199
|
|
|
$
|
20
|
|
|
$
|
2,072,125
|
|
|
$
|
(2,169,075
|
)
|
|
$
|
(54,731
|
)
|
Reverse stock split
|
|
|
(44,747
|
)
|
|
|
–
|
|
|
|
44,747
|
|
|
|
–
|
|
|
|
–
|
|
Issuance of common stock
|
|
|
5,179
|
|
|
|
–
|
|
|
|
264,196
|
|
|
|
–
|
|
|
|
269,375
|
|
Net loss
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
(176,745
|
)
|
|
|
(176,745
|
)
|
Balance March 31, 2018
|
|
$
|
2,631
|
|
|
$
|
20
|
|
|
$
|
2,381,068
|
|
|
$
|
(2,345,820
|
)
|
|
$
|
37,899
|
|
See accompanying notes to financial statements
B2 DIGITAL INCORPORATED
STATEMENT OF CASH FLOWS
Year Ended March 31, 2018
Cash flows from operating activities
|
|
|
|
Net loss
|
|
$
|
(176,745
|
)
|
Adjustments to reconcile net loss to net cash used by operating activities:
|
|
|
|
|
Depreciation and amortization
|
|
|
3,523
|
|
Accounts payable
|
|
|
76,844
|
|
Deferred compensation
|
|
|
(1,600
|
)
|
Loss on sale of investments
|
|
|
600
|
|
Inventory
|
|
|
(1,740
|
)
|
Accrued other expenses
|
|
|
4,245
|
|
Net cash used by operating activities
|
|
|
(94,873
|
)
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
Purchase of goodwill
|
|
|
(193,045
|
)
|
Purchases of fixed assets
|
|
|
(68,212
|
)
|
Net cash used by investing activities
|
|
|
(261,257
|
)
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
Payments for debt issue costs
|
|
|
(1,200
|
)
|
Proceeds from notes payable
|
|
|
104,423
|
|
Issuance of common stock
|
|
|
269,375
|
|
Net cash provided by financing activities
|
|
|
372,598
|
|
|
|
|
|
|
Increase in cash
|
|
|
16,468
|
|
|
|
|
|
|
Cash at beginning of period
|
|
|
–
|
|
Cash (and equivalents) at end of period
|
|
$
|
16,468
|
|
|
|
|
|
|
Supplemental cash flow information
|
|
|
|
|
Cash paid for interest
|
|
$
|
4,495
|
|
Cash paid for income taxes
|
|
$
|
–
|
|
See accompanying notes to financial statements
B2 DIGITAL INCORPORATED
NOTES TO FINANCIAL STATEMENTS
Year Ended March 31, 2018
NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS
In February 2017, the Board of Directors
of B2 Digital Incorporated ("B2 Digital" or the "Company") approved a complete restructuring, new management
team and strategic direction for the company. Capitalizing on its history in television, video and technology, the Company is now
forging ahead and becoming a full service live event sports company.
The Chairman and CEO of the Company is
now Greg P. Bell. Mr. Bell has over 30 years of global experience developing more than 20 companies in the sports, television,
entertainment, digital distribution and banking transaction industries. Capitalizing on the combination of his expertise, relationships
and experience as well as his involvement with more than 40,000 live events over his career for major sports leagues and entertainment
venues, B2 Digital is in the process of developing and acquiring companies to become a premier vertically integrated live event
sports company.
B2 Digital's first strategy is to build
an integrated live event Minor League for the Mixed Martial Arts (MMA) marketplace, which is a billion dollar industry. B2 Digital
will be creating and developing Minor League champions that will move on to the MMA Major Leagues from the B2 Fighting Series (B2FS).
This will be accomplished by sponsoring operating live events, acquiring existing MMA promotions and then inviting those champions
to the B2FS Regional and National Championship Series. B2 Digital will own all media and merchandising rights and digital distribution
networks for the B2FS. This concept was developed and test marketed for 2 years by Mr. Bell's B2 Management, LLC.
2017 marked the kickoff of the B2FS by
sponsoring and acquiring MMA regional promotion companies for the development of the B2FS. The second strategy is that the company
plans to add additional sports, leagues, tournaments and special events to its live event business model. This will enable B2 Digital
to capitalize on their core technologies and business models that will be key to broadening the revenue base of the company's live
event core business. B2 Digital will also be developing and expanding the B2 Digital live event systems and technologies. These
include systems for event management, digital ticketing sales, digital video distribution, digital marketing, Pay-Per View (PPV),
fighter management, merchandise sales, brand management and financial control systems.
Historically, B2 Digital had been a provider
of in-room, on-demand video entertainment and satellite services to the domestic lodging industry. In the past B2 Digital had provided
the video services to over 50,000 hotel rooms in the lodging industry. PPV lost a great deal of market share due to the increased
internet use by hotel guests. With this loss the B2 Digital Board of Directors agreed to dissolve Hotel Movie Network on March
11, 2010.
NOTE 2 - ACCOUNTING POLICIES
The significant accounting policies of the Company are as
follows:
Basis of Accounting
The accounts are maintained and the financial
statements have been prepared using the accrual basis of accounting in accordance with accounting principles generally accepted
in the United States of America (“GAAP”).
Use of Estimates
Management uses estimates and assumptions
in preparing financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure
of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from these estimates
and assumptions.
Cash
The Company considers all highly liquid
investments with a maturity of three months or less when purchased to be cash equivalents. The Company maintains deposits primarily
in four financial institutions, which may at times exceed amounts covered by insurance provided by the U.S. Federal Deposit Insurance
Corporation ("FDIC"). The Company has not experienced any losses related to amounts in excess of FDIC limits.
Inventories
Inventories are carried at the lower of
cost or market using the last-in, first-out (“LIFO”) method of accounting for domestic inventories.
Property and Equipment
Property and equipment are carried at cost. Depreciation is
provided on the straight-line method over the assets’ estimated service lives. Expenditures for maintenance and repairs are
charged to expense in the period in which they are incurred, and betterments are capitalized. The cost of assets sold or abandoned
and the related accumulated depreciation are eliminated from the accounts and any gains or losses are reflected in the accompanying
statement of income of the respective period. The estimated useful lives of machinery and equipment range from 4 to 10 years. Goodwill
Goodwill represents the cost in excess of the fair value of
net assets acquired in business combinations. The Company tests goodwill for impairment on an annual basis and when events or changes
in circumstances indicate that the carrying amount may not be recoverable. Goodwill is deemed to be impaired if the carrying amount
of goodwill exceeds its estimated fair value.
Revenue Recognition
Continuing revenue is recognized monthly
as earned. Initial revenue is recognized when all services or conditions relating to the sale of the individual services have been
substantially performed.
Income Taxes
The Company is organized as a corporation for federal income
tax purposes. Through March 31, 2018 the Company has an accumulated deficit. Due to uncertainty of realization for these losses
a full valuation allowance is expected. Accordingly, no provision has been made for federal income taxes in the accompanying financial
statements.
Recently Adopted Accounting Pronouncements
In August 2014, the Financial Accounting
Standards Board issued Accounting Standards Update No. 2014-15, Presentation of Financial Statements – Going Concern, requiring
management to evaluate, on an annual basis, whether there are any conditions or events, considered in the aggregate, that would
raise substantial doubt about the ability to continue as a going concern within one year after the date that the financial statements
are issued. The guidance further defines substantial doubt and the disclosure requirements necessary once substantial doubt is
identified. The guidance is effective for annual periods ending after December 15, 2016. The Company has adopted this guidance
during the year ended March 31, 2018.
NOTE 3 - BUSINESS ACQUISITIONS
On November 3, 2017, B2 Digital completed
its previously announced acquisition of 100% of the equity interest in Hard Rock Promotions LLC, the owner of Hard Rock MMA in
Kentucky.
The following table summarizes the consideration
paid and the amount of the assets acquired at the acquisition date:
Consideration
Cash
|
|
$
|
48,759
|
|
15,000,000 shares of common stock issued to the sellers
|
|
|
100,000
|
|
|
|
|
|
|
Total consideration
|
|
$
|
148,759
|
|
Recognized amounts of identifiable net assets:
Cash and cash equivalents
|
|
$
|
16,699
|
|
Property and equipment
|
|
|
35,550
|
|
|
|
|
|
|
Total identifiable net assets
|
|
|
52,249
|
|
Goodwill
|
|
|
96,510
|
|
|
|
|
|
|
|
|
$
|
148,759
|
|
On November 20, 2017, B2 Digital completed
its previously announced acquisition of 100% of the equity interest in Colosseum Combat LLC, the owner of Colosseum Combat MMA
in Indiana.
The following table summarizes the consideration paid and the amount of the assets acquired at the acquisition
date:
Consideration
Cash
|
|
$
|
26,418
|
|
8,000,000 shares of common stock issued to the sellers
|
|
|
80,000
|
|
|
|
|
|
|
Total consideration
|
|
$
|
106,418
|
|
Recognized amounts of identifiable net assets
Cash and cash equivalents
|
|
$
|
273
|
|
Property and equipment
|
|
|
30,400
|
|
|
|
|
|
|
Total identifiable net assets
|
|
|
30,673
|
|
Goodwill
|
|
|
75,745
|
|
|
|
|
|
|
|
|
$
|
106,418
|
|
On January 9, 2018, B2 Digital completed its previously announced acquisition of 100% of the equity interest in Blue Grass MMA LLC.
The following table summarizes the consideration paid and the amount of the assets acquired at the acquisition date:
Consideration
3,000,000 shares of common stock issued to the sellers
|
|
$
|
21,000
|
|
|
|
|
|
|
Total consideration
|
|
$
|
21,000
|
|
Recognized amounts of identifiable net assets
Cash and cash equivalents
|
|
$
|
210
|
|
|
|
|
|
|
Total identifiable net assets
|
|
|
210
|
|
Goodwill
|
|
|
20,790
|
|
|
|
|
|
|
|
|
$
|
21,000
|
|
NOTE 4 - GOING CONCERN
The Company had revenue of $171,092 and
operating losses of $171,650 during the fiscal year ended March 31, 2018. For the last two quarters the three acquired MMA companies
generated net income of $5,828 from operating LIVE events. The fiscal year loss of $171,650 was due primarily to non-recurring
Company restructuring expenses of $64,788 in legal, $50,074 in accounting and filing, and $28,000 in stock issuances to management.
As a going concern, Management’s
plan moving forward is to improve operating results through the live event sports businesses. Management believes these will operate
with positive cash flows and facilitate acquisition of additional Sports related businesses. Management plans to finance the growth
of the company and cover operating shortfalls by securing convertible loans and selling common stock.
NOTE 5 - RELATED PARTY
Good Hunting, Inc.
Pursuant to B2 Digital Resolution dated
April 27, 2015, a Promissory Note was entered into between B2 Digital and Good Hunting, Inc. in the amount of $21,000. The note
bears a 7.5% interest rate and was to be paid in full before April 29, 2017. Upon written request the note may be converted to
common stock under Rule 144. As of March 31, 2018 the note had not been converted to stock. The due date has been extended and
interest was accrued through March 31, 2018.
Pursuant to B2 Digital Resolution dated
April 27, 2016, a Promissory Note was entered into between B2 Digital and Good Hunting, Inc. in the amount of $15,000. The note
bears a 7.5% interest rate and was to be paid in full before December 31, 2017. Upon written request the note may be converted
to common stock under Rule 144. The due date has been extended and interest was accrued through March 31, 2018.
At March 31, 2018, B2 Digital had total
notes payable to Good Hunting, Inc. of $42,750. Accrued interest on the notes totaled $6,750 as of March 31, 2018, and is included
in the note payable balance.
B2 Management, LLC
During May, 2017 notes totaling $37,100
were entered into with B2 Management, LLC. The notes bear a 4% interest rate and shall be paid in full within four years. Payments
of $200 were made in September, 2017. An additional $26,600 in payments were made in the quarter ended March 31, 2018.
During August and September, 2017 additional notes totaling
$6,000 were entered into with B2 Management, LLC. The notes bear a 4% interest rate and shall be paid in full within four years.
At various times during the three months
ended December 31, 2017, additional notes totaling $20,045 were entered into with B2 Management, LLC. The notes bear a 4% interest
rate and shall be paid in full within four years. Payments of $562 were made in November and December, 2017.
During January and February, 2018 additional
notes totaling $8,640 were entered into with B2 Management, LLC. The notes bear a 4% interest rate and shall be paid in full within
four years.
At March 31, 2018, B2 Digital had total
notes payable to B2 Management, LLC of $45,998. Accrued interest on the notes totaled $963 as of March 31, 2018, and is included
in the note payable balance.
B2 Management, LLC has as its sole member, Greg P. Bell. Mr.
Bell is Chief Executive Officer and Chairman of B2 Digital.
NOTE 6 - NOTES PAYABLE
The following is a summary of notes payable as of March 31,
2018:
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Current
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Long-term
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Total
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WLES LP LLC $60,000, 5% loan due in 18 monthly
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|
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Installments through June, 2019.
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$
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40,000
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$
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20,000
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$
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60,000
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NOTE 7 - EQUITY
B2 Digital has 5,000,000,000 shares of
common stock authorized and 263,075,044 shares issued and outstanding. The common stock has a par value of $0.00001. All shares
are adjusted to reflect the 100-to-1 reverse stock split on October 2, 2017.
On May 4, 2017, B2 Digital Board of Directors
authorized Manhattan Transfer to send a certificate for 1,000,000 shares of B2 Digital Common Stock under Rule 144 (Restricted)
to B2 Management, LLC. Payment for said shares of Ten-Thousand Dollars ($10,000) had been received on May 4, 2017 and deposited
in the B2 Digital checking account. Mr. Greg P. Bell has a relationship with both B2 Digital as a member of the Board of Directors
and with B2 Management LLC of ownership. The shares were initially authorized by Board of Directors Resolution dated February 8,
2017.
On May 6, 2017, B2 Digital Board of Directors
authorized Manhattan Transfer to send a certificate for 2,000,000 shares of B2 Digital Common Stock under Rule 144 (Restricted)
to B2 Management, LLC. Payment for said shares of Twenty-Thousand Dollars ($20,000) had been received on May 6, 2017 and deposited
in the B2 Digital checking account. Mr. Greg P. Bell has a relationship with both B2 Digital as a member of the Board of Directors
and with B2 Management LLC of ownership.
On October 2, 2017, B2 Digital completed
its previously announced 100-to-1 reverse stock split of its Common Stock (the “Reverse Stock Split”). Pursuant to
the terms of the Reverse Stock Split, each 100 issued and outstanding shares of Common Stock were converted into one (1) issued
and outstanding share of Common Stock. No fractional shares were issued. Instead, each holder of any fractional interest created
by the Reverse Stock Split was issued one post-Reverse Stock Split share of Common Stock in exchange for such fractional interest.
In connection with the Reverse Stock Split,
no proportional adjustment to the conversion basis, voting rights or any other rights applicable to the Issuer’s Series A
Convertible Preferred Stock (“Series A Preferred Stock”) were made.
On November 3, 2017, B2 Digital completed its previously announced
acquisition of 100% of the equity interest in Hard Rock Promotions LLC, the owner of Hard Rock MMA in Kentucky. As part of the
purchase price 15,000,000 shares of Common Stock were issued to Higdon MMA Consulting LLC, the seller of the equity interest in
the acquisition.
On November 20, 2017, B2 Digital completed
its previously announced acquisition of 100% of the equity interest in Colosseum Combat LLC, the owner of Colosseum Combat MMA
in Indiana. As part of the purchase agreement 8,000,000 shares of Common Stock were issued to Mark Slater, the seller of the equity
interest in the acquisition.
On November 24, 2017, Messrs. Metz and
Georgens entered into Board Service Agreements with the Company (collectively, the “Board Service Agreements”). Pursuant
to the terms of the Board Service Agreements, Mr. Metz was awarded 3,000,000 shares and Mr. Georgens was awarded 1,000,000 shares
of the Company’s common stock, par value $0.00001 per share (the “Common Stock” and each such award, a “Director
Common Stock Award". Each Director Common Stock Award will vest over a two-year period from November 24, 2017, with 50% vesting
on the first anniversary thereof and 50% vesting on the second anniversary thereof.
On November 24, 2017, as compensation for
Mr. Bell’s services pursuant to the terms of the CEO Agreement, the Company issued B2 Management Group LLC, a limited liability
company wholly owned and controlled by Mr. Bell (“B2 Management”), a total of 30,000,000 shares of Common Stock (the
“CEO Stock Award”).
As further compensation for Mr. Bell’s
services to the Company in connection with the Company’s acquisition activity, the Company issued B2 Management an additional
60,000,000 shares of Common Stock as compensation for the completion of the Company’s previously announced acquisitions of
Hard Rock MMA (30,000,000 Shares) and Colosseum Combat LLC (30,000,000) (collectively, the “Recent Acquisitions”).
On November 24, 2017, as payment for past compensation owed
to Mr. LaBarre from his employment agreement for his past services to the Company, the Company issued Mr. LaBarre 50,000,000 shares
of Common Stock. As compensation for Mr. LaBarre’s continuing services to the Company as Executive Vice President, the Company
will issue Mr. LaBarre 4,000,000 shares of Common Stock per year for each year in which Mr. LaBarre remains employed in such capacity
and the LaBarre Agreement remains in effect (the “Annual Salary Issuance”). 50% of the Annual Salary Issuance will
vest every six months. In the event of a merger or consolidation of the Company in which the Company is not the surviving entity,
or a proposed dissolution or liquidation of the Company or a sale of substantially all of its assets, any unvested portion of the
Annual Salary Issuance remaining in the then-current term of the LaBarre Agreement will vest immediately.
On November 24, 2017, the Board of Directors
approved the addition of Joe D. Michaels as a Company Advisor to advise the Chairman & CEO on Company Business and Strategy.
Mr. Michaels was issued 3,000,000 Restricted Common Shares for his services.
On November 24, 2017, the Board of Directors
approved the addition of two Independent Contractors to complete services. Gary Thomas was Issued 1,000,000 Restricted Common Shares
for his services. Mr. Porter was Issued 1,000,000 Restricted Common Shares for his services.
On December 17, 2017, the Board of Directors
approved the addition of an Independent Contractor to complete services. John Prisco was Issued 1,000,000 Restricted Common Shares
for his services.
On December 20, 2017, Gary Thomas was issued
375,000 shares for his incentive award for his work in the Company acquiring Colosseum Combat LLC.
On December 26, 2017, the Board of Directors
approved the issue of 30,000,000 Restricted Common Shares to B2 Management Group LLC for the “Incentive Award Shares”
for the completion of the Acquisition of Blue Grass MMA.
On January 9, 2018, B2 Digital issued 1,500,000
Restricted Common Shares to Gary Thomas and 1,500,000 Restricted Common Shares to Juan Valle for the completion of the Acquisition
of Blue Grass MMA.
On December 31, 2017, B2 Digital entered
into a MMA Training Facility Agreement with Amped Fitness LLC to be an Approved B2 Fighting Series Training Facility for 500,000
Restricted Common Shares and the Board of Directors approved by Unanimous Consent the MMA Training Facility Agreement and the issue
of shares on March 17, 2018.
On January 28, 2018, B2 Digital entered
into a Loan Agreement with WLES LP LLC for $60,000 and 6,000,000 Restricted Common Shares and the Board of Directors approved by
Unanimous Consent the Loan and Agreement and the issue of shares on March 17, 2018.
On March 17, 2018, the Board of Directors
approved by Unanimous Consent to Issue 500,000 Common Restricted Shares to Kellen Vancamp and 500,000 Common Restricted Shares
to Cameron Vancamp as an award for each of them becoming Champions in both Hard Rock MMA and Colosseum Combat in their respective
weight classes.
In addition there are 50,000,000 shares
authorized as preferred stock, of which 40,000,000 are designated as Series B and 2,000,000 are designated as Series A. 8,000,000
shares have yet to be designated. All 2,000,000 shares of Series A preferred are issued and outstanding. Each share of Series A
preferred is convertible into 240 shares of common stock.
NOTE 8 - CONTINGENCIES
On February 6, 2017 an agreement was reached
with Manhattan Transfer to satisfy outstanding invoices. All past accounts were scheduled to be paid in full on September 15, 2017.
As of March 31, 2018 the agreement has expired but B2 Digital continues to make payments on the account. The current balance is
included in accounts payable.
NOTE 9 - SUBSEQUENT EVENTS
In preparing the accompanying financial statements, management
has evaluated all subsequent events and transactions for disclosure through July 11, 2018, the date the financial statements were
available for issuance and no other items, in management’s opinion, have occurred through that date.
On April 19, 2018, the Board of Directors
approved the conversion of the amount due Good Hunting Communications, Inc. per the Loan Agreement executed on August 24, 2015
between the parties for payment in full of the Loan Agreement between the parties to be converted to 3,478,400 Common Restricted
Shares.
On April 25, 2018, the Board of Directors
approved by Unanimous Consent to Issue 5,000,000 Common Restricted Shares to Higdon MMA Consulting for the Expansion into Ohio
and receiving a Promoters license from the Ohio State Athletic Commission.
On April 25, 2018, the Board of Directors
approved the issue of 30,000,000 Restricted Common Shares to B2 Management Group LLC for the “Incentive Award Shares”
for the Expansion into Ohio and receiving a Promoters license from the Ohio State Athletic Commission.
On April 25, 2018, the Board of Directors
approved by Unanimous Consent to Issue 30,000,000 Common Restricted Shares to Emry Capital.
On June 18, 2018, the Board of Directors
approved by Unanimous Consent to Issue 3,000,000 Common Restricted Shares to W.J. Host for his advisory services provided to the
Chairman & CEO. The shares have not been issued as of June 30, 2018 and are to be issued in July 2018.
On June 18, 2018, the Board of Directors approved the addition of Riverbend Productions LLC as an Independent
Contractor to complete services. The shares have not been issued as of June 30, 2018 and are to be issued in July 2018.
PART III—EXHIBITS
Index to Exhibits
_________________
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*
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Filed with the Company’s Form 1-A on August 21, 2018
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**
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Filed with the Company’s Post-Qualification Amendment
to Form 1-A on October 1, 2019
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***
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Filed with the Company’s Post-Qualification Amendment
to Form 1-A on September 5, 2019
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SIGNATURES
Pursuant to the requirements of Regulation
A, the issuer certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form 1-A
and has duly caused this Offering Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Tampa, Florida, December 13, 2019.
(Exact name of issuer as specified in its charter):
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B2Digital, Incorporated
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By: /s/ Greg P. Bell
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Greg P. Bell, Chief Executive Officer (Principal Executive Officer).
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This Offering Statement has been signed by the following persons
in the capacities and on the dates indicated.
By:
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/s/ Greg P. Bell
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Greg P. Bell, Chief Executive Officer (Principal Executive Officer).
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Date: December 13, 2019
By:
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/s/ Greg P. Bell
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Greg P. Bell, Chief Financial Officer (Principal Financial Officer, Principal Accounting Officer).
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Date: December 13, 2019
SIGNATURES OF DIRECTORS:
/s/ Greg P. Bell
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Date: December 13, 2019
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Greg P. Bell, Director
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/s/ Paul D. H. LaBarre
|
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Date: December 13, 2019
|
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Paul D. H. LaBarre, Director
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/s/ Andrew Georgens
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Date: December 13, 2019
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Andrew Geogens, Director
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/s/ Hugh Darryl
Metz
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Date: December 13, 2019
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Hugh Darryl Metz, Director
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